Free State Economic Recovery Plan; Employment Equity Amendment Bill

NCOP Trade & Industry, Economic Development, Small Business, Tourism, Employment & Labour

23 November 2021
Chairperson: Mr M Rayi (ANC, Eastern Cape)
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Meeting Summary


The Department of Employment and Labour (DEL) wanted the Select Committee to amend section 42(1)(a) of the Employment Equity Act from stating "national and regional" to "national or regional" when considering the equitable representation of designated groups within each occupational level in an employer’s workforce. The Select Committee was given legal advice about adding an amendment to a section not included in the Employment Equity Amendment Equity Bill [B14B-2020]. Consequently, the Committee decided it was not procedurally possible for NCOP to made that addition.

The Free State Department of Small Business Development, Tourism & Environmental Affairs (DESTEA) reported on its economic recovery plan. The MEC noted that the Free State economy had been in decline since 2011 as agriculture – which used to be the major contributor to the Free State economy – is now stagnant. The Free State Development Corporation (FDC) spoke about its efforts with the industrial parks and SEZ although it did state that these were under pressure due to the pandemic. Mangaung Metro, which is under a Section 139 intervention, spoke about its challenges and efforts to recover.

Transnet Freight Rail and the Department of Trade, Industry and Competition (DTIC) also presented on their efforts in the Free State to encourage economic recovery.

Committee members raised the following concerns: adequate rail transport for freight; if the DESTEA and FDC interfaced with their economic development programmes; what can be done to prevent Botshabelo Industrial Park from collapsing; the number of small businesses benefiting from programme for big retailers to sell their products; why the agriculture sector is stagnant and GDP has declined; the cost for moving the Thaba ‘Nchu smelter; addressing unregulated traders; the challenges encountered in implementing the Free State Procurement framework; the scope of SME distress and what assistance and incentives are going to be given.

They asked about Mangaung Metro's measures to ensure debt collection by the municipality for municipal services; Mangaung debt service payments; its R270 million debt to Bloem Water and failure to honour its agreement; the effect of the water restrictions to a 30% flow; the worrisome 2019/20 audit findings; and if it is currently running a funded or unfunded budget. The Committee asked how national and provincial government had assisted during the intervention.

Due to time constraints, Mangaung, Transnet and DTIC were asked to provide written responses.


Meeting report

The Committee discussed the legal opinion written by Chief Parliamentary Legal Adviser Adv Zuraya Adhikarie on the Department of Employment and Labour’s proposed amendment to section 42(1)(a) of the Employment Equity Act from "national and regional" to "national or regional" when considering the equitable representation of designated groups within each occupational level in an employer’s workforce. The legal opinion recommended that:
- The Committee seek the advice of the NCOP Table to determine if the proposed amendment is procedurally in order in terms of the NCOP Rules;
- If procedurally sound, consult with the Chairperson of the Portfolio Committee about her reasons for not proceeding with this amendment as this is a section 75 Bill and it will have to go back to the Portfolio Committee;
- If the amendment is proceeded with, the Committee is to ensure that there is public participation.

The State Law Advisor said that the NCOP Rules do not prevent the Committee from proposing an amendment to other sections of the principal act. In deciding if to consult the Portfolio Committee Chairperson, the Committee should consider that s75(1)(c) still requires that the Bill will be referred back to the National Assembly if they propose to amend the Bill. It is the discretion of the Committee on if it wants to consult the Chairperson or not.

Ms Shamara Ally, Procedural Officer at Parliament, noted that the Constitution in terms of s 75 is very clear. The NCOP can either pass a section 75 Bill subject to amendments or reject the Bill. However, Section 42 is being amended and this section is not contained in the Amendment Bill. The interpretation is that an NCOP Committee will only consider a bill that is before it. They cannot read into the Bill or interpret provisions into the Bill which is the current request from the Department. The Bill has already been through the National Assembly process and the public participation process. The Bill was then sent to the NCOP. The Department cannot now propose an amendment that is outside the provisions that form part of the Bill that was referred to the NCOP. This will go against NCOP Rule 210(1)(h) which strictly prohibits a committee from considering amendments that will render a Bill constitutionally or procedurally irregular. It is for this reason that it is recommended that the proposed amendment not be proceeded with by the Committee. Should the department want to proceed with this amendment, they should do so via an Amendment Bill in the National Assembly as the NCOP does not have the power to initiate a new Bill. It is for this reason that the amendment is procedurally irregular.

