2021 MTBPS & Adjustments Appropriation Bill: public hearings

Standing Committee on Appropriations

03 December 2021
Chairperson: Mr S Buthelezi (ANC)
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Meeting Summary


2021 Medium Term Budget Policy Statement (MTBPS)

The Standing Committee on Appropriations met on a virtual meeting platform with the Congress of South African Trade Unions (COSATU) and Amandla.mobi for a public hearing on the 2021 Medium Term Budget Policy Statement (MTPBS) and the Adjustments Appropriation Bill.

COSATU expressed its concerns about the dire state of the economy and its effect on the working class. It pointed out that the COVID-19 pandemic and the violence of July 2021 had left many individuals unemployed. Unemployment had jumped from 44% to 46%. In addition, approximately 27 million South Africans were dependent on state social grants. Although it applauded government for providing social relief grants, it recommended that these grants be extended to the next year. It recommended a number of strategies with which the government could address its problems. These included clamping down corruption to avoid financial losses, the freezing of posts, redeploying staff to departments in need of skills, reducing head counts and investing in maintenance. COSATU was also not happy with budget cuts in certain areas, like university infrastructure and basic education. The MTBPS was silent on a mass stimulus plan, and this needed to be addressed.

Amandla.mobi showed videos of old women who were burdened with the cost of supporting their grandchildren and struggling to survive. They pleaded with Parliament to increase the old age grant to R2 500. The cost of living had escalated and the current grants they were receiving were not enough to cover their responsibilities. Due to high rates of unemployment, they were taking care of their grandchildren because their children, parents of their grandchildren, could not find employment. They lamented that on several occasions they had approached Parliament to address their needs, but their voices had not been heard. Amandla.mobi was therefore a necessary bridge that connected them with Parliament. One of the recommendations the organisation provided was to tax the wealthy. It also suggested that the government should clamp down on losses incurred from illicit financial flows by hiring experts, or collaborating with other governments.

The Committee sympathised with the experiences of the old ladies shared by Amandla.mobi. However, a recurring question was where government was going to acquire money to fulfil the needs tabled by the two organisations. Further, many of the Members were concerned about the information Amandla.mobi shared with the public regarding the state’s efforts to deal with poverty. The Chairperson asked the organisation to at least acknowledge the support government had managed to provide to the public, despite its meagre resources. The organisations were praised for the consistent and valuable insights COSATU and Amandla.mobi had provided to the Committee

Meeting report

Opening remarks

The Chairperson said the meeting would deal with public hearings on the2021 Medium Term Budget Policy Statement (MTBPS) and the Adjustment Appropriation Bill of 2021.

He acknowledged apologies from Mr A Shaik Emam (NFP) and Ms N Hlonyana (EFF) and asked the Congress of South African Trade Unions (COSATU) to proceed with its presentation.
COSATU: 2021 MTBPS and Adjustments Appropriation Bill

Mr Matthew Parks, Deputy Parliamentary Coordinator, COSATU, said the economy was in its deepest recession in 100 years, and that it needed every stimulus it could get. Unemployment had risen from 44% to 46%, and it was expected to continue rising. About 27 million citizens in the country were dependant on the state for social grants. This was worsened by the fact that thousands of companies were closed. The country’s fiscus was bleeding due to corruption in expenditure, through tax evasion, mismanagement of state-owned enterprises (SOEs) and municipalities. Many of the SOEs were in serious crisis, and the economy was badly affected by unreliable energy supply.

The medium-term budget policy statement (MTBPS) was silent on a mass stimulus plan. It focused on budget cuts through a wage bill freeze. There was a danger of austerity, instead of “plugging the holes in the state” and stimulating the economy. COSATU hoped to see a more stimulating budget in February 2022, to kick start the economy. This, however, had to include funds from the development finance institutions (DFIs) and the private sector.

