National Council of Provinces - 13 April 2005
WEDNESDAY, 13 APRIL 2005 __
PROCEEDINGS OF THE NATIONAL COUNCIL OF PROVINCES
____
The Council met at 14:02.
The Chairperson took the Chair and requested members to observe a moment of silence for prayers or meditation.
ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS – see col 000.
NOTICES OF MOTION
Ms J F TERBLANCHE: Chairperson, I hereby give notice that I shall move on the next sitting day, on behalf of the DA:
That the Council –
(1) expresses its concern that ANC members in their capacity as presiding officers of this House are unable to act impartially and in the interests of all members, in that during the plenary session of 12 April 2005 –
(a) the Chairperson of the NCOP failed to recognise Mr
Krumbock when he rose to object to an ANC motion without
notice, so as to ensure that the ANC’s motion was passed; and
(b) the Chairperson of Committees abused her position as a
presiding officer by making gratuitous remarks in defence of
the ANC in response to a DA question directed to the Minister
for Provincial and Local Government;
2) therefore condemns this blatant abuse of power by ANC presiding
officers; and
3) expresses its concern for real democracy and fairness in this
House.
The CHIEF WHIP OF THE COUNCIL: Chairperson, I propose that the Chairperson, in terms of Rule 80, rules this motion out of order.
The CHAIRPERSON OF THE NCOP: I will study the Rules carefully and I will rule on that matter.
Mr M O ROBERTSON: Chairperson, I hereby give notice that I shall move on the next sitting day:
That the Council –
1) notes the unfortunate uninformed statements by the opposition to
the effect that the Chief Whip of the Council misled this esteemed
House and insulted an hon member;
2) herewith states unequivocally that the Chief Whip does not take
minutes but, except for this fact, that this matter was indeed
discussed in detail at the steering committee meeting where the
issue of the budget for the Mpumalanga visit was dealt with and was
referred to a multiparty Whips forum and programming meeting;
(3) further states that the late and irregular attendance, including
cases of complete absenteeism on the part of the official
opposition, the DA, seems to have robbed its members of relevant
information, hence the lack of information and therefore ignorant
statements that emerge from their members; and
4) urges the relevant members, Mr Watson, and DA Whip, Ms Terblanche,
to refrain from making these irresponsible and uninformed remarks
but to rather be constructive and attend meetings timeously and
regularly.
Ms H LAMOELA: Chairperson, I hereby give notice that I shall move on the next sitting day:
That the Council -
(1) notes with deep regret that 66 000 Gauteng learners, on 12 April
2005, were left stranded due to a one-day strike by school bus
drivers; and
(2) urges the Department of Education to seriously look into this
matter to avoid its repetition as quality education is of vital
importance to our nation.
Mr K SINCLAIR: Chairperson, I hereby give notice that I shall move on the next sitting day:
That the Council -
(1) notes the overwhelming decision of the NNP Federal Congress to disband on the eve of the upcoming local government elections;
2) further notes that, contrary to the conduct of the leaders of the
DA, this decision further unites patriotic South Africans from
different backgrounds in a unified front to address the challenges
of our times;
(3) further notes that, contrary to the disenfranchised DA leadership who, in their own words, and I quote, “will continue the struggle for true democracy”, the majority of loyal South Africans will continue to support the democratically elected ANC government in fulfilling its mandate through the Constitution of the Republic of South Africa as its cornerstone; and
(4) rejects the subtle yet dangerous assertions of the prophets of doom that the conduct of the old NP regime and the current ANC has any relevance.
Ms S J LOE: Chairperson, I hereby give notice that I shall move on the next sitting day:
That the Council -
(1) notes that -
(a) the NNP has now formally joined the ANC;
(b) 257 824 voters supported the NNP in the April 2004
election;
(c) a total of 88 delegates supported the NNP’s motion to join
the ANC; and
2) therefore resolves to –
(a) wish the 88 NNP members bon voyage as they journey into
the ranks of the ANC;
(b) advise the ANC to henceforth audit their membership
records very carefully; and
(c) welcome the remaining 257 736 votes to the DA, further
adding to the DA’s impressive performance as the fastest
growing party in South Africa.
Mr T S RALANE: Chairperson, I hereby give notice that I shall move on the next sitting day:
That the Council -
(1) notes that Zanu PF has won the parliamentary elections held on 31 March 2005 in our neighbouring Zimbabwe;
(2) also notes that the elections in Zimbabwe were free, open, fair, transparent and friendly;
(3) further notes that the Zimbabwe parliamentary elections reflected the will of the people and conform to the regional guidelines for democratic governance;
(4) acknowledges that the peaceful casting of ballots in Zimbabwe is consistent with our objectives of democratising the continent;
(5) congratulates Zanu PF on their resounding victory in the March 2005 poll; and
(6) wishes the people of Zimbabwe success in their future deliberation and return of the country to its erstwhile levels of achievement.
The CHAIRPERSON OF THE NCOP: Is there any objection to the motion?
Ms J F TERBLANCHE: Yes. There is also a point of order: There was an agreement at the multiparty Whips meeting that motions like this would be circulated. We did not receive this motion in time. [Interjections.]
The CHAIRPERSON OF THE NCOP: Order! Order! In the light of the objection the motion may not be proceeded with. The notice of motion will now become a motion without notice.
MOTIONS WITHOUT NOTICE
CONGRATULATIONS TO THE PROTEAS
(Draft Resolution)
Mr G R KRUMBOCK: Chairperson, I hereby move without notice:
That the Council -
(1) notes -
(a) the outstanding performance by the Proteas to win the
second test against the West Indies in Port-of-Spain,
Trinidad;
(b) the record-breaking performance of fast bowler Makhaya
Ntini, who set new personal, Carribean and South African
bowling milestones; and
(c) that the non-racial team fielded by the Proteas was based
on merit and the best possible combination available, which no
doubt inspired the players to excel and succeed; and
(2) therefore resolves -
(a) to congratulate the Proteas on their comprehensive victory
and wish them well for the remainder of the series; and
(b) to further congratulate Makhaya Ntini on his record-
breaking performance – Ntini bowled South Africa to victory
with his world record bowling figures of 13 for 132 and is a
role model for the youth, showing what can be done if they
are determined and use their talents to make their dreams
come true. Phambili, Ntini, Phmbili!
Motion agreed to in accordance with section 65 of the Constitution.
FIREARMS CONTROL AMNESTY CAMPAIGN
(Draft Resolution)
Mr Z C NTULI: Chairperson, I move without notice:
That the Council –
(1) notes the successes of the multi-pronged strategies to bring serious crime under control via specifically the firearms amnesty campaign;
(2) further notes that since declaring the firearms amnesty, a total of 305 592 firearms and ammunition have been removed from society via these multi-pronged strategies, including the firearms amnesty campaign driven by the Department of Safety and Security;
(3) commends patriotic citizens whose participation in these strategies assisted government in ridding our country of violent crimes; and
(4) congratulates the Department of Safety and Security on this programme that further enhances and improves our lives as South Africans in this second Decade of Democracy.
Motion agreed to in accordance with section 65 of the Constitution.
The CHAIRPERSON OF THE NCOP: Order! Hon members, may I just make one remark before I proceed to the Order Paper: I request all members to behave like members of Parliament. We are running an institution that has great dignity and respect accorded to it by the people of the country. Our behaviour is very important in the House.
We may have differences and we may not agree on many other things as a multiparty institution, but I think it is important to respect each other. That is the culture that I personally have grown under and, I think, a lot of us have also grown under it. Even if you disagree with your colleagues you still have to address them with that dignity that they deserve. I think that is very important.
Secondly, regarding the issues that are agreed upon in the Whippery, please, could you resolve them in the Whippery. Let’s not bring them here from time to time as a point to fight over in the House. That is my appeal and I think that is why you have these structures to resolve these issues.
Those are the little remarks that I just wanted to make this afternoon. I hope we could behave like hon members and address each other as hon members with that dignity and respect, and the public will respect us.
ORDER OF PRECEDENCE
(Draft Resolution)
The CHIEF WHIP OF THE COUNCIL: Hon Chairperson, I move the draft resolution printed in my name on the Order Paper, as follows:
That the Council gives its consent that the President by proclamation
in the Gazette extend the period of operation of sections 51 and 52 of
the Criminal Law Amendment Act, 1997 (Act No 105 of 1997), in terms of
section 53(2) of the said Act for a further period of two years, with
effect from 1 May 2005. The CHAIRPERSON OF THE NCOP: Order! I shall now put the question in respect of the motion. The question is that the motion be agreed to. As this decision is dealt with in terms of section 65 of the Constitution, I need to first ascertain very clearly whether all delegation heads are present in the Chamber to cast their provinces’ votes.
I shall now also allow provinces the opportunity to make their declarations of vote in terms of Rule 71, if they so wish. Is there any province wishing to make any declaration of vote? There is obviously none.
We shall now proceed to the voting on the question. I shall do this in alphabetical order per province. Delegation heads must please indicate to the Chair whether they vote in favour or against, or abstain from voting. Eastern Cape?
Ms B N DLULANE (Eastern Cape): We support the motion.
The CHAIRPERSON OF THE NCOP: Free State?
Mr T S SETONA (Free State): The Free State is in favour of the motion.
The CHAIRPERSON OF THE NCOP: Gauteng?
Mr E M SOGONI (Gauteng): Ke a rona. [We support the motion.]
The CHAIRPERSON OF THE NCOP: KwaZulu-Natal?
Mr Z C NTULI (KwaZulu-Natal): IKwaZulu-Natali iyavuma. [KwaZulu-Natal supports the motion.]
The CHAIRPERSON OF THE NCOP: Limpopo?
Mrs H F MATLANYANE (Limpopo): Limpopo ondersteun die besluit. [Limpopo supports the motion.]
The CHAIRPERSON OF THE NCOP: Mpumalanga?
Ms M P THEMBA (Mpumalanga): Mpumalanga supports the motion.
The CHAIRPERSON OF THE NCOP: Northern Cape?
Mr K SINCLAIR (Northern Cape): We support the motion.
The CHAIRPERSON OF THE NCOP: North West?
Mr Z S KOLWENI (North West): North West supports the motion.
The CHAIRPERSON OF THE NCOP: Western Cape?
Mr N MACK (Western Cape): Western Cape supports the motion.
The CHAIRPERSON OF THE NCOP: All nine provinces voted in favour. I therefore declare the motion agreed to in terms of section 65 of the Constitution.
APPROPRIATION BILL
Debate on Vote No 32 – Trade and Industry:
The MINISTER OF TRADE AND INDUSTRY: Thank you, Chairperson of the NCOP, hon members of the House, distinguished guests, ladies and gentlemen. I would like to begin by wishing the chairperson of the select committee, Mrs Nosipho Ntwanambi, a speedy recovery.
