Appropriation Bill: public hearings

Standing Committee on Appropriations

31 May 2022
Chairperson: Ms D Mahlangu (ANC, Mpumalanga); Mr S Buthelezi (ANC)
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Meeting Summary


In a joint meeting, the Standing and Select Committees on Appropriations held public hearings on the Appropriation Bill. The Committees heard submissions from Equal Education, SAICA and COSATU. The main points in the submissions included the shrinking spend on school infrastructure; the inexplicable R3.4 billion budget for VIP protection compared to only R4.9 billion for the National Prosecuting Authority (NPA); underspending and irregular spending; modernising the National Student Financial Aid Scheme (NSFAS) administration; reduction in provincial allocations in the Medium-Term Expenditure Framework (MTEF); and parliamentary oversight for accountable government budgets and spending.

Committee members engaged on the provision of scholar transportation, schools and ineffective spending in the education sector when looking at the education budget as a percentage of GDP. Concerns were raised over the school infrastructure backlog and the inability of the infrastructure to keep up with the rate of urbanization. There was some back and forth on parliamentary oversight and ultimately consensus was reached over the need for efficient and effective budget oversight. The Appropriations Committees agreed that they should not be used to merely rubberstamp the budget but that it must be critical and identify specific areas for amendment. Questions were raised about the efficacy of zero-based budgeting, Eskom, fuel price, Road Accident Fund and the role of union members in reporting corruption.

Meeting report

Both Chairpersons thanked Equal Education, COSATU and SAICA for attending and giving input on the Appropriation Bill.

Equal Education submission
Ms Jane Borman, Equal Education Researcher, spoke to South Africa’s current context that needs to consider the impact of COVID-19 and the unique challenges that it added to the education sector. She looked at Basic Education trends as reflected in the consolidated budget and the shrinking infrastructure spend. Since 2012/13 R2.7 billion has been irregularly spent through the Accelerated School Infrastructure Delivery Initiative (ASIDI). The submission touched on access to higher education and the role it plays in economic growth while pointing out the shortcomings of the NSFAS. Equal Education called for National Treasury to provide meaningful oversight of the sector and to develop cohesive policies that ensure all learners have access to higher education.

SAICA submission
Dr Sharon Smulders, SAICA Project Director: Tax Advocacy, discussed the budget allocation for VIP protection for a small group of politicians, misuse of the contingency reserve, SARS funding and unbudgeted expenditure. General comments included the pre-spending of next year’s budget, government's 30-day payment rule for SMEs, appropriation versus performance, and oversight and accountability.

COSATU submission
Mr Matthew Parks, COSATU Deputy Parliamentary Coordinator, spoke about the Presidential Employment Stimulus (PES), Social Relief of Distress (SRD) Grant, the relationship with public servants after the abandonment of the 2020 wage agreement, and the R812 billion allocation for infrastructure projects. COSATU expressed concern over the reduction in allocations to provincial governments in the MTEF. Further submissions were made about state-owned enterprises (SOEs) such as Eskom, PRASA, Transnet, DENEL as well as the Road Accident Fund.

Mr E Njadu (ANC, Western Cape) said when looking at scholar transport, there have been many problems and a lack of standardisation. How would Equal Education suggest that this programme be implemented by government? Does Equal Education have a suggested solution for the school infrastructure backlog? What is its view on the current movement in infrastructure funding from national to provinces? Can Equal Education comment on the state of preparedness for the Childhood Development (ECD) move from the Department of Social Development (DSD) to Basic Education?

Mr Njadu said that he disagreed with COSATU's comment about lack of oversight as the parliamentary committees are fulfilling their mandate. He asked COSATU to comment on the Eskom, increased fuel prices and Post Office challenges.

Mr Njadu asked SAICA what key mechanisms Parliament may use to ensure fiscal oversight.

