Hansard: Approppriation Bill: Debate on Vote No 16 – Tourism

House: National Assembly

Date of Meeting: 02 May 2012

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PROCEEDINGS OF EXTENDED PUBLIC COMMITTEE – E249 CHAMBER

Members of the Extended Public Committee met in the E249 Chamber at 14:05.

House Chairperson Mr C T Frolick, as Chairperson, took the Chair and requested members to observe a moment of silence for prayers or meditation.

The MINISTER OF TOURISM

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APPROPRIATION BILL

Debate on Vote No 35 – TOURISM:

The MINISTER OF TOURISM: Hon Chairperson, South Africa's status as a premier global leisure destination is now firmly established. We have the capability and the means, the welcoming culture, and the varied, textured, beautiful destination that the world's travellers ever more demanding and discerning, want when they choose a destination.

Our vision for the department is to be a catalyst for tourism growth and development in our country in order to crystallise the tourism mandate - our National Tourism Sector Strategy, NTSS, which we adopted exactly one year ago. Furthermore, the draft Tourism Bill has been developed as a legal framework. Public and stakeholder participation has been concluded, and the draft Bill will be introduced to Parliament during the third quarter of this year.


In 1950 the world had 25 million international arrivals, whereas in 2011 it had 980 million. It is estimated that in 2012, this year, there will be, for the first time ever, one billion international arrivals. Within a decade, this figure is forecast to increase to 1,6 billion exponential growth. International competition in the tourism market will be vigorous. Our efforts will thus require flexibility, innovation and responsiveness.

During the last five years, our country has outpaced the growth of all competitor locations in the leisure arrivals category.Foreign direct spend in rand terms has grown faster than arrivals, with an 11% per-annum growth rate. South Africa's tourism industry has also managed to build on the momentum achieved during a record-breaking 2010 by growing a further 3,3% and attracting over 8,3 million international tourists in 2011. As members will recall, it is obvious that tourism is a narrower category than all international arrivals.

While South Africa's core markets in Europe and North America remain our major source of long-haul tourists, the country's overall tourism growth in 2011 was largely due to a 14,6% growth in the emerging markets of Asia, driven by a growth of 24,3% from China and 26,2% from India. Tourist numbers were also up - thanks to a 6,9% increase in arrivals from our continent.

European tourist arrivals declined by 3,5%, largely due to the ongoing impact of the global economic crisis in many countries in Europe. There are exceptions, German markets grew by almost 10% and that was good news. North American numbers grew by 2,3% despite that that continent was also facing major economic challenges.

In order for our country to respond favourably to, inter alia, the global challenges facing the growth and development of tourism, our department has established an international tourism management branch. The objective of this branch is to provide strategic, political and policy direction for the development of South Africa's tourism potential across various regions of the world. This will be done working together with key departments such as the Department of International Relations and Co-operation, including our diplomatic missions around the world, the Department of Home Affairs and the Department of Transport.

In this way, we hope to extend the work of the department to improve the competitiveness of South Africa's tourism industry in the global arena. The marketing of South Africa as a destination remains the mandate of South African Tourism. Currently, the South African Tourism has 128 joint marketing agreements in place across the tourism industry, with successful partnerships in our key markets.

South Africa also held on to its World Cup year growth of 66,7% out of Brazil. It was from a relatively low base. In 2011 we grew by a further 0,8% on top of that 66,7%. I would also like to announce that SA Tourism plans to increase its focus on this market, opening an office in Brazil in the coming financial year.

From an African continental perspective, Nigeria and Tanzania were two of the continent's biggest growth markets in 2011, with tourist arrivals from these two countries growing by 37,5% and 45,8% respectively. We will be investing R218 million over the next three financial years to support South African Tourism's efforts to grow our share of the African market. We have opened a country office in Angola, and plan to have five SAT offices open on the continent in the next five years; hopefully, before the time; and the second of which is set to open in Nigeria in the coming financial year.

This past financial year has also seen business tourism taking centre stage, especially in light of the establishment of our first National Conventions Bureau, which is now a business unit in South African tourism. For the next five years, our country has already secured over 200 international conferences, which are estimated to attract 300 000 delegates and provide an economic boost of more than R1,6 billion.

Turning to the domestic side of business, the National Tourism Sector Strategy has, among others, identified domestic tourism as a critical element, not only in reaching the job creation targets set by government, but in doing so, also developing a sustainable and reliable basis on which future tourism growth can flourish.

The Domestic Tourism Growth Strategy is now in place, with a clear action plan and organisational structural capacity to support implementation. This is effectively supported by a campaign which was launched yesterday: "Whatever you are looking for, it's here". We don't only want South Africans to want to discover more about their country, but this campaign will also contribute to the development of a culture of tourism and the enhancement of social cohesion among South Africans. This new domestic tourism campaign now focuses on a larger cross-section of the population.

The department has also restructured, with the Domestic Tourism Management Branch, now specifically focusing on providing strategic, political and policy direction for national tourism management. During this financial year, the Tourism Empowerment Council of South Africa, Tecsa, also commonly known as the Tourism BEE Charter Council, will be appointed to monitor the implementation of the sector transformation agenda.

The Tourism Empowerment Council of South Africa is tasked with monitoring the implementation of the section 9(1) gazetted Tourism BEE Charter and scorecard in order to achieve economic transformation of the tourism sector against the sector targets. I would like to remind hon members, I reported back to the audit the previous year, that we were the first sector ever, to have a unanimous and agreed charter between government and all the stakeholders in the private sector.

The Tourism Grading Council of South Africa has also done superb work, specifically in the past financial year. With the introduction of the new, stricter and more comprehensive grading criteria, it is most encouraging to note that the grading council chairperson managed to attract 1 165 new establishments in the past 12 months.


The past financial year has also seen the department delivering on a number of key objectives relating to product development, namely the development of the Heritage and Cultural Tourism Strategy as well as the Rural Tourism Strategy. The former aims to mainstream heritage and cultural resources into the ambit of tourism, and thereby enhance the country's competitive edge as a tourist destination.

The Rural Tourism Strategy will in turn focus on ensuring a more even geographic spread of tourism, with more emphasis on supporting tourism growth in rural areas in particular, with more rural community involvement. I would like to thank the Deputy Minister for her role in that regard. Later on she will also report to Parliament.

The importance of intergovernmental relations in implementing this strategy cannot be overemphasised. However, the success of this strategy is wholly dependent on provincial and local government also playing their part. During the past financial year, the department exceeded its Expanded Public Works Programme target for fulltime equivalent jobs. As part of this programme, training or skills development is critical for the tourism sector.

The department has many successful Social Responsibility Implementation, SRI, programmes. I would like to mention one specific project that is very close to my heart, namely, the Young Chefs training programme. A month or two ago, Members of Parliament were also present at the graduation ceremony. We launched and implemented this programme last year as part of the department's Expanded Public Works Programme, SRI initiative.

To date, 545 young persons have graduated as chefs and 120 have already been placed with established hospitality institutes, such as hotels, bed and breakfast establishments and restaurants. [Applause.] Altogether 300 of the 545 have been enrolled for second level training, and owing to the success of the programme, another 500 young people have been enrolled for the first time. One of the lessons that I think all of us, across government should take from this programme is that it is one thing to train people and quite another to make sure that they have jobs afterwards. This is the success of this programme.

The sector is also a fertile environment for entrepreneurs and small, medium and micro-sized enterprises, SMMEs. We will continue collaborating with the Tourism Enterprises Partnership, Tep. The Tourism Enterprises Partnership was successful in achieving and exceeding its performance indicators over the past year. For 2011, Tep supported 4 991 jobs created by SMMEs, which delivered an increased turnover of R454 million. This raised Tep's contribution to job creation over the past ten years to more than 66 900 jobs and a turnover of over R5,3 billion.

Once again, the lesson that we can learn from this programme is that there are some things that government can do and some that the private sector can and should do. Very often, partnerships with private sectors are much more successful that when we try doing things on our own.

As a long-haul destination, we are heavily dependent on airlift capacity, particularly for the traditional and emerging markets. Recent developments in this area, such as the loss of capacity by some of our core markets, the fluctuations in the oil price and the unilateral approach taken by the European Union in the implementation of the carbon emissions trading scheme – the

so-called EU ETS, are cause for concern.

We are working with the Department of Transport and other partners to review the 2006 airlift strategy with a view to enhancing airlift capacity. We will continue to work with the international community through multilateral and other formations, to work towards progressive, fair and consensus-based schemes for a more responsible tourism approach from an air transport perspective.

Those colleagues who might not be aware, may not know, but those in the committee might be fully briefed, that this system will actually levy a tax on all airlines all over the world, flying to and from Europe, but also when they fly out of European airspace. It is usually detrimental for our own airlines, but also obviously, for long-haul destinations.

The sustainability of our achievements also depends on our ability to plan for the future, in both the medium and long-term. With constant change in the geopolitical, economic, social, technological and consumer landscape, it is beneficial for us to understand how these megatrends may affect our country as a destination as well as our source markets in the future. In this regard, the department has begun working on possible future scenarios for 2030. Once that has been concluded, we are quite happy to brief the committee and share that with them and to look at the implications what this means for our sector. This will ensure that there is no room for complacency and that there is continuous robust planning that takes the different futures and scenarios into account.

In conclusion, I would like to take a moment to thank our Deputy Minister, Ms Tokozile Xasa, for her commitment to the portfolio and for sharing this journey with the department. I will also like to thank the Director-General, Mr Kingsley Makhubela, and the very capable team of leadership for bringing our new department this far in a very short time. Director-General, thank you for your strategic leadership and guiding vision for the future of tourism.

