Hansard: NA: Unrevised hansard
House: National Assembly
Date of Meeting: 29 Nov 2023
Summary
No summary available.
Minutes
UNREVISED HANSARD
NATIONAL ASSEMBLY
WEDNESDAY, 29 NOVEMBER 2023
PROCEEDINGS OF HYBRID NATIONAL ASSEMBLY
Watch here: Plenary
The House met at 15:00.
House Chairperson Ms M G Boroto took the Chair and requested members to observe a moment of silence for prayers or meditation.
The HOUSE CHAIRPERSON (Ms M G Boroto): Hon members, order! The only item on today’s Order Paper is questions addressed to Ministers in cluster 4, economics. There are four supplementary questions on each question. Parties have given an indication of which question their members wish to pose a supplementary question on. No, no, yes. Adequate notice was given to parties for this purpose. This was done to facilitate participation of members who are connecting to the sitting through the virtual platform. The members who will pose supplementary questions will be recognised by the presiding officer. In allocating opportunities for supplementary questions, the principle of fairness, among others, has been
applied. If a member who is supposed to ask a supplementary question through the virtual platform is unable to do so due to technological difficulties, the party Whip on duty will be allowed to ask the question on behalf of their member. When all supplementary questions have been answered by the executive, we will proceed to the next question on the Question Paper. Hon members, order. The first question today, which is Question 787, has been asked by the hon Nkomo to the Minister of Finance. I welcome the hon Minister of Finance.
QUESTIONS TO MINISTERS
Cluster 4 - ECONOMICS
Question 787:
The MINISTER OF FINANCE: Thank you, Chairperson. National Treasury plays an oversight role with respect to the implementation of budget in all spheres of government. As part of our oversight, National Treasury regularly or engages with the departments on their financial performance. Where possible, risks are identified, National Treasury engages departments to ensure that their mitigating strategies are in place to address these risks. In the provincial sphere, this engagement normally happens through the relevant provincial treasuries during provincial visits and quarterly meetings.
Monthly and quarterly expenditure reports are also tools used to flag potential risks to departments.
National Treasury provides reports to executives and legislatures, which may highlight areas of concern regarding financial and/or nonfinancial performance of departments that requires attention. However, it is important to point out that National Treasury’s power is limited when it comes to making departments account for their financial misconduct. Therefore, the role of other institutions or structures like the Auditor- General of South Africa and parliamentary committees, etc, is critical to take forward issues that may have been raised by National Treasury.
The Auditor-General of South Africa will be releasing its general report of the 2022-23 public finance management audit cycle by the end of November 2023 - which means this month.
While poor quality expenditure is not defined in the Public Finance Management Act, fruitless and wasteful expenditure is a useful indicator to gage the extent of losses that the state has incurred over a particular financial period. The hon member is advised to engage with the general auditor’s report once it is released. I thank you.
The HOUSE CHAIRPERSON (Ms M G Boroto): Thank you, hon Minister. I am advised that the hon Mabiletsa will take charge of the follow-up question as asked.
Ms M D MABILETSA: Thank you, House Chair. Minister, the response we have received only refers to provincial departments and we were looking for a holistic financial cost, including national departments and state entities, given that you are having regular engagement. We note the positive reduction in the poor quality of expenditure in provinces for the year 2022-23 financial year down to R189 000 000. What we need to know is what this regular engagement tells us, besides mitigating strategies to address risk. We want to see that National Treasury’s quarterly report to Parliament focus far more on your oversight responsibilities in addressing the poor quality of expenditure. It cannot be that your powers are limited when there is legislation in place to deal with these matters. Could you make a comment on this, please.
The MINISTER OF FINANCE: Chairperson, I think we would welcome the invitation to engage Parliament on a quarterly basis. The good thing is that on a quarterly basis, for national and provincial governments, we publish what we call section 32 reports. It would be welcome to engage Parliament in terms of
section 32 report - a similar publication in the space of local government in terms of section 71 reports. We will also welcome such an engagement. I think we should accept the invitation to engage Parliament on a quarterly basis in using those reports as the basis for engagement.
The HOUSE CHAIRPERSON (Ms M G Boroto): Thank you. Can we have the second follow-up question from the hon Alexander?
Mrs W R ALEXANDER: Thank you very much, Chair. In the current financial year, as a direct consequence to the ANC mismanagement, spending has been revised down by R221 billion additional reductions of R64 billion in 2024-25 and
R69 billion in 2025-26 are proposed. As a result, departments will be adjusting their budgets down to offset the decrease in budgets. The reduced expenditure on public service means that hospitals will be overcrowded, schools understaffed, roads won’t get fixed, and people will struggle.
In addition, South Africa has been placed on the grey list because it has insufficient mechanisms in place to monitor and combat money laundering and terrorism finance activities. What consequence management has been put in place for the
departments that are not performing in terms of budget management and cracking down on corruption.
The MINISTER OF FINANCE: You know, when we are closer to an election, it’s quite easily to cut and frame your question which suggests that you are actually campaigning than asking a question. Because we tabled a Medium-Term Budget Policy Statement with adjustment, what was the message that was emerging from that statement? What was the message that was emerging from that statement? The message that was emerging from that statement was that as a result of revenue shortfall, which was occasioned but two things. The first one was particularly as a result of the mining revenues which fell.
The second one was excessive claims on VAT, which over the next few years as we project, again linked to that is growth, is going to reduce our revenue estimates. There is nothing about mismanagement - this has got nothing to do with an ANC mismanagement, it has to do with the economic performance - simple and nothing else. That’s why I’m saying we’ve got to start from there.
The second set of question which is our main question on this debate, as the rest was politics, is: What is consequence management? Treasury has no consequence management over
departments - I mentioned that point. The individual Ministers, and the individual HODs and Parliament has to hold departments accountable – that’s what Parliament exists for - to account. That’s the main question I was responding to that in terms of section 32, we can provide those requests for Parliament and Parliament should make sure that the relevant accounting officers account to Parliament. Thank you.
The HOUSE CHAIRPERSON (Ms M G Boroto): Thank you. As we proceed, I will now recognise the hon Shivambu. Hon Shivambu. Where’s the Whip? He’s not on the platform. Okay, we’ll come back, try to get the answer. But if we pass this question, we are done. Hon Shaik Emam?
Mr A M SHAIK EMAM: Thank you very much, Chairperson, Chairperson, now that you told us that your powers are limited, and the powers of the Auditor-General appears to be limited, what is the reason that despite that being not within the mandate of National Treasury and the Auditor-General, every politician in this country - knowing fully well how corruption works, starting right from local government level, how contracts are given to the same people at exorbitant prices and not getting value for money. And it’s not within the mandate of the Auditor-General and or Treasury to pick
this up. What can we do and why are we not putting measures to block this? You said in your response to me, Minister, that indeed it is a requirement that they must report on a monthly basis, but they’re not doing it. So how do we close this gap and make sure they are accountable, Minister? Thank you.
The MINISTER OF FINANCE: There are two questions in this, loaded into one. The first one is accountability, which I said that I am more than happy to report every quarter to Parliament on section 32 and once we get that section 32, relevant committees make sure that the accounting officers report. The second part of that question, which is related to the first one, is corruption. Let’s agree that corruption is a criminal offense. Why can’t we report these individuals if we know that a specific individual has done a corrupt conduct?
Can’t we get the law enforcement agents to deal with those individuals? I think that’s the best approach to handle that question. Thank you.
The HOUSE CHAIRPERSON (Ms M G Boroto): Thank you. Information and communications technology, ICT, division, please give the speakers in the House the honour they deserve, not me. The Minister is answering questions, but it’s my photo on the screens. Please, rectify that. Please, change that. Before we
proceed to the EFF, if they are ready, since today we are dealing with the questions to the economic cluster, I also want to welcome and acknowledge the presence in the gallery of this Parliament’s Audit Committee. Thank you for being with us in here. Thank you. You are welcome. The EFF? Are you okay or we pass?
Mr M N PAULSEN: Chairperson?
The HOUSE CHAIRPERSON (Ms M G Boroto): Yes, hon Paulsen.
Mr M N PAULSEN: Chairperson ... [Interjections.] Minister ...
The HOUSE CHAIRPERSON (Ms M G Boroto): Paulsen, I think the hon Manyi is ... [Interjections.] Okay, the hon Manyi? What is wrong now? Proceed, hon Manyi.
Mr M MANYI: Apologies, Chair. The characterisation of misguided and incorrect fiscal policy has poor quality of explanation and a clear demonstration that the governing party stay in office has been too long and it is time we vote them out in 2024. What is poor quality expenditure? It’s either you spend the money for what you budget it for, steal it, or do not spend it. Any other characterisation is just foolish. My
question is: Besides waiting for municipalities struggling with spending of conditional grants throughout the financial year, why does the National Treasury not intervene much earlier to ensure that all conditional grants are spent and are spent on time? Is their capacity in the National Treasury to do this. Thank you, Chair.
The MINISTER OF FINANCE: The problem is that I’ve said this in one in one sitting here that there are people who have conditioned themselves that the ruling party is going to lose. When we win ...
HON MEMBERS: When? When?
The MINISTER OF FINANCE: When we win ...
IsiXhosa:
NgesiXhosa kuthiwa niza kufa isiqaqa.
English:
In other words, people will be shocked and claim that elections have been rigged because you’ve conditioned yourself to think that you are going to win the elections. And we are going to win. Let me come to your question. We supervise
financial management of municipalities. But we don’t take responsibility for the management of municipalities.
Institutions such as council and everybody, we don’t have authority over council. We’ve got to help that council to manage the affairs of the municipality. We keep constant report. As a new Member of Parliament, you must familiarise yourself with this thing - what is called section 71 reports, which we table and publish every quarter. You, as Members of Parliament, have to help us to make those politicians account. Don’t say that it’s only our responsibility - Parliament has a responsibility to exercise that oversight. So, once these reports are published, you must also acquaint yourself with proper information. So, you must exercise oversight ...
IsiXhosa:
... ungahlali njee apha, uyabhatalwa.
The HOUSE CHAIRPERSON (Ms M G Boroto): Thank you. As we proceed to the next question, which is Question 821, asked to the Minister of Employment and Labour by Dr Cardo. The hon the Minister?
Question 821:
The MINISTER OF EMPLOMENT AND LABOUR: Hon House Chairperson, when the media publish a story, it stated that there were irregularities regarding an agreement between the Unemployment Insurance Fund, UIF, Department of Employment and Labour and Thuja Capital, the executive authority quickly responded and suspended the implementation of the agreement and payments thereof then instituted an investigation. The investigation report was handed over to the executive authority that instituted it.
The executive authority and the accounting officer currently are processing the findings of the investigation report. There is nothing in the findings of the report that says I must give it to any other arm of the state. The processing of the report is currently at the point where I am approaching the court to set aside that agreement and further the report speaks to some affected employees wherein the employer employee internal processes in terms of the Department of Employment and Labour policies those are still underway. Therefore until such processes are completed, it may be prejudicial to the listed employees to release that report. Certainly, after having regard to the completion of the internal processes then the related court process, will be able to consider the request to share that report publicly. Thank you.
Dr M J CARDO: Hon House Chairperson and hon Minister, the R5 billion deal between the Unemployment Insurance Fund and
the Thuja Capital remain shrouded in Mystery. In fact, it has been swept under the carpet from the very beginning and it is you hon Minister, holding the broom. Instead of demonstrating transparency and accountability you have steadfastly refused to share any meaningful information with the portfolio committee since the scandal erupted. You allegedly handpicked a law firm possible in violation of the Public Finance Management Act, to conduct the forensic investigation into the deal. We read about it in the press. The forensic report apparently recommends disciplinary action against the UIF commissioner and other departmental officials. We read about it in the press. The director-general subsequently, resigned under the cloud. We read about it in the press.
Hon Minister, when are you going to come clean with the portfolio committee about this deal and also clear your own name in light of the allegations made against you by Mthunzi Mdwaba, the Chief Executive Officer, CEO, of Thunja Capital and former Chair of Productivity SA namely that you apparently asked an intermediary to solicit the R500 million bribe in order for the deal to go ahead?
The MINISTER OF EMPLOMENT AND LABOUR: Fortunately, hon member, you have been part of the portfolio committee. I did indicate that I will be able to bring that report at the right time.
You were there. However, what I am not going to do if there are individuals who are implicated I cannot violate those people’s rights as per the Labour Relations Act. Otherwise you are going to come and say there was no consequence management because we might have violated the processes. We might a very substantive case but if procedurally we are not following those procedures we might be found wanting.
We have had cases where you lose them because the procedural processes were not followed.
The allegations that you are talking about, I have said and I want to say, Mthunzi Mdwaba must not run to the social media. He must come and put those allegations on record in court and be able to say this deal is being cancelled because we demanded the kickbacks. He must come and say those things on record in court. We are ready to interrogate what he is saying not in the social media.
However, I want to put it very clear, I reject those allegations with the contempt that they deserve. Thank you.
Mr S W MDABE: Hon House Chairperson and thank you hon Minister for the response. Hon Minister, thank you for going public on the matter. Having released the outcome of the investigation to present it to court for the court to take its cause.
What steps will you take? If not, why not, for those who are implicated in the report? Thank you.
