Hansard: First Reading: Adjustments Appropriation Bill / Debate on Medium-Term Budget Policy Statement / Consideration of Report of Standing Committee on Finance on Medium-Term Budget Policy Statement

House: National Assembly

Date of Meeting: 10 Nov 2009


No summary available.




Wednesday, 11 November 2009 Take: 624




The House met at 16:12.

The Deputy Speaker took the Chair and requested members to observe

a moment of silence for prayers or meditation.




Ms S P KOPANE: Madam Deputy Speaker, I hereby give notice that on the next sitting day of the House I shall move on behalf of the DA:

That the House –

debates the need for a coherent food security policy as a matter of urgency, considering that scientists predict that 40% to 50% of undernourished people are expected to be living in sub-Saharan Africa by 2080, and the agricultural yields may decrease by as much as 50% by 2020.



Ms H LAMOELA: Madam Deputy Speaker, I hereby give notice that on the next sitting day of the House I shall move:

That the House-

debates the impact of wasteful expenditure in various government departments and the serious impacts it has on service delivery.




(Draft Resolution)

The CHIEF WHIP OF THE MAJORITY PARTY: Deputy Speaker, I move without notice:

That the House–

notes with great appreciation the approval by the United Nations of naming 18July Nelson Mandela International Day;

further notes that Nelson Mandela Day has already been declared an annual community work day for the cultivation of ubuntu values and principles that our icon, Nelson Mandela, worked and lived by;

believes that Mandela's dedication to progressive values of human and social solidarity without regard to race, class and gender will continue to guide us in our efforts to create a nonracial, nonsexist, united, democratic and prosperous society in which the value of all citizens is measured by our common humanity;

recognises that President Mandela's commitment to progressive values is encapsulated in the words of Lord Khem, an African sage, who says "... the Light that is God resides in each and every one of us ... " and further says to us, "Thou art the Light that shine upon others ... ";

further recognising that our icon, Nelson Mandela, has been the light that shines upon others; and

supports and joins President Jacob Zuma in welcoming the recognition by the UN of Nelson Mandela Day and encourages the peoples and nations of the world to recognise the power within themselves to do something to improve the quality of life of others in celebration of Nelson Mandela's International Day.

Agreed to.




(Draft Resolution)

The CHIEF WHIP OF THE OPPOSITION: Madam Deputy Speaker, I move without notice:

That the House–

notes that today, at the 11th hour on the 11th day of the 11th month, marked the 91st anniversary of the signing of the Armistice on the 11November 1918 to signal the end of World War I;

further notes that at 11:00 on 11 November 1918 the guns of the Western Front fell silent after more than four years of continuous warfare;

commemorates not only all those men and women who were killed during the war, but all those who have fallen in the many tragic and often devastating conflicts that have occurred throughout the world since then; and

honours those who sacrificed themselves in these conflicts by wearing artificial poppies in remembrance of their sacrifices.

Agreed to.




(Draft Resolution)

The CHIEF WHIP OF THE MAJORITY PARTY: Deputy Speaker, I move without notice:

That the House–

notes with admiration and excitement the news that President Jacob Zuma has been chosen as Africa's finest leader and has had the prestigious African President of the Year Award 2009 bestowed on him on Tuesday, 10 November 2009, at the African Consciousness Media Leadership Awards ceremony in Johannesburg;

further notes that the award, founded by the African Consciousness Media and the Kenneth Kaunda Foundation, recognises achievement and serves to honour African leaders;

believes that the award is one of the instruments used in our continent to promote good governance and to foster economic integration and development;

further believes that this award will help remind African leaders of their responsibilities to the people, as true leaders are guided by the needs and the collective wisdom of the people, and this award should, therefore, not be about status or prestige, but service and sacrifice; and

congratulates President Zuma for winning the award for his outstanding leadership, humility, dedication and commitment to serve and listen to the people of South Africa and Africa, and his efforts for a better life for all.

Agreed to.




(Draft Resolution)

The CHIEF WHIP OF THE OPPOSITION: Madam Deputy Speaker, I move without notice:

That the House-

notes that on 25 November 2009 the international community will celebrate the International Day for the Elimination of Violence Against Women as adopted at the 54th session of the United Nations General Assembly in December 1999;

further notes that the origin of the date 25 November goes back to 1960, when three Mirabal sisters from the Dominican Republic, also known as the Unforgettable Butterflies, were violently assassinated for their political activism;

recognises that violence against women and girls is a problem of pandemic proportions and that the legal systems and community attitudes add to the trauma violated women and girls go through on a daily basis;

further recognises that this pandemic is not only physical and mental violence against women and children, but includes human and child trafficking and sexual exploitation;

acknowledges that, although every effort is being made to eliminate violence against women and girls, statistics show that more women and children are being violated on a daily basis; and

commits itself to ensure that we will continue our efforts to ensure that violence against women and children is eliminated, and that women and children who have been violated are given the support they require.

Agreed to.




(Draft Resolution)

Mr A M MPONTSHANE: Madam Deputy Speaker, I move without notice:

That the House –

notes that 14 November marks the celebration of World Diabetes Day which is led by the International Diabetes Federation;

further notes that there are currently approximately 6,5 million South Africans living with diabetes;

further notes that diabetes can be managed and people who are well informed about the illness are able to adapt their eating habits to the demands of diabetes; and

calls upon all South Africans to observe World Diabetes Day and play an active role in promoting healthier lifestyles.

Agreed to.




(The Late Comrade Ronnie Press)

The CHIEF WHIP OF THE MAJORITY PARTY: Madam Deputy Speaker, I move without notice:

That the House –

notes with profound sadness the passing away of Comrade Ronnie Press on 28 October 2009, in Bristol, England;

recalls that Comrade Ronnie joined the Congress of Democrats in 1953, played an active role in Cosatu, the ANC, Umkhonto we Sizwe and the SACP, and also served as Secretary of the Textile Workers' Industrial Union;

remembers that comrade Ronnie, alongside Nelson Mandela and others, was amongst comrades charged with high treason in the famous 1956 treason trial and after the trial, went into exile in the United Kingdom where he continued to assist in operations against the apartheid state and was instrumental in the development of the Bristol Anti-Apartheid Movement;

further remembers that Comrade Ronnie was a trained chemical engineer and has contributed immensely to the struggle by providing much needed technical expertise and helped to smuggle equipment and weapons into South Africa and was involved in the movement's technical committee which created a variety of devices that were used in operations against the apartheid state; and

conveys its condolences to the Press family and friends, the ANC, the SACP and Cosatu.

Agreed to.





There was no debate.

The Chief Whip of the Majority Party moved: That the Report be


Motion agreed to.

Report accordingly adopted.




There was no debate.

The Chief Whip of the Majority Party moved: That the Report be


Motion agreed to.

Report accordingly adopted.




Mr T A MUFAMADI: Deputy Speaker, hon members and Ministers present will recall that, on the 27 October 2009, the Minister of Finance complied with section 28 of the Public Finance Management Act, which obligates him and his department to present to the House a multiyear budget projection. The purpose of this projection is to give certainty and predictability to the country's finances and indicate its sustainability, particularly in terms of revenue and expenditure patterns and, most importantly, in terms of the macroeconomic outlook that seeks to locate our country's place and space in the world economy.

The relevant committees responsible for finances in this House were assigned to process the Medium-Term Budget Policy Statement and recommend and report back to this House. On behalf of the Standing Committee on Finance, allow me to say that it an honour for us in the committee to be part of a team from this Parliament, entrusted with the task of overseeing the processes and management of our economy and its finances.

I am therefore pleased and privileged to present the committee's report and recommendations, which I will deal with later in my submissions.

We need to submit, upfront, that the committee had to perform its duties within a very short space of time, given the busy schedule of our parliamentary work. Nonetheless, the committee managed to receive substantive comments and very useful inputs from businesses, organised labour and respectable economists affiliated to reputable institutions.

In processing its work, the committee reflected on the following important topics: the state of the economy; the economic policy outlook; fiscal and monetary policies; spending priorities; and budget deficits.

The 2009 main Budget, like many budgets over the whole world, was formulated under very severe economic conditions and in an environment that could described as being hostile towards the poor and emerging economies, through no fault of their own.

It is not my intention to dwell much on the historical deficiencies of our microeconomic challenges. However, it must be said that the Medium-Term Budget Policy Statement and its recommendations are being debated under slightly improved economic conditions compared to six months ago. There are signs of cautious hope of an economic recovery, which means the country's national framework response to the global crisis is beginning to yield positive results. However, we must warn that it is not yet time to celebrate. The projected economic growth, that would suggest the rollovers of yesteryear, is not yet in sight.

Our work as parliamentarians is clearly defined under these current economic challenges. We are called upon, through our various standing and portfolio committees, to monitor vigorously expenditure patterns in government departments, parastatals and support Operation Clean Audit – the courageous efforts of the Minister of Co-operative Governance and Traditional Affairs to improve service delivery and accountability at local government level.

In terms of our economic recovery, this can only be realised if proper and sound economic policies, with better co-ordination between all spheres of government, are implemented, monitored and evaluated within the context of a coherent and sustainable plan co-ordinated from a central point - in this instance, the Presidency.

We have noted that government has provided support to several key sectors of the economy through development and finance institutions, while simultaneously enabling economic adjustment. Development Finance Institutions, DFIs, have assisted in boosting public sector infrastructure and investments, without which the much celebrated 2010 World Cup activities and 2010 legacy projects would have been impossible.

Before I submit the committee's recommendation it is critical that we explain how we see the steps that South Africa is taking to support its recovery plan through the Medium-Term Budget Policy Statement proposals in the current global crisis.

Firstly, we need to commend the Minister and his team for protecting the key priority areas outlined in the state of the nation address. These are: creation of decent jobs and protection of existing jobs; investment in public and economic infrastructure; education; a sustainable rural development strategy; stepping up the fight against crime and corruption; and prioritising the fight against the HIV/Aids pandemic.

The Medium-Term Budget Policy Statement also indicates a strong intention to maintain expansionary fiscal and monetary policies into the outer years of the Medium-Term Expenditure Framework. One of the key lessons that corporate South Africa and the world over should learn from the current economic crisis is that heedless, selfish, amoral economic interest, particularly in terms of business practices, leads to bad economic outcomes with unintended consequences that affects mostly the poor and the working people.

Financial institutions designed to carry out functions of the bank should do so within the designed regulatory framework. If they desire to deliberately avoid and evade regulations, they wreak havoc on the very same economy and markets that they are supposed to support and sustain.

Secondly the creation of subprime lending to the unbankable in order to support profitability and award huge bonuses to executives in the banking or financial institutions, is not sustainable.

The third lesson that we should learn from this economic crisis is that overvalued corporate assets and stock market shares also lead to distortion of the economy and undermine the same economy that seeks to be promoted and sustained.

The sad part of everything is that all these mistakes hurt the poor and the working people most. As we proceed into the future in terns of our economic recovery, it will be important that we deliberately seek state intervention in the economy to reduce and eliminate inequalities in society and also seek to equalise incomes between the poor and the rich.

As far as our recommendations are concerned, I would like to focus mainly on three or more things that the committee has looked at. In order for Parliament to engage substantially and more intelligently with the budget before it, there is a need to expedite the setting up of a Parliamentary Budget Office in the near future in order to support the work of the Finance and Appropriation Committee, especially during the value-for-money oversight and accountability exercise. It will therefore be ideal for the Director of the Parliamentary Budget Office to be appointed as soon as possible. This should be done no later than March next year. [Applause.]

The committee also believes that it important to provide sufficient administrative content and research support capacity to Parliament in order for it to fulfil its legislative obligations and oversight functions over the work of the executive. It is also critical that Parliamentary programmes allow time for Parliamentary committees to engage with the Medium-Term Policy Statement and Budget matters, otherwise we pay lip service to public participation.

In conclusion, I would like to thank the committee members for their participation and for their dedication in making sure that the committee executes its responsibilities. We therefore recommend that this House consider and accept our proposals as proposed in our report. Thank you. [Time expired.]

Dr D T GEORGE/ End of take


Dr D T GEORGE: Madam Deputy Speaker, the Medium-Term Budget Policy Statement confirms what the average South African household already knows: The job market has declined sharply; disposable income has fallen; indebtedness remains high; and government excess has been exposed.

There is no doubt that the global financial crisis has hit home and has had a far worse impact on our fiscal framework than anticipated only a few months ago. Conditions have deteriorated very quickly. The steady progress made over the past 15 years to develop a robust economy capable of withstanding constantly changing globally integrated markets, has been reversed. The Budget deficit, at 7,6% of Gross Domestic Product, GDP, or R184 billion, will need to be financed by the people.

Government plans to expand its debt from a current 29% of GDP to 41% in 2012-13, mostly sourced on the domestic credit market. This will impact on the availability and price of credit for other participants in the economy. This 12 percentage point increase is a significant expansion in rand terms, given that the GDP is expected to grow from next year. The room left to manoeuvre is getting tighter, especially given that assumptions underlining the fiscal framework may well prove to be optimistic. If our economy does not grow as expected, we are heading for debt servicing expenditure that will slow service delivery down even further.

Given the service delivery protests that have recently erupted, it is clear that the people are growing restless over the absence of delivery that was caused by government's failure and inability to efficiently spend money that is available. Matters will be far worse when money is not available.

Although the tax revenue shortfall amounts to R70,3 billion, a further R10,8 billion shortfall arises from sources in the provinces, social security funds and state-owned enterprises. This reduces government revenue to 27,3% of GDP. Government expenditure, however, increases nearly 5 percentage points from last year, to 35% of GDP. The numbers point to the emergence of a dysfunctional developmental state. The size of government participation in the economy is increasing, but government functionality and service delivery output is not.

The DA supports the counter-cyclical fiscal stance adopted by government. This does mean that government will be spending more at a time when its revenue is shrinking and the result will be a deficit and an increase in borrowing. The crucial issue, however, is that an increase in government spending during a recession should benefit the economy in the longer term and yield maximum post-recession benefits. Increased spending to fund government inefficiency and luxury lifestyles for the government élite is not acceptable and defeats the purpose.

The preliminary report by the Government Task Team to Effect Savings makes bold and welcome statements. We also welcome the Minister's firm commitment to not tolerate corruption; act forcibly against wastage; insist on value for money; and act against those who feed selfishly of the state.

Increases in government spending do not demonstrate this commitment. The R589 million set aside for new government departments and the appointment of additional Ministers and Deputy Ministers appears to be little more than a political exercise to appease the various factions within the government alliance with the perks and privileges of executive office. Ten thousand RDP houses could have been built instead. That would have represented a real and tangible impact on the lives of ordinary South Africans.

The R1 billion recapitalisation of the Land Bank would not be necessary if government had taken steps to prevent deployed cadres from infecting the institution with a culture of kleptocracy that is extremely difficult to eradicate, given that it is widely spread across the state-owned enterprises. These entities are funded with taxpayers' money intended to improve the lives of the poor. We expect the Minister to do as he says he will do and ensure that the parasites who steal the people's money are identified and prosecuted.

The R12 billion increase in the state payroll – not provided for in the main Budget – demonstrates that government does not manage its human capital effectively. There are too many public servants in unproductive jobs within a bloated bureaucracy, and too few in critical service delivery areas. The state payroll is steadily increasing, without tangible benefits to taxpayers and service recipients. This is not value for money.

Not long ago in a place not far away, a government forgot that it exists to serve its people. It adopted unworkable policies that brought a once-thriving economy to collapse; it violated property rights; it ignored its Constitution; it spent more than it received; it used the people's money to fund luxury lifestyles for some; it printed money to fund its debts and rendered it currency worthless. And now, Zimbabwe awaits financial rescue. We must prevent this from happening to us.

Now that Minister Manuel has vacated his position as Minister of Finance, the public will no longer have an opportunity to offer their "Tips for Trevor" in the lead up to the annual Budget. It therefore seems likely that this would be replaced by "pointers" for the present Minister. The DA would like to offer the first one to the Minister: The social contract between government and taxpayers is already strained because taxpayers must fund inefficient government spending and luxury lifestyles for some while they struggle daily to put food in their children's stomachs and a roof over their heads. Tax increases will not be necessary if government spends the people's money wisely. Thank you. [Applause.]

Mr N J J Van R KOORNHOF/ End of take


Mr N J J Van R KOORNHOF: Madam Deputy Speaker, we are all aware that this policy statement by the hon Minister of Finance was made against the backdrop of a very uncertain economic time, compounded by a behind-the-scenes ideological debate regarding the direction of economic policy.

The hon Minister has passed this hurdle looking like the boss we expect a Finance Minister to be. His consistent approach, in not diverting from previous policies, has won him Cope's support.

It was 20 years ago that the world was reborn when the Berlin Wall collapsed and the face of the world changed forever. The current debate, fuelled by Cosatu and the SACP on who should be the boss on economic policy, is ironic. Cosatu must realise that the real opposition in South Africa's economy is not us or them, but the financial markets.

Cosatu must be wary not to overplay their hand with the new government and need to pick their battles with government with greater care. Battles should never be personal. Cosatu and the SACP should stop this debate now, support the Treasury under the guidance of the hon Minister and get on with the job to address our serious economic challenges. We do have serious challenges.

Firstly, South Africa will have a hesitant economic recovery. We are going to lag behind the world's economic recovery and some downward risks remain in our economy. Therefore, our growth forecast should be conservative.