Government has developed a work programme detailing key activities of every national department, thus ensuring a co-ordinated and integrated approach to fighting poverty and unemployment. This programme of action, which forms the essence of the people’s contract is available on the government website as a public commitment to delivery. Departments submit monthly reports on progress in respect of these commitments, complemented by izimbizo or media briefings.
This degree of accountability and transparency is unprecedented. Through publishing an updated programme of action on its website, our government is enabling its citizens to monitor its progress in respect of its commitments. Where else in the world would you expect to find such an approach by government?
Our government has performed well at national level, meeting 72% of the commitments in the programme of action within the specified timeframe. This high level of delivery was emulated by the Department of Trade and Industry, which delivered on 13 of its 16 flagship programmes identified last year, with significant progress on the remaining three. Some of our key achievements include the publishing of the codes of practice on Black Economic Empowerment, the merging of Namac and Ntsika into the Small Enterprise Development Agency, the completion of and readiness to launch the Apex Fund, the submission of a co-operatives policy and Bill, and the publishing of a consumer protection policy.
In that period, we have also seen stronger economic performance and high levels of business and consumer confidence. Economic growth was 3,7% in 2004 and it is expected to increase to an even higher level in 2005.
Our growth range, in our view, has increased from the 2% to 3% range to the 3% to 4% range. Our investment rate has increased from 14% to 17% of gross domestic product. Business confidence is at a record high. This positive performance is reflected at the provincial level, with the recent labour force survey statistics released by Stats SA indicating a marked downward trend in unemployment in some provinces.
Unemployment in the Northern Cape decreased from 27,6% in 2003 to 22,3%, and in the Western Cape from 20,7% to 16,9%. This is good progress and we must commit to advancing these gains much further. In this regard, most provinces have hosted growth and development summits involving the social partners, and have established important compacts. We applaud these efforts and commit to fully supporting provinces in the implementation of these agreements.
To reinforce and sustain this positive trajectory, government is focusing on three key areas of intervention, namely increasing the rate of investment, improving levels of competitiveness and broadening economic participation. This requires that we accelerate the microeconomic reform strategy, which is government’s primary strategy to address constraints with regard to economic growth and employment creation.
The co-ordinated implementation of this strategy will ensure that the economy grows in a manner that generates decent work for South Africa’s people and realises the full potential of our country’s resources, diversity and creative energies. Efforts will be intensified to increase investment in key areas of the economy. The customised sector programmes will channel investment into sectors that demonstrate significant growth and employment creation potential such as business process outsourcing and the film and agro-processing sectors, amongst others.
Government will also provide active support to sectors such ad mining, clothing and textiles, which are in distress, with the aim of protecting jobs and enhancing the long-term sustainability of these sectors.
In order to maximise the benefits derived from a more targeted approach to sector development the interventions in priority sectors must, where possible, be mutually reinforcing with provincial growth and development strategies. This requires that the development of sectors of local relevance be well aligned with national strategies to build a growing competitive economy. Our work in sectors will be complemented with the provision of critical economic infrastructure. In this regard, we will continue to promote industrial development zones to work towards a greater geographic spread of industrial activity.
Over the past two years we have also witnessed positive progress in the construction of the IDZs in East London and Coega. Having signalled government’s commitment to support these projects, a number of potential investors have shown interest. Valuable lessons have been gained during the construction process. These include the need to amend the current regulatory framework, better clarification of roles and responsibilities, and the need for enhanced co-ordination across the three spheres of government.
The regulatory amendments will be completed well before the end of 2005. We are also actively engaging relevant departments and entities across the three spheres of government to provide appropriate incentives and services to such investors.
Trade policy is an important component of our efforts to expand market access and increase levels of efficiency and investment in the economy. Continued negotiation for preferential market access and continued expansion of market size through domestic economic empowerment and regional economic integration makes our economy more attractive to both domestic and international investors. It remains important, however, that there should be greater collaboration and coherence between what provinces do to attract investment, and the work that it has done through Trade and Investment SA in the DTI, the foreign economic representatives and the Department of Foreign Affairs.
Increasing underlying competitiveness rather than dependence on a weak exchange rate is critical for the survival and growth of our firms and sectors. A number of incentives are being provided to both large and small business to improve their competitiveness. This includes incentives under the Small and Medium Enterprise Development Programme, the Competitiveness Fund, the Sector Partnership Fund and the Black Business Supplier Development Programme. More than 12 000 employer enterprises have benefited from the Small and Medium Enterprise Development Programme. The Competitiveness Fund supported more than 1 200 enterprises. The Sector Partnership Fund has assisted over 85 successful partnerships consisting of over 600 individual enterprises. The Black Business Supplier Development Programme has assisted over 600 small black-owned enterprises to improve systems, quality, skills and marketability.
We are examining these numbers and those of our other agencies to ensure that we achieve the imperative of strong geographic balance and impact. In other words, we would like to make sure that these numbers are reflective of the different provinces of our country.
As part of our contribution to improving the overall environment for competitiveness, government will address critical pricing structures and deficiencies within the South African economy. This includes streamlining administrative processes and systems, providing cost-effective administered pricing and addressing import parity pricing. Lowering these costs will further stimulate domestic demand and create significant business and employment opportunities. We also need to lower the cost of business at provincial and local levels. We are strengthening the framework for sustainable development.
Government is concerned to ensure reliable, affordable and socially efficient provision of essential services at local government level. The provision of these services is critical for the implementation of the microeconomic reform strategy, particularly ensuring increased economic activity in underdeveloped areas and broadening economic participation.
The provision of an appropriate cost-effective and accessible social infrastructure remains a critical responsibility of government. A comprehensive package of interventions exists to increase the number of persons that are participating meaningfully in the economy. The broad-based black economic empowerment strategy with its regulatory instrument is the overarching framework to broaden economic participation. Complementing the strategy is a number of programmes to facilitate the growth of co- operatives, micro enterprises and small business.
In 2004, the National Small Business Act was amended to provide for the merging of Ntsika and Namac and the birth of an integrated, single, Small Enterprise Development Agency, Seda. Seda will be engaging with the provincial and local governments to set up local offices. The integrated small enterprise strategy will also be rolled out this year. To address the compliance burden on small, medium and micro enterprises, the Department of Trade and Industry, alongside the Presidency and National Treasury, are conducting a regulatory impact review. We are also embarking on a study to institutionalise regulatory impact assessments and minimise the adverse effects of new legislation on small, medium and micro enterprises. My department has already established an impact assessment unit that will monitor the important developments and policy impacts of policies and legislation on the real economy.
Access to affordable finance is a key element of the comprehensive package to broaden economic participation. In this regard, the National Empowerment Fund, the NEF, was relaunched on 31 May 2004 and recapacitated at executive management level in order for it to effectively carry out its mandate.
The NEF was capitalised to an amount of R150 million during 2004-05, which has now been fully committed to BEE transactions. A key development is that the NEF will substantially expand its reach to the poorer provinces. As you would have heard - perhaps many of you heard this - during the Budget Speech of the Minister of Finance, an additional R400 million have been allocated for the National Empowerment Fund for 2005-06.
Furthermore, Khula Enterprise Finance is engaged in the process of repackaging its financing activities and has introduced a new strategic direction that is premised on maximising access to finance through increasing its growth in disbursements by 20% per annum, and expanding the impact through focusing on the geographic spread of its disbursements. More importantly, Khula will improve its impact and outreach by introducing new delivery channels such as Seda access points, as well as by forging new corporate partnerships that have better outreach across the country.
In recognising that the financial services needs of micro enterprises are different to those of small and medium enterprises, the department has established the SA Microfinance Apex Fund. The fund will provide loans of up to R10 000. Various retail channels such as micro credit organisations, financial services co-operatives and Postbanks across all the nine provinces will serve as delivery mechanisms.
The development of co-operatives has also become a critical priority of the government’s strategy to grow the economy, promote broad participation and substantially increase sustainable livelihoods. The DTI is promoting co- operatives across all sectors of the economy. We have completed consultation with all stakeholders on a new co-operatives policy and strategy. The Co-operatives Bill is currently being debated in Parliament.
Indicative of government’s commitment to building the co-operative movement, the work of the department is being strengthened by legislation such as the National Treasury‘s Co-operative Banks Bill and the Department of Agriculture’s Mafisa, which is the agricultural microfinance scheme introduced by the Department of Agriculture. Furthermore, Khula, Seda and other relevant DTI institutions have been given the mandate to strongly support the co-operatives. Instruments to build micro and small enterprises to strengthen co-operatives and to increase access to finance will complement one another to ensure maximum impact. For example, the Apex Fund will be an important tool for facilitating the growth of co-operatives.
The issue of intergovernmental co-ordination has emerged as an important requirement for achieving the goals that we have set for ourselves. There already exists a strong orientation towards getting things done and ensuring province-wide outreach through collaboration between the relevant organizations and institutions. It is essential for economic development and planning that the national spatial development perspective, the provincial growth and development strategies and the integrated development plans are effectively aligned. We are therefore looking forward to a more focused program for our Minmec with a view to deepening coherence and co- ordination to maximise the impact and reach of government’s programmes. The department will interact with local government in a more structured way.
Attention is being given to increasing the specialised skills of the DTI and building its capacity to co-ordinate interventions in the real economy. Key areas for capacity-building are research sector analysis and development, and policy co-ordination. In so doing, the department will be able to attach greater weight to its role in building the real economy.
As highlighted in the people’s contract, we are committed to drastically reducing poverty and unemployment. We realise that economic growth is a means to a better life for all and that all our efforts must ultimately support the creation of more, better and sustainable jobs and livelihoods for the people of South Africa. Hence, in the year ahead, the DTI, through a more active industrial and trade policy, will be hard at work to promote high rates of economic growth, employment and equity. In this regard, the DTI will review its performance indicators to ensure that it is making the best contribution it can to fulfil the people’s contract.
We therefore table Vote 32 for your approval. I would like, at this point, to thank the hon MECs and heads of department that are present today, as well as the leaders of the different institutions that work with the DTI, for their co-operation and support. I would like to thank Lindiwe Hendricks, the Deputy Minister, for her wisdom, strength and friendship, which are greatly appreciated. I want to thank the staff of the DTI and its agencies, and a special thank you goes to the former director–general Allister Ruiters for his contribution to the restructuring of the DTI. Finally, my congratulations go to Mr Tshediso Matona, who will be the acting director-general until a new director-general has been appointed. Thank you very much. [Applause.] Ms M P THEMBA: Hon Chairperson, hon Ministers, hon members, I am standing in for the Chairperson of the Select Committee on Economic and Foreign Affairs, Ms Ntwanambi, who is not well. We all wish her a speedy recovery. I also wish to send our condolences to the Mpahlwa family on the lost of their beloved father. Sitsi akwehlanga lungehlanga, thuthuzelekani. [We are saying that what has happened to you is not something that has happened to you alone, be comforted.]
