MACUA-WAMUA on Mining Communities Social Audit; Mining Charter; Artisanal Mining legalisation

Meeting report

The Chairperson welcomed the members of MACUA-WAMUA and the e Members, the delegation from the Department of Mineral Resources and Energy (DMRE). As he was disconnected from the meeting due to an internet connection problem, Mr Mahlaule took over as chair.

Social Audit Report of 10 communities affected by mines: MACUA & WAMUA briefing
The briefing was done by Mr Christopher Rutledge, Executive Director of MACUA-WAMUA Advice Office (MWAO), Mr Meshack Mbangula, MACUA National Co-ordinator, and Ms Phyllia Ngoatje, MACUA-WAMUA Head of the Paralegal Unit.

MACUA-WAMUA presented its social audit report for 2022 which looked at 10 communities affected by mines (see presentation). Highlights from the report included:
• Mining companies do not complete their Social Labour Plan (SLP) to improve affected communities
• Mining companies do not consult with the affected communities to update them about projects
• There is not enough monitoring to check that mining companies are operating legally and completing SLPs.

Findings from the report:
• Of the ten mining companies, zero completed their SLP commitments within the five-year SLP timeframe.
• None of the mining companies had public participation from the communities to create an SLP.
• Only one out of fifty projects across all the SLPs investigated was for woman empowerment and aimed at improving the lives of women.

Challenges faced by mining communities:
• Unemployment and lack of skills development
• Low access to basic services and infrastructure.
• Environmental issues such as air, land, water pollution affect health of humans and livestock, soil and water quality.
• Health dangers include TB, HIV, skin rashes, asthma, silicosis, and chest and lung problems.
• The communities are too close to blasting zones which affect their houses.
• Rising criminal levels in the communities.

Recommendations:
• The inclusion of MACUA-WAMUA and the mining-affected communities on policy engagement structures such as Mining Industry Growth, Development and Employment Task Team (MIGDETT)
• A process of improving the Mineral and Petroleum Resources Development Act (MPRDA) including specific targets for women in the MPRDA
• Getting accountability from DMRE for failure to uphold law and comply with MPRDA regulations.
• Temporarily stop the issuing of mining and prospecting licences until DMRE can take responsibility for the failure to monitor and regulate currently operating licence holders.
• Commit to investigate the non-compliance highlighted in the report.
• Commit to reviewing regulations which affect communities when they seek access to information, support and compensation.

Discussion
Ms V Malinga (ANC) asked MACUA-WAMUA to apologise for the disruption they caused at the public hearing on the Gas Amendment Bill. The presentation by MACUA-WAMUA was good because she supports social labour plans and making sure the community benefits from mining companies who mine in their area.

She suggested that the Committee go through all the information that MACUA-WAMUA has presented and give feedback after that.

Ms P Madokwe (EFF) asked that the reports and complaints sent to the DMRE by MACUA and WAMUA be provided so that the Committee can go through them in a separate meeting.

Mr M Mahlaule (ANC) agreed with Ms Malinga's proposal for a separate meeting to go through all the reports. The Committee is more than willing to assist MACUA and WAMUA because they followed the correct steps to present themselves. Their presentation was well researched and showed MACUA-WAMUA's engagement with the mining companies and the communities.

From past experience, MACUA and WAMUA has behaved in an unpleasant manner. Maybe that is why mining companies were less willing to meet with them and the affected communities.

MACUA-WAMUA response
Mr Mbangula thanked the Committee for allowing MACUA-WAMUA to present their findings. Hopefully there can be a way forward to deal with non-compliance by the mines and a platform with the DMRE to help the affected communities.

Mr Mbangula responded to Ms Malinga about the disruption of the public hearing. The members of MACUA-WAMUA did not mean to be disrespectful and disruptive. There was a lot of frustration in the communities because they are not consulted by the mines. There is also forceful removal and damage to houses. There was no capacity to monitor all the members who had attended the hearing.

MACUA-WAMUA wants a platform where they can engage in a meaningful way and present the issues faced by the communities. DMRE has been given reports about these issues. One of them is why does the DMRE continue giving mining licences when there is not a capacity to manage and regulate mines. There are examples of mining companies mining in areas without consulting with the communities. Other ways the platform will help is ensuring that communities are supported and that poverty and inequality is reduced.

