Hansard: NA: Unrevised hansard
House: National Assembly
Date of Meeting: 06 Mar 2012
Summary
No summary available.
Minutes
UNREVISED HANSARD
TUESDAY, 6 MARCH 2012
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PROCEEDINGS OF THE NATIONAL ASSEMBLY
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The House met at 14:02.
The Speaker took the Chair and requested members to observe a moment of silence for prayers or meditation.
ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS – see col 000.
NOTICES OF MOTION
Dr P J RABIE: Mr Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the DA:
That the House debates Transparency International’s latest global corruption perception index, which ranks South Africa as 64th, and recommendations to strengthen the fight against corruption.
Mr N SINGH: Mr Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the IFP:
That the House debates the knock-on effects of the current Eurozone crisis on the South African economy and recommendations to mitigate against any adverse effects arising from it.
Rev K R J MESHOE: Mr Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the ACDP:
That the House debates ways to help our people develop a positive mental attitude to lead a life of gratitude and develop a work ethic.
Mr B A RADEBE: Mr Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the ANC:
That the House debates measures to ensure large-scale investment in the productive sectors of the economy.
Dr D T GEORGE: Mr Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the DA:
That the House debates the role of the executive in the effective management of public finances, including their accountability to Parliament.
Ms B T NGCOBO: Mr Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the ANC:
That the House debates strengthening institutions to support innovation, research and development in agricultural activities.
Mrs J D KILIAN: Mr Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of Cope:
That the House debates the impact of establishing a media tribunal on media freedom and the right to freedom of expression.
Mrs C DUDLEY: Mr Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the ACDP:
That the House debates the need for Parliament to be presented with a detailed budget in respect of the proposed expenditure on nuclear power, the R300 billion to be spent on nuclear reactors and the cost of waste management.
Ms N D NGCENGWANE: Mr Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the ANC:
That the House debates public investment to create and maintain strategic economic and social infrastructure.
Mnr J J VAN DER LINDE: Mnr die Speaker, ek gee hiermee kennis dat ek in die volgende sitting van die Huis namens die DA sal voorstel:
Dat die Huis debat voer oor die huidige status en agterstand van betalings by goedgekeurde restitusie-eise en aanbevelings maak om die situasie te verbeter.
(Translation of Afrikaans notice of motion follows.)
[Mr J J VAN DER LINDE: Mr Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the DA:
That the House debates the current status and backlog in payments for approved restitution claims and recommendations to improve the situation.]
Adv L H MAX: Mr Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the DA:
That the House debates the application of section 42(a)(i) of the Employment Equity Act, Act No 55 of 1998, by the Department of Correctional Services in the Western Cape.
Mr D D VAN ROOYEN: Mr Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the ANC:
That the House debates assessing the private financial sector’s contributions to the investment and development goals of the country.
Mrs A STEYN: Mr Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the DA:
That the House debates viable options for legal information exchange between participants in the agricultural industry that does not fall foul of the Competition Act, Act No 89 of 1998.
WORLD KIDNEY DAY
(Draft Resolution)
Mr G D SCHNEEMANN: Mr Speaker, I move without notice:
That the House –
(1) notes that World Kidney Day is celebrated annually on March 8;
(2) further notes that World Kidney Day is a joint initiative of the International Society of Nephrology, ISN, and the International Federation of Kidney Foundations, IFKF;
(3) acknowledges that the 2012 campaign will focus on the positive outcome of kidney transplantation and the life-saving aspect of organ donation;
(4) further acknowledges that more than 5% of the adult population have some form of kidney damage and every year millions die prematurely of cardiovascular diseases linked to chronic kidney diseases, CKD;
(5) calls on everyone to check if they are at risk of developing kidney disease and encourages more people to take a simple kidney function test.
Agreed to.
SAD PASSING OF RENOWNED CONSERVATIONIST LAWRENCE ANTHONY
(Draft Resolution)
The CHIEF WHIP OF THE OPPOSITION: Mr Speaker, I move without notice:
That the House —
(1) notes the sad passing of renowned conservationist Lawrence Anthony at his home in KwaZulu-Natal on Friday at the age of 61;
(2) further notes that he was internationally acclaimed for his compassionate work at the Baghdad Zoo during the invasion of Iraq and for his efforts in Southern Sudan and the Democratic Republic of the Congo to keep the Northern White Rhino from extinction;
(3) recalls that in 2003 he formed the Earth Organisation and in 2004 he received the UN Earth Day medal;
(4) further recalls that he received high acclaim during his life for his publications, including his books “Babylon’s Ark” and “The Elephant Whisperer”; and
(5) expresses its condolences to the friends and family of Lawrence Anthony, and to the broader conservation community.
Agreed to.
DECENTRALISATION OF NATIONAL POLICE DAY CELEBRATIONS
(Member’s Statement)
Ms M A MOLEBATSI (ANC): Mr Speaker, the acting National Commissioner of Police, Lt Gen Nhlanhla Mkhwanazi, decided to decentralise the celebration of National Police Day to individual provinces. On 27 January 2012, in the Limpopo province, 4 000 SAPS members from Capricorn, Vhembe, Mopani, Waterberg and the provincial office gathered at the University of Limpopo to celebrate the day. The amount of R91 million that had been allocated for the day was used to purchase vehicles, office furniture and mobile air conditioners. Already, 140 steel cabinets, 20 moveable air conditioners and 35 vehicles have been delivered. All catering was done through donations from local businesses.
The ANC congratulates Lt Gen Mbembe and his project team of eight members for this initiative and for demonstrating the support that SAPS enjoys from the community at large and business in particular. The theme of the National Police Day, “Squeezing crime to zero through human capital investment”, came to life through this initiative. [Applause.]
CHAOTIC PROCESS OF SOCIAL GRANT REREGISTRATION
(Member’s Statement)
Ms E MORE (DA): Mr Speaker, the Minister of Social Development, Bathabile Dlamini, needs to account to this Parliament for the chaos surrounding the reregistration of social grant recipients. Reports have revealed that the reregistration process is in complete disarray, contrary to repeated assurances of “no interruptions” made by the Minister and the chief executive officer of the South African Social Security Agency, Sassa. Beneficiaries at the West End Community Centre in Port Elizabeth, for example, found at automated teller machines last week that there was no money in their accounts.
Minister Dlamini has publicly stated that her department wants to allay the fears of our people and assure them that the grants will not be cut following the tender awarded to Cash Paymaster Services to administer the social grants across all nine provinces. However, this was not the reality for hundreds of grant recipients recently. Beneficiaries reportedly said that nobody had informed them about the changes. According to beneficiaries, Sassa officials were very rude and impatient with them and had no control over the situation. Elderly recipients were trampled during the panic and mayhem.
The Minister must explain what steps will be put in place to ensure that similar episodes are prevented. Grants constitute the only source of income for many families and act as an immediate buffer against poverty and malnutrition. It is of absolute importance that the re-registration process ensures uninterrupted grant payouts and more efficient systems in the spirit of the Batho Pele principle. [Applause.]
SUPPORT FOR COSATU’S MARCH AGAINST E-TOLLING IN GAUTENG
(Member’s Statement)
Mr D A KGANARE (Cope): Mr Speaker, tomorrow our country will again experience disruptions as a result of the governing party’s refusal to listen to reason. Despite the calls for the enforcement of the Gauteng freeway tolling to be halted, the arrogance of the governing ANC emerged victorious again. As a result, Cosatu’s call for a march against tolling is understandable. It is aimed at channelling and harnessing the anger and frustration of the potential victims of this greed.
It is really unacceptable for any government to introduce this type of tolling without providing alternative routes. If one has to move from the West Rand to O R Tambo International Airport, one has to pass approximately six tollgates, since these have been created to ensure that road users are milked dry.
While Cope understands and supports Cosatu’s demands and march, we don’t support the disruption of schooling and education. We believe that educators and learners should be kept out of this fight. This is not a new call because during the height of the fight against apartheid, strikes and stay-aways were called, but nurses and doctors were always exempted.
It is high time that the people of South Africa understand that the attitude of the ANC government in relation to tolling in Gauteng is the permanent nature of the arrogance they have been displaying. This is no exception; it is part of the ANC’s DNA. Cosatu must learn and learn fast. Governance is not only elections, but what counts is what happens between elections. [Applause.]
FIRST FREE OUTDOOR GYMNASIUM IN SOWETO
(Member’s Statement)
Dr Z LUYENGE (ANC): Mr Speaker, in response to the President’s call in his state of the nation address, in which he encouraged South Africans to have a healthier lifestyle to reduce the impact of noncommunicable diseases such as diabetes, heart disease and hypertension, we welcome the first free outdoor gym in Soweto. The free gym in Petro Molefe Park is equipped with world-class gym equipment made of strong, durable and weatherproof material that enables it to withstand harsh weather conditions.
In addition, there will be security at all times, not only to protect the residents, but also the equipment. Fitness instructors and personal trainers will also be on hand to help residents work towards healthier bodies. Exercise and maintaining fitness and good health have been brought closer to the people of Soweto, especially for those who cannot afford to join commercial gyms.
When people improve their fitness, they become more productive and healthier. Residents are urged to take advantage of this service and to take care of the park so that they may enjoy its benefits for many years to come. Hon members of this august House have even started participating in a similar activity, namely a 2,5 km fun-run and walk on the premises of Parliament on Wednesdays from 12:30 to 13:30. The walk is organised by the Parliamentary Sport and Recreation Council. [Applause.]
COSATU STRIKE A SIGN OF INCREASING DISCONTENT
(Member’s Statement)
Mr J H VAN DER MERWE (IFP): Mr Speaker, tomorrow’s planned strike by members of Cosatu and other organisations is yet another indication of the ever-widening disconnect between the ANC-led government, organised labour and the people of South Africa. We are told that it will be the largest strike ever in the country. Tomorrow, 32 marches are planned to take place, effectively grinding business to a halt, with an estimated opportunity cost to our economy of over R8 billion.
Why does the ANC-led government no longer listen to the voice of the people of South Africa? Why does the ANC-led government continue to push policy and legislation that are contrary to the will of the people? Yesterday, Minister Radebe talked about ANC policy which would ensure a better life for all. [Interjections.] However, tomorrow’s strike action remains what it is and will be: another scathing indictment of the way in which the ANC-led government is continuing to fail the people of this country. [Applause.]
PUBLIC VIOLENCE IN UMLAZI, KWAZULU-NATAL
(Member’s Statement)
Ms J E SOSIBO (ANC): Mr Speaker, the ANC is deeply concerned about the recent public violence between supporters of the IFP and the NFP in T-section, Umlazi. This outbreak, which has claimed the lives of two people and led to 30 houses and several businesses being set alight in Umlazi, KwaZulu-Natal, illustrates the lack of tolerance shown by supporters of these political parties. Even though there is no great clarity on the reason for the violent flare-ups, provocation and the singing of songs vilifying the respective parties cannot be condoned. Such intolerance works against the kind of country we want to build and brings back visions of the violence that ravaged the province in the late 1980s.
However, it is encouraging to see the two leaders of the political parties involved speaking to their supporters, denouncing the violence and calling for calm. The main challenge now is to deal with the damaged houses and displaced people. The ANC calls on the parties involved to end the violence and respect the views of their opponents. [Applause.]
