Report on Oversight visit to KZN & Gauteng prompted by recent unrest

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Trade, Industry and Competition

20 August 2021
Chairperson: Mr D Nkosi (ANC)
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Meeting Summary


Tabled Committee Reports

The Portfolio Committee on Trade and Industry met on a virtual platform to give formal consideration to its Report on the Portfolio Committee Oversight Visit to Gauteng and KwaZulu-Natal in the light of the unrest in Gauteng and KwaZulu-Natal in July 2021.

Following the presentation of the body of the report at the previous Committee meeting, inputs into the concluding remarks and recommendations had been received from the ANC, the DA and the ACDP.  The ANC and ACDP inputs were accepted by all Members. However, a number of the proposed points by the DA were contested and had to be voted upon. The voting resulted in the exclusion of some of the DA points which pointed specifically to the actions of the Minister of Trade, Industry and Competition, as well as the Minister of Police. Discussions focused on the mandate of the Committee and what could be expected of Committee Members in regard to its oversight role.

The report was adopted for presentation in the National Assembly the following week.

Meeting report

Opening remarks
The Chairperson had to wait until there were at least six Members on the meeting platform as the Committee was meeting to adopt the Report on its oversight visit to KwaZulu-Natal and Gauteng.

Report on the Portfolio Committee Oversight Visit to Gauteng and KwaZulu-Natal
The Committee Secretary noted that input into the conclusions and the recommendations had been received from the ANC, the DA and the ACDP.

The inputs had not yet been collated and the Secretary read the inputs provided by each party, beginning with the ANC inputs to which there were no objections. He then read out the inputs from the DA, noting that he had revised each point to a more appropriate style for a Committee report.

Mr D Macpherson (DA) accepted the first amendment of a DA conclusion about the role of the state to protect lives and property but objected to the second one. The DA did not approve the secretariat’s amendment to its input stating that the unrest was instigated by the Mayor of eThekwini who had supported the free Zuma campaign. The secretariat had removed the direct reference to the Mayor.

Mr Macpherson stated that the Committee could not pretend that it did not know who the instigators were. When they had visited sites, Members had seen exactly the same slogans and hashtags used by the individuals, including the Mayor, on the walls of looted buildings. Prominent individuals should be noted.

The Chairperson noted that the DA wanted its input unchanged. He stated the Committee would return to the point when the decision-making process got underway.

The Secretary read the following point which was largely covered in a conclusion crafted by the ANC and the DA’s additional point about job losses would be added to that concluding point. He read the following point which had been amended by the secretariat to avoid naming the Minister of Trade, Industry and Competition directly.

Mr Macpherson stated that his point referred to the fact that it took Minister Patel 18 days to get to KwaZulu-Natal after the looting. Members of Parliament and businesses had pleaded with him to come to KwaZulu-Natal but he had ignored them and when he had visited after 18 days, he had taken a few selfies in a burnt-out factory and gone on his way. The Committee was not a ‘committee of government’ but a Committee of Parliament that had oversight over the Minister and had to call him out. The Committee had to take a view on his lethargic response. They knew who the people were and could not pretend that they did not know who the people were. To omit calling out the Minister was a very soft touch to a very big problem and was borderline dereliction of duty. When one had one job to do and could not do that, those people had to be called out for not doing their job.

The Chairperson said that it was more a case of interpretation rather than “we know who they are”. The Committee should consider whether there was confirmation of such role players. If it was factual that they knew who the people were, it had to be confirmed as fact.

Mr Macpherson said that it was a matter of record that Minister Patel took 18 days to visit KwaZulu-Natal. The secretariat could not change his input so that the Committee said in its report that government should have been there. It was not government generally, but Minister Patel. Minister Didiza was in KwaZulu-Natal within three days. Minister Patel was absent, unavailable and unwilling. Mr Macpherson reiterated that it was not a fictional story and there was evidence. The Committee had a singular duty to provide oversight over the Executive and the Executive Member over whom that Committee had oversight was Minister Patel and he had failed to do his job; the Committee should express its view on that.

Ms J Hermans (ANC) asked about the procedure. Was the Secretary presenting the points for inclusion?

The Secretary stated that he was first presenting the inputs and the Committee would then decide whether to include the points or not.

