National Assembly - 01 March 2001
THURSDAY, 1 MARCH 2001 __
PROCEEDINGS OF THE NATIONAL ASSEMBLY
____
The House met at 14:03.
The Speaker took the Chair and requested members to observe a moment of silence for prayers or meditation.
ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS - see col 000.
NOTICES OF MOTION
Mrs M A A NJOBE: Madam Speaker, I give notice that on the next sitting day of the House I shall move:
That the House -
(1) notes that -
(a) baby Rosita celebrated her first birthday; and
(b) baby Rosita was rescued by the SANDF after her mother gave birth
to her in a tree in the flood-stricken countryside of
Mozambique; and
(2) wishes baby Rosita a happy birthday.
Mr J SELFE: Madam Speaker, I give notice that on the next sitting day of the House I shall move:
That the House -
(1) notes -
(a) the outstanding and splendid victory of the DA in the municipal
by-election in Mitchells Plain yesterday, in which the DA
received nearly 80% of the vote, and the crushing and
humiliating defeat of the ANC, which received less than 15% of
the vote ...
[Interjections.]
(b) the performance in Secunda, where the DA increased its support
by almost 13% while support for the ANC dropped by 7%;
(2) congratulates the DA on its performance in Khutsong and Sherwood, where the DA showed good growth in ANC-held wards; and
(3) accepts that the DA’s performance must be ascribed to inspiring leadership and its commitment to delivery for all the people of South Africa.
[Applause.]
Dr R RABINOWITZ: Madam Speaker, I give notice that on the next sitting day of the House I shall move on behalf of the IFP:
That the House -
(1) commends the Speaker on introducing the members of the health committee to Dion von Tonder, the courageous young cyclist who, sponsored by Liberty Life, is travelling through the country, highlighting Aids awareness at schools and colleges;
(2) requests all Ministers who play a role in Aids prevention and treatment to take note of his wise injunction to promote openness by -
(a) offering incentives in the form of lifestyle support programmes;
(b) promoting a culture of discipline among youth; and
(c) increasing access for the vast majority of people to free HIV
testing; and
(3) establish more partnerships with the private sector and the international community to enhance awareness in novel and practical ways.
Mr P J GOMOMO: Madam Speaker, I give notice that on the next sitting day of the House I shall move on behalf of the ANC:
That the House -
(1) notes that -
(a) today marks the 15th anniversary of the assassination of the
former Swedish Prime Minister and founder member of Socialist
International, Mr Olof Palme;
(b) Mr Olof Palme stood for international peace, justice, equality
and solidarity;
(2) acknowledges the role he played in isolating the apartheid regime and supporting the struggle for the liberation of the people of South Africa;
(3) joins the people of Sweden in commemorating this martyr and vows to fight for the ideas he lived and died for;
(4) declares: ``Long live, the memory of Olof Palme!’’
Mr C M MORKEL: Madam Speaker, I give notice that on the next sitting day of the House I shall move: That the House -
(1) notes with shock the ANC’s display of political intolerance in the Langa and Crossroads areas against members of the DA who are actively working and winning support in these areas …
[Interjections.]
(2) expresses outrage at the behaviour of ANC city councillors and members of the ANC who threaten and intimidate DA members and office- bearers in these areas;
(3) accepts that the ANC does not hold any historical claim to or ownership of these areas and that other parties whom voters trust have an equal right to work and campaign in these areas; and
(4) calls on the ANC and its members to undertake that it will refrain from political intolerance and that it will respect the basic principles of democracy and the Constitution of the Republic of South Africa.
[Interjections.]
Ms ANNELIZé VAN WYK: Madam Speaker, I give notice that on the next sitting day of the House I shall move on behalf of the UDM:
That the House -
(1) notes the courage displayed by a foreign tourist who was recently a victim of gang rape in Hermanus;
(2) commends her on her willingness to come back to South Africa to testify, in order to see that justice is done and that the rapists are removed from society;
(3) acknowledges that through her brave action she is contributing positively towards the fight against crime and preventing more women from being raped by these criminals;
(4) commends the Department of Safety and Security for budgeting in such a way that those crimes committed against women and children remain a key priority for the SA Police Service; and (5) calls on the Minister for Justice and Constitutional Development and the Department of Justice to improve on their role in the criminal justice system and to ensure a higher conviction rate of the perpetrators of these crimes against humanity.
Mr B MTHEMBU: Madam Speaker, I give notice that on the next sitting day of the House I shall move on behalf of the ANC:
That the House -
(1) notes that -
(a) the DP and New NP walked out of the Scopa meeting yesterday
because of their failure to understand and abide by the Rules of
Parliament, which were adopted by this House; and
(b) Rule 137(4) does not allow for a minority report to be brought
out by any committee of Parliament; and
(2) expresses grave concern and alarm that the DP and New NP use silly misinterpretations for political mileage, at the expense of the integrity of Parliament.
[Applause.]
Mr G E BALOI: Madam Speaker, I give notice that on the next sitting day of the House I shall move on behalf of the UCDP:
That the House notes that -
(1) the Reserve Bank governor, Tito Mboweni, said yesterday that the political turmoil in neighbouring Zimbabwe was still affecting South Africa’s economy through its adverse impact on investor sentiment;
(2) Mr Mboweni further told foreign journalists that he hoped the coming visit by President Mbeki to Zimbabwe would help stabilise the situation; and
(3) the governor also said he was not unduly concerned about the recent rise in the inflation rate from 7,6% to 7,7% and that indications were that the inflation target of between 3% and 6% for the next year would be met.
Mr S A MSHUDULU: Madam Speaker, I give notice that on the next sitting day of the House I shall move on behalf of the ANC:
That the House -
(1) notes that the Department of Labour and the National Skills Authority have successfully launched our Vhutsila National Skills Development Strategy on 22 February at Gallagher Estate;
(2) recognises that all Nedlac social partners support this initiative in line with their commitment to a skilled and productive economy with a highly skilled workforce; and
(3) commends the Minister of Labour for his commitment to a skills revolution, being instrumental in developing a culture of high quality and lifelong learning which will support the formal economy, while stimulating the development of small business, addressing inequality and assisting new entrants to the economy.
Ms R TALJAARD: Madam Speaker, I give notice that on the next sitting day of the House I shall move:
That the House -
(1) notes that -
(a) ministerial involvement in the pre-plenary activities kof the
Standing Committee on Public Accounts (Scopa) poisons the
constitutional separation of powers and compromises important
sections of the Constitution ...
[Interjections.]
(b) Scopa was muscled into rubberstamping the executive's decision
to exclude the Special Investigating Unit (SIU) from the arms
probe in its first vote in nearly eight years - compromising
section 55(2)(b) of the Constitution; and
(c) the Nel Committee failed to sanction Minister Penuell Maduna for
violating the Constitution; and
(2) expresses its concern at -
(a) the flagrant disregard for the Constitution; and
(b) the erosion of Parliament's oversight and accountability
functions by means of a party-political power grab by the
governing party, despite section 57(2)(b) of the Constitution.
[Applause.]
Mr M A MZIZI: Madam Speaker, I give notice that on the next sitting day of the House I shall move on behalf of the IFP:
That the House -
(1) notes that there are many imperatives requiring the SA Police Service to win full public support and acceptance;
(2) expects and the country demands that police personnel are well trained and ready for every eventuality;
(3) nevertheless expresses its criticism at the way in which a valuable and necessary training exercise at Wonderboom Airport was allowed to become a total debacle of claims and counterclaims and denials; and
(4) therefore calls on the Minister to examine what could be done to achieve greater finesse in handling public communication and keeping public trust.
Ms N S MTSWENI: Madam Speaker, I give notice that on the next sitting day of the House I shall move on behalf of the ANC:
That the House -
(1) notes that the Human Rights Watch has commended the work done by the Human Rights Commission;
(2) believes that this positive response confirms that the Government and the people of South Africa are on the right track in building a culture of human rights; and
(3) calls on the Human Rights Commission to continue with its important work of ensuring that human rights are upheld in our country.
[Applause.]
Adv A H GAUM: Madam Speaker, I give notice that on the next sitting day of the House I shall move:
That the House -
(1) notes that the ANC’s Umlazi subregion called a public demonstration to take place at the Mangosuthu Technikon, which would have resulted in the disruption of the campus and incited violence …
[Interjections.]
(2) further notes that the DA made an urgent appeal to Minister Kader Asmal to use his influence to prevent this demonstration from taking place and the ANC from politicising and destabilising the situation on campus;
(3) acknowledges that due to this intervention, the demonstration did not take place, but that a few ANC members entered the campus with flags;
(4) expresses its gratitude to the DA and the Minister for preventing a catastrophe from happening; and
(5) calls on the ANC to discipline their undisciplined cadres who acted irresponsibly.
[Interjections.] [Applause.]
Mr L C MOTHIBA: Madam Speaker, I give notice that on the next sitting day of the House I shall move on behalf of the UDM:
That the House -
(1) notes with disgust and dismay the controversy and confusion caused by the Northern Province government amongst traditional leaders in that province concerning their participation in the municipal councils;
(2) abhors with contempt the actions of the MEC for local government and housing and the MEC in the office of the premier to entice traditional leaders with big salaries as a condition for their participation in the municipal councils;
(3) condemns the actions of the Northern Province government of nicodemously issuing letters of appointment confirming participation of some traditional leaders in the municipal councils behind the back of Contralesa;
(4) considers the actions of the Northern Province government as a deliberate and continuous attempt to deprive traditional leaders of their legitimate powers and functions …
[Interjections.]
The SPEAKER: Order! Hon member, your time has expired. Hon members, there is too much noise, too much movement and far too many private meetings going on!
Mrs D G NHLENGETHWA: Madam Speaker, I give notice that on the next sitting day of the House I shall move on behalf of the ANC:
That the House -
(1) notes the ``Saamtrek: Values, Education and Democracy in the 21st Century’’ conference which was held in Kirstenbosch under the auspices of the Department of Education;
(2) further notes that this conference called for a policy to introduce African languages in schools, the setting up of units to deal with racism and the convening of a national conference on HIV/Aids and sex education;
(3) believes that this conference was of historic significance in that it passed resolutions that will accelerate education transformation; and (4) commends the education department for having organised this conference and calls on the Minister to ensure that the resolutions of this conference are implemented.
[Applause.]
FIRE ON TABLE MOUNTAIN
(Draft Resolution)
Mnr C H F GREYLING: Mevrou die Speaker, ek stel sonder kennisgewing voor:
Dat die Huis-
(1) kennis neem van die verwoestende brand gister teen die hange van Tafelberg wat in bloedige hitte deur helikopters, bosbouspanne en brandweerpersoneel onder beheer gebring is; en
(2) verder kennis neem van soortgelyke brande wat vroeër in die Wolseley omgewing deur gesamentlike brandbestrydingsoperasies geblus is; (3) dank betuig aan alle individue wat in lewensgevaarlike omstandighede help om brande te bestry; en
(4) hulde bring aan diegene wat met hulle lewens boet in die uitvoering van hul belangrike pligte;
(5) aanvaar dat die droogte in die Wes-Kaap ‘n bydraende faktor is; en
(6) daarom ‘n beroep op die regering doen om alles in sy vermoë te doen om sulke brande te voorkom en te bestry.
[Applous.] (Translation of Afrikaans draft resolution follows.)
[Mr C H F GREYLING: Madam Speaker, I move without notice:
That the House -
(1) notes the devastating fire against the slopes of Table Mountain that was brought under control in extreme heat yesterday, with the aid of helicopters, by forestry teams and personnel from the fire department;
(2) further notes that earlier similar fires in the vicinity of Wolseley were extinguished through joint fire-fighting operations;
(3) expresses its gratitude to all individuals who help to fight fires in life-threatening circumstances;
(4) pays tribute to those who have lost their lives in the execution of their important duties; and
(5) accepts that the drought in the Western Cape is a contributing factor to these fires; and therefore calls on the Government to do everything in its power to prevent and fight such fires.
[Applause.]]
Agreed to.
EXTENSION OF TRIAL-RUN PERIOD OF QUESTIONS FOR ORAL REPLY
(Draft Resolution)
The CHIEF WHIP OF THE MAJORITY PARTY: Madam Speaker, I move the draft resolution printed in my name on the Order Paper, as follows:
That, with reference to the resolution adopted by the House on 13 February 2001, the period for the trial run of questions for oral reply be further extended until 6 April 2001.
Mr M J ELLIS: Madam Speaker, the DP will not be supporting this particular motion.
An HON MEMBER: Why?
Mr M J ELLIS: It is, of course, a year ago that the new system of questions came into being as a trial run under the set of trial rules. That trial run has been extended several times now. We made it clear last year that we would not be party to ongoing extensions, and by voting against this extension this afternoon, it gives us the opportunity to express our concern over the way the entire matter has been handled. It also gives us a chance to show again that we do not support the trial rules. We believe that voting continually in favour of the extension of these trial rules creates the impression that we may be in support of these trial rules, and we want to avoid this - I direct this to Mr Momberg - at all costs.
Whenever the issue of question time has been raised at either the Chief Whips’ forum, the subcommittee formed by that forum or in Parliament itself, we have always made the point that we are opposed to this change in Rules, and that the new system is boring, unwieldy, cumbersome and expensive. It does not work as a free-flowing exchange of information that question time in Parliament should be.
Part of the problem is that Ministers have not co-operated properly, leading to an enormous backlog in questions that simply have not been answered. The ANC knows this as well as I do. Furthermore, we have pointed out time and again that the system of clustering Ministers simply has not worked. After all, the purpose of question time in Parliament is that it creates an opportunity for MPs to put questions to Ministers, in order for them to obtain information on matters relating to their portfolios, their constituencies or to matters of national importance.
When one is able to ask questions of Ministers only once every three weeks because of the cluster system - quite frankly, it often works out that it is once every four or five weeks only, because Ministers do not turn up - that free flow of information dries up and question time becomes little more than a ritual. Add to this the fact that all too often Ministers do not appear on their cluster days, and it is clear that question time has become somewhat farcical.
Now, we have appealed, time and again, for the old Rules to be brought back while a new system is properly, constructively and conclusively thought through and made ready for application. But, quite frankly, we have been ignored by the ANC and certain gentlemen sitting there.
Mr J H MOMBERG: You never said so.
Mr M J ELLIS: We have said it a hundred times and Mr Momberg knows it. [Interjections.] So the DP and the DA do not support this trial system. We have, as I said, made this clear time and again. [Interjections.] We did so at a meeting of the subcommittee on Tuesday evening this week, both in writing and verbally, and Mr Momberg knows that that is true. [Interjections.]
In return the ANC have made it clear - and this is an important point - that they will change the Rules of Parliament and make these trial rules permanent even if they have to use their majority to do so. [Interjections.] Mr Momberg has certainly said that often enough. [Interjections.] This, of course, is typical of what is happening in Parliament: the way the ANC has used its majority in Scopa, its handling of the Maduna committee, and, in general, the way it is just turning the legislature into a body without bite and very little bark, totally subservient to the executive. That is what the ANC is doing to this Parliament. [Interjections.]
As a result of this, we have been left with little option but reluctantly to agree to participate in a process … [Interjections.] I want Mr Momberg to listen. We have reluctantly agreed to participate in a process of trying to make these rules better in the interests of both Parliament and individual MPs. This is what we agreed to do on Tuesday evening. We agreed that this could be achieved by the end of March, if we all applied our minds. [Interjections.] This is what we agreed to. It is, of course, an enormous concern that this process that we have now agreed to was not undertaken a month ago so that the trial rules would not have to be extended today.
Let me make it clear to the ANC that the DP has not reneged on its agreement on Tuesday evening despite what the hon Mr Momberg says. We will participate fully and constructively in doing everything we can to improve the trial rules, because they are so bad and we recognise the fact that they need to be improved. [Interjections.] We will do so in the interests of our members and members of Parliament in general. Neither are we reneging on our promise last year that we would not support continual extensions of these trial rules.[Interjections.]
How else, Madam Speaker and Mr Momberg, do we show the ANC that we mean what we say? [Interjections.] They certainly do not listen. Mr Momberg, certainly, as part of the ANC, never means what he says. [Applause.]
Mr A M MPONTSHANE: Madam Speaker, Deputy President, hon members, let me state our case as we understand it. We understand that the system is on trial and that all parties, including the IFP, have something against the new system as we are using it. We also have something in favour of the system, but, as we understand it, the debate today is not about the merits or the demerits of the system. It is about the extension of the trial-run of this system. On this score, I just want to submit that we want to postpone our judgment against the defendant. When the time comes to pass judgment we will do so, so we support the motion. [Applause.]
Mr T ABRAHAMS: Madam Speaker, after having been installed as MPs, the UDM members were keen to pose questions to the Ministers, for both written and oral reply. Very soon, however, members noticed that the Rules simply did not work in a way that allowed for their questions to receive attention.
Similarly, the allocation of opportunities for the UDM members to make use of interpellations was suspect. While each of the three largest parties had an interpellation slot every single Wednesday, the UDM had to share one slot with nine other parties. Over a period of six months, it had only two opportunities for interpellations.
Clearly the system had to be overhauled, and a subcommittee was appointed to make recommendations. An important decision was taken by this subcommittee, which was briefed to recommend the changes. Rather than recommend changes to the Rules and then let it run, it was recommended instead that any changed system be given a trial run. The trial run, which has been extended twice before, has to be extended further because the proposed system has proved to have drawbacks. These drawbacks must receive further attention from the subcommittee.
In essence, the subcommittee is asking for more time. We have no problem with this and I am so glad that Mr Momberg agrees with us. We will be supporting the further extension of this trial run. [Applause.]