Furthermore, the unqualified report of the Auditor-General after the 2010-11 audit, which was the department's first audit as a standalone department, demonstrates administrative success in establishing a sound governance foundation that will support the implementation of our mandate.

A special thank to Mr Thulani Nzima, who is the new SA Tourism Chief Executive Officer, and his equally excellent team for working very hard together with the department to achieve our targets. In addition, I would like to express the department and SA Tourism's gratitude towards the private sector for the constructive relationship we have. Thank you to all our partners for engaging with us, and for your commitment to our shared growth goals.

To the Chairperson, Mr Gumede and all members of our portfolio committee, we value and appreciate the good working relationship with Parliament. I thank you. [Applause.]

Mr D M GUMEDE.../TM / END OF TAKE

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THE MINISTER OF TOURISM

Mr D M GUMEDE: Hon Chairperson, hon Minister, hon Deputy Minister, hon members and esteemed ladies and gentlemen, let me first thank every member of the committee for constructive contribution, constructive criticism and a consciousness of putting our beloved country first. You have used your right to disagree in a mature manner, and this gives me hope that, as we move forward, we shall be an even stronger democracy. I am indeed proud to be one of you. We all agree that there should be a better quality of life for all and that we all have a role in making it a reality.

Allow me to begin with the goal of the budget, and then take a look at the different programmes of the budget and areas of interest, and perhaps concerns going forward. Firstly, it is important to take note of the global and domestic financial climate. We did, indeed, expect that the global economic crisis over the past few years would seriously affect key tourism markets and we were not surprised to learn that some of our markets have shown a decline in growth. We were much relieved to learn that we continued to grow whilst other countries were showing a marked decline.

However, the question still remains: Given the hostile global financial situation, has the department done its best, given the available resources and capacities at its disposal? Our view is, largely, yes, though it could have done better in some areas as well, like in transformation, small business funding and support, job creation, and in the Expanded Public Works Programme, EPWP. The latter shall be one of our areas of focus, as it assists in creating jobs, and job creation is a priority.

I now come back to the aim of the budget of the Department of Tourism, which is to:

Promote and support growth and development of an equitable, competitive and sustainable tourism sector, enhancing its contribution to national priorities.

That is what we budget for, according to the Estimates of National Expenditure.

Our budget for this year stands at R1,37 billion. The role of Parliament is to oversee the use of this budget via annual reports, quarterly performance reports, asking the Minister questions, and oversight visits, among others. Different speakers will elaborate on the different programme areas, according to their areas of interest.

Looking at performance in general, South Africa as a country has achieved a tourism growth rate above the growth of the South African economy as a whole, and has done better than global tourism. We thank the department and each and every stakeholder for this massive effort. In that regard, some of us have just voted for Table Mountain to be one of the New Seven Wonders of the World. Yes indeed, Table Mountain, just outside here, is now one of the New Seven Wonders of the World, and I am proud to say one of the votes that counted was mine. [Applause.]

In spite of the difficult economic conditions in our traditional global markets, we have managed to have growth that any tourism destination in the world can be proud of. I thank you, Minister, and your team for that achievement. Surely, tourism can do even better with more resources, as well.

Job creation and sustainable livelihoods are a national priority, as I said before. Job creation in the services sector, especially in tourism, is very important, as many employees do not need to be highly skilled or very experienced. Thus, it makes it very accessible to the youth and unskilled and semiskilled workers, especially in the rural areas. With sustainable livelihoods and small businesses, entry barriers to some sectors within the tourism industry are low, and the more the activity in the industry, the better the chances are for many small businesses to be established. More jobs will be created - this will lower joblessness, inequality and poverty - and many of the jobs will be sustainable.

As the Diagnostic Overview Report notes, South Africa has an overdependence on trading in resources, and this is unsustainable. Given the above, tourism growth gives us hope in contributing to bigger growth and a bigger economy. The overview continues as follows:

The country's exceptional biodiversity is internationally recognised and its economic and social importance is reflected in reasonably well-functioning institutions in formally protected conservation areas which support an important tourism industry.

We have elephant and eland grazing next to lion, rhebok, zebra and rhino, among many. This makes us competitive as a destination, as well, and also gives us even more reason and responsibility to save the rhino from extinction. The threat of the extinction of the rhino may turn into an opportunity because of its perceived rarity. This has the potential of being a draw card in the future. So, let us actively join the fight to save the rhino. Let us make it our duty to protect the rhino, for the rhino is our future. Let us not allow it to die the death of the dodo.

Beyond our biodiversity, we still have many stories of our journey as a nation that have not been told boldly enough. We are a nation with many pathways that have converged into a new South Africa. We have precolonial trade routes through Africa. We have had colonial wars, the sites of which are known. We have had imfecane/difaqane [war]. We have had treks of different peoples of South Africa. There are caves, oceans and rivers in our journey of worship, and the journey of our liberation, among others. Yet, we are not telling the stories, which we have to.

Quite often, we relegate tourism, particularly cultural and heritage tourism to the bottom of the list of our budgetary needs at all levels of government. Indeed, we need a paradigm shift in this regard, starting from the political leadership of different parties at all levels down to every one of us. Tourism complements service delivery. It does not adversely compete with the delivery of basic needs.

Let us promote tourism even better and I know we are doing our best with what we have. For instance, on our visit to China, we learnt that in its five-year plan, it projects the entire number of global tourists to be at about 80 million people, and if we strive for 1% of that, we are talking of 800 000 tourists. This is an opportunity worth looking at. Our political principals have opened the way for this possibility – let us use it. Then the question will be, Are our strategies in line with this emerging possibility?

Despite many challenges, we believe that the funds will be under good stewardship, and I thank you very much. We support this Budget Vote. Thank you. [Time expired.]

Mr S B FARROW / Robyn / END OF TAKE

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Mr D M GUMEDE

Mr S B FARROW: Tourism is a major contributor to South Africa's gross domestic product, GDP. It brings foreign currency into the country and this, in turn, creates jobs. Job creation and dealing with high unemployment has become one of the biggest challenges and, currently, is the biggest threat to our young democracy. With one in four of our active population out of work, it is surprising that tourism has not been given the priority and emphasis it deserves in the President's state of the nation address on the one hand, and the National Development Plan on the other.

Maybe the Minister and the Deputy Minister could spend a bit more time convincing the Cabinet of the importance of tourism and how, if given more funding, they could increase the inflow of foreign visitors and encourage our citizens to spend more time at home enjoying our beautiful resorts. If they do so, every 16 tourists could create a job, and if we can reach that magic projection of 11 million tourists, this could realise approximately 687 000 jobs. If tourists could be enticed to stay a bit longer and spend more money, we might be closer to the international average of 11 to 12 tourists per job.

Our landscape offers as much diversity as our population and we are further endowed with a vast range of fauna and flora and numerous wildlife and insects species abound, all of which should create an awareness and desire for the curious and imaginative tourist to visit our shores.

Visitors to our country come here for a number of reasons, and for far too long we have relied on arrivals at the airports and ports of entry to determine our statistics. This, unfortunately, does not tell us why the visitor arrived on our shores. Marketing South Africa as a tourist destination requires a focus determined effort across all spheres of government. In the short time that I have served on this portfolio committee, I have been surprised as to how many arms of government are required to perform, in order for all the efforts of tourism's aggressive marketing to pay off at the end of the day.

A simple tick-the-box type arrival card at each point of arrival could easily determine the reasons for the visit, be it a holiday, family visit, business, convention, etc. A similar arrangement could be done at hotels, guesthouses, lodges, and game parks, in order to pick up on the domestic tourists and why they are there.

Setting key objectives and priorities is all very well, but if Home Affairs, for instance, cannot produce the visas timeously or affordably, then all the department's efforts are wasted. Equally, if the South African police force cannot keep our tourists safe, then they would not come here. The latest incidents of gender-based violence and violence in general all contribute to how South Africa is perceived internationally. Equally as damaging has been the publicity around the rhino poaching and the involvement of SA National Parks, Sanparks, officials in those particular merciless slaughters.

In the same vein, if tourists are expected to travel by bus or car, our roads should be safe, free of potholes and the vehicles they use unhindered by unnecessary harassment by overzealous traffic cops that sometimes police our streets.They need to know and understand the license conditions of tourist operators and hired car permits and not leave them stranded on the roads when they pull them over.

Marketing tourism is a highly competitive field worldwide as each country attempts to lure tourists into their respective countries and to their attractions. This often involves cut-price travel packages, discounting accommodation, meals and transfers.

Tourists, however, do not want compromised service levels; they want clean rooms, safe water, modern plumbing, and fresh and affordable food. Here we tend to shoot ourselves in the foot. The World Cup was a case in point where accommodation costs were excessively increased and food was priced around dollar and pound values. Unfortunately, this practice has lingered and has only resulted in chasing away many potential domestic and international tourists. Our Waterfront right here is another example; it is far too expensive for people to go there. I mean the average person.

In light of the above cross-cutting matters, Minister, it is imperative that you hold these and any other Ministries to account through effective and accountable Memorandums of Understanding. I am aware that you have some of these in existence, but what I have asked the portfolio committee is that we should have those for scrutiny and to hold those respective Ministries accountable on your behalf.

Having served in the Portfolio Committee on Transport for some years, I am also concerned that certain anomalies still exist in the National Land Transport Act which has major repercussions for tourist operators. It has been three years since that Act was passed through this House, and no progress has been made to effect the amendment.

