TUESDAY, 15 MARCH 2005 __

                PROCEEDINGS OF THE NATIONAL ASSEMBLY

                                ____

The House met at 14:03.

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

ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS - see col 000.

                    ATTACK ON WARDERS AT HOSPITAL


                         (Draft Resolution)

Mrs S A SEATON: Madam Speaker, I move without notice:

That the House –

1) notes with sadness and shock that a prison warder, Mr J Horne, was
   killed and another warder was seriously injured yesterday after four
   armed men opened fire on the four warders who had brought a prisoner
   to Groote Schuur Hospital for treatment;


2) further notes that the fact that the attack took place at the
   hospital’s outpatients reception and put the lives of many innocent
   bystanders in danger is totally unacceptable;

3) sends its heartfelt condolences to the family of Mr Horne and wishes
   the injured a speedy and full recovery;


4) urges any individuals with information to assist the police in their
   investigations so that they can bring the individuals guilty of this
   inhumane crime to book; and


5) calls upon the Minister of Correctional Services to launch an
   investigation into this incident in order to avoid similar attacks,
   and the unnecessary loss of life, from occurring in the future.

Agreed to.

                    COMMONWEALTH DAY ON 14 MARCH


                         (Draft Resolution)

The DEPUTY CHIEF WHIP OF THE MAJORITY PARTY: Madam Speaker, I move the motion as it stands printed on the Order Paper in the name of the Chief Whip as follows:

That the House -


 (1)    notes that -


     (a)     the Commonwealth  Parliamentary  Association  has  observed
          Commonwealth Day on 14 March;


     (b)     the event entails a two-day  international  celebration  in
          London, from 14 to 15 March,  with  the  theme  ``Education  -
          Creating Opportunity, Realising Potential''; and


     (c)      this  theme  reflects  the  Commonwealth's  commitment  to
          education by promoting efforts to  achieve  universal  primary
          education, eliminate gender disparities,  improve  quality  in
          education, use distance learning to overcome barriers, support
          education in difficult circumstances and mitigate  the  impact
          of HIV and Aids in education;


 (2)    acknowledges the contribution of the Commonwealth  Parliamentary
     Association   in   strengthening   parliamentary   democracy    and
     interaction among members of Commonwealth parliaments; and


   3) joins the rest of the Commonwealth parliaments in observing  this
      event and wishes the participants fruitful celebrations. Agreed to


                         APPROPRIATION BILL


                       (First Reading Debate)

Dr R H DAVIES: Madam Speaker, the Budget offers a unique opportunity each year for parties represented in this Parliament to debate their alternative economic policy perspectives and through this to lay claim to the support of the electorate.

Perhaps, conscious of the difficulty in getting media attention in the context of the series of budgets that have been widely welcomed, the DA in the past few years has tried to jump the gun and released what it calls an Alternative Budget’’ on the eve of the Minister’s Budget’s Speech. This year’s offering, it would like us and the electorate to believe, is a comprehensive, costed policy platform’’ to raise growth and create conditions for ``large-scale job creation.’’

I am afraid, though, that in presenting these proposals the DA has once again let its slip show. Points 5 to 7 in the press release of this year’s ``Alternative Budget’’ are a call to abolish capital gains tax, estate duties and donations tax.

Now I ask: What on earth do these kinds of proposals have to do with improving economic growth and promoting job creation? These are taxes on actual or inherited wealth in the hands of wealthy individuals and are aimed at transferring into the fiscus what is in fact, by international standards, a modest proportion of funds that would otherwise be spent on luxury second homes and the like. Calling for the abolition of such taxes is nothing other than special pleading on behalf of the mink and manure brigade in the wealthy suburbs. By giving prominence to such demands, the DA has once again shown that its policies are driven not fundamentally by concerns to reduce poverty and unemployment, but rather by a concern to represent the backward instinct of the rich and privileged in resisting obligations to make an equitable contribution to development and growth in this country.

But let us for the sake of debate put that point aside and look at the growth model that underlies the alternative budget of the Official Opposition. The essence of their argument is that if the rich are, in their terminology, unshackled and allowed to get richer still, this will generate a few more crumbs to trickle down to the poor. What they don’t understand is Public Finance 101. Without critical public goods and services provided by government departments and public institutions, there will be no economic growth and job creation.

Public goods and services, they fail to recognise, must include programmes of infrastructural development, public investment and the provision of social security, as well as the more traditional services of safety and security, health and education.

There is also a need, in our context, for public goods and services to address manifest market failures – such as the inability of the market to provide sufficient skills development, micro-credit, etc. Taxes are necessary to raise revenue to fund such programmes.

While the present Budget offers reasonable and thought-through tax reductions targeted at improving the investment climate, particularly for small business, the Official Opposition’s proposals call for swinging cuts costed by ridiculous suggestions to close down departments or institutions like the Umsobomvu Fund and replace public services with the issuing of vouchers for services that frankly are not provided for in the market. This is not, I contend, a real programme for job creation and poverty alleviation; rather it is special pleading on behalf of the rich and privileged dressed up as something else. But enough of the pseudo-budget! Or is it the pseud’s budget?

Let me turn to the real Budget and highlight a few points in the report of the Portfolio Committee on Finance on the hearings it held on the macroeconomic dimensions of the Budget, which was published in the ATC of 9 March 2005.

I need to report to the House that the portfolio committee’s hearings have indicated that there is a broad consensus among economists and informed commentators that the National Treasury is correct and that we are on course for economic growth above 4% for the MTEF period. Minister Manuel, the debate on growth projections this year appears to be about tenths of a percent. That growth during the course of the MTEF will be above 4% appears to be agreed. This, we should note, means that we are on track and we are entering a phase, that will see the highest level of sustained economic growth in this country for more than three decades.

I need also to report that while most commentators agree that there are a number of international and domestic factors underlying this improved growth performance, prominent among them - all agree - is the record of sound economic management by this ANC-led government.

Also pleasing to report is that we are now seeing as a result of this growth net positive job creation. Jobs are now being created in this economy, although - we need immediately to record - not at a pace sufficient to absorb all new entrants into the labour market and most of the jobs that are being created are at higher skills levels.

Having said that, there are a number of features of our present higher growth trajectory that in the view of the portfolio committee need careful attention and reflection. The growth we are experiencing now is largely consumer and demand-led. While this has generated broad-based growth reaching across all sectors of the productive economy, the response has been somewhat uneven across these sectors. In particular, while the performance of the tertiary sector and within that of the financial services sector, has surged, manufacturing, although growing, has been a relative laggard. This is linked to a further feature of our current growth trajectory. The consumer boom is drawing in imports, not just of machinery and equipment, but now also of consumer goods.

We no longer face the kind of balance of payments current account constraint that dogged every effort of the apartheid regime to sustain growth above 3% because we are now experiencing a net positive inflow of foreign portfolio investment. While this is a welcome sign of international confidence in the South African economy, it is also something we need to be cautious about because we know that short-term foreign investment is notoriously volatile.

Arising from this diagnosis, our key challenges can be identified as the following: There is a need to raise the growth rate to yet higher levels; we have to make the higher growth trajectory more sustainable by addressing real economy constraints, and we need to make the growth path more employment - creating and pro-poor, in a context where much of our unemployment problem can be recognised as structural in nature.

I want to argue that, contrary to what the DA appears to think, we cannot have the first growth without simultaneously addressing the other two challenges. This is so for the simple reason that many of our key constraints to growth arise from real economy and developmental deficiencies. The micro-economic reform programme formulated some years ago pointed out how our economic infrastructure upgrading, including ports and transport systems, was key to improving the performance of the South African economy. What we also know now is that addressing this will not happen without significant public investment. Likewise, skills shortages are a major constraint requiring a major effort to raise the skills of millions of black people whom apartheid sought to confine to the sphere of cheap unskilled labour. In a similar vein, the domestic market needs to expand by unleashing possibilities for large numbers of our people to engage in sustainable livelihoods. Again, none of these will happen without a public programme.

I need to report a high degree of consensus in the portfolio committee hearings that an expansionary fiscal stance and a responsible loosening of the deficit target is appropriate to these challenges, and that the real increases in expenditure provided for in this Budget are widely welcomed. Particularly pleasing are the increases announced for infrastructure investment - much of which is off-budget – for skills training, for land reform, for micro-credit and for an extension of the social security net.

The majority of members of the committee were also supportive of the shift away from the provision of costly tax incentives - which have yielded relatively little by way of additional investment – in favour of improving the overall climate for investment in this country. Particularly welcome here is the new tax dispensation for small business, including raising the tax threshold and the new simplified procedures for VAT payments. But I want to emphasise again that for many trapped in what the President has called the “second economy”, expenditure programmes are just as, and indeed even more, important.

I want to give just one example: SMMEs with a turnover of R35 000 or less will not pay tax and will now be able to file for VAT three times a year instead of every two months. This is great news for small and medium businesses and for some in the category “very small” who have been paying taxes, but it won’t be much to many more very small micro enterprises that have always been and will remain outside the tax net, whether legally or not. For them more important than a tax break would be gaining access to the R100 million budgeted for the Apex Fund this year or the R600 million to R1 billion budgeted for the agricultural micro-credit scheme across the MTEF period.

The infrastructure development programmes for state-owned enterprises mentioned in the Budget, which are mostly funded off- budget, are also critical in overcoming bottlenecks in the real economy as well as stimulating job creation.

The report of the portfolio committee contains 16 specific recommendations. They cover a number of issues. I do not have time to go into them now, but I hope the executive will respond to them more fully in due course. I would like, though, to mention just one, which, I believe, is pertinent to our work in Parliament as we move from the First Reading of the Budget to the individual Budget Vote debates. Recommendation 10 says, and I quote:

The Committee notes that the Budget puts in place necessary conditions for improvement in the quality of social service delivery by Government, but whether such improvements are realised depends on the quality of implementation.

The Committee recognises that Parliament has a key role to play in exercising oversight of implementation, and therefore urges all portfolio committees to develop systematic approaches to reviewing the strategic plans, budgets, quarterly performance reports and annual reports.

What this recommendation is saying is that it is not just up to the executive but also a responsibility for us in Parliament to ensure that implementation takes place. The onus of this responsibility will particularly fall on us on this side of the House together with a few other more constructive parties. We know, for example, that if a portfolio committee uncovers that a particular Seta is not functioning well, those on this side of the House will call for its abolition in order to release funds to finance further tax cuts for the rich. It will be up to the rest of us to find a real solution.

In the short time I have available I want to address another topic. While the Budget is critical to the economic performance of this and other countries, so too is the global economic environment. The year 2005 is the year when the UN General Assembly will review progress in advancing towards the Millennium Development Goals, MDGs – the main one of which is to halve the number of people living in extreme poverty by the year 2015. A considerable body of research has established that while these goals are indeed achievable, on the present course the number of poor people in Africa is set to increase rather than decrease from 315 million to 404 million by 2015, while the achievements of the MDGs will be delayed by at least a century.

In this context we are seeing a global movement calling for the world to “make poverty history” and for a new “big push” to achieve the MDGs. Minister Manuel has been part of a very important initiative - the Commission for Africa. This, among other things, called for a complete debt cancellation in a context where the debt of sub-Saharan Africa, minus South Africa, stands at $186,7 billion, compared to a gross geographic product of $217 billion, and where debt repayments continue to exceed aid flows. It also called for steps to ensure that developing countries can expand exports; and that additional resource transfers to Africa amounting to at least $25 billion take place.

Again, we as parliamentarians need to find ways to become part of the global movement pressing for such demands. I am pleased to see that tomorrow we will be having a debate on the International Parliamentary Union’s deliberations in this regard.

I would also like to indicate that the African Caribbean Pacific-European Union Joint Parliamentary Assembly, at which I have the honour to represent this Parliament, will also be adopting a declaration on the Millennium Development Goals at its next meeting in Mali next month.

May I end with a commercial: Tomorrow at lunchtime, Minister Manuel will be holding a briefing on the work of the Commission for Africa, and I think it’s important that we all attend! We have been invited to do so.

The ANC will support the First Reading of the Appropriation Bill. I thank you. [Applause.]

Mr I O DAVIDSON: Madam Speaker, hon Minister of Finance, this may well be the kiss of death for the Minister, but the DA will be supporting the Budget. [Interjections.] We support this Budget because it is both redistributive and expansionary while keeping within the prudent deficit level of 3% of GDP.

We now have a stable macroeconomic environment from which to address the problem of growth and the creation of jobs. This is where the DA approach differs fundamentally from the ANC’s. While the DA believes in an economy in which every citizen is ensured the opportunity to fulfil his or her potential, the ANC believes in something called the developmental state.

To answer the interjection Minister Manuel made when we supported the Division of Revenue Bill, namely that the DA had bought into this concept of a developmental state, well, the Business Day of 8 March provides an apt definition of such a state. It describes such a state as a sort of mixed economy hybrid, anywhere between “leading Western industrial” state and “banana republic”, in which the state takes upon itself the right and obligation to intervene in the economy to fix anything it feels isn’t working properly - a sort of nanny state in which great emphasis is placed on telling business what to do and where to do it, instead of making it as easy as possible for South Africans to start businesses, invest and employ by removing the constraints to business.

The DA rejects this model. We believe that government should focus in the main on its role as a facilitator of productive economic activity, which will create jobs. Not only do we need economic growth but also, more importantly, we need growth that will drastically reduce job-seeking queues.

Now it is not my intention to get into a sterile debate with the Minister about the length of those queues. Whether the unemployment rate is 30% or 40%, whether the strict definition or expanded definition should be used, does not detract from the central fact that there are now more South Africans without work than there have been in the past eight years. We need sustained growth of 6% or more, yet Minister Manuel’s own projections for our developmental economy for the next three years average only 4,1%.

I asked the Minister in the portfolio committee why it was that in a survey published in The Economist of GDP growth amongst the 25 monitored emerging markets, South Africa was consistently either at the bottom or close to the bottom of the list.

He said that he thought we lacked a spirit of entrepreneurship. Well, I agree, and thus welcome the Minister’s tax break for small businesses. These developments, together with the undertakings given by the President in his address to Parliament on 11 February, must surely remove some of the constraints felt by entrepreneurs in small business.

While the Minister seems to have fulfilled the President’s undertaking in respect of taxes and levies, we await with interest developments in respect of “central bargaining and other labour arrangements” which the President intimated would follow. Herein lies the acknowledgement that government, up to now, has always dismissed – that our labour laws are an impediment to growth. Perhaps the Minister of Labour should consult more closely with the Presidency before he tub-thumps at Cosatu gatherings.

Small business development and labour market deregulation are necessary, but not sufficient conditions for large-scale job creation. This Budget should have provided direct incentives for business, both big and small, as well as households, to employ labour.

We currently grant incentives for capital investments through an assortment of capital allowances. But what of companies and, for that matter, households that employ labour-intensive methods and those industries in which there is less fixed-capital investment required, such as tourism and service industries? Why don’t we grant them tax allowances that are calculated not only on the amount invested, but the number of new jobs? This is the type of bold thinking that is needed.

Another impediment to growth is our rate of investment. Along with a chronically low rate of foreign direct investment, South Africa continues to have a savings rate, or domestic investment rate, amongst the lowest in the world. Singapore’s rate is 45% of GDP, while ours declined to 4,7% in the third quarter of 2004.

The much-maligned private sector cannot be blamed for this, as their savings increased to 12% of GDP, while over the same period government’s contribution was a mere 0,2% rising to a projected 1,1% in 2007. This underlines the fact that the private sector is the primary vehicle for investment and sustainable growth.

While we welcome the 1% cut in the corporate tax rate, we maintain that the rate needs to drop further to encourage greater investment. Our effective tax rate remains high at around 37%, taking into account the secondary tax on companies.

In a survey last year KPMG showed that the average effective tax rate for emerging markets was only 24%. Countries with which we compete directly for capital investment, namely Malaysia, Mexico and Indonesia, have effective tax rates of 28%, 33% and 30% respectively.

We believe that the usefulness of the secondary tax cut has to be reassessed. In addition, instead of ad hoc adjustments to the corporate tax rate, government should commit itself to a corporate tax rate of, say, 25% and a time period over which it would be implemented. This will have a powerful and immediate effect on investment.

Our government’s dramatic failure to confront the HIV/Aids pandemic head-on is more painfully obvious in this Budget. Only 54% of those targeted to be on antiretroviral drugs by 2005 are currently receiving them, while the Budget does not specify resources allocated to the antiretroviral roll - out this year. In the original Budget operational plan, the total budget estimate for the programme was R2,4 billion in 2005, yet this Budget only allocates 64% of that amount.

One of the most pressing impediments and constraints to growth identified by the IMF in 2003 was South Africa’s low skills level. Instead of addressing this issue in a bold and imaginative way, the Budget only throws more money at the Setas. These institutions fell far short of spending their R1 billion last year, yet are now being given R4 billion in the Budget before us. They are both inefficient and ineffective. And, I think, we have to fundamentally change the way we tackle the skills shortage.

Firstly, in the short term, our immigration policy needs a bold approach, not the inadequate and investor-unfriendly approach of the new regulations. Secondly, from a fiscal perspective, we believe that R4 billion could far more cost-effectively be spent incentivising learners through opportunity and bursary vouchers, and business through full rebates to employers and employer associations who undertake training in their specific sectors.

Directly related to skills is capacity. While government has budgeted R92 billion this year on infrastructure spending and a further R230 billion over the next two years, the Financial and Fiscal Commission noted in its report to the Finance committee that capital spend across all levels of government is still significantly lower than existing budgetary resources. Provinces, for example, spent only 46,4%, on average, of their capital budgets last year, and there is nothing to indicate that this will change. The skills and capacity problems, I think, will be exacerbated by the planned infrastructure roll-out by state-owned enterprises of somewhere close to R118 billion over the next few years.

This expenditure, along with increased welfare spend, which as a percentage of GDP has increased by 70% in the past five years, raises the question of fiscal sustainability. Three figures are particularly concerning in this regard.

Firstly, the current account deficit is currently at 3% of GDP, but is forecast to rise to 3,5% of GDP over the next three years. While this deficit is currently being offset by short-term capital inflows, such flows are notoriously fickle and a sudden outflow could compromise the balance of payments, to the detriment of hard-won inflation stability. Secondly, the alarming downturn in the current balance shows that government is, once again, borrowing to finance current expenditure. This trend is precisely what the difficult period of fiscal consolidation after 1994 was designed to reverse, and its resurgence raises concerns around the sustainability of increased current expenditure, especially that related to increased social grants.

Thirdly, the public sector borrowing requirement, at 3,9% of GDP, although lower than the alarming 4,6% of GDP forecast in the Medium-Term Budget Policy Statement, presents the possibility of persistent higher debt levels, the burden of which would fall on ordinary taxpayers who would have to foot the bill, and on the bond market which would have to absorb the loans, possibly to the detriment of monetary policy flexibility. Contributing significantly to the relatively high borrowing requirement is the fact that no privatisation proceeds are budgeted for this year.

The DA believes that the privatisation programme should be revitalised, not for ideological reasons, but for reasons of efficiency, service delivery, debt reduction and extension of share ownership.

The private sector should be leveraged as far as possible in the rolling out of new infrastructure. This will lower the cost to the state and will allow a turnaround in a trend of rising government expenditure, which has grown from 25,7% of GDP two years ago to 27,3% this year. A reduction in state expenditure will provide space for a looser monetary policy and, together with the infrastructure investments, engineer a real boost for economic growth and job creation at a lower cost than the high long-term borrowing and high tax burden approach.

Such bold reforms will be a clear break from the gradual extension of government involvement in almost every facet of our economic life. They will create an opportunity for individuals and businesses to build infrastructure, create jobs and drive growth.

Now, I agree with the Minister - we can and shall build a South Africa that truly belongs to all who live in it, united in our diversity. But instead of offering a nanny state to achieve this, we should recognise that every individual, whether a CEO, a middle manager, a street sweeper or someone in a job queue, has a unique talent to offer our country. Our responsibility is to offer that person the opportunity to realise his or her full capability. Thank you. [Applause.]

Mr T E VEZI: Thank you, Madam Speaker. The Minister is commended for the consistent and balanced way in which budget policy has been conducted over the last decade or so. Good progress has been made with economic policy goals of higher stable economic growth, the balance of payments equilibrium and income distribution.

The concern is that employment creation remains at an unacceptable level. There is a mismatch between the skills of job seekers and the demand for skills in the economy. So while economic growth is needed to create jobs, the skills needed to create growth are not available. Our country faces a severe skills shortage, but has a surplus of unskilled and semiskilled labour. Therefore, government encourages labour-intensive investments.

The challenge to raise the level of economic growth needs to be accompanied by the challenge to increase labour absorption. The rate of growth in employment has not been sufficient to keep pace with the expansion of the labour force. The step-up to a projected average growth rate of 4,2% over the MTEF is certainly likely to be positive for employment growth, but unlikely on its own to produce a solution to the continuing problem of unemployment.

The government realises that employment–creating growth is a multifaceted phenomenon and that it should be tackled over a wide front in the short, as well as the longer-term in a balanced way. The IFP fully agrees with this approach. In the final analysis the longer-term option of empowering people through education and training is probably the only sustainable way to tackle the unemployment problem in our country.

The IFP applauds this year’s Budget, which provides for a real increase in expenditure on education of 2,5% this year, and 5,3% and 3,6% respectively in the next two years. This provision is higher than in the MTEF because of an additional R1 billion for the recapitalisation for further education and training colleges, R776 million for the National Student Financial Aid Scheme and R6, 9 billion to improve salaries for teachers. Another concern is the low savings rate in our country - particularly by households - the rapid increase in household consumption expenditure and the related increase in debt.

The IFP welcomes the Budget for a season of hope. At the same time we are very much aware of the serious implementation challenges. We agree with the Treasury that in order to sustain higher growth we need to increase infrastructure investment, lower the cost of doing business in South Africa, especially for small business, produce more skilled people and improve the quality of public service, especially to the poor.

The IFP welcomes the expansionary stance from 2001; the stable tax burden around 24,1% of GDP in 2004-05, to 3,2% in 2007-08; the deficit of 3,1% in 2005-06, declining to 2,7% by 2007-08. Debt service costs decline from 3,5% of GDP in 2004-05, to 3,2% in 2007-08 and the significant surpluses in social security funds. The IFP supports the additional R43, 5 billion to be received by provinces over the MTEF for provincial priorities, which are comprehensive HIV/Aids prevention and treatment plans, providing for security expansion, nonpersonnel inputs into education, post - settlement support for farmers, infrastructure investment, with a special focus on labour-intensive projects, and hospital revitalisation programmes.

Tax reform that is conductive or geared to advancing or fostering freedom of choice is to be supported. There is a noticeable pattern of such reform in South Africa, which appears to have taken place continuously. Its considerable influence on increasing service, investment, employment, productivity and state revenue collection, whilst also helping keep prices and interest rates down, is very welcome.

There is no quick - fix solution for South Africa’s economic problems. Some of the few young African artisans are now beginning to look abroad as placement, after acquiring skills in this country, becomes very difficult. These young people should be given start-up capital to start their own businesses.

We support the Commission for Africa report, which calls on the industrial nations to abolish trade-distorting subsidies to their farmers, which give them an unfair advantage over poor African farmers, as well as the lowering of tariffs and other nontariff barriers to African products. And the developed countries should not demand reciprocal concessions from the poor African nations.