Secondly, the uncertain effect of rising energy prices over the next 12 months affects inflation forecasts and creates uncertainty. Until we have sorted out Eskom's capital requirements, the market will remain volatile.

Thirdly, the question remains as to whether our fiscal stimulus package is correct and not too late. So far, this government has relied extensively on public spending increases and not on any tax cuts. This program is too silent on private sector involvement.

A large portion of this expenditure increase is the growing salary bill, approaching like a swarm of locust throwing a dark cloud over our economy. Government has acknowledged that the increase in salary Bill is not sustainable. Let's now see action to curb it.

Economists have warned that our fiscal deficit increase is one of the highest. It is comparable to that of the United States. Because of that, our public debt will increase dramatically, shifting the burden of this debt to future generations.

Cope would like to see a clear plan, even if it needs to take a longer view, to ensure that we shall be out of this debt. Only a conservative and consistent approach by government to cut the salary Bill and to grow the economy will spare our future generation's hardships.

Failure to improve efficiency in government spending will delay our recovery and prolong further borrowing.

We need specific investments. We need to speed up access to the internet. Government does not have the fiscal space to create jobs alone. We need the private sector. We need low inflation targets, high productivity and competitiveness. We need to ensure that the small and medium-sized enterprises, SMEs, become the main engine of job growth by getting the banks to fund them, cut the read tape and make the internet more affordable. It is vital that we focus on expenditure programmes that will improve competitiveness.

It will be the hon Minister's duty to control our soaring debts so as to avoid serious discomfort for our economy. We wish him all the best and Cope will support him in these efforts. [Applause.]



Mr M G ORIANI-AMBROSINI: Madam Deputy Speaker, the IFP would today like to present two dissenting views on the Medium-Term Budget Policy Statement, MTBPS.

First, the IFP cannot associate itself with the Medium-Term Budget Policy Statement's total reliance on the economy turning around this fourth quarter and thereafter maintaining a high rate of sustained economic growth for the next three years.

This too optimistic a scenario is pegged on selected positive signs, on the uncorroborated belief in a sudden increase in consumer spending and on the assumption that the South African economy will be raised by the raising of the US economy.

It underplays signs which suggest that the depression will continue next year, such as the projected decline in construction and the recessionary effect of the completion of the 2010 Fifa World Cup infrastructural and commercial preparation.

It is risky to boost consumer confidence with the untested promise that the hard days are over, rather than with real interest rate cuts and measures countering the credit crunch. Instead of trying to serve the national interest by expecting the best while preparing for the worst, the MTBPS is ignoring the worst while relying on the best.

Secondly, realising, as one should, that even though the global depression started as a financial crisis, it has now become an industrial crisis, the IFP criticises the Medium-Term Budget Policy Statement's failure to make the required structural adjustments to create a new and globally competitive industrial basis and to cut on chronic government-created industrial problems.

The depression should have given the impetus to abolish the entire system of exchange controls – which serves no purpose at this country's stage of development; to introduce the flexibility of the labour market which government has been talking about since 1998; and to reform the underperforming parastatal sectors.

The MTBPS speaks of necessary relief for our economy, such as the devaluation of the Rand and cuts in interest rates, but none have yet been effected in any relevant manner, as if there were time for it. The MTBPS should bring tax reliefs and a new package of long-term incentives for the creation of new viable economic sectors, such as assistance in Research and Development, but it contains none of them specifically. Thank you.

Mr L W GREYLING / End of take


Mr L W GREYLING: Speaker, in an interview shortly after the hon Minister delivered his speech, I was told by one journalist that the worst nightmare for opposition parties would be if the Budget signalled a shift to the left. He then asked me if my worst nightmare had come true.

I immediately thought about the fact that, with a projected deficit of 7,6%, by any account, this is indeed a left budget statement. It sends a very strong signal that social spending will not be cut during this recessionary period. It makes financial provision for the extension of the Child Support Grant to all children under the age of 18 and provides an extra R900 million for antiretroviral treatment for HIV patients.

In addition, it gives our cash-strapped local government sphere an extra R12,6 billion and ensures that our infrastructure built programme will act as an economic stimulus during this recessionary period.

If this is supposed to be my worst nightmare – I thought to myself – then I would like to state for the record that I believe there is a very fine line between nightmares and dreams.

The fact is that the terms "left" and "right" do not apply in their traditional sense anymore. Proof of this lies in the fact that, on that same day, I heard the economist Brian Kantor – not a leftist by any means – state that he was against rigid inflation targeting, the supposed holy cow of the right.

It is clear therefore that we need an economic policy that does not preserve the status quo of half our people living in poverty, 40% unemployment and rising inequalities.

The ID supports the Budget policy statement and the Minister's commitment to reign in wasteful expenditure while expanding provisions to the poor. Perhaps now the hon Minister can start the difficult task of getting the message across to his Cabinet colleagues that it is not the car that maketh the Minister, but their solidarity with the poor. I thank you.

Mr S Z NTAPANE / End of take


Mr S Z NTAPANE: Deputy Speaker, hon members, the UDM is concerned about the effects of the recession on the average South African. People are struggling to make ends meet. Therefore we condemn wasteful and extravagant expenditure by government.

The economic situation is dire, as reflected by the billions of Rand in tax shortfall, which proves that government simply cannot afford to waste precious funding. The UDM is concerned about the growing Budget deficit. It is not healthy to incur such a long-term debt, which future generations will inevitably inherit.

The UDM is also concerned that the Minister will face an uphill battle against the left wing of the ruling alliance, which seems to be launching an all out attack on the idea of a free market. Now more than ever the UDM believes that a responsible and caring government should also be a government that allows the entrepreneurial drive of the man in the street to flourish. Now is the time to encourage people to create new wealth and prosperity.

The UDM support this Medium-Term Budget Policy Statement. I thank you.

Adv D A ALBERTS / End of take



Adv D A ALBERTS: Adjunkspeaker, Minister Pravin Gordhan se Mediumtermyn Begroting getuig van 'n ewewigtige benadering tot ekonomiese beleid en daarmee kan die VF Plus hom geluk wens. Daar flikker egter 'n paar gevaartekens op die horison.

Indien die Minister wil hê dat die belastingbetaler waarde vir sy geld moet kry – soos hy onderneem – moet hy nie net korrupsie bekamp nie, maar die onsinnige besteding op irrelevante items soos oorsese reise in alle staatsdepartemente, vasvat.

'n Verdere voorbeeld: Om R200 miljoen vir die SAUK te gee as gevolg van wanbestuur, is nie waarde vir geld nie.

Daar sal ook indringend gekyk moet word na die sfeer van plaaslike regering, waar stadsrade miloene rande spandeer op luukse partytjies en konferensies terwyl gewone mense nie kos het om te eet nie.

Daarom is dit net billik dat, as daar verwag word van die belastingbetaler om sy gordel in te trek, die staatsdepartemente dit ook sal doen.

Verder sal die Minister ook indringend daarna moet kyk om die belastingbasis uit te brei, aangesien 7 miljoen mense nie aanhoudend kan betaal vir 50 miljoen mense nie.

Die Mininster se vooruitskatting van 'n groeikoers van 3,2% oor drie jaar is 'n realistiese benadering. Wat wel kommerwekkend is, is dat die leningsbedrag oor drie jaar vanaf 23% van die bruto binnelandse produk, BBP, na 41% sal groei. Geld wat geleen word moet terugbetaal word met rente, en dit sal die belastingbetaler wees wat daarvoor moet opdok. Soos dit is, kan die belastingbetaler nie die huidige belastinglas hanteer nie, en dit is sonder die beplande Eskom verhogings. Daarom sal die regering baie meer kreatief moet wees ten opsigte van die aangaan en terugbetaling van skuld. Indien die belastingbetaler, insluitend besighede, verder swaar belas word, sal die skepping van 4,5 miljoen werksgeleenthede oor die volgende vyf jaar bloot 'n hersenskim kan bly. Ons hoop dit is nie die geval nie. Ons bid jou wysheid toe, Minister Gordhan. Dankie.

Ms Z S DUBAZANA / End of take


Ms Z S DUBAZANA: Deputy Speaker, the executives and hon members, "Sanibonani." [Good afternoon.] Internationally, there is a growing consensus that good governance can promote pro-poor distributive outcomes and also reduce corruption. Budgets are particularly powerful instruments in socioeconomic transformation, redirecting public resources to benefit the poor and other vulnerable groups, particularly in the provision of public services.

The 52nd ANC conference in Polokwane made it clear that the bulk infrastructure tender processes did not take care of the emerging contractors. It also indicated the dying need for the centre for planning. The latter has been achieved, much as the DA does not see the need that R500 million must be spent on the new divisions.

In the apartheid era, budgeting and budget processes were characterised by secrecy and lack of transparency, with negligible participation by Parliament or civil society. Thank you to the ANC who brought back our dignity and respect. This is indicated by the innovations included, the introduction of the Medium-Term Expenditure Framework, MTEF, and also the establishment of the Minister's Committee on Budgets so as to enhance political oversight and the allocation of resources.

The committees on finance had an opportunity to listen to different public hearings on the Medium-Term Budget Policy Statement, MTBPS. Some presentations were quite informative while others were neither here nor there.

Let me share one of the perceptions that were raised by one of the presenters. This presenter said, "the patient is in the operation theatre, and the operation went well, but the patient died."

The ANC is aware that the country is experiencing an economic downturn, but that doesn't mean that the patient is going to die, rather, the patient is in the recovery room. This means that we are recovering, but recuperation will depend on the commitment and the determination from all of us in this Chamber.

The ANC believes that an individual contribution will contribute towards the survival of the whole, which are our communities. The ANC's programme document called The Freedom Charter indicated very well that poverty and inequality must be eradicated. Indeed, the ANC-led government, within the 15 years, has tried to combat the problem, but there is still a lot to be done.

Let me share some achievements. The Expanded Public Works Programme, EPWP, is targeted at creating 1 million job opportunities in 5 years, to be implemented across the 4 sectors. If you listen and compare the network opportunities created in the financial year 2008/9, the total is 568 224, and the cumulative total comes to, within the 5 years, 1,6 million. Indeed, the ANC does not make a wish list when it sets up its programmes or its objectives.

The ANC also promised during its 52nd conference in Polokwane that it would halve poverty between 2004 and 2014. The real annual mean per capita analysis shows an improvement in the incomes of the poorest, rising from R783 to R1 141 in 2008.

The ANC has also acknowledged that the gap between the rich and the poor is increasingly growing. This is a sign that the deep structural nature of poverty and inequality in South Africa has a racial underpinning. It seems also that the lowest rate of improvement that I'm talking about is in the middle-income range.

The ANC-led government has provided appropriate social assistance support to all eligible beneficiaries. As of March 2009, just over 13 million people received social grants, which takes about 5,5% of our Gross Domestic Product, GDP. The ANC supports this, much as the members on my left hand side strongly believe that the ANC shall create a social welfare state.

In 2007, a community survey estimated that people with disability constitute 4% of South Africa's population, and while opportunities have increased, there are still insufficient services and opportunities for people with disabilities to participate equally in economic transformation or development. The Constitution envisages a role for the legislature both in influencing the Budget and exercising oversight to ensure the effectiveness and the efficiency of the economy service delivery.

The ANC supports the Medium-Term Policy Statement. God bless you. [Time expired.] [Applause.]

Ms C DUDLEY / End of take


Ms C DUDLEY: Deputy Speaker, the ACDP broadly supports the three-year plan which has had to factor in a massive shortfall in tax revenues. We agree that, while borrowing now does seem to be the right thing to do, it is unsustainable in the long run.

We recognise, however, that fiscal expansion and, in particular, the infrastructure spending has contributed to long-term capacity and short-term job creation. We welcome the additional R70 billion over 3 years to improve education, health services, the fight against crime, job creation, social services, infrastructure, etc.

Reducing unemployment and addressing poverty must remain our single biggest priority. The ACDP shares the Minister's concerns that the output and outcomes are lagging the massive investments we are making. We support government's commitment to reducing wastage and achieving greater savings in departments.

The ACDP will support the Medium-Term Budget Policy Statement which is presented against the backdrop of shrinking economic growth, a ballooning Budget deficit, and a mounting pressure on the new government. Thank you. [Applause.]

Ms M N MATLADI / End of take


Ms M N MATLADI: Deputy Speaker, it is ironic that, according to the speech of the Minister of Finance on the Medium-Term Budget Policy Statement, 500 000 people have lost jobs while on 3 June 2009, the President promised that, "between now and December 2009, we plan to create about 500 000 job opportunities." Instead people are left with economic devastation and the human tragedy of job losses.

The Medium-Term Budget Policy Statement for 2009 spells out several issues of concern; the decline of income tax at R21 billion, VAT at R31 billion, and Customs and Excise Duties at R9 billion lower than estimated in February. This leads to the country's borrowing requirement of R285 billion against the R89 billion of the previous financial year.

The procurement system has to be reformed to avoid fraudulent activities in the departments, including R615 million of employees doing business with departments. The government is losing billions of Rand on consultants who are not hired temporarily for specific expertise, but are hired to perform duties of the employed officials – which is a double expenditure.

Finally, is a concern of exorbitant salaries of municipal managers, their expensive vehicles and their highly-paid bodyguards. These have to be monitored during these hard times. I thank you. [Time expired.]

Mr R B BHOOLA/ End of take


Mr R B BHOOLA: Deputy Speaker, the MF strongly believes that the deficit will have tremendous altercations and a negative impact on service delivery. The austerity measures such as saving schemes and reprioritisation of departmental programmes, non-core versus core functions, as a way and means of instilling financial management and discipline are welcome.

The MF feels that the austerity measures are not adequately addressed to all the areas of government, including the executive, like going to insignificant international trips, etc. However, the MF believes that this is a good initiative, but it should start from the executive level where more funds are spent.

KwaZulu-Natal is going for an overdraft of R4 billion as a result of poor financial planning. This is a detriment to the money that is budgeted for service delivery. This means that less money is spent on service delivery and more on the executive, whereas, in actual fact, this is suppose to be the other way around. This will assist government if it is serious about transforming the economy and restructuring the public service and economic recovery. The MF will support the statement.

Mr E M SOGONI / End of take

End of take


Mr E M SOGONI: Deputy Speaker and hon members of Parliament, the world has experienced the worst financial and economic contraction, some would say since 1930, others say 1992 or 1993. Although the medium-term growth is low, South Africa's good economic choices over the past decade have allowed it room for the bold response that was presented in the Medium-Term Budget Policy Statement, MTBPS, by the hon Minister of Finance, hon Pravin Gordon.

The Minister has tabled a series of policy measures that should contribute towards pushing back the frontiers of poverty. The Minister of Finance, in his foreword on the MTBPS, quoted the constitutional vision that enjoins us:

... to improve the quality of life of all citizens and free the potential of each person as we build a nation based on democratic values, social justice and human rights.

This is in line with the ANC's vision of creating a better life for all, understanding the challenges of confronting decades of subjugation, unemployment and the widening gap of inequalities between the rich and the poor. The Gini coefficient has now moved beyond 0,5 signalling the worsening inequalities.

In the past few months, an estimated 500 000 jobs have been lost, adding to the already high unemployment rate. This only serves to increase the challenges that face South Africa as a developmental state. That is why the ANC at the 52nd National Conference resolved to capacitate and build a developmental state that today has set bold policy measures to enable South Africa to respond to the changed economic environment and construct a more robust platform for growth as the world economy recovers.

In fact, the International Monetary Fund, IMF, believes that the world economy is beginning to turn the corner. This MTBPS enjoins the government to ensure that limited resources are utilised to produce maximum outputs without compromising the quality of services delivered.

An additional Budget of R78 billion over the Medium-Term Expenditure Framework, MTEF, is certainly most welcome. As the ANC, we congratulate the Minister for not revising down the Budget estimates, but boldly keeping them intact and ensuring that the priorities of the government are advanced to ensure that rural development, amongst others, is firmly placed on the agenda of service delivery.

The challenge facing the ones robbed of their land is the absence of budget for land restitution and creation of new farmers. Obviously, rural development cannot be relegated to one department as all departments have a role to play, including the Department of Economic Development, so that those who want to remain in the rural areas are allowed to do so. Many beneficiaries of land restitution have to wait for years before they can be compensated because of lack of budget. This is unacceptable.

We invited the Human Science Research Council, HSRC, who shared their warm appreciation for the vision and MTBPS, although they raised certain reservations. One of the reservations, amongst others, is funding for health.

The ANC acknowledges the MTBPS for taking into account the importance of local governments by ensuring that the Municipal Infrastructure Grant, MIG, grows over the MTEF period. It may not be enough, but it will go a long way in ensuring that, one day, there will not be much difference in infrastructure development between rural and urban areas.

The commitment of this government in creating sustainable and descent jobs is very clear in the MTBPS if you look at the budgetary commitment for infrastructure.

The strategy and tactics document states:

The central task in the current period is the eradication of the socioeconomic legacy of apartheid; and this will remain so for many years to come. However, the establishment of a government based on the will of the people, progress in the transformation of the state, the codification of rights and implementation of progressive socioeconomic programmes represent a major change in the sociopolitical environment.

I would like to take this opportunity to thank members of the Standing Committee on Appropriation across political parties and staff for their support in ensuring that the MTBPS report was produced timeously and adopted unanimously by the committee members.

I also thank my secretary for going the extra mile to ensure that everything ran smoothly. The ANC support the MTBPS. I thank you. [Applause.]