Mr Parks said COSATU appreciated the R11 billion allocated to the Presidential Employment Stimulus Programme. It had created over 550 000 jobs. It proposed that this programme be expanded further over the medium-term expenditure framework (MTEF). It proposed that the government support workers in key sectors that had been affected badly by the pandemic, the lockdown, the July violence and the recession. These included the hospitality and retail sectors. The National Treasury’s (NT's) commitment to develop new measures to support struggling businesses was welcomed, but they needed to be expedited. The relief funds provided by the government to victims of the July violence in KwaZulu-Natal and Gauteng were deeply appreciated.

However, the delays by the Unemployment Insurance Fund (UIF) to pay workers in these two provinces was a matter of national shame. COSATU called for improvements on this front and asked that a package be provided to affected businesses and sectors of the economy from both the government and banks. It also requested the government release the NT’s pension fund emergency relief and regime policy papers by mid-November 2021.

COSATU acknowledged the R350 special relief of distress (SRD) grant provided by the government. However, it asked that this grant be extended to the 2022 budget, because the nine million unemployed people receiving it did not have guarantees that they would find employment. It also requested the government to develop a road map to raise the food poverty line. It proposed that the SRD payments be moved from physical to electronic payments.

COSATU described the R500 billion and R100 billion allocated for infrastructure as critical injections to the economy, and called for the acceleration of this programme.

It expressed its concern over the silence of the MTBPS on measures to stem corruption and wasteful expenditure. It therefore proposed that the government ban Ministers from abusing their positions of power by doing business with state entities. It called for an increase of appropriations for tackling corruption cases for the National Prosecuting Authority (NPA), the South African Police Service (SAPS) and the courts. It also proposed that the South African Revenue Service (SARS) be empowered to instigate lifestyle audits of members of the executive leadership of the ruling political parties, and the blacklisting of delinquent companies from public tenders.

COSATU proposed that a single online, transparent, public procurement system be established for the entire country to help reduce space for looting and to save costs. It called for the centralisation of procurement of large scale items like medicines, text books and vehicles. It requested the government to table the Public Procurement Bill at the National Economic and Labour Council (Nedlac) by the end of 2021, and to Parliament by April 2022.

It applauded the SARS for rebuilding its capacity after the era of state capture. It recommended that the 2022 budget allocate more resources to it to ensure that SARS had sufficient personnel, skills and tools to deal with large amounts of money that was lost to tax and customs fraud. It proposed that the 2022/23 budget had to include some tax increases for those earning over R1.5 million through income, inheritance and estate taxes. Duties on luxury imports should also to be increased. On state-owned enterprises (SOEs), it proposed an acceleration of measures to stabilise Eskom. It called for a clear stabilisation for SOEs in distress, including jobs plans for workers who were at risk.

COSATU appreciated the R19 billion adjustment allocations to departments for the 2021 wage agreement. However, it pointed out that the adjustments to the wage bill in the 2021/22 MTBPS and the Adjustments Appropriation Bill were below inflation. It said that the NT’s austerity driven approaches were not going to rebuild the state. In all key indicators to fix the state, the MTBPS had very few details.

Mr Parks said the wage bill had been stable at 35% of the budget for more than a decade. What had changed was that politicians, their friends and families had looted municipalities and SOEs to the brink of collapse. It proposed that the government respect collective bargaining in the public service, entities, SOEs and local government, and to engage bargaining councils on matters of collective bargaining like the wage bill and signed wage agreements. It recommended that the government work with organised labour to establish a single collective bargaining and wage regime for the entire state, including SOEs.

COSATU also requested the government to formulate a clear and realistic plan for all schools to have access to decent water and sanitation by the end of 2022. In addition, it recommended the reversal of the MTEF cuts to the Department of Health (DoH), particularly the funding to the National Health Insurance (NHI) scheme.

COSATU proposed the Government Communications and Information Service (GCIS) and the DoH should be sufficiently resourced to run a mass media and education campaign on the need to vaccinate. It recommended that the R150 million allocated to Digital Vibes by the DoH be seized and allocated to the GCIS.