Ms C DUDLEY: Madam Speaker, the ACDP is in agreement with this motion as we believe that although the interim question procedure should be made permanent, the flaws in the system must be identified and rectified before the new system is drafted into the Rules. The main issue for the ACDP is that questions must be answered. We are not in favour of questions falling away or being held over. The time period of four weeks for questions to be answered seems to us to be reasonable.
We agree that questions on the Order Paper should be limited and that excess questions should be treated as written questions. But we would not like to see the questions appearing on the Order Paper being limited to under 50. We are in favour of the proposal that the order in which parties pose questions to Ministers should not start from scratch each question day, but should run on in clusters as is done with questions to the President and Deputy President. Very importantly, we propose that parties be allowed to precede questions with a comment, to enable a political statement to be made on follow-up questions.
Unlike the DA, we believe that this system can work to facilitate a multiparty democracy and it is our experience that question time has, in fact, improved in contrast to the previous process. [Applause.]
Mrs P DE LILLE: Madam Speaker, I want to agree with my colleague from the IFP that we are not discussing the merits of the system today but the extension. Because Mr Momberg has been so good to the opposition parties, we want to support him. We support the extension. [Applause.]
Miss S RAJBALLY: Madam Speaker, the trial period of questions in the House has proved that there has been participation and interaction with Ministers. It has given smaller parties an opportunity to ask supplementary questions.
I do agree that there have been delays in the questions and answers, but we have to give it another trial. Therefore, the request for the extension of the present trial-run period is most welcome and supported by the MF. [Applause.]
Mnr C AUCAMP: Mevrou die Speaker, dit breek my hart, maar in hierdie debat moet ek teen wil en dank die ANC ondersteun. [Applous.] Die AEB hou nogal van die huidige formaat van vrae en opvolgvrae. Deelname deur alle partye word hierdeur verbeter. Ek weet daar is klagtes dat lede hande opsteek, maar nie raakgesien word nie. Hulle moet maar wakker wees: ``If you snooze, you lose.’’
Ons is in Suid-Afrika ‘n multipartydemokrasie en nie ‘n tweepartydemokrasie nie en die feit dat elke stem hier gehoor word, dra by om die waarde van hierdie instelling te verhoog. Hierdie voorstel vra bloot vir ‘n uitstel van die datum van beslissing tot 6 April. Ons het nie die DP se voorstel gehoor nie en daarom kan ons nie op hierdie stadium enige steun gee om vandag dringend te besluit nie. As ons nou al vyf jaar lank wag vir ‘n artikel 185-kommissie, dan is ‘n maand se wag om oor hierdie saak duidelikheid te kry, nie te veel gevra nie. Die AEB steun hierdie mosie. [Applous.] (Translation of Afrikaans speech follows.)
[Mr C AUCAMP: Madam Speaker, it breaks my heart, but in this debate I have to support the ANC in spite of myself. [Applause.] The AEB quite likes the present format of questions and follow-up questions. Participation by all parties is improved by this. I know there are complaints about members putting up their hands but not being noticed. They simply have to be alert: ``If you snooze, you lose.’’
In South Africa we are a multiparty democracy and not a two-party democracy and the fact that every voice is heard here, contributes to enhancing the value of this institution. All this motion does is to ask that the decision on this matter be postponed until 6 April. We have not heard the DP’s motion and therefore we cannot, at this stage, support a decision being taken today as a matter of urgency. If we have waited for five years now for a section 185 commission, surely it is not too much to ask to wait another month to get clarity on this issue. The AEB supports this motion. [Applause.]]
Mr Q G M DOIDGE: Madam Speaker, our nation faces many challenges … Dougie should not walk out. Our nation faces many challenges that we have come to this House to attempt to solve. Our job as politicians is, surely, to tackle these challenges, to ease the suffering of the poor and to transform a nation torn apart by the ravages of history into one united, productive and creative society.
It is alarming when this House becomes so polarised that the simplest procedural change becomes a contested battlefield, and, unfortunately, the DP is alone on this. It is alarming when the Official Opposition goes back on its word and breaches the agreements reached for the sake of scoring political points; when it fails - and I would say intentionally - to understand or abide by the Rules of this House and the rules of honour, as happened yesterday in Scopa. [Interjections.] We know that the DP and New NP have made a strategic decision to oppose anything and everything put forward by the ANC. [Interjections.] Their marketing experts tell them that it is a good strategy. Maybe it increases their profile, but what harm is it doing to the country?
Instead of dealing with the problems that we should be solving, we are quibbling here. The issue of questions is just such a matter. The DP has consistently opposed changing the question system, ignoring the fact that the new system was less open to manipulation or flooding the question paper by their band of researchers, who have nothing better to do than to score cheap political points.
Rather than encouraging or engaging on matters of policy, as is the task of those who are committed to transformation, the New NP supported the new system of questions when it was introduced. Can we then expect yet another rift in this troubled marriage over this issue? Or will the heavy hand of the Leader of the Opposition prevail?
Earlier this week the subcommittee of the Chief Whips’ forum, which deals with the matter of questions, met to resolve the finalisation of the questions procedure. According to the minutes taken by the parliamentary officials, it was agreed that the interim procedure should be made permanent and that the weaknesses in the system should be identified and rectified before the new system is drafted into the Rules. It was recommended that the subcommittee be given more time to engage on how to streamline the interim questions procedure and make it permanent.
It was further agreed, with no objection from the two representatives from the Democratic Alliance, Mr Ellis from the DP and Caroline Knott from the staff - the New NP was not there, unfortunately - that in the meantime the interim questions procedure should be extended until the end of this term by resolution in this House. I repeat, there was no objection to this. But the next day the DP back-tracked, as they so often do, and said that they would not support this resolution by the House.
They are wasting our time. Let us stop wasting time on this issue. Let us in this extension period resolve the matter, taking into account the weaknesses of the interim system that have been raised, and at the end of this period include in the rules a new system of questions that works for our party in this House and for the people of South Africa. We will take on board the positive contribution from all members who have debated. [Applause.]
Debated concluded.
Motion agreed to (Democratic Party, New National Party and Federal Alliance dissenting)
DIVISION OF REVENUE BILL
(Second Reading debate)
The MINISTER OF FINANCE: Madam Speaker, hon members, the Division of Revenue Bill goes to the heart of co-operative governance and intergovernmental fiscal relations. It is measured not only by the quanta of resources transferred, but, perhaps more importantly, by how the decisions are reached. It is important just to cover this ground again.
Firstly, the fiscal envelope is approved by Cabinet and then, having approved that, Cabinet agrees on the vertical division of resources between the three spheres of government. Cabinet does not do this on its own but invites the nine premiers and the MECs for Finance to a discussion with itself. The vertical and horizontal divisions among the nine provinces are approved by the Budget Council, and also by the Budget Forum which represents both Salga and the provincial local government associations. It is in the method of how we resolve these issues that, ultimately, the test of the application of section 214(1) of the Constitution lies.
In the Bill itself, Schedule 1 deals with the overall allocation of R258,3 billion, of which R104 billion goes to the provinces. Local government gets, as an equitable share, R2,6 billion, and national government, after the deduction of debt servicing costs and the contingency reserve, has R84,3 billion. Schedules 3 to 6 deal with conditional grants and specialised grants, and from these schedules it is clear that local government receives a further R3,9 billion.
What is important about the Division of Revenue Bill, giving the indicative allocations for the next three years, is that there are significant increases in the allocations to both provincial and local government. These sectors both grow faster than the anticipated inflation rate, with the provinces growing at 7,5% and local government at 11,1% per annum. Ultimately, it is these increases that stand as a test of Government’s commitment to service delivery.
This Bill is similar to the one we tabled here last year. It is a timebound piece of legislation that will remain operative until 31 March 2002, if passed by Parliament. This time around it is considerably more user- friendly.
It also needs to be read alongside Annexure E of the Budget Review, in which we deal with the proposals of the Financial and Fiscal Commission, the assumptions we use and the formulae that were applied in order to arrive at the division. This year Annexure E1 is added to provide a lot of detail on the conditional grants.
The information available in this piece of legislation goes way beyond what is required by both the Constitution and the Statutes. The objectives of the Division of Revenue Bill, 2001, are predictability, transparency and accountability, but it also allows for users to understand the consolidation of funding, as in the case of local government, and because of the way in which these issues are set out, it enhances monitoring and the flow of funds.
I move the Bill, but I also move that perhaps Parliament should go to Camps Bay this afternoon and sit on the beach. [Applause.]
The SPEAKER: Order! I will not take a vote on that at the moment.
Mr B TUROK: Madam Speaker, legislation about finance can be dealt with in one of two ways. We can deal with it, first, as an exercise in number- crunching, add a little here, subtract a little there, or alternatively, we can deal with it in policy terms. I prefer the second approach, and I shall try to look at the policy reasons for some of the measures proposed in this legislation.
Most important is to ask the questions: Why? What lies behind a particular
measure? What are the reasons? What are the policy implications? I would
call that the Ben approach''. There is another approach, the number-
crunching approach, which I shall call theKen approach’’. When the hon
Ken Andrew comes to address members after me, members will hear many, many
complaints about the data that has been provided. Members will hear many
complaints about the 6% growth target, many complaints about the lower
provincial ratio of spending and so on. [Interjections.] I ask the House to
pay more attention to the policy measures in this legislation than to the
nitty-gritty number-crunching that they will hear about in a minute.
What are the policy implications of this legislation? The first most important thing is that this is an exercise in good governance. I think the House must pay attention to that because there is an enormous amount of interest in the country as a whole about good governance and what we are going to do about it. The Bill allows a new style of governance to be introduced in South Africa at national, provincial and municipal level, and this will create a great deal of confidence in the country, which is vital for prosperity.
The House will forgive me, for I have a slight throat irritation. Cheers! [Interjections.] Secondly, the vital matter of the performance of the provinces is addressed in the legislation. I started off my political life in 1994 in Gauteng. We were faced with the enormous problem of shifting from the old Transvaal and TPA to the new province of Gauteng. We had to move premises and staff, and enormous restructuring had to take place. Of course, that province is still reasonable new, as so many of the other provinces and provincial structures are.
Therefore the question we have to address - and this Bill asks that question - is: Can these provinces do the work? Can they do the work well, since they have major new financial responsibilities and new financial systems, and the municipalities have an increased role which is dealt with in the Bill?
I want to say that the House must be clear about the role of each sphere of government. I think there is an enormous amount of confusion on this question. I want to quote from the Budget Review, because it sets out this matter very clearly and very carefully. It says:
While the Constitution confers significant autonomy on provincial governments to determine provincial priorities and allocate provincial budgets, national government retains responsibility for policy development and for monitoring implementation within concurrent functions. Although the equitable share allocations and other transfers allow provinces and local government discretion, national policies create mandates that must be accommodated.
On page 241 the review says that there are three spheres of government which have concurrent or joint responsibilities. It continues to say that, in practice, this means that national government determines policy and regulates compliance, while provincial governments are responsible for implementation.
I have made this point because I live in the Western Cape, where the provincial government often forgets about these constitutional requirements. I hope that the provincial government will read the legislation carefully because it delineates their role and functions. Too often the provincial government in the Western Cape, under the leadership of the members on this side of the House, forgets that it is a province. What does it do? It blames national Government for all sorts of things, and sometimes behaves as if it were an independent republic of the Western Cape
- banana republic. [Interjections.]
What is the role of each sphere of government? I want to set out just very briefly what the role of each sphere of government is and where it gets its funds from. Firstly, the national Government has a huge revenue capacity. I do not need to deal with that in detail for we shall be discussing it in the Budget next week. Half of that revenue is spent on protection services and the rest on policy, regulatory functions and administration.
The provincial governments, on the other hand, are quite different. They have a small revenue capacity, but a huge programme of delivery on public goods, such as social services and roads. Delivery is the key, and that is why they get very large national allocations, as is set out in the legislation.
The municipalities are also different. They have a revenue capacity which is quite substantial, and two-thirds of that revenue is spent on services which have user-charges attached. They are able to cope with their needs by raising their own revenue. A third is spent on public goods, such as health, cleaning services and so on.
We can see that each sphere of government operates in quite a different manner. Therefore we need legislation like this to set out those differences clearly. We need this Budget Review and the statements in it to guide us.
The Bill sets out some supplementary allocations to provinces, which amount to something like R2 billion. Those carry certain conditions, such as compliance with the Public Finance Management Act of 1999. They have to have realistic budgets; they have to have proper allocations for education, health, welfare and infrastructure; they must overcome the inequalities of service provision, especially in relation to the poorer communities; and they must ensure an equitable distribution of resources.
One of the most important elements in the Bill is that noncompliance with the Act becomes financial misconduct - a very important principle which I am sure is going to be implemented in a serious way. This will help the Public Service and all spheres of government to perform very well.
I want to raise one last issue, and that is the question of foreign donor funding. This issue is not dealt with in the legislation, but it is an aspect that needs to be looked at. I have ascertained from the Office of International Development Co-operation that these funds from foreign donors are additional to the Budget, and that they are located in the RDP fund in the Reserve Bank. Funds flow from the Reserve Bank to provincial bank accounts for particular projects. Those moneys are supposed to flow very speedily and they usually do, but there are occasions when there are delays, and there are occasions when there may be a danger of the funds being diverted because they are not being looked after adequately.
The point is that those funds are handled by the officials who also handle national transfers and national projects, and so there is sometimes a danger of confusion between the two kinds of activities. It seems to me that we need to look into that. We need to ensure that the donors who audit their own project funding are also working in parallel with the attorney- general and his or her activities to ensure that those funds flow properly.
The question I would like to put to the House therefore is: Can we tidy up this process a little? A major adjustment was made last year. Perhaps we need another look at this, and I would ask that this be taken account of at some stage.
To conclude, this is an exercise in good governance; it is an exercise in financial accountability; it is an exercise in good Public Service performance; and, therefore, the ANC supports the Bill very enthusiastically. [Applause.]
Mr K M ANDREW: Madam Speaker, I am sorry that the hon Mr Turok is so nervous that we may deal with some numbers this afternoon. I think it is rather interesting, when one is dealing with the Budget, that the main speaker on behalf of the Government, who often explains to us that he cannot understand numbers and figures, is the person to deal with the Budget.
There is a Big Ben in London, and we have a little Ben in Cape Town. They have one thing in common and they have one major difference. The one thing in common is that about every hour they each make a big noise. [Laughter.] The difference is that the noise made by Big Ben in London is precise and useful, whereas the noise made by Little Ben in Cape Town is normally imprecise and of little use. [Laughter.] [Interjections.] I also wish to disappoint the hon member in that despite trying to think up figures in the last minute or two, I do not happen to have one figure in my speech this afternoon. So he might even understand it. [Interjections.]
The Portfolio Committee on Finance played the role in respect of this Bill of a general overview. We had a hearing for a morning from various groups, and we had a look at this Bill in general. The National Council of Provinces has taken on the responsibility of undertaking a detailed examination of this Bill next week. The Democratic Alliance’s opinions are therefore, in some respects, provisional and subject to further perspectives and information arising from the NCOP’s hearings and discussions.
We welcome a number of aspects within this Bill. First of all, there is the new clause 8, which provides for a new framework for all grants, which will enforce better planning. These should, in the future, be done in advance of the Budget as some of them have been, and not after the event, as applies to many of them.
Secondly, we also welcome clause 21, which is a new provision according to which the Auditor-General will report on compliance in respect of the allocations and the conditions attached to them. I hope the hon members in the ANC will actually accept those reports and treat them on their merits and not in other ways.
Thirdly, in terms of clause 27 - and this is very important - there is the requirement that funds follow the transfer of functions or obligations. This should help to reduce the problem of unfunded mandates which have plagued our multisphered government system until now. These three measures, we believe, will improve transparency, provide greater capacity for effective oversight in all spheres of government and should also facilitate faster delivery of services to those who need them.
We do, however, have certain concerns. They all, in essence, relate to delivery. I would like to address three of them. We recognise that there have been substantial percentage increases in allocations to local authorities, but this is off a low base. Given the importance of local government in service delivery, one must ask: ``Is it enough, particularly given the massive infrastructural backlogs confronting local authorities?’’
Our second concern is the lack of delivery because of lack of spending of budgeted funds. It is one thing for us, or the Minister, to allocate money to various spheres of government and various provinces, but it is another thing altogether for ordinary people to receive the benefits that were intended. This applies to all spheres of government. We need only recall from recent times the R500 million of welfare money that was unspent over a period of two or three years, and the small proportion of the Health HIV/Aids budget that was spent.
Finally, our concern is that taxpayers’ money is being wasted because of poor planning and management. One need consider just two examples of programmes which have been running for a couple of years, and I refer to page 266 of the Budget Review on which programmes relating to education are set out. This particular programme concerns education grants, financial management and quality enhancement. The transferring department is Education. The purpose of the programme is to improve the financial management of the education system and the quality of education in schools. The measurable outputs are still not available and are to be submitted on 30 April. Although this programme has been in place for a couple of years, the reason it is not incorporated in the equitable share is also to be submitted by 30 April. The monitoring mechanisms, not even in place after a few years, are to be submitted by 30 April. As regards past performance, it says that in the current year reports still reflect that spending is very slow. Finally, capacity and preparedness of the transferring department also have to be submitted by 30 April. This hardly gives one the impression that this department, despite the programme existing for a couple of years, is in a position to use the money effectively and deliver services.