Mr P J RABIE / End of take


Mr P J RABIE: Madam Deputy Speaker, hon Ministers and hon Members of Parliament, South Africa, like a number of other emerging economies, finds itself in a recession. Our tax revenue declined form R740,4 billion to R657,5 billion, while expenditure decreased from R843,3 billion to R841 billion. Budget deficit increased from an estimated 3,8% to 7,6% of Gross Domestic Product, GDP.

The DA agrees with the hon Minister of Finance that the increase in the Public Sector Wage Bill, which is higher than the official inflation rate, may lead to higher inflation pressure. Another inhibiting factor is the possible escalation in the price of electricity of 45%, which will adversely affect the entire economy. In a nutshell, further job losses are inevitable.

We compete in a global market where a competitive advantage of manufactured goods is influenced by the cost of energy. For instance, it's estimated that the cost of producing one ounce of gold will increase by 30% if the price of electricity increases by 45% in three years. At the current gold price production it will no longer be viable, leading to mine closures and job losses.

The greatest threat to the present South African economy, however, is unemployment. Estimates of job losses vary from 20% to 40%. Chronic unemployment has become a fact of life to millions of South Africans. It was estimated that in June 2004, 4,1 million workers were without jobs. What we need is an economic policy that makes South Africa independent from, and not dependent upon social grants.

More than ever before, we need a broad, holistic and strategic economic policy and leadership, and not irresponsible populist verbal attacks on our current fiscal and monetary policies. It appears that the Congress of South African Trade Unions, Cosatu, and the African National Congress Youth League, ANCYL, are determined to question the credibility of a senior member of Cabinet whose portfolio relates to planning, rather than to provide solutions to alleviate poverty, improve service delivery, curb the breakdown in law and order, and retain the independence of the judiciary - key components for sustained future economic growth.

The DA is in a position to provide a viable alternative economic policy. We acknowledge that apartheid was wrong. It used race to discriminate, embitter and drive millions of South Africans apart. Let us not repeat the mistakes of the past. Let us create an open society with equal opportunities where choice and merit are used, and not race quotas and cronyism, to provide an economic environment with positive growth and employment.

Incessant government intervention inhibits economic growth. The core function of the government is to co-ordinate and regulate. We need an effective and efficient public sector, free of corruption, which endeavours to develop our human capital, not to enrich a small close nit élite with political ties to the ruling party. I thank you. [Applause.]

Mr D D VAN ROOYEN / End of take


Mr D D VAN ROOYEN: Hon Deputy Speaker, Ministers and Deputy Ministers, fellow colleagues, central to our developmental agenda as the ANC, the leading party in government, is the mammoth task of ensuring that all South Africans are provided with an opportunity to pursue economic growth, development and redistribution so as to realise a better life for all.

Our government's fiscal policy is the axis around which this developmental mandate orbits. It enables us to deliver on this mandate by providing resources in a manner that is sustainable and that complements the much-needed stability of the economy. As the ruling party, our beloved organisation the ANC has since coming into power strived for the realisation of a strategic perspective of contributing to a stable economy, which we understand to be crucial for creating an environment in which job creation can accelerate, entrepreneurial activities can flourish, and companies and households can invest with confidence.

The current global economic contraction has placed all governments' revenues under severe pressure at a time when economies require fiscal support the most, and at a time when liquidity is very scarce. As a result of our sound countercyclical fiscal policy unlike many other countries in the world where budget deficits have increased, our healthy public finances enabled us to support growth and spending on infrastructure and social services.

In fact, our fiscal response to the economic recession is regarded as one of the largest in the world. The fact that our fiscal and monetary policy cushioned the impact of the budget deficit, which we are all aware moved from 1% of our GDP in the 2008-09 financial year to a projected deficit of 7,6% this financial year, is a much-welcomed reaction and confirms the correctness of the fiscal path we have opted for as the ruling party. We regard this development as a positive step forward towards the realisation of our massive programme to build economic and social infrastructure.

As the ANC we concur that the current expenditure trend will widen government borrowing requirements in order for the government to continue with its noble agenda of bettering the lives of our people. The fact that we entered the economic downturn with a budget surplus is a big plus for us as it creates space for us to continue with our long-term investment plans without having to worry too much about the recession's impact on such plans. It is in the same context that, as the ANC, we support the projected consolidated borrowing requirement of R285 billion.

The ability of government to finance its expenditure programme in a sustainable way is a very central principle of any fiscal policy. A key indicator of sustainability are debt-service costs. Hon Speaker and respectable House, if these costs are left to rise as a percentage of GDP over the long term, we will find it difficult to stick to our expenditure programme. To avoid the possibility of such an occurrence, we urge the Ministry to ensure that related spending is driven by real physical investment projects that will assist us to create jobs that will lead to growth in household expenditure, that will lead to injections to the tax revenue and that will make a positive contribution to the much-deserved economic growth.

It is our belief that such an approach will enable us to treat borrowing as a temporary solution that cannot be allowed to burden generations and inhibit future growth and service delivery. We agree that sustaining higher borrowing will lead to our having spiralling debt costs and eventually to a costly adjustment through lower spending on service delivery or, the most unfortunate situation, to increasing tax rates. This might have a very serious adverse effect on economic stability and growth.

Central to our attempt to curb a budget deficit will be the oversight capacity of both the National Assembly and the National Council of Provinces. As cited in the report of the Standing Committee on Finance, it is our submission as the ANC that, inter alia, the proposed measures be adhered to. The intended expansion of public sector capital expenditure is seen as a good enabler for economic productivity capacity, which will empower the state to continue providing required services and goods.

The expansion in public infrastructure expenditure is also welcomed as an initiative that will enhance the government agenda of economic growth and transformation of the economy in order to create decent work and sustainable livelihoods. We are convinced as the ANC that the newly introduced Ministries of the National Planning Commission and of Performance Monitoring and Evaluation will assist us in dealing with the problem of integrated implementation of all earmarked infrastructure programmes.

Indeed, our economic and social development is about our collective commitment as government, the private sector and civil society to realising the cited priorities of our government. It will be of the utmost importance to work together. Working together we can do. "Eendrag maak mag." [There is strength in unity.]

Hence, it is necessary for all of us to pay tax. Tax revenue has emerged as the key contributor to national income. Therefore it is extremely important for all taxpaying South Africans and companies to prioritise the payment of tax. In order to cater for current development needs and narrowing the worrisome budget deficit we really need to double our efforts and do things differently to boost tax revenue. We therefore welcome the tireless efforts in the form of penalties that are to be introduced by our hard-working Sars team. As commanded by the holy book, let's make sure that we owe no man anything and continue to shower the downtrodden with our love by abiding by the law by paying tax.

Taking our cue from the high-growth strategy studies conducted on 13 economies, we must use the five established growth reasons to further harness the economic moment we are currently in. These are: shifting resources to labour-intensive sectors; having fiscal and monetary policies that promote balanced, sustainable growth; increasing competitiveness, raising productivity, lowering costs; having trade and industrial policies that lower costs and create jobs; and improving public-sector performance and service delivery.

As the ANC we support the Medium-Term Budget Policy Statement, the MTBPS, and remain convinced that it is a budgetary and fiscal declaration of intent that has the full potential of ensuring that collectively we deliver on our mandate as assigned by the South African majority. Indeed, this MTBPS is an appropriate foundation for an economically sound medium-term expenditure framework. Kea leboga, Mmusa-kgotla. [Thank you, Deputy Speaker.] [Applause.]



The MINISTER OF FINANCE: Deputy Speaker, hon members, allow me firstly to thank all of the speakers for their very valuable contributions and for their support of the Medium-Term Budget Policy Statement, MTBPS. I must say, we could have saved a lot of time if they had only said "we support", but I understand that this is a debating chamber, and so we have to debate!

Allow me also to thank the heads of the various committees: Mr Mufamadi, Mr Sogoni and Mr De Beer from the NCOP for their contribution towards implementing the new role that Parliament has and for their thoughtful approach to what we have before us.

Today is actually the day on which we – this executive that sits on my right – have been in office for six months. You can see that, in a very short six months, we have had a crisis, we have had a response to that crisis, and we have had some very insightful contributions from the ruling party and others on how best to manage that crisis so that South Africans, whether they be rich or poor, can actually cope with it much better.

In essence, I think what we would like to say to South Africa today as we debate the MTBPS, is that we reiterate the fact that we will deliver on our priorities as government. These priorities are: better health care; better education; more work opportunities – notwithstanding the current loss of jobs; our focus on rural development; and our determination to eliminate the crime and corruption that so bedevils South Africa.

We are saying that we will spend the R78 billion allocated over the next three years in a prudent way and take into account all of the many factors that have been raised by all the parties that have spoken here today.

We are also assuring South Africans and this House that the prudence, which has marked our previous management of finances, will continue to characterise the way in which we approach our responsibilities. We want to assure you that South Africa's fiscus is in good hands – that being the hands of Cabinet as a whole – and that we are very mindful of the tough situation we find ourselves in, and of the responsibilities that we carry.

Notwithstanding the difficulties that we have, we are also mindful of the fact that we have to take South Africa back on to a growth path. As the MTBPS said itself, President Zuma is quite determined that we don't just go back to the old norm, but that all of us, as South Africans, contribute to finding a new way of growing our economy to create many more jobs for many generations of South Africans who have been excluded from this possibility.

We are also committed – and we welcome the commitment of all of the parties in Parliament – to stopping waste and corruption, getting value for money, and to ensuring that the 1,5 million civil servants that work in government will join us in this particular campaign.

Above all, I think we need to send a message to South Africa that we will look after people who have lost their jobs and help them either retrain or benefit from the UIF or from other measures that are available from the state.

We also want to send a message to the poor that their social grants will not be cut as far as we can help it, certainly not for the foreseeable future, and in fact we want to protect their income so that they can continue to have the benefit of state support.

We also want to send a message to our small, medium and large businesses and the entrepreneurs who manage them, that they need to become a lot more innovative and bold – notwithstanding the climate we find ourselves in – and create jobs which will ensure that South Africans can have the dignity of a job, rather than just being dependent on welfare.

Let me also then give you some context. There was a G20 meeting over the weekend in St Andrews. Those of you who are golfers will know that St Andrews is supposed to be the home of golf. All I could do was stand at a distance and watch the golf course. I am sure that there are people in this Chamber who would have enjoyed being on the green grass.

Arising from that G20 meeting, a set of messages begin to emerge. The first is that the stimulus has certainly helped the world to cope with this recession better that what it would have. Our own efforts at a stimulus package – if you want to call it that – have helped South Africa as well.

The second message is that there is a recovery on the way, but it is a very cautious recovery. All of the graphs around the world are ticking upwards. But that ticking is a very gradual one; it's a very small one and no one can say for certain that it will amount to the "V" that everybody would like to see.

The third message is that there is agreement that the exit strategy that we all speak of and that some are beginning to venture towards, is not at our doorstep just yet. There needs to be continuous co-ordination within the G20 and around the G20 to ensure that we don't have the "W" that Mr Rubini and others spoke of.

It is of particular concern for us in South Africa and other developing countries if developed countries randomly exit from their stimulus strategies, as that could actually have a devastating effect on developing countries.

The fourth message is that there is a discussion going on now in the G20 and in other quarters which says that we need a new growth path, not just for South Africa but, indeed, for the world as a whole. There needs to be greater inclusivity, more balance in a multiple sense and the necessity to look for new what I call sources of growth.

We also talked about climate financing, but only to decide not to talk about it too much. There is still a huge debate going on about who bears responsibility for the climate challenges that we face, who should support the developing countries and how, in respect of both adaptation financing and mitigation financing, this support should be rendered.

Finally, there was a lot of discussion around regulation of the global financial system, around bonuses and some of the issues that hon members have actually raised here.

More specifically, I think we need to agree with members that we need to be cautious; we need to stabilise our economy; we need to ensure that we lay a new basis for the way in which South Africa grows. But laying that new basis is not going to come from one side of the House or from one social partner; it has to come from all of us, and that is what I hope this House will begin to focus its mind on and ensure that we get the debate that we require.

The new growth path that we speak of provides an opportunity for all sides of the House to co-create this new growth path. We have several parties who have said "we have ideas". Well, let us try to create a forum where those ideas can be shared and let us tap into the creativity of all South Africans so that all of us can actually benefit.

We all agree with Mr Koornhof and others that our economy needs to be more competitive and that our small and medium-sized enterprises, SMEs, need to be supported more. We also agree with Mr Oriani-Ambrosini that we actually need a balance between spending, saving and debt management at the household. But there is no one answer to all of these things. There is a new balance that is required. There are times when we need to spend more and there are times when we need to save more. As the Christmas season comes up, that's the balance that we actually require.

We agree with Mr Rabie that the 45% electricity tariff increase is not the ideal for South Africa. The assurance that we, as Treasury and other departments, can give is that there is a collective in government that is working very hard under Ministers Hogan and Peters to ensure that we minimise the impact and tariff increase itself. We can also assure you that that work will actually carry on.

Let me assure you that the deficit is going to be managed. Debt is going to be managed very carefully. While we are also concerned about imposing upon future generations, these are, unfortunately, necessary things that we have to do to make sure that government can meet its commitments and the expectations of our people as well.

I want to agree with those colleagues who talked about service delivery and the need for improvement. The ruling party does not tolerate nepotism. It will not tolerate cronyism and wants to fight corruption as eagerly as anybody else.

I think what we need to focus on is not who is better than the other, but rather on generating a collective commitment in this House, signed by all 400 members, in which we undertake to do everything each of us can do – regardless of the political party – to create a new culture in this country. That's what we need. Not competition about who has the better idea. [Applause.]

So, let me throw out an offer to all of us: let us find a way – and perhaps the whips of the parties need to meet to discuss this – to create the basis for a collective agreement on how we could fight corruption in this country in all its manifestations. Remember – and I repeat this – it is not just public servants who are corrupt; corruption comes from all forms and sides of our economy. It requires a total cultural change in terms of the way we approach business in South Africa and particularly, business with government.

So, let me invite all political parties to join us in this campaign. [Applause.]

We also don't want a bloated bureaucracy that does not deliver and that is low in its productivity. Let us also, together with Minister Baloyi, share ideas about how we move from where we are. We want more people to be employed in the frontline of service delivery, as teachers, as nurses, as doctors and as other people delivering services rather than sitting behind desks. I'm sure he is going to come back to Parliament and give us more feedback in terms of what we are going to do concretely.

Finally, I want to agree that we urgently need to help Parliament set up the Parliamentary Budget Office. The budget allocations have been made to Parliament to enable this to happen. We would like play whatever supportive role we can play, because this is the only way in which Parliament can hold not only the executive, but also various departments, to account and understand what is involved in budgets and ask people the right kinds of questions.

Oversight by Parliament takes another step through this current process with the Money Bills Amendment legislation allowing Parliament, through the appropriation committee – as we will discuss in a moment – to look into whether and what kind of role Parliament can play in amending budget allocations.

So, Parliament has an important responsibility. We welcome that responsibility and, over the next few years, we hope to work with you to ensure that there is greater accountability.

Once again, my thanks to all of the people who have contributed to the MTBPS and the debate on it. Thank you very much. [Applause.]

Debate concluded.




(First Reading debate)

The DEPUTY SPEAKER: I would like to raise a point, hon members, while hon Sogoni is making his way here. The level of noise is unbearable. Please, I am not saying that you shouldn't talk, but we must be able to hear the speaker.

Mr E M SOGONI: Deputy Speaker, colleagues, again the tabling of the Adjustments Appropriation Bill affords Parliament and the people of South Africa the opportunity to reflect and build on the progress that has been made to change the lives of ordinary people, specifically the poorest of the poor. The Bill is tabled in the context of a devastating recession that led to a declining budget, when a number of firms had to close shop and thousands of workers lost their jobs.

The economic situation has resulted in the slowing down of economic growth and obviously reduced fiscal space. However, we get solace from the fact that the ANC-led government voluntarily maintained sound financial management and prudent fiscal financial choices that should caution us against the worst effects of the recession.

The national Adjustment Budget is tabled in line with section 12 of the Money Bills Amendment Procedure and Related Matters Act, Act 9 of 2009 and section 13 of the Public Finance Management Act, Act 1 of 1999. The Money Bills Amendment Procedure and Related Matters Act enjoins the Minister to present the Medium-Term Budget Policy Statement, MTBPS, and the Adjustment Appropriation Bill to a joint sitting the finance committees of Parliament, which was done. I will not go into the rest of the procedures of the Act. It is safe to say that the committees held hearings with a few departments.

The first department to be worked with... in fact, I will just go through a few departments. My colleagues will cover the other departments. The Department of Public Works received, amongst others, R353 million, intended for the implementation of the devolution of the Local Government: Municipal Property Rates Act. The monies will be passed on to provinces who will, in turn, allocate it to municipalities to evaluate all properties in their jurisdiction, so that they can finally charge levies or give exemption for certain properties that do not qualify. Members need to support this process in their constituencies, because communities resist, because they receive notices that do not explain the purpose of those notices.

The first challenge the department faces is the roll out of the Re Kgabisa Tshwane project, which is supposed to be extended to other cities. The rollover requested has been accepted by the committee, but the department needs to spend this money, as this rollover is being approved for the second time. We propose that the Portfolio Committee on Public Works engages the department on their clear plans of spending these funds. Their second challenge is to address the capacity challenges in the department, to deliver on the expectations of their client departments, as their client departments seriously underspend in capital projects. We discovered that there are no service level agreements between the departments. Many departments underspend on capital expenditure, because the department lacks the necessary capacity.

