National Assembly - 11 November 2005
FRIDAY, 11 NOVEMBER 2005 __
PROCEEDINGS OF THE NATIONAL ASSEMBLY
____
The House met at 09:03.
The House Chairperson, Mr G Q M Doidge, took the Chair and requested members to observe a moment of silence for prayers or meditation.
ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS – see col 000.
NOTICES OF MOTION
Dr S M VAN DYK: Chairperson, I hereby give notice:
That the House –
(1) debates the question of the abolition of exchange controls as suggested by Mr Tito Mboweni, the Governor of the Reserve Bank.
REMEMBRANCE DAY FOR THOSE WHO DIED FOR THEIR COUNTRIES IN WARS
(Draft Resolution) The CHIEF WHIP OF THE OPPOSITION: Chairperson, I hereby move without notice:
That the House -
(1) notes that today is Remembrance Day when those who died for their country or cause in various wars and conflicts across the world are formally remembered;
(2) believes that -
a) it is important for them, whom we remember, that we ensure a
form of collective consciousness so that they should never be
forgotten;
b) as long as the people of the world remember those who died,
the democratic countries have a good chance of remaining at
peace;
c) those who died will not be forgotten and that their sacrifice
was not in vain; and
(3) therefore observes a moment of silence as a tribute to those who lost their lives in various wars and conflicts.
The CHIEF WHIP OF THE MAJORITY PARTY: Chairperson, we did not get the motion beforehand. We have absolutely no objection to it, but this new, fundamental and substantive suggestion for the House to rise will not receive support from the ANC.
The CHIEF WHIP OF THE OPPOSITION: Chairperson, the motion was certainly circulated. I think that it would be unfortunate to have a wrangle about a motion like this. If it is unacceptable for the ANC to observe a moment of silence, then I withdraw part five, and I move parts one to four.
The CHIEF WHIP OF THE MAJORITY PARTY: Chairperson, let me clarify something. This matter must not be politicised at all, as it is a procedural matter. According to the Rules of the House, it is unprecedented for the House to observe a moment of silence. It is purely on that basis that we object to it. So it is not as if the ANC objects to the entire motion.
The CHIEF WHIP OF THE OPPOSITION: Chairperson, may I remind the House that this is exactly the motion that we adopted last year - and we observed a moment of silence standing, last year. So, it is not unprecedented.
The Chief Whip of the Opposition, with leave, moved the motion with the omission of paragraph (3).
Motion, as amended, agreed to namely:
That the House -
(1) notes that today is Remembrance Day when those who died for their country or cause in various wars and conflicts across the world are formally remembered;
(2) believes that -
(a) it is important for them, whom we remember, that we ensure
a form of collective consciousness so that they should never
be forgotten;
(b) as long as the people of the world remember those who
died, the democratic countries have a good chance of remaining
at peace; and
(c) those who died will not be forgotten and that their
sacrifice was not in vain.
CONGRATULATIONS TO MS MARIA RAMOS ON BEING SELECTED AS BUSINESS LEADER OF THE YEAR
(Draft Resolution)
The CHIEF WHIP OF THE MAJORITY PARTY: Chairperson, I move without notice:
That the House –
(1) notes that Ms Maria Ramos, group chief executive of Transnet, was selected Business Leader of the Year at the Sunday Times Business Times Top 100 Companies awards on Tuesday, 8 November 2005; and
(2) extends its congratulations to Ms Ramos, viewing this as a vote of confidence from her peers in the business world and hoping that this is an indication that women are starting to get the acknowledgement they deserve from their peers in the business world.
Agreed to.
QUESTIONS TO DEPUTY PRESIDENT TO BE SCHEDULED FOR WEDNESDAY, 16 NOVEMBER 2005
(Draft Resolution)
The CHIEF WHIP OF THE MAJORITY PARTY: I move the first motion printed in my name on the Order Paper, as follows:
That, notwithstanding Rule 110(2)(b), which provides that questions to the Deputy President must not be scheduled for the same week in which the Deputy President is scheduled to answer questions in the Council, questions to the Deputy President be scheduled for Wednesday, 16 November 2005.
Agreed to.
RULE 253(1) TO BE SUSPENDED SO THAT SECOND READING DEBATE ON DIAMONDS
SECOND AMENDMENT BILL CAN TAKE PLACE
(Draft Resolution)
The CHIEF WHIP OF THE MAJORITY PARTY: I move the second motion printed in my name on the Order Paper, as follows:
That Rule 253(1), which provides inter alia that the debate on the Second Reading of a Bill may not commence before at least three working days have elapsed since the committee’s report was tabled, be suspended for the purposes of conducting the Second Reading debate on the Diamonds Second Amendment Bill [B 39B – 2005] (National Assembly – sec 76) today.
Agreed to.
CAMPAIGN AGAINST MALARIA BY THE SOUTHERN AFRICAN DEVELOPMENT COMMUNITY COMMENDED
(Member’s Statement)
Ms M N S MANANA(ANC): Chairperson, today the Southern African Development Community will highlight the campaign against malaria. The national Ministry of Health, together with all health ministries of the SADC region and the nine provincial MECs, will observe this day in one of our most affected provinces, KwaZulu-Natal.
We commend the ANC-led government in its attempt to raise awareness of this devastating disease that affects millions of people annually. Most cases of malaria, 90%, occur in Africa.
In South Africa we have managed to successfully lower the infection rate through the education of communities and by spraying homes with pesticides. Our affected provinces are mainly Limpopo, Mpumalanga and north eastern KwaZulu-Natal.
We asked the relevant department to contact communities in the affected areas in order to assist them with information about the preventative measures that can be taken to lessen the risk of malaria.
We also urge the relevant provincial health department . . . [Time expired.]
AFRIKAANS AS A LANGUAGE OF TUITION AT THE UNIVERSITY OF STELLENBOSCH
(Member’s Statement)
Dr J T DELPORT(DA): Voorsitter, die konvokasie van die Universiteit van Stellenbosch het onomwonde, en met ’n oorweldigende meerderheid, die wens uitgespreek dat die universiteit ’n Afrikaanse universiteit, wat meertaligheid bevorder, sal bly; dat transformasie en diversiteit deur middel van Afrikaans, en binne ’n Afrikaanse karakter en konteks sal geskied, en nie ten koste van Afrikaans nie.
Dit is ’n kernbeginsel van die Grondwet dat elkeen geregtig is op die uitbouing van sy taal. Afrikaans neem as wetenskapstaal sy plek in tussen wêreldtale. Afrikaans is ’n bate vir Suid-Afrika - tot nou toe die enigste inheemse taal wat tot volle wasdom gekom het in die moderne wetenskaplike en tegnologiese wêreld. Die handhawing, maar ook uitbouing van Afrikaans, op hierdie vlak, is in die hande van die Universiteit van Stellenbosch.
Die konvokasie van die universiteit word gelukgewens met sy standpunt, en die herverkose president van die konvokasie, prof Pieter Kapp, word sterkte toegewens.
Die DA versoek die regering om die navolgingswaardige siening van oud- president Nelson Mandela, naamlik dat daar minstens een Afrikaanstalige universiteit in Suid-Afrika moet wees, in beginsel, maar ook prakties en finansieel te steun. Mag my en 70 000 ander se alma mater, die universiteit op die wal van die Eersterivier, voortgaan om die hele Suid-Afrika te dien, soos gestel in sy leuse: Pectora roborant cultus recti. [Applous.] (Translation of Afrikaans member’s statement follows.)
[Dr J T DELPORT (DA): Hon Chair, the convocation of the University of Stellenbosch unreservedly and with an overwhelming majority expressed the wish that the university should remain an Afrikaans university that promotes multilingualism; that transformation and diversity should occur by means of Afrikaans and within an Afrikaans character and context, and not at the expense of Afrikaans.
It is a core principle of the Constitution that all people are entitled to the enhancement of their languages. Afrikaans takes its place among the world’s languages as a language of the sciences. Afrikaans is an asset to South Africa – to date the only indigenous language to attain maturity in the modern scientific and technological world. The preservation, but also the enhancement of Afrikaans at this level lies in the hands of the University of Stellenbosch.
The convocation of the university is congratulated on its stand, and best wishes to the re-elected president of the convocation, Prof Pieter Kapp.
The DA requests the government to support, not only in principle, but also in practice and financially, the commendable view of former president Nelson Mandela that there should be at least one Afrikaans-language university in South Africa. May my own alma mater and that of 70 000 others, the university on the banks of the Eerste River, continue to serve the whole of South Africa in accordance with its motto: Pectora roborant cultus recti. [Applause.]]
DEPARTURE FROM PARLIAMENT OF SOME MEMBERS WITH NECESSARY INTELLECTUAL
ABILITIES AND EXPERIENCE
(Member’s Statement)
Mr M B SKOSANA(IFP): Chairperson, in the Cape Times, not so long ago, the hon Ben Turok, a member of this House, lamented the incremental departure from Parliament of some of the members with necessary intellectual abilities and profound struggle experience, only to join business and financial enterprises.
This is a widely shared observation and perhaps deep concern by many, that 10 years of political emancipation will not instantly and adequately compensate for more than three centuries of physical, emotional, psychological, political and cultural oppression and domination of the African majority through successive colonial and apartheid racial policies.
Politicians and leaders of substance have been led, rightly or wrongly, to leave the national institution of Parliament to join private enterprises with prospective benefits. Unfortunately, some seem to possess limited powers to enable them to use economic privileges to transform the political state and its financial institutions for the common good.
The fundamental lesson here is that we should not equate the few opportunities afforded an individual or a small group of people to set up economic kingdoms, with egalitarian economic democracy and distributive justice, particularly when it is evident that the majority continue to wallow in poverty and underdevelopment.
Although it is acknowledged that the political freedom of the oppressed is fundamental, it cannot be sustained while the financial and economic hegemony remains in the hands and control of a few. At the same time the continual weakening of Parliament’s human fulcrum of genuine social transformation is threatening to confine black South Africans to a perpetual state of sophisticated slavery and modern age bondage.
The HOUSE CHAIRPERSON (Mr G Q M Doidge): Order! Hon member, your speaking time has expired.
Mr M B SKOSANA(IFP): The question posed then, Mr Chairman, by poet Langston Hughes, and later by President Mbeki, is still appropriate: What happens to a dream deferred? [Time expired.]
IMPACT OF CLIMATE CHANGE ON ENVIRONMENT
(Member’s Statement)
Ms C C SEPTEMBER(ANC): Chairperson, the ANC welcomes the adoption of an integrated and intersectoral approach to managing the effects of climate change during the National Conference on Climate Change held in October this year, 2005. The persistent drought in many parts of the country serves as a wake-up call to all of us to play our part in conserving our natural resources such as water.
It was acknowledged that the impact of global warming has dire consequences on the economies of developing countries, and our government’s intersectoral approach is a progressive method of dealing with this challenge.
The ANC-led government has already put in place flexible water policies, and laws and strategies to deal with the impact of climate change on our natural resources. We are confident that the conference marked a start to efforts to ensure that further strategies are put in place that will put the poor and vulnerable at the forefront of all plans regarding the impact of climate change on water resources and water demand. Thank you.
THREAT OF FIRES TO INFORMAL SETTLEMENTS
(Member’s Statement)
Mr J BICI(UDM): Chairperson, the fire season is upon us once more. In the past months numerous veld, forest and shack fires have destroyed property and homes and have taken lives across the country. The latest incident, yesterday, destroyed the dwellings of 150 families at Khayamnandi. These devastating fires run through informal settlements in a matter of minutes.
Whilst many resilient measures have been explored, it remains clear that the implementation of fire safety measures is not universal. The country as a whole has seen relatively little rain in the past year. Therefore, the thought of more devastating and deadly fires cannot be ignored.
We appeal to all local authorities to inspect their nearby informal settlements and seek ways of limiting the dangers and improving access to fire fighters in the event that they are needed. At the very least, a very visible public awareness campaign is required. Thank you.
SA NATIONAL AIDS COUNCIL - ROLE, MEETINGS, EXPENDITURE
(Member’s Statement)
Mr A HARDING(ID): Chair, the ID is dismayed at the recent report that the SA National Aids Council has only met once this past year and that it has incurred a bill of R540 000 for rent. This money could have been enough to provide a full year’s ARV treatment for 500 HIV-positive people. It is especially shocking, because Sanac should be the leading body in ensuring that we are effectively tackling the HIV/Aids pandemic.
When Sanac was first formed, it was mandated to meet once a month, which was then changed to once every quarter, and now it seems to be meeting only once a year. In addition, Sanac has not reviewed the National Aids Plan approved by the Cabinet in 2003. It seems that there is a frightening lack of political will on the part of the government to ensure that this body plays an effective part in directing our national response.
The scale of the problem facing us in South Africa is enormous and it’s growing worse by the day. There has been a fourfold increase in infections in the age groups fifteen to nineteen at the hospital in Jozini in the northern KZN, which has reported that of the 150 pregnant mothers visiting a month, 85 to 90 are HIV-positive. Given this reality, we need to be using every resource we have in government, business and civil society. Sanac needs to live up to its mandate. Thank you. [Time expired.]
FORTHCOMING LOCAL GOVERNMENT ELECTIONS
(Member’s Statement)
Mr M G PHADAGI(ANC): Chairperson, the people of South Africa will soon take part in the third democratic local government election. This presents an opportunity to all South Africans to participate in the democratic process of choosing candidates who are committed to serving our people and promoting the reconstruction and development programme of our country.
As the ANC, we commit ourselves to encouraging our members to carefully consider who the best candidate should be. We pledge to be vigilant in preventing people with selfish motives and self-interest from being considered as candidates for election in the forthcoming local government election.
The forthcoming local government election will give people the opportunity to take part in the political life of our country. Voters will have the opportunity to say no to candidates who seek to abuse their elected positions. The ANC urges voters to exercise their right to vote and to help us strengthen our local government system by electing candidates who put the needs of the people first. Thank you. [Applause.]
BETTER SERVICE DELIVERY URGED
(Member’s Statement)
Ms M M MDLALOSE(Nadeco): I have a statement, sir. Nadeco acknowledges the intentions by the various government departments to improve service delivery. Nadeco also acknowledges the raised expectations such intentions can cause and the frustrations that can result when the expectations are not met.
Given certain recent events, Nadeco urges that a better planned and co- ordinated approach to service delivery be adopted, especially in areas where delivery failures have been evident in recent times.
The lack of co-ordination within and between departments seem to be due to weaknesses in project design and management. This often leads to wasteful spending of substantial sums of public moneys, such as the purchase of farms for land claimants who are not given the essential skills and back-up resources or which are not transferred timeously while they are still productive. Better planning and co-ordination could prevent such costly failures and the frustration that otherwise tends to boil over.
PEOPLE URGED TO ENGAGE IN DEMONSTRATIONS AND PROTESTS PEACEFULLY
(Member’s Statement)
Mr P J NEFOLOVHODWE (Azapo): Chairperson, Azapo is highly concerned about the implications of the violent actions that take place in several townships. The marches, the burning of trains and the running battles with law enforcement agencies are a warning sign that the poor people are beginning to lose heart about the slow pace of transformation and lack of delivery. However, the destruction of property and looting is counterproductive and uncalled for.
Our country should by all means try to avoid the pitfalls that crippled many African countries after independence. Most of them demobilised their forces and pretended to be normal societies. As a result the living conditions of indigenous people declined, unemployment increased in tandem with the decreasing level of social service delivery.
To Azapo, delivery is not an issue on the basis of which political parties should engage in point-scoring. It is an issue that determines the quality of the freedom we are talking about. It is on the basis of this view that Azapo would like to appeal to all peace-loving people to engage in demonstrations and protests peacefully.
At the same time, those in responsible positions should not be overwhelmed by the newfound possibilities of self-enrichment and advancement. To do so will be to betray the very basis of the freedom we fought for. The simmering political discontent should be addressed. Thank you. [Time expired.]
RAIL COMMUTER SERVICES IN SHAMBLES AND A CAUSE FOR CONCERN
(Member’s Statement)
Mr S B FARROW(DA): Chair, something is radically wrong with our rail commuter service. The recent burning of 28 Metrorail coaches in Gauteng by commuters, angered and frustrated by delays and poor service, at a cost of nearly R200 million to the state, cannot be condoned. Every effort must be made to bring the perpetrators to book.
The announcement by United Transport and Allied Trade Union that their drivers are also under threat, and the planned strike by 145 Metrorail drivers in Durban, all add to the concerns that not enough has been done to upgrade and improve services and conditions in which Metrorail has to operate.
The blame cannot be levelled at Metrorail alone, as they don’t own the old rolling stock and infrastructure. However, the state is seriously considering throwing R20 billion into the exclusive Gautrain, which caters mainly for the wealthier sectors of Tshwane and Johannesburg.
This R20 billion injection by National Treasury into what could be the biggest white elephant in the country, if its ridership levels are not met, will cost every single citizen of this country R500, which is nearly three times what the average rail commuter spends per month in getting to and from work.