We are concerned that, according to the report, it is now common cause that Africa is the only region in the world that will not, as a whole, meet the Millennium Development Goals or even come close on present trends. We support the increase in social security. Even the World Bank concluded in a major 1986 study of World Hunger that a rapid increase in food production does not necessarily result in food security, that is less hunger.

Current hunger can only be alleviated by redistributing purchasing power and resources towards those who are undernourished, the study showed. In a nutshell, if the poor don’t have the money to buy food, increased production is not going to help them without a strategy for change that addresses the powerlessness of the poor. The tragic result will be more food and yet more hunger, and we will be faced with the situation where we can say: Water, water, water everywhere, nor any drop to drink.

Mr Minister, we do not live in ivory towers, so we very much appreciate the problems that you are faced with in trying to divide the Budget. In saying that, we don’t have a quick solution for this country. I might as well just say that one of the most successful farmers in my area, 40 years ago, invited me to accompany his daughter who was a teacher at the primary school. I went there and listened . . .[Time expired.]

Mr S E ASIYA: Thank you, hon Deputy Speaker. It is an honour and a privilege for me to participate in this important debate. We are discussing this Budget in the favourable conditions of macroeconomic and inflation stability. This factor has created investment opportunities nationally, regionally and globally.

My contention is that South Africans are fast becoming responsible tax- paying citizens. Compliance promotes patriotism, which is core to the advancement of the Reconstruction and Development Programme. There is recognition of the fact that this is not only the responsibility of the state, but rather of all of us who are committed to making South Africa a winning nation.

The SA Revenue Service has come to the party by putting systems in place, resulting in the estimated revenue increasing by R11 billion, which is more than the original prediction. This is a significant contribution given the fact that the estimated Budget tabled in February included huge tax cuts. This has won the confidence of ordinary taxpayers, who are appreciative of the fact that their obligation to the state can only help to advance their own cause and that of developing the economy.

In fact, Madam Deputy Speaker, over the 10 years of freedom the ANC-led government has given individual tax rebates to the tune of R77 billion, ensuring that people have more money to spend, and perhaps to save. The Budget process is a commitment and a constitutional requirement to effect equitable distribution of national revenue among the three spheres of government. Distribution is not mechanical or determined by bureaucratic means.

The Budget is guided by government policies and is designed to use its resources to address the socio-economic needs of all our people. It is guided by the priorities identified by the hon President in his state of the nation address.

Taxation is a social contract between a government and its citizens on how money is collected from them and redistributed in order to secure a stable environment.

The manner in which this government has conducted the Budget process has resulted in the overwhelming majority of citizens declaring that the Budget and fiscal policies are sound. They have welcomed the forward-looking approach of revenue collection and the user-friendly style of Sars, which resulted in defaulters coming forward to honour their obligations. We trust that Sars will continue to be creative and innovative in order to attract more defaulters and to extend its net to secure the commitment of those who still need to be touched. Bearing in mind that the socio-economic commitment of the state can only be met if enough revenue is collected, we therefore compliment Sars on its dedication and on its professional approach to revenue collection. The business community, the middle stratum, the workers and social welfare beneficiaries have generally welcomed the redistribution principle adopted by the government. In this regard I wish to quote the Chamber of Commerce and Industry of South Africa, for instance, as follows:

   The announced tax changes are poised to support economic growth and
   employment in a manner strengthening the economy. The tax measures to
   bolster small and medium enterprises are welcome.

Business Unity SA, or Busa, indicated that the Budget appears to be fiscally responsible and disciplined to reduce the public and private sector interest rate burden, thereby creating space for useful spending.

The federation of unions of South Africa fully agreed with the government’s approach to lower the company tax from 30% to 29%. They further added that the increase in government capital expenditure underpins economic growth and social expenditure to provide a safety net for vulnerable groups in the economy.

Business confidence is high and employment is growing. Unemployment is declining steadily and the black middle stratum is growing rapidly.

Business partnerships are being forged between people from the previously disadvantaged communities, the historically advantaged, the private sector and the public sector. We accept that in some instances the BEE process is experiencing challenges. However, this does not mean that the principle governing BEE is wrong.

Critics from the opposition point to some of the loopholes evident during the implementation phase to reject the principle of black advancement. These neoconservatives must be ignored. We must continue to be vigilant and ensure that correct systems, through trial and error, are in place in order to secure a culture of best practices.

Instruments such as social welfare grants and the dedicated Public Works programmes are improving the lives of the poorest of the poor.

Somlomo, uHlahlo lwAbiwo-Mali esixoxa ngalo namhlanje lwamkelekile kubantu bonke balapha emhlab’uhlangene, nakwiZizwe eziManyeneyo.

Olu Hlahlo lwAbiwo-Mali lusemkhondweni woMqulu weNkululeko kwaye lujongene nokuphuhlisa amahlwempu. Lukwavule namathuba koosomashishini abakhasayo kunye nabasaqingqayo ukuze babe nakho ukuthabatha inxaxheba kushishino oluvulelekileyo.

Abantu okanye imibutho eya kuthi ichasane nale nkqubo iya kuba ingoobholelecaleni.

Sekela-Somlomo, isininzi sabasebenzi abasebenza emaphandleni, kwizixeko nasezidolophini nabamkela imivuzo ephantsi bakhetha ukuyeka umsebenzi baye kwamkela indodla okanye inkamnkam kuba bafumana imali edlula le bayibilelayo. Loo nto yenza umthwalo ubenzima kurhulumente. Ngoko ndihlaba ikhwelo kuthi sonke apha, ngakumbi aba bakweli cala lam, lokuba bavuze abaqeshi babo ngokufanelekileyo. (Translation of Xhosa paragraphs follows.)

[Madam Deputy Speaker, this Budget Vote has been welcomed by everybody here as well as in the United Nations.

This Budget Vote is in line with the declarations enshrined in the Freedom Charter and it seeks to improve the lives of poor people. It has also opened up opportunities for entrepreneurs and small business people which would enable them to participate meaningfully in the open economy.

The people and parties who are opposed to this Budget Vote can only be mavericks.

Madam Deputy Speaker, the majority of people working in the rural areas, cities and towns and those who receive low wages choose to leave their jobs so that they can receive pensions or disability grants because the amount of money they receive is greater than that for which they sweat. This creates a huge burden on the government. I therefore call on all of us present here today, especially the ones on the other side, to pay their employees an acceptable living wage.]

Perhaps the DA should focus on convincing its so-called traditional support to pay decent wages to workers across the board, from both the urban and rural areas, rather than producing a nonsensical budget.

In fact, a significant number of DA supporters have complimented the government on its forward-looking economic and fiscal policy. In short, the government has honoured its obligation to improve the lives of all its citizens in a stable and nonracial democratic state . . .[Interjections.] . . . Keep quiet and listen.

In honouring its social contract new challenges manifest themselves. The ANC-led government is the first to declare that while we have made significant gains in the past 10 years, much more still needs to be done.

The DA’s alternative approach pins its hope for economic growth and alleviation of poverty and inequality on tax reduction. However, it is silent on the urgency of poverty reduction.

Economic growth involves a time factor and it has essential consequences, which factor the DA ignores. It is as if economic growth is a fait accompli.

By implication, the document hints that the ANC-led government lacks the political will necessary to pursue economic growth. This inference is shocking beyond imagination.

In conclusion, let it be boldly stated that the South African economy is on a path to more stable growth during this MTEF period. However, the growth path that South Africa’s economy is now entering cannot be attributed to global economic development alone, but also to the domestic economic policies.

As a result of consistency over the past 10 years, the economic environment for fiscal policy has changed rapidly. The fiscal policy has focused more on equitable income distribution through the redistribution of expenditure and addressing the needs of the poor.

The ANC-led government is honouring its social contract as enshrined in the Freedom charter.

Enkosi, ndiyabulela. [Kwaqhwatywa.] [I thank you. [Applause.]]

Mr M STEPHENS: Madam Deputy Speaker, hon Minister and hon members, it seems that the hon Minister of Finance has presented this House with two budgets. The one is a well-crafted speech, eloquently delivered by a competent Minister and then packaged and sold by those among the ranks of his spin- doctors. One might call it the PR budget. The other budget speaks much less eloquently but much more urgently. It speaks from the real, hard figures that are tabled with the PR budget. One might call this the silent but real budget. I shall confine myself to dealing with the latter.

The PR budget talks of increases in social grants and pensions, but the real figures show that the increases that filter through to the elderly and the disabled barely keep up with inflation. They receive no real increase. They languish in poverty while awaiting the pleasure of the Minister.

The PR budget has been widely hailed as being pro-poor, but the silent reality is that the poor remain in abject poverty, and the Budget announcements about inflation-linked increases in social grants and pensions will not change that fact. When I confronted the hon Minister about this in the committee, his response was that social grants and pensions couldn’t exceed minimum wage levels for fear of discouraging people to look for employment. This argument, with respect, is a big, fat red herring.

The UDM has never suggested that social grants should replace income or that poverty can or should be alleviated through social grants. That would be ludicrous. But, pensions and disability grants should be adequate to allow a person to live with dignity above the poverty line, or does the hon Minister wish to force the elderly back to work, seeking jobs in competition with the young? Should the disabled start up their own businesses or join the queues of able-bodied work seekers who themselves cannot find jobs?

The elderly and the disabled should not be forced to seek employment. Pensions and social grants are provided on the grounds of means testing, and these people cannot be consigned to abject poverty forever on the grounds that they should rather be searching for employment. Disability grants and pensions are not about replacing employment temporarily. They are about alleviating poverty. It is disingenuous to fail to make that distinction.

The PR budget is hailed for putting money into taxpayers’ pockets. The silent budget confirms this, but it reveals the bitter truth that while those who are employed and earn enough to pay income taxes are given a real after-inflation increase, those millions who are in real need, those who have nothing, get nothing - so much for government’s commitment to eradicating poverty.

The silent budget also reveals that, despite tax cuts, the individual taxpayer still carries the tax can. Personal income tax is still the greatest single source of state revenue. It virtually doubled during the nine years to 2004. Individuals’ income tax amounts to 32,56% of total state revenue from all sources and when VAT paid by individuals is included, this percentage will be much greater. Against this, companies pay only 20,13% of total revenue, also excluding VAT.

When I faced the Minister with these facts in the committee – he will recall this – and argued the necessity to shift the tax burden, the hon Minister claimed that the volatility of revenue streams from company income tax was too great for him to rely on increasingly. I therefore tested the Minister’s hypothesis using figures he published in reply to my questions, for which I thank him.

One expects the volatility of tax revenue streams to be slightly higher than that of the estimates that call them forth. Thus it is no surprise that personal income tax shows volatility of 5,51% against the 5,48% volatility of the estimates. Similarly, VAT shows volatility of only 2,04% against the 2,68% volatility of the total estimates.

Company tax shows volatility of 16,63%, which is overshadowed by the incredible 21,61% volatility of the estimates. This indicates a serious flaw in the budgeting process. It probably also indicates that the volatility problem originates more in the Minister’s department than in the revenue streams of companies. It is a matter that requires immediate attention, especially since it appears to be the one factor inhibiting a shift of the tax burden away from households and onto firms. The poor will not see an improvement in their lives as a result of this Budget. The poor are beyond income tax relief, but they do pay taxes such as VAT; they are affected by other taxes, such as fuel levies, when they travel. So, the second economy is burdened with tax, but receives no relief, no reprieve and so the gap widens.

This Budget is a sound First World budget. Any finance Minister of any G7 nation could be justly proud of it. But First World solutions will not save our second economy, nor will it be saved by improvements in the first economy. It will only develop by the growth of state enterprises and new strategic industries, enterprises not primarily driven by profit, but by beneficiation, service and employment. We want to see a budget that gives the founding of new strategic industries the highest priority.

Now is the time to think out of the box. We will not achieve what we have to achieve for the people of South Africa by sticking to the budget mantras of the First World. [Time expired.]

Mr L W GREYLING: Madam Speaker, the Budget that is presented annually can be seen as a visible expression of the government’s priorities. Various political pronouncements that are made concerning the government’s plans are nothing more than rhetoric if budgetary allocations are not made to realise them.

When drawing up this Budget, there are obviously competing concerns, and it would be impossible to please all sectors of society. The ID believes however, that this Budget, despite some concerns, represents a good balancing act between the demands of the different sectors. We are happy to see that the government has continued its trend of increasing expenditure and carving out a greater role for itself in fostering development in South Africa.

The ID has continually argued that a strong developmental state is needed to bridge the huge divide still present in our society. In fact, the ID believes that the state could and should be doing more, and that even greater expenditure should be directed at our key social sectors such as health, education and social development. Through its astute financial management of the economy over the last 10 years, the government has made available extra resources, which should now be spent on truly improving the social base of our society.

The ID wishes to commend the SA Revenue Service for the extra revenue it keeps collecting year after year. The ID maintains, however, that the true beneficiaries of this increased revenue stream must always be the poor. The most direct way in which to allocate these funds is through the grant system. It is therefore unacceptable to the ID that in the context of increasing revenue streams, the increases in grant allocations have hardly even kept pace with inflation. The ID understands the government’s concern that payments for grants are growing, but in a country that suffers from structural unemployment, and is characterised by extremely high levels of poverty, grants are often the only safety net available to poor households. We should be comforted by the knowledge that more people living below the poverty line are receiving some form of government assistance.

The ID does not believe the government’s argument that grants create dependency. Poverty creates dependency. Poor people without hope of a job are often dependent on their neighbours for money or a sole breadwinner in the household to keep the family afloat. We need to recognise that grants are playing a huge role in poverty alleviation and, where possible, bolster them to play it more effectively.

In this regard, the ID would urge the government to start making plans for rolling out the child support grant to children in the age group 15 to 18 years, as per the definition of children contained in the Constitution. While this might seem expensive to the government, it in fact represents only half of the money that was given away in tax cuts this year.

In terms of tax cuts, the ID does support certain tax relief for companies as contained in this year’s Budget. There are, however, no guarantees that local direct investment and jobs will necessarily follow corporate tax cuts. The government should therefore develop a framework similar to the one that operates in Malaysia where there is direct reward from the fiscus for positive performance in this regard.

In terms of education, the ID strongly welcomes the extra R6,9 billion that has been set aside to increase the salaries of educators. This is a sector that is grossly undervalued, and it is reflected in falling numbers of young people enrolling to become teachers. Unless drastic action is taken to make this an attractive profession, we will be faced with a crisis of teacher supply in this country.

In his state of the nation address last year, the President firmly stated that by the end of the financial year no child would be taught under trees or in dangerous structures. It is clear that we have not reached this target, and the ID is concerned that the needed resources have not been made available to ensure this target is reached by the end of next year.

Current estimates place the resources needed to achieve this goal at between R12 billion and R20 billion. The ID would argue that such money should be made available through a conditional grant to provinces to ensure that this target is finally met.

The ID also has first-hand experience of witnessing the crisis affecting service delivery to children. A great number of these services, including statutory services, are being provided by NGOs and CBOs. Despite this reality, there does not seem to be any more money allocated through the equitable share to provinces to allocate to NGOs. It seems that we are relying on volunteers and people’s altruism to deliver much-needed services. Services such as home-based care and child support should be run through NGOs and CBOs, and adequate provision must be made for people’s salaries. The ID believes that until the state adequately supports those that support children we will never be able to put the rights of children first.

In general, the ID supports the Budget, though, and we plead with government departments to spend their allocations in an effective manner so that we can truly bridge the divides in our society and create a prosperous nation for us all. I thank you.

Ms S H NTOMBELA: Deputy Speaker, hon Ministers and hon members, this year we will be observing the 50th anniversary of the adoption of the Freedom Charter. As we celebrate this 50th year of the existence of the people’s document, which forms the basis of the struggle and our vision of the ANC, we should use this year to reflect on what we have done to ensure that the visions of the Freedom Charter are realised.

Modulasetulo, mokgwa wa ka ke motho ya atisang ho hopotsa batho bao ekang ba se ba lebetse hore hana rona re bomang ebile re tswa kae. Afrika ke naha ya baholo ba rona. Ba ne ba phela ha monate ba na le dikgomo, dinku, dipere, jwalo-jwalo. Ba ne ba na le naha e ntle e mobu o nonneng, ba lema ba ja hamonate le bana ba bona. Ba ne ba nyolosa ba theosa, ba tsamaya ka bolokolohi naheng ya bona. Ba ne ba phela ha monate le ka kgotso naheng ya bona, Afrika.

Athe, kae-kae, ho na le batho ba ntseng ba shebile ba kenweng ke mona. Ba rera ho ya qhala botle boo bo Afrika. Tjhee, o tshabe mona le pelo e telele. Ka 1652, a fihla ngwana wa Lenyesemane, Jan van Rieebeck, le bao a neng a tsamaya le bona. Ao, ya tloha taba! Ba nka lefatshe la baholo ba rona ka bonokwane, ba ba tshepisa mahodimo le lefatshe. Ba bang ba shwa ba ntse ba tseka naha.

Ya ya naha banna, ya ya mehlape le moruo wa baholo ba rona, ya ya Afrika batho batsho ba phela jwalo ka makgoba naheng ya bona.

SETHO SE HLOMPHEHANG: Ba jwetse!

Mof S H NTOMBELA: Ka selemo sa 1913, taba ena ya ho ikgapela naha ba e kenya molaong o neng o bitswa Natives’ Land Act [Molao wa Taolo ya Naha] ka puo ena ya bona ya sejatlhapi. Wona he, ke ona molao wa pele o sehloho wa kgethollo ya mmala, o neng o bolela hore ba basweu ba nke karolo e kgolo ya lefatshe, e etsang 87%. Ke ka hoo o bonang motho ka mong wa bona a na le dipolasi tse pedi ho isa bohlanong. Ba bang ba na le dipolasi diprofensing tsena kaofela. O fihlele hore motho o na le polasi Mpumalanga, Freistata le Gauteng. Ha e le batho batsho bona ba fuwa makumane a lefatshe, a etsang 13%, fatsheng la bona, fatsheng la Afrika. Ke moo he noha e kgolo, kganyapa ANC, e ileng ya hlaha, ya kopanya baruti, marena le batho bohle ho lwanela naha ya bona. ANC ya tla ka leano la yona le reng mayibuye iAfrika, izwelookhokho bethu [ha e kgutle Afrika, fatshe la baholo ba rona]. Ba e lwana empa ya ba hlola. Ho tjhetjha ha monna, banna, ha se ho baleha, empa e le ho nka matla.

Ba fetisa molao o mong hape o bitswang the Group Areas Act, 1950 [Molao wa Kgethollo ya Mmala, 1950]. Jo! Batho batsho ba qhalwa jwalo ka mabele, ba kenngwa lehloyo la semorabe pakeng tsa bona. Basotho ba iswa Qwaqwa, maZulu a iswa KwaZulu, jwalo-jwalo. Le a tseba he lona hore ntwa ena ya semorabe e re baketse eng. Ebile ha ke batle le ho bua ka yona haholo hobane re tla tloha re thonkga maqeba a seng a fodile.

Ka 1955, baholo ba roba ba ANC ba kopana Kliptown ho rala Tokomane ya Tokoloho, Freedom Charter, ba beha taba ya naha ka sehloohong moralong wa bona. Empa ba ile ba elellwa hape le hore ba basweu e se e le karolo ya Afrika Borwa. Ba dumellana, le ha ho le jwalo, hore empa ha e le lefatshe lona, le tla tlameha ho arolelanwa mahareng a ba sebetsang ho lona. (Translation of Sesotho paragraphs follows.)

[Chairperson, I usually like to remind those who seem to have forgotten, who we are and where we come from. Africa is our native country. Our forefathers used to live happily here; and they had cows, sheep, horses and so on. They had a beautiful fertile land, and they planted their crops and happily ate them with their children. They went up and down, walking freely in their own land. They lived happily and peacefully in their land, Africa.

It turned out that somewhere there were people who were keeping an eye on them and feeling jealous. They planned to destroy all that beauty in Africa. There is nothing like jealousy and greed. In 1652, Jan van Riebeeck, a white man’s child, arrived with his entourage. Things really started to happen! They cunningly took our forefathers’ land from them and promised them heaven and earth. Some of them died fighting for the land.

Off went our land, off went the cattle and riches of our forefathers, off went Africa, and black people were left living like slaves in their own land.

An HON MEMBER: Tell them!

Ms S H NTOMBELA: In 1913, taking over people’s land was legalised and called the Natives’ Land Act, in their English language. This was the first cruel segregation law, which stated that whites should access the biggest part of the land - up to 87%. That is why you find them having two to five farms each. Some of them have farms in all of the provinces. You will find one of them with a farm in Mpumalanga, in the Free State and in Gauteng, while black people are only given crumbs of about 13%, in their own land, Africa. That is where the big dinosaur, the ANC, came in and brought ministers, kings and everyone together to fight for their land. The ANC came up with a programme that stated that Africa, the land of our ancestors, should come back to its owners. They fought but they lost the battle. Taking a few steps back does not mean that one is giving up, it only means that one is drawing more strength.

They passed another law, the Group Areas Act of 1950. Alas! The black nation was scattered and ripped apart. Tribal hatred was injected into their midst. The Basotho were sent to Qwaqwa, the amaZulu were sent to KwaZulu, and so on. You know what this tribal feud has cost us. I don’t even want to talk much about it because I could end up opening some old wounds.

In 1955, our ANC elders met at Kliptown to draw up the Freedom Charter, and concentrated on issues of land in their draft. However, they also realised that the white people were now also part of South Africa. They agreed that the land should be shared among those who work it.]

The land shall be shared amongst those who work it.

Ba re Afrika Borwa ke ya batho bohle, ba basweu le ba batsho.

Ya fihla 1994. Ba hodimo ba eba ka tlaase mme ba tlaase ba eba kahodimo. ANC ya nka puso. Jwale e tlameha ho lokisa taba ena ya naha. Re tshwanela ho etsa bonnete ba hore naha e se be naha ya batho ba itseng feela.

Melao e netefatsang sena, e ile ya ba ena: Molao wa Karolelano ya Lefatshe, e leng Land Redistribution Act. Mona ANC e fetola sebopeho se sebe sa mobu, se bontshang thuo ya mobu e le ya ba basweu feela. Ka naha re kgona ho fedisa tlala, ho hlokeha ha mesebetsi le bofuma, ka ha re tla lema, re rue dikgomo, jwalo-jwalo; mme bohle re tla fumana bophelo bo botle.

Mathata a ntse a le teng ho potlakisa molao ona hore batho ba fumane naha. Ha re tla tabeng ya moithaopi ya rekang le moithaopi ya rekisang, borapolasi ba nyolla theko ya mapolasi a bona habohloko, ho sitisa borapolasi ba bannyane ho reka. O tla utlwa ba ntse ba re mmuso wa rona o a re thusa, ke ka hoo ba nyollang theko ya mapolasi a bona. Mohlala wa sena o mane Mpumalanga, Limpopo, Kapa Bophirimela le mane karolong tsa Freistata tse bitswang Clarence le Roadside. Empa hoo ho keke ha etsa hore ANC e fetole ntlha-kemo ya rona ya moithaopi ya rekang le moithaopi ya rekisang. Empa re tlameha ho tla ka leano ho fetola maemo ana a borapolasi ba nkang monyetla ka ho rekisa lefatshe ka tjhelete e ngata, ho thibela borapolasi ba bannyane ho fumana naha.

