Liquor Bill: Provincial Negotiating Mandates

Meeting report

ECONOMICS AND FOREIGN AFFAIRS SELECT COMMITTEE
23 September 2003
LIQUOR BILL: PROVINCIAL NEGOTIATING MANDATES

Chairperson: Mr B Tolo (ANC)

Documents handed out
Liquor Bill [B23B-2003]
Negotiating Mandates of the Provincial Negotiating Mandates:
Free State (Appendix 1)
Gauteng (Appendix 2)
Mpumalanga (Appendix 3)
Western Cape (Appendix 4)

South African Police Service Submission (Appendix 5)

SUMMARY
Proposed amendments were suggested by the following provinces; Gauteng, Mpumalanga, Western Cape, Free State on the Liquor Bill. The Bill was supported by Limpopo, Northern Cape, KwaZuluNatal Provinces. A submission by the South African Police Service was presented. The Chairperson concluded that the provinces prepare their final mandates in consultation with proposals of the Department for November 2003 when final amendment considerations would be taken to ensure that the Bill is adopted before the end of year.

MINUTES
The provinces were all briefed on the Liquor Bill by delegates and they had the opportunity to debate the Bill and propose amendments, if any, for the Committee to consider. The delegates of the individual provinces were given the opportunity to present their negotiating mandates.

Eastern Cape
Mr R Nogumla (ANC) presented the negotiating mandate.

Norms and Standards Applicable to Provincial Legislation: Restrictions on Persons that may be registered or licensed - Schedule 1, Item 2
The Chairperson would ask the state law advisors (SLA) to advise the meeting on the proposed amendment because they were challenging the legality of the Premier having to consult the Minister.

Mr T Setona (ANC) found the concern ambiguous. He said that, in terms of law, they regard the provision as unconstitutional but on the other hand, they see this consultation process to be in the interest of good governance. This stance created a serious dilemma and he asked for clarification.

In response Mr Nogumla said the province would argue that it was unnecessary for the consultation process to be written into law because the provinces are represented on the various discussion forums. They will insist that the competence should be provincial.

The Chairperson expressed understanding for their position and asked the SLA to comment.

Mr T Hercules (SLA) referred the meeting to the insertion in the preamble of the Bill "…to provide for measures to promote co-operative government in the area of liquor regulation…" and in addition the objects of the Act (Clause 2(a)(i and ii). He said that the above provisions were constructed in this way to ensure that legislation was in place to bring about consistency so that there was compliance with the Act. He agreed with the Chairperson that it could also be a guard against default registrations.

Mr Z Rama (Departmental Law Advisor) agreed with the above sentiments and added that it is intended for a smooth transition because it is an Act governing liquor industry nationally, that is being repealed. They are allowing for two competencies in the industry. He said it would serve the industry as a whole.

The Chairperson asked for the law advisors (LA) to produce a response that would reflect the reasoning of the meeting in this regard to be circulated.

Free State
Mr T Setona (ANC, Free State) presented the mandate. He indicated that the amendments proposed by his province were not very substantial nor fundamental, but more technical in nature.
Please refer to Appendix 1.

Clause 13(2)(b)
Mr K Durr (ADCP, WC) stated that the Bill deals with three competencies. The national ministers` responsibility for the licensing of liquor manufacture and distribution, and the provinces who were responsible for the retailing of that liquor. He suggested that most of the related complaints or objections could be contained in provincial legislation.

Mr Rama could see no harm in including the broader media. In fact, he agreed with the submission because not everybody had access to the Gazette. It could in effect encourage genuine participation in the formulation of the Bill.

The Chairperson asked if it was possible for the government to publish all this information in all the daily newspapers since the Gazette is the official government newspaper.

Mr Rama then clarified that the above related more to the provincial aspects of participation with regard to the retail sale of liquor. Because it related to the retail sale of liquor, it is actually incumbent on the provincial authorities to consider the broader media at that level.

The Chairperson responded very favourably to the clarification.

Mr Setona said that they were dealing with two processes, viz. repealing the old Act and replacing it with a new Act. They are considering passing this Act before the provincial legislation is in place. He asked for the Minister`s position to be defined in the context of the operationalisation of this legislation. He referred the meeting to the definition of "Minister" - chapter 1(1)(b). He furthermore asked if by definition, the responsible member of the executive is not included.

Mr Hercules referred the meeting to Clause 45(1) and indicated that it is not a provincial asset.

Clause 13(7) b
Mr Rama was comfortable with the existing wording because he thought that it covered the concerns raised. A rearrangement of the section would not alter anything already covered.

Clause 20(6)
Mr Rama said that in keeping with the due process, consideration might be towards making the effective date of cancellation the date of notification. If the effective date is the date on which it is cancelled as opposed to the date on which the registrant is notified, there would be a vacuum and a period in which the registrant would be trading unlawfully without having been notified of the cancellation. This issue, he explained, would have to be considered.