It welcomed the R245 million allocation for employment opportunities by the Presidential Employment Programme. However, it was still concerned at the reduction in funding to the Commission for Conciliation, Mediation and Arbitration (CCMA). It supported Nedlac’s stance to divert R10 million to the CCMA to assist it with workers who had lost jobs or who were in need of other help. In light of this, it recommended the reversal of cuts and the reprioritisation of funds to the CCMA. It was anticipated that this would increase its efficiency in delivering essential protection to workers. COSATU also recommended the reversal of cuts to key social security departments that would impact upon their ability to deliver social relief, like the COVID-19 SRD grant to the South African Social Security Agency (SASSA).

COSATU was concerned about cuts in export market and investment assistance, manufacturing development incentives, and special economic zones (SEZs) by the Department of Trade, Industry and Competition (DTIC). It recommended the reversal of cuts to key programmes that could impact on their ability to industrial, manufacturing and export programmes. Concerns were also raised on the R52 million cut for financial accounting and supply chain management (SCM) systems . It pointed out that SCM and accounting systems were porous, and often lost large sums of money annually to corruption and wasteful expenditure. It recommended the enhancement and extension of programmes like the Neighbourhood Development Partnership Grant to ensure sustainability.

COSATU recommended that the Department of Transport (DoT) and the Passenger Rail Agency of South Africa (PRASA) should table a plan to rebuild PRASA to Parliament, and be held accountable for its implementation. It also recommended that the Department of Water and Sanitation (DWS) and the eMfuleni municipality needed to table a plan to address the Vaal River crisis to Parliament. There were also concerns about the R1.3 billion cuts in university infrastructure projects, given the backlog in student accommodation and the need to expand the size of classrooms to adjust for social distancing.

COSATU welcomed the R429 million allocation to the National Youth Development Agency (NYDA) for employment. It recommended that the NYDA should table a plan for this funding. Budget allocations for employment in the Departments of Environmental Affairs and Forestry; Agriculture, Land Reform and Rural Development; and Tourism were acknowledged and appreciated.

COSATU recommended a clear stabilisation, recovery and repositioning of plans for municipalities, and a road map to move towards the district development model (DDM). It also hoped that the government would table a budget that stimulated the economy, ensured job creation and provided relief to the unemployed. It recommended the prioritisation of plans to tackle corruption and wasteful expenditure.

Amandla.mobi: 2021 MTBPS and Adjustments Appropriation Bill.

Ms Tlou Seopa, journalist and social activist, Amandla.mobi, said Amandla.mobi had messages from members of the community that it wanted to share with Parliament ahead of the MTBPS. These were mostly from old women who were taking care of their grandchildren.

The first speaker, Ms Thoko Ngubane, from Pietermaritzburg, KwaZulu-Natal (KZN), said she shared the many problems that other old women were facing in the area. She pleaded with Parliament to increase the pension fund, especially for old women in the villages taking care of their grandchildren. On several occasions she had come to Parliament with other old women to express their struggles in the community. Upon arrival, Members of Parliament seemed to sympathise with them and promised to take action. However, when they returned to their homes, nothing was done. She lamented that they would return to Parliament, and be invited to come and share their struggles, but no action would be taken.

One case that disappointed her immensely was when the former Minister of Finance, Mr Tito Mboweni, invited them to the Union Building. After travelling to meet him, he did not avail himself but instead sent someone to address them. Hopes of meeting the Minister were shattered after the outbreak of the COVID-19 pandemic. The effects of the pandemic also worsened the challenges that old women in the villages were facing. Since Mr Mboweni had stepped down from this position, she hoped that the new Minister of Finance, Mr Enoch Godongwana, would respond to their cries. She pleaded with Parliament to allocate at least R2 500 to old ladies burdened by grandchildren.

The second speaker, Ms Tholani Ngubane, also from Pietermaritzburg, reinforced the previous speaker’s plea. She said they were invited to Parliament with other old ladies but to no avail. She thanked Ms D Peters (ANC) for granting old ladies the opportunity to speak out about their daily struggles. Like the previous speaker, she asked the government to allocate old women R2 500. Many of the women in her position were taking care of their grandchildren because their children, parents to their grandchildren, were unemployed. These grandchildren needed to go to school and this was worsened by the cost of living. She said Mr Tito Mboweni had failed to take them seriously because he had granted them only R30; an amount that was not enough to purchase basic household commodities. However, she had voted for the government because she believed that the government cared for her.