The other department that was visited was the Department for Co-operative Governance and Traditional Affairs, which has also been allocated over R500 million to assist with provisional free basic services for the poor households. Despite major achievements since 1994, many communities and households still remain trapped in poverty. This should go a long way towards achieving a better life for all.

The department also applied, that is the Department for Co-operative Governance and Traditional Affairs, for a rollover of R287 of the Municipal Infrastructure Grant, MIG. We were informed that 33 municipalities underspent. However, the department wants to reallocate this money to 50 other municipalities that have capacity to spend. This is in contradiction with the Public Finance Management Act. Section 43(4)(a) of that Act says it "does not authorise the utilisation of a saving in (a) an amount specifically ad exclusively appropriated for a purpose mentioned under a main vote". Clause 6.1.4(a) of the Treasury Regulations on rollovers states that unspent funds on payments for capital assets may only be rolled over to finalise projects or assets acquisitions still in progress.

So, the objective of the MIG is to address backlogs of infrastructure. In fact, we were informed by the official of the department that they want to redirect this money, as indicated, to these 50 municipalities. But the objective of MIG is to address backlogs of infrastructure. Now, if you take this money away, it means that the poor communities of those municipalities will remain deprived of the necessary infrastructure development. In many cases, those officials do not understand the situation in different municipalities. At the end of the year, people get bonuses for not having delivered. Section 154(1) of the Constitution states – no, I am just... it is all parties – and I quote, "The national and provincial governments, by legislative and other measures, must support and strengthen the capacity of municipalities to manage their own affairs, to exercise their powers and to perform their functions". Section 34(1) of the Local Government: Municipal Finance Management Act, Act 56 of 2003, states that, "the national and provincial governments must by agreement assist municipalities for efficient, effective and transparent financial management". So, the Department for Co-operative Governance and Traditional Affairs must co-ordinate provincial and local departments and Treasury, to establish support committees for municipalities. The 50 well-spending municipalities should actually be assisted to access the Extended Public Works Programme incentive scheme.

We also met with the Department of Rural Development and Land Reform, which informed us that they are unable to accelerate land restitution, as they have run out of funds. At the end of the second quarter, they were at 91%. I think the Minister indicated that in the House one day. Treasury has not made any adjustments towards land restitution. It is difficult to understand why. The biggest challenge of this department is the price they have to pay for land, which is three times the market value. So, clearly, the willing buyer and willing seller approach does not work. In fact, the department refers to this willing buyer and willing seller approach as a willing buyer and unwilling seller approach. So, the alternative for government is the legal expropriation route. The ANC's Polokwane resolution says, amongst others, "where necessary, expropriate property in the public interest or for public purpose in accordance with the Constitution to achieve equity, redress, social justice and sustainable development. All legislation pertaining to expropriation must be aligned with the Constitution". So, we are not talking about wholesale expropriation. We are talking about expropriation in line with the Constitution. [Interjections.] Yes! [Laughter.]

Also, the request by the Department of Home Affairs for a rollover of R150, to acquire the advanced passenger processing system and also "Who am I Online" project should be granted, as these programmes are necessary for both the 2010 Soccer World Cup and the smartcard identity documents. However, the Department of Home Affairs need to move fast in resolving the tender issues associated with these projects. During the hearings of the first quarterly reports, the department indicated to the committee that they would like to take over the responsibility of this tender from The State Information Technology Association, Sita. The committee agreed with that. The process needs to be fast-tracked as the 2010 Soccer World Cup is just around the corner.

I would like to this opportunity to again thank the members of the committee and the staff, for the long hours they spent in compiling their reports. So, the African National Congress supports the Adjustment Appropriation Bill. I thank you. [Applause.]

Mr M SWART / End of take


Mr M SWART: Deputy Speaker, the worldwide recession affected South Africa much more than we expected. Economic recovery will be slow and uneven, and the recession has resulted in job losses, business closures, reduced consumer spending and, therefore, much reduced income for the state. The expected revenue shortfall of some R70 billion plus will have a serious impact on the spending ability of government and discipline is required in this regard.

I would like to ask the hon Dubazana to listen to this, and when looking at the appropriations, one finds considerable spending by government on social security, which the DA welcomes, hon Dubazana. It remains a matter of concern, however, that provision is made once more to bail out poor performing and poorly managed state-owned enterprises such as the SABC and the Land Bank. How long will government persist in using taxpayers' money to hide poor management, ascribable mainly to affirmative action and cadre deployment?

Considering the expected shortfall in revenue, the Minister had to do a fine balancing act when compiling the appropriations. Thought had to be given to ways of financing the shortfall. The decision to do so initially by way of loans is acceptable, but it will be necessary to bring expenditure into line with revenue as soon as possible. The main options open to the Minister are to either cut spending or raise taxes or both. If government manages taxpayer money wisely however, tax increases can be avoided. Major financial losses occur by way of corruption, as presented to us by the Public Service Commission.

In this regard, they said that 868 cases of financial misconduct by public servants were reported to them in the 2007-08 financial year. The total cost reported emanates from the unauthorised, irregular, fruitless and wasteful expenditure, as well as losses resulting from criminal conduct amounted to R21,77 million in that year. Employees were found guilty in 709 of the 868 finalised cases of financial misconduct. However, only 163, which is 22,75%, of the employees found guilty were dismissed and an amount of just R8,8 million could be recouped. Criminal proceedings were instituted against only 210 of the employees found guilty.

During that same financial year, 249 senior managers in the Public Service failed to submit financial disclosures to the Public Service Commission. This leads one to believe that they might have something to hide and that we may have seen only the tip of the corruption iceberg in the Public Service. The Auditor-General's finding then is, therefore, not surprising that as many as 2 300 public servants benefited from contracts valued at R615 million. Mr Minister, we know that you personally are serious about rooting out corruption. You have stressed that, as Members of Parliament, we should all assist in the fight against and disclosing of any form of corruption, irrespective of political affiliation. We agree with you on this, Mr Minister, and we will disclose corruption wherever possible.

You have also asked, just now, that corruption be depoliticised. Once again, we agree with the principle, as corruption affects everybody, especially the poor. Corruption after all is stealing money from those who need it most. As parliamentarians, however, it is difficult to claim the moral high ground, when we sit here with colleagues guilty of corruption in Travelgate and in all likelihood many other shady deals. [Interjections.] It becomes even more difficult when we learn of taxpayers' money being wasted on the protection of political officials outside of government, such as Julius Malema. [Interjections.]

Little or no action has been taken on these issues, other than protecting comrades in the ANC. The question then is whether we, as parliamentarians, are setting the right example. The answer is clearly no. Politics will, therefore, unfortunately remain the name of the game until such time as we have cleaned up our own act right here in Parliament. I thank you. [Applause.]

Mr L RAMATLAKANE / End of take


Mr L RAMATLAKANE: Deputy Speaker, let me just say, on behalf of Cope, that we will take up the challenge, together with the Minister, to fight corruption. We won't be found wanting. We will join that campaign to fight corruption. Whenever corruption is unveiled, it is me talking. Whenever we see and unravel that, we believe that the Ministers will take action on it. So, we take that call very seriously, and we will bring it to your attention.

Deputy Speaker, dealing with the Appropriation Budget is basically to deal with the budget and also address the departments on unforeseen money that the department has to budget for and shifting of programmes. But what we have seen in this Adjustments Appropriation Bill is basically a new trend, on a scale that has been unseen before, of basically departments using the words "unforeseen expenditure" and "unavoidable" when talking about huge amounts of money. This actually doesn't necessarily account for "unforeseen" but bad planning.

The second thing that we are worried about is a trend that we have seen in this department of shifting and building of top-heavy Ministries. We wonder whether this is not necessarily the management of a political divergence and the management of various political interests in the party. Actually, we are worried about the bloating and top-heavy structures. We are worried about the fact that some of these shifts are creating top-heavy structures - the shift of money from functions.

The last thing that we want say, Minister, is that it is not all about the shift and the creation of the department or unbundling that is wrong. For example, one can look at education. It is good that in education the issue about post-schooling skills is going to be transferred. The 23 Sector Education and Training Authorities, Setas, are going to be transferred from the Department of Labour into the Department of Education. That's good. We need to support that, because it is about addressing the challenges that we have.

Then, the period ahead of us, is going to be bumpy, because we are going to make sure that there is accountability. In heeding the call of the Minister, there will be oversight to ensure that the department actually sticks to its plans, sticks to its programmes and that Ministers will be accountable, by appearing before the committees when they are called and not hiding behind the Public Finance Management Act. The Public Finance Management Act afforded us the department officials or accounting officers, not Ministers. Accountability means you appear; you take political responsibility, because the buck stops with the Minister.

Therefore, as Cope, we want to say we are going to stand up and rise to those particular challenges, Minister. We want to come to your committee. I am sure you are going to listen to that. Thank you. [Applause.]



Mr M G ORIANI-AMBROSINI: Madam Deputy Speaker, the IFP carries in the Adjustments Appropriation Bill its misgivings about the Medium-Term Budget Policy Statement, MTBPS, as this Bill reflects the Medium-Term Budget Policy Statement's missed opportunities and lack of urgency.

The Bill should have been the tool to begin bringing about the required structural adjustments which we feel are necessary. This would have been the time to begin merging the many senior government institutions, providing essentially the same services to Small, Medium and Micro Enterprises, SMMEs, thereby avoiding committing R1,7 billion in the future for the Khula Direct when, effectively, the National Empowerment Fund can provide the same services, and all their agencies can be assembled in a matter of weeks, or perhaps, months, as commercial entities do when merged into a single entity.

This would be the time to shut down the noncommercially viable aero-manufacturing division of Denel, to avoid recapitalising something that continues to lose money. It would be the time to privatise SAA, SAA entities and older State-Owned Enterprises, SOEs, as an alternative to rising public debt, wherever it is possible.

It would be the time to transform the Land Bank into a specialised division of the Industrial Development Corporation, IDC, rather than recapitalising it with R1 billion, to perpetrate its 20 year management crises and corruption track record. It is really a matter, at this point, of putting good money after bad money, rather than providing it with the management it needs.

This would the time to relook government-assisted economical sectors, which are not viable in the global market place, rather than increasing their subsidies, and focus it, as it had to be, on social services. Since 1994, South Africa has not undertaken a structural transformation of its parastatals and of government's industrial policies, with the end result that the pre-1994 mould is being kept alive, in fear that anything replacing it may be worse. More suggestions, as the Minister asked, will be coming by letters. Thank you very much. [Time expired.] [Applause.]

Ms B T NGCOBO / End of take


Ms B T NGCOBO: Deputy Speaker and members, the Medium-Term Budget Policy Statement, MTBPS, we debate here today is a statement of courage and hope in the most turbulent time in recent economic history. We must look beyond this crisis and encourage the expansion of public services, especially in the areas of education and health. It is in this spirit that we welcome the MTBPS within the current difficulties we face.

In this regard, the ANC has set a programme to improve education by: progressively expanding the nutrition programme to include high school learners in poorer communities; improving the national norms and standards in teaching and learning including providing learner-support material and adequate education infrastructure; reviewing our curriculum to best suit the needs of the developmental state; reviewing Adult Basic Education and Training to ensure that it better responds to the skills demands of the country; establishing a National Education Evaluation and Development Unit for purposes of monitoring, evaluation and support; expanding the number of no-fee schools and progressively introducing free education for the poor up to undergraduate level; improving the conditions of service of teachers; fast-tracking early childhood development to ensure universal access to Grade R by 2010 and doubling the number of 0 to 4-year-old children by 2014; and to enhance the quality of education and skills development focusing on improving the foundation phase literacy and numeracy and on increasing the number of learners that pass Grade 12, particularly in mathematics and science.

We welcome the additional adjustment of R524 million allocated for workloads on literacy and numeracy for Grade 1 to 6 in Quintile 1-3 schools, and the total adjustment of R561,6 million. An adjustment of R12 billion for salaries to provinces has been given, however, this is not specifically for education.

One of the critical areas of spending that will require more resources over the medium-term is our health care system. We therefore welcome the department's ten-point plan and hope that this will lay the foundation for the universal access to free quality health care supported by the National Health System, and revitalisation of hospitals.

We recommend that our spending on health care over the medium-term must focus on developing a reliable single health information system; intervention to reduce the high cost of health provision; developing recruitment and human resource development strategy for health professionals and preventing the exodus of health professionals to other countries; accelerating the roll out of the comprehensive health care programme, such as provision of antiretroviral treatment which will be dispensed at all health facilities; and accelerating the programme for hospital recapitalisation and revitalisation including innovative solutions that will accommodate private, public partnership.

The adjusted estimates reflect that the total increase for the department amounts to R1,3 billion, which includes 17% rollover funds from 2008-09.

One of the biggest challenges facing our health care system and poses a significant threat to our future is HIV and Aids. The current death rate from HIV and Aids-related deaths is becoming higher than that of the birth rate. We must urgently address this matter with a focus on prevention and treatment.

Adjusted estimates include R900 million for antiretroviral treatment and Comprehensive HIV and Aids Care Management and Treatment; R160 million for H1N1 influenza; R20 million for countrywide measles and polio mass immunisation campaign; R30 million for 2010 World Cup Health preparation strategy grant; general salary adjustments for the national Department of Health is R11 million; and for the public entities National Health Laboratory Service and Medical Research Council, R7,3 and R5,8 million respectively.

We support the adjusted appropriation R18 billion for health care. We welcome the MTBPS and wish to congratulate the Minister of Finance on achieving his tasks under these difficult conditions. We further welcome reallocation of resources towards our five key priorities and look forward to a government that spends more effectively without cutting back on service delivery. The ANC supports the MTBPS. Thank you. [Applause.]

Ms M N MATLADI / End of take


Ms M N MATLADI: Chairperson, the UCDP accepts the adjustments made in the Appropriation Bill. We, however, would like to highlight the following: Very few departments do get a clean bill on audit opinion, which means that most of the units in financial managements are still wanting. I could give an example of the Department of Science and Technology, which has received a clean audit opinion for the previous financial year. Well done! However, eleven departments still received a qualified audit opinion.

Of serious concern is the Department of Defence, which received a qualified audit opinion for seven consecutive years followed by the Department of Labour, which has four years of qualified audit opinion and the Department of Public Works had an irregular expenditure of R5,4 billion.

Underspending by departments is another concern which has resulted into rollovers of R1,5 billion for infrastructure and building projects, and it spells out that work has not been done.

There are major strides taken to improve the Department of Home Affairs which still has to pay attention to the following: Its revenue collections - about R356 million revenue couldn't be supported by documents in this department; there was an irregular expenditure of R198,2 million; and corruption is still the main challenge in the Department of Home Affairs. With these remarks, we support the Adjustments Appropriation Bill. I thank you. [Applause.]

Dr P J RABIE End of take


Dr P J RABIE: Hon Chairperson, hon Ministers, hon Members of Parliament, the brief of the Appropriations committee is that of parliamentary oversight. Allow me to mention that the committee had a number of public hearings with all government departments, the Human Science Research Council, the Financial and Fiscal Commission and a number of independent economists.

Before I discuss appropriations within a number of departments, allow me to mention the following - and it has been mentioned before - the tax revenue has declined and what we need is a leaner and more efficient Public Service. The downturn in the economy has adversely affected millions of South Africans and is estimated that by 2009-10 9,7 million, almost 10 million South Africans, will depend upon social grants.

I agree with the hon Minister of Finance that our present social welfare system places a heavy burden upon a relatively narrow tax base. Hon members, be assured that the DA is very much in favour of our present welfare system. The question, however, is, will we be able to afford this in future? I think, therefore, that it is extremely important that we encourage sustained future economic growth if we want to alleviate the plight of the poor. What we need is a holistic growth strategy which will represent the public and the private sectors, and will have to take proactive decisions to address irregularities regarding corruption, fraud, factors which inhibit service delivery and growth. This came to the fore during the public hearings.

In an excellent submission to the Portfolio Committee on Appropriations, the Human Science Research Council reported that 50% of all households in rural areas experience hunger on a daily basis and that 50% to 80% could not afford minimum nutrition prices. It was also reported that rural households spend 9% to 15% more than urban ones for the same basket of food. What was extremely worrying is that 51% of all severely hungry rural households qualified for grants, but they did not receive them according to Human Science Research Councils. The DA concurs with the committee that rural development, household food production and food security need serious re-examination seen in the light of the steep rise in the price of basic food.

I represent a rural constituency. Rural economic development must become a key priority over the next three years. To illustrate the plight of the rural areas, the Human Science Research Council submitted that of the 18 Land Redistribution for Agricultural Development projects, only two are still in place. All the others have collapsed. Now, the question is why? Somebody must account for that. I think it is of utmost importance that we address this.

Forty percent of all South Africans live in rural areas, but less than 10% are economically active. This untenable state of affairs cannot be allowed to continue.

Education and higher education will have to address the fact that more than 50% of the youth leaving school today are unemployed. The Human Science Research Council suggested in this regard that we must discuss the possibility of a youth transitional job scheme and rethink the present school curriculum.

A number of issues regarding the Department of Health are the alarming exodus of doctors, dentists, nurses, pharmacists and emergency personnel. It's always also mentioned to us that the campaign against HIV is important and it is expected that more than 900 000 people will receive antiretroviral treatment by the year 2012.