We have some of the most beautiful airports in the world, and some of them, like the Cape Town International Airport, have received awards like the Best Airport in Africa and the Skytrax Award for Service Excellence. These are all very nice, but if the Airports Company of SA cannot curtail the tariffs, we could be pricing ourselves out of the market.

On the same topic, despite a marked reduction in baggage, pilfering at our airports is still prevalent. We have all the CCTV cameras and everything, but we cannot really put an end to it. Anyone who has experienced that invasion of privacy and lost their possessions can relate. We also, as you mentioned, need to sign off on the airlift strategy and open our skies, in terms of the policies that we determine.

One of the concerns I raised at the portfolio committee briefings related to possible duplication in the newly-created international marketing arm. Maybe I do not understand this, but the department, as I understand, is going to setup these new tourist offices and they could be and might be in duplication of the embassies that exist and have the similar sort of arrangement for tourism and trade.

In a similar vein, we see provincial and local governments advertising regularly in our national newspapers and promoting their specific attractions. How are all these efforts co-ordinated and aligned from a marketing and financial point of view, in order to achieve optimum benefit? I know that in the Western Cape Alan Winde chose to create a single economic development agency for tourism destination market and trade and investment promotion from all accounts and it seems to be working well. In the DA, we believe in creating jobs through the open opportunity society. From my mind, no better opportunity exists for bettering oneself than from the Rural Tourism Strategy and the community tourism industry.

Given the diversity of our population, our rich cultural and traditional heritage and the state's policy on the Green Economy Accord, one does not have to look far to see the potential for making exclusive African curios, developing traditional villages, eateries and opening homes for bed and breakfast facilities or providing tourist guides to cultural and heritage sites.

The Department of Trade and Industry provided grants for this purpose and, to this end, over 265 small businesses for accommodation were assisted; a commendable supplement to your department's effort to create sustainable jobs under the Extended Public Works Programme. However, questions arise as to exactly how many jobs were created and how closely these are being assessed, monitored and sustained?

The Department of Tourism, despite all its interdependency, is doing very well, and it has committed and passionate staff. However, it lags behind when it comes to transformation. With all the opportunities available to it to address the past, it has not seen it fit to reinstate the body formed to look after transformation in the field of the operation. It is troubling that the Tourism Empowerment Council is no longer functional and has not completed its task. This is how we understood it from one of the briefing we got, and that is there basically to redress the racially unequal ownership of enterprise within the tourism sector.

The reappointment of these councillors which you have now reported on subsequently is absolutely essential, if you want to achieve what is laid down in your department's black economic empowerment, BEE, Charter, and it is an absolute must if you want to retain your office.

Much controversy exists about cruise liners. I did have a chat to you about this, but I think another alternative would be to look into registering our own cruise liner. That way the benefits would derive directly from the cruise and all the services that we would offer them for the port of entry.

In the Western Cape, we have one of the most sought after steam enthusiast rail routes running from George to Knysna along the beautiful scenic Garden Route. Part of its line was damaged during the floods of 2006. In order for the Outeniqua Choo-Tjoe to start operating, Transnet needs to hand over some lines and facilities to the Western Cape Department of Transport, which it agreed to in 2010. There has been a subsequent change of chief executive officers, and this has not been resolved and millions of rands of revenue and hundreds of downstream beneficiaries have lost potential income.

Finally, let us come to the matter of the budget. Once more, the department's budget has reflected very little growth - 2,07% in real terms. Despite this department being responsible for the fastest growing industry in South Africa since our new democracy, and contributing 8,3% to the GDP, Treasury chose to give the Department of Tourism only 8,1% across all its programmes. This is not good, considering the department's restructuring and ambitious plans. It is noted though that some R270 million in cash and equivalents are sitting in various bank accounts across the world as of the 31 March. With Treasury, as you all know, if you do not spend or have the capacity for it you lose, you do not get it the following year. The question must be asked, will this be enough to shape our future together? Thank you. [Applause.]

Mrs M A A NJOBE / Mpho/UNH (Checked) / END OF TAKE

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Mr S B FARROW

Mrs M A A NJOBE: Hon Chairperson, hon Minister, hon members, during its oversight visits in the past financial years, the Portfolio Committee on Tourism noted the lack of infrastructure in some provinces, as one of the major constraints in ensuring that the country's tourism potential is realised.

Thus, the invitation to the nation as a whole by President Zuma, while delivering the state of the nation address to join government in what he termed, "the massive infrastructure development drive" should be seen as a great stride that should contribute to tourism growth and development.

The project places the construction of roads, railways, airports and provision of electricity and water at the centre of this year's national priorities. Meanwhile, South Africa sits with 7 000 km of rail track that is not put into use and is not maintained. Government ought to encourage the private sector to utilise this infrastructure and create new services primarily aimed at the leisure market.

The Department of Tourism, in its marketing message, has identified the need to encourage South Africans, "to move away from purpose to leisure travel". The existing rail infrastructure must be developed, improved and put into use if its total disrepair is to be avoided. No doubt the charm of rail transport has a great attraction for all tourists, domestic and international. Surely, the Blue Train cannot be the only offer South Africa has. Rather, South Africa must wake up to the abundance of opportunities that exist for job creation.

The recognition by the department of the importance of marketing South Africa as the best destination to visit the African States is welcomed. With an additional allocation of R218 million for this purpose in the medium term, the South African tourism entity will expand its work to grow the number of tourist visits from Africa.

We can only hope that the marketing strategy for Africa will be relevant. For example, there would be no point in encouraging West Africans to visit the Kruger National Park as there are more and bigger lions and tigers in their countries than in South Africa.

The South African tourism entity markets South Africa to the rest of the world but also domestically within the country. The continued increase in the number of international tourist visits from year to year, in spite of the global recession, is testimony to the resilient efforts made by this entity. The number of domestic travellers has also seen a steady increase in the past financial year.

However, the challenge to fully develop the potential for domestic tourism remains. In a recent presentation by the Tourism Business Council of South Africa, TBCSA, to the portfolio committee, a suggestion was made that indeed, to boost the local tourism industry and maximise its contribution to the economy, there is a need to establish a separate entity to market tourism.

Hon Chairperson, Cope is inclined to support this view though we are aware of possible budget implications. Some of the reasons for this support are as follows.

This would leave the South African tourism with more time at its disposal to focus on international marketing. The entity would be responsible for all the four subprogrammes under Programme 4, which is domestic tourism, and would also have sufficient time to pay attention to detail, ensuring achievement of targets that have been set.

It would also focus on current challenges such as providing support to Small, Medium and Micro Enterprises, SMMEs, for economic development and job creation, monitoring targeted enterprises and ensuringthat they yield positive results.

It would focus on and promote cultural and heritage tourism projects, encouraging more sustainable investment and better upkeep of heritage sites by provinces and municipalities, while also encouraging private public partnerships.

It would closely monitor and evaluate the Expanded Public Works Programme, EPWP, of the department, closely assessing the projects and their impact on job creation and skills development, but also addressing concerns such as those raised by the Auditor-General in the past years' budget.

All this, hon Minister, would be part of the local marketing which is currently a responsibility of South African tourism.The importance of marketing South Africa to its own citizens cannot be overemphasised. We need to be more aggressive in doing so.

In India, for example, stickers in the streets of some cities exhort the people with the words, "Tourism works for you".

People need to know this and internalise the message. In Mexico the slogan is also very appealing to both domestic and international tourists, "The Mexico you thought you knew". With such an appealing message, one cannot but move away from purpose to leisure travel. You just feel like travelling!

I am not in anyway implying that South Africa copycats the slogans. We are capable of inventing our own to ensure we educate our people on all the benefits of tourism.

Lastly, Cope wishes to reiterate the need and urgency for improved interdepartmental and intergovernmental co-ordination to ensure the success of tourism in our country. With only 18 years to the year 2030, by which time it is envisaged that most, if not all South Africans, will enjoy the much promised better life for all, co-ordination within departments and among the three spheres of government is no longer a choice, but a must.

The tourism industry and its attractions are located in the provinces and in the municipalities, and its success isdependant on other sectors. Such co-ordination, if taken seriously, can lead to improvements in product development.

One thing the portfolio committee delegation to Mexico in January this year learnt was the importance of the involvement of all stakeholders in developing all tourism products prior to implementation. [Time Expired.] [Applause.]

Mrs C N Z ZIKALALA

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Mrs M A A NJOBE

Mrs C N Z ZIKALALA: Hon Chairperson, tourists visit our country and continent to experience the magic and majesty of all that is African.

South Africa plays, in many instances, the gateway to the rest of Africa, the frontline, if you will, of the first

African experience for the overseas visitors. As such, we need to ensure that all relevant factors that make choosing, and thereafter, preferring South Africa as a travel destination amongst international travellers are addressed.

The advent of the 2012 Soccer World Cup extravaganza saw much needed upgrades to our air, road and rail infrastructure allowing tourists a more efficient and safe

travel experience within our country.

The hindrance, however, remains the proximity to our tourism generating areas. South Africa is for the majority of tourists, a long haul tourist destination, and as such, we are held hostage by the airline industry whose excessive prices can

sometimes cost us right out of the market when it comes to attracting tourists from other continents.

How does the Minister and his department intend addressing this problem? Cultural events, cuisine and lifestyle also play a significant role in attracting tourists. These might take the form of festivals, religious or traditional events, such as the Annual Reed Dance Festival at the eNyokeni Palace in KwaZulu-Natal or the ukweshwama - First Fruits Festival - and the dance of the maidens as a weapon in the war against HIV and Aids festivals to name a few. These events, however, are not given the necessary international showcasing they deserve. The net result being that our country and traditional communities are the ultimate losers herein as much needed tourist revenue never arrives.