The next speaker asked the government to increase the old age grant to R2 500, because the cost of living had increased. He said many of these old ladies were supporting more than eight children per family. Some were even above 18 years of age, and did not qualify for child support.

Apart from the old ladies, the presentation shared the voices of single parents who also pleaded with -government to increase the R350 grant to at least R700. They said they were suffering, and that the current grant was not enough. One of the single mothers said she resided with her brother who was disabled. This prohibited her from finding employment, because her brother could not fend for himself. Even the money that he was receiving was not enough. Another single mother of three children said her application for the SRD grant had been denied because of the little money that she had deposited in to her account. She had acquired this money from braiding women’s hair, but it was not enough to support her and her children.

Ms Seopa said the presentation showed some of Amandla.mobi’s demands. These included to retain the R350 grant until it was turned into basic income support. She asked the government to increase the child support grant, invest in social spending, the CCMA, the NPA, to tax the rich and to increase the sugary drinks tax, as well as the carbon taxes and alcohol taxes.

The Chairperson thanked the delegates for their presentations, and opened the platform to discussion.


Mr Z Mlenzana (ANC) expressed deep appreciation for the insights of COSATU and Amandla.mobi that had been provided to the Committee. He said COSATU often decried government’s budget cuts. Did it perhaps consider the reasons behind those cuts? Did government cut on working programmes that possibly had a realisable impact, or was it cutting on unspent money? He asked if COSATU preferred the Committee to request the National Treasury (NT) to inject human resources to assist the affected departments and municipalities, instead of pulling back unused money. He sympathised with the old women whose stories were shared by Amandla.mobi. As an individual also living in the rural areas, he could relate to their struggles. He explained that the children referred to by these old ladies where their grandchildren, and not their own. This was part of the African culture and it was impossible to break it. However, he asked if they participated in the country’s census programme, as such information would help government to understand how the rural set-up differed from the urban set-up.

Ms D Peters (ANC) reiterated Mr Mlenzana’s praise for the consistent and valuable insights COSATU and Amandla.mobi had provided to the Committee. The issues raised by the two presenters, particularly the supporting visuals provided by Amandla.mobi, were convincing. However, where did the two organisations suggest that government acquire the money? This was especially relevant, bearing in mind that the economy was facing challenges, as evidenced by the rising levels of unemployment and the fact that SARS was scraping from the bottom of the barrel. In fact, SARS deserved to be applauded for successfully extending the SRD grant.

Like Mr Mlenzana, she related to the experiences of the old women in the videos, as she too was raised by her grandmother. Even though in some instances the parents of these children were getting the child support grant, they hardly used it for its intended purpose. In light of this, these old ladies (or the many burdened grandmothers across the country) were “overtaxed” in the country. This was because the grant from the government was supposed to carry them through their sunset years, enable them to buy comfort and luxurious commodities like sweets and perfumes, and to simply relax at the beach. Unfortunately this was not the case because the cost of living was too high. When one walked into a shop, there was no price for senior citizens, and one for the younger generation. Given these circumstances, these old ladies were faced with high costs of food. She also emphasised that “grandchildren could eat you out of your house, let alone if there was no food.”

However, as she mentioned earlier, the funds needed to fulfil the campaigns of both COSATU and Amandla.mobi were not available. Despite the consistency of these organisations in their reports and their convincing evidence, the Committee still did not have an answer about where the government was going to acquire money to support the proposed programmes. She asked Amandla.mobi to relay the message to the old ladies about government’s work towards creating a basic income grant (BIG). In response to one of the old ladies, who had said one of her grandchildren was above 18 years old, she said this individual was now a young adult who qualified for the SRD grant if they were unemployed or not, under the National Student Financial Aid Scheme (NSFAS).