Our public transport is in chaos. A serious relook at priorities must be made to find a solution to the anger and frustrations that cause the burning of these scarce assets. The DA believes that the R20 billion Gautrain project does not at this stage appear to be part of the greater solution facing rail, bus or taxi commuters in South Africa. Thank you. [Applause.]
LANGUAGE POLICY AT STELLENBOSCH UNIVERSITY
(Member’s Statement)
Adv A H GAUM (ANC): Mnr die Voorsitter, onlangse stellings van die agb Tony Leon dat die ANC die Universiteit van Stellenbosch en ander histories Afrikaanssprekende universiteite onder toenemende druk plaas om te verengels is ooglopend van alle waarheid ontbloot.
Die ANC is diep bewus van die emosionele debat wat tans oor die onderrigtaal van die Universiteit van Stellenbosch gevoer word. Die ANC- regering se beleid oor taal in hoër onderwysverband word vervat in ’n dokument getiteld Taalbeleid vir Hoër Onderwys. Hierdie beleid verskaf die raamwerk waarbinne universiteite en ander hoëronderwysinstellings self hulle taalbeleid moet formuleer.
Ons wil dit baie duidelik stel dat ons Afrikaans as ’n inheemse taal van ons land beskou en die taal saam met die ander inheemse tale van Suid- Afrika wil bevorder en uitbou. Die US se uitdaging is hoe om van die universiteit ’n waarlik inklusiewe instelling te maak waarin Afrikaans steeds kan gedy en nie bedreig of benadeel word nie. Die ANC vertrou dat die Universiteit van Stellenbosch hierdie uitdagende taak sal baasraak. Ek dank u. [Applous.] (Translation of Afrikaans member’s statement follows.)
[Adv A H GAUM (ANC): Mr Chairperson, recent statements by the hon Tony Leon that the ANC is placing increasing pressure on the University of Stellenbosch and other historically Afrikaans-speaking universities to become Anglicised, are obviously devoid of any truth.
The ANC is profoundly aware of the emotional debate being conducted at present with regard to the language of instruction at the University of Stellenbosch. The ANC government’s policy regarding language in the context of higher education is contained in a document entitled Language Policy for Higher Education. This policy provides the framework within which universities and other institutions of higher education must formulate their own language policies.
We want to state very clearly that we see Afrikaans as an indigenous language of our country and we want to promote and enhance this language together with the other indigenous languages of South Africa. The challenge facing the US is how to make the university a truly inclusive institution in which Afrikaans can still thrive and not become threatened or adversely affected. The ANC trusts that the University of Stellenbosch will master this challenging task. I thank you. [Applause.]]
SABC NEWS BROADCASTS BIASED
(Member’s Statement)
Mr V B NDLOVU (IFP): Chairperson, the IFP have observed and recognised the bias of the SA Broadcasting Corporation, especially TV, in dispersing news gathered here in Parliament. Some parties seem to have an upper hand and are fully recognised and favoured as the representatives of the people, at the expense of others.
The SABC is supposed to inform and educate people on correct information and without bias, but it is failing to do so. The IFP will write a formal complaint to the SABC board and its management about the actions of the SABC news editors, because they are so biased.
GOOD WISHES TO MINISTER OF DEFENCE
(Member’s Statement)
Mr A MLANGENI(ANC): Chairperson, we have read in the papers that our hon Minister of Defence, Terror Lekota, has been hospitalised. This House wishes him a speedy recovery, because we would like to see him return to the House and to his department. Thank you. [Applause.]
DISCIPLINARY PROBLEMS AT WESTERN CAPE MUNICIPALITIES
(Member’s Statement)
Mr W P DOMAN (DA): Voorsitter, munisipaliteite in die Wes-Kaap is sedert 2000 goed bestuur. Die posisie het egter aanmerklik versleg sedert die NNP ’n aantal munisipaliteite se beheer in die hande van die ANC geplaas het. In Drakenstein in die Paarl sukkel die munisipaliteit nou reeds maande lank om ’n nuwe munisipale bestuurder aan te stel omdat die ANC-burgemeester Bailey op meriete ’n bruin persoon wil aanstel ná ’n uitgerekte proses van advertensies en onderhoude wat die munisipaliteit al oor die R200 000 kos, maar die Skwatsha-kamp het opdrag gegee dat ’n swart kandidaat aangestel moet word wat nie onder die eerste sewe kandidate was nie.
In Laingsburg gaan nou ’n ondersoek kom omdat die munisipaliteit meer as R100 000 aan ’n huis spandeer het, net om dit daarná sonder openbare deelname teen R92 000 aan die ANC-burgemeester Gouws te verkoop.
In Kannaland is die adjunk-munisipale bestuurder nou al sedert April verlede jaar met volle salaris geskors terwyl die ANC-LUR’e en ANC-raad niks daaromtrent afhandel nie. Die vorige burgemeester sit nog knus in die raad alhoewel die Dekker-kommissie bevind het dat hy groot somme geld gebruik het om sy musiekinstrumente vir sy orkes en onderdele vir sy motor aan te vul, en sommer nog kontant aan sy ANC-veldwerkers ook uitgedeel het.
In Beaufort-Wes is mnr Truman Prince daarby betrokke dat die burgemeestersfonds gebruik is om vir ’n vriend van hom borgtog te betaal wat intussen tronk toe gestuur is. Hy het intussen verstommend genoeg ’n prestasiebonus van etlike tienduisende rande ontvang, ten spyte daarvan dat . . . [Tyd verstreke.] (Translation of Afrikaans member’s statement follows.)
[Mr W P DOMAN (DA): Chairperson, municipalities in the Western Cape have, since 2000, been well managed. The situation has, however, deteriorated markedly since the NNP placed the management of a number of municipalities in the hands of the ANC.
In Drakenstein in Paarl the municipality has already been struggling for months to appoint a new municipal manager because the ANC mayor Bailey wants to appoint a coloured person on merit after a protracted process of advertisements and interviews that is already costing the municipality more than R200 000, but the Skwatsha camp has given the instruction that a black candidate, who did not feature amongst the top seven candidates, must be appointed.
In Laingsburg an investigation will now follow because the municipality spent more than R100 000 on a house, only to sell it, without any public participation, to the ANC mayor Gouws for R92 000.
In Kannaland the deputy municipal manager has been suspended with full pay since April last year, while the ANC MECs and the ANC council are doing nothing to conclude the matter. The previous mayor is still sitting snugly in the council although the Dekker Commission found that he had used vast sums of money to add musical instruments to his orchestra and spare parts for his car, and dished out cash to his ANC field workers to boot.
In Beaufort West Mr Truman Prince was involved in using the mayoral fund to pay the bail of a friend, who had been sent to jail in the meantime. In the interim he, amazingly enough, received a performance bonus of tens of thousands of rands, in spite of the . . . [Time expired.]]
SMALL ENTERPRISE DEVELOPMENT AGENCY SUMMIT A RESOUNDING SUCCESS
(Member’s Statement)
Mr S M RASMENI(ANC): Chairperson, the Seda - that is, the Small Enterprise Development Agency - national small enterprise summit that took place in the North West from 30 October to 1 November 2005 was a resounding success. The summit attracted over 300 delegates comprising of national and provincial departments, big corporations, small businesses, support service providers and entrepreneurs.
Discussions related to aligning the activities of government and the private sector with the current strategies of Seda. It was evident that the Seda model was well accepted. It was reported that the North West province has been the most successful in implementing the strategy of Seda.
In line with the Small Business Act, the ANC urges all structures at national, provincial and local level to support and co-operate with Seda in its efforts to roll out the establishment of support structures for small business development. Thank you. [Applause.]
SOUTH AFRICA NEEDS TO ENHANCE THE EFFICIENCY OF ITS TRANSPORT SYSTEM
(Minister’s Response)
The DEPUTY MINISTER OF FINANCE: Chairperson and hon members, an issue has been raised around the Gautrain, which I think has enjoyed quite some coverage in recent times in the media. However, I think that it would be correct for us to remind ourselves of the justification for and the strategy around the implementation of the Gautrain project.
Of all the things that I think we all know is that the purpose of this infrastructure project was to improve the mobility of factors between two key areas, Johannesburg and Pretoria. We know that that is a developing spine. To a large extent, there has hitherto never been a mass transit system to service that spine.
The second aim of this project was to connect our prime arrival point, that is the Johannesburg International Airport, to an area that is a concentration of hospitality industry facilities, namely Sandton.
The third aim of the project, which is also quite important, was to increase the mobility of tourists that come into South Africa, to ensure that they are able to move around Pretoria and Johannesburg.
It is also important to note that the matter has been raised in terms of value for money and appropriate spending; there’s no argument about that. These deliberations, as we all know, have been entertained in the portfolio committee dealing with issues of transport.
I believe that at the end of the day these deliberations will inform appropriate decisions in terms of ensuring that this facility enhances the efficiency of the transport system in South Africa.
I think that is important. I have not heard anybody say that we don’t need this infrastructure. What has been raised is the question of whether or not this would be money well spent. And I think that those are matters that are considered by the portfolio committee.
Lastly, the Department of Transport – I believe – as the key co-driver of this issue, would basically consider all the input made. However, at the end of the day South Africa needs to extend its transport facilities. South Africa needs to extend its sophistication in terms of movement of factors. The Gautrain makes a contribution towards that.
At some point in time we’ll have to come up with a system that basically addresses some of the issues of transport shortage that we are currently facing. Thank you.
THREAT OF CLIMATE CHANGE TO SOUTH AFRICA NOT APPRECIATED
(Minister’s Response)
The DEPUTY MINISTER OF SCIENCE AND TECHNOLOGY: Chairperson, I’d like to thank the hon member Connie September for raising in this House the issue of global climate change. I think the House perhaps should give this matter more attention.
Possibly, the extent to which global climate change poses a threat to our country is not appreciated. Now, we would like to suggest that the House gets a full presentation on the threat global climate change poses to our country and to the world, and for it to be debated in this House, with valuable contribution from this House as to how best we should respond to it.
The irony, Chairperson, is that the African continent is the least guilty of carbon dioxide emissions, yet it is the most affected by global climate change and global warming. The country in the world mostly responsible for this is the United States of America. It is ironic that the USA attacks another country on the spurious grounds that it has weapons of mass destruction, which, it then turns out, it does not, and is continuing with practices that threaten the future of this planet. We need to be mindful of that.
South Africa – if I may turn to South Africa for one moment – is not one of the major contributors, but yet per capita we have to be very clear that we are contributing greatly towards this potential danger that threatens our planet. We should do something about it, and we are doing something about it.
Science and Technology is working very closely with the Department of Minerals and Energy, and we have some very innovative programmes. The hon member brought to our attention the Working for Water programme. We really need to give this programme more impetus and more support.
Similarly, Science and Technology has introduced a pilot programme to bring to the advantage of poor households a very modest and affordable solar heating system. One day, Chairperson, when we have time, we will share some of these projects with this House. However, the challenge is for us together to do whatever we can to reduce carbon dioxide emissions and marry that with the need to bring energy to the people on an affordable and continuous basis. Thank you. [Applause.] ISSUE OF LANGUAGE OF INSTRUCTION WAS DISCUSSED WITH INSTITUTIONS OF HIGHER LEARNING
(Minister’s Response)
USEKELA-MPHATHISWA WEZOBUGCISA NENKCUBEKO: Mhlalingaphambili, ngokubhekisele kwiilwimi ezisetyenziswayo apha eMzantsi Afrika, ndifuna ukubulela obekekileyo uMnu Gaum ngenkcazo ayenzileyo apha namhlanje. Laa nkcazo ayenzileyo iphendula nqo laa mba ubuvuswe yi-DA.
Xa ndiyicacisa, ndifuna ukutsho ukuba kwangonyaka ka-2003, iKhabhinethi yawuxoxa lo mcimbi weelwimi kwizikolo zemfundo ephakamileyo, yaze yavumelana ngomgaqo-nkqubo wokuba isiBhulu isenokuba lolunye lweelwimi ezinokusetyenziswa kwiDyunivesiti yase-Stellenbosch. Le dyunivesiti yavumelana naloo mba.
Masiqaphele ukuba isiBhulu, naxa sifike mva eMzantsi Afrika, silelinye leelwimi kwezi zili-11 ezisetyenziswayo ngokomthetho walapha, kodwa sizifumana sikwibakala elilinganayo nezinye iilwimi ezi ezili-10. Kungoko ke sikhuthaza, kwaye nezikolo zemfundo ephakamileyo zavumelana noku, ukuba nazo izikolo ziza kuqhubela phambili imizamo yokuqinisekisa ukuba zonke ezi lwimi ziyasetyenziswa. Asikwazi kuluqonda ke uloyiso oluvuyisa i-DA namhlanje, ngokungathi lo mcimbi zange khe uxoxwe kuvunyelwane ngawo ngaphambili. Enkosi. [Kwaqhwatywa.] (Translation of Xhosa Minister’s response follows.)
[The DEPUTY MINISTER OF ARTS AND CULTURE: Chairperson, I am grateful to Mr Gaum for the explanation he gave here today concerning the languages that are used in South Africa. The explanation given is a reply to the issue raised by the DA.
I want to clarify that Cabinet discussed the issue of languages in higher education institutions in 2003. It was agreed as a matter of policy that Afrikaans could be used as one of the languages at Stellenbosch University. The university agreed on this matter.
Although the use of Afrikaans came late in South Africa, it is one of the 11 official languages and therefore becomes equal to the other 10 official languages. The reason we encourage this is because higher education institutions agreed on this and schools are making sure that all the official languages are used. The victory that the DA is celebrating today is something that we cannot understand, because the issue had been agreed upon before. Thank you. [Applause.]]
SMALL ENTERPRISE DEVELOPMENT AGENCY, SEDA, TO HAVE SERVICE PROVIDERS EVEN AT LOCAL GOVERNMENT LEVEL
(Minister’s Response) The DEPUTY MINISTER OF TRADE AND INDUSTRY: Chairperson, I want to welcome the statement by the hon Rasmeni on the very important summit of Seda, the Small Enterprise Development Agency, which took place recently. Seda, of course, is the product of self-critical reflection and restructuring of small business service providers. Seda is in the process of rolling out a common platform of services that will in due course be accessible to small, medium and micro enterprises across the country. It is planned that eventually there will be a Seda service provider in every municipality in this country.
Unlike several of the service providers that were accredited by Ntsika in the past, Seda service providers will be obliged to provide services to entrepreneurs in the second economy, to very small micro businesses as well as co-operatives.
And this is a very important new departure. It’s very important, as the statement indicated, that there is co-ordination between national, provincial and local government. It is also very significant, therefore, that the summit that the statement mentioned reached a high level of common understanding about this. I think that it is very significant that this is drawn to the attention of the House and the country in this way. Thank you very much.
MISINFORMATION REGARDING SANAC
(Minister’s Response)
The DEPUTY MINISTER OF SOCIAL DEVELOPMENT: Chairperson, it has been pointed out that the SA National Aids Council, Sanac, has met only once this year. In the short time that I have been appointed Deputy Minister I have been to several Sanac meetings. So we don’t know where the member gets that information.
Furthermore, with regard to reviewing government’s comprehensive policy towards HIV and Aids, it’s not the task of Sanac to review this policy. Sanac is an advisory body. In fact the comprehensive policy of government is more comprehensive than most members of the opposition care to admit because they are always only complaining about one aspect, the antiretroviral treatment.
There is a comprehensive policy, and maybe members of the opposition should familiarise themselves with it before they raise any other issue.
One would also caution against the indiscriminate use of figures. One wonders where the member gets his figures, because there are all kinds of figures being quoted these days.
Finally, I attended the last meeting, just last week, in the Union Buildings and I doubt very much that it cost R500 000. I have a big question regarding the information. I think the hon member is misleading the House. Thank you.
MEMBER HAS RIGHT TO COMPLAIN TO SABC BOARD; PEACEFUL PROTESTS AND DEMONSTRATIONS, AND NOT VIOLENCE, SHOULD BE ENCOURAGED; ISSUE SURROUNDING
MR PRINCE SUB JUDICE
(Minister’s Response)
The MINISTER OF EDUCATION: Chairperson, with respect to the statement from the hon member of the IFP, I got the sense that the hon Skosana might have been reading Marx and Lenin recently, and in fact the hon Cronin, the deputy secretary-general of the SACP, indicated that if he wishes to discuss membership, he should indeed approach him. [Laughter.] That was a very radical view of how economic processes should unfold in our country.
I think that with regard to the hon member of the IFP who raised the matter of equal access to the public broadcaster, it certainly is well within the rights of the IFP to write to the SABC board, as he indicated. However, we should also remember that when news is selected, it should be newsworthy, and not news that you believe deserves attention - which might be very boring to the public. Nevertheless, it is the right of the member to write to the SABC.