The Chairperson agreed that further consideration is required for consensus to be had.

Clause 23(1)
The Chairperson asked if the proposed amendment really changed the context of the provision.

Mr Hercules said that "prescribe" (Clause 23(1) means the Department will prescribe in terms of regulations how the register is to be maintained. He was not sure about the stipulations in the National Act concerning how government records should be kept but it is quite possible that the government can follow the same procedure followed in the provisions of the National Archives Act of South Africa (NAA), 1996. Hence, he thought it was not really necessary to include the insertion.

Mr Setona explained that the motivation for the amendment is to obligate the Minister to maintain a register, even of those applications that were cancelled. He argued that in terms of the NAA, provisions have been made for the safekeeping of these records. It meant that the obligation and administrative burden did not have to reside with the Department because an administrative system for this purpose is already in place.

Mr Durr asked if the Interpretation Act did not offer guidance concerning the publishing of a register.

Mr Rama explained that due consideration will be given by the office of the Minister to ensure that a proper system is put in place that will take cognisance of the provisions of the NAA and/or any other relevant form of contribution to the establishment of a register.

Clause 26(2)
Mr Rama said that the inconsistency relates to the non-use of the word "manufacture" in that particular section as opposed to the defining words of "manufacture" which is to produce a bottle. He did not see a problem with using these words interchangeably but for consistency of reading, the word manufacture could be inserted.

Clause 29(1)
Mr Hercules contended that the clause as it is, was quite clear. The proposed amendment seemed to be referring to the last part of the clause. It might be interpreted to mean that the use destructive force to enter the premises, is allowed.
The Chairperson agreed with Mr. Setona that it was semantics.

Clause 43(1)
Mr. Hercules suggested that the ex- or inclusion of the words would not make any substantial difference because there is a definition under the definition clause of the Act that covers it.

Mr. Durr thought it unwise to promulgate a notice because he thought it to be more correct to say that you give notice in terms of the regulations.

Mr Hercules explained that the idea is not to promulgate a notice but it means that this Act includes any schedule regulational notice under the authority of the Act.

The Chairperson requested that the Law Advisers advise the Committee about the proposed amendments in order for them to interrogate the issues before they are finally proposed for the Bill.

Gauteng
Ms N Ramodibe presented the mandate. Please refer to Appendix 2.

Clause 4(8)
Mr Rama suggested that this proposed amendment be dealt with when a similar amendment proposal comes up with the Western Cape mandate.

Clause 5(2) (e) and (f)
Not discussed

Clause 35
Both the Chairperson and Mr Rama agreed that a court would have to measure the personal circumstances and gravity of the offence when sentencing is considered.

Clause 42
Mr Rama`s take on the establishment of uniform norms and standards, only related to administrative requirements and did not intend to control the legislative functions of any province.

Mr Durr contended that retailing is a provincial competence and that this provision is encroaching upon the rights of a province to decide on the laws and regulations in the distribution of liquor in their respective provinces. The WC would therefore support Gauteng in this instance.

The Chairperson said that because liquor is potentially such a dangerous substance, the country needed a national norm so that all the provinces act in the same manner.

Although Mr Durr indicated sympathy for the point of view of the Chairperson, he warned that the Constitutional Court was against him because of a ruling that was announced in this regard already.

Mr Rama informed the meeting that the constitutional judgement stated that the difference in competencies related with the issue of licences and not with regard to the liquor industry policy as a whole.

Clause 42 "… the Minister, after consultation with the Council…" must be read in conjunction Clause 39 which sets out the functions of the Council. The core function of the Council is not limited because it is expected to regulate the industry throughout and set norms and standards for the industry nationally.

Mr Durr insisted that they were dealing with a fundamental issue and that he disagreed with both the Chairperson and Law Advisor. His understanding of the Constitutional Court ruling was that, the Minister could only make laws and set standards where the provinces failed to put these in place.

The Chairperson said that he would allow for the meeting to argue the matter at a later stage.

Concept of distributor and wholesaler
Mr Hercules suggested that he come back to the Committee on the definition of the 'concept of distributor and wholesaler'.

Kwazulu Natal
Mr M Bhengu presented the mandate and indicated that the province would support the Bill.

Limpopo
Ms C Nkuma presented the mandate and indicated that the province would support the Bill.

Mpumalanga
Please refer to Appendix 3.

Mr B Tolo under the Deputy Chairpersonship of Ms Nkuma, presented the mandate.

Clause 8
Mr Durr said that in his understanding children under the age of 18 would now be allowed to do waiting or become trainees in restaurants if the amendment is effected. He was uncertain if this would be the case.

Mr Setona said that the broader youth movement lobbied him on the Bill. In his opinion the youth must not be deprived of education and training in terms of the Skills Development Act. Hence, he would support the proposed amendment. He saw the proposed amendment as an emphasis by the province for the youth to be allowed access to education and training as early as possible.