Hon Chairperson, a major challenge this country continues to face is how to achieve higher rates of economic growth and development, reduce the level of unemployment and eliminate poverty. To address these challenges, we have engaged in very extensive processes of the restructuring of our economy, to break away decisively from the status quo imposed on it by successive apartheid regimes.
Accordingly, among other things, we have sharply reduced the budget deficit and consistently pursued the objective of maintaining fiscal discipline, and worked to improve the economic and social infrastructure. We have continued with the work to restructure the state corporations, which includes partial or complete privatisation, and built a stable, consistent and transparent legislative policy and regulatory framework which enables all economic actors, both domestic and foreign, to take their decisions in an atmosphere of certainty.
I would like to use this opportunity to inform you that the achievements of the ten years of democracy in 2004 highlighted the major political and economic change that has occurred in South Africa since 1994. The political, economic and social changes, since 1994, have been driven largely by the choices made by government. These choices are reflected in government’s Budget allocations and priorities in government allocations.
The achievements of the past ten years to undo apartheid’s economic legacy and place South Africa on a new path has been characterised by economic growth that is shared by all South Africans. I do not wish to repeat the many accomplishments of the ANC-led government in this regard. However, allow me to remind this House that in 1994 the South African economy was on the verge of crisis and South Africa faced the real possibility that the economy would de-industrialise.
Since 1994, there have been significant changes in the structure of South Africa’s economy. The reliance on primary commodities has halved since 1994 and new sectors, particularly services sectors, have become important contributors to the economy.
The Minister of Finance said in his 2005 Budget Speech that the Budget contains more for all, reflecting government’s intention to spread the benefits of South Africa’s growth a decade after apartheid ended. The DTI is an efficient and effective department capable of delivering on its mandate. The department balanced its budget in the last financial year. Significant improvements have been made in employment equity in the department, especially in regard to the appointment of women, particularly black women managers. One third of chief directors and more than half of the department’s deputy directors-general are women.
Today, we have a more vibrant and a more robust economy in ensuring a higher level of economic growth, more jobs, less poverty and more equity by
- We can only achieve these goals by ensuring that in the next few years we work to increase the contribution that small enterprises make to the economy and make significant progress with regard to broad-based black economic empowerment.
We need to increase the level of investment in the economy overall and in priority sectors, as well as expand market access opportunities for our goods and services, and we need to raise export levels.
As the DTI we will contribute towards building skills, technology and infrastructure platforms that enterprises can benefit from, and seek to reposition the economy in higher value-added manufacturing and services activities. The creation of new enterprises and the development of existing enterprises are crucial.
As the champion of broad-based black economic empowerment, the DTI must lead the way for the rest of government in terms of procuring goods and services from black and women-owned enterprises. Thus, we need to commit the DTI to procuring not less than 50% of required goods and services from black and women-owned enterprises.
All enterprises, whether they are small in size and owned by emerging entrepreneurs or huge South African multinationals, need to benefit from an economy that has a lower cost structure. Lowering the cost structure of our economy is a central aim of government’s Microeconomic Reform Strategy. The DTI needs to look at the role to be played by competition policy in this regard.
As the President has articulated so well in his state of the nation address this year, many South Africans, and women in particular, are excluded from the fruits of the first economy and are unable to take advantage of the increasing number of economic opportunities because they do not have the right skills; they are not able to get information easily about these opportunities and about support available from government; and they are not able to collateralise their assets to start their own enterprises.
These South Africans toil in the second economy, engaged in mainly survivalist activities, and are particularly vulnerable to the marginalising tendencies of the economic phenomenon we have come to call globalisation. This presents a major challenge to this government and to the DTI.
We need to build a single economy that benefits all South Africans; an economy in which the rate of unemployment is halved over the next ten years, in which the incidence of poverty is halved over the next ten years, an economy characterised by higher levels of equity, and an economy that is growing and creating more and more economic opportunities.
This is the mandate that we have been given by the people of South Africa. And it is this mandate that provides the starting point for the DTI’s work programme over the coming years.
Many ordinary South Africans do not actually know where to turn for assistance when they have problems that are of a commercial nature: when they are wrongly blacklisted by a credit bureau, when something they bought doesn’t work properly, or when their monthly instalments for new furniture is much higher than what the retailer advertised. We need to focus on consumer protection, especially in respect of consumer credit issues like indebtedness and reckless lending.
Allow me to focus on one particular programme within the DTI, namely, Trade and Investment SA. This programme aims to provide strategic vision and direction to key growth sectors in the economy, to increase the level of direct investment flow and to develop South Africa’s capacity to export to various markets.
Now, when the DTI reports, as it did in the 2005 Estimates of National Expenditure, that 50% of its export marketing and investment scheme recipients were SMMEs, this shows commendable amounts of commitment to government’s programme to foster SMME development. This is really very good.
As I have said before, the developmental state can only be fully realised by government working with the private sector to ensure equitable economic growth.
Now, the DTI announced in 2003-04 that there would be a shift to internal investment creation. Unfortunately, most of the private sector lagged behind public sector companies in terms of domestic investment, but there have been encouraging signs recently that this situation is improving.
It is, however, imperative that the rate of domestic private sector investment is sped up to further grow our economy. It will also have positive effects in terms of attracting foreign direct investment to our shores.
South African citizens can also influence economic growth by, amongst others, supporting the Proudly SA Campaign both at home and abroad. It is imperative that business and consumers show patriotism and pride when it comes to the South African economy and our goods and services so as to promote confidence amongst foreign investors.
The announcement by the DTI that it has set itself the objective of promoting direct investment into certain sectors thus becomes very important in terms of growing the domestic industry. The DTI plans to have a customised sectors programme developed by the end of August and to start implementing high-impact projects by September 2005. It is our sincere belief that these projects in, amongst others, the aerospace and paper and pulp industry, will create employment opportunities and thus assist in the fight against poverty.
It is also encouraging to note that the DTI is addressing the decline in sectors such as clothing and textiles by engaging with employers and unions to look at a combination of short-term safeguards and longer term issues of industry investment and underlying competitiveness. The ANC-led government is very much aware that this sector has real economic and social significance in our economy, especially in the Western Cape. [Interjections.]
In conclusion, let us remain aware of the people’s resolutions of 1955, as they are still relevant today. We must ensure that all South Africans share in the country’s wealth. Thank you, hon Chairperson. [Time expired.] [Applause.] Mnu D D GAMEDE: Sihlalo, Ngqongqoshe nePhini likaNgqongqoshe, thina njengo- ANC, uKhongolose, siyakuqonda ukuthi inhloso enkulu yalo mnyango nohulumeni ukwenza isimo sokuhweba nokuthuthuka kwamabhizinisi sihambisane nesimo esiphila kuso sentando yeningi, nokwenza ukuthi bonke abantu baseNingizimu Afrika bathole amathuba afanayo kwezomnotho nakwezamabhizinisi.
USomqulu weNkulululeko ukubeka ngokusobala kucace bha ukuthi bonke abantu baseNingizimu Afrika mabahlomule emnothweni wezwe. Yingakho nje lo mnyango nohulumeni oholwa uKhongolose benemigomo kanye nemithetho eshayiwe yokufeza lezi zinhloso.
Izinkulungwane eziyishumi nambili zosomabhizinisi abancane bathole ukuxhashwa yilo mnyango nge-Small and Medium Enteprise Development Programme. UKhula usesize osomabhizinisi abancane ngemali eyizigidi ezingu- R337. I-IDC isifake imali engamarandi angu-3 bhiliyoni yokusiza izimboni. I- Black Business Supplier Development Programme namhlanje ixhase osomabhizinisi abangama-528.
Lo hulumeni oholwa uKhongolose ushaye umthetho ophoqayo ukuthi abantu ababencishwe amathuba kuqala kube yibo okuqalwa ngabo ukunikezwa amathuba. NgoJuni wonyaka ka-1955 iningi labantu baseNingizimu Afrika labuthana eKliptown lapho bavumelana khona ngokuthi iNingizimu Afrika ngeyabo bonke abantu abayakhele. Kanjalo nomnotho wezwe ungowabo bonke abantu.
Uhlelo lokunika abantu abamnyama amandla kwezomnotho, i-black economic empowerment, eyahlongozwa yaphasiswa yilo hulumeni oholwa nguKhongolose isizishintshile izimpilo zabantu abaningi lapha eNingizimu Afrika. Isibonelo nje sokuqala ukuthi eThekwini, KwaZulu-Natali, sizwile kula masonto adlule ukuthi uNkk Vino Govender uhlomululile ngalolu hlelo ngezinongo zakhe zikakhari. Lokho kuwubufakazi bokuthi uhlelo lwe-BEE olwabo bonke abantu.
Okwesibili, khona lapha eNtshonalanga Koloni kade sizwa ngisho kwi-Business Report kula masonto edlule ukuthi abasebenzi basemapulazini bahlomulile ngokuthola ipulazi lewayini osekuzoba ngelabo. Lokhu kusho ukuthi kuwukuhhuma nje ukukhuluma kwabanye abantu abathi lolu hlelo lwe-BEE olwedlanzana ngoba abantu laphaya phansi bayawathola lawa mathuba aphuma kuhulumeni. (Translation of isiZulu paragraphs follows.)
[Mr D D GAMEDE: Chairperson, Minister, Deputy Minister, we as the ANC understand very well that the intention of this department and the government is to create conditions to bring the economy and trade in line with democracy and to ensure that all South Africans get equal opportunities in business and the economy.
The Freedom Charter clearly states that all South Africans shall share in the country’s wealth. It is for this reason that this department and the ANC-led government have passed policies and regulations to achieve these objectives. Twelve thousand small emerging businesses were subsidised by this department through a small and medium enterprise development programme. Khula Enterprise has assisted emerging businesses with R337 million. The IDC has contributed R3 billion to help these enterprises. The Black Business Suppliers’ Development Programme has so far assisted 528 businesses.
This ANC-led government has passed the legislation that gives preference to those who were previously marginalised. In June 1955 the South African population gathered at Kliptown, where they declared that South Africa belongs to all who live in it. The wealth also belongs to them.
