TUESDAY, 31 MAY 2005 __

          PROCEEDINGS OF THE NATIONAL COUNCIL OF PROVINCES

                                ____

The Council met at 14:00.

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.

              UNFORTUNATE INCIDENT IN NATIONAL ASSEMBLY

                         (Draft Resolution)

Mnu M A MZIZI: Ngiphakamisa ngaphandle kwesaziso:

Ukuthi lo Mkhandlu-


(1)    uzwakalisa ukudumala ngesenzo esenzeke ngomhlaka-25 kwephezulu
     eNdlini yeSishayamthetho sikaZwelonke;

(2)    uyezwa ukuthi lo mkhuba wenzeke ngasesihlalweni somholi weqembu
     leNkatha Freedom Party lapho kutholakale khona indle yesilwane
     ingcanga phela lena engikhuluma ngayo;

(3)    uyabona ukuthi lokhu kuthunaza isithunzi somholi neseNdlu
     yeSishayamthetho sikaZwelonke;

(4)    uncoma ukuthi isimo esifana nalesi singaphinde senzeke. (Translation of isiXhosa Draft Resolution follows.)

[Mr M A MZIZI: I move without notice:

That the Council-

    1) expresses disappointment about an unfortunate incident that took
       place in the National Assembly on 25 May;


   2) notes that this unfortunate incident happened next to the leader
      of the Inkatha Freedom Party, where dog faeces was discovered;

   3) notes that this degrades the leader’s and the National Assembly’s
      dignity;

  (4)   recommends that something of this nature should not happen
       again.] Motion agreed to in accordance with section 65 of the Constitution.


                    HOSPITALISATION OF MR WATSON


                         (Draft Resolution)

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

That this Council-

1) notes with sadness that one of its hon members, Mr Watson, suffered a
   heart attack on Friday;

(2) also notes that he is now out of hospital but would like to wish him a speedy recovery; and

(3) keeps him, together with his family, in its thoughts and prayers.

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

The CHAIRPERSON OF THE NCOP: I also agree with the motion. I did speak to Mr Watson. I can confirm with the House that I spoke to him yesterday. He is well and good. He is consulting his doctors today and will be joining us soon. We all wish him well and that he will come back and join us again soon in the Chamber.

                         APPROPRIATION BILL


                           (Policy debate)

Vote No 34 – Water Affairs and Forestry:

The CHAIRPERSON OF THE NCOP: Order! Just before I call the Minister, I would like to know if the MEC for agriculture of the Western Cape, Mr Dowry, is here. Is there another MEC here? On my speakers’ list I see one MEC. Do we have another MEC here? Mr Mahlahla – oh, MEC for transport. I’m talking about Water Affairs. You are the only MEC here?

Before the Minister speaks, I just want to say that I am very happy to see some of the MECs taking a keen interest in the Budget Votes being debated in the National Council of Provinces; joining the national Ministers. I think it is very important, when the national Minister presents her or his Budget Vote in the Council, that the provincial MECs take a keen interest in being here as well, because the Council would also like to hear the provincial perspective. So, in short, I want to thank those MECs and the provinces that are really taking a keen interest in being here when the national Ministers are with us to debate these issues. [Applause.]

I must encourage all provinces to do that - I am now talking to the provincial Whips. I’m encouraging you. Please do invite these MECs and make them aware of how important this is. We need them here in this Chamber. I wish to thank those who are here today. Thank you very much for making yourselves available. I’m aware that you have very hectic schedules, but all of us do as politicians, as you all know.

I now call upon the hon Minister to deliver her Budget Vote. [Applause.] Hon Minister, they say there is a small watch there. I haven’t seen it, but I will announce it to everybody once they start debating.

The MINISTER OF WATER AFFAIRS AND FORESTRY: Yes, I see the clock, and it has not started ticking.

The CHAIRPERSON OF THE NCOP: Has it started already?

The MINISTER OF WATER AFFAIRS AND FORESTRY: No, it can’t. Hon Chairperson of the National Council of Provinces, hon members and Premiers present, hon MECs, dignitaries, invited guests; it gives me immense pleasure to have the honour of addressing the National Council of Provinces today.

In my budget speech to the extended committee of the National Assembly I dealt with water resources and forestry issues at length. In this address I will focus particularly on matters of provincial and local government competency, such as water supply and sanitation services, intergovernmental challenges and co-operative governance.

I’d like to begin by recounting the words of the late Chairperson of the National Council of Provinces, Mrs Joyce Kgoali, who said in her speech during the “Taking Parliament to the People” programme on 26 November 2004:

The National Council of Provinces, provinces and municipalities are at the cutting edge of the national programme to build a better life for all. Municipalities, in particular, are at the coalface of service delivery. They are an important front desk of government and should be capacitated in order to assist us in reaching our strategic goal of reconstruction and development.

These words remain as relevant today. The urgency of addressing municipal capacity is a high priority on our agenda. Without institutional capacity we will not achieve our goals. Water is a life and death matter, and this is why we have such ambitious targets for addressing our backlogs and for providing free basic services to the poorest of the poor. We therefore have to work together to achieve these targets.

The NCOP, as the custodian of intergovernmental relations and co-operative governance, has the major task of ensuring that we work effectively together across the different spheres and sectors of government.

We often speak of co-operative governance, but we are less often able effectively to put it into practice. Co-operative governance between the different spheres of government and between large departments is not easy to achieve. It requires commitment; it requires leadership; it requires a strong drive towards common objectives.

Despite the challenges of co-operative governance, our department has achieved some very real successes in the water services sector through co- operative arrangements with the Department of Provincial and Local Government, the National Treasury and the SA Local Government Association.

Together we are working on our transfer programmes in order to place water services schemes in municipalities where they rightfully belong. My department has signed 27 transfer agreements with municipalities; has transferred 78 schemes with a value of approximately R1 675 million with 717 staff members; and has seconded a further 892 personnel to municipalities. We are doing all this to try to ensure that the necessary capacity at that level is available. Despite immense challenges, we still anticipate that we will be able to execute all transfers by the target date of March 2006. Other joint initiatives include support programmes for municipalities in order to identify the most appropriate water-services-provider institutional arrangements. This support takes place through the implementation of the National Institutional Reform Strategy. I hope that members were able to collect a copy as they were coming in. It is quite an important strategy with which I want everybody to be conversant. This is meant to give support to municipalities according to section 78 processes.

Both of these initiatives are driven and guided by task teams comprising the Department of Water Affairs and Forestry, the Department of Provincial and Local Government, the National Treasury and Salga.

A further important initiative, in many ways a pilot for the new budget process that will see departments working together to ensure the alignment of their budgets, was the allocation of R1,2 billion to the Department of Provincial and Local Government’s municipal infrastructure grant for a targeted bucket eradication programme. Through this injection we can proudly say that buckets will be eradicated throughout South Africa in the life of this Parliament.

Whilst these programmes are examples of operationalising co-operative governance, our entire approach to water services delivery is a sector-wide collaborative approach, appropriately named Masibambane: Let’s work together. Linzima ke ela gama. Andilibizanga kakuhle, kodwa ke niyaliqonda kuba ndithetha isintu; isilungu esi siyaphuncuka ngamanye amaxesha. [That word is difficult to pronounce. I did not pronounce it well, but you should know what it means. I speak a vernacular language and the English sometimes escapes me.]

The fundamental principle underlying this successful collaborative approach is that we are working together as a sector to deliver jointly identified and unanimously agreed sector goals and targets. At the national level we are working with various sector departments such as Housing, Provincial and Local Government, Health, Education and Public Works, as well as with representatives from Salga. The NGOs are part of this, including Setas. “Masisebenzisana sisonke”. [Let us all work together.]

In the provinces similar structures have been established to ensure that support is targeted at local government needs. These initiatives illustrate how our department has championed sector collaboration. Asinandlela, siyanyanzeleka ukuba sisebenze nabanye abantu. [We do not have another way; we have to work with other people.]

We now want to embark on a vigorous programme of action to strengthen collaboration, between our Department of Water Affairs and Forestry, regional offices and provincial government, across all our functions. This should be understood in the context of the Intergovernmental Relations Framework Bill, the IGRF Bill.

There are a number of reasons for this. Firstly, water-resource management is not simply a sectoral function that the Department of Water Affairs and Forestry and the Department of Provincial and Local Government need to address. Water is an indispensable national resource, crucial to social and economic development, and is not indispensable just in terms of the provision of domestic water supplies. Water is an essential ingredient in every provincial growth and development strategy. Therefore, we want provinces to come into the arena of engaging more effectively in water- related affairs, especially given that South Africa is a water-scarce country.

Secondly, provincial government is a crucial interface between local government and national government, and it has a key role to play in strengthening the capacity of local government to deliver services, including water and sanitation services. Thirdly, there is no concurrent function for forestry or for water resources in our provincial sphere of government. Otherwise, I would have many MECs if we had a concurrent function. This is an intergovernmental challenge that we need to address. Although we have our Dwaf regional offices, these offices are accountable to the national Department of Water Affairs and Forestry and they, themselves, do not have a provincial mandate.

Various attempts have been made in the past to establish mechanisms to address water and forestry-related matters at a provincial level, such as the establishment of the provincial liaison committees, chaired by the MECs of local government or the MECs of agriculture and nature conservation.

Kuyacaca ukuba yinkedama le, intyontyelwa nangubani na. Ngoko ke kuyafuneka ukuba ulungiswe lo mba. [It is like a lonely child who has been orphaned and everybody feels they could influence it in some way. We need to rectify that.]

However, these initiatives have not always been successful. It is now imperative that we jointly develop a more holistic and co-ordinated approach to our co-operation at provincial level. This collaboration must ensure that provincial growth and development strategies take the relevant catchment-management strategies into account in terms of the available water resources, as well as plans for the development of those resources.

Kaloku xa sizisa uphuhliso kumaphondo, sisakha izindlu sisenza nezinye izinto, ukuba ngaba asazi ukuba angakanani na amanzi akhoyo sisemngciphekweni wokuba sisuke siphelelwe ngamanzi. UMzantsi Afrika lo unengxaki yokuba ungabi namanzi oneleyo. Kanti ke thina sililizwe elisakhulayo ngokubhekisele kuphuhliso, sakha izindlu, sizisa amanzi ebantwini kwaye sakha izindlu zangasese mihla le. Yonke le nto ibandakanya amanzi ngalo lonke ixesha. Kubalulekile ke ukuba amaqhinga asetyenziswa ngamaphondo awujonge loo mba. (Translation of isiXhosa paragraph follows.)

[When we launch development programmes, build houses and provide all the other basic services in the provinces, we should keep constant check on the water resources that we have available as we may run out of water at any time. South Africa suffers from water shortages. We must therefore be careful, because we are a developing country; we are providing housing, sanitation facilities and bringing water to the people every day. All these activities involve the use of water all the time. It is important that when provinces draw up their development programmes, they look carefully at that matter.]

In provinces such as Mpumalanga, KwaZulu-Natal and the Eastern Cape in particular, they must also reflect the specific opportunities and challenges of forestry development and conservation.

Ndiyafuna ukuwugxininisa lo mba ngokubhekisele kumahlathi, kuba la mahlathi eza nemisebenzi kula maphondo. [I want to emphasise this point, especially with regard to forestry because forests provide jobs for people in the various provinces.]

They are the source of employment and they contribute greatly to the rural economies.

Ngoko, bantakwethu abakwezi ndawo, siyanicela ukuba nisondele ukwenzela ukuba siwathathe la mahlathi, siqhekezelane phantsi kwenkqubo yokubonelelwa kwababevinjwe amathuba ngaphambili. Kuya kuthi ukuze kulunge zenzeke ezo zinto, sisondele, ukuze sazi ukuba kwenzeka ntoni na. (Translation of isiXhosa paragraph follows.)

[I would like to appeal to people living in these areas to come closer so that we can reap and share the benefits derived from these forests under the reconstruction and development programme. Those things can only happen if and when we educate ourselves about the things surrounding us.]

The potential already identified and mapped out in KwaZulu-Natal can help to transform the rural economy in many areas. It needs provincial and municipal governments to seize the opportunities presented for the economic development of our most deprived communities as growers and independent contractors.

We are conducting a similar strategic analysis in the Eastern Cape. When we have identified the possibilities for small growers and independent contractors, we shall call upon the Eastern Cape provincial government and the district municipalities concerned to assist their communities in developing their rural economies. In co-operation, our three tiers of government can transform the lives of these people, but …

Mandiphume nje ecaleni nakulo mba, nditsho ukuba enye into ebalulekileyo endingathi masiyijonge kula mahlathi yindlela abasebenzi abaphatheke gadalala ngayo.

Singavuya ke ukuba ningamana nisiphathela iindaba ukwenzela ukuba sibe nokuthabatha amanyathelo, kuba siza kuwathabatha ngoba ukuphatheka gadalala kwabasebenzi lulwaphulo-mthetho walo rhulumente ukhokelwa nguKhungolozi. Ngoko ke ayinyamezeleki loo nto. Siyafuna ke ukuba nibe ngooqalazive, nisizisele iindaba ngobunjalo bazo ukuze size kujamelana nawo lo mkhuba.

Ndithetha nje likhona iphulo eliza kuba kho phakathi kwam noMnumzana uMdladlana, onguMphathiswa wezaBasebenzi. Siza kuphuma siye kukhangela ukuba kwenzeka ntoni na ukuze ke siyilungise imicimbi enje ngokuphatheka gadalala kwabantu. Ungafumana ivenana encinci ikhwelise abantu abangama- 200, ithi yakuwa kufe abantu abantu abali-150, kuba kaloku bekukhweliswe abantu abangakhathalelekanga. Zisenzeka nanamhlanje ezo zinto, kwaye sinoxanduva lokuba sizilungise. (Translation of isiXhosa paragraphs follows.)

[I would also just like to say that one other important thing that we need to investigate is the bad treatment that some workers who participate in these projects of deforestation suffer under certain people.

We would appreciate it if you could report such incidents of ill-treatment so that we could take the necessary steps, and take them we will, because ill-treatment of workers is against the law under this government. We would appreciate it if you could report this to us as it would enable us to deal in the most appropriate manner with those who practise this bad habit.

Hon Mdladlana, who is the Minister of Labour, and I are planning to launch a campaign. It will include our going around and investigating cases such as the ill-treatment of workers. It is common to find a small van carrying 200 people, and when an accident occurs and it turns over, 150 passengers are killed because the passengers were considered less important. Such things still happen today and it is our responsibility to change them.]

This, of course, is also part … lo mba wamahlathi … [… of this matter about forestry …] of the broad-based Black Economic Empowerment process which we launched on 1 April. That process is under way.

Ngokubhekisele kwezi nkqubo zokuxhotyiswa kwababevinjwe amathuba ngaphambili, masizame ukuba kufumane abona bantu bahlelelekileyo ukuze eli khwelo lethu lokulwa nendlala libe leliphumelelayo. [We should redouble our efforts to ensure that the people who were previously disadvantaged benefit the most from our endeavours to empower them and develop their skills.]

In terms of the Intergovernmental Relations Framework Bill “…ngulaa Mthetho usayilwayo ebendibhude igama lawo ekuqaleni …” [ … it is the Bill whose title I mispronounced at the beginning…] …my department is strengthening its own structures of intergovernmental relations, and is also participating in the structures of intergovernmental relations at provincial level, such as the Premiers, co-ordination forums and mayoral forums. We are also initiating joint Minmecs with other national departments, such as Provincial and Local Government, Housing and Agriculture, because there is a lot of overlapping between these departments and ourselves.

Sinemali yokubonelela amafama asakhasayo, esinokuthi xa siwabonelele ngayo aseke amaphulo onkcenkcesho, akwazi ukufumana into kumhlaba anawo. Ke sifuna ukuba abantu beze ngaphambili ukwenzela ukuba imali ingamane ibuyiselwa umva ingawenzanga umsebenzi wayo, ube umsebenzi wona ukhona, nabantu beyidinga imali. (Translation of isiXhosa paragraph follows.)

[We have funding available for emerging farmers to establish irrigation schemes to enable them to produce on their land. We are calling on people to come forward so that we must not have a roll-over of money that was set aside for a certain purpose, and which people urgently need.]

I have also initiated a series of water summits in the different provinces at which we will engage with provincial government and other stakeholders around their provincial growth and development plans. The first of these summits was held in Limpopo in February, and the second was held in the Western Cape in March. We hope to have covered all nine provinces by March next year. These summits are intended to facilitate the sharing of information and concerns in order to come up with collective and integrated interventions.

Siyaphawula ke ukuba imicimbi yamanzi le asinto ixhaphake kakhulu ukuba siyazi. Kanti ke ndidla ngokutsho kuMnu Trevor Manuel ukuba mhla ndaya kuvala itepu, wonke umntu uya kuze abaleke eze kum xa kungekho manzi apha eMzantsi. Kufanele ukuba sizikhathaze ke, siyazi into eyimpilo yethu. Kwezi ngqungquthela ke siza kuncedisana sabelane ngolwazi. (Translation of isiXhosa paragraph follows.)

[We might notice that water affairs is not an issue that is commonly familiar with. I sometimes tell hon Trevor Manuel that if he should decide to shut off the water, people would come running to me for everybody will be affected, and in every respect. We, therefore, should be curious and take note of what gives us life. At these conferences we will assist one another and share information.]

In particular, these summits will provide us with an opportunity to explain our water-resource management work and that of structures such as catchment- management agencies and water-user associations.

Ndiyafuna ukuba nezi zinto siziqwalasele ngoba senza uhlengahlengiso. Xa sithetha nge-Catchment Management Agency umntu endinguye uza koyika ukuza ngaphambili, kanti yile ndawo kanye ekufuneka kufele kuyo ithole, le kufuneka siye kuyo. Luhlengahlengiso ke olo. Ngoko kufuneka sazi ukuba kuqhubeka ntoni na. (Translation of isiXhosa paragraph follows.)

[I would like it if these other things could be carefully and thoroughly understood because we are presently restructuring the department. People like me will feel threatened when the Catchment Management Agency is mentioned, while it is exactly the place where people need to go to familiarise themselves with issues. That is restructuring. We must know what is happening.] In addition to our immediate support for Project Consolidate, my department is developing a long-term water services sector-support strategy. As this is a sector strategy, we will be eliciting the views and inputs of all stakeholders in the sector, in particular municipalities, Salga, sector departments and provinces. A key objective of the support strategy is to ensure that we are better equipped to support local government in delivering its water services obligations.

A strong and effective local government is fundamental for improved water service delivery. Over the past few years our department has implemented a range of institutional support programmes for local government, with the goal of ensuring sustainable water services institutions.

These programmes are outcomes-based and are designed to assist with planning, setting tariffs, putting bylaws in place, identifying and implementing capital projects and establishing effective institutional arrangements for service provision. The lessons learnt through these programmes are being documented and shared through the Water Information Network.

We are also implementing a system to assess water services authority capacity in order quickly to identify legislative compliance and capacity gaps in line with the Project Consolidate approach. From our assessments we will be able to report on the water services capacity and performance of all municipalities, and to provide a provincial perspective.

In his speech on the occasion of the Budget Vote in the National Assembly, Minister Mufamadi called on officials of national and provincial service delivery departments to spend a significant amount of their time dirtying their hands in the goals of helping to remove service delivery blockages and bridging the gap between intentions and outcomes. Our supply target is universal access to a basic water supply by 2008.

Sifuna ukuba wonke umntu abe uvula ze afumane amanzi acocekileyo etepini, hayi amanzi anezabonkolo. [We want everybody when they open their water taps, to get clean, drinkable water, not water that is filled with tadpoles.]

This means that within the next three years we must put in place infrastructure for basic water services for the 3,6 million people who currently have no access to safe water and we must improve supplies for the 5,4 million people who are still more than 200 metres from a source of safe water.

To reach our sanitation target by 2010, we will have to provide approximately 16 million people with access to a basic level of sanitation in five years. Most of these people are in rural areas, informal settlements and on commercial farms. If we are going to meet these targets we will need excellent planning in each municipality – through their water services development plans and IDPs; and excellent implementation plans to turn our municipal infrastructure grant funds into effective services. We are supporting municipal planning to ensure that MIG projects are identified and prioritised, and that they move quickly through the implementation process. Through our support programmes we aim to identify specific capacity gaps so that these can be effectively addressed.

Collaboration needs to be operationalised into tasks, outcomes, report- backs and deadlines. Collaboration in terms of water services needs to result in concrete action on the ground, so that no person is without access to a basic water supply and so that no person is left without an adequate sanitation facility. Collaboration also requires a high level of direction and accountability. This Chamber has a responsibility to ensure that the intergovernmental relations system is effective in meeting our country’s developmental needs, and this means achieving our targets on time.

Meanwhile, my department will continue to develop its policy regulatory and information role in our water services. I have spoken at length about our supportive role, but, in the longer term, our regulatory role is equally important to protect consumers and public interests in order to ensure that we do not just provide infrastructure on the ground, but working services that meet people’s needs. A detailed regulatory strategy for water services will be unveiled before the end of the year.

I would like to close by emphasising that improved water-resource management, forestry development and improved water supply and sanitation have the potential to contribute hugely to both poverty eradication and economic growth and development. Improved collaboration between my department and the provinces and local government will help us to ensure that this potential is realised. It will help to ensure that provincial and local priorities are addressed and that equitable economic growth and development is achieved.

Our forests must remain resources for the lives of our people. Sound water- resource management underpins all our development goals. Water is life; sanitation is dignity. I thank you. [Applause.]

The CHAIRPERSON OF THE NCOP: Thank you, hon Minister. I now call upon the hon P Moatshe, Chairperson of the Select Committee on Land and Environmental Affairs. There is a clock there.

Rev P MOATSHE: Chairperson, hon Minister, MECs, special delegates, hon members and comrades, departmental officials and people in the gallery, the ANC stands to support the budget. Water, sanitation and hygiene are essential for achieving all Millennium Development Goals, and hence contributing to poverty eradication globally. Our national water and sanitation programme, which is one of the largest in Africa, aims to fulfil the human right to water and to achieve full sanitation and water supply coverage well in advance of the Millennium Development Goals.

The ANC-led government has laid down a clear policy and legislative framework; an implementation programme which has provided water infrastructure for over 10 million people in just 10 years; a policy of free basic water which aims to ensure that affordability is not a barrier to access to safe water; and the devolution of responsibility from national to local government.

The whole concept of the national water and sanitation programme derived from the ANC’s policies and has been based on the promise of a better life for all our people.

The national rural water supply and sanitation programme thus became not just a short-term activity of the Department of Water Affairs and Forestry, but an integral element of the whole nation’s legislated human rights programme. We believe that the programme is on course to achieve full coverage of water supply and sanitation by 2010, well in advance of the Millennium Development Goals. The main point of concern in moving forward is the capacity of local government to implement the work and financial sustainability of the free basic water policy.