I would like, however, to thank the hon members who have spoken of the recent protests that we have seen in our country, and the destruction of property, which is so worrying. And I believe it’s important that as MPs we do draw the attention of the public to the fact that our democracy allows for peaceful protest and submission of viewpoints. There is no need to encourage insurrection, violence or to intimidate and threaten any member of our society.
We are aware, as the ANC, that there is heightened interest in developing public profiles by various individuals in our communities, particularly given the process of selecting local government candidates. And we would like to urge our people not to be fooled by instant leaders who emerge like sudden blooms when we have rain in a very dry area and pretend to the community that they know what is best for the community by urging them to destroy properties. This is absolutely wrong. We reject it in its entirety. We support all the views that members have expressed that all communities and political parties must ensure that they select deserving and capable candidates for the local government elections.
With respect to the reference that has been made to Mr Prince, I think it’s important as members of Parliament that we do respect institutions of state. Members would be aware, even those who spoke, that that gentleman is appearing in court today. I would think that it’s very bad for us as members of Parliament to recognise sub judice when we want to, and ignore it when we choose to.
Also, the matter of the bonus is already a subject of investigation announced by the relevant MEC Jantjies. So, let’s not abuse the political space when it suits us. Thank you. [Time expired.] [Aplause.]
SPECIAL PENSIONS AMENDMENT BILL
(Consideration of Bill and of Report thereon)
The CHIEF WHIP OF THE MAJORITY PARTY: Chairperson, I move that the report be adopted.
Order disposed of without debate.
Motion agreed to.
Report accordingly adopted.
SPECIAL PENSIONS AMENDMENT BILL
(Second Reading debate)
The DEPUTY MINISTER OF FINANCE: Chairperson, hon members, the Special Pensions Amendment Bill before this House is an amendment to the Special Pensions Act, Act 69 of 1996.
The Special Pensions Act of 1996 gave effect to section 189 of the then interim Constitution of 1993, in that it provides for the payment of special pensions to persons, and lump sums to survivors’ eligible dependants, who made sacrifices or served in the public interest in the establishment of a nonracial, democratic constitutional order while serving full time in a banned or restricted political organisation and, therefore, as a consequence of such activity, were unable or prevented from providing for pensions for a significant period of time.
When the former Deputy Minister of Finance, Gill Marcus, introduced the Special Pensions Act to this House in 1996, she stated that the Act reflected the pain, anguish, torture and deprivation that so many people experienced under apartheid. She further indicated that the Act could not provide full restitution or correct all the errors, misfortunes and hardships caused by apartheid in those years. She further noted that while nothing can compensate for that, the provisions of this Act, therefore, are aimed at addressing the dire needs that these people experience, particularly in their old age.
The process leading up to the Special Pensions Act of 1996 was preceded by wide-ranging consultations with political organisations and NGOs. Public meetings were held in different parts of the country and the views of former political activists and political prisoners were also sought.
The passing of the Special Pensions Act in 1996 was indeed a historical event and unique in its foundation, and probably the first and only of its kind in the world. We are proud of the progress our country has made with the implementation of this dispensation.
A period of more than eight years has elapsed since the promulgation of the Special Pensions Act on 1 December 1996. The Act was amended in 1998 to enable the payment of a monthly pension to persons from the ages of thirty- five instead of sixty.
It was again amended in 2003 in order to condone late applications, as the period provided for the applications in terms of the Act was 12 months from the commencement date of the Act, which expired on 1 December 1997. Subsequent to 1 December 1997, a number of late applications have been condoned to date in terms of this Act.
I wish now to turn to the specifics of the Special Pensions Amendment Bill before the House today. Two main amendments are proposed in the Bill before you, which seek to amend the Special Pensions Act by providing for the following: Firstly, the lapsing of the provisions providing for pensions and survivors’ lump sums to be moved to 31 December 2006. This means that the consideration of new applications for pensions or survivor’s lump sums after this date will no longer be possible. So, it means that after 31 December 2006 it will no longer be possible to consider any application.
Secondly, the extension of certain benefits to better align with benefits afforded to pensioners and spouses and dependants of pensioners under other pension schemes, taking into consideration particularly equity and also issues of affordability. In this regard, provision is made in the Bill for the following new benefits: Monthly pension for surviving spouses or orphans on the death of a pensioner, which will apply retrospectively from 1 December 1996, and funeral benefits for pensioners, surviving spouses or orphans.
Other amendments provide for the disestablishment of the board 60 days after the lapsing of the provisions providing pensions and survivors’ lump sums on 31 December 2006. The review board will also be disestablished 90 days thereafter. All the administrative parts in as far as these pensions are concerned ought to move to the National Treasury and the Minister has to ensure that the board’s responsibilities are also carried out.
Further, the resolution of administrative and legal difficulties relating to the implementation of this Act is also moved to the National Treasury and appropriate divisions.
The Bill also allows the review board to reconsider and amend a determination made by it under certain circumstances and to recover any pension or benefit to which a person was not entitled. So, I think that one of the things that are in line with some of the steps and initiatives that have been taken, particularly by the Minister of Social Development, is to ensure that concerning those who receive these pensions, who were not supposed to, measures are taken to ensure that such moneys are recovered.
As soon as this Bill is enacted, the National Treasury will embark on an extensive campaign to reach all those who qualify for a special pension who have not as yet applied. We will make every effort to ensure that as far as possible information about special pensions reaches every part of our country, urban and rural, in order for those who qualify for any of these benefits under this Act to apply before the closing date.
In conclusion, I wish to take this opportunity to thank the Portfolio Committee on Finance, especially the chairperson, Mr Nhlanhla Nene, for the manner in which they have handled this amending Bill. I am aware that the committee had to work hard, under extreme pressure of differing kinds, in order to ensure that the House passes this legislation before it rises.
I therefore present the Special Pensions Amendment Bill for consideration and adoption by the House. [Applause.]
Mr N M NENE: Chairperson and hon members, it is difficult to speak after the Deputy Minister as he has covered everything that I wanted to say. I do not know whether I must just reciprocate what he has just said, thank National Treasury and go and sit down.
On 27 June this year this people’s Parliament paid tribute to the architects of this democratic constitutional order by taking the assembly to Kliptown, where a pact was signed and sealed by the people for the people.
IsiZulu-ke sithi umuntu kufanele ahlale ahlale aye emsamo ayoshweleza acele nezinhlanhla koyisemkhulu. [In the Zulu culture a person must perform rituals, communicating a message of asking for good luck.]
That is what we did. The difference between the two events, that is the 1995 drawing up of the People’s Charter and the People’s Assembly this year, was that the one for this year was attended by the then perpetrators of the evil system of apartheid and victims as equals.
The task of achieving this equality was not an easy one. The contribution of the people who put down their lives for this democracy cannot be compensated in monetary terms, as we heard the Deputy Minister say. Nothing will equal their dedication.
The Special Pensions Act passed in 1996 and later amended in 1998, and subsequently in 2003, was intended to provide pension to persons who, because of their involvement in the struggle, were themselves prevented from making provisions for pension.
In pursuit of this noble objective the ANC-led government continues to address some of the unintended omissions in that legislation by putting forward the amendments as outlined in the Bill before this House today.
These amendments take us a step closer to the progressive realisation of the pact we signed 50 years ago, that the people shall be equal before the law and that there shall be security and comfort for all. These freedoms we will fight for, side by side, throughout our lives, until we have won our liberty.
Even though our goal is to build a developmental state that is premised on promoting sustainable livelihoods, it is imperative that an enabling environment is established. A number of amendments create that environment in this Bill, as the Deputy Minister has already explained in his speech.
According to this amending Bill, surviving spouses and orphans of pensioners will now qualify for these benefits, also as outlined in the Deputy Minister’s speech. It also provides for the dissolution of the Special Pensions Review Board by the Minister once it has completed its function in terms of this piece of legislation. He in turn will take full responsibility for the performance of its functions.
In the public hearings that were held the committee listened to submissions from various organisations, among which were a group of former uMkhonto weSizwe members from Pretoria, the Military Veterans Association from KwaZulu-Natal, the Sea Veterans League from the Nelson Mandela Metro region, the Human Rights Media Centre from the Western Cape, the African National Congress from Cradock, the Pan Africanist Congress of Azania, Qibla in the Western Cape and many others.
These organisations raised a number of very important issues, which our report captures in detail and enjoins our government to address as a matter of urgency. The committee is satisfied that our government will not fail us on these matters and we undertake to follow this to its conclusive end.
National Treasury has also assured, as we have heard from the Deputy Minister, that they have set up a formidable team that is going to go all out to ensure that all outstanding potential beneficiaries are brought into the fold.
Public representatives, including members of this House, are urged to assist in the process in their constituencies to mobilise those who might have missed the previous deadline.
My other colleagues will speak on the other aspects of the amending Bill. Allow me now, Chairperson, to thank National Treasury, under the leadership of the Deputy Minister, the committee members and everyone who contributed towards the processing of this Bill, more particularly those who made submissions to the committee.
The committee will consistently monitor the implementation of this Bill and its impact, in the interest of the public, as part of elected public representatives.
The ANC supports this Bill, and I thank you, Chairperson. [Applause.]
Dr S M VAN DYK: Chairperson, the Special Pensions Amendment Bill is an amendment to the original Special Pensions Act of 1996. The purpose is to provide for special pensions to be paid to persons who made sacrifices or served the republic’s interest in the course of establishing a democratic constitutional order in South Africa.
A period of more than eight years has elapsed since the promulgation of the Special Pensions Act on 1 December 1996. The period provided for the applications in terms of the Act is 12 months from the commencement day of the Act. That period expired on 1 December 1997. Subsequent to 1 December 1997, a number of late applications have been condoned in terms of the Act.
The Special Pensions Amendment Bill proposes the lapsing of the provisions providing for the qualification of pensions and survivors’ lump sums on 31 December 2006. This means that the consideration of new applications for pensions or survivors’ lump sums after this date will no longer be possible.
Die bestaande wet bepaal dat ’n persoon wat opgeoffer het en betrokke was by die totstandkoming van ’n demokratiese Suid-Afrika, byvoorbeeld ’n vryheidsvegter van ’n politieke groepering wat vroeër verbode was, kwalifiseer vir ’n pensioen as die lid minstens 35 jaar oud was in Desember 1996 of as die lid vyf jaar voor 2 Februarie 1990 nie vir ’n pensioenfonds kon voorsien nie as gevolg van sy voltydse deelname aan ’n politieke organisasie, in gevangenisskap was of nie vryelik kon rondbeweeg nie, en dat sodanige pensioen van ouderdom 60 betaalbaar is.
Tweedens kwalifiseer soortgelyke persone wat permanent of totaal beroepsongeskik is as resultaat van sy opoffering in die stryd voor Februarie 1990. Derdens sal, by die afsterwe van ’n lid wat kwalifiseer vir pensioen, sy eggenote of afhanklike ’n eenmalige uitbetaling ontvang.
Al wat die wysigingswetsontwerp bepaal, is dat die tydperk vir aansoek verleng word na 31 Desember 2006 en dat die pensioenvoordele vir afhanklikes aangepas word om dit in pas te bring met die voordele van bestaande pensioenfondse, wat onder andere begrafnisvoordele insluit.
Tydens die bespreking van die wysigings tot die wet is verskeie politieke organisasies en voormalige vryheidsvegterassosiasies die geleentheid gebied om die Portefeuljekomitee oor Finansies toe te spreek. Kritiek teen die wet wat uitgespreek is, was onder andere dat die aanvanklike eenjaartydperk vir aansoeke onvoldoende was, dat daar ’n tekort is aan kantore in sekere provinsies waar aansoeke ingedien kan word, dat sekere persone nie oor die logistieke steun beskik om aansoeke behoorlik voor te berei en te finaliseer nie, dat lede wie se aansoeke afgekeur is hulle op eie koste tot die hof moes wend vir hersiening, dat daar voldoende tyd behoort gegee te word vir die suksesvolle navorsing om alle moontlike bevoordeeldes van die pensioenfonds bewus te maak. Verder word daar geredeneer dat 55% van die lede wat in gevangenisskap oorlede is jonger was as 30% en dat daar nie voorsiening gemaak word vir hulle naasbestaandes nie.
Een van die belangrikste argumente was egter die ouderdomsbeperking van 35 jaar in 1996 waaraan lede moes voldoen tydens hulle aansoek. Daar is aangevoer dat baie lede wat aan die pensioenvereistes voldoen het teen 2 Februarie 1990 nog nie 29 jaar oud was nie, en dus nie in 1996 35 jaar oud kon wees toe die wet in werking getree het nie. Ten spyte van al hierdie petisies en betoë het dit by die Parlement op dowe ore geval.
Tans word die fonds deur die Tesourie geadministreer en R1,6 miljard is reeds sedert 1996 bestee, met ’n ekstra R58 miljoen wat vir administratiewe uitgawes aangegaan is. Daar behoort egter rede tot kommer te wees oor die misbruik van hierdie pensioenvoordele indien in berekening gebring word dat net 16 000 van die 36 000 aansoeke goedgekeur is. Behoorlike monitering en administrasie van die fonds is dus van kardinale belang ter beskerming van die belastingbetaler se geld, maar die DA is egter van mening dat die fonds wel goed bestuur word en beskou die amendement as ’n verligting aan bestaande begunstigdes en diegene wat nog nie in die voordele van die fonds kon deel nie.
Die DA steun hierdie wetgewing. Dankie. (Translation of Afrikaans paragraphs follows.)
[The existing Act stipulates that a person who made sacrifices and was involved with the establishment of a democratic South Africa, for instance a freedom fighter from a political group that was banned previously, qualifies for a pension if the member was at least 35 years old in December 1996, or if the member could not make provision for a pension fund in the five years preceding 2 February 1990, owing to his full-time involvement in political organisations, incarceration or inability to move around freely, and that such pension is payable from the age of 60.
Secondly, persons in similar positions who are permanently or wholly unfit for any occupation ensuing from the sacrifices they made during the struggle before 1990 also qualify. Thirdly, the spouse or dependant of a member who qualifies for a pension will receive a once-off payment when the member dies.
The amending Bill merely stipulates that the application period be extended to 31 December 2006, and that the pension benefits for dependants be adjusted to align it with the benefits of existing pension funds, which include funeral benefits.
In the course of the discussion of the amendments to the Act, several political organisations and former associations for freedom fighters were given the opportunity to address the Portfolio Committee on Finance. Criticism that was expressed with regard to the Act included the inadequacy of the initial one-year application period, that in some provinces there was a shortage of offices to hand in applications, that some people did not have the logistical support at their disposal duly to prepare and finalise applications, that members whose applications had been unsuccessful had to resort to court action at their own expense to have it reviewed, and that sufficient time should have been provided for successful research to create an awareness among all possible beneficiaries of the pension fund. Furthermore it is argued that 55% of the members who died in custody were younger than 30, and that no provision had been made for their next of kin.
However, one of the key arguments was the age limit of 35 years in 1996 that members had to satisfy at the time of their application. It has been argued that many members who met the pension requirements had not reached the age of 29 by 2 February 1990, and therefore could not have been 35 years old when the Act came into effect. Despite all these petitions and representations to Parliament, it has fallen on deaf ears.
Currently the fund is administered by the Treasury, and since 1996 R1,6 billion has been spent already, and an additional R58 million for administrative costs. However, there should be cause for concern about the abuse of these pension benefits if it is taken into consideration that only 16 000 of the 36 000 applications were approved. Proper monitoring and administration of the fund are therefore crucial in order to protect the taxpayer’s money. However, the DA is of the opinion that the fund is well managed and views the amendment as some relief for existing beneficiaries and those who have as yet been unable to share in the benefits of the fund.
The DA supports this legislation. Thank you.] Mr T E VEZI: Chair, this Bill seeks to amend the Special Pensions Act of 1966 by providing for the lapsing of Part 1 of the Act, which provides for pensions and survivors’ lump sums up to 31 December 2006. A new part provides for additional benefits to be paid to pensioners, and for the extension of benefits for which surviving spouses and orphans may qualify on the death of the pensioners.
During the hearings concerns were raised around the question of qualification of pensioners who were members of organisations other than the ANC and the PAC. The cut-off age of thirty-five was also a major bone of contention.
During the hearings it also became obvious that in the absence of adequate national research conducted under the leadership of a professional research body, it is not possible to assume that most persons who qualify for a pension in terms of the Act have applied. There are differences of opinion as to what the government should do to alleviate the plight of the under- thirty-fives. One of the view holds that they should be retrained and be reskilled technically, and that the government should create space for them in the economy.
While the government’s intention with the Special Pensions Act was noble, the reality on the ground is different for the under-thirty-fives. It would have been correct if a feasibility study was done on whether or not the under-thirty-fives were indeed going to be absorbed by the economy of the country before the Special Pensions Act was promulgated. That study was, unfortunately, never conducted.