Mr D Ryder (DA, Gauteng) noted the submission sent in by Mr Vusani Kalikopu and suggested that it be sent to the Western Cape provincial legislature where it could be better addressed due to the nature of its contents. On Equal Education's concern about the shrinking infrastructure allocations, the school infrastructure backlog will no longer be reported separately as it will be incorporated into the bigger infrastructure allocation. There is concern that the focus on this matter will disappear, what are Equal Education’s views on this? Only 7% of South Africans have a tertiary education yet when one looks at the budget spread between basic education and tertiary education, there is a much larger allocation to tertiary education. There has also been a massive acceleration in the MTEF of the spending on tertiary education. The same escalation for basic education is not evident. Does Equal Education think this increased spending on tertiary education is the right way to intervene in the education system? Over time, ECD spending will have a much larger return for the South African economy.

Mr Ryder agreed with SAICA that the contingency fund is being misused. It is not a suspense account but a slush fund. This is a big issue that needs to be addressed. The ministers need to attend more the committee meetings to engage on these matters. There are clear disparities between the promises made by politicians and what gets budgeted for. It would be useful to dissect the budget speeches and compare them to what ultimately gets budgeted for.

On COSATU’s comment that there still needs to be a resolution to the 2020 wage dispute, the Constitutional Court decision made it clear what the resolution is. COSATU needs to put that matter to bed and move on. COSATU is calling for a 10% across the board increase on the wage bill yet in previous submissions it expressed the need to reduce the wage bill. This smacks of indecision and it must ‘grow up’.

It was great that 30 new schools were being built but to keep up with rapid urbanization, Gauteng needs about 24 new schools per annum and the Western Cape about 18. The budget is not keeping up with people’s needs; this extends to schools and even police stations.

Mr M Moletsane (EFF, Free State) asked for Equal Education’s stance on the criteria used by government for the quintile ranking of schools to determine funding. Are these criteria satisfactory? Corruption is spreading like cancer in government, does COSATU have advice on how to combat this?

Ms D Peters (ANC) said the Committee was concerned about the lack of public submissions on the Division of Revenue Act (DORA) as the inputs delivered are always valuable. She disagreed that Mr Kalikopu’s submission should be sent to the Western Cape provincial government. Receiving the submission at National Parliament shows that ordinary individuals are able to reach Parliament. She also explained that it is not up to the committee to take the submission to provincial level but for provincial representatives such as Mr Ryder to present the submission at that level.

Ms Peters asked the three presenters if they have engaged the portfolio committees. For example, has SAICA met with the Portfolio Committee on Cooperative Governance and Traditional Affairs (CoGTA) and raised concerns about local government? The same goes for COSATU. On the diminishing number of police officers, the portfolio committees do oversight on these matters. This Committee looks at funding – is it enough or are the reductions justifiable – but the portfolio committees need to ensure that the work is being done.

On matters raised by COSATU, many public servants who are the agents for change are part of unions such as COSATU. Are the union members aware of the issues being raised here and are they also taking action? On the Accelerated Schools Infrastructure Delivery Initiative (ASIDI), scholar transport and budget underspending, would it be better for the schools to own the busses rather than contracting the service out?

Mr W Aucamp (DA, Northern Cape) said the 30% underspending by ASIDI is extremely concerning. He agreed that there must be increased accountability and oversight. He added to the point that Mr Ryder made, in the John Taolo Gaetsewe (JTG) District six schools need to be built each year to keep up with urban development, yet in the past three years only two schools have been built. This problem needs to be tackled otherwise there will be a huge problem for education. There also needs to be improvement on the upkeep of existing schools. Another worrying trend is the decrease in basic education funding from 2018 to 2024. The decrease is not justifiable. The same applies to school infrastructure grants that from went from 14.18 in 2021/22 to 13.87 in 2024/25.

He agreed with SAICA that there should be more interaction and that it is Parliament’s job to hold the executive to account. The Committee cannot simply rubberstamp the Appropriation Bill from Treasury, as this is what is currently happening. It is inexplicable that there is a R3.4 billion budget for the VIP protection unit when only R4.9 billion is going to the NPA. Considering all the prosecutions that must take place coming from the Zondo Commission, it is shocking.

