Hansard: NCOP: Debate on the State-of-the-nation Address

House: National Council of Provinces

Date of Meeting: 17 Feb 2014

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Minutes

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TUESDAY, 18 FEBRUARY 2014

PROCEEDINGS OF THE NATIONAL COUNCIL OF PROVINCES

________

The Council met at 14:00.

The Chairperson took the Chair and requested members to observe a moment of silence for prayers or meditation.

ANNOUNCEMENT

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Start of day

APPOINTMENT OF NEW MEMBER TO THE NCOP

(Announcement)

The CHAIRPERSON OF THE NCOP: Hon members, I would like to announce to you the appointment of hon H S Boshoff owing to the resignation of hon Manzini. I take this opportunity to welcome the hon member and wish her well as a member of the National Council of Provinces.

NOTICES OF MOTION

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ANNOUNCEMENT

Mr T M H MOFOKENG: Chairperson, I hereby give notice that on the next sitting day of the Council I shall move:

That the Council-

(1)notes with utmost concern the images taken by the French press agency, AFP, photographer, Marco Longari, showing young people wearing red berets on the back of a van branded with the name of a novice political party of disgruntled people led by people who were fired by the ANC for ill discipline, off-loading tyres to be burnt during a violent protest in Hebron near Pretoria;

(2)acknowledges that these images further prove the public's concern that many of the public protests experienced in our country lately are largely not about service delivery concerns but are fuelled by people who intend to create the perception that there is a service delivery crisis; and

(3)takes this opportunity to condemn in the harshest possible terms any attempt by individuals to mobilise and bully communities to engage in public protest and burn public property.

Mr D A WORTH

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Mr T M H MOFOKENG

Mr D A WORTH: Hon Chairperson, I hereby give notice that on the next sitting day of the Council I shall move on behalf of the DA:

That the Council-

(1)notes that water supply to Bloemfontein in the Mangaung Metro in the Free State have been disrupted over the past few months;

(2)also notes that the Manguang Metro stated that two sluice gates at Mockes Dam had been blocked by debris and mud, tree branches and large stones restricting the amount of water that could flow into the Mazelspoort Weir;

(3)further notes that the ageing water infrastructure and lack of maintenance with regard to water pumps and purification systems need urgent attention; and

(4)acknowledges that the city needs a long-term solution such as a pipeline that will bring water from the Gariep Dam or the Katse Dam in Lesotho which, although a costly exercise, is the only solution over the long term.

Mr M W MAKHUBELA

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Mr D A WORTH

Mr M W MAKHUBELA: Chairperson, I have forgotten my note. The one I have now is the wrong one.

Mr F ADAMS

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Mr M W MAKHUBELA

Mr F ADAMS: Chairperson, I hereby give notice that on the next sitting day of the Council I shall move:

That the Council-

(1)notes with concern the false and misleading claims by the DA on social media platforms and in public statements that DA municipalities had created 31 000 job opportunities in the past year and that the City of Cape Town delivers more to poor residents than any other city;

(2)further notes, however, that the website Africa Check, a reliable and reputable organisation that investigates claims by politicians and checks them against the facts, found that the DA could not back up its claim, while a senior DA spokesperson admitted to having been unable to track down sources to back up the claims and that, in fact, there is no one who can give any concrete information;

(3)also notes that there is a clear, systemic deficiency of information management in the DA;

(4)further notes that this reveals the political bankruptcy of the DA and the extent to which the DA is prepared to blatantly mislead and lie to the public in its desperation for votes; and

(5)takes this opportunity to call on the DA to become politically mature, to stop its cheap political engineering and its lust for publicity, to take the public in its confidence and inform them of the true facts.

Mr T E CHAANE

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Mr F ADAMS

Mr T E CHAANE: Chairperson, I hereby give notice that on the next sitting day of the Council I shall move:

That the Council-

(1)notes with shock and concern the report by the Auditor-General, revealing that the Western Cape had spent an exorbitant amount of R10,3 billion on consultants over a period of three years from 2008 to 2011;

(2)also notes attempts by the DA to put a different spin on the finding of the Auditor-General by attempting:

(a) firstly, to shift the blame to the ANC, when, in fact, it was in control of the Western Cape for two of the three years in question; and

(b) secondly, through its leader, Helen Zille, to not only soften and disguise the DA's failure and its spending on consultants but also to blame the Auditor-General by criticising his definition of consultants – as if the definition jeopardises her province – while losing sight of the fact that the same definition applies to all provinces and, in fact, to all spheres of governments;

(3)acknowledges that this spending by the Western Cape is the highest of all provinces; and

(4)calls on the DA to take responsibility for its exorbitant use of consultants and the shocking spending in that regard and to stop looking for excuses or for someone else to blame for its failures.

MOTIONS WITHOUT NOTICE:

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NOTICES OF MOTION

ANNOUNCEMENT OF FOR ELECTION DATE BY PRESIDENT

(Draft Resolution)

Ms B V MNCUBE: I hereby move without notice:

That the Council-

(1)notes that His Excellency President Jacob Zuma, has announced 7 May 2014 as the date for national and provincial elections;

(2)takes this opportunity to thank all South Africans who have registered to vote; and

(3)also appreciates all the ANC volunteers who continue to work selflessly to preach the message of hope encourages them to continue in their national task to work together to move South Africa forward.

The CHAIRPERSON OF THE NCOP: Is there any objection? There is an objection. In the light of the objection, the motion may not be proceeded with. The motion without notice will now become a notice of a motion.

Mr B NESI

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Ms B V MNCUBE

CONVICTION OF CRIMINALS FOR KILLING POLICE CONSTABLE

(Draft Resolution)

Mr B NESI: Hon Chair, I move without notice:

That the Council-

(1)notes the conviction of five heartless criminals for brutally killing Const Xolisa Banga while she was on her way to the Philippi Police Station in March 2012;

(2)further notes that Abongile Damente, Zuko Sizane, Onke Mtwalo, Mandilakhe Mbali and Odwa Matomane will be sentenced on 26 February;

(3)takes this opportunity to welcome the sentencing of these heartless criminals who have demonstrated no sense of regard for the rule of law; and

(4)congratulates the police and the justice system for ensuring that these criminals face the full might of the law and are completely removed from our society.

Motion agreed to in accordance with section 65 of the Constitution.

Mr A G MATILA

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Mr B NESI

MADIBENG LOCAL MUNICIPALITY PLACED UNDER ADMINISTRATION

(Draft Resolution)

Mr A G MATILA: Chair, I hereby move without notice:

That the Council-

(1)notes that after protests against allegedly corrupt municipal officials in Madibeng Local Municipality as well as the findings of an investigation that was conducted last year by the Department of Co-operative Governance and Traditional Affairs that revealed corruption, fraud and maladministration in the municipality, the provincial government of the North West declared the municipality dysfunctional and placed it under administration last Monday;

(2)further notes that a task team consisting of the office of the premier and various provincial departments has since launched an investigation into service delivery challenges in the area;

(3)welcomes the decisive and swift action of the premier and her government in their commitment to uncover corruption and to institute criminal proceedings and other steps against officials, councillors and service providers involved without fear or favour; and

(4)takes this opportunity to call on all councillors to co-operate and put the interests of the community first and to ensure that the municipality is successfully turned around.

Motion agreed to in accordance with section 65 of the Constitution.

Ms M L MOSHODI

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Mr A G MATILA

GAUTENG HEALTH DEPARTMENT COMMENDED ON ZERO TOLERANCE FOR CORRUPTION

(Draft Resolution)

Ms M L MOSHODI: Hon Chairperson, I move without notice:

That the Council-

(1)notes with great concern the suspension of 17 officials at Dr George Mukhari Academic Hospital in Garankuwa, Gauteng, on Thursday, 13 February 2014;

(2)further notes that the officials from different sections of the hospital were suspected of selling jobs and appointing their family members and friends to positions in order to enrich themselves;

(3)takes this opportunity to commend the Gauteng Provincial Health Department for heeding the call to demonstrate zero tolerance for nepotism and corruption in the Public Service; and

(4)calls upon all public servants, including organised labour, to join hands with government in the fight against any form of corruption in the Public Service.