According to the special pensions actuary projections there were about 13 000 under-thirty-fives who were involved in the struggle prior to the 1990 era. When young people joined the liberation movement age was not an issue. Nobody rejected them because they were under age or because they had not reached a certain level of education.
The IFP supports the Bill. [Time expired.]
Ms J L FUBBS: Chairperson, hon members and compatriots, we have today taken one tiny step, but it is a step that takes us further along the progressive realisation of an alternative society; a society which recognises dignity, freedom, nonracialism and nonsexism; a society in which, as our chairperson the hon Dlamini has put it: “We stood together in Kliptown, side by side - those who were formerly the oppressed and those who were formerly the oppressors.” And that marked another step.
Today, this amending Bill - noting that this is now the third amending Bill
- has seen us move further along this route. The current amendment to the Special Pensions Bill is intended as a progressive measure to fulfil the intentions of the principal Act that was passed in 1996.
The historical context of the Special Pensions Bill and the capping of the eligible entry age at thirty-five in 1996 is for many members a challenge they cannot ignore. Many of those who fought for the liberation of our country did not see their youth then as an impediment to service and sacrifice. Yet, from the submissions that we had on the committee, we became, once again, very aware that many of our liberation warriors roam the streets in search of work. We cannot ignore their plight. They are in need.
So we call on our compatriots in government to exercise their minds, once again, and to develop measures, plans and programmes that will reskill those who were the flower of our youth then and still have much to offer. As someone said, “izimbali zethu azisekho.” [Our flowers have wilted.] Give them back their dignity, their honour and prioritise their need. They will surely then, once again, serve their country, giving of their best. Indeed we owe the birth of this, our peaceful, nonracial, nonsexist democracy to them and other like-minded people. And we now enjoy that democracy.
Other things that I wish to say in this regard make us look further than this amending Bill. This particular piece of legislation is simply another milestone we have achieved in the ANC’s path to building a developmental society and nation in which all can play a constructive role. The ANC has never ever adopted what I often term “a microwave approach to reality”, as some parties in this House do, and we would never approach this very, very critical and challenging piece of legislation in that manner.
We have become far too aware of the importance of the achievement of our long-term vision, a vision that was born in 1912. Over the decades this vision has transformed itself strategically so that it addressed issues in the 1940s, the 1950s, 1960s, 1970s, 1980s, 1990s, and now in the twenty- first century. And that is the reason I appeal to those who may believe that they are not fully covered by this amendment that we are aware of the contribution they made. But we also know that when they began that contribution, they did so in the struggle to transform this country. And now we are faced with yet another challenge, and that is to make poverty history.
So, hon members, comrades, colleagues and the Cabinet, let us take cognisance of this plight and let each and every Minister apply his or her mind to this issue so that such comrades, colleagues and friends can make that constructive contribution. Certainly, this cannot remain the sole responsibility of National Treasury; it remains our collective responsibility as the ANC, in and outside government.
I would continue to hold the National Treasury to their firm commitment to conduct a vigorous outreach campaign and rigorous research to ensure the integrity of our data so that all who fit this Bill can be addressed. I thank you, comrades, colleagues and hon members.
The ANC fully supports this Bill. Thank you. [Applause.]
Mr A HARDING: Madam Chair, the Special Pensions Amendment Bill is but one way whereby this government could extend its gratitude to all of those who have given so much, including their lives, for this country. And we must reward them properly and not only meet them halfway.
The ID therefore supports the amendments made to this Special Pensions Amendment Bill that provides for financial assistance to surviving spouses and orphans, including a funeral cover.
It is imperative that the board and the review board are not disbanded before all work is completed. Furthermore, we call for the special pensions offer to be strengthened so as to speed up payments of these benefits.
This amending Bill goes further in restoring the dignity of those who suffered injustices in the past. I thank you. [Applause.]
Mr S N SWART: Chair, the ACDP supports the Bill and holds the view that ample time has been allowed for applications for such pensions. According to the memorandum, it is assumed that most persons that qualified for a pension in terms of the Act would have applied in the extended period.
The extension of the period for applications is no longer prudent because of the risk of fraudulent claims. The Special Pensions Fund is by its very nature vulnerable to fraud and false applications. And the risk is increasing as a result of lack of information and difficulties in the verification of information owing to time lapses since 1996.
As it is, there has been a large number of applicants who did not qualify, for various reasons. Of the 36 000 applications over nine years, there were 15 700 beneficiaries.
The ACDP also notes that National Treasury is investigating a number of fraudulent claims and that there are court cases in the Eastern Cape where people have been charged for fraudulently benefiting from the fund. But, we as the ACDP will support this amending Bill. I thank you.
Mr M T LIKOTSI: Chairperson, the clause that deals with the date for the lapsing of this Bill, before all the problems encountered by the applicants are solved, will disadvantage scores of deserving people who are battling to get their special pension gratuity.
The Minister must intervene as the board and the review board are failing to resolve some of these problems. The Minister must not use the excuse of fraudulent claims in placing a cut-off date, but should manage these claims.
The PAC does not condone fraudulent claims by nondeserving people and urges all who are involved to stop immediately.
In December 1996, when this Act was promulgated, it excluded many young freedom fighters who were then below the age of thirty-five, as well as the political prisoners and those that were kicked out of the integration process owing to many factors.
Our members who were involved in the liberation struggle and took demobilisation packages have no monthly income that may sustain them for the rest of their lives. This is an oversight on the side of this Bill.
The PAC does not support this Bill. [Time expired.]
Ms S RAJBALLY: Chairperson, the MF supports the amendments made with regard to the lapsing of the pensions and survivors’ lump sums. Secondly, the provisions made in respect of special pension benefits, lump sum benefits, monthly pensions and funeral benefits for surviving spouses and orphans are adequate.
The procedures provided for the repayment of benefits to which a person was not entitled are appreciated, as these will provide clarity as to how matters of this nature are dealt with. As for the transfer of authority and the disestablishment of the review board, the MF thanks the board for its service and wishes the National Treasury and the Minister well in administering this sector.
The MF is especially happy that the Bill makes provision for resolution of administrative and legal difficulties, as well as other technical and consequential amendments. The MF supports the Special Pensions Amendment Bill. Thank you.
Mr P J NEFOLOVHODWE: Chairperson, when this special pension idea was mooted it was very clear that the provisions were to provide special pensions for persons who made sacrifices by engaging in activities intended to establish a new and democratic constitutional order.
At the same time, not all of those who sacrificed their lives in establishing this order are benefiting from special pensions. These are cadres who, on the basis of age, are excluded. Those cadres cannot understand why age did not count when they joined the liberation forces, but that age is now a determinant as to who qualifies for benefits from special pensions. The matter of the under-thirty-fives should be attended to urgently.
Azapo knows that many apartheid criminals are continuing to benefit from the new democratic order, as indeed are some parliamentarians who were part and parcel of that order. Therefore, Azapo argues that the matter of the under-thirty-fives should be attended to urgently. Thank you.
Mr L S GABELA: Chairperson, my remarks this morning are dedicated to the youth of the eighties, especially O R Tambo’s young lions. I want to start off by correcting the public misconception, as evidenced in the majority of submissions that were received by the committee, that the Bill had mostly to do with the issue related to the age limit. The fact is that there are other issues. My colleagues referred to them earlier during this debate.
We also need to state that this Bill is not intended to address issues that affect only the PAC, the ANC and Azapo, but to address issues affecting other formations as well, in keeping with the terms of criteria to qualify.
My contribution to this matter under consideration is mainly guided by the recent ANC National General Council deliberations on social security, with particular reference to the issue of the under-thirty-fives as an area of focus.
I am mindful of the fact that the Bill dealt with issues relating to surviving spouses, to issues relating to problems faced by orphans and so on, including issues relating to funeral benefits for pensioners.
Iphuzu elithinta labo abangakwazanga ukungena ohlelweni lwempesheni ekhethekile ngoba nakhu kuthiwa babezingane ngalesi sikhathi alikaxazululeki. Laba abantu abanikele ngakho konke abanakho empilweni yabo ukuze leli zwe likhululeke size sifike lapho sikhona namhlanje. Abanye babo bahlala isikhathi besemajele bengathwesiwe amacala. Abanye babehlezi belindele ukuthi bazogwetshwa kanti abanye bagcina sebegwetshiwe ngokunjalo. Kukhona abanye nje engingakhuluma ngabo njengoqabane uPhuthumile Ndlabathi waseMdantsane owahlala isikhathi elindele isigwebo sentambo.
Emuva kokuthi esefake isicelo sempesheni ekhethekile, wenqatshelwa kwathiwa akwazi ukungena ngoba iminyaka yakhe ingaphansi kwengama-35. Emuva kwaleso sehlakalo, kwaba neshwa lokuthi abone ukuthi kwakuphila akusamfanele ngaleyo ndlela wagcina esethathe impilo yakhe. Baningi abanye othwebula bakithi abangaphansi kwesimo esifana naleso. Izimo abaphila ngaphansi kwazo okuba zinhloni nanokukhuluma ngazo.
Ngikhuluma lapha nanangokuthi abanye uma bekhuluma noma sebeqhanisa isimo samanje nesimo salabo ababehambele impi yesibili yomhlaba siba yihlazo. Omunye nje osemncane engingakhuluma ngaye u-S V Sako waseTinarha naye ongazange akwazi ukuthi avunyelwe ukuthola lokho okufanele ngoba nakhu esemncane, kodwa wahlala isikhathi eside elindele ukuthi aquliswe icala. Emuva kwalokho wahlala cishe iminyaka emine nangaphezulu elindele isigwebo sentambo kodwa uma esefaka isicelo kwaba ukuthi akufanele lokho.
Ngisebenzisa leli thuba-ke ukuthi ngithi ngaphambi kokuthi kuqale ukuthi kukhulunywe ngale nto, kunesivumelwano le Ndlu evumelane ngaso okuyisivumelwano esibe sekomidini futhi osekuyisinqumo njengoba ngikhuluma nje sePhalemende. Lesi sivumelwano sithi kufanele iKhabhinethi ithathe isinqumo bese yenza umsebenzi wokuxazulula inkinga yala bantu abangakwazi ukungena ohlelweni lwempesheni ekhethekile ngoba bezingane. Lesi sinqumo esisithathe namhlanje sithi kufanele kube khona umbiko ozbuya uze lapha ePhalamende zingakapheli izinyanga eziyisithupha. Ngaphezu kwalokho, ikomidi elibhekene nodaba lwezimali lapha ePhalamende selizinikele ekutheni njalo emuva kwezinyanga ezintathu labo abanikezwe umsebenzi wokubheka izimali zaleli zwe lizobabiza ukuthi bazochaza, futhi bakwazi ukubika ngokuthi umsebenzi wokuphathwa kwalo Mthetho uhamba kanjani ngoba ziningi izinkinga esezibe khona kusukela ngo-1996 ebesilokhu sibhekana nazo.
Kufanele kuhlangane isigungu esikhulu ngokunjalo nePhalamende ukuze kubanjiswane ekutheni kuxazululwe lezi zinkinga esibhekene nazo. Siyazi ukuthi ihhovisi elikhulu elibhekene nalo msebenzi ebelikade likwenza belikwenza ngoba nakhu kulawula umthetho ukuthi makube njalo. Kuwumsebenzi wethu-ke nesigungu esikhulu sibambisene ukuthi sizixazulule lezi zinkinga. Sibonga kakhulu kulaba abafike ekomidini, ikakhulukazi umphakathi ukuthi ukwazi ukuzozwakalisa ilaka lawo ngala maphuzu lawa afana nalawa. Lezi zinkinga sinethemba lokuthi zizoxazululeka. Ngiyabonga. [Ihlombe.] (Translation of Zulu paragraphs follows.)
[The point concerning those who did not qualify for a special pension because they were too young has not yet been solved. These people gave all they had in their lives so that this country would be free and where we are today. Some of them were detained without trial. Some of them were waiting to be sentenced and some were finally sentenced. There are others like comrade Phuthumile Ndlabathi, who waited a long time in anticipation of a death sentence.
After applying for a special pension, his application was refused on the grounds that he was under the age of 35. After that incident he reached the point where he felt that it was not worth living and he committed suicide. There are many people who are in the same situation. You feel ashamed to talk about the conditions they are living in.
It’s a shame when they talk or compare the present situation with that of those who participated in World War II. The other person is S V Sako of Tinarha, who was not allowed to get what he deserved on the grounds that he was too young, although he waited a long time before he was brought to trial. After that, he had to wait four years in anticipation of a death sentence. When he submitted his application, he was told that he did not deserve it.
Before we tackle the issue, I want to use this opportunity to say that there is an agreement by this House, which was discussed in the committee and now, even as I speak, becomes a decision by Parliament that the Cabinet must take a decision and solve the problem with regard to these people who do not qualify for the special pension because they are too young. The decision that we took today requires that the committee must report back to Parliament within six months. Furthermore, the finance committee of Parliament has committed itself that every three months those who are responsible for the finances of the country will be called to explain and report back on the implementation of this Act. There are a lot of problems that we have come across since 1996.
The executive committee must meet and work hand in hand with Parliament to solve these problems that we are facing. We know that the national office doing this work has been doing it because that is what the law requires. It is our responsibility, and that of the executive committee, to work together to solve these problems. We thank those who appeared before this committee, particularly the public who came here and voiced their opinions concerning these points. We hope that these problems are going to be solved. Thank you. [Applause.]]
The DEPUTY MINISTER OF FINANCE: Madam Chairperson, one of the key issues that has been raised in the debate is the plight of those who do not meet the criteria, as stated in the Act. Quite obviously, this is a matter that, to a large extent, bothers and also touches the hearts of a number of us in this House today.
Just to go back: it was the same matter, when the Bill was passed in 1996, around which a then hon member, Zingile Dingani, who is currently the Secretary to Parliament, raised concerns. I would like to quote him, just to indicate that this is an issue that has been raised and an issue that indeed needs immediate attention. He said the following, and I quote:
During deliberations on this Bill, the issue of people under the age of thirty-five, who made tremendous sacrifices during the struggle for democracy was discussed, and members of the House expressed an opinion that government should investigate ways and means of empowering these people.
The same issue was taken up by the then hon member Mandisi Mpahlwa, who is currently the Minister of Trade and Industry. He also had this to say about the matter, that: “It needed immediate attention.” Quite obviously, the matter has been raised, and basically continues to be raised by a number of members. I would like to acknowledge that it is about time that it received attention.
However, I’d also like to say to hon member Likotsi, from the PAC, that it is quite surprising that the member of the PAC then, the late Gora Ibrahim, supported the Bill when it was passed in 1996, including its amendment in
- I am not sure whether there has been a change of heart in so far as the principles of the Act are concerned.
I understand the issue that is being raised by the hon member, but the important thing is what the PAC has consistently said. You can check the Hansard of 10 September 1998 and also that of 16 October 1996, in which the PAC said that it’s important to have a principled stand, and that we cannot shift stands on issues that are being deliberated upon. I would invite the hon member to read a very eloquent and deliberate speech by the late hon member Gora Ibrahim, and I direct you to the Hansard of October 1996 and also that of September 1998.
Lastly, I would like to thank the members for the debate. Quite obviously, the majority of the parties support the Bill, even though they have raised the issue of the under-thirty-fives. I would like to thank them for that, and also to indicate that, as indicated in the committee report, Treasury will indeed do everything to ensure that the issues of the under-thirty- fives are taken care of. Thank you. [Applause.]
Debate concluded.
Bill read a second time (Pan Africanist Congress of Azania dissenting).
AUDITING PROFESSION BILL
(Second Reading debate)
The DEPUTY MINISTER OF FINANCE: Madam Chairperson and hon members, to attain growth levels of 6% and above, it becomes critical for South Africa to ensure macroeconomic stability that is underpinned by an ethical business environment. This stable and transparent business environment plays an important part in generating both investor and consumer confidence. Hence measures to limit business failures and unethical behaviour are necessary ingredients to sustaining growth both in the developing and underdeveloped countries.
The failure or collapse of a business can have a major effect as recently experienced not just in South Africa, but also in the United States of America, Europe and other parts of the world. These failures impact on the economy in general, specifically on workers or investors who have worked and invested in the businesses confronting failure.
It would, therefore, be prudent to minimise and, where possible, to eliminate such losses. This indeed underlines the important role that auditors play in assuring investors, whose savings are risked in these businesses, that indeed their savings are well looked after.
The world, as you all know, has recently seen a whole range of corporate failures of such devastating proportions that the question of protecting public interest features quite prominently in most governments’ regulatory reforms. Part of the reasons these corporate failures materialise relate to what Joseph Stiglitz, a known economist, terms the “natural asymmetries of information”. In simple terms it means that there are those who have information that others do not have.
Professions such as the auditing profession emerge basically to close the gap between those who have information and those who do not seem to have information.