On the 12 000 additional police officers, it is concerning as the 2024/25 Police budget is lower than the 2022/23 budget. The land reform cut of 2.7% over the MTEF indicates that land expropriation without compensation is an unreasonable suggestion. This shows incompetence and that proper land expropriation is not being done. Redistribution needs to be done by means of compensation. The reason it did not work is government’s inability to spend properly. He agreed with the statement that R22 million for a flagpole is ridiculous; similarly it is ridiculous to spend money on changing the name of the ‘Afrikaanse Taalmonument’ in Paarl.

It is worrying that 175 municipalities are in financial distress. These municipalities and also SOEs will remain in distress unless cadre deployment, where people are put in positions they are not qualified to do, is stopped. There is a lack of control and consequence for these people.

On COSATU’s statement on the fuel levy, the levy needs to be scrapped. The DA put forward three ways in which this can be done: 1. cut out wasteful expenditure 2. exemptions can be given to the Road Accident Fund (RAF); SARS can do a rebate for people already paying third party insurance which can alleviate the burden on the RAF which can lead to a decrease in the fuel price. 3. the fuel sector can be deregulated as in any other sector in this country; competition will lead to a decrease in the fuel price.

Mr Aucamp remarked that not enough money is made available to assist upcoming farmers and to assist the farming sector in general.

Mr Y Carrim (ANC, KZN) said the question consistently raised by National Treasury, this Committee and the Portfolio Committee on Basic Education is how can we get more value for money since South Africa is one of the largest spenders on education as a percentage of GDP.

Mr Carrim said a contingency fund is primarily for unforeseen and unexpected circumstances. As a part of a social democratic approach, he disagreed with SAICA on the urgent need to ensure that the state and the market work together. Each time National Treasury dips into the contingency fund to rescue SOEs, the money cannot be given without conditions, and it cannot be given all in one tranche. The money should be used for the KwaZulu-Natal floods and the drought in the Eastern Cape instead of being used to rescue SOEs.

On the money allocated to VIP protection services, he disagreed that the unit does not serve a purpose and that ministers are not vulnerable. However, compared to the NPA, there is a case to be made. The fiscal framework reports from the Portfolio Committees are sent to the Appropriations Committees, it is not true that there is no interaction as the chairs often confer with each other. The staff, in the case of Appropriations Committees, have no choice but to read these reports. However, he did agree that there should be a formal meeting before the Appropriations Committee gets going where the Standing Committee on Finance Report and the Fiscal Framework Reports are discussed. Unfortunately, it is almost impossible to schedule such a meeting considering the workload of each of the committees. In fact, due to the heavy workload, there should be three committees. One should focus solely on oversight, the second one deal with legislation and the fiscal framework and the third should deal with appropriations. There has not been any traction for this suggestion, although it was put into the legacy report of the Standing Committee on Finance at the end of the Fifth Term. A lot of the work, the pushing and the nudging, gets done offline. There are around 24 other committees and committee chairs, this Committee cannot do the work of the other finance committees.

On COSATU, most of the values and principles brought up in the submission are agreed on but the question that needs to be asked is what practically can be done. The Committee would like to see more practical proposals; it is not your job to do it, it is for the Committee to implement but it would be valuable to the Committee to hear suggestions. What are the public sector unions such as COSATU, Nehawu, SATU and SAMU doing about corruption? How often do public sector workers in COSATU alert the municipality, provincial or national government about corruption? There are sections of COSATU workers that are not immune to corruption themselves. He noted that Mr Ryder’s comment was inappropriate.

Mr Ryder called for a point of order and clarified that his comment was on COSATU needing to ‘grow up’ and was not a personal attack on Mr Parks.

Mr X Qayiso (ANC) said that the Appropriation Bill has made a number of very good interventions in critical areas. NSFAS owes the Tshwane University of Technology R430 million while billions have been allocated to NSFAS. This allocation shows the commitment to addressing higher education, but NSFAS cannot be allowed to fail in administering its duties. Treasury needs to come in here and assist to deal with this trend. It is blurring the impact that the budget seeks to achieve in higher education. Treasury needs to intervene so that students from the poor working class are not disadvantaged by the poor administration and functionality of NSFAS.

Secondly, the administration by banks of the R200 billion Covid-19 Guaranteed Loan Scheme for small and medium sized enterprises (SMEs) had created a problem. He recommended that the development finance institutions be given the responsibility of administering the R35 billion in loan and equity support for SMEs as the banks had failed to assist them.