If one looks at the Department of Health’s integrated nutrition programme, the purpose is to feed primary school children, and facilitate nutrition education and health provision. The reason that it is not incorporated in the equitable share is to be submitted by 30 April and the monitoring mechanism is also to be submitted by 30 April. Regarding past performance, it states that there has been significant underspending of this grant since 1998-99. Capacity and preparedness of the transferring department are also to be submitted by 30 April.
It is quite clear that this lack of planning, this lack of understanding of what is going to happen to the money and how it is going to be measured, must result in wasted resources and wasted taxpayers’ money. This needs to be tackled with vigour and as a matter of urgency if people who need the services are going to get those services and get the money we allocate.
Despite our concerns, however, the DA will be supporting the Division of Revenue Bill in the National Assembly. [Applause.]
Dr G G WOODS: Madam Speaker, I was unable to attend the Portfolio Committee on Finance’s briefings due to an overlap in committee commitments, so I will limit my observations more to the general than to the specific. In going through the Bill and in particular Schedule E of the Budget Review, I think it is important to reflect on a number of developments and issues over time.
In a number of countries intergovernmental fiscal relations are contentious and even conflictual. There are other countries with these type of internal relations, yet they experience few problems. In South Africa’s case, notwithstanding the newness of our arrangement, we appear to have achieved very harmonious and functional intergovernmental fiscal relations between our three tiers of government. The Treasury must be given credit for their role in this achievement, particularly at the provincial level. Transparency, participation and the development of rational revenue-sharing methodologies must be largely behind this success.
A noteworthy issue is that the constitutionally motivated Financial and Fiscal Commission, the FFC, has not played a significant role in this. Their researched recommendations on more than one occasion, including the recent costed norms approach, have not been taken up by Treasury. I think it must, therefore, be approaching the time when we are going to have to reconsider the role of the FFC.
With regard to the Division of Revenue Bill before us, we as a party are satisfied that the division of the forecasted national revenue for 2001-02 is sufficiently equitable, with even KwaZulu-Natal telling us that they believe they are receiving a fair share.
We wish to make just a few other observations to voice our approval. Firstly, there is the increased allocation to the local government level, that is essential and I am sure that nobody would contest that. There are also the increased attention to the duties of transferring and receiving funds by accounting officers and the tightening up of the conditions and controls pertaining to conditional grants. As indicated, we are satisfied that the Bill meets all the requirements of section 214(4) of the Constitution and, therefore, we give it our support.
Dr P J RABIE: Madam Speaker, hon Deputy Minister, hon Minister, hon members, the purpose of this Bill is to provide for the equitable division of revenue raised nationally among the national, provincial and local spheres of government for the fiscal year 2001-02. Another key variable is that specific mention is made of reporting requirements for the allocations as well as the withholding and delaying of payment and liability for costs incurred in litigation.
The Division of Revenue Bill must be seen within the context of a broader macroeconomic environment, with the ultimate aim of fostering sustained economic growth, lowering our present unacceptably high levels of unemployment, reducing the spiral of violence and crime, and contributing to a more efficient Public Service to serve the public and private sectors.
Another variable of this Bill is that a number of programmes cut across all three spheres of government, namely national, provincial and local, stretching across a broad spectrum of Government departments. Prioritisation of programmes is usually determined by means of an equitable share formula based upon income and demographic empirical data furnished by the 1996 census, Statistics SA and a number of NGOs.
Another major shortcoming at present is that our database is highly questionable, and the FFC decisions are often benchmark assumptions. The Financial and Fiscal Commission recommended that a new radical approach be taken, namely the costed norms approach. Basically, the FFC’s costed norms approach draws finer distinctions between target beneficiaries and relies on more parameters being used than the current approach applied by Government.
It is of the utmost importance that our very limited financial resources be allocated in a responsible and judicious manner. The Division of Revenue Bill provides for extensive programmes relating to education, health, social welfare, nutrition, housing, municipal infrastructure, rural development, poverty alleviation, HIV, etc.
However, the present position regarding an incomplete empirical database must be addressed timeously, because time is of the essence. I call upon all the respective role-players in all departments to conduct a representative census in 2002. Proper planning and good governance require accurate empirical data. The present state of affairs regarding our available data is clearly untenable.
Tax Bills, in general, relate to fairness. A sound tax morality can only be cultivated if sound performance measures are taken. If timeframes regarding all government expenditure are met, local, national and provincial officials will have to report on measurable outputs in future. There is ample room for further improvement. Today poverty, HIV/Aids and crime affect all South Africans, rural and urban, to an increasing extent. Increased government spending will not necessarily solve our problems. All departments must put norms and standards in place that can be applied to evaluate their outputs. Attainable incentives for targets reached and penalties for failures must also be implemented. I am afraid this should apply to political office-bearers as well.
Today we find ourselves in a global economic order. Tax reforms in other emerging markets are increasingly drawing skilled South Africans away, a fact which is reason for serious concern regarding potential revenue. To cite one example, the tax burden on households has increased alarmingly. In the 1960s personal tax collected stood at below 10% of GDP, by 1990 personal income tax and VAT had amounted to more than 21% of GDP. The net tax burden, tax paid less services, has increased even further. This is the reason why present households debts are of grave concern to all responsible South Africans.
The DA support the Division of Revenue Bill.
Dr G W KOORNHOF: Madam Speaker, hon members, the Bill before us represents the sharp end of the national Budget in so far as it empowers the three spheres of government to implement policy and deliver services to our citizens. Any possible nonspending of amounts allocated, corruption, misuse of funds, maladministration and incorrect allocations will nullify the good intentions contained in the national Budget.
The real test of Government’s policies will be in effective service delivery, particularly in the next 12 months, but also during the MTEF period. An interesting tendency emerging from the Bill relates to the vertical division of revenue, in which the provincial share decreases from 57,6% to 56,7%, putting it at a lower end of the MTEF than in 1999-2000. If this tendency is projected over a longer period, provinces may find themselves sandwiched between increased spending at national and local government level. The Minister may wish to confirm whether this is, indeed, the intention of national Government.
Related to this relatively decreased allocation to provinces is the issue of possible provincial taxes or increased own revenues. The FFC indicated that they will make recommendations in this regard during April 2001. We appeal to the Government to handle this matter with caution, as people already carry a heavy tax burden. It may also be also to re-examine the Katz commission proposals on provincial taxation and provincial own revenues.
A major deficiency in the Bill before us is the gaps in allocations. A number of allocations have not yet been gazetted and are only going to be gazetted after the beginning of the new financial year. This issue will obviously create a lot of uncertainty, especially regarding the recurrent grants to local government, for instance spending on local or municipal infrastructure and basic water services, and also the indirect grants to public entities and NGOs, for example the spending on the land reform programme.
Therefore we are in a sense voting blindfolded for allocations of which we have no details as to who exactly will receive these allocations. We do not know whether provinces will receive these allocations and what amounts have been allocated to the various provinces. A glaring example is the fact that a few provincial allocations exist in Schedules 5 and 6 of the Bill. No amounts have been allocated for HIV/Aids for the MTEF period in the years that it has been allocated.
Overall, the UDM supports the Division of Revenue Bill.
Mr S N SWART: Madam Speaker, hon Minister, as has been pointed out, section 214 of the Constitution requires that the Division of Revenue Act be enacted by Parliament on an annual basis. This Act determines the equitable division of the nationally raised revenue amongst the three spheres of government and the horizontal division between provinces.
During last year’s debate, the hon Hogan stated that this Bill could quite happily be amended by Parliament because it was not a money Bill. That being so, I want to pose a question to the hon the Minister of Finance: Is Parliament merely a rubber stamp for the Division of Revenue Act? The reason I raise this concern is that certain provincial parliaments have already tabled their provincial budgets prior to the approval by this House and the NCOP of the Division of Revenue Act.
I appreciate the requirement of a parallel process, as well as the need for three year rolling spending plans for national and provincial departments under the Medium-Term Expenditure Framework. Furthermore, I accept that section 27(2) of the Public Finance Management Act requires that the provinces table their budgets no later than two weeks after the tabling of the national Budget, subject to the Minister extending this period on application.
However, does this process not assume acceptance by Parliament of this Bill? Is this what was envisaged when section 214 of the Constitution was drafted? My colleague in the NCOP, Mr Durr, has raised this concern and I understand that this Bill will only be considered next week by the NCOP select committee. This underscores our concern of Parliament merely being a rubber stamp of the Division of Revenue Bill.
We are also concerned that provincial allocations have decreased. This situation results in provinces seeking alternative ways to boost their earnings. In this regard it is unfortunate that gambling levies are being considered by the Financial and Fiscal Commission as a means of boosting provincial revenue.
In conclusion, whilst we have expressed our reservations regarding the process and certain aspects relating to gambling income, the ACDP supports this Bill.
Mr G E BALOI: Madam Speaker, hon Ministers and the hon the Minister of Finance, Mr Trevor Manuel, first and foremost the aim introducing this Bill is to provide for the equitable division of revenue raised nationally among the national provincial and local spheres of government for the 2001-02 financial year; reporting requirements for such allocations; the withholding and delaying of payments; liability for costs incurred in litigation in violation of the principles of co-operative governance and intergovernmental relations; and to provide for matters connected therewith.
We in the UCDP applaud the hon the Minister of Finance for a very sophisticated, well-balanced and increased Budget tabled on 23 February this year. According to the Budget allocation, every department got its rightful share to allow it to deliver to the needy. However, I want to inform the hon the Minister that our national Government can deal with this division of revenue and divide revenue equitably among the provincial and local spheres of government, but it cannot follow this up to see whether the funds have been utilised correctly.
In our province, the North West, misappropriation of funds is sky high. This brings the name of the province and the Government into disrepute, because funds are being channelled into the wrong parastatals.
According to section 214(1) of the Constitution, an Act of Parliament must provide for, firstly, the equitable division of revenue raised nationally, secondly, the determination of each province’s equitable share, and thirdly, any other allocations to provinces, local government or municipalities from the national Government’s share. We say that follow-ups and report-backs must be made by the relevant MEC.
The President said in his speech, and I quote:
We want to root out corruption in the Government and its departments.
Let those sabotaging the Government of the people be removed, as they want to see its downfall. The UCDP is very concerned about what is happening in some spheres of government. We accept the concept of the Bill at all costs.
Ms F B MARSHOFF: Madam Speaker and hon members, the Minister is to be congratulated on presenting us with a Budget that builds on our policy framework, ie delivering services more efficiently and effectively. The new reform process, development of service delivery, investment in human and physical infrastructure, and initiatives focused on HIV/Aids and special needs is a positive step towards achieving equity.
Various measures such as the Budget reform process, the Public Finance Management Act and the new Public Management Framework are aimed at improving the quality of spending. The new format of the Estimates of National Expenditure, which tracks service delivery performance, enhances accountability towards Parliament and the public. The move towards increased expenditure on infrastructure, prioritising water and sanitation, is very encouraging. Expanding these programmes is crucial in the light of economic growth and stimulation.
In 1996, a facility order was carried out and revealed that a third of our facilities, by value, needed replacement. It was further estimated that it would need R12 billion over an eight year period to address this backlog in infrastructure maintenance. To this effect, the Cabinet has approved a major revamp of the hospital infrastructure. Through this effort, we hope to reverse the decades-long impact of apartheid planning by rescheduling our hospital portfolio. New facilities will be built in certain instances, while others will have to be scaled down or closed down completely.
The Minister must be applauded for allocating a major chunk of the provincial and conditional grant amounting to almost R5,9 billion to the health sector. This is mainly for central hospitals, training, rehabilitation and nutrition programmes. A glance at the Budget also reveals that the health grant will have increased to R6,3 billion by the year 2003-04. This constitutes about 47% of the total conditional grants to provinces. As hon members are aware, the health grant includes five hospital grants, which I will not mention now, a nutritional grant and one for HIV/Aids. These grants support reform in their health care delivery system. The allocation to the hospital rehabilitation grant amounts to R500 million for 2001-02, increasing to R543 million in 2003-04.
There is an urgent need to further develop and improve the provision of hospital services throughout the country. This includes guidelines for the number of beds at different levels that are required and affordable for us as a country, including planning options for the provision of tertiary and highly specialised services, as patients often need to be transferred from one province to another.
The redistribution of the specialised health services grant has a significant capital component. The grant is used for the acquisition of specialist equipment, specialist training and an incentive for specialists who relocate to poorer provinces. In part, this will also correct the skewed distribution of health facilities and personnel, especially in the rural areas.
This year provinces continued to receive conditional grants which are transferred from the national Budget to subnational governments. The Division of Revenue Bill spells out crucial monitoring and reporting requirements for all conditional grants. A new grant to facilitate the support and construction of a new epidemic hospital in Pretoria has also been introduced. This is in line with our policy of providing health care for all. The allocation of this grant amounts to R210 million over the three year medium-term framework.
We have learnt over the past three years that the HIV/Aids epidemic, which is rising sharply, requires a holistic and integrated multisectoral approach to enable us to withstand the sharp increase. We know that HIV/Aids is not only a health concern, it is everybody’s concern. To this end the 2001 medium-term allocation for HIV/Aids builds on the total allocation of R75 000 million made to the welfare and education sectors to finance a more effective and integrated response to HIV/Aids. These focus areas of note are: Rolling out life skills in all primary and secondary schools, increasing counselling and testing services, as well as public campaign and community mobilisation.
In keeping with political changes, over half of the additional resources have been allocated to provinces in this Bill, in recognition of the changes that face delivering social services, building and maintaining economic infrastructure and so on. Therefore, local government, which has to manage the amalgamation of various local authorities and provide free basic service gets the largest slice of revenue. This increase includes major increases to the equitable share and the addition of new conditional grants to assist municipalities with the once-off transition costs arising from the demarcation. In total, the national transfers to local government increase from R5,7 billion to R7,8 billion over the three-year period. This is an average increase of 11%.
The district health system provides the health sector with a management framework that can deliver health care in a cost-effective and integrated manner. Once this district health system’s development can be anticipated and once local government restructuring is complete, the challenge in the health sector is to consolidate gains in health care provision and to participate in the establishment of the district health system, governed by local government where they have the capacity to render these services.
We know that the major factor that has impacted on service delivery has been the lack of effective financial management, planning and project management capacities by municipalities. This Government is committed to reducing the gaps between the provinces and our people in general, and although this budget goes a long way towards ensuring that we reduce these disparities - which are historical - we must ensure that we keep our Government and our officials accountable in every way. The Public Finance Management Act, for example, must be used effectively. We must compel departments and provinces to comply with the requirements, and we must come down hard on those departments and provinces which fail to spend their allocations due to capacity problems or because of a lack of planning.
To this effect I would like to say that this Budget is testimony to the fact that South Africans are now enjoying the fruits of their hard labours.
Miss S RAJBALLY: Madam Speaker, the main purpose of the Bill is to provide for the equitable division of revenue raised nationally among the national, provincial and local spheres of Government for the 2001-02 financial year; reporting requirements for such allocations; the withholding and the delaying of payments; and liability for costs incurred in litigation in violation of the principles of co-operative governance and intergovernmental relations. The improvements in the Division of Revenue Bill contribute towards a more effective management of the Medium-Term Expenditure Framework. The Bill is in compliance with section 214(1) of the Constitution and section 10 of the Intergovernmental Fiscal Relations Act, 1997. Trade liberalisation can interact with the domestic tax system and the macroeconomic environment, with implications for economic growth, revenue and the overall budget.
The objective of the change in the Bill is to mobilise a system that constantly strengthens intergovernmental financial relations. This places emphasis on the reprioritising of the allocation of funds, which has the potential to make an impact on the delivery of services to the most needy. Thus, this automatically recognises the administrative weaknesses in certain municipalities.
Overall, the Bill provides equality of opportunity to access development for each province and municipality. The MF compliments the Government on allocating R1,5 billion a year to poverty relief programmes and allocating funds for projects such as water supply and sanitation, particularly in cholera-affected areas and where national departments have suffered damages to their infrastructure. The MF supports the Division of Revenue Bill and congratulates our Minister on introducing such a comprehensive Bill. [Applause.]
Mnr C AUCAMP: Agb Speaker, tydens dieselfde debat ‘n jaar gelede het ek my kommer uitgespreek oor die feit dat munisipale owerhede ‘n te klein deel van die begrotingskoek kry om effektief te funksioneer. Ek het verwys na die R1,8 miljard wat volgens die gelyke-aandeelformule aan derdevlak- owerhede toegeken is.
In sy repliek het die Minister, in sy unieke en treffende Afrikaans, soos volg geantwoord:`` Die toewysing aan plaaslike bestuur beloop om en by R6,5 miljard, want daar is allerlei toekennings bo en behalwe die bedrae wat ingevolge die gelyke-aandeelformule toegewys is.’’ Die bedrag wat volgens hierdie wetsontwerp, volgens die gelyke-aandeelformule aan munisipaliteite toegeken is, is wel verhoog na R2,6 miljard. (Translation of Afrikaans paragraphs follows.)
[Mr C AUCAMP: Hon Speaker, during the same debate a year ago, I voiced my concern about the fact that municipal authorities do not get a big enough slice of the budget pie to be able to function properly. I referred to the R1,8 billion which, according to the equitable share formula, was allocated to third tier authorities.
In his reply the Minister responded, in his unique and striking Afrikaans, that ``the allocation to local government amounts to approximately R6,5 billion, because there are various allocations over and above the amounts which have been allocated in accordance with the equitable share formula.’’ The amount allocated to municipalities in this Bill, according to the equitable share formula, has indeed been increased to R2,6 billion.]
According to Schedule 1 the local government conditional grants amount to R3,88 billion, which gives us, together with the equitable share amount, a total of R6,5 billion, the same amount that the Minister mentioned in his reply last year.
