TUESDAY, 8 MAY 2001 __

          PROCEEDINGS OF THE NATIONAL COUNCIL OF PROVINCES
                                ____

The Council met at 14:05.

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

ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS - see col 000.

                        WELCOMING OF MEMBERS

The CHAIRPERSON OF THE NCOP: Order! Hon members, welcome back from your leave and constituency period. It must have been a most exciting period, because I see you had a great deal to discuss among yourselves, hence we could not begin when we should have begun. I would ask that when we begin sittings hon members ensure that we can start on time.

                          NOTICES OF MOTION Dr P J C NEL: Chairperson, I give notice that at the next sitting I will move:

That the Council -

(1) takes note -

   (a)  of a report on sexual violence against girls in South African
       schools, compiled and published by Human Rights Watch, an
       organisation dedicated to protecting human rights around the
       world which recently visited eight schools in three provinces of
       South Africa and conducted detailed interviews with 36
       schoolgirls between the ages of 13 and 18 years about their
       experiences with sexual violence and harassment; and


   (b)  of the horror stories told by these poor girls of the merciless
       way in which they had been tortured and raped by schoolteachers,
       and some gang-raped by male classmates;

(2) further notes that the report -

   (a)  states clearly what a devastating and profoundly destabilising
       effect this kind of violence has on the lives of the victims,
       not only physically but also psychologically;


   (b)  emphasises the fact that violence against women in South African
       society is widely recognised to have reached levels amongst the
       highest in the world and that, if the Government tolerates this
       kind of violence in schools, children will learn to accept this
       kind of violence as legitimate; and


   (c)  further states that to end sexual violence South African schools
       will require national leadership and guidance and that more
       Government action is definitely needed at this level; and

(3) requests the Minister of Education to implement, as soon as possible, the recommendations relating to this matter made in this report to the Government.

Mr N M RAJU: Chairperson, I give notice that at the next sitting of this House I shall move: That the Council -

(1) notes with horror and dismay that St Lucia ranger Henry Oram, aged 38 years, was mercilessly gunned down by unknown assailants on Friday, 4 May 2001, on the N2 just north of Mtubatuba, at the turn-off to the Umfolozi Game Reserve;

(2) notes that the award-winning antipoaching officer with KwaZulu-Natal Wildlife was at the forefront of a major probe believed to involve powerful syndicates in the smuggling of fish and prawns from Lake St Lucia;

(3) further notes that the unfortunate officer had been driving his own private vehicle and was dressed in civilian clothes as he had arranged to meet an informer on the national N2 highway, but obviously had been set up by those to whom he had become a threat in pursuance of their nefarious activities; and

(4) calls on the Ministry of Safety and Security to leave no stone unturned in hounding out these miscreants in society who seem bent on pursuing their criminal agendas with impunity and capricious disdain, thereby giving South Africa a bad name internationally, especially when one considers that the St Lucia wetlands have only recently been declared a World Heritage Site, attracting worldwide attention.

               FAILURE OF PRESIDENT TO ADDRESS MEETING

                         (Draft Resolution)

Ms C BOTHA: Madam Chair, I move without notice:

That the Council -

(1) notes that President Thabo Mbeki failed to attend and address a Daimler Chrysler board meeting on 7 May 2001, to which he was invited in his capacity as head of state, and where former United States President George Bush was present as a guest;

(2) also notes that this is the second time he has failed to arrive at a function hosted by Jurgen Schrempp, member of his International Economic Advisory Council and CEO of Daimler Chrysler, who has just invested R1,4 billion in East London and is the person appointed by the German Chancellor as chairman of the Southern African initiative on German business, and who has been truly committed to canvassing foreign direct investment in South Africa;

(3) further notes that President Mbeki did not address the meeting ``on account of urgent work commitments’’; and

(4) expresses its grave concern about the impact that this pattern of behaviour will have on a country struggling to attract foreign investment, as well as its concern about the President’s puzzling evaluation of priorities.

[Interjections.]

The CHAIRPERSON OF THE NCOP: I am fully aware of the procedures, hon members. Is there any objection to the motion? There are objections. The motion will therefore become notice of a motion.

  ALLEGED MISAPPROPRIATION OF GOVERNMENT HOUSING BY MAYOR'S FAMILY

                         (Draft Resolution)

Mr T S SETONA: Madam Chair, I move without notice:

That the Council -

(1) notes with concern the allegations around the misappropriation of a government housing complex in the unicity by family members of the unicity mayor, Peter Marais;

(2) further notes that his family members have been allocated flats, despite the fact that many of them own their own houses and are subletting the flats in exchange for rentals;

(3) expresses its concern over the fact that people who have adequate accommodation have been given priority in the allocation of flats while the province struggles with a severe housing shortage;

(4) believes that this situation raises serious questions about the activities of Mr Marais while he was still the MEC for housing in the Western Cape government; and

(5) calls on the provincial government to investigate whether Mr Marais’ family unfairly benefited from the allocation of flats by virtue of Mr Marais’ position as former MEC for housing or as the present unicity mayor.

The CHAIRPERSON OF THE NCOP: Is there any objection to the motion? There is an objection. The motion will therefore become notice of a motion. [Interjections.]

Order! I have always been very concerned at the reaction Mr Marais evokes in this House. Could members please behave?

         INVESTIGATION INTO GOVERNMENT ARMS PROCUREMENT DEAL

                         (Draft Resolution)

Mrs J N VILAKAZI: Chairperson, I move without notice:

That the Council -

(1) welcomes the commitment by the Public Protector, the National Director of Public Prosecutions and the Auditor-General to transparent investigations into the Government’s arms procurement deal;

(2) calls on them to work with a sense of urgency to ensure a speedy, yet comprehensive resolution of the investigation in order to bring an end to the current trial by the media; and

(3) also calls on all individuals and institutions that might have information that may assist the investigation to forward it to the investigating agencies.

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

      INVOLVEMENT OF PRESIDENT IN MIDDLE EAST PEACE INITIATIVES

                         (Draft Resolution)

Prince B Z ZULU: Chairperson, I move without notice:

That the Council -

(1) extends its congratulations and gratitude to the President of our country, who has been asked by the Nonaligned Movement Ministerial Committee on Palestine to get involved both in his capacity as -

   (a)  chairman of the movement; and


   (b)  President of South Africa;

(2) notes that this initiative follows an announcement by the Palestinian leader, Yasser Arafat, of his commitment to peace;

(3) welcomes the strength and commitment by our President in order to achieve just, durable and comprehensive peace in the Middle East; and

(4) highly appreciates the call by the movement in showing confidence, trust and respect to South Africa as a country and to the President specifically. Motion agreed to in accordance with section 65 of the Constitution.

              SITUATION AT DURBAN CHILD PROTECTION UNIT

                         (Draft Resolution)

Mr P A MATTHEE: Chairperson, I hereby move without notice:

That the Council -

(1) takes note that -

   (a)  according to a media report the Durban Child Protection Unit
       yesterday stopped all investigations to protest against drastic
       staff shortages;


   (b)  in a petition signed by more than 70 percent of the members of
       the unit, management is asked to consider the grievances and to
       appoint a commissioner who would be suitable to address the
       problem;


   (c)  according to a spokesperson the average case load for a
       detective at the unit is between 70 and 80 at any given time,
       the lowest case load is 50 and the highest 104 and that
       collectively they are investigating more than 2000 child abuse
       cases;


   (d)  the members also complained that staff were no longer being paid
       standby allowances or overtime for after hours call duties, and
       that there is also a shortage of stationery and transport, which
       is vital for the unit to function; and


   (e)  it is impossible for members of the said unit to give individual
       attention to child abuse cases because of the high workload;

(2) therefore urges the Government to afford the protection of the safety and security of the children of Durban, KwaZulu-Natal, and of all the children of South Africa the high priority that it deserves; and

(3) furthermore requests the Minister of Safety and Security to urgently give attention to the current problems at the Durban Child Protection Unit and to report as soon as possible to the Council on the steps that have been taken to resolve the situation in Durban and on the situation in respect of case loads, staff, stationery and transport at other child protection units in the country, as well as in respect of the investigation of child abuse cases in police areas where there are no child protection units.

The CHAIRPERSON OF THE NCOP: Is there any objection to the motion?

Mr J L MAHLANGU: Chairperson, I would like to make some additions to the motion by moving as an amendment:

That the following paragraphs be added after paragraph (3):

(4) acknowledges the fact that police members across the country are working under difficult circumstances;

(5) however, expresses its reservations around the use of strike action as a means of achieving their objectives because - (a) it does not assist the victims of crime; and

   (b)  the Government, by way of the Minister of Safety and Security,
       has already committed itself to improving the working conditions
       of police members across the country;

(6) commends those policemen and women who, despite their difficult working conditions and high case loads, continue to provide an excellent service to their respective communities; and

(7) resolves to make every effort to ensure that the commitments made by the Minister of Safety and Security are translated into practice sooner rather than later.

Mr P A MATTHEE: That amendment is fine, Chairperson.

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

Motion, as amended, agreed to in accordance with section 65 of the Constitution, namely: That the Council -

(1) takes note that -

   (a)  according to a media report the Durban Child Protection Unit
       yesterday stopped all investigations to protest against drastic
       staff shortages;


   (b)  in a petition signed by more than 70 percent of the members of
       the unit, management is asked to consider the grievances and to
       appoint a commissioner who would be suitable to address the
       problem;


   (c)  according to a spokesperson the average case load for a
       detective at the unit is between 70 and 80 at any given time,
       the lowest case load is 50 and the highest 104 and that
       collectively they are investigating more than 2000 child abuse
       cases;


   (d)  the members also complained that staff were no longer being paid
       standby allowances or overtime for after hours call duties, and
       that there is also a shortage of stationery and transport, which
       is vital for the unit to function; and


   (e)  it is impossible for members of the said unit to give individual
       attention to child abuse cases because of the high workload;

(2) therefore urges the Government to afford the protection of the safety and security of the children of Durban, KwaZulu-Natal, and of all the children of South Africa the high priority that it deserves;

(3) furthermore requests the Minister of Safety and Security to urgently give attention to the current problems at the Durban Child Protection Unit and to report as soon as possible to the Council on the steps that have been taken to resolve the situation in Durban and on the situation in respect of case loads, staff, stationery and transport at other child protection units in the country, as well as in respect of the investigation of child abuse cases in police areas where there are no child protection units;

(4) acknowledges the fact that police members across the country are working under difficult circumstances;

(5) however, expresses its reservations around the use of strike action as a means of achieving their objectives because -

   (a)  it does not assist the victims of crime; and


   (b)  the Government, by way of the Minister of Safety and Security,
       has already committed itself to improving the working conditions
       of police members across the country;

(6) commends those policemen and women who, despite their difficult working conditions and high case loads, continue to provide an excellent service to their respective communities; and

(7) resolves to make every effort to ensure that the commitments made by the Minister of Safety and Security are translated into practice sooner rather than later.

             ARREST OF FORMER LAND BANK BRANCH DIRECTOR

                         (Draft Resolution)

Ms E C GOUWS: Madam Chair, I move without notice:

That the Council -

(1) notes that -

   (a)  a former branch director of the Land Bank in Tzaneen, Sydney
       Khando, was arrested by the anticorruption unit in connection
       with fraud, forgery and theft of R24 million; and


   (b   it has been established that Mr Khando was an illegal immigrant
       without a work or residence permit;

(2) expresses its concern at the apparent failure of the Land Bank to check the credentials of prospective employees, thus failing to prevent this incident; and

(3) therefore calls on the Land Bank to ensure that they follow proper employment procedures and observe the law at all times.

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

                   APPOINTMENT OF PANSALB MEMBERS

                         (Draft Resolution)

Mnr A E VAN NIEKERK: Voorsitter, ek stel sonder kennisgewing voor:

Dat die Raad -

(1) kennis neem dat die Minister van Kuns, Kultuur, Wetenskap en Tegnologie op Vrydag, 4 Mei 2001, sewe van die voorgeskrewe minimum van 11 raadslede vir die Pan-Suid-Afrikaanse Taalraad aangekondig het;

(2) verder kennis neem dat die name van 20 kandidate deur die parlementêre komitee aan die Minister voorgelê is nadat ‘n proses soos deur die wet vereis, gevolg is; (3) ook daarvan kennis neem dat beskikbare inligting daarop dui dat die Kabinet 13 van die kandidate afgekeur het, wat op growwe bemoeienis met ‘n parlementêre proses dui en verder die onafhanklikheid van hierdie grondwetlike raad aantas; en

(4) erken dat dit verder daarop neerkom dat daar nog nie ‘n wettige raad saamgestel is nie, omdat die Wet op die Pan-Suid-Afrikaanse Taalraad ‘n minimum van 11 lede voorskryf. (Translation of Afrikaans draft resolution follows.)

[Mr A E VAN NIEKERK: Chairperson, I move without notice:

That the Council -

(1) notes that on Friday, 4 May 2001, the Minister of Arts, Culture, Science and Technology announced seven of the prescribed minimum of 11 board members for the Pan South African Language Board;

(2) further notes that the names of 20 candidates were submitted to the Minister by the relevant parliamentary committee after a process had been followed as required by law;

(3) also notes that information to hand would indicate that the Cabinet rejected 13 of the candidates, which points to gross interference in a parliamentary process and furthermore tampers with the independence of this constitutional board; and

(4) concedes that this also means that a legitimate board has not yet been constituted, as the Pan South African Language Board Act requires a minimum of 11 members.]

The CHAIRPERSON OF THE NCOP: Is there any objection to the motion? There is an objection. The motion will therefore become notice of a motion.

                CONGRATULATIONS TO PRESIDENT CHILUBA

                         (Draft Resolution)

Mr K D S DURR: Chairperson, I move without notice:

That the Council -

(1) congratulates President Chiluba of Zambia for putting the Zambian Constitution above the ambitions of his supporters by refusing to stand for a third term of office as President of Zambia, as currently disallowed by his country’s constitution;

(2) is aware of the positive effect this selfless act will have upon his country and the future of democracy in the region;

(3) salutes him for the relative success and stability in Zambia over the past 10 years, surrounded as he has been by a sea of uncertainty and instability in the DRC, Angola and Zimbabwe; and

(4) wishes President Chiluba well for the remainder of the year as he will play a key role as party leader in choosing his successor for the election next year.

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

The CHAIRPERSON OF THE NCOP: I would have welcomed a congratulation of members of that country’s parliament, but I suppose members do not appreciate the role of parliamentarians, so we will move on. [Interjections.]

           DISCOVERY OF HISTORIC HAND-AXE IN NORTHERN CAPE

                         (Draft Resolution)

Mr J HORNE: Chairperson, I move without notice:

That the Council -

(1) notes that Vincent Dinku, who is studying Archaeology through Unisa and who is a staff member at the McGregor Museum, Kimberley, uncovered a magnificent example of an historic Fauresmith hand-axe, while gardening in his yard in Lobatsi Square, Galeshewe, in the Northern Cape;

(2) further notes that the hand-axe is estimated to be approximately 250 000 years old, that it will be housed at the McGregor Museum and will be of both educational and historical interest, especially to tourists; and

(3) commends Vincent Dinku on his discovery and acknowledges that the unearthing of the hand-axe has been reported to the SA Heritage Resources Agency, which will issue a permit.

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

            SUPPORT FOR PRESIDENT BY BLACK PROFESSIONALS

                         (Draft Resolution)

Ms B THOMSON: Madam Chair, I move without notice:

That the Council -

(1) notes and commends the initiative by black professionals and businesspeople in showing support for the President;

(2) supports the view by the signatories that - (a) the President was democratically elected by an overwhelming majority of this country; and

   (b)  irresponsible reporting and questions about our President's
       ability to rule should not be supported by South Africans; and

(3) calls on all South Africans to unite in action for change.

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

                     INTERNATIONAL HOSPICE WEEK

                         (Draft Resolution)

Dr P J C NEL: Voorsitter, ek stel sonder kennisgewing voor:

Dat die Raad -

(1) daarvan kennis neem dat -

   (a)  vandeesweek internasionaal tot ``Hospice''-week verklaar is;


   (b)  die hooffunksie van Hospice die tuisversorging van terminaal
       siek pasiënte is; en


   (c)  daar tans 'n geweldige, stygende aanvraag na die dienste van
       Hospice is, weens die verskriklike afmetings wat die MIV/Vigs-
       pandemie aanneem, en die geweldige las wat dit op die openbare
       en private gesondheidsdienste plaas;

(2) Hospice alle sukses toewens met die bekendstellingsprogramme en fondsinsamelingsprojekte wat hulle vandeesweek van stapel gaan stuur en sy dank en waardering uitspreek vir die kosbare werk wat Hospice verrig; en

(3) die Minister versoek om dit te oorweeg om in die toekoms hierdie nie- regeringsinstansie finansieel te ondersteun. (Translation of Afrikaans draft resolution follows.)

[Dr P J C NEL: Chairperson, I move without notice: That the House -

(1) notes that -

   (a)  this week has been internationally declared ``Hospice'' week;


   (b)  the primary function of Hospice is caring for terminally ill
       patients at home; and


   (c)  there is currently a huge, increasing demand for the services of
       Hospice, as a result of the frightening proportions that the
       HIV/Aids pandemic is taking on, and the enormous burden this
       places on the public and private health services;

(2) wishes Hospice every success with the introductory programmes and fund-raising projects they are going to launch this week, and expresses its thanks and appreciation for the valuable work that Hospice does; and

(3) requests the Minister to consider supporting this non-governmental institution financially in the future.

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

   CONGRATULATIONS TO CHAIRPERSON ON APPOINTMENT TO CPA EXECUTIVE

                         (Draft Resolution)

The CHIEF WHIP OF THE COUNCIL: Chairperson, I move without notice:

That the Council -

(1) notes with pride and pleasure -

   (a)  the nomination and election of the NCOP Chairperson, Mrs Naledi
       Pandor, as an executive member of the Commonwealth Parliamentary
       Association as a representative of the Southern African region;
   (b)  that her election is recognition of her leadership qualities and
       abilities; and


   (c)  that this appointment reflects the confidence that the states in
       the Southern African region have in the leadership of South
       Africa; and

(2) expresses its confidence that she will perform her functions and execute her responsibilities with the customary diligence, ability and competence that she has shown over the years.

We congratulate you, Chairperson. [Applause.]

The CHAIRPERSON OF THE NCOP: Now I am supposed to say, ``Is there any objection to the motion?’’ [Laughter.] Ms Versfeld, was that an objection? [Laughter.] That would have quite an impact on your functioning in the House. [Laughter.] Thank you very much, Mr Surty and hon members.

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

                         APPROPRIATION BILL
                         (Review of Policy)

Vote No 31 - Trade and Industry:

The MINISTER OF TRADE AND INDUSTRY: Thank you, Chairperson, and my congratulations too on your appointment and nomination.

Chairperson, hon colleagues, it is again a pleasure to be able to present my department’s budget for the Council’s consideration. As is customary with both the portfolio and select committee, the House has had a chance to interrogate the department’s budget and produced, in my view, a good report thereon. Furthermore, this House has heard representations and presentations by the DTI group of institutions: Ntsika, Khula, the Industrial Development Corporation, the CSIR and the SA Bureau of Standards.

I must really register my particular pleasure at the oversight role and the continued support of the committee in the NCOP, and its representatives from the provinces. Last year they visited the department to gain a first- hand appreciation of the work we do and hosted the hearings on the banks’ role in small business development. The recommendations they made were invaluable and we will continue to rely on such active support and involvement from the committee to ensure we effectively deliver our identified targets.

I will not say a great deal about the detail of the budget and our detailed programmes which are well covered in the Expenditure Review of Vote 31 on page 664.