Mr Rutledge replied about the documents that have been submitted and the long engagement that MACUA-WAMUA has had with the DMRE and the Committee. There has been little success with a meeting which has caused frustration to MACUA-WAMUA. An example is a meeting in March where the Minister and the Committee made commitments to meet, but the meeting was cancelled at the last minute and there was no further response. It was decided to take actions of civil disobedience to get the attention of the Committee. It is not a good thing when citizens protest to get their voices heard. It is better to have engagements that are organised and well researched.

What has happened in the past is not important. It is important that all the parties involved can talk to one another. MACUA-WAMUA tries to reach out to the mining companies. MACUA-WAMUA has a legal department that sends letters and requests meetings and information so that there is proper engagement. MACUA and WAMUA do not just arrive at a mining company to protest and ask for unreasonable demands. Proper processes have been followed to make sure that South Africa and the communities are built in a constructive way.

Mr Rutledge said that protesting is a constitutional right, but it is often the last resort for underrepresented people. He thanked the Committee for the opportunity to provide a platform for the affected communities to present.

Mining Charter judgement: MACUA-WAMUA input
Mr Christopher Rutledge, Executive Director of MACUA & WAMUA and Mr Paps Lethoko, National Coordinator of the National Association of Artisanal Miners (NAAM) presented, saying there can be very little doubt that the mining sector remains largely untransformed and that the sector only pays lip service to objectives of the MPRDA to ensure that “holders of mining rights contribute towards the socio-economic development of the areas in which they operate in”. The Mining Charter (with proper stakeholder engagements from communities and with binding implications and penalties and with open and transparent auditing processes ) was the most practical way to work towards collective targets for transformation, but the judgement has removed that option. Current legislative accountability measures are vague (does not provide targets and reporting standards ), with inadequate penalties or consequences for non-compliance with no transparency requirements and are not enforced. Mines and the state have a historical, ethical and legal obligation to ensure the social and economic welfare of all South Africans and mines carry a specific obligation to the people who are directly impacted by their mining operations. support the call by MINCOSA for a Transformation Council that includes community, labour, industry and the Department, so that all parties can meet quarterly to discuss transformation in a structured and consistent process. It rejected the claim by MINCOSA that the problem is merely a lack of standardised reporting. Instead research shows that there is a fundamental lack of focus on the developmental objectives. This can only be remedied if the MPRDA is more explicit in its intentions to ensure transformation and if there are severe consequences for non-compliance together with greater transparency and rights afforded to communities.

Artisanal and Informal Mining: MACUA-WAMUA input
Artisanal miners have never been recognized within the current mining regulations. The MPRDA has
excluded them and government has sort to criminalise those who have sort to find a livelihood through artisanal or informal mining. MACUA-WAMUA suggested that contrary to the draft policies claim that the problem is merely one of not “ defining concepts”, it is our contention that the discrimination against poor and marginalised communities and individuals inherent in the MPRDA regulations, is at the heart of the problem. It feared that many of the class discriminations inherent in the MPRDA continues to be advanced in the Draft Regulations.

Discussion
The Chairperson noted there were no questions from Members. He thanked MACUA-WAMUA for the presentation and commented on some of the points. In the absence of a legally approved Mining Charter, what happens to the status of the Mining Charter and the compliance requirements? He thought MACUA-WAMUA would assist the Committee with how to tackle the uncertainty of the Mining Charter, and if it is enforceable or not. What does MACUA-WAMUA think about the audit timelines?

The Chairperson said part of the problem in the Mining Charter is there are no strict time requirements to measure the performance of the mine. An example in government departments is that they present quarterly reports and annual reports to show if they have met their performance targets. The findings will also be shown over a five-year period which is a term. The Mining Charter currently leaves uncertainty on the status of enforceability. DMRE has a small budget compared to the other departments. It is difficult to conduct oversight on every issue that is raised. It needs strategic partners to assist it like key stakeholders such as MACUA-WAMUA.