Motion agreed to in accordance with section 65 of the Constitution.

Mrs N W MAGADLA

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Ms M L MOSHODI

THE LATE MR M B SKOSANA

(Draft Resolution)

Mrs N W MAGADLA: Chairperson, I hereby move without notice:

That the Council-

(1) notes with profound sadness and shock the untimely death of hon Ben Skosana, who was a stalwart and veteran founding member of the Inkatha Freedom Party and a selfless veteran Member of Parliament;

(2) further notes that Ntate Skosana, as he was affectionately known, did his work with diligence while serving the people of South Africa until his untimely death;

(3) also notes that hon Skosana played a significant role in the transformation of South Africa's prison system from apartheid-era death camps to correction, rehabilitation and reintegration centres based on the values of human rights;

(4) notes that, at the time of his death, he was Parliament's House Chairman for Internal Arrangements, through which he championed the task of building the capacity and wellbeing of Members of Parliament, ensuring they have better support services and health to enhance their capacity to serve the people; and

(5) takes this opportunity to convey its profound condolences to the Skosana family and his party and wish them strength in these difficult times.

Motion agreed to in accordance with section 65 of the Constitution.

Ms M W MAKGATE

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Mrs N W MAGADLA

EDUCATION CRISIS IN MITCHELLS PLAIN, CAPE TOWN

(Draft Resolution)

Ms M W MAKGATE: Chairperson, I hereby move without notice:

That the Council-

(1)notes with concern that more than four weeks into the school year, between 801 100 learners in Mitchells Plain in Cape Town are yet to be registered at schools;

(2)also notes that, despite this alarming and shocking state of affairs, the Western Cape Education Department has not come up with a solution or provided an insight into where these learners will be placed and that the MEC for Education, Donald Grant, who at his appointment to this portfolio publicly stated that he knows nothing about education and has desperately attempted to close schools last year, prefers to remain silent;

(3)further notes with concern that the provincial education department, while admitting that it was aware of the demand and lack of space at schools, has clearly failed to fulfil its constitutional mandate or plan properly in order to build new schools timeously or provide interim accommodation for these learners; and

(4)acknowledges that this state of affairs deprives these learners of their constitutional right to basic education; and takes this opportunity to call on the Minister of Basic Education to come to the rescue of this community.

The CHAIRPERSON OF THE NCOP: Is there any objection? There is an objection and in the light of the objection the motion may not be proceeded with. The motion without notice will now become a notice of a motion.

Mr C J DE BEER

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Ms M W MAKGATE

CALL FOR THE REINTRODUCTION OF FEEDING SCHEMES AT FEE-PAYING SCHOOLS

(Draft Resolution)

Mr C J DE BEER: Hon Chairperson, I hereby move without notice:

That the Council-

(1)notes with concern that many learners in Kimberley in the Northern Cape are going hungry after school feeding schemes at fee-paying schools ended recently;

(2)further notes that many of the learners at these schools are from disadvantaged and poor households, with most of them receiving only one meal a day, that being the meal that they receive at the school;

(3)also notes that while feeding schemes at fee-paying schools cannot be funded by the National School Nutrition Programme or from conditional grant funding, the provincial government has, in the interim, embarked on a reduced allocation for qualifying fee-paying schools and are funding feeding schemes for such schools from the province's equitable share budget;

(4)further notes that this has, however, placed enormous pressure on other priority areas; and

(5)takes this opportunity to call on the Minister of Basic Education as well as the National Treasury to intervene urgently and to reintroduce school feeding schemes for qualifying fee-paying schools and to provide the appropriate funding.

Motion agreed to in accordance with section 65 of the Constitution.

Mr A J NYAMBI

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Mr C J DE BEER

A CALL TO REVIEW THE RELEASE OF A MURDER ACCUSED FROM PRISON

(Draft Resolution)

Mr A J NYAMBI: Chair, I hereby move without notice:

That the Council-

(1)notes with shock and concern that a murder accused in KaBokweni, in Mpumalanga, facing two counts of murder, a charge of robbery and two charges of possession of unlicensed firearms and ammunition, was released on warning last week in a magistrate's court after having been arrested at his hiding place after a tip-off;

(2)further notes that this state of affairs has the potential to undermine the confidence of the community in the police, the criminal justice system as well as the morale of the police, who work hard and often risk their lives to bring crime suspects to book;

(3)also notes that, although everyone remains innocent until proven guilty in a court of law, the nature of the charges against the accused and also his running and hiding from the police should have necessitated a different approach during his bail application;

(4)takes this opportunity to support the concern of the MEC for Community Safety of Mpumalanga about this state of affairs; and

(5)supports his call to the Provincial Commissioner of Police and the National Prosecuting Authority urgently to review the release of the accused.

Motion agreed to in accordance with section 65 of the Constitution.

Mr B L MASHILE

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Mr A J NYAMBI

VIDEO SHOWING WATERKLOOF FOUR PARTY

(Draft Resolution)

Mr B L MASHILE: Chairperson, I hereby move without notice:

That the Council-

(1)notes with utter repulsion a video showing two of the so-called Waterkloof Four partying in the Kgosi Mampuru prison while also showing off their cellphones, smoking cigarettes and drinking liquor in a cell equipped with a sink, a table, a computer, and a pot plant with heart-shaped leaves;

(2)further notes that Christoff Becker, Frikkie du Preez, Gert van Schalkwyk and Reinach Tiedt were released on parole last week after serving half of their sentences for brutally assaulting and killing a homeless man in Pretoria in 2001;

(3)takes this opportunity to condemn in the harshest possible terms this blatant flaunting of the Correctional Services Act and anything else that the department stands for; and

(4)calls on the Minister of Correctional Services to ensure that-

(a) the investigation currently under way is completed with urgency;

(b) anyone found to have flouted the rules of the department is dealt with very harshly; and

(c) the parolees be taken back to serve their remaining sentences should they be found to have flouted their parole conditions.

The CHAIRPERSON OF THE NCOP: Hon members, I shall not put this motion to the House for agreement because a commission has been formed to investigate the case. We will deal with this matter after the commission has dealt with it.

Ms M G BOROTO

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The CHAIRPERSON OF THE NCOP

PRESIDENT JACOB ZUMA'S 2014 STATE OF THE NATION ADDRESS

(Draft Resolution)

Ms M G BOROTO: Chairperson, I hereby move without notice:

That the Council-

(1)notes that President Jacob Zuma delivered his state of the nation address last week Thursday, reiterating that South Africa is a much better place to live in now than it was in 1994;

(2)further notes that, since the dawn of democracy in 1994, South Africa has been able to overcome all the pain of its past to build a new society, build strong institutions of democracy, bury the undemocratic, unrepresentative, oppressive and corrupt state that served a minority, and create a thriving constitutional democracy with well-functioning arms of the state - the legislature, the executive and the judiciary; and

(3)takes this opportunity to welcome the 2014 state of the nation address and acknowledge that South Africa truly has a good story to tell.

The CHAIRPERSON OF THE NCOP: In light of the objection, the motion may not be proceeded with. The motion without notice will now become a notice of a motion.