Mr Qayiso asked why there is a reduction in the infrastructure budget when there are discussions around growing infrastructure. COSATU raised the point of job creation as there is a threat of retrenchments at Eskom and Telkom which goes against the agenda of job creation. He agreed that it is something that must be considered. He asked for SAICA’s take on zero based budgeting as opposed to historical budgeting.

Ms N Ntlangwini (EFF) said year after year these meetings are held but the recommendations are not fully implemented. Government is spending more money on VIP protection than on gender-based violence (GBV) cases. She used the example of Kensington police station, where she has done oversight work, which has only four vehicles yet the community is rife with gang violence and drugs. This is not sufficient.

Strong recommendations need to be made about the items National Treasury is budgeting for. This Committee should reject the budget allocations that do not sense and are not helping the country. This Committee should not simply be used to rubberstamp. When doing oversight work at the South African Defence Force (SANDF), it was found that many soldiers do not even have uniforms or ammunition to train with. Cut the state entities and budget items that do not make sense and are just robbing the fiscus. This Committee must be brave in fulfilling its mandate and do more than rubberstamp a budget. This budget, as it stands, is not improving the lives of black people; it needs to be rejected in all its forms.

Chairperson Mahlangu replied to rubberstamping and the suggestion by Ms Ntlangwini to reject the budget. The Committee should identify specific areas that should be rejected rather than rejecting the budget overall as the consequences of an overall rejection are too large. The Committee should suggest amendments and improvements in specific areas in order to be productive.

On SAICA’s point that the Act does not seem to provide the scope for the committees to consult with each other, Chairperson Mahlangu echoed Mr Carrim’s point and said that the Committee has engaged with other committees such as Health, Public Enterprises and CoGTA. The Money Bills Act provides that other committees should consult with the Appropriations Committee on amendments to specific budget allocations. This is thus a part of the mandate and shows that oversight is being done. The question should be if the work being done is effective.

Chairperson Mahlangu said that she was comfortable with the points raised by COSATU but she still believes that Mr Parks needs to get closer to the issues. Once workers on the ground are drawn in and made to understand that their contributions are what will change the institution then the ambition for a clean audit will be achieved. These individuals need to appreciate that what they do has an impact on the whole administration. COSATU and its affiliates should not be seen as unions that are promoting corruption or wrongdoing as these federations have a code of conduct.

She clarified that Mr Ryder represents Gauteng so as to avoid confusion on Mr Kalikopu’s submission that is to be brought to the Western Cape provincial government.

Chairperson Buthelezi said that it is difficult to argue with the presenters on which areas need more funds to be allocated as unfortunately there is a budgetary constraint that needs to be worked with. It is therefore important to prioritize. The question for the budget is therefore if the prioritization is the correct prioritization. One must remember that when the budget is in a deficit, the capacity for borrowing is not open-ended.

He noted that there was very little mention of the Economic Reconstruction and Recovery Plan. Most of the concerns and the ability to acquire more recourses to deal with these issues are contingent on how the economy is growing. The impact of Eskom is widespread and affects sectors such as education. It is therefore important that this is an issue that is dealt with. If Eskom does not perform, most of the plans that are spoken about here will end up being an illusion.

Having spoken about budgetary constraints, it is worrying to still find wasteful expenditure, underspending and qualified or disclaimer audit outcomes in departments. These same departments will ask for more resources but allocating more resources to these departments needs to be avoided.

Similar to Mr Carrim’s question, he asked Equal Education how South Africa compares to other countries when it comes to basic education. Is the problem in our education system or the way that money is being spent? If we were to double the education budget, would the problems be solved? What will happen to the education budget if South Africa were to go to the International Monetary Fund (IMF) and request more funds – which is what will happen if the fiscus collapses? What is SAICA’s take on the decrease in Corporate Income Tax (CIT) to 27%? He expanded on Ms Peter’s point, saying what is the role of COSATU members, especially educators, to ensure that the budget objectives for basic education are attained? What are the presenters’ ideas on the social compact that the President spoke about? The role of labour and business in the social compact is evident. There is the Presidential Employment Stimulus and many other initiatives to stimulate job creation yet when looking at the market there is a great deal of retrenchments. COSATU, what is the role of labour and business in the social compact?