FLAWED RESTRUCTURING PROCESS IN DEPARTMENT OF EDUCATION IN KWAZULU-NATAL
(Member’s Statement)
Mr R B BHOOLA (MF): Mr Speaker, in the past year the KwaZulu-Natal department of education, under the leadership of MEC Senzo Mchunu, engaged in a restructuring process consisting of the restructuring of employees in service centres. However, the current process is flawed. The terms and conditions of service are being amended and employees are being coerced into moving from one post to another. This is a gross violation of people’s rights and there is a general state of dissatisfaction among employees at the head office service centre and district offices. What is happening is unlawful and must be corrected with immediate effect. Amending employees’ terms and conditions of service requires a collective agreement by the Public Service Co-ordinating Bargaining Council and Sectoral Council.
The MF is extremely concerned, given the absence of such a collective agreement. Will the hon Minister explain why employees’ terms and conditions of service are being amended outside the provisions of the Labour Relations Act and the Bargaining Council? The MF requests the hon Minister’s intervention to stop this process of restructuring and to direct it to the Bargaining Council so that there will be harmony and consensus. This would enhance the quality and raise the levels of service delivery and good governance within the department of education in KwaZulu-Natal.
REAPPOINTMENT OF DISMISSED BITOU MUNICIPAL MANAGER AT SUNDAYS RIVER VALLEY LOCAL MUNICIPALITY
(Member’s Statement)
Mrs A T LOVEMORE (DA): Mr Speaker, poor South Africans lose out on service delivery opportunities when corrupt officials are redeployed and effectively given new opportunities to pilfer public funds. The DA condemns yesterday’s decision by the Sundays River Valley Local Municipality Council to appoint the dismissed Bitou municipal manager to the position municipal manager of the Sundays River Valley.
This new incumbent was dismissed last month from his previous position at the Bitou Local Municipality because he was found guilty of four counts of financial misconduct. It is astounding that somebody found guilty of financial misconduct could be employed ... [Interjections.]
HON MEMBERS: It’s shocking! [Interjections.]
The SPEAKER: Order!
Mrs A T LOVEMORE (DA): ... in a senior management position at another municipality. The DA believes that this appointment falls foul of section 57(1)(a) of the Local Government: Municipal Systems Amendment Act, Act No 7 of 2011, which prohibits the re-employment of staff members dismissed for financial misconduct in any municipality for a period of 10 years.
I urge the Minister for Co-operative Governance and Traditional Affairs to take immediate action to suspend the incumbent until the department has been able to establish the legality of this appointment and to set a timeframe for the resolution of this matter.
If the redeployment of corrupt officials is allowed to continue unchecked, local government will collapse under the weight of maladministration, corruption and mismanagement, service delivery will continue to be disrupted and poor communities will continue to be denied basic services. [Applause.]
WELCOMING WOMEN’S CONSTRUCTION FLAGSHIP PROJECT AT PORT ST JOHNS
(Member’s Statement)
Mr F BHENGU (ANC): Nalu uluvo Somlomo. [Here is an idea, hon Speaker.]
To quote from the National Development Plan:
We know what we do and how we do it is as important as what we want to achieve. What we are is because of who we have been and what we want to become.
The rural women, children and people with disabilities of Port St Johns in the Eastern Cape welcome the Women’s Construction Flagship Project launched by the Minister at Caguba on Saturday, 11 February 2012. The sod-turning by the Minister was the precursor to the construction of the women’s income-generating multipurpose centre. This also encompasses skills development projects, a children’s park, recreational facilities and a memorial hall.
The broader community of Port St Johns acknowledges, in unison and with gratitude and humility, this initiative by the ANC-led government because it highlights and addresses the triple challenges of unemployment, poverty and inequality. This further epitomises the department’s firm purpose to roll out various rural empowerment and development programmes targeting the governments’ New Growth Path. The ANC applauds this ground-breaking enterprise.
Bathi bayabonga. [Ihlombe.] [They say they are grateful. [Applause.]]
CORRUPTION IN MUNICIPALITIES A THREAT TO OUR DEMOCRACY
(Member’s Statement)
Mr B W DHLAMINI (IFP): Mr Speaker, during the debate on the state of the nation address, the president of the IFP expressed his concern about the level of corruption in our country when he said, and I quote: “Corruption is the bane of our country. It is a fundamental threat to our constitutional democracy.”
Indeed, corruption has become endemic in our society, especially in our municipalities, where the cancer of corruption is spreading. In the latest scandal the Steve Tshwete Local Municipality in Mpumalanga sold a piece of land to a company. On the same day, the company in question sold that piece of land to a developer, making a R1,6 billion profit. It is clear that this was no ordinary transaction. The deal smacks of corruption.
The routine cronyism in our municipalities cannot go on. Cronyism, corruption and ineptitude in municipalities around the country are at crisis levels and has left many municipalities unable to fulfil their basic functions. In many ways - too many, I dare say - the overwhelming majority of people are trying to make money from holding public office, being in politics or exercising public power. This practice must be stopped. We must intensify our fight against corruption and stop office-bearers in municipalities from engaging in dodgy deals and plundering the public purse.
INABILITY OF DEFENCE FORCE TO SECURE OUR BORDERS
(Member’s Statement)
Mr W M MADISHA (Cope): Mr Speaker, Cope notes that the Minister of Defence admitted last week in this House that her department had no capacity to secure the borders of our country. The serious implication of her admission should be more closely scrutinised, since the inability of the Defence Force to secure our boundaries has a major impact on national security, food security and the need for developing a strong emerging-farmer sector in South Africa.
A recent site visit to Kosi Bay border post revealed that border control is in a shambles in this country. This was evident from a glaring gap in the fence right next to the control post. This allows a free flow of people and their livestock from Mozambique to South Africa and back again. It came as a shock that there was free movement without any passport control at the popular Gate 6. More than 12 access gates are wide open. Our country is a country without a yard. A free flow of livestock carries the risk of foot-and-mouth disease in poor farming communities, with implications for the export of meat products. Consequently, we will see a decline in income from trade and industry.
All this is notwithstanding the outstanding and gallant efforts by the Minister of Home Affairs to clean up our border posts and clean up corrupt officials. It is clear that illegal immigrants are moving freely in and out of our country at border posts — which does not mean it is free. Some are paying significant bribes to do that.
It is clear that we will never root out foot-and-mouth disease and stop illegal trade, even human trafficking, if the Defence Force is not capacitated to do their work. It seems that ordinary South Africans who survive through livestock and agriculture ... [Time expired.]
DESIGN AND DEVELOPMENT OF DIGITAL DRUM BY CSIR
(Member’s Statement)
Ms A Z NDLAZI (ANC): Mr Speaker, we wish to congratulate the Council for Scientific and Industrial Research, CSIR, on its central role in the design and development of the Digital Drum. The CSIR has been recognised in Time magazine’s January 2012 issue. Time is the world’s largest weekly magazine.
The Digital Drum is a computer system that gives people access to information on relevant issues like health and education. This innovative system is based on the CSIR’s Discovery Doorway, a robust, standalone computer system that promotes computer literacy. The Digital Doorway initiative is funded by the Department of Science and Technology.
The CSIR team was tasked to come up with an ICT intervention in Uganda, using local materials in simplified housing. Since oil drums were readily available, they were used as the basis for the new housing. The Digital Drum has two work stations, with content adapted from the standard Digital Doorway suite. The original prototype is on display at the Cooper–Hewitt National Design Museum in New York, together with a later version of the Digital Drum, which uses a second oil drum as a stand.
This recognition is valuable encouragement to our scientists who are working to find innovative solutions to societal problems and advance knowledge-based economic development on the continent.
JOBS IN COMMUNITY PROJECTS IN PROTEA SOUTH GOING TO ANC MEMBERS ONLY
(Member’s Statement)
Mr J R B LORIMER (DA): Mr Speaker, last Wednesday, Deputy President Kgalema Motlanthe told this House that where jobs on community projects were handed out to ANC members only, he would intervene. The next morning at 9 o’clock, I delivered a letter to his office explaining a situation in my constituency in Protea South in Soweto and asking him for help. That community is in conflict because a road-upgrading project initiated by the DA proportional representative councillor has been hijacked by the ANC ward councillor, who is giving jobs to card-carrying ANC members only. [Interjections.] One DA member who applied for a job was told by the ANC councillor, “Go and ask Helen Zille.” Everyone deserves a fair chance of obtaining work opportunities in community projects. Political affiliation should not be a consideration.
It’s been almost a week since I delivered my letter and still no response from the Deputy President. Will the Deputy President intervene to ensure an impartial process in Protea South and follow that up with instructions to his party across the country to treat all the people equally, rather than just hand out patronage, or will the Deputy President ignore my request?
The ruling party would have us believe that we have achieved government by the people, for the people, but the available evidence shows merely government by cronies, for cronies. [Applause.]
STATE-OWNED PHARMACEUTICAL MANUFACTURING PLANT IN SOUTH AFRICA
(Member’s Statement)
Mr E N N NGCOBO (ANC): Mr Speaker, we congratulate the Departments of Science and Technology, Trade and Industry, Economic Development, Health and Energy on their announcement of the development of a joint venture with Pelchem (Pty) Ltd and a leading Swiss pharmaceutical company, Lonza Limited, on 10 February 2012. The joint venture, named Ketlaphela, will establish the first pharmaceutical plants to manufacture active pharmaceutical ingredients, known as APIs, for antiretroviral medicines. Ketlaphela is a Sesotho word meaning “I will live” or “I will survive”. Ketlaphela will be a truly South African company with a significant government-ownership component through Pelchem and the Industrial Development Corporation, IDC.
Pelchem, a South African state-owned company, is a leading speciality chemicals manufacturer and the sole producer of fluorochemicals. Its Fluorochemicals Expansion Initiative is a partnership initiative with the Departments of Trade and Industry, and Science and Technology. Lonza is one of the world’s leading suppliers to the pharmaceutical, health-care and life-science industries. Its headquarters is in Basel, Switzerland. The company has strong capabilities in large and small molecules, peptides, amino acids and niche bioproducts, which play an important role in the development of novel medicines and health-care products. Furthermore, the company is a leading provider of value chemical and biotechnology ingredients to the nutrition and agromarkets.
We believe that this venture will be directly in line with government’s commitment to job creation and poverty alleviation through infrastructure development. The venture will create jobs and bring millions of rands to South Africa. [Time expired.] [Applause.]
REAPPOINTMENT OF DISMISSED BITOU MUNICIPAL MANAGER AT SUNDAYS RIVER VALLEY LOCAL MUNICIPALITY
(Minister’s Response)
The MINISTER FOR CO-OPERATIVE GOVERNANCE AND TRADITIONAL AFFAIRS: Thank you very much, Mr Speaker. We note the allegations that were raised about the appointment of a municipal manager at the Sundays River Valley Local Municipality. I want to undertake to investigate that matter and deal with it in accordance with the merits. I also want to call on the hon member who raised this allegation to work closely with us so that we get the necessary information.
We should put on record that we are saying so because as this government we are firm in our resolve to make sure that there is clean administration. In 2008, when we amended the Public Service Act, we wanted to provide for a mechanism in law to deal with issues like these at provincial and national levels. We will not fail at local government level. Thank you. [Applause.]
STATE-OWNED PHARMACEUTICAL MANUFACTURING PLANT IN SOUTH AFRICA
FIRST FREE OUTDOOR GYMNASIUM IN SOWETO
FLAWED RESTRUCTURING PROCESS IN DEPARTMENT OF EDUCATION IN KWAZULU-NATAL
(Minister’s Response)
The MINISTER OF HEALTH: Thank you, Mr Speaker. On the issue of the joint venture between Lonza and the state for a state-owned pharmaceutical company, we welcome the news about the Ketlaphela project. Hon member, we are very happy about that and believe the project should be accelerated.