Mr G G MOKGORO

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Ms M G BOROTO

THE VICIOUS AND RELENTLESS CYBERBULLYING AND VILIFICATION OF HON THANDILE SUNDUZA

(Draft Resolution)

Mr G G MOKGORO: Chairperson, I hereby move without notice:

That the Council-

(1) notes with utter contempt the vicious and relentless cyberbullying and vilification of hon Thandile Sunduza because of her weight and the dress she wore to the state of the nation address last week;

(2) further notes that Ms Sunduza was admitted to a hospital in Johannesburg after collapsing at the O R Tambo Airport last week;

(3) also notes that her doctors have placed her under strict medical supervision, taking into account that she is at an advanced stage of pregnancy; and

(4) takes this opportunity to condemn in the strongest possible terms this utterly senseless bullying of Ms Sunduza as nothing but crass sexism and gender objectification of women.

Motion agreed to in accordance with section 65 of the Constitution.

The ACTING CHIEF WHIP OF THE COUNCIL

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Mr G G MOKGORO

SUSPENSION OF RULE 238(1) AND REVIVAL OF PUBLIC ADMINISTRATION MANAGEMENT BILL [B 55-2013]

(Draft Resolution)

Ms M G BOROTO (on behalf of the Chief Whip of the Council): Chairperson, I move the Draft Resolution printed on the Order Paper in the name of the Chief Whip of the Council:

That the Council, notwithstanding Rule 238(1) which provides inter alia that all Bills introduced in the Council and which have not yet been passed by the Council when it rises on the last day in any annual session lapses, revives the Public Administration Management Bill and condones any work the committee has done on the Bill.

Question put: That the motion be agreed to.

In favour - Eastern Cape, Free State, Gauteng, KwaZulu-Natal, Limpopo, Mpumalanga, Northern Cape, North West.

Against - Western Cape.

Motion accordingly agreed to in accordance with section 65 of the Constitution.

FIRST ORDER

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MOTIONS WITHOUT NOTICE - Ms M G BOROTO

SPECIAL ECONOMIC ZONES BILL

(Consideration of Bill and of Report of Committee thereon)

The MINISTER OF TRADE AND INDUSTRY: Hon Chairperson, hon members, the Special Economic Zones Bill, which is the Bill that is being tabled today, aims to support broad-based industrialisation, balanced regional industrial growth and the development of more competitive and productive regional economies.

Special economic zones may be defined as geographically designated areas of a country, set aside for specifically targeted economic activities, supported through special arrangements and systems that are often different from those that apply in the rest of the country. Up to now in South Africa, we have only one form of special economic zone, SEZ, the industrial development zones, IDZs, that have operated under the Manufacturing Development Act of 2000.

To date, five industrial dvelopment zones have been designated. They are Coega, East London, Richards Bay, O R Tambo and Saldanha Bay. The recently designated Saldanha Bay Industrial Development Zone, which was launched in October 2013, has already attracted eight investors, six of whom have signed up in the oil and gas services sector. Three of the remaining four IDZs, namely Coega, East London and Richards Bay, are fully operational. Combined, they host 42 operational investments with the value of R4 billion, which have created over 5 000 direct jobs and 43 000 jobs in construction.

Despite these achievements, some weaknesses in the implementation were identified during the IDZ policy review. These included weak governance, arising, in many cases, from unclear mandates of different structures involved; the lack of industrial development zoning centres; poor stakeholder co-ordination; and a lack of integrated planning.

More importantly, the criteria for the IDZ designation meant that IDZs were restricted to ports, airports and coastal regions, and were not available to assist in realising the economic potential in other parts of the country.

Industrial development zones, by nature, cater for export-oriented industries and closeness to a sea or an airport becomes a strategic consideration for logistical purposes. Due to these identified weaknesses, the programme could not assist other parts of the country to unlock long-term development potential in regions that had this potential and they could not therefore reverse the tendency well-established towards economic concentration in our country.

The Department of Trade and Industry, DTI, therefore identified the SEZ programme, which will be brought into existence by the passage of this Bill. Besides serving as an enabler to more effective regulation of all SEZs, including IDZs which are one category of special economic zone, the Bill proposes broadening the scope of SEZs to include categories other than IDZs that will, of course, still remain one of the forms of special economic zones.

The intention is that SEZs will focus on and support the manufacture of value-added products. Once designated, it is expected that SEZs will have strong backward and forward linkages with other sectors in their localities, building and strengthening localisation through supplier development programmes, which is a departure from the traditional SEZ model, where SEZs existed as isolated enclaves. Special economic zones are, of course, just one of many policy tools available to government in its drive to support industrialisation. However, SEZs offer a potentially valuable tool to overcome some of the existing constraints in developing industrial capabilities, in attracting investments and growing exports.

The aim of the Bill before the Council this afternoon is to boost private investment, both domestic and foreign, in labour-intensive areas, and to increase job creation competitiveness, skills development and technology transfer, as well as the export of beneficiated products. The Bill builds on the experience that we have gained from the IDZ programme and introduces a number of new measures that take into consideration inputs that were made in the consultation processes.

The Bill will introduce a variety of special economic zones to cater for the various socioeconomic and regional spatial planning considerations of the different spheres of government. In particular, the Bill provides for the designation of the following types of SEZs: free ports; free trade zones; the industrial development zones and sector development, or specialised, zones. By making it possible to have different categories of special economic zones, we aim to address the previous challenges experienced within the IDZ programme, allowing for the tailoring of individual SEZ strategies to fit with the individual needs and demands of the region concerned.

The Special Economic Zones Bill consultative process started in 2010, with all relevant stakeholders across the three spheres of government, as well as relevant interested public entities. The Bill was also discussed in the Economic Ministers and Members of the Executive Council, Minmec, which has also been working on pre-feasibility studies on 10 potential SEZs, at least one per province.

Cabinet approved the Bill for public consultation in December 2011. National Economic Development and Labour Council, Nedlac, consultations were finished in October 2012 and the Bill was introduced into Parliament in March 2013. It passed through hearings in the portfolio committee and then it was tabled in the National Assembly, last year.

In the NCOP process, the Bill was presented to eight of the nine provincial legislatures at 16 provincial public hearing meetings. It has received overwhelming support from the provinces and the society at large. All of this has resulted in further improvements in the form of a regulatory framework supporting the SEZ programme.

Furthermore, extensive regional and international benchmark studies have been conducted to determine an appropriate package of support measures for the SEZ programme. The following measures are being considered to enhance South Africa's SEZ value proposition. They include an SEZ tax incentive strategy, which will allow 15% corporate tax; a building tax allowance; an employment tax incentive; customs control area with vat exemption and duty free and an accelerated 12I tax allowance. It includes an enhanced funding strategy, which will include the establishment of a comprehensive SEZ fund with a mix of funding instruments, public-private partnership arrangements, and so on. It will also include an infrastructure strategy to accommodate bulk infrastructure requirements through an SEZ fund and other contributions.

There will be a skills and supplier development programme worked out with the Department of Trade and Industry and relevant partners to provide support programmes in these particular areas for SEZs. There will be a one-stop shop strategy to reduce bureaucracy and red tape of government approvals and applications, providing a single point of investor contact, which will be implemented within each SEZ. This one-stop shop platform aims to reduce information search and transaction cost for investors located in the SEZs. It also aims to facilitate the acquisition of permits and licenses; to reduce the steps in approvals; and to provide the more effective and sustainable investor aftercare service. The DTI is in the process of finalising the model that will see this roll-out soon.

The SEZ tax incentive offering has already been announced by the Minister of Finance and will ensure that we are able to provide an investment environment that can compete effectively with other locations in the world. These incentives will become effective on the enactment of the Special Economic Zones Bill.

We are currently preparing for the implementation of the Special Economic Zones Bill by consulting with all provinces on potential SEZs. As a result, as I said earlier, together we have commissioned a number of prefeasibility studies, which means that when the Bill is passed, we will not have to spend an inordinate amount of time because we have already done some of the preparatory work on the designation of potential SEZs. It is thus imperative that this Bill is expeditiously considered in order to take advantage of the huge imminent interest and opportunity which it will create. The Council's support for the Bill will be greatly appreciated.