If we turn to our game parks, which are the veritable jewels in the crown of South African tourism, poaching and associated acts of violence are, however, severely depressing international demand for visits to these wild sanctuaries. We therefore stress again the need for tourists to feel safe and secure when visiting our country and for the toughest of criminal sanctions to be legislated and meted out to those who contravene our laws in any way. Cheers! [Laughter.]

The travel industry as well as in most instances follows a profit above-all-else mind set. This greatly impacts both our domestic and international tourism markets with major impacts upon our domestic tourism market. This kind of thinking does not encourage tourism and the department should explore various avenues in which to educate our travel industry and tourism operators on the best ways to incentivise and not drive away tourists.

Emerging international tourism markets must also be tapped and vigorously engaged by the department so as to ensure that an adequate market share therefore comes to South Africa. The IFP supports the budget. Thank you. [Time expired.] [Applause.]

Mrs X C MAKASI / ///NPM & AZM/ VM/ END OF TAKE

UNREVISED HANSARD

EPC COMMITTEE ROOM E249

Wednesday, 3 May 2012 Take: 355


Mrs C N Z ZIKALALA

Mrs X C MAKASI: Hon Chairperson, hon Minister and hon Deputy Minister, hon members and guests from the department. The developmental state's responsibility is to drive and manage the economy places tourism as a key pillar in the generation of growth and development. The tourism sector, in particular cultural and indigenous tourism, has an important role to play in the contribution towards the eradication of poverty, tackling unemployment and addressing inequalities.

The strategic objectives of tourism should be the unlocking of cultural and indigenous tourism potential and addressing the issue of geographic, seasonal and rural spread. This form of tourism has a special impact in rural development. Economic development in the rural areas is integrally linked with cultural and indigenous tourism growth, jobs and sustainable livelihoods.

The ongoing promotion of tourism development in rural areas is central to historical, heritage and cultural sites being developed, as well as liberation struggle routes, all of which will benefit poor and rural communities. It is, therefore, encouraging that the department's medium-term strategic plan for the period 2012-16 identifies the development of niche products such as cultural heritage tourism as a priority.

The Minister of Tourism, hon Marthinus van Schalkwyk, launched the National Rural Tourism Strategy on 11 April 2012 and also unveiled phase three of the Donkey Cart Project at Wupperthal in the Cederberg area. At that occasion, the Minister said, and I quote:

Community beneficiation is at the heart of the National Rural Tourism Strategy, which is aimed at developing rural tourism. This can greatly contribute to the alleviation of pressure in areas that are often characterised by poverty and underdevelopment.

This strategy illustrates the national Department of Tourism's commitment to the development of rural economies in general and rural tourism in particular that can contribute significantly to the improvement of the quality of life of the rural poor.

However, the main problematic areas hampering rural tourism development have been identified as the inadequate funding and resources for tourism in rural areas; a number of key rural tourist attractions are located in rural areas and are not receiving a benefit stemming from the tourism industry; and the limited involvement of local communities serves as a major constraint in developing tourism in rural areas.

In order to address these challenges, the strategy inter alia aims to facilitate the co-ordination of rural tourism development initiatives among relevant stakeholders; to create an enabling environment for rural tourism development to stimulate job creation; and to identify and recommend strategic areas for tourism development in rural areas within the sector.

In his 2012 state of the nation address, President Jacob Zuma identified job creation as key to the alleviation of poverty and the eradication of unemployment. He also stated in an address to the Tourism Business Council in March 2009 that South Africa is faced with challenges of growing and stabilising the economy, ensuring food security, creating sustainable jobs and eradicating poverty, and that the unprecedented socioeconomic benefits offered by tourism demonstrate this as a strategic industry for investment and business opportunities.

The department and key stakeholders, in the spirit of together we can do more, have to ensure that steps are taken to realise the development of transformation of this historically and culturally important component of the economy.

The department's four-budget programmes have been changed from the previous financial years. Domestic tourism is one of the three new programmes. The fact that one of the programmes will henceforth be dedicated specifically to domestic tourism, which encapsulates indigenous, rural, historical and cultural tourism, is a clear indication that more attention will be paid to the resources earmarked for tourism within our own borders.

Twenty five per cent of the 2012-13 years and the two following years' budgets are allocated to tourism of this nature. As it is the case of tourism in general, the successful implementation of domestic tourism and domestic cultural tourism's growth strategy will require substantial financial resources. The current domestic tourism budget is, however, extremely limited and does not allow for the successful development of these sectors. Underspending on this key priority will undermine the aims of job creation as spelled out by the President at various occasions.

We have not yet fully realised the contribution of rural, cultural and indigenous tourism to the building of cohesive, caring and sustainable communities and national pride. By travelling at home, South Africans can contribute meaningfully to the tourism industry, its competitiveness and socioeconomic growth as well as job creation. We are very happy with the fact that we can see that the Minister is very busy launching the rural tourism. Also, we can see that ...

IsiXhosa:

... izinto ziyenzeka. Sinethemba kwaye sinqwenela ukubona abantu bethu bephuhliswa. Sifuna ukubona ukhenketho luziswa ukuhlaleni

I-ANC iyaluxhasa olu hlahlo lwabiwo-mali.Enkosi. [Kwaqhwatywa.]

The DEPUTY MINISTER OF TOURISM AZM MNGUNI ENG/ NTSHANTSHA ISIX/VM (Ed) / END OF TAKE

UNREVISED HANSARD

EPC COMMITTEE ROOM E249

Wednesday, 3 May 2012 Takes: 356 & 357


"Committee Room E249 Main",Unrevised Hansard,04 May 2012,"Take 356 [Committee Room E249 Main].doc"

Mrs X C MAKASI

THE DEPUTY MINISTER OF TOURISM: Chairperson, the international arena in which we operate harbours countless challenges which, in various ways, constitute threats but also opportunities for the creation of an environment conducive to the growth and development of tourism in South Africa. Nature's unpredictable changes, such as tsunamis and volcanic ash clouds, have, in a graphic way, demonstrated how the tourism sector can be vulnerable to these phenomena.

The persistent effects of the global financial crisis are dissipating far too slowly and this, with few exceptions, impacts negatively on tourist arrivals from our traditional source markets, particularly from Europe. Fortunately, we in South Africa have benefitted from the very positive branding and reputational spinoffs from the successful hosting of the 2010 Fifa Soccer World Cup. The implementation of the first ever National Tourism Sector Strategy entailed the setting up of delivery mechanisms, including a monitoring and evaluation framework, the allocation of roles and responsibilities, and support for integration of this strategy at provincial and local government levels. The 2012-13 financial year will see the first annual report on the implementation of this strategy.

The success of all our strategies depends on the capacity to implement. In this regard, local government was identified as the most critical link in the delivery chain for growth and development of tourism. In recognition of its role, the department developed a Local Government Tourism Intervention, Support and Capacitation programme, which aims to transfer the necessary skills to effectively support tourism planning and management at officials' level across municipalities, thereby preventing serial job hopping across the municipalities with limited capacity. It will create awareness on tourism for policy-makers to promote tourism-friendly policies, including municipal by-laws.

With Cabinet approval of the National Tourism Sector Strategy in March 2011, the department is focused on the development of plans to effect and support its implementation. These include the development of critical sector-wide frameworks, such as the crisis management framework, information management framework, service excellence framework and National Minimum Standards for Responsible Tourism.

In terms of the crisis management framework, the recent floods, which affected parts of the Limpopo and Mpumalanga provinces, particularly the iconic Kruger National Park, have demonstrated the vulnerability of our sector to natural disasters. The department has therefore put in place a crisis management framework which will enable the sector, working together with disaster management authorities, to effectively respond to such incidents so as to minimise the impact and speed up recovery in the affected areas.

In terms of information management, the department has developed a National Visitors Information Framework which provides for uniformity and standardisation across the information centres with regards to branding, operating hours, and classification, in other words, whether it is government-owned, private or a gateway. During the 2012-13 financial year, we will establish two national tourism information gateways, one at OR Tambo International Airport and the other at the Beitbridge Border Post. These information gateways will serve as one-stop shops for tourism information for visitors on arrival and will provide information about the entire country, not just their point of location. We will also establish a common brand for the visitor information centres across the country. The National Tourism Database is one of the most important sources of information for consumers, investors, policy-makers, operators, etc. Our understanding is that it is in the best interest of the entire sector to continuously maintain the integrity of our database. We would like commend the industry for its co-operation in our continuous efforts to maintain the database and trust that such co-operation will continue into the future, as we collectively manage this asset. It is for this reason that I am convinced that the sector deserves a light regulatory approach in this regard.

The gazetting of the National Minimum Standards for Responsible Tourism has provided clarity of expectation on how the tourism sector can become responsible. During this financial year, the department will work on an incentive framework to recognise good corporate citizenship. During the 2011-12 financial year, the universal accessibility declaration was adopted by the sector. In the coming financial year, we will focus our efforts on ascertaining the state of universal access in the country and establishing frameworks for a universal accessibility compliant town or city.