On the issue of exercise, the outdoor gym in Soweto and the impact on non-communicable diseases, I am eagerly awaiting the day when there is a gym here in Parliament, used by hon members on a daily basis. I am eagerly waiting that day. [Interjections.] There should even be an attendance register for members who attend. You might not be aware that some medical aid companies know how important this is. One of them is Discovery, one of the biggest medical schemes in the country. They are linked with gymnasiums around the country. There is a card, which you use when you clock into the gym. It actually shows Discovery that you have been to the gym. As a result they reduce your premium because you are actually exercising and they know you will claim less money for health care because you will not have heart disease, high blood pressure or diabetes. This is very important. So, I am looking forward to Members of Parliament doing just that. We might have to ask your medical scheme, Parmed Medical Aid Scheme, to introduce that type of thing — where they reduce your premium if you clock in at a gymnasium.
I am answering the last question on behalf of the Minister of Basic Education, in response to the MF member who came with allegations concerning teachers whose conditions of service were being altered. If I understood him correctly, that was his complaint. I am sure by now he is painfully aware that no Minister or MEC can unilaterally alter anybody’s conditions of service. The labour laws of this country do not allow that.
What I think he is talking about is the issue of moving teachers because of teacher provisioning, scales and standards. This was agreed to in the chamber. It is not unilateral. It is done with the teacher unions and it is an annual thing. You calculate the provision of teachers in terms of the learner-to-educator ratio and then some teachers have to move. I must say that, while this has been accepted even in the chamber, teachers sometimes do not agree with having to move because it might not be nice for them. That does not mean the MEC is going against any law. What he is doing is perfectly legal and the Minister of Basic Education mentioned — it was even in the newspapers — that teachers needed to go and work where they were needed, not where they wanted to work. They must go where the students are. [Applause.]
The SPEAKER: Thank you very much, hon Minister. I am reliably informed that, in fact, there were two gyms here after 1994, one for men and another for women. The one for men has fallen into disuse — it was never used — while the one for women is still functioning. [Interjections.]
SUPPORT FOR COSATU’S MARCH AGAINST E-TOLLING IN GAUTENG
(Minister’s Response)
The DEPUTY MINISTER OF TRANSPORT: The hon Kganare predictably and opportunistically jumped onto the bandwagon of Cosatu’s strikes tomorrow. You know, even the DA was invited by Cosatu here in the Western Cape to join the strike. Cope was not invited — shame! I understand why you feel so agitated about this matter. [Laughter.] What the hon member does not tell us is that this project, the e-tolling in Gauteng — which, we are the first to concede, is a problematic project — was pioneered by a Cope member. Is he still a Cope member? I am never sure about these things! It was Mbhazima Shilowa, during the time when he was the premier of the province. [Interjections.]
Now, in this administration, if we could rewind the clock — of course we can’t, but if we could — we would certainly think three or four times about the advisability of proceeding with this very costly project, which does not have a strong developmental character to it. However, it is there — or part of it is there. We have spent R20 billion. We now have debt of R20 billion. What the hon member does not tell us is how we are going to deal with that debt. [Interjections.] What we have tried to do — I will now tell you how we are going to deal with it — is that we have listened to the public. We have reduced the e-tolling for light vehicles ... [Interjections.] ... from 60 cents to 30 cents. The Minister of Finance has put in a whopping R5,57 billion, which came out of the fiscus, to reduce the debt by more than a quarter. There is a R550 cap for e-tagged vehicles per month. There is time-of-day reduction for heavy vehicles to encourage them to use it off-peak. Public transport vehicles, buses and minibuses are totally exempted from any e-tolling.
Now what we are being told perpetually is that this is going to hit the poor. However, in a recent count of vehicles on the system only 2% of the vehicles were in fact minibuses and buses — in other words, transport that is used by the working-class poor. A recent study by an academic said that 98% of the toll load would be carried by middle-class and rich spenders. So, this is how we are trying to deal with the debt. We have learnt a strong lesson, as the Minister of Transport and the Minister of Finance have correctly said about this matter. This is exactly why we now have a presidential infrastructure co-ordinating Commission — it will carefully assess what we spend infrastructure money on, so that we prioritise correctly. What the DA is suggesting is that we should increase the fuel levy, which means that everyone — all drivers throughout South Africa — would have to pay a debt for roads used by the people of Gauteng. [Interjections.] [Time expired.]
CHAOTIC PROCESS OF SOCIAL GRANT REREGISTRATION
(Minister’s Response)
The DEPUTY MINISTER OF SOCIAL DEVELOPMENT: Ngiyabonga, Mhlali ngaphambili. [Thank you, Chairperson.] Phase one of the registration process only started on 1 March 2012. The first phase is to register new people on Cash Paymaster Services, CPS, and they are supposed to bring their IDs and Sekunjalo cards.
Secondly, not all the provinces are affected by the reregistration. For instance, the North West, the Northern Cape, KwaZulu-Natal, part of the Western Cape and Limpopo are not affected. The provinces that are most affected are parts of the Eastern Cape, Gauteng, parts of the Western Cape, the Free State and Mpumalanga.
Lastly, we are on all the local radio stations, outlining the process of reregistration. We will also use local newspapers and we will be at pay points to check that everything happens according to plan. The work will continue. Phase two will start in April, and phase three will start in June.
With regard to ill treatment, the SA Social Security Agency, Sassa, takes its service to its beneficiaries seriously and does not condone, in any way, the ill treatment of beneficiaries. Each Sassa region is empowered with a fully functional customer care unit, whose main focus is customer relations and upholding the Batho Pele values. Sassa has developed a customer care charter, which informs the public about the standard of services that can be expected from Sassa. Hon member, if there are problems at some pay points, please bring the information to us so that we can follow up.
Sengigcina, bazoba khona-ke nalabo abangafuni ukuthi kulungiswe, ngoba bengafuni ukuthi kuphele inkohlakalo. Sinabo shaqa. Sizosebenza sibhalise kabusha abantu ukuze sikwazi ukukhokhela abantu okufanele bakhokhelwe abaphilayo. Baningi abantu abangaphili abakhokhelwa u-Sassa.
Ngakho-ke sizowenza lo msebenzi wokulungisa ukuze kuphele inkohlakalo lapho kukhokhelwa khona imali yempesheli. Ngiyabonga. [Ihlombe.] (Translation of isiZulu paragraphs follows.)
[In conclusion, there will be those who do not want us to deal with corruption because they don’t want corruption to be eradicated. Woe unto them. We will do our work and reregister people so that we can pay the rightful beneficiaries who are alive. Sassa has paid many people whom we have since discovered are deceased.
Therefore, we are going to deal with corruption so that it can come to an end at the pension pay points. Thank you. [Applause.]]
INABILITY OF DEFENCE FORCE TO SECURE OUR BORDERS
(Minister’s Response)
The MINISTER OF WATER AND ENVIRONMENTAL AFFAIRS (On behalf of the Minister of Defence and Military Veterans): Mr Speaker, I rise to deal with the question that was addressed to the Minister of Defence and Military Veterans, who is not here.
First of all, I would like to indicate that it is the Minister of Defence and Military Veterans and the cluster in this ANC-led government that deemed it necessary for the SA National Defence Force, SANDF, to go back to the borders of this country to ensure that we tighten security in this country. It is not because of a statement made on the other side. It is a vision of this government. It is the same Minister who actually went to Treasury and, within the collective, found resources. She then stood in front of this House last week to indicate that yes, she had limited resources. She does have resources, but they are limited. She did not say that she did not have that capacity we are talking about now, but that she had limited resources. She also indicated that she has begun, with the departments, incrementally to build on this and ensure that there is up-to-scratch security at our borders.
She also went on to say that, in fact, there is improvement already. She cited some of the achievements already, which are related to the fact that the return of the army and the soldiers to the South Africa-Mozambique border has actually led to the arrest of some of the people who have been poaching our rhinos. So, I just thought that the hon member should be aware of that and not mislead the House. The Minister is moving in that direction. In fact, she has also been talking to Treasury, within the collective, incrementally to get those resources, because we do know that there are resources, but they are limited. We further know that she is restructuring and working incrementally on that challenge, which we ourselves are aware of.
Thank you very much to colleagues who have recognised the fact that the ANC does deliver: a new antiretroviral manufacturing plant, a new development for people with disabilities in our country in our lifetime ... [Time expired.] [Applause.]
FLAWED RESTRUCTURING PROCESS IN DEPARTMENT OF EDUCATION IN KWAZULU-NATAL
(Minister’s Response)
The MINISTER FOR THE PUBLIC SERVICE AND ADMINISTRATION (On behalf of the Minister of Basic Education): Mr Speaker, I respond to the concerns expressed by the hon Bhoola, who raised criticisms about the transfer of employees in the education department in KwaZulu-Natal. He specifically mentioned MEC Senzo Mchunu.
I can’t imagine that the MEC concerned would be acting illegally, unlawfully and unprocedurally, as the hon Bhoola has alleged. I know that the Public Service Regulations allow the Ministers and MECs to transfer employees from one department to another, but in this case I think it is a question of the redeployment of teachers to schools where they are needed. However, let me say that I welcome the suggestion by hon Bhoola that we must look into the matter. I will investigate it and invite him to engage with me on the matter.
CONSIDERATION OF FISCAL FRAMEWORK AND REVENUE PROPOSALS AND OF REPORT OF STANDING COMMITTEE ON FINANCE THEREON
Mr T A MUFAMADI: Mr Speaker, hon Minister of Finance, Ministers and Deputy Ministers present, hon members and distinguished guests, let me add mine to the many voices of South Africans congratulating the Minister and his team for tabling a credible, broadly balanced and confidence-building Budget statement in this House. It has indeed given clear policy direction that is certain, predictable and coherent.
In his state of the nation address the President of the Republic reminded us, and I quote:
The work done last year indicates that if we continue to grow reasonably well, we will begin to write a new story about South Africa — the story of how, by working together, we drove back unemployment and reduced economic inequality and poverty.
The President also said:
Our shared commitment is to put South Africans to work. They must find work in the fields and factories, in repairing roads and building houses, in caring for children and protecting the environment. We must create jobs in every possible way that we can. 2012 must be the year of job creation.
The Budget, as presented in this House by the Minister of Finance, consists of the objectives stated above as it continues to open up a range of new possibilities for growth and development in line with the President’s call and invitation to the nation to join his government in the industrialisation programme of our country through the infrastructure development drive. Hon Minister, you are indeed very correct when you said, and I quote:
It is a story that must be written by all of us ... not just by government ... not just by unions ... South Africans from all corners of this country.
Each one of us must play a role to advance our democracy beyond its second decade of existence. We have just begun a long journey to realise a true and united nonracial, nonsexist, democratic and prosperous South Africa.
It is my pleasure to table the committee report and its recommendation on the 2012-13 fiscal framework and revenue proposals for consideration and adoption by this House, as directed by section 8(3) of the Money Bills Act.
In the main, the economic policy focuses on matters that relate to the national economic outlook and performance and key macroeconomic indicators within the current national, regional and indeed international and global economic environment, while the Fiscal Policy Framework deals with the fiscal stance adopted by government. It will give effect to the macroeconomic policy for the 2012-13 financial year and, among others, includes in the main estimates of all revenue — budgetary and extrabudgetary specified separately — of all expenditure expected to be raised during the financial year; estimates of borrowing for the financial year; and estimates of interest and debt servicing charges.