The Chairperson agreed that the meeting should move on to the next point submitted by the DA.

The Secretary moved onto the DA recommendations but stated that, procedurally, he viewed the proposed DA recommendations as conclusions, not recommendations. Three of the four points were already included in the conclusions and the final recommendation addressing the Minister of Police had been revised.

The Secretary presented the ACDP inputs. He indicated that the points were already covered in the conclusions. The final conclusion related to the inadequacy of the police. He presented the recommendations proposed by the ACDP.

Mr W Thring (ACDP) was not in the meeting to speak to the inputs from his party.

Deliberations on the Conclusions to the Oversight Report
The Secretary presented the conclusions by the ANC. There were no objections to the inclusions of points 1 to 15 in the conclusion and point 1 in the recommendations.

1.The Committee noted with concern the nature of the unrest, where it would appear that a first group of rioters had gained access to buildings and premises targeting ATMs, and safes holding cash and other valuables before the masses arrived. This gave the impression that there could have been an orchestrated attempt to destabilise the economy.

2. The resultant direct socio-economic impact on manufacturers, small and micro businesses, informal traders and on workers has already been significant in terms of lost property and loss of income. This loss is still ongoing, as many businesses are still recovering and re-establishing themselves where possible. Therefore, this cost to the economy is expected to escalate going forward, especially as manufacturers may lose their domestic market share due to a short-term increase in imports to meet the resultant local demand.

3.There has also been a knock-on effect on businesses that have not been directly impacted by the unrest, as they have experienced challenges with either lower demand for their products or the ability to access supplies required for production.

4.The Committee is concerned about the impact on the healthcare sector in particular healthcare for patients with chronic illnesses, and the vaccination roll-out programme with several pharmaceutical manufacturers and distribution centres being targeted. This will have a negative effect on the government’s efforts to facilitate economic recovery.

5.Furthermore, the Committee is concerned that business confidence may have declined leading to disinvestment, especially by foreign investors/multinationals, and the impact of this on the broader economy.

6.In addition, the Committee is of the view that black economic empowerment and economic transformation has been dealt a massive a blow, as many of these businesses were not insured.

7.Affected communities were also negatively impacted, as they would no longer have access to certain services and products locally.

8. Where businesses were insured by the SASRIA, the delay in processing these claims may compromise their ability to re-establish themselves. This would lead to an even higher impact on unemployment levels.

9.The Committee welcomed government’s announcement for dedicated financial support of R3,75 billion for the areas affected by the unrest.

10. Given that many businesses directly affected by the unrest have lost critical documentation that would ordinarily be required for financial applications, the DTIC and its development finance institutions should review how best to process these applications from affected businesses.
11.The Committee was of the view that while it is necessary to comply with the strict requirements to ensure accountability, in such cases, flexibility is required to allow affected businesses to access funding thus ensuring that recovery and rebuilding can be fast tracked. The Committee also noted that given the fact that medium-sized enterprises were struggling to comply with these requirements, the impact on smaller enterprises to comply may be greater.

12. However, this flexibility should not compromise its due diligence processes, and financial and other support should be provided swiftly to qualifying businesses.

13. The Committee was of the view that the DTIC should engage the private sector regarding support for the recovery efforts of businesses that have been affected by the destruction and loss of property.

14. Furthermore, as far as possible, government should ensure that available finance should be allocated and disbursed to affected businesses to facilitate the speedy reconstruction and recovery of the economy in the affected areas.

15. The Committee encouraged closer inter-governmental cooperation to ensure an effective and holistic response to the affected businesses so that these local economies can be rebuilt in the shortest time possible.

Informed by its deliberations, the Committee recommends that the House requests that the Minister of Trade, Industry and Competition should consider engaging the Minister of Finance on whether additional public funding could be sourced to assist affected businesses in the areas.

The Chairperson noted that there were no objections and the ANC input was accepted.

The Secretary moved on to the DA inputs : The Committee also noted that the role of the State is to protect and defend its citizens and property; however, the recent unrest has shown significant shortcomings, which resulted in the loss of lives and would have a negative impact on the broader economy. In this regard, the Committee was concerned that the South African Police Service had not adequately dealt with the unrest.
Point 1 was agreed to.