Kan die Minister asseblief aandui of dit wel die geval is? Is daar iewers ‘n verdere toewysing aan plaaslike owerhede, want dit kan nie dieselfde bly nie.
Volgens artikel 214 van die Grondwet, is een van die redes vir die toewysing en verspreiding van fondse om te verseker dat provinsies en munisipaliteite in staat is om basiese dienste te voorsien. Ons staan in ‘n nuwe bedeling ten opsigte van derdevlakregering. Groter verantwoordelikhede word op munisipale owerhede geplaas. Die twee grootste partye het tydens die plaaslike verkiesing mekaar oorbie met beloftes van gratis basiese dienste. Die vraag, soos Johannes sê, is: ``Wie zal dat betalen?’’ Die nuwe belastingbedeling, waarvolgens plaaslike owerhede belasting kan hef op verbeteringe en nie net grondwaarde nie, lê en loer. (Translation of Afrikaans paragraphs follows.)
[Can the Minister please indicate whether this is indeed the case? Is there a further allocation to local authorities somewhere, because it cannot remain the same.
In terms of section 214 of the Constitution, one of the reasons for the allocation and distribution of funds is to ensure that provinces and municipalities are able to provide basic services. We have a new dispensation with regard to third tier government. Municipal authorities have greater responsibilities. During the local elections the two largest parties outbid one another with promises of free basic services. The question, as posed by John, is: ``Who will pay for that?’’ The new tax dispensation, according to which local authorities can levy tax on improvements and not only land value, is around the corner.]
In his Budget Speech the Minister announced tax relief of more than R8 billion. I am afraid that we may experience a situation of ``What Trevor gives, the mayor takes’’, and even more.
Ek wil vir die Minister sê dat ons derdevlakregering nie mag afskeep nie. Dit raak ons mense op die mees direkte wyse. Ek wil pleit vir ‘n groter afwenteling van fondse daar waar dit saak maak, derdevlakregering. Die AEB steun nietemin hierdie wetsontwerp. (Translation of Afrikaans paragraph follows.)
[I want to say to the Minister that we must not neglect third tier government. It affects our people in the most direct way. I want to plead for a greater devolution of funds to where it is needed, namely third tier government. Nevertheless, the AEB supports this Bill.]
Mr M K LEKGORO: Madam Speaker, hon Minister, the objective of the Bill before us is to divide nationally raised revenue between the different spheres of Government.
The provision of equitable resources to the different subnational levels of Government is an important function because provinces and local government have a strategic developmental role to play in our society. The subnational governments, whilst independently established and have autonomous existence, are bound by national policy and our different national objectives. It is for this reason that in addition to the performance of the traditional subnational functions, they have to implement national programmes that seek to improve the quality of life of the people.
In addition to the equitable share of nationally raised revenue, national Government allocates additional resources to the subnational governments for the implementation of specific programmes. The Division of Revenue Bill does this by allocating a variety of conditional grants for different purposes. Conditional grants are designed to support specific government programmes that are aimed at addressing specific developmental needs that are not budgeted for by provincial and local government.
The equitable distribution of nationally raised resources in this manner makes it possible for provincial and local governments to execute their constitutional mandates. The bulk of the activities of these governments are service-delivery-based. They range from road construction to the provision of clean water and sanitation.
The provision of these services not only requires huge amounts of resources, but also has serious socioeconomic implications for the entire country. One can imagine what would be the economic effects of a failure to keep any part of our economy-enhancing infrastructure, such as roads, in working condition.
To date, conditional grants have played an important role. They focus the provinces and local government on national strategic priority areas. There are, of course, isolated instances in which these grants cause administrative inefficiencies, but these are being resolved.
This year’s Division of Revenue Bill builds on the experience of previous years and improves on the controls and management of the resources provided to the subnational spheres of government. The duties and responsibilities of transferring and receiving officers and the reporting mechanisms are better detailed and tightened in line with the Public Finance Management Act.
On the other hand, the Bill supports the national drive for economic growth. It allocates R5,3 million to the provinces to repair infrastructure damaged by the floods and to supplement growth-enhancing infrastructure projects in the economic sector. These will include roads and schools.
It is important to note that the labour absorption capacity of the primary and secondary sector of our economy has diminished tremendously. The only sector that is capable of absorbing labour is the tertiary sector. This requires new and qualitatively different skills. Our country has no alternative but to enhance the quality of our education system in order to produce high-calibre people who are highly productive and globally competitive.
In line with this, the Budget has allocated R213 million in grant funds to enhance the quality of the education system for the year 2001-02. This figure will gradually increase throughout the medium-term period. The increase in the social budget makes it possible for us to address the needs of the masses of our people. It is for this reason that the ANC supports the Bill. [Applause.]
The MINISTER OF FINANCE: Chairperson, hon members, let me express appreciation to all the parties for their support for the Division of Revenue Bill. A few brief comments might, I think, be in order.
Firstly, the hon Andrew raised the fact that local government would be increased off a low base. The key concern is, of course, the risk of opening a huge moral hazard. That is why in the Budget Speech - and it is worth repeating today - our emphasis is actually on building capacity, and this has to be the testing ground.
The hon Woods raised the question of whether we should not reconsider the role and the responsibilities of the FFC. That, of course, is entirely at the hands of Parliament because it would require a constitutional amendment. The hon Rabie, I think, spoke on tax issues which we will deal with when we deal with the Main Appropriation. Dr Koornhof raised issues relating to Schedule 6. The reason why there are not any funds in Schedule 6 for a number of the issues is that there are indirect transfers that need to be resolved.
One of the key areas relates to land transfers in order to provide housing. But before one can provide housing, one needs to provide municipal services. A lot of this is still work in progress and therefore one cannot allocate resources that would park against a particular allocation when, in fact, the detail would be resolved sometimes through negotiations, willing buyer-willing seller, and sometimes in court as a consequence of the implementation of the expropriation legislation.
The hon Swart raised the issue of the tabling and in regard to that, there will always be a catch-22 situation. Before we can divide the revenue we have to appropriate the total sum. This is a difficulty that does confront us. Thus, we have tried to have an ongoing presence through the process of the Budget Council which includes the chairs of both the portfolio and select committees. The provinces and local government, of course, are very directly involved in the Budget Forum stage. But there is an informal arrangement that needs to be approved by Parliament. We have not been able to find any alternative. In the NCOP there has been a suggestion that we table the Division of Revenue Bill much earlier, but that would tend to create a contradiction because one does not have a total envelope approved, which is something that Parliament will actually only do when it votes on the Main Appropriation.
The transfers to provinces are not decreasing. They are increasing, as I indicated earlier. However, in respect of gambling revenue, let us be very clear about this. The Constitution makes it abundantly clear that we cannot decrease the transfers to any province, because they have the ability to raise their own revenues. There is, in fact, ringfencing. What they can raise through motor vehicle licensing, hospital fees, gambling and whatever else within their power, is additional to what we have to transfer. We transfer on the basis of a formula that does not take any account what the provinces can raise for themselves.
In respect of the question by the hon Ds Aucamp, Table E12 on page 251 of the Budget Review sets out the total transfers to local government. Whilst the equitable share is R2,618 billion the total is R6,507 billion, thus increasing by 14% on what it was in the past year. The issue is how much capacity we can build and I think that some local authorities will need a different kind of support. It is a capacity in which some have no ability at all.
I made mention the other day of some newly established local authorities close to where the hon member comes from, like Louis Trichardt, which has a town with some revenue-raising ability, but where there are all those rural areas around there which are actually under tribal trust and, therefore, have no revenue-raising ability, while services need to be provided to all the inhabitants there. Those are special cases that need to be dealt with, not as part of the general provisions. Thus, rather than first have a formula by which we allocate, we need to test this and understand it a lot better. I am sure that the allocations next year will be far more focused than we have been able to do in the short period between the elections and the present.
I would like to thank all members and parties for their support. [Applause.]
Debate concluded.
Bill read a second time.
THE CHALLENGE OF OVERCOMING POVERTY AND INEQUALITY
(Subject for discussion)
Mr A J FEINSTEIN: Chairperson and colleagues, as we enter the new millennium in the hope of a century more civilised, just and caring than the 100 years that have recently passed, we must acknowledge that almost half of the world’s people live on less than US$2 per day and that 1,2 billion of our fellow human beings live on less than a dollar a day.
In addition, our millennial world is characterised by massive inequality between countries and amongst people within countries. The average citizen of the First World has a standard of living seven times greater than that of the average citizen of the Third World. To put this in a more practical context: in India more women die in pregnancy each week than in the whole of Europe each year.
In South Africa about 19 million people can be described as poor in terms of international benchmarks. Almost 10 million of these people are ultrapoor, living on less than a dollar a day. What exacerbates the extent of this poverty is, as the World Bank noted in 1994, that South Africa exhibits the most bitter of social outcomes - destitution amid plenty.
The figures bear this out. The poorest 40% of households account for only 11% of income, while the richest 10% receive 40% of income. For many years the extent of inequality in South Africa was the highest in the world. Today it is second only to Brazil.
From Khayelitsha to Mayela, millions of South Africans face a daily struggle just to survive. We all know that, because of the lunacy of apartheid, this inequality remains cleaved along racial lines - 61% of Africans are poor, compared to 1% of whites. In addition, inequality within the African and white groups is also substantial and growing. Seventy per cent of South Africa’s poor live in rural areas. Three in every five children live in poor households, because the poverty rate amongst female- headed households is 60%, considerably higher than the rate of 31% in male- headed households.
While surveying this frightening picture we should, however, also take heart from the fact that since the Second World War there has been a substantial reduction in global poverty. Worldwide malnutrition and infant mortality rates have been reduced, adult literacy raised and the purchasing power of large numbers of very poor people significantly increased.
This has been accompanied, though by ever-increasing inequality. The effects of poverty manifest not only in the material sphere, but also in the psychological and social spheres. The erosion of self-esteem, the undermining of dignity and the oppression of passivity have affects that may be almost as damaging as the lack of adequate nutrition, health care, schooling or shelter.
In addition to the alleviation of absolute poverty, any progressive project must be committed to a fairer society in which the disparities between rich and poor are small, in which the paradox of poverty alongside prosperity is nonexistent. These are the momentous challenges that face us; to create a society where none shall want for their basic needs and where the rich and the poor inhabit the same planet, rather than live in different galaxies. This is required of us, not only for reasons of common humanity, decency and justice, but for hard-nosed economic reasons as well.
Prof Iraj Abedian, chief economist of the Standard Bank, is of the view that unless poverty is addressed prospects for the South African economy over the medium term remain uninspiring. Stephen Gelb of the Development Bank of Southern Africa suggests, on the basis of a recent study, that low investor confidence in South Africa is linked to firms’ insecurity over the high degree of polarisation and inequality in society. Thus, while increased domestic and international investment is essential to growing this economy in creating jobs which will, in turn, contribute massively to alleviating poverty, the attraction of this investment itself requires interventions to alleviate poverty and inequality.
This is the ultimate chicken-and-egg scenario, and it can only be addressed by a range of parallel interventions by various sectors of our society. Firstly, it is the challenge of creating life-long training and learning that will enable people to flourish in our restructuring skills-driven economy. This requires interventions, both at formal school and postschool levels, and an intensification of sectoral vocational skill development.
The building of greater trust between Government and business, the more rapid winding down of the forward book, restructuring of appropriate state entities and a range of microeconomic interventions will contribute to a faster-growing and more stable economy. However, the reality of our economic structure is such that higher growth, which will be driven by the capital skill intensive sectors, will exacerbate inequalities during this generation, as those with limited skills will continue to remain outside the formal market.
To address this unfortunate likelihood requires significant increases in public works programmes, especially around fiscal and service infrastructure, programmes that provide limited income for a temporary period, at least, but most importantly, transfer skills and training that will be useful for future employment. In addition, the growth of a lower entry level sector such as tourism and various forms of household services becomes critical.
This structural reality of our economy further requires that our welfare system is able to support those who fall outside the formal sector. This social spending will contribute not only to improving the quality of life of the poorest of the poor, but to the potential for greater investment and growth.
A comprehensive rural development strategy premised on measured constitutional land reform that increases incomes in this sector will play a critical role in addressing the poverty under which 70% of rural dwellers live. This House has heard over the past few weeks that, together with the strengthening economy, Government either has launched, or is about to launch initiatives in each of the areas mentioned. This must be loudly applauded. What would add greatly, both to the perception and the practical implementation of these initiatives, is one coherent strategy that reflects how these elements work together towards the objective of a more prosperous and just society.
Clare Short, the widely respected Minister for International Development in the UK, suggests that ``good government makes globalisation work for people’’. For our multidimensional strategy to achieve its objective, therefore, requires that Government continually strives to improve the quality of governance in our society. The Public Service must become an adaptable, learning and accountable entity in which service and integrity are paramount.
The challenge for us as parliamentarians is to ensure that the Public Service is results-driven, accountable to the needs of the people and above reproach in dealing with public money. We must become intolerant of underperformance and resolute in our determination to fight corruption, wherever it may be found.
The challenge for us as a nation is to ask ourselves how we can contribute to the achievement of a more prosperous and equal society. Those of us who have benefited from the racial oligarchy of the past have a special responsibility in this regard.
Let us reignite the spirit of unity of the early days of our democracy. Let us unite - the rich and the poor - in slaying the evils of poverty and inequality. Let us unite - black and white - to build a prosperous, just and safe South Africa of which we can all be rightly proud. [Applause.]
Mr W J SEREMANE: Chairperson, hon Deputy President, hon Ministers and hon members, listening to the previous speaker, I nearly usurped powers from other people’s vocation. I nearly said: ``God bless you, my son.’’
The other day the Minister for Agriculture and Land Affairs aptly quoted from Scotts’s Different Drum - Building Community. But what she omitted quoting from the same source was that, and I quote:
Prophets are almost invariably bearers of bad news. They proclaim something is wrong with their society. But people do not like to hear bad news about themselves, which is why prophets are often stoned or, otherwise, scapegoated, and in our South African context people marginalised and vilified. Let these sins be forgiven, however.
The subject at hand, ``The challenge of overcoming poverty and inequality’’, cannot really be detached from the other socioeconomic and political strands of society. Development or empowerment, entitlement or dependency, social engineering via the allocation of resources and the crafty chaff of rhetoric masquerading as reconstruction and development cannot escape public scrutiny.
The material condition of people seems to remain the same despite what the new ruling elite may want us to believe. The critical issue, although it may be correct, is no longer so much the cliché, ``legacy of the past’’, but the current Government’s competency and efficiency regarding delivery. Does the prince, despite his blue blood, deliver to the poverty stricken or not, that is the nub of the conundrum.
I do not wish to sound overkilling, but when we want to tackle poverty or inequality, we have to travel the route of, inter alia, development, that is empowerment for self-upliftment and self-reliance. However, this development should not culminate in people being domesticated, having been given a false notion of entitlement or, worse still, a mentality of dependency.
Members will remember Thomas Jefferson’s assertion that: ``Dependency begets subservience and venality; it suffocates the germ of virtue and prepares fit tools for the designs of ambition’’. It is not overstating facts to point out that to improve the welfare of the citizens of South Africa we must focus on job creation and skills development, not only in order to tackle poverty and to bridge the wide gap of inequality, but also fundamentally to create opportunities for people to become economically independent and to regain their self-respect and sense of dignity in order that they may enjoy greater freedom.
The assumption that prevailed in 1994 that a rural family with two adults and three children needed R740,00 per month to survive - yes, indeed, survive - and that a similar urban family required R840,00 per month needs to be drastically reviewed. Welfare and social services are critical areas that could enhance the fight against poverty and, indeed, abject poverty. Welfare services are mostly state-run, but it is also desirable that more and more large portions should also be driven by NGOs and the private sector. The NGOs should be given special support in improved funding, especially in doing work in remote and rural areas of our country.
There also seems to be problems with the criteria of evaluating organisations such as NGOs in this field. It is not sufficient to base evaluation of organisations only on unit costs of facilities and the number of people which the organisation serves. Emphasis has also to be put on quality. Qualitative services and delivery are critical and crucial. The DP welcomes the move towards a more holistic evaluation system when dealing with the NGOs rendering these important services.
It is cold comfort to live by the dictum that ``the poor shall always be with us’’. The challenge of poverty is, indeed, enormous and needs to be tackled at all levels, by all and sundry. We should not shy away from innovative ways of dealing with this gigantic task, and my colleague will illustrate briefly how to go about addressing some of these tasks that are facing us. Once a people are sustainably self-reliant and self-sufficient, we can safely begin to have confidence that the issues of inequality - socially, economically and politically - will begin to be tackled more effectively and equitably.
In conclusion, I would like to say that perhaps we should also concentrate more vigorously on building capacity at the provincial and local levels, so that this intensification of our efforts may benefit the poor and those who are at the bottom of our so-called disparity of resources. [Applause.]
Mrs I MARS: Mr Chairperson, hon Deputy President and Ministers, I want to start this discussion by asking what our vision is for future generations of South Africans. I would like to believe that everyone in this House shares with me the view that it is our mission and duty to create for future generations an environment in which it is possible for every citizen to reach their full potential, free from want and rich in fulfilment. We want a future in which we no longer have to refer to the majority of South Africans as the previously disadvantaged and the poor.
With that goal in mind, let us determine the action we can take in order to level the playing fields, thereby overcoming the legacies of inequalities and poverty. I believe that the most important tool at our disposal is education. There is no doubt that students in well resourced learning environments have a great advantage over those who have to struggle with poorly equipped facilities and poorly trained teaching staff, notwithstanding the fact that there are exceptions where poorly equipped schools have achieved extraordinary successes.