The President announced an economic action plan in the state-of- the-nation address to Parliament at the beginning of the year, wherein he identified specific programmes to accelerate the growth of our economy. This was an important watershed for several reasons. Firstly, it signified a paradigm shift from macroeconomic stability to microeconomic reform. Secondly, the level of co-ordination in government to develop this action plan is unprecedented. Thirdly, the plan is action-orientated and focuses on concrete deliverables that departments have to report to Cabinet on a monthly basis.

The DTI, through its leadership role in the economic cluster and the Cabinet committee on investment and employment, is charged with ensuring that the co-ordination continues with the implementation of this plan. The department accordingly has aligned its own work programme with the priorities outlined in the action plan.

When I addressed the House last year I stated that transforming our economy is a continuous process, one that is not easy, but one that is necessary in order for us to create the growth required to provide new economic opportunities and jobs for our people. We are making headway in this endeavour.

The South African economy has been growing steadily since we got over the Asian crisis. This year promises a second year of growth higher than 3%, and next year is even more promising, according to a wide range of economic forecasts. Consumer confidence is improving, which, I think, is not surprising as inflation is under control and interest rates have been very steady. We are expecting fixed investment to improve, both through higher rates of Government capital investment and through improved private-sector investment.

I am pleased that through successful co-operation with the national Treasury we have also been able to introduce a new product, the strategic investment allowance, that, we believe, will further serve to attract higher levels of both domestic and foreign direct investment.

Last year we realised inward fixed investments of some R6,1 billion in the manufacturing sector as a result of the efforts of our own foreign offices, and we achieved an outward investment into Africa of some R500 million. We also realised trade growth of some R4 billion in the sectors that Trade and Investment South Africa targeted.

The basis of the economy’s increased performance is the outstanding improvement we continue to have in exports. Manufactured exports have grown rapidly every year, with our manufactured exports rising twice as fast in the post-1994 period as in the pre-1994 period.

This growth in exports is widespread across almost all manufacturing sectors. Chemicals, metal and metal products, machinery, auto and auto components have registered particularly strong growth. That this trend is continuing is shown by the very strong balance of payments surpluses we recorded in the first quarter of 2001, which totalled some R8 billion.

This is illustrated graphically in the automotive sector. A few years ago we did not export motor cars at all. Currently, we produce the 3-series BMW driven by people in the UK and other parts of the world that use right-hand drive vehicles. Exports of motor vehicles were R584 million in 1995 and almost R8 billion last year. Vehicle exports from South Africa are expected to exceed 100 000 units in 2001, and component exports grew from less than R987 million in 1995 to R2,25 billion in 2000.

The transformation of our economy in this manner takes place within the context of globalisation. The attempts made by the trading economies in the developing world to create a more equitable, rules-based world trading system are gaining momentum and should culminate in a new round of negotiations, we hope, this year. It is imperative for South Africa to play a leading role in these efforts, as we are among the largest trading economies in the developing world and particularly on the African continent.

It is important for the economies of the south to collaborate in fostering an equitable world trading system. The current rules and regulations governing international markets perpetuate and polarise existing disparities in the economies of the world. The wealthy, technologically advanced nations continue to benefit from increased access to the markets of the developing countries without there being reciprocal access for the developing economies, particularly in such key areas as agriculture.

We must continue to build strategic trading relations with the trading economies of the developing world, because economic growth in the 21st century will occur in these economies of the south. The SADC Free-Trade Agreement is a key instrument in this regard and regional economic integration must be strengthened further. Currently, we are at an advanced stage of our exploratory phase to develop a free trade agreement between South Africa and Mercosur in South America. As part of this process, a high- level Brazilian technical team is currently visiting us this week to further discussions and movement in this regard. We are also exploring similar arrangements with Nigeria, whose Minister I will meet after this debate, and with India.

Furthermore, the Millennium Africa Recovery Programme - Map - announced by President Mbeki, together with President Abasanjo of Nigeria and President Bouteflika of Algeria, opens major opportunities for Africa to improve and strengthen continental economic activities. As a continent we need to use Map as a vehicle to engage the multilateral trading system. Africa needs to be looking at how we can work within the framework provided by Map to create greater economic activity to allow us to better utilise the trade opportunities we are creating with our major trading partners in the developed world.

South Africa needs to engage the opportunities provided by multilateral institutions and programmes to increase market access to both the developed world and the developing world. Vehicles such as the South Africa-European Union Trade, Development and Co-operation Agreement and the US-initiated Africa Growth and Opportunity Act provide us with substantial opportunities to grow our productive capacities and engage new markets in a focused and effective manner. I recently returned from what I believe to be a highly successful trade and investment mission to Japan and Hong Kong.

However, we are also facing increasing challenges on how to make our economy more competitive, not just for export growth, but because we face increased international competition in the local economy. The nature of competitiveness is changing altogether. In the past, it was cheap labour, access to raw materials and privileged market access. Currently, competitiveness is characterised by the use of new technologies, the ability to respond to changing consumer demands, efficient logistics and supply chains, and continual innovation. All of these are knowledge- intensive activities that require skilled and adaptive workers.

At the end of this month we will be presenting our framework for addressing this challenge of ensuring the competitiveness of our industrial sector to our social partners in Nedlac and then to this Parliament. The scope of our policies will broaden and we will be looking at new policy instruments. We will pay particular attention to the knowledge-intensive activities and sectors that are rapidly increasing in importance in the global economy. Alongside this is our growing co-operation with other Government departments to promote competitiveness and spur investment through reducing the costs of doing business in South Africa by improving performance in key output sectors such as energy, transport and telecommunications.

As an investment in our future competitiveness, the department approved 78 applications to the amount of R53,7 million as part of the Support Programme for Industrial Promotion, SPII. Thirty-nine of these projects to the tune of some R28 million have now been completed. Through the department’s programme to provide financial support for researchers and students in tertiary institutions - the Thrip programme - we approved projects to the value of R96 million for the development of technology and appropriately skilled people.

These projects leveraged in a further R97 million from the private sector. Interestingly and, I think, importantly, 29% of the participants in these programmes are women, 43% of the students in these projects are black, and 50% of the participants in these programmes are SMMEs.

Additional programmes to assist firms in their efforts to take up the challenge of competitiveness include the Competitiveness Fund and the Sectoral Partnership Fund, which recently have also been accessed, I am pleased to say, by the trade union movement.

A major challenge will be to translate enhanced competitiveness into more jobs. Employment will come through increasing investment in both our physical and our human resources. Increased export activities will also generate employment. The increase in employment, as a result of export growth, substantially surpasses any job losses that occurred as a consequence of increased import penetration. The higher value exports that we are striving for will increase income in the domestic market and, in turn, initiate a domestic growth process which is essential for our future.

Let me turn now to small and medium enterprise development. As spelt out in the President’s opening-of-Parliament address, Government is taking specific steps to attend to the challenge of promoting small, medium and micro enterprises.

There are many small business development initiatives being undertaken by national Government departments and by provincial and local government. To be effective, these activities must be co-ordinated. In future, SMME development activities are going to form an integral part of all industrial development initiatives throughout our department and the DTI group of institutions.

In order to ensure that economic citizens get maximum benefit and service delivery from the DTI group as a whole, we created a new structure in May

1. This is called the Council of Trade and Industry Institutions, or Cotii, which I chair. Cotii meets regularly, and consists of all the DTI institutions - the CSIR, the IDC, SABS, Khula and Ntsika.

One of the key objectives of work now being done is how members of the Cotii team can work together to improve the effectiveness of small business delivery. This will ensure that SMME development does not become isolated from mainstream industrial development strategies.

In an effort to clarify the role of the various role-players in this sector, the department is planning to release a revised policy paper on small business. This will provide an update of the 1995 White Paper that currently informs the basis for policy. Legislation will give effect to the policy recommendations, and we will introduce it later this year.

One of the most important recommendations to emerge out of this policy review will be a proposal to reorganise Ntsika into a more focused support agency for small business. In addition, a National Small Business Advisory Forum will be established to replace the old National Small Business Council.

This advisory forum will provide a structured opportunity for ongoing interaction between me and the small business community. It will allow small business to engage Government at the highest level.

At a programme level, we will begin to focus on the following four areas: creating new enterprises, in particular, the growth sectors identified in the President’s state-of-the-nation address; improving access to finance; introducing a company partnership programme to link large corporations to small businesses through procurement and other means; and, lastly, concentrating on the creation of new small enterprises in the newly designated IDZs and the existing SDIs or spatial development initiatives, the rural nodes of our Integrated Rural development Strategy and the 10 areas identified for urban upgrade by the President. Black economic empowerment is fundamentally a moral and economic imperative. The report published by the Black Economic Empowerment Commission represents a milestone in our efforts to more fully understand this very pressing challenge. Government will respond soon to the commission’s recommendations. Specifically, Government would like to engage the commission on three key points, that is: an official voice for black business; developing a common understanding of what we mean by black economic empowerment and developing, in particular, indicators of success; and resourcing the black economic empowerment initiatives that are proposed.

Another significant achievement in this area is the appointment of the board and staff of the National Empowerment Fund. The capitalisation of the fund has gained momentum with the ongoing restructuring of state-owned enterprises.

The department itself needs to more clearly articulate how all of its programmes contribute to the achievement of black economic empowerment. The department will be looking at supply- side issues, in particular those including access to finance, markets, skills and technology. I will be engaging top South African corporates on their role in removing the obstacles to empowerment. This is an extension of the work of the President’s working groups of black business and big business, who both have supported this initiative.

Finally, these efforts must not be confined to South Africa alone. Through Map we need to work towards the creation of truly African multinational corporations.

As an integral part of our activities to create value for our economy, the department has taken a number of initiatives to promote co-operative governance and work more closely with provincial governments. In April 2000 a provincial heads of department committee was established. This committee, which is chaired by my director-general, meets every six weeks to discuss matters of mutual interest and to promote synergies between the national departments and our provincial counterparts.

I have held regular meetings with the provincial MECs on a quarterly basis and, for the first time, a provincial lekgotla will be held in September this year. To further support these initiatives, a senior DTI representative, at the level of a deputy director-general or chief executive officer, has been assigned to work directly with a province and to act as the first contact point between the province and the national department.

In March 2001, the DTI initiated a programme of monthly visits to provinces. Each month the DTI’s executive board convenes its meeting in a province. A meeting is held with provincial stakeholders, including MPLs, local business and local councillors. A meeting is also held with the provincial department to learn about the economy of the province and the strategies they have adopted to develop their local economy. To date, we have held successful visits to the North West and the Western Cape. In an effort to strengthen our co-operation with provinces and deliver a better service to economic citizens, we will be opening DTI offices in all nine provinces.

Coupled with these efforts, a stronger and better co-operation among all levels of Government is essential in our efforts to move our economy in the right direction. We have had great improvements in areas of co-operative governance between national, provincial and local government. Last year I made public my intention to reorganise my department in order for it to deliver on the economic challenges I have articulated earlier, such as globalisation, increasing our growth rate beyond 3%, black economic empowerment and small business development.

I am pleased to report that the process to transform our department has been implemented successfully and is already beginning to make a positive impact on our service delivery to our economic citizens. The department has restructured itself into six divisions which are more in line with the operations and services we are responsible for. The department has also achieved its targets set for gender equality in top management.

Of the seven new positions created as a result of the new DTI, four are occupied by males and three by African women. Of the 882 officials employed by the DTI, 530 are black, 463 are African, and 200 of the 463 are African women. At 56% of the total staff composition, women are the majority in the department. Through accelerating the employment of women in senior positions, we intend to fast-track the mainstreaming of gender equality in all the department’s programmes. All these developments have had a direct impact on the department’s functioning, and significant milestones have been achieved in respect of service delivery.

Firstly, there has been dramatic reduction in our roll-over from last year’s almost R600 million to R60 million this year. Secondly, R30 million was allocated to the Technology for Women in Business programme to support women using technology to grow their businesses. Thirdly, Khula has increased its support of women from below 50% last year, to 88,1% this year.

Fourthly, in the first three months of this year we announced our intention to proclaim the first two IDZs, both in the Eastern Cape. Fifthly, last year we registered a record 77 000 close corporations, and since September reduced registration time of a close corporation from 14 to 5 working days

Sixthly, we registered a record 31 800 companies, and since September reduced registration time of companies from 21 days to 5 to 6 working days. Lastly, we receive 1 200 name reservations per day, and since September we have reduced processing time from eight days to four working days. These successes in the companies office are testimony to our commitment to reducing the regulatory burden faced by business. As the role of the state is to grapple with developing and managing a highly complex regulatory environment to make it stable and predictable, we are far advanced in creating this enabling regulatory environment, with the establishment of the Competition Commission and the amendment of the Competition Act, following our experience in first year of implementing that legislation.

This year we will transform the Board on Tariffs and Trade to establish the Commission for International Trade Administration. The Board on Tariffs and Trade is currently handling 200 tariff investigations, 2 000 rebate permits, 150 duty credit certificates, 2 000 import rebate certificates and 28 000 import and export control permits. As the Board on Tariffs and Trade serves the Southern African Customs Union, we have held extensive negotiations with our partners to ensure their satisfaction with the new arrangements.

The Bill to establish Cita was approved by cabinet and will be presented to our social partners in Nedlac soon and, we hope, will be passed later this year through the two Houses. Other legislation to be brought before this House in the near future on issues on which we share concurrent responsibility with provinces include consumer protection, gambling and liquor legislation.

We would like to thank the committee for its vigilance in raising the sometimes negative social consequences of gambling. Earlier today we had, I believe, an excellent hearing and meeting.

After coming under significant public pressure to distribute good-cause money in the lottery, I am pleased to say that our more cautious and thoughtful approach to this issue, I believe, was correct. We now confidently know that we have in excess of R350 million to distribute to good causes in this financial year. Having published in all national newspapers, on radio and television a call for applications for funding, we received a total of about 4 500 requests for application forms.

We are pleased to report that we received applications for funding from some of the remotest areas of our country, to fund income-generating activities and charitable causes. However, I am somewhat disappointed and a little bit puzzled that to date we have, in fact, only received 215 applications for funding from charities, three from sport and recreation bodies and six for arts, culture and national heritage.

It is widely acknowledged that the Government of South Africa in the last five years has achieved much by way of placing the South African economy on a sustainable growth path. This process has involved considerable adjustment in our economy and has not always been easy. We now face the challenge of strengthening and accelerating this reform process. I am confident that we as Government have put in place, through the presidential economic action plan, the ingredients to achieve accelerated growth and development. DTI is an integral part of the success of this plan.

We stand here because we share, I believe, a collective commitment to improving the lives of all South Africans. I believe the budget set out in Vote No 31 of the Department of Trade and Industry for 2001 contributes greatly to this cause, and I urge the NCOP to support it.

Mr T MAKWEYA (Northern Cape): Chairperson, hon Minister and the House at large, it is with great pleasure that we participate in this very important debate today. From the onset we would like to really like to thank the Minister of Trade and Industry for the approach he has taken in ensuring that provinces are part of everything that happens in his department.

The fact that the last Minmec was held in Kimberley also afforded us an opportunity to interact with him and his officials on key issues that affect our province. We are, unfortunately, from a province that really started from nothing. There was no department of economic affairs and, in fact, we still do not even have a legislature building. Sometimes we meet in our houses. [Laughter.]

Nonetheless the economy of the Northern Cape is dominated by the primary sector. In 1995, mining and agriculture accounted for 31,5% of the total value-added GGP. When considering the dominance of the primary sector within the provincial economy it becomes apparent that ample opportunity exists within manufacturing, which makes up only 4,4% of the provincial GGP. Most of the raw materials produced within the Northern Cape is currently beneficiated outside the provincial boundaries.

The GGP of the province accounted for 2,1% of South Africa’s GGP some two years ago, I think. Agriculture covers a range of activities from household food production to capital-intensive irrigated farming along the Orange and the Vaal Rivers, and extensive livestock production. Game farming is an emergent activity, both for hunting and food production.

Diamonds, manganese, iron ore and zinc dominate the mining sector. Large- scale mining predominates, with small-scale mining accounting for about one fifth of the total output. I must say that undersea mining accounts for about 97% of small-scale mining in our province, and that is predominantly in the Namaqualand region.

The province contains the world’s largest deposit of manganese - I think 25% of the world’s reserves - and vast deposits of iron ore. The point we would like to emphasise, which is a matter that we have started discussing with the Minister’s office, is that of ensuring that we beneficiate these and other minerals so that we can stimulate the economy in order to achieve the desired 3% growth in our economy that the Minister is looking at.

Through analyses of the sectoral contributions to the provincial GGP, it has also become clear that the Northern Cape economy is moving towards a more service-oriented economy. This trend is confirmed by a decreased contribution of the primary sector and an increased contribution of the tertiary sector towards the provincial GGP. In 1980, the primary sector contributed 59,7% towards our GGP, compared to 32,2% by the tertiary sector. By 1995 the primary sector’s contribution had decreased to 31,5% and the tertiary sector’s had increased to 56,5%. This structural shift has also become evident within the GGP contributions of the six regions within the province.

The Diamantveld’s contribution has shown a 1% drop over a period of 25 years. However, during this period, the Diamantveld region has reduced its reliance on the primary mining sector and diversified its economic base. The significant downscaling of mining activity in the Namaqualand region is the main reason for its declining contribution towards the provincial GGP.

There have been rumours that diamond mines are being exhausted. We have spent the past six years doing thorough research on mining and agriculture in this province, and, fortunately, the research has proven positive. There is still a wealth of resources, and we are trying to see how best we can also ensure that blacks benefit from this wealth of resources.

However, the issue of beneficiation cannot be overemphasised. It is a matter that we are looking at, and, as I have said, we are working closely with Trade and Investment South Africa and DTI directly. We are happy that within the next couple of months we will be able to make some breakthroughs as far as that matter is concerned.

The manufacturing sector in our province concentrated mostly on the capital, Kimberley. This is also a sector that is extremely underdeveloped. As I said, it contributes 4,4% towards our provincial GGP. Research indicates that a significant percentage of inputs required by the manufacturing sector is sourced outside the province, whilst most manufactured goods are consumed locally. Given the significant mineral and agricultural output found in the Northern Cape, the potential for increased manufacturing opportunities and exports is self-evident.

Information on the tourism sector is unfortunately not easily identified in the national accounts and thus in the above statistics that I have just mentioned. Our province has experienced a significant growth in the number of tourists, both international and domestic, visiting the province. Opportunities to upgrade and develop the untapped tourism potential of the Northern Cape abound.

It is unfortunate that as we deal with the realities of our economy, especially taking into consideration global realities, the table grape industry, for which we are also known, especially along the Orange River, is currently facing a number of challenges that seriously threaten growth in exports of the magnitude required to sustain expansion in production. These range from market development, through infrastructural and logistical constraints to quality and production issues back on our farms. The industry is ripe for a credible, competent and technically sound programme of support. Similarly, we talk ad infinitum about promoting diversification and value-added agricultural processing opportunities. However, we usually only consider this from a point of view of production alternatives.

Again, the agricultural fraternity is definitely interested in researching new trade opportunities identified, may justify the substitution of new crops for those that are currently cultivated. A huge opportunity exists for the department to configure a programme of support that actually results in diversification and/or the development of agroprocessing.

We are once more pleased to note that even today there is a delegation from the Minister’s department touring the province - I was with them yesterday in Upington - looking at the various incentive packages that exist. We can only wish them everything of the best with the initiatives that they are undertaking. We also welcome the decision to ensure that DTI offices exist in the different provinces.

The SDI that has been established in our province also holds the promise of very good projects along that route. We are happy that the Northern Cape will no longer be seen as the stepchild of this Government. [Laughter.] [Applause.]