The programme called black economic empowerment that was passed by the ANC government has changed the lives of many South Africans. One example, in Durban, KwaZulu-Natal, is Mrs Vino Govender’s spice business that benefited through this programme. This clearly indicates that this programme is for everyone.
Secondly, we have seen in Business Times that here in the Western Cape farm workers have benefited by acquiring wine farms that will be theirs. This shows that what they are saying at grassroots level, that this programme benefited a select few, is nonsense since people are getting these opportunities from government.]
Infrastructure, strategies and investment plans to the tune of R180 billion for transport logistics, electricity and water resources are in the pipeline. All major power stations will be refurbished, for example in the Mpumalanga province, and thousands of jobs will be created. There are major investments for the Durban and Cape Town harbours. A new pipeline between Durban and Johannesburg is to be constructed. This would mean an approximate GDP growth of R5,86 billion by Eskom by 2007. Surely, the ANC- led government is very serious about development.
Nokho siyazi ukuthi sinazo izinselelo ezisasisalele. Phela ukulungisa umonakalo owalethwa ngababusi bobandlululo, okuyinto abayenza amakhulu ngamakhulu eminyaka, ngeke kwathatha iminyaka eyishumi kuphela nje. Lo hulumeni oholwa ngu-ANC manje usunikeze abesifazane amathuba, njengoba ozakwethu abanye kade besho. Lo mnyango usuzibophezele ukuxhasa abesifazane abangama-500 ukuze bathuthuke kwezomnotho.
Enkulumeni yakhe, uMongameli wezwe uthe, uma ngicaphuna amazwi akhe: (Translation of isiZulu paragraphs follows.)
[We are aware that there are still challenges. To rectify the damage that was done hundreds of years ago by the then regime could not be rectified in ten years’ time.
The ANC-led government has given opportunities to women, as indicated by other speakers. This department has committed itself to support 500 women for economic development.
In his speech the President mentioned some of the achievements:]
Our programme for the coming year is premised on the broad objectives to increase investment in the economy, lower the cost of doing business, improve economic inclusion and provide skills required by the economy.
Nakhu-ke okunye osekwenzekile - okunye kubalwe uNgqongqoshe futhi lokhu kukubeka obala lokhu okushiwo abanye ukuthi imiqondo ekhaliphile icabanga ngokufanayo.[Other things have been mentioned by the Minister that clearly indicate what have been said by others, i.e. great minds thinks alike.]
The following aspects are what we have achieved so far: We have amended the National Small Business Act, in order to make provision for the establishment of the Small Enterprise Development Agency hence the extension of the mandate of Seda to include co-operatives. We have higher rates of investments, more market access opportunities and higher levels of exports. Most importantly, we are contributing to African economic development and thus bridging the economic divide between the first and the second economy.
As mentioned earlier on, we now have the National Empowerment Fund, which was relaunched. What needs to be done now is to complete a national audit on the economic status of women and also implement and monitor the broad- based black economic empowerment strategy, BBBEE, accredit BEE guidelines for the manufacturing and retail sectors, and then make R400 million available for the capitalisation of the National Empowerment Fund.
Uma sengigcina, ngifuna ukuthi uKhongolose uyinhlangano yabantu. Uyinhlangano yoquqaba. Uyinhlangano eyaziyo ukuthi abantu badingani. Izinhlelo zokushintsha izimpilo zabantu ukuze zibe ngcono ziholwa u-ANC nalo nomnyango. Lo mnyango ungenye yezinqola zokuletha impilo engcono kubo bonke abantu baseNingizimu Afrika. Thina singu-ANC sithi siyakwesekela ukuphasiswa kwale sabiwomali. Ihlombe.
[In conclusion, I want to say that the ANC is the organisation for the masses. It is the organisation of the masses. It is the organisation that knows people’s needs. This department and the ANC lead the programmes to create a better life for all. This department is one of the wagons for delivery and the betterment of life for all South Africans. The ANC supports this Budget Vote. [Applause.]]
The CHAIPERSON OF THE NCOP: Thank you, hon member. I have been informed by hon members that there is a lack of interpreting, again, up there. Could the officials please deal with this matter? We had this problem yesterday and we have it again today. I don’t know what these technical things are up there. Please, let us have an interpretation service.
Mr P NGCOBO (KwaZulu-Natal): Thank you, Chairperson and the Minister. I am speaking here for the first time after KwaZulu-Natal has been liberated for the first time in its history. [Interjections.] When we took over in KZN, we found that things were in tatters. As usual, we had to introduce corrective measures to ensure that we sort out the mess that was there before.
Economic growth has been taken very seriously in KZN by the new government that was appointed by the masses there. What the government decided to do to start the process was to set up a sum of R500 million, which is there to stimulate economic growth, because we could see that we were not making inroads in this regard.
We have also set aside moneys to stimulate economic growth in various towns that were facing on economic crisis because some companies that were set up in the homeland areas could not sustain themselves because they had been promised things that the new government could not sustain. As such, they had to close down their shops, and we are now coming to their rescue in areas such as Mooi River, Dundee and the upper Northern Natal areas.
All of us have been talking about the fact that SMME companies are finding it difficult to access funding from ordinary banks. As such, the Ithala Co- operation has been put centre stage with regard to this bold initiative. What the government has said to Ithala recently is that because it is an organisation that is in the hands of the state, it will be important for it to take a risk. As such, a sum of R200 million was set aside to assist SMMEs, because when they go to the ordinary banks they are told that they are too risky. We said to Ithala that it is better that we play this role; we have been voted in by the people to take that risk because the private banks are not prepared to do it.
The provincial treasury set aside a sum of R200 million, which will be used by Standard Bank, because Standard Bank is the one that is running our account of R45 billion. We said to Standard Bank that if they want some of this R45 billion to manage, they have to plough back into our community; they have to do something for the SMMEs. They agreed to come to the party. The condition is that they ensure that when SMMEs approach them, the SMMEs are going to get loans from Standard Bank. This is different from other banks, but it is a special arrangement that has been entered into by the government and Standard Bank, as well as Ithala.
Our government has never been as ready as it is now to have a proper tourism industry that will prosper and grow. We are committed to have King Shaka Airport and Dube Port ready by 2009, before the 2010 World Cup.
I know that the media has sent out many mixed signals, saying that we are not ready, but I can tell you that the new government is ready, and we will make sure that by 2009 you will be landing at a new airport called King Shaka Airport.
We all know that there has been a very serious problem with the terminals at the Durban and Richards Bay port, but the provincial government intervened and today I can tell you that everybody who is doing business through that port is happy about what is happening and the progress that has been made there.
The recent exchange programme between the Republic of China and KwaZulu- Natal has resulted in our province sending a number of young guys to Cedara College so that they can learn how to produce rice and mushrooms. We are no longer going to import rice to KwaZulu-Natal. It is going to be cultivated by our own people in the rural areas. So when we talk about economic growth, go down there and you will see it in action. We are banning this wisdom that rice will always be imported. Our people in the bundus are the ones who will produce this.
Last year, our Premier hosted the Growth Economic Summit, whose aim was to ensure that government, business, society and labour are all singing from the same hymn book, and we have just achieved that. If you go to any department, the central document that is used is the document that arose out of that summit. It is central to what the government is doing in KwaZulu-Natal.
The question of broad-based economic empowerment has been taken very seriously by our government in the sense that if companies do not want to have 40% partners in their companies, they cannot do business with the government of KwaZulu-Natal. That message has been going out very clearly to them, that if they want to do business, they need to have 40% of shareholders coming from the historically disadvantaged individuals, HDIs. The supply-chain management will see to it that they do away with the central procurement committees back to the heads of departments, which will force them to ensure that HDIs are brought to the mainstream of our economy. Our R45,5 billion buying power cannot fail us as the ANC.
Trade Investment KwaZulu-Natal has now managed to streamline the international trips that were undertaken by mayors with a view to attracting international investment. What used to happen before is that we took over all the mayors of a district. There is one that even set up on international desk in his district, so he deals with the international investors. So when we came in, we asked: What is this? Who is supposed to be marketing the province outside the province except the province itself? There is no longer a district that is allowed to go and talk about what they can do; even lowering their labour standards, something that they cannot achieve, because Patel is there to deal with them.
We said it had to be streamlined, and it is now driven from one central point, and that is Trade Investment KwaZulu-Natal. As I have said, there is only one structure to deal with the international community.
One fundamental issue is the issue of setting up companies. This issue has been raised with us by TEAC, who said that in Australia it takes them three days to set up a new company, but here only God knows how long it takes for us to set up a company. I think that is a challenge that we will need to deal with, because if we are serious about economic growth, we need to look at the laws that we are passing and see whether they are really doing what the ANC has sent us all here to do.
Lastly, our province set aside more than R50 million to stimulate our co- operatives. If Comrade Blade was here, he would be very excited about the fact that for the first time in KwaZulu-Natal we have set aside R50 million to set up the co-operatives. Right now the Minister is having road shows, talking to the community about how they can access this funding. It’s a new concept, but all of us are very positive about it. We feel that it can do what we have set ourselves to do. I thank you very much, Chair. [Applause.]
Ms J F TERBLANCHE: Hon Chairperson, hon Ministers, the hon Minister told us today that government realised that economic growth was essential for the welfare of all our people and that job creation was one of his priorities. I am pleased he focused on this, because it is the DA’s greatest concern and one that I will address today.
The latest figure from the Labour Force Survey, LFS, indicates that 26,2% of the total working population is unemployed. A broader definition that includes discouraged workers places the figure even higher at 41%. This situation cannot be tolerated.
The DA calls on the Department of Trade and Industry to implement the strong measures required in order to reverse the tide of job losses and to start making inroads into the substantial unemployment rate.
The force of globalisation is being felt in local industries. Job losses across the spectrum of industries have arisen largely as a result of companies attempting to remain competitive in an unforgiving international market. The strong rand and the influx of cheap imports into South Africa have further aggravated this situation. In 2004 in the textile industry alone 17 000 jobs were shed.
However, to date the Department of Trade and Industry has failed to mobilise effectively on this issue. Last year, the task team appointed by the DTI to address problems threatening the textile and clothing industry met only three times. In addition, the department failed to respond timeously to letters from the Textile Federation and numerous textile firms. An apathetic response cannot be countenanced. The Department of Trade and Industry must acknowledge the seriousness of the situation and formulate a clear, proactive response.
The government has embarked on trade liberalisation programmes at a faster rate and to a greater degree than is required by the GATT agreement and the World Trade Organisation. As a result, domestic industry has not been given sufficient time to adjust, with devastating and far-reaching consequences for the numbers of unemployed.