It is also indicated that for the past eight years there has been an underfunding of the public health sector which has led to deterioration in the Public Health Service. The proposed new health insurance will have to be properly costed in the forthcoming financial year ... [Time expired.] Thank you. [Applause.]

Mr J P GELDERBLOM / End of take


Mr J P GELDERBLOM: Chairperson, hon Ministers and members of the House, we are indeed living in exciting times with a lot of change and renewal taking place also in our government and society at large. I share the sentiments of all who are grateful for the hard work that went into the preparation of the Adjustments Appropriation Bill. This was done in a difficult time where we have to cut, save and shave in order to tighten our belts.

Many of the so-called adjustments we saw in the Bill - I will mention but three - provided for the shifting of money to the new departments to continue uninterruptedly with their functions. This was in particular the case for Agriculture, Forestry and Fisheries that replaced the old Department of Agriculture, which will cease to exist due to the reorganisation and a total of almost R2,8 billion had to be shifted from Vote 23 to Vote 35. A further R487,6 million is shifted to this new department from the old Department of Water Affairs and Forestry for the same reason as the funding follows the function.

The new Department of Water and Environmental Affairs under Vote 43 get R7,4 million from the old department's Vote 34. For the same reason due to function shift R2,3 million shifted from the Department of Co-operative Governance and Traditional Affairs - the old Provincial and Local Government department - to the new Department of Rural Development and Land Reform. The whole of the former Department of Land Affairs is part of the dowry of its successor.

We welcome the changeover to the new model where essential services are clumped together under agriculture, where water had to shed forestry to agriculture, and land took over the new function. Most will continue their tasks without problems.

Under the strains of the current economic climate, we, together with our officials, have to work smarter with the money allocated in order to derive the maximum benefit for our people.

As Parliament and the relevant committees, we will have to keep an eye on developments and make sure targets are adhered to when we get to the quarterly reports.

On the rollovers, an amount of R227 million for the construction of the De Hoop Dam was necessary. This is to be welcomed as water is such a precious commodity and we have to provide for future use under increasing challenging conditions.

Water and the availability of high quality drinking water stay a priority and we should not run into any problems in future. Therefore, it is prudent for us to invest now in water infrastructure, not only to stimulate economic development, but to also supply those that still do not have sufficient clean running water and to prevent our country from running into any tight corners. We all know of the changes our climate undergoes. We also know how much we are dependent on this precious resource to sustain life and future growth. There are also vast sums of money rolled over to keep the agricultural sector healthy. This is vital for food security and sustainability.

A major point of focus for the future of our country is rural development. Agriculture and water will play a very important role in this. We are happy as the ANC that vast amounts of money had been contributed to the reform of agriculture. Let me remind this House that in the state of the nation address, the hon President Zuma said:

People in the rural areas also have a right to electricity and water, flush toilets, roads, entertainment and sport centres as well as better shopping centres like those in the cities. They, too, have a right to be helped in farming so that they can grow vegetables and other things and raise livestock so that they can feed themselves.

We have developed strategic thinking around rural development, but we also have to consider many practical directions and new thinking of how we will take on this challenge against the complex background of land reform and transformation. It has to address the injustices of the past, foster reconciliation and stability, stimulate economic growth and alleviate poverty by improving household welfare.

We need all South Africans to revise their approach to rural reform. We need innovative thinking as to how we go about acquiring land, settling people with a view to succeed and be sustainable, but most important, it is vital to do it in such a way that we arrive at harmonious and sustainable solutions.

We do not need people who employ resistance tactics, but progressive ways of solving problems. In this regard there is enough expertise available to assist in negotiations and concluding the many outstanding matters. We have to work together to improve our output in this regard. This is where we should employ the innovative thinking I mentioned earlier.

From our side of the House, that is now the ANC side, we will stay on course to the goals set out in our founding documents that also followed its historic course through Polokwane into a modern and exciting state, gearing for the future that we all long for. A joint future that brings hope and a better life for all who live in South Africa. As South Africans, we are a people full of optimism and working together we can do more to stay relevant in the global village through discipline, dedication and hard work. We support the Bill. Thank you. [Applause.]



The MINISTER OF FINANCE: Chairperson, we need to, firstly, remind ourselves that the Adjustment Budget merely allows for unavoidable and unforeseeable expenditure to be taken account of.

Let me, firstly, give an assurance to those members who raised concerns about whether this provision has been applied correctly. I want to say that it has, that we have been very careful, and that, in fact, a number of requisitions for funds to be allocated through this mechanism were turned down, because the Treasury committee, not any individual, was unconvinced that it amounted to unforeseen and unavoidable expenditure. There were also a large number of applications for rollovers. Not all of them were approved. Only those that had legitimate reasons given, which is largely about long-term commitments to projects, were actually allowed.

Secondly, let us also give credit where it is due. Many years ago, underspending was a serious problem in many areas, at provincial and at national level. Today, underspending in the old form is no longer a problem. Now the question is the quality of spending and the quality of outcomes and whether we are getting the value for money that we would actually require.

Some colleagues have raised issues about the Municipal Infrastructure Grant, MIG, during the course of these hearings and the speeches made today. We are in agreement that this is something that we need to look at more carefully, given that we want better and more effective delivery at a local government sphere level. My colleagues from the Department for Co-operative Governance and Traditional Affairs will be engaging with us in further discussions on that.

Land restitution, rural development and agricultural development have been mentioned by several hon members, as well. Minister Nkwinti and we are very mindful of the necessity for more money to be allocated to land restitution. Let us be frank. We have reached a point in this process where it is totally unaffordable to carry on on the old basis. Some new basis has been found, and I am going to leave it to Minister Nkwinti to address those issues when he interacts with Parliament again. Let us be assured that the focus of government, as a whole, on agricultural development and rural development is a very profound one, and, as we move on, we will see a lot more reserves coming from these two areas. Many of the thoughts that have been expressed at the podium today will see fruition I am sure, as we find our feet in these areas. So, there is a very profound commitment to ensuring that we do create better work opportunities for our people in the rural areas.

Several colleagues have addressed the issue of bailouts. Again, let's be quite emphatic. Bailouts are not going to be an endless mechanism of funding for foolishness, mismanagement, poor judgment, poor strategic leadership or no leadership at all. We are absolutely clear about that. So, all of the colleagues on this side of the House to whom I have responsibilities for State-Owned Enterprises, SOEs, it is quite clear that over the next period and, already, for the last few months, we have imposed very tough terms on SOEs that require state assistance. Those terms mean that this assistance is not an endless process. It has a very finite purpose. We expect finite things to be done. We expect the right things to happen within SOEs. Otherwise, the SOEs, themselves, must actually review the purpose for their existence.

Cabinet has also decided that there will be a review process for all of the SOEs, together with the relevant Cabinet colleagues, to decide whether they still have a purpose, whether they operate as effectively as they can do, whether they duplicate some of their functions, and whether there can be greater efficiency in the way they operate. Minister Hogan and I, amongst others, are responsible for initiating this process.

We also agree with colleagues that greater productivity is required from the Public Service. Here again, we have to emphasise that we have to do more with less. Once again, some of our colleagues have come back to the question of corruption, and are equivocating. Corruption cannot by qualified. I think we must be quite unequivocal and quite unqualified about the necessity to root it out. Now, there are all sorts of ifs and buts that all of us can put forward. The one message we need to be absolutely categorical and unequivocal about is that it is not going to be tolerated in any form, anywhere, by anybody, on any side of this House. [Applause.] That is the message that we need to get through.

We agree with Dr Rabie, for example, that we want to get the right balance between welfare and work, between those who are supported by social grants and the tax base that they actually depend upon. That is why, over the next while, we are going to have a lot more emphasis on enterprise creation, entrepreneurship and job creation, so that we can actually widen our tax base and have, not just for the purposes of supplying more grants to people but rather to ensure that people have the dignity of their own income and the ability to make decisions about their own welfare, on the basis of what they get. A wider tax base will also enable us, as government and as society, to take on many more challenges that we have, in respect of both our legacy and our future challenges.

So, let me thank everyone concerned for their contributions and for their positive support of the Adjustments Appropriation Bill. Thank you. [Applause.]

Debate concluded.

Bill read a first time.




(Consideration of Votes and Schedule)

The HOUSE CHAIRPERSON (Mr K O BAPELA): The proceedings will initially take the form of a question and answer session. I shall put each Vote in respect of which adjustments have been made in turn, whereupon members will have the opportunity to ask questions to the relevant Ministers, in respect of these adjustments. Each party has been allocated a global time for all Votes. Once a party's time has expired, they will not be allowed to put further questions. Members must please press the request to speak button, if they wish to ask a question. Hon members will please wait until I recognise them before putting their questions.

Discussion on Votes and Schedule concluded.



Vote No 1 – Presidency - put.

The LEADER OF THE OPPOSITION: Chairperson, the DA wishes to raise concern over the extra R7,6 million that has been allocated for the establishment of the hotline that was originally planned to be established for R4 million, especially around the fact that the operational functionality of this hotline is seriously questioned. However, our greatest concern is the additional R12 million allocated for outstanding legal fees. Our efforts to determine what these fees are for have yielded nothing to date. In the absence of this information, the DA cannot support this adjustment for this unavoidable and unforeseeable legal expense.

The MINISTER IN THE PRESIDENCY: NATIONAL PLANNING COMMISSION: Chairperson, in respect of the hotline, I think that the hon Trollip would be aware of the fact that there were teething problems in the early period, but now it is entirely transparent. There is a flow of information and the responses are there. So, if the grounds that he opposes it on are the teething problems before the actual launch in the pilot period, I want to submit that the grounds are pretty spurious.

In respect of the legal fees, there are two aspects to this. The one is that it is very hard to budget for legal fees, partly because fees are generated, and you can't, in the middle of the year, say this particular litigation now has to end. In the course of an institution like The Presidency anywhere, where there is extensive litigation not just in the volume of litigation but also in the fees, it is something entirely outside of the control of any arm of government. For this reason, the request was put. The Treasury committee applied its mind to it, and I am pretty sure that this will be money well spent.



Mr L S NGONYAMA: Chairperson and hon Minister, the view of the Congress of the People is that in the current economic and service delivery challenges facing our country, we definitely would have preferred that priority is given to funding service delivery programmes directly, rather than the expansion of the Cabinet, which cost an estimate of R170 million. Was there no alternative that could have been found to deal with the challenges facing the Presidency?

The MINISTER IN THE PRESIDENCY: NATIONAL PLANNING COMMISSION: Hon Ngonyama, I am not quite sure where that view is from, because it might be way down there. In the context of the number of Ministries, I think that those who were around in 1994 will know that we moved straight in. All of the offices were there. But in the course of the past 15 years, a detailed evaluation was done, led by a team, which my colleague, Minister Chabane, actually led, that looked at every Ministry and its performance. It even went through the questions that I asked here in Parliament about them. Then the team arrived at a very strong motivation for the expansion of each of these.

In the position that I am presently, in the Planning Commission, I think it is something that we will debate at some length tomorrow, but I think that the one issue that is not in dispute is that we need a planning capacity that hasn't been there. I think, similarly, if you explore all of the other Ministries, it is necessary to understand that we need to strengthen those who take policy decisions and those who will be accountable for those decisions, which is why the Cabinet was expanded in the way it was. Thank you.



The LEADER OF THE OPPOSITION: Chairperson, this is just a follow-up. We remain concerned, hon Minister, that the cost of establishment was estimated to be R4 million. We are now allocating double that again to the hotline. The concern around the legal fees, and I accept that in the Presidency legal fees are very difficult to budget for, but we would like to know whether these legal fees have got anything to do with a legal case that the President was involved in, personally?

The MINISTER IN THE PRESIDENCY: NATIONAL PLANNING COMMISSION: Again, I think that in the context of the conventions, if people are entitled to legal representation within the rules, all of these are aggregated and the decisions on the particular allocations are entirely fungible within the administration. You cannot say that there was a case running, arising from the point when his Excellency, Jacob Zuma, was Deputy President, and now he becomes President and you cut this thing off. I think that in the convention these things flow together, and it is necessary that we accept that as a norm.

What you can't escape from is that government runs in relation to opposition on the basis of trust as well. I want to look the hon Trollip in the eye and say that President Zuma, on a number of occasions, has taken unprecedented steps to work with the opposition, to afford them opportunities to ask their questions, to build trust, and it is very important that that be the platform that we take forward. Thank you.



The HOUSE CHAIRPERSON (Mr K O BAPELA): Order! I see hon L Ramatlakane, hon D Carter, and hon H Ndude from Cope. Is it on the same question? Not on the same question? I am guided by the screen, because I only put Vote 1 so far, and now you have all pressed. Are you coming?

Ms H N NDUDE: Chair, I am covered. My question was on the legal fees.

Mr P F SMITH: Chair, if one regards to the adjustment, it is R170 million, of which R96 million is unforeseeable and unavoidable, pertaining largely to the setting up of the new department, I understand, the new Ministries. My question, Minister, would be when is it expected that two Ministries will be fully up and running, the departments fully up and running, as well as the third department? Are we going to be in a position next year, for example, where we are also having unexpected, unavoidable expenditure in respect of departments, which are still in the process of being established, or will this exercise be completed by the time of the main Budget next year?

The MINISTER IN THE PRESIDENCY: NATIONAL PLANNING COMMISSION: Chair, the numbers for the three departments are quite different. The Ministry that deals with performance monitoring and evaluation already has an infrastructure in place, because there was always a Ministry in the Presidency. In the adjustments estimate, there is provision for the expansion of that unit, so that should move through.

The Ministry of Women, Children and People with Disabilities will actually exit from the Presidency and establish its own infrastructure. That should be dealt with by the time of the Budget in February. Similarly, depending on what transpires in this House tomorrow on the Green Paper and the debate in the NCOP next week, we should, by the time of the Budget in February, have a fixed number. I think that the relationship that the Treasury would lead government into with Parliament is to try and provide maximum certainty, so that the provision for unforeseen and unavoidable expenditures is used sparingly. That would be the case now; it's been the tradition, and I would imagine that it would be a convention carried forward. Thank you.

Agreed to.

The Democratic Alliance and Congress of the People dissenting.



Vote 2 – Parliament put and agreed to.

Ms J D KILIAN: Chairperson, can I just quickly ask you? One of our members, member Carter still wanted to ask a question on Vote No 1. She was mentioned.

The HOUSE CHAIRPERSON (Mr K O BAPELA): Well, I did ask whether there were any, and then hon Ndude gave up, but we can go back to it then. Let's just get you, hon Carter. No, no, it is their time that they are eating into. Just leave it that way. It is the rules.

Ms D CARTER: Chairperson, thank you. Cope's concern is why has an additional R13 million been allocated for travelling expenses, etc. However, only R4 million has been allocated towards the Ministry of Women, Children and People with Disabilities.

The MINISTER IN THE PRESIDENCY: PERFORMANCE MONITORING AND EVALUATION, AS WELL AS ADMINISTRATION IN THE PRESIDENCY: You would notice that a number of new Ministries have been allocated money to start setting up their administration, as you know most of them are new. That amount is basically for that purpose, and, as we go into the new financial year, and when the systems and the administration have been put up by the various departments, including this one, a new budget is going to be allocated in accordance with the functions and the programmes, which will be in those departments. Basically, that is what accounts for the difference. Thank you.

Agreed to.

Vote No 3 – International Relations and Co-operation - agreed to.



Vote No 4 – Home Affairs – put.

Mr M MNQASELA: Chair, in light of the fact that R213 million has been allocated to Home Affairs, to a department that lacks proper financial management, lacks financial leadership, and of course displays a consistent trend of qualified audits, I would like to ask the Minister: How will you ensure that we prevent this poor financial management in the future? For this reason we are opposing this increase.

The MINISTER OF HOME AFFAIRS: Chair, before I even answer the question, the hon member has decided he is going to oppose. But anyway, I will answer the question.

First of all, until about two months ago Home Affairs had an acting chief financial officer, who had been seconded from somewhere. Now we have a permanent chief financial officer who is going to look after the finances of the department.

Secondly, it is very clear that the major problem in terms of the qualification comes from the revenue. The revenue is collected, but it is not reconciled. So we are training our people in the offices that they must work almost like a bank, that every day they must say, this is the service that was requested, this is the amount that goes with this service, and reconcile every day. If they do that, we will be on our way to improving the financial management.

The second area of qualification was around asset management. The assets had been recorded, but the problem came when assets were moved. The problem was partly that the asset management was centralised. You cannot sit in Pretoria and be responsible for assets that are sitting in Pietermaritzburg. In every office there must be somebody in charge of assets, who will account for the assets in every office. But if you centralise it, it is very difficult to maintain good management of those assets. So we are doing that, but I think hon members must understand that we are training people to do this. It is not going to be an overnight thing. We are hoping that it won't be long before we also have a clean audit, but it is going to take a few months to do that.

I am just being honest with you, because I believe that I have to answer questions honestly and give the House an honest perspective. But it is regrettable that the hon member didn't even want to hear the answer before making up his mind. Thank you. [Applause.]



Mr M G ORIANI-AMBROSINI: Mr Chairman, we heard today from the Minister of Finance that the allocation to the immigration function of Home Affairs is tied to the development of the card component of the Hanis Project. If I understood that correctly, the question is in developing the Hanis Project. How much of this money has already been tied into the decision to implement the smart card with its microchip component? If that has been implemented, how much consideration was given to the findings of the Buthelezi administration of Home Affairs that the microchip was a waste of money and the findings of the Prof Haysom Commission on the matter?