The CHAIRPERSON OF THE NCOP: I was not aware that the Government was married. [Laughter.] Mr M V MOOSA: Chairperson, I want to thank the Minister for his kind words to the committee. I do not think we have done half as well as we would like to have done over the past year. There are a number of things that this committee would like to do, given a well-co-ordinated structure involving the provincial legislatures. But I think we are on a learning curve, and over time, hopefully, we will get there.

Firstly, I want to thank the Minister, the Deputy Minister, the Director- general and members of the department for what we believe has been an open and an engaging relationship in which we have dealt many issues over the past year. The department has been prepared to come to Parliament and answer sometimes difficult and engaging issues. Over time we have learnt that some of the problems faced by the Department of Trade and Industry are not easily solvable. Parliament itself, hopefully, wants to become a partner of the DTI in addressing some of the issues that face the department.

Specifically from the point of view of the NCOP, the department has taken a very conscious decision during the past year to engage with the provinces, and the Minister has outlined some of those issues in his speech. Even more specifically, the department has decided to establish Trade and Industry department offices in each of the nine provinces.

The provincial delegations that are here and chairpersons of the portfolio committees in the legislatures should be aware of the fact that, at some point in the near future, there will be a DTI regional office in their particular province where a number of the initiatives the DTI is engaged in, such as incentives for businesses, industries, certain sectors and so forth, will be run. It will also serve as a forum where the provincial business community can engage with the DTI, right on its doorstep.

Hopefully, a view from the NCOP committee would be that the provincial portfolio committee should be able to call those offices in for briefings. One does not necessarily have to have the national Parliament engaging with the national DTI office and so forth on briefings, but on matters which affect provinces on concurrent power issues, I think that provincial portfolio committees should utilise this opportunity to engage directly with the Department of Trade and Industry. As the Minister has indicated, the department has also taken a decision to embark on a visit to all nine provinces. The department’s officials have already visited the North West province, where they spent two days, and the Western Cape, where they have engaged in a whole string of meetings with stakeholders, local chambers of commerce, provincial executives, developmental agencies and so forth. The programme continues. On 13 and 14 August they will be in the Northern Province, on 17 September they will be in the Eastern Cape, on 22 September they will be in KwaZulu-Natal, and on 26 November they will be in Gauteng. Hopefully, members of provincial delegations who are present here will take time to put together the right kind of stakeholders to engage the Minister and the departmental officials who come there during those visits. I think even chambers of commerce will be very useful.

A number of other things the department has done indicate to us that they have become very serious about engaging with provinces. Hon members know, for example, on the gambling issue more recently, we have been engaging the department on a whole range of things that might affect the gambling industry and the socioeconomic impact of gambling in particular provinces. Hon members will know that today the Minister and the gambling board have engaged with nine provincial delegations on the gambling issue and to address the questions that face that particular industry.

The department has indicated that they want to do similar things on other concurrent power issues such as liquor and a whole range of other things. But I do not think it is necessarily limited to that. If a particular province feels that it has some niche industries, some niche sectors in which it wants growth to take place because those industries want to market themselves in a particular way, or the province wants to market its industries or commodities in a particular way, I do not believe that the department will be closed to any ideas about engaging with a province or a particular set of industries in a province about those kinds of issues.

If we are saying that the Northern Province is a platinum province or some province is a fishing province, or whatever the case is, the department would be, I believe, from the general engagements we have had with the department over the past year and a half or two years, be prepared to engage in those kinds of discussions to ensure that provincial economic development strategies are enhanced in such a relationship. The NCOP committee, and no doubt the NCOP generally, has been prepared to be part of a process of facilitating that if it becomes necessary.

The department’s budget this year was in the region of about R2,2 billion. We have had briefings with the department about that budget, and in the briefings it was clear that there are two programmes in the department that tend to take the biggest chunk of the expenditure. The one programme is the enterprise and industrial programme which takes about 46% of that R2,2 billion and the other programme is the enterprise organisation programme which takes about 34% of the expenditure.

What is important to note about these two programmes is that they directly involve themselves in actual economic activity. We are not talking about administrative costs or costs for forums and those kinds of things, but we are talking about actual programmes that result in incentives and so forth for certain key sectors, certain key industries, transfer payments to a whole range of agencies and organisations that are involved on a direct, day-to-day basis in economic activity, whether those are export councils or things like companies and offices. A number of initiatives fall within these particular programmes. These are the supply-side incentives that the Minister raised very briefly, the dedicated programmes to SMMES and black economic empowerment programmes and certain contributions. Well, I believe that in this particular budget, contributions to the National Empowerment Fund and the Competition Commission have been reduced, but of the total budget allocated to this department about 82% goes towards transfer payments agencies that are being utilised, hopefully on a day-to-day basis by various sectors of the economy.

We have also been very encouraged by the fact that the IDC more recently shifted its focus in order to also begin providing support, financial and otherwise, to smaller enterprises and business where they believe that there is an opportunity for growth and for export markets and so forth. In briefings that they have had with the committee over the past while, it has become clear that they have clearly focused away from only financing very large projects, some of which have been successful, but, as we know, some of which have run into trouble, like Saldahna Steel. I am surprised that the Minister did not tell us about that, but maybe in his reply he would like to tell us whether there is some progress on that particular one.

We have also picked up in the Council for Scientific and Industrial Research briefings that we have received, that although the CSIR receives some R300 million for research and development into key issues around our economy - commodity development, technology development and so forth - they report to us that very large chunks of research and development that had previously been done by our private sector are being moved offshore, for example, when we allow companies to list in other economies and so forth, and when head offices of companies move out of our economic environment.

Together with those listings and this offshore movement there is also the moving of most of the research and development staff that is done by some of these companies. That is a very worrying thing, because we will remember that some of the research and development done in our economy, particularly in the apartheid days, but even since 1994, became very useful in creating certain niche areas of our economy, certain strengths of our economy that we otherwise would not have had had we not in our private sector engaged in those kinds of research and development initiatives. One hopes that at some point the department will address some of these things.

I want to raise in this particular discussion one issue that I believe we as a Parliament must consider very seriously during the course of this year. We know for a fact that the department and the Minister have done very well in ensuring that we open up export markets and so forth. The European Union agreement has been very, very successful, and, of course, much of the process set up by the SA-EU agreements is now under way. We have had lots of very encouraging approaches that have come through to us from African Growth and Opportunity Act agreements. Of course we have taken a cautious approach to them, but nevertheless those are opportunities and markets that have opened up.

The Minister has indicated that we have opened enough opportunities with all the Mercosur of countries. Those are Brazil, Uruguay, Bolivia, Argentina and so forth. Serious big opportunities and markets have opened up for this country in some of those areas. We have markets opening up in the SADC area, and, generally speaking, with the African Union talks and with the African Millennium Action Programme, markets opening up in the rest of Africa.

But what does that mean to our country and for our economy? That is the question we, as Parliament, want to put down on the agenda this year. Are we as a country, is our economy, are our various sectors and our industries, ready to take on the opportunities that have been thrown up by all the good work that the Minister and the department are doing?

It is all very well for us to open up markets. I think the Minister has been working frantically at opening as many markets as possible for our commodities internationally. But all this will be of little avail if we do not have systems in place so that our commodities can find those markets, if we do not have systems in place to ensure that our entrepreneurs and our businesses in this country know how to access and go through the processes of export in those commodities, if we do not ensure that we do sufficient research and development around what industries are doing in other countries.

For example, the Chinese are flooding the world markets with textiles at prices that are absolutely ridiculous. Our own textile industry and production houses in this country cannot seem to cope with the pricing structures that are being brought out by some of those economies.

Now the question that we are asking is, if all these markets are beginning to open up to us, if we are developing free trade agreements and free trade areas, have we done sufficient homework, and are we thinking sufficiently about whether we can make maximum use and take maximum advantage of these opportunities that are opening up?

That takes us to the very next question which, I believe, the Minister is addressing. I think, nevertheless, an important issue is the question of whether we have an industrial strategy for this country. The Minister will know that we have raised this matter on many occasions with the department and the Ministry.

A lot of work has been done by the Ministry in getting down certain key strategies in various sectors and industries in the country. But for how long, for example, is our automotive industry going to be a cutting edge automotive industry in global markets? We might be doing very well now, but five or 10 years down the line we might have another economy in a developing country which might begin taking certain initiatives in this niche area and undercutting us.

How long, for example, will our other key industries, such as platinum, gold and so forth, sustain the growth that we think we want to sustain in those particular areas? These are questions that arise around, for example, whether our commodities are saleable in international markets. Are the standards there, are the systems and places there for us to check and ensure that our commodities are acceptable in those markets? Are we marketing our commodities sufficiently so that those markets, whether the European Union or others, are aware of our products, are aware of our competitive pricing and so forth?

Those are the kinds of questions we want to be put down on the agenda very urgently. In five to 10 years’ time, when the European Union’s agreements with South Africa become an absolute reality, are we going to find ourselves in a situation in which our markets are flooded by commodities from other countries and other economies and our own industries start ailing? Do we understand now what the impact is going to be in five to 10 years’ time when free-trade agreements become an absolute reality and tariff barriers close down? I think all of that relates to whether we have been thinking about what our industrial strategy in this country is. Which key sectors …

The CHAIRPERSON OF THE NCOP: Order, hon member. I am afraid your time is up.

Mr M V MOOSA: Is my time up already?

The CHAIRPERSON OF THE NCOP: Yes, it is.

Mr M V MOOSA: I thought I had nine now and six later.

The CHAIRPERSON OF THE NCOP: It is well over. I was very generous.

Mr M V MOOSA: I have used all that up. Sorry. [Applause.]

Mr J L THERON: Hon Chairperson, hon Minister and hon colleagues, two of the main issues in South Africa today are crime and the lack of sufficient economic growth. Tied with that, of course, is sustainable job creation.

The DA thinks that if we can sufficiently increase the economic growth rate and that of job creation, this will also alleviate somewhat the crime situation in South Africa. I would now like to analyse the important role that the Department of Trade and Industry and the budget of this department can play in raising the economic growth rate and in sustainable job creation in South Africa. Actually, I want to engage the Minister with some pertinent questions on this.

Firstly, what are the main aims of this department on the strategic focus and functions of the department? It is stated that the aims of the Department of Trade and Industry are to grow the economy through facilitating access to sustainable economic activity; to create employment for all South Africans; to raise the levels of investment; to increase access to South African products in international markets; and to promote a fair, competitive and efficient marketplace for domestic and foreign businesses and consumers.

Last year the committees of Parliament were told that the department had chosen to focus its various activities on three key issues - promoting small, medium and micro enterprises, empowerment and investment. The overall budget allocations voted to this department were R2,827 billion in 1999, R2,16 billion in 2000, and R2,14 billion in 2001. Hon members can see that a lot of money is voted to this department.

Let us look at the main aims and objectives of this department, the main programmes working towards these objectives and the budget that was allocated to these main programmes.

Firstly, regarding economic growth and sustainable job creation, the most important objective of the Department of Trade and Industry is to grow the economy. It is said, ``to grow the economy through facilitating access to sustainable economic activity and employment.’’ This objective of the department is stated precisely like this in the strategic focus and functions of the department.

To attain this objective, let us look at one of the main programmes of this department. The department actually has five main programmes, but let us look at one programme directed at this very important objective. Programme 2 is on international trade and economic development. What are the activities of this programme? The programme promotes and maintains South Africa’s trade relations and agreements with other countries in order to stimulate international growth, internal growth and empowerment, and to maximise foreign exchange earnings through policy and strategy development, programme development, monitoring and evaluation, negotiation and relationship building.

The programme consists of international economic development, African economic development and international trade administration. But what is the problem?

The 2001-02 budget of R28,04 million increased from R23 million in the 2000- 2001 budget, which is, relatively, a very small increase. Personnel expenditure increased by 8,1% due to the weakening of the currency. Membership fees to international institutions also increased from R3,1 billion to R13,1 billion in 2003-04.

These two factors alone wiped out the very small increase. If the department is serious about this very important objective to grow the economy and to create job opportunities, how can there be such a small increase in the budget for this programme? Surely, if one wants to carry our more new activities and do it effectively and efficiently one needs more money? I can therefore already foresee serious problems for the department getting anywhere near a serious effort to grow the economy and create more sustainable jobs.

Secondly, there is the very important objective of raising the levels of investment. Let us look at the second main objective. Here we have to look at Programme 5 of the department, namely Trade and Investment South Africa. The budget here decreased from R339,5 million to R259,79 million. Transfer payments decreased by 14,2% from 2000-01 to 2003-04 owing to reduced contributions to the export credit insurance fund. Here personnel expenditure increased by 14,2%.

Another factor that could, of course, be added here is the question on whether the ANC Government is creating a positive economic climate within South Africa to promote international and foreign investment in the country. I think the answer to this is an emphatic ``no’’. [Interjections.] Hon members should just think of three main areas: the Zimbabwean crisis, HIV/Aids and the so-called conspiracy or plot of Minister Steve Tshwete. Is that creating a positive climate in this country for investment? I say no. [Interjections.] I really think the ANC Government needs a major rethink if they are interested in international trade and foreign investment.

The third objective that I want to address is enterprise and industry development - a very important objective of the department. It states clearly the objectives of promoting a fair, efficient and competitive marketplace for businesses, the promoting of small, medium and micro enterprises, and empowerment.

Let us look at the main programme for attaining this objective. It is, of course, Programme 3, Enterprise and Industry Development. What are the activities of this programme? The programme promotes the competitiveness of the manufacturing industries through research, training, technology and innovation support. It also focuses on enterprise development, with an emphasis on promoting sustainable small and medium enterprises. The intention is to promote the efficiency and competitiveness of the South African economy through an oversight of economic activities and the protection of consumer rights.

Let us look at the budget allocation. [Time expired.]

Mr A E DE WET (Eastern Cape): Hon Chairperson, the MEC for economic affairs, environment and tourism of the Eastern Cape sends his best wishes to this Council and apologises for not being here today.

The reorganisation and rationalisation of the DTI programmes is much appreciated, particularly to the extent that the new structures provide a basis for a more focused approach to key aspects of economic development, such as black economic empowerment and small and medium-sized enterprise development.

The province of the Eastern Cape looks forward to the outcomes of regular performance monitoring against expected outputs and deliverables, as indicated in the DTI’s budget of 2001-02, and for the medium-term extension 2003-04.

The Department of Trade and Industry’s definition of its fundamental task and strategy, namely to grow the economy, is strongly endorsed, particularly with respect to the designated focus areas of facilitating access to sustainable economic activity and employment, increasing the levels of investments, increasing market access and promoting a fair, efficient and competitive marketplace for business and consumers.

The Department of Trade and Industry’s 2000-01 focus on promoting SMMEs, empowerment and investment is also appreciated since these issues impact directly on the economy of the Eastern Cape and remain significant challenges to the provincial government in general and to the department of economic affairs, environment and tourism in particular. In this regard it is noted that the department of economic affairs, environment and tourism has adopted similar approaches to its core responsibility to grow the economy.

In terms of SMME development and investment promotion the department has undertaken a rationalisation of the economic development parastatal organisations in the province to form a newly constituted Eastern Cape Development Corporation with two core functions, namely development finance and investment promotion. The development finance component seeks specifically to facilitate access to sustainable business opportunities and to promote black economic empowerment.

The province notes with concern the report to the Council for Scientific and Industrial Research regarding the perceived trend towards declining private-sector investment in research and development, as was also raised earlier. It seems imperative that this should represent an area for the Department of Trade and Industry to provide additional incentives to promote local research and development investments, particularly in terms of processes that add value to primary production.

The research and development undertakings in the Eastern Cape have been associated with wool and mohair, chicory, sugar beet, industrial hemp and other primary production outputs, and have clearly demonstrated the worth of such investigations. However, there can be little doubt that dedicated research and development investments need to be strengthened and supported in order to provide a sound basis for innovative industrial development that is sustainable and adds value to the province’s primary resource base. The recent establishment of an operational presence of the Industrial Development Corporation in the province is much appreciated, particularly in view of the IDC’s designated focus on the promotion of small and medium- sized enterprise development and black economic empowerment. Primarily, interaction with the IDC in the province indicates the emergence of a basis for co-operative initiatives to grow the economy through sustainable and innovative industrial development.

The Department of Trade and Industry strategies for strengthening and focusing the activities of the Ntsika Enterprise Promotion Agency and Khula Enterprise Finance are much appreciated in the province. These agencies have a key role to play in terms of both SMME development and black economic empowerment, but their interventions have not been particularly evident in the province. The revised approaches of Ntsika and Khula will be strongly supported by the Eastern Cape province, particularly through the reconstituted Eastern Cape Development Corporation.

However, the province concurs with the view that the Department of Trade and Industry’s restructuring process has not yet indicated clearly which structures and individuals will accord priority attention to the key areas of SMME promotion and effective black economic empowerment. The department of economic affairs, environment and tourism is committed to assisting the Department of Trade and Industry in these respects, particularly through the activities of the ECDC.

The province welcomes the establishment of the Council of Trade and Industry Institutions and strongly recommends that a closer relationship between the Department of Trade and Industry and the Department of Provincial and Local Government be established with respect to strategies for local economic development.

The finalisation of the local government demarcation process has brought new challenges in the form of building effective capacity in the province’s six district municipalities in terms of formulating coherent local economic development strategies in the context of integrated development plans. It is imperative that the Department of Trade and Industry should play a more active part in ensuring that such LED initiatives are soundly established within the context of national industrial policy and support systems. The province acknowledges the sustained financial and technical support that the Department of Trade and Industry has provided with respect to the development of the Coega and the East London industrial development zones.

The IDZs represent a particular manifestation of local economic development which is directed towards the following key strategic objectives: The provision of effective economic infrastructure to serve as a basis for investment promotion; the establishment of opportunities for industrial investment through appropriate incentive packaging; the creation of opportunities for new industrial development that provides further scope for associated SMME investment and black economic empowerment; the provision of a basis for a sustainable export orientation linked to local industrial development; the provision of new opportunities for access to global supply chains, particularly in terms of motor vehicle and the motor components manufacturing systems; and the establishment of a framework within which to promote effective backward and forward linkages to establish integrated industrial development based on local value-added initiatives.

The promotion of LED initiatives also has a significant relevance in terms of the Integrated Sustainable Rural Development Strategy which has been established in the province through several pilot undertakings in the previously marginalised areas of the former Transkei. These projects provide significant opportunities for promoting the SMME and black economic empowerment strategies that underpin the Department of Trade and Industry’s key objectives.

The province looks forward to developing productive relationships, where relevant, with the Department of Trade and Industry’s family of institutions, which benefit significantly from transfer funds from the Department of Trade and Industry budget. Strengthening the relationship between the Department of Trade and Industry and such institutions is anticipated to be of benefit to the province, particularly where these provide significantly improved focus on SMMEs and black economic empowerment.

The province notes that there appears to be an increased alignment and sensitivity between the activities of the Department of Trade and Industry and the imperative to grow the national economy. In this regard, the department of economic affairs, environment and tourism will continue to give effect to the Department of Trade and Industry’s economic growth and development policies and strategy instruments, particularly to the extent that these serve to facilitate the imperative to grow the provincial economy.

The province strongly supports the strategic directions that have been adopted by the Department of Trade and Industry, and is in agreement with the amount allocated in terms of Budget Vote No 31: Trade and Industry. [Applause.]

Mr E S MBATHA (KwaZulu-Natal): Chairperson, hon members, it gives me great pleasure to participate in this debate this afternoon. Firstly, I would like to thank the hon the Minister for a very good strategic policy development his department has committed itself to. What is impressive about his strategic plan is that the restructuring of his department focuses on creating a world-class institution which is service-oriented and delivery-driven. The end result of this restructuring is to accelerate trade and investment in South Africa and the region. For this, we applaud the Minister.