The DA believes in free, but also, fair trade. Whilst the DA supports trade liberalisation, local industries must be allowed to adjust accordingly. In certain isolated situations in which significant industry breakdowns occur, the use of tariffs and quotas should be allowed for a limited period of time. An example is the threatened textile industry, in which South Africa has been permitted by the World Trade Organisation to use certain exemptions. Local industries cannot simply be told to adapt or die.
Textile firms in South Africa were established under a system that protected the industry from the ravages of international competition. Furthermore, firms enjoyed the benefits of both tariffs and quantitative restrictions. Textile firms, therefore, need to be given incentives to make the adjustments demanded by government’s policies.
The government should not be intervening on behalf of sectors or businesses whose businesses, for technical or practical reasons, are no longer economically viable. The department should be considering ways to reorientate industries that are no longer able to compete. The DA proposes that the DTI offer firms comprehensive adjustment packages in order to restructure. In this way, the department will prevent substantial job losses in threatened industries.
There is an inherent contradiction in the government’s policies. Whilst advocating free-market principles, the government has not simultaneously liberalised the rigid and restrictive labour legislation in this country. To quote Richard Wadley, a Kumba Resources director, “The government needs to create a legislative, fiscal and regulatory environment that will allow efficient, effective operators to compete in the global market.”
The responsibility falls on the Department of Trade and Industry to effect measures in this regard. Provision in the budget needs to be made for the additional expenditure relating to restructuring incentives.
The DA has recognised that the Department of Trade and Industry has a number of agencies under its control in which there appears to be little distinction in terms of roles, resulting in an overlap of activities. The DA has identified the enterprise development function as a key example of agency role duplication. The Enterprise and Industry Development Programme and the Enterprise Organisation Programme replicate the enterprise development function within the DTI. This function should be consolidated within a single programme.
Furthermore, the DA believes that Trade and Industry SA should be streamlined, as it is a costly initiative relative to other DTI programmes. In total, these measures would result in estimated savings of R456 million.
The creation of sustainable employment for the 18 million unemployed needs to be recognised as the number one national imperative. At the very least, existing jobs in industries need to be protected against the effects of globalisation. In order to achieve this, the DTI must find ways to reorientate industries to adapt to a changing marketplace. I thank you. [Applause.]
Ms P C NGWENYA (Mpumalanga): Thank you, Chairperson.
Sihlalo, singaba nemehlo sonkhe kodvwa ngeke sibone ngalokufananako. Singaba nengcondvo kodvwa ngeke sicabange ngalokufananako. Ngicabanga kutsi loku lesikuva ngetindlebe tetfu akusiwo umhlolo kodvwa kulihlaya. Loku lesisandza kukuva nyalo yindvo leyetayelekile. Uyati kutsini? Bantfu nababanga umsindvo kusuke kukhombisa kutsi Litiko kukhona lelikwentako. (Translation of Siswati paragraph follows.)
[Chairperson, we may have eyes but we perceive differently. We may have brains, but we think differently. I think what we are hearing with our ears is not a myth, but a joke. What we have just heard is the same thing. You know what? When people grumble, it implies that the department is doing something.]
I think people voted for the ANC trusting that nothing will be impossible and that everything will be possible. I think when we talk or present our proposals we don’t need to talk about our concerns or ourselves but we need to indicate the concerns of the people.
Again, I think we need to appreciate good things. I don’t know whether I have to go back and check my dictionary so that I can really find out the meaning of the word opposition - whether you just oppose everything that is coming just for the sake of opposing, instead of analysing things and getting facts.
Hon Chairperson, hon Minister and Deputy Minister, members of the NCOP, members of the executive councils of the different provinces present here today, fellow members of provincial legislatures, government officials, fellow comrades and friends, about 50 years ago, under the leadership of Comrade Chief Albert Luthuli, the ANC and other democratic people’s organisations, such as the Congress of Democrats, the Coloured People’s Organisation and the SA Indian congress, brought together freedom-loving people of South Africa to put together minimum demands in the form of the Freedom Charter, which was adopted at the Congress of the People on 26 June
- The Freedom Charter, which is more relevant today, spells out in one of its clauses that “The people shall share in the country’s wealth.”
I wish to suggest that this clause calls for all of us in this Council to ensure that our economy develops and grows, to provide the material base that will enable us to defeat poverty and underdevelopment, and create better jobs as envisaged in the 2004 election manifesto of the people’s movement I have the honour to serve.
Our political vision has always been one of a prosperous, equitable and democratic society. In terms of that vision, we are called upon to ensure the creation of decent work and living standards for all. We have an obligation to improve equity in ownership, management skills, access to opportunities and control of the means of wealth as envisaged in the Freedom Charter.
As Mpumalanga province we agree with the Minister’s statement that it is not enough to rely on a weak currency to drive exports. It is against this background that the saying, “think globally and act locally”, is more appropriate to us.
The province’s department of economic development and planning has started to develop the province’s own response to globalisation and the integration of our economy into the world’s economy. The following strategic directions have been identified, namely, stimulating investments, building competitive export clusters, establishing local entrepreneurial communities, branding Mpumalanga locally and globally, creating an alignment of strategic intent; developing knowledge and skills, and advancing innovations.
We also welcome the Minister’s continued commitment to the advancement of the broad-based black economic empowerment policy, and in particular the introduction of the Co-operatives Bill. We believe that there could be no other practical way to achieve the ideals of the Freedom Charter of wealth redistribution directed at raising the standards of living of especially the poor in general and previously disadvantaged individuals in particular, and improving the social and economic wellbeing of the population of the country.
It is thus critical that we direct substantial investment towards economic and social infrastructure that is built by means of a method that is biased towards labour intensive technologies, as envisaged in the Expanded Public Works Programme. Co-operatives provide specifically for the participation of the largest section of our people in the economy.
We also welcome the decision to roll out offices, which provide finance for micro and small businesses, as this would make access to funding even easier. In the province, a process has already been started to reorganise government parastatals, which are responsible for providing finance for small and micro businesses to avoid the duplication of services provided by government.
The establishment of offices such as the Seda offices would help to ease the financial constraints that the province face with regard to the funding of small businesses and will further assist in bringing the services nearer to the people.
In welcoming and supporting the budget, as presented by the hon Minister, I also wish to remind this Council of the words of Charles Dickens in his book, A Tale of Two Cities, that we are coming from “the worst of times”, “the age of foolishness”, “the season of darkness”, “we had nothing before us”, and so we were going direct to hell.
The budget itself shows a people-centred approach as the fundamental principle and the road map towards the advancement of the Freedom Charter. It further entrenches that the national wealth of our country, the heritage of South Africans, shall be restored to the people.
There could be no better response to the challenges posed by the second economy, which constitutes the structural manifestations of poverty, underdevelopment and marginalisation in our country, as stated by the President in his state of the nation address on 21 May 2004.
Mpumalanga has convened the provincial growth and development summit where the government and the private sector made a commitment to ensure that the resolutions taken at that summit are implemented. I think we need to work together to create work and fight poverty. We know that development is not an event but a process. People need to be patient, there is hope. We are going to Canaan. We will see it and enjoy the fruits there.
In conclusion, I wish to quote former president Nelson Mandela, who summed up the end of the first five years of our democracy in 1999 as follows:
The profound changes of the past five years make the distance travelled so short, the end so sudden. Yet with the epoch-making progress that has been made, this period could have been so many decades. The journey that we have thus far travelled gives us confidence that we shall reach our goal of a society that truly cares.
I thank you, Chairperson. [Applause.]
Ms M N MCHUNU: Chairperson, hon Ministers present here today and Deputy Ministers, hon members from provinces, hon colleagues here today, it is an honour indeed to be involved in a debate of this magnitude as it touches the core of the lives of the people, especially the poor and the unemployed.
The vision to create this department is worthy of praise, but more so as it plans to work according to observable and feasible objectives that will reduce unemployment and abject poverty.
“The people shall govern!” …[Applause.]… as the ostracised people said in 1955, and govern they will, with the power of their soul, with their mental powers and physical strength. I commend the government by the people, for the people, with the people. In this setup everybody is part of the government and all contribute to the growth and sustainability of the economy and the government.
KwaZulu-Natal supports a modern and well-functioning economy run by the government with the people. If people are involved, there will be concern for success, productivity, stability and healthy competitiveness. Equitable access to information and opportunities may encourage people to work harder.
And, I commend my brother, Mr Ngcobo, who has told you about all that is being done in KwaZulu-Natal, and the ANC found fertile ground for development. We are successful all-round when it comes to development. And it is not a ten-year story; it is a story going right back to 1910. You know the story.
The well-populated province of KwaZulu-Natal, with 9 million people compared to other provinces, requires labour-intensive undertakings in building the economy. Entrepreneurs need training and financing.
Again the processing of the Co-operatives Bill is commended, and I commend our hon Minister for that. People themselves have to lead the economy by putting their own money down for projects and then have the government top it up by way of grants or loans. A pocket with holes cannot keep money, so people have to demonstrate that they can manage finances by starting with primary co-operatives or credit unions and then move to secondary or tertiary co-operatives.
In fact, we have had co-operatives and credit unions as far back as 1972, when churches collaborated with co-operatives. In the 1980s we officially started primary and secondary co-operatives. We have a centre where this training is done. We also have various dealings with banks, and that is the reason the ANC was trained by Mrs Shandu in dealing with co-operatives. You know the story, Mr Ngcobo.
Women and the youth have to be at the forefront of working with the Department of Trade and Industry. Women are innovative, and no burden is too heavy for them to carry. They are the powerhouses.
The youth has to be groomed into a workforce that saves money and creates wealth. Young people form the bulk of the unemployed people. As the DTI policy touches on job creation, industries have to be labour intensive, where possible. Industries have to be given incentives as well in order to co-operate with the labour-intensive guidelines.
There has been concern that the firms we have in KwaSithebe and Ezakheni are underpaying the people. Yes, that could have been the case, but the feeling is that half a loaf is better than nothing.
We are pleased that today the ANC agrees with the IFP, that jobs must be created and things must be done. [Interjections.] Capital-intensive development is good in that it builds the economy of a country. But if it uses high technology only, it disadvantages the poor people and contributes to unemployment. Unemployed people then commit crime, because they are doing nothing with their hands. [Time expired.] The DEPUTY MINISTER OF TRADE AND INDUSTRY: Sihlalo, malunga ahloniphekileyo, kuyinjabulo enkulu kimina ukuthi ngibe la namhlanje, ngiphelezela uNgqongqoshe, sizokwethula phambi kwale Ndlu isabiwomali soMnyango wezoHwebo nezeziMboni.[Chairperson, hon members, it is a great pleasure for me to accompany the Minister and to present the Budget Vote for the Department of Trade and Industry here in this House.]