I would like to express my sincere appreciation to the Select Committee on Trade and International Relations and the provinces that worked on this particular Bill and ensured not only that it was completed within a short space of time, but ensured also that there was a good quality piece of work that came out of the process. The committee's contribution in this regard has been invaluable and I would therefore like to salute its chairperson, Mr Gamede.

My thanks also go to the DTI team for their hard work in rolling out this piece of legislation. I have pleasure in commending this Bill to the National Council of Provinces. Thank you very much. [Applause.]

Mrs B ABRAHAMS

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The MINISTER OF TRADE AND INDUSTRY

Mrs B L ABRAHAMS: Hon Chairperson, hon Minister, hon members and guests in the gallery, the Special Economic Zones Bill sets out the legal framework for the designation of specific geographic areas as special economic zones. The hope is that the SEZs will attract new domestic and foreign investments into our country and that more jobs will be created.

The success of the SEZ strategy depends on the attractiveness of the incentives offered, even though the legislation does not outline what incentives will be available. We can only hope that the correct environment for investment will be created. The Bill only sets out the process for the formation of SEZs and how investors may locate their companies within the SEZs.

The Bill states that the developer may appoint any public or private entity to operate the SEZ. The Bill allows for the establishment of public entities, such as national government departments and provincial and local municipalities, to develop SEZs. Local and provincial governments will be able to apply to the Minister to delegate incentives offered by national government but can also delegate their own SEZs and offer their own incentives.

This is an important piece of legislation which paves the way for South Africa's first co-ordinated and incentive-driven SEZ strategy. We hope that this will strengthen the role of local and provincial governments.

Any business seeking to locate in an SEZ must seek approval from the SEZ board. Each SEZ is governed and managed by a board of directors. The Bill confirms that designated industrial development zones, IDZs, will become SEZs.

There will be special tax reductions for employees working in SEZs. Restrictions around the location of SEZs have been removed. This allows for SEZs in underdeveloped and rural areas where there are untouched economic growth and potential for opportunities of employment. Each SEZ will be unique to the needs of the region and its location, which we hope will help in attracting targeted investments.

This Bill has the potential to create more opportunities for unemployed people to be employed. This would also allow locals not to migrate to other provinces but be employed within their provinces. By providing jobs, this Bill could restore pride and dignity to the unemployed as well as achieve self-sustainability in rural areas. Jobs allow independence from reliance on government grants and enable a self-determined lifestyle. Project steering committees and oversight committees have been established in all provinces.

If implemented correctly, the Special Economic Zones Bill would assist in alleviating poverty in South Africa, but skills development still needs to take place. It is not the SEZs that should automatically create skilled people. People need to be given the opportunity to be developed. Then South Africa will not have the need to import important skills. Thank you. [Applause.]

Mr D D GAMEDE

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Mrs B L ABRAHAMS

Mr D D GAMEDE: Chairperson, hon Minister and hon members, all South Africans and especially all provinces in South Africa should be celebrating that we are finally passing the Special Economic Zones Bill today.

As has been said, the main purpose of this government has been to accelerate industrialisation for economic development. This Bill empowers the Minister to establish the SEZ fund. This is something that was not there before.

The purpose of the Bill is to develop infrastructure to support the development of targeted industrial activities per province. It also promotes regional development. As the Minister mentioned, we all know that great minds think alike. The following tax incentives have been approved: Corporate tax of 15% for investors in SEZs; building tax allowance; the accelerated 12I tax allowance; employment tax incentives; and vat exemption and duty free. We are really moving South Africa forward.

However, we as a committee raised the issue of municipalities in general being eligible for designation, taking into account the task that they have with regard to service delivery. Even though this was explained thoroughly, we still persisted in raising the issue.

One province that will benefit from this Bill if passed today is KwaZulu-Natal. We already have the Dube TradePort that is ready to roll out and function as of tomorrow.

The committee also raised the issue that in order for us to move faster with transformation, it is mostly historically disadvantaged individuals and groups that must benefit from being owners of licences. This will assist us in speedily transforming our country so that our economy is shared by every citizen in the country.

As has been mentioned, provinces – which we represent as the NCOP – can either have a free port if they have a port; a free trade zone; an industrial development zone; or a sector development zone. All these categories can be prescribed by the Minister. We are really moving South Africa forward.

A number of issues have been covered by the Minister and my detachment is ready to talk. We want to thank the department, the director-general and all his officials, including Saroj, for availing themselves each time we call them. We therefore recommend that the House adopts this Bill with a huge smile. Thank you. [Applause.]

Mr L MAILE

UNREVISED HANSARD

NATIONAL COUNCIL OF PROVINCES

Tuesday, 18 February 2014 Take: 5

Mr D D GAMEDE

Mr L MAILE: Chairperson, hon Minister, members of the Portfolio Committee on Trade and Industry, hon members of the House and distinguished ladies and gentlemen, greetings to all of you. It gives me great pleasure to represent the province of Gauteng on this important piece of legislation that will shape the economic landscape of our country. I am grateful to be part of this important work that will assist in addressing the triple challenges of unemployment, poverty and inequality that confronts our country,

As the province of Gauteng, we support the Bill in its current form precisely because it attempts to address the challenges that our people are confronted with on a daily basis. As Gauteng we believe that this Bill will support reindustrialisation so that the provinces and regions can regain their comparative and competitive advantages around manufacturing, inward investments, export promotion, research and development.

Furthermore, it increases the provincial stock of productive infrastructure with the incentives and financial set asides that come into effect when the Bill is enacted. The regions will be economically resuscitated, thus creating much-needed jobs.

As provinces we stand to benefit from the designation of SEZs given that we will have a share in the incentives that come with such a status. We believe that the enactment of the Special Economic Zones Act will unlock the resources for the provision of world-class productive infrastructure built through the SEZ fund support, and reindustrialisation through clustering.

Through centralised marketing spearheaded by Trade and Investment SA that is codified in the Special Economic Zones Bill, all the provinces will have an added benefit arising from the international marketing of SEZ industrial parks. The provision of the Special Economic Zones Act will lead to the strengthening of the sectoral competitive advantage of regions and ring-fence job creation, and skills and technology transfer.

We also support the Bill's assertion that provincial stakeholders must be consulted before submitting a proposal for designation to the Department of Trade and Industry, as this reduces tensions as well as separate development. We are mindful of the fact that all the powers to designate, to issue operating licences, to operate in the SEZ space and to appropriate funding resides with the Minister of Trade and Industry. This function is performed in consultation with the SEZ board. We support this assertion.

In conclusion, as we have alluded to before, we are unable to see any provision of the Bill that will negatively affect Gauteng province, economically or otherwise. We believe that the Special Economic Zones Act will benefit the province and the regions to the extent of creating a new growth trajectory. We as the province of Gauteng therefore support the Bill in its current form. Thank you. [Applause.]

Mr K A SINCLAIR

UNREVISED HANSARD

NATIONAL COUNCIL OF PROVINCES

Tuesday, 18 February 2014 Take: 6

Mr L MAILE (GAUTENG – MEC Sports, Arts & Recreation)

Mr K A SINCLAIR: Hon Chairperson and Minister, strengthening the South African industrial base and promoting a labour-absorbing industrial plan necessitate a new approach that will increase foreign direct investment. This approach is the purpose of the special economic zones, the SEZs. The approach is an economic tool to promote national economic growth and export by using support measures in order to attract targeted foreign and domestic investments and technology.

The economic impact of the SEZ is well-represented in a comprehensive study that was conducted by Jin Wang of the London School of Economics. Wang collected unique data of Chinese municipal economic statistics from 1978 to 2007 and used it to evaluate the impact of an SEZ experiment aimed at attracting foreign direct investment. Guided by three predictions from a theoretical model, it was concluded that the SEZ policy: Firstly, increases per capita foreign direct investment by 58%, mainly in the form of foreign investment and export orientated industrial enterprises; secondly, it does not crowd out domestic investment and domestically-owned capital stock; and thirdly, improves total factor productivity growth rate by 0,6 percentage points.