The MINISTER OF EMPLOMENT AND LABOUR: It is very clear, hon member that consequence management says there must be disciplinary steps which are taken and those who are implicated must come and answer how and why they did this and if found guilty there must be sanctions. Those are the steps I intend following. So, the issue of disciplinary processes is very critical in dealing with this particular matter.
So, I will be following all those steps. However those steps must be properly followed in terms of the law, not just in terms of our wishes. For the danger we might want to hurry and have missteps in the process. So, definitely, the processes have to follow. However unfortunately, those processes have to be led by the director-general, DG, as the accounting officer. I am not talking about the resigned DG, I am talking about the acting DG at the particular moment. Thank you.
Mrs H DENNER: Hon House Chairperson and hon Minister, I am glad that you mentioned consequence management and that you mentioned the resigned DG. I would like to know did the director-general of the department Mr Thobile Lamati resigned because of this scandal and the findings in the report. I am asking this because just as the presentation of the report to the committee is being delayed, so is the report of the DG’s resignation as well. If he indeed resigned because of this mess that happened under your tenure as the Minister, how will consequence management against them because it seems it is just too easy to resign when a scandal is made public and nothings happens to you and Minister it is very important that an example needs to be made in this case. I look forward to your answer. Thank you, House Chairperson.
The MINISTER OF EMPLOMENT AND LABOUR: I do not know why he resigned. He put a resignation after we had received the report, but not published it.
We will leave that to the court as to how is he implicated in this particular deal. For the fact of the matter is once the person has resigned and is out of the public service there is no way that you can be able to deal with that person. Unless there is something which is criminal arising out of that. No.
Go and read your labour law. If a person has resigned, unless there is something criminal which is arising out of that. We are going to leave that to the courts to determine.
So that the matter now is at the level of the court, we will watch very closely how the court is pronouncing on that. Thank you.
Ms C N MKHONTO: Hon House Chairperson and hon Minister, in this matter you are implicated as an individual specifically on the background activities that were taking place in an as far as this R5 billion matter is concerned.
What are you planning to do to clear your name and are you going to do that out of your own pocket or are you going to use state funds to clear your name? Thank you.
The MINISTER OF EMPLOMENT AND LABOUR: Hon member, I am not sure what you mean when you say I am implicated. I am not sure what do you mean when you say I am implicated in the Thuja Capital deal, when I am the one who stopped it and when I am the one who started investigating it. I am not sure what you are talking about.
I am acting as an executive authority and not as an individual in that. So, the costs would be in terms of my official capacity. If there is something which involves me as an individual then you can talk like you are talking now.
However, in so far as I am concerned, I am acting as an executive authority. Thank you.
The HOUSE CHAIRPERSON (Ms M G Boroto): May we remind hon members about using alleged because some matters really, you cannot raise that a person is implicated. You must bring a substantive motion for that. So, let me just end here and say let me caution that certain issues need substantive motions. Do not conclude. Thank you.
As we proceed now and we proceed to Question 828, asked by the hon Ceza to the Minister the Minister of Mineral Resources and Energy. The hon Minister.
Question 828:
The MINISTER OF MINERAL RESOURCES AND ENERGY: Hon Chairperson, hon members, let me start off by agreeing rare occasion, Mr Ceza, of the EFF that this thing of saying renewable are cheap is an assumption that is not proven. I want to start there. I follow the cost of Bid Window 1, 2, 3, 4 and 5. In Bid Window
5 there was an attempt to reduce those prices to 47 cents a unit. Majority of those bidders couldn’t reach financial close. So, it’s a myth that we must bid as we go.
Now to answer the question, tariffs are derived from integrated power system. In other words, they are comprised of energy from nuclear, from coal, from solar, from wind, from hydro and from diesel. All those costs are integrated and averaged and they are approved at a cost by the National Energy Regulator of South Africa, Nersa. Therefore, there is no cost from Independent Power Producers, IPPs, that goes to the poor or the working person. It is their negated price as approved by Nersa that goes there, which is averaging all of them. If we had a choice, we would allow working people to get the price that we get from nuclear. That’s the lowest cost that currently we have in the system.
So, we are confidence of high electricity price that the country is currently experiencing. Consequently, the structure of electricity is undergoing reform to improve efficiency of the electricity industry including participation of new players. There is an economical assumption that once there is competition price is going to come down. That’s an assumption. It’s not a fact at this sport in time.
As we open competition, we assume that prices are going to come down. It’s not always the case. Now ensued of financial support measures that were announced by the National Treasury in 2003 Budget Statement are being implemented and further to these indigent households are beneficiaries of basic electricity provision. That programme is aimed at assisting the poor and the bottom end of earners in society. That’s where we are. Therefore, the free basic electricity is fully funded by the national fiscus. So, the state does take responsibility to caution the poor and of society from electricity prices. Thank you.
Mr K CEZA: Taking to account what you have said turning to the caution that the state has towards the poor, 82% of the residents of Mahlongwa giving you a scenario in local government in OR Tambo depend on these free units, Minister.
Really, taking into account what you have just said, there is over 2 million that are outside that indigent list and the burden of introducing the Independent Power Producers who are profit-driven and not giving value to the grid and while they are generating a lot in terms of profit. As said by the people of Mahlongwa, what is the relationship between the above issues of unbundling of Eskom and the road-map to Eskom? And
how will it ultimately affect the working class in terms of how it is in right now? Thank you very much.
The MINISTER OF MINERAL RESOURCES AND ENERGY: The original question was on the impact on the poor and those poor are beneficiaries of the free electricity tariff. Now he is raising a new question, what do we do about those who are earning above indigents? There is no policy that covers that because when you are above indigents, there are something that you are capable of paying. Therefore, there it is expected that you pay for the service that you receive. But the poor receive free basic service subsidy from the state. All those money is paid by the fiscus. So, the question that is asked now has nothing to do with the original question of what plans are there to help the poor? He is now talking about how do we help now the middle class? It’s a total new question.
IsiXhosa:
Mnu K CEZA: Awundivanga ... [Ngokungavakaliyo.] Akandivanga uMphathiswa. Akandivanga.
UMPHATHISWA WEZIMBIWA NAMANDLA: Ndikuve kakuhle.
The HOUSE CHAIRPESRSON (Ms M G Boroto): Thank you very much, hon Ceza.
Mr K CEZA: Chairperson?
The HOUSE CHAIRPESRSON (Ms M G Boroto): No, hon Ceza, you don’t have to do that. Don’t do that.
Mr K CEZA: Okay, Chair.
The HOUSE CHAIRPESRSON (Ms M G Boroto): Let me just remind you that on Rule 142(6), it tells us that the follow up question must be directly from the original question. Now the Minister spotted that one. Thank you. We proceed. Let’s proceed to hon Wolmarans.
Mr M J WOLMARANS: Hon Minister, since Eskom’s long-term financial sustainability remains dependent on the migration towards cost-effective tariffs, how will the department ensure that Eskom desire for cost-effective tariffs reflects the declining cost of renewable energy sources from Independent Power Producers as a portion of totally primary energy cost and balance the need for Eskom’s financial position while
protecting the poor and working class consumers against high cost reflective tariffs? Thank you.
The MINISTER OF MINERAL RESOURCES AND ENERGY: I am known to be
a believer of a multiple pathways in dealing with the transition. I don’t believe that we move from coal to renewables. I think we follow the multiple pathways. Therefore, any costs that accrued to the poor will be a function of that multiple pathways. It will take into account nuclear. It will take into account coal. It will take into account solar. It will take into account wind. It will take into account hydro and many other pathways.
So, we cannot have an aim of just dealing with one technology in dealing with a complex problem that impact on the poor.
So, I think the Integrated Resource Plan, IRP, as it is, I don’t know what the revised one will say. The IRP has its stand encourages us to have a multi pathways to electricity tariffs and that will help us bringing down the cost. And if we increase for the first time the component of nuclear which is giving us energy at 47 cents a unit now, it means that it can impact more positive and we can go to various tariffs and see which one is bringing the cost down.
So, it is not about just focussing on what renewables are doing. It is about the multi pathways of energy sources that the country must have access to. Thank you.
Mr R N CEBEKHULU: Minister, has the department ever thought entered into any agreement with foreign governments that have faced the same energy crisis and have successfully addressed it, if not an alternative so what are the relevant needs?
IsiZulu:
Inkosi R N CEBEKHULU: Mhlekazi akusiyena wokuqala uHulumeni waseNingizimu Afrika womMnyango wakho obenezinkinga ze-energy. Amanye amazwe sewake abanazo izinkinga, ezinkingeni akwazile ukuphuma.
Owakho uMnyango wenzenjani?
SOLWAZI C T MSIMANG: Ngizongena kulo mbuzo. [Ubuwelewele.]
The HOUSE CHAIRPESRSON (Ms M G Boroto): Who is that. Christian? Oh, is the one, is Prof himself. Prof Msimang, relax. Inkosi Cebekhulu is busy with your question. Minister, did you get the question?
The MINISTER OF MINERAL RESOURCES AND ENERGY: I did get the
question. Comparative studies are a norm in any government to work itself that when you go through a difficult process, you go and look into other countries as it is the case that other countries do look at us. Let me give you an example, Cape town townships is a no go area here but when you go to Ghana or you go to Codivar or you go to all those countries in the western part of the continent they all use Karpowership and it works for them. When you come here you say that solution has worked in country x, y and z.
It is up to us as a team to accept interventions. I can see that hon Mileham is laughing me off. You can laugh me off.
The reality of the matter is; we don’t like solutions that are comparative with other countries. We think that we are Holier Than Thou. Therefore, we can breathe fresh air in darkness.
That’s our belief and it doesn’t work in real life. I agree with you Inkosi that it is important to do comparative studies with other countries and we are doing that, hon Cebekhulu.
Question 788:
The DEPUTY MINISTER OF COMMUNICATIONS AND DIGITAL TECHNOLOGIES: I am here.
The HOUSE CHAIRPERSON (Ms M G Boroto): Oh, they wrote here that you’ll be in the Good Hope Chamber, hon Deputy Minister. You can proceed, we are now on Question 788.
The DEPUTY MINISTER OF COMMUNICATIONS AND DIGITAL
TECHNOLOGIES: House Chairperson, can you hear me?
The HOUSE CHAIRPERSON (Ms M G Boroto): Yes, we can. What is wrong? You appear and disappear; hide and seek.
The DEPUTY MINISTER OF COMMUNICATIONS AND DIGITAL
TECHNOLOGIES: I am saying, unfortunately I won’t be ... Chairperson, but I can hear you. May I proceed?
The HOUSE CHAIRPERSON (Ms M G Boroto): Yes, you may.
The DEPUTY MINISTER OF COMMUNICATIONS AND DIGITAL
TECHNOLOGIES: Thank you, House Chairperson and thank you, hon Molala, for the question, the response is as follows: The financial situation of the SA Post Office is in a ... [Inaudible.] ... stage. The Post Office is unable to meet its financial obligations, with 12 billion owing to creditors and costs significantly exceeding the revenue. Therefore, the SA Post Office business rescue plan proposes a reduction of the
branch network to about 600 branches for the ... [Inaudible.]
... However, this reduction, which considers branches designated as universal service obligation will attempt to ensure that these branches, firstly, remain open; and lastly, that these branches are equitably located geographically.
Furthermore, the SA Post Office will negotiate with Postbank to transfer some of its branches, such as the Postbank such that the Postbank can operate its own independent network in rural and remote areas. Initially, focusing on stabilizing the entity, the business rescue plan embarks on the implementation of several modernization programmes, including replacing legacy systems, upgrading support point of sale system, upgrading its data centres, and launching a series of digital, postal, and financial products. The SA Post Office’s courier and the financial business segment will undergo complete modernization to ensure its services and products are in line with the current market trends. Thank you very much, House Chair.
Mr L E MOLALA: Thanks Deputy Minister for the comprehensive response. Deputy Minister, how much, if any amount of the R2,4 billion bailout funds from National Treasury have been
utilized to reduce the SA Post Office’s liabilities and ensure that no further branches are closed?
The DEPUTY MINISTER OF COMMUNICATIONS AND DIGITAL
TECHNOLOGIES: House Chair, the R2,4 billion, which has been allocated to the SA Post Office as a bailout is currently being utilized during the business rescue process. There are drawdowns that are being made by the business rescue practitioners to cover the operational liabilities of the Post Office, which, as we said, is currently under ...
The HOUSE CHAIRPERSON (Ms M G Boroto): Hon Deputy Minister, if you can switch off your video. I think your bandwidth is a bit weak.
The DEPUTY MINISTER OF COMMUNICATIONS AND DIGITAL
TECHNOLOGIES: ... administration. So, the detailed cost of how much ... Alright, let me switch off, maybe it will help.
The HOUSE CHAIRPERSON (Ms M G Boroto): Yeah.
The DEPUTY MINISTER OF COMMUNICATIONS AND DIGITAL
TECHNOLOGIES: I was saying that the actual ... [Inaudible.]
... will become available once the process has been concluded.
The business rescue plan was finalised on Thursday last week and published. It will be up to the creditors to vote on the business rescue plan, and that meeting is scheduled to take place on 7th December, which is next week.
The HOUSE CHAIRPERSON (Ms M G Boroto): Earlier on, I welcomed the audit committee of Parliament, and I looked at the wrong people. They are here now. I was told you were here when you weren’t here yet. You are otherwise welcome. Thank you.