The list of the best-selling books in recent times is littered with tales of how the greedy actions of a few have had grave consequences not just for individual investors, but also for the world economy. The effect of these actions has been the collapse of pension funds, job losses, financial market disruptions, government bail-outs, etc. These events serve to underscore the importance of the role of auditors in protecting what we all refer to as “public interest”.
Since the amendment of the Public Accountants’ and Auditors’ Act in 1991, the challenge has been how the auditing profession reforms itself in order to ensure its relevance now and in future. However, the process has been quite slow. Corporate failures such as those of Enron, Parmalat, Masterbond, Regal and Saambou gave renewed urgency to the conclusion of these reforms, particularly those relating to issues of governance of the profession.
One of the lessons learned from these failures is that corporate governance dispensations applied were either irrelevant or inadequate. A need for an effective regulation is indeed quite apparent.
To go back, once again, to Joseph Stiglitz, who accepts that accuracy of information could not always be assured, but at least incentives could be aligned. Equity options distort managerial incentives while consulting distorts auditors’ incentives. Ineffective liability provisions in legislation also do not seem to help the situation.
One of the important elements that underpin good governance, particularly good corporate governance, is the independence and accountability of auditors. An impression is often created that auditors’ accountability is primarily to directors of the audit clients. We know that nothing could be further from the truth. Shareholders are indeed the ones who appoint auditors.
The financial statements on which the auditors express an opinion are used by a variety of stakeholders whose interest in these statements is direct and unambiguous. These stakeholders include shareholders or investors, and pension fund members who are interested in substantial returns.
Stakeholders also include creditors interested primarily in receiving moneys due to them, employees interested in job security, and, last but not least, government interested in receiving fare taxes, creating jobs, ensuring equity, economic growth, attracting investments, etc.
The aftermath of the corporate failures referred to earlier reflects the magnitude of the responsibilities the auditors have towards a wide group of stakeholders. A survey conducted by MORI for the Accountancy Foundation in the United Kingdom revealed the following:
Firstly, 65% of auditors thought that the quest for lucrative consulting work had made audit a loss leader; secondly, 62% of auditors believed that their independence had been impaired, at least to some degree, by the desire to gain lucrative nonaudit work. And lastly, 83% of companies thought that auditors’ independence had been impaired by the quest for lucrative nonaudit work. These developments compromised the effectiveness of self-regulation, a cause for concern for regulators.
While the objective of the current piece of legislation is to protect public interest, it still lacks effectiveness in ensuring the independence of the regulatory institution and the accountability of auditors.
The Bill currently before Parliament focuses on the creation of a framework for the regulation of registered auditors, as opposed to imposing a set of rules. It also seeks to enhance the independence of the regulatory board and its effectiveness and to provide the regulatory board with sufficient powers to carry out its duties. It seeks to ensure that auditors recognise their primary role of protecting the public interest.
The objectives of the Bill are as follows: Firstly, to contribute towards the protection of the public interest in the Republic of South Africa in respect of services rendered by registered auditors; secondly, to establish an independent regulatory board for auditors that must ensure that every registered auditor in South Africa is appropriately qualified and is held accountable for his or her professional conduct; thirdly, to adhere to ethical practices and the implementation of standards comparable to international standards; fourthly, to ensure that a person or a firm offering audit services or services of a public accountant must be registered with, and be subject to, the jurisdiction of an independent regulatory board for auditors; fifthly, to ensure that all disciplinary proceedings brought against a registered auditor by the independent regulatory board for auditors are conducted by independent persons, suitably skilled and qualified to ensure a fair hearing and an appropriate sanction for any wrong doing by auditors; and lastly, that the government of the Republic of South Africa, represented by the National Treasury, should perform an oversight function with regard to the operations, decisions and objectives of the independent regulatory board for auditors.
Thus, the intention of the Bill before us, hon members, is to ensure that auditors conduct themselves in a manner befitting the enormity of their responsibilities. It seeks to ensure that they exercise their duties with independence and are also accountable for their actions. It provides a modern framework of regulation that gives credence to the objective of protecting public interest.
I therefore present the Auditing Profession Bill for your consideration. I thank you. [Applause.]
Mr K A MOLOTO: Chairperson and hon members, we recently witnessed major domestic and international corporate failures. These corporate failures have focused the attention of the public on the conduct and independence of auditors. Workers’ pension funds and thousands of small investors have suffered serious losses as a result of these corporate failures.
The public questions the appropriateness of the current South African regulatory regime for auditors. This Bill aims to provide an answer to that question through introducing a comprehensive framework for regulating the audit profession.
The public has a right to pose that critical question because of a correct, widely held view that auditors have an overriding duty to protect public interests and to maintain total independence from their audit clients.
The collapse of the Masterbond Group of Companies in South Africa in the early 1990s raised serious concerns about the lack of auditor independence in relation to their clients. Thousands of pensioners were left destitute as a result of this collapse. The Nel Commission in the Masterbond case made certain critical observations. The commission observed that the auditors involved in these cases saw their role as being to assist and protect the management of companies, as far as possible.
The commission went on to cite specific examples of gross irregularities committed by auditors involved in this case. The auditors in question signed unqualified reports relating to blatantly forged financial statements; they drafted and signed financial statements, which departed so fundamentally from generally accepted accounting practice that no relevance could be placed thereon. They assisted in misleading the Receiver of Revenue and they also changed accounting policies to convert loss situations into profit without proper disclosures.
Investment billionaire Warren Buffet, who belongs to the breed of speculators who I sometimes dislike, had this to say about auditors: “Though auditors should regard the investing public as their client, they tend to kow-tow instead to managers who choose them and dole out their pay.”
He goes on to reinforce his argument on the attitude of auditors by quoting a proverb: “Whose bread I eat, his song I sing.” Obviously, it is inappropriate for auditors to sing the song of management. They have to protect the public interest.
Therefore, hon members, the regulation of auditors is a matter of public interest. In some cases auditors have been accused of turning a blind eye to financial fraud committed by management of companies. The proverb that Warren Buffet quotes reminds us of the need to keep an eye on the independence of auditors. It is common cause that big, international accounting firms make most of their money from offering their clients various advisory services than from audit fees.
According to the Geneva Report on the world economy entitled, Conflict of interests in the financial services industry, audit fee revenue for the big six did not rise significantly from 1994 to 1996. There was a major increase in revenue, however, from consulting and management advisory services. This raises serious concerns on the possibility of serious conflict of interests.
The report goes on to highlight an interesting development. It indicates that until the early 1980s the audit firms’ management, partners, governance structures and the profitability of the firms’ division were clearly dominated by the audit side. However, power within the firms began to change as consulting business started to realise huge growth in revenue while audit profits remained under pressure.
We have to take note of the fact that the post-Enron environment put pressure on audit firms to deal effectively with the inherent conflict of interests. According to the publication I’ve already cited, the audit and consulting partners of Arthur Andersen fought publicly about power - and profit sharing. Those internal conflicts ended up in court and resulted in the split of the auditing and consulting services of Arthur Andersen. PWC and Ernst & Young sold their consulting business to eliminate potential and related conflicts of interests.
The Bill merely reinforces the international trend by insisting that the partners of an auditing firm should consist only of auditors. The Bill states that it is a punishable offence for an auditor to turn a blind eye to financial irregularities occurring in a firm that he or she is auditing. The auditor is compelled by this Bill to report material and financial irregularities with the independent regulatory board. Failure to report such irregularity is an offence.
If the auditor is convicted, he or she is liable to a fine or imprisonment for a term not exceeding 10 years or both a fine and such imprisonment. There are some who might perceive the punishment to be too harsh, but the Nel Commission report indicates otherwise.
Owing to time constraints, I will have to move to other issues.
Let us realise that financial fraud and misrepresentation of financial statements are harmful to any economy. They are detrimental to the financial security of workers, their pensions and the interests of investors. The strength of any stock exchange in any part of the world rests on the credibility of the financial statement of the listed companies.
Investment decisions by owners of capital are made on the basis of the financial statement of the listed companies. Therefore engaging in creative accounting practices to make the books look good has far-reaching and disastrous consequences for all stakeholders in the economy. Hiding debts to make revenue look better, overstating sales and pushing off costs on financial statements in order to effect corporate earnings is a harmful practice. Thank you. [Time expired.] [Applause.]
Dr S M VAN DYK: Madam Chair, auditors are important stakeholders in the accountability and governance chain, so continuous efforts are being made to ensure that the profession is able to perform its role better.
However, what exactly is the role and why is it essential to the functioning of our economy? The question is: What, indeed, is the meaning and value of an audit?
The purpose of this Bill is to provide for the establishment of an independent regulatory board for auditors; to provide for the education, training and professional development of auditors; to provide for the accreditation of professional bodies; to provide for the registration of auditors, and to regulate the conduct of registered auditors.
When the draft Auditing Profession Bill was made public in December 2004, the danger of a compulsory auditing regime across all companies was plain for all to see. The new Auditing Profession Act will significantly change the audit landscape from the regime of self-regulation to one that will elevate South Africa to parity to what is happening elsewhere in the world.
The question arises as to who is responsible for negligence in corporate governance. Some auditors might be involved in the signing off of accounts that were horribly far from the truth. Furthermore, executives of certain companies were the key drivers of fraud and corruption.
Dan kan dit ook gebeur dat amptenare in a bepaalde firma korrup is, en dit is juis gebeure elders in die wêreld wat aanleiding gegee het tot dié strenger wetgewing in Suid-Afrika om die ouditfunksie van firma’s waarby daar ‘n openbare belang is, daadwerklik te reguleer. (Translation of Afrikaans paragraph follows.)
[It may very well also be that officials of a certain company are corrupt, and it is precisely events elsewhere in the world that have prompted this stricter legislation in South Africa in order to actively regulate the auditing function of companies where there is public interest.]
The corporate world was shocked by the disclosure of US telecommunications giant WorldCom in 2002 that company officials had misstated accounting figures to the amount of almost US$4 billion. Then there are also the financial irregularities at the Italy-based dairy foods company, Parmalat; the collapse of US energy giant, Enron; HIH Insurance company in Australia; and recent South African corporate disasters, such as the Regal Treasury Bank, Macmed, Saambou and Unifer.
Since the Enron debacle in the US, followed by many others, lawmakers have taken extraordinary steps to enforce the corporate governance as seen, perhaps most dramatically, in the US Sarbanes-Oxley legislation, the so- called Public Company Accounting Reform and Investor Protection Act.
Regulators and standard-setters around the world have spent a lot of time, since the failures of world companies, thinking about how to revamp their financial reporting and corporate governance regimes. According to the European Corporate Governance Institute, 28 countries recently published governance codes or recommended best practices. And this is exactly the purpose of this regulatory board: To protect the interests of the public out there.
Auditors are appointed by the clients, but the reporting responsibility is to shareholders and possibly, beyond that, prospective investors and other stakeholders, thus the public.
Met die ondergang van ‘n maatskappy is dit nie net die aandeelhouers wat groot skade ly nie, maar ook werkgeleenthede wat tot niet gaan tot nadeel van die ekonomie deurdat subkontrakteurs, wat bydra tot die firma en dienste verrig, asook uitsette aan leweransiers, wat ‘n bydra lewer tot die betrokke firma se produksie, verlore gaan. Dan moet ook nog in berekening gebring word investering en ‘n verlies aan kapitaal van beleggers in die firma.
Daarom is dit so belangrik dat enige instelling of individu wat enige belang sou hê by ‘n spesifieke maatskappy ten alle tye ingelig behoort te wees oor die likwiditeit en finansiële posisie van daardie firma. Die sleutelwoord is dus versekering. Wanneer ‘n lid van die publiek staatmaak op inligting moet hy vertroue hê in die betroubaarheid van daardie ouditverslag.
Oor die algemeen beskou is dié wetsontwerp ‘n noodsaaklikheid in die lig van gebeure wêreldwyd en ook moontlike gebeure in ons eie land. Die DA is van mening dat dié wetsontwerp sal bydra tot die ordelike, gedissiplineerde en professionele funksionering van die ouditpraktyk in Suid-Afrika, ter beskerming van die openbare en private belang, en tot die ekonomie in die algemeen. Die DA ondersteun hierdie wetsontwerp. Dankie, Voorsitter. [Applous.] (Translation of Afrikaans paragraphs follows.)
[It is not only the shareholders who suffer great losses when a company fails, but job opportunities also cease to exist to the detriment of the economy through the loss of sub-contractors that contribute to a company and render services, as well as deliveries to suppliers that contribute to the production of the company in question. Furthermore, investment and the loss of capital for investors in a company should also be taken into account.
It is therefore so important for any institution or individual who holds any stake in a certain company to be informed at all times of the liquidity and financial position of that company. The key word therefore is assurance. When a member of the public relies on information, he must have confidence in the soundness of that audit report.
Generally speaking, this Bill is a necessity in view of events worldwide as well as possible events in our own country. The DA is of the opinion that this Bill will contribute to the orderly, disciplined and professional functioning of the auditing practice in South Africa by safeguarding public and private interests, as well as to the economy in general. The DA supports this Bill. Thank you, Chairperson. [Applause.]]
Mr T E VEZI: Madam Chair, the failures of numerous companies, both internationally and in South Africa, have raised concerns regarding the independence and conduct of auditors. In light of these failures, countries around the world have taken legislative action to introduce stringent requirements for the conduct and discipline of auditors.
The Bill must be read together with the Companies Amendment Bill of 2005, which is still to be introduced. The Companies Amendment Bill entrenches and safeguards the independence of auditors in the corporate environment. The Bill prescribes the practice of the auditing profession and liability of registered auditors.
It further imposes a general obligation on registered auditors to report on irregularities that they detect in performing their work. The Bill gives the regulatory board authority to inspect or review the practice of a registered auditor and to investigate charges of improper conduct.
The disciplinary committee is empowered to subpoena any person to give material information concerning the subject of a hearing and to question witnesses. Section 22 of the Constitution allows for the profession of auditing to be regulated and reasonably restricted by law.
Currently, registered accountants would also not be excluded from the application of the Bill. The IFP supports the Bill. Thank you.
Mr M JOHNSON: Chairperson, Deputy Minister, hon members of Parliament, Treasury team, comrades and friends, allow me to dedicate this Bill to the marginalised, the workers and the illiterate, who continue to be the victims of malpractice by unscrupulous companies that unashamedly value profits more than the manufacturers of such.
I do so in order to draw the attention of this august House to the need for these marginalised people to find their own space and physically represent themselves and their views in such public hearings. As stated in this Bill, no single representative of the marginalised was interested or given such an opportunity to present his or her views.
As we draw closer to the year-end of the mobilisation towards the realisation of the goals of the Freedom Charter, we are tasked to regulate one of the important areas of our economy, that is auditing. This we do in order to professionally audit work created by the working class of our country.
The main object of this Bill is to introduce a more comprehensive and modern legislative framework for the regulation of the auditing profession. We are asked to do so because of the circumstances auditors found themselves in, as well as the big companies mentioned earlier.
The regulation of the industry, together with training and accreditation, left much to be desired as the industry continued unabated to be a player and a referee, on a number of areas mentioned here and below, by being less accountable. Garth Coppin of Ernst and Young has the following to say about the background against which our South African companies operated:
Those who have been in business for a while in SA have witnessed many changes in recent years. These are probably some who hanker back to the 1980s when companies could, in terms of section 15(a) of the Companies Act, persuade the government that they should be exempt from providing certain disclosures in their financial statements about their trading activities.
This was also the time when banks and insurance companies were also exempt from providing many of the disclosures required in terms of the fourth schedule of the Companies Act, on the premise that providing this information could undermine confidence in our financial markets.
The auditing profession remains one of the areas in which the apartheid legacy is still felt to a great extent. Of the 4 500 auditors, only 457 constitute black professionals.
The means of examination, in accordance with prescribed or applicable auditing standards, become a narrow definition of “audit”, recognising the strict financial variables aimed at expressing an opinion over a set of provided information.
This has undoubtedly come as a colliding factor in the industry as multidisciplinary institutions continued at pains to justify their operations, especially as they relate to the taking of responsibility on any reported or any other irregularity. Coppin explains this matter further, and I quote:
At that time, the focus on reporting was on providing annual financial statements to shareholders. Since then, there has been a change in emphasis, influenced by the release of the two King reports, which emphasised that companies are not only accountable to stakeholders, but to other parties as well.
The recent experiences of corporate disasters all point to a need for creating an independent and vigilant oversight body for the auditing profession. In line with this view, a nonexecutive and nonindustry-led regulatory board is in keeping with the assertion that there is a need for this independent board, which takes on board some of the members within the industry.
Whilst we maintain an independent regulatory board, standards must not for once be compromised. Clause 4(c) reinforces this point by prescribing the standards of professional competence, ethics and conduct of registered auditors. Part of this is accreditation, registration, renewal and re- registration of members in the profession.