She asked Amandla.mobi if it had done any research on the abuse of the grants by recipients. She pointed out that in the past, social workers -- with the power granted to them by an attorney -- could administer grants on behalf of grantees. However, the Head of Department (HoD) of the Department of Social Development (DSD) in the Northern Cape (NC) had recently informed her that this system was no longer in place. She could not understand why this system had been removed, because it helped to monitor parents who did not use the social grants for their intended purposes. She quoted the late Minister of Social Development, Mr Zola Skweyiya, who had explicitly stated that the grant was not for the parents, but for the child. She suggested to Amandla.mobi to consider if this was not another option.

Mr A Sarupen (DA) said COSATU had stated that it wished to establish a single collective bargaining and wage regime for the entire state, including SOEs. What was the rationale behind this, especially considering that there were different kinds of workers and levels of workers who all had different interests? The management had different interests to the personnel working below them. For instance, nurses had different interests to pharmacists. He said this suggestion seemed like a ploy by the organisation to call a single national strike involving every kind of worker when its demands were not met. This was simply because the proposed system lacked a clear upside. He also asked what COSATU had done to argue for the rationalisation of the tripling of staff at Eskom amidst its plummeting energy output. This question extended to what COSATU had done in similar situations at other SOEs.

Mr Sarupen, while welcoming Amandla.mobi’s presentation, replied that it was not as simple as telling the public that a certain six Members of the Committee had the power to extend the grant. It was not up to those six Members, and there were more than six Members in the Committee. He also pointed out that this was inaccurate, because tabling amendments to the budget was extremely complicated, as evidenced by the Committee’s past experiences. For example, it involved engaging in an agreement with the Social Development Committee, and conducting a fiscal analysis on any intended changes. The amendments that he had tabled in the past were often voted down. Given these procedures, it was misleading for Amandla.mobi to state that a certain six members of the Committee had the power to make amendments. He urged Amandla.mobi to examine these procedures, and to share accurate information with the public. This would place them in an informed position to best lobby Parliament to get changes to the budgets.

Mr X Qayiso (ANC) said COSATU was accurate in the issues it had raised, and that these matters would be incorporated in the Committee’s report. The over 40% unemployment rate was worrisome, and he called for the fast tracking of the basic income grant. He also pointed out that the project to address poverty encompassed a lot of things, and not merely providing the R350 social grants. The matters raised by the old ladies in the supporting video constituted just a part of these many areas that needed to be addressed. He agreed with what they were saying, and sympathised with their struggles. However, the Committee had to consider that the parents of the children being taken care of by these old ladies were part of the 40% of unemployed citizens. Therefore, leaving their children under the care of their parents was not necessarily an act of abandoning their children, but a strategy to cope with their own unemployment challenges. Considering this context, he suggested that there had to be an alternative way to mitigate these challenges, beyond the R350 social grants.

Mr Qayiso said the CCMA was very helpful in assisting government when it was overwhelmed. Therefore, in light of the cases raised by COSATU, the CCMA had to be in a position where it was the first port of call to avoid strains on workers. For instance, in a case where a worker was dismissed and requested to submit papers, those papers would take at least three months to be attended to, and this would cause a strain on this family or dependants. Circumstances like these showed that there was a need for reprioritisation. There was also a need to devise a way in which the government could assist the CCMA in dealing with such matters.

He agreed with COSATU’s observations on industrial finance and the Industrial Development Corporation (IDC). Although there was no budget, reprioritisation had to be looked at in the context of economic recovery. This was because the emphasis was on building the country’s industries with particular focus on special economic zones. Therefore, in the economic recovery plan, those were the areas that needed to come first.

He agreed with COSATU’s intention to create a single collective bargaining unit for the entire state. The existing system, where there were different bargaining councils representing different workers or workers at different levels, caused a lot of disjuncture. A single bargaining council was therefore necessary to create a central point were matters could be resolved without any disparities. It would be a major setback if collective bargaining councils in the public service were to be liquidated in the country. It would also give the private sector an opportunity to do away with bargaining councils which, in effect, would have detrimental consequences for workers’ rights. This, ultimately, would affect their living wages.