Ms N W A MAZZONE: Deputy Minister, a sign of the times I think that you can’t connect yourself to Parliament, but be that as it may, Standing Committee on Public Accounts, Scopa’s, business plan was, in fact, released last week as you said.
Deputy Minister, could you tell us what your plan of action is as 6 000 employees are set to lose their jobs, and a further
420 branches are set to close? What are we going to do to mitigate this waiting disaster? The SA Post Office requested R3,8 billion from the fiscus for a further bailout. Thankfully, the fiscus said no. Treasury said no. What is your intention now, and do we face the possibility of having a South Africa with no Post Office?
The HOUSE CHAIRPERSON (Ms M G Boroto): Hon Mazzone, I think you are aware that you have asked four questions, and Rule 142(7) says a supplementary question may not consist of more than one question. So, Deputy Minister, whatever your response is your prerogative. Please proceed.
The DEPUTY MINISTER OF COMMUNICATIONS AND DIGITAL
TECHNOLOGIES: House Chair, we are more than capable of responding to hon Mazzone on all the four questions that she has posed. Maybe just to say, yes, I got some connectivity challenges because we’re experiencing load shedding where I am. So, it’s something that I cannot help with, hon Mazzone. On your substantive questions, indeed the planning - although it’s supposed to be still confidential to be voted on by the creditors on the seventh - but as we know, the details of the plan have been out. One of the key issues that the business rescue practitioners are raising is the unsustainable cost of staff. The proportion of staff expenditure to the revenue is quite unsustainable, for example, in the report they are saying that the staff cost about 150% of the revenue of the entity, which is something that is quite unsustainable. But they have had discussions with the recognised trade unions.
And the plan is out there. The idea here, hon Mazzone, is to put the Post Office on a sustainable pedestal, meaning that we
need to look at all the costs that are impacting on the viability of the Post Office. Quite rightly so, the business rescue practitioners have identified this, and it is up to the creditors to vote on it. The second issue is on the branches. There is a proposed reduction. It’s not a very big reduction, but it’s there is a reduction that is aimed at making sure that ... [Time expired.]
The HOUSE CHAIRPERSON (Ms M G Boroto): Hon Deputy Minister, unfortunately, you only have two minutes to respond. Thank you.
Mr S TAMBO: House chair, I think let’s begin by saying it’s ironic that the Deputy Minister said the reduction in prospective closures of post offices is minimal considering that we know already 48% of the post offices of South Africa have been closed with debt. But that’s not the point. I think hon Molala asked a simple and very basic question that is in line with the question I want to ask, which is: How much exactly has been spent of the R2,4 billion which was allocated by Treasury to support, firstly, to deal with its debts; and lastly, to lead its modernization and what type of modernization has happened since the bailout of R2,4 billion was given to the SA Post Office? Thank you, Chair.
The DEPUTY MINISTER OF COMMUNICATIONS AND DIGITAL
TECHNOLOGIES: Hon Chair, unfortunately hon Tambo, we don’t have the details of what has been spent up to so far. The business rescue practitioners are engaged in a process of trying to rescue the entity, and at an appropriate time, they will account because these are public funds, and at any point, these funds will have to be accounted for. But that report is not available yet. When an organization is going through a business rescue process ... [Inaudible.] ... So, I was saying here the rules are such that the business rescue practitioners will prepare a plan and this plan will detail how all the creditors will receive their payment. So, if you any of the creditors gets to be paid before the plan is voted on, that will be against the rules because the rule will allow that the plan must be put on the table so that the creditors can see how much they can be paid for. What has been used, the drawdown has been used for the operational expenses of the Post Office to keep it afloat, not to pay of the any of the creditors whose debt has been confirmed. I said the reduction has been minimal because when you look at the cost of running this in the interim, you would realize that the proposal to reduce some of the branches, and to negotiate with the Postbank so that the bank can be able to operate its own
branch network and later on, when the business becomes viable, more branches are going to be reopened. Thank you, Chair.
Ms Z MAJOZI: Hon Deputy Minister, one of the reasons that we were cited for the SA Post Office lending in its current position is the entity’s failure to adopt digital development. With and knowing that the turnaround strategy of the SA Post Office says that we are looking at the SA Post Office of the future, what are the programmes in place to make sure that we digitally have upskill current Post Office employees and those that will be employed in the future? Thanks.
The DEPUTY MINISTER OF COMMUNICATIONS AND DIGITAL
TECHNOLOGIES: Hon Majozi, you are right in saying that one of the things that impacted negatively on the future viability of the Post Office has been the impact of digitization. The impact of the Internet has made communication through letter posts redundant so to speak. So, this has had a significant impact, not only in our own postal office, but globally, all the global postal operators are struggling under this. So, all of them are transitioning to embrace the digital era. What we have done is to come up with a strategy that we call the Post Office of Tomorrow, which strategy is seeking to reposition the Post Office to become a several things, to play in the e-
commerce space, to become a logistic hub, to become an authentication authority, especially in this era of digital identity. So, we are repositioning the Post Office in line with the strategy of tomorrow, not only to focus on the letter post, which is still important, but it’s something that is declining, to focus on other business areas in the economy.
Thank you very much, Chair.
Question 807:
The MINISTER OF FORESTRY, FISHERIES AND THE ENVIRONMENT: House
Chair, thank you to hon Singh for the question. A just transition to a low-carbon economy will benefit all South Africans, by driving green growth, creating jobs and contributing to energy security, while addressing the serious threat of climate change. The Just Energy Transition, Jet, Investment Plan for the five-year period 2023 to 2027 sets out the scale of need and investments required to achieve the decarbonisation commitments of our nationally determined contribution, which outlines the rate at which South Africa plans to reduce its greenhouse gas emissions and represents our fair contribution to the goals of the Paris Agreement.
The Jet Implementation Plan confirms that South Africa’s resolve to manage the just energy transition is at a pace,
scale and cost that is consistent with the country’s socioeconomic development path, needs and affordability, and reaffirms that the just transition, incorporating distributive, restorative and procedural justice, is at the centre of South Africa’s low carbon economy.
Regarding question two, which speaks specifically about interventions required, I can say to the hon member that the skilling, reskilling and upskilling of workers is essential to transition workers from existing jobs to new opportunities.
Five flagship interventions require financing and support.
Firstly, the establishment of a three-tier Jet skills ecosystem, to co-ordinate and align skills activities across multiple institutions and stakeholders, which is in line with the Department of Higher Education and Training’s National Skills Master Plan 2030.
Secondly, the establishment of skills development zones focused on three core value chains, namely in Mpumalanga, for renewable energy and transmission, in the Eastern Cape, for new energy vehicles, and in the Northern Cape, anchored in local education institutions, in partnership with business, to
support local economic development initiatives linked to the green hydrogen value chain.
Thirdly, Jet skills needs assessments for each of these three value chains and the implications there are for tertiary institutions, capacity building for government and key government institutions.
Lastly, support for foundational skills development, involving upskilling of teachers and integrating sustainable energy concepts into school curricula.
The HOUSE CHAIRPERSON (Ms M G Boroto): I’m looking at those that are standing when the Minister is busy. Hon Meshoe, you are disturbing the process.
Mr N SINGH: Hon Chairperson, hon Minister, one would have thought that you would have been on a on a jet to Dubai by now for COP, but I see you’re in the House. I think, it shows your commitment. Perhaps you are jetting off this evening to do justice for us and the country, in terms of ensuring that the other countries, particularly the developed countries, contribute to the just transition that we want to adopt here in South Africa.
Minister, sometimes I get the impression talking to people that they feel that the just energy transition is just about finding socioeconomic opportunities for those who would be deprived when coal mines are closed. And that seems to be the general trend how people think. They think that’s what it is all about, but it goes beyond that. As you indicated, it goes to issues like skills transfer, skills development.
Having said that, you know, I am always passionate about South Africans, particularly disenfranchised South Africans having equity opportunities in renewable energy sources and methodologies that we may use.
Whilst we want to be employed, we also want to be owners. And I want to know if there is any aspect of the plan that would ensure that ordinary South Africans living in Mpumalanga and some of those other areas, when new methodologies are introduced to replace coal-fired power stations, will benefit.
I think it is very important for us to have that. And I see that international partners are also pouring in a lot of money at very low interest rates into South Africa, particularly the Western countries. And I think they should be conditionalities.
Having said that, my question is, you know, those of us who are in the environmental space, including yourself and the members of the portfolio committee, want to jealously guard
... [Time expired.] Will you do that on our behalf? Thank you.
The HOUSE CHAIRPERSON (Ms M G Boroto): Two minutes?
IsiZulu:
Imizuzu emibili yonke.
Mnu N SIGNH: Ngiyabonga.
The MINISTER OF FORESTRY, FISHERIES AND THE ENVIRONMENT: House
Chair, I didn’t really get what he wants me to do, but let me just ...
The HOUSE CHAIRPERSON (Ms M G Boroto): Let me help you, hon Minister. A member can make a statement or just give an opinion. So, do respond in any way, because the time were over.
The MINISTER OF FORESTRY, FISHERIES AND THE ENVIRONMENT: House
Chair, I think, the issue that I want to pick up on is the point that he makes about opportunities for those in our
society to participate in new green sectors of the economy. And I think that, when we look at the issue of justice and when we talk about restorative justice, we’re not just talking about trying to create opportunities for workers who might be currently in the coal value chain; we are also talking about the fact that, because of the history of this country, many people have been excluded from economic participation and from economic ownership.
And one of the investment portfolios in the Just Energy Implementation Plan is creating a whole new development trajectory for the province of Mpumalanga. And central to that is the question of economic diversification, transformation and industrialisation in areas such as microgrids, agrovoltaic cells and so on, so that we can promote new owners in the energy value chain, and so that marginalized communities should also benefit from the opportunities of green investment and green growth, not just as workers but as owners. Thank you very much.
Mr A M SEABI: House Chair, can I take the question for hon Dlamini?
The HOUSE CHAIRPERSON (Ms M G Boroto): With pleasure.
Mr A M SEABI: Minister, how would the agreement on the Transition Committee of the United Nations Framework Convention on Climate Change on the operationalization of the Climate Loss and Damage Fund fasten the just transition to low carbon economy, given the socioeconomic challenges that the country is facing, and what is the plan in place to integrate skills between new and experienced employees in the fossil fuel sector? Thank you.
The MINISTER OF FORESTRY, FISHERIES AND THE ENVIRONMENT: House
Chair, I think the first thing that one would want to say is that the Loss and Damage Fund is really a separate instrument under the UNF Triple C that aims to deal with the impact of climate change on our lives and on our built-in infrastructure. So, it is not directly related to the issue of the just transition, but I think the purpose of the skills development component of the Just Energy Transition Implementation Plan is to ensure that those who are vulnerable and marginalized, should not carry an unjust burden of the gradual transition to other forms of energy generation.
I think what we know is that most of these workers are highly skilled. They are well paid, they have medical aids and pensions and if they are to find other forms of employment,
they would want to find those forms of employment in industrial jobs. They don’t want to be offered casual work in tourism or other activities. They want industrial work, and that is why the emphasis on the Mpumalanga transition plan is all about looking at other forms of industrialisation in Mpumalanga. And, as I said, we are already looking at the issue of the assembly of agrivoltaic cells, assembly of micro grids and the issue of agro-processing, because that will create industrial jobs of a similar order to the jobs that exist already. Thank you very much.
The HOUSE CHAIRPERSON (Ms M G Boroto): Pardon my pronunciation. Hon Bryant. Is that so?
Mr D W BRYANT: Yes, perfect. Minister, according to the SA Climate Finance Landscape Report 2023, which came out today, Western Europe accounts for 57% of international climate finance flows to South Africa. And we hope that these relationships are not put in jeopardy by the growing closeness between this government and countries such as Russia and Iran, which themselves have made little to no significant contribution to the African climate financing up till now. The financing for the Jet Plan is an essential part of diversifying our energy mix. Local governments, such as the
DA-led City of Cape Town, are already taking steps to roll out ambitious projects to increase access to renewable energy. And Mayor Jordan Hill Lewis is managing to do this by aiming to create what we referred to as, prosumers, who are able to generate their own green electricity and sell the excess back into the grid at a profit.
The rooftop solar industry is just one of the many contributors to the 200 000 jobs created by the DA-led City of Cape Town this year. There is, however, now a massive challenge to many industries coming down the road in the shape of the EU’s carbon border adjustment mechanism, or CBAM, which could see many sectors ... [Time expired.]
The HOUSE CHAIRPERSON (Ms M G Boroto): Hon Bryant, your time is up.
Mr D W BRYANT: That was not two minutes, ma’am.
The HOUSE CHAIRPERSON (Ms M G Boroto): No, two minutes ... Okay. Check your Rules under Rule 142. There is a difference between the first follow-up question and the subsequent ones.
The MINISTER OF FORESTRY, FISHERIES AND THE ENVIRONMENT: Hon
Bryant, I think, we would agree that South Africa must fight CBAM with everything we have. It is a measure that is opposed to the principle enshrined in the UNF Triple C of common but differentiated responsibilities and capabilities. It is an affront to the World Trade Organisation, because it is unilaterally imposed and not negotiated. I think that we must all agree that this is something that would have a devastating effect on our economy, on our workers and on shared prosperity. We must fight it.