Chairperson Buthelezi thanked the presenters and said that although there may be some disagreements, all parties present ultimately want the same for the country and that is what should be focused on.

Equal Education response
Ms Borman agreed with Mr Carrim that no one is debating the importance of basic education and in theory, all the points raised can be agreed upon – it therefore comes down to budget prioritization. Equal Education looks primarily at basic education and is a part of a collective called the Budget Justice Coalition. A big part of the Budget Justice Coalition's work seeks to answer the question of how does one look at the whole budget, fiscal and economic policies, tax and expenditure to create a budget that is pro-poor, gender-inclusive and realises socio economic rights? There are a lot of points to touch on so if the Committee would be interested in having a more in-depth discussion on this, the Budget Justice Coalition would be happy to engage. The coalition also released a document that details the priorities of a ‘people-centered’ budget, which said would be happy to provide to the Committee.

Equal Education is not asking to take money out of the budget from one department and put it into basic education. It is about looking at how basic education funding is growing in relation to other sectors in government. It is also looking at compensation of government employees and taxation to find a more holistic way to structure the budget that allows for increased social investment.

On the question about standardisation of scholar transport, a lot of provinces have different needs. It would be useful to have a national policy on scholar transport while allowing for provincial education departments to be responsible for the implementation which will allow for more resources to go to rural areas where it is needed. Schools owning and managing their own buses would allow for more agency and adaptability. However, if municipalities, schools and provincial education departments are not capacitated, decentralisation can create greater inequality as some schools will be able to implement policies more effectively than others. So, in theory, it would be beneficial but currently, it does not seem to be the most viable option.

On possible solutions for the school infrastructure backlogs, there is a tension between the need for more resources in basic education and effective expenditure. Schools infrastructure is a difficult area as it involves a lot of procurement which presents obstacles in terms of corruption and tender irregularities.

There needs to be a two-pronged approach, it is not only a question of providing more funding but it is also a question of capacity building and ensuring expenditure accountability. In reply to Chairperson Buthelezi if there would be more change if the education budget was doubled, yes. When looking at Limpopo schools in 2020 that were asked to cut their school budgets by 40%, this had an extreme impact on these schools. There is also the case of the National School Nutrition Programme which is an effective way to provide learners with meals. It is currently serving 9 million children across the country. Although the budget allocation for this programme has kept up with inflation it has not kept up with the increased food prices which will in turn begin to affect the nutritional value of the meals and ultimately have a negative impact on the children. So, yes, it will have a big impact on learner spending and school budgets, but it must be noted that it will not solve all of the problems. There also needs to be an effort to create an environment which is less conducive to corruption – the provincial education departments also need to be incentivized and built. Underspending is not an indication of corruption but an indication that the capacity to spend the funding is not there.

On the ECD move to the Department of Basic Education, Equal Education is encouraged by the prospect of having two more compulsory years of education in the Early Childhood Development phase as the development that happens at this level is vital for educational careers.

The fact that only 7% of South Africans have a tertiary education comes back to the question of prioritising to create long term systemic change. In tertiary education, there are many individuals who get into universities but are unable to pay for the education. Equal Education therefore believes that funding the higher education department is important but it should not come at the expense of basic education.

Tertiary education funding has the short-term impact of creating very important skills and producing graduates that can enter the South African workforce where basic education is the long term approach where one invests in our children and their potential which will over 15 years have a significant impact on society. These two must happen simultaneously. To do this, spending must be done more efficiently without the irregularities that are currently evident. On top of this, there needs to be investment across the spectrum on social spending.

On how South African basic education compares to other countries, South Africa is a part of a number of international evaluation systems. When looking at the amount of money as a percentage of GDP that is allocated to the basic education sector, these evaluation results should be much better as South Africa ranks far too low. The key barriers, she repeated, are school infrastructure and inefficient spending.