The national programme has constructed water supply schemes designed to serve over 10 million people in just 10 years. This has helped to redress the social inequality of the past. We can now talk about equal access to water for all. The majority of poor South Africans suffered from water- related diseases, and besides losing their lives, they also lost their dignity as a result of the poor sanitation facilities.

Job creation is an overstated benefit of the national water and sanitation programme, and the Department of Water Affairs and Forestry monitors the number of jobs created by it. The Working for Water Programme was launched in 1995 and has become of government’s key poverty relief initiatives. This programme has created jobs and trained some 20 000 previously disadvantaged and unemployed people of our country.

This government has put in measures to ensure that the process of service delivery is not hindered, through a number pieces of legislation and policies, for example, the National Water Act, Water Services Act, Free Basic Water Policy and the Strategic Framework for Water Services, which was previously known as the White Paper on Water Services, give a strategic framework for the water services sector as a whole. It addresses issues of inequality, provisions of basic services, the provision of higher levels of service and the sustainable provisions of service. Through the Municipal Infrastructure Grant, the department hopes to eradicate the backlogs of water supply for the remaining 5 million rural people who have no access to formal infrastructure.

In fighting poverty and creating work, forestry also plays an important role in the country’s second economy, with the majority of South Africa’s rural poor making extensive use of forestry products for daily consumption and small-scale trade. Firewood, building poles, medicinal plants and edible fruits are all critical to the livelihood of the rural poor.

In April this year different stakeholders gathered to discuss forestry issues, but specifically broad-based Black Economic Empowerment, BEE, which later resulted in a proposal for a charter for the forestry sector. It is essential for the sector to contribute to overcoming deep rural poverty and economic inequality in our land.

Ownership of commercial plantations by previously disadvantaged groups is estimated at less than 5%, based on small grower schemes and the Black Economic Empowerment percentage in privatised Category A plantation packages. The growth in the small grower industry, supported by major forestry companies, is encouraging and appreciated but much more will need to be done to ensure equitable ownership patterns. This will not happen solely through the small grower sector.

There are still concerns regarding the after-transfer complications like employee packages, which have delayed transfers in other instances. Although the ANC supports the process, however, it should not be at the expense of the poor, struggling workers.

The Committee on Water Affairs and Forestry will be busy amending the Forestry Act this year. The Bill will amend a number of related pieces of legislations to bring them in line with current developments. It will amend legislation such as the National Forestry Act, the National Field and Forestry Fire Act and the Wattle Bark Industry Act of 1960.

There is a growing recognition that the forestry industry occupies an important role in terms of the economic, social and environmental requirements of the country. However, it is imperative within the context of a developing country that the forestry industry as a whole has a well- defined, longer-term vision and strategy that will involve all stakeholders. Forestry, being primarily a rural industry, can make a significant contribution to the development of rural people.

It is extremely important on the score of sanitation that our people’s dignity will be restored if sanitation is made a priority. At the level of sanitation, you have different categories. You have people who go into the veld to help themselves. Then you have people who are using the bucket system. I think these two levels have to be given priority, hon Minister, so that at the end of the day their dignity is able to be restored.

You have those who have toilets to flush, who are much more privileged and have the privilege and the respect they deserve. Therefore, sanitation has to receive more in our budget so that we really restore the dignity of our people in the most rural areas, so that they can also realise a better life for their future. I thank you, Chairperson. [Applause.]

The CHAIRPERSON OF NCOP: There is a little clock there, hon Mack. Look at it.

Mr N MACK: Chairperson, hon Minister, hon members and comrades, MECs - and especially the MEC from the Western Cape - departmental officials, ladies and gentlemen, the ANC congratulates the Minister of Water Affairs and Forestry on a recent announcement that the department provided water to the 10th millionth person in December last year. Let us proudly stand here and note that this historical event takes place on the eve of South Africans celebrating the 50th anniversary of that blueprint document, the Freedom Charter.

This significant announcement by the Minister is in tendum with President Thabo Mbeki’s important assessment that our country as a united nation has never in its entire history enjoyed such a confluence of encouraging possibilities. The Freedom Charter reminds us that there is so much that binds all progressive people in South Africa who share a common view on the need for social and economic transformation.

Communities from the first and the second economies have to rally together with a common vision to revive South Africa, through water and sanitation projects or forestry projects in rural areas. The Minister said that in South Africa water is key to winning the battle against poverty, and its scarcity could be a limiting factor to growth. No meaningful socio-economic development can take place without water.

Being one of the 30 driest countries on earth, South Africans have a responsibility to conserve this precious resource. During the water week the Minister said: “A person can survive for three weeks without food, but only for three days without water”.

It is therefore our duty to make sure that this scarce resource is protected, conserved, managed and controlled. Government has come up with different strategies to conserve water, for example, the National Water Week and the National Water Conservation and Water Demand Management Strategy, which aims to challenge users in the agricultural, industrial, mining and residential sectors to conserve and reduce their demand for water.

The ANC government introduced the rural development framework, thus providing a framework within which government, working with rural people, aimed to address rural poverty and support the developmental efforts of rural people.

The framework identifies the key issues in rural development as investment in basic infrastructure and social services, that is the building of rural infrastructure with the focus on the provision of water and sanitation. Together with the government CBOs have a significant role to play in rural water services provision, and can improve the level of service in a cost- effective way.

In 1994 the Department of Water Affairs and Forestry initiated a Community Water Supply and Sanitation Programme to ensure that all South Africans have access to sufficient water and a healthy living environment with the focus on rural areas. Neglect, nondelivery of service and the sharing of drinking water with livestock are things of the past for rural communities, as government is speeding up water supply projects to communities around the country.

Black farmers never had any hope of ever succeeding due to too many restrictions of the previous apartheid government. Today we stand here to celebrate freedom of economic activity as government continues to introduce safety nets for the previously disadvantaged rural communities.

The Department of Water Affairs and Forestry, in partnership with the Department of Agriculture, has developed a strategy to create opportunities for poor farmers through irrigation schemes, providing them with access to water for high-value crops. The precise circumstances of South Africa’s transition from apartheid rule to a nonracial, democratic society were exceptional. The ANC has provided the people of South Africa with the political leadership to support and initiate water and sanitation programmes in order to to serve the people of this country.

Water is available to irrigate 12 000 hectares in the Eastern Cape, Free State and Northern Cape. The Department of Water Affairs and Forestry is working with the national and provincial departments of agriculture to implement schemes to utilise these allocations.

Financial assistance is provided to emerging farmers for water infrastructure, as well as operational and maintenance courses. Some 485 058 farmers received financial support from the Department of Water Affairs and Forestry in 2003-04; R28 400 million was budgeted in 2004-05 to assist another 4 500 historically disadvantaged households.

Poor communities have a role to play in water and sanitation issues that affect them as the department restructures and introduces catchment management areas to ensure equitable, efficient and sustainable water resource management. The department will devolve administration down to local water users in communities, accompanied by vigorous capacity- building, so that historically excluded communities can participate in water management.

Before I continue I am watching this clock and it is driving me, because I always like to speak about something from my constituency. I would like to share this one important challenge that relates to my constituency in the Central Karoo. Along the main railway line from Cape Town to Johannesburg, which passes through the Karoo, we have several of these small towns or clusters of houses just next to the railway line - in the olden days they were called sidings. Now TransNet or SpoorNet has stopped servicing these people, and they have left these people to the municipalities, but because these clusters of houses are so far away from big towns it is difficult for the municipalities to service these people with water. I can name them; they are Prince Albert and Matjiesfontein.

What happens there now is that the white farmers who used to own that land, and it is unfortunate that I have to mention it, have boreholes. They make our people pay for the water that they get from these boreholes. I think this is a challenge, which I want us to address. [Time expired] [Applause.]

Mnr J W LE ROUX: Agb Voorsitter, agb Minister, LUR’e en kollegas, voor ek begin wil ek net vir u, mnr die Voorsitter, en die Hoofsweep bedank vir die goeie wense wat u teenoor mnr Watson uitgespreek het. Ek sal dit so gou as moontlik ook aan hom oordra. Baie dankie daarvoor.

Die bewaring van ons water- en plantebronne is vir al die mense van Suid- Afrika baie belangrik, maar ongelukkig is daar dekades lank in Suid-Afrika, en ook in die res van Afrika, te min aandag aan hierdie belangrike bronne gegee. Dit word algemeen aanvaar dat die toestand van ’n land se water en plantebronne direk verband hou met die lewenskwaliteit van die bevolking.

In ’n onlangse studie word daar beweer dat armoede in Afrika in ’n groot mate veroorsaak is deur die vernietiging van Afrika se natuurlike woude en habitat. Op hierdie oomblik is daar nog buitelandse maatskappye wat toegelaat word om natuurlike woude te vernietig. Swak en korrupte regerings laat ongelukkig toe dat hierdie fortuinsoekers een van Afrika se grootste bates vernietig.

In Suid-Afrika het ons nou nog ’n tekort aan geelhout en stinkhout as gevolg van die grootskaalse stropery wat in die vorige eeu plaasgevind het, en ongelukkig is weinig inheemse woude aangeplant. In Suid-Afrika is daar talle voorbeelde wat onteenseglik bewys dat die bewaring van ons habitat een van die beste skanse is teen armoede en agteruitgang.

Gebiede wat die meeste deur toeriste besoek word, naamlik die Kaapse fynbosgebied, die Tuinroete, die Knysna-woude en –mere, die Stormsrivier- gebied en die Baviaans is ’n bewys dat dit uiters voordelig is om inheemse woude en plante te bewaar.

Dorpe en stede wat hulle boomerfenis beskerm en uitgebrei het, geniet nou groot voordeel uit toerisme en beleggings. Stellenbosch, Kaapstad, Graaff- Reinet en Port Elizabeth, om net enkeles te noem, is sprekende voorbeelde. Mense besoek en belê baie eerder in mooi stede en dorpe as in onaantreklike, boomlose gebiede.

Daar is ook dorpe wat nie hul boomryke erfenis beskerm het nie, en hulle betaal nou die prys daarvoor. Mense wat verplig is om in sulke gebiede te werk woon liewer in nabygeleë dorpe wat esteties meer aanvaarbaar is en bestee hulle rande daar.

Wat die waarde en potensiaal van landbougrond betref, is dit duidelik dat hoe beter die habitat bewaar word, hoe hoër is die opbrengs op die grond en hoe hoër is die grondprys. Die armoede wat in sommige plattelandse gebiede ervaar word, is die gevolg van roofbou in die verlede en nog vandag.

Wat die aanplant van bome in stedelike gebiede betref, is dit so dat in die verlede daar geen aanplantings in ons arm woongebiede plaasgevind het nie. Daar behoort nou dringend op groot skaal in hierdie gebiede bome gevestig te word.

In baie lande word straatbome geplant met ’n potensiële ekonomiese waarde sowel as voedingswaarde.

In Suid-Afrika kan met groot welslae geelhout-, stinkhout-, nieshout-, pruimbome, ens, aangeplant word, ook met die doel om later te oes. Daar word beweer dat ’n geelhoutboom ná 30 jaar tot R10 000 werd is. En u kan my glo, 30 jaar gaan baie vinnig verby! Vrugte- en neutbome behoort ook aangeplant te word en kan as ekstra voedingsbron benut word.

Wat ons waterbronne betref, is dit so dat ons alreeds watertekortes ondervind en die probleem word al erger. Dwarsoor die land verloor ons miljoene liters water net omdat infrastuktuur nie in stand gehou word nie. Die Minister het verwys na die baie huise wat nou gebou word en ek dink dit het nou tyd geword dat elke woning wat met behulp van ’n subsidie gebou word, ook ’n watertenk moet hê. Hierdie water kan baie effektief gebruik word om groente en vrugte vir die gesin te kweek.

Die bewaring van ons waterbronne behoort baie groter aandag te geniet en plaaslike rade wat ooglopend toelaat dat pype en krane nie herstel word nie, behoort gepenaliseer te word.

Wat egter die grootste kommer wek, is die agteruitgang van die kwaliteit van ons water. Daar is talle skokkende voorbeelde soos die Hartebeespoortdam, die Bergrivier in die Wes-Kaap en die Swartkopsrivier in die Oos-Kaap.

In die Bergrivier is nou onlangs besoedelingsvlakke van 34 miljoen E. coli per 100 ml water gemeet. As ons in aanmerking neem dat 1 000 eenhede E. coli per 100 ml as gevaarlik beskou word, kan ons net dink watter gevaar dit vir die mense inhou wat hierdie water daagliks moet gebruik. Die buitelandse kopers van ons vrugte is reeds bewus van hierdie besoedeling en die hele vrugtebedryf van hierdie gebied is in gevaar.

Die oorsaak van E. coli-besoedeling is rioolafval wat in die riviere beland. Die swak plaaslike rade word aanspreeklik gehou en drastiese optrede deur die regering is nou noodsaaklik. Onbevoegde ANC-rade is verantwoordelik vir hierdie toedrag van sake in die Bergrivier.

Wat die Swartkopsrivier betref, is die toestand daarvan ook baie sleg. Vlakke van E. coli-besoedeling van tot 800 000 eenhede per 100 ml water is al gemeet en dringende aandag is hier ook nodig. (Translation of Afrikaans paragraphs follows.)

[Mr J W LE ROUX: Hon Chairman, hon Minister, MECs and colleagues, before I begin, I just want to thank you, Mr Chairman, and the Chief Whip for the good wishes which you expressed to Mr Watson. I shall also convey them to him as soon as possible. Thank you very much.

The conservation of our water and plant resources is very important to all the people of South Africa, but unfortunately for decades in South Africa, and also the rest of Africa, too little attention was paid to these important resources. It is generally accepted that the condition of a country’s water and plant resources is directly linked to the quality of life of the population.

In a recent study it was alleged that poverty in Africa is caused to a large extent by the destruction of Africa’s natural forests and habitat. At this moment there are still overseas companies who are being allowed to destroy natural forests. Bad and corrupt governments unfortunately allow these fortune hunters to destroy one of Africa’s greatest assets.

In South Africa we still have a shortage of yellow-wood and stinkwood as a result of the large-scale plundering which took place in the last century, and unfortunately few indigenous forests were planted. In South Africa there are many examples that prove conclusively that the conservation of our habitat is one of the best bulwarks against poverty and decline.

Areas that are most often visited by tourists, namely the Cape fynbos area, the Garden Route, the Knysna forests and lakes, the Storms River area and the Baviaans are proof that it is extremely advantageous to conserve indigenous forests and plants.

Towns and cities that have protected and extended their arboreal heritage now enjoy a great advantage with regard to tourism and investments. Stellenbosch, Cape Town, Graaff-Reinet and Port Elizabeth, to name but a few, are shining examples. People much rather visit and invest in pretty towns and cities than in unattractive, treeless areas.

There are also towns that have not protected their abundant arboreal heritage, and they are now paying the price. People who are forced to work in such areas prefer to live in nearby towns, which are aesthetically more acceptable, and they spend their rands there.

As regards the value and potential of agricultural land, it is clear that the better the habitat conservation, the higher the yield and of the price of the land. The poverty that is being experienced in some rural areas is the result of overcropping in the past and still today.

With regard to the planting of trees in urban areas, it is true that in the past no plantings took place in our poor residential areas. There should now be a large-scale planting of trees in these areas as a matter of urgency.

In many countries street trees are being planted with potential economic value as well as nutritional value.

In SA yellow-wood, stinkwood, sneezewood, plum trees, etc, are being planted with great success, also with the purpose of harvesting later. It is said that a yellowwood tree is worth up to R10 000 after 30 years. You can believe me, 30 years pass very quickly! Fruit and nut trees should also be planted and can be used as an extra source of nutrition.

With regard to our water resources, it is a fact that we are already experiencing water shortages and the problem is getting worse. Throughout the country our people are losing millions of litres of water just because infrastructure is not being maintained. The Minister referred to the many houses that are now being built and I think the time has come that every house that is built with the aid of a subsidy must also have a water tank. This water can be very effectively used to grow vegetables and fruit for the family.

The conservation of our water resources should receive a lot more attention and local councils who openly allow pipes and taps to go unrepaired should be penalised.

However, the greatest cause for concern is the decline in the quality of our water. There are many shocking examples, such as the Hartebeespoort Dam, the Berg River in the Western Cape and the Swartkops River in the Eastern Cape.

In the Berg River pollution levels of 34 million E. coli per 100 ml water were measured. If we take into consideration the fact that 1 000 units of E. coli per 100 ml are regarded as dangerous, we can just imagine the danger it poses for the people who have to use this water daily. The overseas purchasers of our fruit are already aware of this pollution and the entire fruit industry of this area is in danger.

The cause of E. coli pollution is sewage that flows into the rivers. The incompetent local councils are held liable and drastic action by the government is now essential. Incompetent ANC councils are responsible for this state of affairs in the Berg River.

With regard to the Swartkops River, its condition is also very poor. Levels of E. coli pollution of up to 800 000 units per 100 ml of water have already been measured and urgent attention is also required here.]

The Work for Water Project has been a useful short-term job creation project and should be extended.

The targets the President has set as far as clean water and sanitation is concerned will clearly not be met. Two main stumbling blocks are the lack of funds, and even more important is the fact that local government is not capable of delivering. The fact that the sale of bottled water is so popular is further proof that people are losing faith in local councils to guarantee clean water in our homes. I thank you. [Applause.]

Mnr F ADAMS: Agb Voorsitter, ek sien nou met die nuwe horlosie hier het ek nou meer tyd gekry. Dankie daarvoor!

Elf jaar gelede het ons demokrasie ’n gedaanteverwisseling ondergaan. Die mense van Suid-Afrika het gepraat en gesê: “Ons het vertroue in die regering, want ons wil effektiewe dienslewering sien plaasvind.”

Een departement waarin daar effektiewe dienslewering plaasvind, is die Departement van Waterwese en Bosbou. As ek so kyk, sien ek daar geskied baie implementering. Baie navorsing word gedoen. Ek dink nou aan wat die agb kollega hier voor my gesê het van die Bergrivier, maar ek wil hom net herinner dat die DA tot twee jaar gelede nog die Bergrivier beheer het, en as ek reg onthou, was hulle teen die bou van die Skuifraamdam in die Wes- Kaap. Ek wil dus graag vir my geagte kollega sê: Mense wat in glashuise woon moenie met klippe gooi nie.

Water is ons belangrikste bron, want sonder water kan ons nie lewe nie, en water is so belangrik dat elkeen van ons ’n belangrike plig het om ons moue op te rol om te kyk dat water nie gemors word nie. Die departement doen baie goed, en ons wil die Minister en haar departement bedank vir die dinge wat hulle in Suid-Afrika doen. Ons bedank ook die Waternavorsingskommissie, wat teen groot koste navorsing doen.

Ek kyk na Suid-Afrika as ’n ontwikkelende land, en baie van die ander ontwikkelende lande het Suid-Afrika nou pas genader om hulp. Ek sien in die jongste Water Wheel staan: “SA expertise recognised in Thailand”. Daar is baie goed waarop ons verbeter het.

Daar is baie goed wat hierdie regering van die ou regering oorgeërf het, waarop hulle verbeter het. Ons moet ons dank uitspreek daarvoor. Ons moet waardering toon daarvoor. Ons kan nie net afkraak en elke keer net wil afbreek nie; ons moet ook waardering toon aan wie dit toekom. Ons moet erkenning gee aan wie dit toekom, want hierdie tweede dekade van vryheid gaan van ons verwag om vir ons mense daar buite beter dienslewering te bied.

Kritiek in hierdie tweede dekade van vryheid gaan niks help nie, maar om die moue op te rol en voort te gaan om ’n nuwe Suid-Afrika en beter lewe vir ons mense daar te stel gaan ons help om van Suid-Afrika ’n beter, meer bekostigbare en lekkerder land te maak om in te leef; nie ’n land waarin ons elke ding afkraak wat die regering doen nie, maar ’n land waarin ons met trots kan staan en sê: “Suid-Afrika, ons land! Ons, die volk van Suid- Afrika, sal saamstaan om dit verder ’n beter land te maak.” Die NNP steun hierdie begrotingspos. Ek dank u. Applous.

[Mr F ADAMS: Hon Chairperson, I see that now that we have a new clock I have been given more time. Thank you for that!

Eleven years ago our democracy underwent a metamorphosis. The people of South Africa spoke and said: “We have confidence in the government, because we want effective service delivery.”

One department in which there is effective service delivery is the Department of Water Affairs and Forestry. When I look at it, I see that there is a great deal of implementation. Much research is being done. I am now thinking of what the hon colleague who spoke here before me said about the Berg River, but I just want to remind him that until two years ago the DA controlled the Berg River, and if I recall correctly they were opposed to the building of the Skuifraam Dam in the Western Cape. I would therefore like to say to my hon colleague: People who live in glasshouses should not throw stones.

Water is our most important resource, because without water we cannot live, and water is so important that each one of us has an important duty to roll up our sleeves to ensure that water is not wasted. The department is doing a great deal, and we wish to thank the Minister and her department for the efforts that they are making in South Africa. We also thank the Water Research Commission, which undertakes research at great cost.

I see South Africa as a developing country, and many of the other developing countries have recently approached South Africa for assistance. I see in the latest Water Wheel that it states, “SA expertise recognized in Thailand”. There are many things which we have improved upon.

There are many things that this government inherited from the old government upon which they have improved. We must express our appreciation for that. We must show appreciation for that. We cannot just criticize and just want to be destructive; we must also show appreciation to those who deserve it. We must give recognition to those who deserve it, because in this second decade of freedom it will be expected of us to deliver better services to the people out there.

Criticism in this second decade of freedom will not help one jot, but rolling up our sleeves and going ahead with creating a new South Africa and a better life for all our people will help us to turn South Africa into a better, more affordable and nicer country to live in; not a country where we run down everything the government does, but a country in which where we can stand proud and say: “South Africa, our country! We, the people of South Africa, will unite to continue to make it a better country.” The NNP supports this Budget Vote. I thank you. [Applause.]]

The CHAIRPERSON OF THE NCOP: Thank you, hon member. The hon Mzizi of the IFP.

Kunewashi-ke lapho mntakababa. Ungalindeli mina ukuthi ngikutshele ukuthi uhlale phansi. [There is a clock there, my brother. You must not wait for me to tell you to sit down.]

Mnu M A MZIZI: Ngiyathokoza Sihlalo. Ngiyabona ukuthi udokolwane usekhona lapha ongigadile. Kuhle-ke lokho. KuNngqongqoshe kazwelonke noNgqongqoshe bezifundazwe nakozakwethu, unwele olude. (Translation of isiZulu paragraph follows.)

[Thank you, Chairperson. I am grateful that the clock is still there, timing me. That is good. To the national Minister, the MECs and my colleagues, long live!]

Chairperson, it is indeed a pleasure for me to take part in this debate. May I from the outset single out water? It is a known phenomenon that water is indispensable in our lives. Without water there will be no life. Without water in our bodies the result is death. Having said that, it does not mean forestry is less important.