Mr B N HERRON: Hon House Chair, Minister, the first social impact study on the Kamati Power Station closure occurred in 2020 and then in May last year, the first alternative energy project began construction, but five months later, the plant was shut down, leaving thousands of employees without income. If this was to be a trend, this would be damaging to the reputation of the just transition and could foster an anti- environment and antigreen energy sentiment, which is obviously not what we want. So, are there any plans to assist the employees who did not experience a just transition in the Kamati decommissioning? Thank you.
The MINISTER OF FORESTRY, FISHERIES AND THE ENVIRONMENT: Hon
member, let me firstly say that workers directly employed in Kamati did not lose their jobs. They are highly skilled workers. They were transferred to other plants, but the people who were severely disadvantaged as a result of the closure of that plant were all of those who existed in the broader ecosystem and who would have been providing services to that plant. It is not a good guinea pig study, and it certainly does not enshrine the concept of justice, as adopted by Cabinet and as adopted by the Presidential Climate Commission.
I have recently had a meeting with the World Bank, where I have brought to their attention the study, which the Presidential Climate Commission did on that decommissioning process and I have asked them to work together directly with that community, to identify projects and programmes that that community would like to see that will create alternative livelihoods and will also deal with some of the socioeconomic consequences of that unjust transition.
During the conversations that we have had, I have stressed to them that although that programme was not part of the Jet implementation project at all, it was a separate project, its outcomes are material for the confidence that all of us can
possibly have in the justice of the transition. And it needs to be fixed. Thank you very much.
Question 789:
The MINISTER OF AGRICULTURE, LAND REFORM AND RURAL
DEVELOPMENT: Thank you very much, hon House Chair, and thanks to the hon member for her question, which is indeed important because all of us do eat chicken. Few may not, but the majority of us here do eat chicken and eggs.
The issue relates to the cost of poultry products and just to say one of the things that are major imports in poultry production, particularly chickens, are soya, maize, as well as sunflower, unfortunately, these are what drive the prices in poultry production, particularly soya because South Africa, even though it produces soya, it exports a majority of it and then the industry has to buy as imports, which then increases the prices.
So what we have been doing is engaging the import suppliers, which are your maize producers, millers, as well as soya and sunflower producers to make sure that we expand the area of production, such that there is a readily available market for such products for our industry. Thank you very much.
Ms N P MAHLO: Hon Chair, I just wanted to ask the Minister as a follow-up question, has the department investigated the possibility of cheaper feedstock for the poultry sector, and has the department engaged in research to find alternative feed sources that are more affordable to produce locally in South Africa? Thank you.
The MINISTER OF AGRICULTURE, LAND REFORM AND RURAL
DEVELOPMENT: Thank you very much, hon Mahlo for the follow-up question. It is important for me to indicate that in the past two years, we’ve worked together with the industry as well as labour to look at how we can develop the poultry industry in South Africa in a manner that is sustainable for both exports and imports where necessary. We know at the moment that we have got more imports because of the cheaper cost of production in other regions.
Similarly, we also have imports of various parts or cuts in the meat that South Africans eat rather than in the other jurisdictions. For instance, South Africans like drumsticks and thighs more, whereas in other jurisdictions they would eat white meat, but unfortunately, the South African industry strategy is to produce the entire meat and even its packaging for selling, they would not do the segmentation, which works
well if you want to get into the export industry. As part of that discussion, I've indicated the expansion for the area of production of feedstock. The question you're asking is whether we have done some research on alternative feedstock that would assist in bringing down the cost of production for poultry. I must say that the current assessment working with the industry is that the best import is still soya, maize and sunflower. We can explore other opportunities of looking at what others may be, but what is important is that those players who are in the industry must be comfortable about those alternatives, as well as the consumers must feel comfortable as to what goes into the meat. Thank you very much.
Ms T M MBABAMA: Thank you, hon Chair, hon Minister, you didn't answer the second part of hon Mahlo’s question, which talks about strategy, but I assume that you do have a strategy in your department. The question I'd like to ask you is, in that strategy for expanding poultry farming in the Republic, what percentage of the grant component in the blended finance scheme is aimed at assisting small and medium-sized poultry producers to enter the sector, thus breaking the barriers caused by high import costs such as feed, which accounts for almost 70% of total production costs? Thank you.
The MINISTER OF AGRICULTURE, LAND REFORM AND RURAL
DEVELOPMENT: Thank you very much, hon Mbabama for that follow- up question. Indeed, you are right. The Poultry Master Plan is the strategy that we are using to be able to grow the poultry industry, and within that, we are looking at growing the
small-scale poultry farmers and looking at local production networks. We know and we've been speaking with the industry on contract farming, which is done by your bigger companies such as Astral and others who are working with smaller producers on contracts to be able to offer them market access to their industry. We're also looking at how we could supply affordable protein, which is another element that will go into the feed but produced locally as opposed to imported.
With respect to blended finance, the Department of Agriculture put in R1 billion in the last two years, and the Industrial Development Corporation complemented that with a billion rand, and that mostly targeted two sectors, poultry and livestock.
So, in terms of percentage, one may then check how the IDC, who is one of the partners with whom we are working on this programme, has determined the percentage between livestock and poultry farming. Thank you very much.
Mr N S MATIASE: Hon Chair, there are multiple challenges that constrain the poultry sector in the country. The rising feed costs are just but one of the many. These challenges include import penetration and dumping of chickens into the South African market, rising electricity tariffs, access to reliable supply of electricity, exchange rate fluctuations and amongst others, access to finance and markets, especially for small- scale producers. How do the Minister and the department, together with your colleagues in the executive intend to address these challenges to protect the South African poultry sector and to offset the long-term industry sustainability, job creation and food security to improve the competitiveness of the various segments of the value chain, especially those aimed at lowering feed cost? Hon Chairperson, thank you so much.
The MINISTER OF AGRICULTURE, LAND REFORM AND RURAL
DEVELOPMENT: Thank you very much, hon House Chair and hon members, the question which has now been posed relates to the broader challenges that the poultry sector faces, is energy, as the hon member has indicated, the issue of dumping and I would add the issues of animal health. With respect to addressing the issue of energy, which is another primary input into the production cost of poultry, we have launched, and it
is an operation, a blended finance scheme with the Land Bank on the Agro Energy Fund that we worked on with the industry to look at how we can assist those participants in poultry production to move away to other alternative energy sources as opposed to relying on Eskom in particular.
We have been working together with the Department of Trade, Industry and Competition to address the issue of anti-dumping which has been done already by the Minister of Trade, Industry and Competition to make sure that we prevent or reduce the level of dumping in our industry. On animal health, as we have seen with the avian flu challenge, we are working with the industry to improve biosecurity on our poultry farms and generally to other farms to make sure that we improve the capability of our farmers in this commodity. Thank you very much.
IsiZulu:
Inkosi R N CEBEKHULU: Ngiyabonga, Sihlalo, mhlonishwa, kunephuzu elibalekelwayo ngokusebenza emnyangweni. Kuyiqiniso elingenakuphikwa ukuthi lo mkhiqizo ongena ngaphakathi usuka emazweni la khona oHulumeni bakhona bebaxhasile abalimi. Izwe lakithi libonakala lingenakho ukuthi baxhaswe balimi ukuze
bakwazi nabo ukuthi bakhiqize imikhiqizo yabo ngokulinganayo namazwe angaphandle.
Ngokomnyango wakho, mhlonishwa, ubona ukuthi sixazululo sini esingasiza ekutheni nalaba bakithi abasanda kungena emkhakheni wezolimo nokukhiqiza, ikakhulukazi laba abakhiqiza izinkukhu bakwazi ukungena nabo ezimakethe kungabi nje bona badayisela thina emakhaya nasemihloweni ngoba sizibona sigijima nezinkukhu emiholweni uma abantu behola. Ngiyabonga.
UNGQONGQOSHE WEZOLIMO, UKUBUYISWA KOMHLABA KANYE NOKUTHUTHUKISWA KWEZINDAWO ZASEMAKHAYA: Ngiyabonga, lungu
elihloniphekile, impela lo mbuzo owubuzayo futhi uphawula ubaluleke kakhulu mayelana nokuthi uma sibheka iNingizimu Afrika ngo-1996 uma singena siba yingxenye ye-World Trade Organization, WTO, ziningi izinto esazenza engingasho ukuthi zibe nokuthikameza, ikakhulukazi abalimi abasafufusayo.
Ukubeka kwethu, ngingasho izincomo, kuleliya Komidi loMhlaba lezokuHwebelana, sasuke sanciphisa kakhulu amazinga okuxhasa abalimi bethu, ikakhulukazi phecelezi, ngolukaJoji ulimi, i- domestic support.
Lokho siyakubuyekeza manje sinamanye amazwe ngoba akuthina kuphela, izolo nje zikhuluma bengisemhlanganweni, sikulo leli
komidi le-WTO lapho besincoma ukuthi njengoba singakayiqedi ingxoxo yokuthi sivule ezolimo, ikakhulukazi emhlabeni wakithi
... trade liberalisation kwezolimo. Kumele sibuyele emuva, ikakhulukazi amazwe asafufusayo njengathi ukuthi sibheke futhi sihlaziye ukuthi singavuleleka kanjani singamazwe sikwazi ukuthi sibaxhase ngokufanele abalimi bethu ukuze bakwazi nabo ukuthuthuka. Ngiyabonga.
Question 819:
IsiXhosa:
UMPHATHISWA WEZEZIMALI: Undithatha amathuba ke lo. Kodwa ndiza kumphendula ngesiNgesi eside into ebekufaneleke ukuba ndiyiphendula ngesivakalisi esinye.
English:
As the honourable member will know, the Minister of Finance uses the annual February budget as a tool that outlines government and Cabinet decisions on the Fiscal Framework, which includes, among other things, expenditures, borrowing and tax measures. Every budget goes through a process of consultation and authorisation within the government structures, such as the Ministers’ Cabinet on the Budget, an ultimate approved by Cabinet before being finalised. As such, no prior definitive guidance on which take instruments will be
subject to potential increases, can be provided before such processes are undertaken and the budget is tabled before the National Assembly.
In the Medium-Term Budget Policy Statement, the Minister has already given an indication that more direct revenue increases will be introduced to support fiscal consolidation. Also note that government does not ordinarily uses occasion of the Medium-Term Budget Policy Statement as a platform to provide any specific measures related to taxes. As indicated in the recent Medium-Term Budget Policy Statement, government has proposed only moderate tax revenue measures to raise additional revenue of R15 billion in 2024-25 given the extent of fiscal consolidation required.
IsiXhosa:
Ungandibuzi ke ukuba ndiza kuzithatha phi le R15 yezigidi zezigidi kuba andizi kukuxelela.
English:
The amount represents about 0,81% of the revised loss tax revenue estimated for 2024-25 of R1,854 billion. It is not anticipated that the measures that will be considered will help substantial impact on the economy. It is customary that
takes proposals which provide definitive guidance the hon members seeking, are only tabled in the February budget, and there should be no expectation that it will be done otherwise unless in exceptional circumstances, like those that prevailed during the COVID-19 pandemic. In short, wait for 21 February when we table the main budget. I should have said that sentence only, but I decided because of the Parliament Rules
...
IsiXhosa:
... ukuba ndikhe ndikunike isiNgesi eside.
Dr D T GEORGE: Thank you very much, Minister, for your very comprehensive reply that was longer than one sentence. I did ask the question because battling South African households are deeply concerned about putting enough food on the table and obviously concerned about having to pay more tax next year.
But yes, as you say, we will have to see what happens in February, but certainly we would not support any tax increases.
By not being clear on tax policy, government is creating uncertainty over revenue expectations. We know that government met with the Reserve Bank Governor to discuss access to the
gold and foreign exchange contingency reserve account, currently valued at approximately R459 billion. The governor has already said that accessing this reserve ... [Sound muted]
IsiXhosa:
ILUNGU ELIHLONIPHEKILEYO: Sihlalo weNdlu asimva uMphathiswa.
An HON MEMBER: I thought that that was the only one.
The HOUSE CHAIRPERSON (Ms M G Boroto): Hon Minister, yes ...
The MINISTER OF FINANCE: Is it a problem with the ...
IsiZulu:
USIHLALO WENDLU (Nk M G Boroto): Hhayi, khulumela kuwo umbhobho loyo, ukude nawe.
English:
Mr Singh, your hand is up. Is it about the audibility also?
Mr N SINGH: Yes, yes, yes. I don’t know if we can ... I can hear you now. Thank you.
The HOUSE CHAIRPERSON (Ms M G Boroto): I think we are rectifying that, okay.
The MINISTER OF FINANCE: The point is, there’s no truth that there’s no clarity about fiscal policy, because we have not announced tax measures beforehand, it has never happened. It has never happened. And no one has ever complained about the absence of clarity about fiscal policy because South Africans are aware that tax proposals are tabled once and once only, during the budget process. That’s the first point.
The second point, I am not going to answer the question whether I am going to raid the Reserve Bank or not. What the hon Minister is referring to is contained in section 28 of the Reserve Bank Act. That Act clearly stipulates that, the foreign exchange reserves and any excess of those reserves belongs to the National Treasury. We have not made any statement even in the Medium-Term Budget Policy Statement.To the extent that there are accesses in reserves, we have not made a statement. We are muted on that point for now.
IsiXhosa:
Khawukhe uphumle ke mntwana wasekhaya, musa ukuzingxamela ezi zinto kuba uzingxamele zonke.