The impact of apartheid planning and the uneven concentration of resources in certain geographical areas have resulted in an imbalance of economic development amongst the nine provinces of our country. Through the efforts and resources of the Department of Trade and Industry and the Council of Trade and Industry Institutions, and in partnership with provincial and local governments, we have a mandate to address these disparities.
The tendency in our country is that existing successful locations attract investment. Some 80% of South Africa’s manufacturing output is still produced in six metro areas, and the estimates of the 2004 GDP per region from Stats SA indicate that the leading regional contributors to the national economy are Gauteng with 33%, followed by KwaZulu-Natal with 16,5% and the Western Cape with 14,5%. These provinces are also generally experiencing faster growth rates than the other provinces.
Our approach must, therefore, be to make the underdeveloped regions of our country more attractive for investment, while continuing to support growth in our economically stronger provinces. All the regions of our country have the potential for significantly faster levels of economic growth, and we need to unlock this latent economic potential. In doing so, we will be addressing some of the key challenges facing our country, and that is reducing the high levels of unemployment and increasing the participation of our people in the economy.
In order to attract investment, we need to identify the economic potential in an area. This economic potential might be in the area of tourism, mining or agriculture, or it might be in the telecommunications or manufacturing sectors.
To this end, the Department of Trade and Industry’s geographic spread unit, which was established to promote a more equitable spread of investments, conducted research and identified opportunities in our economy. This culminated in the establishment of a geographic information system that contains a range of economic data from across the country. On the basis of this information, we are better able to attract suitable investors.
My department, through Trade and Investment SA, our foreign offices and in partnership with provincial investment promotion agencies, is working hard to attract international investors to our country. We must, however, ensure that our people are also able to take advantage of the opportunities available, and in this regard the DTI offers a number of incentives to support domestic investors.
The DTI’s regional offices are also in place, so that they can inform businesses in provinces about the incentives that we offer and advise them on how to access these opportunities. An additional tool available to the government to attract investments and stimulate regional economies has been to increase infrastructure spending, for example on roads, ports, telecommunications, electricity, etc. Such spending will be dramatically increased by government over the next few years.
This often stimulates an increase in private sector investment among those who are keen to take advantage of the improved access to new markets or inputs created by the infrastructure development. This approach informs the industrial development zones, which the Minister spoke about in his address.
A critical aspect of addressing the spatial underdevelopment of our country to ensure that we are empowering and providing adequate support to small businesses. Small businesses and entrepreneurs are increasingly playing an important role in local economic development, and as the DTI we have been working with the municipalities in supporting this, mainly to train their local economic development officials to be able to explain the incentives of the DTI and what programmes and projects are available in the DTI for the local community.
To achieve the desired impact, we need to have high levels of co-operation and co-ordination between the different spheres of government and state- owned enterprises. In an effort to ensure properly focused development planning for the future, the Cabinet has aligned the national spatial development perspective with the provincial growth and development strategies and the municipal integrated development plans.
Importantly, the national spatial development prospective provides a platform for engagement among the three spheres of government around critical issues of policy implementation and strategies for growth and development. This has helped to facilitate dialogue between the spheres of government about the country’s special priorities, infrastructure investment and development spending.
To achieve the desired impact, we need to direct the skills and support that exist in the DTI agencies so that they are able to unlock the opportunities in our economy.
Yesterday, in my address to the National Assembly, I spoke about the improved ability of the DTI to direct and mobilise the efforts of our agencies. These agencies are working in the areas of development finance, regulatory issues, international trade issues and specialised service institutions that deal with small business development, with women in business, as well as quality standards, technology and innovation.
For those of you who are not aware, these agencies consume about 41% of the department’s budget and the collective asset base of these institutions exceeds R30 billion, and the group employs altogether more than 5 000 people.
The Small Enterprise Development Agency, as well as the development finance institutions, such as Khula, NEF, IDC and the soon-to-be-launched microfinance apex fund have a critical role to play in supporting our efforts to promote growth in the underdeveloped regions of our country.
Our support programme for women in business has also started to make significant impact. The trend of assuming that young women from rural areas are unable to participate in the information age has been bucked by our Technology for Women in Business programme. TWIB, in partnership with Cisco Systems, has successfully established an IT academy that is training young women from the Tombo region in the Eastern Cape in advanced computer networking skills.
Furthermore, women in business from across the country have joined and are actively participating in the SA Women Entrepreneurs Network, SAWEN for short. We look forward to the upcoming first-ever annual general meeting of this organisation.
Other DTI agencies, such as the SA Quality Institute, the SA National Accreditation Society, the SA Bureau of Standards and the Technology and Human Resources for Industry Programme that are involved in areas of quality, standards and technology are also critical players in our efforts to improve the effectiveness and competitiveness of businesses across the country. The location of a business should, in our opinion, not be a determinant of the quality of its products and its ability to innovate.
To conclude, hon members, our country has enormous potential that remains untapped. With the resources at our disposal as the Department of Trade and Industry, and in partnership with all spheres of government and a range of institutions, we will be working to ensure that we implement our vision of having a greater geographical spread of investments. These efforts are part of our broader mandate of making our economy more inclusive, attracting higher levels of investment, and becoming more competitive.
I would like to extend my gratitude to provincial MECs and HODs for their co-operation with the DTI and their support of our efforts to grow our economy and address the imbalances of the past.
Finally, I would like to thank the outgoing director-general for the work that he has done for the department. I would also like to congratulate Mr Tshediso Matona, who was appointed acting director–general of the department.
I would like to thank the select committee for their co-operation and for working with us and showing us the right direction and applauding us when we do well. I would like to wish the chairperson of this committee speedy recovery as she lies in hospital after an operation. Hon members, we table Vote 32 before you for endorsement. I thank you. [Applause.]
Mr K SINCLAIR: Hon Chairperson, hon Ministers, as I partake in this debate today, I do so with a very noble, long-term goal of seeing growth, employment and equity being part of the strategy of this very important department. I do so with the realisation that as South Africa we are part of Africa, and that our contribution, to a great extent, will also determine the outcome of Nepad. I do so, hon Minister, with the realisation that there is still a deep division between the first and second economies of this country and that many of the activities of this specific Vote are focused on these specific economies.
However, it is unfortunate that not one of the provincial MECs is attending this very important sitting today. I’m raising this because at the end of the day many of the activities of the department and of other institutions such as Seda, Khula and the IDC are undertaken in the interest of the people through the provinces and local government. Maybe the same argument could apply to Salga.
The third issue that I want to touch on is the very important issue of consumer protection. As part of government’s developmental agenda the Consumer Credit Bill is very important. And I think that it’s high time we finalised this Bill so that many of the atrocities that happen with consumers, especially the poor consumers of this country, are addressed.
I would further recommend that the department, and Cabinet perhaps, look at a holistic approach between the DTI and the Department of Social Services, because if the stories of what is happening at the pension pay-out points in various places and provinces in South Africa are true, it’s really a big cause for concern.
But, a lady once said, and I quote: “Once I had absorbed the ill-treatment that blacks were subjected to, which happened quite early in my life, I thought that you can’t stay in this country unless you do something about it.” That was said by someone who was a member of Parliament for 36 years, by the name of Helen Suzman.
Now, unfortunately, Helen Suzman is no longer the flag-bearer for a party that is supposed to be liberal. And what we heard here this morning, or this afternoon, from the hon member of the DA, when she said that 41% of South Africa is unemployed, can’t be true. It doesn’t matter what country you are in, if you’ve got 41% unemployment there will be a revolution.
I think that we must bury this story of high unemployment in South Africa once and for all. Maybe this re-emphasises the important role that the second economy of this country is playing, and maybe we must further develop the entrepreneurial spirit of our people and make sure that we achieve growth, employment and equity. I thank you. [Applause.]
Mr Q R DYANTYI (Western Cape): Mhlalingaphambili, Mphathiswa Tat’uMpahlwa, Sekela-Mphathiswa Sisi Lindi, amalungu noogxa bam abasuka kumaphondo, ndiyabulisa ngale njikalanga. Ndilapha ndimele umphathiswa uBrown. Mandingxengxeze kuba akakho ngenxa yeemeko ezingaphaya kwamandla akhe, ingekuko ukuba wenze ngabom, Tat’uSinclair.(Translation of isiXhosa paragraph follows.)
[Chairperson, hon Minister Mpahlwa, hon Deputy Minister Lindi, members and compatriots from other provinces, I greet you this afternoon. I am standing here for Minister Brown. I must apologise for her absence. The absence is not deliberate but is due to a huge commitment, hon Sinclair.]
Chairperson, if there is any demonstrable expression of the notion of the first and second economies, it is here in the Western Cape. It manifests itself in various forms and shapes, whether it is ugliness or beauty in the sense that one moment you can be in a very beautiful place, and the next in a place where people are flooded; rich or poor; good health or poor health; those that are employed or unemployed; the housed or the homeless; even those who have to travel long hours to go to work, and those who just walk in and wait for those who wake up at five o’clock in the morning to make them tea. These are the issues.
The province may be very privileged, but if you analyse the situation thoroughly, this is what you find in the context of the Western Cape. I think that we all know that our transformation programme indeed lags behind by many years. At the receiving end of this are the black people in general, and Africans in particular.
We are convinced that bringing these marginalised communities into the mainstream of the economy is not going to happen through a trickle-down approach. A decisive state-intervention approach will have to be the order of the day.
Our vision of a home for all in the province will only be realised through the creation of a single integrated economy that ensures shared growth. In the Western Cape, if you speak about a cake that must be shared, the concern is always that you must first grow this cake. However, this cake is not fairly distributed. If this cake could be fairly distributed and you grow it, we might not necessarily be sitting with some of the charges and problems that we are sitting with.
So, the notion of us always pushing for growth in the economy, when in actual fact you have a small percentage of people controlling the larger portion of it, is just not acceptable, in our view.
To continue growing the economy of the province, we aim to first grow the number of enterprises and make existing ones much stronger. We also want to strengthen the promising sectors and ensure that economic development takes place in all municipalities across the province.
We do, of course, have a number of initiatives that we’d like to share with the House. We are currently in the process of rolling out what we call “real enterprise development” in the province, which, in short, is called the “red door”. This is aimed at ensuring economic participation by the most marginalised through the red door, and we assist in aspects such as basic business skills, business opportunities, mentoring and support, and hands-on private sector expertise.
In that kind of facility it is therefore possible that somebody can be helped in a number of ways, so that we even move away from this practice that somebody who wants help with a business plan must pay for that help. With regard to the red door, you are helped with all those issues under the same roof.