The Chairperson also stated that the executive should drive a thorough consultation of stakeholders before legislation is submitted to Parliament. The legislative process of Parliament says the Committee can decide whether to go into the communities to hold its public hearings or not. However, the executive should be required to have extensive hearings. An example is the Gas Amendment Bill. A lot of points were only raised at a point where it was too late to include them into the Amendment Bill. Perhaps there should be a different system in place so that the public can have a bigger input into changing legislation at the point where the legislation is drafted by the executive.

An example is the Mining Charter. The decisions and changes that the Committee makes must benefit the community. It should be the responsibility of ward councillors to get information from the communities and this information is presented to parliament structures. The Committee mostly deals with legislative issues. The mayoral council said the Mining Charter is a policy and not legislation. Until Mining Charter is changed into legislation, the Portfolio Committee cannot force people to comply.

The Chairperson agreed that there is a difference between illegal mining and artisanal mining so that not all illegal mining is criminal. There are good examples such as in the Northern Cape of artisanal mining, but there is a big challenge of organised crime. There are also different levels of illegal mining and each one should be dealt with separately. There are some poor communities which are worse off when they are under the support of a mining company because the mine is in a poor condition. If illegal mining takes place, it could be a threat to residential areas and cause a risk because the pillars underground are being mined. The pillars are important to give balance to the ground above, or else the mine will collapse.

With illegal mining it is important to deal with the criminals at the top instead of the low hanging fruit. An example is with diamond mining where there should be strict rules to make it a commodity like gold. Even if the police arrested many of the illegal miners, they are not dealing with the main criminals who are the ones that might have formal licences. The illegal products might be changed to become legal.

Another problem which adds to illegal mining is when active mining stops for a long time because of a business rescue practitioner (BRP) taking over. Illegal activities then can take place which can lead to gangs taking over the area.

The Chairperson asked how can the period of issuing licences be reduced? Should there be a rule of "use it or lose it" for mining licences? Should ownership stay the same even when the mine is under the control of a business rescue practitioner?

There is a view in the policy that artisanal mining does not talk about underground mining but about open cast mining.

These are some of the issues which the Committee can discuss and invite DMRE to make a presentation on the draft policy on artisanal and small-scale mining.

MACUA-WAMUA response
Mr Rutledge spoke about the status of the Mining Charter and where it stands. Before the judgment, the Mining Charter was not a good tool to measure transformation in communities because there was lack of consultation and there were no clear targets for community development.

The Mining Charter is only a policy and will need to become legislation to force changes. The challenge for the Committee is that the Mining Charter has no legal standing. Meaning the communities cannot rely on it to take mining companies to court if they have not delivered. The Mining Charter is not a legal obligation.

The Minerals Council and most businesses generally believe that businesses should have no regulation. It is about accumulating wealth and taking without paying. The lack of regulation has caused the problem of how wealth is accumulated in the sector. The legislation does not regulate wealth distribution in an effective way, which is what the Mining Charter tried to deal with. The Mining Charter should try to regulate wealth distribution and fair distribution of the nation's resources. However, after the judgement there are more limitations. There is nothing to hold mining companies responsible.

The social audits of the mining-affected communities show that mining companies do not comply with social responsibilities, but now it will be worse. The mining licences force the mining company to have a social labour plan, but it is not clear what that means. The company can promise to deliver, but never do it because the law does not enforce it.

The Minerals Council is the product of colonialism and apartheid. They owe a debt of obligation to this nation and the people in mining-affected communities. The Portfolio Committee as part of a democratic Parliament has an obligation to ensure that that happens according to the Constitution.

There is no uncertainty around the Mining Charter anymore. The court has given out the ruling, and it has no standing. The Committee needs to do something about it.

Mr Rutledge responded on the audit timelines. Projects need a lot of time. The first part of a project is often the planning phase, but not much will happen in the first or second year. After planning, the project should be running in the third year so a five year timeline can work. It might not always be helpful to measure every detail, but there must be a level of compliance that is expected and penalties if not met.

It is not possible to expect the Portfolio Committee to monitor all this because it has two big portfolios combined, Minerals and Energy. There is a small budget, limited staff and limited time.