Mr M J MASWANGANYI: Minister, given that the principal objective of taxation is for government to generate sufficient revenue to finance policy objectives which is derived from a popular majority mandate that it is given and as is reflected in the Medium-Term Budget Policy Statement, MTBPS. Public hearings into revenue proposal this year once again have raised the prospects and ability of raising far greater revenue. Why is it that the Treasury has not opted through SA Revenue Service, Sars to be far more aggressive in raising revenue from the identified sources that it has at its disposal? I thank you.
The MINISTER OF FINANCE: We made the point in tabling the budget, that there has been an increase in aggressive collection of taxes by Sars, in particular the increase in compliance by Sars. So that is a product of this aggressive stance taken by Sars. In this financial year, we have provided Sars with R1 billion, whose main activity is to achieve that aggressiveness referred to by hon Maswanganyi. They have given us a specific target, which I’m not at liberty at the moment to disclose but at the appropriate time, we will disclose that target. Thank you for asking that question. Thank you.
IsiXhosa:
Mr M MANYI: Madib’omde, masithethe inyani.
English:
The market uncertainty and investment planning challenges are not caused by economic policy ambiguities and the absence of a definitive guidance. The National Treasury is very clear in its line of march and that is, privatise state-owned enterprises SOES, outsource as much as you can, including basic essential services such as water, sanitation, housing and other services. This is very clear from the Operation Vulindlela programme of government that has now been adopted. What we need to know, however ... [Interjections.]
The HOUSE CHAIRPERSON (Ms M G Boroto): No, no, no hon Ntobongwana, please.
Mr M MANYI: The ANC people must be taught etiquette. This is very clear from the Operation Vulindlela programme that is now adopted by government. What you need to know, however Minister is this and this, and this talks to ambiguities that can affect consumer confidence crisis: Is the Minister and the National Treasury saying that Cabinet, the ANC, His Excellency the former President Mbeki and all concerned about the rand
... [Inaudible] ... are all wrong, and it is only National Treasury that is right?
The MINISTER OF FINANCE: I am trying to figure out hon Chairperson how all of that fits to the tax proposal. I am trying to figure out how does all of that fit to the original question. I need some guidance.
The HOUSE CHAIRPERSON (Ms M G Boroto): Hon Minister, you know better. I it’s a new question, it is your prerogative whether you respond or you don’t.
The MINISTER OF FINANCE: I think it is a completely new question.
Mr M MANYI: You mean, it is a difficult question for you to answer.
The HOUSE CHAIRPERSON (Ms M G Boroto): No, no, no hon Manyi, don’t do that. No, hon ... you know the Rules. I’ve been saying them all along.
The MINISTER OF FINANCE: Let me help hon Manyi. That question relates to structural reforms. We are not dealing about structural reforms for now.
The HOUSE CHAIRPERSON (Ms M G Boroto): Thank you. If you if you read 142(6), it will tell you what to do when you ask a follow-up question, irrespective of a new question. It is there, clear. What is it hon Khawula?
IsiZulu:
Nk M S KHAWULA: Siyagodola.
The HOUSE CHAIRPERSON (Ms M G Boroto): Okay. I did complain before and I realised that some people want warmth in the coldness. I decided to be quiet. Hon Hendricks.
Mr M G E HENDRICKS: Minister, tax hikes are on the radar and government and the Executive are blamed by the hon Dr George for the hampering of economic growth and breakdown of consumer confidence. Should the banks manipulating the rand and some captains of industry who wants to create a climate for regime change, not be blamed as articulated by the Minister in the Presidency? And to avoid the tax hikes that hon George is
worried about, what about rand manipulating tax for banks? Would you consider this for next year?
The HOUSE CHAIRPERSON (Ms M G Boroto): Proceed hon Minister, it is in your court.
The MINISTER OF FINANCE: I am in an unfortunate position because I’ve been asked irrelevant questions to the original one. It is irrelevant.
The HOUSE CHAIRPERSON (Ms M G Boroto): Thank you. That’s what I want you to do.
The MINISTER OF FINANCE: But what I can say to the hon member to his benefit, Cabinet would issue a statement in this regard.
Question 790:
The MINISTER OF MINERAL RESOURCES AND ENERGY: Hon Chairperson
and hon members, as was recommended by the portfolio committee, the department undertook a comprehensive review of the basic fuel price. We undertook it and is used to make a monthly price adjustment on the country. The basic fuel price, BFP, has and continues to serve as the reliable balance for
the need of the interest of the consumer and the need of the manufacturer. And it is used by all importers of refined petroleum products.
The BFP review indicates that the 15% premium that had been imposed at the height of piracy in the routes used for shipping fuel was no longer necessary and therefore the 15% premium was removed from freight cost component of the basic fuel price. So, that 15% is no longer an issue. It's not there, it was removed.
The removed 15% premium actually reduced the fuel price by 18 cents at the time. That is 80 cents per litre at the time.
That was the effect of that reduction. Now, the basic fuel price is an import pricing principle that all countries that import petroleum products use as a methodology to calculate the import cost.
Firstly, the cost of the fuel will be based on trades that are applicable to a specific country. Secondly, the freight cost, which is the cost of shipping from international market to receiving portion entry into the country. The coastal stock holding, and the financing will be different based on each country's security of supply policy.
Otherwise, all the elements of import where disparity price increased in South Africa are similar and the BFP therefore makes provision for the importers to hold stock for 25 days at the coastal storage facility. The 25 days stock should be seen as a buffer stock that has to be held in case there are global fuel supply challenges.
Holding that stock for 25 days requires ongoing financing of the stock and the stock is financed through prime rate minus 2% and the 25 days stock cannot be equated to stock that is used on an ongoing basis it is buffer stock. Thank you.
Ms N P TYOBEKA-MAKEKE: House Chair, we are travelling as the Portfolio Committee of Minerals and Energy. Follow-up question: Hon Minister, do the oil companies physically hold products stock equivalent to 25 days for the stock financing element, and is this stock holding reported to the department? I thank you.
The MINISTER OF MINERAL RESOURCES AND ENERGY: It is the
requirement, and the assumption is that they keep the stock. But from time to time there is an inspection of whether the stock is kept. We have not found major deviations from that.
Therefore, our assumption is that companies do keep the 25-day stock as a buffer in case of challenges in the market.
Mr K J MILEHAM: Minister, a year, and a half ago, I wrote you a letter co-signed by more than 130 000 South Africans in which I requested that you and the Minister of Finance deregulate the fuel price and slash the exorbitant fuel taxes in order to minimise the impact of fuel price increases on the cost of living of ordinary South Africans.
Now, of course, the fuel price doesn't affect ANC Ministers in your government sponsored vehicles living in your government sponsored homes, but ordinary people are suffering at the spiralling fuel costs. What has your department done to remove the taxes and levies included in the basic fuel price, which currently funds the corruption and maladministration of the ANC government and make fuel more affordable for all South Africans? Thank you.
The MINISTER OF MINERAL RESOURCES AND ENERGY: I always give
you this answer hon Mileham. I will give it to you again. One of the things that I know that I'm in government now is that tax finance funding money belongs to the Treasurer, that is the Minister of Finance. So, the fuel tax and fuel levy belong
to the Minister of Finance, and I have no authority to remove it.
Just listen. Just listen. One time I had a discussion on this matter, and I said to them, why don't we do this, and scrub rust and the conclusion was that it will be hard hitting to the poor than to the elite. And therefore, it's up to us to think that we can't pay that tax to cushion the implication for the poor. And that is the proposal you're making that remove that tax, if the poor is involved in an accident, they must sit to finish. And I don't think it's a wise advice, hon Mileham.
Prof C T MSIMANG: Hon Minister, have there been any steps taken thus far by your department to implement said recommendations of the portfolio committee? If not, why not and if so, what are the relevant details? Thank you, hon House Chair.
The MINISTER OF MINERAL RESOURCES AND ENERGY: I think the hon
member didn't listen to the response. The response was, as was recommended by the portfolio committee, the department undertook the comprehensive review of the basic fuel price methodology. We also gave the response that as a result of
that, the 15% was removed, saving 18 cents per litre to the consumer. So that answer is still relevant.
Mr K CEZA: Chairperson?
The HOUSE CHAIRPERSON (Ms M G Boroto): Hon Ceza, what’s wrong? I’m done with that question. You were not there to respond as I called you more than twice. I’m now on the next question Employment and Labour by the hon Heron. The hon the Minister?
Question 826:
The MINISTER OF EMPLOYMENT AND LABOUR: Thank you, hon Herron for this very important question which reflects thinking outside of the box, in order to deal with the fiscal constraints. Let me start by saying I shudder to think what would have happened if we did not have Unemployment Insurance Fund, UIF during the COVID-19 induced lockdown. The UIF contributed R65 billion to 5 million laid off workers and their families during the COVID-19 pandemic. It saved businesses. It protected jobs. It became a platform for the country to rise again.
Hon Herron as you know, both funds receive their contributions from their employers and employees. The UIF in particular, is
funded by 2% of the salaries where the employees and employers contribute equally. So, the economy, of course it’s not doing well, which means the demand for the UIF is high. Therefore, it needs to be fully funded. On the other hand, Compensation Fund is funded by the employer’s contribution. Both funds are described as defined contributions and defined benefits.
The use of the fund is prescribed in both Acts that established them. Both funds are looking at contributing towards the 2 million jobs plan to reduce unemployment. I’m very mindful that the department, public entities, and state agencies have the obligation to spend allocated budgets prudently, and according to the relevant laws and regulations in whenever we want to use or want to tap from those funds. We must follow proper processes of consultations and approvals.
Thank you.
Mr B N HERRON: Minister, I think we do have to acknowledge the impact of the COVID-19 or the UIF funds in the COVID-19 crisis, the Temporary Employee Relief Scheme, Ters, funds and the role that the UIF excess played. But given our low economic growth and poor job creation reality, the state should be responding with some sort of appropriate stimulus
package. A package that would increase domestic demand, investment and employment.
We have read about the plan to use UIF funds to create
2 million jobs before the end of March at a cost to the UIF for R15 billion. But if those jobs are Expanded Public Works Programme, EPWP or temporary jobs, then we should really regard them as poverty alleviation interventions rather than job creation. But there are other options that we could consider for the use of the UIF excess funds that have accumulated.
So, has the government considered the impact of a stimulus package using UIF accumulated excess funds that includes a contributions holiday? This would mean an effective increase in both workers and employers’ revenues or incomes. It could stimulate demand and provide much protection against higher food prices, and it could be a stimulus to the economy. Thank you.
The MINISTER OF EMPLOYMENT AND LABOUR: Thank you very much, hon Herron. The UIF currently is funding a number of projects. The Temporary Employer Employee Relief Scheme, which is Ters, which is processed through the CCMA. It is a salary relief
scheme to help companies turn around during this period of distress. That’s very important to know that. And also, through the Industrial Development Corporation, IDC, we are funding companies also in distress. Productivity SA assist companies with the turn around solutions. So, there are various programmes. Some are short term which you would call them work readiness programmes for the young people to be able to get into those jobs. Some are medium term, and some are long term programmes.
Amongst other things which we are debating now, we are also talking about the issue of the wage subsidy where we have to assist in some of the companies paying a particular percentage of the wages in order to be able to absorb a lot of people.
Those are debates. So even the R15 billion people are talking about is not money which has been used, it is the thinking which we’ve been talking about. The proposals we’re talking about, which still has to go through the different structures for approval. I want to emphasise that because other people are even talking about ... you want to use this. Talking about
2 million jobs within a period of four months. It’s not there.
It’s nonsense what they are saying. The issue is government programmes, whether there are elections or no elections,
whether it’s the end of the financial year or not, are continuing. Thank you.
Mr M J WOLMAANS: Minister, in light of the answers that you have just given, and in light of the possible utilisation of the funds in question, as far as this is concerned, what are the plans that you have in place to utilise these funds in the event these funds cannot be utilised in assisting the fiscus reduce the fiscal consolidation? What plans are there in place currently or in the future?
The MINISTER OF EMPLOYMENT AND LABOUR: No, our plans are very clear. We’ve talked about ... as part of our UIF Labour Activation Programmes, we have very important components. We have talked about the Employability Enhancement Programme, which enhances the employability of the unemployed and enables entrepreneurship and preserve jobs by integrating the unemployed people back to the labour market. We’ve talked about business turn around and recovery, which we want to implement through the Productivity SA, and is intended to enhance the productive capacity and operational efficiencies of the various enterprises throughout the business life cycle in order to preserve the jobs.
But we are also claiming with other departments – about seven departments. We are talking about workplace readiness. We are talking about skills development. We are also talking about partnerships with the private sector. We are hard in discussions with the private sector under the programme which is co-ordinated by the President with the CEOs. The issue of job creation. The issue of work readiness and skills development is part of all the plans which we are talking about. Thank you very much.
Dr M J CARDO: Chair, let me just say that given this government’s track record of corruption and waste, as well as the policy administrative state of UIF and the Compensation Fund, many claimants don’t receive their benefits. Giving the state the keys to surplus funds in order to ease fiscal constraints is probably not a good idea. Minister, we learn from media reports, and we’ve heard it echoed here today, that you’ve instructed the department to spend R15 billion in UIF and Labour Activation Programme funds to create these
2 million so-called work opportunities before the end of the financial year in March.