Therefore, if we prioritise education as a major tool for levelling the playing fields in order to eliminate inequality, then we need to examine the current state of our education facilities. The President, in his speech to the nation, specifically made reference to the IT sector. It was not surprising to read in last night’s edition of The Star that the Minister of Education wants all schools to be on line and that a forum has been established to examine ways and means of achieving this by creating a national education network in order to link schools, through regional and national education departments.
As 87% of our schools are without electricity and other necessary facilities, this appears to be an impossible challenge. But unless we face this challenge and overcome all obstacles, inequality will not be eliminated. Our chances of improving the lives of our most marginalised communities are unlikely to be achieved. I do believe that if we truly focus on this issue we can and will succeed.
To face the challenge of globalisation and in order not to increase the levels of poverty in South Africa, we need a motivated and well trained workforce. I believe that the Right Honourable Claire Short, Secretary of State for International Development, in her address ``Making globalisation work for the poor’’, issued a further challenge to us to work out for ourselves how we, in the context of our realities, can turn what is currently a threat into an advantage.
In the short term, we still have to look at empowerment programmes and projects in order to alleviate poverty. This will have to be undertaken in close consultation with communities. Small industries such as arts and crafts, sewing and so on, still need to be encouraged. We have to understand that communities are more than capable of identifying their own projects. We need to continue to empower them by training and marketing and other skills, and giving them access to materials needed to get these projects started.
Communal food production also needs to be encouraged. It is possible to negotiate land-use for vegetable growing and one only needs a supply of small tools and seeds. Alleviation of the ravages of poverty should be our immediate concern, followed by more integrated approaches in the medium to long term. The management of HIV/Aids needs to be revisited in terms of communities as the death of income-generating family members deepens poverty, not only for the affected families, but for whole communities. To overcome poverty, we need to specifically take note of the needs of the poor in all our planning and decision-making. There is no short-term solution.
Mr A Z A VAN JAARSVELD: Mr Chairperson, during 1995 South Africa took part in the world summit on social development in Copenhagen where the South African Government endorsed 10 very important commitments that have a bearing on the restructuring of post-apartheid South Africa, with specific reference to poverty and inequality.
Through this agreement, the Government committed itself to issues such as the creation of an enabling environment; the eradication of poverty; socio- integration through a stable, secure and just society; and accelerated socio-economic human development and empowerment in a society where the people enjoy freedom from violence.
The New NP and DA fully endorse these objectives in an attempt to improve the quality of life of all South Africans. It is necessary to have the commitment of all South Africans to tirelessly build a nation that can be freed from the shackles of the past and burdens of poverty and inequality. We have to acknowledge the fact that, if nothing else, the ANC-led Government has succeeded in creating hopes and dreams. They have succeeded in capturing the emotions and expectations of people who were prepared to put their trust in those who headed the struggle for an equal and just society.
However, the further we move away from Copenhagen 1995, the more people are waking up from their dreams of a new, prosperous South African society and now face the reality that the very people whom they trusted do not have the ability to actually manage the process that would finally free them from their past. These people led them out of the bondage and slavery of apartheid and are now wandering around in the desert of disillusionment. They see leaders who are not able to take them to the promised land through an integrated and sustainable approach to harness all the country’s resources towards redistribution and development.
They are taking them further away from a people-driven process which should have been inclusive of all regardless of race, sex, urban or rural, rich or poor; further away from peace and security, ignoring the reality of a journey of reconstruction of the society in a process of nation-building to unify the country, utilising all its resources to enrich the people both materially and spiritually.
It is evident that more and more people in South Africa are siding with the only movement that can address this issue of overcoming poverty and inequality in South Africa in a practical way. They are moving away from empty election promises towards a party which can understand the need for proper housing and jobs, and wants expertise to run the economy of this country and attract the necessary investments to prevent further job losses. In short, the DA is clearly the best option to take the whole of South African society away from pipe dreams, into the full reality that human development is the end and economic growth the means. [Interjections.]
The purpose of wealth should be to enrich people’s lives, broaden their choices and enable every citizen - every child, every woman and every man - to reach his or her potential. It is only when we have reached that goal that we will be able to say we are addressing the challenge to overcome poverty and inequality in this country. [Interjections.]
The MINISTER OF FINANCE: Madam Speaker, will the hon member take a question about the NP?
Mr A Z A VAN JAARSVELD: Not now, Chairperson.
In conclusion, I would like to thank the hon Feinstein for bringing this motion to Parliament and for the very competent way he presented it, giving us an opportunity, in this South Africa, to support it in our way. [Applause.] [Interjections.]
The CHAIRPERSON OF COMMITTEES: Order! The hon L Mothiba will be delivering his maiden speech. [Applause.]
Mr L C MOTHIBA: Mr Chairperson, it is especially fitting for me that my first parliamentary speech deals with a central theme of UDM policy.
It is our painful past that meant that inequality was the result of political oppression. Now, having attained political freedom, we have discovered that poverty perpetuates inequality. Politically, we are liberated but we still have to attain economic liberty.
Poverty is inextricably linked to the unemployment crisis facing South Africa. All UDM policy is based on the tenet that we must reduce the gap between the haves and the have-nots. To this end the UDM proposes that enterprise development should be the solution that South Africa embraces now. We must empower South Africans to create their own wealth and employment.
If we have to attain such a goal, we need to recognise certain realities of modern-day South Africa: Firstly, access to capital is still a privilege not available to the majority of South Africans. In this regard the UDM suggests that a number of innovative financing options be explored. To name but a few, tax incentives to encourage venture capital investments, local stock exchanges and so on.
Secondly, we must realise that enterprise development is not possible when the majority of South Africans have been deprived of education and skills. Human resource development in South Africa is lagging far behind, as illustrated by the unacceptably high levels of illiteracy.
Thirdly, enterprise development will not be possible if Government does not immediately remove the various bureaucratic and legislative obstacles that prevent the growth of small and medium enterprises. There are numerous other measures that Government, labour and business can and must undertake to encourage job creation and end poverty. [Time expired.]
Ms L M T XINGWANA: Chairperson, the topic for today is a very challenging one. We are looking at the challenges of poverty and inequality that continue to face our nation.
Okokuqala, ndifuna ukucacisa ngokuphandle ukuba ayifiki namhlanje le ntlupheko. Ayifikanga phezolo. Le ngxaki sivele saza sakhula ikho. Ivela kwimbali yeli lizwe yengcinezelo nocalu-calulo lomntu omnyama kwilizwe loobawomkhulu.
Indlala nentlupheko abaphila phantsi kwayo abantu bakowethu isuka koorhulumente bangaphambili nezizukulwana ngezizukulwana zabo, nakoonomgogwana boorhulumente abavela kubo ootata aba be-UDM, kumazwana ayesakwaziwa njengeTranskei neBophuthatswana, nazo zonke iingxaki ezazalwa ngabo.
Namhlanje ke iyeza lokuphelisa le ntlungu yesizwe ngokubanzi lilele ekubeni simanyane, sibe yimbumba yamanyama. Iinkokeli zethu zonke, ezimhlophe nezimnyama, mazizimisele ukuba ziza kujongana nawo ngokuzimisela lo mngeni. Andiyiboni into yokuba namhlanje intlupheko siyenze inzuzo yezopolitiko, ibhola yokudlala kwezopolitiko, ngenjongo yokuzuza amanqakwana ambalwa ezopolitiko kuba namhlanje iyingxaki yalo Rhulumente. Siyayazi into yokuba oohlohlesakhe bayitya yonke imali. Siyayazi into yokuba lo Rhulumente wangena kungekho nesenti engxoweni kuba iinkokeli zangaphambili zanikana izigidi ngezigidi zemali yomhlala-phantsi. Namhlanje le sele iyingxaki yoRhulumente we-ANC.
Asali ukuba ikho le ngxaki, kodwa uRhulumente sele eqalile ukuthabatha amanyathelo athile ukuzama ukuyisombulula. Into esiyicelayo yeyokuba masingazi apha size kushumayela ngentlupheko yabantu. Masizibone nazo iinkokeli zamaqela ngamaqela, afana ne-DP ne-NNP zishukuma zifaka isandla. Nankuya utata uMandela ebekufanele ukuba uphumle ekhayeni lakhe, engaphumlanga, ehlanganisa zoonke iinkampani, ookopolotyeni, iicawe naye wonke umntu ozinikeleyo kwilizwe loMzantsi Afrika ukuba enze igalelo. Bekumele ukuba sibone i-DP ithabatha inyathelo lokuhlanganisa izihlobo zayo ezifana nabalawuli benkampani yakwa-De Beer neyakwa-Anglo-American ukuze bazame ukusombulula le ngxaki yentlupheko ngokunyanisekileyo. [Uwele-wele.]
Sifuna ukuthi uRhulumente uqalisile ukuthabatha amanyathelo. Ndiye phaya kwiphondo laseMpuma Koloni. Ngoku sithethayo kukho iiprojekthi ezingama-652 zokuzama ukunqanda indlala phaya. Abona bantu baninzi bazuzayo kwezi projekthi ngoomama, ngakumbi abo basemaphandleni. Njengoko sisazi, umthamo omkhulu welaa phondo ngamaphandle. [Uwele-wele.] Oomama phaya bafuye iihagu neenkukhu, bathengisa amaqanda nenyama. Bakwafuye neebhokhwe, bekwathengisa uboya bebuthengisela namazwe angaphandle.
Bayaqala namhlanje ukuba babe nakho ukuzimela ngeenyawo zabo bangajongi kootata abaseRhawutini okanye abasemgodini. Bayakwazi ukondla abantwana, babathumele ezikolweni bahlawule neentlawulo zesikolo.
Namhlanje sineeprojekthi ezisungulwe nguRhulumente we-ANC ezingama-26, ukuzama ukudala iimeko eziza kwenza ukuba ukutya kuhlale kufumaneka. Ezi projekthi ziza kuba ngookopolotyeni okanye amalima [matsima]. Ziza kuba ziiprojekthi eziquka amaqela oomama ukususela kuma-25 ukuya ekhulwini. Aba mama baza kuqeqeshwa liSebe lezaBasebenzi neSebe lezoLimo ukuze bakwazi ukulima baze baseke amashishini ezolimo anabileyo.
Ezi projekthi sizijongile ukuba ziza kukwazi na ukunqanda indlala nokuba ziza kukwazi na ukusivelisela ukutya okuza kuhlala kufumaneka, ngakumbi emaphandleni.
Sinazo nezinye iiprojekthi phaya eRhawutini, ezilokishini zethu, kuba nalapho siyazi ukuba abantu bethu bahlupheke kakhulu kuba imisebenzi ayikho. ISebe lezoLimo phaya eRhawutini liqeqeshe oomama abangaphaya kwewaka. Umasipala wabanika umhlaba. Abakhange badlale ngawo lo mhlaba ke oomama ngoba bayawazi ukuba umhlaba yinto yokwenzani. Bayalima phaya, bondla nabantwana babo.
Abaphelelanga apho, bayathengisa nokuthengisa. La maqela sele ezimele ngeenyawo zawo. Ancedwa nje nguRhulumente ngokuthi awabonelele ngomhlaba, awafakele izixhobo zokusebenza kwanemibhobho yokunkcenkceshela. Namhlanje ezo projekthi zizimele. Ke sifuna ukuva ukuba amanye amaphondo enze ntoni na ngale ntlupheko ingaka ngoba apha sithetha ngoRhulumente we-ANC.
Ndifuna ukuqhuba ndithi, iSebe leZimbiwa naMandla nalo libabonelele ngeeprojekthi ezithile oomama. Imiselwe ngokusesikweni imanyano yoomama i- Sawima (South African Women In Mining Association). Ijongene nokuqeqesha oomama abanemigodi yabo. Namhlanje sikhululekile yaye oomama baza kukwazi ukuba nemigodi yabo. Baza kukwazi ukumba idayimani negolide ngenxa yokuba kufike uRhulumente we-ANC, uRhulumente wentando yesininzi, uRhulumente wabantu. [Kwaqhwatywa.]
Namhlanje oomama bayaqeqeshwa. Namhlanje oomama bancedwa ngemali ukuze nabo babe nokuthenga, imigodi eyeyabo. Imigodi ayizi kuba yeyakwaDe Beer kuphela. Imigodi ayizi kuba yeyakwaOppenheimer kuphela. Imigodi nomhlaba ngowethu. Itsho iFreedom Charter. [Kwaqhwatywa.]
Mandiphinde ndiqhawule ndibheke kwiSebe lezeMpilo. Eli sebe liwuthabathile umcimbi wesifo sikaGawulayo odla isizwe sonke lawusa ebantwini. Sinemibutho efana ne-Youth in Partnership Against Aids ne-Women in Partnership Against Aids. Ndiza kukhe ndihlale apha koomama.
Ngenxa yale nkqubo namhlanje oomama baqeqeshwa kumaphondo awahlukeneyo ukuba babe ngabacebisi boluntu. Abantu abagulayo nabantu abachatshazelwa sisifo sikaGawulayo bayazi ukuba bangaya kubani ekuhlaleni ukuze abaxhase abuye abacebise. Namhlanje iSebe lezeMpilo liqeqeshe oomama kwizakhono zokongiwa kwabantu abagula besemakhaya. Njengoko siyazi indlela enkulu ngayo ingxaki yentsholongwane nesifo sikaGawulayo, izibhedlele zethu azizi kukwazi ukumelana namanani abagulayo.
Kwakhona masikhumbule ukuba ihlala njalo ingumthwalo kamama into yokugula komntwana, utata nobhuti. Siyacela sikhala nakootata ukuba nabo mababe kho kwezi nkqubo zokongiwa kwabantu abagula besemakhaya, bancedise oomama ekuqeqesheni nasekongeni abantwana, oobhuti noosisi bethu abagulayo.
Le nkqubo ingunozala wentsebenziswano kwakhona, phakathi kweSebe lezeNtlalo- ntle neSebe lezeMpilo. Masikhumbule ke ukuba phambi komnyaka ka-1994 akukho mntu wayethetha ngentsholongwane nesifo sikaGawulayo apha kweli lizwe, kungekho nomntu owayeyikhathalele nokuyikhathalela loo nto. [Uwele-wele.] NguRhulumente we-ANC kuphela othabathe inxaxheba, wacwangcisa waza weza nenkqubo ecacileyo.
Okwesibini, ngokubhekiselele kule nkqubo yentsholongwane nesifo sikaGawulayo, uRhulumente wethu ufundisa oomama ngexabiso lokutya okunesondlo. Siyayazi into yokuba eYurophu naseMelika abantu abafi sisifo sikaGawulayo ngohlobo abantu abalambayo abafa ngalo apha emazweni ethu. Ngoko umcimbi wokutya okunesondlo nentlupheko unendima enkulu eyidlalayo ngokubhekiselele kwintsholongwane nesifo sikaGawulayo. Kungoko uRhulumente wethu ethe abantu mabaqeqeshwe ukuze bakwazi ukuzimela, nemizimba yabo ikwazi ukuzikhusela.
Mandigqithe apho ndiye kumba wokulingana. Ndifuna ukuthi nakuwo i-ANC ikhokele. Namhlanje sinabaphathiswa bakazwelonke abalithoba. Sivuyisana noQabane uLindiwe Sisulu, uMphathiswa wethu wezoBuntlola omtsha. (Translation of isiXhosa paragraphs follows.)
[Ms L M T XINGWANA: Firstly, I want to put it very clearly that poverty is not a new thing amongst us. It has not just started today to be part of our lives. It did not arrive yesterday. The problem of poverty existed long before we were born. When we were growing up, it was there. It is part of the history of oppression of the black person and apartheid in this country of our grandfathers.
Our people live with hunger and poverty that was inherited from the former governments and their generations, and the Bantustan governments like the Transkei and Bophuthatswana, whence the UDM members come, and all the other problems that they caused.
Today the only medicine that can stop this nation’s pain is unity. We need to unite. All our leaders, black and white, should commit themselves and face up to the challenge. I do not think that today we should use poverty for political gain and point so many fingers at this Government. We all know that the fat cats embezzled the funds. We know that when this Government came into power there were no funds because the previous leaders gave each other pension packages that amounted to millions and millions of rands. Today this is the ANC-led Government’s problem.
We do not deny that the problem exists, but the Government has started to take steps towards solving it. All that we ask for is that we should not come here to preach about the poverty that people experience. We must see the leaders of other parties, like the DP and the New NP taking initiatives and helping out. Let us look at Mr Mandela, for instance, who, instead of resting at home, is busy talking to companies, corporations, churches and everybody else who is committed to South Africa, to make a contribution. We expected that the DP would bring together all their friends and directors of companies like De Beers and Anglo-American to find solutions to the problem of poverty in earnest. [Interjections.]
The Government has started to take progressive steps. For instance, in the Eastern Cape, as we speak, there are 652 projects that are aimed at alleviating poverty, especially for women in rural areas. As we all know, a large part of that province is rural. [Interjections.] Women there breed pigs and chickens. They sell pork and eggs. They also breed goats and sell wool and some is even exported.
This is the first time in their lives that they can provide for themselves without having to wait for husbands to come back from Gauteng or the mines. They can feed their children and send them to school and pay their fees.
Today there are 26 projects that the Government of the ANC started to assist people in ways through which they can have food on the table. These will develop into corporations. They will be made up of between 25 to 100 women. These women are going to be trained by the Department of Labour and the Department of Agriculture and Land Affairs so that they can start farming and businesses for their farming products.