It is evident and clear that the 2012 Budget, as presented to us as the committee and after extensive consultation with various stakeholders through public hearings and intense interrogation by the committee, gives effect to the stance outlined in the 2011 Medium-Term Budget Policy Statement. It sets out a fiscal framework that will narrow the gap between spending and revenue, support the economy, strengthen capital investment and improve the performance of the Public Service. Spending over the next three years will be shifted from consumption spending towards productive investment, particularly in infrastructure development.
The macroeconomic framework continues to embrace a countercyclical fiscal policy and monetary policies that are underpinned by inflation-targeting measures that support growth and investment to protect the living standards, particularly of working families, the poor and low-income households. The macroeconomic measures alone are not enough. They need to be complemented by trade support, competition policy and active labour market measures.
The Budget, as presented, reaffirms the correctness of the countercyclical fiscal policy stance, which has provided a very strong and solid base in the past few years. These policies have ensured that even under very difficult circumstances due to, among other factors, the virtual collapse of the economies of our major trading partners in developed economies, particularly in Europe, we have succeeded in maintaining a low budget deficit of 4,8% of the gross domestic product, GDP. This is projected to stabilise at around 3% by the year 2014. We also managed to stabilise our debt to GDP at 38% and our tax revenue continues to recover. It is projected to increase from 24,7% to 25,5% of the GDP.
Furthermore, the Budget signals a new impetus in public sector investment, which is a foundation for long-term growth, employment and development through expansionary infrastructure plans.
The gains and consolidation of our Budget successes through prudent fiscal management of our resources is cause for celebration and a lesson to be taught not only to emerging economies but also one to be learnt by the developed world. It is our home-grown product to be exported. For this we must pay tribute to the National Treasury and the executive, particularly the Budget committee in the Cabinet.
As the President said in the state of the nation address, it is beginning to look possible and we must not lose this momentum. This Budget continues to give hope to and inspire confidence in millions of South Africans. Under these conditions we can safely say yes, it is possible to pursue and succeed in industrialising our economy, improving our trade performance and maintaining moderation in consumption spending.
The National Planning Commission’s proposed National Development Plan recommends several policy options to improve labour market efficiency to speed up job creation. These include placement subsidies to get matric graduates into work, staff retention schemes that offer short-time work during periods of low demand, and a more open approach to skilled immigration to boost the supply of high-skilled workers in the short-term.
The good of any policy is in its implementation and the achievement of its intended objectives. In other words, laws are good to the extent that they make a difference to those they are intended to benefit. I’m raising this precisely because consultation in the implementation of our laws should not lead to paralysis, particularly for the Budget and programmes that this House voted on and passed. The envisaged improvements in labour market efficiency, as espoused in the National Development Plan, should lay a firm basis for constructive discussions to seek agreement on the long-outstanding proposals to facilitate youth employment. The resolution and implementation of such proposals should complement the positive signs of an improved labour market in the previous year, when a significant number of jobs were created in both the formal and private sector.
The economy is projected to add 850 000 new jobs over the following three years. What is even more exciting is that 80% of these will be in the private sector, which will contribute to the lowering of unemployment to about 23% by 2014. Most of these jobs are also likely to be concentrated in the service and construction sectors as a result of steady growth in domestic demand, infrastructure expenditure and the pick-up in residential investment that is expected during the outer years of the budget.
What are the features of the Fiscal Framework? South Africa’s period of transition is about building modern infrastructure, a vibrant economy, a decent quality of life for all, reducing poverty and creating decent employment opportunities for our people.
The committee notes that over the medium term, slower growth in public spending, combined with rising revenue, will substantially strengthen the fiscus. Therefore the key features of the fiscal outlook include the following: real growth in noninterest expenditure averaging 2,6% over the medium term; additional allocations of R55,9 billion over the next three years, including R9,5 billion for an economic support packages; tax revenue levels stabilising at about one-quarter of the GDP; and a shift from consumption to capital spending so that, from 2014/15, new borrowing will support productive investment.
The committee also notes that in the last 10 years structural increases in revenue were supported by healthy economic growth during the mid-2000s, along with improved tax compliance and administration. Audited revenue results show that the tax revenue of R674,2 billion for the 2010-11 fiscal year was an increase of R75,5 billion — 12,6% higher than anticipated in terms of the Medium-Term Budget Policy Statement. We also note the improvement made on personal income tax, dividend withholding tax, capital gains tax and the medical credit tax.
South Africa’s critical infrastructure needs are, in part, the outcome of over 40 years of underinvestment and neglect. Public infrastructure spending tailed off from the early 1980s. Prudent fiscal management of the economy has created the much-needed fiscal space for a long-term investment plan. Together with the private sector, we can make a difference. It is now possible to emulate the developed countries, that spend about 25% of their gross domestic product, GDP, on capital investment, which is substantially needed to raise the per capita income of households.
The infrastructure budget, as tabled in this House, is beginning to fall in line with other developing countries whose capital investment is equal to about 25% of their GDP. While infrastructure spending and development is critical for economic growth, we must bear in mind that it should do so to underpin the manufacturing and beneficiation sector in our economy. It should do so to promote primary commodities, local input and the manufacturing sector. In other words, as we welcome the spending plans in respect of improving rail and general transport infrastructure, this should not lead to the promotion of exports of primary commodities without supporting the secondary sector of our economy. It is in this regard that the committee made certain observations and recommendations when it sat on Friday, which I will not spend time on in this presentation. Therefore, I wish to indicate that the committee, after it considered the 2012 fiscal framework and revenue proposals and conducted public hearings, proposes, recommends that the House adopts the 2012 Fiscal Framework and Revenue Proposals. The ANC supports the proposals as tabled. [Applause.]
Mr T D HARRIS: Mr Speaker, the Minister has now tabled three Budgets in extremely challenging global conditions. That our country remains fiscally resilient is acredit to the millions of South Africans who work to keep this economy going and to our well-managed national accounting system.
The DA welcomes the fact that, within this Fiscal Framework, there is a focus on public infrastructure investment. This was neglected by the former Finance Minister, who oversaw 10 years of inadequate public expenditure on infrastructure between 1996 and 2006. We welcome the stated commitment to fighting corruption and fixing procurement, and we welcome Treasury’s new flexibility on tax incentives for special economic zones.
Overall, we support the Minister’s vision of building a capable state, but we fear that this vision will continue to be ideologically undermined by Cosatu, compromised by deployed cadres, and eventually drowned in regulation imposed by various Ministers, each eager to intervene in the economy in a totally unco-ordinated way. [Interjections.]
HON MEMBERS: Hear! Hear!
Mr T D HARRIS: The reduction in the Budget deficit is positive news, although the ratings agency Moody’s has pointed out:
This achievement was derived partly from a continuing inability to spend a large share of the investment budget, which is detrimental to the economy’s growth potential.
This inability to spend is perhaps the reason why, as a percentage of the GDP, infrastructure spending for 2012 will actually be lower than what the Minister forecast this time last year. The Minister should tackle skills shortages in the Public Service, the mountain of regulations that delay projects and ANC cadre deployment before raising hopes that we will be able to spend more to tackle our R1,5 trillion infrastructure backlog identified by the Department of Public Enterprises.
The chairperson of the Portfolio Committee on Finance reminds us that 2011 was meant to be “the year of the job”. Yet at the end of that year we had 107 000 more unemployed young people in this country than at the beginning of that year. This is primarily because of Cosatu’s opposition to reform and resistance to enlightened policies like the youth wage subsidy. The question is: If 2012 is meant to be “the year of infrastructure”, how will we get beyond the capacity constraints in government to build this infrastructure?
One obvious solution to improve project management and fill funding gaps is to mobilise private sector capacity, as promised by the Minister in his Budget Speech. But someone will need to tell the Minister of Public Enterprises, Malusi Gigaba, because he poured ice on this proposal when he said two weeks ago that “the debate on port concessioning has not been settled”. They should also talk to Mr Brian Molefe, the chief executive officer of Transnet, who said: “There is no role for the private sector in the main channels of rail infrastructure.”
Attitudes like these in government perhaps explain why our use of public-private partnerships is among the lowest in the world, at around 4% of infrastructure spending. It may also explain why we persist in bailing out failing parastatals like our state arms manufacturer, Denel, and our state diamond mine, Alexkor, who together get more than R1 billion in this Budget.
We should send Minister Gigaba and Mr Molefe to Brazil. When they get there, they will land at an airport in São Paolo, which last month sold a 51% stake to investors for the equivalent of R70 billion. This is a quarter of the total amount that South Africa is meant to spend on infrastructure this year. We could certainly use this sort of money.
Last week, Moody’s also said that Treasury’s debt stabilisation programme relied on compressing the growth in the wage bill, something they did not believe would happen. [Interjections.] They are also concerned about future revenue, considering that the Minister this year ratcheted up dividends tax and capital gains tax – probably the last loads he could add to the taxation scales without tipping South Africans from “heavily taxed” to “totally overtaxed”.
New tolls and increases in administered prices are already too much for our economy. Imposing carbon tax and a local business tax and VAT, or payroll or income tax increases to pay for the National Health Insurance will push us over the edge and do serious damage to our culture of taxpaying in South Africa. When that happens, you start to look like Greece.
Instead of speculating on what new taxes to impose, this Budget should have boosted potential tax revenue by doing more to drive growth in South Africa. If we accelerate growth from the anaemic 2,7% forecast for this year to the 8% targeted by the DA, we would double the size of our economy and our tax revenue in 10 years. But to start down this path, the Minister should have provided a real growth narrative in this Budget. For example, his counterpart in India, Minister Mukherjee, recently called GDP growth of 6,9% in India “disappointing” and said that his budget would provide “a roadmap for achieving a higher growth trajectory”. In Brazil, Finance Minister Mantega said in his budget speech that “Brazil has the ability to grow faster. The budget we are implementing will make vigorous growth in Brazil possible.”
Where were these sentiments in our Budget? What we needed was a detailed plan to drive faster growth by building a stakeholder economy – a South Africa where ordinary job seekers, workers and small business owners get a fair stake in our economy and a real shot at making it in a well-regulated market.
In the DA’s alternative budget, released just before the Budget Speech, we tabled proposals for tax breaks for small businesses to help with their cash-flow problems. We also tabled more generous tax provisions for employee share-ownership schemes. Most importantly, to help give 3,2 million young job seekers a stake in the labour market, we called on Treasury not to yield to Cosatu on the youth wage subsidy. The President announced this policy two years ago. It had R5 billion allocated to it by the Minister of Finance last year and it had an implementation date of 1 April this year. The fact that Cosatu has managed to block it at the National Economic Development and Labour Council, Nedlac, since May 2011 is a national disgrace.
An HON MEMBER: Hear! Hear!
Mr T D HARRIS: It raises serious questions about the Minister’s influence in government and undermines his intention to build a capable state and start rolling back unemployment in South Africa.
The DA supports this fiscal framework because of the Budget’s stated commitment to rebuilding the infrastructure of this country. However, if future budgets introduce huge new taxes, fail to target higher growth and continue to marginalise young job seekers, we will be unable to support them. [Applause.]
Mr N J J KOORNHOF: Mr Speaker, the Treasury and the Minister stuck to their previously announced intentions to proceed with the consolidation of state finances and we have seen a major shift in the composition of spending this year. The focus of the Budget is in the right place. This Treasury, under the guidance of the new director-general and the Minister, needs all the support they can get. Cope shall support the fiscal framework.
We are at a crossroads in terms of our state finances. That’s why we have seen a call in the Budget Speech by the Minister for a bit more patriotism. It’s a call to each one of us — the Public Service, unions, farmers and business — to do our little bit to secure the consolidation of state finances. The Minister got cum laude reports from most economists, but that does not mean we do not have some criticism.