Leano ke lena: Letona le fuwe matla a ho nka lefatshe ho borapolasi bana ba sataladitseng melala ya bona. Letona le tlameha ho sebedisa matla ao hoba re tshwanela ho netefatsa toro ya baholo ba rona e reng lefatshe le tla arolelwa batho bohle ba sebetsang ho lona. Re tshwanela ho etsa hore Afrika Borwa e be ya rona bohle.

Ha re bua ka Land Restitution, re bua ka kgutlisetso ya naha ho ba e nketsweng ka bonokwane. Mona ANC e kgutlisa naha ela e nkilweng ka sehloho ka 1913. Mona he le lona le dipaki. Re bone ka moo baholo ba rona ba neng ba itshela ka dikgapa ha Letona le kgutlisa lefatshe la bona. Mohlala ke dibaka tse kang Maokeng, Freistata, Kapa Botjhabela le mane District Six.

Re ile ra itumela haholo ho utlwa Letona la Ditjhelete le bile le etsa bonnete ba hore le kenya tjhelete e lekanang le R6 billion ho netefatsa hore re tswela pele ka taba ya ho kgutlisa lefatshe le ho potlakisa taba ena. E, e fela jwale naha e tla arolelanwa mahareng a bohle ba phelang ho yona.

Ha re bua ka Land Tenure Reform, re bua ka molao oo sepheo sa wona e leng ho sireletsa ditokelo tsa batho ba mapolasing ba tlatlaptjwang ke borapolasi. Le ha ho le jwalo, borapolasi ha ba kgathalle molao ona. Ba ntse ba tebela batho ba borona ka sehloho letsatsi le letsatsi. Batho ba borona ba ntse ba behwa ka thoko ho tsela, ho sa kgathaletsehe hore pula e a na, metsi a teng, matlwana a teng kapa ba dutse polasing nako e kae. Ke bona bana borapolasi ba ipitsang hore bona ke baKreste.

Ha borapolasi ba ne ba na le tjhebelopele, re ka be re sena dipale tse tshwanang le ena: Mane Freistata, polasing ya Heilbron e bitswang Driefontein, ho na le ntate ya neng a bitswa Springkaan Piet Makume, ya dutseng moo dilemo tse ka bang 63. O hlahetse moo, a holela moo, a nyalla moo a ba a fumanela bana ba hae moo. Bophelo bohle ba hae o bo dutse moo, a sebetsa ka thata, a sebetsa ka botshepehi, a sebeletsa rapolasi. O ne a na le dikgomo tse hlano, ka ha a ne a dumeletswe ho rua tse hlano feela.

Ha etsahala hore selemong se fetileng a hlokahale, a siye bana ba hae ba tsheletseng le mofumahadi. E mong wa bara ba hae o qhwadile, ka ha a ile a hatwa ke trekere ya hae rapolasi eo. Le pele ntate Springkaan a ka patwa, rapolasi a ba bitsa mme a ba bolella hore ka mora lefu ba tsamaye polasing. A ba bolella hore ba ye lekweisheneng, ho Mbeki, o tla ba fa tulo.

Ba ne ba sena le tjhelete e lekaneng ya ho pata mofu. Ba kopa yena rapolasi hore a mpe a ba thuse, empa a ba bolella hore o ne a lefa Sprinkaan R260 le mokotla wa phofo, ka kgwedi. Ba kopela feela mmabona sebaka sa hore ba tle ba mo patele pela ntata bona. A ba bolella hore eo polasi ke ya hae, e seng ya ANC.

Mofumahadi wa Makume o ne a bua mantswe a bohloko a le mong, a hore ha a utlwisise hore hobaneng ngwana eno a tshwanetse ho mo etsa jwalo. Ke yena ya mo hodisitseng, o ne a mo ntsha maleiri, o ne a mo isetsa dikhafothini sekolong mme a bile a bapala le yena. O ne a mo etsetsa le ntho tseo a neng a sa di etsetse bana ba hae. A re yena Sprinkaan yenwa ke yena ya neng a lema polasi ya ntata bona, ke yena ya neng a hlokometse mehlape ya bontata bona. A re le lebitso lena la Springkaan o le reilwe ke ntata rapolasi eo.

A re o utlwa bohloko ka ho fetisisa ha ba ntse ba bua hampe ka moetapele enwa wa rona, ntate Mbeki. A re hobaneng ba etsa tjena? Hobaneng ba tshwanetse hore ba re etse tjena empa rona re sa ka ra ba tebela, re re Afrika Borwa ke ya batho bohle ba phelang ho yona, ba basweu le ba batsho? Ke bua le wena tjena, lelapa la ha ntate Makume le ntse le dutse moo Driefontein, pela tsela. Le dutse moo le sena motlakase, le sena metsi, ebile ba iswa ka pela lekgotla la dinyewe ka labone, ho ya nkelwa tsohle tseo e leng tsa bona.

Ba bangata batho ba rona ba tshwanang le Sprinkaan, bao borapolasi ba ba fetotseng ntho tsa ho bapala. Hona ke bopaki ba hore molao ona wa rona wa Katoloso ya Botsitso ba Thuo ya Lefatshe, o bitswang Extension of Security of Tenure Act, o na le masobanyana a fang borapolasi matla a ho tlatlapa batho ba habo rona. Re tla tlameha ho kwala masobana ao. Re tla tlameha ho ema ka maoto ho ruta batho ba habo rona ditokelo tsa bona. [Mahofi.]

Empa batho beso ba dipolasing ke rata mantswe a bona ao ba a buwang. E mong wa bona o re: le ha ba ka re tlatlapa, ba re etsa dintho tsohle, ba re isa hodimo le fatshe, ba kgesa ANC, empa ha e le morao teng ha re sa ile. Batho bao ba habo rona le bona ba na le ditokelo karolong ya mobu. (Translation of Sesotho paragraphs follows.)

[They said that South Africa belongs to all – blacks and whites.

Along came 1994. Those who were at the top went down to the bottom and those at the bottom went to the top. The ANC took up governance, and now they have to deal with this land issue. We must make sure that the country does not belong to certain people only.

One of the laws that were put in place to ascertain this was the land redistribution Act. With this Act, the ANC is changing the picture that suggests that the land is only for white people. With land, we can defeat starvation, job scarcity and poverty, because we can plant, have cows and so on; and we can all have a good life.

We still have some problems regarding the speeding up of this law to ensure that people get land. With regard to the willing buyers and sellers of land, farmers put exorbitant prices on their farms to make it hard for small farmers to buy them. They claim that we get help from our government, and that is why they raise their prices. Examples of such situations can be found in Mpumalanga, Limpopo, the Western Cape and parts of the Free State called Clarence and Roadside.

However, that will not push the ANC to change its standpoint on the willing buyers and sellers of land, but we have to come up with a plan to deal with these farmers who take advantage of the situation and sell the land at such exorbitant prices, which prevents small farmers from getting land.

Here is a plan: The Minister should be given the power to take the land from these farmers who are rigidly preventing small farmers from buying the land, and the Minister should use these powers because we have to make our forefathers’ dream, that the land should be shared among all those who work it, a reality. We have to make sure that South Africa belongs to all of us.

When we talk about Land Restitution, we are talking about taking the land back to those whose land was dishonestly taken from them. Here, the ANC is taking back land that was cruelly seized in 1913. You can bear witness to this matter; we all saw how our elders cried when the Minister returned their land to them. Examples of such places are Kroonstad in the Free State, and District Six in the Western Cape.

We were very happy to hear the Minister of Finance saying that he is going to make an amount of R6 billion available to make sure that we proceed with this matter of reclaiming the land and that this process is speedily taken care of. Yes, now the land will truly be shared among those who live in it. When we talk about land tenure reform, we are talking about a law that is set on protecting the rights of farm dwellers who are abused by farmers. However, this law still does not bother farmers. They still cruelly kick our people off the farms, every day. Our people are still dumped on the roadside, regardless of whether it is raining, whether there is any water available there, whether they have sanitation or how long they have lived on the farm. These are the farmers who call themselves Christians.

If the farmers had some foresight, we would not be talking about situations such as these: In the Free State, on a farm called Driefontein in Heilbron, there was a man called Springkaan Piet Makume who lived on that farm for about 63 years. He was born there, grew up there, got married there and even had his children there. He lived there his whole life, working hard and faithfully for the farmer. He had five cows, because he was only allowed to have five cows on the farm.

Last year, he died and left his wife and six children. One of his sons is disabled because he was run over by the farmer’s tractor. Even before Springkaan was buried, the farmer called his family and told them that they should leave the farm after the funeral. He told them that they should go to the township, to Mbeki, who would give them a place to stay.

They did not even have enough money to bury their deceased, and when they asked the farmer to help them out, he told them that he used to pay Springkaan R260 and a bag of maize-meal each month. They asked him to give them some space next to their father’s grave so that they could bury their mother next to her husband when she died. He told them that the farm belonged to him, not to the ANC.

Makume’s wife used to painfully ask herself why that child should do that to her. She brought him up, she used to change his diapers, and she used to bring his lunch box to school for him and even used to play with him. She used to do things for him that she did not even do for her own children. She said Springkaan used to plant their father’s fields, and he used to look after their father’s cattle. She said this farmer’s father was the one who gave him the name “Springkaan” [Grasshopper].

She said it hurts her a lot when they talk so badly about our leader, Mr Mbeki. Why should they do that to us? Why should they do that to us when we did not chase them out of the country; when we said South Africa belongs to all who live in it, black and white? As I am speaking to you, Mr Makume’s family still lives on the side of the road in Driefontein. They live there without electricity, without water, and they will be taken to court on Thursday and stripped of all their belongings.

There are a lot of our people who are in a similar situation to that of Springkaan’s family; people whom the farmers have turned into their toys. This shows that this Extension of Security of Tenure Act has some loopholes that enable farmers to continue abusing our people. We will have to close those loopholes. We will have to stand firm and teach our people their own rights. [Applause.]

However, I like the words spoken by our people on the farms. One of them said that even if they abuse us, do all sorts of things to us, take us up and down and belittle the ANC, we are never going back. Those people also have rights with regard to land issues.]

The land must be shared amongst those who work it, so that South Africa can truly belong to all of us.

Taba ya naha ke ntho ya bohlokwa haholo. Ha setjhaba sa Israele se tswa Egepeta, se ile sa bontshwa kamoo naha e leng ntho ya bohlokwa ka teng. Ba ile ba tshepiswa naha e nang le lebese le dinotshi. Ka hoo, taba ya naha e sale e qala le Bebeleng.

Nalane ya rona jwalo ka batho lefatsheng lohle, e bontsha hore ntwa tsohle tse bileng teng lefatsheng ka bophara, e bile tsa ho lwanela lefatshe. Haufinyane le rona mona, Mozambique, Frelimo e lwantshana le Portuguese, mme taba e ne e le lefatshe. Angola le MPLA ba lwanetse lefatshe le moruo wa naha. (Translation of Sesotho paragraphs follows.) [The issue of land is very important. When the Israelites went out of Egypt, they realised how important land was. They were promised the land of milk and honey. Therefore, the issue of land started as long ago as the biblical era.

Our history, as people the world over, shows that all the battles that we have fought were based on land. In Mozambique, just next to us, Frelimo was fighting with the Portuguese, and the main issue was land. Angola and the MPLA also fought for the economy of the land.]

In Nigeria, with regard to one of the greatest struggles in the history of mankind . . .

. . . e ne e le ntwa ya ho lwanela lefatshe. Esitana le hona mona Zimbabwe, hantle-ntle ntwa ke ya ho lwanela lefatshe. [Kena hanong.]

Ha se phoso ha ANC e re: mayibuye iAfrika [Afrika ha e kgutle], hobane re baetapele ba makgonthe fatsheng la borona. Re batla ho etsetsa bana ba rona bokamoso bo tjhatsi. Ke kahoo re ipiletsang ho baholo ba rona ba kgutlisetswang naha hore ba seke ba nka tjhelete haholo, ba nke lefatshe hobane mmuso o batla ho etsa bonnete ba hore Afrika Borwa e be ya rona feela. Ke ka hoo ntate Trevor a ntshitseng R6 billion. Ke ka hoo re tshwanelang ho kgothatsa batjha ba rona ho ithutela tsa temo, ho tseba tsohle ka naha, hobane naha ke wona mokokotlo wa ho fedisa bofuma mme batjha bona ke mokokotlo wa bokamoso ba setjhaba sa rona. Nka lebala jwang mafumahadi? Mme o teng mane Freistata, ya bitswang Clementina Mokoena, ya ileng a fumana kgau e bitswang female farmer of the year [mmapolasi wa selemo], ka ho lema konofolo. Dingaka di ile tsa mo eletsa hore, ka ha a na le lefu la kgatello e phahameng ya madi, a je konofolo, mme o ile a qala ho itemela konofolo.

Empa qetellong, konofolo eo e ile ya rekwa ke batho bohle mme a ba a qetella a entse polasinyana ka yona. Kajeno tjena o a e rekisa mme o kgona ho fepa bana le ho isa bana dikolong. Bomme, ke eo he. Le utlwile hore tjhelete e ngata jwang ya bajete. Le oreng le sa tjhabile mona ho ANC.

Empa ho na le borapolasi bao re tlamehang ho ba thoholetsa. Ke a ipotsa hore na ebe ka mona ka ho DA ho na le ba seng ba kile ba arolela batho ba rona dipolasi na. Ho na le bao re tshwanetseng hore re ba thoholetse, ba itahletseng ka setotswana ho etsa bonnete ba hore ba fa batho karolo e itseng ya naha, ba batlang ho bona hore Afrika Borwa ena e fela e le ya rona bohle. Re tlameha ho ba leboha ka ketso eo ya bona.

Maoba mona ke kopane le balemi ba bannyane ba mane Matatiele, bontate Malefane le ba bang, ba re ba utlwile ka puo ya Mopresidente ha a ne a bua hore ba tshwanela ho tla fumana dithuso, mme ba thabisitswe le ho feta ke ha ba utlwa Letona la Ditjhelete bajeteng ya lona le bolela hore ho na le tjhelete e lekanang le R1 billion e tlo ba thusang ka dipolasi hore ba kgone ho sebedisa dintho tse batlehang dipolasing. Ba re ba leboha Mopresidente mme ke ba lebohele, ba leboha comrade Trevor, ba leboha le ANC haholo-holo. Ba tshepisa hore le ha batho bana bao le ba tsebang lona, ba ka kgesa, ba ka nyenyefatsa, ba ka bua dipuo tsa batho le tsa manyeloi, empa bona le bana ba bona ba tla voutela ANC ho fihlela ba rwala mobu ka sefuba. [Mahofi.]

Ba re ka morao ho puo ya Letona la Ditjhelete, kamora bajete ena, ba bona hore e fela e le nnete hore toro e tla phethahala e reng . . . (Translation of Sesotho paragraphs follows.)

[. . . they were fighting over land. Even in Zimbabwe, their fight is mainly over land. [Interjections.]

There is nothing wrong with the ANC saying, “Mayibuye iAfrica” [Let Africa come back], because we are true leaders in our country. We want to give our children a bright future. That is why we appeal to our elders whose land is returned to them not to only consider money; they should take land because the government wants to make sure that South Africa belongs to them. That is why Mr Trevor Manuel made R6 million available to them. That is why we have to encourage our youth to learn about agriculture, to learn everything about the land, because the land is the foundation in the fight against poverty and the youth is the foundation of the future of our country.

How can I forget the ladies? There is a lady in the Free State, called Clementina Mokoena, who won the Female Farmer of the Year Award by planting garlic. Doctors advised her to eat garlic because she has high blood pressure, and she started planting garlic for herself.

However, everybody bought the garlic, and she finally started a little farm with that garlic. These days, she sells that garlic, and now she is able to feed her children and send them to school. Ladies, there you are. You heard how much money is being budgeted for, so make hay while the sun is still shining on the ANC.

However, there are some farmers whom we have to applaud. I wonder whether there are any DA members who have shared their farms with our people. There are some people whom we have to applaud, who have joined forces and given some people a part of their land, and who want to make sure that this South Africa really belongs to all of us. We have to thank them for what they have done.

The other day, I met some small farmers from Matatiele; Mr Malefane and others. They said they heard the President’s speech when he said that they were going to get help, and they were even more excited by the Minister of Finance in his Budget Speech, when he said that there was R1 billion budgeted to help them get the necessary equipment, to help them with their farm work. They said they would like to thank the President and I should convey their gratitude to him, and they would also like to thank comrade Trevor and the ANC, in particular. They promise that, even if those people you know should scorn, belittle and say all sorts of things, they and their children will vote for the ANC, till they die. [Applause.]

They said that after the Minister of Finance’s speech and after this Budget, they think the dream will really come true - . . .]

. . . the land must be shared amongst those who work it.

He, batho ba heso, kgomo ha e nye boloko kaofela. [Mahofi.] [People, one can never tell it all. [Applause.]]

Mnr F BEUKMAN: Agb Adjunkspeaker, agb lede, agb Minister van Finansies, ek gaan nie na makrokwessies verwys soos ander kollegas reeds gedoen het nie, maar eerder fokus op opleiding en kapasiteitsbou in die lig van die Begroting.

Een van die belangrikste doelwitte in die staatsrede van President Thabo Mbeki is die volgende: om sy doelwitte te kan bereik moet die regering ’n enorme verbetering in sy bestuurs-, organisatoriese-, tegniese- en ander vermoëns bewerkstellig. Dit het direkte implikasies vir die uitvoering van die Begrotingswetsontwerp en die toekennings aan staatsdepartemente.

Die Minister van Finansies gee inhoud aan die beginsel in sy Begrotingsraamwerk. Daarom kan die toekennings aan departemente en die verdeling aan programme nie los staan van ’n verskerpte poging om die bemanning van finansiële bestuur in die openbare sektor op die vlak van direkteurs-generaal, bo-finansiële beamptes, finansiële bestuurders en interne ouditpersoneel te versterk en verder met kapasiteit toe te rus nie.

Ook hierdie hoofdoelwitte blyk uit die toekennings aan Begrotingsposte 12, 8 en 10, en dis ook veral waarna ons wil verwys. Dis hier waar die vulling van die vakante poste in die finansiële bestuurskader van die Staatsdiens en die trek van nuwe talent krities noodsaaklik is.

Die toekennings van die owerheidsektor kan ook nie los staan van twee belangrike doelwitte wat in die staatsrede van 11 Februarie gestel is nie, naamlik die verslag van die direkteur-generaal om teen Mei ’n verslag aan die Kabinet voor te lê vir die verbetering van die regering se dienslewering en uitvoering van programme ten einde dit effektief te laat uitvoer, en dit kan nie geskied sonder die nodige finansiële bestuurspersoneel nie. Daarom moet opleiding, indiensopleiding en leerprogramme aan die finansieskant van departemente die fokus bly.

Terwyl die jaarverslag van die Ouditeur-Generaal aan die een kant bepaalde gevaartekens oor opleiding aantoon, blyk dit dat die hoofde van die Tesourie, Samdi en DPSA bepaalde inisiatiewe geloods het om die kapasiteitsprobleme aan te spreek. Dit word ook in die nuwe Begroting weerspieël en moet verwelkom word. Wat kapasiteitsbou betref, moet die kapasiteitsbou - inisiatief van die Nasionale Tesourie, waar 71 kursusse geakkrediteer is en waarby diensverskaffers betrokke is, verwelkom word. Ook die aanduiding van die Tesourie, verlede Vrydag, dat 243 senior finansiële personeel kursusse met betrekking tot die Wet op Openbare Finansiële Bestuur deurloop het, is goeie nuus.

Die bedrag van R28 199 999 met betrekking tot finansiële bestuurstelsels in die wetsontwerp moet hierby ook genoem word. Ook die diensverskaffingsprogram van Ipfa met betrekking tot kursusse is belangrik, veral die program van die Rekenmeester-Generaal waar 20 interne vir indiensopleiding betrek word, is ’n voorbeeld van ’n proaktiewe benadering by finansiële bestuur. Dit sal goed wees as ander departemente ook poog om die Tesourie se voorbeeld in dié verband te volg.

Sonder goedgekwalifiseerde finansiële personeel kan kwaliteitkontrole en bestuur nie geskied nie. In dié verband is die nuwe inisiatiewe van Samdi, Begrotingspos 12, as’t ware in ’n nuwe gedaante van deurslaggewende belang. Dit is daarom belangrik dat departemente en die staat nie net gebruik maak van ander instellings nie, maar ook Samdi gebruik, aangesien ander kontrakteurdienste dikwels nie toepaslike opleiding verskaf nie en ook ten duurste is. Die herposisionering van Samdi moet verwelkom word, veral hulle nuwe model wat kapasiteitsbou betref. (Translation of Afrikaans paragraphs follows.)

[Mr F BEUKMAN: Hon Deputy Speaker, hon members, hon Minister of Finance, I am not going to refer to the macro issues that other colleagues have referred to already, but in the light of the Budget I am rather going to focus on training and capacity - building.

One of the most important objectives outlined in the state of the nation address by President Thabo Mbeki is the following: To meet its objectives the government needs to massively improve its management, organisational, technical and other capacities. This has direct implications for the implementation of the Appropriation Bill and the allocations to state departments.

The Minister of Finance gives content to this principle in his Budget Framework. Therefore the allocations to departments and the distribution to programmes cannot be separated from an intensified effort to strengthen and further capacitate the staff complement of financial management in the public sector at the level of directors-general, financial officials in the upper echelons, financial managers and internal auditing personnel.

These main objectives are also evident from the allocations to Budget Votes 12, 8 and 10, and this is what we also want to refer to in particular. This is where filling vacant posts in the financial management sector of the Public Service and attracting new talent are essential.

The allocations of the government sector can also not be separated from two important objectives which were outlined in the state of the nation address of 11 February, namely the report from the director-general to submit a report to Cabinet by May for the improvement of the government’s service delivery and implementation of programmes in order to execute it effectively, and this cannot happen without the necessary financial management personnel. Training, in-service training and learnerships should therefore remain the focus on the financial side of departments.

Whereas the annual report of the Auditor-General indicates specific warning signs about training on the one hand, it is clear that the heads of the Treasury, Samdi and DPSA launched specific initiatives to address the capacity problems. This is also reflected in the new Budget and should be welcomed. As far as capacity-building is concerned, the capacity-building initiative of the National Treasury, accrediting 71 courses and engaging service providers, should be welcomed. And the indication from the Treasury, last Friday, that 243 senior financial personnel attended courses regarding the Public Finance Management Act is also good news.

The amount of R28 199 999 concerning financial management systems in the Bill should also be mentioned here. With regard to courses, the service delivery programme of Ipfa is also important, and the programme of the Auditor-General in particular, which involves 20 interns for in-service training, is an example of a proactive approach to financial management. It will also be good for other departments to attempt to follow the example of the Treasury in this regard.

Quality control and management cannot happen without well-qualified financial personnel. In this regard the new initiatives of Samdi, Budget Vote 12, in fact have taken on a new form of crucial importance. Therefore it is important for departments and the state not to use other institutions only, but also to use Samdi, in view of the fact that other contracting services often do not provide appropriate training and also cost too much.

The repositioning of Samdi should be welcomed, particularly their new capacity-building model.]

We welcome Samdi’s commitment to extend the senior level agreement that Treasury has with Ipfa to roll out short courses on a large scale. The courses will be packaged into structural programmes for the various levels, and be linked to Ipfa qualifications.

It’s also to be welcomed that Samdi aims to link qualifications with Saqwa and Fasset. Samdi stated that a commitment to work very closely with National Treasury on the roll-out of financial administration and management training is the correct approach.