The Committee agreed that they will proceed with the Bill before them from the National Assembly. If the Department wants to make amendments, it will have to make amendments after the Bill has either been adopted or rejected by the NCOP.

Free State Department of Small Business Development, Tourism & Environmental Affairs (DESTEA)
Mr Makalo Mohale, Free State MEC of DESTEA, said Free State GDP was last high in 2011. Agriculture, which used to be the major contributor to its economy, is now stagnant. Community service now takes the larger share in its contribution to its economy (see document).

• Aggressive infrastructure investment
• Energy security
• Tourism recovery and growth
• Strategic localization, reindustrialization, and export promotion
• Green economy interventions
• Macro-economic interventions
• Mass public employment interventions
• Food security
• Economic inclusion of women and youth

• Resource mobilization
• Supportive policy environment for ease of doing business (red tape reduction)
• Capable State
• Skills Development
• Economic diplomacy and integration into the African continent

Enterprise Support incentives
• Industrialisation Support Incentive
• Retail support initiative
• Supplier Development Initiative
• Access to markets
• Business Development Support.

Free State Development Corporation (FDC) briefing
Mr Thabo Lebelo, FDC CEO, explained the role of the FDC
- Initiate economic empowerment projects that would benefit the Free State
- Assist Free State-based small, medium, and micro-enterprises in financial distress
- Provide funding to Free State-based small, medium, and micro enterprises
- Initiate economic empowerment projects that would benefit the Free State
- Identify, analyse, develop, package & publicize investment opportunities
- Promotion and development of the small, medium, and micro enterprises.

Industrial Parks Overview
The industrial parks are situated in Maluti-a-Phofung, Botshabelo and Thaba Nchu, while the Maluti-A-Phofung Special Economic Zone (MAP SEZ) is situated in Tshiame. The industrial parks consist of small (50-499m2) and large units (+500m2).  Phuthaditjhaba Industrial Park is strategically located in the Eastern Free State and is 40km away from N5 and N3 highways along the border between Gauteng and Kwazulu-Natal. The Botshabelo Industrial Area is 53 km from Bloemfontein on the N8 towards Lesotho and is one of the main drivers of the Mangaung Metro economy.  Our tenant profile includes the following sectors: Textile, Plastic Products, Poly Propylene Bags, Poultry, Food and snacks, Packaging, Paraffin Stoves/Hot plates, Plastic packaging, electrical transformer manufacturing.

Incentives provided
The property department aims to utilize property space to facilitate commercial and industrial activity while assisting new investors who are seeking suitable rental premises. The following incentives are provided: subsidized rental rates; rental holidays of up to three months; other special incentives – such as amortising tenant capital investment over the lease term.

Strategic Objectives: increase rental revenue; increase rental occupancy; increase the number of private-sector partnerships to utilize vacant/vandalized properties to facilitate job creation. The private sector has funding and expertise too.

- Revitalization of three Industrial Parks: Botshabelo, Thaba Nchu, and Phuthaditjhaba parks
- Revive AgiParks partnership with Department of Rural Development (Phuthas, Tshiame, Thaba Nchu)
- ICT Digital Hub – In partnership with MAP TVET College and SEDA in progress;
- Collective training for Industrial sectors in the park on Textile manufacturing skills.
- Student Accommodation in Phuthaditjhaba Industrial Park.
- Revitalization of Shopping Centers with Private Partnerships.
- Partnership with Maluti Tvet College and SEDA in establishing Centre for Entrepreneurial Rapid - Incubator in the Phuthaditjhaba Industrial Park.
- Phase Three roads reticulation upgrades within Botshabelo and Phuthaditjhaba industrial parks assisted by Department of Trade, Industry and Competition (DTIC) with DBSA as implementing agent.

Major Infrastructure Projects
- Steel Smelter Projects – R300m (ThabaNchu)
- Development of the N8/Mahungra Node (project in the planning stage)
- Revitalisation of the Bloem Industria with Mangaung Metro (project in planning stage).

Mangaung Metro presentation
Acting City Manager, Mr Sello More, said Mangaung’s economy is the largest contributor to the GDP of the Free State (R98.1 billion) and is also one of the most diversified. Between 2008 and 2017, Mangaung had an average of 2.3% economic growth rate. This is credited to the performance of the tertiary sector and in particular, the community sector.