With December being a dead month, that amounts to blowing R15 billion in a very short space of time. And we all know
that these short-term work opportunities are not real jobs. But clearly you are in panic mode, having failed to meet your job creation targets and you’re now trying to shore up the ANC’s vote ahead of next year’s elections. Minister, can you tell this House why this mad idea is not a recipe for ... [Inaudible.] ... looting, and how it will be different to the capital deal? [Time expired.]
The MINISTER OF EMPLOYMENT AND LABOUR: Chairperson, thanks to the hon member. You have said -in the very same Parliament – that unemployment is one of the biggest crises we face. You have said in this Parliament. Most of your members have said that when they are debating the economy. When we come up with interventions to massify you are talking about waste. You don’t know what you’re talking about.
We have agreed that we must respond to the challenge of unemployment. We must massify the programmes. And we are talking about we are left with three months. The problems of government are multi year. Some of the proposals here, we are talking about a one-year programme. We are talking about two years. We are talking about three years. We are not talking about the end of the financial year. We are talking about
multiyear programmes to respond to the unemployment in this particular country.
Even the R15 billion you’re talking about ... please don’t howl, just listen because I listened to you. You see, the R15 billion which you are talking about is the proposals to say as part of the massification we have to add these
programmes. And we have said, before we can be able to recall that money, we have to go through the processes in order to be able to make sure that money has been approved by the necessary structures. It’s as simple as that. It has nothing to do with what you are saying that it’s a corrupt scheme.
Unemployment is the biggest crisis now as we speak. We can’t just be sitting with the resources invested in some companies when we’re faced with the biggest problem in the country.
Thank you.
Question 791:
The MINISTER OF EMPLOYMENT AND LABOUR: Chairperson, the response to hon Mdabe is that the plans that are in place, have already begun to deliver in that, the audited annual financial statements of the previous year for the Unemployment Insurance Fund, UIF, was tabled in Parliament on 31 October 2023. The plans are now working towards getting the 2022-23
audited financial statement report being tabled in Parliament. The 2022-23 annual financial statements and the performance report will be submitted to the Auditor-General on 30 November 2023.
So, the Auditor-General’s audit takes two months to be finalised, but due to the December holidays, we anticipate that it may take three months, and based on the above activities, it is anticipated that the 2023 annual report will be ready not later than the end of 20 June 2024. When it comes to the Compensation Fund, CF, in 2022, the entity requested the postponement of the 2021-22 audit to address prior or the prior year errors. So, the 2022 financial statement was submitted on the 31 May 2023, and the audit was finalised on 6 September 2023. So, the 2023 financials can only be finalised once the CF receives the 2021-22 audited financial statements from the Auditor-General.
The 2022-23 financials, therefore, were submitted to the Auditor-General on 31 October 2023 for audit, and the Auditor- General is currently conducting that 2022-23 audit. The anticipated timeline for completing the audit is end of January 2024. So, the annual report will be submitted end of March 2023 which is the accepted two months’ timeline required
for CF to incorporate the updated financials from the audit and allow the Auditor-General to conduct a further audit on the annual report before it is tabled in Parliament. Thank you, Chairperson.
Mr M NONTSELE: House Chair, the follow-up question is as follows. Let me first thank you, hon Minister, for your detailed response to my question. Hon Minister, the question is whether you are considering reforming the two entities, and if so, how will this improve efficiency in the entities? Thank you, House Chair.
The MINISTER OF EMPLOYMENT AND LABOUR: Comrade Nontsele, right at the beginning of my term I indicated that the two funds have to be dragged out of the deep hole. Currently, we are working on two projects. For the first project we appointed
PricewaterhouseCoopers, PwC, to review the current UIF and CF structures and propose a structure that would enable both funds to be fit for purpose. So, the report has been finalised and presented to the Cabinet for approval, and as the Minister, I believe that the independent project management team will be able to implement the proposed structure, hence I sought the approval from the Cabinet, which was granted.
The second project is the separation of the two funds from the department, and for this project, we are using the Government Technical Advisory Centre, GTAC, at National Treasurer to assist in looking at the permutations that can be considered to make this possible. The GTAC has submitted and presented their first report for consideration. So, clearly work is being done in order to fundamentally relook at the structures, the systems, the skills and so on. Unless we do that in a systematic way, we are not going to be able to turn those funds around.
Mr M BAGRAIM: Minister, I know the answer, but it begs the question. Do you really not have the capacity to have an audit done immediately? Minister, are you covering up for the well- connected ANC cadres who have sticky fingers? I’m not waving a small bag of coins like a miserable weasel, I’m referring to possible grand scale theft of R5 billion, an allegation of
R3 billion, and now the mother of all ... [Interjections.]
The ACTING HOUSE CHAIRPERSON (Ms R M M Lesoma): Hon Matuba. Can the ICT just take the hon member out of the system, please. Thank you.
Mr M BAGRAIM: Sorry?
The ACTING HOUSE CHAIRPERSON (Ms R M M Lesoma): No, she’s out now. It’s fine, you may proceed.
Mr M BAGRAIM: So, I’m referring to the grand scale theft of R5 billion, R3 billion, and now the mother of all crimes, R15 billion. A billion here and a billion there, soon we’re talking about serious money, Minister. What are you doing about it?
The MINISTER OF EMPLOYMENT AND LABOUR: You see ...
[Interjections.]
The ACTING HOUSE CHAIRPERSON (Ms R M M Lesoma): Order, hon members. It’s too loud, you can heck, but you can’t just converse.
The MINISTER OF EMPLOYMENT AND LABOUR: You’re talking about grand scale theft. If there was. If that was allowed, I would not be in court today to stop that. The fact that I am in court ... [Interjections.] ... No, don’t worry, I have to follow the processes. Before we can be able to go to court, I had to look for very clear legal opinions from three different counsel to be able to say when we go to court, we’re very sure of what we are talking about, and these are the processes
which must be followed. You must interview everybody before you come to a conclusion.
So, this grand scale theft which you’re talking about, I'm not sure what you mean. About the R15 billion, you are just making a lot of propaganda which has not even been approved, which we have not started using it. I’m not sure what you’re talking about. Thank you.
Ms H DENNER: Hon Minister, you and I have had this conversation at one of our portfolio committee meetings, with regards to the problem with staff within the UIF and Compensation Fund who do not actually do what they are expected to do, and you’ve mentioned now that the company was appointed to look at the at the systemic overall of the structures of the UIF, for instance, but there’s just too many plans and strategies hanging in the air.
Now, you have spoken out against calls for the Unemployment Insurance Fund to be placed under administration. So, I’d like to know, Minister. Do you believe that the management overall will address the problems at the UIF, and if so, how will this be affected if the fund is not placed under administration, and if not, what is the root cause and how will it be
addressed in order to solve the problems at the UIF, so people can get the necessary services they need from this fund? Thank you, Chair.
The ACTING HOUSE CHAIRPERSON (Ms R M M Lesoma): Hon Minister, you’ll use your discretion because there are five questions that have been asked.
The MINISTER OF EMPLOYMENT AND LABOUR: No, no, you see, the
problem hon Denner does not understand is that here are not too many plans, there’s only one plan, a plan which has been informed by a detailed diagnostic conducted by a reputable company, PwC, which looks into the different elements. It looks at the structure, the strategy, the skills and looks at the people. These are the areas which we are looking at, and we have agreed in order to turn this around. Yes, there’s a lot of limitations of the people who are inside that, because it’s like we’re running a bank or an insurance company.
The skills which you need to run those entities, are the skills which are outside the private sector. That’s why we are now talking about a project management office, which is going to pull those skills seconded from the private sector, who are going to also help us and work with those who are inside, in
order to turn this around. We’ve done it before, and it has been done in public works and we are continuing with that particular issue to say that the partnerships with the private sector, with people with the necessary skills. It is going to help us. It’s only one project which is trying to turn these two funds around, not many projects. Thank you.
Ms C N MKHONTO: Minister, you are talking about the restructuring of the UIF and the Compensation Fund. What will come first? Is it the R15 billion job stimulus or will it be the restructuring of the two funds, and if the stimulus will come first according to your plans or what you are envisaging, what are the preventative measures do you have, to make sure that the people who defrauded the UIF through COVID-19, Temporary Employer-Employee Relief Scheme, TERS, they don’t repeat such activities? Thank you.
The MINISTER OF EMPLOYMENT AND LABOUR: Hon Mkhonto, nothing says that if you are restructuring or unbundling something, or a company business must stop, there’s nothing like that. When we continue restructuring, we’re not fixing it in the air. We must continue delivering the services, and we will deliver the services. The issue of job creation and the programmes which we’re running are going to continue, but what we have to do is
to ensure that we are tightening on our safety measures. That’s why, for instance, we have said in any programmes that we are now running, we are going to put what we call, top level project managers, as the audit firms.
We’re going to monitor on a quarterly basis we get the reports on how those companies are performing, and the financial reports on what they are doing. It’s part of the measures which we’re going to adopt. In the midst of the crisis of unemployment, there’s no way that we can say we’re just going to sit and say restructuring first until such time that we have finished that process. That process, we’ve been told by a number of people that it can take three to four or five years to restructure them to come to where you want them to be. The work must continue, and we must continue paying the benefits of the different workers which they contributed. Thank you.
Question 814:
The MINISTER OF FORESTRY, FISHERIES AND THE ENVIRONMENT: Thank
you very much, hon member. Let me at the outset say that our department is very concerned about the current crime spike that is taking place on Table Mountain. Since the 13th of November we have been working with the SA National Parks, SANParks, the SA Police Service, the City of Cape Town and the
Western Cape government to revive the Table Mountain Safety Forum and to share intelligence and officer deployment so that we can improve the safety outcomes on the mountain.
With regards to the concern that the team members of the Sea, Air, and Mountain, Seam, are operating without firearms due to the expiry of firearm licenses, this is not the case, and those who have suitable qualifications have got firearm licenses. There are others who at the moment are not compliant with the Firearms Control Act and on 22 and 23 November they underwent intensive formal reassessment so that they are compliant with the Firearms Control Act, and they can then be issued with the relevant firearms.
Mr D W BRYANT: Thank you for the response, Minister. Minister, in terms of the Seam unit, we also heard that the unit currently doesn’t have a manager in place and that the numbers are dropping quite significantly from 18 to 15 at present. We do know the City of Cape Town is already going above and beyond to provide additional security in the shape of law enforcement officers and other technology and has successfully helped to carry out many operations on and around the mountain. Therefore, this is the type of intergovernmental co-operation that we need. However, all spheres do need to
come to the party and Table Mountain National Park has an annual income of R300 million. Yet only R97 million, a third of that, actually being spent on the mountain in the face of growing concerns around safety.
According to the reports, the City of Cape Town’s calculated that with R200 million we can provide 400 dedicated and armed law enforcement officers for the mountain, which is five times more than a present. Can the Minister give more context as to why only a third of the revenue being generated is being spent on Table Mountain and what is being done to increase the number of rangers on the mountain? Thank you.
The MINISTER OF FORESTRY, FISHERIES AND THE ENVIRONMENT: Thank
you very much, hon Bryant. I think that what you know is that SANParks operates as a unit. We have 19 national parks. Table Mountain National Park, specifically Cape Point and the Boulders facility, are the big revenue generators and that revenue is shared as is the Kroger revenue with all the parks, all 19 parks. Therefore, that is why not all of that revenue is allocated, two Table Mountain National Park. One of the complexities we both know is that Table Mountain National Park is an open access park. Therefore, unlike other parks where we have fences, gate controls and so on, safety issues are much
more complicated, because we are concerned and because we believe that it is a very important tourist facility.
We have met with the Tourism Business Council of South Africa. We have asked them if they could assist us with funding the services of 84 supplementary security personnel over the period of the 1 December to 31 March. These security personnel will patrol. They will liaise with other security clusters.
They’ll protect property and staff. They’ll apprehend trespassers and report incidents. Therefore, we are hopeful that this partnership will take place and we are doing everything we can to security. Obviously, what we hope is by that stage we will have sorted out the qualifications of the Seam task members so that we would also have more armed personnel on the ground going forward. Thank you very.
Ms A GELA: Acting House Chair, I will take question on behalf of hon Mchunu. Minister, what is the plan in place to ensure the safety in key national parks which are areas of tourists’ destination, especially since we are heading into a festive season and what have been identified as challenges to be addressed to ensure safety in these areas? Thank you.
The MINISTER OF FORESTRY, FISHERIES AND THE ENVIRONMENT: Thank
you very much, hon member. I think I’ve already spoken about what we are doing with the Tourism Council to try and improve safety on Table Mountain and the surrounding national park.
Another crime hotspot as we all know is some of the approach roads to the Kruger National Park, particularly the road that goes to the Kruger gate. What we are doing there is, similarly, we are working with the Business Council to put well, they have, in fact, for some time put on security on that road. We have also done extensive liaison work with communities who live along that road to explain the importance of tourism for the revenue at the park and also for the jobs that the park provides for the surrounding communities as well as the opportunities the park provides for small medium and micro enterprises, SMMEs, to sell goods and services as well as tourism offerings in the park itself.
We found that this approach is quite good and that there has become more interest in the surrounding communities in helping to protect visitors travelling on that road and obviously we will be monitoring the situation closely to see whether this approach is yielding the desired results. Thank you very much.