I do not have time to dwell on the fuel levy, on the timing and short notice of the dividend and capital gains taxes, and on the insecurity of debt guarantees. With my remaining time, I want to address the behaviour of Cosatu and the dilemma of the increasing state wage bill. Hearing of Cosatu’s threats and demands, the assumption by the Treasury that they will keep the increase of the wage bill to around 5% becomes a very debatable issue. If this goes wrong, it can boomerang very negatively on all of us. Michael Lewis just published a book entitled Boomerang. If you want to know how a nation lost its financial mind, read this book. Everybody in this House should read this book, especially Cosatu. It tells the story of how Icelanders wanted to stop fishing and become investment bankers. The Greeks wanted to turn their country into a piñata stuffed with cash and allow many citizens to take a whack. The Irish wanted to stop being Irish, and the Germans to be even more German. [Interjections.] If we are not careful, in the second edition of his book, Michael Lewis will add a new chapter on how South Africans blew their GDP on a state wage bill.
Mr Speaker, when you throw a boomerang, you do not want it to change shape, colour, weight and direction in midair. This is what is happening in South Africa. The government constantly throws its boomerang, loaded with luxurious cars, flights, hotels, mismanagement and corruption, to the public and to Cosatu. The President carries on to employ the third-largest Cabinet in the world, with all the costs and perceptions that go with it. That is the wrong signal to give and because of that it is easy for Cosatu to take control of the boomerang in midair and return it as an unguided missile in the form of strikes and demands.
The government and the Treasury should concentrate on changing this message that they send to the public and the unions and be sure that they buy into this new message. The President should make his Cabinet smaller — that would send a strong message to Cosatu. The Cabinet should freeze all increases in the salaries of Ministers, Deputy Ministers and their directors-general for the next three years. They did it in the UK. It will shrink the gap between the MPs and Ministers. Government must stop filling vacancies in the Public Service that do not contribute to better service delivery — haircuts, haircuts, haircuts, hon Minister! If we fail to send a strong message, all the good intentions of this Budget will boomerang on all of us.
Mike Schussler reminded us all that we could save 10% of our GDP if we paid the Public Service the same salaries as the private sector. Due to Cosatu strikes against this government, more manpower days were lost in 2011 than during the hey day of apartheid. [Time expired.]
Dr M G ORIANI-AMBROSINI: Madam Deputy Speaker, I speak through you to the Minister. In previous debates, Minister, when I, on behalf of my party, expressed relevant concerns, you saw fit not to respond and to dismiss them on the basis of two grounds: on account of my nationality and on account of “ideological differences” between my party, or myself, and the ANC. On this occasion, Minister, I would like to point out how erroneous it is to refer to nationality. We would surely not do so in respect of your ethnicity when discussing matters of this nature. As for ideological differences, it sort of concerns us because, on our side, we have no ideology. We are pragmatists. In that statement, Minister, you suggest that you do have an ideology. That begs the question of what your ideology is. Perhaps this is what one may try to discern through the words and proposals of your Budget.
We are not opposing this Budget, because it is moving in a better direction. We appreciate the greater emphasis on and the greater allocations to capital expenditure at the expense of current expenditures. However, that takes place in an environment in which further growth is heavily subsidised by government. In a context in which we are expecting government-funded growth, this Budget begins to mark the merger between fiscal policy and industrial policy. Industrial policy is conceived and implemented within a strictly national context, to the exclusion of foreign competition or the real potential of international competitiveness. The Broad-based Black Economic Empowerment Bill will have such an effect, as will the special preferential procurement proceedings.
So, it is a Bill that extends the welfare state to industrialists, in the hope that they may employ people and one day may grow independent of the protections from international competition and the subsidies. In that sense, the Budget is a nationalist Budget and a socialist Budget. It is socialist because it extends the welfare state beyond the 18 million people already dependent on it to industrialists and all those employed by such industrialists, in conditions of noneconomic viability. That is the ideological concern that emerges. [Time expired.]
Mr S Z NTAPANE: Deputy Speaker and hon members, budgeting and its underlying fiscal framework is a difficult balancing act. As the expression goes, “Human desires are like the world of the dead - there is always room for more”. The unlimited needs and wants of the country must be accommodated in a limited budget. This constraint makes the process of budgeting particularly difficult. Accordingly, a careful thought process ought to go into what should constitute our nation’s priorities. In this regard, we are encouraged by the government’s seemingly renewed focus on infrastructure development. Infrastructure development is one of the many ways in which government can stimulate economic activity, create jobs and thus free our people from the yoke of poverty.
Disappointingly, many of government’s grand plans and bold visions have fallen dreadfully short of expectations, due to a poor or complete lack of implementation. According to government estimates in the 2010-11 fiscal year, only R178 billion was spent out of R260 billion set aside for infrastructure development. That is only 68%. Once again, this points to a glaring lack of government capacity to plan and implement the infrastructure development programme. The service delivery protests over the last few years are symptomatic of government’s failure to translate its grand plans and budget allocations into meaningful service delivery, putting further emphasis on the importance of aligning the fiscal framework with the needs of our people.
The UDM is concerned that motor vehicle owners who are reeling from the pressure of high crude oil prices face a 20c increase in the fuel levy on 1 April 2012. This taxation increases inflation in South Africa. The only justification for the fuel levy should be the need to maintain infrastructure — roads in particular. However, since government does not only use the fuel levy for road maintenance, it now also deems it fit to defend the indefensible conversion of the public into cash cows by introducing the e-tolling system in Gauteng to maintain the road infrastructure. [Time expired.]
Ms J TSHABALALA: Deputy Speaker, hon Minister, hon Deputy Minister, hon members, distinguished guests, we who are gathered here are beneficiaries of the freedom to which Mama Winkie Direko dedicated her life. We are the relay team to which she has handed the torch that she carried for so long. The race will continue until we have achieved a better life for all our people.
The legacy of apartheid policies in South Africa has created large disparities between racial groups in terms of socioeconomic status, occupation, education, housing and health. These policies have created a fragmented health system, which has resulted in inequitable access to health care. The inequities in health are reflected in the health status of the most vulnerable groups.
Hon Speaker, we are committed to a service delivery culture that puts every elected official and public servant to work for our people and ensure accountability to them and the democratically elected government. We remain in touch with our people and listen to their needs as reflected in the Bill of Rights in the Constitution.
The current global economic context is characterised by high levels of uncertainty. Against this background, South Africa’s development depends largely on government improving its level and quality of service delivery in support of the inclusive and equitable economic policy framework in the New Growth Path.
Let me emphasise the fact that, despite limited fiscal resources, the ANC-led government provides a safety net for nearly one-third of the population through the social grants programme. Contributory social security reforms and the rolling out of the National Health Insurance programme are measures to boost job creation, living conditions, the working environment and a broader social wage for our people.
An important aspect of a successful developmental state is investment in public sector workers and, in turn, our people expect public sector workers to execute the task which they have been entrusted with. This means that adequate numbers of personnel should be placed in the correct positions and where it is not the case, government should have the capacity to implement corrective measures, either through training or redeployment, if warranted.
The ANC-led government has taken the decision that we should do more to grow the country’s economy in order to eradicate the problems of unemployment, poverty and inequality in South Africa. The commitment of this administration to social security is a living reality of this. Social security is an essential constitutional right if we are to build a society which is cohesive, more equal and values human dignity.
South Africa is faced with the triple challenge of unemployment, poverty and inequality. Africans, women and the youth continue to suffer most because of these challenges. The ANC-led government remains committed to fighting the triple scourge of unemployment, poverty and inequality.
Hezwo ndi zwithu zwine ra ?o sedzana nazwo thwii, nga hoyu ?waha na mi?waha i?aho. [These are the things we will be focusing on directly this year and in the years to come.]
Decent work provides dignity; it provides security for a family and allows people to contribute towards the social protection system. The state prepares an enabling environment for economic growth and the development of state, private and social capital sectors by providing enablers and removing obstacles.
The ANC-led government has alleviated poverty on a short-term basis through the Expanded Public Works Programme, which provides short-term jobs and skills. It has also supported about 15 million South Africans, of whom 10 million are children, through social grants.
We have an effective social security system. Many households would have no food if it were not for the social grants. We are improving the economic situation and continue to work towards building bridges between the transition from social security to meaningful and decent work.
The social assistance programme is the ANC-led government’s most direct means of combating poverty. By the end of 2011, nearly 15,3 million people were eligible for social grants, from 2,5 million in 1998. Although grants are targeted to assist potentially vulnerable members of society — the young, old and disabled — more than half of households benefit from social assistance.
The social grant system has been expanded by extending the age limit for child grants to the child’s 18th birthday. The elderly, like other vulnerable groups, have been neglected by an uncaring apartheid governing system. Elderly Africans, particularly those in rural areas, continue to suffer even more. A higher old-age grant for those over 75 was introduced in 2011, and the means test threshold for the old-age grant and disability grant was increased significantly in the same year. In 2012-13, R104,9 billion is allocated to social assistance, rising to R122 billion in 2014-15. The number of grant recipients is set to rise from 15,6 million in 2011-12 to 16,8 million in 2014-15.
Achieving an appropriate level of funding for the National Health Insurance is necessary to ensure that the tax structure remains supportive of economic growth, job creation and savings. The National Health Insurance will be phased in over a 14-year period, beginning in 2012-13.
The new system will provide equitable health coverage for and accessibility to all South Africans. Over time, the new system will require funding over and above current budget allocations to public health. It is expected that an additional revenue source amounting to R6 billion will be needed in the year 2014-15, which is not currently budgeted for in the Medium-Term Expenditure Framework.
Employment is the most effective route out of poverty and boosting long-term job creation remains an overriding objective of economic policy. Over the short-term period, the ANC-led government has provided temporary work through the Expanded Public Works Programme and related initiatives.
Public employment services help job seekers to find jobs and training. Further education and skills development programmes are intended to bolster higher employment and productivity. Job creation has to be complemented by a well-designed social insurance framework, both as protection against unemployment and income vulnerability, as part of the broader social wage.
Reforming social security and health care and the way these are financed presents an opportunity to improve the scope and fairness of social expenditure. As in the envisaged design of social security arrangements, the principle of social solidarity lies at the heart of health reform and the national health insurance will extend to everyone.
I would like to draw the attention of this House to the relationship between social security and the broader global crises, specifically the European sovereign debt crisis. In times of economic crisis, priorities normally shift and countries move to defend their own economies from the fall-out.
The economic and financial crisis has placed social insurance systems under pressure. The crisis also challenges the financing of social security systems. However, financial pressure is stronger on systems that rely heavily on contributions and not taxes, thus generating new debates on how best to finance social security systems.
The Freedom Charter commits us to a preventive health scheme run by the state, free medical care and hospitalisation provided for all, with special care for mothers and young children. There have been achievements in improving access to health care. However, much more needs to be done in terms of the quality of care, making services available to all South Africans and ensuring better health care outcomes. The ANC-led government has seriously embarked on the reduction of inequalities in our health system, improving the quality of care in public facilities, boosting the capacity of our human resources and stepping up the fight against HIV and Aids and other diseases. Health reforms involve the mobilisation of available resources in both the private and public health sectors to ensure improved health outcomes for all South Africans.