Financial Health (Viability and Sustainability)
Mangaung has been under a Section 139(5)(a) and (c) intervention since Jan 2020. A mandatory Financial Recovery Plan has been developed, approved and is being implemented. The City is still not in a position to afford borrowing for CAPEX funding. It obtained an unqualified audit outcome for 2019/20. The City is up to date with budget implementation as the 2021/22 IDP and 2021/22 MTREF budget was approved by Council on 31 May 2021. The 2019/20 Annual Report was tabled at Council on 04 June 2021 and referred to the Municipal Public Accounts Committee (MPAC).

Outstanding Debt
Mangaung is faced with financial challenges due to its high debt book. Total debt owed to the City amounts to more than R7.2 billion. Residential debt represents more than 56% of this:
Domestic  R4.1 billion
Government R1.9 billion
Business  R1.2 billion

Maintenance of Road Infrastructure
The total road network is 3831km of which 2200km is unpaved. 90% (1350km) of road surfacing is in poor condition and 35% (515 km) is in very poor condition. There is an approved R96.3 million budget for 2021/22 for resealing. Budget deficit per annum is R804.4 million for the next 10 years. R112 million/annum needed for resealing/resurfacing of paved roads for the next 10 years. R891 million/annum is required for upgrading from gravel to tarred roads for the next 10 years which excludes informal settlements. Total required capital investment/annum for the next 10 years is R906.7m

Provision of Electrification to Formal and Informal Settlements
- Connecting 1 500 households in informal settlements, the city will spend R39 million
- Undertake feasibility studies for solar generation project to the value of R1.5 million
- Installation and upgrading of bulk infrastructure to the amount of R236 million
- 28 high mast lights will be installed to the value of R14.5 million
- 15 high mast lights at the design stage and together with construction will amount to R7.5 m
- Almost 5 037 households in informal settlements still require electricity provision and the City needs an intervention to the value of R131 million.

Delivery of Waste Collection
- Waste collection and management in the City is still an immense challenge. It spends annually R250m on waste collection only, but always over-spends by more or less R50m due to overtime and lack of tools of the trade
- Domestic Waste:
The collection is regularised in Botshabelo, Thaba Nchu
Waste is collected once a week in Van Stadensrus, Wepener, and Dewetsdorp, in line with the law, but not on regular days, but weekends
Waste is collected once a week in Soutpan, as in Naledi due to resource challenges
Bloemfontein, our biggest challenge, largely depends on excessive overtime
The City has just appointed personnel with plans afoot to regularise
The collection also covers informal settlements
- Landfill sites: Operations challenging, due to machinery shortage. Plans are almost complete for Environment Department (DEFF)-aided improvements at the Southern Landfill Site.
- Public Spaces: Operations not going well. DEFF to assist with illegal heaps removal, COGTA as well, with once-off programme and the usage of EPWP and shift system.

Mr M Dangor (ANC) asked if there is adequate rail transport for example between Bloemfontein and Botshapelo. He asked if there are plans to have rail transport running in that area. There are two roads for trade, one is a financial and the other is a physical road. He is concerned about both. The DBSA and IDC are all civil funders, he asked how they are going to translate their funding to get down to local people and get other banks involved to fund other things that need to be funded for development.

Mr Dangor noted that agriculture is also very low in the Free State. Although agriculture is a challenge, exports are also an issue. Free State could look at goods such as wheat, beef and sheep for export.

Mr M Mmoiemang (ANC) asked at what stage do the MEC and FDC economic development programmes interface. It is also important for the Committee to get a sense of these sector plans in Mangaung Metro and how far are they. Given that Mangaung is the biggest contributor towards the Free State GDP, one would expect that these sector plans are an integral part of the Mangaung Local Development Plan.

The failure by stakeholders, especially government, to pay for their municipal services. He asked the MEC what measures have been put in place to alleviate this burden on the municipalities. One would expect government to play a leading example in paying for services. Treasury can play a role in ensuring that all government departments honour their dues.

Mr Mmoiemang noted that the MEC said that Botshabelo Industrial Park is close to collapse. What can be done to attract investment to ensure the industrial park is taken to an improved level?

Ms B Mathevula (EFF) noted the Free State presentation stated that retail supermarkets like Pick n Pay has a programme to assist selected small businesses to put their products on supermarket shelves. However, it did not indicate how many small businesses have benefited from this initiative. She asked for a breakdown. Also, besides retail supermarkets, does Free State have a programme to engage government departments about using small businesses in the area.

Ms S Boshoff (DA) said that the MEC noted that the GDP has declined. She asked why GDP has declined as the reason is not COVID-19 because it had been declining before the pandemic although it also had an impact.