The results suggest that creating SEZs not only brings capital but also more advanced technology and provide important policy implications for many developing countries. From 1979, China has gradually created SEZs in its municipalities with property rights protection, tax breaks and a preferential land policy, specifically for foreign investors. This SEZ experiment has transformed China into one of the largest foreign direct investment, FDI, recipients, exporters and foreign exchange reserve holders in the world.

Where does this leave South Africa, especially the underdeveloped rural poor and marginalised like the province that I represent – the Northern Cape? This legislation can be a game-changer if implemented correctly in order to substantially increase the growth rate in South Africa. One of the challenges that the hon Minister must address is the detail as envisaged in the SEZ strategy.

Strategy, indeed, determines outcome. And here, hon Minister, I beg you not to implement a strategy like the DA and Agang did recently, by doing political fronting to acquire a suitable presidential candidate for the upcoming elections. [Laughter.] [Interjections.] The DA initially presented the leader of Agang as a black knight on a white horse. They, it seems, very quickly realised the blunder.

The strategy must include inter alia that the communities in and around the designated SEZs benefit substantially from these major economic injections and opportunities. The programmes of government must not remain documented ideas and philosophies; they must be implemented. South Africa has enough plans – let us do it. Localisation and beneficiation must be the cornerstone of the strategy.

It is further necessary to consider heterogeneous or mixed zones that will make it possible to have a multizone economic activity in place. That was the success in China and will also determine the success in South Africa. Cope supports the Special Economic Zones Bill. I thank you. [Applause.]

Ms D Z RANTHO

UNREVISED HANSARD

NATIONAL COUNCIL OF PROVINCES

Tuesday, 18 February 2014 Take: 6

Mr K A SINCLAIR

Ms D Z RANTHO: Chairperson, hon Minister, members of this House, special delegates, guests, ladies and gentlemen, let me take this opportunity and say happy New Year to all of you. I have not seen you since last year. This is our first sitting of this august House after the passing away of our icon, honourable Mr Rolihlahla Nelson Mandela. May his soul rest in peace. [Interjections.]

This sitting is also the first after the state of the nation address by our President, who reminded us about what the ANC has done during the past five years of its administration. The President clearly outlined all projects and Bills that were passed in our term of office clearly, telling the people of South Africa our story. Indeed, as government, we really have a good story to tell. [Interjections.]

The President acknowledged the fact that there is still a lot that needs to be done. There are a number of laws that need to be changed and amended. This Bill indicates the tasks that the economic cluster will be facing in the next five years. Our ANC 2014 Election Manifesto for 2014 to 2019 term of government has outlined strategies to be followed on how to radically transform the economy and consolidate the democracy of this country.

If you remember the ANC's 53rd National Conference in Mangaung in December 2012, our theme had outlined what needed to be done. If I may remind all of us, the theme was, Unity in Action Towards Socioeconomic Freedom.

The ANC has characterised the second phase of our transition as one of deepening economic transformation to eradicate poverty, creating full-time employment and reducing inequality. I think this Bill is trying to address exactly that. We cannot run away from our past as it will always remind us where we come from, especially we who got educated under the Bantu Education system. It was established purposely not to develop us mentally so that we could remain without skills.

Hence, we are now faced with a challenge of lack of skills, unemployment and institutional capacity. It is impossible to try to build this back in 20 years when it was implemented from 1652 up to 1994. There is a lot of damage that was done to us black South Africans.

The objectives of this Bill – all six of them - are stated clearly in chapter 1 of the Bill. This should be everybody's business in government as well as the private sector. Together we can move South Africa forward. Keeping our past in mind, the strategies that are set out in the Bill need to be clearer for an ordinary person on the ground to understand. South Africa is regarded as a rich country because of its natural resources. Therefore, we can attract many investors in this country. As much as we are regarded as a rich country, our people are very poor.

There is potential for economic growth, hence the attraction of foreign countries. If we can develop our infrastructure, some of which is dilapidating while the other is nonexistent, we can win the battle of unemployment. By now, everybody knows that I come from the Eastern Cape province, in Joe Gqabi District Municipality. [Interjections.] My region is one of the rural rich regions in the Eastern Cape.

Chapter 2 of the Special Economic Zones Bill, which talks about the purpose of the special economic zones, SEZs, and the promotion of regional development, also means the linkage or integration with the province's growth, strategies and the local economic development of the whole municipality. I think this Bill is very relevant to my region. Therefore, there is not doubt about the necessity of SEZs in my area because we have seen that where it is being implemented, the surrounding economy is energised.

In Joe Gqabi District Municipality this concept will flourish because this will be hard-pressed in a region that is more in need of a different strategy. The district municipality has commissioned for a formulation of a development agent, which is now three years old, to do for the region the equivalent of what the region would get if it were deemed an SEZ. Mainly, it would do the following: Implement the special economic zones strategy; impact on economic development project in an integrated and sustainable manner; provide asset development management and acquisition that allows the development agency to take extract fees or acquire a stake in the development that it facilitates; maximise the return on assets in the medium and long term; co-ordinate public-private and civic resources; and contribute to projects and programmes.

This agent has projects that have attracted investors inside the country and abroad. Hon Minister, we have a mine in Aliwal North that is usually not recognised. However, it cannot create a large number of permanent jobs because there is a lack of technicians, engineers and other relevant skills. If that mine can be used ... [Interjections.] It is called Aliwal Spa. [Interjections.]

IsiXhosa:

Mr S S MAZOSIWE: Utheth' ezasekhaya ngoku. [Kwahlekwa.]

Ms D Z RANTHO: Kunjalo, ndithunyiwe apha. Ndizise umyalezo osuka ekhaya.

English:

By developing the Aliwal Spa, hon Minister, this can help to develop skills in the area and transfer other skills that are most needed in the area.

This Bill evokes the creation of decent and other economic and social benefits in the regions in which it is located by promoting small, micro and medium enterprises and co-operatives, as well as a skills and technology transfer. Therefore, the concept of this Bill can be a reality in my region. The ANC supports the Special Economic Zones Bill.

In the Eastern Cape, this government has made SEZs possible by establishing big projects like Coega and East London Industrial Development Zone, the IDZ, which is a good story to tell because our people are able to acquire certain skills. Investors are looking for a moving government, which I think the ANC government is, at the moment. We are moving but we must do it together with those who do not want to move. I thank you. [Applause.]

Ms M ROSHO (NORTH WEST: MEC ECONOMIC DEVELOPMENT, ENVIRONMENT, CONSERVATION & TOURISM)

UNREVISED HANSARD

NATIONAL COUNCIL OF PROVINCES

Tuesday, 18 February 2014 Take: 7

Ms D Z RANTHO

Ms M ROSHO (North West: MEC – Economic Development, Environment, Conservation and Tourism): Deputy Chairperson of the NCOP, Chairperson of the NCOP, Chief Whip, Minister of the Department of Trade and Industry, hon members, ladies and gentlemen, compatriots, good day. The North West province, also known as the platinum province, completed a study of our provincial economic landscape in 2011. This we did in response to the policy imperatives enjoining us to embark on an economic growth path through vigorous implementation of industrialisation programmes. Ours is a regional economy, experiencing acute structural imbalances where the primary sector dominates in both contribution to gross domestic product, GDP, and unemployment, yet manufacturing remains low in respect of both.

To the extent that value–added manufacturing has the potential to propel growth and create jobs, our endeavour is to meet the goals of job creation, poverty alleviation and the elimination of inequality through deliverable interventions in this sector, in particular.