Turning to service excellence, the service excellence requirements, the first of its kind, developed through the South African Bureau of Standards as a national set of standards together with the service excellence campaign, were recently launched. The national Department of Tourism approved this strategy in April 2010, and it comprises of five pillars, namely research and information, up-skilling service delivery, public awareness, measuring and monitoring service standards, and consumer feedback systems. The aim of this five-pillared approach is to gradually introduce a service-orientated culture and to maintain it through various interventions in collaboration with the various institutions within the sector. The requirements are also aimed at improving and maintaining service levels at all service touch points in the tourism value chain. They are also aimed at guiding the sector to achieve the National Tourism Sector Strategy's objective of positioning South Africa as one of the top 20 global tourism destinations.

I will just touch on two aspects of skills development, the first one being the professionalisation of the tourist guides. Tourist guides are amongst the first and last contact persons for tourists. All 11 200 of our tourist guides are brand ambassadors and proudly wear their badges to serve the country with distinction. The National Registrar of Tourist Guides must work with the tourist guide fraternity to restore the dignity of this important profession. We also recognise that tourist guiding is an ideal entry point into the sector, particularly for previously disadvantaged groups; hence we will be pursuing a developmental approach to law enforcement and local community participation, particularly in areas that are rich with natural and historical resources. We shall also be creating awareness amongst consumers, product owners and aspirant tour guides to ensure that there is compliance with the law. Illegal guiding is not only a crime but could also destroy our brand, and it must be exposed and punished accordingly.

The second point I would like to touch on is the National Tourism Careers Expo, NTCE. This has been a very successful programme within the department and had been hosted in Durban during the last financial year with a record attendance of about 19 000 attendees. This programme was initiated in 2008, also as a response to the gaps identified in the 2007 Tourism Skills Audit.

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This is a forum where young people from high schools, Further Education and Training, FET, Colleges and universities are exposed to the existing professional and career opportunities that exist within the tourism sphere. This intervention is also prudent in exposing the tourism industry to a host of skills that exist amongst the young people of this country and, that which the industry could harness and benefit from. The department has since facilitated this to become an annual event, where interested and affected youths are exposed to industry opportunities. This year the National Tourism Careers Expo, NTCE, will be held in East London, in the Eastern Cape, from 28 to 30 September.

In conclusion, we are confident that this sector, which is identified as being one of the key priority sectors of our economy, is ready to contribute to the development of an inclusive and transformed economy. The decision taken is that transformation, as one of the key determinants of Economic Development and Growth in the sector, will be incorporated into the amended Tourism Bill, ensuring that macroeconomic policies of our country are incorporated.

I take this opportunity to thank the hon Minister Marthinus van Schalkwyk, for his insight and leadership of the department. My gratitude also goes to the former ambassador, Director-General Kingsley Makhubela and, the management team and staff in the department for their hard work and dedication; the Board of South African Tourism; and the CEO of South African Tourism; you are doing sterling work in promoting our country. Let me also give a thumb up to the tourism industry players for their contribution towards making Mzansi a tourist destination of choice; keep up the good work! My final word of thanks goes to the chairperson and members of the portfolio committee for their commitment, co-operation and guidance in their work. I thank you very much. [Applause.]

Mr L P KHOARAI / /Mia & ARM

UNREVISED HANSARD

EPC COMMITTEE ROOM E249

Wednesday, 3 May 2012 Take: 357


The DEPUTY MINISTER OF TOURISM

Mr L P KHOARAI: Hon Chairperson, Minister, Deputy Minister, Chairperson of the Portfolio Committee on Tourism, stakeholders of the Department of Tourism, ladies and gentlemen, comrades and friends, the department carried out a revamp of the three programmes and, it is important to highlight that such a task cannot be taken lightly. However, the department needs to catch up with global trends and we remain hopeful that this structure seeks to achieve exactly that.

I would also like to congratulate the department on the New Tourism Sector Strategy, NTSS, which had been approved by Cabinet in 2011, and the Draft Tourism Bill that has been published for public comment. These policies were also supported by the industry with their sole purpose being to address growth and development in the South Africa's tourism sector.

As we may all know that tourism is a cross-cutting sector, which requires the support of other government departments and the different spheres of government for it to be successful? It is thus important that intergovernmental relations be nurtured. It is for this reason that we commend the department on identifying some municipalities for the implementation of a pilot NTSS and, also the training of officials in these municipalities.

South Africa still has a lot to offer. However, it is for tourists to realise that it means packaging of our products needs to be done in a way that is directed by the demand of our target markets and, it is for this reason that through research on our target market and, competitors needs to be carried out. This will give South Africa the competitive urge we had prior the 2008 global crisis.

As the department, we would also like to express our delight with a plus minus 9% increase in German tourists, as it has been stated in research, and that there are a number of things that resulted in the increase and these things. The things include direct flights to South Africa offered by SAA and Lufthansa and other indirect flights airlift capacity having increased by 10%.

It is not to be left to chance to resolve issues with regard to the country's airlift strategy and rising landing costs that have led to tourists flying to Mozambique rather that O R Tambo Airport. We acknowledge that the Ministry is working towards luring tourists that visit Mozambique to also extend their visits to South Africa. However, at the same time, we should not lose what we have, rather gain more. This is where intergovernmental relations will become crucial.

I will also like to commend the department's role in resolving the issue of jet fuel that was going to result in a national crisis, not only for tourism but for trade relations and business investments. We hope that the department will continue to contribute positively towards the growth of our beautiful country, South Africa.

With the country facing a number of challenges regarding air travel, it would be interesting for niche products such as cruise tourism to be developed further in the country. There is currently a report on cruise tourism and it would be interesting if the department could work towards ensuring that there is development of that product. As we say, South Africa has a lot to offer indeed. With a number of ports along the coast of South Africa, this product has a lot of potential to prosper and bring on board tourists that will assist us in achieving our 2020 target of 15 million visitors and tourism contribution to job creation.

The department has indeed improved significantly from the previous year. The audit report has however raised a number of concerns regarding the Expanded Public Works Programme, and the steps taken to remedy the situation were commendable. We also believe that the coming annual report will prove that the department's internal control systems have improved.

Inasmuch as the department shows notable progress administratively, it has however budgeted about R29 million for consultants, and this is a point where it still needs to improve. We however, acknowledge that as compared to the previous years, the spending on consultants has improved. We believe the department will head the call to reduce spending on consultants and channel resources to hiring expertise in the required fields. If relevant people are hired for these posts, the progress of the department will improve drastically.

The department has also made notable progress with regard to the implementation of the performance management development system. Furthermore, the control system in the department seems to have recovered following the doubt that was casted by the distribution of funds on the EPWP.

It is for this reason that I move to support the budget of the Department of Tourism and believe that the department will continue to follow government policies and procedures, especially the Public Funds Management Act and Treasury regulations. Thank you. [Applause.]

Mr S N SWART / ARM / END OF TAKE

UNREVISED HANSARD

EPC COMMITTEE ROOM E249

Wednesday, 3 May 2012 Take: 358


Mr L P KHOARAI

Mr S N SWART: Chairperson, hon Minister, the ACDP welcomes yesterday's launch of the new domestic tourism growth strategy which includes SA tourism's new domestic marketing campaign under the tagline, "Whatever you are looking for is right here in South Africa".

We know domestic tourism contributed 76% of South Africa's total volume in 2 011 and contributed R20 billion to the country's economy which made a substantial contribution to creating and sustaining much needed jobs.

We thus support the call for the South Africans to be tourists in their own country and to experience what millions of international tourists are drawn to annually, the sheer beauty of the land, its rich culture and heritage, the warmth and hospitality of its citizens.

Minister, you are quite correct in saying that many people only dream about coming to South Africa, yet our citizens are not taking full advantage of travelling and enjoying the many varied and beautiful attractions in our country and we trust that yesterday's initiative will address this.

As far as foreign tourist are concerned, last year a record number of 8 million foreign visitors arrived in the country more than those who came during the Fifa soccer World Cup. There is, however, a view among industry stakeholders that South Africa has failed to implement a fully effective and integrated marketing strategy with private sector associations, national, provincial regional and municipal tourism organisations vying with each other to have their voices heard.

Hon Minister, to what degree has the national tourism sector strategy announced last year ensured a national focus and integration and alignment of efforts by all involved in the tourism industry to address this view that is held by certain stakeholders.

The question also arises whether sharply rising hospitality costs in South Africa refer to by various speakers have been a disincentive to visit the country with a perception being that the country is no longer a cheap destination. The rand's general strengthening has also been a disadvantage to foreign tourists and of course one can consider the costs of air travel and how does one keep these costs down considering that South Africa is a long haul destination and that airline costs are dependent on the oil price.

We do, however, share your concerns about the EU's common tax on airlines flying in and out of Europe. On the positive side, there is a signifant rise in Indian and Chinese visitors that is to be welcomed and encouraged. It does, however, appear to be a challenge with Home Affairs when it comes to distinguish between legitimate Chinese tourists and potential illegal immigrants and this has to be addressed.

A competitive tourism industry is vital to realise the objective of increasing the number of visitors to 15 million by 2020 and the ACDP is fully behind all efforts to achieve that goal. We will support this Budget Vote and wishes to thank all the officials in this department for their handwork and commitment, and well done in the unqualified audit. I thank you.

Ms R M M LESOMA

UNREVISED HANSARD

EPC COMMITTEE ROOM E249

Wednesday, 3 May 2012 Take: 358


Mr S N SWART

Ms R M M LESOMA: Chairperson, Minister of Tourism, Deputy Minister of Tourism, hon members, ladies and gentlemen, we are humbled an honoured to be able to participate in the tourism Budget 2012-13 Vote 35 debate.