Daar kan in politieke, teoretiese en finansiële terme oor die Begrotingswetsontwerp gedebatteer word, maar ’n voorvereiste is dat behoorlik toegeruste en opgeleide finansiële personeel beskikbaar is om hierdie program te dryf. Om dit slegs aan die mark oor te laat is nie genoeg nie, en daarom is die ingryping van die Tesourie, DPSA en Samdi nodig en tydig.

Die fokus in die Begrotingswetsontwerp op hulpbronne vir finansiële administrasie en bestuursopleiding in die MTEF-termyn is ’n aanduiding dat dié aspek die aandag kry wat dit verdien. Die Begrotingswetsonwerp is die regte platform om bestuursdienste en finansiële spesialis - kennis in die openbare sektor op ’n beter grondslag te plaas ten einde inhoud aan die lewerings- en diensleweringsdoelwitte van die staat te gee. Dankie, Adjunkspeaker. (Translation of Afrikaans paragraphs follows.)

[The Appropriation Bill could be debated in political, theoretical and financial terms, but a prerequisite is that well-equipped and trained financial personnel should be available to drive this programme. It is not sufficient to leave it to the market only, and for that reason the intervention of the Treasury, DPSA and Samdi is necessary and timeous.

The focus in the Appropriation Bill on resources for financial administration and management training in the MTEF period is an indication that this aspect is receiving the attention it deserves. The Appropriation Bill is the appropriate platform to elevate management services and financial specialist knowledge in the public sector in order to provide content to the delivery and service delivery objectives of the state. Thank you, Deputy Speaker.]

Mr K D S DURR: Madam Deputy Speaker, the Budget is sound and builds upon the gains of the past years that were based essentially upon the moderate growth in the economy exceeding the growth in expenditure. They are a story of high achievement, and we congratulate the Minister and his department for staying the course. These things have long lead times, and they stayed the course.

The poet Robert Browning once said that it is important that “a man’s reach should exceed his grasp”. Quite so. Keeping the Budget below 25% of GDP is desirable. The central question, however, remains, posed also by my colleagues here: How can we accelerate growth wisely on a sustainable basis so as to include ever- increasing numbers of South Africans in gainful and self-respecting employment? Kantor says: “Workfare is better than welfare”.

What would we in the ACDP do? A précis: We would dramatically incentivise savers, private and corporate; we would remove every barrier to economic growth possible at all tiers of government; we would accelerate some imaginative skills transfer and education programmes, also using private sector educators as accelerators; we would modernise the tax system by testing the introduction of a comprehensive low-rate transaction tax; we would end exchange control; we would introduce an incentive scheme to repatriate South Africans from abroad, including free travel home and a tax holiday for the first year when they come home - and each one coming home, we calculated, Minister, would produce six to ten jobs if they returned home and became employed.

We would emphasise reconciliation, and de-emphasise the demotivating race debate in South Africa and would focus on policies of reconciliation, of nation-building and of assisting the poor and the disadvantaged; we would follow policies of inclusion for all citizens at all levels and in every field of endeavour; we would have a more sectoral approach to managing the economy, and not let whole sectors languish, like textiles and agriculture, without timely, appropriate action.

We would start identifying and building upon those things that unite South Africans, rather than harping continuously and unproductively on things that have divided us in the past, real or imagined. In short, we would try to build the confidence of the nation. How can we get that extra growth we need from the economy without sufficient savings, personal and corporate, to sustain that growth? In Asia growth rates are high, but so are savings rates. South Africans are investing abroad, with some R3,8 billion net outflow of capital in the first nine months of 2004. The government is still dissaving and personal savings are amongst the lowest in the world. We need to address this imaginatively. I respect that you say programmes have been launched by the government on retirement savings, and so on. I believe we could have dealt with tax relief on annuities now.

I believe we could have cut the corporate tax by another percentage point - 2% - rather like Singapore did a couple of weeks ago from 22% to 20%. Another thing we need to handle very carefully, Minister, if we do not wish to damage confidence - and I really do not want to politicise what I am going to say to you now - is the whole question of foreign ownership of property in South Africa.

We need to understand that in a globalising world we are in competition with other parts of the world to attract tourists, long - stay tourists and visitors that choose to retire here or to repeatedly revisit us by buying property; people like Oprah Winfrey. It is an act of confidence on the part of these people.

When they buy, we do not lose the property, but we have their investment as well, and we have their ongoing service expenditure in maintaining their investment, whether they like it or not. They keep coming back instead of visiting other places, because they have a reason to come. They make other investments here. They do charitable work, like Oprah did, for example. This is the purest form of investment, and there is great competition from around the world for this category of investor from Spain, Portugal, Switzerland, the USA and the Caribbean, to name only a few.

In inner London, in Chelsea, Kensington, Mayfair and St John’s Wood, the foreign ownership of London buildings is estimated at over 30%. In Cape Town it is under 1%. This is a highly profitable international market that we should be tapping into and we should do nothing to disturb it by regulation, prohibition or precipitated action. We have something people want; we need to nurture the possibility and not strangle it at birth because of ignorance or xenophobia.

I want to close also, Minister, with some thoughts on the opposition. I am often reminded that the opposition should not slavishly oppose in Parliament for the sake of it. We in the ACDP promise not to do so, but on condition that the government members do not slavishly support the policies of the governing executive, no matter what. We have a duty in Parliament. We must execute it. We will support the Budget. I thank you. [Time expired.] [Applause.]

Mr G D SCHNEEMANN: Deputy Speaker, Comrade Minister, comrades and hon Members, the Budget which we are discussing today is one that gives the people of our country the assurance and hope that this ANC government is committed to improving the quality of life of all South Africans.

It is a budget that will continue to stimulate growth in the economy. It also provides our people with the opportunity to acquire and develop new skills that will assist them to access employment opportunities. It gives meaning and life to the words of the Freedom Charter, which was adopted at the Congress of the People at Kliptown on 26 June 1955, fifty years ago.

The ANC’s January 8 statement in 2002 stated the following:

. . . we must base our vision, programmes and actions on that historic manifesto of the people of South Africa, the Freedom Charter. This demands especially of our vanguard movement that we ensure that the Freedom Charter plays its central role in the formation of the new South Africa as a living document.

The ANC’s January 8 statement this year included the following:

The Charter embodies a vision of an alternative society to the society we inherited. It constitutes the programme of the people of our country for the creation of a truly democratic, nonracial, nonsexist, united and prosperous country.

During our third democratic elections in April 2004,the masses of our people reconfirmed their confidence in our movement as the best defender of the vision spelt out in the Freedom Charter, a true custodian of their aspirations and a trustworthy leader of all our people as they continue to act together to meet the difficult challenge of eradicating the legacy of colonialism and apartheid and building a winning nation.

However, there are some in our country and in this House who refer to the Freedom Charter as an irrelevant and outdated document. They say that the aspirations of the majority of the people of this country are irrelevant. They also say that they have no concern nor do they care whether the people shall share in the country’s wealth, or whether the land shall be shared among those who work it, or whether there shall be houses, security and comfort. The Budget tabled in this House on 23 February delivers on all the clauses of the Freedom Charter.

The Budget allocation of R6 billion to complete the land restitution programme will ensure that the land will be shared among those who work it. The increased allocation of R2 billion for the new housing strategy and the R3 billion set aside over the next three years for investment in the community infrastructure, together with the R1,7 billion for municipal and sanitation infrastructure, will ensure that there shall be houses, security and comfort.

These allocations will ensure that we can build a united and prosperous society and also provide hope to those who are in need of adequate shelter that the government is committed to building a nation whose people are adequately housed with access to services such as sanitation, water and electricity.

I would like to draw attention to a new housing development in the Lanseria area in Johannesburg, called Cosmo City. The sale of these bank-financed homes is attracting South Africans from all walks of life. This development, which forms part of the new housing strategy, will also accommodate beneficiaries of subsidised housing together with those who choose to access social or rental housing.

The development of Cosmo City and the other provincial pilot projects provides us with the opportunity to build new, vibrant suburbs, which reflect a united, nonracial, nonsexist and prosperous society. This will give effective meaning to the vision of a South Africa that belongs to all who live in it.

Yesterday the Minister of Housing, comrade Lindiwe Sisulu, announced that the housing subsidy is to be increased from the current R28 279 to R31 900. This is a clear indication of government’s commitment to providing quality shelter to those who need it most. During the election campaign last year, the ANC said in its manifesto, amongst other things, that the land restitution programme would be completed and that more subsidised housing would be built. Both of these commitments, together with the others which were included in the ANC’s 2004 election manifesto, are included in this Budget.

This displays the commitment of the ANC government to the creation of a better life for all. Included in the terms of reference of the Joint Budget Committee is the monitoring of actual revenue and expenditure per department on a monthly basis. The Budget provides increased allocations for capacity-building and training. This relates to the need for increased capacity and training within the Public Service, which was alluded to by President Mbeki in the state of the nation address on 11 February this year.

Whilst the Budget provides the necessary resources to implement the programmes of government, the successful implementation of the various departmental programmes is dependent on the capacity of the Public Service.

It is important that departments use these allocations in a manner that will culminate in a well-capacitated and equipped Public Service that can ensure the efficient and cost-effective implementation of government’s programmes and policies. The practice of Batho Pele must become part of the everyday work ethic of those who work in the Public Service.

The Division of Revenue Bill makes specific reference to the submission of expenditure and performance reports to the National Treasury. Equally important is the quality of spending and whether or not we are getting the best possible value for money spent.

Emphasis must also be placed on monitoring and evaluating the expenditure patterns of departments in relation to their strategic plans as well as the outcomes achieved.

The Joint Budget Committee will play an important role in monitoring not only expenditure patterns but also the quality of the final product that is delivered. The success of the building of new, sustainable human settlements will depend on the ability of government departments to work in a co-ordinated manner and to align their budgets so that vibrant new human settlements are created with all the necessary infrastructure provided simultaneously with the delivery of shelter.

This will require greater interdepartmental co-ordination and forward planning. The Budget allocates R3 billion for transport infrastructure and investments as well as allocations towards the 2010 World Cup-related infrastructure projects. It is important to ensure that the infrastructure which is provided for the 2010 World Cup will benefit our nation for generations to come.

The Budget allocations will accelerate service delivery programmes with particular emphasis on the delivery of water and sanitation targeted towards those who need it most. The effective implementation of the programmes which are provided for in this Budget will ensure that we become not only a winning nation but also a country that we can be proud of, and one that will sustain our future generations.

In the coming years we look forward to reaping the benefits of the efficient utilisation and implementation of the resources provided by this Budget and the proposed allocations over the MTEF.

There is therefore no reason why we cannot see more Monde Zondekis emerging on our sports fields, or more South African films like Yesterday being nominated for Oscars.

Together, as a united nation we have the potential. The Budget provides us with the tools to take the potential we have and produce the results that will make us a winning and successful nation.

In addition to the monitoring of actual revenue and expenditure per department, the Joint Budget Committee is also tasked with considering whether allocations in the Appropriation Bill are broadly in keeping with the policy directions of government.

We in the ANC, having read and interrogated the Budget documentation provided, are confident that the 2005 Budget allocations, as well as the budget over the MTEF, are in keeping with the policy directions of government.

The Budget focuses on growing the economy, creating more employment opportunities, reducing poverty and inequality, lowering the levels of crime, accelerating the provision of basic services and infrastructure, and providing quality housing, as well as improving the quality of education and health services.

As we start our journey into the second decade of freedom, the 2005 Budget lays the foundation for us to reach our destination and it contributes to creating a season and decade of hope.

We in the ANC support the First Reading of the Appropriation Bill. I thank you.

Dr C P MULDER: Madam Deputy Speaker, the ANC chose the Freedom Charter as a theme for this year. They are all familiar with the slogan which states, “South Africa belongs to all who live in it, black and white”. But is that really true or is it mere rhetoric and ANC propaganda? Mr Manuel, my fight is not with you. I believe all South Africans will agree with me when I say that you are a very good Minister of Finance. My fight today is with the ANC, it being the current government of South Africa.

Section 6 of the Constitution makes provision for 11 official languages. Why? South Africa is a very diverse society. It is a society of cultural, linguistic, ethnic, racial and other divisions. One would have hoped that the government would recognise this reality, but sadly that is not the case. In the future historians will look back at current developments in South Africa today and write the following: “During the early part of the 21st century South Africa was faced with a new phenomenon; the phenomenon of ANC colonialism and imperialism. During this period the ANC pursued an aggressive policy of”

Mr S D MONTSITSI: Madam Deputy Speaker, on a point of order: I want to ask if it is parliamentary for Zimbabwean parliamentarians to speak in a South African parliament? [Laughter.]

The DEPUTY SPEAKER: I do not think that is a point of order because we do not have any Zimbabwean parliamentarians. Hon member, please proceed.

Dr C P MULDER: “During this period the ANC pursued an aggressive policy of expansionism, extending its ideological, political, philosophical and cultural influence throughout South Africa. Like all other imperialists before them, they did this with total disregard for all that was dear and of importance to each and every other community with which they came into contact.”

Imperialism manifests itself in one people, usually representing a particular community that tends to dominate all others by creating a unified system of control. That is exactly what the ANC does on each and every level of society.

Die totale inkomste van die staat vir hierdie boekjaar is ongeveer R369 miljard. Die direkte persoonlike inkomstebelasting is ongeveer R116 miljard. Dit sluit nie indirekte belastings soos BTW in nie. ’n Aansienlike deel daarvan word deur Afrikaners betaal - dit staan vas - maar Afrikaners moet weet: julle het geen sê oor hoe een enkele sent daarvan bestee word nie. Julle betaal julle deel van die belasting, en genoeg daarvan, maar andere sal besluit wat hulle daarmee wil doen.

Op Vrydag 18 Februarie open premier Rasool die Wes-Kaapse provinsiale parlement. Hy gee hoog op oor die ANC se strewe om die Wes-Kaap ’n tuiste vir al sy inwoners te maak; ’n provinsie waarin net mooi 60% van die inwoners Afrikaanssprekend is.

Op dieselfde dag word die uitspraak in die Laerskool Mikro-saak in die Kaapse Hooggeregshof gelewer. En onthou, Mikro is nie ’n wit skool nie, want daar is kinders van alle gemeenskappe. Dit gaan oor Afrikaans. Die regter bevind dat die Wes-Kaapse onderwysdepartement buite sy bevoegdhede opgetree het, en gelas hulle ook om alle regskoste te betaal. Die hof bevind dat die ANC verkeerd opgetree het.

Ek het dadelik ’n brief aan premier Rasool geskryf en hom gevra om baie mooi te besin: “Moenie oorhaastig reageer en besluit om te appelleer nie. As jy en die ANC ernstig is om werklik ’n tuiste van die Wes-Kaap en ook vir sy 60% Afrikaanssprekende inwoners te maak, dink net wat se sein stuur die ANC vir hulle as julle hulle die reg om enkelmedium-Afrikaanse skole te hê ontsê.”

Ons ken mos die patroon: eers een klas, dan later ’n dubbelmediumskool en nog later ’n enkelmediumskool, naamlik Engels. Maar nee, ons is terug by ANC-imperialisme. Die voor-toyi-toyiende plaaslike minister van onderwys, Cameron Dugmore, lei die aanslag, natuurlik met my en ander Afrikaanssprekendes se belastinggeld. Alle Afrikaanssprekendes moet baie mooi weet die ANC is nié hulle vriend nie. Inteendeel.

Ek het ongeveer drie jaar gelede, toe die NNP die DA verlaat het om by die ANC in die bed te spring, die NNP gewaarsku. Ek het van hierdie podium af gesê: “Die ANC is nie regtig mal oor julle nie. Hulle doel is om die NNP te vernietig”, en ek was natuurlik reg. (Translation of Afrikaans paragraphs follows.)

[The total income of the state for the current financial year is approximately R369 billion. The direct personal income tax is approximately R116 billion. This does not include indirect tax such as VAT. A considerable amount thereof is paid by Afrikaners – that is for sure – but Afrikaners should know: you have no say over how a single cent of that will be spent. You pay your share of the tax, and enough thereof, but others will decide what they want to do with it.

On Friday 18 February Premier Rasool opened the Western Cape’s provincial parliament. He made much of the ANC’s endeavour to make the Western Cape a home for all its residents; a province where just about 60% of the residents are Afrikaans-speaking.

The verdict in the Mikro Primary School case was delivered in the Cape High Court on the same day. And bear in mind that Mikro is not a school for whites only, because children of all communities are accommodated there. Afrikaans is the point of issue. The judge ruled that the Western Cape’s education department acted outside its powers and also ordered them to pay all legal costs. The court ruled that the ANC acted incorrectly.

I immediately wrote a letter to Premier Rasool and asked him to consider the matter very carefully: “Do not react hastily and decide to appeal. If you and the ANC are really serious about making the Western Cape a home for all, including its 60% Afrikaans-speaking residents, then just think what signal the ANC is sending them if you deny them the right to have single- medium Afrikaans schools.”

We, of course, know the pattern: first one class, then later a dual-medium school and, later still, a single-medium school, namely English. But no, we are back to ANC imperialism. Cameron Dugmore, the toyi-toying local minister of education leads the onslaught – with my tax money and that of other Afrikaans speakers, of course. All Afrikaans speakers must know very clearly that the ANC is not their friend; on the contrary.

Approximately three years ago, I cautioned the NNP when they left the DA to jump into bed with the ANC. I stated from this podium: ”The ANC is not really crazy about you. Their aim is to destroy the NNP”, and I was right, of course.]

Quite often people would like to refer to the 1994 transition as a miracle. It was not a miracle. How can it be a miracle when one side capitulates? In that case it is not a miracle but surrender. And that is what the NP did. Now the Nats are all joining the ANC. Can anyone.

Mr N J GOGOTYA: Chairperson, the speaker is giving an impression in his presentation here that the ANC is against the Afrikaners as a nation and as a group. Isn’t it racial stirring up of emotions to make the statement that the ANC, a particular grouping of people, are against a particular race of people?

Hy het gesê die regering is teen die Afrikaners, en is nie hulle vriend nie. [Tussenwerpsels.] [He stated that the government is against the Afrikaners and is not their friend. [Interjections.]]

If you are not a friend then you are an enemy. Please, we need your ruling on that, Chairperson.

The HOUSE CHAIRPERSON (Ms C-S Botha): Thank you, hon member, I believe that this is part of our robust debate and that the speaker can continue. Thank you.

Dr C P MULDER: You are wasting my time. Can anyone for one moment imagine Yasser Arafat or Abbas from the PLO joining Sharon’s Likud party, or Gerry Adams and others from Sinn Fein in Northern Ireland suddenly joining the Conservative Party in London? Absurd, isn’t it? But that is exactly what NNP are doing. The Nat Leaders are running for cover to the ANC. But remember, their followers will not follow.

Hierdie ANC-gedrag word aan alle Afrikaners voorgehou as die norm. Die ANC sê . . . [This conduct of the ANC is presented as the norm to all Afrikaners. The ANC states . . .]

Mr N J GOGOTYA: Chairperson, on a point of order: The hon member ascribes the statement that he has just made to the NP and does not include the late Dr Connie Mulder as part of the people that he is speaking against. Thank you.

Dr C P MULDER: Sit down, idiot.

Op sommige plase kry ’n mens wat bekend staan as ’n werfbobbejaan. Dit is ’n makgemaakte bobbejaan wat op die werf rondhang, ’n soort attraksie. Hy is vas aan ’n ketting en hy hoort nie regtig daar nie. Die boer verduur hom, wys hom vir sy vriende en gooi af en toe vir hom ’n lemoen. As die NNP so opgewonde is . . .

Die HUISVOORSITTER (Me C-S Botha): Agb spreker, u tyd is verstreke.

Dr C P MULDER: . . . om daardie rol in die ANC te vertolk, moet hulle nie vir een oomblik dink dat alle Afrikaners daardie roete sal volg nie. Vergeet dit!

Die HUISVOORSITTER (Me C-S Botha): Agb spreker, u tyd is verstreke.

Dr C P MULDER: Ek wil regtig voorstel dat die agb swepe met daardie lid praat en vir hom verduidelik, as hy nie verstaan wat in hierdie debatte aangaan nie, is hy regtig op die verkeerde plek! [Tussenwerpsels.] (Translation of Afrikaans paragraphs follows.)

[On some farms you find what is known as a farmyard baboon. It is a domesticated baboon that hangs about the farmyard, a kind of attraction. He is tied to a chain and does not really belong there. The farmer endures him, shows him off to his friends and tosses him an orange now and then. If the NNP is so excited . . .

The HOUSE CHAIRPERSON (Ms C-S Botha): Hon speaker, your time has expired.

Dr C P MULDER: . . . to play that role in the ANC then they must not for one moment think that all Afrikaners will follow that route. Forget it!

The HOUSE CHAIRPERSON (Ms C-S Botha): Hon speaker, your time has expired.

Dr C P MULDER: I really want to suggest that the hon Whips speak to that member and explain to him that if he does not understand what is taking place in these debates, then he is really in the wrong place! {Interjections.]]

The HOUSE CHAIRPERSON (Ms C-S Botha): Hon member, order, please! Order, please! Your time has expired. [Interjections.]

Mr B E PULE: Thank you, Chairperson. Allow me to congratulate the Minister and his department for a comprehensive Appropriation Bill setting out the national Budget that entails two main components, namely the expenditure side of the Budget and the revenue side.

It is further hoped that, as the Public Finance Management Act, Act No 1 of 1999, dictates, individual departments have developed strategic plans, objectives, programmes and subprogrammes in order to commit the amounts to be spent. Looking at the share in the national Budget allocation analytically, and of course excluding the government debt service costs and equitable share, individual departments’ share order is as follows: One, Social Development with 25,54 %; two, Safety and Security with 12,85%; three, Defence with 10,14%; four, Provincial and Local Government with 7%; five, National Treasury with 6,31%; Six, Education with 5,59%.

One notes that Education is not one of the top five departments that receives the greatest share because it manages policy and transfers few of its budget amounts for tertiary education purposes and, further, most of the implementation is done at the level of provincial departments.

It is, however, a cause for concern to note that spending trends at those levels were relatively slow in the third quarter of the previous financial year, 2004-05; when they were a mere 42,9% of capital expenditure. Government can really ill afford this tardy development, as skills are the government’s priority.

Looking further at the share order of departments, one would have thought that Health and Agriculture could have featured as number two and three on the list respectively, instead of Safety and Security and Defence. This does not suggest that they are not important, but the Department of Agriculture has to lead and support sustainable agriculture and promote rural development through ensuring access to sufficient and safe and nutritious food and also maximise growth, employment and income, to ensure the improvement of the economy of our country.

The aim in the Health Department, according to the Bill is “to promote the health of all people in South Africa through a caring and effective national health system based on a primary care approach.”

One observation is that capital payments in this national Budget represent a small allocation in expenditure and there has to be some form of commitment to infrastructure development. In the event of some transfers in individual Votes to other spheres of government and delegated agencies, those have to be monitored through legislative oversight, and this of course poses a big challenge for the public representatives.

Another observation is that current payments, which entail operational expenses, constitute a huge percentage of the national Budget. And bureaucracies need to function better and efficiently to avoid roll-overs, unnecessary committed funds and haphazard spending at the end of the financial year.