We are amongst the provinces that pursued the industrial development zone strategy, after we were convinced by not only the potential but also the experience and evidence of other countries that chose this strategy. Many of these countries experienced poverty reduction through high employment opportunities generated through the manufacturing of exports and other intermediaries, in other words, strengthening the productive capacities of their economies to compete with the rest of the countries.

The Special Economic Zones Act will not only be an enabler to us, but a catalyst that will diversify our country's economy from mere suppliers of raw materials and net importers. We foresee an added acceleration of industrial development towards increasing a productive sector, towards sustainable growth and the creation of descend jobs. This will also lead to innovation amongst our young people through the skills development programme, which will bring diversity in terms of innovative thinking and respond to the needs of scarce and critical skills.

As a country in need of more than 5% growth, we must employ extraordinary measures, such as the creation of special economic zones to attract foreign investment and to increase export, in order to meet our balance account performance that is so important to a balanced currency level.

The North West province is no longer on onlooker in these developments, as we stand to benefit if we contribute to the country's agenda of beneficiation. We are the main source of platinum in the world and started long ago in investigating possible platinum beneficiation activities in the province. At least we have found our niche, which has an impact across a spectrum of policies in our country. When we embark on the fuel cell manufacturing with platinum group metals, PGM, as a major catalyst, not only shall we create jobs but also realise our own objectives in alternative energy requirements.

We are embarking on the platinum beneficiation sector development zone project that presents profound strategic merits for North West province communities. It has local and global platinum mining and production comparative advantages, given that high technology platinum beneficiation is nonexistent in the North West province.

This project aims to establish the platinum beneficiation sector development zone through the facilitation of general and specific research and industrial infrastructure, technical workforce and business support services, to support technology development, pilot production and the testing of commercialisation and manufacturing of fuel cells.

Like other provinces, we cannot wait to obtain the operator permit that will come into effect once this law has been promulgated. Then we have to answer to all and sundry that the government target of job creation is not a pipedream, but a target, real enough to be met. It is therefore our view as the North West provincial communities, led by the ANC-led government, to support the promulgation of the Special Economic Zones Bill of 2013 into an Act of Parliament. I thank you very much. [Applause.]

Ms A ROSSOUW

UNREVISED HANSARD

NATIONAL COUNCIL OF PROVINCES

Tuesday, 18 February 2014 Take: 7

Ms M ROSHO

Ms A ROSSOUW (Western Cape – Provincial Chief Whip): Hon Deputy Chairperson, Minister Davies, the potential economic benefits of the industrial development zones have been clearly outlined. A feasibility study into the creation of the Saldanha Bay industrial development zone estimates that the development could yield between 4 240 and 8 930 direct jobs over a 25-year period and add between R11,2 billion and R31,6 billion in yearly revenues to the regional economy. The report calculates the total number of jobs that could be created at between 11 900 and 29 000.

The Western Cape government believes that economic growth is the foundation of all successful development, and the role of the state is to create and maintain an enabling environment for business and to provide demand-led, private sector-driven support for growth sectors, industries and businesses.

We have noted the World Bank's study on special economic zones, SEZs, that found that private-led developments are more cost-effective and yield better economic results than state-owned variants. A clearly defined space should be created for the private sector to play a greater role in ownership of SEZs to accelerate the economic impact, as this is not addressed in the policy.

The gist of the World Bank report is that the most significant contribution that SEZs can make towards economic development in a country is not the incentive mechanisms, but rather the creation of a stable area with competent management, adequate infrastructure and minimal red tape.

The Bill should spell out more clearly the linkages with the local economy and the involvement of surrounding municipalities in the SEZs. It is further proposed that a section be included in the Bill that would safeguard against a drain of established businesses from the nonindustrial development zone to industrial areas for SEZs.

In light of the Bill's attempt to create a regulatory framework for the SEZs and to regulate the activities of the identified SEZs, the following concerns should be considered in the development and implementation of any policy or Bill that involves regulating these SEZs.

Firstly, SEZs are aimed at creating business hubs to foster economic growth. The industrialising of these SEZ areas tend to be a threat to farming businesses as it can result in taking away agricultural land. Provision should be made in the Bill to regulate the process of acquiring land from farmers in the neighbouring areas.

Secondly, the Bill should also include a section on a set of criteria for selecting the locations of SEZs. This can also help potential investors to identify SEZ areas based on the specific requirements.

Thirdly, it is important to note that SEZs are only a tool in the drive for greater economic growth. The SEZs need to be accompanied by policy instruments that make the country as a whole attractive to investors and business developers. For example, if the infrastructure in nonSEZ areas is not sufficiently integrated with the SEZs and there is too much bureaucratic red tape, the effectiveness of this legislation, in general, can be hindered.

The Western Cape will support this Bill. I thank you. [Applause.]

Mr F ADAMS

UNREVISED HANSARD

NATIONAL COUNCIL OF PROVINCES

Tuesday, 18 February 2014 Take: 8

Ms A ROSSOUW

Mr F ADAMS: Hon Chairperson, compliments of the season to you and all the best for the new year. You have started the year off with a bang - looking very elegant, just as we know you to look. Hon Minister and hon members of the National Council of Provinces, compliments of the season. I can see that this is really an election year. You are all looking so very elegant. The hon Mncube and the hon Mabe are looking very elegant.

The ANC has characterised the second phase of our transition as one of deepening economic transformation to eradicate poverty, create full employment and reduce inequality. The Special Economic Zones Bill is a Bill that, I think, is much needed. It is a Bill that has shown that there is political will in the Department of Trade and Industry, a department which is led by the hon Minister, Dr Rob Davies, Director-General Mr Lionel October and the staff. This is a Bill that is much needed in terms of eradicating and reducing inequality, eradicating poverty and creating employment.

I heard my colleague, the hon chief whip from the Western Cape, saying, to my astonishment, that the Western Cape was the first province that said we must push this thing through. This thing must go through. It was in the Western Cape in Saldanha Bay where the Minister went to make the announcement. Hon Rossouw, through you, Chairperson, MEC Alan Winde was so excited that he even spoke longer than the Minister and we had to cut him short. [Laughter.] He never mentioned in his speech on that day one thing about the DA. He said, "South Africa", not even "the Western Cape government", but "South Africa".

Therefore, as the President rightly said in the state of the nation address, we have a good story to tell. This is part of the story that we are telling - that we are building on the suffering over the years, the lives that were lost, the lives that were numbed, the lives that limped by. We can build on the suffering of the heroes of which you were part, Chairperson. All other members were part of that. The hon Montsitsi was part of that in 1976. So, members themselves can identify with this. There were those who suffered gunshots, hiding in trenches, hiding under beds, hiding all over and sleeping in the bushes, and those going into exile. We can clearly say that this Special Economic Zones Bill was built on this triumph of those heroes and heroines who suffered under the legacy of apartheid.

This is because there was political will. I want to say to the hon Rossouw, through you, Chairperson, that the ANC does not suddenly wake up one morning and decide that must be there. The ANC has taken decisions, going back to the conference in Limpopo and the conference in Mangaung, that economic transformation must happen. We have good cadres and good leaders who implement, and part of implementation is this Special Economic Zones Bill.

The ANC does not wake up and say, let us march on to the house of the DA because there is no job creation. [Applause.] The ANC does not wake up one morning and, soos hulle in Afrikaans sê [as they say in Afrikaans], "'n Na-aper was nog nooit 'n aap nie." [Tussenwerpsels.] Hy is nie eens 'n goeie aap nie, soos hulle sê. [Someone who imitates is not really a monkey. He's not even a good monkey as they say.] The ANC does not wake up one morning and go and stand on a truck and toyi-toyi. I was looking at some of the toyi-toying of the members. They can't even toyi-toyi properly. [Laughter.]

The DEPUTY CHAIRPERSON OF THE NCOP (Ms T C Memela): Hon Faber?