The success story so far on this is the two red doors in Khayelitsha and Mitchell’s Plain, which are presidential nodes in our province. In Khayelitsha alone, within the first four months over 3 000 people utilised that facility. And in the process tenders to the value of R8,2 million were processed. It is a small start, but it is a start.
Linked with that, we’ve got what we call “red finance”. We know that by far the biggest barrier to entry into business by potential entrepreneurs is access to finance. We believe that we cannot present credible assistance to business unless this is tackled head on.
As a province we have, therefore, undertaken to raise R50 million a year to provide assistance to black businesses that find themselves outside of the criteria set by banks. And this is outside of public finance. We are getting into issues of creating partnerships with the private sector and so on. In a month’s time we will be launching our comprehensive micro economic development strategy. Through this we hope to emphasise the importance of fundamental pillars in all sectors, as opposed to add-ons. To those who argue, even within these walls, that we must shrink the role of the state, we are saying that we must actually expand it to ensure economic participation.
This is also in line with our provincial growth and development summit that was convened in 2003, and with annual assessments that are being done.
The other initiative is what we call the Plaaslike Ekonomiese Plan, die Plek [Local Economic Plan, the Plek.] There is inadequate capacity to undertake economic development, planning and implementation in most municipalities outside your metros. We have developed a plan to fast-track the development of high-quality economic development capacity in all municipalities outside the metro through this kind of plan.
This week we will be launching many red doors in all districts of the province. But this is going to be very important to us, because we are also dispatching fully trained and equipped staff from the province to municipalities, which, I think, is in line with what the Ministers also raised here as an important issue.
But a further challenge that we face as a province, which I was asked to mention here, is that we are also willing to share the little knowledge that we have with other provinces. There has got to be interprovincial sharing of knowledge, whether in kind or in whatever way.
Even beyond that, we are already in partnership, for example, with the national government on a number of issues. We are also beginning to play a role towards a better Africa. Just Friday we had a launch of what we call Operation Timbuktu, which was attended by our President.
We are also making interventions in sectors that are in distress. Amongst these, one would like to mention the clothing and textile sector, which is our biggest challenge. But we are quite convinced that we are going to intensify our role in that regard.
One would also like to mention here the call-centre industry. We are anticipating about 20 000 local jobs to be secured in this rapidly growing industry in the province over the next five years. For example, big UK and Dutch investors are convinced and want to play that role in our own province.
Then there is the film industry. The provincial and city governments have given R60 million to developers of a R500 million film studio complex along the N2 near Khayelitsha. Even without it, we have been able to produce a winner such as uCarmen eKhayelitsha. How much more so when we have that kind of infrastructure and support? We will then produce more of those.
The existing film industry support services are almost exclusively white- owned in our own province. The opportunities for BEE are ripe for the picking, and we are going to make them available.
I would like, therefore, to thank you for this opportunity to come here and share with you some of our own ideas and thinking about the province and what it is that we would like to do and share with other provinces. Enkosi. [Thank you.] [Applause.]
Dr F J VAN HEERDEN: Chairperson, I shall address the House in English, as it is indicated on the speakers’ list, but I inform the House that my next two contributions, which will be tomorrow and the day after tomorrow, will be in Afrikaans, just to enable the interpreters to be ready.
As far as the FF Plus is concerned, we took notice of what the hon Minister and the hon Deputy Minister said regarding reducing poverty and unemployment. We must really commend them for that. The Deputy Minister said something that I am really excited about, and that is that the underdeveloped regions must be made more attractive. That would solve a lot of additional problems, such as housing for instance. And I think if the department pays more attention, financially as well, to developing so- called undeveloped regions, that will be a great step forward. In order to enable the country to become competitive on the continent, to become the leader in Africa, as well as to speak with confidence in the company of other great nations, we need to develop.
Judging from some of the reports – I have here one report on the strategic industrial projects of the department - this is something that excites me. If you look at this, in the Eastern Cape, more than 41 000 jobs were created, and more than 13 000 in the Free State. The amounts of money invested in these different provinces, six out of the nine provinces, is really something that one must approve of. I had one opportunity to approach the Department of Trade and Industry with a particular project, and I found an open door at the department. They assisted with advice, without compromising themselves; they assisted with support, without compromising themselves, and that really is something that one cannot but approve of and support entirely.
The FF Plus will definitely support the Minister and the Deputy Minister in their efforts, and we will also of course support the budget. Thank you. [Applause.]
Nkul M J SIBIYA: Mutshami wa Xitulu, Manana Oliphant, Holobye wa Ndzawulo ya Trade and Industry, mutsundzuxi wa Holobye, vatirhela-mfumo va ndzawulo, swirho swa NCOP, in this country, comrades, ladies and gentlemen.[Chairperson, Mrs Oliphant, the Minister of Trade and Industry, the Minister’s adviser, officials of the department, members of the NCOP, in this country, comrades, ladies and gentlemen.]
Before I start, I would like to remind myself of one of the statements, which the president of our country who has left us, the late president Oliver Tambo, made in 1967 at the conclusion of the media briefing he held in Lusaka in Zambia on the operations we called the Wonke campaigns. At the end of that briefing he said, and I quote:
Ours is a just cause and our best weapon is truth.
I am convinced that since the ANC came to power in this country, that truth has been told all along; and even today, this morning, that truth has been told. I am going to add to it when I talk about what is here. [Laughter.]
The victory of the ANC in 1994 in a non-racial election ushered in a new era for the country. It signalled the end of minority rule, and racism as an official policy and ideology in our country. South Africa, which was a pariah state before 1994, then became a democratic state and a welcoming home to all who live in it. Under such circumstances, the new South Africa was readmitted to the United Nations and she joined the then Organisation of African Unity, SADC and the Non-Aligned Movement, to name a few.
The ANC-led government’s broader economic policy goals and the economic programme of action are aimed at eliminating the legacy of apartheid at home and the advancement of mutually beneficial economic co-operation abroad, thereby contributing meaningfully to the actualisation of “a better life for all”, which is a highly concentrated expression of the new South African government’s philosophy of life.
The first five years of our democracy saw our government putting in place laws, Acts, policies, systems and institutions to redress the inherited colonial legacy. Furthermore, it is now known that reasonable politicians and economists alike - and I am one such politician - at least in South Africa, agree that 1999 to 2004 was a consolidation period for our country. Why do they say so? I will come with the answer to that.
It was in this period that South Africa managed, firstly, to set up at least 15 trade missions abroad; secondly, to increase exports to the R3,5 billion level; and thirdly, as part of SACU, to conclude a trade agreement with Mercusor and, on her own, to conclude agreements with Turkey and Croatia. Perhaps, ladies and gentlemen, you remember this very well, provided you were not asleep. As we dealt with our parks yesterday, the news bulletin at six included an item that said that South Africa, together with her partners in SACU, signed an economic agreement with Medicor countries involving 1000 items in a free preferential trade platform. This I find very important, and we need to say a very big thank you to the Minister and Deputy Minister of Trade and Industry. [Applause.]
This is one of the things that we always need to keep in mind, and it is on the basis of this that we say that truth has always been told, is being told and will always continue to be told as long as the ANC is in power in this country.
South Africa’s acceptance in the international community has opened many avenues for our airlines, which enabled these airlines to forge air links with many countries in Africa and outside. Our companies as well, both public and private, are increasing their investment in the African continent, thus helping our neighbours to create job opportunities and to develop their economies.
These and other endeavours of our government, such as mediation by our President in the DRC and Ivory Coast, and by our Deputy President in Rwanda and Burundi on behalf of the AU, have become a focal point of the role South Africa is playing in promoting peace and friendship on the African continent, in accordance with the last clause of our Freedom Charter, which says, “There shall be Peace and Friendship!”
Our country, as a strategic partner, is playing a pivotal role in Africa’s economic development through the African Development Strategy, in terms of which the following steps are being taken: Firstly, the finalisation of the intra-African trade strategy; secondly, the mid-term review of the SADC trade protocol; thirdly, continued trade negotiations with Kenya, Egypt and Nigeria, as well as five bilateral investment protection and economic agreements; and the continuation of participation in Nepad processes, including processes in respect of the African Peer Review Mechanism.
I believe it is in recognition of this pivotal role played by our country that the AU requested us to provide a seat for the Pan-African Parliament, which is currently being held at Gallagher Estate.
On the other hand, in pursuit of trade and investment links with key economies globally and to promote economic development the world over, our democratic government, led by the ANC, through the Department of Trade and Industry, is negotiating preferential trade agreements, supporting a strong and equitable multilateral trading system, fostering economic integration with the continent within the Nepad framework, and administering the facilitation of international trade. In order to realise the above, and to increase the market access opportunities available to South African industries, as well as the export of goods and services, the government has employed the following strategies: Firstly, the completion of the tariff simplification exercise; secondly, implementing the national export strategy; thirdly, managing the permanent trade forum; fourthly, participating in preparations for the World Trade Organisation ministerial meeting in Singapore; fifthly, continuing bilateral trade negotiations with the US and European Free Trade Association; sixthly, sending trade missions to India and China; seventhly, seeing to it that we increase our trade missions abroad to 22; and lastly, completing a World Bank study on trade administration and facilitation.
Before I conclude, let me also remind myself of one of the things said by the then President of Mozambique in 1976, when that country was marking the second anniversary of its independence. He was addressing officials of both the government and the party that was in power there, Frelimo. I am interested in the end part of it, because it sums up all that was said before. President Samora Machel of Mozambique said to them, and I quote:
If you refuse to learn, your mind will remain stupid and your age will
sell you out!
For all this to succeed, implementation is crucial, and that can only happen if resources, human material and finances are at hand. Indeed, our country in general and our government in particular are committed to the eradication of the apartheid legacy at home and to contributing meaningfully to the creation of a better world. That is why the ANC supports Budget Vote 32 unreservedly and urges the House to do the same so as to take forward the good work being done by our government, led by the ANC. I thank you. [Applause.]
The MINISTER OF TRADE AND INDUSTRY: Thank you very much, Chair, and thanks to all the members for their contributions to this debate. Some very specific issues have been raised that relate to the department. One of those is the issue of competition and competition policy, and the role that it can play in helping us achieve some of the objectives we have set for ourselves.
This is a matter that we have identified as one of the issues that we are going to give some attention to this year, because we are still of the view that South Africa still doesn’t have a sufficiently competitive environment which is supportive of the growth, for example, of small and medium enterprises.