SAICA response
Dr Smulders clarified about parliamentary committee oversight that there is a difference between visiting to ensure oversight and taking action to ensure there is oversight. She referred to the Auditor-General report that shows a serious and persistent compliance challenge. The question, therefore, is National Treasury doing all that it can to ensure proper financial management. Looking at who is responsible for the implementation of fiscal sustainability, Parliament has a great deal of power in this. It has the power to ensure that the executive fulfils its role, and it can withhold approval. A key mechanism to ensure financial oversight is for this Committee not to approve budgets where there has not been proper performance.

On Ms Peters' comments about accessibility to the general public, why does Parliament not hold virtual sessions in areas like Khayelitsha or Thembisa? She confirmed that SAICA has reached out to and engaged with multiple levels of government. It is important for SAICA to take part in engagements at the top as change can happen from the top down but SAICA is open to more engagements.

On Mr Carrim’s comments, she clarified that SAICA is calling for a more formal engagement between all the committees as many of these issues require joint action. SAICA has engaged on the subject of oversight in its submission to the Nugent Commission of Inquiry into SARS where the creation of an advisory oversight body was suggested.

SAICA has made several submissions on zero-based budgeting. Although SAICA believes it is a good thing, it is not something that can be done annually. An alternative to zero-based budgeting is the system that is currently in use in New Zealand where all departments get a set base and any further appropriations that may be needed would need to be formally approved.

SAICA also mentioned the implementation of Generally Recognized Accounting Practice (GRAP) which is a change from the Modified Cash Basis accounting that is currently being used. SAICA believes that the current accounting method is creating bad practices that could be addressed should GRAP be used.

On Chairperson Mahlangu’s statement on the Money Bills Act, she asked if these engagements with other committees are effective as the change needed is not being seen. Are budgets being rejected where performance is lacking? If these budgets are not approved, will this not affect service delivery to the taxpayers on the ground? The simple reply is that many taxpayers are not getting the services.

On Chairperson Buthelezi’s points on the Economic Reconstruction and Recovery Plan, there is nothing wrong with the plan, the issue lies with the implementation of the plan. When looking at education spending as a percentage of GDP, South Africa is spending about the same amount as Hungary while the literacy rates of South Africa versus Hungary are not even comparable. This links to the point that South Africa has the money, it is just not being spent effectively.

A great starting point would be the audit outcome as it effectively shows where the problems and wasteful expenditure lie. The CIT rate of 27% is not competitive from a global perspective as it is very high compared to the minimum tax rate of 15%. On the social compact, the role of business and labour is very important; it is critical that government ensures that it let businesses thrive and get them to employ people to deal with the unemployment crisis. The Labour Relations Act needs to be simplified as, at the moment, it is not conducive to hiring people.

COSATU response
Mr Parks replied to Mr Njadu’s questions. On SOEs, Post offices, Eskom and the fuel price, the post office needs a new model but there is still a role for it to play. It can act as a multi-purpose government services access point in rural areas, townships and small towns and it can be repivoted to enter the courier market. He agreed with Mr Qayiso that people cannot be sent into the unemployment queue from the SOEs side. If jobs are at risk, the workers should be reskilled, or new opportunities should be found. He said that COSATU has hope in Eskom as it has managed to draft a Social Compact with colleagues in business and government. There has been a debt reduction of 20% in the past year. There is a need for an additional debt reduction of around R200 billion to get it to an affordable level where the focus can be shifted to maintenance and bringing on board additional generation.

COSATU is engaging with the Presidency about unblocking delays to additional generation coming on board, through the environmental regulatory processes. Eskom should be entering the renewable energy space and it needs to do more to tackle corruption and wasteful expenditure. The NPA and SAPS also need to play a role here.

On the fuel price increase, the Department of Mineral Resources and Energy (DMRE) and Treasury need to extend the April relief on the fuel price and a new affordable tax regime needs to be looked at. MetroRail needs to get up and running again as it will take traffic off the roads. The Road Accident Benefit Scheme (RABS) Bill also needs to be re-tabled. The RAF currently has a liability level of around R400 billion, it is second to Eskom as the biggest threat to the state and it cannot continue like is. It is also about oil refineries; some refineries have been closed. Government should look into buying these so South Africa still has that capacity. There is merit in what the DA is saying about deregulation. It will not solve everything as diesel is deregulated to an extent yet it is more expensive at the moment.

