SA Abattoir Corporation Act Repeal Bill: Agriculture Department briefing

Meeting report

LAND AND ENVIRONMENTAL AFFAIRS SELECT COMMITTEE
14 June 2005
SA ABATTOIR CORPORATION ACT REPEAL BILL: AGRICULTURE DEPARTMENT BRIEFING

Chairperson: Reverend P Moatshe (ANC, North-West)

Documents handed out:
Department briefing on SA Abattoir Corporation Act Repeal Bill [B21 – 2005]

SUMMARY
The Department of Agriculture and Land Affairs presented background information on the SA Abattoir Corporation Act that provided for the incorporation of the SA Abattoir Corporation (Abakor). Abakor had since been liquidated, rendering the Act useless. The Committee discussed liquidation and the staffmembers of the Meat Industry Trust, before accepting the Department’s proposal and passing a Motion of Desirability to repeal the South African Abattoir Corporation Act Number 120 of of 1992.

The Chairperson read a proposal from the Portfolio Committee on Water Affairs and Forestry, which had asked for suggestions of places to visit on their coming oversight visits. The Committee proposed that the Chairperson send reports of their previous visits to the Portfolio Committee, and later get a reportback.

MINUTES

Department briefing
Mr Lufumo Makhoshi (Department Legal Officer) said the South African Abattoir Corporation Act had come into effect on 10 July 1992. Its purpose was to abolish the Abattoir Commission and provide for the incorporation of the South African Abattoir Corporation as a public company and the disposal of company shares held by the State. Pursuant to the Act, the South African Abattoir Corporation (Abakor) was registered and incorporated into a public company. All the assets, liabilities, rights and obligations of the Corporation, had passed on to Abakor, with the State as the only shareholder. The directors of Abakor could only alter the share capital with the approval of the Ministers of Agriculture and Finance.

Abakor had not managed to pay its debts to a number of creditors, including the Meat Board (which later became known as the Meat Industry Trust). This had resulted in liquidation proceedings in the High Court. The final liquidation and distribution account was confirmed on 11 December 2003. This was announced in Government Gazette No 25906 of 16 January 2004. The liquidation process had now been finalised. The South African Abattoir Corporation Act had become obsolete as a result of Abakor being liquidated. Therefore the Act needed be repealed.

Discussion
Mr A Watson (DA, Mpumalanga) asked what had become of the functions previously performed by Abakor. Mr Makhoshi said that the agricultural sector had been deregulated during the 1990s and as a result, the Abattoir Commission had been phased out. The industry could now regulate itself.

Mr L van Rooyen (ANC, Free State) asked about the members of the Meat Industry Trust. Mr Makhoshi said the Red Meat Association and others were members of the Meat Industry Trust. ‘Organised agriculture’ had previously constituted the members of the Meat Board. Transformation in Bloemfontein seemed questionable. He also asked what role the Meat Industry Trust had played in the liquidation of Abakor.

The Chairperson asked for clarification on Abakor’s inability to pay its debts and the reasons for the liquidation in the High Court.

Mr M Mzizi (IFP, Gauteng) asked who was liable for Abakor’s debts. Mr Makhoshi responded that usually a company could apply for voluntary liquidation if its debts could not be settled. If creditors could not be paid, they could apply to the courts for compulsory liquidation. The Court would then place the company under provisional liquidation. This would allow the applicant to investigate the possibility of dealing with the matter in another way. Once a final liquidation order had been given, stock and the company’s assets would be sold and used to pay the creditors. Some of the creditors would only be paid out partially.

Ms M Oliphant (ANC, KwaZulu-Natal) felt the Bill did not warrant further discussion. She asked that the Department brief the Committee on the Meat Industry Trust. The Chairperson said this could be organised.

The Committee accepted the Department’s proposal and passed a Motion of Desirability to repeal the South African Abattoir Corporation Act. This would be called the South African Abattoir Corporation Repeal Act. The Committee also accepted the report on the South African Abattoir Corporation Repeal Bill {B21-2005] without amendments.

Committee Clerk’s minutes
The Committee adopted the Clerk’s minutes of 18 May and 26 May, 1, 2 and 7 June 2005 without amendments.

Portfolio Committee on Water Affairs and Forestry proposal
The Chairperson read a proposal from the Portfolio Committee on Water Affairs and Forestry, informing that they would visit KwaZulu-Natal and Mpumalanga from 31 July 31 to 5 August 2005. The objective of the visit would be look at service delivery, poverty alleviation, job creation and community involvement. The Portfolio Committee was in the process of compiling a programme and had asked the Select Committee for suggestions of places to include on their visit.

Mr Mzizi said this invitation was welcome, but he did not think it would be appropriate to say where they should visit. He would welcome a report of their visit.

Mr Watson thought they should complement the Portfolio Committee. The Committee has been on oversight visits and, among others, discovered problems with water delivery near Pretoria. It might be a good idea to have follow-ups on what was promised to the Committee during these visits.

Ms Oliphant said a provincial week had been set aside for the Committee to visit the provinces. They would visit KwaZulu-Natal. They had to do follow-ups, but they would have to give Department officials time to act on the issues. She proposed that the Portfolio Committee be asked to brief the Committee on their findings and suggested that the Chairperson give copies of the reports of their visits to the Portfolio Committee. The Chairperson agreed.

The meeting was adjourned.