In this, the centenary year of the ANC, the President of the Republic, President Jacob Zuma, is honouring the legacy of the liberation movement by ensuring that we are on the path towards economic and social justice, where all will be free from the indignity of poverty. Our goal is very clear: we want to have a country where millions more South Africans have decent work, greater employment opportunities, modern infrastructure and a vibrant economy in which the quality of life is high. Together we have the responsibility to work hard to make this a reality. Government alone cannot solve the challenges faced by the country, but working together, solutions are possible. We know well that if we work alone, none of us can achieve any success. We must, therefore, act together as a united people.
Yo fhedza khomba ya Madzinga. ?ala dza vhathu. Aa! [U fhululedza.] [I have finished. Thank you. Salute! [Applause.]]
Mr S N SWART: Madam Deputy Speaker, the ACDP wishes to commend the Minister and National Treasury on a Budget that was broadly well received by most sectors of society. We fully support its main thrust, which is about galvanising society behind a national effort to place the country on an investment-led growth path. This major shift from consumption spending to spending on the production side of the economy is significant and is to be welcomed.
At the same time, the Minister has remained committed to fiscal sustainability. We were pleasantly surprised at the decreasing Budget deficit, both for the current year and the next financial year. One wonders, hon Minister, what more one is required to do to satisfy certain ratings agencies.
The projected fiscal framework depends of course on a rise in revenue, coupled with economic growth as well as restrained government expenditure. As you can see, hon Minister, I have had my haircut. We share your view that departments are expected to do the same to achieve the forecast savings of R27 billion over the medium term.
The ACDP also raised concerns during discussions about the 32% capital underspending by provinces and municipalities. Considering the massive infrastructure roll-out, how will we ensure, hon Minister, that, to quote you, “infrastructure will be delivered on time and on budget”? Close co-operation with the private sector is clearly very necessary and required. It is also essential to root out wasteful and irregular expenditure and corruption, considering that government expenditure will, for the first time, breach the R1 trillion mark.
The Gauteng freeway tolling system remains a bitter pill to swallow, notwithstanding the reduction in the toll fee from 66c to 30c per kilometre, and the monthly capping. This is on top of the 20c increase in the fuel levy. Opposition is not so much about the price, but the principle of tolling suburban routes. However, in conclusion, the ACDP will support this report.
Mr R B BHOOLA: Madam Deputy Speaker, in his state of the nation address the hon President said that the vulnerable and the poor should be given preference. In view of the global economic turmoil and domestic challenges, the MF will be watching whether all of the Budget’s reforms reach the man in the street and the matriculants who did not get access to universities because of budget constraints, and whether it deals precisely with high food costs and the devastating impact on the poor, particularly the pensioners.
The key is job creation. Minister Gordhan is correct that in order to achieve the target of 5 million jobs, we must have a growth rate of 7,5%. Currently we are just on half. We must be reminded that the United States has come out of a recession through the creation of small, medium and micro enterprises, SMMEs, and the informal sector. Therefore more funding must be directed towards this area, to vulnerable groups and, particularly, to minority communities.
The high fuel cost will serve as a negative impediment in the advancement of our economy.
We welcome the infrastructure programme but cherish the hope that it does not open up gaps for corruption. The MF will support the report.
Mr D C ROSS: Deputy Speaker, if we are to embark on an historic infrastructure expansion project, then let us reflect for a moment on the fiscal challenges posed by this project.
The DEPUTY SPEAKER: Sorry, hon Ross. This is the hon Ross’s maiden speech. I have just been told. [Applause.]
Mr D C ROSS: Thank you, Deputy Speaker. The greatest part of the burden will be carried by our state-owned entities and the development finance institutions. But most importantly, the private sector will have to contribute significantly to the success of this project, both in terms of capacity and, of course, in terms of funding. Private-sector role-players will therefore have to be included not only in the Presidential Infrastructure Summit, but also in the Presidential Infrastructure Co-ordinating Committee. Nonetheless, we all acknowledge that the role of state-owned entities will be vital to the infrastructure project.
This brings the important issue — and I think this is a thorny issue, hon Minister — of administered prices to the fore. The current approach, whereby ordinary citizens pay for the construction of new infrastructure investments in the form of high price increases, à la Eskom, is certainly unacceptable. It places pressure on the most vulnerable in our society and does remarkable economic damage to our country. We need to find a new financing solution, where assets pay for themselves over time. Citizens should not be forced to pay for new assets up front but rather later, when utilising these assets. It is just a fact to know that consumers must pay for consumption and not for capital expenditure. That should be the primary departure point.
We need to find partners that can help fund the construction of these projects now, so that we can pay them off over time and public-private partnerships, via our development finance institutions, could co-finance our build plan.
Expecting the state to go it alone now, on the back of massive price and tax increases for ordinary South Africans, is not realistic. If we consider financing infrastructure expenditure through a combination of fiscal allocations, borrower and user fees, the accumulative effect of excessive rises in prices will negatively impact on the economic performance of business and also of industry.
User fees and the principle of “user pays” should be implemented with caution and tariffs should be inflation-related. We need to price infrastructure in a way that makes us competitive and plan our prices better in advance. Hon Minister, South Africa has declined in terms of relative competitiveness and ease of doing business. However, the good news is that if we find the right private-sector partners, with the right know-how and deep enough pockets, especially in funding the construction phases of the infrastructure expansion, we can responsibly finance this project. Then this project will not only aid in modernising our country but also help to reduce poverty, create work and expand employment opportunities to more and more South Africans.
Undeniably the key challenge is in attracting the right partners and striking the right deals to achieve our goals in terms of debt sustainability. I think we have done well so far in our goals. But to do this, we need to invite the private sector to join the Presidential Infrastructure Co-ordinating Commission. [Applause.]
Dr Z LUYENGE: Sekela-somlomo, zihandiba, nezinxiba-mxhaka ezikhoyo kule Ndlu, ndivumeleni ukuba ndibethe koomofu, okokuqala ... [Deputy Speaker, esteemed honourable guests in this House, allow me to be brief. Firstly ...
... let me, on behalf of the ANC, express our sincere condolences to the Deputy Minister, whose mother passed away and was laid to rest this past Saturday.
Sithi ke singumbutho wesizwe, ungakhali ngathi awunathemba, ndoda yakuthi; sikho sonke. [As the ANC, we say, you must not lose hope, my brother; we are all with you.]
Judging by the overwhelmingly positive response from almost all sectors of our society, this year’s Budget has indeed been a ground-breaking one. What drives this response is the public acceptance of the fundamentals of our policies to transform the social and economic landscape of this country. Within the economic transformation trajectory, the Budget had to deal, in the short and medium-term, with the five key priorities of the ruling party.
Given the constraints of our mixed economic system, the success of the funding and resourcing of these priorities will require a creative balance in our fiscal, revenue and tax policies. These policies have to be geared towards supporting the key focus areas of our economic transformation agenda, identified in the New economic Growth Path strategy, which seeks to alter the structure of our economy. It specifically puts forward a developmental approach that is based on the enhancement of inclusive growth and improving sustainability. This approach should serve as the criterion by which we should assess the soundness of our fiscal, revenue and tax policies, as they are critical levers in funding our priority programmes.
According to the New Growth Path, the core measures for sustainable growth are an improved balance on current accounts, combined with a greater reliance on domestic resourcing of investment. Some of the strategies proposed to achieve this include, among others, tax measures to stabilise capital inflows and outflows, measures to encourage the redirection of domestic funds towards developmental investment, supporting company investment in the local economy, and by targeted utilisation of financial savings. These measures can be achieved through a well-balanced regime of fiscal, revenue and progressive tax policies.
The New Growth Path’s emphasis is on expansion of public spending, balancing it with an appropriate and progressive fiscal, revenue and tax policy regime and improving economic efficiencies. Its main thrust is spending on production-based, state-led investment, as opposed to a predominantly consumption-based approach.
Viewed against this model, the fiscal policy addresses some of the pertinent concerns going forward, such as stabilisation of public debt and how we focus on a qualitative shift in our spending patterns in the manner that is proposed in the New Growth Path. The fundamental qualitative shift is a strategic focus away from predominantly consumption spending towards a more production-based one. We welcome the Minister’s announcement that this year, in due course, we will have a long-term fiscal trends report that will form the basis for a sustainable fiscal framework.
The tax proposals, as contained in the 2012 Budget Review, are equally consistent with our broad economic transformation agenda, identified in our New Growth Path. Those proposals that are most consistent are relief for micro and small businesses; an increase in effective capital gains tax rates; reforms to tax treatment of contribution to retirement savings and further reforms of the tax treatment of medical scheme contributions.
As is the case with the fiscal policy study, we equally welcome the announcement of the tax policy research projects to be undertaken during the 2012-13 financial year.
Umbutho wesizwe [The ANC] is encouraged by the overwhelming support these policies have received from the majority of South Africans, most of whom constitute the unemployed and the poor. We believe that these policies are indeed the correct ones to answer the challenges of unemployment and poverty faced by our people. The fiscal, revenue and tax policies outlined in this Budget will go a long way in supporting our economic transformation and development plan through, among others, expanding public spending on infrastructure investment to achieve exclusive and sustainable growth.
It is apt to recall the President’s exhortation to write a new South African story about how, working together, we are driving back unemployment and reducing economic inequality and poverty. The incontrovertible truth is that our infrastructure continues to tell an old and ominous story of how an illegitimate oligarchy intentionally created high unemployment, deep poverty and extreme inequality. History is now presenting us with an opportunity to redress the imbalances of the past.
An infrastructure build of the magnitude confronting us compels a strong developmental state. Planning and monitoring have to be consolidated to ensure the effective implementation of concrete plans. The state must demonstrate that it achieves what it sets out to and its entities and departments have to discharge their mandate fully compliant with legal prescripts.
Fiscal expenditure must at all times be regular and in accordance with generally accepted accounting principles and in compliance with Treasury regulations and other relevant regulatory measures. Of supreme importance is the broadening of the skills base, with particular emphasis on scarce skills within the public sector, to ensure the requisite capacity to drive socioeconomic imperatives and accelerate transformation.
We welcome the R844,5 billion budgeted and approved for public sector projects. We agree to the rigorous assessment of all projects to determine the feasibility thereof. We have noted, as Treasury has, that public-sector capacity to implement projects is currently inadequate. However, we conceptualise the inadequacy referred to as a manifestation of a continuing skills deficit. Our earnest call goes to those private companies that either import or poach skills to engage in skills development of the currently unskilled and to extend training for newly qualified graduates.
We call on state-owned enterprises to prioritise skills development and mentorship to produce the requisite skills for the economy. We are also convinced that, properly handled, the public infrastructure build that was announced in the Budget offers a golden opportunity for artisan training. Our plea therefore is that these projects should not just offer employment for the skilled and unskilled but also ensure that the unskilled become skilled.
It is encouraging to note that Medupi and Kusile coal-fired plants are expected to start operating in 2014 and the Ingula Pumped Storage Scheme is on track to assist with peak capacity supply from 2014. Of considerable importance are the Republic’s plans to provide 25% of generation capacity from renewable sources by 2030, in compliance with the Kyoto Protocol and the Durban Accord.
We agree with the hon President that we need an electricity price plan that will ensure that Eskom and the industry remain financially viable and sustainable, but which remains affordable, especially for the poorest of the poor. We will therefore await with keen interest Eskom’s proposals on tariff management as our interests are always with the poor and the economically marginalised.
We are pleased with the recent completion and commissioning of phase 1 of Transnet’s R23,4 billion new multiproduct pipeline. The pipeline is to increase capacity to meet inland demand and moderate road congestion by reducing the number of fuel tankers travelling between Johannesburg and Durban.