Mr W F FABER: Hon Chair, I would just like to know if the hon Adams will take a question, please.

Mr F ADAMS: Put your question, hon Faber. Yes, Chair, he can put his question.

The DEPUTY CHAIRPERSON OF THE NCOP (Ms T C Memela): Proceed.

Mr W F FABER: Thanks, hon Chair. I was not sure what he was talking about when he referred to hiding under beds. I would like to know what he was hiding from.

The DEPUTY CHAIRPERSON OF THE NCOP (Ms T C Memela): Come on! Come on, Faber!

Mr F ADAMS: Chair, may I answer his question? We were hiding from the apartheid police – what you were, hon Faber ... [Applause.] ... apartheid police that were maiming our people, that came with dogs, guns and all that. There was no respect for women; there was no respect for life. That is what we were hiding from - people like you who killed people in South Africa, who maimed people, took people to prison, and that tortured people. Despite that, the ANC has conquered, and the ANC will conquer, and the ANC shall conquer. [Applause.] And it will conquer until Jesus comes, hon Faber. [Interjections.]

I want to say that political will has taken over. The ANC is on a roll. We want to deliver to the people of South Africa what has been promised: the promises we are making and the promises we are keeping as the government. I want to say that the ANC supports the Special Economic Zones Bill because it will create jobs.

I don't know why the DA wanted to march to create jobs because here it is, in black and white, that we will create jobs. So this political grandstanding by them and playing on our people's minds, playing with our people's feelings and thinking that our people are stupid must come to an end. The days of thinking for the majority of black South Africans must stop. I want to say to the DA: we can think; we can even outthink you because we have done that and we are delivering. [Applause.] That is how we are outthinking you. [Applause.]

This piece of legislation, we can say today, must really be commended. The Minister and the department must be commended. Our chairperson of the select committee, the hon Gamede, and our members of the select committee - even from the DA - were very enthusiastic about this. The Western Cape, where I come from, which purportedly is an island in South Africa, has also supported this. I am happy to hear that the chief whip of the province has supported this piece of legislation. We want to thank everybody, even Mr Sidwell Medupi, who is in our midst today. He is sitting in the gallery. We want to thank the Minister. We know that a lot of work has gone into this. We appreciate it.

Many young South Africans can proudly say today that the ANC has delivered with the Special Economic Zones Bill. Many businesspeople and poor people can today say that they are looking forward to the jobs that will be created, not to march for jobs, but jobs that will be created through this legislation. I thank you. [Applause.]

The MINISTER OF TRADE AND INDUSTRY

UNREVISED HANSARD

NATIONAL COUNCIL OF PROVINCES

Tuesday, 18 February 2014 Take: 9

Mr F ADAMS

The MINISTER OF TRADE AND INDUSTRY: Chairperson, thanks to all those who participated in the debate for the broad across-parties' support that we've had for this piece of legislation.

I just want to confirm a couple of particular projects that have been mentioned in the debate. I did say in my input that there are 10 prefeasibility studies, at least one per province, that are being undertaken now so that we could get much of a head start when this structure that is set up to take decisions meets. It would already have work before it on potential new special economic zones, SEZs. That includes actually more than one mineral-based project of the sort that was described by MEC Rosho from the North West. The Dube TradePort is also one of those under discussion. So, we are moving forward and it is a piece of work which we have tried to put in place so that we can shorten the time between passing legislation that will permit these different types of special economic zones and the actual implementation.

There were a number of points that people obviously appreciated and are quite excited about, ragarding the potential that these zones will create. There were also a couple of points I want to comment on. One of them was made by Ms Rossouw, where she said that management was as important as the incentives. I actually agree with that, because this is not a process where we just look for a hunt for incentives. Every part of the country is going to declare itself an SEZ, merely for the purpose of gaining access to the different government incentives. If we go that route, we will lose the special in the "special" economic zones. The whole country would rapidly become a special economic zone.

It is for that reason we have established a structure that will look carefully and strategically at this. That is also one of the reasons why the Bill will put in place new governing systems in the SEZs so that we can make these SEZs work at that level. For example, one of the features in its turnaround strategy for the East London Industrial Development Zone, IDZ, is that it had gathered huge momentum in the last five years. It was languishing for some time, but had gathered a lot of momentum. This has a lot to do with the way in which the management of the East London IDZ is able to present itself and its value propositions to investors, not only in automotive cluster, but also to broaden its reach into other activities.

The SEZs have to be special; they must have additionality. I have had people coming to me and asking me whether we can't redraw borders so that the existing businesses can be incorporated. The answer has to be no; it is about additionality, new investments and new wealth creation. It is not about simply extending a set of incentives.

There are some very important lessons that we can draw from other countries. I had the opportunity to visit one of the SEZs in Chemin in China last year. One of the features there was that they had a park of small, medium and micro enterprises, SMME, and supply development programmes. Supply development, as we have already mentioned, is part of this. They also had a park which has to do with research in innovation, drawing on the inputs of local universities. Those are the kind of things that we can learn from other countries about how we construct our SEZs.

I just want to say - and I think I have already covered this point - Mr Sinclair said that we should not try to copy the saga of Agang and the DA in the roll out of the SEZs. I could not agree with him more. I don't think we know the full details of that saga because there have been all kinds of stories in the newspapers. I hope in the fullness of time we will get some comments from the players.

Was there a dinner in London that was hosted by a certain individual who loves South Africa - so much so that he doesn't live here any longer; who loves his new adopted country to the extent that he doesn't pay any taxes there; and who loves peace and development so much so that his biggest investment is in the security features of the Israeli-Palestinian war? Is that the person who is calling the shots in this particular exercise? Is that the case or not?

However, I can assure everybody that we will not become tools and victims of special pleading. We will approach the roll out of SEZs strategically and developmentally in the interest of creating employment and the development of industries in this country. Thank you very much. [Applause.]

Debate concluded.

Question put: That the Bill be agreed to.

IN FAVOUR: Eastern Cape, Free State, Gauteng, KwaZulu-Natal, Limpopo, Mpumalanga, Northern Cape, North West, Western Cape.

Bill accordingly agreed to in accordance with section 65 of the Constitution.

SECOND AND THIRD ORDERS

UNREVISED HANSARD

NATIONAL COUNCIL OF PROVINCES

Tuesday, 18 February 2014 Take: 10

VOTING – FIRST ORDER

ELECTRONIC COMMUNICATIONS AMENDMENT BILL

(Consideration of Bill and of Report thereon)

INDEPENDENT COMMUNICATIONS AUTHORITY OF SOUTH AFRICA AMENDMENT BILL

(Consideration of Bill and of Report thereon)

Siswati:

Mk M P THEMBA: Sekela Sihlalo, Make Memela, malunga Alendlu lahloni, ngiyanibingilela nonkhe entsambama lamuhla, manene nemanenekati emnyakeni lomusha nginifisela tilokotfo letinhle. [Deputy Chairperson, Mrs Memela, hon members, I greet you all this year, I wish you the best this year]

English:

Deputy Chairperson, the Select Committee on Labour and Public Enterprises, having considered and made deliberations on the Electronic Communications Amendment Bill on 5 February 2014, wish to report as follows. The main objectives of the Electronic Communications Amendment Bill are to align the Act with broad-based black economic empowerment, BBBEE, initiatives and to refine licencing issues within the communications sector, as well as to provide the terms of appointment for and duties of the chief executive officer, CEO, including governance provisions for the Universal Service and Access Agency of South Africa, Usaasa.

In line with the digital information age, the Bill makes further provision for the discounted rate at which Internet services must be provided to schools, educational institutions and public health establishments, like hospitals. Despite the technical amendments to which the Bill refers in terms of alignment with BBBEE and the governance provisions of Usaasa and the appointment of the CEO, from a service delivery perspective, the Bill intends to bridge the digital divide between those who can and those who cannot afford the services of digital communications services.