It is worrisome that agriculture is stagnant and not growing. The Department should sit down with the Department of Agriculture and Land Reform to see how Free State can be assisted as this will affect the food basket and they cannot rely on international markets any longer.

She asked the Department how many disabled people are employed in the various sections.

On moving the Thaba Nchu smelter, they keep on saying that they will retain the employment rate at about 2000. She asked for the cost of moving the smelter from one place to another.

What steps are they going to take to address unregulated and illicit traders?

Lastly, she asked about the impact on wildlife if festivals are held in the nature reserves.

To FDC, she asked what kind of funding was given to the SMEs and the amount. How many of these SMEs are in distress, what is the scope of the distress and what assistance will be given?

Mangaung has debt service payments for the DBSA and Standard Bank loans of R51.1 million. She asked what is being done about this. The biggest current problem for Mangaung is the high water account at R270 million with the last payment made in June 2021. This means that Mangaung failed to honour its agreement with Bloem Water. It also owe the electricity provider. Another problem is that water restrictions impact the flow sometimes to 30% flow so how does Mangaung provide water if they are only on a 30% flow. as 52% of people are on piped water provision.

The 2019/20 Auditor General report for Mangaung is worrisome. Contracts were awarded without the required declaration, quotations were not obtained, unauthorised expenditure now stands at R1.3 billion, uncollected debtors stands at R3.6 million, material losses at R350 million, water losses at R187 million. She asked the Free State province what has been done by it and the national government on the Section 139 intervention. She does not see any proper financial management, and this is why Mangaung is going backward instead of forward.

Lastly, on the integrated transport network, she noted that this has been in the works for years but there is absolutely nothing to show especially for Mangaung to Thaba ‘Nchu. She wanted a breakdown of what the cost is and when they will take this up again. And if they do, she suggested that they must do so in line with the public transport strategy.

Ms M Moshodi (ANC) noted that the MEC mentioned that the Botshabelo ICT has been completed. She asked for the applicable date for DESTEA to launch this hub. She asked if the MEC considered inviting the NCOP for oversight.

Ms Moshodi said the MEC noted that the Thabong Industrial Park has more than 1000 people deployed and the majority are women. She asked if they considered youth and people with disabilities.

She noted that the Free State Development Corporation mentioned three projects on the way that have started already. She asked if these projects are still within their time frame.

She said that Mangaung Municipality was in the news on 22 November as people from Mangaung were complaining about not getting water. She asked the City Manager what the problem is. She also asked about the City's vacancy rate and when it will fill these posts, especially critical ones.

Ms S Boshoff (DA) asked from the Acting City Manager if Mangaung is currently running a funded or unfunded budget. If it is unfunded then they need an intervention as this is against the Municipal Finance Management Act (MFMA).

Mr Mmoiemang asked what can be learned from the implementation of the Free State Procurement framework as presented by the MEC. He asked if there are challenges with it.

He noted that FDC made reference to the steel smelter projects and that the project in Thaba ‘Nchu has to be revitalised. He asked for more details about that.

The Chairperson referred to the incentives provided by DESTEA and FDC for rental subsidies and rental holidays, and asked how far their goal is in sustaining these businesses. Are there businesses that close even if there are these incentives? Are the incentives enough to sustain these businesses or are there other incentives that government and FDC are considering to sustain businesses particularly those that are in the industrial parks?

On the structures that some private companies are assisting in upgrading, what happens when these companies leave? Who will those structures belong to in the industrial parks?

Free State MEC response
Mr Mohale, MEC, replied about the rail between Botshabelo and Bloemfontein saying that he would need to clarify the plans from DESTEA's sister department. What he knows is that the province is concerned about the high cost of the subsidy expanding in excess of R114 million a year just on that line on the bus subsidy. There is one rail portion within Bloemfontein and one industrial area within the city where they are in discussions with the City and Transnet to revive it because it links a very strategic area. If that discussion bears fruit, it will be a game-changer to the City's economic activities.

The decline of agriculture is due to various reasons with drought being one of them. Most importantly the research information they have is that it is the booming of agriculture in other provinces, as opposed to the past where the Free State was relied upon by everyone in the country as well as the export market, has caused this. The development of agriculture and investment in other provinces has provided an alternative to the Free State agriculture. The investment is a drop in the ocean. We lag behind in innovation and technology and production efficiency. Free State is not investing sufficiently.