Of course, we have also identified other issues, one of which is import- parity pricing, which is the practice in pricing that denies South African consumers of some of the things that we produce from benefiting from the low cost of production of those particular goods. Steel is one such example. And that is why the President, in his state of the nation address, mentioned that this year we were going to try to deal with import-parity pricing as it related to steel and the chemical industry. This is because, with our producing steel, there are many other possibilities for smaller- scale manufacturing operations that can take place that will create jobs that will help beneficiate steel in South Africa.
So, there are those two issues in terms of trying to create an environment which is more friendly to the growth of small and medium enterprises and so on. With regard to the issue of competition, we are going to look at competition policy and competition law in terms of whether there is anything we need to do in order to try to strengthen the ability to attain a more competitive environment.
The other specific issue that was also raised was the issue of the registration of companies – the turnaround time in registering companies. This is something, again, which has enjoyed some attention in terms of some of the changes that have been made institutionally in order to establish Cipro – the Companies and Intellectual Property Registration Office - as an autonomous agency that falls within the broad stable of the Department of Trade and Industry. It would then function much more efficiently; it would be self-funding. So, we are working towards that objective.
More recently, we have had to take some measures to try to deal with some difficulties that arose there, but there is a process in place. We interviewed – I think, on Monday – people that have applied for the position of CEO, because the CEO left a few months ago. We have had an acting CEO. So, yes, we will continue to focus on this issue of trying to speed up the turnaround time.
Of course, some of the issues that have been raised in other forums have to do with whether we should create some presence in provinces for this kind of function. I am just saying that we are working towards improving the functioning of Cipro.
The Consumer Credit Bill was another specific issue that was raised. Indeed, we have finalised the process. The Bill is actually with the state law advisers at the moment. The intention is that it be introduced in Parliament in May. So, from our side, we have concluded the work. It is just the state law advisers who are doing the necessary checking.
Regarding the issue of investment, the rising trend that we are seeing is largely private-sector investment. Part of the drive going forward is going to be to increase the contribution of our parastatals to overall investment in the economy. So that is why you hear the Minister of Public Enterprises laying out plans, outlining plans, and committing resources. That is why you see that there is quite a lot of work that is being done on almost all the ports in the country to reinvest, to expand, and so on, and also in terms of some of the rail links that would help. So we are going to be seeing a lot of investment by parastatals, which gives us the hope and the possibility actually to attain the target of 25% investment as a percentage of GDP, and perhaps much sooner than 2014.
We do have these difficulties that the hon Terblanche referred to.
An HON MEMBER: [Inaudible.] That doesn’t work. [Laughter.]
The MINISTER OF TRADE AND INDUSTRY: We listen to her because in certain respects we do have difficulties in clothing and textiles. We do have difficulties with the tea industry. As the Department of Trade and Industry, we are not unconcerned about the difficulties experienced in these areas. We are simply of the view that we cannot only look at the remedies we should or can take as government. Sure, there may be a case for remedies in certain respects. For instance, if we have the problem of illegal or unfair imports, there may be a case for looking at some remedies we can take, but we need to look beyond that.
One of the things we have been grappling with is the issue of the instrument that was provided to the clothing and textile sector to assist that sector to adjust to the competitive pressures that are there. Now, this instrument, in the course of time, fell into some abuse, and that abuse is resulting in some of the further pressures that the industry is facing, because it is leading to higher imports of cheap clothes from China. So we have to look at how we tighten that, but also go beyond that. We must also look at coming up with a comprehensive strategy that enables us to make those sectors competitive. Of course we have to accept that nobody has escaped the power of China in the clothing and textile sector. We have to ask ourselves some hard questions as well. Can we be competitive in the clothing and textile sector?
However, other regions or other areas are responding differently to this issue. If you go to North Africa you will find that they are facing the same pressures, but they are responding as a region - North Africa as well as the south of Europe. And, in certain instances, we have to look at whether we can make ourselves part of the global supply chain. So, we really have to take a much broader approach and not just look at remedies only.
Regarding tea, we are currently processing a report of a forum that we established a few months ago to get a process going that includes all the stakeholders in the tea industry – the growers, the packers, the respective provinces, the Department of Agriculture, and so on. We are processing that report. There are a whole host of possible things we can do. One of these is whether we impose tariffs against tea that comes from the SADC region. Obviously, we can’t do that, because we have a SADC trade protocol. Also, we can’t act against LDCs within our region, such as Zambia, Malawi, and so on. This also raises the possibility of whether we should impose tariffs on tea that is coming from outside the SADC region. This also includes whether we can come to some agreement with the packers in terms of the price that they pay for the tea that they buy in South Africa. There is a whole range of proposals, and we are applying our minds at the moment to those proposals. I’m hoping that we will be able to make some announcements in this particular regard.
To the extent that you have raised the issue of the Enterprise Organisation and enterprise development that is seated in it let me say to you that we are actually grappling with this issue of whether we have everything sitting in the right place in the department. We accept that the transformation and restructuring process – and I said so in the media yesterday – has broadly given us a department that is properly structured to do its work in the modern, open, integrated economy that we have.
But, within that broadly correct structure, which we don’t need to tamper with, we may need to perhaps look at certain things within the department, in other words to ensure greater alignment within the department of the respective functions. So that is something that we are grappling with.
You’ve raised the issue of labour markets, and quite clearly this is a matter on which we would find difficulty agreeing. We have had discussions with labour and the presidential working group, because they had concerns about us talking about looking at whether you could ease up some of the labour regulations for small businesses. We explained to them that we were looking across the board at all possible things – in the tax area, in the labour law area and in other areas that may be constraints to small businesses. Clearly, we had to give the assurance that we are not about to take away the rights of workers. Our history and our reality in South Africa do not easily lend us towards diminishing the rights of people.
Let me then come to the issues that, I think, have been raised by a number of people around second-economy interventions. With regard second-economy interventions, certainly this is a very big part of our focus. This is going to take up a lot of our energy and, I think, in time a lot of our resources, because we will not be able to unlock that potential in those marginal areas and amongst those marginalised people if we don’t make resources available that help us to achieve that objective. So we are doing a lot of things.
What is perhaps important at this point in time is that there is at least a sense and an emergence, perhaps, of a package of things we are doing that will help us to unlock potential in the second economy – whether we are looking at microcredit, the Apex Fund, the co-operative’s policy and law, initiatives we are taking to support the growth of co-operatives, the Small Enterprise Development Agency or the review of the impact of regulations on small businesses. This is a whole package of things. And, in terms of those instruments as we go forward, we are going to be focusing now on ensuring that we implement. We want to see Seda roll out presents across a whole number of provinces and localities, because the critical thing is to create access points – integrated access points – to which people can go to get assistance in a whole number of ways.
We, of course, do take note, hon Dyantyi, that certain provinces have taken initiatives. We don’t have difficulties with those initiatives. We just have to see whether we can partner in this regard, because it is a big responsibility. I think we need to have a co-ordinated approach and a shared approach in trying to deal with this issue.
We also have new initiatives: the Co-operative Banks Bill, the Dedicated Banks Bill. We have the micro-agriculture finance scheme of the Department of Agriculture. There is a whole package of things that we are going to be implementing to try to help us intervene effectively to unlock potential in the second economy. These are the things that will help us to make sure that the growth we are achieving, and which we raise to higher levels, is shared growth that brings in people.
We went to India with the Minister of Agriculture. We were invited by one of the CEOs of the big companies there that is involved in second-economy interventions in India, and specifically in the area of microfinance provision for the really poor people of India. The way that they get involved is to make sure that they help to make the cost of microfinance cheaper for the poor people by subsidising the costs. This is a private- sector company, not a government body. It subsidises the costs of the NGOs and organisations that provide this finance to poor people. That is a very creative way for the private sector to be involved in these kinds of interventions.
I’ve been saying that perhaps in our own drive we need to see if we can get both the public and the private sector involved in similar ways. Perhaps we can incentivise the private sector, for example, by accommodating things like that as points that companies can earn in terms of the codes of good practice in terms of BEE. This is to ensure that we can achieve this shared growth, which brings in people, which involves people.
A lot of the work we are going to be doing this year is developing strategies for specific sectors. Those sectors, of course, are the film sector and the process of business outsourcing. We have so much potential just in those two areas. We have a number of advantages. Quite clearly, in terms of the film industry, South Africa is a location, and we can also develop this capability of South Africa to produce high-quality films.
Now, you’ve seen quite a number of these films – Drum by Zola Maseko, U- Carmen eKhayelitsha, Yesterday. This is what I said when we launched the film incentive in Johannesburg with the Deputy Minister. We said to them that their challenge as film producers was to find those unique stories that South Africa can tell the world. This is because we think that we do have unique films that we can give to the world.
So, we have introduced this film incentive. I must say that from quite early on the interest was huge, possibly even oversubscribed. We have to look at how we further support. We are going to be doing a lot of work to develop strategies for sectors that we see as having a lot of potential to provide jobs, generate exports and contribute to our growth.
By the way, I would like to encourage members who have not seen U-Carmen eKhayelitsha to actually go to see that movie. It’s a mind-blowing experience, if I can say so. It’s located firmly in Khayelitsha. There is no attempt to spruce up Khayelitsha. It’s Khayelitsha as it is. The movie was shot there and the people come from that kind of community. I think it is going to make a very big difference, even to our people, in terms of relating to what that movie is all about. So, I would like to encourage people to actually take the time to go to see that movie.
The CHAIRPERSON OF COMMITTEES: [Inaudible.] The MINISTER OF TRADE AND INDUSTRY: Yes, I am rounding up.
On the strategic investment programme that the hon Van Heerden referred to, clearly, in terms of those kinds of instruments that we have at our disposal, one of the things that we have to look at is whether we can focus them better, especially on things like job creation. So, yes, we will continue to focus on those. Trade, the opening of markets, Africa – these are things that provide opportunities for provinces, even for small and medium enterprises.
So, I would like to thank everybody for participating in the debate.
Thank you very much. [Applause.]
Debate concluded.
The Council adjourned at 16:26 ____
ANNOUNCEMENTS TABLINGS AND COMMITTEE REPORTS
ANNOUNCEMENTS:
National Assembly and National Council of Provinces
- Introduction of Bills
(1) The Minister of Housing
Prevention of Illegal Eviction from and Unlawful Occupation of Land Amendment Bill [B 11 – 2005] (National Assembly – sec 75) [Explanatory summary of Bill and prior notice of its introduction published in Government Gazette No 27370 of 18 March 2005.]
Introduction and referral to the Portfolio Committee on Housing of the National Assembly, as well as referral to the Joint Tagging Mechanism (JTM) for classification in terms of Joint Rule 160, on 14 April 2005.
In terms of Joint Rule 154 written views on the classification of the Bill may be submitted to the Joint Tagging Mechanism (JTM) within three parliamentary working days.