As part of holding the industry responsible, the individual registered auditors and companies respectively take charge of their actions in leading and/or misleading their clients. This must send a message to the big auditing firms that might wish to continue diversifying in noncore auditing areas of work at the expense of smaller and largely black auditing firms. Once again, our intention is to protect and promote the cause of the marginalised, whilst recognising the continued role played by the big players in the industry.
In conclusion, in supporting this Bill, we draw Parliament’s attention to the need to be a vigilant champion of the rights of workers and the illiterate. The ANC supports this Bill, Bill 31 of 2005, on this day, 11 November 2005. [Applause.]
Mr S N SWART: Chairperson, the independence and conduct of auditors have been highlighted internationally following the failure of numerous companies, both internationally and in South Africa, as pointed out by the speakers. We have Enron, Masterbond and Saambou.
It is interesting that auditors have always been in the uncomfortable position of having to judge the financial integrity of the companies that pay them. The evidence in the final Nel Commission Report on Masterbond did not do the audit industry credit. On the contrary, it provided proof of dishonesty, collusion with management and lack of independence because of nonaudit services that were rendered to audit clients.
The lapses and conflicts of other spectacular company failures, such as the auditors’ role in Enron and Saambou, have also been pointed out and are equally glaring. Therefore, there is a need, and there is no doubt that there is this need, to enforce corporate governance regimes as pointed out by the speakers.
The ACDP supports the introduction of stringent requirements for the conduct and discipline of auditors who are there, as has been pointed out, to protect the public interest. We will support this Bill, which we trust will enhance auditors’ independence whilst holding them accountable for their conduct. I thank you. [Time expired.]
Mr N T GODI: Madam Chairperson, comrades and hon members, the PAC supports this Bill. To us the Bill is part and parcel of the process of replacing old legislation with more progressive legislation, or updating our legislation with the requirements and realities of our ever-changing global village.
We, as a country, cannot be oblivious to the scandals and havoc that have wrecked other countries in recent years. It is only proper that preventative measures be taken in the public interest, but also in the interest of business itself and financial institutions.
The regulatory regime and framework, in the view of the PAC, give guarantee that auditing ethics and standards can be maintained, promoted and developed. Of course, ethics and standards must be maintained voluntarily, otherwise sanctions must be imposed.
The PAC is convinced that the outcry from some in the auditing profession is without justification. It is a disguised longing for an absence of responsibility and accountability for their work. State regulation is the way to go. We are not for a minimalist state in matters of public interest. Thank you. [Time expired.]
Ms S RAJBALLY: Chairperson, noting the importance of an auditing function to ensure efficient and effective management of business, public entities and government departments, through the examination of all financial records and documents, the MF welcomes this Bill to manage the auditing sector. Also, the Bill will keep us abreast of international trends. The MF acknowledges the need for the independence of the auditing sector, but also finds this Bill necessary.
Further, with corruption being a serious factor in South Africa, we find that this extension of the long arm of the law will encourage the efficient and effective management of the sector in a law-abiding manner.
The Bill appears to provide efficiently for the accreditation and registration of auditors. The provisions regarding the conduct and liability of auditors will provide proper guidelines for auditors to follow.
We are confident that the independent regulatory board shall oversee this sector well. The MF is also pleased that clarity is also provided for . . .
The HOUSE CHAIRPERSON(Ms C-S Botha): Hon member, your time has expired.
Ms S RAJBALLY: We support the Bill.
Mr S E ASIYA: Hon Chairperson, as has been stated by my colleagues, the Bill provides for the following: Firstly, the establishment of the independent regulatory board for auditors; secondly, the education, training and professional development of registered auditors; thirdly, the accreditation of professional bodies; fourthly, registration of auditors and; fifthly, the regulation of the conduct of registered auditors.
However, the primary objective is to restore the integrity of the auditing profession, which is at a low ebb. This is due to the widespread business failure nationally and internationally, resulting in the honesty of auditors being questioned on their reporting on the true performance of companies, and on several occasions on their ability to identify fraudulent activities. As was pointed out by my colleagues, on a number of occasions these practices have resulted in a crisis of confidence in capital markets both internationally and nationally. Examples were given to illustrate this point.
In order restore the confidence of investors and shareholders, the Minister has ushered in the Auditing Profession Bill to rescue the industry and the profession. This Bill, in the main, is a regulatory framework for monitoring and evaluating the activities of this profession.
It is not a new phenomenon for the profession to be regulated as this Bill seeks to repeal the Public Accountants’ and Auditors’ Act of 1991. However, this Bill is a more comprehensive and modern legislative framework for overseeing and regulating the auditing profession.
In the finance committee concerns were raised, including why more than 40% of the members of the regulatory board should not be registered auditors as stated in clause 11(4). It was reported that the 40% requirement is in accordance with international best practice. The constituent element of the practising auditors should constitute a minority of members. For example, the UK auditing practice board provides 40% of the members, who are practising auditors. Members of the auditing industry should not be allowed to monitor themselves.
Appointment to the board will be based on qualifications, knowledge and experience. For example, the chairperson should be a judge or a retired auditor or academic. Members of the Johannesburg Stock Exchange will occupy a position on the board. It was also a question of whether clause 41(1) of the Bill infringes on the right to choose one’s profession, occupation or trade freely in terms of section 22 of the Constitution. Legal opinion was obtained from state law advisers and parliamentary law advisers, and it was proven beyond any reasonable doubt that this clause is not unconstitutional.
It is a known fact that this profession is dominated by the historically advantaged sections of our society. Very few blacks, and African scholars in particular, have entered this profession. Now, tracing the history of the auditing profession, we found out that the regulation measures were first introduced in South Africa 50 years ago, when we adopted the Freedom Charter, and stated that, All South Africans, black and white, should have equal opportunity to determine the destiny of the republic.
Remember the Job Reservation Act and Verwoerd’s Bantu Education policy, which denied blacks, and Africans in particular, the opportunity to study mathematics and science as it was believed that these subjects were beyond their comprehension. Hence the profession is overwhelmingly dominated by the historically advantaged section of our society.
This Bill, I believe, attempts to address these imbalances as it provides for the establishment and administering of an education fund for purposes of education, training and professional development of registered auditors and students in the auditing profession. This is a huge challenge. Madam Chair, we, as the ANC, support this Bill. Thank you. [Time expired.] [Applause.]
The DEPUTY MINISTER OF FINANCE: Hon Chairperson, one of the good things about the discussions today - I will not say debates because we did not really have a debate - is the fact that all of us in this House agree across political parties, which I think is a very important message to send, not just to business in South Africa, but also internationally, about the position and responsibilities exercised by members of this House to ensure that yes, indeed, public interest is safeguarded.
This is also an indication that we, as South Africans, are learning from the failures of our companies and from the public and international experiences around the handling of these matters. I would like to thank the members for the message that we are sending as South Africans, particularly as members of Parliament, to the world and the markets out there about the seriousness that we attach to such an important issue.
I would also like to thank all those who participated and those who were present during the discussions and the debate. With those few words, hon Chairperson, I would like to say thank you.
Debate concluded.
Bill read a second time.
DIAMONDS SECOND AMENDMENT BILL
(Second Reading debate)
The ACTING MINISTER OF MINERALS AND ENERGY: Madam Chair, colleagues and hon members, the Minister of Minerals and Energy unfortunately lost her mother yesterday, and therefore, I am standing-in for her in this debate.
And therefore, please allow me to introduce to you the Diamonds Second Amendment Bill, 10 days after the House passed the Diamonds Amendment Bill. The Diamonds Second Amendment Bill was originally an integral part of the amendments that were passed in this House. During the tagging process, there was advice that all issues pertaining to diamond trade should be removed from the Diamonds Amendment Bill and be treated separately as a section 76 Bill.
However, hon members should remember that my colleague, Minister Lindiwe Hendricks, alluded to these issues contained in this second amending Bill when the first Bill was passed.
I will just briefly state these amendments. These amendments are effected in order to consolidate the carter and toolmaker into a diamond beneficiator. They also bar nonlicensees from assisting licence holders during the viewing, purchasing or selling of unpolished diamonds at any place where unpolished diamonds are offered for sale. This is done in order to minimise fronting.
The amendments are also meant to make the legislation gender-sensitive, as the Bill only referred to males. The amendments also stipulate the period of validity of licenses, permits and certificates. They replaced the term ”board”, as it refers to the South African Diamond Board with the term “regulator”, which refers to the diamond and precious metals regulator, who will implement, administer and control all matters relating to the purchase, import and export of diamonds.
We shall also establish the diamond export and exchange centre, which shall facilitate the buying, selling, export and import of diamonds. The state diamond trader shall acquire and supply unpolished diamonds to local diamond beneficiators, and also promote the diamond industry.
The last issue is that the Minister shall, from time to time, by notice in the Gazette, determine such percentages of diamonds produced in a production cycle as may be required for local beneficiation and that which the state trader may buy.
As hon members know, these are matters that are already agreed upon and understood and, as such, these amendments are made just to complete the changes that are to make the downstream development of our diamonds a reality. I know that members will support these changes. Thank you, Madam Chair. [Applause.]
Mr M H MATLALA: Chairperson, members of Parliament, comrades and compatriots, history tells us that diamond mining was the first type of organised mining to take place in South Africa.
Kimberley was a forerunner to formal mining with the discovery of this little precious stone. It transformed what was then an agrarian economy to a dual economy with the development of mechanised industries. History has again taught us that in order to get value from the mineral resources mines in the country, we must develop downstream in the mining value chain.
The diamond industry has failed to develop the beneficiation capacity, 138 years after the first discoveries. As the ANC, we believe that the promulgation of the Second Diamonds Amendment Bill will, to some extent, redress past imbalances, develop the local beneficiation industry and transform the diamond industry.
This Bill repeals section 59 of the Diamonds Act. It should be noted that this legislative development is in the interest of ensuring equitable access to the mineral resources of the country.
The Second Diamonds Amendment Bill is a section 76 version of the Diamonds Amendment Bill. This Bill seeks to revolutionise the mineral industry, especially the component of doing business. The application of this Bill will ensure equitable access to rough diamonds for those who wish to trade. This legislative development intends to increase the contribution of diamonds to the country’s economy by increasing the downstream activity.
This Bill also empowers the regulator to implement, administer and control all matters related to the sale, beneficiation, import and export of diamonds. It empowers the regulator to establish the diamond exchange and export centre. The DEEC will be responsible for facilitating the buying, selling, export and import of diamonds. The regulator will also empower the state diamond trader to acquire and supply unpolished diamonds to local beneficiators. The state diamond trader will, of course, promote the industry through necessary research and support.
As the ANC, we believe that the economic potential of this industry will be unleashed as skills development programmes will build the capacity that was previously nonexistent. As the ANC, we believe that this Bill will serve as an impetus to job creation.
Our study tour to India was an eye-opener. The Indian beneficiation industry employs about 2,5 million people. The beneficiation industry in South Africa, if there is commitment and determination from local diamond houses, will go a long way in creating a substantial number of jobs.
The subsidiary aim of the Bill is to spread wealth within the industry and to avoid unfair advantage by already existing diamond cartels that have been dominating the industry since the discovery of diamonds in South Africa.
This piece of legislation continues to show our commitment as the ANC-led government towards value additions to our mineral resources. The state diamond trader and diamond exchange and export centre will ensure transparency and accountability in the diamond trade. We heard, some two weeks back, President Festus Mogae of Botswana during his visit, when we addressed the importance of co-operation in this sector.
As the ANC-led government, we envision a collaborative effort in this regard. Therefore, the ANC supports the Bill. I thank you. [Applause.]
Adv H C SCHMIDT: Madam Chair, may I take the opportunity to express the DA’s sincere condolences to the Minister on the loss of her mother yesterday.
This Bill deals with those provisions, which, in terms of section 76 of the Constitution, are to be dealt with separately from the provisions contained in the Diamonds Amendment Bill, which was adopted by Parliament during the course of last week. This Bill establishes the authority of the Minister to determine the percentage of diamonds to be bought by the state diamond trader, which are to be sold to local diamond beneficiators.
It is important to note that this purchase may be based on carats and volume, and shall be a representative sample of a production cycle of any diamond producer. This provision will prevent the state diamond trader from purchasing the best rough diamonds from the producers, leaving the less economically cuttable diamonds, to the financial detriment of producers.
The newly introduced section 74 of the Bill also entitles the Minister, by notice in the Gazette, to exempt any person or category from the compulsory offering of all unpolished diamonds intended for export purposes to the diamond exchange and export centre.
Although we do not agree with the need for section 48(a), we welcome the ability of the Minister to provide exemptions to producers in such instances. The true impact of the Bill is difficult to ascertain, as the so- called accompanying money Bill, which will indicate the export duty, if any, to be payable by producers, is yet to be introduced. The diamond industry is currently facing an 8% royalty in total diamond sales, which in itself is higher than what most other industries are being expected to pay.
The introduction of a regulator and a state diamond trader, funded by government, as well as ministerial discretion of such important nature, as described earlier, is clearly an unwarranted interference in a free-market economy, which has caused the country at one point in history to be the largest diamond producer in the world, although South Africa is currently only the fourth largest producer.
The argument that the market has failed the industry is not correct; 2 500 employees currently work in the manufacturing industry, whilst in excess of approximately 114 000 people are employed in the entire diamond industry, of which the producers employ by far the majority.
While South Africa has to compete with countries such as India and China, which have an ever-increasing market share with regard to the manufacturing industry owing to lower labour costs and extensive assistance from their governments, introducing further barriers to trade will definitely not lead to an advantage for the South African diamond industry.
Die Suid-Afrikaanse regering moet, indien dit ernstig is met die uitbouing van die diamantvervaardigingsektor, maatreëls instel om die nywerheid daadwerklik te bevorder deur onder andere ekonomiese prosesseringsones te verklaar, belasting op die in- en uitvoer van diamante te verminder of, selfs beter, vir ’n bepaalde tydperk af te skaal, sowel as belasting betaalbaar deur maatskappye betrokke by die diamantsektor vir ’n tydperk op te skort totdat die sektor, soos in die geval van Indië en China, kan uitbrei en met hulle kan meeding. Die antwoord tot werklike kompetisie met bogenoemde lande lê ongelukkig opgesluit in die ingebruikneming van masjinerie, ’n aspek wat nie bevorderlik is vir die huidige doel van die wetgewing nie. (Translation of Afrikaans paragraph follows.)
[The South African government should, if it is serious about expanding the diamond manufacturing sector, take steps actively to promote the industry by declaring, amongst others, economic processing zones, reducing import and export tax on diamonds or, even better, scaling down for a fixed period, as well as suspending tax payable by companies involved with the diamond sector for a short while until the sector, as in the case of India and China, is able to expand and compete with them. The answer to real competition with the above-mentioned countries, unfortunately, lies in the introduction of machinery, an aspect that is not relevant to the current purpose of the legislation.]
As stated during the debate on the Diamonds Amendment Bill last week, the DA is not in a position to support this Bill. I thank you.
Mr T E VEZI: Madam Chair, the IFP would also like to convey its condolences to the hon Minister on the death of her mother.
The IFP supports the Diamonds Second Amendment Bill, as it empowers the regulator to administer and control all matters relating to the purchase, sale, beneficiation, import and export of diamonds.
The Bill also empowers the state diamond trader to promote the industry and assist the beneficiator. The Diamonds Act’s section 59 will be repealed and local producers will have to offer their production to the state diamond trader as a first step. Local trading houses will be entitled to buying and selling unpolished diamonds on the premises. Thank you, the IFP supports the Bill.
Mr H B CUPIDO: Chairperson, the amendment proposed in this Bill improves the readability of the Bill and makes it easier to understand. It also makes sure that the gender issue is well-addressed in order to accommodate gender in the diamond industry.
The ACDP, however, cannot support the Bill, because none of the amendments in any way changes the power and the interference the government would have in the establishment of the state diamond trader and the SA diamond and precious metals regulator. As the ACDP is not prepared to shift from the principles of a free-market economic system, we again urge the government to clarify the political and economic framework within which it will address the transformation of the diamond industry.
The ACDP is in full support of local beneficiation and trusts that the objectives of the Bill will realise without major detriment to the industry and the economy. Thank you.
Mr M T LIKOTSI: Chairperson, this Bill is intended to regulate the diamond industry, its transactions and licensing. It provides for a regulator and a state diamond trader.
During the 15th century, in what was called the expansion of markets founded by rising commercial capital of Western Europe, our land and its mineral resources were looted on a scale unprecedented in human history. We are still suffering from the aftermath at this stage as the way to recovery is dim.
The PAC welcomes concerted efforts made by some sons and daughters of the soil to get involved in the mining sector on a large scale as producers. We may not remain consumers in perpetuity.
The wealth of our country must be equitably distributed to benefit all of its citizens. Africans must resist the temptation of enriching a few elite, thus creating a class society of the haves and have-nots. The poorest and struggling African majority must own means of production in their country of birth. The PAC supports the Bill. [Time expired.]