The Secretary read the second point, as re-worked by the secretariat, which condemned the acts of violence and noted with concern the encouragement/instigation of violence by some prominent individuals that further inflamed the situation: The Committee condemns any act of violence against citizens and business properties, but noted with concern the encouragement/incitement of violence by some prominent individuals that further inflamed the situation.

Ms Hermans objected to the inclusion of the point on the basis that the report was a report of the oversight visit and not of occurrences that had happened elsewhere. Members knew that there was a commission of inquiry that would investigate and so the ANC did not agree with including the point.

Mr Macpherson asked why, even if the Committee took the most basic narrow view, would the Committee not want to condemn the destruction it had seen to businesses and properties. Why would the Committee not be concerned about what it had seen? The destruction did not happen in a vacuum. People had not woken up one day and decided to go and do that; it was pushed by prominent individuals such as the Mayor of Ethekwini and the Premier of the Province. One could not deal with problems unless one dealt with the why of what had happened and what the Committee had seen. The Committee would be failing if it expressed itself only on what had happened and not the why of what had happened.

Mr S Mbuyane (ANC) made a point around the allegations against members of government. If the DA had proof of its allegations, it should go to the police or other law enforcement. Those allegations could not go in the report. He agreed with Ms Hermans.

Mr Macpherson was unsure why Mr Mbuyane wanted to relegate the Committee to the status of spectators. Those were not allegations; they were facts. That was what those people had written and their names were attached and they appeared on TV. No one was unsure of who may have said those things. Parliament could not be a spectator; it could not sit on the side lines while people were tearing up the grass, and then complain that the pitch was bumpy. It was not in the best interests of SA for Parliament to bury its head in the sand. He was not being political about the matter: he had not mentioned the party but only the persons involved because it was more important to deal with the problem than bring in the politics of the matter. The facts were the facts. One could not run away from that point.

The Chairperson said that the point was that the report had to look at things relevant to its Trade and  Industry mandate. What Mr Macpherson was referring to was the purview of Police, Intelligence, etc. The Committee could note it, but the Committee did not have oversight over those portfolios and had to pass the concerns to the appropriate portfolio. If it did not help to respond or to take the process forward; it would not add value.

Mr Macpherson said that he and the Chairperson were getting closer to agreement. He thought that the Members were doing themselves, and the businesses that they had gone to assist, a disservice if they were not able to take a line. Everyone knew who had inflamed and ignited the vandalism. Businesses knew; the public knew. The Committee had to look not only at what had happened, but why it had happened. The Committee had every right to pronounce itself on that sort of behaviour and what contributed to what had happened. He compared it to a car crash following which no one wanted to implicate the driver of the vehicle responsible.

The Chairperson agreed that it had been a terrible thing but he was really concerned about ensuring that the Committee played an appropriate role. He had raised a point regarding oversight but he did not know how Mr Macpherson’s point helped oversight. Even if everyone took that kind of view, it was not for Committee to make the statement. It was for relevant Committees to do so. He called for the opinion of Members on whether it was necessary to comment on something that was outside of the scope of the Committee.

Ms Hermans did not believe that they were doing the Committee a disservice by leaving out such points. She had proposed that the point not be included and that proposal had been seconded by Mr Mbuyane but now the Committee was going back to the point again. Mr Macpherson deliberated the same thing over and over. The ANC had expressed its opinion on the matter.

Mr Macpherson said one could tell where one’s responsibilities lay depending on what one did or did not accept. It was clear that it was a difficult issue for some Members as it hit home. He was adamant that it had to be included in the report because the Committee had to call out the agitators and the politicians who had fuelled the flames. It was a reflection on certain Members of the Committee.

The Chairperson said that a view had been moved and seconded by Members and there was no seconder for Mr Macpherson’s position.

Mr F Mulder (FF+) had had connection problems. He seconded Mr Macpherson’s proposal.

The Chairperson requested the Secretary to call a vote.

Motion: The ANC proposed the non-inclusion of the DA point in the Conclusion to the Oversight Report:
The Committee condemns any act of violence against citizens and business properties, but noted with concern the encouragement/incitement of violence by some prominent individuals that further inflamed the situation.