It has long been our government's priority to ensure that the advantages brought about by developments in the information and communications technology, ICT, sectors are utilised for the benefit of our people. This cannot be more appropriate than reducing prices for such ICT services in the health system and education sector, in general. Indeed, no one can dispute the important role ICT plays in advancing the agenda of the socioeconomic development of any country, including our own.

It is for these reasons that the Bill received unanimous support from members of our committee. This was based on a common understanding that, as a developing country, we can only change the lives of our people if we make access to information and communications technology services as easy as voting.

Minor issues that were raised by stakeholders were thoroughly addressed during the deliberations, but, overall, all stakeholders understood the importance of the amendments proposed in the Bill. This includes the provisions which point to a well-run organisation with sound corporate governance principles. We support this proposed legislation with the best interests of our people at heart in so far as the digital divide is being narrowed and our people are given access to ICT services to improve their living conditions. We request the House to support this important piece of legislation.

I now come to the Independent Communications Authority of South Africa Amendment Bill. The Select Committee on Labour and Public Enterprises, having considered and made deliberations on the Independent Communications Authority of South Africa Amendment Bill on 12 February 2014, wish to report as follows. The main objectives of the amending Bill are to provide further clarity on the powers and duties of the Independent Communications Authority of South Africa, Icasa, and to introduce mechanisms to ensure the accountability of Icasa and of councillors. This includes the provision to confirm the use of electronic communications networks and services for the purpose of electronic transactions.

Key to the Bill's amendments are provisions that are intended to make Icasa more transparent and to ensure fairness within the broadcasting industry. For example, the Bill proposes that the minutes of a council meeting should be published on Icasa's website and also made available in the authority's library within 30 days after the meeting is held.

For the industry's role-players who are failing to comply with broadcasting licencing conditions, the Bill makes provision for a fine not exceeding R5 000 000, depending on the merits of the case. Clearly, there are people in the broadcasting industry who are bent on undermining the rules of fair competition, by either unlawfully leasing their licences or violating their licence conditions, thereby creating chaos in the industry. This Bill also seeks to tighten these loose ends and to ensure that there is stability and order in the broadcasting industry, as a show of commitment to the quality of its personnel, namely Icasa.

The Bill makes an important point that councillors should possess expertise and experience in the field of, among others, broadcasting, electronic communications and postal policy or operations, public policy development, electronic engineering law, information technology, finance, or any other relevant expertise or qualifications. This is, of course, in line with the details and demands of the broadcasting industry that are part and parcel of the competitive global arena, in which we, as a country, must always be on a par.

As a committee, when we deliberated on this Bill, we went over it with a fine-tooth comb, as we always do. We came across one clause that concerned us. We felt it is an important issue that needs to be addressed, not only on this Bill, but perhaps in all relevant legislation with similar connotations.

Clause 7(a) of the Independent Communications Authority of South Africa Amendment Bill makes reference to the National Assembly. As the Select Committee on Labour and Public Enterprises, we found this to be inappropriate, and preferred the word, "Parliament", instead. Since our concern, if followed up, would have had an impact on all related clauses and even other Acts, we agreed to support the Bill with the word, "National Assembly" in it.

We did, however, put it on record that the matter needs to be addressed in an appropriate way, since Parliament is made up of two Houses. Any exclusive reference to the National Assembly alone, technically, does not talk about Parliament as the South African Parliament, as the South African Parliament is a bicameral Parliament, comprising both the National Assembly and the National Council of Provinces. This matter can be taken up in the Fifth Parliament to correct the anomaly. Having said this, we, as the committee, gave this Bill our full support, based on the understanding that these amendments are intended to make the Icasa Council more transparent and the broadcasting industry more stable for the benefit of South Africans.

When we were voting on the Bill in the committee stage, all parties supported the Bill. However, this afternoon as I entered, the member of the DA approached me and told me that they were not going to support it. We support the Bill, however, and request this House to support this Bill, as well. I thank you so much. [Applause.]

Debate concluded.

Question put: That the Electronic Communications Amendment Bill be agreed to.

Electronic Communications Amendment Bill accordingly agreed to in accordance with section 75 of the Constitution.

Question put: That the Independent Communications Authority of South Africa Amendment Bill be agreed to.

The DEPUTY CHAIRPERSON OF THE NCOP (Ms T C Memela): Hon members, 30 have voted in favour, seven against. [Interjections.] No, I cannot pose that question. [Interjections.] Hon members, is there a problem? [Interjections.] Fine, we can add them. [Interjections.] Alright, the two members can now declare, in front of this House, whether they voted in favour or if they abstained. [Interjections.]

An HON MEMBER: In favour. [Interjections.]

The DEPUTY CHAIRPERSON OF THE NCOP (Ms T C Memela): Thirty-two have voted in favour, seven against.

Independent Communications Authority of South Africa Amendment Bill, subject to proposed amendments, agreed to in accordance with section 75 of the Constitution.

FOURTH ORDER

UNREVISED HANSARD

NATIONAL COUNCIL OF PROVINCES

Tuesday, 18 February 2014 Take: 11

THIRD ORDER

CONSIDERATION OF REPORT OF SELECT COMMITTEE ON SECURITY AND CONSTITUTIONAL DEVELOPMENT - DRAFT NOTICE AND SCHEDULE SUBMITTED IN TERMS OF SECTION 2(4) OF THE JUDGES REMUNERATION AND CONDITIONS OF EMPLOYMENT ACT, 2001

Mr A G MATILA (for Mr T M H Mofokeng): Deputy Chair, my understanding is that I am dealing with both judges and magistrates at the same time. On 11 February 2014, the Select Committee on Security and Constitutional Development received a briefing from the Department of Justice and Constitutional Development in relation to the proposed increases in the salaries of magistrates and judges respectively, as set out in the draft notice by the President that had to be approved by both Houses of Parliament.

For this year, the recommendation is that both magistrates and judges should effectively receive an increase of 5% across the board. However, a further adjustment was made in relation to magistrates in that the pensionable portion of their packages was raised to 70% to bring this in line with other public services compared to the 60% it had been in the past. The committee recommends that the Council approves the draft notices and schedules. I thank you, Chair. [Applause.]

Debate concluded.

Question put: That the Report be adopted.

IN FAVOUR: Eastern Cape, Free State, Gauteng, KwaZulu-Natal, Limpopo, Mpumalanga, Northern Cape, North West, Western Cape.

Report accordingly adopted in accordance with section 65 of the Constitution

FIFTH ORDER

UNREVISED HANSARD

NATIONAL COUNCIL OF PROVINCES

Tuesday, 18 February 2014 Take: 11

FOURTH ORDER

CONSIDERATION OF REPORT OF SELECT COMMITTEE ON SECURITY AND CONSTITUTIONAL DEVELOPMENT - DRAFT NOTICE AND SCHEDULE IN TERMS OF SECTION 12(3) OF THE MAGISTRATES ACT, 1993 (ACT 90 OF 1993)

Mr A G MATILA (for Mr T M H MOFOKENG): Deputy Chair, as I have already indicated, I am dealing with both magistrates and judges, I therefore recommend that the magistrates must also receive an increase of 5%. The committee asks this Council to approve it. [Applause.]

Debate concluded.

Question put: That the Report be adopted.

IN FAVOUR - Eastern Cape, Free State, Gauteng, KwaZulu-Natal, Limpopo, Mpumalanga, Northern Cape, North West, Western Cape.

Report accordingly adopted in accordance with section 65 of the Constitution.

The DEPUTY CHAIRPERSON OF THE NCOP (Ms T C Memela): May I take this chance to say to our delegate from the North West province that our machines at times do not work properly. Do not feel bad about it.

The Council adjourned at 15:54.