Ga re gane gore jaaka ke buile ka ditlhomagano tsa mafapha gore madi a ka bo a ile kae, tse dingwe ga di tlhokege. Mme re tla tsaa-tsia gore mo nakong e e fetileng ntwa e kgolo e ne e le gore dipuso di ne di busa ka mapodisi le masole, ke sone se kereng go a gakgamatsa fa o bona tekanyetso ya gompieno e naya mapodisi le masole madi a a fetang.[Nako e fedile.] (Translation of Setswana paragraph follows.)

We do not disagree, as I have stated in relation to the arrangements of the departments, as to the whereabouts of the money because these explanations are unnecessary. But, one notes that in the past the main problem was that states used the police and soldiers to suppress people. That is why it is not surprising to note that today’s Budget gives the police and the soldiers money that exceeds . . . [Time expired.]

The UCDP supports the Appropriation Bill. [Applause.]]

Mr G G OLIPHANT: Chairperson, hon Minister, comrades and colleagues, this national Budget represents a numerical expression of our policy implementation and government’s priorities for this period. In this Budget the ANC government seeks to create an equitable balance in our society and to redress the plight of the poor in particular.

It is in this context that I convey the appreciation of senior citizens in my constituencies of Warrenton and Strydenburg to the Minister of Finance for the increase in their pensions. Re a leboha ntate. [Thank you, sir.]

These pensioners and parents would like to send a word of thanks to the ANC government for the improvement brought about in their lives since the 1994 democratic breakthrough. Before I proceed, I also wish to give a message to the UDM from my colleague, Comrade Mzondeki, which reads as follows:

There is nothing wrong with disabled people queuing for jobs if the work environment is friendly, unless you think they are sick. In fact, the majority of persons with disabilities cannot wait to get out of the pension queue and join the workers. The Budget makes provision for them to get the necessary skills to compete for employment.

That is what the comrade is saying in his message to the UDM.

Ek wil ook sê dat dit onwaar is, agb Mulder, dat die ANC nie ’n vriend van Afrikaanssprekendes is nie. [I also want to say, hon Mulder, that it is untrue that the ANC is not a friend of Afrikaans - speaking people.]

Afrikaans speaking people are actually friends of the ANC and also belong to it. [Applause] So, don’t try and appropriate Afrikaans to belong to only the three men sitting around you. If you are not friends of the ANC, don’t make a general statement that says: “Alle Afrikaanssprekende mense is nie vriende van die ANC nie.” [All Afrikaans-speaking people are not friends of the ANC.]

Today we are debating this Budget in a critical historic context, as it is almost a century since the formation of the ANC in 1912 and 50 years since the adoption of the Freedom Charter in 1955. In both these instances, we pride ourselves on the impressive track record of our glorious movement, particularly in the past decade.

We also take a moment to remember the giant of our struggle, Comrade Joe Slovo, who past away 10 years ago. The President, in his state of the nation address, referred to “the confluence of encouraging possibilities”.

We find ourselves in those possibilities as a country during this period.

South Africa is gradually becoming a country of happy people, Comrade Obed. We are an important regional and global player for democratic transformation, working tirelessly for peace, security and economic growth. We are well positioned to host the 2010 World Cup, which has enormous economic and cultural returns for South Africa and, broadly, for the African continent.

During our 10 years of democratic rule we have hosted important international events, for example, the World Summit on Sustainable Development, the international conference on HIV/Aids, The World Conference against Racism and Xenophobia and, most recently, the Pan-African Parliament.

Just this month, on 5 and 6 March, we celebrated the 50th anniversary of Sactu, the South African Congress of Trade Unions, the predecessor of Cosatu. Both these organisations were formed to fight for the rights of workers and for the transformation of South Africa from apartheid to democracy.

Later this year Cosatu will also be celebrating its 20th anniversary of fighting for human rights. Workers’ rights are indeed human rights. It is therefore fitting at this juncture to examine the role trade unions have been playing in improving the lives of workers.

It is also appropriate at this time to examine this important matter in the light of the proposals by the DA regarding the deregulation of the labour market. They have already lost this debate in the first and second sessions of Parliament and are bound to lose it in this session. [Interjections.]

The ANC government has succeeded in regulating the labour market in the national interest compared to the situation prior to 1994. In the process we have achieved a reasonable economic growth rate, good governance and good labour relations. The track record of the DA is very disappointing when it comes to this subject, to say the least. [Interjections.]

What even makes this debate a bit boring is that they support everything we are saying now! But it is okay, I think is for good governance. Thank you very much for supporting the Budget.

In 1995, just to illustrate our track record, we passed the Labour Relations Act to strengthen collective bargaining in the country, and the DA disagreed. We went on to pass the Basic Conditions of Employment Act in order to ensure decent minimum conditions for workers and again the DA said no!

In 1998 we passed the Skills Development Levies Act to address skills shortages in the economy, and again the DA pressed the red button. But they are the ones who, from time to time, come here and complain about skills, and about everything that goes wrong in the country, even that which has been successful, but is an indication of what they want to do in this country.

We passed the Employment Equity Act to redress the discrimination workers experienced during apartheid, whilst they were basking in the glory of apartheid at the time. Once more, the DA unsuccessfully called for a division in this House.

In 2001 we passed the Unemployment Insurance Act and, predictably, the DA opposed it once again. The undeniable truth is that the DA does not care about the rights of workers in this country. [Interjections.] [Applause.] That is why workers of this country have no reason to vote for the Democratic Alliance. [Applause.]

Now their latest target is to scrap Nedlac, the National Economic Development and Labour Council, which is an important institution for social dialogue. Once again, they are bound to lose this debate. The Setas are also here to stay, Mr Davidson, and we are determined to make them function properly. Given their track record of voting against labour legislation, is it not ludicrous that the DA would now want us to believe that they are the champions of the poor and the unemployed? What a joke!

In a few days, the country will be celebrating Human Rights Day, and in line with our evergreen document - Comrade Dan Montsitsi refers to the Freedom Charter as such - we have gone a long way towards achieving equality in our society. We are now 11 years into our democracy. How do the achievements and programmes of this government measure up to the vision embodied in the Freedom Charter, our evergreen document?

The adoption of the Constitution of the Republic of South Africa is certainly an embodiment of the vision of the Freedom Charter. Today the supreme law of our country provides that everyone is equal before the law and has the right to equal protection and benefit of the law.

The Bill of Rights provides emphatically that equality includes the full and equal enjoyment of all rights and freedoms. Unlike 50 years ago, when the Freedom Charter was adopted, today the state may not unfairly discriminate against anyone on the basis of race, gender, sex, pregnancy, marital status, ethnic or social origin, culture, language and a host of other grounds.

Today every person in this country has the right to a basic education and to further education, which the state, through reasonable measures, must make progressively available and accessible. Unlike the violent years of apartheid when Afrikaans was brutally imposed as a medium of instruction, today everyone has the right to education in the official language or languages of their choice.

For example, in the Northern Cape province, the !Xu and the Khwe communities have access to learning in their mother tongue and a school of their own, as well as their own community radio station. Everyone in South Africa has the right to use their language and to participate in the culture of their choice. If you don’t want to participate in your own culture, that’s your own choice; don’t blame the ANC for it. Persons belonging to cultural, linguistic and religious communities may not be denied the right to enjoy these or to form associations in this regard. That is what the Constitution provides.

Today we have a Constitutional Court, the guardian of the rights contained in the Bill of Rights and the highest court in the land. The Constitution recognises 11 official languages, including Afrikaans. PanSALB was established to promote multilingualism and to create conditions for the development and equal use of all official languages.

We also have a National Arts Council. [Interjections.]

Dr P W A MULDER: Chairperson, the hon member has 14 minutes and I had only five!

The HOUSE CHAIRPERSON (Ms C-S Botha): Sorry, hon member Mulder, may I ask the speaker to sit down before you continue. Would you like to raise a point of order?

Dr P W A MULDER: Chairperson, I would like to ask the hon member a question. He has 14 minutes; surely he has time. It is an easy question.

The HOUSE CHAIRPERSON (Ms C-S Botha): Hon speaker, will you accept a question?

Mr G G OLIPHANT: Chairperson, when I have finished. Just stay where you are. I might just be answering your question as I speak now. We also have a National Arts Council whose responsibilities are to develop, promote and support the arts and culture in the country. Our systems are in place.

In addition to our new national flag that was brought into use on 27 April 1994, we have, over the past few years, transformed our national coat of arms and national orders. Today these symbols reflect the diversity of this beautiful rainbow nation; a nation which has become the envy of the world despite attempted distractions of the DA and their cohorts. Other arts and cultural organisations that were established to bring to life the rights contained in the Constitution are the National Heritage Council, the SA Heritage Resource Agency and the SA Geographical Names Council.

These bodies have a continuing agenda of ensuring that our symbols and cultural institutions are representative of the South African nation. This is the Freedom Charter brought to life. Today we can proudly say that all national groups have equal rights.

This does not mean that we do not have challenges. For instance, there are still names of areas, streets and buildings that must change and be replaced by names with which the historically discriminated national groups can identify. Recent examples of language discrimination in the Western Cape, as well as in some schools in the Northern Cape, tell us that not all official languages are fully recognised in our society. However, we have complete confidence in our Department of Education to deal decisively with these matters.

We are, of course, not alone in facing these challenges. A recent report of the United Nations development programme in 2004 identified certain global threats as being “racism, sexism, xenophobia, ethnicity and nationalism, religious intolerance, economic, social and political discrimination.”

The report also highlights one of the key global challenges as being the recognition that cultural diversity is an inescapable part of the future landscape of politics in the 21st century.

These global challenges are also challenges in our own country. We cannot allow them to go unheeded. This House must be vigilant in protecting and promoting the rich diversity of our country.

The ANC supports this Budget Vote.

Dr P W A MULDER: Chairperson, can the hon member take his question?

The HOUSE CHAIRPERSON (Ms C-S Botha): Hon member, since your time has not expired, are you prepared to take a question?

Dr P W A MULDER: Chairperson, it is an easy question. The hon member speaks very highly of the Constitution and all the wonderful protection, and the ANC is supposedly the champion of that. Now, let me take you to section 29 of the Bill of Rights that deals with education and also makes provision for single-medium institutions.

That being the case, if the ANC accepts the Constitution and the Bill of Rights, why is your government in the Western Cape appealing and taking the decision of the court to the High Court and the Constitutional Court and not accepting the right of that community of parents who are entitled, in terms of the South African Schools Act, to have a single-medium educational institution? Why are you appealing that decision?

Mr G G OLIPHANT: Chairperson, the hon member is asking me a question on matters that are still before the courts. Can we allow that process to proceed?

Dr S E M PHEKO: Chairperson, the PAC will vote for this Appropriation Bill. But I want to comment as follows: We are taught in life to learn to do good, seek justice, relieve the oppressed, defend the fatherless and plead for the widowed. It is one thing to accept that a volcanic eruption will result in the deadly flow of lava, but quite another to acquiesce in a process that leads to suffering that can be changed by human intervention.

The 2005 Budget is about choice - the choice to prevent thousands dying from crumbling human immune systems caused by HIV/Aids; the choice to stop rewarding small pockets of prosperity, while over 63% of women in rural areas continue to live in chronic poverty; the choice to prevent one man from making a bonus of R11 million, while over 51% of the population does not enjoy the right to work.

The PAC welcomes the overarching goal of advancing social development and reducing levels of inequality. However, rapid economic growth does not automatically benefit the jobless and the rural people without an appropriate distribution mechanism. The economic system of this country is suffering from a systematic breakdown, but we are not willing to acknowledge it. Under the current Budget and macroeconomic framework, we will never achieve full employment. The implications of this are so detrimental that it is imperative to formulate an alternative.

The Minister tells us that the answer is to grow small business. However, small African businesses in communities across this country are being taken over by big business. The local tuck shop is being invaded by Pick ’n Pay. The street fruit sellers are being invaded by the Fruit and Veg City franchise. Big business centralises, employs technology, rationalises and sacks thousands of people. Small business is not doing business. It is going out of business faster than it is being created. Small business does not employ many people. It relies on families to work for half-pay. What we need from this Budget is direction on how to create livelihoods for our country. The point is: When will the Budget support the creation of social entrepreneurs, scientists, writers, artists, inventors and thinkers, and link that kind of work to income as part of normal life in our country?

Economic growth is essential for our country. However, it is not a panacea for poverty if the poor do not share in it. If it does not work for people; if it does not serve the people; if it creates job insecurity and falling wages, and if it does not create an adequate social security safety net for the aged and children, we need an alternative model. We need economic growth with social equity. This means addressing how economic growth is generated - the pattern and rate of growth and who benefits from this.

South Africa does not have a financial deficit. There is no scarcity of money. Money is not our problem. The fact that 12% - over R55 billion of the 2005 Budget – has to go towards paying the odious apartheid debt is a scandal in a country faced with deepening and chronic poverty.

Poverty eradication, inequality and a lack of redistribution of wealth remain a defect on our country’s landscape. They pose the most serious threat to the consolidation of democracy. The market has failed to achieve significant redistribution. The PAC would welcome a broad-based redistribution programme on behalf of the poor. This is imperative and cannot be stalled forever.

Izwe lethu, hhayi labanye. Futhi-ke izwe lethu akulona idikazi ngeke libe ngelawo wonke umuntu [Kwaphela isikhathi.] [Ihlombe.] [Our land, not for others. Our land cannot just be for everybody.] [Time expired.] [Applause.]]

Ms S RAJBALLY: Thank you, Madam Chair. All South Africans eagerly await this time of the year as it is the time when our hon Minister of Finance and his competent finance team unveils the best-suited Budget for our economy with regard to operation, progress, development and advancement.

South Africa is home to approximately 46,6 million South Africans, as estimated by Statistics SA. This population, hindered by the seriousness of poverty, depends on a well-formulated Budget to release them from this situation and open doors to better living conditions, prosperity and social development. From the birth of our democracy, South Africa, under the people’s governance, has managed to unshackle itself from the horrific remains of the apartheid regime.

Today we stand subject to our ninth Budget in which, it appears, our hon Minister of Finance is aiming to motivate South Africans to be self- reliant. The Appropriation Bill, eagerly awaited by the various spheres of government, delivers a comprehensive division of Votes. With regard to the Appropriation Bill 2005, the MF observes the suitable division of funds awarded in view of the needs for the further development and advancement of South Africa. We acknowledge and approve the larger share of our national Budget, 26%, being allocated to social development. We trust that this investment in the impoverished areas will greatly free South Africa from the biggest challenge of poverty.

The MF takes this opportunity to voice its discontent regarding this year’s allocation for pensions and child grants. We firmly put our aged citizenry on a pedestal for being the pioneers of our democracy who should be earning a reasonable pension that would allow them to reap the benefits of their hard work.

The child of South Africa needs to be provided for adequately, and the allocated amount for this is not sufficient. Our old and young are of primary importance to us, and because of the constraints of poverty the responsibility is upon us to substantiate the Budget allocation to this department.

Though crime levels have decreased in some areas, they have increased in others. Minimal resources in manpower in the SAPS hinder our attacks on crime prevention, deterrence and eradication. The Budget for 2005 serves to correct this shortfall by increasing the number of police persons, and by facilitating the maintenance and necessary construction of police stations, courts and prisons.

Salaries and better management are also on the agenda. The MF hopes that these funds shall be utilised adequately and that the progress that the sector of safety and security has achieved will bring crime in South Africa down significantly. We further call for the improved accessibility of the SAPS for more rural areas and for persons who are geographically isolated.

Having Defence accounting for 10% of the Budget is substantiated, and supported in view of our peacekeeping operations through the AU and the PAP. Internationally, we are being condemned for our tiptoeing around the Zimbabwe issue. Our larger responsibility is to Africa, and our commitment to SADC, Nepad, the AU and the PAP requires intervention on the Zimbabwe issue. Africa cannot allow human injustice on the continent ranging from colonialism, apartheid and our own horrific past. Why do we dance to the tune of an oppressor?

Provincial and local government appear to be a priority in this year’s Budget allocation. The MF calls on the municipalities to welcome and utilise allocations with determination, efficiency and confidence to achieve effective results and development in the necessary areas. The needs of communities vary, and the MF believes it is the responsibility of local government to bring these needs to the table.

The National Treasury, with its firm aims of promoting economic and social development as well as good governance, receives a suitable portion of 6% of the national Budget.

An educated nation is a stronger nation. Our government is working hard to attain equal, accessible education for all minors and adults. Many policies, schemes and programmes have been endorsed to attain this. The building of schools seeks to end the days of children learning under trees, and the R7 billion for increasing teachers’ salaries and R776 million for the National Student Financial Aid Scheme are all benefits that will assist in attaining an educated South Africa.

The government’s commitment in developing and prioritising our infrastructure is noted through Votes such as Transport and Communication reflecting a gradual increase.

We applaud our Minister for introducing this Budget. The MF supports the Appropriation Bill. Thank you very much. [Applause.]

Dr P J RABIE: Madam Chair, hon Minister, hon members of the House, the Budget before us today was tabled in an environment of relatively low inflation, improved business and consumer confidence, and a large tax revenue windfall.

This has given the Minister space to announce a mildly expansionary Budget. Despite limited growth in some sectors of the economy due to the strong rand, the economic prospects for 2005-06 remain positive, provided that the global economy remains healthy and crude oil prices stay affordable. We hope that the downside risks associated with a pro-cyclical stimulatory Budget do not preclude a very necessary loosening of monetary policy.

The DA welcomes the set of tax breaks for small business and the 1% reduction in the corporate tax rate. But we do wonder if these cuts are sufficient to make our tax system truly investor-friendly. For example, we believe that the net effective corporate tax rate is still too high. And in this regard we appeal to the hon Minister to implement the phasing-out of the secondary tax on companies. This tax is generally not well understood by foreign investors - allow me to finish, hon Minister - and may act as a deterrent to fixed foreign direct investment. [Interjections.]

The DA also notes with regret that this particular Budget lacks any further relaxation of exchange controls. It is our opinion that the full abolition of exchange controls, including administrative requirements, will encourage foreign and domestic direct investment and will provide currency stability by allowing the rand to reach its true level.

While we welcome the increase in the tax threshold to R35 000, we feel that the retention of the 18% on the taxation of retirement funds is deplorable. What this means is that a large number of retirement-funded members are still subject to double taxation. Thousands of pensioners experience profound difficulties in meeting ever-increasing medical and housing expenses, even as the Minister continues to renege on his commitment to Parliament to table legislation on the taxation of retirement funds.

The Minister’s own Budget Review reports that our savings rate has dropped from 16,2% of our gross domestic product in 2003 to only 14,7% of GDP in

1. This situation can only be rectified if government immediately cuts taxation on retirement funds by a third each year for three years.

Alternative revenue sources for the potential loss of the income presently derived by revenue are available from the broad set of efficiency gains, consolidations and cuts in the wasteful expenditure detailed in the DA’s alternative budget, which we presented in the week before the Budget.

Our alternative budget also contains a proposal to abolish capital gains tax, which we feel should have been included in the Budget before us today. This form of taxation is costly and difficult to administer. In addition, the recent sharp and sustained increases in residential property prices have had a negative effect on income derived by the lower end of the market. This is highlighted by the fact that the average price of residential property in many suburbs is in excess of R1 million, the CGT threshold.

The main contributors to South Africa’s lacklustre economic growth performance are our chronically low rates of foreign and domestic investment. The broad base of tax cuts I have proposed today will go some way towards turning this situation around.

While this approach will result in reduced government revenue in the short term, we believe that the long-run growth and investment effects will more than make up for this revenue loss. For example, Ireland, and indeed some of our neighbouring trade partners, have lowered corporate tax rates to attract new investment and, in the process, have increased their tax take, and I hope the Minister takes note of this. Such bold steps are required to . . . [Time expired.][Applause.]

Ms J L FUBBS: Hon Chairperson, members of the House and South Africans outside this House, this is a people’s Budget.

Yebo isabelo sezimali sabantu. [Yes, it is a Budget for the people.]

Ja, dit is ’n Begroting vir die mense. [Yes, it is a Budget for the people.]

It is a redistributive Budget and a Budget that bridges the barriers between the first and the second economy. Indeed it is a reaffirmation of the Freedom Charter and its vision of a country in which all of its people, especially the poor, share in our wealth.

Interestingly enough, it is quite clear that the persuasive powers of this Budget and its optimism have proved contagious, to the point where we see a welcome turnaround from the DA as expressed by Ian Davidson in the House today.

Although subsequently we had a number of qualifying comments, the ANC welcomes this expansionary Budget, a Budget that reflects the Government’s commitment to three prioritised challenges: poverty, unemployment, and the stimulation of productivity and investment from the private sector.

Growth, sustainable development and equity are identified as the key instruments that will be used to implement the outputs and achieve the outcomes of this redistributive Budget. Indeed, what this Budget demonstrates and what the enthusiasm with which it has been grasped demonstrates is the resurgence of Africa and the spirit of hope that is beginning to prevail in South Africa and embrace all, even those who prevaricate on the margins of liberalism. The priorities reaffirm the call of the Freedom Charter for all people in South Africa to work together to bring about social and economic justice in which all people share in the prosperity of the country, a country in which race, sex and religion do not determine a person’s potential.

Indeed, this Budget directs resources, human and financial, directs performance and drives delivery. Public Enterprises is poised to fuel massive infrastructural development in Eskom and Transnet. Simultaneously, R3 billion earmarked for the Expanded Public Works Programme targets the unemployed and focuses on labour-intensive employment.

Emerging entrepreneurs benefit from several measures, such as less paperwork, generous tax cuts and increased financial access to finance and skills upgrading. Private sector investment is stimulated and indeed even bond traders get a lift.

The actual, maintained low inflation is extremely important in ensuring the protection of the wages of workers. The 60% investment in Social Services is supported by R160 billion for new investments to fuel economic growth. The redistribution role of the Freedom Charter certainly finds expression in this Budget. But, what are some of these measures that will spread South Africa’s economic growth benefits? How will the poor benefit?

Chairperson, this is how it will be done.

Kwezemfundo othisha bathole R6,9 billion amaphoyisa athola R4,2 billion wamaholo. Izindlu zithole R2 billion. [In Education teachers receive R6,9 billion and the police receive R4,2 billion for salaries. Housing receives R2 billion.]

Land, which is a critical issue in any country that has previously been colonised, gets R6 billion to finalise rural land restitution. Community infrastructure gets a significant increase in financial resources to target water and sanitation, clinics, multipurpose centres, schools, police stations and roads.

The roll-out of basic services through local government is accelerated and there are increased funds for in-house capacity development.

Ten spyte van dié uitdagings in ons land het die ANC-regering bewys dat ons die politieke wil het om ’n nuwe Suid Afrika vir almal te bou.

Die arm mense sal met hierdie Begroting weet dat hulle ook ’n plek in die son het en dat daar ’n regering is wat deur middel van hulle optrede bewys dat hulle vir al die mense omgee. (Translation of Afrikaans paragraphs follows.)

[In spite of these challenges in our country the ANC government has proved that we have the political will to build a new South Africa for all.

This Budget will assure the poor people that they also have a place in the sun and that there is a government which has proved by means of its actions that it cares for all the people.]

Unlike a few market Jeremiahs, I believe the credibility developed under a course chartered by the ANC-led government with Manuel and his shipmates navigating with discipline and determination, continues, with this Budget, to steer us safely through global financial storms that prevail.

The upward revisions of the growth of the Gross Domestic Product, or GDP, from about 3% to 4% have contributed to increased revenue collections and could hardly be considered a windfall when it was planned.