Mr Z Burns-Ncamashe (ANC) – supported
Mr Mulder – against
Mr Macpherson – against
Mr M Cuthbert (DA) – against
Ms N Motaung (ANC) – support
Ms R Moatshe (ANC) – support
Ms Hermans – support
Mr S Mbuyane (ANC) – supported

Five Members voted in favour of exclusion of the point and three Members voted against exclusion. The point was excluded from the report.

The Secretary presented the third conclusion point suggested by the DA, and as revised by the secretariat. Because it extended the point on the cost to the economy, would be an addition to a point proposed by the ANC: Further, the Committee noted that the cost to the economy would be additional job losses.

The Committee approved the point.

The Secretary read the fourth point proposed by the DA – the DA had rejected the secretariat’s rewriting of the point: It took Minister Patel 18 days to get to KwaZulu-Natal after the looting and destruction first began, despite pleas from businesses and local politicians, which he ignore. The lack of visibility did not help the situation nor build confidence that government was serious about the issues that mattered to the business community.

Ms Hermans did not support the inclusion of the point. Government worked as collective and other Ministers had been there. The Minister would be coming to the Committee to account, so they could not presume anything at that stage.

Mr Mbuyane seconded the proposal to not include the point. (Poor connection.)

Mr Macpherson said that, as many speakers had frequently said, the purpose of Parliament was to provide oversight of the Executive. The Committee was doing oversight. The sole job of that Committee was to do oversight of the Minister of Trade, Industry and Competition, and he had failed to do his job. It was not grandstanding, as the ANC like to label arguments that they could not counter. It was a matter of fact that it took the Minister 18 days - nearly three weeks after the chaos had ensued - for the Minister to come down, besides the fact that politicians and businesses had begged him to come. He had ignored them until media pressure forced him to come. He took a few selfies in burn-out warehouses, posted them on social media and left. If the Committee was not prepared to express itself on that, then what was the point in being a Member of Parliament when one was not prepared to express oneself on the failure of the one person over whom the Committee had oversight? One had to question the existence of such people in Parliament.

Mr Cuthbert supported the inclusion of the point. It was extremely important to respect the separation of powers, even if the Minister was a member of the same party. (Connectivity interruption) Members needed to rethink as they could not whitewash behaviour as that was not an accurate reflection of what had actually happened.

Mr Burns-Ncamashe said that it would be naïve to expect him to take a different standpoint from that of the ANC, not only because it would be a revolutionary position, but because the ANC took decisions in the interest of the broader population of SA which was inclusive of every sector and not only those that were akin to a narrow, pro-exclusive interest, as the ANC Members had witnessed in the fact-finding oversight sessions. Something that was so glaringly disappointing was that colleagues from DA, whenever they visited industries exclusively owned by white captains of industry, had excluded themselves from the rest of the Committee and had had their own sessions outside of the meetings. He had to say that they could not save themselves from that kind of behaviour which was not good because it reflected badly on them. It was something that they needed to know. The Committee also went to the black townships, where instead of getting themselves into what was there, they had given all sorts of reasons to stand back, such as social distancing, instead of getting their hands in, in the interest in SA. It was important to raise those issues so that people could be seen for who they were, not what they purport to be.

The Chairperson called for a vote on the ANC’s proposal not to include the DA’s point: It took Minister Patel 18 days to get to KwaZulu-Natal after the looting and destruction first began, despite pleas from businesses and local politicians, which he ignore. The lack of visibility did not help the situation nor build confidence that government was serious about the issues that mattered to the business community.

Mr Burns-Ncamashe – agreed to the exclusion
Mr Mulder – disconnected
Mr Macpherson – against exclusion. He said been a Member for seven years and had never heard such claptrap as that from Mr Burns-Ncamashe. It was points scoring and grandstanding.
Ms Hermans called for a point of order: it was not parliamentary to say that someone was talking claptrap.

Mr Cuthbert commented that Mr Macpherson was speaking the truth.

Ms Hermans responded that it did not matter if it was the truth; it was not parliamentary.

The Chairperson said insulting each other did not help. He called for decorum and asked that Members treat each other with respect. The way they were going was simply time wasting.

Voting continued:
Mr Cuthbert – against exclusion (He added that the double standards of the Chairperson had been exposed.)
Ms Motaung – supported exclusion
Ms Moatshe – supported exclusion
Ms Hermans – supported exclusion
Ms Mbuyane – supported exclusion

The Committee had voted to exclude the DA’s point in the report.