Delivering his state-of-the-nation address on 9 February this year, His Excellency, the President of our country, said, and I quote:

The success of the integrated action plan we have just detailed will be measured by how it impacts positively on a number of key performance indicators including economic growth rates, employment levels, competitiveness, black economic empowerment and small business development.

What the hon the President was outlining here was the investment in the economic infrastructure which will be prioritised by the Government to support the high-growth area, the integrated rural development strategy and the urban renewal programme.

We welcome the move by the department to focus on enterprise development, with the emphasis on black economic empowerment and increasing the rate of sustainable small, medium and micro enterprise creation. This strategic plan is acceptable to our province.

We feel that more should be done, nevertheless, to make it workable and implementable. It cannot be overemphasised that the masses of the people from my province and all over the country are saying that our good policies should now be yielding fruit for them.

I want to address the key issues that affect our province of KwaZulu-Natal in which the DTI can assist us. The first is the one that the Minister has alluded to, which is that of speeding up the IDZs and the IPZs in our province. I am very glad that the Minister has actually refocused the department to address this issue.

The second, of course, is our Durban harbour, which should be upgraded, and the third is that we should upgrade our rail network system. The fourth is that we request the department to establish a more user-friendly export component with my province. The fifth deals with Ntsika and Khula, which should be of assistance to our previously disadvantaged people. It may be a little bit harsh of me to say that maybe they are not doing enough. There is an outcry that they are not seen to be addressing the core issues of our black people who have been previously disadvantaged. Perhaps I just want to request the department to be more focused on those needy people throughout the country. It is even worse for our people who are listed with the credit bureaus in the country, because they simply cannot get any financial assistance from our financial powerhouses in the country. I feel it is high time we did something, and the people of our province have sent me. I am sure this is an appeal from all over the country, asking that, where black SMMEs in our country are listed with the credit bureaus and so on, the department play a meaningful role to assist them in terms of addressing the issue of them getting financial assistance from Khula, Ntsika and others.

Without any further ado, our province does support the Budget Vote and we are looking forward to a fruitful year.

Ms M P THEMBA: Chairperson, I would like to congratulate the hon the Minister and his department on achieving the target set for achieving gender equality in top management. I hope that the provinces will follow suit.

The nationwide progress in social and economic development over the past seven years has not translated into proportional gains for women in South Africa to the extent that the ANC and the Government would have liked. A number of factors have played a role in this, including the lack of access to credit for female entrepreneurs, which limits the profitability and growth of their enterprises.

Secondly, there are the limited education and mobility and, in some cases, cultural barriers which restrict women’s contact with institutions that offer financial services and well as the high transaction costs and collateral requirements associated with making small loans. Thirdly, the need to balance home and market responsibilities places a major constraint on women’s earning capacity and productivity. Fourthly, the lack of affordable childcare forces women into jobs with flexible hours and locations, jobs that frequently result in lower earnings, discontinuities in work, limited mobility and lower levels of skill. Lastly, there is a serious lack of technology for the development and growth of their businesses.

Despite these restrictions, several effective strategies for reducing the barriers to women’s economic participation have emerged during the last seven years. Legislative changes such as the Recognition of Customary Marriages Act have made it possible for women to enter into contracts on their own, which will allow them to engage in economic activity. The Government has invested proportionally more into women in the areas of education, health, family planning, access to land and economic opportunities.

In addition, discriminatory legislation which prohibited women from accessing finance to start their own businesses has been outlawed by the Promotion of Equality and Prevention of Unfair Discrimination Act. To enhance the accessibility of science and technology to women in business, in particular SMMEs, a national programme of technology for women in business has been embarked upon by the DTI. Through targeted initiatives and the launching of the yearly awards ceremony, the department has succeeded in assisting women to move from the periphery into the mainstream of the economy.

Through its actions this Government has demonstrated a commitment and has done more than all the apartheid governments combined to create conditions which are conducive for the economic empowerment of women. It has done so because it believes that the economic empowerment of women will directly reduce poverty through substantial economic payoffs in higher productivity and more efficient resource use. It has also done so because it believes that women’s economic empowerment produces significant social gains in the form of lower fertility, better household nutrition and reduced infant, child and maternal mortality.

However, for the Government’s strategy to achieve further successes, it will need the support of the private sector. In addition, it will require intensified training for women already engaged in economic empowerment initiatives and skills training for those women who want to become engaged in the formal and informal economy. It will also need to revisit trade policies and programmes to ensure that it becomes truly gender neutral. This is particularly important in the face of the growing globalisation of trade.

Globalisation of markets is placing local sustainability under serious threat. This is a critical issue for women, particularly for women engaged in subsistence farming, micro enterprises and the informal economy. It is imperative therefore that the process of globalisation should be steered in a direction that will enhance local sustainability and increase women’s participation in the local and global economy. If gender concerns are not integrated into trade policies and programmes, the potential exists for the widening of the inequalities that already exist between women and men.

At this point I want to touch on another issue which I think has a major impact on women, namely consumer protection. Women are heading the household in many instances, which means that they are responsible for ensuring adequate food supplies for their families, but they are also the ones who are blamed if there is something wrong with their family’s food.

Women, many of whom lack consumer education, find it impossible to determine the freshness of food before purchasing it, because they cannot interpret the code data on every food product. Many retailers take economic advantage of this situation by leaving food products on their shelves which should have been removed months or even years before, placing women and their children at severe risk.

It is not only in respect of food products that women are at the receiving end of unscrupulous business practices, but also in the field of professional services and other goods. Being the department responsible for monitoring the adherence to consumer protection legislation by businesses, the DTI is in a good position to assist women in this regard. It should enforce consumer protection legislation more stringently by increasing the capacity of the statutory institutions established to monitor its legislation.

Greater attention should also be given to nonstatutory self-regulatory bodies with their own codes of conduct, unlike statutory professional bodies such as law societies and the Estate Agents Board that are obliged by legislation to assist consumers who have been subjected to unprofessional conduct on the part of any of their members. Nonstatutory professional bodies do not provide the same kind of protection to consumers. This is mainly because their membership is voluntary and they can withdraw if they disagree with any punitive measure adopted by the body.

Nonliability clauses in contracts is another area of concern. For example, it is standard practice for most car rental companies to have a nonliability clause in their rental contracts, which states that the company shall not be liable for any damage arising out of any defect in, or mechanical failure of, the vehicle, nor for any loss of property transported or left in the vehicle. The legal gap … [Time expired.] [Applause.]

Mr P NGCOBO (KwaZulu-Natal): Chairperson, Mr Minister, colleagues, four years ago some of us attended the Presidential Jobs Summit, which said that success, growth and development must be measured in terms of our economy’s capacity to create new jobs and to protect existing ones.

It is unfortunate that the debate between the Government and the trade unions has not, as yet, brought about a clear understanding of why employers are closing down their factories. From the trade union point of view, our tariff reduction has caused job losses. Although there is no scientific calculation to back this argument, the bottom line is that the private sector is busy shedding jobs.

KwaZulu-Natal cannot say which sector is creating jobs at the moment. Perhaps we need to conduct more studies in this regard. We need to congratulate the Millennium Labour Council on its commitment to striving to make South Africa the leading emerging market and the destination of choice for domestic and foreign investment, where investments are secure and can earn a competitive return measured over an appropriate term. In this regard, they have agreed to end the phenomenon of labour relations being an obstacle to employment-creating growth.

During the Easter holiday, the DA was busy phoning all the black entrepreneurs on behalf of their leader, Tony Leon, asking them to join their secret organisation that will fight the economic policies of this Government, namely Gear and the tax policies. The DA was asking them whether their companies were coping with the amount of tax they were paying to Government, which has led to so many company closures. [Interjections.] I would wish that the Minister deal with this political myth from the DA because it is misleading our SMMEs. The question of expanding the industrial base of our economy should contribute towards increasing labour intake and ensure an increased role of SMMEs and co-ops.

I would like to say to the Minister that once again the question of bringing PDI communities - communities of previously disadvantaged individuals - to the manufacturing sector must form part of our priorities. We must encourage the PDIs to be involved in production, rather than see them playing a marginal role outside the mainstream of our economy. At the moment there is no faction in KwaZulu-Natal that belongs to the PDIs.

Therefore, the question of access to capital should now be addressed seriously because Ntsika and Khula, at the moment, have failed us. I know that as Government we cannot afford to dish out moneys to private-sector companies, but at the moment the private sector is not willing to come to the party. Therefore, who should assist in this regard? In some cases we are told that the forms used by Government institutions are identical to the forms we get from the ordinary commercial bank.

Perhaps the Minister will have to consider asking the National Empowerment Fund to fill this gap. Our MEC is busy right now trying to push Ithala Development Finance Corporation into playing this role, because we cannot go on like this any more. [Applause.]

Ms G S SINDANE (Mpumalanga): Malibongwe … [Praise …]

MALUNGU AHLONIPHEKILEYO [HON MEMBERS:]: … igama lamakhosikazi. [… the name of women!]

Ms G S SINDANE (Mpumalanga): Mr Chairperson, let me start off by commending the democratic Government for the sterling work it has done since its inception until the present time on the economy of this country.

In its seven years of reign, the new Government, through difficult policy choices, has managed to turn around the South African economy from one in which there was a complete meltdown to one geared towards economic growth and development. Today we have sound economic fundamentals in place which, in essence, serve as a strong base from which we can expand the economy even further.

Although progress has been made in terms of stabilising the economy, not so much ground has been covered in respect of poverty eradication and unemployment reduction. Looking at the province of Mpumalanga, for instance, statistics show that we currently have a population of approximately 2,8 million, with an unemployment level of 33%. The population growth is said to be 1,5% per annum, the highest population growth rate as compared to the other provinces.

The human development index is extremely low. We currently stand in sixth place out of the nine provinces. However, what is encouraging is that the provincial economy is growing at a rate of approximately 3,5% per annum, a figure which is higher than that of all the other provinces.

While we welcome these positive developments, I must quickly point out that the economic growth rate is far too low to begin to deal with the challenges currently confronting us. Like many provinces, we have embarked on strategies and processes aimed at enhancing economic growth that will lead to job creation. For example, we have a provincial growth and development strategy in place, with some of its aspects in the process of being rolled out.

Together with different stakeholders in the economy, we have embarked on a process of rolling out the Presidential Jobs Summit declarations, a process which began on 25 November 1999 to be precise. To date, we have managed to set up provincial implementing machinery which, I must quickly add, is functioning extremely well. The only problem that is currently blocking the way of this process is funding. We have knocked on the different doors of the various national funding agencies for help, but with little success, of course. This is really undermining all our efforts of trying to create a better life for our people, particularly those who live in abject poverty.

Our provincial small, medium and micro entrepreneurs’ development strategy is also failing to get off the ground in a meaningful way because of a lack of financial resources. Well-packaged and viable projects are gathering dust in our offices owing to a lack of access to funding. Commercial banks are no-go areas for small entrepreneurs. Even institutions such as Khula and Ntsika are of little help.

We know that the Department of Trade and Industry has been engaged in a restructuring process with a view to removing some of the blockages that I have just highlighted. We gratefully extend our warm welcome to such a process, which will strengthen our delivery in the provinces. We also take pride in the employment of women in senior positions. This process needs to be emulated by the provinces.

However, infrastructure development is another area of concern. We really appreciate the fact that the Government has started to pay more attention to this area. Once we have gotten the infrastructure improved and developed in Mpumalanga, believe me, the benefits will be enormous for our previously disadvantaged people, especially around tourism and agriculture.

In conclusion, as a province we would like to support the Budget Vote as presented by the hon the Minister towards the betterment of the lives of our people. [Applause.]

Mnr A E VAN NIEKERK: Geagte Voorsitter en agb kollegas, nywerheid en handel is die twee aktiwiteite wat aan die land die middele moet verskaf wat vir elke ander aktiwiteit benodig word. Dit skep onder meer welvaart en ‘n gesonde sosio-ekonomiese klimaat, of moet dit skep, waarin ander aktiwiteite Suid-Afrika die broodnodige ekonomiese groei kan gee.

Die agb Minister probeer baie hard en hy doen ook goed wat dit betref, maar ongelukkig word hy ook in die steek gelaat deur sy ANC-kollegas en -leierskap. Ons wens hom nietemin baie sterkte toe. (Translation of Afrikaans paragraph follows.)

[Mr A E VAN NIEKERK: Chairperson and hon colleagues, industry and trade are the two activities that must provide the country with the resources that are required for every other activity. They create, or should create, inter alia, greater prosperity and a sound socioeconomic climate in which other activities can provide South Africa with crucial economic growth.

The hon the Minister is trying very hard and is, moreover, doing well in this regard, but unfortunately he is being let down by his ANC colleagues and leadership. We wish him much success, however.]

It is encouraging to learn that 82% or R1,8 billion of DTI’s budget of R2,2 billion for the current financial year is earmarked for incentives which support business. As South Africa’s economic growth can and should be export-led, the fact that R260 million or 12% of the budget will be allocated to the Trade and Investment South Africa programme is to be welcomed.

The successes that the Minister, in collaboration with private enterprise is enjoying in the automotive industry must be mentioned, and we congratulate the Minister on that.

An aspect which, however, remains a source of concern is the fact that the development and promotion of SMMEs, which can and should play a vital role in South Africa’s economic growth and the eradication of unemployment and poverty, does not seem to be getting off the ground. Excuses for failure are not good enough, and the fast-tracking of all the plans and policies, as stipulated by the Minister here today, is of the essence.

The almost R26 million loss suffered by Khula in the year ending March 2000 is unacceptable. The Khula chairperson’s explanation that this dismal performance should be blamed on mismanagement, fraud, a lack of business, managerial and entrepreneurial skills and - hon members must hold their breath - rampant corruption is bad and unacceptable. Not only should Khula take tough action against offending participants, but the job creation drive should also be put back on track. However, it might also be prudent that it examine its own management and control systems.

It is therefore to be welcomed that both parliamentary committees have indicated to the DTI that in future, during the course of the budget year, periodic reports on the realisation of outputs will be requested. Die drastiese daling in besteebare inkomste en die verandering in bestedingspatrone is aan die volgende faktore toe te skryf: die geweldige toename in HIV/Vigs-verwante sterftes, die toename in die gebruik van sellulêre telefone, die impak van voorskieters van kontant of ``cash loans’’, en die geweldige bedrae wat aan dobbelary en loterye bestee word.

Die voorsitter van die Nasionale Dobbelraad het trouens in April 1998 gesê: (Translation of Afrikaans paragraphs follows.)

[The drastic decrease disposable income and the change in spending patterns are attributed to the following factors: the tremendous increase in HIV/Aids-related deaths, the increase in the use of the cellular telephones, the impact of providers of cash or cash loans, and the tremendous amounts which are spent on gambling and lotteries.

In fact, the chairperson of the National Gambling Board said in April 1998:]

… gambling is a very sensitive industry, and it can become a liability if not run properly … [He also said: never lose sight of the ordinary citizen and the damage we can do to him.

Die agb Minister het in Augustus 1999 ook klem gelê op die moontlike negatiewe en sosio-ekonomiese gevolge van dobbelary. Ook die Minister van Maatskaplike Ontwikkeling het onlangs sy kommer oor die nadelige maatskaplike gevolge van dobbelary uitgespreek.

LUR Makweya van die Noord-Kaap wat vroeër hier was, het vanmiddag te kenne gegee dat die slegte sosio-maatskaplike omstandighede in die Noord-Kaap die gevolg is van onwettige dobbelhuise.

Ek is bevrees dit gaan nie verbeter wanneer daar wettige dobbelhuise is nie. Wanneer die groot konsortiums begin toeslaan, gaan die situasie in die Noord-Kaap net vererger en in ‘n arm provinsie soos die Noord-Kaap kan dit net slegter gaan.

In November verlede jaar was daar reeds 22 casino’s met ‘n totaal van 13 741 dobbelmasjiene en 471 dobbeltafels in bedryf. Ons moet ons nie bluf nie, nuwe geld word nie deur dobbelary geskep nie. Ek herhaal: Nuwe geld word nie deur dobbelary geskep nie, dit is net ou geld wat geherkanaliseer word.

Asof dit nie genoeg is dat die room reeds deur casino’s en die lotery afgeskeep word nie, word die ingebruikstelling van beperkte uitbetalingsmasjiene beplan. Ek wil ‘n versoek tot die Minister rig: In die lig van dit wat ek gesê het en in die lig van vanoggend se werksessie wat ons in die komitee gehad het, wil ek hom versoek om goed na te dink voordat finale goedkeuring vir die ingebruikstelling van hierdie masjiene gegee word.

‘n Ander kwessie is internetdobbelary. Daar is ook nog nie duidelikheid hier oor nie. Ek hoop die Minister sal ons kan help.

Uit die terugvoer van die provinsies vandag in die komitee daar by mnr Moosa, het dit geblyk daar is werklik baie min, indien enige, voordele aan dobbelary in Suid-Afrika wat ons ekonomies en sosio-maatskaplik opgewonde kan maak. Daar moet weer gekyk word na die vergelyking wat tussen Suid- Afrika en ander lande getref is as regverdiging vir dobbelary. Die blote feit dat ons minder dobbelplekke het as ander plekke in die wêreld is mos nie ‘n regverdiging vir die situasie as ons kyk hoe dit sosio-maatskaplik met ons mense gaan nie. Dit is werklik nie nodig om die res van die wêreld na te volg ten koste van veral die voorheen benadeeldes van ons samelewing nie. Kom ons herbesin hieroor.

Voorsitter, ek maak klaar. (Translation of Afrikaans paragraphs follows.)

[The hon the Minister also placed emphasis on the possible negative and socioeconomic consequences of gambling in August of 1999. The Minister of Social Development also recently expressed his concern about the harmful social consequences of gambling.

MEC Makweya of the Northern Cape, who was present here earlier, acknowledged this afternoon that the poor social welfare conditions in the Northern Cape were the result of illegal gambling houses.

I am afraid that this will not improve when there are legal gambling houses. When the large consortiums start moving in, the situation in the Northern Cape will only deteriorate, and in a poor province such as the Northern Cape things can only get worse.

In November of last year there were already 22 casinos with a total of 13 741 gambling machines and 471 gambling tables in operation. We must not fool ourselves, new money is not created by gambling. I repeat: New money is not created by gambling, it is merely old money that is rechannelled.

As if it were not enough that the cream is already being skimmed off by casinos and the lottery, the introduction of limited payout machines is being planned. I would like to make an appeal to the Minister: In the light of what I have said, and in the light of the working session we had this morning in our committee, I would like to request him to think carefully before final approval is given for the introduction of these machines.

Another matter is that of internet gambling. There is no clarity on this matter either. I hope the Minister will be able to assist us.

From the feedback of the provinces today in the committee with Mr Moosa, it appeared that there are in fact very few, if any, benefits of gambling in South Africa that can excite us economically or socially. We have to revisit the comparison that was made between South Africa and other countries as justification for gambling. The mere fact that we have fewer gambling places than other people in the world is surely no justification for the situation if we look at the social welfare of our people. It really is not necessary to follow the rest of the world at the expense of especially the previously disadvantaged of our society. Let us reconsider this.

Chairperson, I am concluding.]

The DEPUTY CHAIRPERSON OF COMMITTEES: Thank you, Mr Van Niekerk.

Mr A E VAN NIEKERK: Kan ek klaarmaak, Voorsitter? [May I finish, Chairperson?]

The DEPUTY CHAIRPERSON OF COMMITTEES: Yes.

Mr A E VAN NIEKERK: Ek wil die Minister net bedank. [I would just like to thank the Minister.]

The DEPUTY CHAIRPERSON OF COMMITTEES: Your time has expired, sir.

Mr A E VAN NIEKERK: I beg your pardon, sir?

The DEPUTY CHAIRPERSON OF COMMITTEES: Your time has expired.