Mr R B BHOOLA: Chairperson, mining is said to contribute 25,6% to the economy at the current rate. With such a great contribution to our economy and South Africa being one of the world’s largest producers of diamonds, the MF is surprised that the beneficiation of diamonds in South Africa had not been localised through legislation a long time ago.
Similarly, it should also be noted, if one considers the history that magnetised the world to mining for diamonds in South Africa, that the MF firmly believes that the natural resources and minerals should supply the economy with local skills, before preference is given to external traders.
In view of the provisions and amendments made to the Diamonds Act of 1986, the MF finds it justifiable that the beneficiation of diamond resources in South Africa, through this piece of legislation, gives preference to our local diamond cutting and polishing industries. The mechanism established for doing this should clearly provide our local market with a constant local supply of uncut diamonds. The MF supports the Bill. [Time expired.]
Mr C D KEKANA: Madam Chairperson, members of Parliament, ladies and gentlemen, the thrust of the Bill is supported by us in the ANC.
The first point that I want to make – just to give the background that led to the crafting of this Bill – is that the socioeconomic conditions in the country are bad. Ten percent of our graduates are unemployed - and this I am repeating - 60% of our youth are unemployed, and 42% of our people are unemployed.
Against such a background, obviously, independence and freedom is undermined. Our democracy will be severely undermined unless we address this legacy that we have adopted from the past.
Now, people speak about the free-market economy, and that we should not intervene. I wonder how free this free-market economy is, given the monopolies and the domination. Only 5% of blacks have entered the economy in terms of ownership; 95% of the economy is still dominated by the previously advantaged. How free is the free market?
The last point I want to make is that this Bill obviously is an attempt to address socioeconomic conditions. Ten percent of the total population is made up of Africa. In other words, Africa constitutes 10% of the total population of the world. Out of that, 30% of the people of Africa are amongst the poorest in the world.
Now that is a legacy that pertains not just to South Africa, but to the whole of Africa. The fact is that the indigenous people were deprived of their own land, and if you take land away from people, it means you are taking away the minerals underneath and you are also taking fertile soil away from them.
If you do that, you are obviously taking away the livelihood of the people from the people. This is an attempt to restore that, because people are poor. About 6 000 000 of the people of South Africa are poor. That situation has to be addressed and this Bill, the Diamonds Second Amendment Bill, is an attempt to make sure that the people will benefit from the resources of South Africa, and these resources are not just there to enrich overseas people. Thanks very much. [Applause.]
The ACTING MINISTER OF MINERALS AND ENERGY: Madam Chair, thanks to all the members for their participation in this debate. [Interjections.]
I do, by the way.
I would agree, to an extent, with hon member Schmidt, that the assessment of the impact of what we are trying to do is difficult. What that means is that on its own the Bill is not going to produce these results. There is a lot of other work that we are going to have to do, and which we are doing as government, in order to make sure that we lay the basis for beneficiation to take off in South Africa.
Therefore, there are other measures that we are taking, and the Department of Trade and Industry and the Department of Minerals and Energy are working on a beneficiation strategy and on beneficiation incentives in order to make sure that we create the basis for success.
We are doing this work in other areas as well, in the area of steel and in the area of chemicals. And therefore, concerning the jobs that you were referring to, we think that there is scope to expand those jobs and have a lot more people employed in beneficiation.
It is also possible, big as India and China are, for smaller economies to compete effectively in identified and well-considered niche areas. This is what we are also trying to do, because we think that it is possible to make ourselves competitive in this particular area.
On the issue of interference by government, which was raised by the ACDP, I actually cannot believe that the ACDP is raising this kind of point. Quite clearly, if you go back to the ten-year review that we did, it will show you that a great deal of progress was made in South Africa in those areas where government acted and had power to act. [Applause.] Therefore, it is not correct to say that interference by government produces negative results.
We have to move beyond preapartheid South Africa. We are in postapartheid South Africa, and in preapartheid South Africa we did not see growth of manufacturing in this area, even though we are the largest producers of diamonds in the world. We have to change that situation.
Furthermore, where market failure occurs, it is the responsibility of government to act. And we do believe that South Africa has a long- established tradition in manufacturing. It is not like we are starting something that is unknown in South Africa, but we are trying to expand the scope of manufacturing, particularly in the diamond beneficiation area.
I would like to thank all members who supported the Bill. [Applause.]
The HOUSE CHAIRPERSON (Ms C-S Botha): Hon members, I wish to indicate that after consultation, I have decided to postpone the decision of question on the Bill to the following week.
Debate concluded.
Decision of question postponed.
REPORT NO 30 OF PUBLIC PROTECTOR – PETROSA
(Consideration of Report)
Mr E N MTHETHWA: Chairperson, on 31 August 2005 the Portfolio Committee on Minerals and Energy considered and adopted the Public Protector’s report and its recommendations on PetroSA’s dealings with Imvume. This followed a complaint lodged by the FF Plus on such dealings. It would be of primary importance, members, to start by sketching the scope of this investigation.
The mandate of the Public Protector on this matter is, by law: to investigate matters relating to government bodies, public entities, state affairs and dishonesty in handling public money. Consequently, the allegations pertaining to the relationship between Imvume and the ANC, payments made by Imvume to the ANC and private entities, and the involvement of the ANC in Mr Majali’s business negotiations with the government of Iraq could not be investigated.
The finding that we adopted, members, relates to the fact that much of what has been published by the Mail & Guardian was factually incorrect, based on incomplete information and documentation, and comprised unsubstantiated suggestions and unjustified speculation. The approval and authorisation on 18 December 2003 by the acting CEO of PetroSA of an advance payment of R15 million to Imvume was lawful, according to the findings, and was well- founded and properly considered in terms of the legal and policy prescript that applied to PetroSA.
The decision to approve Imvume’s request for an advance, as it was presented to PetroSA, was not unreasonable under the prevailing circumstances and did not amount to maladministration, abuse of power, or the receipt of any unlawful or improper advantage. Imvume’s failure to pay Glencore, the supplier, the full amount due to it in respect of the cargo of oil condensate concerned, could not reasonably have been foreseen and expected by PetroSA.
The Scopa committee was also informed that PetroSA and Imvume had an ongoing relationship, and in the past they have had more than seven transactions to that effect. PetroSA’s payment of the amount of US$2,8 million, plus interest, to Glencore on 23 February 2004 was in the public interest and complied with its legal obligations in terms of the Public Finance Management Act.
The subsequent action taken by PetroSA to recover from Imvume the amount paid to Glencore was taken without delay, and in compliance with its legal obligations in terms of the Public Finance Management Act. The allegations and suggestions of improper influence made against Deputy President Mlambo- Nqcuka in relation to the advance payment were not substantiated and are without merit.
The letter of complaint from the hon Mr Leon was based in its entirety on the allegations published by the Mail & Guardian on 15 July 2004. And this is a leader of a party. This is how this party forms its policies: They read the Mail & Guardian and then come up with a policy position. [Interjections.]
The allegations of improper involvement of senior officials of the Department of Minerals and Energy and the Strategic Fuels Fund, SFF, in the advancement of business relations between Imvume and the Iraqi government, and that a crude oil supply contract was improperly awarded to Imvume by the SFF in March 2002 are without merit. The recommendation was that the board, in consultation with the CEO of PetroSA and legal advisers, take urgent steps to recover the money due to PetroSA. There had to be regular reports to the Minister on progress made in regard to the recovery of this money. The Minister of Minerals and Energy had to report to Cabinet and to Parliament on the steps taken and the progress made regarding this.
It is against this backdrop that we are surprised at the U-turn made by the FF Plus, namely that the matter is sub judice. The route we took of going to the Public Protector was through the very same FF Plus. However, because their complaint did not achieve what they wanted, they cried foul.
An HON MEMBER: They are not even in the House.
Mr E N MTHETHWA: They are not here, yes. As for the DA, it exposed the emptiness of ideas in this party. If a leader bases his political intervention purely on a newspaper report, and when the Public Protector asks him to substantiate he refers the Public Protector to the Mail & Guardian, we wonder what kind of a party it is, and we wonder about the future opposition. [Interjections.] That is the reason the opposition is so weak in South Africa. Thank you, Chairperson. [Applause.]
Adv H C SCHMIDT: Chair, this report emanates from claims that the ANC received R11 million in state money from PetroSA, a government enterprise, for its 2004 election campaign. It was, furthermore, alleged that Imvume manangement, PetroSA’s black economic empowerment partner, acted as a mere intermediary between the ANC and PetroSA. To date the ANC has yet to explain to the public whether it received the amount of R11 million or not, although that is without contention at this point in time.
Despite public and media speculation, the ANC’s silence on the matter is an admission that it in fact received such an amount.
Die Openbare Vervolger het aangedui dat hulle PetroSA en die Departement van Minerale en Energie genader het vir hulle weergawe van die beweringe, en het voortgegaan om die verduidelikings klakkeloos te aanvaar. Geen deeglike navorsing en ondersoek is deur die Openbare Beskermer geloods nie, en in die besonder sover dit die bewerings soos vervat in die media, en in die besonder die Mail & Guardian, aangaan nie. (Translation of Afrikaans paragraph follows.)
[The Public Prosecutor indicated that they had approached PetroSA and the Department of Minerals and Energy for their version of the allegations, and then accepted their explanations without further ado. No thorough research and investigation was launched by the Public Protector, and in particular not with regard to the allegations as implied in the media, and specifically the Mail & Guardian.]
Its findings failed to address the most pressing concerns, which to date remain unanswered. During the briefing to Scopa by PetroSA, the following important questions were asked - they remain unanswered –which raised serious doubts about the comprehensiveness of the investigation: Firstly, the fact that the PetroSA board agreed to request an advance payment; secondly, the fact that PetroSA agreed to such advance payment of R15 million on 19 December 2003, a few days before Christmas, and clearly during the festive season when the Chief Executive Officer was on leave; thirdly, the request for payment and the agreement by PetroSA to pay the advance payment into an account different from the one specified in terms of the contract; fourthly, the fact that the account into which payment was requested was rand-denominated and not dollar-denominated, as specified in the contract; fifthly, the inadequate reason given by Imvume management, namely that this unusual request related to the payment of salaries and bonuses to staff members, is questionable; sixthly, no risk assessment was conducted by PetroSA upon being confronted with a request to make an advance payment, which in itself indicated serious concerns regarding its financial affairs, to pay staff salaries and bonuses; and seventhly, PetroSA acceded to this request despite a dramatically weakened financial position with a profit of R214 million in 2004, compared to R3,3 billion in 2003.
The DA requested further information in terms of the Promotion of Access to Information Act, an Act that was passed by this Parliament in 2000 in order to ensure accountability and openness in governance. This request was turned down without proper reasons being provided, leading to the DA taking legal steps to compel PetroSA to comply with the Act.
PetroSA’s explanation that, although a government entity funded by taxpayers’ money, it still was a private body, should be rejected with the utmost contempt. This position not only makes a mockery of the Act, but also underestimates the intelligence of the public, to whom it has a duty to report.
As stated before, the entire framework of the BEE policy in South Africa has been damaged by these allegations as they seem to suggest a pattern in which BEE companies are used by the ANC to provide kickbacks to the ruling party. [Interjections.]
The DA therefore calls upon PetroSA and the ANC to explain to the public, and provide proof, as to whether they did not receive the R11 million in the so-called “oil-for-votes scandal.” Thank you.
Mr T E VEZI: Chair, I might mention here that I am simply going to read the statement of our principal member. The IFP has acknowledged the report of PetroSA regarding the investigative process followed, and that consultation has taken place between the Public Protector and the implicated parties.
The real issue is that Imvume did not have the funds to pay for the shipment of crude oil. To avoid additional charges, PetroSA opted to pay, and therefore claimed the money from Imvume. The IFP sincerely hopes that the balance of the money owed to PetroSA by Imvume will, in due course, be recovered. I thank you. Mr L W GREYLING: Chair, I noticed that hon Mthethwa did not attack the ID, even though we objected to the report. It’s obviously because our reasons were probably more sound. The reason we objected to this report is that although we do not question the integrity of the Public Protector, we do question his defining of his mandate not to investigate what happened to the money after it was given to Imvume.
We were also not satisfied that the consultative processes were wide enough and that the Mail & Guardian was not even called to give evidence, even though it was quoted widely in the report. The committee did say in its report that it undertakes to follow up on the processes to ensure that the outstanding amount owed by Imvume is recovered.
The ID believes that the best way of recovering that money is simply for the ANC to give the money back. Although there might be debates about public versus private money and whether Imvume’s actions constituted fraud, which the ID believes they did, there is simply no denying the fact that the money was not used for its intended purpose. The ANC should, therefore, feel an ethical and moral obligation to give the money back, particularly since it has been so outspoken about corruption in recent times. I thank you.
Mr H B CUPIDO: Chairperson, it is no secret that corruption is one of the evils eating away at the South African economy. It has been reported that in the public sector corruption costs South Africa between R50 billion and R150 billion per year. We as the ACDP support any constructive action taken to root out corruption.
The ongoing saga termed the “oilgate scandal” is a clear demonstration that something is amiss in our young democracy. For too long, the ANC-led government has evaded the issue and is now being exposed for some of its corrupt dealings. It is a fact that the ANC benefited most from the skewed relationship between Imvume management and PetroSA, which filled up its coffers for the national elections in 2004.
Using public funds for political purposes must never be accepted in a democracy-loving country. The people of South Africa need to be assured that they can trust bodies and institutions that they have voted for, to carry out their duties according to democratic principles.
The ACDP cannot, in good conscience, support this report. I thank you.
Mr R B BHOOLA: Chairperson, even though the Public Protector has limited its investigating parameters to institutions of state, public entities and the misconduct of a juristic person performing a public function, the MF is confident that these parameters are adequate.
The questionable relationship between PetroSA and certain related authorities and states persons has been certified by the Public Protector as being without merit. This should caution us to be wary of what we read in the papers and of relying on such material as accurate and dependable.
The MF is pleased that the findings do not show any form of corruption or mismanagement in the sector. However, such discrepancy exists as the accuracy of the findings is based on the limitations of the Public Protector. The MF also feels that the investigation should be allowed into all sectors that were not investigated to ensure general satisfaction. The MF is satisfied with the findings of the Public Protector. [Time expired.]
Mr S K LOUW: Chairperson, earlier on our chairperson laid a solid foundation and presented a factual report of PetroSA. Some parties in this House really want to paint an oily picture of this report from the Public Protector.
To refresh the memories of hon members, the so-called “oilgate” issue emanates from a newspaper article in the Mail & Guardian of 15 July 2005. The DA and the FF Plus jumped on the bandwagon of the Mail & Guardian as choirmasters in the chorus of unsubstantiated allegations.
The FF Plus accused PetroSA of improper conduct and administration, and that it used Imvume as a conduit to channel funds into the ANC, whilst the DA laid the complaint about the awarding of a crude oil supply tender to Imvume management in March 2002. Their complaints on the alleged corruption were filed with the Office of the Public Protector, a Chapter 9 institution, and due processes were followed to investigate these allegations.
After thorough investigations of the two allegations were done by the Office of the Public Protector, the Public Protector ruled that the advance in question was paid to Imvume on the basis of its agreement with PetroSA. Imvume was not an acting agent for PetroSA, but had a separate contract with Glencoe.
It should further be noted that prior to this occurrence, Imvume had made seven successful deliveries of oil condensate. According to the Public Protector’s ruling, unlawful appropriation of the payment made by Imvume could only have affected Glencoe and not PetroSA, which had an interest in the delivery of oil condensate it had paid for.
Logical thinking is a scarce commodity in the DA, the FF Plus, and now the ID. They went out with the choirmaster, the Mail & Guardian, and cried foul in the process. They called the Public Protector’s report names and unsavoury comments were made.
To us, this simply displays that they are not principled and not politically focused. They ignore the findings of the Public Protector and instead want to prescribe to this impartial and apolitical institution. They display a holier-than-thou attitude when it comes to these facts.
It should be noted that the DA and the FF Plus are brothers in arms in the opposition to black economic empowerment. It is a disturbing fact that the DA and the FF Plus are not conscious of the basic tenets of the policies of the country and BEE. [Time expired.][Applause.]
Debate concluded.
Decision on question postponed.
ADDITIONAL PROTOCOL TO THE TRADE, DEVELOPMENT AND CO-OPERATION AGREEMENT (TDCA) BETWEEN THE REPUBLIC OF SOUTH AFRICA AND THE EUROPEAN COMMUNITY (EC) AND ITS MEMBER STATES
(Consideration of request for approval by Parliament)
Mr B A D MARTINS: Chairperson and hon members, the European Union is presently South Africa’s largest trading partner and its main source of foreign direct investment. The South Africa-European Union Trade, Development and Co-operation Agreement that governs South Africa’s relations with the EU was initially signed on 11 October 1999. Application of the development provisions and trade in goods provisions of this agreement was provisionally effected on 1 January 2000. The agreement came into force on 1 May 2004.