Mr M N PAULSEN: Thank you, Acting House Chairperson, and thank you, Minister. Minister, the incidents of attacks in our national parks and mountains are not new. Therefore, there are new technologies, Minister, in the form of drone technologies that can, if implemented properly, drastically reduce, if not eradicate, criminality in our mountains. Has the department considered this technology to ensure the safety of visitors to our parks and mountains? I think, Minister, it was mentioned before in one of the previous questions that the antigovernment must not fear technology. It’s here to stay and it will get better, and it can make our lives better.
Therefore, what are the chances of your department adopting new technologies to provide for the safety and security of visitors and public to the national parks and game reserves? Thank you very much.
The MINISTER OF FORESTRY, FISHERIES AND THE ENVIRONMENT: Thank
you very much, hon Paulsen. I agree with you that it’s important not to fear technology. Part of the successes we’ve had in combating rhino poaching have been through the usage of more advanced technology. At the moment we do have a no-fly zone policy over the national parks because once you allow drones, you would understand that people who have wrong intentions can also be flying those drones. Therefore, there
is some feasibility going on with regard to the usage of drones. However, part of what we’ve got to work out is how would we then be able to enforce the no-fly policy so that it would only be drones that would be under our control that would be able to do that patrolling.
We would also have to look at what are the implications if you are doing aerial surveillance for the availability of that information as you know one of the concerns that we have, specifically in Kruger, is that there have been instances in the past of involvement of our own staff in rhino poaching. We agree that this is important technology that must be considered. We are looking into some pilot possibilities, but we’re also concerned about the unintended consequences, and we have to make sure that we can manage those appropriately first before we engage this new technology. Thank you.
Mr N SINGH: Thank you very much, Acting House Chairperson, and thank you, hon Minister, for your response. I think it is quite evident that the incidences of crime are getting relatively out of control in this very, very important area. I know everybody in South Africa and many outsides of South Africa when they visit Cape Town, they want to go to Table Mountain. Now, having said that, Minister, I think it’s
encouraging that you’ve indicated that you’ll increase rangers within the specific period.
Now, the question I will ask, will you consider that in your budget for next year you have more rangers that can be employed and that one supports what could be called a Table Mountain community watch, just like we have neighbourhood watches? I don’t know if there’s an established community watch in that area that can be supported. Thank you.
The MINISTER OF FORESTRY, FISHERIES AND THE ENVIRONMENT: Thank
you very much, hon Singh. I think that we have a very active community forum that works on Table Mountain National Park, and they have four subcommittees, one of which is a safety committee. I suppose the issue we would need to consider because what we know is that the attacks that are happening there currently are armed attacks.
We would have to consider the utilisation of reservists or other persons who would operate in a voluntary capacity but would have the right to be arms. And, of course, that’s a complicated issue because there’s also various human rights issues concerned. Therefore, we’re not opposed to the issue that you are suggesting, but we have to make sure that it
would be in terms of relevant legislation. Thank you very much.
Question 829:
The MINISTER OF COMMUNICATIONS AND DIGITAL TECHNOLOGIES: Hon
Chair and hon members, the relocation of iKwekwezi FM from Pretoria to Auckland Park was done as part of the South African Broadcasting Commission, SABC, cost cutting initiatives wherein a number of offices were identified throughout the country to be closed to save on rental and other operational costs. The Hatfield office was one of the identified offices, which meant that iKwekwezi FM would need to be relocated to Auckland Park. This move did not have any negative impact on the station’s delivery on its mandate or Communications Authority of South Africa, ICASA, regulations.
The station is licensed to broadcast quality news, which it is doing, educational and informative programmes in isiNdebele 24 hours per day, seven days a week. I also listen to it at times. Furthermore, the SABC implemented very minimal changes to the station’s programming operations. The station is still making use of the same transmitter network that it was using before the relocation, which means that it is still reaching its target audience.
In terms of the geographic spread of audiences, majority of the iKwekwezi FM listeners are spread across Mpumalanga, Gauteng and Limpopo, which means that anyone of these regions can play host to the station. Lastly, the development in technology which has been embraced by SABC allows listeners to access their favourite radio stations from anywhere in the world, even if iKwekwezi were to be put in London.
IsiNdebele:
Adv B J MKHWEBANE: Lotjhani, baba.
English:
According to ICASA regulations, when a license is issued, it is compulsory that the station should be where the listeners reside. So, in Mpumalanga it is so unfortunate that all the radio stations which are broadcasting in African languages are based in the provinces where their listeners are residing, all of them. It is only iKwekwezi and Ligwalagwala, the Mpumalanga combo, which were moved and were targeted by those cost cutting measure. This has an impact, irrespective of whether you are in London or wherever to listen to Ligwalagwala or iKwekwezi, but the fact of the matter is that this then robbed the people of Mpumalanga to have these two stations based in
either Witbank or Middelburg to create economic activities, not only about listening but also all the issues.
The quality is terrible to tell you, Minister, because that is the complain that is being received. So, why are these two discriminated when there are cost cutting measures and the benefits which the Mpumalanga people are losing as far as creating economic activity for the communities of Mpumalanga? Thank you.
The MINISTER OF COMMUNICATIONS AND DIGITAL TECHNOLOGIES: Thank
you, hon member ... [Interjections.] ...
IsiXhosa:
... khawuthule wena.
The ACTING HOUSE CHAIRPERSON (Ms R M M Lesoma): Hon members, you are too close to each other, we can hardly hear the Minister. Please, both sides.
The MINISTER OF COMMUNICATIONS AND DIGITAL TECHNOLOGIES: Hon
member, I don’t want to talk to the regulation that you have already spoken about because it is not something that I have applied my mind to. What is fundamental is that the audience
of iKwekwezi are entitled to the content that is generated in that station. As I am sitting here, sometimes I listen to 702 but I don’t even know where it is located. What is important is that when I switch on, I am able to listen to it and be able to get everything I want.
I am not sure whether it is the main concern of this audience that you are raising but if you have facts in that regard, you can actually forward them so that we can deal with them. Where we are they say that the target audience, the content and everything we are serving them as required. If you think there is a change in content, we are willing to entertain it if you can forward it. Thank you, hon member.
Mr V C XABA: House Chair, to the Minister, what has been the evident financial and nonfinancial benefits of moving iKwekwezi FM from the City of Tshwane to Auckland Park in Johannesburg? ... You can’t hear?
The ACTING HOUSE CHAIRPERSON (Ms R M M Lesoma): Hon member, you are too tall. Maybe if you can take my counsel to sit down so that the Minister can hear you.
Mr V C XABA: Minister, I hope you can hear me now. What has been the evident financial and nonfinancial benefits of moving iKwekwezi FM from the City of Tshwane to Auckland Park in Johannesburg? Thank you.
The MINISTER OF COMMUNICATIONS AND DIGITAL TECHNOLOGIES: We
have not looked at those statistics. Those are the statistics we need to follow, but that is a very important question. I also wanted to state that it is not only this station by the way that has been moved, hon Mkhwabane, even Tru FM from Bhisho has been moved.
The key issue, hon members, is that there are moments when the institution is going through tough times and you have to make tough choices to keep the stations afloat. When you make those choices, you take the choice that keeps the station afloat.
The decisions that we have taken around that station is what is keeping it afloat. However, we are always willing to learn from whatever information that makes us think better than the basis that led us to the decision that we have taken. Thanks.
Ms T BODLANI: Hon House Chairperson, to the Minister, as per your response, radio stations can operate from anywhere and be listened to by anyone across the world. Does the Minister plan
on moving any more stations? Which ones and by when? Thank you.
The MINISTER OF COMMUNICATIONS AND DIGITAL TECHNOLOGIES: As we
continue to help the entire SABC on the recovery course we take decisions depending on the situation at any given point in time. If tomorrow there is a need in consideration of the key factors that determine keeping SABC afloat, we will look at that when we cross the bridge. For now, we don’t have it at our disposal.
The ACTING HOUSE CHAIRPERSON (Ms R M M Lesoma): Thank you, hon Minister. I think there is an hon member struggling with their gadget and there is music coming through. The last question which is the last question will be asked by hon Z Majozi.
Ms Z MAJOZI: Hon Chairperson, to the hon Minister, the South African Broadcasting Commission stated that the relocation of iKwekwezi radio station does not alter the entity’s strategy for the station as the decision was based on minimising operational costs. Considering this, what is the strategy the entity has for the radio station? Thank you.
The MINISTER OF COMMUNICATIONS AND DIGITAL TECHNOLOGIES: I am
not sure if I heard the hon member, I have challenges ...
The ACTING HOUSE CHAIRPERSON (Ms R M M Lesoma): Unfortunately, she is not going to repeat it.
The MINISTER OF COMMUNICATIONS AND DIGITAL TECHNOLOGIES: Huh?
The ACTING HOUSE CHAIRPERSON (Ms R M M Lesoma): I am not going to allow her to repeat it.
The MINISTER OF COMMUNICATIONS AND DIGITAL TECHNOLOGIES: Can
she repeat?
The ACTING HOUSE CHAIRPERSON (Ms R M M Lesoma): Oh, you are asking that she repeat?
The MINISTER OF COMMUNICATIONS AND DIGITAL TECHNOLOGIES: Yes
...
The ACTING HOUSE CHAIRPERSON (Ms R M M Lesoma): Okay, that is fine. Hon Majozi, the Minister didn’t hear you. If you can just be slow because you are within your time. Hon Majozi, are you still on the platform?
Ms Z MAJOZI: Yes, thank you, Chairperson. Hon Minister, the South African Broadcasting Commission stated that the relocation of iKwekwezi radio station does not alter the entity’s strategy for the station as the decision was based on minimising operational costs. Considering this, what is the strategy the entity has for the radio station? Thank you, Chair.
The MINISTER OF COMMUNICATIONS AND DIGITAL TECHNOLOGIES: The
strategy of all the entities of the SABC are about delivering on the public mandate of the institution in line with the specific audience that you are allocated to. It applies to iKwekwezi FM in terms of culture, the diversity they must protect, informative exercise, ensuring that they broadcast the news, and they create opportunities for the audience to engage on South African matters. The strategy finds expression in that context.
Question 792:
The MINISTER IN THE PRESIDENCY FOR ELECTRICITY: Madam Chair,
just to mention that according to regulatory requirements, Eskom publishes a Transmission Development Plan, TDP, every year and this TDP has got a 10-year horizon. The TDP identifies infrastructure that is required to, amongst others,
keep abreast of load growth, comply with reliability, redundancy requirements, meet new generation integration requirements, and replace assets that are at end of life.
In the TDP 2022, Eskom identifies the 1009 projects requiring development and execution. This comprises 2207 expansion category projects and 802 refurbishment projects over this period. In the TDP 2022, the identified scope of broadly involves building 14 218 kilometres of power lines and 122 669 megavolt-amperes, MVA, of transformers. This infrastructure will be built in all provinces around the country, with the bulk of it being in the provinces such as the Northern Cape, Eastern Cape and the Western Cape that have the greatest potential for renewable energy power plants. And of course, we know that in these locations, transmission capacity is either depleted or on the verge of being depleted. Therefore, undermining our ability to exploit this resource endowment.
The Minister in the Presidency for Electricity co-hosted a Transmission Financing Seminar with the Johannesburg Stock Exchange and is currently finalizing a Cabinet submission on transmission financing pathways aimed at fast-tracking transmission infrastructure investments to support the anticipated growth in generation capacity and secure long-term
energy security. We will announce the financing options once Cabinet has pronounced itself.
The following are known. Firstly, it is that the Eskom balance sheet is severely constrained, and the fiscal risk matrix has deteriorated. Therefore, our ability to draw from the fiscus or to look at corporate financing is limited. We have every intention of dipping into the deep liquidity that is sitting with the private sector to make it possible for us to be able to meet the expansion and modernization requirements of transmission. This will be underpinned by a number of principles. The first one is that the state will remain the owner of transmission. Secondly, that whatever option we are taking should not place a disproportionate and onerous requirement on the end-user from a tariff point of view.
Lastly, that the system operator will be overall in charge of the management of the system, and this is how we will approach the expansion and modernization of transmission infrastructure by stepping into the deep liquidity that is sitting with the private sector. Thank you.
Mr K E MAGAXA: Thank you, hon Chair. Comrade Minister, does the government have any contingency plan in place for the construction of 3000 kilometres of transmission grid as part
of Eskom’s short-term turnaround objective if the National Transmission Company of South Africa does not get any lender concerned at all or the lender the concern is delayed?
The MINISTER IN THE PRESIDENCY FOR ELECTRICITY: Madam Chair, I
would like to make the point that in the foreseeable future and that, I mean, in the next three years, Eskom has got a sufficient capital requirement to be able to meet the expansion. But the rate at which we want to accelerate the expansion will require that we look at the additional sources outside the Eskom supported balance sheet. And it is for this reason that we are looking at multiplicity of options that will be available to us to ensure that we are able to aggressively expand and modernize the transmission so that we are able to accommodate the new sources of generation, in particular renewables that are located in areas of significant transmission capacity deficit.
As already mentioned, the key provinces are the Northern Cape, Eastern Cape and Western Cape. In a nutshell, we will try to strengthen the resources that lie with Eskom. As I said, Eskom has the necessary capital over the next three years, but the speed with which you want to develop the transmission infrastructure will force us to find other sources of funding.