According to the SA Institute of Civil Engineers, municipal infrastructure is deteriorating in many places. Bulk water facilities, particularly in small towns and rural areas, sanitation in many municipalities and provinces, as well as rural roads are particular areas of concern. It is therefore important that we focus our efforts on the renewal of such infrastructure, because the dignity and general health of our people may be compromised.
We need to make use of project management expertise gained and lessons learnt in preparing for the 2010 Soccer World Cup to support infrastructure development. As noted in the World Cup experience, the inclusion of experienced engineers and other delivery experts will ensure better planning, assessment and implementation of projects.
The issue of fraud and corruption cannot be left unattended as it continues to hamstring service delivery efforts. We support Treasury in taking further steps to combat fraud and corruption, including strengthening the national procurement architecture, but we should go further and set up a procurement office. Vetting of all procurement officers is greatly welcomed as part of our campaign, as is developing a national price reference system.
We again call on South Africans, including those in the opposition benches, to heed the President’s call to write a new story. May I remind the opposition that obligations freely assumed must always be observed and that oppositionism is reneging on a binding oath to promote the spirit and purport of the Constitution.
In conclusion, working together, we will do more to build infrastructure to drive economic growth and employment. Yes, the writing of the new story must begin in earnest. We therefore commend the political leader of the department and urge him to continue the splendid work he is doing. We are very proud of him, his team and the entire department. We are very sure that our funds, our finances and the infrastructure that we are talking about are spearheaded by hands that are committed and fully committed under the ANC and the ANC alone.
The MINISTER OF FINANCE: Deputy Speaker, hon members and colleagues from the Cabinet, let me firstly thank all the parties for their reasonably enthusiastic and unanimous support for our first R1 trillion Budget. Thank you very much. [Applause.] It’s fine, you can clap. We need to applaud everybody. [Applause.] Let me also extend our appreciation to the chair of the standing committee, Mr Mufamadi and his team, and also the NCOP committee and its chairperson, Mr De Beer, for the excellent recommendations they made as a result of their deliberations.
We want to reiterate our three key fiscal guidelines which underpin this fiscal framework. The first guideline is countercyclicality, which means that when the economy is not doing well, the state must play a supportive role, and when it is doing well, the state should withdraw its supportive role and build up its resources. The second guideline is intergenerational equity, which means to manage your finances today so that you don’t impose too much of a burden on future generations. The third guideline is debt sustainability, which says manage your debt in such a way that we don’t end up where the boomerang might go, Mr Koornhof. I think all of us would say that the Treasury team and the Ministers’ Committee on the Budget have done extremely well in presenting this fiscal framework to South Africa.
In addition, we have managed to carefully balance support for economic growth and job creation – however modest it might be – together with a medium-term fiscal consolidation approach, so that we don’t make the mistakes that Europe, belatedly, is beginning to realise it had made. Today, a key European commissioner responsible for social security is having reservations about the extreme emphasis on austerity and the impact that it actually has on ordinary people.
Many speakers correctly pointed out our emphasis on changing the composition of expenditure. Let me caution that these sorts of changes in composition don’t happen overnight. What we are going to require is a conscious, multiyear effort to ensure that consumption on the one hand, the wage bill on the other hand and the interest bill on the third hand all change in order to achieve and in favour of the investment part of our Budget being increased far more than we have increased it up to this point in time.
Linked to this — as many hon members have pointed out — is our commitment to present a draft, long-term fiscal framework later this year, so that this constant apprehension that is brought to the fore — will we cope with National Health Insurance, NHI; will we cope with social security changes; will we manage this infrastructure expenditure? — is answered within the context of a sustainable framework that will continue to reflect the kind of balances that we have committed to through the fiscal guidelines.
As the chairperson of the committee has indicated, the moderation of consumption spending — on which a lot more needs to be done than the small haircuts that we are talking about at present — is the kind of direction we want to take and a commitment that we actually want to sustain.
Similarly, although we as a country are not doing extremely well on the jobs front, we can certainly record the fact that hundreds of thousands of jobs were created in the last year. As the chairperson pointed out, some 850 000 jobs could be created over the next three years, even at a modest level of growth. If we are able to ignite growth further within the South African context and get the enthusiasm — as Mr Swart was saying — of all South Africans to start employing more people and creating more enterprises, that number could increase quite formidably.
Several hon members have raised the question of infrastructure funding, which was more than adequately dealt with in both the Budget Review and the Budget Speech. Let me repeat that infrastructure funding is a combination of funding — from the fiscus, from debt, from state-owned enterprises, SOEs, from development finance institutions, DFIs, and from the private sector, where their contribution is appropriate and cost-effective at the end of the day. As we said in the Budget Speech, no good project will not be funded. The real challenge that all of us must acknowledge, and have acknowledged, is the challenge of putting together an implementation machinery, both within and outside of the state, that can effectively deliver on the infrastructure projects that we are putting together.
I am very confident that, under the guidance of the President, we will be marshalling all of our forces, which will include broader elements of our society, over the next few months so that we can put together this capacity that will enable us to get a far more effective machinery in place.
Several hon members made reference to administered prices and their impact. I am told a study was undertaken a few years ago by the National Treasury. We are going to take the dust covers off that study, take another look at administered prices in South Africa and the impact both on our economy and on individual citizens and promote, within government, a more co-ordinated approach on this question so that we don’t impose an unmanageable burden on South African citizens. We will come back to Parliament on some of those questions.
I congratulate the hon Harris on his maiden speech as the spokesperson for finance for the Official Opposition and thank him for his support for the broad thrust of the Budget. However, let me assure him that building a capable state is part of our mission. However, hon Harris, building capable states doesn’t happen overnight. States are built over thousands of years. The Greek state has been there for many thousands of years and you can see the condition that they find themselves in today.
So, what we have and what we need from all of us is the commitment to build the capability of a developmental state. We need to build the skill and capacity within this state that we are talking about and not be cynical – and I’m not saying that you are – about the mission to create a capable state. A capable state is what we require in order for it to play the developmental role that we actually require it to play.
The hon Harris knows that in the committee we talked about the word “cadre”. I want to repeat to him that the word “cadre” comes from a long and proud tradition, meaning the best informed, the most committed, the most highly skilled, the most conscious, the most socially aware and the most socially committed. That is a cadre! [Applause.] What we have come to call “cadre deployment” is a mistaken notion. Where we would agree with every South African is that political office bearers and senior managers within the state must do better at appointing capable people in the right jobs, and the hon Tshabalala actually repeated that for us. [Interjections.]
I want to assure both the hon Koornhof and hon Harris that we are nowhere near Greece and we will never get there, whether we have a boomerang or not, hon Koornhof.
Hon Ambrosini, I must say that your resorting to concepts of nationality and ethnicity to defend your particular view of life is a rather regrettable and unfortunate way of managing a debate. [Interjections.] People like me have been nonracialists for many, many decades. Equally so, there are people on this side of the House who have a deep and profound commitment to nonracialism, who would never, never have used ethnicity as the basis for a political attack. You really need to change your speechwriter now. [Applause.]
The hon Ntapane, as well as several commentators both outside and inside the House, have made reference to these notions of the fuel levy, roads, who pays for the roads and so on. Let’s look at some of the numbers. The fuel levy brings in R42,8 billion, excluding what goes to the Road Accident Fund. Of that approximately R43 billion, R9 billion goes to the metros as a way of financing them after the regional services councils’ levies have been withdrawn. On the other hand, government expenditure on roads is R61,4 billion. Of this, R15 billion goes to the South African National Roads Agency Limited, Sanral; R12,6 billion goes to provincial roads; R13,8 billion goes to municipal roads and some R20 billion goes to rail and bus subsidies. Generally, a lot more is spent on roads and transport, more generally within the government system, than what we collect through the fuel levy.
Let me congratulate the hon Tshabalala on her maiden speech and her very neat balance between social security, on the one hand, and the necessity to create decent jobs in South Africa as the key way to work ourselves out of poverty, on the other.
To the other hon members, I don’t have the time to address all of your issues, but thank you very much for your contributions and, once again, thanks to the committee for the excellent work it has done. [Applause.]
Mr G D SCHNEEMANN: Deputy Speaker, on behalf of the Chief Whip of the Majority Party, I move:
That the Fiscal Framework and Revenue Proposals, and the report of the Standing Committee on Finance on the Fiscal Framework be adopted.
Motion agreed to.
The Fiscal Framework and Revenue Proposals, and the Report of Standing Committee on Finance on the Fiscal Framework accordingly adopted.
FINANCE BILL
(First Reading debate)
The DEPUTY SPEAKER: Hon members, while hon Sogoni makes his way to the podium, I would like to recognise Mr Ellis up there in the gallery. Mr Ellis, I did not think you would miss us so much, so soon! [Applause.]
Mr E M SOGONI: Thank you very much, Deputy Speaker. I was just showing hon Ellis that I have two speeches. Luckily he is sitting up there today, so he can’t comment on them. [Laughter.]
Deputy Speaker, we are dealing with the Finance Bill. The Finance Bill is not a Bill that is normally tabled every year. It is tabled once to achieve a certain purpose. This year’s Finance Bill has three schedules. Schedule 1 relates to section 34(1)(a), which empowers Parliament to appropriate money as a direct charge against the National Revenue Fund, as an additional amount for a particular Vote. In this instance we are dealing with Defence and Military Veterans. To cover the overspending, the amount that we are requesting Parliament to condone is R40 292 419,92. The overexpenditure occurred in the 2003-04 financial year.
The second schedule deals with the amount of R20 625 352,33, which was previously surrendered by the same department to the National Revenue Fund as unauthorised expenditure. That expenditure occurred during the 1998-99 and 2003-04 financial years. Today, this Bill proposes that we refund this money to the same department. The refund is provided for in terms of section 34(1)(b) of the Public Finance Management Act, Act No 1 of 1999.
The last schedule proposes the approval of unauthorised expenditure of R481 821 478,78. This proposal is made in terms of section 34(2), where the amount is charged against the Budget Vote of the Department of Correctional Services. In other words, the difference between this schedule and the other two that have been mentioned before is that this amount will be recovered from the department’s own savings and must be paid in full by the department by 1 April 2015. The Standing Committee on Appropriation recommends that the House approves this Finance Bill. [Applause.]
There was no debate.
Bill read a first time.
FINANCE BILL
(Second Reading debate)
There was no debate.
Bill read a second time.
CONSIDERATION OF REPORT OF PORTFOLIO COMMITTEE ON HIGHER EDUCATION AND TRAINING — STUDY TOUR TO FEDERAL REPUBLIC OF GERMANY FROM 2 TO 9 DECEMBER 2011
Mr M I MALALE: Deputy Speaker, Members of Parliament, I rise to present the report of the Portfolio Committee on Higher Education and Training relating to our eight-day study tour to Germany in the first week of December last year. The purpose of the visit was to do research on the dual vocational education and training system and the German skills development approach in order for us to be able to benchmark this with our own post-school education system.
We met with various crucial stakeholders in Germany, including the federal government ministries responsible for economic co-operation and development, education and research. We also met with the Confederation of German Trade Unions, Humboldt University, the Chamber of Skilled Crafts and Vocational Training, the Federal Institute for Vocational Training, the national marketing manager for vocational education at Siemens, and so on. The interactions that we had with these various institutions are contained in the report published in the Announcements, Tablings and Committee Reports, ATCs. I will traverse only a few of the highlights we noticed about the German vocational system.