As people of South Africa celebrate the existence of the mighty majority party ANC, credit should be given to all those who contributed positively, one way or the other, all living in it as we enjoy democratic freedom today.

Doors of opportunities and ultimate towards prospects for more equitable growth have been opened through the transformation of tourism which has arrived for the people of South Africa. Tourism is the people, so say our Minister. Allow me to add that tourism is good heritage, tourism is the landmark and tourism is the history that you can see and feel.

I am not too sure whether we should be worried about the key perception areas such as crime, underdeveloped rural areas and youth unemployment which, in summary, are the areas which the country seems to be worried about. If we can venture in tourism which does not necessary need specialised skills and capacity without lowering any standards. Whether it is linked to the lack of job opportunities or expected investments in those areas, I am not too sure.

Sukumani sakhe, doing things with our people not doing things for our people. Our President's state of the nation address directed all departments to improve their turnaround time in paying service providers within 30 days which is mainly black emerging service providers. Let us walk the talk in supporting emerging small tourism businesses.

We are encouraged that our government have put rural development on top of the agenda. A meaningful amount of money have been allocated towards infrastructure development which will change the state of rural roads, rails and information infrastructure drastically and in return increase international and domestic tourists visiting mountains and our historical nodes and sites.

Interdepartmental, intergovernmental and local government relations partnership can improve tourism as a country as other members have alluded. Local government on matters such zoning and rezoning bylaws should be geared to encourage the growth of hospitality industry, especially, if we want to see meaningful transformation of tourism in this country. However, the Department of Tourism should remain the custodian of such programme.

Not very long ago European Embassy held a workshop where they invited SA Tourism, SAT, and the department to present our South African strategy to be linked with their offices. Maybe we should look on expanding the gesture to other embassies. This will ensure South Africa's international integrated tourism approach is realised. Collaboration integrated and joint calendars of domestic or international road shows will ensure South Africa as a preferred destination.

We welcome the launch of rural tourism development programme by our hon Minister at Cederberg Municipality as other members have captured very well.

Chairperson, the department has performed quite well. However, we still have to pay much attention in empowering the tourism sector financially, training and mentoring to ensure change and transformation of tourism in South Africa. Maybe tourism incubators might be the route to take.

Tourism enterprises programme has good intention, though we seem to be receiving mixed feedback from the ground. Is it as effective as expected? Our learning institutions should be encouraged to embark on study tours programmes to increase future domestic tourists who are proud and rich with the appreciation of historical nodes and sites of our country.

Geographical balance of conference space use must be promoted and actioned by government or championed by government departments at a first instance to ease the burden of congested big cities with those programmes or activities.

Moving forward, would it be better if grants and loans be handled by Department of Tourism closely in ensuring faster transformation? South Africa's results on tourism and migration in January 2012 indicated that volumes of arrivals have increased by 1, 4% for the year December 2011 to January 2012. However, departure volumes have fairly declined. Since March 2011 to March 2012 there has been a gain noticeable increase of 6% of international arrivals excluding domestic tourism, which is a good sign of value for money invested on international marketing by SAT, notwithstanding the recession as the deputy Minister have alluded to that.

As a developing country it is quite a meaningful achievement compared to other international countries which has not managed to be above 3% on aggregate. New partners bring new markets. Previously, we have been focusing mainly on Europe and USA. Currently, with our new BRIC's arrangement we have gradually made inroads further more in Africa which is one of the fastest growing areas in tourism, which will encourage and also change the face and the landscape of tourism in our country.

Chairperson, the department's policy and strategy development framework is embedded on transformation which is the key of my input today. I would like to pose some few questions to the House. Is there monopoly in travelling agencies? Who does travelling packages? Should the government not ring fences around tourism services to ensure transformation and experience credibility of small emerging agencies? Should the government encourage joint ventures of big and small tourism establishments? Should the twinning of well established hotel industries with the Bed and Breakfast, B&B, in particular, owned by the blacks be aggressively encouraged?

As the ANC we would like to support and move once more the support of the approval of the budget.

IsiZulu:

Sihlalo, sengizohlala phansi, masizibongele ngethuba enisiphe lona ekuqinisekeni ukuthi kuba khona izinguquko ezibambekayo kwezokuvakasha nokungcebeleka kule lizwe laseNingizimu Afrika.

Tourism is the people, transformation is about the changing the landscape of South African tourism. I thank you.

Mrs J M MALULEKE // IsiZ. (NPM)// Engl. MM / END OF TAKE

UNREVISED HANSARD

EPC COMMITTEE ROOM E249

Wednesday, 3 May 2012 Take: 359


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R M M LESOMA

Ms J M MALULEKE: Chairperson, let me acknowledge the support from my friend, Christine Mohale, the convener of North West Women's League and that of my colleagues from North West. Hon Chairperson, hon Minister, hon Deputy Minister, hon chairperson of the portfolio committee, Members of Parliament, stakeholders of the Department of Tourism, ladies and gentlemen, I would like to start by acknowledging the progress made by the department in doing the analysis of the previous structure and ensuring that things that need urgent attention are flagged out.

The road to success requires one to evaluate past occurrences which include successes, failures and areas of intervention. It is also pleasing that these steps were undertaken in the earlier stages as this will go a long way in ensuring that a strong foundation is erected and also that government priorities are met. The role that used to be played by the tourism in the country as identified in the Industrial Action Plan 2 is crucial and cannot be overlooked. This is why in the near future constant monitoring and evaluation of these changes need to be undertaken.

In light of the new trends that have developed due to the number of global instabilities, visitor patterns have evolved and it is only through conducting research and development of country profiles that we as South Africans can benefit from these shifts. These country's profiles should be superseded by profiles that we already know based on our marketing strategies and identification of core markets.

It is also important that we capitalise on our bilateral and multilateral co-operations such as Brazil, India, China and South Africa, Brics, as well as Africa's emerging markets.

Statistics on arrival figures has shown significant growth with regards to our emerging markets such as China and India. However, the growth experienced in terms of our European markets has stagnated. This however, does not mean that there is a decline of visitors from that region. This information brings a sign of relief because it means that even though we have limitations such as low marketing budget, long haul flights and so on as compared to our competitors we are still able to experience positive growth.

I have mentioned above that the lessons that we have already gathered through South African tourism should not be watered down but should be incorporated into strategic policy directives that will guide approaches towards the international markets.

International platforms such as the United Nations World Tourism Organisation and World Travel and Tourism Council are very important in the growth and the development of tourism in the country. It requires the custodian, which is the Department of Tourism, to develop strategies that will allow the country to leverage positive fruits from them. It is also important to note that it is through these forums that we are able to influence decisions with regards to aviation, taxes on international travel, climate change and security risks. It is for this reason as well that I would like to acknowledge the role that is played by the department in these forums.

It is also important that we note and appreciate the work done by the Department of Tourism and Department of International Relations and Co-operation, Dirco, in coming up with a strategy that acknowledges the overlapping roles between national Department of Tourism, Dirco and the Department of Trade and Industry, DTI, and in order for the department to effectively contribute towards the Fourth Parliament's priority of decent jobs and sustainable livelihoods, cohesion needs to be fostered. This should also be the case for the international tourism programme with the role played by South African tourism. As the committee we will continue to flag out any issues of concern that will keep the department focused on achieving these priorities.

The department has been productive in the past year with an exception of some challenges here and there. However, there is a hope for change with the new tools that have been developed. These include the new structure, new Tourism Bill that is still to be passed and the new platforms created such as the National Convention Bureau.

Currently, the other challenges that affect international tourism growth include issues such as insufficient market insight, inadequate strategic approaches, global economic recession, insufficient air access, the nonimplementation of international agreements and monitoring thereof. These above mentioned shortcomings will have to be approached in this financial year and through proper co-ordination with the relevant stakeholders the department should be able to make positive contribution towards international tourism growth and development thus increasing tourisms contribution's to thegross domestic product, GDP, and ultimately the country's job creation agenda.

Xitsonga:

Mutshamaxitulu, handle ko heta nkarhi wa njhekanjhekisano, eka masikunyana lama hundzeke ha ha ku heta ku tlangela Siku ra Ntshuxeko. Van'wana va vula leswaku a va swi voni leswaku demokirasi yi tisile yini. Hina ha swi vona eka vupfhumba bya matiko hinkwawo. Vanhu va kota ku kuma mapasi yo endza va huma va ya ematikweni man'wana. Khale a va nga koti ku suka laha va tshamaka kona va ya hambi ekusuhi, xikombiso, kwala Pitori. Leswi hi swin'wana swa leswi hi kombaka leswaku xidemokirasi xi kona laha Afrika-Dzonga.

Namuntlha hi tshamile laha hi katsanile ni valungu lava van'wana va humaka ematikweni ya le handle hambileswi va titsariseke leswaku i vaakatiko va Afrika-Dzonga. Leswi hi swin'wana swa leswi hi kombaka leswaku hi na ntumbuluko lowu hi endlaka hi va vanhu va Afrika-Dzonga.

English:

Hon Chairperson, with those words I would like to move for the support of the budget of the department and hope that the department's progress in the aforementioned challenges will advocate further for budgetary increases. Thank you, Chair. [Applause.]

Mr M R SAYEDALI SHAH

UNREVISED HANSARD

EPC COMMITTEE ROOM E249

Wednesday, 3 May 2012 Takes: 359 & 360


Ms J M MALULEKE

Mr M R SAYEDALI SHAH: Hon Chairperson, hon Ministers, hon members, ladies and gentlemen, ours is an awesome country. We live in one of the most beautiful lands on planet earth. We are blessed and endowed by nature with enviable gifts like a rich biodiversity, valuable natural resources, a vast array of plant and animal species, rivers, lakes, oceans with sunny beaches, towering mountains and a thriving multicultural, multiethnic, pluralistic society to add colour to all of these.