Mandulo, ithekhnoloji ingakaziwa kuleli lengabade amahlathi ayedlala indima ebalulekile kubantu ngobubanzi. Namanje amahlathi asayidlala leyo ndima. Ayagawulwa amahlathi sithole izingodo zokwakha siphinde siwagawule sithole izinkuni zokubasa, kwande njalo sakhe izihlalo sakhe ngisho namafenisha. Kuningi esingakubala.

Okunye okubalulekile ukuthi izingodo ziyagawulwa kwenziwe amaphepha. Kuningi esingakubalula ngalezi zihloko ezimbili. Ngqongqoshe, ngabe kulesi sabelomali siyokwazi ukuhlinzekela izidingo nezingqinamba ezibhekene namanzi namahlathi na? (Translation of isiZulu paragraphs follows.)

[In the past, when the technology was not known in this African country, forests played a vital role in the lives of all citizens. Even now the forests are still playing that role. Forests are cut down for wood to build with, firewood and to make furniture. There are many purposes we can mention.

The other important thing is that wood is also cut down to make paper. There is a great deal we did not mention about these two topics. Minister, will we be able to cater for the needs and the impediments facing water and forests with this budget?]

During rainy seasons, rivers flow down into the sea. During droughts rivers and dams become dry and this affects even underground water. During the dry season trees do not grow. During winter we get veld fires more often and large tracts of forests are destroyed. Trees are not like grass. They take time to reach the stage of consumption.

In your budget, Minister, can we say: Come what may come, we will face the music and overcome any difficulties we face? The IFP would wish that a budget should have more room to meet all challenges …

… uma kufika lezo zikhathi amanzi esephelile namahlathi esephelile. I-IFP iyasixhasa isabiwomali. [Ihlombe.] [… when the dry season comes and when the forests are finished. The IFP supports the budget. [Applause.]] RULING

The DEPUTY CHAIRPERSON OF NCOP (Ms P Hollander): Before I call the next speaker, I promised this House that I would give my ruling on the debate on Budget Vote 2 in Parliament on 24 May 2005. The hon Watson made the following remark: “… the hon Setona’s defamatory lie about the leader of the DA, Mr Tony Leon”. The hon Kgoshi Mokoena raised it as a point of order that it was unparliamentary for one hon member to say that another hon member had lied. I was the officer presiding at the time, and since I was in agreement with the point of order raised by hon Kgoshi Makoena I asked the hon Watson to withdraw his words. The hon Watson replied that he would withdraw the word “lie” and substitute it with the word “statement”. Since the hon Watson was continuing to use the word “defamatory” in describing the statement, I asked the hon Watson once again to withdraw his remarks, because to say that a statement was defamatory amounted to saying that the person who made the statement was lying. Despite my asking the hon Watson more than once to withdraw his words he refused.

Hon members, when the officer presiding has made a ruling, as I had done, and the member to whom the ruling was directed refuses to abide by the ruling, that is showing contempt for the officer presiding and contempt for the proceedings of this honourable House because the officer presiding represents the authority of the House.

NCOP Rule 37(1)(b) provides that the officer presiding may order a member to leave the Chamber immediately for the remainder of the day’s sitting if the officer presiding is of the opinion that the member concerned is in contempt of or is disregarding the authority of the Chair.

On 24 May 2005 I did not invoke the provisions of Rule 37(1)(b), but instead indicated that I would provide a ruling at a later stage, which I am doing now. It is my ruling that on 24 May 2005 the hon Watson disregarded the authority of the Chair by refusing to withdraw his words after being asked by the officer presiding to do so.

Where a member has concerns about a ruling which has been made, the member should raise that matter outside the House with the office bearer who made the ruling, either orally or in writing. The member should not disregard the authority of the Chair by failing to abide by the rulings in this House. I thank you.

Ms B N DLULANE: Hon Deputy Chairperson, hon Minister, “baphathiswa bamaphondo” [hon MECs], hon members, ladies and gentlemen, “nawe Mnu Dlulane omncinci osegalari, nomakazi wakho” [and you Mr Dlulane junior in the gallery, together with your aunt], addressing Parliament during her Budget Vote debate on 18 May 2005, the hon Minister of Water Affairs and Forestry outlined the new role of her department in respect of water supply and sanitation.

She said that she was breaking with tradition and that her department no longer manages the investment budget, but focuses on whether services are provided effectively and sustainably.

Rural sanitation remains a major challenge and the health consequences thereof were demonstrated by the recent outbreaks of cholera and bilharzia in Mpumalanga, and the tapeworm infestation in Coza village in the Eastern Cape, where my constituency is. Over the past three years the Eastern cape has been attacked by a series of water-borne diseases, which include cholera and typhoid. More than 80 lives were lost to cholera and at least two children died from water-borne diseases, and more than 6 000 people were treated in hospitals throughout the province.

All these outbreaks can be attributed to a lack of access to clean water in the former Transkei region. We are amongst the 3,6 million people who have no access to basic water services, which the Minister alluded to.

I still remember when the late former leader of the ANC and Communist Party, Comrade Chris Hani, during the unbanning of our organisation, went to Coza village at Libode. He said, “Look, even today our communities are still drinking “amanzi anezabonkolo kunye neenkomo neehagu” [unclean water together with cattle and pigs], and that is the reason we still have these diseases at Coza. The water service budget of the department is thus reduced from R2 608 million to R1 334 million. My question, hon Minister, is: Given this huge backlog that we are faced with, how are you going to cope? I do understand that some of Dwaf’s responsibilities and other roles have been taken to municipalities, but I’m wondering whether this budget is enough for you to complete whatever you thought you would deliver.

In its second decade of democracy our government is prioritising its capacity to deliver goods and services in an efficient and cost-effective manner. A renewed emphasis on monitoring linked to delivery is evident, and on the basis of the programme of action announced by our President in his state of the nation address, these policy priorities and challenges shape the 2005 budget.

Water, sanitation and hygiene are vital components of sustainable development and poverty alleviation. Our country is one of a few in the world that formally recognise water as a human right. Our national water and sanitation programme, which is one of the largest national programmes in Africa, aims to deliver sustainably on that right. Both the recognition of water as a human right and the development of the national water and sanitation programme derived from the advent in 1994 of South Africa’s democratic era.

The dictionary describes water as colourless, tasteless, and odourless, its most important property being its ability to dissolve other substances. However, we in South Africa do not look at water from that perspective. For us, as I have already mentioned, water is also a basic human right. It is the origin of all things, the giver of life. There is water within us. Let there be water with us.

Water never rests. We want the water of this country to flow out into a network, reaching every individual. We want to say: Here is water for you, take it and cherish it as it affirms your human dignity and nourishes your humanity.

Water is a powerful symbol throughout the world, carrying with it ideas of baptism and new life, cleansing and healing, bootat’ umfundisi abalapha endlwini, [people of the cloth present in the House] and the promise of growth and prosperity. In contrast, the growing demands on a limited resource and the increasing scarcity of water could result in devastating conflicts and catastrophes.

Ukhe watsho ke uMphathiswa ukuba olu asilolwimi lwethu. Ngelinye ixesha siyaziluma sizama ukuluthetha, kanti olona lwimi lwethu siluncance ebeleni sisiXhosa. [The Minister has said before that this language is not our mother tongue. Sometimes we have a slip of the tongue. However, our mother tongue is isiXhosa.]

Our government has been confronted with a situation in which the majority of South Africa’s people have not only been excluded from the land, but have also been denied either direct access to water and sanitation for productive use or access to the benefits.

Asazi ukuba ngoobani ke abo ababevimba abantu bethu ilungelo lokufumana amanzi. [We do not know who deprived our people of the right to have water.]

The development of our society, our growing population, and the legitimate demands of the disadvantaged majority for access to these most crucial resources have placed new demands on what is, although renewable, a limited resource that can easily become polluted or overused. There is only so much water that falls on our land every year. So we need to engage ourselves in debates that can help us to come up with feasible strategies to manage this resource. We must not just throw stones; we must come up with solutions.

This policy debate on the Budget Vote on Water Affairs and Forestry is of great importance. It is estimated that over one million children a year die from water-borne diseases. Diarrhoea kills an equivalent of a jumbo jet full of children every four hours. This makes it the second biggest killer of children in the world. Lack of adequate sanitation facilities and unsafe hygiene practices contribute significantly to this situation, and this requires our urgent attention.

In Africa we are faced with a water and sanitation crisis. It is estimated that one in three Africans does not have access to adequate water supply and sanitation facilities, and that almost half of the people on this continent suffer from water-borne diseases.

None of us has a solution to this crisis. We all have a piece of the puzzle. This budget debate offers us an opportunity to put together these pieces of this puzzle so that we can launch a concerted campaign to address the backlog of water and the need for safer hygiene practices, and not create havoc by organising marches.

Mphathiswa, siyabulela. Sinqwenela ukuba ubajonge abantu abatya amanzi amdaka.[Kwaqhwatywa.] [Minister, I thank you. We would like you to give consideration to those who use unclean water. [Applause.]]

Mr J DOWRY (Western Cape): Hon Chairperson, hon Minister Sonjica, MECs and members of the NCOP, in the Minister’s budget speech of on 18 May this year, she referred to our celebration of the Freedom Charter and the strategic imperatives, which specifically include the eradication of poverty and underdevelopment.

As the government of the Western Cape we endorse the Minister’s view that we need to ensure that the way in which we use and manage the water resources of the country must ensure that we grow and transform the economy for the benefit of all the people.

The Minister said:

We cannot have water services without having water resources, which also support the needs of a growing economy. We are confronted by the major challenges of managing our scarce resources and extending service delivery to previously excluded communities. We also have an obligation to research and mitigate the vagaries of climate change.

Agriculture and water play a significant role in the Western Cape government strategies, namely, Ikapa Elihlumayo, a Home for All. Agriculture in this province cannot be ignored as the total input of the primary agricultural sector in the Western Cape grew from R10,4 billion in 1999 to R11,8 billion two years later.

The main industries in the primary agricultural sector include fruit R2,4 billion; winter grain R1,8 billion; white meat R1,6 billion; viticulture R1,6 billion; and vegetables R1,4 billion.

It is clear that this sector has grown consistently since our political transformation of 1994. Well over half of the country’s agricultural exports originate from the Western Cape. These industries are still on a strong growth curve, with especially the wine industry being an unqualified success. Census data showed that while manufacturing in the Western Cape shed 30 000 jobs, agriculture gained 32 000.

Drought and the need for water produce a complex web of impacts that spans many sectors of the economy and reaches well beyond the areas experiencing physical drought. This complexity exists because water is integral to our ability to produce goods and provide services.

It is not only the livestock and wheat industries that are impacted upon by the drought. Studies proved that the deciduous fruit industry would bear approximately 67% of the burden on the horticultural sector. The reason is quite simple; viticulture is a desert plant and could still be farmed successfully under conditions of deficit irrigation. It is also not uncommon in wine grape production to impose deficit irrigation as a quality enhancement strategy. Deciduous fruit production cannot cope with drought conditions to the same extent as wine grapes and would therefore be more susceptible to negative impacts.

The Deciduous Fruit Producers Trust estimates that current losses already exceeded R1 billion, if all forward multiplier effects are taken into account. Such a figure will have significant negative impacts on the 2 500 deciduous fruit producers and socio-economic impacts on more than 100 000 workers and 400 000 dependants.

The moment you have to apply water restrictions it has a negative multiplying impact on the total agricultural sector. Table grape producers, for example, are among the biggest losers with water restrictions in the Olifants River Irrigation District.

Losses in production are high, such as in the Hex River Valley where more than 1,5 billion export cartons of table grapes and 1 million for the Berg River area were registered. The production losses for the Hex River Valley are estimated at R180 million, and R100 million for the Berg River area.

It is conservatively estimated that the wine industry could lose R56, 5 million due to the lack of sufficient water supply. This phenomenon obviously also impacts negatively on agricultural employees. It has been calculated that some 2 075 permanent, and 2746 seasonal jobs can be lost in the wine, table grape and deciduous fruit industries alone, resulting in some R37,4 million income loss to these households.

As a responsible government we cannot ignore these warning lights and therefore the Department of Agriculture in the Western Cape attends to these needs on a continual basis by engaging in research on the process of multicriteria decision analysis in water resource management. Although not a new concept, current research applies the process over time and within regional context; compared to where specific projects with a localised context were targeted in the past.

Current research challenges conventional beliefs regarding the total cost of traditional expensive supply options, with the hypothesis, that if it was possible to quantify the total cost of water management alternatives, conventional supply alternatives could well be more expensive compared to seawater desalination or recycling to potable standard. The quality of water in our rivers plays a major role in the creation of a home for all in the Western Cape. It is a fact however that the quality of the water in our rivers varies from excellent to very poor, depending on the location and the activities taking place adjacent to the rivers or in the catchments areas of the rivers. In this regard, I have to draw the hon Minister’s attention to the situation in the Berg River.

The pollution of the Berg River is a topic that has received a lot of media coverage over the past couple of months and serious concerns have been expressed regarding the effect that the polluted water can have on the people using the water. The water is being used by farming communities for drinking water, as well as for irrigation of export fruits and vineyards.

The agricultural industry and rapid urban growth have taken their toll on water-scarce South Africa’s river systems, leaving almost three quarters of them endangered or critically endangered. This is among the findings of a recently released report containing the first-ever national assessment of biodiversity across the country’s marine, freshwater, estuarine and terrestrial environments.

It is in the public interest that Water Affairs consistently apply the Act that is in place and does the necessary policing and prosecution of transgressors.

The question follows: Who will act on behalf of the many people who rely on the water from these polluted areas, as their sole supply of drinking water, if we as the government do not fulfil our obligation to apply the National Water Act and prosecute polluters of our scarce water resources?

Municipalities sometimes create the impression that they are addressing the problem, whilst their efforts, in fact, contribute very little to solve the problem. Joint and focused efforts by all relevant parties are required to protect our rivers and thus our scarce water resources and ensure the safety of all the people using the water.

The Hex River Valley is one of the leading areas in the Western Cape when it comes to Black Economic Empowerment in agriculture. Emerging projects that have been embarked upon will need an extra 200 000 cubic metre of water. To address the shortfall in supply the Hex River Valley Irrigation Board drafted a master plan in which the Osplaas Dam was identified as the solution.

The Board submitted an application for the building of the dam to the Department of Water Affairs two years ago, as well as an application for an environmental impact permit. No controversial issues were found during the investigation. I want to make use of this opportunity to request the hon Minister to give her personal attention to this project as it could unlock a further potential of the valley for BEE in agriculture.

The loss of water from the Breede River that is annually flowing away into the ocean is also a big concern to farmers who are willing to look at a joint venture with government in an effort to use available water to its maximum, within the permissible limits of conservation.

I want to thank the Minister for being the major driving force behind the investigations that include the Oudtshoorn Agricultural Water Study and a similar study for George as well as the preliminary investigations and feasibility studies. Minister, water will in future become … [Interjections.] [Time expired.] [Applause.]

Mr R J TAU: Hon Chair, Minister, hon members, officials from the department, comrades, we have noted that generally land use in South Africa has been poorly planned with resultant inefficiencies, inequities and environmental degradation. Although the most glaring consequences arise from the apartheid policies as applied in the former homelands – the effects are evident throughout the rest of the country, hon Le Roux - in the forest sector, some consequences of inadequate land-use planning are seen in land disputes, the conflicts about water resources, concern over loss of land suited to crop agriculture and the loss of habitats for native species. Previous forestry development strategies were formulated in the context of inadequate or inappropriate overarching policies, without sufficient consultation.

The combination of acidification and forestation effects have been found to be comparable to areas mostly affected by acid rain to the worst degree in the industrialist countries of the Northern hemisphere. The loss of nutrients is worsened by the increasing acidity of rainfall over much of the region principally caused by industrial pollution.

About one sixth of the plantations in South Africa are on soils with high risk of acidification due to shallowness, low buffer capacity or low base status. In order for plantation forestry to be sustainable in the long term on the sites, fertilisation or other mitigating matters will be required and we appreciate what the department is doing in this regard.

As a committee we have noted that forestry has a wide scale of impact; an example is the impact on river water that flows through protected areas such as the Kruger National Park. This, together with other factors such as irrigation, abstraction and the prolonged drought have jeopardised aquatic ecosystems, and brought about an alteration of the landscape-effect perceived scenic value. Different observers perceive afforested landscapes differently; it seems as if many visitors to areas such as Mpumalanga perceive the afforested landscape as attractive, but many people who appreciate the South African landscape do not.

The injudicious layout of plantations frequently, of course, offends the eye. However, the forestry industry has implemented guidelines to prevent this, for example, forestry companies have cleared and maintained at least 28 000 kilometres of riparian zones on their estates, which would effect a significant aesthetic improvement.

The principle of managing towards sustainability is being pursued internationally by developing criteria, according to which forestry may be judged sustainable or not, and indicators for assessing forestry against each criterion. Such criteria and indicators need to be applied also at the level of firms or operating units within the firms, such as plantation estates. These assessments may be limited to certification of operations or forest products, so that firms and operations may be accredited and products may be certified as coming from sustainable forestry, that is, so- called green labelling of forest products.

The forestry companies in South Africa have responded by subscribing voluntarily to best practice guidelines for environmental management. The guidelines for environmental conservation management in commercial forests in South Africa are widely implemented in the companies. These companies have developed self-assessment procedures to ensure application of the guidelines, incorporating them into the guidelines and instituting monitoring and evaluation procedures.

The SA Timber Growers Association effectively encourages smaller private growers to use the guidelines. However, it is important to note that the fact that the system is not legally binding is a serious weakness. Accreditation through the statute of an independent body with the resources to provide clear evaluation and certification of environmental management in forestry could protect the interests of the sector, as well as protecting the environment.

The growth of the forestry industry in the past two decades has largely been through expanded exports of wood chips, pulp and paper. Domestic consumption has grown little. However, we are likely to see a considerable increased in the domestic consumption in the next two decades. Exports would be maintained and certainly increased in some cases, such as the dissolving pulp and other value-added products. This trend is desirable since it will address domestic needs and the opportunities available in global trade.

The demand for roundwood has increased considerably. To date the main response to increase demand yield has been to plant more land rather than to increase yield efficiency.

As I mentioned above, domestic demand for wood in South Africa will increase in the foreseeable future, owing to economic growth in per capita consumption of wood-based products, such as paper, from the current low base. This rising demand will tend to encourage further expansion of plantations. However, expansion will be constrained by the competition for land and water resources, and by environmental and social conditions.

New afforestation has increased the total area of plantation by 17 000 ha per year recently. New afforestation has slowed down, however, as a result of very few permits having been issued in the last year. Potential productivity of these forests is relatively high by world standards, averaging about 20 m3 per hectare per annum. They currently yield about 18,5 to 19 million m3 of wood per year, which satisfies over 90% of domestic demand and provides for a surplus for exports, largely as pulp paper, wood chips and other products. The average released yield of about 13m3 per hectare per annum is lower than the average potential productivity because many plantations are still young. About 7% to 8% of plantation land is temporarily unplanted.

Many forest operations are on land where people were displaced in the past. Claims for restitution of land rights are to be dealt with through the mechanisms of the Restitution of Land Rights Act. The Act stipulates that people who lost their land rights because of a racially discriminatory law shall be entitled to of the land they lost or receive appropriate compensation. Certain areas of state forest land, state land in Safcol’s hands, as well as privately-owned land, are likely to become subject to restitution claims.

Other claims, such as the ownership of security of tenure by labour tenants where their prior rights have been jeopardised by sale of the land to forestry companies, for example, in Mpumalanga, or claims of need arising from land shortages and lack of alternatives, for example, land invasion and high population density of newcomers or squatters on forestry land, are not addressed through the restitution process. Prompted by pressure from labour tenants, various forestry companies have negotiated with these claimants and the negotiations have led to innovative solutions accommodating the interests of both parties.

The department recognises the urgency of the labour reform programme and will therefore facilitate restitution of land rights where possible. Where land claims are lodged against state land the department will co-operate with the Minister of Land Affairs, or examine whether restoration is foreseeable and feasible and will assist in order to achieve speedy resolution of the claims. Community forestry is designed and applied to meet local, social and environmental needs and to favour local economic development. It is implemented by communities or with the participation of communities. It includes farm forestry, agriforestry, community or village planting, woodlots and woodland management by rural people, as well as steep planting in urban and periurban areas.

I might disadvantage myself of the few seconds left, but I want to take the opportunity to react to a statement made by Mr Le Roux. He said that now of late people have opted to buy bottled water and that that is an expression of showing lack of confidence in our government’s provision of water. Perhaps the key question that I must put to Mr Le Roux should be: Who buys this water? Surely not the rural poor, surely not the unemployed and surely not the destitute, but those who want to create an impression and perception that the ANC government is failing to provide water to the rural unemployed, and so forth. As the ANC we support the Budget Vote. [Time expired.]

The MINISTER OF WATER AFFAIRS AND FORESTRY: Chair, I want to thank the hon members for a very interesting debate. I will quickly respond, although not to everybody. It was really a very interesting debate.

Rev Moatshe, thank you very much for your comments. I just want to say that sanitation has been prioritised by the department, hence the injection of R1,2 billion. It is because we have been talking and mobilising funds. I appreciate the problem that you raised, but I must say that it is one of those very difficult services to implement. We are trying very hard, and we are looking at all other options that can help us. We are almost certain that we will reach the target of 2010, as set by the President. We are almost certain of that.

Let me take this opportunity to underscore that our policy says that the sanitation services for densely populated areas in the townships should be waterborne systems. You can’t take a waterless toilet to KwaZekele, because KwaZekele is a very densely populated area. This is policy, and I want to impress this upon municipalities, because in the hastiness of wanting to reach the target, you find that people look at the easy options of providing waterless toilets in densely populated areas.

When you discuss this with them, they will say that they will come back and do an upgrade. I think that is a waste of taxpayers’ money. I think it is important that we do the right thing for our people, especially if we attach respect to them, and we want to give them the dignity that they deserve.

Hon Mack, I will link you up – he’s not in the House. Oh, he is - I will link you up with the regional office on the matter that you raised about the houses along the railway line. I think it is a very important matter that you raised there.

We are already working together with the Department of Housing and the Department of Local Government on a policy for providing water on private land, and this would include people who live on the farms and our farmworkers, because they also are affected by the same problem that you have raised here. They have to pay for water which is not actually in the dams on those farms. Again, according to the Constitution, whoever sells water, especially if that person does not have a licence, that person is violating our law; we can deal with the person. “Simvalele ngaphaya kwezitshixo”. [And put him or her behind bars.]

Mr Le Roux, your statement that the targets will not be achieved in terms of water supply because of lack of cash is one that I do not agree with. It is not true. Yes, we have challenges of capacity, but we are working on these with the Department of Provincial and Local Government. Of course, as already indicated, sanitation is a serious challenge.