UNGQONGQOSHE WEZASEKHAYA: Ngicela angiphindele Sihlalo, angizwanga kahle ukuthi uthini.


HOUSE CHAIRPERSON (Mr K O Bapela): The Minister is asking you to repeat the question so that she can understand the question properly.

Mr M G ORIANI-AMBROSINI: With pleasure, Chairperson. The Minister of Finance drew a connection to the smart card. The options on the smart cart are to have a microchip or no microchip. During the Buthelezi administration of Home Affairs ... [Interjections.]

HOUSE CHAIRPERSON (Mr K O Bapela): Order, hon members!

Mr M G ORIANI-AMBROSINI: ... a commission was established, led by Prof Nicholas Haysom, which looked into the issue and decided that it was a waste of money, and that there were cheaper opportunities. So the question is: How much of this allocation is already tied to a microchip smart card to complete the Hanis Project?

Mr A M MPONTSHANE: Chairperson, on a point of order: The request came from the hon Minister for the hon member to repeat his question. Will that not eat into our time?

HOUSE CHAIRPERSON (Mr K O Bapela): No, it will not eat into your time.

Mr A M MPONTSHANE: Thank you.


UNGQONGQOSHE WEZASEKHAYA: Sihlalo, ungibuza ngento eyenzeka mhlawumbe ngangisase Mnyangweni Wezempilo, mhlawumbe ngangise Mnyangweni Wobudlelwane Namazwe Omhlaba, angazi. Kunguye umluleki wayo yonke lento eyayenzeka. Kodwa impendulo yami ithi:


Regarding the smart card, we have decided, as was decided by my predecessor, that the smart card is essential for Home Affairs, and we continue with that decision. Obviously, when we start putting together the smart card, we will decide whether it has a microchip or not. I think it would be necessary to have a microchip, but we are not there yet. Thank you. [Applause.]

HOUSE CHAIRPERSON (Mr K O Bapela): Thank you, Minister. I want to really caution members that when you ask questions, they must be related to the subject matter, which is the Adjustments Appropriation. You should not go all over, around those particular issues.

Mr P F SMITH: Chairperson, on a point of order: On the matter of adjustments, is it possible for anybody to adjust the air conditioning in here?

HOUSE CHAIRPERSON (Mr K O Bapela): They will attend to it. Thank you for that.



Mr B A D MARTINS: Chairperson, the Minister of Home Affairs, in her Budget Speech to Parliament, was frank on the challenges faced by the Department of Home Affairs, and we gave an undertaking, as the portfolio committee, to work hand in hand with the department. As a result of that process, we have visited all major ports of entry to South Africa, and we have compiled a report on our visits and the challenges faced by the Department of Home Affairs.

When we started at the beginning of this year, there was a turnaround strategy in place to deal with a multiplicity of challenges, but there have also been successes. I am sure that the Minister would be able to brief the House on progress that has been made in regard to challenges found at the border posts and also the offices of Home Affairs. Thank you.

The MINISTER OF HOME AFFAIRS: Thank you, hon Chair, and thank you to the chairperson of the portfolio committee. Yes, members would remember that my predecessor put together the turnaround strategy. Amongst other things, it would look at how to make sure that the ID, instead of taking 120 days or more, takes less time. Processes were put in place, and indeed a process was also put in place called "Track and Trace", which allows the applicant to track and trace where his or her application is. But the department also uses that "Track and Trace" process to inform members. Any member here who has applied for an ID recently will tell you that when they apply, they receive SMSs saying "we have received your application", "now it is being printed", "now it is being dispatched", "now it is in the office where you can collect it".

The turnaround strategy for the ID has resulted in an improvement of about 50% on the 120 days it used to take ...

Mr M J ELLIS: Mr Chairman, on a point of order: You have just asked members to make sure that the questions are related to the Adjustments Appropriation. What we are dealing with now, is way beyond that, Sir. I am asking you to instigate your ruling that in actual fact we focus on the issue at hand, which is the Adjustments Appropriation.

HOUSE CHAIRPERSON (Mr K O Bapela): I just said that members must be cautious, so I am hoping that they will be cautious. Let us just proceed and see the improvement.

Mr M J ELLIS: Sorry, Mr Chairman, it is not just a question of being cautious.

The HOUSE CHAIRPERSON (Mr K O Bapela): Hon Ellis, I did make that ruling. I said caution should be taken.

Mr M J ELLIS: I am asking you, Sir, to implement the Rules as they should be. This has to do with the Adjustments Appropriation, and questions should be related to it, and answers should be related to it. There is no need for any long discussions on other matters.

The HOUSE CHAIRPERSON (Mr K O Bapela): Correct, hon Ellis. I said cautionary measures should be taken by members when they ask questions. Can we allow that to then begin to improve in the House. Hon members, I think I will make that appeal. However, Minister, you are on the floor – continue.


UNGQONGQOSHE WEZASEKHAYA: Sihlalo, into embi ukuthi la bantu laba bafuna ukuthi kuphendulwe imibuzo yabo kuphela, eyabanye ingaphendulwa.


When it is their questions, relevant or irrelevant, they never stand up and say, "that question is irrelevant." When an hon member from this side has asked the question and I am trying to answer ...

Mr M J ELLIS: Mr Chairman, on a point of order: The hon Minister is standing up now and accusing us of things that we actually don't do. We are saying that we are asking questions on the Adjustments Appropriation, and the Minister has no right to stand up and say that we don't.

The HOUSE CHAIRPERSON (Mr K O Bapela): I get your point. But she never referred to anybody; she was just generalising. So can we just allow the Minister to finish? [Interjections.]

The MINISTER OF HOME AFFAIRS: Should I continue? How much time do I have?

The HOUSE CHAIRPERSON (Mr K O Bapela): Ministers have unlimited time, in terms of the Rules. [Interjections.] So can we just leave it? The more you interject, the more you give them time yourselves. So just leave the Minister to proceed. These are your Rules.

The MINISTER OF HOME AFFAIRS: Thank you, hon Chair. Maybe the hon members must understand what our mandate is. If we talk about improvement, everything I have talked about is within the mandate of Home Affairs, and is within the turnaround strategy. I have not moved away from the question.

Secondly, I would like to say, as hon Oriani-Ambrosini was talking about microchip, we now have state-of-the-art passports, which you get in a very short time. I don't know whether any of you have applied for a passport recently. The state-of-the-art passport has a microchip, hon Oriani-Ambrosini, and it has been turned around. Also, if you have lost your ID, you can get a temporary ID on the spot. We can scan your finger, and we can verify that you are on our population register, and we can give you an ID.

Hon members, let me also take this opportunity to say that we have started, and are going to accelerate, the registration of children at birth. I hope hon members, during the recess, will take the opportunity to encourage their constituents to register their children. We also want everybody who doesn't have a birth certificate to have it within a year. So in your constituencies, hon members, make sure there is no single person who doesn't have a birth registration certificate. [Interjections.] At the end of one year, we are going to do away with late registration. So they must do it now.

Also, all people in your constituency must have an ID, because, as politicians here, we are going to do away with the ID campaign during elections ... [Interjections.]

The HOUSE CHAIRPERSON (Mr K O Bapela): Hon members, you are being out of order. That is not parliamentary. You cannot disrupt the House by clapping your hands, and you know that is completely out of order. The Minister is responding to a question that was raised, so can we just allow her to complete the response.

Mr M J ELLIS: Mr Chairman, again on a point of order: Sir, it is the same point of order.

The HOUSE CHAIRPERSON (Mr K O Bapela): Mr Ellis, I think you misunderstood me. I did not say "do not"; I said "caution should be exercised". And "do not" and "caution should be exercised" are two different things. I just said that "caution should be exercised" that we are discussing adjustments. [Interjections.]

Mr M J ELLIS: Mr Chairman, I want to question your ruling.

The HOUSE CHAIRPERSON (Mr K O Bapela): So on the cautioning, I appealed to members, but I did not say to members "do not". I said "caution should be exercised" that we are dealing with the adjustments. So the IFP did engage on an issue, and I allowed it. The ANC has engaged on the issue, and I am allowing them, so I am being balanced in the probabilities.

Mr M J ELLIS: On a point of order, Mr Chairman: I am questioning your ruling. I am saying, Sir, that I believe that you are wrong. You should not allow those questions that are not related to the Adjustments Appropriation to be put, and neither should Ministers be allowed to respond to them. I am saying, Sir, that you should be directing this meeting according to the Adjustments Appropriation Bill, and nothing else.

The HOUSE CHAIRPERSON (Mr K O Bapela): Thank you, hon Ellis. Hon Ellis, I didn't say people "should not", and I am repeating that. I said "caution should be taken" that we don't go all out. As much as possible, we should confine ourselves to the matter where possible. And members will use their judgment. Hon Minister?

The MINISTER OF HOME AFFAIRS: In conclusion, hon Chair ... [Interjections.]

The HOUSE CHAIRPERSON (Mr K O Bapela): Order, hon members!

The MINISTER OF HOME AFFAIRS: In conclusion, I want to caution all of us here: There will be no ID campaign in 2011 during elections. It will not happen. The ID campaign is now. In 2011 nobody is going to put Home Affairs in a pressure cooker for an ID campaign. Thank you. [Applause.]

HOUSE CHAIRPERSON (Mr K O Bapela): Hon members, can we really proceed with that caution that I have requested, to ask questions that are more relevant to the adjustments? Secondly, I know that this is not the first time that we are dealing with questions to the Ministers, but I know that in the past the ANC has not participated. Now I think the ANC has decided to participate. Let us just allow that procedure to take place and really respect the running of the House and the Chair. I think the issue of slow-clapping was really out of order.



Mr M MNQASELA: Chairperson, in light of the explanation by the Minister, I wonder what a bank does when a teller says "I fail to reconcile my account". Does the bank keep the teller or fire the teller? What do they do?


UNGQONGQOSHE WEZASEKHAYA: Baqalile ke, uma sengibaphendula bazosokola.


Hon members, obviously when somebody doesn't do their job, there are procedures. You give them a first warning, and if they don't perform, eventually, you fire them. That is standard procedure. I am sure in the DA, if they don't perform and you don't win elections, they must fire the person who is supposed to do the work. But, yes, clearly, we are going to fire people who don't do the work, but we train them. As I said in my first response, we are training them. Because it doesn't help to just fire somebody when you have not trained them. Give them an opportunity, train them, and if, after training, they don't perform, it means they are not willing to do so. It is not because they do not know. So the first step is training. Then after that, we make sure that they perform. Thank you.




Mnu B W DHLAMINI: Sihlalo, Ngqongqoshe ukhuluma into enkulu la uma uthi abantu abazelwe ababhalisele izitifiketi zokuzalwa, abangenabo omazisi bababhalisele manje.

Lapho engikhulele khona eSoweto eBonjini, lapho abantu abazalelwa khona kungekho ngisho umtholampilo noma isibhedlela. Umuntu angabi nasicucu nje sokuthi athi wazalelwa lapho.

Ngabe umnyango ka Ngqongqoshe uzokwenza kubelula yini ukuthi abantu bakwazi ukuthola usizo; nongakaze asonte kungashiwo ukuthi akaye kumfundisi ngoba akamazi umfundisi? Ngabe umnyango wakho uzokwazi yini ukuthi ukwenza kube lula ukuthi abantu bakwazi ukubhalisa kubekhona usizo, njengokuthi amaLungu ePhalamende, amakhosi, noma amakhansela, akwazi ukusiza abantu ukuze bakwazi ukuthi babhaliseke? Ngoba inkinga ukuthi kunabantu abazalelwe ezindaweni ezisemakhaya ezingena lutho. Okungekho sicucu sokuthi wazalwa, kodwa bukhona ubufakazi benzalo, ukuthi uzalwa umabani nobani. Ngiyathokoza.


I will cautiously make a follow-up, Chair.


UNGQONGQOSHE WEZASEKHAYA: Ngiyabonga Lungu eliHloniphekileyo. Yebo, empeleni sesiqalile ukukwenza lokho. Senze amahhovisi angomahamba nendlwana. Siqale eSisonke naseLusikisiki.

Uma ngabe umuntu efika engenasicucu ikakhulu ngoba sithumela omahamba nendlwana ukuzama ukusheshisa. Sesakhe amakomiti nabantu abakhona emphakathini abahloniphekileyo. Ngizokwenzela isibonakaliso nje, elinye ikomiti linabantu ababengothishanhloko asebethathe umhlalaphansi, abafundisi asebathathe umhlalaphansi, nabanye abantu asebathatha umhlala phansi abanesikhathi, ngoba lo mkhankaso sifuna ukuthi usheshe.

Uma siphuma ngalaba omahamba nendlwana, nekomiti liba khona. Esikhundleni sokuthi uma ubhalisa kuthiwe hamba uyolanda lokhu, hamba uyolanda lokhu. Bayanihlola banibuze imibuzo khona lapho, bese kuthathwa isinqumo khona lapho. Ngoba abantu basemphakathini bayabazi abantu bakhona. Bayakwazi ukusheshe bambone nomuntu othi engowakaSithole bese bethi kuye: ooh! unjani Jobe, bese ethe yena hhayi! Jobe mina-Sithole. [Uhleko.] Basheshe bakwazi ukuthi hhayi lona nokho...Ngaleyo ndlela, yinto vele ebesesiyiqalile. Sizoyiqhuba kuzo zonke izindawo, kodwa besisazama ukuthi sibone ukuthi yiziphi izinkinga esizohlangabezana nazo uma siyenza kanje. Kodwa sizokwenza kube lula. Ngiyabonga.

HOUSE CHAIRPERSON (Mr K O Bapela): Thank you, hon Minister.

Agreed to.

Democratic Alliance dissenting.



Vote No 5 – Public Works – put.

Mr F T MASANGO: Chairperson, your department hon Minister has been allocated R150 million for buying houses and offices for the additional new Ministers and Deputy Ministers. Can the Minister tell us how many houses and offices is he going to buy and at what price range is the Minister looking at, especially the houses?

The MINISTER OF PUBLIC WORKS: Chairperson, when you go home at night, hon Masango, you go home to a beautifully renovated house in Acacia Park, nice and comfortable, fully refurbished, public works spend hundreds of millions of rends on Acacia Park. Some of the people on this side of the House don't have a house to go to tonight and they have to go to a hotel.

So, let's get our priorities right. The mandate of the public works is to do exactly that ... [Interjections.] ... to provide official residences for Ministers and Deputy Ministers, like it does for Members of Parliament, so I don't see what the big fuss is. Nobody asked us how much we spent when our houses were renovated in Acacia Park. May be that would be the question we should ask against the hundreds of millions we spend on the three parks, so that we don't distort this issue.

Now, to get back to your question, we are in line with the requirements of the extended Cabinet and we will provide the necessary residences and offices. And we will be accountable to Parliament in the usual manner. Thank you. [Applause.]



Mr P B MNGUNI: Thank you, Chairperson. Minister, R150 million is allocated for offices and residence for the new Ministers. Does this also allow for spending on luxuries, decorations and expensive hotel accommodation for Ministers? In the same vein, Minister, I wanted to comment on the R114,5 million allocated to the Community Works Programme whilst the Ministers are getting R150 million.

The MINISTER OF PUBLIC WORKS: Chairperson, the answer to the first part of the hon member's question is no, the R114,5 million is funds that have been transferred to the Independent Development Trust, IDT, the Community Works Programme and the nonwage portion of the Expanded Public Works Programme.

These figures are available, hon Mnguni, and you know that these presentations were made yesterday in the committee. This is what was announced by the Minister of Finance in the Budget and the Adjustments Estimates actually make it happen. So, if you had listened carefully to the Budget and gone back to read the Minister of Finance's Budget Speech, you would have seen that these figures were there. This is the mechanism to bring the money where it belongs. I thank you.

Agreed to.

Vote No 6 - Government Communications and Information System

Vote No 5 – Public Works

Vote No 6 - Government Communications and Information System – agreed to.

Vote No 7 – National Treasury – agreed to.

Vote No 8 – Public Administration Leadership and Management Academy – agreed to.

Vote No 9 – Public Service and administration – agreed to.

Vote No 10 – Public Service Commission – agreed to.

Vote No 11 – Statistics South Arica – agreed to.

Vote No 12 – Arts and Culture – agreed to.



Vote No 13 – Education – put.

Dr J C KLOPPERS-LOURENS: Chairperson, for the realisation of quality education in our schools we need to recommit ourselves to quality teaching in our classrooms. Mr Minister, how does the highest salary increases translate to improvement in education delivery, and more specifically in the productivity of teachers in their classrooms?

The MINISTER OF BASIC EDUCATION: Chairperson, thank you hon member. I fully agree with you that to get quality education indeed we are reliant on good teachers. For us it is very important to make sure that our teachers are rewarded accordingly, their contributions are recognised, and their conditions of services, which include their salaries, are in order.

The truth of the matter is that, if one looks at the teacher's salaries, including the increment one can see that up to now it is still not where it should be. In terms of the wellbeing of our teachers, we are currently in a bad situation where our teachers cannot even afford a decent house. So, it is important for us that on an ongoing basis we make sure that teachers are given decent salaries so that their living conditions could reflect that of the important profession they fulfil.

We agreed and I think you also agree with me that we have to endeavour at all costs to make sure that we keep on improving their salaries as decent professionals as they are very critical in our society.