Historically speaking, we are the custodians of the cradle of civilisation, and more recently, the architects of a political legacy second to none when we arrive at the rainbow nation in 1994.

Hon Chairperson and members, these are our priceless assets, yet South Africa has a meagre market share of just about 1% of the almost US$1 trillion foreign tourism markets. I'm not saying this is an indignant in your department, hon Minister.

It is not ironic, relatively speaking, that tiny little island nation states like Mauritius and others like the Maldives consisting of hundreds of little atolls, have managed to continuously capture the imagination of the global tourists. Compare what we have as compared to what they have to offer in terms of places of tourist interest, etc. Yet, they manage to sustain their little respective economies primarily driven by their tourism industry, which is no mean feat.

We need to ask ourselves and we must ask, what is it that they are doing right and we are not. In spite of all our strengths that I've just explained, why are we in danger of lagging behind in the global tourism market? These are critical questions, answers to which may assist us in seeking solutions to the numerous challenges we face in a highly competitive global tourism market. They will also guide us in the formulation of plans and enabling legislation and policy for the growth and promotion of tourism in our beautiful country.

Chairperson, it is my considered opinion that answers to these questions that I pose will, amongst others, surely include the following three things. I say this again and I emphasise, not as an indictment on your department, but on the industry and the tourism sector. One, service excellence and work ethics; two, appropriate skills and capacity; and three, very importantly, an appropriate budget accompanied by unwavering political support. That is what we are lacking. A cursory glance at our tourism sector will unveil a deficit of all three enumerated factors.

The United Nations World Tourism Organisation predicts that more than 1 billion people will travel to other countries this year alone. We must capture and harness this great opportunity to create much needed jobs in a growth market the World Tourism Organisation estimates will reach approximately 1,8 billion international travellers by 2013.

Given the fact that tourism is considered to be one of the key economic drivers in helping to reduce unemployment and poverty in our country, we must not, and simply cannot, afford to miss this boat, if we are to meet our National Tourism Sector Strategy targets which are set in line with the New Growth Path vision, which expects this department and the tourism sector to create 225 000 jobs by 2020. As well as to increase the sector's contribution to the national GDP from an estimated R189,4 billion in 2009 to R499 billion by the year 2020.

The DA considers the tourism sector, being the fastest growing sector in South Africa, as having the greatest potential to create job opportunities for our youth, many of whom are unemployed today; to empower them by giving them the necessary skills, experience and the required confidence for future employment. However, this will require collective effort and, as my colleagues from the committee have also emphasised, greater synergy and co-operation among the various relevant government departments, especially the Departments of Home Affairs, International Relations and Co-operation, Trade and Industry, Basic and Higher Education, etc., as well as very meaningful support from the private sector.

First and foremost, it is important that we do both - and I draw your attention to this, Minister, I'm new to this portfolio, you may have done so, I don't know - an internal skills audit of the Department of Tourism itself, as well as skills audits across the tourism sector in general. We must do this in order to identify the existing skills gaps. The fact that we have a capacity problem and skills gaps within the department is evident from the fact that we have dedicated almost, if I may say, R29 billion of the budget programme towards meeting the expenses of consultants.

The information gleaned from such a skills audit may then be communicated to the Departments of Basic and Higher Education for inclusion into their curriculum designs and admission policy processes to be offered as subjects to be seriously adopted at school and at tertiary level, as well as to feed into the Further Education and Training colleges. I believe that it is currently offered as an undesignated subject at high schools. For me, this is an indication that this is not taken seriously enough.

We must capture the imagination and direct the attention and interest of these young minds towards tourism, in general, and towards the industry, in particular, as some of my colleagues have said. We must inform them of the various programmes. It's no use having these programmes, but do they know that they can access them? That is the question. So, we must inform them of the various programmes being offered by the department for their benefit. Programmes like the National Youth Chefs Training Programme, the National Tourism Careers Expo and the Hospitality Youth Initiative, all of which are designed to contribute to skills development and job creation.

In conclusion, the success of our tourism industry will depend on the continuous availability of well-skilled, well-trained, well-mannered, proudly South African men and women with a real passion for service excellence at every level – from the top to middle management level, right down to the ordinary worker in the sector. This must be achieved, if we are to attract more people to visit our beautiful country. This can be achieved if government puts its money where its mouth is. This can be achieved if all stakeholders come to the table. Thank you. [Applause.]

Mr F BHENGU / /NN / GC & UNH/ END OF TAKE


UNREVISED HANSARD

EPC COMMITTEE ROOM E249

Wednesday, 3 May 2012 Takes: 360 & 361


Mr M R SAYEDALI SHAH

Mr F BHENGU: Chairperson, Minister, Deputy Minister...

IsiXhosa:

...MaRhadebe, nisebenzile, nkosikazi. I-ANC, ngolwimi lwesiXhosa, iyalwamkela olu hlalo-lwabiwo-mali lwalo nyaka, nemigaqo-nkqubo ethiwe thaca leli sebe kulo nyaka-mali. Silwamkela sikhwina, kodwa loo nto ayithi masingazami ukuqoqosha, sikusebenzise ngononophelo esinako silisebe.

English:

Frugal measures and austerity dictate under the prevailing global economic turbulence. Having appraised the constructive and invaluable articulations by my colleagues and observations made by the hons Mam' uNjobe, Shah, Farrow, Mam' uZikalala, and Mr Swart, there's nothing much that one can say, save to say their inputs are salient and pertinent.

IsiXhosa:

Ndifuna ukubhekisa kuwe sihlalo. Ndineenyangana nje ezimbini okanye ezintathu ndikule komiti ijongene neli sebe,...

English:

... but something that I truly appreciate is the co-operation that has been spearheaded by your leadership skills in putting us together, so that we see with one eye and hear with one ear.

We have been in this long journey together. Nineteen-ninety-four brought about liberation to all South Africans, black and white, we were all there. The ANC, as a liberation movement, not only fought for black people, but for all nationalities, including whites, even those who espoused apartheid as a sanctimonious god-approved tool of dominance and oppression.

The question today is, have our national policies and programmes addressed the prejudices and socioeconomic imbalances of the past? Haven't our imaginary insecurities bred despondency and defence mechanisms that tend to reinvent racism and tendencies of ethnical, sectoral, economic and social self-exclusion?

In so doing, they systematically and deviously used the very laws and policies of liberation to reincarnate the tribulations and evils of the past.

Intolerance amongst South Africans and restiveness amongst the youth are concerns. It would be an indictment on us here present, if we do not arrest this nemesis. The President, in his state of the nation address, laid the foundation. In response the Minister and the department tabled before us their strategic plan and tools of trade. It is for us to monitor and oversee the inputs and the outcomes of the implementation thereof.

The White Paper on Tourism highlights reconciliation, socioeconomic empowerment and equity, as espoused by the ANC, further engrained in our Constitution and piloted by comrade Mandela in our first Parliament. Minister, we spoke about this when we came in here. We then ask: Where are we coming from and where are we going to? This then begs the question: Where do we place tourism in all of this?

Tourism and the budget before us is the fundamental instrument in advancing our constitutional imperatives, as defined by our White Paper on Tourism, the Tourism Act, policies and regulations.

These, together with the National Development Plan, the Industrial Policy Action Plan, the New Growth Path, the Tourism Sector Charter and the National Tourism Sector Strategy, in particular, bind us to co-operate, integrate and tirelessly work in tandem with provinces, local municipalities, communities and stakeholders to achieve all these objectives. Are we there yet?

The positive audit report defines the department's commitment in performing its mandate to the core. Minister, I always say that self-praise is no recommendation, but at times we have to commend the department for that.

The Department's strategic business plan highlights the key obligations and commitments in achieving the intended projections and outcomes, as prescribed and advocated by the White Paper. Let's go back to the White Paper, because it is the key foundation. I am not praising you, Minister. When I looked at your business plan, I was quite impressed to see that each and everything that is contained in the White Paper, is in your business plan. [Applause.]

Correlating the adjustments made and budget allocation for the policy and knowledge services programme, is where the chairperson has instructed me to respond. Mrs Njobe, I have found that all members have talked accurately. Mr Sayedali Shah, I demand your attention, you have also raised issues. What is critical and so exciting is to find that, as much as members are critiquing, they are also coming up with proposals for us to look into. I want to single out the members of the opposition parties and then say that I don't see you doing it because you are being driven by your political affiliations, but just because you are South Africans and you know where we come from. [Applause.]

Minister, under the particular programme that I was supposed to talk about, I have seen each and every activity that the department has committed itself to do and its timeframes set. As a committee we appreciate that. Somewhere you indicated that 2014 will be the date, but the portfolio committee would request that we also receive interim reports in between so we can move in tandem and step bystep, rather than to wait until then.

Minister and Deputy Minister, I stand to commend you and your department for the work done. We are encouraged that you continuously uphold the principles of inclusivity, emphasizing what the Tourism White Paper dictates and that tourism must be people-driven

You are working with the people instead of working for the people. Further, you are adhering to the clarion call that says: Nothing about us without us. To your staff, individually, we commend your work ethics. Continue being exemplary and adhere to the Batho Pele principle in upholding the image of our government.

Hon Gumede, having served under your guidance in the last few weeks, I may without hesitation say, your leadership is impeccable. [Applause.] The ANC supports this budget vote. I thank you.