In Germany, there are 350 occupations recognised or registered by the state. We found that 60% of the student populace is enrolled in the vocational education system, as opposed to the academic sector, because it provides them with opportunities to learn and earn at the same time. The system really ensures that training happens in companies as opposed to our own system, where it would happen in the FET colleges. In Germany people really are being given an education in the skills area they enrolled for at the place where they will learn in practical terms.
Currently 1,6 million trainees in the vocational system are able to be incorporated into two million German companies. We have 600 of those companies in our country. We just need to link up with them to learn how they engage with this matter of apprenticeship because it is a classic example of integrated workplace learning.
In their country, the Germans are able to ensure career-pathing at the early age of 10, because their formal education system allows for that at intermediary level. At secondary level, there is quite a clear correspondence between their high schools and the vocational sector, which is something we do not really have in our country. These are some of the good examples that we must look at.
Their vocational education training system is driven strongly by research and development. Experts chosen by organised labour, industry and the state decide on the institutions that would be responsible for determining suitable vocational programmes. These are some of the examples that we hope to emulate. I think the current appointment of research chairs bodes well for our efforts to go in this direction.
The private sector in Germany injects massive resources into the dual system and it is interesting that there it is done without any legislative compulsion. In our country, we do get levies from companies, yet when we request the company to train our youth, there is reluctance to do so. We should try to engage German companies which are in our country.
In Germany they also have a programme for the retraining of retrenched workers and unemployed graduates to update and augment their skills and competencies and enable these people to be integrated into the economy.
The standard-setting and quality-assurance measures are the same in the 16 “länders” or provinces, as we call them here. The details are in the report. We recommend that the House adopt this report. [Time expired.] [Applause.]
There was no debate.
Mr G D SCHNEEMANN: Deputy Speaker, on behalf of the Chief Whip of the Majority Party, I move:
That the Report be adopted.
Motion agreed to.
Report accordingly adopted.
CONSIDERATION OF REPORT OF PORTFOLIO COMMITTEE ON PUBLIC WORKS - OVERSIGHT VISIT TO MPUMALANGA FROM 24 TO 26 JANUARY 2011
Ms N D NGCENGWANE: Deputy Speaker, the Portfolio Committee on Public Works undertook an oversight visit to Mpumalanga from 24 to 26 January 2011. It included the district municipality of Ehlanzeni, as well as the Nkomazi and Umjindi Local Municipalities. The portfolio committee reviewed the progress and implementation of the Asset Register, the Expanded Public Works Programme, EPWP, and the Lebombo border post.
We noticed that the Mpumalanga province, as well as the municipalities struggled with compiling proper asset registers, as required by the Government Immovable Asset Management Act, Act No 19 of 2007. Reporting by the municipalities on the progress made in the EPWP was often poor and inconsistent. Most projects used the EPWP principles of labour intensity, but reports received about on-site employment were nonspecific. Officials’ reports on projects implemented contained inadequate information that could not be submitted to the portfolio committee.
With regard to the Lebombo border post, phase one of the border post was incomplete and stakeholders refused to sign off an acknowledgement of completion of the project. Concerns included the lack of proper ablution facilities, searching areas, unopened pedestrian entrances and uninstalled security glass for the police service. The land on which the border post is built was reportedly leased to a private individual for a period of 99 years at an amount of R10 per annum.
With regard to the recommendations by the portfolio committee, it made the following recommendations during its oversight visit to Mpumalanga: On the asset register, it was suggested that a targeted approach should be piloted in the province as a solution to the challenge of completing the asset register of Mpumalanga province as well as that of the municipalities. An amnesty process should be undertaken to ensure that all unknown properties are identified, especially those situated at national, provincial and local levels, with particular consideration being given to the former homelands.
Regarding the EPWP, municipalities should consider providing dedicated personnel to manage the planning, implementation and monitoring of EPWP projects. They should address the high unemployment levels at district level and local municipality level by implementing more EPWP projects and ensuring proper reporting on work opportunities created under the programme in order to access the incentive grant.
Regarding the Lebombo border post, we need to clarify the status of the land at the border post and a report must be provided to the portfolio committee. The national Department of Public Works reported that the matter was being investigated and a report would be provided to the portfolio committee at a relevant later date.
In conclusion, the portfolio committee was informed that the implementation of the EPWP and the completion of the asset register were negatively affected because the municipalities face a number of challenges, including a lack of skills and a high rate of poverty and unemployment. There are also financial constraints in and problems with the hiring of competent staff to fulfil the municipality’s core functions and mandate, as well as huge losses of resources and revenue due to illegal connections to the water and electricity supply. Some municipalities reported losses of up to 50% of income generated by the supply of water due to illegal connections. [Applause.]
There was no debate.
Mr G D SCHNEEMANN: Deputy Speaker, on behalf of the Chief Whip of the Majority Party, I move:
That the Report be adopted.
Motion agreed to.
Report accordingly adopted.
CONSIDERATION OF REPORT OF PORTFOLIO COMMITTEE ON PUBLIC ENTERPRISES — OVERSIGHT VISIT TO DEPARTMENT OF PUBLIC ENTERPRISES AND STATE-OWNED COMPANIES
Mr H P MALULEKA: Deputy Speaker, hon members, the Portfolio Committee on Public Enterprises undertook an oversight visit to the Department of Public Enterprises, DPE, and three of our state-owned companies, namely Transnet, the South African Forest Company Limited, Safcol, and Broadband Infraco. The purpose was to familiarise the committee with the challenges faced by these entities; to assess the working conditions of workers, job creation and skills development initiatives; and the impact of the developmental projects on the communities adjacent to where these entities are situated.
During our oversight, the committee found the following at the department: The committee acknowledged the monitoring systems and tools that the Department of Public Enterprises had put in place to execute its unique function of shareholder management. The committee is concerned with the cases of financial and management irregularities in our state-owned companies such as Transnet, Broadband Infraco and SA Express Airways. The department needed to sharpen its oversight tools, especially through the boards, to detect irregularities and discrepancies timeously. There is also a need for the Auditor-General to audit all the big state-owned companies.
Regarding Broadband Infraco, the committee feels that there is a need for Broadband Infraco to be issued with an electronic communication services licence in order to deliver on its developmental mandate of lowering the costs of connectivity and providing broadband services to clinics, hospitals, schools and so forth.
Regarding Safcol, the committee welcomed projects that were undertaken by Komatiland Forests within the surrounding communities, especially in identifying community needs. Safcol has built school classrooms, donated computers and established early childhood development centres in these communities. We believe the entity can do more.
Regarding Transnet, the committee was impressed with Transnet’s expansion programme of the Durban Harbour as well the state-of-the-art pipeline that goes to Gauteng. These have a positive impact on our country’s economy. There is a need for the Department of Public Enterprises to be sufficiently resourced and capacitated in order to effectively oversee the massive infrastructure projects of our state-owned companies.
Namens ons komitee lê ek hierdie verslag voor hierdie Huis vir oorweging. Baie dankie. [On behalf of our committee, I submit this report to this House for consideration. Thank you.]
There was no debate.
Mr G D SCHNEEMANN: Deputy Speaker, on behalf of the Chief Whip of the Majority Party, I move:
That the Report be adopted.
Motion agreed to.
Report accordingly adopted.
The House adjourned at 16:24.
__________
ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS
FRIDAY, 2 MARCH 2012
ANNOUNCEMENTS
National Assembly and National Council of Provinces
The Speaker and the Chairperson
1. Classification of Bills by Joint Tagging Mechanism (JTM)
(1) The JTM in terms of Joint Rule 160(6) classified the following Bills as a Money Bill:
(a) Rates and Monetary Amounts and Amendment of Revenue Laws Bill [B 10 – 2012] (National Assembly – sec 77).
(b) Finannce Bill [B5 – 2012] (National Assembly – sec 77).
(c) Additional Adjustments Appropriation Bill (2011/12 Financial Year) [B 6 – 2012] (National Assembly – sec 77).
(2) The JTM in terms of Joint Rule 160(6) classified the following Bill as a section 76 Bill:
(a) Division of Revenue Bill [B 4 – 2012] (National Assembly – sec 76).
TABLINGS
National Assembly and National Council of Provinces
1. The Minister of International Relations and Cooperation
(a) Strategic Plan of the Department of International Relations and Cooperation for 2012 – 2017 and the Annual Performance Plan for 2012 – 2013
COMMITTEE REPORTS
National Assembly
CREDA INSERT – T020312-insert1 – PAGES 451 – 474
MONDAY, 5 MARCH 2012
ANNOUNCEMENTS
National Assembly
The Speaker
1. Introduction of Bills
(1) The Minister of Finance
(a) Credit Rating Services Bill [B 8 – 2012] (National Assembly – proposed sec 75) [Explanatory summary of Bill and prior notice of its introduction published in Government Gazette No 35022 of 7 February 2012.]
Introduction and referral to the Standing Committee on Finance of the National Assembly, as well as referral to the Joint Tagging Mechanism (JTM) for classification in terms of Joint Rule 160.
In terms of Joint Rule 154 written views on the classification of the Bill may be submitted to the JTM within three parliamentary working days.
TUESDAY, 6 MARCH 2012
TABLINGS
National Assembly and National Council of Provinces
1. The Speaker and the Chairperson
(a) Strategic Plan of the Financial and Fiscal Commission (FFC) for 2011/12 – 2013/14 and Annual Performance Plan for 2012/13.
(b) Strategic Plan of the Public Service Commission (PSC) for 2012/13 – 2016/17 and Annual Performance Plan for 2012/13.
(c) Report of the Public Service Commission on the Implementation of the Performance Management and Development System for Senior Managers in the Western Cape Province– February 2011 [RP 200-2011].
2. The Minister for Cooperative Governance and Traditional Affairs
(a) Annual Performance Plan of the Department Cooperative Governance and Traditional Affairs for 2012 – 2013 [RP 81-2012].
(b) Strategic Plan of the Municipal Demarcation Board for 2012 – 2017 and Annual Performance Plan for 2012.
3. The Minister of Basic Education
(a) Strategic Plan of the Education Labour Relations Council (ELRC) for 2013 – 2015 and Annual Performance Plan for 2013 – 2015.
4. The Minister of Home Affairs
(a) Strategic Plan of the Government Printing Works (GPW) for 2012/13 – 2014/15 and Annual Performance Plan for 2012/13.
5. The Minister of Justice and Constitutional Development
(a) Strategic Plan of the National Prosecuting Authority (NPA) for 2012/17 and Annual Performance Plan for 2012/13.
6. The Minister of Police
(a) Strategic Plan of the South African Police Service for 2010 – 2014 and Annual Performance Plan for 2012/13.
7. The Minister for the Public Service and Administration
(a) Strategic Plan of the Department of Public Service and Administration (DPSA) for 2012 – 2015.
(b) Annual Performance Plan of the Public Administration Leadership and Management Academy (Palama) for 2012/2013 and Budget (MTEF) for 2012/13–2014/15.
(c) Strategic Plan of the Centre for Public Service Innovation for 2012 – 2015.
(d) Strategic Plan of the State Information Technology Agency (Pty) Ltd (SITA) 2010 – 2014 and Annual Performance Plan for 2012/13.
8. The Minister of Rural Development and Land Reform
(a) Annual Performance Plan of the Department of Rural Development and Land Reform for 2012 – 2013 [RP 43-2012].
9. The Minister of Women, Children and People with Disabilities
(a) Strategic Plan of the Department of Women, Children and People with Disabilities for 2012/13 – 2016/17 and Annual Performance Plan for 2012 – 2013.
06 MARCH 2012 PAGE 92 of 92
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