I am not going to respond on the issue of bottled water. I think Mr Tau handled that question even better than I did. I just want to raise an interesting point about a comment that Mr Le Roux made – the price of a litre of bottled water can buy 1 000 litres of pure, safe tap water. However, some people – you’ve said all there is to say – want to show off that they are wealthy and have a lot of money. Again, the quality of South Africa’s water is one of the best in the world. We are one of the best in the world. You can go to any tap and open it and drink. I drink water from the tap. Everybody from my department, even the engineers, drink water from the tap. In this House we drink water from the tap.

We should not exaggerate and take things out of proportion, because this is going to affect us negatively. The tourism industry will be affected. I am saying we should be very careful about the statements that we make here.

I am tempted to respond to many issues that you raised, Mr Le Roux. Afforestation and urban greening are programmes under my department. We deal with leakages and matters like that. There are programmes that are running, even as we speak, to deal with those problems. I am almost certain that a lot of the municipalities are almost on top of the issue. Even this issue of capacity shouldn’t be blown out of proportion. There are municipalities that have serious capacity problems. That is why local government has created Project Consolidate that identifies 139 municipalities that are lacking in terms of capacity, whether it’s technical or financial capacity. We have a strategy already in place to deal with such capacity problems. We should not exaggerate the issue.

Hon Dlulane, on the point that we do not have enough funds, of course we do not have enough funds, but as you know, the functions have been transferred to local government. We actually helped mobilise funds for local government. For example, there is the R1,2 billion for sanitation that we recently received from Treasury.

With regarding to the threat of drought and the effect of water shortages on agriculture, we have been meeting with organised agriculture to ensure that the new water pricing strategy will not penalise them during a drought. We are sensitive to all of those things.

I must say that there is a strategy that guides us as to what we should do when there is a need or a scarcity of water in a particular area. I think it is a strategy with which people need to familiarise themselves since it does guide us. What is important when there is a drought is that we try to ensure that we do not get to a situation where the reserve is threatened. The reserve is that amount of water that has to remain in the dams for domestic use. So, when there is a drought, we sacrifice other things so that you and I are still able to get water from the tap, even if there is a drought, because this is one commodity that you cannot afford not to supply to people all the time. We need water all the time as people for our health and for our domestic use.

So, we always ensure that that reserve is not affected, but I do appreciate your comments. Again, we are co-operating with the Minister for Land Affairs and Agriculture to look at technology that will help us save water and other things that we can do to ensure that agriculture has water available for it. It is quite an important area, and you are quite right in saying that it contributes a lot to the second economy because of its location. Agricultural projects are mainly in rural areas and, for that reason, our people are mainly involved in agricultural projects.

It looks like I’ve dealt with all the issues, but it looks like I have one minute left. Let me see what I can say in this minute that is left. We have a river health programme. This is an important point that was raised. For the Western Cape, there is a report that is outstanding. All the provinces embarked on a programme of going to the rivers and testing the water, and they have to compile a report and present it to the department. The Western Cape’s report will be the second one that we should be receiving, and I think there is a sense of urgency on this matter. I don’t think we will have to wait for all the reports to come through to the department. We might have to embark on an awareness programme so that we can educate our people on protecting the rivers because along the banks of these rivers are informal settlements where our people stay. So, we need to embark on an awareness programme and help them understand the need for them to preserve and protect the water in the rivers.

The last thing to do would be to thank everybody for all their inputs, even those people to whom I did not respond. I appreciate your contributions, it’s just that the clock is ticking, and I have only a few seconds remaining. Thank you very much for supporting the budget. [Applause.]

The DEPUTY CHAIRPERSON OF THE NCOP (Ms P Hollander): We thank the hon national Minister for Water Affairs and Forestry. Minister, we thank you for your informative and consultative debate. We appreciate your presence here today. We say: Go well, and continue the good work. Thank you.

                         APPROPRIATION BILL


                         (Review of policy)

Vote No 33 – Transport (Review of policy)

The MINISTER OF TRANSPORT: Madam Chair, hon members, my colleagues - MECs of transport - and all hon members, the transport portfolio is a complex and cross-cutting affair. An effective transport system is very essential to the wellbeing of any country or community, but the effective operation of that system depends on the interrelationship of a number of factors, including governance, authority, responsibility and funding.

Schedules 4 and 5 of our Constitution define concurrent and/or exclusive transport functions that reside with different spheres of government. Therefore, public transport, road traffic regulation and vehicle licensing are concurrent functions of the national and provincial spheres. Provincial roads and traffic is an exclusive provincial function; and municipalities are responsible, where relevant, for municipal airports, municipal public transport and roads. Specialist agencies and authorities, accountable to the national sphere of government, deliver specific transport services across our country, and include the Roads Agency, the Commuter Rail Corporation and the Road Traffic Management Corporation; and they all have a direct impact on all provinces.

In funding the picture is equally complex. Some concurrent functions depend on the Department of Transport’s Budget Vote, but others rely on allocations to provinces determined by the equitable share formulae and outlined in the Division of Revenue Act. The exclusive provincial and municipal functions depend on own revenue and on conditional grants from provinces and national government to municipalities. Section 26 of the Division of Revenue Act outlines specific responsibilities to Ministers of portfolios that traverse the Constitution’s Schedule 4 functions.

An outline of this complex network should focus attention on where the buck really stops in the provision of certain transport functions and services. In short, all spheres of government have specific, exclusive and shared responsibilities that we must all exercise. We must exercise these in the interests of promoting an integrated, beneficial and targeted transport policy and strategy. The key transport concerns of the National Council of Provinces are public transport and roads.

We met last month in a transport lekgotla as a transport family to map a transport masterplan to serve as the framework to guide provinces, municipalities and other state department in their delivery of key transport infrastructure. Clearly, capacity at all levels, but particularly at provincial and local level, will be critical if we are to succeed in this particular regard. I would like this afternoon to focus on provincial issues that emerged from that very successful engagement of the transport family.

Many of the local sphere Integrated Development Plans, IDPs, and the accompanying Integrated Transport Plans, ITPs, emphasise public transport, and rail in particular, as the backbone of their transport systems. Most note that success is related, if not totally dependent in some instances, on the key issues of transport connectivity, greater mobility and access. For example, the city of Tshwane knows that the development initiatives to the north of the city require certain critical interventions by the three spheres of Government if their pro-poor and pro-working vision is to become reality. There are still many areas where we need to make significant improvements, despite the many strides we are making as a collective. The provision of roads is one of these.

It is clear that the construction and/or expansion of roads by many of our municipalities is not done in accordance with the ITPs and IDPs. I agree with the Financial and Fiscal Commission that it will only be possible to determine which sphere is responsible for addressing the backlog in construction, rehabilitation and carrying out maintenance duties once we have finalised the new road classification system. Many provinces have grasped the importance of this issue and are beginning to take positive advantage of the importance of road maintenance. I can also assure provinces, like the Northern Cape for example, that I have noted that they are struggling to balance the need for new projects with the need for maintenance.

We already have in place a system that allows for the reclassification of some provincial roads to the national system under the control of the Roads Agency. This process will continue this financial year with proposals that affect mainly Mpumalanga and the Free State; and Sanral is also in discussion with North West province.

However, the Financial and Fiscal Commission also suggests that the current reclassification may be happening on an ad hoc and arbitrary basis. They highlight two issues that we cannot resolve now, but we should consider how to avoid them further down the line. The first relates to the transfer occurring without a requisite transfer of funds; and secondly, that we must not forget the equitable share formula, especially when road reclassification is not taking place in all provinces.

Another element is the suggestion that the strategy on expanding roads has not strengthened the role of public transport. Rather, a great deal of roadworks, for want of a better term, seems to promote the interests of motorists and individual car-users above the requirements for an efficient and reliable public transport system. Our department has undertaken work to develop a travel demand management strategy aimed at addressing these issues, as well as challenges posed by congestion in our metropolitan centres. This strategy will be finalised by the end of November this year, and be ready to be piloted in the first half of 2006.

I would like to see some work that correlates the deterioration of roads from heavy truck transport with congestion on routes mainly by commuter traffic or private vehicle use, and with the manner in which roads projects actually fulfil the purposes agreed upon. For example, road safety enhancement projects dominate in rural areas, but we need to see whether they are in fact having an impact.

A major subject of discussion at our transport lekgotla that I mentioned was the issue of effective and integrated planning. The failure to ensure greater co-ordination between spheres will undermine our ability as a democratic state to achieve some of our strategic objectives. Recent problems, including taxi violence in some of our provinces, have highlighted very strongly the lack of effective planning and co-ordination between the three spheres of Government.

Last year we promised to introduce significant, short-term improvements in the public transport system. In the National Assembly last week, we highlighted the consolidation of passenger rail and the Taxi Recapitalisation Programme. An element I did not touch on in the National Assembly, but which is central to the concerns of provinces, is the issue of bus subsidies.

The public transport subsidy is allocated to the Department of Transport; but the actual design, day-to-day administration and management of bus services are delegated to the nine Provinces who are the direct employers of bus operators rendering services to all the provinces. The agreements we have with provinces aim to ensure that certain public transport minimum standards are met, and that the requirements of the law, such as the PFMA are adhered to at all times.

Ultimately, the Department of Transport is responsible for ensuring that these services are provided to all commuters in a safe, reliable, affordable and cost-effective manner. We have seen, and of course we do accept, that we have constitutional responsibilities in this regard which we cannot ignore.

A key need is to get rid of the current month-to-month interim contracts that dominate the bus industry. These interim contracts create uncertainty, which is not conducive to investment in the bus fleet, skills development and new equipment. They are difficult to manage and have also been open to fraud. Most of all, the interim contracts reflect the old, apartheid funding model, where the bulk of the funding was directed at providing bus services to enable a reliable supply of cheap, African labour in the major centres of the so-called white South Africa.

This inequitable allocation of the bus subsidy has robbed many poor South Africans of access to public transport services. We are working with provinces, for an example, with the Eastern Cape to correct the distortion whereby the lion’s share of the bus subsidy is spent on the western side of that province, while King William’s Town and the border region, as well as the Transkei, are inadequately funded, and cannot provide reliable bus services, resulting in a seriously ageing and dangerous bus fleet.

Members, we must transform interim contracts so that they are in line with our public transport vision and strategy, including regulated competition. Tendered contracts will be the norm, whilst negotiated contracts will be approved only as an exception where we seek to achieve certain specified objectives, which cannot be realised through the tender process.

Provinces wanting to convert the current interim contracts into negotiated contracts, must apply to the Minister, and provide detailed motivations and a business plan for this approach. Such applications will be subjected to serious evaluation and will need to meet the strict criteria that we have set, and they will be negotiated only once for a period of five years.

I must emphasise to my colleagues in provinces and bus operators that there cannot be a blanket approval of negotiated contracts.

In summary, therefore, there is no doubt that our subsidy review process will need to address issues of equity, and the distributional spend of the subsidy across our country. The department has been involved in detailed discussion with the bus industry since November of last year, with the view of finding amicable solutions to all these matters.

Happily, the parties to these discussions do appreciate current realities and challenges, and recognise the urgent need to move forward together. I have also made it very clear to the department that they must conclude these consultations with the industry shortly, so that our next transport Minmec can make a final determination on these bus contracts.

Let me remind the officials and all concerned that we are not prepared to delay any further, because the existing situation has only resulted in uncertainty for the industry as a whole, inability for forward planning, an ageing bus fleet across the country, bus accidents, and serious loss of skills by the industry. And, the workers of the industry itself also need certainty in order to plan their own lives and the future of their children.

There are many challenges facing us as we try to extend public transport services to many of our communities, including objective constraints, such as funding for public transport. But I am inspired by the political commitment shown by many provinces that try to find additional resources to extend these services.

I must take this opportunity to commend provinces such as Mpumalanga and the Eastern Cape for their efforts to generate additional resources within their own budgets, in order to extend services to our people. These resources are insignificant in the broader scheme of things, where demand is so high, but we believe they provide the much needed bus services on new routes that were previously not covered by this national subsidy.

Hon members, I indicated in the National Assembly the details of a roll-out plan for the taxi recap would be available after Cabinet’s approval by the end of June 2005. The taxi recap provides all provinces with an excellent opportunity to strengthen their all-round capacity. The Department of Transport will provide support where the lack of capacity affects our ability to roll-out in a particular province.

However, provinces are still responsible for making provision for the proper funding and capacity of these institutional mechanisms as part of implementing key aspect of the NLTTA. Provinces are also required to undertake at least three specific tasks. They must accelerate the conversion of permits into operating licences within their provinces. Secondly, they must focus on the capacity requirements of current institutions, such as the operating licensing boards and the office of the Registrar. Thirdly, they should work very closely with Santaco and ensure that Santaco’s capacity to discharge its responsibilities fully to the operators on the ground is indeed realised.

Rolling out the taxi recap, in terms of the actual scrapping of the wrecks, or “skorokoro”, you may say, will have to focus on a combination of factors. This will include prioritising areas with the highest number of old vehicles, and those that show a faster rate in the deterioration of their fleet, and assessing the capacity for effective law enforcement, and their immediate access to functioning transport institutions.

The scrapping allowance is no longer defined as a deposit for the purchase of the new taxi vehicles. Those who wish to exit the industry can do so without having to forfeit the scrapping allowance of R50 000. However, the distribution of the current ageing taxi fleet in provinces serves as a reliable indicator of where the R5,2 billion of the R7,7 billion for the scrapping allowance will be spent over the next five to seven years.

For example, the approximately 16 000 registered vehicles, that is vehicles that are linked to permits and operating licences in the Western Cape, will mean that over R800 million of the scrapping will be spent in the Western Cape over this period. Vehicle manufacturers and their related service providers can now plan better and anticipate the demand for new vehicles that need our safety requirements that are going to be issued next month, which is starting tomorrow.

The challenge of stimulating transport in the rural areas of our country remains high on our agenda. The lack of frequent public transport in most of our rural areas does not make any moral, political, or economic sense. I have received representations from provinces about the use of light delivery vans, LDVs, or bakkies, to transport people. Although this practice is indeed outlawed, we must not forget that the almost total absence of reliable public transport in rural areas drives people to use LDVs as an alternative.

Our figures show that if LDVs were taken out of use completely, the poorer resourced provinces would suffer the most. For example, Limpopo would see the average number of people to an available vehicle jump by over 70%. We cannot rely on simplistic solutions to safety problems without understanding the larger picture.

The rural transport strategy is aimed at addressing this legacy. We have allocated resources in this regard, though limited. This limited funding cannot, on its own, deliver transport that is vital to stimulating rural development. Instead, these limited resources should enable us to co- ordinate existing efforts and resources in the rural context. The resources for stimulating rural mobility are there in the SA National Roads Agency, for the construction of access roads, efforts for the revitalisation of branch railway lines, allocations for the subsidy I have spoken about, and the opportunity provided by the 2010 Soccer World Cup.

An effective strategy should enable us to co-ordinate the delivery of infrastructure, stimulate public transport, and enable the rural masses to move their produce and have access to markets. The Millennium Development Goals also provides us with opportunities of addressing some of the major challenges in respect of rural development.

Let me conclude by extending MEC, Jerry Thibedi’s thoughts when he quoted J F Kennedy in his North West budget vote:

It is not our good economy that gave the USA its good roads, but it is our good roads that gave us our good economy.

In our South African situation, perhaps we should say that that sentiment covers the whole of the transport system itself, as the heartbeat of the South African economy. Thank you. [Applause.]

                               RULING

The CHAIRPERSON OF COMMITTEES: Hon members, before we proceed, I want to make a ruling on two points of order that were raised on 24 May, and I promised this House that I would rule on them at the next sitting. The first ruling is that during the debate on Budget Vote No 2, Parliament, the hon Watson made the following remark:

Robert McBride was a murderer and this House cannot condone him as anything else.

Hon Kgoshi Mokoena raised as point of order that the hon Watson should withdraw the statement, since it was a serious allegation. I was the presiding officer at the time and since I was in agreement with the point of order raised by the hon Kgoshi Mokoena, I asked the hon member to withdraw his words. Hon Watson replied that he would not withdraw his words. When the officer presiding has made a ruling, as I had done, and the member to whom the ruling was directed, refuses to abide by the ruling, that is showing contempt for the officer presiding and contempt for proceedings of this hon House, because the officer presiding represents the authority of the House. NCOP Rule 37(1)(b) provides that the officer presiding may order a member to leave the Chamber immediately for the remainder of the day’s sitting, if the officer presiding is of the opinion that the member is in contempt of or is disregarding the authority of the Chair.

On 24 May 2005 I did not invoke the provision of Rule 37(1)(b) but instead indicated that I would provide a ruling at a later stage. It is my ruling that on 24 May 2005 the hon Watson disregarded the authority of the Chair by refusing to withdraw his words after been passed by the officer presiding to do so. Where a member has concerns about a ruling that has been made, the member should raise that matter with the office bearer outside the House, either orally or in writing. The member should not disregard the authority of the Chair by failing to abide by the ruling in the House. That is the first ruling.

The second ruling is that a point of order was raised by the hon A L Moseki during our sitting on 24 May 2005. The hon Moseki raised a point of order on whether it is parliamentary for the hon Terreblanche to say to a member who was on the floor at the time that he was lying. Unfortunately I did not hear the member as I was listening to the speaker who was at the podium. I made an undertaking that I would consult the Hansard and make the necessary ruling. I have requested the Hansard records and I could not pick that up.

However, this may not necessarily mean that a member did not utter the statement as alleged, but rather it once more demonstrates that as members we should resist from engaging in private discussions while members are speaking at the podium, as this makes it difficult for the presiding officers to hear what the speaker is saying and at the same time, to hear any member who may be saying something that is unparliamentary.

I therefore rule that since I neither heard the member, nor picked it up from the Hansard, I cannot make any ruling on the matter. Thank you, hon members.

Mr R J TAU: Hon Chairperson, hon Minister, members, officials from the department, friends and comrades, allow me to dedicate my input today during this Budget Vote to my grandmother and many other veterans of our revolution. In doing so, may I give context to the reason why I want to do that. Over the weekend at home, my grandmother asked me a question related to the work we are doing in Parliament, because everyday when Parliament goes live on television she always watches and listens to the debates in the House.

Based on the observations that she made, she asked me who these people in our Parliament are who keep on attacking the Freedom Charter? Who are these people in our Parliament who keep on referring to our Freedom Charter as a “freedom cheater”? Who are these people in our Parliament who keep on referring to our Freedom Charter as a wishful-thinking document?

She asked me to convey her message to all those people who keep on ridiculing the People’s Charter, that in the first place, it is as a result of the Freedom Charter that today they are able to enjoy the freedom of participating in the Budget Votes in a democratic Parliament. Secondly, it is as a result of the Freedom Charter that today they enjoy a road infrastructure that is capable of ensuring that our economy grows.

Thirdly, it is as a result of the Freedom Charter that today we have a department that aims to establish a national transport system that enables national, provincial and local government to develop an efficient and affordable, fully integrated infrastructure, and services that best meet the needs of transport users and promote economic and social development, while being environmentally and economically sustainable.

It also strives to ensure that there is a sustainable movement of people and goods, locally in the southern development community region and internationally. And by so doing, it aids the participation in the socio- economic activities, because that movement of people and goods is critical to the growth and development of the economy and broadens access to the markets.

My grandmother went further to say that as the ANC we must remind these people that it is as a result of the Freedom Charter that today, after inheriting an unstructured, unsafe taxi industry, the department is in the process of ensuring that her grandchildren and great-grandchildren will enjoy a transformed taxi industry in which our government under the leadership of the Minister has invested a lot, particularly in passenger and rail infrastructure, and appropriately targeting public transport subsidies. Our department has noted the low rate of investment in the transport infrastructure, resulting in an unreliable rail network, and also resulting in reliance by many exporters on more costly road freight and poor conditions in the South African ports. As a result, a freight logistics strategy has been drafted to inform the necessary investment in the infrastructure, and to identify operational improvements to eliminate bottlenecks in the freight logistics system.

The establishment of an independent Port Regulator is also expected to have a positive impact on the efficiency of freight logistics. The department, by continuing to work on integrating and improving the road networks, makes sure it is well developed, maintained and safe. There is an increase in funds for national roads infrastructure and road infrastructure co- ordination.

Representatives of the three spheres of government will develop a road infrastructure development plan through the co-ordinating body to ensure co- ordination in the identification of road upgrading projects. The department in partnership with provinces is revitalising a number of strategic rail branch lines or lanes. In placing its priority on regulating safety and security in the transport sector, priorities are safety in road transport and traffic operations. Similar action has been taken to improve safety in the rail, airport and maritime transport sectors.

Without losing sight of my grandmother’s advice, she also reminded me and asked me to remind those who see the Freedom Charter as another wishful- thinking document, that the department is also engaged in the process of fighting poverty. The department by so doing is promoting infrastructure investment in the transport sector in order to contribute towards job creation and the use of labour-intensive construction methods.

This objective will be co-ordinated through the implementation of the road infrastructure strategic framework. The national overload control strategy and the rural development strategy furthermore broadens BEE strategies and charters for eight of the transport sectors are being developed. Together these objectives will contribute towards economic growth, job creation, skills development and poverty alleviation.

Lest we forget, it is important to note some key areas that the department is engaged in as part of the broad strategy of fighting poverty. There are various road maintenance programmes in all provinces, and these programmes are being used to contribute to the Expanded Public Works Programme. For example, we have the Zenzele Road Maintenance Programme in the Western Cape and the Zibambele Road Maintenance Programme in KwaZulu-Natal.

The Zenzele Road Maintenance Programme in the Western Cape is based on a community-centred, public participation approach, and at the same time it aims to create long-term jobs for community members, decrease unemployment in the community, develop small businesses and uplift the community by providing them with infrastructure. It will also improve the conditions of existing road infrastructure by routine and periodic maintenance. They also educate community members, transferring skills and providing training for the community involved in the programme.

Like the Zenzele programme, the Zibambele Road Maintenance Programme in KwaZulu-Natal also uses labour-intensive methods. While my grandmother was engaging me on all these issues, I also took the liberty to inform her that there are also some challenges that the department is faced with in the process of ensuring that the Freedom Charter is a living document, and which among other things, includes the filling of vacancies, recruitment and the retaining of critical skills in the department.

The delays in the operation of the Road Traffic Management Corporation is as a result of delays in the implementation of the administratively adjudicated road traffic offences system, parity fines and driver retesting after serious convictions. The ongoing financial problems facing the Road Traffic Fund continue to be a problem to the department. There is also a need to address the infrastructure and the output backlogs at ports and to improve the management and the efficiency of ports. And lastly, I said to her that the finalisation and the rolling out of our taxi recapitalisation project will only be allowed in terms of the details the Minister has announced.

She also reminded me of how as a young girl she participated together with other veterans of our movement in the collection of ideas that the people wanted to be captured in the Freedom Charter, and of the fact that she has lived to see those views expressed and happening today.