These projects will be closely watched to see that they meet the initial aims for which they are started, and that is to alleviate poverty and produce food continuously, particularly in the rural areas.
There are other projects in the townships of Gauteng because people are also suffering there owing to unemployment. The Department of Agriculture and Land Affairs in Gauteng trained more than a thousand women. The municipality gave them land. They did not play with that land, because they know what the land is for. They plough there so that they can produce food to feed their children. That is not the end of it. They sell some of their produce. They are self-reliant. The Government helped by giving them land and irrigation pipes. So what do we want other provinces to do when we continuously talk about poverty?
Again I want to say that the Department of Minerals and Energy started some other projects. The South African Women in Mining Association (Sawima) was launched and it is going to train women who own mines. Today we are free and women can own mines. They will be able to mine diamonds and gold because of the ANC-led Government, the democratically elected Government. [Applause.]
Today we see women being trained. Today women are funded so that they can buy their own mines. Mines will not belong to De Beers only. Mines are not going to belong to the Oppenheimers alone. The mines and the land are ours. That is in the Freedom Charter. [Applause.]
Let me go to the Department of Health. This Department took the problem of the pandemic disease, Aids, to the people. We have organisations like Youth in Partnership Against Aids and Women in Partnership Against Aids. My focus is only going to be on women.
Because of this programme women are trained to be counsellors. Sick people and those infected with Aids know about the people from whom they receive counselling. The Department of Health trained women in care-giving skills for those who are bed-ridden at home. As we know about the magnitude of the problem of HIV and Aids, our hospitals will not be able to stand up to the large number of people who become sick.
Let us also remember that if a child, a husband or a brother becomes sick, it becomes the responsibility of a woman to give care. We appeal to the men, the husbands, to be part of these programmes of caring for the ill at home and assist women in educating and caring for our children, our brothers and our sisters who are sick. This programme brings integration between the Department of Social Development and the Department of Health. Let us remember that before 1994 no one talked about HIV and Aids in this country, and no one even cared about HIV/Aids. [Interjections.] It is the Government of the ANC that took the initiative and planned a clear programme.
Secondly, considering this programme, our Government educates women about nutrition. We know that in Europe and the United States, people infected with Aids do not die in large numbers like the poverty-stricken people do in our, African, countries. So, therefore, the standard of food and poverty have great effects with regard to HIV/Aids. That is the reason our Government insists on training and educating them about caring for their bodies and protecting themselves.
Let me move on and talk about equality. I want to say that the ANC has set precedents. Today we have nine Premiers. We congratulate Comrade Lindiwe Sisulu, our new Minister of Intelligence.]
She is the first woman Minister of Intelligence in Africa. [Applause.] Sinebhongo ngoba kaloku xa umama enguMphathiswa wezoBuntlola oko kuthetha ukuba nathi sinengqondo. [Kwahlekwa.]
Ndifuna ukuthi kunyulo olugqithileyo … (Translation of Xhosa paragraphs follows.)
[We are proud, because this means that women are intelligent too. [Laughter.]
I want to say that in the last elections …]
The CHAIRPERSON OF COMMITTEES: Order! Hon member, your speaking time has expired. [Applause.]
Nksz L M T XINGWANA: Ndiyacela ke kooTony Leon ukuba balande ekhondweni leenkokeli ze-ANC, bayeke ukulawula ngegqudu besithi umntu makaphumele ngaphandle endaweni yokuba afune izimvo zabantu. [Kwaqhwatywa.] (Translation of Xhosa paragraph follows.)
[Ms L M T XINGWANA: I am appealing to Tony Leon and his own supporters to follow the lead of the ANC, and stop enforcing their interests, saying that one should step down instead of seeking out the views of other people. [Applause.]]
The CHAIRPERSON OF COMMITTEES: Order! Hon member, take your book, please. There is a pen also. Take your pen.
Mrs R M SOUTHGATE: Chairperson, our Constitution requires the state to respect, protect, promote and fulfil the rights in the Bill of Rights. Our Constitution is simply a set of principles written on a piece of paper. Unless our hands find work to do, the nation will perish irrespective of how excellent our Constitution may be. People create plenty, not just with their hearts and minds, but also with their hands. Our bodies produce the labour that manifest our dreams and discoveries into the physical world.
Visible leadership in government is an example of a strategic approach to minimise the impact of poverty. A nation’s will to tackle its problems is only as strong as the moral will of the men and women in this House to rule righteously and justly. That is the simple challenge to our perception on how to tackle the problem of poverty. If the shoes of incorruptible government fit properly on our feet, the nation will have clothes on their backs and they will create work for their hands. It is disobedience to the simple God-given truth and not simplistic theory, such as growing population, that produces poverty. It is a fact that people produce considerably more than they consume in their lifetimes.
God is a God of work and, being created in His image, we have the capacity to produce and share. That is why growing human populations, far from threatening to create poverty and exhausting natural resources, promise instead to create wealth and to multiply resources. Human creativity within a moral framework creates an endless wealth of ideas. Technology is the moral application of science to benefit mankind and creation to the glory of God. When applied to moral ends, it improves the quality of life! For instance, medicine, energy sources, agricultural advances and information explosions have all improved not just the quality of life but also the quantity.
The state has to create an enabling environment for people to gain economic and social rights through their own efforts and initiatives. We agree that everyone should at least have access to basic economic and social rights to sustain human life, health and dignity. People in rural areas need assistance from co-operative partnerships between farmers and Government to assist them to produce and grow their own food in order to survive.
The theme of alleviating poverty or addressing the needs of the poorest of the poor has been echoing through the walls of this Parliament for the past few years. It was extensively covered in the President’s speech and reflected in the budgets of various Ministries. Yet, to date, it appears as though we are fighting a losing battle and putting money into pockets with holes. Why?
Care for the poor is not a matter of logistics. No man or woman is an island, neither are we a product of accident. If we disagree, then, by careful search we will come to understand that poverty is a product of greed and selfishness. We, as a nation, can meet the challenge of poverty. South Africa can become prosperous and produce the best in the world if we allow ourselves to obey God and his precepts, work hard and care for others. Then, all will go well in our beautiful nation. [Applause.]
Dr P W A MULDER: Mnr die Voorsitter … [Tussenwerpsels.] Dit is my oupa se naam, ek is baie trots op hom. Suid-Afrika het te doen met ‘n ernstige armoedeprobleem, maar Suid-Afrika het terselfdertyd ook te doen met ‘n ernstige misdaadprobleem. Ons het te doen met ‘n ernstige gebrek aan buitelandse vertroue, wat lei tot ‘n gebrek aan buitelandse beleggings. Ons het te doen met ‘n ernstige werkloosheidsprobleem, en dit lyk of alles verskillende probleme is.
Tog, as mens gaan kyk, hou al die probleme met mekaar verband. Dit kan eintlik as ‘n bose kringloop bestempel word. Aan die een kant is daar ‘n gebrek aan nuwe beleggings, wat ons nodig het. Ons het die beleggings nodig om nuwe werk te kan skep. Omdat ons nie nuwe werk kan skep met beleggings nie, is mense arm. Armoede veroorsaak tot ‘n groot mate misdaad. Die hoë misdaadsyfer lei op sy beurt tot ‘n gebrek aan vertroue uit die buiteland en ons is terug by die begin, ons kry nie beleggings nie.
Ons moet hierdie kringloop breek, anders gaan ons nooit die probleem oplos nie. Hy kan gebreek word deur op elk van dié aspekte te konsentreer. Ons moet misdaad bekamp, ons moet vertroue in die buiteland wen, maar uiteindelik kan agb lede sien alles kom terug na arbeid, en spesifiek die arbeidsprobleem wat veroorsaak dat mense werkloos is. Ek praat hier spesifiek van arbeidswetgewing.
Natuurlik is dit waarskynlik vir die Regering die moeilikste om dié aspek aan te pak, veral vanweë sy vennootskap met Cosatu. Agb lede kan egter dink na watter kant toe hulle wil, uiteindelik eindig alles daar. Al die beperkings op ondernemers ten opsigte van arbeid veroorsaak dat ons ekonomie tans groei, maar daar word nie nuwe werkgeleenthede geskep nie.
Agb lede moet maar gaan kyk hoe, in hierdie eeu van hoë tegnologie, min handearbeid daar is wat nie met ‘n masjien of ‘n robot vervang kan word nie. Robotte staak nie, hulle vra nie oortyd betaling nie en as ons dit nie moontlik maak dat mense meer werk gaan skep nie, gaan ons al meer in ‘n kringloop beland wat dit betref.
Ek wil ook oor die landbou praat, maar my tyd raak nou min. Dit is een van die grootste werkskeppers in Suid-Afrika. Vanweë enkele gevalle is die boodskap wat boere tans kry, ook uit dié Huis, nie ‘n boodskap dat hulle welkom is nie, nie ‘n boodskap dat hulle waardeer word nie. Die boodskap dat boere onwelkom is, word voortdurend uitgestuur. Hulle skep werk, kyk maar wat in Zimbabwe gaan gebeur waar die boere nie waardeer word nie. [Tyd verstreke.] (Translation of Afrikaans speech follows.)
[Dr P W A MULDER: Mr Chairman … [Interjections.] It is my grandfather’s name, I am very proud of it.
South Africa is faced with a serious poverty problem, but at the same time South Africa is also faced with a serious crime problem. We are faced with a serious lack of foreign confidence, which leads to a lack of foreign investment. We are faced with a serious unemployment problem, and it seems as if all of these are different problems.
Nevertheless, when one looks at them, one sees that all the problems are related to one another. It could in fact be defined as a vicious circle. On the one hand there is a lack of new investments, which we need. We need the investments to create new jobs. Because we cannot create new jobs by means of investments, people are poor. Poverty causes crime to a great extent. The high crime rate in turn leads to a lack of foreign confidence and we are back at the beginning, we do not get investments.
We must break this vicious circle, or we will never solve the problem. It can be broken by concentrating on each of these aspects. We must combat crime, we must gain foreign confidence, but, as hon members can see, eventually everything comes back to labour, and specifically the labour problem, which causes unemployment among people. I am talking specifically about labour legislation here.
Of course, for the Government this is probably the most difficult aspect to tackle, especially owing to its partnership with Cosatu. Hon members may think in whatever way they prefer, eventually everything ends up there again. All the limitations on entrepreneurs in respect of labour are contributing to our economy at present growing, but no new job opportunities being created.
Hon members must go and look, in this century of high technology, at how little manual labour there is that cannot be replaced with a machine or a robot. Robots do not go on strike, they do not ask for overtime payment and if we do not enable people to create more jobs we shall be drawn deeper into a vicious circle as far as that is concerned.
I also want to talk about agriculture, but my time is running out. It is one of the largest job creators in South Africa. Because of a few cases the message that the farmers are at present getting, also from this House, is not a message that they are welcome, nor a message that they are appreciated. The message that farmers are unwelcome continues to go out. They create jobs; just look at what is going to happen in Zimbabwe where the farmers are not appreciated. [Time expired.]]
Mr P H K DITSHETELO: Chairperson, the greatest danger and threat to our fledgling democracy is an inability to address the fundamental question of poverty and inequality substantively.
There is no doubt that our country has just emerged from its ugly past, characterised by unjust apartheid laws and policies specifically designed to disempower the majority of our people. As a result, inequality was deliberately created by means of manipulating and limiting access to employment opportunities, land, education, housing, health, welfare and other basic social needs.
The resulting situation of these policies has given rise to the existing socioeconomic conditions, as characterised by the huge gap in income and wealth distribution along colour lines. It is a well-known fact that the majority of our people live in abject poverty and squalid conditions and most of them are to be found, though not exclusively, in the rural areas. The greatest challenge facing our country is to undo the effects of these past policies through dynamic and well thought-out policies aimed at creating an equal and prosperous society.
The Government has, in the past, introduced the RDP, which was widely hailed and accepted by most South Africans as a Marshall Plan, aimed at eradicating inequality and poverty. However, as we all know, the RDP policy was abandoned in favour of the controversial Gear policy. Gear, like any other policy, has its own advantages and disadvantages.
The challenge is to introduce sustainable, integrated development projects. We should also note that corruption is inimical to any meaningful development. [Time expired.]
Mrs P DE LILLE: Chairperson, the most fundamental challenge in South Africa today is to achieve a reduction in poverty and inequality. This will require substantial changes in the distribution of income, wealth and economic power between men and women, rural and urban areas, whites and blacks, and between capital and labour. Clearly, a dramatic restructuring of the economy needs to take place. The question is, how?
The past few years have seen considerable policy formulation. What is really needed now is for Government to start implementing. The process of getting water and electricity to villages, building schools and clinics, training teachers and helping people to enter into self-employment need to be accelerated.
The PAC supports a decision by Government to invest more in infrastructural development and we appeal to Government to mobilise the unemployed to build the backlog of infrastructure. Poverty and unemployment are closely linked. The unemployment rate amongst those from poor households is 55%, in comparison with a rate of 14% for those nonpoor households. Whilst more jobs are important, so are better jobs for those who are already employed.
Our Constitution is unique in its antipoverty focus. It establishes rights of access to housing, health and water, amongst other fundamental human rights, compelling the state to take reasonable measures. We appeal to the Constitutional Court to be more vigilant in enforcing these rights.
I want to agree with the hon Feinstein that poverty knows no political affiliation. Therefore, we in this House must unite and tackle the scourge. The PAC commits itself to working together with anyone who is ready and committed to eradicate poverty and inequality. [Applause.]
Mr M S MANIE: Chairperson, poverty and inequality are not things that arose after 1994. These issues are the direct results of the previous policies of the old apartheid government.
The question that arises is whether the commitment to fight poverty and inequality is only an ANC task. Judging from all the political speeches made in this House today and before, it would appear to me that all political parties have expressed the importance of fighting them. But our fight against poverty and inequality must not be confined to nice speeches. It must be reflected in practical actions and programmes that will make a meaningful difference to the lives of the poor.
Our approach, however, needs to be based on certain existing realities and not political expediency. Firstly, we have to ask: Were blacks deprived of economic, social and political participation or not, and did whites benefit materially through apartheid? But, secondly, we also have to ask whether we need white skills and whether we have gone far enough to address their concerns and fears.
Ordinary white people have the perception that the ANC Government is only concerned about black interests and that they will achieve this by taking away from the whites. These people feel very unsure about their future in the new South Africa.
Ordinary black people, on the other hand, have the perception that whites do not care about them and their needs, and that whites will do what they can to hold on to their privileges. Black people feel very frustrated. Although they now have the vote, they cannot use it to buy bread or to pay their rent. They are desperate for a better life.
Although the Government has done a great deal to address these problems, as previous speakers have mentioned, it cannot do it on its own. It requires the assistance and support of all the people of our country. What we need in South Africa is a common national agenda for all to unite behind, something that can unite all South Africans.
I am fully aware that whites feel threatened by our policies of black economic empowerment, employment equity and affirmative action. But these policies did not fall out of the air. They are direct responses to dealing with the consequences of past policies and practices.
Black economic empowerment tries to address the previous exclusion of blacks from economic power. Affirmative action deals with the question of past discrimination in the workplace and job reservation. Skills development tries do address some of the effects of Bantu education. And for the ANC to stand here, year after year, explaining why it is necessary to have these extraordinary measures to combat the legacies of the past, while the DA and other opposition parties are constantly focusing only on the negative side of our policies, only further polarises our society.
We need to move beyond the talking and get to the point of dealing with the solutions. If the measures we have taken are the wrong ones, what are the alternatives? We all seem to acknowledge that the problems are real and not perceived.
The question of economic growth should also be tackled head-on by all of us, because as long as the cake is small, it will limit the ability of the interventions that we can make. Addressing poverty and removing inequality could be one way of stimulating the economy. For instance, bringing more people into the mainstream of the economy will create a bigger domestic market which will, in turn, lead to bigger demand and an increase in the manufacturing and production activities in our country. This multiplier effect is something that is often not considered when we talk about removing poverty and inequality.
I am convinced that if we had the ability to prevent civil war, then we have the capacity in South Africa to develop a programme behind which all people in our country can unite. In my view, this national programme must focus on at least four elements. These are black expectations, of which poverty and inequality form important components, white fears, economic growth and nation-building. But the lead that all people are looking for needs to be driven by political parties in this House.
We, collectively, represent the will of the nation and the people out there. What we require is a political process that will culminate in a national programme that will be discussed between all the political players as the first step. For this programme to succeed, though, other stakeholders, such as business, labour, the religious sector and the media must also endorse it. The forum in which the Deputy President meets with the leaders of the opposition parties in this House could certainly be considered as a platform to initiate these discussions. The vision as outlined by the President in his state of the nation address forms an important basis from which to proceed.
The Budget, in the way that it had redirected resources to certain priority areas, is an important second step. I know that political point-scoring and posturing is an integral part of political life. But we will not be confronted by elections for the next two or three years, and that gives us a very important window of opportunity to thrash out details of a proposed national agenda behind which all South Africans can unite. This Parliament can and should lead in the writing of the final chapter of the South African miracle. [Applause.]
Miss S RAJBALLY: Sihlalo, ngithi kuLulu Xingwana siyabonga. Ubashayile ngolwimi lethu lwaseNingizimu Afrika. [Ihlombe.] [Chairperson, I would like to say thank you to the hon Lulu Xingwana. She surpassed everyone by speaking our South African language.] [Applause.]]
South Africa is an upper middle income country but, despite this, the relative experience of most South African households is outright poverty and the continuing vulnerability of the poor. The distribution of wealth and income in South Africa is amongst the most unequal in the world. Many households still have unsatisfactory access to education, health care, energy and clean water.