Mr A E VAN NIEKERK: Thank you, sir.

Mr M E SURTY: Mr Chairperson, today I hold the brief of the province, and I have been assigned to carry out that particular task. Much as I am tempted to respond to the issues raised by Mr Van Niekerk, I am quite satisfied that the hon the Minister is capable of dealing with those issues and concerns. Therefore I will devote myself diligently to the task that I have been assigned to do. [Interjections.] Very commendable indeed.

In terms of the profile of the province, the North West is a province that is committed to eradicating poverty and also concerned about the fact that more has to be done in terms of integrated rural development, and it is a province which has to generate approximately 60 000 jobs annually. In terms of the profile of the North West province, we will discover that the annual per capita income of the North West province is much lower than the national norm.

The percentage of people living in poverty is 53% as compared to the 47% of the national norm. The unemployment rate is 45% as opposed to the national norm of 40%, which obviously is a projection. I am not going to say that these are verifiable statistics - they emanate from the information that has been transmitted to me. Lastly, the human development index is 0,52 as opposed to 0,58.

The North West province has certain strategic advantages and these are, among others, the following:

It is geographically located in a very strategic position in the Southern African region; it has rich resources, particularly in platinum and gold; it has a competitive business environment; it has a very supportive provincial government; it is on the transportation crossroads, and with the platinum corridor that will soon enter our province, it will take people from Maputo right to Namibia through the North West province, right through the town that I live in, Rustensburg; it is in close proximity to some of our largest trading partners in the Southern African region, such as Botswana, Zambia and Zimbabwe; and, lastly, it has a very unique and significant tourist profile.

The key economic sectors of our province - I do this on the basis of an overview - are mining, agriculture, manufacturing and tourism. These will, in fact, form the cornerstone of our economic development.

The North West has established what is known as Invest NorthWest, and I think that the hon the Minister and the department are aware of this development which will play an important role with regard to establishing and promoting economic development in the province. It is one of our province’s most important institutions for opening up our economy, raising our competitiveness and restructuring our economy over the medium to long term.

On 15 March this year, Invest NorthWest was relaunched in Rustenburg. The theme of the launch was ``Putting North West at the centre of the cutting edge of globalisation’’, reflecting the commitment of the department in establishing a world-class institution. In addition, Invest NorthWest will actively encourage both domestic and foreign investments in the province through each phase of the investment and promotion value chain.

A specific focus of Invest North West will be in agroprocessing, high-value- added manufacturing, mineral beneficiation, information and communications technology, niche-market tourism, and trade and transport infrastructure and services.

The hon the Minister has referred to the industrial development zones, or IDZs, that have been established in the Eastern Cape and there is, in fact, an appeal from my province, and I speak as a spokesperson and ambassador for the province, that when the application by the North West for the establishment of an IDZ in the Mafikeng area called the Mafikeng international airport industrial zone - that is the proposed nature of the application - is received, it should be considered favourably.

Mafikeng has a population of approximately 285 000 people. It has a per capita annual income of R10 674, which is R3 467 less than the South African average. Its poverty rate is 55%, 8% more than the average poverty rate of South Africa. It has a higher unemployment rate and a lower human development index than the national norm.

If this development is approved by the Ministry, it will establish, in terms of the viability and analysis that has been undertaken by the province, 36 000 jobs; it will increase the total labour remuneration for new jobs by an amount of R2 billion; unemployment will decline from the current 52% to 37%; household income will increase by 64%; it will spearhead economic development in the region; it will contribute R3,3 billion to the gross geographic product, resulting in more than double the district’s GGP; the manufacturing sector will grow by more than 1 000%; and substantial growth is also projected for transport at 210% and the construction sector at 90%.

These factors have been brought to my attention in order that I may raise them with the Minister in connection with an application for such a zoning, which application has either been submitted or will soon be submitted to the Ministry, and I am taking advantage of this particular situation.

If I may depart from the text of my speech for a while and raise certain issues, I would like to commend the hon the Minister for fulfilling his commitment to the NCOP during the course of last year. He told us quite clearly and categorically that he would be addressing the issue of globalisation, which, in fact if I may say so, he has done in a very constructive way, and also dealing with issue of co-operative governance in a more meaningful way, particularly with regard to SMMEs.

The mere fact that the Ministry has already established provincial offices in the provinces is an indication of the good faith and the goodwill on the part of the Minister. But it does appear as if events have somewhat overtaken that kind of strategy, and I would like the hon the Minister to give us his views, and I am sure that he has paid sufficient attention to the fact that with the demarcation of new municipalities, local government has become a very important sphere in generating economic development.

I am of the view, given the fact that we have already established through the Ministry, provincial offices, that the Local Government: Municipal Structures Act clearly provides three important elements. We have the integrated development plan, which has to be developed locally through local governments and provincially through provincial governments, and which is synergised with national priorities. I believe that it is in this particular area that the department can play a very important role in guiding members of the councils in developing and adopting appropriate economic strategies for the development of that particular environment.

I have spoken about an area that requires development, but now I would now like to go to an area which is reasonably well developed and has enormous potential for economic growth, and which seems to be overtaking the rural challenges that face the region in the rapid urban development that is occurring there, and I am talking about the city that I come from … [Interjections.] [Laughter.] I am talking about Rustenburg.

Rustenburg has a budget which is equivalent to the budgets of all the cities and towns in the North West. It is the fastest growing city in the North West and is amongst the fastest growing cities in the country. It will also form an intrinsic part of the platinum corridor, and it has expanded its platinum mines to the extent that over the next five years there is a projection of a requirement of approximately 10 000 houses for the employees of the mines alone. This in itself creates enormous opportunities.

What has also happened is that the demarcation has resulted in a combination of regions which were somewhat separate and different in character. For example, the Bojanala district council, which previously comprised four regions, now combines the eastern region, from which Rev Moatshe comes, which is engaged quite significantly in industrial production, motor production and other industries, whereas Rustenburg has traditionally been a mining area, but significant industrial development is now occurring there.

In this context, it is my respectful view that if at all a meaningful role can be played by the department it should be in terms of the kind of support and guidance that it could give to local governments by establishing the appropriate industrial zones and industrial development strategies, particularly in the light of the fact that we are in a global situation.

May I perhaps just conclude with one important element. The former Bophuthatswana government had embarked on a somewhat unsuccessful industrial development plan. We have a place called Mogwase, which has an enormous infrastructure in terms of factories and industries. It has a population that is skilled and which could service that particular area. Here again is an example of where one could, in fact, without an enormous capital injection, establish the appropriate industrial development strategy to enhance the economic development of the area.

I do believe my time has expired, Chairperson. I will not abuse your latitude. [Applause.]

Mr K D S DURR: Chairperson and hon Minister, what can one say in three minutes? Not very much!

However, I would like to say that I do associate myself very strongly with all the remarks made by my hon colleague Van Niekerk about gambling in particular. I cannot understand how we can try to foist a gambling culture on communities that have never had a gambling culture. I mean, what is a casino doing in a place like Caledon? Those people know nothing about casinos, and it is just the wrong place, the wrong thing to do, the wrong time and the wrong way for society to waste its scarce resources.

Given the growing evidence that we also see from the Human Sciences Research Council of the terrible impact that this has on the lives of ordinary people, let me say that people are not so bright - I mean, they are obviously not so good at maths. They cannot do their calculations, because they should know that the table is always against them. And we have lower middle class people wrecking their lives. And what do we do? We say … [Interjections.] I know that the Minister …

The CHAIRPERSON OF COMMITTEES: Order! It seems that there is a bit of noise, and the hon member is becoming inaudible. Please, continue, hon member. [Interjections.]

Mr K D S DURR: I know that the Minister is concerned and I respect that. I respect this Minister, I have to say, in all he does, and I respect the fact that he is obviously approaching this problem viewing it seriously, because it is a serious situation. But I would like to ask the Minister if it is not possible to place a moratorium on the issuing of new licences until such time as we do have more certainty about what the situation in our country is. Perhaps that is the way forward. Perhaps we should just pause and try and find out what exactly is going on before we possibly compound our error.

Can I just say to the Minister that it is no good for us to compare ourselves to post-industrial economies like the Australians. I say, with respect, that we are not a post-industrial economy. We are a preindustrial economy in many respects and we do not have a long-term culture of gambling. What we had, which we inherited from the old order, was bad to start with and we simply must not compound that error any further. But that is enough on that.

There has been progress. The Minister has had successes. Not the least is the hard fact that exports are up from 1995 by 113% and imports are up by 77.5%. Well, that is good for those in the trade and industry business; they are trading and their industry is growing. The difficulty is, of course, that in the process … [Interjections.] The DEPUTY CHAIRPERSON OF COMMITTEES: Order! Hon member, on what point are you rising?

Rev M CHABAKU: Mr Chairperson, I would like to raise a point of order: While I share the sentiments of the hon member concerning gambling, I do not think that this House should be on record as condoning aspersions on the characters of those people whom he labels as “not bright”.

The DEPUTY CHAIRPERSON OF COMMITTEES: Order! Hon member, that is not a point of order. Will you please continue, hon member. [Interjections.]

Mr K D S DURR: I was talking about their mathematical ability, because they obviously have not done the sums about the odds against them as far as the gambling table is concerned. One can never beat the odds against the table. The table always wins.

I was saying that exports and imports were up, but on the negative side we see that … [Interjections.]

Mr M V MOOSA: Chairperson, one would have thought that the hon member on the floor would have left the matter. [Interjections.] Yes, I am raising a point of order. I really think it merits a point of order when a member decides to call citizens of our country in one or the other region or sector “not bright”. I think he must withdraw that statement or else not make such statements. It is an insulting statement. [Interjections.]

Mr K D S DURR: The Human Sciences Research Council tells us that 50% of people that are gambling are spending more than their monthly salaries on gambling. I have to say that that cannot be an intelligent thing to do.

On the negative side, we see that employment is down over the same period. I have said that imports and exports have gone up, but employment has come down over the same period. It is very hard to generalise on these issues, and it is a complex and multifaceted debate.

However, the trends are interesting. That is, if we were to look at a single issue, I would have to say that I would nominate lack of confidence

• lack of confidence in ourselves and that of others in us, sometimes justified by our actions or those of others in our region, sometimes not. But it is interesting if one looks … [Time expired.] Mr D SILKE (Western Cape): Mr Chairperson, it gives me great pleasure to enter this debate today representing the Minister of business promotion and tourism, in the Western Cape provincial parliament Mr Leon Markowitz. As chairperson of the standing committee on economic development in the Western Cape provincial parliament, I am particularly delighted to make my first input before this esteemed body.

We in the Western Cape are only too mindful of the need to promote our province and our country as a whole in developing sound trade relations, export programmes and industrial development. At the outset, let me say that it is indeed refreshing to note an improved commitment on the part of the national Department of Trade and Industry to assist us and to engage the provinces to a degree not adequately done in the recent past. Indeed, I would say that we are fully committed to co-operative governance, and I think there are now signs from the national DTI, in terms of their relationship with provinces as outlined by the Minister, of a renewed commitment and vigour in this regard.

I am therefore particularly pleased that the Department of Trade and Industry has drawn up a top 10 chart of local industries to power a major new export drive and reverse the recent slowdown in export growth. In particular, the Western Cape is likely to benefit from the selection of processed agricultural products such as wine and fruit juices, fresh fruits, boats and yachts, and clothing and textiles. These industries have been earmarked as critical to our economy, and I think this drive will bode well for our economy and that of the broader South Africa.

Such are the Western Cape’s priorities in the field of the promotion of trade and industry in terms of serving all our people within our province and providing a gateway into South Africa and into Africa as a whole that I would practically like to outline some of the initiatives that we have taken in this regard. I do believe that we have been at the forefront of some practical and innovative initiatives and I would like to highlight these to hon members today.

Minister Erwin has spoken about the importance of competitiveness and the global world, which I think are extremely crucial. He has already spoken about the idea behind a knowledge economy. Now indeed the thrust of the Western Cape’s economic policy is that of preparing the province for the knowledge economy of the 21st century. To this end, a draft White Paper has already been approved by Cabinet. Essential to this policy is what we call the Cape Online Programme, which aims to harness the power of information and communications technology to improve service delivery to our citizens and businesses. The goal will be to make it easier for business and individuals to deal with government, an initiative I know is also part of the national DTI strategy.

It is essential to cut the proverbial red tape. International studies continue to show that the more bureaucracy we have, and the more limited access we have to government, from government to the people and from people back to government, the more we impede investment domestically and also impede domestic productivity as a result thereof.

We in the Western Cape intend maximising our use of technology. An example of a project in this area will be the Bandwidth Barn project, an IT incubator unit which promotes the start-up and growth of IT ventures in the small to medium enterprise sector. This will get under way during the coming financial year in collaboration with the University of Cape Town.

These projects have, of course, one broad end in mind: that of improving the Western Cape’s competitive position, both domestically and in a broader regional and even international context, and attracting increasing amounts of investment to create more jobs for the people of the province. Coupled with the development of a world-class convention centre, just beginning to get under way, we believe that we are well positioned for solid growth and delivery.

I now wish to turn to the issue of the Western Cape liquor industry. Here I do believe that in terms of formulating a liquor policy, we in the Western Cape have certainly played a critical role. Specifically following the judgment of the Constitutional Court on 11 November 1999, the Western Cape embarked on a process to provide for liquor legislation for the province in accordance with that very judgment.

A policy-drafting panel consisting of experts was appointed with the task of compiling a draft policy document. The policy-drafting panel consulted with a wide range of interested parties before submitting the document for approval to the provincial Cabinet on 11 April 2001, only three weeks ago, in fact. A Green Paper has been published for comment and it is intended that there will be provincial legislation in this regard, hopefully by January 2002. The Western Cape is the only province that has, up to now, embarked on a process of providing provincial legislation regarding liquor licensing as provided for by the Constitution.

The Green Paper on liquor licensing is a realistic attempt to provide access to the formal liquor trade for the majority of liquor traders, most of whom currently trade illegally, by providing a user-friendly application procedure and doing away with archaic requirements. The Green Paper has further taken notice of the lack of community awareness of licence applications and participation by the community in licence applications and it provides for proper notice to affected parties. The Green Paper further provides for the lodgement of liquor licence applications with the local authorities in the province and the participation of such authorities in the entire process. Stricter penalties for transgressions of the law and noncompliance of licence conditions are provided for. The intention is therefore to make licence applications easier for those who intend trading legally, but bringing the full weight of the law to bear on those who disregard it.

Provision has also been made for educating the users and the general public of the responsible use of liquor. I do believe that this is a vitally important issue, not only to restructure the liquor industry itself, but also, I do believe, to promote responsibility when dealing with liquor. It is such a transversal issue that affects so much of what we do and specifically budgets, be they health or social services.

On the issue of foreign trade and investment, our directorate within the department of economic affairs has been working closely with our investment arm, Wesgro, to encourage new investments. In fact we have had some notable achievements over the past year NGK Ceramics, the first Japanese investment into this particular province, a Malaysian tourism investment totalling more than R1 billion and a R60 million German investment into the film industry.

Close to R2 billion in new investments was facilitated during the past year, and over 1 500 new jobs have thereby been created. Notably the Western Cape is considering opening a trade advice office in Europe, and as I speak in this House, the Premier of this particular province and the relevant Minister are holding an important press conference to outline the benefit of their recent visit to the state of California, where a number of exciting investments and trade initiatives were discussed. [Interjections.]

On export support, the directorate has redirected its efforts from the planned export development centre to a pilot export development programme, which is actively supporting 20 emerging companies over the period of this year. If successful, the programme will be extended to a far wider audience.

The Minister has already made reference to the free-trade agreement between the EU and South Africa and, indeed, this particular agreement and the Africa Growth and Opportunity Act hold enormous promise for the province’s manufacturing and agricultural sectors, not only for the Western Cape of course, but for all provinces.

In our particular case the take-up and adoption of opportunities created as a result of this have actually been relatively weak. It is our department’s intention to undertake research into these opportunities and market them strongly to local firms.

In my address on our Vote in the provincial legislature of the Western Cape some weeks ago, I did make the point that I wondered whether departments, I think this applies on a provincial basis, are adequately informing local businesses and small to medium enterprises about the benefits and advantages of the trade agreements. Do small businesses actually know what it means for them and are they able to take up those particular niches that are being made available through such important agreements?

We, in the Western Cape, have gone a long way, of course, also in addressing the issue of SMME development, and we absolutely understand the critical importance of this particular sector. To that effect we have developed a pilot developmental model which we are introducing this year and which holds a number of strategic initiatives.

These include enabling SMMEs to access finance via provincial, national and international agencies and to access private equity and venture capital. This is something that we are providing for all the people of our province, particularly the disadvantaged SMMEs, and I think it is an exciting project.

I therefore, Chairperson, wish to thank you very much and thank the Minister. We, of course, will co-operate fully in the betterment of the lives of all the people of our province and of South Africa. [Applause.]

Mr B A MNGUNI (Free State): Chairperson, hon Minister and colleagues, in support of the Department of Trade and Industry Vote, I would like to raise the following issues which are of concern to the province and which I have been mandated to raise here.

SMME development in the province is, at the moment, painstakingly slow. This is partly due to the fact that some funds were suspended in the previous two years owing to the poor repayment of loans by SMMEs. The Free State Development Corporation stopped some of those loans to SMMEs so that there could be some improvement in the payment of the loans.

As a result, development and promotion of SMMEs in the province are very slow. However, we would like to urge the national Department of Trade and Industry to be more visible in the province. We really welcome the setting up of offices in provinces. I think that will go a long way in addressing our issues. [Interjections.]

I would further like to see Ntsika and Khula playing a more prominent role in promoting SMME development in our province. In order to increase the pace of delivery, there must be an integrated approach in SMME promotion in the province. At the moment there is a separate approach, as far as planning is concerned and as far as implementation of projects is concerned.

The national department does its own planning and implementation of programmes. Provincial departments also do their own planing and implementation of programmes. If there could be synergy and if the departments could plan together, it would, in our view, go a long way in addressing the promotion of SMMEs in the province. [Interjections.]

The Free State is said to be the second poorest province in the country. At the moment we are starting to feel the effects of massive retrenchments around the former Goldfields district, originally Lejweleputswa, owing to mines, or shafts, closing down because Anglo Gold, formerly Anglo American, is pulling out of the province.

As a result high levels of technology that are needed to mine deep seated gold ore reserves and so forth, it is difficult for SMMEs to enter or to venture into that industry. As far as mining is concerned, it would be appreciated and, I think, welcomed by SMMEs if the IDC could help in this regard. And they should not only look at existing bigger businesses that are buying up all those mines to the disadvantage of our people who worked in those mines and who have no expertise other than mining underground. [Interjections.]

To further promote SMME development in the province and to put the province in the mainstream of the economy as well as to promote sustainable growth, we feel that some of the pilot projects conducted by the DTI should consider going to less advantaged provinces. Most of the pilot projects are concentrated around Gauteng, KwaZulu-Natal and the Eastern Cape. We would really welcome it if the DTI could consider capacitating those provinces and, in a way, promote SMMEs by taking some in the pilot projects to those provinces who are struggling at the moment.

As a result, economically, the Free State depends on mining and agriculture. The declining mining industry has created a lot of problems for us. It has resulted in people migrating or moving away from the Goldfields to the former QwaQwa area, now called Maluti a phofong. When they go there, they have no work, they have got nothing to live on.