One of the key areas that she identified was the fact that the budget allocations and expenditures in the Department of Transport reflects a steadily increasing trend for programmes and priorities placed on the transport sector by the government. The development of and investment in the transport infrastructure will further contribute towards economic growth, skills development and poverty alleviation.

Hon Minister, my grandmother asked me to convey a message to you and your department. She said that together with other senior citizens and veterans of our movement they appreciate the sterling work that you are doing together with your department in the process of restructuring the Road Accident Fund. They recognise the Road Accident Fund as part of the comprehensive social security system, as it assist those who are left destitute by road accidents.

She says they have noted the serious challenges that the fund has experienced over many years that in essence have the potential of undermining the objectives that have been set out in the Act governing the fund, which amongst other things include: high settlement costs, delays in settlement, fraud and corruption in the fund, and high liabilities that exceed its assets - which were recorded by the Auditor-General’s report to be over R18 billion in the 2003-04 financial year. There is also the operating loss of R3,1 billion for the year 2004. She said they welcomed the efforts that are currently underway to address some of, if not all, these challenges and issues facing the fund itself.

Key to these efforts are the appreciation of the setting up of the Road Accident Fund Commission in 1999, which submitted its report in 2002, and the other is the tabling in Parliament of the Road Accident Fund Amendment Bill, which is currently being considered by the National Assembly’s Portfolio Committee.

She asked me not to conclude my input without mentioning to our detractors that South Africa is better than yesterday. She says I must say to the DA that gone are the days when it was a nightmare to travel by train, harassed by young, racist security guards or ticket inspectors that would not respect a peaceful journey and where she was subjected to only travelling in third-class coaches, because first and second-class were only meant for white people.

She says that while they acknowledge the challenges that the country faces, they note the progress made thus far, and particularly in transport, because very soon she will be able to wake up in the morning to catch a taxi, and not have to worry about carrying an extra blouse, because the taxi that she will board will in actual fact tear the one that she has on.

Noting that I was driving back to work, she wished me a safe journey back to Cape Town, and reminded me to do the following: to be responsible and obey the rules of the road; and specifically to avoid drinking and driving, speeding, illegal and unsafe overtaking across barrier lanes, and to ensure that my vehicle was roadworthy.

Lastly, Chair, she was pleased when I called her this morning to inform her that in actual fact the Select Committee on Public Services supports the Budget Vote. Thank you very much. [Laughter.] [Applause.]

Mr D A WORTH: Deputy Chairperson, hon Minister and MECs present, a great challenge facing the Minister and the department is the whole aspect of road safety, and the unacceptably high incidence of road deaths. The Department of Transport recently stated that half of South Africa’s 6 million drivers’ licences were fraudulent. This, in effect, means that 3 million persons are driving vehicles illegally on South Africa’s roads, or that every second driver out there is not legitimate. This includes an unknown number of people in charge of extremely dangerous, heavy vehicles. No wonder there are so many accidents with their accompanying horrific consequences, ranging from death and disability to financial hardship.

It was announced with great fanfare in 1998 that the new credit card licence system was supposed to be foolproof and would eliminate most, if not all, fraudulent licences. However, the exact opposite has happened, and it would appear that most of the fraudulent licences have been issued by traffic officials, or personnel employed by the department, who have been bribed. The department has now had to raise some R50 million to investigate every single licence through the Special Investigation Unit. This corruption is indicative of the poor moral and ethical standards being upheld by some in our country.

With this as a starting point, it is then not difficult to understand why there are so many unroadworthy vehicles on our roads today. It is a figment of the imagination to think that a motorist with a fake licence will bother to maintain his vehicle in a roadworthy condition, let alone worry about drinking and driving.

With so many corrupt officials, it just depends on which document has the greatest value, a false ID, a passport or drivers’ licence – they are all available at the right price.

South Africa has an unacceptably high accident rate and a culture of safe driving must be entrenched through a combination of education, zero tolerance and higher driver testing and enforcement standards. The false drivers’ licences, of course, will also have an influence on banks and insurance companies that could lay charges of fraud against such drivers because of past claims paid out based on false licences.

The Road Accident Fund, RAF, which was racked with corruption itself to the tune of R500 million a year, must also be adversely affected with a claims backlog of some 347 000 cases - and continues to receive 160 000 new claims every year. The fund also needs to be restructured and transformed, and the DA trusts that the proposed overhaul by the Minister will have the desired effect. A reduction in accidents will mean a reduction in claims and better road safety.

Our national road network is also deteriorating fast. Some 745 million tons of goods were imported or exported last year. The mining, manufacturing and agricultural sectors accounted for the bulk of this. Total transport costs were R135 billion. The biggest portion was spent on road haulage and only a minimal amount was spent on rail transport.

The Free State, my home province, because of its central situation has all the heavy vehicles passing through and the budget statement for 2005-06 states: The average condition of the road network in the Free State is deteriorating rapidly, and without drastic financial investment it will be difficult to reverse this trend. The percentage of poor and very poor paved roads has increased dramatically since 1991, from 25% to 67% in

1. The percentage decreased slightly to 63% in 2002. The main reason for this decrease is due to the 815 kilometres of road taken over by Sanral. The programme only receives approximately R366 million per annum, whilst the minimum needed to address the backlog over a period of 10 years, is R2 billion per year.

Whilst the SA National Roads Agency Ltd, Sanral, with its limited resources are doing a fantastic job on our national road network, its resources are diminishing. Deferred maintenance on roads, due to budget constraints, pushes the rehabilitation costs up, some say to 16 times higher than routine maintenance.

The DA has always advocated, as the Minister would probably have heard in the National Assembly, a dedicated road fund which would be funded from a portion of the fuel levy, and this money should then be allocated to the provinces on a proportional basis to be used solely for road maintenance; a user-pay system.

The challenge is to bring down the cost of transporting goods by rail. The transport infrastructure is critical to South Africa’s competitiveness. The consequences for economic development, exports and job creation are significant. Only by having a cost-effective, efficient and timely rail service will the damage to our road infrastructure be reduced in the long term, and have a significant impact on the accident rate. I thank you.

Mr M SKWATSHA (Western Cape): Hon Chairperson, hon Minister, comrades, it is a pleasure to be standing here today on 31 May, a day, very many years ago, on which some tiny, racist minority in our country decided to declare it a republic. Of course that was before the people had spoken and chosen which days would be holidays. Today 31 May is a normal day, and we are happy to be addressing this House and coming in support of the budget of our national Minister today.

The national Minister in his budget speech announced that his department would be focusing on seven priority areas, which include public transport, freight, logistics, rural development and integration and safety and security. I want to briefly address how my department has responded and will continue to respond to each of these priorities in public transport.

In order to face the broader challenges within public transport on a national level, two major projects stand out, namely, passenger rail consolidation and the taxi recap programme. Rail transport in the Western Cape and in the city of Cape Town has been experiencing a relative decline in patronage over the last few years. Our department is working with various stakeholders to ensure that rail infrastructure is improved to allow for universal accessibility and increased levels of safety.

In the month that starts tomorrow, we will launch our public transport implementation programme, which is a bold series of interdependent and mutually reinforcing strategies and plans aimed at making public transport more affordable to users; ensuring that public transport contributes to iKapa Elihlumayo by reducing the cost of doing business; building social capital and supporting sustainable development; paving the way for the transition from the interim bus contract with Golden Arrow Bus Services to tendered and/or negotiated contracts and preparing for holding World Cup 2010.

The different elements making up the public transport improvement programme include the following: The restructuring of bus contracts to introduce other operators into the subsidised system, which the Minister has so eloquently spoken about and referred to here. Those others will include minibus taxis and small bus operators. The reform of the subsidy system will target the elderly, learners, persons with disabilities and the unemployed; and allow for subsidisation of rural services; the integration of all modes of transport are to provide a similar service, the reduction of costs to be passed on users and improved efficiency.

The establishment of a transport authority to plan for and manage the public transport system has a province-wide responsibility and must be governed with representation from the department of transport, the province, the city of Cape Town, other municipalities, organised labour, civil society and business. Public transport infrastructure along key mobility corridors must be upgraded, with increased attention to nonmotorised transport and public transport facilities to promote service integration.

The Public Transport Improvement Programme, PTIP, builds on work already being undertaken in our department. Mobility strategies for the Klipfontein corridor, for the Central Karoo corridor and the George mobility strategy have already been launched. Mobility strategies for Mossel Bay and the West Coast are to follow soon. The designs for dignified urban spaces and nonmotorised transport infrastructure for the Klipfontein road mobility strategy have been completed and are in the implementation phase.

The design of the road infrastructure and operation system will be finalised and a phased implementation will take place. An amount of R40 million has been allocated for this project in this current financial year. Public transport services for Klipfontein will be put out to tender before the end of this calendar year.

I am pleased that the national department is going to present the rural transport strategy framework for comment and implementation next month. This will certainly assist in developing our mobility strategies outside the Cape Town metropole. The Central Karoo strategy was launched in February this year, and R3 million is being spent on pedestrian and cycle paths along both sides of Mandlenkosi Road in Beaufort West.

The viability of multipurpose brokerage services, as well as the infrastructure to support this initiative, is being investigated. A preliminary design and costing of a scheduled subsidised public transport system will be included in this strategy. This will support accessibility and mobility for the outlying communities of Merweville and Murraysburg, which are far removed from all the basic amenities.

The George mobility strategy was launched in August last year by the Deputy President, and involves the upgrading of public transport corridors between the communities of Thembalethu and Pacaltsdorp with downtown George, which will also help in integrating our communities.

The detailed design of this project has been completed. An amount of R7 million has been allocated for the project in this financial year. Our department has allocated a total of R58,7 million for mobility strategies and nonmotorised transport infrastructure and R40,9 million for public transport facilities within municipalities. The projects will be implemented through the Expanded Public Works Programme in order to promote skills development and job creation. Further funding has been made available to assist the six district municipalities and the City of Cape Town in the development of their public transport and integrated transport plans.

Technical support and guidance is also provided when needed. The extreme lack of resources in these municipalities is cause for concern and the partnership with our sister department of local government and housing is beginning to assist in addressing this situation.

As the taxi recap project has become a reality and the safety requirements for the new vehicles are to be published as regulations next month, our department has responded by taking the following actions: In October last year, a special team was appointed to deal with the backlog of applications for operating licences with the intention that by August 2005 the backlog would have been cleared. Eighty per cent of existing permits have already been converted to operating licences, and we intend to meet the national deadline at the end of August in preparation for recap.

The Soccer World Cup 2010 is an important event, and we will require an efficient public transport system. Upgraded minibus taxis, buses and rail services will form the backbone of the Soccer World Cup spectator transport and will create a lasting legacy of significant public transport improvements. The department will be partnering with the city of Cape Town to ensure that such upgrades are undertaken to affect an integrated and efficient system. One such element is the need to provide a link between the Cape Town CBD and the airport. In furtherance of this, our department will be working with the Department of Economic Development, the Airports Company of SA, the SA Rail Commuter Corporation and the City of Cape Town to undertake a complete feasibility study, which will include market research of the customer base and their needs. The provision of a reliable and efficient public transport service, especially for tourists, will help in ensuring that Cape Town and the Western Cape is the lead tourist destination in South Africa - we want to beat Gauteng and KZN in this regard! [Laughter.]

Once again I want to agree with the Minister when he quotes both MEC Thibedi and JFK: “The economy does not build roads, but roads built the economy”. This is very true and evident in the Western Cape. I can say with pride that my department’s roads and infrastructure branch has spent its budget in full, which means that R780 million was virtually pumped into our economy. [Time expired.] [Applause.]

Mr N MACK: Hon Chairperson, hon Minister, MECs, hon members of the NCOP, distinguished guests, comrades and friends, the late Dullah Omar, our comrade upon whom the Order of Luthuli was bestowed when presenting his Department of Transport business plan for the financial year 2002-03 said:

Transport is a basic necessity in addressing poverty and development needs, particularly in the rural areas and the department will continue to be faced with the challenges of improving the quality of life of individuals and to contribute to sustainable growth of the economy.

The Minister of Transport, Minister Jeff Radebe, in his address to the International Transport Convention 2005 in Limpopo province correctly and without doubt said:

Africa’s transport infrastructure is diverse and uneven in its spread and it is clear that there is some overlap in the manner in which transport infrastructure is dispersed and the manner in which electricity, sanitation, education and health facilities impact on our daily lives.

During November 2004 at the UITP Conference in Benoni the Director-General of Transport also correctly and without doubt highlighted very important aspects that we as the leaders of this country should be aware of and find ways and means to address. He emphasised that the inequalities and settlement patterns that apartheid policies brought about still loom large and we are still paying for them and that the transport legacy of apartheid is one of spatial dislocation.

The DA’s entire policies and thinking said to the entire world at the recent Presidency Budget Vote debate that the Freedom Charter is not the nation’s document. I therefore assume that the ideal that, “There shall be houses, security and comfort” is not on the DA’s agenda. [Interjections.] These unbelievable and inhumane statements of the DA are definitely not welcome in the homes of the poorest of the poor who are the ones who should be the priority sector of a community.

President Thabo Mbeki, in his reply to the Budget Vote debate, challenges us as leaders of this country on the issue of unity in diversity. This issue is in fact an issue that is not limited to race or culture, but an issue that also reflects on our entire way of living, such as transportation, housing, the economy, etc.

Let me say to the DA, and whoever does not believe in the Freedom Charter, that there will never and never again be a first class, so-called whites only, and a third class, so-called nonwhites only. Let me furthermore say to the DA, and whoever does not accept the Freedom Charter, that there will never again be a railway line that separates the so-called whites and the so-called nonwhites.

With regard to road maintenance, approximately 1 350 km of national roads are being upgraded and maintained. The Road Infrastructure Strategic Framework is being developed by the Department of Transport and will give effect to the national vision of road transport in South Africa.

In line with the resolution of the Growth and Development Summit held in 2003, government has embarked on a new initiative to integrate labour- intensive road construction programmes. It is hoped that road maintenance will contribute to government’s objectives of job creation and poverty alleviation through the Expanded Public Works Programme.

Road traffic law enforcement on South Africa’s roads is not effective in curbing the continuing, generally high level of lawlessness and increasing number of road traffic crises resulting in fatalities and injuries. Road accidents claim nearly 10 000 lives every year. These road accidents are costly, not only in terms of lives, but also economically and socially. There are a number of factors that contribute to an increase in the high fatalities on the roads, these include drinking and driving, speeding, illegal and unsafe overtaking and unroadworthy vehicles.

As a result government has adopted a number of measures aimed at improving road safety. Road safety forms part of government’s objective to improve safety on all modes of transport. The number of institutional mechanisms that government has instituted to deal with road safety are: The constitutional obligations in terms of schedules 4 and 5 of the Constitution of South Africa that provides for national, provincial and local government legislative competencies around functional area that include road traffic management, the Arrive Alive Campaign and much more.

What does transport mean to the deep rural farmworkers in the deep rural Karoo where white farmers take their Land Rovers and drive to town with the farmworkers on the back of that bakkie? They take them to a certain shop that they prefer, refusing us access to them. When we attempt to talk to these farmworkers they are herded off and you cannot speak them. Now farm owners do not bring these people into town any more. They buy the foodstuffs and take them to their farms where they have their own little shops from which they sell the goods to these people at increased prices.

They don’t allow you on that farm, and they are not willing to bring our people in for registration, ID documents and for births. But when elections come they bring in the farmworkers, but they are herded like goats to vote for a certain party. [Interjections.]

Surely this is a contravention of our Constitution, because this restricts free movement and I think we need to challenge this. This is why we in the Central Karoo thank our MEC because he has already started and has put much of his energy into these matters. We need the national department and Minister to support us, especially with this problem. I thank you. [Applause]

Mr F ADAMS: Hon Chairperson, hon Minister, colleagues and MECs . . .

. . . openbare vervoer gaan nie net oor busse, treine en taxi’s nie. Openbare vervoer word gedryf deur die nood van mense om na hul werk, skool, ’n hospitaal, kliniek, of êrens heen te gaan; en hulle is afhanklik daarvan.

Weens die beleid van die vorige regering is die mense ver van hul werkplek, sosiale plek of skool verwyder. Daarom is dit partykeer vir baie mense onmoontlik, weens die hoë vervoerkoste in dorpe en in stede, om by hul plekke uit te kom.

Op ’n ligter noot wil ek net vir die agb Tau sê, hy praat van sy ouma - ek hoop as sy ouma ry kyk sy uit vir die DA-“spietkops”, want hulle is maar baie “foolish”.

Dit is verblywend om te sien dat die departement, die Minister en die provinsiale ministers alles in hul vermoë doen om ons vervoerstelsel op datum te bring. Omdat Suid-Afrika nie net in Afrika kompeteer nie, maar omdat Suid-Afrika ook internasionaal in die wêreld kompeteer, kry ons baie meer mededing van die wêreld. Daarom is dié departement een van die sleuteldepartemente in ons land, weens, soos ander sprekers gesê het, werkskepping, armoede verligting en baie ander dinge.

Daarom wil ons ons dank en waardering uitspreek teenoor die Minister, sy amptenary, en spesifiek vir mnr Lucky Montana wat altyd so vir hierdie komitee, Minister, op ’n gereelde grondslag, kom verduidelik, én saam met ons die pad stap om alles vir ons duidelik te maak.

Ook vir u en u departement wil ons sterkte toewens. Dis ’n harde pad, Minister; Rome is nie in een dag gebou nie. Die DA dink dat Rome wel gebou in een dag is. Ek wil hê hulle moet teruggaan na die geskiedenis en gaan kyk. (Translation of Afrikaans paragraphs follows.)

[ … public transport is not only about buses, trains and taxis. Public transport is driven by the need of people to go to work, school, a hospital, clinic or somewhere, and they are dependent on it.

Because of the policy of the previous government people are far from their places of work, social places or schools. For this reason it is often impossible for many people to reach their places because of the high cost of transport in towns and cities.

In a lighter vein, I just want to say to the hon Tau, he talks about his grandmother - I hope that when his grandmother is driving, she is on the lookout for the DA “speedcops”, because they really are quite foolish.

It is heartening to see that the department, the Minister and the provincial ministers are doing everything in their power to bring our transport system up to date. Because South Africa does not compete in Africa only, but also internationally, we get much more competition from the outside world. For this reason this department is one of the key departments in our country, because of job creation, poverty relief and many other things, as other speakers have said.

For this reason we want to convey our thanks and appreciation to the Minister, his officials, and in particular Mr Lucky Montana, who always comes to explain things to this committee on a regular basis, Minister, and travels the road with us to make everything clear to us.

We also want to wish you and your department everything of the best. It is a hard road, Minister; Rome was not built in a day. The DA thinks that Rome was in fact built in a day. I want them to go back and look at history.]

Rome wasn’t built in one day.

Jy kry nie ’n kitsbaba nie. Ek weet nie in watter wêreld hulle leef waar jy kitsbabas kry nie. ’n Baba moet gebore word; hy moet leer kruip; hy moet groei; hy moet leer loop, en dit is wat ons jong demokrasie besig is om te doen. Ons jong demokrasie is in ’n baie ver gevorderde stadium. Ons jong demokrasie is die toonaangewende demokrasie vir Afrika. En ek weet nie in watter land ons agb Thetjeng bly nie, maar ek wil vir hom sê: Welkom in Suid-Afrika waar dinge aan die gebeur is; welkom in Suid-Afrika waar die regering werklik ’n verskil aan mense se lewens maak; waar die regering werklik armoede wil beveg; waar die regering werklik vir ons mense wat sonder werk sit, wil werk gee, kos op die tafel sit, en, soos die slagspreuk lui, vir almal ’n beter lewe wil gee.

Daar’s ’n kontrak gesluit met die mense van Suid-Afrika; 70% van die stemgeregtiges van Suid-Afrika het ’n kontrak met die regering gesluit, en gesê: Ons soek ’n beter lewe, nie ’n alternatiewe regering soos die DA nie, maar ’n beter lewe onder die huidige regering. Die NNP steun dié Begrotingspos. Ek dank u. [Applous.] (Translation of Afrikaans paragraphs follows.)

[One does not get an instant baby. I do not know in which world they are living where one gets instant babies. A baby must be born; he must learn to crawl; he must grow; he must learn to walk, and this is what our young democracy is busy doing. Our young democracy is in a very advanced stage. Our young democracy is the leading democracy for Africa. And I do not know in which country our hon Thetjeng lives, but I want to say to him: Welcome to South Africa where things are happening; welcome to South Africa where the government actually makes a difference to people’s lives; where the government really wants to fight poverty; where the government really wants to give jobs to our people who are unemployed; wants to put food on the table, and, as the saying goes, wants to give everyone a better life.

A contract has been concluded with the people of South Africa; 70% of those who are enfranchised have concluded a contract with the government and said: We are looking for a better life, not an alternative government like the DA, but a better life under the present government. The NNP supports this Budget Vote. I thank you. [Applause.]]

Mnu M A MZIZI: Ngqongqoshe kazwelonke nongqongqoshe abakhona phakathi kweNdlu, bozakwethu, ngisaphinda ngithi: unwele olude. [Mr M A MZIZI: Minister and MECs present in this House as well as my colleagues, I want to repeat: Long live!]

Chairperson, transport is a necessity for every person, which takes one from point A to point B. Transport should conform to the requirements. It is a known fact that a lot has been done regarding transport in the country.

Ngeke sikuphikise lokho, kuningi kakhulu. Kodwa singasho singananazi ukuthi izithuthi uhulumeni azinakile ngezihamba ngamasondo namafutha – nakhona ezindaweni ezingamadolobha kuphela, nalapho kukhona imigwaqo khona.

Ngqongqoshe, ngakube lesi sabiwomali sizokwazi yini ukuhlinzekela nezindawo lapho kungekho khona imigwaqo nezithuthi ezihamba ngamafutha? Ukuze wonke umuntu ahlomule kulo mnotho waleli lizwe, bekungakuhle ukuba izinjomane zisetshenziswe ukudonsa izinqola kulezo zindawo lapho kungekho khona imigwaqo yetiyela.

Uma sibuka isabiwomali salo nyaka nonyaka ozayo, ukhona umbuzo othi, “Ngakube sizokwazi ukuhlangabezana nezimo zonke ezibhekene nezokuthutha, ngisho phela uhlelo lwe-recapitalisation”? Lolu hlelo lwe-recapitalisation ngenye yemikhakha okungahle kusetshenziswe kuyo imali eningi uma wonke umuntu onesithuthi esidala enikela ngaso. Ngqongqoshe, ngakube umnyango wakho uzokwazi yini ukukufeza lokho na?

Lo mthombo wogobhoza njalo ukuze kwenele wonke umuntu waleli na? Ngisho phela maqondana naleyo mali eyi-R50 000 ezonikezwa labo abazobe benikele ngezithuthi. Ngakube isabiwomali sizokwazi yini ukubhekana naleso simo ngoba wonke umuntu uzoletha isigodongonyana sakhe afike asilahle laphaya bese ecosha lokho akucoshayo? I-IFP iyokushayela ihlombe uma uhulumeni engake alubuyekeze lolu daba lwe-recapitalisation ukuze wonke umuntu wakuleli abe sethubeni elilingana nelabanye. (Translation of isiZulu paragraphs follows.)