This situation is likely to affect not only the country’s social and political stability, but also the development path it follows. Policies to reduce poverty and inequality have to take into account the complementary nature of different kinds of assets and the markets where they are exchanged.
While economic growth contributes to poverty reduction, it may not necessarily reduce inequality. Several areas of Government actions are relevant to the relationship between economic growth and the reduction of poverty and inequality. This includes the allocation of state resources to social services and infrastructure, the provision of social safety nets, the promotion of social equity through the redistribution of policies involving taxation, market reforms and reprioritising expenditure, the development of good governance and administrative capacity.
The Government has already taken constructive steps to address poverty and inequalities created by past policies and systems. A mechanism to monitor the impact of policies very closely to ensure that poverty and inequality reduction is an integral part of the focus of the policies and their implementation is necessary.
The MF supports the Government’s efforts in the challenge to overcome poverty and inequality in South Africa. [Time expired.] [Applause.]
Mnr C AUCAMP: Mnr die Voorsitter, enige persoon wat nie ontroer word deur die vernietigende effek van armoede op die lewens van mense nie, moet ‘n hardvogtige mens wees. Daarom is die onderwerp vandag so belangrik. Die AEB steun die saak van die opheffing van die armes, tewens, dit is ons Christelike plig. Die vraag is dus nie of armoede en ongelykheid moet aangespreek word nie. Die vraag is: Hoe?
Laat ek eers sê hoe dit nie aangespreek moet word nie. Eerstens, moet armoede en rykdom nie oorvereenvoudig gedefinieer word ingevolge wit en swart nie, en die saak moet nie net bloot gegiet word in die vorm van ‘n tweenasieteorie nie. Die groeiende kloof begin vandag ontstaan binne-in die onderskeie rasgroepe.
Tweedens: Hoe nie? Ons moet nie op opportunistiese wyse van die saak van die armes ‘n politieke speelbal maak nie. Ons moet ook nie die politieke aspirasies probeer vervul vanuit die troostelose toestand van die armste van die armes nie. Onvervulde beloftes wat aan armes gemaak word, verhoog net die frustrasie. Deur bloot die koek anders te sny, gaan nie die probleem van armoede oplos nie. Die koek moet groter gemaak word.
Blote herverdeling deur Robin Hood te speel, verlaag en verminder die totale kapasiteit van die ekonomie totdat daar naderhand niks meer is om te herverdeel nie. Gee die behoeftige ‘n visstok eerder as ‘n vis en konsentreer sodoende op werkskepping, opvoeding en bemagtiging. Wat betref werkskepping, moet ons kyk na ons arbeidswetgewing, waardeur die totale aantal poste eenvoudig minder gemaak word.
‘n Bemagtigde mens is ‘n trotse mens. Die enigste manier waarop dit kan geskied, is deur middel van gesonde, beproefde ekonomiese beginsels, deur die ekonomie te laat groei, ‘n beleggersvriendelike omgewing te skep, behoorlike dienslewering en nie ‘n staatsdepartement wat deur onoordeelkundige regstellende optrede ontmagtig is nie. Ons moet kyk na die belange van die landbousektor wat nie net kos aan die armes voorsien nie, maar ook werk skep. Spreek die saak aan deur ‘n positiewe wen- wenbenadering. [Tyd verstreke.] (Translation of Afrikaans speech follows.)
[Mr C AUCAMP: Mr Chairperson, any person who is not moved by the devastating effect of poverty on the lives of people, must be heartless. For that reason the topic today is so important. The AEB supports the cause of the upliftment of the poor; besides, it is our Christian duty. The question is therefore not whether poverty and inequality must be addressed. The question is: How?
First let me say how it must not be addressed. Firstly, poverty and wealth must not be too simply defined in terms of white and black, and the issue must not simply be moulded in the form of a two-nations theory. Today a growing rift is beginning to develop within the various race groups.
Secondly: How not? We must not make a political football of the issue of the poor in an opportunistic manner. We must also not attempt to fulfil political aspirations out of the desolate situation of the poorest of the poor. Unfulfilled promises made to the poor merely heighten the frustration. The problem of poverty will not be solved by merely dividing the cake differently. The cake must be made larger.
Mere redistribution by playing Robin Hood, lowers and reduces the total capacity of the economy until eventually there is nothing more to redistribute. Rather give the needy a fishing rod than a fish and in this way concentrate on job creation, education and empowerment. As far as job creation is concerned, we must look at our labour legislation, through which the total number of positions is simply being reduced.
An empowered person is a proud person. The only way in which this can happen is by way of healthy, proven economic principles, by causing the economy to grow, creating an investor-friendly environment, proper service delivery and not a state department disempowered by ill-considered affirmative action. We must look at the interests of the agricultural sector which not only provides food to the poor, but also creates jobs. Address the issue by way of a positive win-win approach. [Time expired.]]
Mr A J FEINSTEIN: Chairperson, may I first thank all speakers for their participation in today’s discussion. May I also commend the hon member from the UDM on his maiden speech in this House.
I would like to thank all speakers for the constructive commitment that they enunciated to tackling poverty and inequality in our society. It was both sad and interesting to me that there was only one speaker who attempted to pull the discussion in a party-political direction. It is interesting that he was also the only speaker who has belonged to the old and the New NP. It was also interesting that, while he and I, both by the accident only of the colour of our skin at our birth, have led lives of relative comfort and privilege … [Interjections] … he omitted to mention the specific responsibility that we have in overcoming poverty and inequality.
If we, the historically privileged, lose sight of our responsibilities, we ourselves will undermine the quest for a truly nonracial society. [Applause.] Without nonracism, our struggle for liberation will always be unfulfilled. To be white in South Africa - or as some people like to refer to me, to be pale and male - does not imply that one should be uncritical. What it does require is an active engagement with our society.
It requires the use of our skills to promote the common good and a redress of the past, so that we can truly create a level playing field for our children and grandchildren. At the same time, let us all bear in mind that there are many in this House who have suffered and endured terrible and tragic things. Today, we are all, simply by virtue of the fact that we sit in this House and earn a salary every month, amongst the rich in our society.
Let us never lose sight of where we came from and what we want to struggle towards. Let us recommit ourselves, not to the fine words that we have heard here today, but to a practical, consensual and implementable programme of action that will ensure that all our children and their children grow up in comfort, prosperity and with the opportunity to fulfil their potential to its utmost. Again, I thank all members of this House for their participation in this discussion and for their close attention. [Applause.]
Debate concluded.
The DEPUTY CHAIRPERSON OF COMMITTEES: Order! This subject is concluded, but clearly, its many imperatives wait to be resolved, through us by our active intervention. That is the key challenge facing this Parliament. Let us rise adequately to that challenge and ensure that we can combat these ills in our country.
Hon members, I wish to recognise the Deputy Chief Whip of the Majority Party, who would like to present a motion without notice to the House.
ALLEVIATION OF POVERTY IN SOUTH AFRICA
(Draft Resolution)
Mr G Q M DOIDGE: Chairperson, I move without notice:
That the House -
(1) noting that it is the elected representative body of all South Africans -
(a) commits itself to uniting in alleviating poverty and reducing
inequality in general and across race and gender divides in
particular; and
(b) calls on all party leaders, and the leadership of all sectors of
our society, to meet to develop a consensual practical national
programme of action;
(2) is of the opinion that this practical programme should be -
(a) informed by -
(i) the active participation of all South Africans, driven by
our common commitment to our country and united in our
remarkable diversity; and
(ii) the need to redress the structural inequities created by
apartheid; and
(b) based on -
(i) a growing, job-creating economy;
(ii) a comprehensive rural and urban development strategy;
(iii) a holistic welfare strategy;
(iv) massive investment in physical and service infrastructure;
and
(v) immediate combined interventions by business, labour and
Government to accelerate skills development in key
economic sectors; and
(3) calls on all South Africans - black and white, rich and poor - to unite behind such a programme in the spirit of our vibrant, young democracy.
Agreed to.
The House adjourned at 16:48. ____
ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS
TABLINGS:
National Assembly:
Papers:
- The Speaker:
Petition from the Treatment Action Campaign calling on Parliament to
support the policy on and to play a proactive role in the development
of a treatment for people with HIV/Aids.
Referred to the Portfolio Committee on Health.
COMMITTEE REPORTS:
National Assembly:
- Report of the Ad hoc Committee on Report 13 of Public Protector, dated 28 February 2001:
The Ad hoc Committee on Report 13 of Public Protector, having
considered Report No 13 (Special Report): Report on the alleged
irregularities with regard to the affairs and financial statements of
the SFF Association, and on the relevant reports of the Auditor-General
to Parliament, and having heard evidence, reports as follows:
1. Introduction
(1) On 21 January 2000, Report No 13 of the Public Protector
was tabled in Parliament.
(2) The Committee was established in terms of Rule 214 of the
National Assembly, by decision of the Speaker, on 19 January
2000, which decision was ratified by the National Assembly on
21 January 2000. The Committee was established to consider
Report No 13 and to report to the National Assembly. The
Committee was formally constituted on 20 January 2000.
(3) The Committee presented its first Report to the National
Assembly on 25 February 2000, in which the Committee set out
what it understood to be its terms of reference and work
method:
"The Committee, mindful of the fact that its terms of
reference is to consider the report as a whole, proposes to
deal with the report, its findings and recommendations in a
comprehensive and holistic manner.
The Committee notes that the report deals with matters and
makes recommendations which go beyond the terms of reference
derived from the Resolution dated 21 August 1997, adopted by
the National Assembly, requesting the Public Protector to
investigate and report on the alleged irregularities with
respect to the affairs and financial statements of the SFF
Association, including, having due regard to the Report of
the Minister of Minerals and Energy and to the applicable
law, whether the reports of the Auditor-General to
Parliament thereon were correct and proper. This adds to the
complexity of the Committee's task.
In pursuance of its approach, the Committee will consider,
when necessary, calling evidence on the findings and matters
contained in the report and on the extent to which the
recommendations contained in the report have been
implemented.
The Committee may further consider referring matters arising
from the report to structures best suited to deal with them.
Mindful of the need to deal with these matters as
expeditiously as possible, but also mindful of the scope,
range and complexity of the matters dealt with in the Public
Protector's report, the Committee is of the opinion that it
will require a period of at least three calendar months,
from the date of adoption of this Report, to complete its
work, provided that the Committee may need to approach the
House with a view to extending this period, if necessary".
(4) The Committee has taken considerable time in completing
its work, both due to the complexity of the matters it was
asked to deal with as well as lengthy recesses in Parliament's
schedule during an election year.
(5) The Committee has considered the report of the Public
Protector and has also considered written and oral submissions
by the Public Protector, presented at public hearings held on
4 and 18 April 2000.
(6) The Committee would like to express its sincere gratitude
to the Public Protector, Adv S A M Baqwa SC, and the staff in
his Office, for the assistance they provided to the Committee,
and the very cordial and constructive manner in which it was
able to interact with them.
(7) The Committee is pleased to submit its final Report to the
National Assembly.
2. Report of Public Protector
(1) The Committee would like to express its appreciation to
the Public Protector for the investigation conducted by his
Office and the comprehensive report that has been submitted to
Parliament.
(2) On 21 August 1997 the National Assembly adopted the
following resolution which constituted the terms of reference
of the Public Protector:
"That the House resolves to request the Public Protector, in
terms of section 182(1)(a) and (b) of the Constitution, 1996,
to investigate, and to report to the National Assembly on, the
alleged irregularities with regard to the affairs and
financial statements of the SFF Association, including having
due regard to the Report of the Minister of Minerals and
Energy and to the applicable law, whether reports of the
Auditor-General to Parliament thereon were correct and
proper".
(3) The investigation conducted by the Public Protector
spanned an extensive period. There were 25 000 pages of
written evidence and extensive oral evidence presented to the
Public Protector. Parties who had an interest in the
investigation were represented by senior legal teams.
In his submission to the Committee the Public Protector
addressed the question of the money and time spent on this
investigation and indicated that the investigation was fully
justified in view of the fact that the SFF Association was a
wholly-owned government company worth more than R13 billion.
He indicated that the money spent was mainly in the form of
legal fees incurred by interested parties. He concluded that
he believed that every cent spent was well worth it.
3. Findings of Public Protector
The findings of the Public Protector can be summarised as follows:
(1) General approach
The Public Protector took the following approach with his
investigation:
The key driving force to this investigation was to protect the
public interest. When it appeared that no loss had occurred,
he had to weigh whether the benefit of investigating further
would be justified by the cost of the investigation. He did
not investigate matters which had been dealt with elsewhere or
in other investigations. He also did not investigate matters
which would not have been of practical benefit to the public.
(2) Change in accounting policy (R170 million issue)
(a) During the 1992-93 financial year, the Strategic Fuel Fund
Association (SFF) Management decided to change the
accounting policy relating to strategic oil stock that
had been sold from one storage facility and replaced
elsewhere, during the previous three years. This change
in accounting policy gave rise to a R170 million loss,
which the former Minister of Minerals and Energy Affairs,
Dr P M Maduna, referred to in his responses to questions
in Parliament. The Minister indicated that this was
possibly a physical loss to the SFF.
(b) During the initial hearings in June 1998, Counsel for the
Minister put on record that the R170 million was not a
physical loss, as the Minister had indicated in his
responses in Parliament, but an accounting loss caused by
the change in accounting policy.
Considering and evaluating the accounting policy change
was only necessary for as long as it appeared that the
R170 million was a physical loss. Given that there was no
physical loss associated with the change in accounting
policy, the Public Protector therefore made no finding
regarding the reasonableness of the change in accounting
policy and its disclosure (see also paragraph 4(6)
below).
(3) Payments to Interstate
(a) The SFF contracted directly with the Egyptian General
Petroleum Corporation (EGPC) to purchase Egyptian crude
oil in 1992. Prior to this date, due to sanctions, the
SFF had effectively purchased Egyptian crude oil through
a company called Interstate, paying Interstate a margin
for this service, as was normal practice at the time.
(b) The SFF continued to pay Interstate a reduced margin
(US$ 0,06 a barrel) on all oil purchased through EGPC
after 1992. Interstate paid the SFF US$ 0,05 a barrel if
they, instead of the SFF, lifted the oil under the
contract.
(c) Allegations were made that the payments to Interstate were
of no value and were perhaps improper or fraudulent.
(d) Evidence showed that the payments were made for the
effective relinquishing to SFF of Interstate's Egyptian
oil contract volumes with EGPC, as EGPC did not have
additional oil volumes to contract with the SFF, without
Interstate giving up their volumes. Interstate also
provided ad hoc logistical services, but these were not
the main causa for the payments to Interstate.
(e) Whilst there were many deficiencies in the documentation
of the contract with Interstate, which gave rise to the
suspicions of impropriety, the Public Protector finds
that there was a valid reason or causa for the payments
to Interstate. It is, however, equally true that the
benefit received for the payments to Interstate reduced
or weakened over the years as the oil procurement
environment improved.
(4) Salem recovery
(a) Allegations were also made with regard to the R1 450
million payment by SFF to the Government in April 1997,
and the incorrect posting in the books of SFF of moneys
recovered from the Salem oil tanker incident.
(b) Whilst the Public Protector needed to investigate these
allegations and covered these issues in the report, he
regarded it as common cause that no losses arose from
these issues. As such these issues did not form the
primary focus of his investigation.
(5) Auditor-General's Report to Parliament
Audit of SFF
(a) The general allegation was that the audits of the SFF by
the Auditor-General and his agent, Price Waterhouse,
should have identified the problems with regard to the
contract underlying the payments to Interstate (referred
to as the Six Cents Agreement) and the other alleged
irregularities.
(b) The Public Protector indicates that Parliament
specifically requested him to look at the alleged
irregularities and therefore he considered the audit
process only in so far as it related to the alleged
irregularities noted above.
(c) Given that he found that there was a valid causa for the
Interstate payments and that the issue regarding the
change in accounting policy did not cause an actual loss,
he found no basis on which the audit of the SFF could be
criticised for not identifying these issues.
(d) The main criticism of the Auditor-General's reporting to
Parliament was that the 1992-93 management financial
statements, which in previous years had not been
published, were published for the first time in 1992-93
in an abridged format. The abridged financial statements
summarised the management financial statements and did
not separately disclose the R170 million relating to the
change in the accounting policy.
(e) The argument was that the secrecy provisions, which had
previously restricted the publishing of crude oil
information, were sufficiently relaxed to allow full
publication of the financial statements. The allegations
went further to imply that the abbreviation had occurred
to cover up the R170 million loss.
(f) Based on the evidence the Public Protector finds that it
appears that the Auditor-General (who had the discretion
after consultation to decide what information to publish)
in fact published the SFF information much earlier than
he was required to do. In addition he finds that whilst
there were minor technical difficulties with the
abbreviated 1992-93 financial statements, they could not
be said to be misleading or inappropriate.
(g) While the Committee accepts the findings of the Public
Protector outlined above, it wishes to draw the attention
of the National Assembly to the following matters:
(i) The CEF Group and the SFF Association were
instrumental in attempts by the Apartheid State to
break the international oil embargo imposed by the
United Nations in protest against Apartheid.
(ii) As such these organisations operated behind a veil
of secrecy and conducted operations that were, by
definition, in contravention of international law.
(iii) The structure and functioning of the SFF was
such that it made political and administrative
accountability difficult.
(iv) There are certain allegations, in particular
concerning the diversion of funds from the SFF for
political purposes, that the Committee is not
necessarily satisfied were isolated incidents. The
Committee is of the view that a forensic
investigation into such matters would have been in
the public interest.