We hope and think that if there were to be in place a programme to beneficiate our fresh produce from agriculture, as well as our gold products around the mining industry, this could go a long way in improving the situation. One can see that in the former mining towns lots of businesses are closing down and the towns are turning into ghost towns at the moment. We feel and think that if there could be beneficiation of some sort of our agricultural produce, that could really help us. I would like to mention that around the area of Wesselsbron in the Lejweleputswa district or the Goldfields under the control of the Free State farmers one of the farmers there managed to make diesel out of sunflower seeds. I think the department, including the Departments of Minerals and Energy and of Agriculture, could look into the issue of how to further promote such beneficiation of agricultural products and at the same time address the issue of the creation of jobs around that area and further down the southern Free State where such a crop can be economically produced.

Lastly, while not fighting the battles of the MEC in the Free State, I would like to bring to the attention of the Minister that the MEC has made a strong representation to the committee that he has had discussions with the Minister for these projects to get off the ground in the Free State as well as in the industrial development zones, etc. Up to now those negotiations have not come to fruition. As I say, without fighting the MEC’s battles, we would appreciate it if those talks and negotiations could come to fruition. [Applause.]

The MINISTER OF TRADE AND INDUSTRY: Chairperson, it is impossible to respond to each of the many, many points that have been raised, but I would like to thank the colleagues in the House for dealing with many of these matters.

Let me just start my remarks by apologising for the Deputy Minister. She is representing us in the conference on the discussions between the African, Caribbean and Pacific countries and Europe and then later this month at the least developed countries conference at the United Nations. I should point out that one of the reasons that she would be attending the least developed countries conference is that she initiated a conference and invited people here to deal with the issue of gender and trade, and I think the conference was a great success. Accordingly, she has been asked to present the outcome of this conference at the meeting in Europe and to report back on this very critical issue of gender and trade.

She is also attending the ACP meeting because we, again on her initiative, initiated a workshop that we held here in South Africa with the 18 countries that are negotiating for the African, Caribbean and Pacific group with the European Union. We held, I think, a very successful workshop here where we went through some of the experiences we had gained in negotiating with the European Union and we hope that that could be of some benefit to the ACP countries in their negotiations.

Each province has spoken about its strategies and its needs. I would urge the portfolio committees and this House to become familiar with those strategies, because one of the issues that I think is important is the fact that our experience has shown that the provinces have developed strategies. In some cases these are very strong, in other cases there is a need for a lot more work.

But a common theme that needs to be there through all of the provinces is the ability to beneficiate our products. That is not something that the Government can come in and do. That requires careful planning and careful thought, and also requires accurate identification of what is possible and what is not possible.

For example, my colleague the MEC from the Northern Cape, Comrade Makweya, correctly pointed out that the Northern Cape, for example, needs to beneficiate. But we need to be clear what that would mean. So one of the strategies that we are working on with the Northern Cape is to try and beneficiate the mineral products close to where they are mined. This fits with the more general strategy by which people want to export less air and dirt and more value. We will try to do the same.

We have a more long-term strategy, which will take us some time, of moving our gas across towards the Northern Province. Depending on the circumstances that unfold in the next year or two, we can move the gas from the existing network that would link Mozambique, or we can try to start moving it from the Namibian and now South African fields that will produce gas.

This is quite a long-term strategy, so it is not something we can do tomorrow, immediately. But it will create important possibilities for the Northern Cape as a beneficiator of the product - not in the form of steel plants, because there people want to be closer to the ports, get the steel onto the ships and move, but by turning the ore into a beneficiated product that then goes towards the steel plants.

The same goes for the grapes that my colleague mentioned. This is a very sophisticated market these days. The hon member is quite right, in the Northern Cape we do need to improve the logistical flows. This is a joint project that we are working on because the quicker we can get those grapes to the market the better. But that requires volumes. It requires us to persuade the freight carriers that they should move out of Upington. One cannot just move out of Upington for three weeks of the year.

These are some of the practical problems that we have to deal with, and I think the more our colleagues in all the provinces are familiar with their own provinces’ programmes, the more we will see that this requires continuous hard work. One cannot just wish these things to happen. Hard work, planning and strategies will have to go on time and time again.

Let me touch very quickly on some of the points. With regard to Saldanha Steel, I think the IDC has made a presentation to this Parliament on that. Worldwide the steel industry has major problems. For Saldanha the impact of these is quite severe. We are committed, as IDC, to work with the other shareholder, Iscor, to put that right, and both shareholders will have to come to the party.

South Africa, quite clearly, does have a strategic advantage in steel in the long run. But we should understand that we are competing against some very large steel plants in Europe and the US which had their capital paid off by governments in the eighties. So it is a difficult industry. I am in discussion with the steel industry, with Iscor and others, to try and work out a national strategy for correcting the steel industry.

With regard to the broader question asked by the chairperson: Do we have strategies? Yes, we have strategies, but one thing one cannot do is foresee the future. No government attempts to foresee each and every little change in the future. So I think that the message that we have to be sending home as leaders of our provinces is that all industries will have to be adaptable, and this is a message we have been sending home continually.

The world changes very fast these days. That is what globalisation is all about. Industries that are rigid or highly dependent upon government subsidies or government protection are industries that are not going to be adaptable and will not be able to change.

The message we have to send to our industries is that they will have to adjust and change continually. That requires high-quality management, skilled workers, and an interaction between the private sector and the government at provincial government level to plan for the future as to what will happen.

The hon member Theron indicated that our budgets have not changed. I would urge him just to look more closely. I think he has got the figures wrong.

Mr J L THERON: Sorry! [Interjections.]

The MINISTER: Let me clarify the structure of the department because that might be the cause of some of the misunderstanding. The International Trade and Investment Development Division is not a gigantic department. It is much smaller division basically dealing with the strategising, analysis and negotiations. So one will not find funds going into Itidd. In fact, we tried to improve the efficiencies and this is the reason there is a change in Itid.

So the funds will be channelled more through Trade and Investment South Africa. Tisa will then administer for us funds such as the Export Marketing and Investment Assistance scheme, preshipment credit financing those kinds of activities.

A lot of the funds for the export drive will not be in either of those divisions. They will be going through the enterprise organisation directly into the enterprises. Tisa only deals with those funds which will be spent abroad to help companies to go abroad. We need a tremendous amount of the funds for export promotion in the small manufacturing development programme and elsewhere. I agree that it is sometimes difficult to see exactly where the funds are going in DTI.

We have made a lot of improvements and by next year I can assure the House that we will try to give greater clarity and present our budget more effectively in this sense. Across all of the DTI activities we will indicate those things related to exports. We will try and find those for the House and show what they look like. Regarding the presentation of the cross-cutting expenditure in DTI, I think my director-general and his team have done very well in improving the presentation of the budget. One can see it more clearly - it was done graphically and in colour - but because of the complexity of our budgets, we will try and help the House next time so that members will not make the same mistakes.

One of the problems which is inevitable in politics - we should not get blinded by it - is that we can all play political games today, tomorrow and the next day. We can shout at one another about mistakes. It is also futile and useless, because at the end of the day our economy depends on all of us working together. It depends on us making gigantic structural changes to our economy. Remember what we have to do as a people. We should forget our political hats.

We have to take ourselves from a racially divided society, from a highly protected inefficient economy, and we have to provide jobs for all of our people if we want to have a stable democracy. We have got to catch up and we have got to adjust to a world economy which is changing very rapidly. This is an immensely challenging task. I must say that all of us are doing very, very well.

At a reception last night I sat next to Jurgen Schrempp, and he made a very interesting comment. The meeting that they are having is of the international advisory council of Daimler Chrysler. Ex-president Bush serves on it, as well as people from Japan and all over the world. He said that they went through an analysis of all the economies at present and came to the conclusion that we are doing very well. This is a credit, but not one that we try to claim politically. This is a credit that we should all claim because it means hard work and it refers to the confidence factor that we are talking about.

We are all capable of shooting ourselves in the foot, but we should not try to get professional at it, which is what everyone seems to be very keen to do. We need to get down to it and make sure that this economy makes the structural changes that it has to make. I pointed out in my talk that one of the realities which we know of in this economy is that we are short of skills in relation to IT and other areas. We have had an appalling educational system that was not geared towards creating these skills. That is in black and white. We have got to get down to it and work on it.

Let me tell members a story. When I was in Hong Kong and I sat down with the Minister in charge of IT, he said to me that Hong Kong had a major structural crisis. They had a lack of skills in IT. Imagine if an economy that wealthy with a per capita income that is very, very high has this problem, then we will have it too. The truth is that all emerging economies are losing their IT skills fast. India does not worry because it is one of their biggest exports. For us it is more problematic. This focus on skills and training people is something that we really have to take seriously. We must work together and pull together on this matter. Politics is fun, and sometimes it is just bloody stupid, but building an economy is just plain hard work, working together, keeping a cool head, realising that one cannot do everything by tomorrow.

On SMMEs we must be realistic. It is not possible to build them overnight. It is not possible for Government to build SMMEs by spending money. That is not going to happen. Many things will have to change until we get a small and medium enterprise economy, particularly dominated by the majority of our people in this country. We have to work at it. It takes time.

Failures occurred within Khula. We have to expect that there will be a failure rate. I am actually surprised and sometimes say to the chief executive that even though I instructed him to be cautious, sometimes he should not be too cautious. In building SMMEs the rate of failure will be high. that is unfortunate for us, but we must expect it.

To ensure that people that deal with money are always honest is often difficult. I am happy with the controls that we had in place with Khula. It is a pity that the retail structures were there, but the people there were not honest. If we are going to build SMMEs, we should not attack failure. One of the points that the Americans make to us time and time again is that we in South Africa are too embarrassed by failure. No small business is going to succeed the first time. They fail.

The points made by the hon Mbatha about credit are things that we have to look at. One will not get SMMEs to succeed if, once they fail, one is never prepared to back them again. We have to be prepared to back SMMEs. We do not want incompetence, but we must accept that failure is likely to take place for the SMMEs. colleagues.

There are many other issues that were raised. One that we did not raise, and I thank the House for raising it through the hon member Themba, is consumer protection. This is one of our priorities in the department. While I have been Minister, certainly the area that I would readily acknowledge we have not succeeded enough on is the improvement of consumer protection in South Africa. This must be one of our priorities. My director-general and his team have made it one of our priorities. It requires us to strengthen the division dealing with commerce and regulation. It requires us to attract skilled and capable people to come in there. We have done some drafts of new consumer law. They are not to our satisfaction. We need to have further discussion. We need to put more resources into consumer protection. For families and for women I think this is very important.

I would acknowledge that as a real weakness on my part: not having generated sufficient momentum in the area of consumer law and consumer protection. We hosted a very exciting and interesting conference here on international consumer law. We have not done enough to change things. I think the provinces would have to concede that they too have not done enough on this matter, even though it is part of their competence. We need to begin changing that very much.

I would like to make one quick point to the Western Cape. I have said this to my colleague. I am not sure that they are following a wise route with the argument for a trade facilitation office in Brussels. I have given my views and opinions. I do not think that they will find that it is a particularly useful exercise. If we look around the world we will see that very few of those offices are set up by provinces. This is not some attempt to block out the Western Cape. This is merely to say I think they could do a lot more with the money here.

The competitiveness among provinces is healthy. I think that it is good that provinces attempt to compete. At the end of the day the competition must not be so destructive that we all shoot ourselves in the foot. We need to work together. I am very pleased with the level of co-operation we have from all provinces. We are doing well. I think we are working better together. This is a very hard job. I would like to end by thanking the director-general, because I think his new team is an exciting reflection of what a new South Africa can look like. It is a new team, which has done a tremendously difficult job for the first time in the history of DTI. We have senior women managers responsible for whole divisions, which is something that has never happened before. This team is doing something good.

We thank the House for its support. We will make and have made errors - that is inevitable. I think we are moving in the right direction. I thank hon members for their support. [Applause.]

Debate concluded.

The House adjourned at 16:49. ____

            ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS

                        FRIDAY, 6 APRIL 2001

ANNOUNCEMENTS: National Assembly and National Council of Provinces:

1. The Speaker and the Chairperson:

 (1)    Assent by the President of the Republic in respect of the
     following Bill:


     Firearms Control Bill [B 34D - 2000] - Act No 60 of 2000 (assented
    to and signed by President on 4 April 2001).

National Council of Provinces:

1. The Chairperson:

 The following papers tabled are now referred to the Select Committee on
 Security and Constitutional Affairs:


 (a)    Report of the Judicial Inspectorate for 2000.


 (b)    Report of the Department of Justice and Constitutional
     Development for 1999-2000 [RP 37-2001]. TABLINGS:

National Assembly and National Council of Provinces:

Papers:

1. The Speaker and the Chairperson:

 Report of the Auditor-General on the Financial Statements of Vote No 36
 - Welfare for 1999-2000 [RP 145-2000].

                      WEDNESDAY, 11 APRIL 2001

COMMITTEE REPORTS:

National Council of Provinces:

1. Report of the Select Committee on Economic Affairs, dated 28 February 2001:

 The Select Committee on Economic Affairs, having held public hearings
 on Job Creation Estimates arising from Industrial Participation
 Programmes linked to Strategic Defence Arms Procurement Programme,
 reports as follows:


 A.     Introduction


       In its Fourteenth Report, dated 30 October 2000, the Standing
       Committee on Public Accounts of the National Assembly expressed
       "concern at the possibly optimistic estimations of jobs to be
       created" by the Industrial Participation Programmes linked to
       the Strategic Defence Arms Procurement Programme, and "advise[d]
       of its intention to request the Portfolio Committee on Trade and
       Industry to express its opinion on this" (ATCs, 2 November 2000,
       p 1057). In order to assist the Portfolio Committee in
       responding to this request, the Ministry of Trade and Industry
       and various research institutes specialising in these matters
       were invited to make submissions at a public hearing held on 6
       February 2001. Other interested parties also requested an
       opportunity to make written or oral inputs. The public hearings
       were held jointly with the Select Committee.
     1. Executive summary of oral presentations


          As several of the presentations raised matters that went
          beyond the specific matter referred to the Portfolio
          Committee, copies of all written material received were
          forwarded to the Standing Committee on Public Accounts, for
          its consideration. The following executive summary is of the
          main points made by those who made oral submissions:


          (1) Mr Alec Erwin, Minister of Trade and Industry


              The Minister indicated that his Department's involvement
              arose from its responsibility for the National Industrial
              Participation Programme (NIPP), which was approved by the
              government some years ago. The NIPP applies to all
              procurements by government structures where the imported
              component exceeds US $10 million. The Strategic Defence
              Arms Procurement Programme is subject to this broader
              policy. The decision to procure weapons stands on its own
              merits and follows Parliament's approval of the Defence
              Review in April 1998. The NIPP is not a simple "offset"
              programme. It is based on a more complex model that seeks
              to use major procurements by all government structures to
              leverage in investment. The model was developed after
              extensive study of international experience, and the
              government was well aware of the risks and dangers of
              "offsets". The Non-Defence Industrial Participation
              projects (NIPs) that were negotiated in relation to the
              weapons procurement programme were not selected on the
              basis of the value of the offers alone, but rather were
              ranked in terms of their potential contribution to
              broader industrial policy objectives. The projects
              selected and negotiated with suppliers were intended to
              create specific capacities in our industrial economy and
              focused, in particular, on specialist steel product
              production, auto components and other strategic sectors.
              Negotiators were specifically not mandated to seek
              performance bonds with a value greater than 10% of the
              purchase because there would then be a risk that the cost
              of the IP projects would inflate the purchase price.


              The Minister said that estimates of investment and job
              creation were undertaken as part of the risk and economic
              impact assessment. The business plans of the various
              projects indicated that 6 264 direct jobs would be
              created during the first 10 years, and a further 6 200
              over the following five years. The risk and economic
              impact assessment had been based on a more conservative
              estimate that 9 400 direct jobs would be created in the
              various projects by 2008, plus 4 000 direct temporary
              jobs in construction and a further 1 500 permanent jobs
              in steel mills. This gives a total of 14 900 direct jobs.
              This total was then multiplied by four to give an
              estimate of "indirect job" creation. The Minister said he
              was confident that these projections were attainable, and
              indicated that 15% of the projects measured by value had
              already begun to be implemented. The NIP projects were
              expected to yield an estimated R100 billion in knock-on
              benefits (export revenue plus investment). Non-defence
              industrial investment would total R24 billion.


          (2) Mr Guy Lamb, Prof Paul Dunne and Prof Richard Haines,
              Project on "Industrial Participation and Industrial
              Development" co-ordinated by Centre for Conflict
              Resolution


              The presentation was based on an ongoing research project
              on the implications of NIP projects for industrial
              development in the Eastern Cape and the Nelson Mandela
              metropole. The presentation began with a review of
              international experience with "defence offsets". From
              this the presenters concluded that while offsets can
              attract and focus investments, they also have the
              potential to distort and undermine an integrated
              industrial strategy. The presenters expressed the view
              that it was generally better to seek a price reduction
              through "off the shelf" purchases than to pursue
              "offsets". With reference to the Eastern Cape and the
              Nelson Mandela metropole, they suggested that there was
              tension between the NIP projects identified to be located
              in the Coega Industrial Development Zone and the
              trajectory of economic development identified for the
              area by the Eastern Cape provincial government and the
              municipality of the Nelson Mandela metropole. While
              acknowledging that their research was still in an early
              stage, the presenters suggested that "offsets" and
              defence-related industrial participation tended to focus
              on the periphery of the country's industrial strategy,
              and would tend to reinforce the reproduction of the
              "mineral and energy complex" rather than promote a more
              robust industrial development. The presenters argued that
              the projects appeared to have been selected through a
              "top down" process with little sign of an attempt to
              synergise with local economic development initiatives.
              They also questioned the validity of the procurement
              package in relation to the security needs of the country.


          (3) Mr Terry Crawford-Browne, Economists Allied for Arms
              Reduction (ECAAR)


              Mr Crawford-Browne argued that international experience
              showed that "promises of job creation related to arms
              acquisition are grossly exaggerated", and suggested that
              South Africa would be no exception. He alleged that many
              of the details of IP projects were hidden behind a veil
              of "commercial confidentiality" and called for greater
              transparency in this regard. He said that "offsets" had
              been prohibited in trade agreements between the European
              Union and the North American Free Trade Area because they
              were difficult to oversee and tended to distort economic
              activity. He warned that several of the projects would be
              likely to rely on imported skills rather than local human
              resource development, and said that research had shown
              that the corvette acquisition programme that was being
              negotiated by the previous government, would have
              resulted in a net loss rather than gain of jobs.


          (4) Mr Jeff Ashmead, Mr Ken Warren, Mr Gerald Wolman and Ms
              Peggy Drotskie, Sacob


              The presentation focused on identifying potential
              problems with counter-trade deals and certain principles
              to guide such transactions. The presenters expressed the
              view that counter-trade was not an ideal vehicle for
              industrial policy or investment promotion. Counter-trade
              tended to conceal prices and distort markets. Further
              drawbacks to such deals included the following:


              (a)  Inefficiency: International experience showed that
                   such deals often involve the payment of large
                   commissions to brokers, which amount to a "hidden
                   cost", making counter-trade an expensive and often
                   unprofitable way to trade.


              (b)  Complicated: A web of international transactions
                   often mean that the only beneficiaries from
                   transactions are intermediaries.


              (c)  Risky: The transactions involve commodities that are
                   price-volatile, and this is compounded by exchange
                   rate uncertainty.


              The reduction in world military expenditure, following
              the end of the cold war, suggested to Sacob that the
              international arms trade might be a buyer's market. This
              may present opportunities for South Africa to negotiate
              benefits from the international industry. While Sacob was
              wary of counter-trade deals, they did not suggest that
              the present deal be undone, but rather called for an
              accountable process, coupled with sufficient checks and
              balances and public transparency. They also called for an
              equitable spread of opportunities from offset
              arrangements.