The Secretary presented the DA’s recommendations but added that the secretariat recommended that the points be considered as points under conclusions.

Mr Macpherson said that to show he was not petty and unreasonable; he would agree to consider the points as concluding points.

The Secretary asked Mr Macpherson if he approved of the secretariat’s rewording of the point.

Mr Macpherson did not approve because his proposal was that the Minister of Trade, Industry and Competition should call on the Minister of Police. In the approved conclusions, the ANC and the ACDP called on the Minister of Finance to do x and y. Now, when the DA called on the police to protect lives going forward, the Committee said that they could not address an issue outside of their portfolio. It had to be consistent: one or the other.

The Secretary explained that the previous point was in line with government’s response to the support that should be provided for trade and industry. It referred to additional funds that dtic was sourcing for the recovery of the economy.

Mr Macpherson said it was within the right of the Committee to call on the Minister of Police, through the Minister  of Trade, Industry and Competition to determine the capability of the police to protect lives and property in the event of a similar situation in the future. The point remained as a DA recommendation.

Ms Hermans supported the acceptance of the reworded point as a concluding remark.

Mr Cuthbert supported Mr Macpherson’s proposal to include the original wording.

Mr Mbuyane seconded Ms Hermans’ proposal.

The proposal was put to the Committee: That the point be moved to Conclusions and the reworded version be used.

Mr Burns-Ncamashe – supported the proposal
Mr Mulder – against
Mr Macpherson – against
Mr Cuthbert – against
Ms Motaung – supported
Ms Moatshe – supported
Ms Hermans – supported
Mr Mbuyane – supported

The Secretary announced that five Members supported the moving of the reworded point to the conclusions; there were three votes against.

The Secretary presented the ACDP input. The first four points were similar to those presented by the ANC and approved. The fifth concluding point stated that the South African Police Service had not dealt adequately with the unrest.

Ms Hermans and Mr Mbuyane supported the inclusion of the point.

The sixth point from the ACDP referred to the deficit of Intelligence as the threats from those supporting former President Zuma had not been taken seriously. The secretariat had reworded the point taking out the specific reference to former President Zuma.

Ms Hermans said that, as far as she was aware, there was an ongoing investigation into matters relating to the Security Cluster. The point presented Mr Thring’s impression, but she did not know if it was a fact so she was not comfortable and she proposed it be excluded.

Ms Motaung seconded Ms Hermans proposal for exclusion.

The Secretary noted that several points from the ACDP were already in the concluding remarks. The ACDP had proposed a point suggesting that a national preventative strategy be sent to all businesses. The secretariat proposed a rewording: The Committee would like to encourage private business to explore developing preventative mechanisms that would ensure its protection which should include insurance and security, among others, to mitigate against possible future unrest.

Ms Hermans supported the inclusion of the point.

There being no objection, the point was included as a concluding remark.

The Secretary requested a five to ten minute break to compile the final concluding remarks and recommendations before presenting them to the Members for approval.

On re-convening, the Secretary flighted the finalised Conclusions and Recommendations to the oversight report as advised by the Committee.

Resolution: The Chairperson put the Report on the Portfolio Committee on Trade and Industry Oversight Visit to Gauteng and KwaZulu-Natal to the Committee.

Ms Hermans proposed the adoption of the conclusions and recommendations as presented. Mr Burns-Ncamashe seconded the proposal.

The Chairperson declared that the Report on the Portfolio Committee on Trade and Industry Oversight Visit to Gauteng and KwaZulu-Natal had been adopted by the Committee. There were objections.

Concluding remarks
The Secretary informed Members that the report would be included in the Announcements, Tablings and Committee Reports (ATC) that evening as Parliament would debate the reports in the course of the following week.

The Secretary announced a change to the Committee Programme. The meeting arranged for dtic to present its response to the public’s submissions on the two Bills remitted by the President on Friday 27 August 2021 would be postponed as Parliament had arranged a Women’s Day event on that day.

The Chairperson stated that the matter would be raised at the meeting on 24 August 2021. He concluded the meeting.

The meeting was adjourned.


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