That is why we are expanding the flow of those options to ensure that we go beyond the fiscus, we go beyond the Eskom balance sheet, and we tap into the liquidity that is sitting with the private sector. Thank you.
Mr K J MILEHAM: Thank you, House Chairperson. Minister, our transmission infrastructure is outdated and unable to meet demand due to the incompetence and mismanagement of the ANC. We saw this during the Renewable Energy Independent Power Producer Procurement Programme, REIPPPP Bid Window 6, where a number of potential independent power producers were disqualified due to lack of transmission capacity. So, your comments on investment in the transmission development plan are very welcome, and yet much of our grid remains tied up in allocations for projects such as Karpowership Minister Mantashe, which have not met the bidding criteria and are unlikely to ever see the light of day. In the face of fifth and sixth stage load shedding, what is your government doing to end these projects and free up grid resources for other independent power producers to connect more generation capacity to the grid as soon as possible?
The MINISTER IN THE PRESIDENCY FOR ELECTRICITY: Thank you very
much, hon Chair. I think your understanding of the
configuration of the South African power grid does not consider the historical context of the density of the power grid. Remember that the grid is configured so that the power stations are located at the mouth of the fuel source and in this case the fuel source is cheap and poor-quality coal located in the highlands. This is the reason for the density of the grid in these areas. So, there is no connection with the alleged mismanagement of the ANC.
It’s just an appreciation of the fuel source, and the kind of agenda we are pursuing so that we are able to create sufficient capacity to handle the growth of the country. The two things have nothing to do with each other, assuming your assertion is correct. But it is a fact of history and also of technology, simply the configuration of the grid.
When we come to the issues of power ship is a process that is spearheaded by the Independent Power Producers, IPP, Office. I have no business to enter into the space of a procurement. It is following its own regulatory processes. They must get the licenses as required. But as part of getting to financial clause, they had to get the grid access and they complied with the rules that govern our emergency procurement. So, it’s not my intention to reconfigure or revise the rules in the middle
of the game. It will find its way within the legal framework so it will be left to that legal framework. But to the extent that we want to connect a new renewable energy capacity, I have made the point in responding to hon Magaxa’s question that yes, we want to expand and modernize the grid by about 14 000 kilometres in the next 10 years and the concentration of the expansion and modernization will be in the Cape provinces. Thanks.
Mr M MANYI: Thank you, House Chair. Minister, the people of South Africa are nervous and suspicious. Could the Minister once and for all clarify the stance of government on the privatization of Eskom. The National Transmission Company of South Africa helps to bring more context into this. It’s like the World Bank has captured Eskom. What is the extent of the involvement of the World Bank on Eskom and why did the Minister need the consent of World Bank to do whatever restructuring the entity needed to do?
The MINISTER IN THE PRESIDENCY FOR ELECTRICITY: Thank you very
much ... I almost said, “bra Jimmy”. Yes, because I know him outside the room too. I apologize for that. I thought the original question was about the transmission. And I will confine myself to the issues of transmission in relation to
the dismemberment of Eskom and the undermining of vertical integration. As far as I remember, and this is a fact, there is no intention to privatize the South African transmission company. It will remain a subsidiary of Eskom. And as we know, Eskom is still a state-owned enterprise, an SOE, and the government is a 100% shareholder.
To ensure that we are able to establish a transmission company, we had to obtain three licenses. One is a transmission license and the other is an import and export license. The other is a trading license and these licenses have already been granted. The next step is to appoint the board of directors. Minister Gordhan is working hard in co- operation with the board... Obviously, being a subsidiary of Eskom Holdings, we need to ensure that we can appoint a board of directors. The Minister has publicly promised that this appointment will be made very soon.
In relation to the options that will be exercising, I did make the point earlier on that the underlying principles in us tapping into private sector liquidity will be, amongst others, the fact that the state will not be retrenched. By that I mean the state remains the sole custodian of the ownership of the transmission, and this is a best practice across the world. It
is a national strategic asset, and the state is not about to relinquish ownership of the national strategic asset. That’s the approach that we are taking. Thank you.
Mr S N SWART: Thank you, House Chair. The ACDP understands that significant additional capacity will be required and, of course, additional capital funding will be required to expand the transmission network. And Minister, I am sure you are aware that this could amount to hundreds of billions of rands over time. Minister, you have indicated that the use of private sector liquidity is an option for the future because of the constraints at Eskom and of course the Treasury. May I ask you what steps you will take with the Minister of Finance to ensure that Eskom or the transmission company to be established does not fall into debt if private sector liquidity is tapped? What steps will you take to ensure that the spiral of exorbitant debt servicing that we have already experienced in the past does not happen?
The MINISTER IN THE PRESIDENCY FOR ELECTRICITY: Hon Chair,
perhaps just to point out that last week Minister Creecy communicated the Cabinet’s decision on the Just Energy Transition Investment Plan and that there is a facility of more than $12 billion to help us realise the elements of a
just transition, if you will. That includes, first and foremost, the investment in transmission.
But that’s not limited to what the international partners group are offering. We think that this is a significant flow of financing that is required. Our own complications suggests that they will need upwards of R390 billion for us to be able to achieve this kind of ambition.
I want to commit myself and tell the House and the country that the decisions about what constitutes the investment and what the conditions for it are not imposed on us when we make that decision, but we make them in the interests of the state. So, everything is subordinate to the sovereign interest. And that is how we will enter this space. There will be no power that wants to dictate to us. We know very well what we have to do to develop the network. I have to say that there is a huge, insatiable appetite to invest in this area. But what I am saying is that we are not the only ones in the world looking for this kind of resource. It’s not that it’s only reserved for South Africa. Speed, agility and consideration of the socio-economic needs of the country are important.
Hon Swart, I really want to give you the assurance that all of those will be considered when we make these choice going into the future. Thanks, Madam Chair.
Question 785:
The MINISTER OF MINERAL RESOURCES AND ENERGY: Hon Chairperson
and hon members, the Environmental Impact Assessment, EIA process was undertaken in accordance with the National Environmental Management Act, 1998 Environmental Impact Assessment Regulations. So, nothing was shortcut, it was done according to prescriptions. The public participation process was conducted in terms of the principles of the National Environmental Management Act, Nema as amended. So, that was followed to the latter. The Department of Forestry, Fisheries and the Environment Public Participation Guidelines in terms of Nema, EIA Regulations, Department of Forestry, Fisheries and the Environment, Pretoria, those were followed to the latter.
As evidence in the record of decisions for the environmental authorisation, the public participation process was carried out in accordance with Regulation 41 and 44 of the Nema environmental assessment. The scoping report, Environmental Impact Assessment Report was subjected to a 30-day commenting
period. The interested and affected parties were notified and the project was advertised in newspapers. Several public consultations were held and consultations with various state departments and organs of state.
All comments from interested parties were addressed. So, this is very important as a question because after that, there were appeals after appeal until the affected company left our shores, it ended up in Côte d’Ivoire. They left us and they made discoveries in Côte d’Ivoire, and stopped were here. So, which is an issue of choices that we’re making as a country?
The department implements the National Environmental Management Act, Nema, which seeks to give effect to the provisions of section 24 of the Constitution.
The National Environmental Management Act amongst others serves as the general framework within which environmental management and medication plans must be formulated. Service guidelines by reference to which any organ of state must exercise any function when taking a decision in terms of the Act or any statutory provision concerning process of the environment. One of these hon... [Inaudible] ... is that whenever we approve those licenses, one of the issues that we
never take shortcuts on are the environmental imperatives that must be complied with. Everything else follows after that.
The impact assessment process considered various factors prescribed in in section 24 of Nema. These factors include compliance with Nema impact assessment, identification of mitigation measures, applicants’ ability to implement the mitigation measures and comply with the preferred financial provisions and considering comments of the organs of state to name a few.
All we are saying is that, when we approved the projects there, we took into account all the requirements of the law. There was no deviation and there was no request for any deviation. Thank you.
Mr S M JAFTA: Thank you hon Chair and to the Minister for the response. Hon Minister, can you then expand on the intersection between securing ecologically sustainable development and promoting justifiable economic and social development. I’m raising this question hon Minister because we have seen an increase in ecojustice and nongovernmental organisations, NGOs putting more emphasis on ecologically sustainable development while ignoring the primacy of
justifiable economic and social development, particularly in a country where the poor live below the poverty line. How can a fine balance be struck between these variables? I thank you.
The MINISTER OF MINERAL RESOURCES AND ENERGY: One of the
emphases we always put is that environmental considerations and developmental needs of a country must be balanced. So, in other words, you don’t just develop anyhow, irresponsibly. You take into account the environmental needs of society. But if you balance them, you will have development and you look after the environment. And our emphasis is that those two must coexist, because if they don’t coexist one dies, and the consequences are dire.
If we just push development and we ignore environmental needs, the society is going to pay the price. If we just look into environment and we kill development, then there’s a problem.
That is the reason that I’m one of the few people who is emphasising that, many of the environmental NGOs that stopped development are foreign funded. And that’s why I am putting the point that these NGOs must be registered. They must declare in transparent form their source of funding, because if we do that, we don’t kill them, we don’t stop them, but we
make them take responsibility for the action they do. Enkosi [Thank you.]
Mr S LUZIPO: Hon Chair, my apologies for not showing the face, we are still on the road. At the backdrop or background of the current Conference of Parties, COP28 that is in sessions as well as our commitment to ensure that we move from high carbon emission to low carbon emission, does the department have an equitable balance in terms of the economic efficiency and inclusive developmental objective on the one hand, as well as the potential threats to environment as well, in particular with regards to the gas exploration of the coast of KwaZulu- Natal?
I am raising this because there is a question whether the department does have a balance between developmental objectives as well as environmental compliance requirements. Thank you very much hon Chair.
The MINISTER OF MINERAL RESOURCES AND ENERGY: Let me be brief
on this one. The most important thing is you can’t move to the extremes. Any extreme will be dangerous for society. That’s why when we talk to people who are advocating movement from fossil fuel to renewables, those are extremes. You move from
one extreme to the other. I am propagating multi-pathways to development but keep your eye on the reduction of carbon emissions.
Reduce the carbon emissions but ensure that there is sustainable development and there is sustainable availability of energy as sources are multiple and therefore from various sources. If we do that and we are careful we’re going to succeed. But there is also another warning that we have been given that, if we want to move from old to new, one of the things we don’t do is to never dismantle the old before you test the new and ensure that it is reliable, resilient and is efficient. So, movement must be systematic, and it should be managed carefully. Thank you.
Mr J R B LORIMER: I would like to find out if the department performs economic impact studies during the licensing process. Was that done in this case? What’s the government’s estimate of possible beneficial consequences of drilling if it does go ahead over KwaZulu-Natal coast. More than that, what is the department’s assessment of the possible risks of drilling?
The ACTING CHAIRPERSON (Ms R M M Lesoma): There are two questions hon Minister. You will use your discretion. Over to you.
The MINISTER OF MINERAL RESOURCES AND ENERGY: Yes, if there
are two questions, I have a discretion to answer whichever. I can just use my discretion. What is important here is that we are dealing with a case that is actually a myth now, because Eni has left the coast of KwaZulu-Natal. That’s one thing we must accept. They ran away from subsequent litigation after litigation and left our shores. So, we are moving with an imaginary case that doesn’t exist at this point in time. But what is more important – yes, it is imaginary. They are not here, they’ve gone. They’ve gone.
But what is important is that if we are careful, we’ll do that assessment and balance the economic benefits to the risks that are there in terms of the environment. I always make this point and some people refuse to accept that. I said, if we make breakthroughs, for example on developing our petroleum sector, the economic growth is going to be different from what we see here. I can assure you we’ll get a gross domestic product, GDP growth 5% to 8% per annum. But it requires us to go through it and be careful not to damage the environment.
Mr N SINGH: Hon Minister, I see you seated next to the Minister of Forestry, Fisheries and the Environment. So, you’re careful about environmental issues there. But sustainable development is development that meets the needs of the present without compromising the ability of future generations to meet their own needs.
Now, I want to put it to your hon Minister that, economic challenges, the lack of fuel, the increased price of fuel or whatever economic challenges can be mitigated by additional resources being ploughed into it. But when there is medium to long-term damage to the environment, our future generations, are going to feel that. What is your view on this, hon Minister? Thank you.
The MINISTER OF MINERAL RESOURCES AND ENERGY: I want to
demystify the assumption first, that development is equal to damaging the environment. It is quite a funny assumption that we normally make. I’ve been emphasising that you balance the two and work for coexistence of economic development and production of the environment. That requires regulations, which we do. One of the things that I can see Minister Barbara today we are sitting next to each other. People think that I
will get a punch from you, or you’ll get a punch from me. It doesn’t happen.
We do discuss issues because we know the importance of protection of the environment. We know the importance of development of the economy because both of them are required for today, and both of them are required for the future. And there will be no future if you kill development and there will be no future if you destroy the environment. You need both, you balance the two. Thank you.
The ACTING CHAIRPERSON (Ms R M M Lesoma): Hon Members, the time allocated for questions has expired. Outstanding replies received will be printed on Hansard. Hon members, order. No, order including Mam’uKhawula. I request members to stand and wait for the Chair and the Mace to leave the room and that concludes the business of the day.
The Business of the day concluded.
The House adjourned at 18:05.
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