On the resolution of the 2020 wage dispute, public servants were some of those who were hit hardest by COVID-19 and yet they have not been compensated. Of course, they are aggrieved. These members of the public service will move overseas and to the private sector where there is better pay and better opportunities. There is a need to fill critical frontline service vacancies. COSATU has certainly made large contributions especially in the wake of COVID-19 in succeeding in its demand for relief payments to workers where the UIF has released R64 billion credit free to any worker who has lost wages during this period. This is COSATU’s contribution to try and save the economy and companies.

The public servants pension funds have also been heavily investing in the public sector. Is the wage gap between the public and private sector being adequately addressed? Collective bargaining is critical to labour market stability which benefits government and business so that focus can be placed on the economy.

COSATU's advice for combatting corruption is a Public Procurement Bill to enact a single public procurement regime across the state from public service, municipalities, SOEs and entities – it needs to be transparent. SARS needs to be empowered to conduct lifestyle audits of politicians and management. Corruption cases need to be prioritised in the commercial courts. More needs to be allocated to SARS and the NPA. Redeployment within the police service needs to take place. Parliament passed the very progressive Public Audit Amendment Act in 2018 which is not being utilised. The ban on the state doing business with politically exposed persons needs to be tightened. Whistleblowers also need to be better protected. He explained that there are many robust engagements within COSATU on the role of public servants in the fight against corruption. COSATU challenges its affiliates to intervene and address these issues. On roll overs, the North West rolled over about a third of its budget; this needs to be addressed.

Mr Parks agreed with Mr Aucamp on land reform – a multi-pronged approach needs to be taken; more support needs to be given to emerging farmers. COSATU has asked for provincial colleagues to engage on the ‘Taal Monument’. A new business model is needed for SOEs. Many need to be repivoted, refinanced and consolidated and be outfitted with proper and qualified management. In reply to Mr Carrim on practical proposals, the Presidential Employment Stimulus can be doubled which can help around two million people enter the labour market. The R350 SRD Grant should be retained. Local procurement can be ramped up to accelerate the rebuilding of Eskom, Transnet and Passenger Rail Agency of South Africa (PRASA).

Mr Parks clarified that COSATU is half private sector and half public sector and acknowledged the threat of corruption but noted that COSATU and Nehawu have done a lot in exposing corruption and have dismissed members of the movement who have been implicated in corruption.

On NSFAS, there is a need for SARS and the Government Technical Advisory Centre (GTAC) to come aboard and modernise their systems.

COSATU believes that it is necessary for Parliament to be stricter on government. Items such as below inflation increases for social grants should not be tolerated.

On Chairperson Mahlangu’s call for COSATU to get closer to the issue, he acknowledged that there is a gap and that it could be seen in Rustenburg at the May Day celebrations. However, these public servants have a right to be angry and aggrieved and it should serve as a wake-up call. On the social compact, businesses must come to the party as government does not have a blank cheque. Alternatives to retrenchments need to be found. The Department of Trade, Industry and Competition (DTIC) will hopefully bring the Companies Amendment Bill to Parliament soon which speaks to publicly listed companies disclosing the pay gap between directors and workers. What is the private sector doing in exchange for reduced corporate income tax (CIT)?

The Public Investment Corporation (PIC) is a shareholder in most companies on the stock market. COSATU would like to see the PIC be more active as a shareholder when it identifies wrongdoings. To boost labour market stability, investment needs to be made into the Commission for Conciliation, Mediation and Arbitration (CCMA) to modernize it, which will enable it to address workplace grievances before they escalate into disputes and strikes. The labour laws are not the issue, the problem is that the SOEs have been broken and corruption has taken over. These are thus the things that need to be addressed. The consequences of going to the IMF will be devastating. It will mean that the social grants, SOEs and social wages will be done away with and drastically cut which will collapse the economy.

The speakers were thanked for their responses and the meeting was adjourned.


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