          (5) Ms Tanya van Mierless and Mr Neil Coleman, Cosatu


              The presentation focused on the broader issue of the
              opportunity cost of the arms deal in comparison with the
              potential impact on the economy and job creation of
              alternative developmental projects. Cosatu argued that
              government spending has the potential to increase
              employment and enhance skills development. However, arms
              acquisition and the industrial participation projects
              linked to that programme would "aggravate the dichotomies
              in the economy and not narrow them". This was because the
              armaments industry was skill- and capital-intensive,
              dominated by white males, located in metropolitan areas
              and characterised by concentrated ownership. The defence
              industry also did not have a strategy to link itself to
              the civilian economy.


              Cosatu also argued that the arms procurement programme
              would redirect government spending away from social
              services to defence. This in turn would constrain
              employment growth and the social wage. The presenters
              believed that social service spending would decline in
              real per capita terms over the next three years, with
              broader implications for labour. The presenters said the
              industrial participation programmes did not include a
              sufficient training or employment equity component to
              counter such trends, and efforts to evaluate their impact
              in this regard were frustrated by commercial secrecy
              clauses. Cosatu called for more information to be
              released on the nature of investments in IP projects and
              on the new jobs to be created. In concluding, they
              recommended a parliamentary inquiry "if the channelling
              of resources is found to be problematic and the
              opportunity costs are found to be high".


          (6) Response by Minister Erwin


              The Minister said the point of departure of many of the
              submissions was opposition to the arms procurement
              programme and to the use of "offsets". The government had
              decided to make this procurement and would not seek to
              reverse the contracts it had entered into. It was also
              government policy to have an Industrial Participation
              Programme. The government was not blind to the problems
              encountered in "offset" programmes elsewhere, but many of
              the examples cited were not applicable to South Africa.
              The present deal was not being undertaken by an economy
              in dire straits desperate to find some mechanism to
              promote foreign investment. IP was an instrument, but not
              the sole instrument, of industrial policy.


              The Minister welcomed proposed research projects to check
              on the unfolding of the programme: To check whether a
              country with some industrial and negotiating capacity can
              succeed. The IP linked to the arms procurement was being
              used to enhance manufacturing and beneficiation of
              primary products by developing strategic capacity. A
              conscious decision had been taken not to try and sustain
              a massive defence industry producing a wide range of
              weapons systems. Current policy is aimed at retaining
              only certain areas of strength that could feed into the
              development of a modern industrial economy. Commission
              has not been paid to intermediaries, as the government
              chose to negotiate directly with the prime contractors.
              Every effort had been taken to liaise with provincial and
              local authorities over the design of projects.


 B.     Conclusions and recommendations


     As indicated above, the specific issue the Portfolio Committee was
     requested to "express [its] opinion on" was the estimations of the
     jobs to be created as a result of the Industrial Participation
     Programmes (both DIPs and NIPs) negotiated as part of the
     Strategic Defence Armaments Procurement package. In its report,
     the Standing Committee on Public Accounts expressed "concern at
     the possibly optimistic estimations" in this regard. We will
     confine our own remarks to the specific matter referred to the
     Portfolio Committee, and not offer any comment on the broader
     issues raised in many of the submissions made to us, which clearly
     fall outside the Portfolio Committee's terms of reference.


     Whether or not these estimates are "optimistic" would, in our
     view, appear to depend on the accuracy of the basis on which they
     are calculated and the degree to which the IP projects will, in
     fact, be implemented.


     The estimate of approximately 65 000 jobs, in fact, embraces jobs
     in various categories. Firstly, there are the jobs expected to be
     created in the specific IP projects agreed, or under negotiation,
     with the contractors - both DIPs and NIPs. These include both jobs
     in the factories or plants expected to be created by the various
     projects and also jobs expected to be created in the construction
     of those factories or plants. Both of these are called "direct
     jobs" - jobs that will be directly created by the projects. Not
     all of these will, however, be "permanent". The construction jobs,
     in particular, will last only as long as it takes to construct the
     factory or plant, thus they will be "temporary". Many of these
     could, in fact, be expected to have disappeared before many of the
     project jobs kick in. The estimates of "direct jobs", in other
     words, measure all the jobs that will be created over the period
     until 2008, and not the number of jobs that will exist at any one
     time. The maximum number of "direct jobs" existing at any one time
     will thus be less than the estimates of the total number that will
     be created over the entire period.


     In addition to "direct jobs", the estimates also include a number
     of "indirect jobs" that will be generated by the programme. These,
     we understand, relate to downstream and upstream activity that
     will be generated by the IP programmes. For example, if a steel
     mill is built it will require cement and will thus create demand
     for cement and cement industry workers. The number of "indirect
     jobs" is estimated on the basis of a multiple of the number of
     "direct jobs". Again the total refers to all the "indirect jobs"
     that will be created along the entire contract period, and does
     not necessarily mean that all these jobs will exist throughout the
     entire period. For example, the "indirect jobs" in the cement
     industry would be generated during the construction period. Once
     again, therefore, the maximum number of "indirect jobs" that will
     exist at any one time will be less than will be created over the
     entire contract period.


     According to the information provided by the Ministry of Trade and
     Industry, calculations based on the business plans of the NIP
     projects estimate direct job creation over the first 10-year
     period at an average of 6 264 jobs, or just over one tenth of 1%
     of non-agricultural employment of 5,95 million in 1998. Over the
     next five years, a further 6 200 new manufacturing jobs are
     expected, according to the business plans, to be created by these
     projects.


     The final affordability study was based on more conservative
     estimates. These were as follows:


     Total number of direct jobs created in various projects to 2008
     9 400.
     Total number of direct jobs in construction 4 000. Total number of
     permanent jobs in mills 1 500.


     Grand total of direct jobs 14 900.


     In calculating the number of indirect jobs, a multiplier of four
     indirect jobs to each direct job was selected. This was based on
     ratios used in various econometric modelling exercises applicable
     to the economy as a whole, and compares to a ratio of 10 indirect
     jobs to one direct job, which the Ministry says was achieved in
     some other non-Defence-related National Industrial Participation
     Programme projects. Applying the multiplier of four to the figure
     of 9 400, 11 900 or 14 900 gives a range of indirect jobs from
     37 600 to 59 600.


     The figure of approximately 65 000 (actually 64 165) direct and
     indirect jobs was based on a different method of working back from
     projected investments, export orders and domestic turnover. This
     yielded a result in the same range as the calculations conducted
     for the affordability study.


     The Ministry also told us that several of the projects (13 out of
     a total of 70 projects) had already started. The number of direct
     jobs created or retained in these projects to date was as follows:
     BAA/SAAB (six projects)1 358
     Agusta (two projects) 177
     Thyssen (one project) 70
     Thomson (three projects) 378
     Ferrostaal (one project) 60


     Total (13 projects) 2 043


     Taking into account the record of actual direct job creation to
     date, the estimates of expected direct job creation arrived at by
     three different methods of calculation do not seem to us to be
     overly optimistic, provided of course that the contractual
     obligations of suppliers are complied with. We have not
     interpreted the Portfolio Committee's mandate as requiring of it
     to pronounce on whether or not it thinks the NIP contractual
     obligations will actually be fulfilled. We concur with Public
     Accounts that " ... the economic benefit of these NIPS [is] a
     significant part of the bigger "value-for-money" composition of
     the arms deals, and as such sees a strong responsibility on the
     part of the government to enforce them" (ATCs, p 1057). Minister
     Erwin indicated to us that the government was committed to
     achieving this and, as indicated above, some 15% of the total
     projects measured by value have already begun to be implemented.


     As far as the indirect jobs are concerned, the estimates rest on
     econometric assumptions that the Committee does not feel qualified
     to comment on. We cannot, in other words, offer any useful comment
     on the assumption that four "indirect" jobs will be created for
     each "direct" job; it may be higher or lower. This depends on
     opinions about econometric models that are used by the government
     for other purposes. It also depends on one's views on a matter
     raised explicitly in the Cosatu submission and implicitly in some
     of the others as to whether or not there is an "opportunity cost"
     in terms of job creation from the decision to procure weapons, as
     against using the resources for other purposes.


     Some of the confusion and misunderstanding about the job estimates
     appears to us to arise from not fully understanding the way in
     which the figures were arrived at, and perhaps from "optimistic"
     presentations or expectations in some quarters that misinterpreted
     or misunderstood the total to be created along the contract period
     as the number of jobs that would exist at any one time. Some
     confusion or misunderstanding of the 65 000 total as the direct
     jobs that would arise from the projects also seems to have been
     evident in some quarters.


     It would seem to us that, from the point of view of parliamentary
     oversight, whether by Public Accounts or other committees,
     including this one, what is needed is a relatively rigorous and
     clearly measurable set of indicators against which actual
     performance can be assessed. The estimate of direct jobs used for
     purposes of risk and economic impact assessment seems to us to
     offer a relatively clear, coherent and realistic set of
     estimates/targets. We would, therefore, recommend that assessments
     of outcomes of both DIPS and NIPS as far as job creation is
     concerned, should be based on estimates of "direct" jobs.


     The Committee would like to thank all those who made submissions.
                       THURSDAY, 19 APRIL 2001

ANNOUNCEMENTS:

National Assembly and National Council of Provinces:

1. The Speaker and the Chairperson:

 (1)    The Joint Tagging Mechanism (JTM) on 18 April 2001 in terms of
     Joint Rule 160(3), classified the following Bill as a section 75
     Bill:


     (i)     Eskom Conversion Bill [B 16 - 2001] (National Assembly -
          sec 75) - (Portfolio Committee on Public Enterprises -
          National Assembly).

TABLINGS:

National Assembly and National Council of Provinces:

Papers:

1. The Minister of Finance:

 Forty-First Report and Financial Statements of the Registrar of Pension
 Funds for 1999.

1. The Minister of Correctional Services:

 Draft Regulations made in terms of section 134 of the Correctional
 Services Act, 1998 (Act No 111 of 1998) submitted to Parliament in
 terms of section 134(5) of the Act.

                       TUESDAY, 24 APRIL 2001

ANNOUNCEMENTS:

National Assembly and National Council of Provinces:

1. The Speaker and the Chairperson:

 (1)    The Minister of Minerals and Energy on 19 April 2001 submitted a
     draft of the Gas Bill, 2001, as well as the memorandum explaining
     the objects of the proposed legislation, to the Speaker and the
     Chairperson in terms of Joint Rule 159. The draft has been
     referred to the Portfolio Committee on Minerals and Energy and the
     Select Committee on Economic Affairs by the Speaker and the
     Chairperson, respectively, in accordance with Joint Rule 159(2).


 (2)    The Minister of Transport on 19 April 2001 submitted drafts of
     the Road Accident Fund Amendment Bill, 2001, and Airports Company
     Amendment Bill, 2001, as well as the memoranda explaining the
     objects of the proposed legislation, to the Speaker and the
     Chairperson in terms of Joint Rule 159. The drafts have been
     referred to the Portfolio Committee on Transport and the Select
     Committee on Public Services by the Speaker and the Chairperson,
     respectively, in accordance with Joint Rule 159(2).


 (3)    The following Bill was introduced in the National Assembly on 24
     April 2001 and referred to the Joint Tagging Mechanism (JTM) for
     classification in terms of Joint Rule 160:


     (i)     Gas Bill [B 18 - 2001] (National Assembly - sec 75)
          [Explanatory summary of Bill and prior notice of its
          introduction published in Government Gazette No 22162 of 23
          March 2001.]


     The Bill has also been referred to the Portfolio Committee on
     Minerals and Energy of the National Assembly.

COMMITTEE REPORTS:

National Council of Provinces:

1. Report of the Select Committee on Economic Affairs on Budget Vote 31: Trade and Industry, dated 27 March 2001:

 The Select Committee on Economic Affairs, having examined Budget Vote
 31: Trade and Industry for the 2001-02 financial year, as well as the
 forward estimates for 2002-03 and 2003-04 included in the Estimates of
 National Expenditure, reports as follows:


 A.     Main features of Budget


     1. The Department is allocated R2 214,6 million for the financial
          year 2001-02, while forward estimates anticipate it receiving
          R2 465,1 million and R2 625,9 million in the years 2002-03 and
          2003-04, respectively. This compares to the R2 116,4 million
          voted in last year's Budget, which rose to R2 245,4 million in
          the adjusted appropriation for 2000-01. The Department's
          Budget for 2001-02 is broadly in line with last year's forward
          estimate for 2001-02 (which was R2 264,2 million), but the
          amount anticipated for 2002-03 represents an increase of 12,6%
          over last year's forward estimate for 2002-03, which was
          R2 332,2 million. The Department's Budget can thus be
          described as a constant Budget with minor fluctuations.


     2. The 2001-02 Budget is divided into five programmes, compared to
          the previous four. They are Programme 1 - Administration (4%
          of the total); Programme 2 - Trade, International Trade and
          Economic Development (1%); Programme 3 - Enterprise and
          Industry Development (46%); Programme 4 - Enterprise
          Organisation (34%); and Programme 5 - Trade and Investment
          South Africa (15%). The new programme structure arises
          directly from the restructuring of the Department and provides
          for better correspondence with the Department's major
          operational divisions.


     3. The Budget for Programme 1 is increased from R107,4 million in
          the adjusted appropriation for 2000-01 to R148,7 million in
          2001-02. This relates mainly to the establishment of a new
          Executive Management Unit in the Department.


     4. The Budget for activities falling under Programme 2 is
          increased from R23,4 million in the adjusted appropriation for
          2000-01 to R28 million in 2001-02. The main activitities
          budgeted for under Programme 2 are multilateral and bilateral
          trade negotiations, the promotion of African economic
          integration and the activities of the Commission for
          International Trade Administration (previously known as the
          Board for Tariffs and Trade).
     5. The Budget for Programme 3 is reduced from R955,4 million in
          the adjusted appropriation for 2000-01 to R835,8 million in
          2001-02. Programme 3 is the Department's largest programme and
          includes most of the Department's services and supply-side
          incentives to businesses, including its dedicated small
          business and black economic empowerment promotion programmes.
          85,5% of the expenditure under Programme 3 consists of
          transfer payments. The decrease in expenditure in the present
          budget year is largely due to the financial independence of
          the Competition Commission and the cessation of contributions
          to the National Empowerment Fund.


     6. Programme 4's Budget is increased from R819,7 million to R942,2
          million, with an anticipated further rise to R1 268,9 million
          in 2003-04. The most significant factor behind the expected
          increase in respect of this programme is the implementation of
          new investment incentives and industrial support measures.


     7. Programme 5's Budget decreases from R339,5 million to R259,8
          million. The main reason for this is expected reduced
          contributions to the Export Credit Reinsurance Fund.


     8. A feature of this year's Budget is the inclusion in the
          Estimates of National Expenditure of a table of "expected
          outputs" and "service delivery indicators" for Programmes 2 to
          5. A further simplified list of "deliverables" was also
          included in the presentation to the Committee by the Director-
          General. Together, these offer, for the first time, measurable
          targets against which the Department's actual performance can
          be assessed.


     9. Transfer payments account for 82,5% of the total Budget. A
          significant part of these transfer payments are made to
          associated "family institutions". There are now 18 public
          entities and three other bodies that report to the Minister of
          Trade and Industry. They now participate in regular meetings
          of the newly established Council of Department of Trade and
          Industry Institutions (CDTII).


     10.     There has been a welcome improvement in the Department's
          record on spending. The amount of the 2000-01 Budget not spent
          at the end of the financial year was R80 million, but could be
          reduced to R60 million if the National Treasury approves
          certain virement requests. This compares to the underspending
          of R600 million, more than a quarter, of the total Budget for
          1999-2000.


     The Committee had an opportunity to engage on budgetary issues
     with four of the Department's associated institutions - the
     Industrial Development Corporation, the Council for Scientific and
     Industrial Research, Ntsika and Khula. Highlights of these
     discussions are included below.


 B.     Industrial Development Corporation (IDC)


     1. The IDC aims "to be the primary driving force of commercially
          sustainable industrial development and innovation" through,
          inter alia, "identifying and supporting opportunities not yet
          addressed by the market". It is largely self-financing and
          pays dividends to its sole shareholder, the State.


     2. The IDC provided investment assistance of R4,2 billion (5,9% of
          the fixed investment in the South African economy) last year.
          It is also extensively involved in the SADC region, where it
          has 30 projects in nine countries.


     3. The IDC reported encouraging progress in its efforts to promote
          small and medium enterprise development as well as black
          economic empowerment. Over the past five years, it has shifted
          focus away from large capital-intensive projects. 42,3% of its
          total funding approved for projects last year went to small
          and medium-sized companies, compared to 11% in 1998. The
          proportion of approvals going to empowerment firms increased
          from 6% to 27% over the same period.


     4. The IDC remains financially strong, with assets of R17,4
          billion and a retained income last year of R631 million. It
          faces, however, a risk arising from its involvement in two
          poorly performing steel projects - Columbus and Saldanha. We
          were told that, worst-case scenario, the IDC could lose R4
          billion if Saldanha were to fail. The IDC's leadership are,
          however, engaged in a major effort to turn Saldanha Steel
          around, linked to a broader process of restructuring the South
          African steel industry.


 C.     Council for Scientific and Industrial Research (CSIR)


     1. The CSIR provides scientific and technological support for
          industrial development. 60% of the CSIR's funds emanate from
          clients and contracts. They will receive R302,8 million from
          the government in 2001-02, while forward estimates anticipate
          this falling to R301 million in 2002-03, before rising to R312
          million in 2003-04.
     2. The CSIR reported that there was now a much improved working
          relationship with the Department. They participate in meetings
          of the CDTII, and now have a formal co-operation agreement
          with the Department.


     3. The CSIR indicated that there is a worrying trend towards
          declining private sector involvement in research and
          development (R&D). A number of key private sector facilities
          have been downsized, outsourced or moved offshore recently,
          including facilities at Plesseys, AECI, Anglo-American, De
          Beers, Dow Chemicals (previously Sentrachem), the Chamber of
          Mines, Fishing Industries Research and Iscor. While robust R&D
          work continues to be carried out by some private companies and
          parastatals (e.g. Sasol, Telkom and Eskom), this, we are told,
          is becoming "the exception rather than the norm". The last
          time South Africa's gross expenditure on R&D was measured, was
          in 1997, when the total expenditure was R4 013 million (0,69%
          of GDP). Approximately 50% of this was then financed and 55%
          was actually performed by business.


     4. Against this background, the CSIR delegation expressed concern
          at the trend towards progressively reducing government
          spending on R&D. They said that government spending on R&D now
          represented 0,34% of GDP, which was less than those in many
          developed countries (trading partners), and which placed us in
          the same league as Greece and Mexico. No comparative figures
          for developing countries were provided.


 D.     Ntsika Enterprise Promotion Agency


     1. Ntsika is seeking to refocus its activities. It considers its
          current mandate to be too broad, and wants to shift away from
          its current main activity of accrediting service providers to
          a demand-driven provision of particular services to small
          business.


     2. Five integrated programme areas are envisaged:


          (1) Supplier Development - aimed at developing capacity of
              potential entrepreneurs and enhancing that of those
              considering expansion.


          (2) Market Development - aimed at identifying potential market
              opportunities for small business.


          (3) Business Linkages - promoting links to suppliers and
              collaborative activity.


          (4) Policy Design - involving research on SMME development.


          (5) Business Generation - aimed at promoting Ntsika's
              services.


     3. Ntsika is allocated R35 million in the current Budget, and it
          is anticipated that it will receive R50 million in 2002-03 and
          2003-04. Ntsika also plans to generate own funding and donor
          support to boost its available funding by a further R60
          million by 2004. The allocation this year represents a
          reduction on last year's allocation of R50 million in the main
          Budget, which rose to R50,750 million in the adjusted
          appropriation.


     4. Ntsika's long-term future depends on decisions still pending
          about the restructuring of small business support programmes
          by the Department.