Ms F I CHOHAN: Chairperson, with this adjustment government is really and truly putting its money where its mouth is in the sense that education has been the priority. And improving literacy and numeracy is clearly a major priority in this regard.

Five hundred and twenty four million rand will be going towards purchasing workbooks for primary school students that will basically be dealing a death blow to two of the major challenges that we have as far as our education system is concerned.

The first is task on timing, learning and teaching happening in the class. The second, of course is addressing the major challenge regarding some deficiencies amongst our teachers in terms of teaching abilities, and so on. With this in mind, Minister, can you assure the House that workbooks will be on every primary school desk by the beginning of the year in 2010?

The MINISTER OF BASIC EDUCATION: Chairperson, just directly to the question, yes, we are doing all we can to make sure that come the beginning of the year we will have workbooks given to our children. More importantly, one of the key contributory factors in education to improve quality is access to a good textbook.

If you have a good textbook, properly facilitated you can even afford to have poor teachers that we sometimes have. So, a resource book is very crucial and critical to education, and because of its critical nature, we are doing all we can with my colleagues there to make sure that come beginning of the year, first month we have books in front of all the learners.

We are hoping that with the money given to us we will even be able to go beyond the numbers that we thought we could reach. Because our budgets were based on sending money to provinces, but now that we are going to procure centrally with printing centre and distributing centrally we have a sense that we would be able to give it to all the learners. Unlike what we had committed before that we will only give 60% of the learners. With the centralised procurement we might be able to cover all the learners in the system, including kids in Quintile 5.



Mr L S NGONYAMA: Chairperson, the Minister last week reported to the House that outcomes based education, OBE, will be fazed out. Now, we have this R524 adjustment on workbooks, does that include OBE as well, or that is fazed out already?

The MINISTER OF BASIC EDUCATION: Chairperson, I think that is a very useful question because I think we need to clarify things once and for all around where we go so that we don't have comebacks. Hon Members, what informs a curriculum? Let us talk about the curriculum of the country and not even use labels because this OBE becomes a red herring. Each time we want to talk about curriculum people raise OBE.

We are saying in a curriculum a curriculum is informed by principles. The principles and values which are in your Constitution and as a country we had framed them as outcomes, principles of nonracialism, nonsexism, and peace. Those are the principles which were even in your initial curriculum statement that you called OBE. You can't throw away those principles as they continue to inform our curriculum.

What I said last week was that we are within that framework of outcomes or principles that we had termed as outcomes. What we are improving on is resources, reduction of work, and changing the assessment systems. It is important for us that at all times we just talk about the curriculum and not give it labels, because when we label it is when we create confusion to say whether we still have OBE or not.

What we are saying is that we are improving your assessments and resources, so that it could inform the principle. We said we are rewriting the syllabi and therefore bringing textbooks has nothing to do with principles. The textbook is going to support your syllabi or the contents of your curriculum. I think it is quite useful for us to have a common understanding of what we are talking about, because we keep on having people asking us if this is OBE or not. It is neither here nor there.

We are talking about a new curriculum for the country and these workbooks are meant to support that curriculum. When I spoke about the review, I said some of the weaknesses that were picked up by that review committee were poor resources of the curriculum. These textbooks are meant to address that problem of resources of the curriculum. I never said we will not teach children the history of this country. It remains there as it was always there in the old curriculum and it is going to continue to be there so that we teach our children the history of this country.

In the past, we never stopped teaching kids how to multiply. We did it in the old curriculum and we are bringing resources to empower that exercise. The knowledge does not change – we are giving resources to the knowledge part of the curriculum. [Applause.]

Mr A M MPONTSHANE: Chairperson, may I ask a question? [Interjections.] Chairperson, because you have allowed the debate to move further away from the estimates the Ministers now are raising very interesting questions to which we must respond and ask further questions. Are you going to allow more time because we now have ... [Interjections.]

I am addressing the Chairperson and not the hon members... [Interjections.]

The HOUSE CHAIRPERSON (Mr K O Bapela): Just continue, hon member. But, hon Mpontshane, as you are addressing me we are not sure whether you are already asking your question or not, because this is going to eat into your time. [Interjections.]

Mr A M MPONTSHANE: Chairperson, seriously, I am asking you, are you going to allow us more time because ... [Interjections.]

The HOUSE CHAIRPERSON (Mr K O Bapela): No! There was not going to be any allowance of any time.

Agreed to.



Vote No 14 – Health – put.

Mr N SINGH: Chairperson, hon Deputy Minister, many hospitals in our country are in a dismal state and the reason that they are not being refurbished is because there is no money. Could you give reasons why there was a need for a R183 million rollover for the hospital revitalisation grant not spent in the Western Cape and Mpumalanga? Thank you.

The DEPUTY MINISTER OF HEALTH: We have noted amongst other things that the capacity to absorb the money has delayed our ability to transfer to the provinces. The Minister met the MECs recently and together we decided that we shall appoint people with the requested skills so that they are able to receive the money and engaged with the service providers so that the clearance of the funds can proceed without delay.



Mr M WATERS: Chairperson, hon Deputy Minister, in the National Assembly on 21 October 2009 the Minister stated that eight of the nine provinces are likely to run out of antiretrovirals, ARVs, before the end of the financial year. The allocation of R900 million towards the Antiretroviral, ARV, Programme is highly welcomed. We certainly do not want to repeat what happened in the Free State when health services were cut in a moratorium when the new ARV initiation was imposed. Many people on the programme did not receive their ARVs for nearly a month; causing treatment interruptions, possible drug resistance, and increased opportunistic infections.

During this period it is estimated that an additional 30 people per day died in the Free State and that the waiting list trebled to 15 000 people. Will the Minister give this House an assurance that the R900 million allocated, which is R300 million less than what was requested, is sufficient for all provinces to provide ARVs to all those that are currently on the programme and those on the waiting list? I thank you.

The DEPUTY MINISTER OF HEALTH: Chairperson, we requested R1,2 billion and we are grateful for the R900 million that we received. We have secured a balance of R300 from donor funding and, therefore, the whole R2,2 billion, which was based on the careful measurement of the needs in the provinces, will be available and used to clear all backlogs and enrol all needy persons.

We estimate that this will take our coverage to 1 025 million persons, which is more than the 700 000 people that we currently have. We want to give assurance that there shall be no repeat of the problems and tragedies that we saw in the past. Thank you very much.



Mr D A KGANARE: Chairperson, the R1 billion allocated under programme two to strategic health and the additional R30 million for emergency services for the 2010 World Cup does not qualify as unforeseeable and unavoidable expenditure. These were supposed to have been accommodated during the main Budget. Can the Deputy Minister explain why these were not accommodated during the main Budget or does he agree that this is simply poor planning?

The DEPUTY MINISTER OF HEALTH: Chairperson, I thought the Adjustment Budget is not only about unforeseeable and unavoidable. Sometimes one does so much work that extra money is needed to do even more work. So, I want to make a plea that the hon member should read the Adjustment Budget in that context.



Mr E M SULLIMAN: Chairperson, the bulk of the R900 million allocated for the management of the HIV goes towards antiretroviral drugs, I would like to know from the Deputy Minister whether they have any plans to try and procure these antiretroviral drugs at a lower price through, for example, parallel importation. Thank you.

The DEPUTY MINISTER OF HEALTH: Chairperson, the hon Minister Motsoaledi has repeatedly said, in and out of the House, that the challenge that we have now is to cover as many people needing treatment and to have sustainable supplies. He has advised that we look for the most affordable medicines and other possible supplies meaning, locally and internationally. We have not ruled out the possibility of parallel importation; we shall do so with great sensitivity to local economies and the security of jobs. Our priority is to get as much of the treatment as possible at the most affordable price so that we can sustain treatment over as long a period as possible. Thank you very much.

Agreed to.

Congress of the People dissenting.

Vote No 15 – Labour

Vote 14 - Health

Vote No 15 – Labour – agreed to.

Vote No 16 – Social Development – agreed to.

Vote No 17 – Sports and Recreation South Africa – agreed to.

Vote No 18 – Correctional Services – agreed to.



Vote No 19 – Defence and Military Veterans – put.

Mr D J MAYNIER: Chairperson, we have made some very good progress in the Portfolio Committee on Defence and Military Veterans, but four combat readiness briefings have been cancelled by the Ministry of Defence. Will the Minister now commit to give the defence force the green light to brief Parliament on the combat readiness of the SA National Defence Force; because it will only then judge the effect of the Budget on Defence and Military Veterans?

The MINISTER OF DEFENCE AND MILITARY VETERANS: Chairperson, I want to share with the House a bit of intelligence that I got via the grapevine. Apparently, there was a party for the DA yesterday, and awards were given to members of the DA. There was an award for "the most robust Member of Parliament", "the one who sleeps the most on benches", etc. Then, there was one for "guess who will not get a present from the Minister this year?" And you know who got the award? David Maynier. [Laughter.] Congratulations, hon David Maynier.

I would just like to say to the hon Maynier that upon the production by the chairperson of a resolution from the portfolio committee requesting that this briefing be given with the conditions as laid out in our laws I will certainly oblige. I have not received any request from the portfolio committee based on any resolution taken by the portfolio committee; so I have no idea what hon David Maynier is talking about. Thank you.

Agreed to.

Democratic Alliance dissenting.

Vote No 20 – Independent Complaints Directorate - agreed to.

Vote No 21 – Justice and Constitutional Development - agreed to.



Vote No 22 – Police – put.

Ms D KOHLER-BARNARD: Chairperson, I am extremely disappointed in the current governing party, that neither the Minister of Police nor his Deputy has seen fit to be here this evening. Perhaps ... [Interjections.]

The HOUSE CHAIRPERSON (Mr K O Bapela): The Minister of State Security will answer the question.

Ms D KOHLER-BARNARD: Is he going to answer on behalf of the Minister of Police? That's alright. The Director of Priority Crime Investigation head was appointed on the 21 May 2009. Today, nearly six months later, we have seen that they have transferred the money from the Scorpions to the Hawks.

Could whichever Minister, explain if this is merely officialising the agreed transfer and that the money has already been utilised in establishing the Hawks or not? Either way, could he explain to this House why it seems as if many of the ex-Scorpion members who have moved to the Hawks have suffered large pay cuts against all labour legislation and have in many instances stayed for six months with no computers, emails or printers and have been taken off the 639 cases they worked on while in the Scorpions and have instead been scattered around the country to the three existing SAPS units, organised crime, commercial crime and crime intelligence? If those units already existed, what exactly is the Hawks, except a name?

The MINISTER OF STATE SECURITY (on behalf of the Minister of Police): Chairperson, the funny part of it is that while the hon member was sitting here in the House, she has just released a press statement, where she claimed that she had some sources within the police. Our duty is to answer the member's question on whether the directorate for priority crime investigations is functioning.

Yes, it has been established and it is functioning. But some of the facts that you has just said now, are not correct. Firstly, there are not salary reductions for any members who came from Scorpions, as this will constitute a breach of our labour laws. This is a correct statement. In this regard, your sources were incorrect. [Interjections.] [Applause.]

Secondly, you have indicated that some of the former members of the Directorate of Special Operations, DSO, did not have computers. That is not true anymore. However, it is true that there have been some challenges in the beginning of the integration process. It was not caused by any level of inefficiency. Part of the main problem was that the lease for some of the computers coming from the DSO had expired. But the police, particularly the Hawks, moved with speed to ensure that all the members who needed to their work had the necessary equipment. They hired the computers and we are in the process of ensuring that we are purchasing them with these adjustments. That is a fact, and I am sorry for saying that it will be more appropriate that we engage the Ministry other than going through these uninformed information peddlers. I thank you. [Applause.]




Mr V B NDLOVU: Ngiyabonga Sihlalo. Kunemali esuswe kwaDetective yamukiswa kungqalasizinda, ingabe leyo mali izokwenzani? Angizwa!


The HOUSE CHAIRPERSON (Mr K O Bapela): Hon members, I would like to hear the question.


Qhubeka baba.

Mr V B NDLOVU: Kunemali esuswe ngapha ngasekuphenyeni yamukiswa kungqalasizinda, manje ngibuza ukuthi laphaya la iye khona kungqalasizinda iyokwenzani ngoba uphenyo yiwona msebenzi wamaphoyisa nje?


UNGQONGQOSHE WEZOKUVIKELWA KWEZWE (Egameni likaNgqongqoshe Wezamaphoyisa): Kuyiqiniso ukuthi kukhona izimali ezazikhona kulaba ababephethe ezophenyo abangazange bakwazi ukuzisebenzisa ngonyaka odlule. Ingxenye yalezo zimali ithathiwe yafakwa la kungqalasizinda. Ingxenye yaleyo mali ilinganiselwa ku-R93 million. Ilungu elihloniphekile lizokhumbula ukuthi ...


... the Minister has announced that the cluster agreed to move, in order to implement the criminal justice review process. Most of that money will go to the improvement of our systems, particularly, fingerprinting, which is used by the police. The R93 million will be moved for a good course. If the session has not spent the money and we have new priorities which we as government have agreed upon, and have been put and accepted by the portfolio committee, it will be appropriate to move the money to this type of infrastructure. It is currently needed in order to ensure that we increase our capacity to deal with crime. I thank you. [Applause.]



Mr M E GEORGE: Hon Minister, how can protection and security services get an additional R80,7 million when the amount for crime intelligence went down, just before the 2010 World Cup? Secondly, how can detective services be reduced by more than R62 million, notwithstanding the fact that the Hawks will now be incorporated into Programme 3? I thank you.

The MINISTER OF STATE SECURITY (on behalf of the Minister of Police): Chairperson and the hon George, I have just indicated that in as far as some of the these monies which are being moved are concerned, the only money that has been injected into the department is a small amount of about R1 billion, which is dealing with salary increases. The other money is a shift of unspent funds. Those unspent funds are not being moved to reduce the capacity within the police.

In all those units from which the money had been moved, we have ensured that there is continued capacity to do their work. The money unspent is moved to the priority areas which I have identified; as you have indicated, the establishment of the Hawks. We want to ensure that we have these systems, which you said must link with the rest of the criminal justice cluster in order to ensure a coherent approach to fighting crime. I thank you.

Agreed to.

Congress of the People dissenting.

Vote No 23 – Agriculture – agreed to.



Vote No 24 – Communications – put

Mr N J VAN DEN BERG: Chairperson, the SABC is a public and not a state broadcaster. The DA supports Vote No 24 on Communications. The SABC is a public broadcaster with more than 24 million listeners and viewers everyday. The people broadcaster is the only way to be connected to the world. We have agreed that the R200 million should be paid to the SABC to keep its doors open. However, this is not nearly enough to resolve the financial crisis at the SABC. How will the balance of the shortfall be funded to ensure that the SABC remains financially viable? I thank you.

The MINISTER OF COMMUNICATIONS: Hon Chairperson and hon member, we also agree that the SABC is a public broadcaster that needs to be supported. Hence the adjustment of R200 million in order to fund its liquidity, which will be controlled by the Department of Communications on its monthly management accounts. On a monthly basis we will check that it spends the money that has been allocated to it.

No new contracts will be allowed without the Minister's sanction, which are worth more than R1 million. We are appointing a new CEO who has 25 years' experience and an acting CEO. Currently there is no CEO. We are working with the interim board, the task team and the Treasury in ensuring that the money that SABC got through the adjustment is well spent. On the shortfall, the SABC is currently engaging with Treasury, trying to get a government guarantee. [Interjections.]

The HOUSE CHAIRPERSON (Mr K O Bapela): Minister, just ignore the comments.

The MINISTER OF COMMUNICATIONS: The negotiations are going on in order to fund the total shortfall that the SABC is currently experiencing. I thank you. [Applause.]



Ms J D KILIAN: Chairperson, I have a question for the Minister. On the one hand we are giving a R200 million bailout to the SABC to help them overcome the serious financial problems that they are facing. On the other hand, provision is made in the adjustment appropriation for a R4,4 million restraint of trade for the former group CEO. Can the Minister really and morally justify that? I thank you.

The MINISTER OF COMMUNICATIONS: Chairperson and hon member, firstly, let me start by indicating that the negotiations between the former CEO and the board were done without the Minister's involvement, but with his support. When the interim SABC board came into office, we specifically requested that it should begin the stabilisation of the SABC, by among other things, beginning to address the question of a CEO who has been in existence there, and was in dispute with the old board, but being a defector without him doing any work.

The board had the blessing of the Department of Communications to ensure that they should settle with the group CEO as soon as possible. Justification for that was the fact that there was an SABC that had been in limbo for months. Even now, if the interim board had not undertaken the steps and had not settled in the way it did, that situation would still be in existence.

We think that the board should be commended for taking the steps that it took in order to, in the first place, consider the stability of the SABC. Everybody here has praise for the steps that the SABC's interim committee has generally undertaken, ever since its establishment, not long ago. I think it has done well. I thank you.

Agreed to.

Vote No 25 – Environmental Affairs and Tourism – agreed to.

Vote No 26 – Human Settlements – agreed to.

Vote No 27 – Rural Development and Land Reform

Vote No 26 – Human Settlements

Vote No 27 – Rural Development and Land Reform – put.

Mr M M SWATHE: Chairperson, as the Minister is aware, the Department of Rural Development and Land Reform had spent 100% of its current budget. Given that the adjustment is R292 million, mainly for salaries, and that the department has commitments of R3,4 billion in signed contracts with land owners, how will the department finance or honour these commitments under Programme 4: Restitution?