[We cannot dispute that there are many issues. We can say without hesitation that the government is concerned about vehicles using petrol and oil in towns where there are roads.

Will the budget presented by the Minister be able to provide even places without roads and transport? All people have to benefit from the economy of this country. It will be advisable to use horse-drawn carts in places without tarred roads.

The question might arise, when one looks at the budget for this year and next year, whether it will be able to meet transportation needs. I am referring to the recapitalisation programme. The recapitalisation programme would require more money if everyone owning an old vehicle surrendered it. Will your department, Minister, be in a position to pay that?

Would this amount remain available to everyone in this country? I am referring to the R50 000 that would be given to those surrendering their vehicles. Will this budget be able to meet these demands because everyone would want to surrender their old vehicles and get something for them? The IFP would welcome the government revisiting the recapitalisation process so that everyone is on the same level as others.]

This issue is characterised by too many protests and violence in the taxi industry in some provinces.

Akungabazeki lokho Ngqongqoshe ngoba uma sikhuluma nabantu emazingeni aphansi, yima kungathi kuyantwela kubo. Yikhona bezwa ukuthi, hhayi bo, udaba lwe-recapitalisation alusahlehli, seluyinkunzi ayihlehli, luya phambili. Yilowo nalowo muntu useyaxhamazela ngoba sekuyabonakala ukuthi isikhathi siyemuka, abantu abezukuba nazo izimoto.

Okunye futhi ukuthi namhlanje amasela antshontsha imoto manje ayifake ngale kwamakhelwane, iphume seyingenye into, bakulayishe ngayo. Bantshontsha ngisho ubisi etiyeni lomuntu, ujike ungaboni ukuthi itiye alisenalo ubisi. [Uhleko.] I-IFP iyasixhasa nokho lesi sabiwomali. (Translation of isiZulu paragraphs follows.)

[It is now dawning on many people at the lower levels, Minister, that when we talk to them, they realise that the recapitalisation programme is here to stay; there is no turning back. Everyone is in a hurry now as they realise that time is against them. They will be without vehicles.

Theft of vehicles is another issue. Car thieves steal your car and take it to your neighbour. When it comes out it is a completely new car and you would get into it without noticing. They could steal milk from one’s tea without one noticing that the tea is now without milk. [Laughter.] The IFP, however, supports this budget.]

Mr S J MOHAI (Free State): Chairperson, hon Minister of Transport, Mr Jeff Radebe, colleagues from other provinces, hon members and comrades, until the vision of liberation of the Freedom Charter is fully attained, the work of the freedom loving South Africans will continue unabated. We must urgently and resolutely discharge our responsibilities in building a full- fledged, nonracial, nonsexist, democratic, prosperous and egalitarian South Africa as envisioned in the Freedom Charter.

The celebration of the 50th anniversary of the Freedom Charter this year is therefore a momentous occasion. We therefore accordingly recommit ourselves to the people’s contract to create work and fight poverty. The practical steps that are being implemented in this first five years of the second decade of freedom include growing the economy, sustainable livelihoods, access to basic services, comprehensive social security and fighting crime and corruption. The transport system we are building in South Africa has an important role in growing and developing our economy in a manner that will benefit the vast majority of our people. This noble exercise of building a public transport system that is effective, accessible, and affordable should therefore be located within the broad, national effort of realising the vision of the Freedom Charter.

In welcoming and endorsing the transport Budget Vote as tabled by Minister Radebe, we will take advantage of this platform and reflect on the work we pursue and the challenges that confront us on this front in the Free State province.

The development of an integrated and sustainable transport system and a well-maintained road network is critical for our province, given its geographic location at the centre of our country.

Three of the country’s national highways, that is, the N1, N2 and N3, which pass through the Free State provide for strong spatial linkages with the rest of South Africa. Some of the main railway lines linking the Eastern and Western Cape and Gauteng provinces run through the Free State.

Given the rural set up of our province, we are paying strategic attention to the whole question of rural transport. In this regard, a pre-study on rural mobility will soon be completed. The study will give direction for more intensified investigations and eventually implementation of measures to improve mobility of rural areas that are currently not well served by transport services.

We have completed planning and a conceptual design of a multimodal facility to be situated in Bloemfontein. This project is planned to integrate the buses, minibus taxis and long distance rail by means of a modern, convenient interchange facility.

This facility will have a significant impact on the quality of public transport services, and would assist with urban renewal of the area of Bloemfontein. The estimated cost of the facility will be R50 million, and various initiatives have been launched to endeavour to obtain the required funding for the project to proceed.

A high-standard, intermodal facility is essential if passenger transport services are to be improved. And it is also important to ensure that the Free State province is able effectively to participate in the 2010 Soccer World Cup.

Undoubtedly, the taxi recapitalisation process will be one of the major activities for the department and the taxi industry. We must be steadfast in working to realise the overall goal of the taxi recapitalisation process as stated by the Minister, which is the replacement of the current ageing fleet that constitutes the bulk of the taxi industry, with new vehicles that are safe and reliable.

Through this process, we also must build the sustainability of the industry both as a public service provider and a business, as well as ensuring its formalisation and effective regulation.

The department in the province has started earnestly with the preparations for the implementation plan for the recap process. Our starting point in this resort was consultative meetings that were held with the provincial taxi council, municipalities and other relevant stakeholders.

Unity and peace in the industry are the key principles. In pursuit of these principles we have since embarked on a programme of amalgamating local associations along the principle of one town, one association, one taxi rank. We have also initiated a process of converting the taxi permits to operator licences. The implementation of the route-based operator licences will ensure that we accelerate service delivery even to the most remote areas.

We are working very hard to conclude, in this financial year no later than the coming December, the transformation of two main subsidised bus companies in the province. These are the Maluti Bus Service based in the Thabo Mufutsanyana District and the Interstate Bus Line based in the Motheo District. This transformation will make provision for broad-based economic inclusion in the contracts in order to encourage economic growth in the transport industry.

With regard to traffic management, work has begun in earnest, to strengthen education, communication and law enforcement both as independent and interdependent components of our traffic management programme. We have therefore started to implement a comprehensive plan that clearly articulates the Arrive Alive Campaign as a constant, year-long campaign.

We are in the process of recruiting 180 traffic officers as part of building our capacity and presence on our roads, so as to reduce accidents. The backlogs of long waiting periods in our testing centres are going to be drastically reduced by the end of July this year.

It is also pleasing to note that during the past festive season we succeeded in reducing fatal accidents on our roads by 2,2% compared to the previous year; notwithstanding the fact that the number of registered vehicles increased by approximately 6%.

The state of the road networks in the province is generally in poor condition and has deteriorated so much that many disadvantaged communities lack the provision of adequate access to roads and internal connector streets. We have huge backlogs with regards to maintenance and construction of roads.

In this regard the department is currently developing a comprehensive maintenance plan so that we can make more convincing and credible arguments for increased funding for road maintenance and construction in the forthcoming fiscal year.

Despite this situation, our own province has provided R289 million and R340 million from Sanral in our roads infrastructure, which should be seen as useful strategic interventions in tackling the backlog and should always be utilised optimally.

In this financial year, we will attempt to substantially increase our BEE investment in roadworks and construction, broadly. A number of road infrastructure projects will be designed for future construction, and some road projects will be executed in this financial year and overlap into the next one.

The initiatives of construction and maintenance of roads have begun to embrace the Expanded Public Works Programme philosophy of labour-intensive, SMME development and skills development. This is the trajectory we will intensify in this financial year and beyond.

As a department, we are going to lead the promotion and, implementation of the principle of corridor development and, where possible, we will ensure the development of our main transport corridors in support of economic growth. This we will do as part of implementing the recently launched provincial growth and development strategy. We will work tirelessly to put transport planning at the centre of our development programme. I thank you, Chair.

Ms F H MATLANYANE: Chairperson, hon Minister, hon members, comrades and compatriots, allow me to inform you that we in the ANC support the Minister’s Budget Vote.

The people of South Africa, when asked which party they would like to govern the country, overwhelmingly said the ANC, because since 1994 the department has been engaged in the difficult task of transforming and trying to improve the living conditions of the people who are living in the rural areas in our country.

Since its formation the ANC has been the champion of fighting for all the people of South Africa to be equal. In South Africa transport is affected by disparities arising from the previous patterns of spatial development; where the poor, the unemployed and the vulnerable could not access it as they travelled long distances in order to access service delivery, and to participate in economic activities. This led to them having to dip deeply into their pockets.

One of the national Department of Transport’s strategic objectives is to restructure public transport subsidies to better target poorer communities, and to align subsidised transport services to support municipal integrated transport plans. This is in line with government’s commitment that transport infrastructure is a critical need between the first and the second economies. This will lead to the mobility of the poor and ensure that they access opportunities created in the wider economy.

The department is currently involved in discussions with the bus industry, organised labour and the provinces with the view to optimise the subsidy allocated to the bus industry, to promote efficiency and facilitate the implementation of broad-based Black Economic Empowerment.

The current bus contracts will be transformed into public transport contracts in order to allow access by taxi industries to the funds allocated for the provision of public transport. This process will see subsidies being shifted towards the poorer households and regions of our country.

A review and redesign of existing services provided by the bus industry will take place. Bus services will be extended to some of the new areas of our country for improved service delivery and integration of our public transport modes. This will enable mobility for the poor so that they can access opportunities created in the wider economy.

Public transport subsidy management receives the largest portion from the allocation under Programme 6, with an increase of 12,6%. The bus industry receives the largest portion of public transport subsidies, whereas the taxi industry is the dominant mode of transport used by 68% of commuters. This says that the current subsidy system is not aligned with the usage of public transport by the majority of South Africans.

The government recognises that the taxi industry plays a strategic role in the economy and in society. Until now, the taxi industry has remained self- regulating. There are a number of reasons why government needs to formalise and regulate the taxi industry in South Africa. Primary among these is the need for safety and reliability in the industry.

The majority of commuters use taxis as their preferred mode of transport. It is apparent that something has to be done to address the skewed allocation of subsidies targeted at public transportation systems in South Africa. This shows that there is a need to restructure the public transport subsidies system, hon Minister.

The Taxi Recapitalisation Programme forms part of an initiative by the government to formalise the minibus taxi industry. This project needs to be seen within the context of an integrated, intermodal transport system that would enhance customer’s convenience, service credibility and safety.

The government has committed itself to putting in place the necessary infrastructure and proceeds with the roll-out of the taxi recapitalisation programme in the second half of the 2005, as the Minister has indicated. The department has also focused on developing the necessary mechanisms for the scrapping of all old vehicles. It intends to put in place mechanisms for physical scrapping allowances to operators in July 2005.

The implementation of the programme will be phased in over seven years, at a total cost R7,7 billion. The 2005 budget allocation towards this is R250 million for 2005-06, and is expected to increase to R290 million in 2007-

1. The aim is to use a portion of funds allocated for 2005-06 towards the final planning and systems development, whilst the rest will be used for a scrapping allocation to taxi owners who scrap their own vehicles. The recapitalisation is to be finalised by the country’s leading banks through an initiative negotiated by Santaco, involving Absa, Nedbank, Standard Bank and Wesbank.

The key objectives of the Taxi Recapitalisation Programme are: The replacement of the current ageing fleet with new vehicles that are safe and reliable, in the form of a once-off payment of R50 000 per scrapped vehicle to a legal operator or registered minibus taxi. This is going to be rolled out over five years to ensure affordability to the national fiscus. To ensure sustainability of the taxi industry as a business, government is going to introduce thresholds for seating capacities, which will be informed by the needs of a particular route.

To formalise and effectively regulate the taxi industry, as opposed to the current self-regulation by the industry, government will sustain the formalisation and registration of the taxi industry across the province. This indicates that as the ANC-led government we will do all in our power to ensure that “all shall be free to travel without restrictions” - that is a quote taken from the Freedom Charter; and that “all privately owned passenger transport must be effectively regulated and controlled” – that is a quote taken from the RDP document - to ensure that the lives of all the people of South Africa are better. We, as the ANC, support the Budget Vote. [Applause.]

Mr T MHLAHLO.(Eastern Cape): Hon Chair, Minister and members, I also stand to report to this House that after the strategic session of the department, we have been able to reposition ourselves in the Eastern Cape. The department of transport in the province has been positioned as a central force in the strategy to develop our growth and development for the province.

Through its “Moving Back to Rail” concept, which has potential to ease our public transport in this province, we have today been in a position to put in place clear strategies for the realisation of rail, as well as public transport. The executive council in the province has endorsed the Kei Rail Development Corridor, which is viewed as a major contributor to the realisation our economic strategy especially for the region of the former Transkei. Kei Rail is an anchor project in this corridor. The project is currently in Phase 3, which involves refurbishment of the existing railway line and associated facilities.

Secondly, the construction of appropriate communication and train control systems, as well as conducting surveys relating to travel demands, estimation and preference of commuters is envisaged. The construction of a shorter link road between Ugie and Langeni Forest near Mthatha to improve accessibility of people, and products such as timber and agricultural products, to markets for which this rail is going to be crucial in moving these kinds of products is in the pipeline. These are some of the concrete interventions we have actually made in our strategy concerning the Moving Back to Rail policy.

An amount of R102 million has been spent on this project since its inception. The department of transport in the province has budgeted R48 million for this financial year so that we can further propel our efforts for the quicker realisation of this line.

The provincial government has awarded a tender to Arcus Gibb Consortium to prepare an economic indaba to be held this year or early next year. This indaba is going to be a platform where a number of investors will be able to stand, because the rail corridor has become a strategic centre in both our economic development plan.

To further enhance our strategy for restructuring the bus industry, as it was indicated by the Minster, another critical element of our public transport system is that we are in a process of establishing a single, legal entity for all small bus operators in the area of Transkei in the Eastern Cape. This is in line with the review of the entire public transport subsidy policy which government is currently pursuing.

The process is on track and it is enjoying support from role-players, in particular the bus operators. Some bus operators have already joined 120 candidates in our training programme which started recently, aimed at empowering bus taxi owners with skills in business planning, financial planning, as well as procedures and health and safety systems.

About 166 routes have already been identified in the former Transkei region to be serviced by this single legal entity. A tender has been awarded to Price Waterhouse Coopers to assist in the establishment and actual consolidation of this entity. Soon we will sign a contract with a mentor management agent and monitoring firm, because we want this new approach to work and to be highly monitored in the province. On Thursday this week the department of transport in the province will be hosting a consultative meeting with about 300 bus operators to explain the role of this new legal entity, so that we can all operate with the same understanding, as we are getting ready to launch this new organisation.

With regard to the recapitalisation of the taxi industry, we will continue with our capacity building programme for taxi drivers. More than 200 minibus taxi drivers, as well as owners and rank marshals have received training on generic business administration, customer care and defensive driving. The department is currently engaging all those who stand to gain by the taxi recapitalisation project to assist in building the industry’s capacity through training.

We have established the Operating Licence Board and it is presently focusing on the whole conversion of permits as required by the taxi recapitalisation project. We have made great strides with regard to the improvement of usage of Bisho, as well as in particular the Mthatha Airport. Today the Mthatha Airport is fully functional and it is now complying with Civil Aviation Authority safety standards. It has since actually seen a 24% increase in its passenger flow. Plans are also in place to look into the possibility of broadening the Mthatha Airport runway so that we can receive bigger aircraft in the future. The department is also in the process of restructuring the two airports in terms of private-public partnership concepts, including the appointment of a transactional advisor and a private operator or manager. All these endeavours seek to make further, visible advances towards the transformation of the transport sector in the province, the realisation of the Reconstruction and Development Programme and meeting the targets of Eastern Cape Growth and Development Plan.

In closing, I also want to say to hon Tau that the instructions that came from his grandmother will be understood in the Eastern Cape, because those instructions are emerging from the instructive policies of the Freedom Charter. The Department of Transport, Cabinet has resolved, must become a central point in our growth and development strategy. And currently, we are preparing for an indaba conference, which is a wonderful opportunity, so that those who could benefit from opportunities, which we have unlocked through the Kei Corridor node, will then be able to come together and actually start to realise that rail as an asset in that province. It is the only available resource that we could use to generate and reposition government’s growth and development strategy. I therefore hope that the present members of this House - when the time comes, we will invite them - can also participate in this conference, because if we cannot innovative in using the inherited assets from the previous government, then we shall have failed to fulfil the mandates which the hon Tau’s grandmother articulated this morning.

So, with those few words I really want to say that the leadership that we have been provided with and the repositioning of transport in this country, has opened up great opportunities for us, and space to be creative in putting together dreams so that those dreams can be realised in our lifetime. With those few words, thank you very much. [Applause.]

Mr O M THETJENG: Chairperson, Minister, colleagues and other guests that are here today, let me just remind members that I have been talking about the Freedom Charter. Perhaps they don’t know what it is. The Freedom Charter is a manifesto of the ANC. South Africans will never celebrate it, but they will celebrate the Constitution of this country. You have got full rights to talk about your own manifestos, but Parliament and other structures will celebrate the Constitution of this country. I just want to make it very clear.

The 2010 Soccer World Cup provides the South Africans with big challenges for … [Interjections.]

The CHIEF WHIP OF THE COUNCIL: Chairperson, on a point of order: It is not allowed to mislead the House. If I remember well, at some point the Minister in the Presidency the hon Essop Pahad was here. He offered through Mr Freddy Adams, that Mr Thetjeng be given a copy of the document of the Congress of the People, the Freedom Charter. So, that means that he is still ignorant of the fact that that is not a document of the ANC, but that it comes from the Congress of the People.

Mr O M THETJENG: Chair, the 2010 World Cup provides South Africans with big challenges for our roads and transport system in general. Already there is massive congestion on our roads, particularly in the metropolitan cities such as Cape Town, Johannesburg, eThekwini, Port Elizabeth and many others. You can see for yourselves how difficult it is to travel on the roads of Cape Town during peak hours. Actually, the need for a place like Cape Town to urgently consider its transport system to ferry commuters, particularly workers, to their place of employment and their homes is more urgent than ever before.

Our major commuter transport system is mainly limited to buses, rail, and taxis; there are others, of course. There is a great need to diversify the transport system to encompass new developments to relieve our already overused roads. Our transport system is disjointed and needs to be integrated. It should be made possible and easy for a commuter to purchase a ticket for a train, and then be allowed to proceed to the bus and taxi mode of transport using the same ticket.

This will cut down on time that the commuters have to spend on the road doing absolutely nothing. This will put South Africa on a higher level in terms of world competitiveness, and we will compare better with the rest of the developing and developed world. We should not be caught napping in 2010 and beyond.

Thanks for bringing the Taxi Recapitalisation Programme back from the brink of collapse, Minister. I hope and believe that profitable routes will be encouraged for bigger vehicles, while struggling ones will be given as an option for smaller but efficient vehicles. This will perhaps allow better vehicles on our roads in some instances.

One wonders whether the criteria used to determine the roadworthiness of a taxi is the same throughout the country. In most rural areas the state of the taxis that transport commuters between places leaves much to be desired. The worst ones are those that normally travel the bad gravel roads of our rural areas. Owners sometimes argue that they cannot buy the best cars to use on the worst roads. Maybe there is a need to ensure that the state of the gravel roads is improved and developed on a continuous basis to encourage operators and owners to purchase good vehicles. Some of these vehicles are such that, on rainy days, commuters get wet; it is as if you are outside, not inside a vehicle.

The rail system has collapsed and needs urgent revitalisation. I have just heard that the department is in a process to put that in place. This has meant that major transportation of goods has to be done via the road network. Tracks and locomotives that are ageing need replacement to ensure safety to avoid disasters such as those that happened previously in KwaZulu- Natal and elsewhere.

Massive funding and investment is needed from Treasury to realise some of the massive projects that are underway at present. History can be talked about, but can never provide us with the solutions that we need presently. Developmental plans that are achievable and safety conscious need to be put in place; history can never give us the better things we need.

There are various modes of vehicles that transport food and other commodities from one point to another within the borders of this country and across our borders. The Department of Minerals and Energy is the one that needs to ensure stabilisation of fuel prices. It has a direct link to this department because fuel is used by various means of transport and, yet, this department determines the prices. Food prices tend to go up when fuel prices increase, but never go down when fuel prices decrease.

I hope that these two departments are in the same cluster so that the Ministers can discuss this kind of problem. If not, they should find a way to address this kind of situation. I am aware that the dollar price per barrel normally determines the price, but I believe we can work out something workable for our country.

Safety on the road is my great concern. Taxis are competing with us for a 120km/h speed limit on our roads, and it seems they continue unpunished. Some deterrent should be put in place for those who continuously violate the road users’ laws and regulations. Day in and day out, one hears of horrible accidents involving taxis and buses. Bicycles and motorcycles need to be considered as light modes of transport that do not have a negative impact on our roads. Lift clubs should be encouraged to ensure that more and more people club together for the purpose of travelling. Those that use lift clubs, bicycles and motorcycles should be provided with incentives as a form of encouragement.

South African Airways has been running at a loss and we hope that the newly appointed CEO will come with the magic touch that will turn the entity around. Provincial departments should be assisted to reduce the number of gravel roads as they deter investors. [Time expired.] [Applause.]

Rev E ADOLPH: Hon Chairperson and hon Minister, I believe that one of the greatest challenges in your department is to provide affordable, efficient and reliable public transport, especially to the poorest of the poor and the vulnerable in the community. Here I am referring to our elderly people in rural areas, school-going children and people with disabilities.

It is not merely a desire to have a smooth public transport system but it is a desperate need for everyone who lives in South Africa, to quote the Freedom Charter. There are major challenges. I travel for about one and half hours from Goodwood to Cape Town, and I see single motorists travelling to Cape Town on a daily basis. This is unacceptable; we need to replace these single motorists with lift clubs and an efficient public transport system.

We want to commend the department for the many achievements since 1994. However, we are also mindful of problems, and challenge the department to deal with the inadequate budget that they received to implement the mandate set out by the President in his 2005 state of the nation address.

It is sad to know that the general transport infrastructure is not up to standard. In the most rural areas, particularly, it is not accessible to motorists and nonmotorised transport. The conditions and quality of our major roads leave much to be desired. We actually need a traffic miracle to change our transport system in South Africa. We need massive action especially from the public and private sector to invest in our roads to make the economy grow in our country.

One of the other challenges that we welcome is in the taxi industry, which will be regulated very soon. We hope that that will decrease the unnecessary deaths of people on the roads which cost the taxpayers millions of rands. One death is one too many on our roads. We are also mindful and concerned about the many bus accidents. We need to review our public subsidy system and see how efficiently we can transport our people.

The maintenance of our deteriorating public roads is a priority, and we will have to ensure the safety of our public by reducing accidents and death on our roads.