Ms N Ntwanambi (ANC Western Cape) largely agreed with Mr Setona but added that the history of the country could not be overlooked as it related to alcohol abuse and called for careful consideration when the Committee made the final decision as it related to age.

Mr Durr added that the government had just reduced the age for sexual consent to 16 and 12 years, and that a child could have an abortion without parental consent. He found this ridiculous because they were discussing a proposed amendment that was supposedly intended to protect a child.

Mr Tolo explained that the proposed amendment is intended for the protection of children, specifically in the wine industry. The province is merely suggesting that, as a precautionary measure, rather reduce the risk of exposing the younger than 18 years to liquor.

Mr Rama formed the impression that the province is making reference to people in full time employment (although it is not stated absolutely clearly stated, he admitted). He mentioned the many young people who were employed in various outlets to raise funds for themselves. He suggested that the Committee consider drawing a distinction between full time and casual employment in the industry.

Clause 36(1) and (2)
Mr Rama said that essentially the two points are related to the same point regarding the registrant. The intention behind this clause was not to allow a licenced person to recklessly draw profits from the industry and to divorce himself from the responsible running of that sector of the industry he was licenced to operate in. He cannot , for example, say (Clause 36(2)) that he issued his employer with a certain instruction and if the person failed to carry it out, divorce himself from that decision. No Act can say that a person is guilty because there are procedures to be followed.

Northern Cape
Mr Tolo presented the mandate on behalf of the province. The province supported the Bill.

North West
Mr Z Kolweni (ANC ) presented the mandate. He indicated that it became clear to him during his briefing of their committee, that they only discussed the first submission of the Bill and asked for an extension to allow them to cover the Bill completely.

The Chairperson advised that they be informed of the many changes effected since the first draft and that they should familiarise with the latest contents and developments.

Western Cape
Please refer to Appendix 4

Mr Durr presented the mandate. He referred the meeting to the crux of their proposal - firstly, the current wording of Clause 4(7). In giving clarity (Explanatory Memo (5)), he explained that the current standing of the Bill affected especially, on consumption licence holders such as bed and breakfast operations in smaller towns who were dependent on the local retailer to source their supplies. Secondly, ring fencing the legal responsibilities of the province.

The Chairperson reminded that the retail industry is actually regulated by the provinces. There was therefore no need to provide for legislation in the Bill on the content of the retailer's licence.

Mr Rama was of the understanding that this provision was intended to address this concern. But, since Gauteng similarly raised the concern, the Department would undertake to revisit the provision with the aim of clarifying the misunderstanding.

SAPS Submission
The Chairperson informed the meeting that the SA Police, Pretoria made a submission to the Committee. The essence of the submission suggested that under the previous law, they were able to go into an area to seize liquor. When they went to court it was not necessary for them to prove the nature of the liquor. As the law stands now, they would have to prove, by forensic method, what the nature of the liquor was. They requested that the Committee consider inserting a clause in the Bill that would avoid them having to go through this proof process.

Mr Setona suggested that the concern was covered under the definition of a Peace Official.

Mr Durr wanted to put on record that the Western Cape still had a problem with the definition of a micro producer. He asked whether the definition was determined by the volume of production or otherwise. They engaged the Department on the problem and were waiting on a sensible response.

The Chairperson said that it was good to engage the Department but he thought that it was the province that determined the volume. In his understanding there could only be a micro producer or a producer and nothing in between.

The Chairperson returned to the police's submission. He was now of the understanding that the enforcement of the Bill was the competency of the inspector, not the police. The police could be called upon to assist the inspector.

Mr Rama indicated that historically, the police were only involved with raiding unlicenced shebeens and taverns, which in a sense were retail sales. So, for them to be empowered at that level it would have to be in provincial legislation. This Act relates with reference to inspectors, only to the manufacture and distribution of liquor at that level. With respect to the police involvement at national level with manufacture and distribution, the Act provided for the Minister to appoint any person as an inspector and if circumstances warrant for the appointment a police official at that level, the Minister would consider it. Notwithstanding, it would also provide for inspectors to be assisted by police. As far as retail is concerned, it had to be a provincial competency.

The Chairperson announced the end of the mandate submissions.

Ms Nkuna asked when the final mandates were due and if the Bill would be finalised by end 2003.

The Chairperson suggested that on return of members in November, the provinces must come with the final mandates.
Mr Durr suggested that the delegates return to their provinces on the amendments that were brought to the committee and formulate their final mandates in conjunction with the considerations of the Department.
The Chairperson said that whatever interaction took place with the Department, would have to be before they return for the finalisation of the Bill.

The meeting was adjourned.

Appendix 1
Free State Legislature
Report on Negotiating Mandate on Liquor Bill

Appendix 5
SOUTH AFRICAN POLICE SERVICE