The Chairperson added that if the Mining Charter becomes a legislation, there should be audit timelines built in because there are currently no audit timelines. This will deal with the issue of non-compliance.

Mr Rutledge replied that timelines are important, but the more important issue is that there are penalties for non-delivery. The Minerals Council was bragging to the Committee about a R1 trillion turnover. The kind of projects that the Minerals Council and mining companies generally take on are big and complicated. Community development should take about 0.15% of that budget, but the mining companies do not want to contribute. Mining companies put their energy into projects that have enough reward in it. If there is no penalty for non-compliance and it does not hurt their profit, then social development is not important.

The regulations around the Social and Labour Plan, which the Department published, are helpful because they require regular feedback to communities and structures on a quarterly basis. That kind of feedback and system is important, but the MPRDA needs to strengthen the role that communities can play within those feedback sessions. The requirements on mining companies to be transparent and the nature of how they report back also needs to change. Communities can play a role in helping to manage timelines and hold mining companies accountable. DMRE does not have the ability to do fulfil all the regulations, so it would be wise to include the communities and give them additional legislative power. Mining companies could give quarterly reports and an organisations like MACUA and WAMUA can do a social audit. There just needs to be legislative back up because currently the mining companies still ignore MACUA and WAMUA because there are no penalties.

There must also be more consultation with the public on issues that deal with the legislation. Discussions should take place with the Committee before the they make decisions. An example is the Gas Amendment Bill where DMRE failed to consult with MACUA / WAMUA. Some of the points like the regulation on resettlements, MACUA / WAMUA tried to engage with the DMRE, but the inputs and concerns were ignored. This leads to frustration. The process should be changed so that it says there must be a consultative process before legislation is changed. The consultative process must include the stakeholders and communities so that there are no issues when the points raised get to the Portfolio Committee.

The executive holds too much power. The Portfolio Committee should find a way to decrease the power and include more monitoring so that processes like giving out licences is regulated more.

Illegal mining like organised crime should be separated from the ordinary people who are just trying to put food on the table. The members of MACUA / WAMUA and NAAM are against criminal groups and activities that want to take over the role of the state by threatening communities.

A suggestion is to involve communities in a more structured and coherent way. If there are mines close to communities, the cooperatives must be accountable to the communities in the same way that a large-scale mining company must be accountable to the community. The space for illegal groups to take over will be smaller if the community is involved. The details of the submission have been submitted to DMRE, but it can be shared on request. Proper legal mining should be promoted through proper cooperatives so that the value and benefits go directly to the community.

The policy must deal with underground mining. The problem won't go away just because it has not been legislated, it will become bigger.

DMRE and large-scale mines have not planned for what to do after mining. A lot of the illegal mining happens in towns where mining activity is decreasing but there are no plans to restore and close the mines. If communities are involved with restoring and closing the mines, then the space for illegal mining to take place decreases.

The police should put their focus on high level dealers and not people that play a smaller role. The people at the bottom end of the value chain are not making a lot of money. The miners do not have a large compensation. The illegal syndicates are the ones who are claiming the profits. The ordinary people that the police are arresting are not the problem; but they become a problem if the police is not there. There must be an urgent move to formalise miners in a way that there can be a separation between artisanal miners who are within the system and the illegal syndicates who are operating outside of the system.

The legislation process should be updated from what it was twenty years ago. The political climate has changed, and the awareness of mining-affected communities has also changed.

Mr Mbangula thanked the Committee for allowing MACUA-WAMUA to present. Providing an open platform will allow many of the challenges to be managed in the correct ways and give mining-affected communities a way to share.

The Chairperson said that the Portfolio Committee will go through the submission so that feedback can be given. The issues that MACUA-WAMUA have raised have been noted, although some of them might be too big for the Committee to tackle, they can be dealt with by National Assembly. Rules and regulations can be reviewed so that public participation and the effectiveness of the Portfolio Committee is improved.

MACUA-WAMUA must not wait until the last minute to present to the Committee. The process of making submissions to Parliament is strict and should be followed. If they want to make inputs to legislation and Amendment Bills, they should present their points to the Committee earlier.

The Chairperson went through the minutes of the previous meetings.

The meeting was adjourned.