We also welcome your integrated approach for the local transportation boards and integrated transport plans to work as a collective effort. We need the public and private sector to assist government to work together as a team; otherwise, government cannot do it alone. We support your budget speech and we want to assure you that alone you can’t do it; we need every South African to invest to make public transport efficient and affordable.

Mr C J VAN ROOYEN: Hon Chairperson, hon Minister, hon MECs, hon members, as we celebrated Africa Day this past week, it is only fitting that we put our dreams into action and really do what is necessary to heal this continent.

What better place to start than right here in our own country and, in particular, with the transport system. The legacy of apartheid left this country with a dual transport infrastructure network.

The first system is characterised by its first-world standards and consists of a well-developed network of surface roads, rail and air links, mainly serving the previously white urban areas and apartheid system. This system is currently driven by the first economy.

The second system is characterised by its inferior, Bantustan standards and consists mainly of an undeveloped transport network of low quality service, gravel roads and rail links, with very few or no air links. This system is concentrated mostly around the previous homelands and in the townships. This is still evident today, and was experienced first-hand by members of this House during the recent “taking Parliament to the People Programme in KwaZulu-Natal and Mpumalanga.

For some of the DA members, however, these trips were obviously the first excursions into the remote rural areas and townships of this country. They probably have only the programme to thank for this experience, since one doubts whether they ever would’ve travelled in these areas by choice. [Interjections.] One wonders further how they hope ever to understand the fundamental issues of our people if they are not in touch with the real South Africa. [Interjections.] The question is therefore, where does the DA hope to derive its political wisdom, guidance and leadership from as they do not have a history to fall back on, nor do they have a mandate from the majority of the people of this country, and they are totally out of touch with the realities of this country. The only conclusion one could come to is that it is true that the DA is a party without political direction and relevance. This was again displayed today by the hon Worth and Thetjeng’s participation in this debate.

As a member of the ANC I have the privilege and honour to have the Freedom Charter as my manifesto and the legacy of great leaders from whom I can tap wisdom, political understanding and even hon Tau’s grandmother! [Interjections.]

At this point it is only proper to spend a few moments on honouring one of the greatest names, namely, Chief Albert Luthuli. He was a profound thinker, a man of powerful logic and a keen sense of justice, a man of lofty principles, a bold and courageous fighter, a statesman, and a true African nationalist. As a practising Christian, Chief Luthuli generally and sincerely believed in the wellbeing, happiness and dignity of all human beings.

Transport’s role in socio-economic development cannot be underestimated. Therefore, transport policies must be geared towards the eradication of structural, economic and socioeconomic imbalances, which have caused the dual transport network, as well underdevelopment within our country.

We therefore support the department’s strategy and policies, which are aimed at contributing towards the eradication of poverty and improving the standards of life of all its citizens. It is therefore pleasing to see the focus this year’s budget has placed on the public transport sector. However, a matter of concern is the maintenance of the gravel road network in the Free State and other provinces, which consists of about 22 100 km of gravel secondary and about 22 000 km of tertiary gravel roads.

Due to a lack of funds, however, no maintenance work is currently conducted on tertiary roads, except where the road users are willing to bear the costs. This has created a situation where transport companies are unwilling to collect crops from farms, or alternatively are charging additional levies to cover maintenance costs on their fleets. This places an additional cost burden on the already beleaguered agricultural sector.

Taking into consideration that agriculture is still a major source of the Free State provincial gross regional product, GRP, and that most of these roads service the agricultural sector, including the rural areas, I would like to request National Treasury to consider providing more funds for maintenance of tertiary roads.

For the 2002-03 financial year nearly 38 000 trucks were weighed, as a result of which 12 681 freight operators were prosecuted for being overloaded. This represents a staggering 33% of all vehicles weighed in the Free State. This irresponsible behaviour by heavy truck owners is unacceptable, and government should consider additional measures to penalise repeat offenders while withdrawing or suspending licences.

A further measure could be regulations that will prohibit the transport of some hazardous cargoes per road, which will result in a increase in rail traffic. Accidents involving trucks with hazardous cargo have become a regular occurrence on our national roads. The cost of these accidents are not only counted by the lives lost unnecessarily, but also millions of rands of damage to infrastructure.

The current budget will significantly boost the public transport sector with increased investment in public transport infrastructure. The two major projects are the passenger-rail consolidation and the taxi recap programmes. Other key strategic transport areas that will receive attention are compliance with international conventions and the freight-corridor programme, which will improve South Africa’s link with the rest of Africa.

South Africa is inextricably linked to Africa and the sub-Sahara region and has therefore an important role to play in the economic rebirth of Africa, as well as the promotion of intra-African trade investment. Therefore, South Africa’s integration into Africa and the global economy necessitates the development of a freight-logistics system that can offer the same or better levels of service at a lower cost. The recent bilateral air service agreement between South Africa and Libya is but one example. I thank you. [Laughter.]

UNGQONGQOSHE WEZOKUTHUTHA: Sihlalo, angithathe leli thuba ukuthi ngibonge wonke amalunga aleli Phalamende elihloniphekile ngezinkulumo azenzile namhlanje nokuthi asisekele lesi sabiwomali soMnyango wezokuthutha.

Mangithathe leli thuba futhi ukuthi ngibonge zonke izikhulu zasePhalamende ikakhulukazi lezo ezikuleli komidi okuyilona eliphethe lezi zindaba zokuthutha, ikakhulukazi uSihlalo uMnu uTau nabo bonke asebenza nabo ngokuzwana nangendlela abasebenzisana ngayo nezikhulu zoMnyango wami wezokuThutha. Mangibonge futhi kakhulu amazwi akhayo kagogo wakhe. Kodwa ngesikhathi ekhuluma ngike ngacabanga ukuthi mhlawumbe lo gogo wakhe sengathi uwuyena futhi. Ngiyethemba-ke ukuthi nathi la ePhalamende sizoba nogogo abaningi abakhuluma njengogogo kaTau.

Mangibonge kakhulu futhi izikhulu zoMnyango wezokuThutha, usigaxamabhande woMnyango uNkk Mpumi Mpofu kanye nabo bonke abasebenzisana kakhulu nePhalamende. Mangibonge futhi nomsebenzi abawenzayo owenza ukuthi umbutho wethu lona wezothutho uhambe kahle la eNingizimu Afrika.

Kunamazwi amaningi ashiwo lana. Ngizothanda nje ukuthi ngithi qaphu qaphu ngoba okuningi sengingabe ngiphinda okushiwo ngamaqabane nazo zonke izinhlangano ezikhona la ePhalamende.

Okubalulekile wudaba lwemigwaqo. Le ndaba le ibaluleke kakhulu nathi sikwezothutho uma sibheka nje isabelo sezimali salo Mnyango siyabona ukuthi siyakhula yonke iminyaka. Uma ubheka nje kulolu hlaka lwamaphakathi nesikhathi lwezimali ezisetshenziswe, i-Medium Term Expenditure Framework, uzothola ukuthi kule minyaka emithathu ezayo isabelo sezimali esikhishelwa imigwaqo sizokwanda kakhulu kube ngamaphesenti afika kwi-11, okukhombisa ngokusobala ukuthi uhulumeni nawo usuyabona ukuthi le ndaba yemigwaqo ibalulekile ngoba uma imigwaqo ingekho kahle umnotho wezwe ngeke ukwazi ukuthi usisebenzise kahle.

Njengoba abaningi sebechazile kuleli Phalamende ukuthi umgwaqo phela yiyona nkosi yaseNingizimu Afrika uma uqhathaniswa nojantshi wezitimela. Uma ubheka nje ukuthuthwa kwezimpahla, amaphesenti angaphezulu kwama-80 alezo zimpahla zithuthwa ngemigwaqo kanti u-20% uhamba ngololiwe kaSpoornet. Leyo nto ichaza ukuthi kufanele kube khona imikhankaso eminingi esizoyenza ukuthi kube khona inguquko, ukuthi ezinye izimpahla zisuke emgwaqeni ziye kujantshi kaloliwe. Njengoba amanye amaqabane esechazile, imigwaqo iyonakala uma sithutha mhlawumbe nje amalahle noma sithutha izinto ezikwaziyo ukuthi zibulale.

Kuyasijabulisa thina ukuthi kuhulumeni ikakhulukazi ngakwezokwaba, iNational Treasury iyachaza ukuthi le ndaba izoyeseka uma kuyiwa phambili.

Abanye bachazile bathi bafuna kube khona isizumbulu semali nje okuzoba yisabelo semigwaqo. Ngiyathanda ukuthi babheke ikakhulukazi ikhomishani yezimali, iFinancial and Fiscal Commission ngoba iyaluchaza lolu daba kabanzana uma amalungu ePhalamende engalifunda leli bhuku, angakwazi ukuthi achazeleke kahle ukuthi le nto ihamba kanjani ngoba ayilula njengoba siyibeka. Kodwa-ke nathi siyathanda ukuthi isabelo sethu sezimali siqhubeke ikakhulukazi kwezemigwaqo ngoba siyazi ukuthi leyo ngqalasizinda yemigwaqo ibaluleke kangakanani kwezomnotho eNingizimu Afrika.

Elinye iphuzu elibekwe yizikhulumi yile ndaba yokuthi kukhona amalayisense okushayela okuthiwa awumshoshaphansi, abanye abathi umkokotelo. Hhayi bakwethu, asichaze phela ningabe senethuka kakhulu ukuthi ngisho namalayisense enu la ePhalamende nawo ayimikokotelo.

Into ekade ichazwa, kuthiwa kukhona amaphutha enzekayo uma abantu beyohlolwa mhlawumbe uma uyohlolwa amehlo ukuthi umuntu usakwazi yini ukubona uma eshayela ikakhulukazi ebusuku, kwenzeke ngesinye isikhathi ukuthi kungabi umuntu oqeqeshiwe ukuthi ahlole amehlo. Yizinto ezifana nalezo-ke esizichazayo. Yikho-ke uMnyango wami wahamba wayolanda bona ofezela ukuthi ke balubhekisise kahle lolu daba ukuze sikwazi ukuthi sibe neqiniso ukuthi wonke la malayisense ahamba ngendlela ekahle na.

Kukhona abanye abachaze ngale ndaba esiyibiza ngokuthi yi-LDV, ngamanye amazwi lawa mabhaki okuthuthwa ngawo abantu ezindaweni zasemakhaya. Leyo nto yinto engeyinhle kodwa kufuneka sazi ukuthi ezindaweni zasemakhaya izimoto azikho kahle.

Kuzofuneka ukuthi siyichaze kahle le ndaba ukuthi sike saba komunye umhlangano e-Addis Abbaba lapho kwakuhlangene khona ongqongqoshe bezokuthutha bayo yonke i-Afrika AU lapho esavumelana khona ukuthi le nto esiyibiza ngesilungu ngokuthi yi-Millenium Development Goals kuzofanele nathi sihambe phezu kwayo kwezokuthutha. Lolo hlelo luchaza izinto eziningi okuyizinqumo ezathathwa lapho. Lezo zinqumo zizonikezwa abaphathi bethu, abaholi, omongameli bonke base-Afrika ngenyanga ezayo ukuze uma sebeya lena eNhlanganweni yeziZwe ngoSeptemba kube khona into ebambekayo esisho ngayo thina base Afrika ukuthi sihamba kanjani. Okunye kwako kuchaza ukuthi wonke amaphandle noma amavileji, kuzofanele ukuthi abe nemigwaqo engu-2km lapho abantu behlala khona.

Okunye okudinga ngikubeke ukuze abantu bazi, ukuthi kukhona imikhankaso esiyenzayo njengohulumeni sihlangene nabanye ohulumeni base-Afrika ukuze ezokuthutha nazo zibe wungqoshishilizi ekuzabalazeleni ukuthi kube khona impilo engcono e-Afrika.

Ozakwethu basezifundazweni, ondunankulu, bachazile konke ukuthi izinto zihamba kanjani nangemikhanakaso. Angifuni ukuthi ngiphinde amazwi abo ngaphandle kokuthi ngichaze nokuthi ngibonge umfowethu uMhlahlwa le eKoloni ngithi hhayi nathi singuMnyango kazwelonke sihamba naye kule-Economic Indaba akhuluma ngayo, ngoba indaba yojantshi ibalulekile eNingizimu Afrika. Kodwa-ke mfowethu wazi ukuthi njengoba usuke wazimisela nokuthi isikhumulo sezindiza eMtata sengathi sesimi kahle, sizokwazi ukuthi silandele sibone ukuthi simi kahle ngempela na ukuze nayo ibe kahle ibe ngaphansi kwalolu hlelo esilubiza nge-National Aviation Safety and Security Plan.

Okokugcina okufanele ngikuchaze ukuthi okukade kushiwo umfowethu lona uThetjeng, angazi ukuthi sibizwa kanjani ngesiZulu isibongo salo mfowethu, kodwa kufanele azi kahle ukuthi le nhlangano yabantu eyayingo-1955 kwakungeyona inhlangano ka-ANC yize noma u-ANC wayengungqaphambili eshushumbisa abantu ukuthi beze lapha eKliptown, kwakungusomqulu wesizwe lowo, i-Freedom Charter. U-ANC waze wayivuma leyo-Freedom Charter ngo-1956 emuva konyaka kube khona i-Congress of the people. Ngiyathanda ukuthi ngimnikeze ithuba umfowethu ukuthi uma usuphelile lo mhlangano ngingambiza ngimchazele kabanzi ngoSomqulu weNkululeko. [Ihlombe.] Uma ethanda futhi ngingamnikeza namadokodo esizobe siwaxoxa singuKhongolose kwi-National General Council kule nyanga ezoqala ukuze uma ekhuluma ngoJulayi noma ngo- Agasti akhulume ngento ayaziyo ezokwazi ukuthi yakhe. [Uhleko.]

Kodwa-ke ngiyabonga Mphathisihlalo ukuthi ninginikeze ithuba ukuthi lo mhlangano uhambe kahle. Nami ngithi halala ngevoti yezokuthutha. [Ihlombe.] (Translation of isiZulu speech follows.)

[The MINISTER OF TRANSPORT: Chairperson, let me take this opportunity to thank members of this august House for the speeches they made here today and also for saying, “Let’s support this Budget Vote of the Department of Transport”.

Let me also take this opportunity to thank all those members in this House who are on the transport committee, more especially the Chairperson, Mr Tau, and all those he works with in such an understanding way. I also convey thanks for the way they interact with the officials of my department, the Department of Transport. Let me also thank his granny for her constructive words. But for a minute there, when he spoke I thought he himself was the granny that he was talking about! I therefore trust that we will have many grannies who talk like Tau’s.

Let me also thank the officials from the Department of Transport, the Director-General of the department, Ms Mpumi Mpofu, and all those who work closely with Parliament. Let me also thank them for a job well done, which ensures the smooth running of the transport industry here in South Africa.

A lot has been said here. I would just like to highlight a few points, because if I say too much it would be tantamount to repeating what the comrades and other political parties present here in Parliament have already said.

Of importance is the issue of roads. This issue is important to such an extent that even we in the Department of Transport, when we look at the budget allocation of this department, notice that it is growing every year. If you look at the Medium-Term Expenditure Framework, you will see that in the next three years the allocation for road improvement will increase by 11%, which indicates clearly that the government realises the question of roads is very important; because if there are no roads the economy of the country cannot thrive.

It is as members have explained in this House - roads lead the pack in South Africa when compared to railway lines. If you look at the transportation of goods, more than 80% of goods are freighted by road and only 20% by railway line, or Spoornet. This means that there is a need for many campaigns to be held to facilitate change, as most goods should move away from the roads to the railway lines. As many comrades have explained, the roads are damaged if we transport things like coal, or things capable of damaging the road. It makes us happy that the government, especially the National Treasury, says that it will support this initiative if it goes forward.

Some members have said here that they wished that an allocation could be made mainly for the construction of roads. I would like to ask those members to read the Financial and Fiscal Commission’s booklet, because it talks about this and it will be easy for members to understand how these things are done, because it is not as simple as it sounds. But on the other hand we would also like to have a better share of the budget allocation for the construction of roads, because we all know that the road infrastructure is very important in the economy of South Africa.

Another point touched on by the speakers was the issue of fraudulent driving licenses, which some call “sham”. Dear people, do not despair and even think that even your licences, as you are sitting here in Parliament, are also bogus.

This has always been explained as being typical human errors, just like when someone is to be examined to determine whether he or she can see when he or she is driving at night, and at times it happens that the person who tests the eyes is not trained to do that. It is a typical thing like this that we are explaining. It was against this background that my department asked the Scorpions to look into this matter so as to be sure that every thing that has to do with licences is legal.

There are those here who spoke about the LDVs, in other words, the bakkies that are used in rural areas to transport the community. This is not a good thing at all, but we also should realise that there are no cars in the rural areas.

We need to explain this by saying that we had a meeting at Addis Ababa, where all the Ministers of transport of the whole African Union, AU, agreed that the Millennium Development Goals should also be followed by the transport industry. This project clarifies many things, which arise from the decisions that were made there. These decisions will be passed on to our bosses, leaders, and all African presidents next month so that when they go to the United Nations in September they have something tangible in their possession that stipulates our position as Africa. One of the decisions was that people from rural areas or villages should have a road at least 2km from where they reside.

The other thing that I need to say so that people can know, is that there are campaigns that we as the government, in conjunction with other African governments, are undertaking so that the transport industry can also play a leading role in making better the lives of the people in Africa.

My colleagues from the provinces, the Premiers, have explained how things are going as far as the campaigns are concerned. I do not want to repeat what has already been said, except to thank Mr Mhlahlwa in the Cape and say that we as department are with him in the economic indaba that he has spoken about, because the question of railway lines is important in South Africa. But, my brother, you should know that as you have already spearheaded that and even seen to it that the Mthatha Airport is up to standard. We will then follow suit and see to it that the airport is incorporated under the National Aviation Safety and Security Plan.

The last thing that I have to explain is what was said by my brother Thetjeng, I don’t know how his surname is pronounced in isiZulu, but he should, however, know that the Congress of the People, which was held in 1955, was not a meeting of the ANC, even though the ANC was the leading organisation pushing people to go to Kliptown, but what emanated from it was a people’s document, the Freedom Charter. The ANC only accepted the Freedom Charter in 1956, a year after the Congress of the People. I would like to give my brother a chance after the adjournment; I can call him and explain the Freedom Charter to him in detail. [Applause.] If he likes, I can also give him the agenda of what we, as the ANC, will be discussing at the national General Council next month so that when he speaks of July and August, he speaks constructively about something that he knows. [Laughter.]

However, I thank you, Chairperson, for giving me this chance to experience the smooth running of this meeting. I also say want to give a thumbs up to the Transport Budget Vote. [Applause.]]

The CHAIRPERSON OF COMMITTEES: Hon members, on your behalf I would like to take this opportunity to thank the Minister for presenting the Transport Budget Policy Vote before this House this afternoon. I also wish to extend a word of thanks to the MECs who deemed it fit to participate in this important debate.

Debate concluded.

The House adjourned at 18:00. ____

            ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS



                        THURSDAY, 26 MAY 2005

TABLINGS

National Assembly and National Council of Provinces

1. The Minister for Justice and Constitutional Development

   (a) Report on the provisional suspension from office of senior magistrate Mr. S E Tebe.

   (b) Report on the provisional suspension from office of magistrate Mr. L D Monageng.

                      FRIDAY, 27 MAY 2005
   

ANNOUNCEMENTS

National Assembly and National Council of Provinces

1. Withdrawal of Bills

   On 26 May 2005 the Minister of Environmental Affairs and Tourism withdrew the following Bill: (i) Marine Living Resources Amendment Bill [B 16 – 2005] (National Assembly – sec 75)

TABLINGS

National Assembly and National Council of Provinces

1. The Minister of Finance

   Government Notice No 365 published in Government Gazette No 27487 dated 14 April 2005: Framework for Conditional Grants to Provinces in terms of Division of Revenue Act, 2005 (Act No 1 of 2005).

2. The Minister of Trade and Industry

   (a) Government Notice No R.1342 published in Government Gazette No 26994 dated 12 November 2004: National Gambling Regulations in terms of section 87 read with Item 8 of the Schedule to the National Gambling Act, 2004 (Act No 7 of 2004).

   (b) Government Notice No R.1311 published in Government Gazette No 26962 dated 12 November 2004: Standards Matters in terms of the Standards Act, 1993 (Act No 29 of 1993).

   (c) Government Notice No R.1315 published in Government Gazette No 26962 dated 12 November 2004: Standards Matters in terms of the Standards Act, 1993 (Act No 29 of 1993).

   (d) Government Notice No R.1397 published in Government Gazette No 27038 dated 3 December 2004: Strategic Industrial Project (SIP): Notice in terms of section 12G(16) d of the Income Tax Act, 1962 (Act No 58 of 1962).

   (e) Government Notice No R.1398 published in Government Gazette No 27038 dated 3 December 2004: Strategic Industrial Project (SIP): Notice in terms of section 12G(16) d of the Income Tax Act, 1962 (Act No 58 of 1962).

   (f) Government Notice No R.1399 published in Government Gazette No 27038 dated 3 December 2004: Strategic Industrial Project (SIP): Notice in terms of section 12G(16) d of the Income Tax Act, 1962 (Act No 58 of 1962).

   (g) Government Notice No R.1441 published in Government Gazette No 27097 dated 17 December 2004: Strategic Industrial Project (SIP): Notice in terms of section 12G(16) d of the Income Tax Act, 1962 (Act No 58 of 1962).

   (h) Government Notice No R.1442 published in Government Gazette No 27097 dated 17 December 2004: Strategic Industrial Project (SIP): Notice in terms of section 12G(16) d of the Income Tax Act, 1962 (Act No 58 of 1962).

   (i) Proclamation No R.2 published in Government Gazette No 27157 dated 14 January 2005: Transfer of the administration of the Co- operatives Act, 1981 (Act No 91 of 1981), from the Minister of Agriculture to the Minister of Trade and Industry in terms of the Constitution of the Republic of South Africa, 1996 (Act No 108 of 1996).

   (j) Government Notice No R.133 published in Government Gazette No 27269 dated 18 February 2005: National Measuring Standards in terms of the Measuring Units and National Measuring Standards Act, 1973 (Act No 76 of 1973).

   (k) Government Notice No R.134 published in Government Gazette No 27269 dated 18 February 2005: Regulations relating to the payment of levy and the issues of sales permits with regard to compulsory specifications: Amendment in terms of the Standards Act, 1993 (Act No 29 of 1993).

   (l) Government Notice No R.140 published in Government Gazette No 27269 dated 18 February 2005: Regulations relating to the payment of levy and the issues of sales permits with regard to compulsory specifications: Amendment in terms of the Standards Act, 1993 (Act No 29 of 1993).

   m) Government Notice No R.168 published in Government Gazette No 27269 dated 4 March 2005: Standards Matters in terms of the Standards Act, 1993 (Act No 29 of 1993).