(v) During the course of its work further allegations of
irregularities in the operations of the SFF
Association were reported.
(vi) The Committee wishes to state that, if the
accounting policy was adequately discussed with and
explained to the Minister and the National
Assembly, much of the misunderstanding could have
been avoided.
(6) Findings regarding actions of Minister
The Public Protector makes the following findings regarding
the actions of the Minister:
(a) The Public Protector finds that the Minister's statements,
both in Parliament and outside Parliament, were
tantamount to suggesting that the Office of the Auditor-
General had either covered up the loss of R170 million or
that he had not done his duty properly by ascertaining
and disclosing that such a loss had occurred. The Public
Protector finds that this unfortunate impression could
easily have been dispelled by an appropriate consultation
with his Management Auditor or by a direct in-depth
discussion with the Auditor-General himself. Even though
there were meetings between the Minister and the Office
of the Auditor-General, it did not seem to him that they
were in the spirit of section 181 or section 41(1), which
provides as follows:
"(1) All spheres of government and all organs of State
within each sphere must -
(a) preserve the peace, the national unity and the
indivisibility of the Republic;
(b) secure the well-being of the people of the Republic;
(c) provide effective, transparent, accountable and
coherent government for the Republic as a whole;
(d) be loyal to the Constitution, the Republic and its
people;
(e) respect the constitutional status, institutions,
powers and functions of government in the other
spheres;
(f) not assume any power or function except those
conferred on them in terms of the Constitution;
(g) exercise their powers and perform their functions in
a manner that does not encroach on the geographical,
functional or institutional integrity of government
in another sphere; and
(h) co-operate with one another in mutual trust and good
faith by -
(i) fostering friendly relations;
(ii) assisting and supporting one another;
(iii) informing one another of, and consulting one
another on, matters of common interest;
(iv) co-ordinating their actions and legislation
with one another;
(v) adhering to agreed procedures; and
(vi) avoiding legal proceedings against one another
..."
(b) With regard to protection of institutions, functional or
institutional integrity, fostering good relations,
supporting one another, consulting one another and
adhering to agreed procedures, the Public Protector finds
that the Minister violated the spirit of the Constitution
by not upholding the principles and prescripts contained
particularly in the quoted sections of the Constitution.
Adherence thereto would have led to the immediate
rectification of any incorrect perception which the
Minister might have had.
(c) The Public Protector indicates that he has not suggested
and he does not suggest that the Minister acted mala
fide. None of the evidence presented before him suggested
that the Minister had any bone to pick with the Office of
the Auditor-General prior to the reports he received
which led to the Management Audit. The Public Protector
finds that the Constitution can be transgressed even if
the Minister's allegations were made bona fide and had
been correct.
(d) The Public Protector holds that the Minister is duty-bound
to uphold the constitutional principles and follow
correct procedures at all times, and that it is
absolutely imperative for all South Africans, both in and
outside Parliament, to accept the consequences of the
Constitution, which is the supreme law of the land. One
of those consequences is to uphold and protect the
dignity, the integrity and independence of the
institutions mentioned in Chapter 9 of the Constitution.
(e) The Public Protector points out that neither section 181
nor section 41 provides any sanction for their
transgression, and that he is not possessed of any power
to prescribe such sanctions. He regards this as a
constitutional weakness that can only be remedied by
Parliament itself. Parliament has to provide such remedy
because he considers these matters to be serious enough
"not even to be adequately addressed by a simple
apology". Parliament therefore needs to devise a
mechanism with which to deal with such matters when they
arise. This is necessary also to endorse not only the
fact that the Constitution is a living document, but also
one that is effective. The public needs to be assured
that the Constitution is not a document of mere words.
(f) The Public Protector points out that the Minister is a
Member of Parliament and a Member of the Cabinet, and in
this regard section 92 of the Constitution provides as
follows:
"(2) Members of the Cabinet are accountable collectively
and individually to Parliament for the exercise of their
powers and the performance of their functions.
(3) Members of the Cabinet must -
(a) act in accordance with the Constitution; and
(b) provide Parliament with full and regular reports
concerning matters under their control."
(g) The Committee is of the view that the National Assembly
has already found that the Minister acted in
contravention of the then Rule 99 (now Rule 66) by
reflecting upon the competence or honour of the Auditor-
General, and that the remarks were not in keeping with
the spirit of sections 181 and 41 of the Constitution.
(h) The Committee deals more extensively with matters relating
to sections 181 and 41 under paragraph 5(4).
4. Recommendations by Public Protector
The recommendations contained in the Public Protector's report can
be summarised as follows:
(1) With regard to the failure to record the Six Cents
Agreement with Interstate in writing, and the issues raised
with regard to the causa for the payments to Interstate, the
Public Protector found it to be untenable that the causa for
the payments was not recorded in the facsimile of 2 July 1992
and that the term contract was not in writing in accordance
with the Company Policy R02. It was found that the policy with
regard to term contracts, namely that they had to be in
writing, was a salutary one, and that all contracts should be
formalised and authorised at the appropriate levels, as a
written contract would probably have gone a long way to allay
the suspicions that had arisen around the US$ 0,06 payments to
Interstate. It was also found to be unacceptable that this
matter was not addressed by internal controls such as Internal
Audit, which is an indication of a material defect in the
organisational structure.
Strict application of the written contracts policy is
therefore recommended, and this has to be drawn especially to
the attention of Internal Audit of SFF, and specifically
incorporated as one of the imperatives into the rules and
regulations in terms of which they approve payments.
(2) With regard to the absence of reference in minutes of the
Board/Crude Oil Committee for 1992 and 1993 to the Six Cents
Agreement with Interstate, and the fact that minutes of the
Crude Oil Committee meetings were kept by a member of the
crude oil department, and not by the regular Board secretary,
it was noted that no relaxation or laxity of standards should
be tolerated in any State entity, and in particular one which
deals in billions of rands on behalf of the tax payer. The
Public Protector took it that minuting is now undertaken by a
competent person trained to do so. If not, it is recommended
to the Board of the SFF that this be effected. It is also
recommended that the Directors and committee members, when
checking minutes, ensure that these fully record the matters
of importance with regard to the management of the business as
well as key decisions in this regard.
(3) With regard to the issues arising from the alleged absence
of Board approval for the EGAM contract and the level of
authorisation needed for an evergreen contract, it was noted
that contracts longer than a year should go to the Board. As
an evergreen contract is intended to last for more than a
year, it is recommended that evergreen contracts also be
reviewed by the Board in future.
With reference to the delay in bringing the EGAM contract to
the attention of the Board, it is recommended that such delays
be strongly discouraged, since it is improper not to keep the
Board informed at all times.
(4) With regard to the Ivory Coast payment, it appears to have
been an isolated incident representing a classic case of
political manipulation of a state-owned company for political
gain. It is indeed hoped that this case represents an
aberration which will never be repeated within the CEF group
or any similar organisation. It is a lesson about what ought
never to be allowed to happen by all State institutions and
para-statals.
(5) With regard to the Salem issue, and the incorrect posting
of monies received: This practice should be deprecated as
inappropriate. Though it did not have any practical negative
consequences, it ought not to have been done and reflects a
practice that should not be repeated in the future.
(6) With regard to the change in accounting policy, the Public
Protector is of the opinion that the processes followed and
the expertise utilised in considering the change and its
disclosure, were reasonable. However, should there still be
concerns, the Public Protector states that the Minister is
entitled to request the Board to review the matter further and
to obtain further expert advice.
(7) With regard to the old Company Policy R05, which was
silent on whether funds for return cargoes should be retained:
The new policy is explicit that the funds must be set aside
from the original sale. Therefore the Public Protector has no
further recommendation in this regard, other than to say that
this is more desirable. As it was common cause that there was
no actual cash shortage caused by these payments (cash
transfers to the Government based on oil sales which had not
yet occurred), and in view of the fact that the cash flow
forecasts are subjective projections into the future, the
Public Protector did not go into too much detail on the
various cash flow forecasts prepared and the differences
between them. It is recommended, however, that if a cash flow
shortage is forecast, even a short-term one, this should be
clearly communicated to the Board so that the matter can be
addressed in whatever manner deemed appropriate by the Board.
(8) With regard to company policy on whether strategic oil
reserves should be held in wet or paper barrels, the Public
Protector is of the opinion that Company Policy R02 was in
fact not complied with, as 11 million barrels were held in
paper barrels. Consequently the required reserves were below
the minimum standard required at the time. At that stage (31
March 1997) the breach of policy did not have any serious
consequences for the SFF or South Africa. In saying so, he
does not seek to justify the aforementioned breach, which
potentially could have had serious consequences for the
country. Such breaches of company policy should never be
countenanced or allowed to occur in future.
(9) With regard to the Interstate payments, the change in
accounting policy and the R1 450 million payment to the
Government, and the allegations raised by NSN that the General
Manager acted without the appropriate authority and knowledge
of the Board, and did not provide them with adequate
information regarding the key issues: The position would have
been different had the SFF had both Executive and Non-
Executive Directors, in that the flow of information would not
have been open to potential limitations by one person as was
alleged.
The Public Protector therefore recommends that SFF and other
similar Government organisations should have a Board of
Directors consisting of Executive and Non-Executive Directors,
as suggested by the King Report. This would not necessarily
require additional people. It would be expected that the non-
executive Board would remain, but that the General Manager and
Deputy General Managers be appointed Executive Directors. This
would prevent the Board being dominated by an individual or
individuals whilst ensuring that it is fully informed on all
matters at all stages. The Chairperson would, however,
continue to be independent and non-executive.
(10)With regard to other Corporate Governance issues: The Public
Protector is of the view that State institutions should form
the model for good Corporate Governance. Whilst these
institutions do not always operate in the same way as a normal
business, the Corporate Governance principles outlined in the
King Report are still applicable. Given the highlighting of
fraud in business today, it is vital that as part of this
Corporate Governance fraud be specifically addressed. It is
therefore recommended that all State institutions should have
a finalised fraud strategy as part of their overall strategy,
which should include the following:
(a) How fraud risks will be assessed on an ongoing basis.
(b) An ongoing methodology for ensuring that the controls in
place correctly identify, deter and prevent fraud.
(c) A fraud response plan to ensure that any fraud detected is
responded to appropriately.
(d) Specific responsibilities for ensuring that the fraud
strategy is implemented and followed up on an ongoing
basis.
(11)With regard to the interaction between the Minister and the
Auditor-General, the Public Protector states that he found the
Minister's conduct in regard to the accusations made with
regard to the implied cover-up of a loss of R170 million by
the Auditor-General to be unacceptable. In this regard, he
recommends that not only the Minister, but all officials of
the State, should take heed of the prescribed relationship
between institutions and organs of State as spelt out in the
Constitution. Section 41(1) and section 181 of the
Constitution specifically deal with this. Section 41 provides
that organs of State must respect the constitutional status,
the one of the other. They must not exercise their powers in a
manner that encroaches on the institutional integrity of
another. It furthermore provides that organs of State should
co-operate with one another in mutual trust and good faith by
consulting one another on matters of common interest, and
adhering to agreed procedures. The correct channels and
procedure must be followed when addressing concerns one might
have about a Chapter 9 institution. The Public Protector
accordingly recommends that the Speaker of the National
Assembly takes the necessary steps to ensure that not only
this report, but also, more specifically, matters regarding
sections 181 and 41 of the Constitution, be raised in the
Legislature with a view to a pronouncement regarding the
accountability of the Minister and any possible sanction which
the Legislature might consider appropriate.
5. Recommendations of Committee
The Committee considered the above recommendations and wishes to
recommend to the National Assembly, as follows:
(1) Matters relating to corporate governance of SFF
That the recommendations contained in paragraphs 4(1), 4(2),
4(3), 4(4), 4(5), 4(7), 4(8), 4(9) and 4(10) be referred to
the Portfolio Committee on Minerals and Energy, the Committee
to consider these matters and to report to the National
Assembly.
(2) Matters relating to corporate governance of public
enterprises
That the recommendations contained in paragraphs 4(4), 4(9)
and 4(10) be referred to the Portfolio Committee on Public
Enterprises, the Committee to consider these matters and to
report to the National Assembly.
(3) Matters relating to public service and administration
That the recommendations contained in paragraph 4(10) be
referred to the Portfolio Committee on Public Service and
Administration, the Committee to consider these matters and to
report to the National Assembly.
(4) Matters relating to sections 181 and 41 of Constitution
(a) The Public Protector points out that neither section 181
nor section 41 of the Constitution provides any sanction
for their transgression. This is held to be a
"constitutional weakness" that can only be remedied by
Parliament itself. These matters are considered to be
serious enough "not even to be adequately addressed by a
simple apology".
(b) The Committee concurs with the Public Protector regarding
the importance of the institutions supporting democracy
created in Chapter 9 of the Constitution and their role
in supporting democracy and human rights, and
consequently the need for the independence, impartiality,
dignity and effectiveness of these institutions to be
protected.
(c) The Committee agrees with the Public Protector that the
Constitution does not provide for sanctions for the
contravention of sections 181 and 41(1) of the
Constitution. However, the Committee does not wish to
express itself on whether this constitutes a
"constitutional weakness" in view of the fact that
section 181 of the Constitution itself provides that
"other organs of State through legislative and other
measures must assist and protect these institutions to
ensure the independence, impartiality, dignity and
effectiveness of these institutions." (Committee's
emphasis.)
(d) The Committee recommends that these matters be referred to
the Constitutional Review Committee and the Portfolio
Committee on Justice and Constitutional Development, the
committees to consider the above matters and to report to
Parliament.
6. Accountability of Minister and appropriate sanction
(1) The Public Protector recommends that Parliament make a
pronouncement regarding the accountability of the Minister and
any possible sanction which Parliament might consider
appropriate.
(2) In considering the above recommendation, the Committee
considered the following factors:
(a) The process of pronouncing on accountability and sanctions
is a judicial or quasi-judicial one that would entail,
inter alia, adherence to the principles of natural
justice. This clearly fell outside the mandate of the
Committee. The Committee was not constituted as a
disciplinary committee.
(b) The National Assembly has already found that the Minister
acted in contravention of the then Rule 99 (now Rule 66)
by reflecting on the honour and integrity of the Auditor-
General other than by way of substantive motion and
ordered him to withdraw his statements and to apologise.
The Minister duly apologised unreservedly and
unconditionally retracted his remarks on 4 September
1998. The Committee cannot concur with the assertion by
the Public Protector that the Minister apologised but did
not retract his statements. Hansard and the Minutes of
the National Assembly reflect otherwise.
(c) The Supreme Court of Appeal stated, per Mohammed, CJ, in
the matter of The Speaker of the National Assembly vs De
Lille and Another 1999 (4 SA 863 SCA), that -
"This enquiry must crucially rest on the Constitution of
the Republic of South Africa, Act 108 of 1996. It is
Supreme - not Parliament. It is the ultimate source of
all lawful authority in the country. No Parliament,
however bona fide or eminent its membership, no
President, however formidable be his reputation or
scholarship, and no official, however efficient or well-
meaning, can make any law or perform any act which is not
sanctioned by the Constitution. Section 2 of the
Constitution expressly provides that law or conduct
inconsistent with the Constitution is invalid and the
obligations imposed by it must be fulfilled. It follows
that any citizen adversely affected by any decree, order
or action of any official or body, which is not properly
authorised by the Constitution is entitled to the
protection of the Courts. No Parliament, no official and
no institution is immune from Judicial scrutiny in such
circumstances." (p 868-9.)
"There is therefore nothing in the "Rules and orders" of
the Assembly which qualifies, in any respect relevant to
the appeal, the right to freedom of speech in the
Assembly which s58(1) guarantees. More directly, there is
nothing which provides any constitutional authority for
the Assembly to punish any Member of the Assembly for
making a speech through an order suspending such Member
from the proceedings of the Assembly. The right of free
speech in the Assembly protected by s58(1) is a
fundamental right crucial to representative government in
a democratic society. Its tenor and spirit must conform
to all other provisions of the Constitution relevant to
the conduct of proceedings in Parliament." (p 874.)
(Committee's emphasis.)
The judgment states that section 57 of the Constitution
"provides that the National Assembly 'may determine and
control its internal arrangements, proceedings and
procedures'. There can be no doubt that this authority is
wide enough to enable the Assembly to maintain internal
order and discipline in its proceedings by means which it
considers appropriate for this purpose. This would, for
example, include the power to exclude from the Assembly
for temporary periods any member who is disrupting or
obstructing its proceedings or impairing unreasonably its
ability to conduct its business in an orderly or regular
manner acceptable in a democratic society. Without some
internal mechanism of control and discipline, the
Assembly would be impotent to maintain effective
discipline and order during debates." (p 869.)
(Committee's emphasis.)
(3) In view of the above the Committee recommends that it
would not be appropriate to make a pronouncement on an
appropriate sanction in the instant case.
(4) The Committee recommends that these matters be referred to
the Rules Committee of the National Assembly to consider any
amendments to the Rules of the National Assembly and/or the
Powers and Privileges of Parliament Act that might be
appropriate, the Committee to report to the National Assembly.
The Committee recommends accordingly.
Report to be considered.
-
Report of the Portfolio Committee on Social Development on the Developmental Welfare Governance Bill [B 43 - 2000] (National Assembly - sec 75), dated 28 February 2001:
The Portfolio Committee on Social Development, having considered the subject of the Developmental Welfare Governance Bill [B 43 - 2000] (National Assembly - sec 75), referred to it and classified by the Joint Tagging Mechanism as a section 75 Bill, reports the Bill with amendments [B 43A - 2000] (Advisory Board on Social Development Bill [B 43B - 2000]).