Ms M Dikgale (ANC) said that due to challenges with network connectivity, she had missed COSATU’s presentation, so she was going to respond only to Amandla.mobi’s presentation. She expressed her appreciation for its work, but requested that in its interaction with the public, the government’s efforts to solve the ongoing challenges be acknowledged. For example, when the R350 social grant was promulgated, it was not promised that it would be provided every month. However, government had made this possible and extended its duration. This proved that government was trying its level best. She asked Amandla.mobi to act like pastors, whose role was to encourage people experiencing difficulties that God was in control, and that everything was going to be okay.  Their support, even in prayer, would help, as government tried to find solutions for the country’s problems.  

She said the Committee appreciated the country’s senior citizens because they always practiced their democratic rights through voting, regardless of the parties they were affiliated to. These were very important people whose problems had to be attended to with great urgency. She also agreed with the suggestion in the presentation that the tax on wealthy citizens, particularly the miners, had to be increased. This could significantly help the government in its goal to reduce poverty.

Ms Peters asked COSATU to comment on the challenges of service delivery, over expenditure and irregular expenditure by the public service workforce. She pointed out that it was time to engage the workers on issues concerning productivity and the impact of their work on society, and not just the wage bill. She referred to COSATU’s statement in its last slide that the voters were now impatient. Indeed, the ANC was the administration, and indeed the politicians were the public’s representatives, but the eyes and ears of government were the workers. Workers were the agents for change in the country. She also asked if COSATU had ever engaged the National School of Government concerning where there were challenges and gaps. Building the state’s capacity was important to deliver services to the citizens and this, in her opinion, could be achieved only through the workers.

The Chairperson thanked the Members for their feedback and said the matters discussed were very important. Some of them needed the attention of the whole country to reach a consensus on where government was leading the country. He asked for clarity on what COSATU meant by a budget that stimulated growth. He also pointed out that COSATU was silent on the question of unspent funds and roll-overs. This was an important issue that was closely related to Ms Peters’ comments on the role of the workers. When a budget was provided and funds disbursed, the employees were expected to channel it to its intended use -- service provision to the people.

He thought the Amandla.mobi presentation was going to start by acknowledging the extension of the R350 SRD grant, because this was evidence that government was responsive to the issues raised by the public. He asked if Amandla.mobi educated the public about how the budget worked. Government’s limited resources and the impact of the COVID-19 pandemic on its coffers were important when discussing the country’s budget. Like the previous Members, he asked Amandla.mobi to educate the public about this dynamic in its interaction with the public. Currently 50% of government’s budget was channelled towards social wages. This included education, social grants and other employment interventions. In addition to this, the pandemic had worsened the situation, because government was using some of the funds to provide vaccinations. Ideally government would have wanted to provide more grants, but this was difficult in light of the amount of money it was already dedicating to social wages. He emphasised that social wages were very important, because government wanted to provide free education and health services to the public.

The Chairperson said government was trying its level best to meet the needs of the people. In his younger years during apartheid, social grants were allocated along racial lines. Africans received grants after only two months. The same could be said about the Reconstruction and Development Programme (RDP). Although government had not met its target, it had managed to provide shelter for many people who previously had not had housing. These examples were evidence that government was trying to meet the demands of the people, regardless of its limited resources.

Once again, he pleaded with Amandla.mobi to explain these details to the public -- that in instances where government’s funds were not enough, it sought credit from organisations like the International Monetary Fund (IMF). However, upon acquiring these funds, it accumulated debt through interest. At the moment, 20% of government’s budget was being used to settle these debts. Failure to pay these debts could result in the IMF shutting down some of government’s social programmes -- for example, all the programmes under its budget on social wages. Like anyone who owed the bank, failure to service a debt resulted in the bank coming to claim their property. However, the South African government did not wish to find itself in this kind of situation with its debtors. This was a factor that government was trying to balance, as it was dealing with the issues of social grants.

COSATU's response

Mr Parks agreed that any civil person would appreciate the fiscal challenges that the state was facing. He also expressed appreciation for the Presidential loan programme, which he described as a good gesture that had the potential to create employment and recover the economy. Regarding the budget cuts, he had no simple answers. However, as a former government official, he knew that every department had money it could squeeze out, without affecting its capacity. The focus was on those departments where COSATU felt cuts could have an impact on government’s ability to provide services, but not all of them. This was the reason why the organisation was concerned with the Department of Trade and Industry, because it was one of the excellent departments. Its support for manufacturing industries created jobs, which in effect reduced the number of people dependent on the state.