On the economic master plans, the MEC replied that they are at a consultative stage where they are even consulting local government through the LED forums. The reason they have not publicly gone out and proclaimed the final product of the master plan as part of the economic strategy is that they are still engaging with businesses, local government, and all other stakeholders.

This is the same issue with the procurement framework which is still at a draft stage. Part of the delay is that some concerns were raised such as the current legislative framework and what they want to do in terms of PFMA and MFMA. It has not been implemented as it needs to be given some legislative authority. Enacting their own legislation can make the implementation easy.

The Free State MEC  noted the reason the provincial departments are failing to settle their debt to the Metro is purely based on the inadequacy of resources. The provincial bills in total to the Metro annually exceed R800 million to half a billion and the allocation made to the province it is not anywhere close to that at R500 million. Another concern is that in the past their account has not been serviced sufficiently. It is only the last several years efforts were aggressively made by the Free State to ensure that some municipal accounts were settled. The province still has a dispute on the rates.

Mr Mohale replied that he made the statement about industrial parks being on the verge of collapse in comparison to how those parks were 30 years ago. The biggest traffic in Botshabelo 30 years ago was found in the industrial parks where more than 90% of the factories were operating. Currently, it is very quiet in the parks. What they have realised is that part of the apartheid strategy to keep the people in the Bantustans was they created a lot of incentives to drive a lot of the industries out of the main cities. The tax rate was close to nothing and the government was deliberate in giving assistance and concessions. One of their considerations is to give similar incentives of the SEZ to the industrial parks which they believe would cause people to come.

An empirical study the Department has made is that the cost of doing business in the Free State is very high. They had done comparisons with their metro rates to other metros such as Buffalo City and Cape Town and found that their metro has more costs so a business is unlikely to move to Botshabelo to operate there.

On the sustainability of incentives, Mr Mohale replied that to start with the amount of money is insufficient. But they need to start somewhere because they cannot always speak about industrialisation without action. They started this year in May with R10 million. They believe that with that R10 million – if not reduced – they can still carry these businesses because the province is targeting mainly those that are start-ups that need capital injections. With these grants, a substantial number of those applied because they were going out of business. So the money helps those that are already in the industrial parks to stay afloat. The bigger picture the Department sought to achieve with these incentives is going to be hard to achieve unless there is a drastic change.

The Free State MEC  replied that the Pick n Pay programme is a new programme. They are still at the phase where those small businesses identified for the programme are still undergoing testing and training.

The reason for the decline of the GDP is that economic activities have declined in the province. Some businesses have left. They need to reindustrialise the province so there are industrial activities.

The Department would need to look for the information on people with disabilities employed in their factories.

The smelter project is privately funded and government has not invested any money. The only role it has been playing is ensuring that the process runs as swiftly as possible. The investor indicated that the cost of moving the smelter from Botshabelo to Thaba ‘Nchu is R8 to R10 million.

On illicit trading activities and non compliance, the first step was to address permits and licensing in municipalities. They need to ensure they have a system that can work by establishing bylaws. The second step is adopting norms and standards. The third step involves enforcement in municipalities. This is where most of the difficulty is found.

On the dominance of women employment in the industrial parks, the MEC confirmed that there  are youth but he would have to verify about employment of people with disabilities.

On the Section 139 intervention in Mangaung, Mr Mohale replied that the province has not reached the level that they intended to reach. It took almost a year for the Council to adopt the plan with some elements of resistance. Some conditional grants were returned unused, projects were incomplete, and grants were used for operational reasons. There used to be salary delays in Mangaung. However, since the intervention there has not been a challenge with payment of salaries. They have seen the start of the use of the grants. Those things have been happening although they have not achieved what they have intended. However, there is at least some notable progress that can be seen.

Free State Development Corporation (FDC) response
Mr Lebelo replied about the SMEs that are in distress and noted that there are two buckets in terms of the monies FDC is owed. The first bucket is the loans FDC advanced to businesses and housing loans. The balance at the end of March was about R365 million and a lot of those amounts are unfortunately unrecoverable. These are loans dating as far back as 1994 which were stopped being given in 2015. He spoke about a business loss of about R184 million which they are battling to find. Not a lot of effort was put into establishing what kind of security would be given to the FDC so that they can go after those people.

On the mortgage bonds, the book is running down, and it has good security sitting at about R200 million. There they will be able to recover everything, but they are mindful of putting women and children out of their homes where they cannot pay. Therefore, they look at each house individually and work out how best they can recover the money.