It was planned because the economy was well managed and revenue collections were robust, as has already been stated clearly in this House. These revenue collections have also led to a much smaller than expected deficit to the GDP ratio in the current fiscal year.

This configuration strengthened where financial consistency has also resulted in an increased ratings agency upgrade. Such an encouraging and enabling economic environment surpasses most emerging countries and indeed in some areas challenges some of the developed countries. For example, the steady increase in social expenditure from a constrained public purse and also the decades of impoverishment of the majority challenge social governments such as Sweden and Britain who never came from that legacy.

This year’s Budget also targets the critical challenge of the skills mismatch with the growing economy.

Isabelo sezimali sikhombisa ubuntu. Lokhu kukhonjiswa ukukhuliswa kwe- social grant. Inhloso ukuthi kukhuphuke amaholo abantu bonke abampofu ngokuba bafunde amakhono emisebenzi. Lokhu sikubona ngezimali ezifakwa ekufundiseni amakhono emisebenzi. [Ihlombe.] (Translation of Zulu paragraph follows.)

[This Budget shows ubuntu. The increase in the social grant shows this. The intention is to increase the grant for all destitute people so that they can acquire skills. Our preparedness in this regard is shown through the monies that we invest in training people.]

To raise the profile and capacity of this sector to respond to the skills development, R1,5 billion will be invested in the recapitalisation programme plus R50 million for planning and other targeted interventions. The focus will be on scarce and emerging skills necessary for this rapidly changing economy. Training, with all due respect even to my own church, will no longer focus on Bible studies and other things. But, training informed by national and provincial requirements, regular reports on skills shortages and labour market trends, will ensure that enlightenment in specific areas assists colleges to be more responsive to the requirements of a changing economy. Access to funds will be directly linked to business plans to meet these objectives.

Our real growth averages about 5,5%. [Interjections.] Indeed it does, and those who need a calculator, please let me know. Not since the Second World War has economic growth hit such high levels. But unlike that period when so many resources were used for so few people . . . [Interjections.]

An HON MEMBER: Why are you pointing at us?

Ms J L FUBBS: Because I hear a note of confusion with the hon Mr Davidson. Now such increased resources will be spread to many more people, particularly the most vulnerable, namely the poor, children, youth, the unemployed and the pensioners.

Indeed we have given people hope in the face of challenges to which others offer a vision factored in with vouchers, a solution resolved on paper without any realistic appreciation that this is South Africa, Afrique du Sud and not Europe or Britain. [Applause.] This Budget expresses the ANC’s vision for a better life in an unambiguous commitment of resources.

The revolutionary poet concretises the dreams of the people in saying, “yesterday we had a dream.” Today these dreams have become a reality and been given fresh expression in a Budget through macroeconomic interventions of the state which our market cannot give and will never be able to give, as Sweden has found out, as Britain has found out and as Bush himself is finding out. [Applause.] Ngiyabonga. [Thank you.]

I want to say - seeing that I have two or three minutes left - that Steve Biko, with whom I was at university in Natal when he was studying at the medical university there, and perhaps some of you do not know who he is, said: “Ours is a . . . society whose sacred tradition is that of sharing” and I say . . .

An HON MEMBER: Ja, tannie. [Yes, auntie.]

Ms J L FUBBS: I am not your “tannie”, I am a grandmother.

And I say not the exploitive tendencies coupled with the overt arrogance that often resides in the hearts of some – and I emphasise “of some” - who espouse capitalism. Yes, I also want to say that the ANC government with this Budget that we fully support and I fully support, creates employment and has the capacity to overturn the nightmare of the past, deliberate discriminations. But of course I also say to all of us here in Parliament, all of us here in this House: We have a set of Estimates of Expenditure. It is our duty, the duty of everyone in this House, to monitor how well that expenditure is felt in the community.

I thank you. [Applause.]

Dr E NKEM-ABONTA: Madam Chairperson, the DA welcomes the Budget’s emphasis on small business. However, the current strategy of small business development as reflected in the Budget assumes the problem is merely or mostly financial. I would want to submit today that the problem is much deeper than that. Actually the problem - if there is any one particular problem - is insufficiency or lack of entrepreneurship.

On entrepreneurship, South Africa lags behind many countries even on this continent. Now compared with Brazil, it does even worse. What should therefore be done? The government should take measures to develop entrepreneurship as a matter of urgency. Its entrepreneurship policy - the one that we recommend, at least - should aim mainly at removing obstacles that currently stand in the way of the entrepreneur. In this regard the DA welcomes the government’s plan to reduce the administrative burden that small businesses currently face. We welcome that plan. We also welcome government’s plan to deregulate the labour market for small businesses. The President even gave clear timeframes for doing this.

We are, however, dismayed and in fact concerned when we hear contradictory statements made by Ministers of state, by ANC MPs and by high government officials regarding the much-needed deregulation of the labour market for small business. The DA urges the government to move boldly with resolve and determination and not waver at this point in time. For what is really at stake is the chance to grow the economy and provide jobs for millions of black people. The issue is that important. Indeed, every piece of research conducted by independent boards in this country has pointed to labour market rigidities and the administrative burden currently faced by small businesses as the main impediments to growth and development.

We therefore urge government to take the matter seriously and not be misled or swayed by certain sections of the ruling party. With a deregulated labour market and a significantly lessened administrative burden than we currently face, we guarantee, I guarantee and every economist understands that we will unshackle the spirit and practice of entrepreneurship. What would then follow? What would be the consequences of this? We would have higher rates of growth, we would have lower rates of unemployment and we would have increased economic welfare for all.

In conclusion, the DA supports the Budget, but recommends that the government heed the call of the entrepreneur in whom alone - and I repeat, in whom alone - lies the solution to our growth and unemployment problem. The question is: Would government accept this challenge? When we hear noises contradicting, threatening to scuttle a well-needed reform programme, we in the DA can only stand behind government at this point in time and ask government to remain or stand firm and carry through just like it has done with other policies – that is those regarding macroeconomic stabilisation. If this is done, I guarantee that we will go a long way towards bridging the gap between the so-called two economies – the first and the second. Thank you. [Applause.]

Ms L M MASHIANE: Madam Deputy Chairperson, Minister, hon members, ladies and gentlemen, I rise to support the Budget by Finance Minister Trevor Manuel. It is a Budget that reflects benefits for all South Africans, but of utmost importance it is a Budget that deals with the aspirations of the majority of our people, a Budget for the poor.

Kgaratlho ya go tlhama ditiro le go tlisa tshireletsego go baagi botlhe ba Aforika Borwa le tsweletso ya diphetogo mo dikunong le mo moruong, e lebisitse kwa go fetoleng ga leruri ga puso e e neng e tlhaola batho, mme e ba beela kwa thoko, go isa kwa go e e leng ya batho mme e ba akaretsa botlhe jaaka e le Maaforika Borwa. (Translation of Setswana paragraph follows.)

[The fight to create employment and security for all South African citizens, the ongoing recovery in production and in the economic sector led to the transformation from a government which marginalised people, to one that belongs to the people and which ensures integration and further reaching out to all South Africans.]

In analysing the Freedom Charter, Umrabulo No. 11 says:

The state shall recognise the right and duty of all to work and to draw full unemployment benefits. Men and women of all races shall receive equal pay for equal work.

And goes further to say:

The use of child labour, the housing of male workers in single men’s compounds, the system whereby workers on wine farms are paid tots of wine as part payment on their wages, contract labour – all these pernicious practices shall be abolished by a victorious revolutionary government.

How far have we gone to achieve these ideals in these 10 years after celebrating our democracy? The 14th of February marked the end of a five- day international conference on child labour in the Indian city of Hyderabad, which was organised by the International Confederation of Free Trade Unions. This city was chosen because India houses an estimated 60 million of nearly 250 million child labourers worldwide. It is reported that one in every six children in the world aged between 5 and 17 is now exploited as a worker.

Children labour in mines and quarries, in homes, in carpet and garment factories, usually for little or no pay, are frequently malnourished and often subjected to physical and sexual abuse. South Africa is not immune. In South Africa it is a criminal offence to employ a child under the age of 15 except if you have a permit from the department to employ children in the performing arts. According to the Act children aged between 15 and 18 may not be employed to do work that is inappropriate for their age or work that places them at risk.

Child labour is still rife during the harvesting periods in the North West. It doesn’t stop because parents have no choice but to allow it for them to keep their underpaying jobs and a place to sleep. Recognising that child labour is to a great extent caused by poverty and that the long-term solution lies in sustained economic growth leading to social progress, in particular poverty alleviation and free basic education, one of the interventions by the North West government is through easy accessibility of educational resources with the Farm Child Project, which identified 10 routes passing through the farm areas and deployed buses to assist learners attending schools located in the farms. Also, 197 schools have been reached in terms of bicycle projects. The North West, like most provinces, is faced with a problem of farmers who are still violating the Extension of Security of Tenure Act. Farmworkers are still evicted with nowhere to go. This behaviour is still prevalent near the Hartebeespoort area and Skeerpoort.

For the farmworkers, domestics, security guards and others in this group who have for years been paid slave wages, the prescribed minimum wages give them an opportunity to help their families, especially the children, to escape poverty. These achievements notwithstanding, we are still seeing patterns of behaviour by certain employers that can only be understood in the context of a cold war against the transformation programme of the democratically elected government.

There is an increasing tendency on the part of certain farmers to victimise workers as a response to laws and regulations aimed at ensuring work and security for workers. For example, when the minimum wage law was passed we saw the dismissal of farmworkers and others in this category. For example, we in the North West are beginning to hear Grain South Africa argue that they are finding grain production unsustainable because of minimum wages for farmworkers. We still see the majority of farmers violating the Extension of Security of Tenure Act. Farmworkers are evicted with nowhere else to go. This situation is still prevalent in Ventersdorp, Lichtenburg and other strongholds of the Transvaal Agricultural Union.

The 2005 Budget focuses on key areas such as creating more job opportunities, fighting poverty and inequality, reducing levels of crime and extending basic services and infrastructure to marginalised communities, including the provision of decent housing and agricultural land. The future and historical growth rates in the economic services are above the average consolidated growth rate and reflect the emphasis placed on supporting for growth, mainly through increased infrastructure spending. The official growth rate of unemployment has decreased from 31,2% in March 2003 to 27,8% in March 2004.

The Labour Force Survey findings show that there has been a steady increase in employment across all sectors of the economy, broadly in line with the average rate of economic trade. South Africa faces a severe skills shortage but has a surplus of unskilled and semiskilled labour, hence the need for labour-intensive investments, which tend to create more jobs for unskilled and semiskilled workers. Allocations given to the Department of Agriculture for the Microagricultural Financing Scheme and to the Department of Trade and Industry for the Apex Fund, the tax treatment for small businesses, many of which are engaged in labour-intensive production and service activities, are some of the examples of policy measures by government to address this skewed supply of skilled and unskilled labour.

A lot of work and commitment from different sectors is still needed, so as to address skills shortages, for example Setas are still not supporting training enough and there are serious blockages in the system that need to be addressed. However, government budget allocations address this by real increases in education allocations over the MTEF, particularly the R1 billion for the recapitalisation of the FET colleges, the R776 million for the NSFAS and R6,9 billion to improve salaries of teachers.

In creating work and alleviating poverty so as to secure a better life for all, our government has embarked on a large-scale job creation project, which is the Expanded Public Works Programme. The EPWP and other initiatives such as the National Youth Service Programme have provided short-term employment. However, the challenge still remains to assist people in attaining permanent formal-sector employment.

The average increase in nominal remuneration in the formal sector moderated from 9,6% in 2002 to 8,7% in 2003 and 7,9% in the second quarter of 2004. One of these targets was for the EPWP to create, at least, work opportunities coupled with training within the first five years of the programme. To date good progress has been made towards meeting that target. In the first six months of the programme up to September 2004, at least R1,5 billion had been spent on implementation of 1 518 projects and to create 82 200 gross work opportunities.

The EPWP is well on its way to achieving a target of at least 130 000 work opportunities in its first year. As we are about to celebrate the first anniversary of the programme in April, the challenge is to ensure . . . [Interjections.]

In conclusion, we are honouring the Freedom Charter with this Budget. I thank you. [Time expired.][Applause.]

Mr H J BEKKER: Hon Chair, this time you don’t have to worry too much. I’m not going to have a fighting spirit. I will have another type of debate today.

At the first instance, I would like to congratulate the hon Joan Fubbs on what technically here in Parliament has been her maiden speech. But of course she comes from the Gauteng legislature. Well done, Joan!

However, with regard to the Freedom Charter there are so many good things in it. But one should also bear in mind that some of the aspects need clear revision, and it is today outdated. So, I think you can perform a valuable task in assisting the Minister to also address those aspects that are flying in the face of the hon Minister.

I must differ with my good friend, the hon Martin Stephens of the UDM with regard to his emphasis on company tax, particularly since these companies are the backbone and are really the income generators and job creation generators for South Africa, and we should do everything to encourage in this field certain of these aspects to come to the fore.

The hon Minister of Finance must be congratulated on a balanced Budget that particularly focuses on growth. The IFP has no hesitation in supporting this Budget, and we will vote for it. We have also known and recognised the hon Minister Manuel as a good juggler, and this time he made sure that his budgeting balls stayed in the air. [Laughter.]

I have previously said that the economic policy of the ANC is moving closer to the philosophy of the IFP, and I have encouraged them to continue to steal more and more of our economic policy. The more you steal the IFP ideas, the better it will be for our country. Should the hon Minister Manuel wish to join the IFP, he would be sincerely welcome, and I would gladly make a place for him and even nominate him for the position of President of South Africa. But please note, hon Minister: definitely not as President of the IFP.

Of course, the hon Minister also had a special windfall in having more than R11 billion of surplus monies from the South African Revenue Service available, even before he started dishing out his goodwill bonuses. This R11 billion was a result of improved controls at the South African Revenue Service, but also because of a substantial increase in value added tax, mostly resulting from the increase in the GDP of the country.

A proportionate increase of VAT in terms of the increase in growth rate and GDP is a clear monitor of taxation, good governance and effective tax recovery. Our success story with the increase in VAT is in sharp contrast with our neighbour Namibia where, despite substantial growth, VAT technically remained the same over the years. This is a clear indication that there is something drastically wrong with the revenue collection and controls of Namibia. I hope they will take a leaf from our revenue service and follow suit.

The IFP will support all efforts by the Minister to effect an increase and acceleration in economic growth. The IFP firmly believes in the principle of the multiplier effect, which is being created by major government projects. The massive upgrading of the Transnet infrastructure and the expansion projects of Eskom over the medium to long term will further stimulate the economy and result in continued growth.

Should the relative lower interest rates be maintained or even further decreased, this would further encourage local investors to invest in new enterprises and to expand their existing businesses. This, to me, is a prerogative before massive real foreign direct investment would flow to South Africa. We cannot expect foreigners to invest in our country when our own people are hesitant to invest.

Government should introduce a carrot and stick development strategy in order to encourage South African investors and entrepreneurs to establish more factories and thereby start an industrial revolution, rather than giving support to investors for the building of lucrative shopping centres. Shopping centres, to my mind, are just a recirculation of existing wealth, whereas with the industrial development comes the creation of new wealth, which we so desperately need.

If we just look at the iron ore situation - and we are grateful about the announcement of Transnet and Kumba with regard to the Saldanha-Sishen line

• isn’t there, with regard to beneficiation, the possibility that we can encourage China to actually set up factories at this particular point? Or isn’t there a possibility that we can at least try and melt up some of our iron ore, and even with pig iron - just to get pig iron out of the country? By that way of beneficiation, at least we can create thousands and thousands of jobs.

This brings me to the success also of the foreign exchange amnesty period during which South Africans could declare their illegal foreign investments and repatriate some of these investments. The so-called penalty of these amnesty transactions enabled the Minister to allocate billions of rands to special housing projects, whilst billions of rands flowed back into the country.

However, Mr Minister, the fact is that many people at the time did not trust the amnesty process or were just negligent in missing the deadlines. Furthermore, South Africa today is a much better and lucrative investment haven. The stability and improvement of the currency value of the rand makes it nonsensical for investors to keep their investments abroad. To me, South Africa is an investment haven and should be a priority for domestic as well as foreign investments.

We also support the Homecoming Campaign. Hon Minister, I’m confident that, should you grant a second amnesty period or window of opportunity, your expectations would be exceeded and even more foreign investments than previously would be repatriated.

But you also said no the first time I suggested the amnesty. And you introduced it. So thank you. Maybe we will see it in the future. I also feel sympathetic towards you, Minister, with regard to the fact that so soon after a splendid Budget the positive aspects of the Budget are doused by the tremendous spiralling of world crude oil prices. And you’ve got nothing to do with it, I know. But that has resulted in unheard-of petrol and diesel prices in South Africa. Fortunately, the favourable currency level of the rand against particularly the US dollar has softened the financial blow against South Africa. I still believe, however, that fuel prices in South Africa have increased unrealistically and progressively against the rand value.

The IFP fully supports the greater emphasis that you have placed on agriculture, and particularly assistance to small-scale farmers. The IFP have, over many years, proposed the development of small-scale sugar cane, maize and vegetable and fruit farming. We in the IFP term this our “Green Revolution”. And may the Green Revolution of the IFP live on! Viva the Green Revolution! Viva IFP! [Applause.]

Mr N M NENE: Chairperson, I would like to thank hon Bekker for suggesting a review of the Charter but this is done every five years and the voters always give it the go-ahead. As for the IFP’s economic policy, that still has to be seen. I don’t think you will be able to produce anything before the ANC, just like the establishment of your party itself. Regarding the amnesty, I am sure the hon Minister will talk to you outside this Chamber because I think you are speaking for yourself.

Once again, we are presented with an opportunity to debate what the Minister of Finance calls “the people’s Budget for a decade of hope and rising confidence of our people”. You rightly put in isiZulu: Thokola themba, amathunzi ayewukela. [Thokola, take heart, shadows are lifting.] Without any shadow of doubt, this is an expansionary Budget in real terms.

In the state of the nation address the President reminded us of our objectives that should guide our agenda as we move forward in this decade. Those objectives are the following: the first one is that of entrenching democracy; secondly, eradicating poverty through a growing first economy and a transformed second economy; thirdly, creating sustainable livelihoods; fourthly, securing the safety and security of all South Africans; fifthly, building an efficient democratic state that truly serves the people’s interests; and lastly, contributing to the African Renaissance and a better life for the peoples of Africa and the world.

A considerable amount of progress has been recorded in respect of the above and our people are beginning to reap the benefits of a stable economy in a democratic dispensation that was called for by the people’s congress in 1955, in Kliptown, when the people’s charter was drawn up. One of the clauses of this Freedom Charter proclaims that the people shall share in the country’s wealth.

Our mandate as the Joint Budget Committee in Parliament directs that, among other things, we consider that the allocations made in this appropriation are broadly in keeping with the government’s objectives. Indeed, the ANC’s commitment to the ideal of the Freedom Charter is abundantly demonstrated, especially in the following aspects: through the economy that has been growing impressively for the benefit of all, as opposed to the view that is always espoused by the DA of just 6%, without paying attention to the equitable distribution of these resources; over the years, social security has been rising as a percentage of government expenditure, and caters for the poorest of the poor; and the impressive economic growth recorded in the past years has also translated into a growing social wage for the vulnerable, which is currently at R956 per month for the poorest 40% of households, according to the latest study.

The first economy has accelerated as a result of a conducive economic environment, particularly the tertiary sector, which has recorded sustainable growth in fixed capital formation. Transformation of the second economy also is receiving attention in the form of broad-based black economic empowerment and incentives that seek to make it easier to enter the mainstream and promote emerging entrepreneurs through a preferential policy framework.

The announced exemption of small business from onerous bureaucracy and the relaxation of the tax threshold for small business will go a long way in levelling the economic landscape in favour of the small, medium and micro enterprises. It is also envisaged that the Small Enterprise Development Agency will be established soon to improve government support for small and medium enterprise development. Reducing the cost of doing business is key to promoting investment that is capable of creating employment opportunities. Steps have already been taken to liberalise telecommunications, and this should bring down the costs for consumers and the industry. It is also envisaged that by May 2005 the review of performance practices in state-owned enterprises will be finalised. Creating sustainable livelihoods through promotion of agriculture at subsistence and emerging levels, and graduating to commercial levels is also being accelerated.

The expansion of access to small and micro credit for the formerly excluded through the following instrument is also applauded: the agricultural credit scheme that has R1 billion capital for operation by May 2005. The provinces have also received R100 million to implement the farmer support programme. The Apex Fund, whose launch was delayed, is now operational. A Bill on co- operatives will also be submitted and will be serving before Parliament soon.

Let me highlight some of the main spending changes, although they have also been mentioned by most of the members here. Amongst those changes are: the additional R23,3 billion which is for the increase of social security grants and shows how the ANC cares for the vulnerable; R6 billion allocated to finalise land restitution, which is the transfer of physical assets to the poor; R5 billion to improve levels of remuneration and increase police numbers in order to promote effective policing; R6,9 billion for teachers’ salaries; R2 billion for the new housing strategy and R3 billion for related community infrastructure; R1,7 billion for water, sanitation and other municipal infrastructure; R3 billion for public transport investment and roads - partly related to the 2010 Soccer World Cup as well; R3,7 billion for the delivery of municipal services; R7,4 billion to step up education and health spending in provinces; R776 million more to the National Student Financial Aid Scheme, which opens the doors of learning for all; R1 billion to revitalise further education and training colleges in order to address the skills mismatch and hence structural unemployment; and R400 million to enhance the infrastructure of the public broadcaster, the SA Broadcasting Corporation.

What do all these spending changes mean to the ordinary man or woman in the remote rural area of Ntunjambili or Nkandla? They mean many things but to me they mean that there will be more social grants to the deserving beneficiaries.

Zizoletha amanzi ahlanzekile kuyo yonke imiphakathi yakithi; ukubuyiselwa kwemihlaba kubantu bakithi nokuthuthukiswa kwayo le mihlaba; amathuba okungena kwezohwebo njengabanikazi, hhayi njengezisebenzi njengoba bekwenzeka ngaphambilini; imigwaqo izokwakhiwa nakwandlwana imbala; ukuphepha okuzoqinisekiswa uma amaphoyisa andiswa nezimo zawo zokusebenza zibhekelwa; abasebenzi bakahulumeni abakhuthalele ukusiza abantu; ukwakhiwa kwamagumbi amaningi okufundela ukuze zonke izingane zifundele endlini; nosonkontileka abancane abazothuthuka bathole imisebenzi kumathenda kahulumeni.

Konke lokhu kudinga ukuba imiphakathi isukume ibambisane nohulumeni ukuze kufezeke, nekati lisuke eziko. Uthe-ke uNgqongqoshe uma eyisho le ndaba: Thokola themba, amathunzi ayewukela. (Translation of Zulu paragraphs follows.)

[That will provide for the provision of clean water to communities, the restitution of land to our people, the servicing of that land, the opening of ownership opportunities, and not having to work the land as workers, as was the case before. Roads will be built even in the poorest area. Security measures can be intensified if the numbers of police officers are increased and their conditions of service are taken care of. Public servants who are determined to serve the people will be employed. Adequate classrooms will be built so that all the pupils will learn in a home environment. The emerging contractors should be awarded tenders from the government tendering programmes.

In order to achieve all this, the communities should work together with the government, and this will also help to alleviate poverty. When the Minister spoke about this he said, ”Be consoled, the dream is about to come true”.]