He suggested there was need for consequence management being applied to the Ministers and Directors -General who were responsible for unspent money. There was a need for cost intervention around PRASA and the Department of Basic Education, because these were the weak spots. There was also a need for COSATU and Nedlac to lead by example by diverting some of their funds to support the CCMA. COSATU was also in communication with its close associates who sat on Sector Education and Training Authority (SETA) boards, to find out if they could also assist the CCMA. He pointed out that there was a problem with fiscal dumping and wasteful expenditure. In the previous year, about R13 billion had been allocated to build head offices in six departments. This did not make sense, given the crises that the country was facing.

Mr Parks said Ms Peters’ question about where the money was supposed to come from, was a very valid one. The country could not continue accumulating debt. South Africa had to avoid what had happened to Greece and Ireland. It had to also avoid the IMF’s brutal solutions. In that regard, South Africa had to find its own solutions. There was no easy solution. However, there were areas that the country could do well.

He expressed his appreciation for the work done by Mr Edward Kieswetter, the new SARS Commissioner. There was need for the budget to provide more support to the SARS. In 2021, it had appointed an additional 500 specialists whose expertise were starting to show. He suggested that there was space for the NT to look at some tax loopholes. One major gap was in customs enforcement, were the most of the customs duty was not collected. If SARS was provided sufficient support to increase its staff, it would improve the collection of customs from about 5% of goods to 100%. Not only would this provide money to the state, but would protect local jobs and industries, and the DTIC's investment in industry. Government could look into blockages like mining licences as possible interventions. There was a backlog of approximately 10 000 mining licences in the Department of Mineral Resources and Energy (DMRE).

Saving companies was another key imperative. This was because active companies meant a steady flow of tax revenue. COSATU supported the NT’s proposed amendment of Regulation 28, to allow pension funds the right to invest in infrastructure. This was a welcome compromise and an opportunity to help inject money into infrastructure.

He said that to stimulate the economy, everyone had to be vaccinated. That way, people would return to work, thereby necessitating the growth of the economy and the collection of revenue.

Mr Parks said the creation of a single collective bargaining unit for the state would benefit the workers. It was more effective to work with a single unit, rather than 100. In addition to this, a single collective bargaining body benefited government by reducing the costs incurred in dealing with multiple bodies. Instead of many, one pension plan was sufficient, and saved government a lot of money. He said the South African Broadcasting Corporation (SABC) had managers who earned more than the President. At Eskom, the management head count had jumped from 80 to 800, and they were earning above R2 million. In light of this, the NT supported the move to a single collective body.

He clarified that there had been no tripling of staff at Eskom. It had increased from 32 000 to 47 000, and decreased again to 44 000. COSATU had drafted a contract that was signed by the government and businesses in December 2020. The contract stipulated that COSATU was willing to assist the state to reduce the debt burden of Eskom. It had made recommendations to consider freezing posts, the redeployment of staff to other departments in need of skills, a reduction in head counts and investing in maintenance.

Mr Parks said the country could not afford to have eight million unemployed people. The real solution was to create jobs. It was not ideal for half the country to be dependent on state grants. However, the violence in July 2020, apart from the criminal aspects, showed that people were in poverty, hopeless and in despair. It was therefore necessary to extend the SRD while government was working towards employment creation. He applauded the government for channelling 60% of its budget to social wages. This was a remarkable achievement.

However, government lacked a sense of urgency in fixing ticking time bombs like corruption in the economy, Transnet, PRASA and Eskom. The country was running out of time, and problems needed to be resolved on time to prove to the people that the government was cleaning up. The state was collapsing, and COSATU had been mobilising its members to blow the whistle on corruption. The fact that 5 000 people at Eskom were implicated in forensic audits was alarming. He agreed that employees had to execute their tasks efficiently. They needed to be held accountable for not doing so. Another way COSATU was trying to assist workers was to actively support the "buy local" campaign.