The MINISTER OF TOURISM (Mr M C J van Schalkwyk)/ UNH & src

UNREVISED HANSARD

EPC COMMITTEE ROOM E249

Wednesday, 3 May 2012 Takes: 361 & 362


Mr F BHENGU

The MINISTER OF TOURISM: Chairperson, I would like thank all the hon members who participated in the debate for their comments, suggestions, and positive and constructive criticism, where hon members did that.

I am quite sure that hon members will fully appreciate that it is impossible, in the space of 10 or 12 minutes, to deal with all the issues raised. I will deal with as many of them as I can. I will try to group them together. Some of the issues raised, we will take note of. Some of them, obviously, we will further discuss in the portfolio committee. I would like to thank all the hon colleagues and I will deal with as many of the issues raised as I can.

I would like to start off with the issue raised by the hon Manjobe on domestic tourism and link that up with the question asked by the hon chairperson and hon Farrow. She raised the issue of whether we should not have a unit, separate from South Africa tourism to deal with domestic tourism. The two questions asked - I am paraphrasing now - were basically: Did we get the full value of the money that we have spent?

In my personal view, we are not at a place yet where we can talk about a separate unit responsible for domestic tourism. In my view South African tourism is fully empowered, well structured, well budgeted and well financed to deal with domestic tourism as well. To suddenly have another structure that we have to fund with new staff, new offices, etc, at this stage, is not yet what we should do.

What the hon member raised is an issue that we should not run away from. I would like to really confront this issue and not run away from it. The issue basically is: How do all of us, national government, provincial governments and local governments, spend our money? Let me ask the question straightforwardly: Should provinces and local governments spend their money on international marketing? That is the question that all of us should answer if we are in the National Assemble or in the NCOP or provincial legislatures.

There is aconstitutional problem and constitutionally tourism is a concurrent power. Every time we discuss this issue with our colleagues in the provinces, some of them, not all of them, would actually say: Please stop there, it is a concurrent power, we want to market our province internationally. Some would support our emerging view on this issue.

I think as national government and Parliament, we have to seriously engage our colleagues in the other two spheres of government to ask them: Don't you think it will be much more worthwhile if you spend your money on domestic marketing, so that we can ensure proper competition in the domestic market. Honestly, I think that is the first stage that we should discuss with our colleagues in the other two spheres of government.

The hon chairperson asked the question. He actually mentioned some examples where he thought we should have done better. One of them that he mentioned was small business development. Apart from the Tourism Enterprises Partnership, TEP, I have dealt with that in the initial introductory speech, is also the function that we are now transferring from DTI to our department – the incentives programme. We are in the process of transferring that function to us. It will be an additional R400 million that we will be able to invest in Small Medium and Micro Enterprises, SMMEs.

Let me just deal with international marketing. The hon Maluleka raised this. She is absolutely correct. We should be very careful when we look at new emerging markets versus our traditional markets.

"Committee Room E249 Main",Unrevised Hansard,10 May 2012,"Take 362 [Committee Room E249 Main].doc"

We should be very careful when we look at new emerging markets versus our traditional markets. Everybody in the world understands that the numbers in the future will becoming from the emerging markets – China, India and the few others. But it will be a major mistake if we start ignoring our traditional markets.

One of the reasons why we outcompeting our direct competitors is because some of our competitors in my humbly view have made that mistake, but it is good news to us. So we would like them to continue to make that mistake. The developed countries have taken almost all their monies out of the traditional markets and put them in a new emerging market. We have opted for a more balanced approached where we wanted to put new money into the emerging markets. So, that is what we are doing for a very long time at the moment. Although numbers in the emerging markets will grow by leaps and bounds, the spend per capita will still be in the traditional markets. Let us not forget that.

Let us also understand that on our doorstep there is another reality that nobody has actually mentioned that no longer is the highest spend of per capita in our country, American tourist, but Angolan tourist. So, the African continent should not only be underestimated, it should be fully appreciated for what it is.

With regard to South African tourism, the term of office of the present board will expire on the end of May this year and the new board will take over from 1 June 2012. I would like to use this opportunity to thank the outgoing board even if we will still have a separate function where we would thank them. Let me say to the honourable colleagues here that they have been an excellent board if not thee best board that we have for a parastatal.

Mr Jabu Mabuza after six years as chairperson for two terms - but he has been in the board for a longer time than that - he will be stepping down, and Mr Frank Kilbourne who was his deputy chairperson, will now take over as chairperson. Mr Zweli Mntambo who was a chairperson of the audit committee will become the new deputy chairperson of the SA Tourism Board.

Then, colleagues, in different ways, we referred to the cost drivers in our department. What are those cost drivers? They are many more, but I would like to quickly reflect on three: The cost of flying; the cost of accommodation; and taxes - departure taxes, especial the UK and the new so-called green taxes that I referred as the EU ETS.

Just in terms of the cost of flying, if we compare, in real terms, what happen in our country over the last 10 to 15 years, it is actually a wonderful success story. In real terms, it is much cheaper to fly now than it was in 10 or 15 years ago. There is only one reason for that, and it is an increasing competition. As the government, we say stop the over protection and ensure competition. We did that in the domestic market. But colleagues, we are not at the end of the process. I know some people get over sensitive when I say this.

We must continue to increase competition in South Africa, domestically, on certain routes. Why should it be more expensive to fly Cape Town to Kimberly than flying to London? Obviously, it has to do with the size of the market and the maturity of the market. But we must look at ways of ensuring competition on all of our domestic and international routes.

In 2005, we had 26 airlines flying to South Africa, and now there are around 50 airlines flying to and from South Africa. Then look at what happened to prices internationally. For us, it is a long haul destination – good news. But on some of those routes, because of the lack of competition and obviously because we are with a long haul destination, we need better pricing structures.

As I have said, we are working with transport, finalising the new airlift strategy and will take that to Cabinet when it is ready so that we make sure that all of the stakeholders are on the same hymn sheet and that some of them would not like to block a more open approach and more competition in this regard.

On the issue of accommodation, hon Farrow referred to what he though it maybe overpricing. Let me just say, in this regard, there are no overpricing as a general trend in South Africa. I will refer the hon member to the Graham Fulton report 2010, which concluded quite convincingly that it is not a general problem in South Africa. The few exceptions and the agreement with the tourism business council was that they should deal about that. I know that there are some people who are asking whether the government should intervene here or not. Now, colleagues, if the government starts to intervene in price controls and curbing of prices, it is a wrong approach.

Therefore when there are problems of overpricing, I and you as Members of Parliament should shine the light on that. We should sit down with the private sector to ensure that they deal with that. But that's the way of doing it.

I am very confident that as the destination we are firmly within the brackets of value for money destination. We are not a cheap destination, but we are value for money destination, and it was a conscious decision to position ourselves there. Some of our competitors change their status from marketing themselves as the cheap destination long away before they were value for money destinations, and it not working for them. So, the challenge is to continue to be where we are as the value for money destination.

But let us also be honest, there was accommodation increase here during the World Cup year by almost 20% in the country. We can't criticise the private sector that were responsible for building those hotels, those are long-term decisions. They probably took some of those decisions three, five or ten years ago, and when the economic slowdown happens none of us foresaw that. The reality is that as a sector we have to deal with it and slowly we are catching up. I just saw a report this morning from the Western Cape Fedhasa that Western Cape had the biggest challenge to deal with the oversupply of accommodation, even if the accommodation people don't want us to say that; and the increase in supply, but they are catching up. We are almost there so to can deal with this.

When we deal with this issue, we must look at the whole picture. Yes, we have an increase in accommodation prices. But I would like to say to the hon member Farrow that the serious discussion that we need in this country, with local government, is to find decisions to be taken on factors impacting those prices. Let me mention just two example, local rates and taxes are on all business establishments, but business in our sector has a huge effect and obviously there must be a way in which those businesses mentioned have to factor in those increases. The electricity prices also have a huge impact on what is happening in the accommodation sector. So, let us have a holistic discussion so that we don't just blame the other party; instead, let us try to find a solution here.

Then the hon member Swart asked the question relating to budget and political support, like other members. Colleagues, let us be honest. We are not yet where we want to be, but we now have a standalone department that we did not have it in three years ago. We are now one of the six pillars in the national growth plan. Tourism never was in any national growth plan of this government. Just to look at what happened yesterday when our President meet the Indian president, he dealt with two issues, and one of them was tourism. So, in my view it's much more political support for us.

Let us deal with the budget. Now, the last thing that I want and should do is the Minister to come and say to you that he does not have enough money.

The HOUSE CHAIRPERSON (Mr C T Frolick): Hon Minister, you are addressing a very important item, but time is not on your side.

The MINISTER OF TOURISM (Mr M C J van Schalkwyk): Thank you, House Chairperson. Can I just conclude?

The HOUSE CHAIRPERSON (Mr C T Frolick): Just try to conclude.

The MINISTER OF TOURISM (Mr M C J van Schalkwyk): It would be wrong as part of any collective responsibility to say that because once a budget is approved we all take collective responsibility. Yes, our budget percentage wise is smaller than those of our competitors, but we are outperforming them because they don't have the social needs and challenges that we have. We will continue fighting for a bigger budget and make a deal with the Members of Parliament. You have new budget repowers now. So, please if I use mine and you use yours maybe we can have the budget where all of us stay collective responsibility for. So, thank you very much. [Laughter.] [Applause.]

Debate concluded.

The Committee rose at 16:14.

src & VM/ / END OF TAKE


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