The Joint Budget Committee is therefore satisfied that these allocations are broadly in keeping with government priorities and looks forward to a healthy engagement when departments engage with portfolio committees on their readiness to implement their programmes. Our main task from now on is to be vigilant in our oversight. We will no longer tolerate and accept the failure of departments to spend according to their strategic plans, and noncompliance with the Public Finance Management Act to the detriment of our service delivery to the people of South Africa.

We are encouraged by the government’s undertaking for a deliberate initiative to improve government’s capacity. To this end, the directors- general will submit to Cabinet a review of how government is functioning and proposals to increase government’s capacity to implement and mobilise the Public Service in order to speed up social transformation.

We are also pleased that local government will receive the same attention in terms of capacity through Project Consolidate, and this will assist 136 municipalities that are at risk to put their house in order. It’s also envisaged that the new Intergovernmental Relations Framework Bill will serve before Parliament in due course to promote better integration among the three spheres of government, and to align spatial development strategies and planning. We look forward to the completion of a plan for improved monitoring and evaluation across government by June, and its implementation will be phased in.

All these initiatives will not change our people’s lives unless we, as elected representatives, play our role both in Parliament and in our constituencies across party-political lines.

This Budget has been made possible because of the conscientious efforts of all South Africans over the past decade and puts the country on a sound footing to tackle the challenges we still face by effectively using the resources at our disposal. The ANC calls upon all South Africans, in whatever sector they may find themselves, to use this Budget as a basis for further building a people’s contract to create work and fight poverty. The ANC supports this Bill. [Applause.]

Mr C M LOWE: Thank you, Chairperson. The national Budget should be the most important job creation tool in government’s armoury, yet the glaring hole in this year’s Budget is that it fails to break the back of the chronic 40% unemployment crisis or adequately address the 500 000 skilled job vacancies that even Treasury concedes is one of the major constraints to economic growth and job creation.

The National Skills Authority and the Labour Minister boast that they have exceeded the five-year target to enrol more than 80 000 people in Seta learnerships, but it remains a drop in the ocean compared to the 8 million in the unemployment queue and the skills deficit of 500 000.

Research shows that as few as 14% of the 80 000-plus learners are actually completing their programmes, with even fewer finding jobs afterwards. Less than 30% of firms paying the skills levy actually had grants disbursed to them, and more than 80% of grants paid are to entities other than SMMEs.

So let us be frank: the Seta system has minimal potential to materially plug our skills gap. It costs R3,2 billion a year but it is unable to deliver the knockout blow to the skills crisis. Even if they did manage to spend their training budgets, Setas would still not reach the majority of would-be learners. Last year alone, they failed to spend nearly R750 million, yet this year’s Budget allocates them R4 billion more. That’s a lot of conferences and videotaping, even at Gallagher Estate rates. If the Setas can’t or won’t spend the money, then you need to be able to step in and do it for them, Minister, and that means amending the Skills Development Act, which currently ties the Skills Development Levy solely to the Setas.

The Democratic Alliance will shortly table a Private Member’s Bill to change this, and free up funding for targeted skills training initiatives. What we need is a budget that provides incentives for job creation and skills development, rather than penalties for not carrying these out; a budget that delivers tax breaks to companies and individual households that encourages them to create permanent employment, and targeted interventions that grow our skills base through effective education and training, and bursary opportunity voucher programmes as incentives for employers to shoulder the burden.

Scrap the Seta system in favour of an opportunity voucher and tax rebate system that enhances skills development, encourages businesses to employ more labour, and assists young people to obtain work experience and training, start more small businesses or further their studies by reducing the cost of any one of these options. Combined with the tax deduction of 150% of the first R2000 per month of every new employee’s salary, this will create an environment where business are encouraged not only to employ more workers, but to train and develop them to meet the future skills needs of the business. Backed by the labour law reform for SMMEs promised by President Mbeki but subsequently refuted by the Minister of Labour, this is the way to solve our skills and unemployment crisis.

Labour and Education also need to resolve their turf war over the National Qualifications Framework, which is now three years overdue. The R22 billion allocated to skills development via the Setas and NSF over the next five years will be largely wasted unless the skills opportunity net is substantially widened and statutory amendments are made to relax the dedication linkage between Setas and the Skills Development Levy.

Holding multimillion rand conferences at Gallagher Estate might make the front pages of the national media, but it does little to help get South Africa skilled and working. This Budget does achieve much, but where it matters most, to the unskilled and unemployed, it fails to offer the kind of solutions and hope that it so easily could do.

In conclusion, I want to respond to the hon Rob Davies’ ridiculous allegations. If he took the trouble to remove his blinkers for a second to read about the DA’s other tax initiatives, which include R2,3 billion worth of direct tax cuts designed to encourage employment, R2,4 billion to stimulate investment, and R1 billion to promote tertiary education and fight crime, I think he’d sing another tune. I thank you. [Applause.]

Mrs D G NHLENGETHWA: Deputy Chairperson, various Premiers, hon members, comrades, I just want to respond, firstly, to the member of Parliament who was here. I want to respond by saying that the Setas are here to stay. If your youth, your women or your target groups in your party are highly skilled, ours are not skilled the way we want them to be. [Applause.] So the Setas are here to stay.

Njengobe nyalo sesingena esigabeni sesibili seminyaka lelishumi satfola inkhululeko, inkhulumo yami yalamuhla itawuhlonipha bonkhe bomake emhlabeni wonkhe jikelele. Mhlazane tingu 8 kuMashi 1975 emave amhlabuhlangene avumelana nga ngelethu, kutsi lelilanga kube lilanga lekuhlonipha umzabalazo wekukhululeka kwabomake emhlabeni wonkhe, loku lokutsiwa pheceleti International Women’s Day. Ngitawuphindza futsi ngihloniphe bomake bekucala lababa bavukuti bangena ematfunjini emhlaba bawuvukuta [women miners]. (Translation of siSwati paragraph follows.)

[As we enter this second phase of our 10 years of freedom, my speech is going to honour all the women of the world. On 8 March 1975 the UN agreed that this day be the day to celebrate the struggle of women’s liberation throughout the world, which is called International Women’s Day. I will also honour the first women who went into the bowels of the earth and involved themselves in mining.]

These are women who started in companies that dealt with our roads and in areas that were regarded as male dominated. I refer here to women-dominated companies, such as the South African Women in Construction, or SAWIC, and the South African Women in Mining Association, or SAWIMA, which are contributing in building economic growth for women, in particular our rural women.

Somlomo, singu ANC siyevelana kakhulu netihlobo nebangani labashiywe bobabe labangubona bebondla emakhaya abo kulenhlekelele lenkhulu kangaka leyentekile yekudzilika kwemigodzi kuletimayini letimbili. Ngiphindze futsi ngihloniphe bafelokati bemaphoyisa netintsandzane, bafelokati labasele dzengwane emvakwetimphi temibango, bafelokati netintsandzane labaswele batali ngenca yetingoti temigwaco, bafelokati netintsandzane labafelwa ngulabatsandzekako babo ngekuhlaselwa ligciwane lengculaza, ngibuye ngihloniphe nalabakhubatekile kanye nalabadzala. Ngiko nje ngetfula lenkhulumo yami ngiyicondzanisa nekuhlonipha bona ngobe bonkhe batindlalifa takulebhajethi.

Somlomo, kusukela kudzala bomake ngibo lababesembili ekuwagcineni nasekwabeni emafa emindeni yabo. Ngibo lababeneligalelo ekwabeni emaphakelo etimali emasontfweni nakubomasingcwabane. (Translation of siSwati paragraphs follows.)

[Madam Speaker, as the ANC we sympathise with the relatives and friends who have lost fathers, their breadwinners, in the disaster when these two mines collapsed. Let me also honour the widows who were left destitute due to faction fights, the orphans who lost their parents due to road accidents, the widows and orphans who lost their loved ones due to HIV/Aids, and the disabled and elderly people.

The reason I deliver my speech in their honour is because all of them are beneficiaries of this Budget. Madam Speaker, women have always been responsible for securing and distributing their families’ wealth. They are also responsible for allocating the budgets of churches and burial societies.]

We, as women, can be able to feed and provide for the basic needs of our people and give shelter to the total population of South Africa, which is 46,6 million, through the ANC policies and programmes guided by the Freedom Charter. I just want to define the word “mother”: M stands for manager; a mother is a manager at home. O stands for organiser; a mother is an organiser in her home. T stands for teacher; a mother is a teacher. H stands for healer; a mother is a healer. E stands for engine; a mother can give warmth to every family member. R stands for rescuer. [Applause.]

Let us drink from the fountain of mountain water as contained in the Freedom Charter: There shall be houses, security and comfort; the aged, orphans, disabled and the sick shall be cared for; every person shall have a right to leisure, rest and recreation; fenced locations and racial ghettos shall be abolished; laws which result in breaking up families shall be repealed.

Yasebela-ke I-ANC yakucedza konkhe loko. Emahostela nyalo sekwaba tindlu tekuhlala imindeni. [The ANC responded and eradicated all that. Hostels are now family units.]

We came up with the following legislation guided by the vision enshrined in the Freedom Charter. We put in place legislation such as the Housing Act of 1997, the prevention of illegal eviction Act, the land Act of 1998, the Housing Consumers Protection Measures Act of 1998, the Rental Housing Act, the Home Loan and Mortgage Disclosure Act of 2000, and the Disestablishment of South African Housing Trust Limited Act of 2002. However, in 10 years of democracy 1,74 million new housing units have been built for households with an income of less than R3 500 per month. In addition, 2,6 million more subsidies were approved to benefit more than 6,6 million people.

Simvile-ke umhlonishwa, Indvuna Yetetindlu, itolo nakamemetela kutsi imali yekusita ngema-subsidi etindlu ikhushuliwe ngeti R3 000, lokusho kutsi nyalo seyitaba ti R31 900. [Yesterday, we heard the hon Minister of Housing announce that the housing subsidy has been increased by R3000, which means that it will now be R31 900.]

To date, the total cost of housing delivery is R2,76 million. There is also an additional R43 billion of national rates revenue added to the provincial budgets. One of its functions is to speed up the process of building houses, although additional resources allocated to social programmes targeting the poor and the vulnerable, improvements in the quality of spending, especially in the area of housing and social security, are essential. An amount of R2 billion is added to housing subsidy programmes to support the implementation of the new strategy, which is aimed at upgrading informal settlements to accelerate the pace of housing delivery. Even though housing shortages exist across the country, migration to the cities places a severe strain in the urban landscape.

Ukhulumile-ke Make Mmathulare Coleman, MEC Wetetimali eMpumalanga. Eluhlelweni lwakhe lwekwabiwa kwetimali, utibeke embili temphilo, netibonelo tetindvodla, kanye netemfundvo. Ucaphunile-ke futsi kulesamba semali lenganga R15,075 billion layabelwe yiNdvuna Manuel - siyabonga babe. Ushito-ke nekutsi ikhuphuke nga 9% nawucatsanisa nesabelo semnyakatimali lophelile wabuye wengeta nangekutsi kulesikhwama sakhe ubeke eceleni imali lenganga R20 million yekucedza nya luhlelo lwekutfutfwa kwendle ngemabhakede. Loko ukushito nakaphendvula simemetelo salomdzala, Ndvunankhulu waseMpumalanga, longangababe Thabang Makwetla naketfula inkhulumo yakhe yesifundza [the state of the province address] asho kutsi ngaMashi utabe asakucedzile kutfutfwa kwendle ngemabhakede.

Uphindze washo-ke umhlonishwa Make Coleman wacaphuna inkhulumo Yandvunankulu watsi:

In order to promote the sustainability of municipalities and integrated housing and human resettlement development, the provincial department of local government and housing will receive a total amount of R489,765 million.

Sibabonile-ke, Somlomo, bosomashishini labancane kutsi baye bahlomula noko kuloluhlelo kutsi kucaliswe luhlelo lwekusungulwa kwema-Software House International, nelubambiswano lwekwakhiwa kwetindlu tekuhlala. Bomake bangenile babhaka tinkhwa. Sibabonile kubomabonakudze. Siyababona bayatakha tindlu, lokusho kutsi sesitayibhodla indlala. Empumalanga-ke kunetinkampani letincane letisahluma, letinye tato nguleti letilandzelako. (Translation of siSwati paragraphs follows.)

[The hon MEC for finance in Mpumalanga, Madam Mmathulare Coleman, has spoken. On her appropriation programme she has prioritised health and education with outstanding funds. She withdrew a certain amount from the R15,075 billion that was allocated to her by the hon Minister Manuel. We thank you, sir. She also mentioned that the budget has increased by 9% when compared to last year’s budget and he also set aside R20 million for the complete eradication of the bucket system. She said this when replying to the hon Premier of Mpumalanga, Thabang Makwetla’s provincial address. She stated that in March the total eradication of the bucket system would be complete.

The hon MEC Coleman has again extracted from the hon Premier’s speech and said:

In order to promote the sustainability of municipalities and integrated housing and human resettlement development, the provincial department of local government and housing will receive a total amount of R489,765 million. We have seen, hon Speaker, small entrepreneurs who have benefited from this programme of establishing Software House International, and the partnership of building domestic houses. Women have also engaged themselves in bread making. We see them building houses, which means we are going to eradicate poverty. In Mpumalanga there are small companies, which are still developing, some of which are the following.]

There is the Greater Middleburg Housing Association, which has 501 units; the Imbombela East Housing Association envisages developing 500 units; the Highveld East Housing Association envisages developing 500 units; and the Emalahleni Housing Institute which has their own technical team in place, and their first phase will start soon.

Bajabulile-ke bantfu labadzala kutsi, emvakweminyaka leminyenti etimphilweni tabo, babe netikhiya nje tetindlu letitabo matfupha. Bayasho nangemilomo yabo kutsi bangeke baze bayibone lenye inhlangano letabentela lokuhle kangaka. Bajabula badzimate bakhale, kube buhlungu kubona bantfu labadzala bakhala tinyembeti tenjabulo, badzimate basho batsi nome sengingafa, ngitawufa ngishiye batukulu bami basendlini. [Tandla.]

Loku-ke yinhlanhla lelivela kancane kubalingani bami labangala, futsi kusibusiso kutsi umuntfu lomdzala akunike sibusiso. Basinikile-ke tsine njenge ANC sekutsi siyawubusa kudzimate kubuye Jesu. Loku kungobe sibanike emandla elutsandvo. Vumelana nami-ke Mfundisi Meshoe, nome ungekho lapha kodvwa ngiyakholwa uyangibona lapho ekhaya kutsi letindlu lesikhuluma ngato, lesitinika bantfu labadzala labangazange etimphilweni tabo sebahlonishwe njengebantfu, ngekunikwa tindlu, kwekutsi ngito letindlu lesitatitfola naseZulwini lekukhulunywa ngato nakutsiwa “Ekhaya lababe kunetindlu letinyenti”. [Luhleko.] (Translation of siSwati paragraphs follows.)

[The elderly are therefore happy that after so many years they have keys to their own houses. They even said that they would never see another party that will do such a beautiful thing for them. They are so happy that they even cried. It was painful to see old people crying tears of joy.

They even said that if they die, they would die leaving their grandchildren in a house. Home sweet home. [Applause.] This is something that occurs seldom to my colleagues on the other side. It is a blessing to be given. It is a blessing to be blessed by an elderly person. We, as the ANC, have been given a blessing to rule till Jesus comes back. This is because we have given them the power of love. Agree with me, Rev Meshoe, though you are not here but I believe you can see me there at home. And that is the house we are talking about, that we are giving to the elderly people who have never in their lives been respected as human beings, by being given houses that we will get in heaven, when it is said “in my fathers house there are many rooms”. [Laughter.]] In conclusion, we encourage people – black and white – to live by the vision of the Freedom Charter with an emphasis on fighting poverty, unemployment and underdevelopment. We are also encouraging possibilities for greater hope for our people. Acting together, we do have the capacity to realise these objectives, and sparing neither effort nor strength we can and shall all build a South Africa that truly belongs to all who live in it – black and white united in diversity.

Ushito-ke lomdzala longangaMengameli. Njengobe ngisenemizuzu lemibili, ngisafuna kwenta nasi sibonelo. Nawucindzetela umuntfu, njengalokwekutsi ulwa nebuphuya, umcindzetele umuntfu umfutsetelanise angasakhoni nekuphefumula, mzukwana atfola imbotjana nje lencane atsi uyaphefumula atfole umoya – tsine bantfu labamnyama labakwatiko kucindzetelwa – akatsi nakavuka lapho bese ushaya sibhakela kodvwa uvuka ajampe aye etulu njengebhola yentenetja nawuyigcumisa phansi. Ubhampa aye etulu, nakabuya lapho umtfole aseme la asaphetse umbuso. Sihleti lapha. Sitawutsatsa lombuso nome nasicindzetela kangakanani. [Tandla.] Nanisitjela kutsi niyasicindzetela kantsi niyasibhampisa njengebhola yentenentja sagcuma saya etulu nasibuya lapho satsatsa umbuso sabuya nawo la phansi sakhulula bantfu labamnyama. Ngiyabonga. Tandla.

[The hon President has spoken. Now that I am left with two minutes, I would like to give this example. If you oppress a person by saying that you are fighting poverty, and you oppress that person by making him suffocate, the day he gets a small hole and manages to breath – we black people know oppression – he does not just wake up and fight you but will jump sky high like a tennis ball when it is bounced. He jumps sky high, and when he falls down he will be in power. We are here to stay. We will rule this government regardless of how long you oppressed us. [Applause.] You told yourselves that you were oppressing us whilst you made us jump sky high like a tennis ball and when we came back we took power, and freed the black nation. I thank you. [Applause.]]

Dr S M VAN DYK: Voorsitter, indien ons kyk na die vier ekonomiese mikpunte van die regering, naamlik prysstabiliteit, betalingsbalansewewig, volle indiensneming en ‘n hoë groeikoers, dan het die regering geslaag wat die eerste twee aanbetref, want ons het ‘n lae inflasiekoers en ‘n surplus op die betalingsbalans. Wat die laaste twee aanbetref, het die regering gefaal, want sedert 1995 het werkloosheid met 88% gestyg, én is 40% van die arbeidsmag tans werkloos.

Maar, die Minister van Finansies sê dis nie waar nie, want anders sou ‘n twee-derde meerderheid nie vir die regering gestem het nie. Meneer, die mense het vir politieke vryheid gestem, nie vir ekonomiese vryheid nie. As die mense van dié land vir ekonomiese vryheid stem, sou die ANC so min stemme gekry het dat u dalk vandag nie eens in die Parlement sou gewees nie. Die ekonomiese groeikoers is laag vanweë die ANC se magshonger om baas te wees oor die ekonomie. Die ekonomie ken nie grense nie en die ekonomie wil ook nie hê daar moet met hom ingemeng word nie. Die besigheidsektor is daar om wins te maak, en hy laat hom lei deur vraag en aanbod in die ekonomie. Hy laat hom nie lei deur ‘n oorbehepte regering of ‘n ongedissiplineerde arbeidsmag nie, want dít is die twee faktore wat tans ons ekonomie teister.

Minister Manuel, en dit geld ook vir die ander Ministers, enige politieke wenslikheid hang van die ekonomiese moontlikheid af. Om die regering se beleid te implementeer kos geld, maar as die ekonomie dit nie toelaat nie dan beperk dit u bestuursraamwerk. Daarom moet ons die ekonomie uitbrei, en al hoe ons dit kan doen, is deur ekonomiese ontwikkeling of om die maatskaplike opheffing van ons mense daar te stel.

Deur bogenoemde te doen sal gelykheid, herverdeling en hervorming dan outomaties ook deur die ekonomie bevorder word. Gelykheid, herverdeling en hervorming kan nie bloot onbepaald polities, administratief en kunsmatig ingestel en gehandhaaf word nie. Wat die maatskaplike ontwikkeling dan aanbetref, moet ons kyk na die gesondheidsbevordering van al ons mense. Ons moet kyk na die basiese munisipale dienste van al ons mense. Ons moet kyk na die verbetering van onderwys en opleiding . . . [Tussenwerpsels.] (Translation of Afrikaans paragraphs follows.)

[Dr S M VAN DYK: Chairperson, when we look at the four economic goals of the government, namely price stability, balance of payment, full employment and a high growth rate, we will see that the government has succeeded with the first two, as we have a low inflation rate and a surplus on the balance of payment. The government has failed with regard to the last two, since unemployment has increased by 88% since 1995, and 40% of the labour force is currently unemployed.

But the Minister of Finance says this is not true, otherwise a two-thirds majority would not have voted for the government. Sir, the people voted for political freedom, not economic freedom. If the people of this country voted for economic freedom, the ANC would have received so few votes that you would possibly not even have been here in Parliament today.

The economic growth rate is low as a result of the ANC’s yearning for power to rule the economy. The economy knows no boundaries and the economy also does not want to be interfered with. The business sector is there to make a profit, and is led by demand and supply in the economy. It does not allow itself to be guided by an obsessed government or an undisciplined labour force, as these are the two factors that are currently devastating our economy.

Minister Manuel, and this also applies to the other Ministers, any political desirability depends on its economic possibilities. It costs money to implement the government’s policy, but if the economy does not allow it, it restricts your managerial framework. We therefore have to expand the economy and the only way in which we can accomplish this is by economic development or by achieving the social upliftment of the people.

By doing the above-mentioned, equality, redistribution and transformation will automatically be promoted by the economy. Equality, redistribution and transformation cannot be established and maintained on a political, administrative and artificial level indefinitely. Where social development is concerned, we have to look at the promotion of the health of all our people. We have to see to the basic municipal services of all our people. We have to look at the improvement of education and training . . . [Interjections.]]

The HOUSE CHAIRPERSON (Mr N P Nhleko): Order! Order, hon member, could you just take your seat. Are you rising on a point of order, sir?

Mr N J GOGOTYA: May we take off our jackets, please? There’s so much hot air coming from the speaker at the podium, may we take off our jackets?

The HOUSE CHAIRPERSON (Mr N P Nhleko): That is not a point of order, sir. [Laughter.] Please continue.

Dr S M VAN DYK: Ons moet kyk na die verbetering van die onderwys en die opleiding van ons arbeidsmag, asook die daadwerklike bekamping van misdaad en die uitroei van korrupsie. Ons pleit dat die Begroting oor die mediumtermyn sal konsentreer op die maatskaplike opheffing van ons mense, sodat ons ‘n gesonde, welvarende, gedissiplineerde en ‘n gespesialiseerde arbeidsmag tot stand kan bring.

Wat die ekonomiese ontwikkeling aanbetref, moet ons besef dat aan die vraagkant ‘n bestendige monetêre en fiskale beleid nié die ekonomie alleen sal red nie. Ons moet ook kyk na die aanbodkant, die opheffing van die maatskaplike welstand van ons mense, en ekonomiese ontwikkeling, en dán praat ons van deregulering.

Om jou produktiwiteit te verhoog, gaan jy onder andere jou tegnologie verander, en dit is presies wat 30 jaar gelede gebeur het met die koms van vakbonde, arbeidswetgewing, maatreëls en kwota’s. Die ondernemings het oorgeskakel van arbeidsintensiwiteit na kapitaalintensiwiteit. En dít gaan vandag nog aan, want ons sit met ‘n baie sterk rand, lae inflasie en ‘n lae rentekoers.

Meneer Manuel, dit is hoe die ekonomie werk, maar dan bly die regering inmeng in die ekonomie en dit is hoekom die sakeondernemings nie meer arbeid in diens neem nie. (Translation of Afrikaans paragraphs follows.)