 E.     Khula Enterprise Finance


     1. Khula's priority objectives for 2001-02 include
          recapitalisation as a matter of urgency, and formalising
          future capital and grant funding arrangements with the
          Department.


     2. Khula says that it needs R1,2 billion for recapitalisation over
          the next few years to support a somewhat expanded programme of
          activities. It plans to expand its business loans and its
          guarantee, equity fund and institutional support portfolio
          from R462,4 million at the end of 2000-01 to R662,9 million by
          the end of 2001-02. As a result of ongoing negotiations with
          banks, bank guarantees are expected to increase from R380,9
          million to R506,2 million. In terms of job creation/outreach,
          Khula expects to increase its impact from 198 912 persons/jobs
          at the end of 2002 to 254 483 by the end of 2004.


     3. Khula requested R200 million from the Department for
          recapitalisation during the 2000-01 financial year and
          received a total of R141 million. No provision is made in the
          present Budget for a contribution to Khula's recapitalisation
          - only for grant funding of R20 million. Various assurances
          have, however, been given by the Ministry that this matter
          will receive attention.


     4. The organisation suffered an operating loss of R25 million in
          2000, largely due to the collapse of two non-governmental
          retail finance institutions in which Khula had a R40 million
          exposure.


     5. Khula also indicated that it would be seeking exemption from
          taxation.


     6. It is still not certain that Khula-supported activities are
          sufficiently benefitting target groups in disadvantaged
          communities. Between 1998 and 2000, the guarantee programme
          received over 600 applications from white-owned businesses,
          compared to just over 400 from African-, 200 from Asian- and
          50 from Coloured-owned firms.


 F.     Comments


     The Portfolio Committee on Trade and Industry of the National
     Assembly, on the 2000-01 Budget, noted that ..."expected outputs
     have not been clearly indicated and quantified with the result
     that no real base to measure impact has been provided". We are
     pleased to note that there has been considerable improvement in
     this regard in the present Budget. As indicated above, included in
     the Estimates of National Expenditure and in a simplified form in
     the Director-General's presentation to the Committee is a list of
     expected "outputs" and "deliverables" from each of the main
     programmes. These are not always as quantified or measurable as we
     would like, but do provide a basis for regular monitoring of the
     performance of the Department. The Committee has for some time
     included in its programme periodically focused engagements with
     the Department, at which it requests, inter alia, a report on the
     Department's performance against the Budget. The Committee has
     indicated to the Director-General and the Department that in
     future interactions during the course of the present budget year,
     it will request periodic reports on the extent to which the
     "outputs" and "deliverables" identified in the two documents
     indicated above have been realised. This, we believe, will
     considerably enhance our oversight of the Department's work.
     The Committee notes that there is considerable improvement
     generally in budgeting and budgetary control by the Department.
     Programmes are more closely aligned to the major activities of the
     Department, more effective financial reporting and control systems
     are in place and, as indicated above, the trend evident in
     previous years of significant underspending seems to have been
     corrected.


     The Department continues to define its fundamental task and
     strategy as being to grow the economy, through -


     1. facilitating access to sustainable economic activity and
          employment;


     2. raising the level of investment;


     3. increasing market access;


     4. promoting a fair, efficient and competitive market place for
          businesses and consumers.


     Last year, the Committee was told that the Department had chosen
     to focus its various activities in 2000-01 on three key
     objectives:


     *  Promoting Small, Medium and Micro Enterprises (SMMEs);
     *  Empowerment;


     *  Investment.


     While we appreciate that the Department was preoccupied with
     restructuring last year, it is not clear to us that SMME promotion
     and empowerment have received the priority attention they should
     have. We appreciate and support the Department's position that
     SMME promotion and empowerment need to cease being "ghettoised"
     and need to become the focus of the activities of the Department
     as a whole. However, it seems to us that the restructuring
     exercise has not yet reached the point where it is clear which
     structures and individuals will give focused attention to these
     priority activities. The long-term future of Ntsika still has to
     be decided, although it is said in general that its activities
     will be drawn more closely towards those of the Department. This
     contrasts, for example, with Trade and Investment South Africa
     (TISA), where considerable progress has already been made in
     merging the former Investment South Africa (ISA) with the new
     structure. A strategy for the recapitalisation of Khula, linked to
     improved performance and focus, is also clearly urgently needed.
     It is the Committee's earnest hope that the creation of new
     structures to more effectively promote SMMEs and empowerment will
     receive urgent attention in this budget year.


     The Committee also draws attention to the following:


     (a)     The indication by the CSIR that there may be a reduction
          in involvement by private companies in research and
          development, is a cause for concern. Clearly this is a matter
          that requires further investigation. It also adds a new
          dimension to the debate on desirable targets regarding
          government support for parastatal institutions involved in
          science and technology, like the CSIR. The Committee plans to
          engage further on this matter, both with the Department and
          the CSIR.


     (b)     The IDC has a critical role to play in promoting
          industrial, SME and empowerment strategies. Significant
          progress has been made in advancing these objectives in recent
          years. The potential risks associated with the IDC's exposure
          to the problems associated with Saldanha Steel cannot be
          allowed to jeopardise its effectiveness in this regard. While
          the IDC leadership appears optimistic to be able to turn
          around Saldanha, it is clearly a matter that needs to receive
          the priority attention of the Department as well as the IDC.

                       THURSDAY, 26 APRIL 2001

ANNOUNCEMENTS:

National Assembly and National Council of Provinces:

1. The Speaker and the Chairperson:

 (1)    The following Bill was introduced in the National Assembly on 26
     April 2001 and referred to the Joint Tagging Mechanism (JTM) for
     classification in terms of Joint Rule 160:


     (i)     Export Credit and Foreign Investments Re-insurance
          Amendment Bill [B 19 - 2001] (National Assembly - sec 75)
          [Explanatory summary of Bill and prior notice of its
          introduction published in Government Gazette No 22249 of 24
          April 2001.]


     The Bill has also been referred to the Portfolio Committee on
     Trade and Industry of the National Assembly.


 (2)    Assent by the President of the Republic in respect of the
     following Bill:


     Special Investigating Units and Special Tribunals Amendment Bill
    [B 9B - 2001] - Act No 2 of 2001 (assented to and signed by
    President on 11 April 2001).

TABLINGS:

National Assembly and National Council of Provinces:

Papers:

1. The Minister of Water Affairs and Forestry:

 Reports of Water Boards -


 (1)    (a)   Annual Report and Financial Statements of the Albany Water
             Board ended February 1997.


       (b)   Annual Report and Financial Statements of the Albany Water
             Board ended February 1998.


       (c)   Annual Report and Financial Statements of the Albany Water
             Board ended June 1999.


       (d)   Annual Report and Financial Statements of the Albany Water
             Board ended June 2000.


 (2)    Annual Report and Financial Statements of the Amatola Water
     Board ended June 1999.


 (3)    (a)   Annual Report and Financial Statements of the Bloem Water
             Board ended February 1997.


       (b)   Annual Report and Financial Statements of the Bloem Water
             Board ended June 1998.
       (c)   Annual Report and Financial Statements of the Bloem Water
             Board ended June 1999.


 (4)    Annual Report and Financial Statements of theBushbuckridge Water
     Board ended June 2000.


 (5)    (a)   17th Annual Report and Financial Statements of the
             Goudveld Water Board ended February 1997.


       (b)   18th Annual Report and Financial Statements of the
             Goudveld Water Board ended June 1998.
       (c)   19th Annual Report and Financial Statements of the
             Goudveld Water Board ended June 1999.


 (6)    (a)   1st Annual Report and Financial Statements of the Ikangala
             Water Board ended June 1999.


       (b)   2nd Annual Report and Financial Statements of the Ikangala
             Water Board ended June 2000.


 (7)    (a)   Annual Report and Financial Statements of the Kalahari
             East Water Board ended February 1997.
       (b)   Annual Report and Financial Statements of the Kalahari
             East Water Board ended February 1998.


       (c)   Annual Report and Financial Statements of the Kalahari
             East Water Board ended February 1999.


       (d)   Annual Report and Financial Statements of the Kalahari
             East Water Board ended February 2000.


 (8)    (a)   Annual Report and Financial Statements of the Kalahari
             West Water Board ended February 1997.


       (b)   Annual Report and Financial Statements of the Kalahari
             West Water Board ended February 1998.


       (c)   Annual Report and Financial Statements of the Kalahari
             West Water Board ended February 1999.


       (d)   Annual Report and Financial Statements of the Kalahari
             West Water Board ended February 2000.


 (9)    (a)   Annual Report and Financial Statements of the Karos
             Geelkoppan Water Board ended February 1997.


       (b)   Annual Report and Financial Statements of the Karos
             Geelkoppan Water Board ended February 1998.


       (c)   Annual Report and Financial Statements of the Karos
             Geelkoppan Water Board ended February 1999.


       (d)   Annual Report and Financial Statements of the Karos
             Geelkoppan Water Board ended February 2000.


 (10)   (a)   Annual Report and Financial Statements of the Lepelle
             Northern Water Board ended June 1998.


       (b)   Annual Report and Financial Statements of the Lepelle
             Northern Water Board ended June 1999.


       (c)   Annual Report and Financial Statements of the Lepelle
             Northern Water Board ended June 2000.


 (11)   (a)   Annual Report and Financial Statements of the Magalies
             Water Board ended February 1997.


       (b)   Annual Report and Financial Statements of the Magalies
             Water Board ended June 1998.


       (c)   Annual Report and Financial Statements of the Magalies
             Water Board ended June 1999.


       (d)   Annual Report and Financial Statements of the Magalies
             Water Board ended June 2000.


 (12)   (a)   Annual Report and Financial Statements of the Mhlathuze
             Water Board ended February 1997.
       (b)   Annual Report and Financial Statements of the Mhlathuze
             Water Board ended June 1998.


       (c)   Annual Report and Financial Statements of the Mhlathuze
             Water Board ended June 1999.


       (d)   Annual Report and Financial Statements of the Mhlathuze
             Water Board ended June 2000.


 (13)   (a)   Annual Report and Financial Statements of the Namakwa
             Water Board ended February 1997.
       (b)   Annual Report and Financial Statements of the Namakwa
             Water Board ended June 1998.


       (c)   Annual Report and Financial Statements of the Namakwa
             Water Board ended June 1999.


       (d)   Annual Report and Financial Statements of the Namakwa
             Water Board ended June 2000.


 (14)   (a)   Annual Report and Financial Statements of the North West
             Water Supply Authority ended March 1997.


       (b)   Annual Report and Financial Statements of the North West
             Water Supply Authority ended March 1998.


       (c)   Annual Report and Financial Statements of the North West
             Water Supply Authority ended June 1999.


       (d)   Annual Report and Financial Statements of the North West
             Water Supply Authority ended June 2000.


 (15)   (a)   Annual Report and Financial Statements of the Overberg
             Water Board ended February 1997.


       (b)   Annual Report and Financial Statements of the Overberg
             Water Board ended June 1998.


       (c)   Annual Report and Financial Statements of the Overberg
             Water Board ended June 1999.


       (d)   Annual Report and Financial Statements of the Overberg
           Water Board ended June 2000.
 (16)   (a)   Annual Report and Financial Statements of the Pelladrift
           Water Board ended June 1998.


       (b)   Annual Report and Financial Statements of the Pelladrift
           Water Board ended June 1999.


       (c)   Annual Report and Financial Statements of the Pelladrift
             Water Board ended June 2000.


 (17)   Annual Report and Financial Statements of the Phalaborwa Water
       Board/Northern Transvaal Water Board/Bosveld Water Board ended
       March 1997.


 (18)   (a)   Annual Report and Financial Statements of the Rand Water
             Board ended March 1997.


       (b)   Annual Report and Financial Statements of the Rand Water
             Board ended June 1998.


       (c)   Annual Report and Financial Statements of the Rand Water
             Board ended June 1999.


       (d)   Annual Report and Financial Statements of the Rand Water
             Board ended June 2000.
 (19)   (a)   Annual Report and Financial Statements of the Umgeni Water
             Board ended February 1997.


       (b)   Annual Report and Financial Statements of the Umgeni Water
             Board ended February 1998.


       (c)   Annual Report and Financial Statements of the Umgeni Water
             Board ended June 1999.


       (d)   Annual Report and Financial Statements of the Umgeni Water
             Board ended June 2000.

                        WEDNESDAY, 2 MAY 2001

ANNOUNCEMENTS:

National Assembly and National Council of Provinces:

1. The Speaker and the Chairperson:

 (1)    The Minister of Finance on 2 April 2001 submitted drafts of the
     Financial Advisory and Intermediary Services Bill, 2001, and the
     Financial Institutions (Protection of Funds) Bill, 2001, as well
     as the memoranda explaining the objects of the proposed
     legislation, to the Speaker and the Chairperson in terms of Joint
     Rule 159. The drafts have been referred to the Portfolio Committee
     on Finance and the Select Committee on Finance by the Speaker and
     the Chairperson, respectively, in accordance with Joint Rule
     159(2).


 (2)    The following Bills were introduced by the Minister of Transport
     in the National Assembly on 30 April 2001 and referred to the
     Joint Tagging Mechanism (JTM) for classification in terms of Joint
     Rule 160:


     (i)     Airports Company Amendment Bill [B 20 - 2001] (National
             Assembly - sec 75) [Explanatory summary of Bill and prior
             notice of its introduction published in Government Gazette
             No 21733 of 17 November 2000.]


     (ii)    Road Accident Fund Amendment Bill [B 21 - 2001] (National
             Assembly - sec 75) [Explanatory summary of Bill and prior
             notice of its introduction published in Government Gazette
             No 22251 of 24 April 2001.]


     The Bills have also been referred to the Portfolio Committee on
     Transport of the National Assembly.


 (3)    The Taxation Laws Amendment Bill [B 17 - 2001] (National
     Assembly - sec 77), which was introduced by the Minister of
     Finance on 5 April 2001 and referred to the Joint Committee on
     Taxation Laws Amendment Bill, was also, on that date, referred to
     the Joint Tagging Mechanism (JTM) for classification in terms of
     Joint Rule 160:

                         FRIDAY, 4 MAY 2001

ANNOUNCEMENTS:

National Assembly and National Council of Provinces:

1. The Speaker and the Chairperson:

 (1)    The following Bill was introduced by the Minister of Finance in
     the National Assembly on 4 May 2001 and referred to the Joint
     Tagging Mechanism (JTM) for classification in terms of Joint Rule
     160:


     (i)     Pension Funds Amendment Bill [B 22 - 2001] (National
          Assembly - sec 75) [Explanatory summary of Bill and prior
          notice of its introduction published in Government Gazette No
          21845 of 1 December 2000.]


     The Bill has also been referred to the Portfolio Committee on
     Finance of the National Assembly.

                         MONDAY, 7 MAY 2001

ANNOUNCEMENTS:

National Assembly and National Council of Provinces:

1. The Speaker and the Chairperson:

 (1)    The Joint Tagging Mechanism (JTM) on 7 May 2001 in terms of
     Joint Rule 160(3), classified the following Bill as a money Bill:


     (i)     Taxation Laws Amendment Bill [B 17 - 2001] (National
          Assembly - sec 77).


 (2)    The Joint Tagging Mechanism (JTM) on 7 May 2001 in terms of
     Joint Rule 160(3), classified the following Bill as a section 75
     Bill:


     (i)     Gas Bill [B 18 - 2001] (National Assembly - sec 75). 2.    The Speaker and the Chairperson:


 The following papers have been tabled and are now referred to the
 relevant committees as mentioned below:


 (1)    The following paper is referred to the Portfolio Committee on
     Correctional Services and the Select Committee on Security and
     Constitutional Affairs:


     Report of the Judicial Inspectorate for 2000.


 (2)    The following paper is referred to the Portfolio Committee on
     Justice and Constitutional Development and the Select Committee on
     Security and Constitutional Affairs:


     Report of the Department of Justice and Constitutional Development
     for 1999-2000 [RP 37-2000].


 (3)    The following papers are referred to the Portfolio Committee on
     Finance and the Select Committee on Finance:


     (a)     Explanatory Memorandum on the Taxation Laws Amendment
          Bill, 2001 [WP 1-2001].


     (b)     Government Notice No R.231 published in Government Gazette
          No 22139 dated 8 March 2001, Cancellation of appointment of
          authorised dealers in foreign exchange.


     (c)     Government Notice No R.238 published in Government Gazette
          No 22141 dated 9 March 2001, Draft Treasury Regulations
          published for comment in terms of section 78 of the Public
          Finance Management Act, 1999 [Act No 1 of 1999].


 (4)    The following paper is referred to the Standing Committee on
     Public Accounts for consideration and report. It is also referred
     to the Portfolio Committee on Social Development and the Select
     Committee on Social Services for information:


     Report of the Auditor-General on the Financial Statements of Vote
     No 36 - Welfare for 1999-2000 [RP 145-2000].

TABLINGS:

National Assembly and National Council of Provinces:

Papers:

1. The Minister of Foreign Affairs:

 (1)    Convention on the Privileges and Immunities of the United
     Nations, adopted by the General Assembly of the United Nations on
     13 February 1946, tabled in terms of section 231(2) of the
     Constitution, 1996.


 (2)    Explanatory Memorandum to the Convention.


 (3)    Convention on the Privileges and Immunities of the Specialised
     Agencies, approved by the General Assembly of the United Nations
     on 21 November 1947, tabled in terms of section 231(2) of the
     Constitution, 1996.


 (4)    Explanatory Memorandum to the Convention.


 (5)    Agreement on the Privileges and Immunities of the International
     Atomic Energy Agency, tabled in terms of section 231(2) of the
     Constitution, 1996.


 (6)    Explanatory Memorandum to the Agreement.

1. The Minister for Justice and Constitutional Development:

 (1)    Report of the Judicial Service Commission for 1999-2000 [RP 20-
     2001].


 (2)    Proclamation No R.17 published in Government Gazette No 22067
     dated 16 February 2001, Commencement of the Protected Disclosure
     Act, 2000 (Act No 26 of 2000) made in terms of section 11 of the
     Protected Disclosure Act, 2000 (Act No 26 of 2000).


 (3)    Proclamation No R.21 published in Government Gazette No 22159
     dated 23 March 2001, Commencement of the Judicial Matters
     Amendment Act, 2000 (Act No 62 of 2000), made in terms of section
     38 of the Judicial Matters Amendment Act, 2000 (Act No 62 of
     2000).


 (4)    Proclamation No R.20 published in Government Gazette No 22125
     dated 9 March 2001, Commencement of the Promotion of Access to
     Information Act, 2000 (Act No 2 of 2000), made in terms of section
     93 of the Promotion of Access to Information Act, 2000 (Act No 2
     of 2000).

                         TUESDAY, 8 MAY 2001

ANNOUNCEMENTS: National Assembly and National Council of Provinces:

1. The Speaker and the Chairperson:

 (1)    The Joint Tagging Mechanism (JTM) on 8 May 2001 in terms of
     Joint Rule 160(3), classified the following Bills as section 75
     Bills:


    (i) Export Credit and Foreign Investments Re-insurance Amendment
             Bill [B 19 - 2001] (National Assembly - sec 75).


     (ii)    Airports Company Amendment Bill [B 20 - 2001] (National
              Assembly - sec 75).

TABLINGS:

National Assembly and National Council of Provinces:

Papers:

1. The Speaker and the Chairperson:

 (1)    Report of the Auditor-General on the Financial Statements of
     Vote 16 - Home Affairs for 1999-2000 and the Performance Audit of
     the Migration Process [RP 125-2000].


 (2)    Report of the Auditor-General on the Financial Statements of the
     Independent Electoral Commission for 1996-97 and 1997-98 [RP 188-
     2000].

1. The Minister of Labour:

 Report of the Department of Labour for 2000-2001 [RP 50-2001].