FDC has what it calls bridging loans. People came and borrowed money from the FDC to execute orders and the departments were supposed to pay the money directly to FDC and then it would give the supplier a share, but for whatever reason, all the money was paid to the supplier. FDC is working with Treasury to see who these companies are and if they still do business with government and in some way chase them down and try to get the money. If they are in distress or not, the FDC is not sure.

Some people who have occupied their factories and are struggling to pay rent due to COVID-19. There is a mandate in terms of the FDC Act where it is compelled by law to work with anyone in financial distress. Therefore FDC enters into arrangements with them; for example, giving them a six-month breather. The amount of rent FDC was owed at the end of September is in the region of R370 million but the bulk of that is people who came and have left.

On the structures, he noted that it is either the business constructs a new structure or upgrades what is there. When the lease ends the improvements revert to the FDC.

Mangaung Metro response
Due to time constraints, the Chairperson requested that Mr More send written responses to the questions directed to the Acting City Manager.

Deputy Minister of Trade, Industry and Economic Development overview
Deputy Minister of Trade, Industry and Economic Development, Ms Nomalungela Gina, noted that DTIC has put more strategic effort in localisation in industrialisation as part of the strategic drive for economic recovery. Free State is among the provinces DTIC is giving financial support especially for retaining and creating jobs.

DTIC presentation on Free State
Mr Stephen Hanival, Chief Economist: Department of Trade, Industry and Competition (DTIC) said that the Free State economy, much like the South African economy, is characterised by structural challenges which derail growth, development and transformation. The Covid-19 pandemic sharply exposed these fundamental structural challenges. The SMME sector became the biggest victim of the effects of Covid-19. The Free State Province real GDP increased by 1.3% (q-on-q) in 2021 Q2, following another positive growth of 3.5% in 2021 Q1. The structure of the provincial economy (Finance, Wholesale, Manufacturing, Transport & Mining) has mitigated the economic impact but youth unemployment and poverty remain critical.

Mr Hanival spoke about the DTIC Skills for the Economy Unit. Its role is to advocate and facilitate the implementation of evidence-based and demand-driven skills policies, instruments, and programmes that are responsive to the economic needs expressed in the Master Plans, SEZs, the development of Black industrialists and contribute towards greater productivity and competitiveness of the SA economy. This is achieved through the development, implementation and advocacy of skills instruments and programmes in support of industrialisation, regional industrial development, and inclusive economic growth (see document).

Transnet presentation
Ms Sizakele Mzimela, Chief Executive Officer: Transnet Freight Rail, said that Transnet Engineering Bloemfontein Centre has experienced declining revenues and demand over the past few years. Given this, it has become necessary to adjust the business to align the operating model to customers’ needs.

To preserve jobs and boost economic growth in the Mangaung District, Transnet requested an engagement session with the City of Mangaung Metro and other key relevant economic development partners. The session will focus on understand their local economic development plans and share mutually beneficial economic opportunities Transnet has identified for the Bloemfontein Centre. During this discussion, Transnet will share the revised business model for the Transnet Engineering Bloemfontein Centre. The session, according to the Metro, was delayed by municipal elections; however, it is expected to take place before the end of 2021.

Transnet Engineering is in the process of evaluating the future of the plant in Bloemfontein and is busy with the consultation process with Labour to look at the options available.

The Chairperson noted time constraints and asked that the written responses to the questions be provided within six days.

Mr Dangor said that there are two departments from which the rails are being stolen and the other one from which export licenses are issued. The stealing of the rails is treason, and the export thereof could be treason. He urged DTIC not to issue export licences for steel and cooper from scrap unless they can prove that it comes from a particular mine. He asked if they have people equipped outside to promote exports.

The Chairperson noted that the MEC raised a point that not only affects the Free State but other provinces that some provinces and metros have resources such as rail that makes it easier for them to function. He asked the DTIC if there are incentives given to the Free State which can enable them to attract investors.

The Chairperson asked if Transnet will be able to invest in the industrial areas where the province and FDC are focusing economic development to transport whatever is produced from those industrial parks.

Ms M Moshodi (ANC) asked when the position of Mr Jacob Maphutha (BEE Deputy Director at DTIC) will be filled.

The MEC in his concluding remarks noted that Free State is serious about reconfiguring and rebuilding the economy. They would want to work with SOEs and other spheres to ensure that this is achieved.

The Chairperson thanked everyone and the meeting was adjourned.

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