[Dr S M VAN DYK: We have to look at the improvement of the education and training of our labour force, as well as the active combating of crime and the eradication of corruption. Our plea is that the Budget, in the medium term, should concentrate on the social upliftment of our people, in order for us to establish a healthy, prosperous, disciplined and specialised labour force.

As far as economic development is concerned, we have to realise that on the demand side, a stable monetary and fiscal policy will not be sufficient to save the economy. We also have to look at the supply side, the upliftment of the social welfare of our people, as well as economic development, and only then can we talk about deregulation.

To increase your productivity you have, amongst other things, to change your technology, and that is exactly what happened 30 years ago with the arrival of trade unions, labour legislation, measures and quotas. The businesses have made a switch from labour intensity to capital intensity. And it is still carrying on today, as we have a very strong rand, a low inflation rate and a low interest rate at the moment.

Mr Manuel, this is how the economy works, but then government keeps interfering with the economy and that is why the businesses do not employ labour forces anymore.]

If the government keeps on doing what it has been doing, it will be getting what it has been getting.

En daarom moet ons ophou om met die ekonomie in te meng.

Wat die regering behoort te doen, is om die klein-, medium- en mikro- sakeondernemings, ongeag ‘n omsetplafon, los te maak van sekere belastingsheffings en sekere arbeidswetgewing. Wat nodig is, is die deregulering van die besigheidsektor tot ‘n absolute nodige minimumvlak, gepaardgaande met strukturele aanpassings om van die diskresie van onnodige burokratiese instellings ontslae te raak.

Dan sal klein sakeondernemings groei, buitelandse belegging sal toeneem, en ons sal ook kan slaag om die 46% alleenlik swart werkloosheid aan te spreek, wat niks anders is as ‘n vorm van swart ekonomiese bemagtiging nie.

Verlede jaar het mnr Tony Leon gevra vir 150 000 polisiebeamptes op straat, en die President het dit verlede jaar in werking gestel. Mnr Tony Leon het gevra vir deregulering, en vanjaar het die President ook dít in werking begin stel. Nou het die DA ‘n alternatiewe begroting daargestel en nou vra ons die Minister van Finansies om net soos die President te luister na die DA, sodat die DA ‘n bydrae kan lewer om die ekonomie van dié land te red. [Tussenwerpsels.] Ek sê vir u dankie, Voorsitter. [Applous.] (Translation of Afrikaans paragraphs follows.) [And that is why we have to stop interfering with the economy.

What the government should do is to release the small, medium and micro businesses from certain tax levies and some labour laws - irrespective of a turnover ceiling. What is needed is the deregulation of the business sector to an absolutely necessary minimum level, along with structural changes to get rid of the discretion of any unnecessary bureaucratic institutions.

Then small enterprises will grow, foreign investment will increase, and we will also be able to address the 46% black-only unemployment rate, which is nothing more than a type of black economic empowerment.

Last year Mr Tony Leon asked for 150 000 police officers to be deployed on the street, and the President put this into operation last year. Mr Tony Leon asked for deregulation last year and this year the President also started putting this into operation. The DA has now also released an alternative budget and now we ask the Minister of Finance to listen to the DA just like the President did, so that the DA can make a contribution to save the economy of this country. [Interjections.] I thank you, Chairperson. [Applause.]]

Mr K A MOLOTO: Thank you, Chairperson. Indeed we have listened to the DA’s alternative budget. Let me state from the outset that if the hon Lowe removes his blinkers and examines the voucher system of the DA closely - examine the figures very closely - the R800 million per year that you are proposing will not be sufficient for the training needs of the unemployed in this country. It is just peanuts; a populist gesture - it is a con.

We have always characterised the unemployment situation in South Africa to be of a structural nature. Therefore regular and mindless tax cuts will not alleviate this situation. The hon Nkem-Abonta takes a very narrow approach to the challenges faced by SMMEs. The issue of access to capital is key to the success of most SMMEs in this country. The majority of black people in this country know the challenges that they face when they try to access capital.

Therefore his views are foreign to most SMMEs in this country. He is advancing a nonexistent debate on entrepreneurial spirit in the country. But I want to state very clearly that entrepreneurship will only thrive where there is a broad base of skilled people, hence the need for skills development in South Africa. We need to take an eclectic approach, which is the same approach that has been adopted by government.

Allow me to provide a penetrating critique to the DA’s views and the so- called alternative budget and restate the correctness of the ANC’s policies as expressed through the Budget tabled by the Minister. [Interjections.} I’ll come to you.

The hon Dr Rabie talked about the lower-income groups being affected by capital gains tax. I wonder which lower-income groups he is talking about, because capital gains tax applies only to primary residences. Let him show me any lower-income group person who owns more than two or three houses - it really baffles me.

The DA’s alternative budget for 2004, amongst other things calls for the abolition of capital gains tax. When this House adopted the Taxation Laws Amendment Bill in 2000, it did so guided by certain principles of fairness, equality and the need to close tax avoidance measures that undermine these principles. Therefore, it is important to restate these principles.

Our tax system calls for those who are rich to pay more tax than the poor. It calls for those who have equal capacity to pay the same amount of tax and calls for those with greater capacity to pay more tax.

The ANC has argued correctly, during the passing of the Bill, that there is a possibility of the wealthy in society converting their income into capital gain and easily avoiding taxes on such income. Those who own shares in the stock exchange could avoid being taxed on the increases in value of their shares by simply insisting that it was a capital gain. The point remains that their wealth has increased, while an ordinary income earner will pay tax in full.

Such tax avoidance measures by the wealthy would have compromised the principle of equality and fairness. The abolition of capital gains tax will lead to a distortion in the allocation of resources and investment decisions. Obviously this will have undesirable consequences for the South African economy.

This special pleading by the DA, on behalf of the rich, to scrap taxes on income has disastrous consequences for this country. Serious economic thinkers maintain that the abolition of capital gains tax will increase tax revenue in the short term, but then increase the long term debt of government. The short-term mentality of the DA is harmful to the long-term economic prosperity of the country.

The DA is promising numerous tax rebates and deductions, which are totally misguided and incoherent. Again, if one examines the DA’s proposals on a lot of issues, it becomes apparent that they are purely populist gestures.

Really, why on earth does the DA propose a R2000 tax deduction per month for people who employ domestic workers and helpers? That amounts to a tax deduction of R24 000 per annum per household. All the DA needs to do is to join hands with the Minister of Labour to encourage people to pay their domestic workers decent wages.

The DA’s flirtation with crazy tax ideas is a cause for concern. How is the DA going to finance some of the critical capital expenditure that is needed for economic and social development? [Interjections.]

This reminds me of the critique of the Brookings Institution in the US. They provided this critique on President Bush’s budget proposal on tax cuts for the wealthy - for the wealthy, mind you. I found their statement quite informative. [Interjections.] Go and read your document, go and read your document carefully. Let me quote the statement. They are saying that:

Paying for the tax cuts would require monumental reductions in spending or increases in other taxes. To offset the revenue losses in 2014 would require, for example, a 48% cut in Medicare benefits, or a 117% increase in corporate taxes.

Standing here, I am asking myself: What would the DA do if they realised that the budget deficit was ballooning beyond control, as a result of their mindless tax proposal? There is a simple answer to this. They would simply drop the Basic Income Grant proposal, reduce social security grants and bring into the tax net people earning below R35 000. They will increase VAT from 14% to possibly 20%.

The ANC government calls for tax relief on small businesses to stimulate growth and encourage their role in the economy. A graduated tax rate structure is being proposed which will also include a depreciation allowance.

The DA proposal reminds me of the critique of Herbert Stein, a former Chairman of the President’s Council of Economic Advisers from 1972–1974. He had this to say after analysing the budget of President Reagan. He indicated that the Reagan administration’s reckless and mindless tax cuts, similar to those proposed by the DA, would only reduce economic tax and therefore be very dangerous or harmful to the economic growth of the country.

Allow me to tend to another controversial issue raised by the DA in their alternative budget. The DA calls for the introduction of a sunset clause to the Employment Equity Act. Let me just read the preamble of the Employment Equity Act. Let me quote:

Recognising that as a result of apartheid and other discriminatory laws and practices there are disparities in employment, occupation and income within the national labour market; and that those disparities create such pronounced disadvantages for certain categories of people that they can not be redressed by simply repealing discriminatory laws . . .

I also ask myself: What is the difference between the DA and the whites- only trade union, Solidarity? The answer is: It is just a bunch of right- wingers, united by a common hatred of transformation and opportunities created for the previously disadvantaged.

The DA cause is calling for the privatisation of the Land Bank, the DPSA and the IDC, amongst others. [Interjections.] No, no I’ll come to you. The DA wants to create a minimalist state, which cannot make an intervention in addressing the inequalities of the past and encouraging state-led economic growth in depressed areas.

These institutions are critical to the development agenda of this government and therefore they should be encouraged. Really, the DA’s proposal is a nonsensical product of conceptual confusion. The Land Bank and the Post Bank are going to play a critical role in reaching out to emerging farmers and beneficiaries of land reform.

Emerging farmers and beneficiaries of land reform require finance to buy fertilisers, equipment and basic infrastructure to engage in meaningful, productive activities. They need better access to roads to take their produce to markets. They require water schemes and electricity. They require better information about current technology and markets and recent information from research laboratories. All this requires money and not endless tax loopholes, as proposed by the DA.

Institutions offering micro-finance are critical to rural development. Therefore, we are encouraged by the announcement of the Minister to allocate R1 billion to the new Microagricultural Finance scheme to be announced later by the Minister for Agriculture and Land Affairs. Thank you.

The MINISTER OF FINANCE: Thank you very much, Chairperson. Let me express my sincere appreciation to both the Portfolio Committee on Finance and the Joint Budget Committee. I followed with keen interest the debate and the number of opinions and I’d also like to express my appreciation to all the contributors here. I’ll deal in a moment with the value of some of those contributions.

After the Budget, an academic advised me that the number 17 has a relation to the Budget. That is the number of times that we used the word “decade” in the speech. It is a very important observation because the key issue about this Budget is the basis that it lays for the kind of South Africa we want for tomorrow, and specifically the kind of South Africa we want in 2014.

The Budget has been well received across the country. The broad objectives that we have set for growth and for advancing the wellbeing of all South Africans and for narrowing the divide between rich and poor in South Africa are in evidence in the policy choices. It is also very important that we go back to the Constitution. It is not a Constitution that is respected by all parties in this House, but right in the preamble to the Constitution we are entreated to improve the quality of life of all citizens and free the potential of each person. So that commitment to all South Africans is not an optional extra. It is not something you bolt on. It is something fundamental to what we must do every day of our lives, in government and in Parliament in the kind of oversight we seek to have over all citizens in this country. If you want to meet that constitutional objective, then clearly you can’t stand back and hope that the market will deliver this alone. The market fundamentalists are clearly at odds with the letter and spirit of the Constitution as well. What it requires is an effective state and that effective state has to have a developmental content.

Regardless of what you have read somewhere, hon Davidson, a developmental state places the lives of its people and its Constitution at the epicentre and works to deliver change to improve on the quality of life. That is not an optional extra mandate. [Applause.]

Let me deal with some of the more controversial issues raised. The hon Davidson makes a special appeal for an effective rate. Let me say again: The corporate tax rate in South Africa is 29%. There is no such thing as an effective rate that is different. Every country that you mentioned, hon Davidson, has a dividend tax, which is imposted at the marginal rate. There is one exception and that is India. The minister of finance introduced the Budget on 28 February and there he introduced something which is called a withholding tax on dividends distributed at 12,5% of the dividends to be distributed. It looks like a secondary tax on companies; it walks like one; it feels like one – it only exists by a different name. With regard to all these pleadings by KPMG and everybody else to ignore the secondary tax on companies, the only other thing you can do is to tax it as a dividend at 40% in the hands of the recipient. But that tax on the rich will remain in South Africa. It is a tax on distributed income and it won’t disappear for as long as the ANC is government. Of that I give you the assurance.

Let me turn to the way in which you put your arguments and I want you to listen to me, hon Davidson. What you are saying is: Give a tax incentive to people to employ others at home. What you’re looking for is a colonial mindset. You want to be waited on hand and foot by black people who will carry and fetch, and the more you employ the more the state will subsidise that lifestyle. We will not do it for you in our democracy. [Applause.]

Similarly, your arguments in respect of training and the importation of skills basically say that we should not train South Africans but import skills from elsewhere. That is the gist of your argument. It is an antidemocratic argument in South Africa. You should listen to yourself, hon Davidson. [Interjections.] At the end of the day, what I have not been able to understand is what these people are doing in the House. They don’t believe we need a government at all. They clearly can’t believe that we need a parliament at all. For them it is only sheltered employment because it is antithetical to every argument I’ve heard out of this side of the House this afternoon. [Applause.]

Let me move on to the hon Vezi, who is not in the House now. The hon Vezi, amongst other things, said government must encourage labour- intensive investment. Nobody discourages that. What you need to understand is what is happening in the world right now. Every developing country and every developed country in the world has exactly the same problem: All jobs are going to China. This applies even to these employers who get up and plead - I heard the hon Nkem-Abonta on this issue the other day - and need their government all of a sudden. Take that particular company for instance: If you go into their stores around the country, then 60% of what it is on their shelves is imported from China. They are destroying jobs. The same company that is pleading for special intervention from government now is a major importer of clothing from China. So we have to listen to those who cry wolf and deal with these issues quite differently. Also, I want to say to the hon Vezi that the Deputy Speaker did pass to me his teacher’s story.

I’d like to deal with the issue of social grants, which was raised by the hon Stephens, Greyling and Rajbally. The first point I’d like to make is that the increases have exceeded inflation: For the aged, 5,4% and on child support grants, 5,9%. This exceeds the official measure of inflation. You may not like it, but that is the official measure of inflation. It is also important to recognise that 10,1 million South Africans now benefit from social grants. [Applause.] The rate of growth in one direction will always put a brake on the rate of growth in the other direction. You’ve got to see this as part of a single whole. Social grants now account for R72,7 billion of our Budget, or 19% of our noninterest expenditure. It cannot grow any faster. You can only grow it faster if you sacrifice something else with regard to what government does and that is the choice. Budgeting is about choices and what the electorate does is to put us here to exercise those choices on their behalf. We have to choose wisely. We have to choose for tomorrow and the reason we cannot grow it any faster is those constraints that exist in reality in this economy.

Let me turn to the hon Durr. You see I don’t understand what this demotivating race debate is that he is talking about. They are the realities of South Africa that we have to deal with. There is a past that still lives in South Africa today and unless we understand that we’ll pay a heavy price going forward. So we need honesty about the nature of the challenge and we must be able to deal with it. Also, in respect of property, if you take all of Cape Town and you add in Khayelitsha, Mitchells Plain and Manenberg and Hanover Park, then you can say foreigners own less than 1% of Cape Town. If you take the Atlantic Seaboard and you take the leafy suburbs of Newlands, Constantia and so on, then that number is surely not 1%. It is not even 2% - the number is significantly different. Then you can add all of these exclusive golf courses in the Western Cape. The numbers are substantially different. What we must not do is to polarise it. We have to recognise that every country capable of taking decisions about these things, tends to do so.

Agb Mulder, jy weet die Afrikaans wat sal voortduur, is ’n Afrikaans wat alle Suid-Afrikaners wil insluit. Die Afrikaans wat sal voortduur is ’n Afrikaans wat Suid-Afrikaans wil wees. Die Afrikaans wat ongelukkig sal sterf, is die Afrikaans wat homself sal afsonder. Dit is die Afrikaans van mnr Roodt en u het gedeeltelik vir mnr Roodt aangehaal in u toespraak. Ek is daardeur geskok. Ek is daardeur geskok, maar dit is ook baie belangrik dat ons sê dat die Afrikaans wat soek vir die bydrae van die Afrikaner tot die fiskus van die land, is die Afrikaans van afsondering. Dit is die Afrikaans sonder toekoms. Dit is die Afrikaans van die verlede, nie die Afrikaans wat homself voldoende Suid-Afrikaans wil maak nie. [Applous.] (Translation of Afrikaans paragraph follows.)

[Hon Mulder, you know that the Afrikaans that will endure is an Afrikaans that wants to include all South Africans. The Afrikaans that will endure is an Afrikaans that wants to be South African. The Afrikaans that will unfortunately perish is the Afrikaans that will isolate itself. That is the Afrikaans of Mr Roodt and you briefly quoted Mr Roodt in your speech. I am shocked by that. I am shocked, but it is also very important for us to say that the Afrikaans that seeks the contribution of the Afrikaner to the fiscus of the country is the Afrikaans of isolation. It is the Afrikaans without a future. It is the Afrikaans of the past, not the Afrikaans that wants to make itself sufficiently South African. [Applause.]]

The hon Pheko is not in the House. He talks about odious apartheid debt but I am not sure what he is talking about. I am not sure what the source of his figures is. Is he here? [Interjections.] Maybe he joined the DA – I don’t know. [Interjections.] The debt service cost that we have in the Budget documentation is 3,5% of GDP. I don’t know where he got his figures. I can say this to him without fear of contradiction: All of that is money that this democratically elected government had borrowed to finance the deficit, so clearly it is not part of any odious apartheid debt.

Hon Rabie, please check the date on your speech. I think that is last year’s speech. I am sure it is. I have heard it before. The hon Bekker is wearing a green shirt because he spoke about the green revolution. The question that you need to answer, sir, in all honesty to yourself, is: What are these factories going to produce that you are talking about? These factories that produce pig iron don’t employ people. Even our steel mills – and you can go to Saldanha Steel and see for yourself – do not employ more than 200 people. The key challenge is to find out what we can do differently and better.

If we try and hang on to the past and if we try and manufacture and believe that we will outsmart the Chinese at the low end of the market, we won’t do it. We won’t do it. The Chinese are not going to invest here. They are going to invest in China primarily. There is a source of imbalance in the world. You have to step back from the issues, step back from the Budget debate, pause for a moment and then recognise that for as long as China has its currency pegged to the dollar, the rest of the world will be uncompetitive. For as long as China is growing at the rate that it is growing, it will suck up every raw material from everywhere in the world. For as long as China is producing rich people at the rate that it is, it will need oil. And for as long as it sucks oil from all over the world, from every available source, the oil price will remain at the levels it is at. We have a source of instability in the world. We have no control over it, but we clearly need to understand it and engage with it. Stop using it as a stick to beat ourselves because under the circumstances we still are, in many respects, the envy of many developing countries around the world. That is what we need to understand. That is the context of this discussion. [Applause.]

We’re a young democracy battling in exceedingly adverse circumstances with enormous numbers of poor people, very poor skills endowments – largely the result of where Dr Van Dyk comes from – and that denial of skills to the majority of South Africans is not going to be healed in only a period of 10 years of democracy. It is a lifelong challenge for all of us and we need to understand and engage with it, and stand up and be counted in order to effect change in respect of it. It is not going to disappear. [Applause.] It is not going to disappear because you happen to shout at it. It is a reality of life. We have a skills mismatch in this economy and that is what we have to deal with. [Interjections.]

There are some members of this side of the House who might be residents of Jurassic Park, rather than a democratic South Africa. There’s very little point in arguing with them. They won’t listen. They sit together and perhaps they influence each other to go down the shaft in the way that they do. They certainly don’t contribute to the enrichment of the Budget debate in this country. But for all of you who are not residents of Jurassic Park, thank you for your contributions. We have a good Budget. Let us take it forward and build democracy in South Africa. Thank you. [Applause.]

Debate concluded.

Bill read a first time.

The House adjourned at 17:58. ____

            ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS

                       THURSDAY, 10 MARCH 2005

ANNOUNCEMENTS:

National Assembly:

1. Referrals to committees of papers tabled:

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


 (1)    The Fifth Economic and Social Rights Report of the South African
     Human Rights Commission for 2002-2003 is referred to the following
     Portfolio Committees:


     (a)     Chapter 1 - "The Right to Land" is referred to the
          Portfolio Committee on Agriculture and Land Affairs for
          consideration and report.

     (b)     Chapter 2 - "The Right to Food" and

     (c)     Chapter 4 - "The Right to Social Security" is referred to
          the Portfolio Committee on Social Development for
          consideration and report.

     (d)     Chapter 3 - "The Right to Health Care" is referred to the
          Portfolio Committee on Health for consideration and report.
     (e)     Chapter 5 - "The Right to a Healthy Environment" is
          referred to the Portfolio Committee on Environmental Affairs
          and Tourism for consideration and report.

     (f)     Chapter 6 - "The Right to Education" is referred to the
          Portfolio Committee on Education for consideration and report.

     (g)     Chapter 7 - "The Right of Access to Adequate Housing" is
          referred to the Portfolio Committee on Housing for
          consideration and report.

     (h)     Chapter 8 - "The Right to Water" is referred to the
          Portfolio Committee on Water Affairs and Forestry for
          consideration and report.


 (2)    The following papers are referred to the Portfolio Committee on
     Public Service and Administration for consideration and report:


     (a)     Report of the Public Service Commission on the Causes and
          Effect of Mobility amongst Senior Management Service and
          Professional Staff in the Public Service [RP 195-2003].
     (b)     Report of the Public Service Commission on the
          Investigation into the Re-employment of Persons Retired due to
          Ill-health [RP 32-2004].

     (c)     Report of the Public Service Commission on the Management
          of Discipline in the Public Service [RP 141-2003].

     (d)     Report of the Public Service Commission on the Dispute
          Resolution Mechanisms in the Public Service [RP 198-2003].

     (e)     Report of the Public Service Commission on the Abilities
          of the Departments to deal with devolved authority regarding
          Remuneration and Conditions of Service.

     (f)     Report of the Public Service Commission on the Management
          of the Subsidised Motor Transport Scheme [RP 33-2004].

     (g)     Report of the Public Service Commission on Remunerative
          work outside the Public Service - An Investigation undertaken
          in the Gauteng Provincial Health Sector [RP 219-2003].
     (h)     Report of the Public Service Commission - State of the
          Public Service Report for 2004.

     (i)     Report of the work of the Interim Management Team (IMT) in
          the Eastern Cape for the period November 2002 to March 2004.


 (3)    The following paper is referred to the Portfolio Committee on
     Water Affairs and Forestry for consideration:

     Strategic Plan of the Department of Water Affairs and Forestry for
     2005-2008.

TABLINGS:

National Assembly and National Council of Provinces:

1. The Minister of Health:

 Strategic Plan of the Department of Health for 2005-2008.

1. The Minister of Sport and Recreation:

 Report and Financial Statements of Boxing South Africa for 2003-2004,
 including the Report of the Auditor-General on the Financial Statements
 for 2003-2004.


                        FRIDAY, 11 MARCH 2005

TABLINGS:

National Assembly and National Council of Provinces:

1. The Minister of Science and Technology

 Report and Financial Statements of the National Advisory Council on
 Innovation for 2003-2004.

National Assembly:

1. The Speaker:

 Report of the Independent Electoral Commission (IEC) on the National
 and Provincial Elections for April 2004.



                       TUESDAY, 15 MARCH 2005

ANNOUNCEMENTS:

National Assembly:

1. Membership of Committees:

 (1)    The following changes have been made to the membership of
     Portfolio Committees, viz:

 Health:
 Appointed: Kohler-Barnard, Ms D.
 Discharged: Steyn, Mr A C.

COMMITTEE REPORTS

National Assembly

CREDA PLEASE INSERT REPORT - INSERT ATC0315