The Trade, Development and Co-operation Agreement also provides a legal basis for the continued EU support for development co-operation in South Africa through the European Programme for Reconstruction and Development. It also provides for political co-operation.
On 1 May 2004 the European Union expanded from 15 to 25 member states, with the accession of 10 new countries in Central and Eastern Europe. To cater for these countries’ accession, a legal basis had to be created, with effect from 1 May 2004, to extend the Trade, Development and Co-operation Agreement to them. This was done in the form of an additional protocol to the Trade, Development and Co-operation Agreement. The protocol deals mainly with technical amendments required by the enlargement of the EU.
The important point to note, however, is that trade concessions contained in the Trade, Development and Co-operation Agreement will automatically be extended to the new EU members. The countries are Poland, the Czech Republic, Slovakia, Slovenia, Hungary, Latvia, Lithuania, Estonia, Cyprus and Malta.
The additional protocol was signed on 25 June 2005. In terms of section 231(2) of the Constitution, it has to be ratified before it can be binding on South Africa. Legislation to implement the additional protocol has been prepared and the SA Revenue Service has confirmed that the protocol to the Trade, Development and Co-operation Agreement would be applied retrospectively as of 1 May 2004 in accordance with the Customs and Excise Act, Act 91 of 1964, once parliamentary approval has been obtained.
Economic operators were advised to pay normal customs duties during the period before ratification and would be reimbursed once the process has been finalised.
In conclusion, the extension of the Trade, Development and Co-operation Agreement to the 10 new member states will ensure that South African exports to them will benefit from the same conditions as they currently enjoy with the original 15 members of the EU. Imports from these countries to South Africa will also benefit from the preferential conditions contained in the agreement.
Finally, it means that our trade relations with a very large part of Europe will be harmonised and carried out according to the Trade, Development and Co-operation Agreement. I thank you.
Order disposed of without debate.
REPORT ON INFORMATION AND UPDATE WORKSHOP FOR PAN-AFRICAN PARLIAMENT STANDING COMMITTEE ON CO-OPERATION, INTERNATIONAL RELATIONS AND CONFLICT
RESOLUTION, 1 – 2 APRIL 2005
REPORT OF THE SOUTH AFRICAN DELEGATION TO THE THIRD ORDINARY SESSION OF THE PAN-AFRICAN PARLIAMENT, 29 MARCH 2005, HELD AT GALLAGHER ESTATE, MIDRAND.
REPORT OF THE PUBLIC SERVICE COMMISSION ON THE INVESTIGATION INTO THE APPOINTMENT OF PROFESSIONAL CUBANS IN THE SOUTH AFRICAN PUBLIC SERVICE.
(Consideration of Reports of Portfolio Committee on Foreign Affairs)
Ms F HAJAIG: Hon Chair, colleagues and comrades, it gives me great pleasure to speak on this report on the Pan-African Parliament, because it forms an important part in defining the African agenda.
The African agenda must be understood and defined in relation to the multiple problems that have faced the continent since independence in the 1960s and that have conspired to retard its development. With a foundation built on a traumatising colonial and postcolonial experience, Africa’s complex problems range from externally oriented, dependent and undiversified economies through poor governance, economic, political and corporate governance, and related issues of intra and inter-African conflicts, unfavourable global economic and political environments resulting in ever deepening marginalisation of Africa in global markets, international financial institutions, international investments and global decision-making.
Africa’s problems become more marked given its notoriety for poor governance, unsustainable debt burden, low and poorly channelled official development assistance, continuously dividing shares of global financial direct investment, multiple and varied forms of barriers against Africa’s products entering the markets of industrialised countries, lack of infrastructure - both national and regional - and a dire need for skilled human capital.
Africa is endowed with some of the world’s most sought-after resources, namely oil, gold, diamonds, etc, but still has the most dire, poverty- stricken and suffering peoples in the world. The question remains as to whether the Pan-African Parliament could have a role in the actualisation of the African agenda. How, for example, can the Pan-African Parliament influence material, regional and global processes that are capable of facilitating the entrenchment of good governance, democracy and a human rights culture?
What should be the role of the Pan-African Parliament in promoting peace, security and stability on the continent? Could the Pan- African Parliament make an input into efforts aimed at eradicating poverty and underdevelopment in Africa? And finally, can the Pan- African Parliament influence external stakeholders, especially through the material and regional legislatures, to keep the pledges to assist the continent’s developmental endeavours?
I am pleased to report that despite the teething problems that we face in the establishment of this new institution, the Pan-African Parliament, and in the words of the Speaker, the hon Ms B Mbete: “in reclaiming Africa’s land and leading the continent in creating its own destiny”, we have started the work with commitment and earnestness. The volume of work covered by the 10 committees and the quality of debates in plenary showed the level of dedication and the will to succeed by all 194 Pan-African parliamentarians from 39 member states.
The third session of the Pan-African Parliament focused on a number of issues amongst which were: firstly, administrative issues, including the 2005 budget, the annual report and the establishment of a trust fund, which will ensure the autonomy and self-reliance of the Pan-African Parliament.
Secondly, it focused on procedural and process issues, including the strengthening of the 10 committees, plus the consideration of committee priorities and work plans. The Committee on Co-operation, International Relations and Conflict Resolution held a two-day workshop on 1 and 2 April where a wide panel of academics discussed this issue in depth. Its report appears on the ATC of 25 October. It makes for interesting reading.
Thirdly, it focused on debates on issues of continental significance. Amongst the issues and topics debated were the Millennium Development Goals; the United Nations reform; combating HIV/Aids in Africa; the tremendous transportation and communication problems in Africa and the peace mission to Darfur, Sudan. This committee decided to send a fact- finding mission to Darfur, and a proposed mission is to be sent soon to Cote d’Ivoire and the DRC.
Lastly, in-depth debates were held on agricultural problems in Africa. All the summaries of these debates appear on the ATC reports of 25 October. However, it is important to note that South African parliamentarians made commendable contributions to the various debates and especially in the various committees on which they served.
A number of recommendations and resolutions were passed by the third session, of which I will cite but a few. The Pan-African Parliament recommends that the African Union investigate the viability of harmonising the establishment of an African land title system. It further requests . . . [Time expired.]
Mr L K JOUBERT: Chairperson and hon members, I sincerely hope that the short time allocated to this debate and the poor attendance this morning, especially in the front benches, are not indicative of the light in which these reports are seen.
As far as the Pan-African Parliament’s reports are concerned, I wish to make use of this opportunity to reiterate our disappointment that the largest opposition party in South Africa is not represented in the Pan- African Parliament.
The way in which the majority party, again, abused its majority in this regard is a blot on the representivity of the Pan-African Parliament. I can only hope that the ANC, which is a minority party in the Pan-African Parliament, will learn from its experience there and do unto others, as they would like others to do unto them here.
As far as the report of the Public Service Commission is concerned, I want to highlight three alarming aspects: Firstly, there are more vacant engineering posts in the Public Service than there are filled posts. There are 1 734 vacancies, against 1 482 filled posts - a shortfall of more than 120%. About 3% or 53 positions are filled by foreigners.
Secondly, there are 339 Cuban medical practitioners in South Africa, but how many South African doctors and nurses have left the country? Thirdly, there are 120 Cuban architects, engineers and technicians in the Public Service in terms of our bilateral agreement, but, again, how many have left the country?
I want to make only one comment in this regard: The brain drain will not be stopped by importing Cubans; we must address the cause and stop treating the symptoms. We support the adoption of these reports. I thank you. [Applause.]
Mr H B CUPIDO: Chairperson, the ACDP believes, first and foremost, in the enhancement of South African skilled workers. It is obvious that the employment of Cuban professionals, particularly in the medical profession, alleviates the pressure this sector has been experiencing for some time.
However, it seems that our problem goes much deeper. To date the government has done little or nothing to bring home and encourage our own professionals to use their talents and skills in South Africa.
In April this year many South African nurses attended their places of work wearing their pyjamas as a means of protesting against government for providing them with a mere R4,50 subsidy a month towards the purchase of their uniforms. This happened in the best-case scenario, because some received nothing.
Can we really expect our nurses to want to continue serving the country under these conditions? With the rising HIV/Aids crisis in South Africa, we cannot afford to lose the professionals who form an integral part of effecting the roll-out of ARVs.
The ACDP is aware that the South African government has some good initiatives in place to entice South African professionals in foreign places to return home. However, it is not clear to us whether enough effort has been put into ensuring that the professionals who are being called back are encouraged to stay and will receive the respect they deserve, as well as salaries in line with their skills.
Too many of our professionals are leaving the country in the hope of finding greener pastures. Undeniably, some of them do, and more often than not, those who do not find what they had wanted, choose to remain abroad because they believe that it is better to experience hardships there than in their own country where the standard of living for the poor is unbearable.
Whilst the ACDP will never support any kind of xenophobic attitudes towards foreign professionals, we do believe that our first priority must be to enhance the skills of our own professionals, as well as to ensure that they receive salaries in line with those skills. Thank you.
Mr D J SITHOLE: Chairperson, members raise questions about the fact that when you recruit Cubans, everybody seems to have a sense of nostalgia in terms of how they relate to them.
Everyone who has said anything here has said what he or she did because the professionals involved are actually Cubans. It has nothing to do with the requirements of skills, but has everything to do with the ideological imprisonment those people suffer from. That is a problem we have to deal with.
The Public Service Commission has done its work and it has investigated the recruitment of professionals, and it has accepted that those professionals filled the skills that were required by those departments. Therefore, for people to then suggest that because those professionals happen to be Cubans there is something that they must look for and that something is wrong is actually in itself politicking rather being honest about the requirements of the country.
Everyone talks about the economic growth of this country, therefore, everyone acknowledges the fact that South Africa does have a problem with skills. Yet when we go out and recruit skills, people want us to recruit in the countries that they are politically comfortable with. There is nothing wrong, Mr Gibson, with us recruiting Cubans. [Interjections.]
The fact that you have an ideological problem with Cubans does not remove the fact that when there are professionals and skilled people in Cuba, we must go and recruit them. [Applause.] There is nothing wrong with us, in the process of doing that, investing in our education to make sure that we produce the skills that we require. We don’t have certain skills and, therefore, we must go and recruit them. And it doesn’t mean that we must go to your comfortable places to recruit such skills. [Interjections.]
Having said that, it is said that . . .
The HOUSE CHAIRPERSON (Mr K O Bapela): Order! Hon members, you are now drowning the speaker. Could you allow him to speak, please?
Mr D J SITHOLE: Chairperson, you should not be worried about that. The reason, Mr Gibson, you have lost so many members in the DA is because of the lack of clarity in the party regarding how you see situations and your failure to accept the reality. That is the reason those people have walked away. Those who have remained are going to walk away because you are not able to provide leadership and accept the fact that we don’t have particular skills.
In that report, in fact, it is pointed out that there is only one university that provides particular training for medical engineers. We don’t even have an educational institution that provides that. There is nothing wrong with us recruiting medical engineers to come and work here. I can understand that as a liberal, you would have reservations with regard to Cuba. But you know what, we will recruit the skills that we need and we will go anywhere in the world to recruit such skills, including Cuba. We are not only going to consider liberal countries that make you comfortable. Thank you, Chair.
Debate concluded.
Reports adopted.
The House adjourned at 12:11. ____
ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS
THURSDAY, 10 NOVEMBER 2005
ANNOUNCEMENTS:
National Assembly and National Council of Provinces
The Speaker and the Chairperson
-
Assent by President in respect of Bill
1) Armaments Corporation of South Africa, Limited Amendment Bill [B 14 – 2005] – Act No 16 of 2005 (assented to and signed by President on 8 November 2005).
-
Translation of Bill submitted
(1) The Minister of Finance
i) Aansuiweringsbegrotingswetsontwerp [W 37 – 2005] (National
Assembly – sec 77)
This is the official translation into Afrikaans of the Adjustments
Appropriation Bill [B 37 – 2005] (National Assembly – sec 77).
National Assembly
- Membership of Committees
1) Mr N T Godi has been elected as Chairperson of the Standing Committee on Public Accounts with effect from 1 November 2005.
TABLINGS:
National Assembly and National Council of Provinces
- The Speaker and the Chairperson
a) Report of the Auditor-General on the Information Systems Audits
performed at the National Treasury and the State Information
Technology Agency for the financial year 2004-2005 [RP 209-2005].
b) Report of the Auditor-General on a performance audit of the
Management of Sick Leave Benefits at certain National and Provincial
Departments [RP 215-2005].
c) Report of the Auditor-General on the financial statements of the
Special Pensions Board for the year ended 31 March 2005 [RP 217-
2005].
d) Special Report of the Auditor-General on the Status of the Delays in
tabling of Annual Reports and consolidated financial statements of
National Government for the financial year ended 2004-2005 (as at 31
October 2005) [RP 225-2005].
- The Minister of Education
a) Report and Financial Statements of the Education Labour Relations Council for 2004-2005, including the Report of the Auditor-General on the Financial Statements for 2004-2005 [RP 222-2005].
National Assembly
-
The Speaker
a) Letter from the Minister of Home Affairs dated 4 October 2005 to the Speaker of the National Assembly, in terms of section 65(2)(a) of the Public Finance Management Act, 1999 (Act No 1 of 1999), explaining the delay in the tabling of the Annual Report of Home Affairs for 2004-2005:
TABLING OF THE ANNUAL REPORT AND AUDITED FINANCIAL STATEMENTS FOR THE 2004/05 FINANCIAL YEAR IN THE NATIONAL ASSEMBLY
-
This communiqué serves to comply with the requirements of the Public Finance Management Act. The Department has not been able to table its Annual Report, Audited Annual Financial Statements and the audit report within the prescribed period. In terms of Sec 65(2)(a) of the PFMA, in my capacity as the Executive Authority I have to provide Madame Speaker with reasons for failure to table the above within six months.
-
The main reason for this non-compliance is due to the delays in the finalisation of the audit report by the Office of the Auditor- General which was not of the making of the department.
-
During the audit steering committee meeting representatives of the Auditor-General confirmed that there is a delay on their side due to capacity problems. We will table once the audit has been finalised.
-
Your kind consideration of this explanation would be appreciated.
Yours faithfully
N MAPISA-NQAKULA MINISTER OF HOME AFFAIRS
-
COMMITTEE REPORTS:
National Assembly
-
Report of the Portfolio Committee on Finance on the Adjustments Appropriation Bill [B 37-2005] (National Assembly – sec 77), dated 9 November 2005:
The Portfolio Committee on Finance, having considered and examined the Adjustments Appropriation Bill, [B 37 – 2005] (National Assembly – sec 77), referred to it, and classified by the JTM as a section 77 Bill, reports that it has agreed to the Bill.
FRIDAY, 11 NOVEMBER 2005
ANNOUNCEMENTS:
National Assembly and National Council of Provinces
The Speaker and the Chairperson
-
Translation of Bill submitted
1) The Minister of Health
(i) uMthethosivivinywa WobuHlengikazi [B 26 – 2005] (National Assembly – sec 76)
This is the official translation into isiZulu of the Nursing Bill [B 26 – 2005] (National Assembly – sec 76).
TABLINGS:
National Assembly and National Council of Provinces
- The Speaker and the Chairperson
(a) Budget and Strategic Plan of the Auditor-General for 2006-07,
tabled in terms of section 38(2) of the Public Audit Act, 2004
(Act No 25 of 2004).
- The Minister of Water Affairs and Forestry
(a) Notice No 925 published in Government Gazette No 28058 dated 23
September 2005: Release of State land at De Mond, Western Cape
Province, which is no longer required for forestry purposes, made
in terms of section 50(4) of the National Forests Act, 1998 (Act No
84 of 1998).
(b) Notice No 926 published in Government Gazette No 28060 dated 23
September 2005: Water Tribunals Rules made in terms of section
148(5) of the National Water Act, 1998 (Act No 36 of 1998).
(c) Notice No 945 published in Government Gazette No 28053 dated 30
September 2005: Proposal for the establishment of the Gouritz
Catchment Management Agency, made in terms of section 78(3) of the
National Water Act, 1998 (Act No 36 of 1998).
(d) Notice No 944 published in Government Gazette No 28053 dated 30
September 2005: Proposal for the establishment of the Olifants-
Doorn Catchment Management Agency, made in terms of section 78(3)
of the National Water Act, 1998 (Act No 36 of 1998).
(e) Notice No 939 published in Government Gazette No 28053 dated 30
September 2005: Establishment of the Crocodile (West)-Marico
Catchment Management Agency (Water Management Area No 3) which
covers the Northern part of the North-West Province, North-Eastern
part of Gauteng, the South-West portion of Limpopo Province and a
small portion of Western Mpumalanga and is bordered by Botswana on
its North-Western side, made in terms of section 78(1) of the
National Water Act, 1998 (Act No 36 of 1998).