It had engaged the School of Government, but more had to be done.

COSATU welcomed the R500 billion stimulus package, and believed that there was room to create new ones. The Banking Association was working on a new type of loan support for companies. It was hoped that this scheme would be ready soon. It was uncertain whether more money was going to be available from the UIF, but COSATU was committed to continue engaging it. The extension of the SRD was another stimulus package. Government could reinforce the DTIC’s financing programmes to support companies. COSATU supported government’s infrastructure programme, and the investment of pension funds in this programme.

He agreed on the matter of rollovers in basic education, transport and local government. However, the Ministers, the Directors-General and Mayors had to be held accountable for that. It was unfair to other departments to be denied mismanagement in other departments.

Amandla.mobi's response

Ms Seopa said that all the old ladies in the presentation were from the Pietermaritzburg forum. There were many other organisations formed by similar old women to mobilise and fight for their needs. Some of them had access to these kinds of spaces but some, often due to health reasons, did not. As a result, the few who had shared their stories spoke on behalf of every pensioner in the country. To ask the old ladies where the money should come from, was a very unfair question. This was because they had no role in the misuse of state funds. In fact, it was best to inform them about where the money went. Reports on the embezzlement of state financial resources by individuals in positions of power were awash in newspapers and other media platforms. Citizens were aware of ongoing corruption. The proposed solution was to tax the rich. She added that if this solution had been adopted years ago, the country would not be in this situation. Although there may have been people who abused the grants, people within the Amandla.mobi community genuinely needed support. They lived in serious poverty.

Ms Seopa clarified that Amandla.mobi did not carry the mindset that people in the Committee were the decision makers, nor did it tell the public that a certain six Members of the Committee were going to change things. They simply made people aware that people in spaces like these could help influence decisions that made people’s lives better. For instance, Amandla.mobi had engaged the Finance Committee, the Appropriations Committee, the Department of Social Development and the Presidency. Since the public’s pleas were often not heard, Amandla.mobi explored other ways of applying pressure. She agreed that the good deeds of the government had to be acknowledged and that Amandla.mobi appreciated the increase of the grants. However, if things did not get better, the organisation was not going to stop applying pressure - it was its duty. Parliamentarians were responsible for passing anti-poor budgets, for failing to raise revenue from those who could pay more tax, and for failing to address poverty. For these reasons, Committee Members had to face the public and explain why they passed anti-poor policies.

The Chairperson thanked the two speakers for their responses and directed additional questions to them. He asked Mr Parks to share COSATU’s stance on transfer pricing, commenting that this system was robbing many South Africans of valuable taxes. He asked Ms Seopa if the old ladies in her presentation were aware of government’s indigent programmes that provided free services to the elderly and poor.

Further responses


Mr Parks said one of the unexpected positive outcomes of the pandemic was that it had democratised Parliament. It had become open and accessible to everyone. One could be in Thohoyandou, but still actively participate in Parliament without incurring expensive flight costs to Cape Town. He said that despite people’s political affiliations, it was important to come up with collective and pragmatic solutions.

He agreed that COSATU had not paid enough attention to transfer pricing. The problem of offshore illicit outflows was a recurring one, and demanded attention. He promised do give a detailed outlook on this matter in a forthcoming meeting. However, the country had failed to address the challenge of beneficiation. The dependence of countries abroad to process the country’s mineral resources was another way revenue was lost. He also recommended transparency, not only in SOEs, but in private enterprises as well.


Ms Seopa responded that some of the old ladies were aware of the indigent programmes, but some were not. This was a matter of limited access to information. She suggested that the government consider experts on illicit financial flows, adding that governments around the world were now open to collaboration in the fight against illicit financial flows.

The Chairperson thanked the two speakers for their valuable contributions. He said Parliament did not wish to be seen as serving only the wealthy. It appreciated hearing the old ladies narrating their stories. He expressed his appreciation to Amandla.mobi for facilitating Parliament’s interaction with the old ladies.


The Committee's minutes of 23 November 2021 were adopted.

The meeting was adjourned.

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