The MINISTER OF RURAL DEVELOPMENT AND LAND REFORM: Hon Chair, what the hon member is saying is not correct. We have spent 100% of the Restitution Budget for this financial year, but not everything. Secondly ... [Interjections.]

HOUSE CHAIRPERSON (Mr K O Bapela): Order, hon members!

The MINISTER OF RURAL DEVELOPMENT AND LAND REFORM: Secondly, hon Chair, we have requested an amount of R220 million. We have reprioritised and discussed this with Treasury. We have agreed that we can reprioritise and make some money available for clearing the signed contracts. So that is what we are going to do. It is therefore not entirely correct to say that we have spent 100% of our Budget. Thank you.



Ms P DE LILLE: Chairperson, I am very happy to hear that there will be money made available for the land claims. I just want to ask the Minister: How long will it take to implement this new system? The hon chairperson of the portfolio committee can confirm that we have received quite a lot of enquiries about outstanding land claims. Will you settle all the old ones before you go over to the new system? Thank you.

The MINISTER OF RURAL DEVELOPMENT AND LAND REFORM: Hon Chair, I am not sure about the new system. Maybe the hon member could explain that and then I can respond. I would like to be pointed in my response.

Ms P DE LILLE: Yes, hon Chairperson. The hon Minister of Finance said earlier on that we cannot continue with this old system of willing buyer, willing seller, in terms of which government needs to pay three times the market value, and we have to look at a new system.

The MINISTER OF RURAL DEVELOPMENT AND LAND REFORM: Fine, Chairperson, now I understand. Hon Chair, the willing buyer, willing seller model is government policy, as we speak. It is under review. We are going to present to this House, next year, a Green Paper for discussion. We have already developed the framework, and we are busy developing that ourselves. We want to present to government a proposal as to how we go about changing that. Secondly, because it involves a lot of people, we are also consulting with the people who are affected by this. People have been working on the policy, and they have been planning according to that. So we can't say today that on date x this is what we are going to do, but certainly, I can imagine that hon members will participate in this Green Paper and we expect that they will assist us in finding a much fairer solution than the willing buyer, willing seller model that we have today.



Mr T BOTHA: Chair, hon Minister, given that failure urgently to address the issue of land redistribution and restitution is a potential time bomb, and given the sensitivity and importance of land redistribution in this country for the stability of the country, can the hon Minister explain the decrease in the allocation of funds to land reform grants under Programme 5, and the impact thereof on land restitution goals?

The MINISTER OF RURAL DEVELOPMENT AND LAND REFORM: Thank you, hon Chair. I imagine that the hon member is referring to Subprogramme 5.05. We are faced with a challenge in rural development. The challenge that hon members keep raising, as the hon Swathe and the hon De Lille have done now, is indeed a challenge. Now, we have had to reprioritise. I think that is really what I have been referring to. We have had to reprioritise, in order for us to be able to clear the desk.

The challenge is this: Once you have signed the settlement agreement, what will happen is, if you don't pay, the costs will escalate, because you will have to pay interest. A complicating factor is that some people have gone to court. The department has been taken to court. As we speak, there are cases that are before the court. There are two types of cases. In one the matter might be settled in court today and we might be called on to pay today – those cases amount to R377 million, as we speak. We don't have that money. The other type of case that is before the court are those where the court might say, you have agreed, settle. In other words, it is a performance issue – and these cases amount to R202 million.

Now, once the court takes a decision, we have to comply with that. We have had to position ourselves in order to be able to meet that challenge when it comes about. It is not something that we like, but it is something that we have to do, given the constraints that we are faced with right now. Thank you, hon Chair.



Mr P S SIZANI: Chair, seeing that R250 million in the Additional Appropriation has been earmarked for the new Comprehensive Rural Development Programme of the new department, can the Minister tell us whether this money will target poverty and unemployment in the rural areas, and in what way will the Ministry be able to deal with the poverty that we are experiencing in those areas?

The MINISTER OF RURAL DEVELOPMENT AND LAND REFORM: Hon Chair, the hon Swathe has referred to this amount of money, and has said that it would mainly go to salaries. Actually, we got R289 million, I think. Of that R289 million, R250 million will go to service delivery. That is what the hon chair of the portfolio committee is asking. I am happy that he has asked this question, so that I can explain the points further.

Now, of the R250 million that he has referred to here, R90 million will go to fencing for ploughing and grazing land across the country, or rather, in the nine provinces. So that is service delivery, in our view, and, in agreement with the provinces, that money will be used to create jobs. But there will also be an element of quality control, for which we have an agreement with the Ministry of Public Works, so that we can make use of the Independent Development Trust. Of course, in Mpumalanga we are using their trust. There is a trading trust in Mpumalanga, where we have already provided, between August and now, 260km of fence. In KwaZulu-Natal we are using Ithala. So we are creating jobs through that. In the Eastern Cape we are negotiating to use Asgisa EC to ensure that the quality of the fence that we are erecting is good. So this is what is going to happen all over the place in terms of that.

With regard to the remaining R160 million, we are working with Fort Hare University, which is helping us in doing other things. Amongst other things, we want to develop an agripark, particularly in Mpumalanga, because there is plenty of water in Mpumalanga. We have discussed the possibility of getting land there with the Premier a couple of weeks ago. We will get land, actually, to create an irrigation facility, and then we can start producing vegetables there. But we also want to encourage, with that same money, food gardens, so that people can sell there. We want to create a market through the agripark, as well as a processing plant, so that we can process vegetables into vegetable soup. So we are going to create social infrastructure.

We are also intervening in health facilities. If we get to a rural area where there are no clinics, or the mobile clinics come once a week or so, or don't come as often as they should, this relates to the problem of the roads infrastructure. We are intervening there. So that money is going to go to food gardens, to roads, to fencing gardens - because this we must do - and to water.

The hon Minister for Agriculture has really done government a lot of good. Consider, for example, the refining of water in places such as Masha, where you have water constraints, not just because water is scarce, but because of the quality of the water. So the Minister has come in, but the Minister of Communications has come in also in terms of e-centres to follow. The Minister of Energy is coming in for electrification in all these places. So we are not working in terms of creating this infrastructure ourselves. We create opportunities for other departments to come in and do the work themselves.

The R160 million will certainly be spread a little wider than the one place, that is Masha, but across the provinces. Also, we will initiate, and the other departments will come in and complete the job, whether it concerns health facilities, or schools, or other things. We will do that in Mpumalanga, because the Department of Education may not be ready yet, but we are ready to assist there in Mpumalanga. There is one school where children from seven grades have to study in one room, and we have to intervene there.

So the money is not going to go to salaries. It is not correct to say so. Thank you. [Applause.]

Agreed to.

Congress of the People dissenting.

Vote No 28 – Minerals and Energy – agreed to.

Vote No 29 – Co-operative Governance and Traditional Affairs


Vote No 29 – Co-operative Governance and Traditional Affairs – put.

Mr P F SMITH: Chairperson, Minister with regard to this nice booklet, here, the Treasury Regulation System specifies that unforeseeable and unavoidable expenditure excludes the following two things: Firstly, spending increase is due to tariff adjustments and price increases. Secondly, spending to extend existing services beyond the unforeseeable; unforeseen. Now, in your budget, there is an amount of R509 million under unforeseeable and unavoidable expenditure allocated for increase cost or to provide free basic electricity. Presumably, that's impossible because of tariff increases; and the other explanation would be, presumably, the roll-out which is beyond expectations. It's hard to believe it since there is a service delivery crisis which makes it difficult to believe that there has been such a heavy success. What is the R 109 million for, if it's not for those two issues? And how are our municipalities compensated for tariff increases by Eskom? Thank you.

The MINISTER OF CO-OPERATIVE GOVERNANCE AND TRADITIONAL AFFAIRS: Chairperson, it's quite interesting to hear member Smith trying to describe the situation in municipalities as if it's a crisis. In relation to the issues that are there, for all intents and purposes, he's misinterpreting it. There is no doubt that challenges are there, but they are not a crisis. This is the misrepresentation of facts; in fact, that statement is bordering on misleading the House.

Responding on the issue of what will happen to the money and how to ensure that we compensate the increases; I think hon Smith has answered his own question, that the amount of over R500 million is aimed at ensuring that it assists the poor in relation to the forthcoming tariff increases. Therefore, it is a matter that has been taken care of.

The second matter is an issue around the increase of R900 million which is dealing with supporting the poor in relation to tariff increases. The situation, Mr Smith, in municipalities is that they are undergoing a turn-around process; there is no crisis. Don't describe it the way you do. Those are challenges that are within our power to be addressed.

Mr P F SMITH: I have a follow-up ...



Mr W P DOMAN: Chairperson, hon Minister, you are asking us to vote for R288 million of rollover funds for the infrastructure ground programme; my question is how are you and you department going to ensure that this money is spent, not on running costs by municipalities, but on infrastructure and if this illegal practice, which we heard of from the Minister of Finance, occurs, will you take steps?

The MINISTER OF CO-OPERATIVE GOVERNANCE AND TRADITIONAL AFFAIRS: Chairperson, there are lot of things to consider when talking about the Municipal Infrastructure Grant, MIG; it is not an accurate answer. One of the issues is that most of these municipalities with these challenges do not have the capacity to deliver. As the department, both provincially and nationally, we are intervening to ensure that the money is well spent.

We are also exploring other measures, because in the past the department had a Municipal Infrastructure Investment Unit which was a structure aimed at ensuring that infrastructure is rolled out in municipalities as expected by the national department. The unit was abolished, but we are looking for other possibilities of reviving it. We have realised that MIG cannot be in a position to deal with the challenges prevailing in municipalities; we are therefore looking at the possibility of a special purpose vehicle which will be able to roll out infrastructure.

We have quantified everything across the country and these issues will be taken up. As an interim measure, the department is ready to ensuring that it assists municipalities with this issue and see to it that they never occur again. Thank you very much.

Agreed to.

Vote No 30 – Public Enterprises – agreed to.

Vote No 31 – Science and Technology – agreed to.

Vote No 32 – Trade and Industry – agreed to.


Vote No 32 – Trade and Industry

Vote No 33 – Transport – put.

Mr M S F DE FREITAS: Hon Minister, with regards to the additional R116 million payment for the transport disaster management grant for the rehabilitation of infrastructure destroyed by flooding in the Western Cape in 2008, considering that this was a natural disaster, and was declared so, should this amount not be paid from the disaster fund?

The MINISTER OF TRANSPORT: Chairperson, yes the money for this disaster does come from Transport, unless there is other contingency funding elsewhere. Once there is a disaster, everybody looks at Transport. For instance, if a road is damaged or a bridge is broken during a disaster, we can reclaim whatever money is available elsewhere. As Transport, we only move in as an emergency measure. I thank you.

Mr M S F DE FREITAS: Hon Minister with regards to Programme 6 for an additional R144 million allocated as a transfer payment for the Gautrain Rapid Rail link grant for inflation and foreign exchange adjustments, why were these costs not factored in to the initial contracts under condition of contract price adjustments?

The MINISTER OF TRANSPORT: In terms of the contract, if the amount was factored in or there was escalation in terms of inflation, we are liable for paying. That is what we are doing.

Mr M S F DE FREITAS: I am sorry, Chairperson. This is the last one. My question is with regards to the departmental revenue of R198 million from transaction fees for vehicle registrations that will be used for the maintenance of the Electronic National Transport Information System, commonly known as Enatis. Originally, this fee was paid to Treasury to offset their extra cost for the system. Why was this amount not paid to the Department of Transport instead? I thank you.

The MINISTER OF TRANSPORT: As the member is aware, we have introduced the Road Traffic Management Corporation, RTMC. In order for it to function, this amount had to be allocated so that we can be able to implement our RTMC and be able to go out on the road safety campaign properly, particularly the demerit system that we will be introducing next year. All that will depend on the proper functioning of the RTMC. [Applause.]

Agreed to.

Vote No 34 – Water Affairs and Forestry – agreed to.

ote No 35 – Agriculture, Forestry and Fisheries

Vote No 34 – Water Affairs and Forestry

Vote No 35 – Agriculture, Forestry and Fisheries – put.

Mr L L BOSMAN: Chairperson, hon Minster, under Programme No 3, Agricultural Support Services, a provision was made for an agricultural disaster management grant of R156,9 million to provide for disaster management in all nine provinces. In the Government Gazette of 8 September 2009, a declaration of the provincial state of drought disaster in the Eastern Cape province, six district municipalities were declared as disaster areas. The assessment report estimated a damage of R1,184 billion.

This is only one of a number of drought disaster areas with a possible total damage, much higher than this figure. How does the Minister plan to assist communities who suffered losses or are in need of water with financial support, in the view of the limited budget provided in this programme, and at what time frames? I thank you.

The MINISTER OF AGRICULTURE, FORESTRY AND FISHERIES: Chairperson and hon member, the state cannot be an insurance policy broker for farmers. The state cannot substitute insurances for farmers. Our first prerogative is to get farmers to take out insurance policies so that they cannot be totally dependent on the state disaster management.

Where disaster does occur, it is not incumbent on the state to recoup farmers' losses. Ours is not to balance out the losses. In any business you will have losses and you must ensure that you actually make provision for them. As in the past, you cannot be totally dependent on the state to pay for all your losses, particularly when it comes to disasters.

With disaster management, we only refund farmers on production costs and infrastructure costs on farm settlement disaster management. When it comes to all farm disaster management, for example, roads and other infrastructure projects, we are dependant on the other line function departments, like the Department of Transport and the Department of Human Settlements to assist in other areas where there would be disasters.

Our intention is not for agriculture to cover the entire disaster, but only some areas. I thank you. [Applause.]

Mr L L BOSMAN: Hon Minister, yes I agree with you that there should be schemes available that must also be assisted by government. But I just want to point out that I specifically asked this question in the Eastern Cape because it were not only farmers who were involved in the disaster areas, but even the community and poor people who don't have water or resources to recuperate their lands and so on.

I think this is the list that government can do something about, to look after these people, because they are poor and resource poor. I thank you.

The MINISTER OF AGRICULTURE, FORESTRY AND FISHERIES: Hon Chairperson, in my response I did not refer to any particular group. To me farmers are, emerging, smaller, older, medium or commercial farmers. They are all treated equally when it comes to disaster management.

In the Eastern Cape, yes, there were six districts declared disaster areas. Agriculture does not fund anything like roads and housing. Those areas where affected in more areas than only agriculture. We only support agriculture-related projects. In the Eastern Cape, we disaggregated the expense and are convinced that what we are going to refund to those communities, which are agriculture-related, will be within our budget. I thank you. [Applause.]

Agreed to.

The HOUSE CHAIRPERSON (Mr K O Bapela): Hon M N Magazi. I thought maybe you have pressed the button. Please don't play with the buttons then. Stay away from them. I thank you. [Interjections.] It is on the screen, so I am not just accusing you.

Vote No 43 – Water Affairs – agreed to.

Schedule agreed to.

Voting on Schedules

Vote No 43 – Water Affairs

Voting on Schedules.

Vote No 1 – Presidency – agreed to.

Democratic Alliance and Congress of the People dissenting.

Vote No 2 – Parliament – agreed to.

Vote No 3 – International Relations and Co-operation – agreed to.

Vote No 4 – Home Affairs – agreed to.

Democratic Alliance dissenting.

Vote No 5 – Public Works – agreed to.

Vote No 6 – Government Communications and Information System – agreed to

Vote No 7 – National Treasury – agreed to.

Vote No 8 – Public Administration Leadership and Management Academy – agreed to.

Vote No 9 – Public Service and Administration – agreed to.

Vote No 10 – Public Service Commission – agreed to.

Vote No 11 – Statistics South Africa – agreed to.

Vote No 12 – Arts and Culture – agreed to.

Vote No 13 – Education – agreed to.

Vote No 14 – Health – agreed to.

Congress of the people dissenting.

Vote No 15 – Labour – agreed to.

Vote No 16 – Social Development – agreed to.

Vote No 17 – Sport and Recreation South Africa – agreed to.

Vote No 18 – Correctional Services – agreed to.

Vote No 19 – Defence and Military Veterans – agreed to.

Democratic Alliance dissenting.

Vote No 20 – Independent Complaints Directorate – agreed to.

Vote No 21 – Justice and Constitutional Development – agreed to.

Vote No 22 – Police – agreed to.

Congress of the people dissenting.

Vote No 23 – Agriculture – agreed to.

Vote No 24 – Communications – agreed to.

Vote No 25 – Environmental Affairs and Tourism – agreed to.

Vote No 26 – Human Settlement – agreed to.

Vote No 27 – Rural Development and Land Reform – agreed to.

Congress of the people dissenting.

Vote No 28 – Minerals and Energy – agreed to.

Vote No 29 – Co-operative Governance and Traditional Affairs – agreed to.

Vote No 30 – Public Enterprises – agreed to.

Vote No 31 – Science and Technology – agreed to.

Vote No 32 – Trade and Industry – agreed to.

Vote No 33 – Transport – agreed to.

Vote No 34 – Water Affairs and Forestry – agreed to.

Vote No 35 – Agriculture, Forestry and Fisheries – agreed to.

Vote No 43 – Water Affairs – agreed to.

Schedule agreed to.




(Second Reading debate)

There was no debate.

Bill read a second time.

The House adjourned at 20:17.


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