National Council of Provinces

1. Report of the Select Committee on Public Services on the National Ports Bill [B 5D-2003] (National Assembly– sec 75), dated 25 May 2005:

   The Select Committee on Public Services, having considered the subject of the National Ports Bill [B5D-2003] (National Assembly- sec 75), referred to it, reports the Bill with a proposed amendment, as follows:

                           CLAUSE 78
   

   1. On page 30, line 21, to omit “of the nature of the intended action”.

                      MONDAY, 30 MAY 2005
      

ANNOUNCEMENTS

National Assembly and National Council of Provinces

1. Classification of Bills by Joint Tagging Mechanism

 (1)    The Joint Tagging Mechanism (JTM) on 30 May 2005 in terms of
     Joint Rule 160(3), classified the following Bills as section 75
     Bills:


        (i)   Prevention of Illegal Eviction from and Unlawful
          Occupation of Land Amendment Bill [B 11 – 2005] (National
          Assembly – sec 75)


        (ii)  Re-determination of the Boundaries of Cross-Boundary
          Municipalities Bill [B 12 – 2005] (National Assembly – sec
          75)



        (iii)South African Sports Commission Act Repeal Bill [B 13 –
           2005] (National Assembly – sec 75)

1. Translations of Bills submitted

 (1)    The Minister of Finance


        i) uMthetho woKwabiwa kweziMali zoMbuso [UM 8 – 2005] (National
           Assembly – sec 76)


     This is the official translation into isiZulu of the Division of
     Revenue Bill [B 8 – 2005] (National Assembly – sec 76).

TABLINGS

National Assembly and National Council of Provinces

1. The Minister for Agriculture and Land Affairs

   Report and Financial Statements of the Commission on Restitution of Land Rights for 2004-2005 [RP 49-2005].

COMMITTEE REPORTS

National Council of Provinces

1. Report of the Select Committee on Finance on the Public Hearings on the Division of Revenue Bill from 2-7 March 2005:

   The Select Committee on Finance, having held public hearings on the Division of Revenue Bill [B8B – 2005] from 02 to 07 March 2005, reports as follows:

2. Executive Summary

   The report details the hearings convened by the Select Committee on Finance on the Division of Revenue Bill [B8B-2005] from 2-7 March 2005.

   The Committee commenced the hearings with a briefing by the National Treasury, the Finance and Fiscal Commission (FFC) and the South African Local Government Association (SALGA). Sessions were subsequently held with various national Departments. The presentations of both the National Treasury and the FFC followed a similar sequence, dealing with the Provincial Equitable Share System, the Local Government Equitable Share System, and then the intergovernmental fiscal system.

3. Introduction

   The Division of Revenue Bill was tabled simultaneously with the Budget speech and other key budget documents on 23 February 2005. This was in accordance with Section 214 of the Constitution, which requires that Government ensure a transparent and equitable system to divide nationally raised revenue between the three spheres of Government. In addition, Section 10(5) of the Intergovernmental Fiscal Relations Act gives effect to the Constitution with regard to consultation processes. The Division of Revenue Bill enables Provinces and Municipalities to budget for their allocations, determining how their share of nationally raised revenue will be used to give expression to their priorities.

   The total national budget for 2005-06 amounts to R417,8 billion, from which National Government is allocated R273,5 billion, provinces R134,7 billion and local government R9,6 billion. Furthermore, in the 2005-6 financial year the equitable share allocated to provinces and Municipalities are R134,7 billion and R10,6 billion respectively.

   The Bill allocates R10,6 billion to provinces and R5,4 billion to Municipalities in 2005-06 to fund infrastructure and hospital services. The provincial and municipal infrastructure grants also support expanded public works programmes. Other grants include specific purpose conditional and other grants to provinces and local government, for example, the three conditional grants for HIV and AIDS programmes, in health, education and social development.

4. Layout of the Division of Revenue Bill

3.1 Provinces

 There have been significant changes in the provincial fiscal framework,
 which inform the 2005 MTEF. These are:


• The conditional grant framework has been revised to take into account
  the social security grant function that moved to the national sphere
  of Government from 1 April 2005.

• A new conditional grant has been introduced to fund the
  recapitalisation of further education and training colleges.

• The housing conditional grant has been adjusted to take into account
  the new housing policy.

• A broad overview of the Provincial budget framework over the 2005 MTEF
  indicates the following facts:

• R22,3 billion is added over the baseline for social security grants
  over the next three years.

• R6,9 billion is set aside over the next three years to implement pay
  progression in education in line with Government’s strategy to improve
  remuneration packages of educators, attract and retain management
  skills in schools and accelerate the delivery of quality mathematics
  and science education.
• R2 billion is added to the housing subsidy programme over the next
  three years to support the implementation of the new housing delivery
  strategy.

• R1 billion is invested in the recapitalisation programme for Further
  Education and Training (FET), specifically targeting the
  rehabilitation of infrastructure, improved governance and
  administration, and greater curriculum flexibility.

• R1 billion is added to the provincial infrastructure grant over the
  MTEF to speed up delivery of social and economic infrastructure.  This
  addition brings results in total allocations for the provincial
  infrastructure grant of R13,2 billion over the next three years.

• R540 million is added to the National Tertiary Services grant
  administered by the national Department of Health. Health conditional
  grants are currently being reviewed to increase their efficacy and the
  results of this review will inform their configuration from the 2006
  Budget.

FFC’s inputs on the Provincial Framework

• The FFC reiterated its previous recommendation that the provinces need
  to augment provincially raised revenues through the implementation of
  Section 228 of the Constitution and take advantage of the provisions
  of the Provincial Tax Regulation Process Act, which government seems
  to agree with.  The reduction of economic activity weighting may
  represent an indirect incentive for provinces to increase own revenue.

• The FFC agrees with the removal of the backlogs component in favour of
  a conditional Provincial Infrastructure Grant.

• The FFC views the issue of poverty targeting in a holistic manner and
  therefore suggests that further work, including a detailed assessment
  of all transfers in the system is required in order to determine the
  appropriate trade-off between poverty and economic activity. This
  would be in line with the criteria in S 214 (2) (a)-(j) of the
  Constitution.

• The FFC supports the expansion of the PES formula to incorporate (ECD)
  Grade R and the equal weighting of school age population and actual
  enrolment.

• The FFC agrees with Government’s concerns with data constraints with
  respect to the health care component, but also emphasises the need for
  the Department of Health to prioritise the collection of the relevant
  data.

• The FFC highlighted that it is important for government to provide
  clarity on the basket of services that provinces are expected to
  provide and the appropriate funding mechanism.

• The FFC proposed that Government utilise the FFC capital grant scheme
  model for the equitable allocation of infrastructure grants to
  provinces. Provinces will qualify based on the state of their capital
  stock for a backlog and a maintenance pool of funds. While the
  backlogs component is conditional, provinces have the flexibility to
  choose their priority sectors.

• The FFC will engage with government in assessing the availability of
  sector specific data so as to target sectoral infrastructure backlogs.

3.2 Local Government

• Municipalities will receive an additional R5,4 billion over the MTEF,
  which will mainly be targeted towards the provision and expansion of
  free basic services, as well as job creation through investment in
  labour based infrastructure programmes. In total, R31,5 billion over
  the 2005 MTEF is made available for water, electricity, refuse removal
  and sanitation though the unconditional local government equitable
  share.

• Funding for free basic services is directed through the local
  government equitable share, which increases from R9,6 billion in 2005-
  06 to R11,4 billion in 2007-08. This unconditional equitable share
  component grows to 56 per cent of national transfers to local
  government in 2005-06.

  The Municipal Infrastructure Grant (MIG) is the key instrument to
 support the infrastructure budgets of municipalities, to support the
 extension of services to poor households, maintain and upgrade
 municipal infrastructure, and promote urban renewal and rural
 development.  The MIG total R21,6 billion over the next three years,
 reflecting an additional R1,7 billion. This includes a ring-fenced
 allocation of R1,2 billion for the eradication of the bucket system.

FFC’s view on the Local Government framework

• The FFC supports the Government’s endorsement of a components-based
  approach rather than the ad hoc use of funding windows, which has
  characterised the development of the LES formula.

• The FFC supports Government’s inclusion of more direct revenue raising
  capacity component in the revised LES formula. The Commission has
  noted the problems associated with measurement and accepts the interim
  proxy measure introduced by National Treasury. The Commission will
  continue with its work on the identification of appropriate measures
  for revenue raising capacity.

• The Commission will also continue with its ongoing work of researching
  the costs of a basket of municipal services. This exercise would be
  enriched if government can define the list of the basic services that
  all municipalities are expected to deliver.

  Review of Intergovernmental Fiscal System

  The 2005 Division of Revenue Bill introduces new provisions to
 improve intergovernmental co-ordination and performance, by:

(a)     Enabling Ministers with concurrent functions to make
    recommendations on improving service delivery.4


(b)     Improving governance over the administration of social grants.5


(c)     Strengthening the provisions on withholding, stopping and re-
    allocation of funds.6


   d) Ensuring that conditional grants are spent in line with their
      purpose, and preventing fiscal dumping when there is underspending
      on such grants.7


(e)     Improving planning and monitoring of infrastructure grants.8

All the above provisions were approved and supported by the FFC.

1. National Treasury Briefing

   National Treasury addressed the Committee on the Division of Revenue Bill and the new formula that was being used to determine the equitable share for provinces.

   The Treasury indicated that while the Budget Council considered provincial proposals, the Budget Forum considered the local government proposals. The Treasury detailed the consultation process to the Committee.

   The Treasury started its presentation by indicating that the Division of Revenue Bill was a legal document arising from Section 214 of the Constitution, and that a new formula has now been introduced to determine the division of revenue. The new formula arose from the recommendations of the FFC, which had been necessitated by changes in the socioeconomic demographics of the country over the last few years. The FFC advocated changes to the weightings of the formula.

The following FFC recommendations were implemented:

• The Early Childhood Development grant is now being included in the
  equitable share formula. The FFC also advocates a regular revision of
  weights in order to ensure that they take into account the shift of
  the social security grant function and all other components that have
  shifted.

• The school age cohort component has been eliminated to determine the
  equitable share. Enrolment data obtained from schools was not reliable
  and therefore the enrolment and school age cohort was given an equal
  weighting.


• Considerable reduction of the economic activity component due to the
  fact that it tends to offset the redistributive element in the current
  poverty formula.

• Although Treasury concurs that it would be ideal for cost disabilities
  to be taken into account to ensure equity and efficiency, this is
  difficult to implement as cost disabilities differ in each province.
  The approach has the same challenges related to the costed-norms
  approach.

• Treasury also provided the structure of the review of the conditional
  grants transfer system. The presentation focused specifically on the
  supplementary January 2005 proposals on the social grant shift to
  National Government and the Capital Grants model.

  Concerns raised by the Committee

  The Committee raised the following concerns:

• Whether the removal of certain components of the formula, such as the
  school age cohort component, would impact on service delivery, and
  whether these will be replaced.


• Whether the transfer of allocations meant that funds would be taken
  away from a province that might be in dire need but could not utilise
  the funds to a better-off province that could utilise them.

• Capacity concerns around the transfer of the housing function from
  provinces to local government.

• With respect to the revenue raising capacity component in the formula
  the Committee enquired how the potential revenue would be determined
  and by whom.

• The Committee requested clarity on the RSC levies that Municipalities
  raised, as well as the question of research around the devolution of
  powers with respect to housing. The Committee enquired how the poverty
  component was determined since some provinces such as Gauteng, was
  regarded as a rich province, yet it had the most informal settlements.

• The transfer of funds from one region to another has to be a
  transparent one, and the guidelines for these transfers have to be
  clear.

• Municipalities have raised several concerns regarding the transfer of
  the water function to them, particularly around the lack of capacity
  and a dilapidated water system.

• The Committee had reservations around the fact that national
  departments determine conditional grants. A recommendation was made
  for the FFC to assist national departments to determine a better
  formula for disbursing these funds.

• The Committee was concerned that if some Municipalities were to
  receive housing accreditation, there would be a migration of people
  from those who did not have accreditation to those who did. This also
  put the burden on Municipalities, whereas the issue that must be dealt
  with is the lack of capacity and underspending of provinces.

  To the above concerns raised by the Committee, Treasury responded as
 follows:

  The National Treasury pointed out that it has been standard practice
 to shift allocations in cases of underspending. In order to prevent
 underspending it is now common practice, particularly with donor funds,
 that a project management team is sent to assist the province that was
 underperforming. In addition, provincial departments are also required
 to provide monthly and quarterly reports. In some cases there was no
 other choice but to re-allocate funds.

  Both the Committee and the Treasury noted the possibility that this
 could potentially create the situation where “reports are glorified in
 order to avoid losing funds”. Treasury relies on managers to act
 responsibly as the system would foster possibilities for improvement.
 However, there needs to be tangible information that can be compared
 with the financial information. Furthermore, in order to ensure
 transparency, a short memorandum detailing the purpose of the transfer
 would be provided. Treasury indicated that this would be difficult to
 implement.

  The FFC agreed with the National Treasury in this regard, and pointed
 out that any imbalance which occurred should be corrected in the
 following financial year.

  SALGA indicated that there was a need for a turnaround strategy to
 assist provinces that were struggling so that they could provide the
 resources needed in a shorter time.

  Treasury indicated that the concern that provinces were getting less
 because of the new formula was unfounded, and that there had actually
 been a steady increase in the percentage that provinces were getting.

  The accreditation of Municipalities arose from the Housing Act and
 the Division of Revenue Bill only seeks to accelerate the process. The
 service was transferred to Municipalities because they provide the
 services as well. However, capacity is a major concern.

  The poverty component is difficult to measure and if the number of
 informal settlements was used, it would not be accurate. Income per
 household was used as a measure and this is more accurate. Even though
 Gauteng has more informal settlements, income is higher than in other
 provinces. Referring to the money allocated per household, Treasury
 indicated that the money was given to supply infrastructure and not
 services. There was no sense in giving money for services when the
 infrastructure was not present. Having the FFC assist the departments
 is a possibility that is still being considered.

  Treasury indicated that it had conducted the revenue raising
 correction for Municipalities. Treasury had decided on a non-arbitrary
 approach, which ensures that the parameters and weights could not be
 imposed on an ad hoc basis and would therefore not be open to
 manipulation by Municipalities.

  Treasury indicated that it was working at finding alternate ways to
 deal with RSC levies, which would include either a tax or grant.

  Regarding the water-operating subsidy, Treasury indicated that this
 was a Cabinet decision and was also a bilateral contract process that
 had to be followed. Municipalities had to enter into a contract and
 national government would abide by its responsibilities until the grant
 was phased out in 2011 or 2012.

  The Treasury indicated that the allocation for the removal of the
 bucket system was not based on a formula, but rather in response to a
 need. There are capacity problems in this area as well.

  Treasury referred to the fluctuations in the figures in the Bill and
 indicated that these are due to a new model coming into force in 2007-
 08. The aim of the new model is to serve as an incentive to
 Municipalities to provide services to the poor so that their share
 could increase.

1. Briefing by Financial and Fiscal Commission

   FFC’s submission was based on the annual commentary it has made on the Division of Revenue Bill, which in turn derived from its constitutional and legislative mandate (section 214(1) of the Constitution) and is given effect in the Intergovernmental Fiscal Relations Act of 1998. The FFC requires consultation between the Commission and the Minister of Finance 14 days prior to the introduction of the Bill.

   The FFC evaluates its criteria against Section 214 (a)-(j) of the Constitution and the progressive realisation of constitutionally mandated basic services. Until 2005, the constitutionally mandated basic social services (CMBS) of social assistance and welfare, education, health care and food adequacy have been the functional responsibilities of provincial governments, with the exception of food programmes, that have been funded through the unconditional Provincial Equitable Share grant. Social assistance grants are due to be transferred to a National Agency. A conditional grant, which is ring- fenced for this function, will be used as an interim funding mechanism until this National Social Security Agency is established.

Social Development

  The financing of welfare services was highlighted with a view that
 there is a need to respond more directly on defining a basket of
 services.

Education

  The main change to the education component is the adjustment of the
 learner to school going age children, and the inclusion of early
 childhood development (ECD).

Health Care

  Spending on primary (clinics) and secondary (hospitals) health care
 averaged 2% between 1996 and 2001 and has accelerated to an average 4%
 per annum since then. Spending on hospitals has lagged behind that of
 primary health care provision in clinics.

Food Adequacy

  The Child Nutrition Grant has identified a target population of 4,58
 million poor children. Less than 1% of provincial budgets are set aside
 for food adequacy programs. However, 4% real growth in these programmes
 was projected for the 2004 medium-term budget cycle. The impact of this
 programme on the nutritional status of children has not been measured
 yet.

Performance in the Provision of Basic Infrastructure Services

  Household infrastructure services that may be constitutionally
 mandated as basic include housing, land and water. Sanitation, waste
 disposal and electricity might be implied through the environmental
 health mandate. Transport services enable access to other basic
 services and hence serve a complementary role in the provision of other
 services. Municipalities are the primary delivery agents and several
 cross-municipal public entities are involved. Most capital funding is
 through special purpose conditional grants or utility fees.

Housing

  The delivery rate of housing over the past decade has exceeded the
 rate of household formation. On average, approximately 161 400 housing
 opportunities have been delivered annually with a peak in financial
 year (FY) 1997 of 296 000. The national housing department has set a
 delivery goal of 338 000 houses per annum.

  The value of the housing capital subsidy did not keep pace with
 inflation until FY 2001 and household income brackets have not changed
 since 1995. The housing spend has decelerated since FY 2001 and is
 projected to continue declining over the 2004 medium-term. The
 operational implications of the housing capital expenditure are passed
 onto municipalities

Water

  Between 1996 and 2001, the proportion of households with reticulated
 access to water increased from 60% to 62%. The current norm is 50
 litres per person per day within 200 metres of the dwelling. Full
 access to water services is targeted for 2008.

  Since FY 2001, Municipalities have increased their capital spending
 but reduced their operational spending whilst the regional Water Boards
 have reduced their capital spending and increased their operational
 spending in real terms on the provision of water.

Sanitation and Waste Disposal

  The proportion of households with water-borne sewerage or VIP toilets
 increased from 50% to 55% between 1996 and 2001, whilst the proportion
 receiving municipal waste disposal services increased from 53% to 57%.
 Coverage improvement in the metropolitan areas was less substantial.
 This could be as a result of rapid urban migration of the poor. Full
 access to adequate sanitation is targeted for 2010.

Electricity

  Coverage rates for connections to the national or municipal grid
 increased from 57% of households to 70% between 1996 and 2001.
 Government has targeted full coverage by 2012.

  Regional Electricity Distributors (REDs) are being operationalised
 from 2005. The distribution of electricity surpluses and the
 implications of that for municipal billing systems are being addressed.

Transport

  In FY 2003, provincial governments undertook 57%, Municipalities 30%
 and national government 13% of road construction and maintenance
 spending. Between FY 2000 and FY 2004, provincial spending on roads
 increased by 11% per annum in real terms whilst spending on bus, taxi
 and train subsidies increased by 6,5%.

Components of the Formula

  Components of the Formula were reviewed against:

  1.    Set policy objectives, norms and standards.
  2.    Improvement of equity in access to basic services.
  3.    Efficiency in utilising public resources.

The Economic Activity Component

With regard to the economic activity component, the FFC highlighted that:

• Public infrastructure tends to be pressurised in areas of high
  economic activity.
• The FFC needs more clarity on the choice of the weight  used, as it is
  not clear how the weight was arrived at.
• In addition, there is a trade-off between this component and the
  poverty component.

The Poverty Component and Targeting

  The new formula includes an introduction of a 3% poverty component.
 A proper definition of what the poverty component seeks to achieve is
 needed, as well as an empirically tested method used to determine
 relative weight.

The Services Components

  This component considers the socio-economic status for different
 beneficiary groupings.  The FFC aims to conduct a review of all
 transfers aimed at targeting poverty.  Political imperatives and
 government priorities have to be considered in this regard.

Removal of the Backlogs Component

  The FFC proposed the creation of a separate conditional grant to deal
 with infrastructure. The Government has addressed this and has
 introduced the grant.

The Local Equitable Share

Cost Disabilities

  The Government and the FFC agree that different types of delivery
 methods for basic services should depend on the appropriateness and
 cost of technology. Geographic and population density considerations
 require different technologies for the delivery of similar basic
 services.

Revenue Raising Capacity and Spill-over Components

  Government supports the FFC proposal for the need to incorporate a
 revenue-raising component. In addition, further work will be carried
 out with respect to design and definition of the spill over component.

Measuring Basic Municipal Service Expenditure Needs

  The Government should define a basket of basic municipal services. It
 is also important to protect the Local Equitable Share from being ceded
 by Municipalities.
  All in all the Government agrees with the FFC regarding the structure
 of the formula and the components that should either be deleted or
 reviewed in the formula.

1. South African Local Government Association (SALGA) Briefing

SALGA’s briefing focused on three key points:

1. Predictability.
2. Simplicity and transparency.
3. Cost of service.

SALGA noted that the eradication of multiple grants has led to the introduction of the Municipal Infrastructure Grant (MIG), but contended that the Bill would reintroduce multiple grants.

Furthermore, SALGA is of the view that easily collected forms of revenue should replace Regional Services Council (RSC) levies.

  SALGA proposed that in future, when new information that affected the
 allocation of the equitable share was obtained, the same year
 allocation should be guaranteed. The amount by which the local
 government equitable share increased would be distributed only to those
 Municipalities negatively affected by the new information.

  The objective of establishing the MIG was to drop all the different
 grants targeting local government. The Division of Revenue Bill would
 see the reintroduction of the different grants. SALGA requested
 National Treasury to create conditions that would promote simplicity
 and transparency for eligible Municipalities to access the MIG.

  The revised average cost of service for serviced areas had been
 acknowledged and that of nonserviced areas had the full support of
 SALGA. It was noted that the "one size fits all" approach did not work,
 and the government should consider the introduction of different
 average service costs for Municipalities with relatively comparable
 cost of services to different categories of costs would be a more
 flexible option. The transfer of equitable municipal costs should be
 done timeously to complement basic cash management requirements in
 Municipalities. This would eliminate the problems emanating from late
 payments of service providers such as penalties.

  Finally, SALGA suggested a new source of revenue or tax should be
 introduced as a substitute for the Regional Services Council levies
 (RSC), but it should be easily collectable.

Discussions

  The Committee observed that National Treasury was entitled to
 withhold funds to truant Municipalities. Oversight visits had revealed
 that some provincial officials would sometimes urge the NCOP to
 intervene in troubled Municipalities. On closer inspection, the NCOP
 Members would discover that it was actually provinces that had not been
 playing their role. They had been supporting the Municipalities while
 those problems were being encountered. He therefore urged the NCOP to
 play the role of a regulator when dealing with such matters. The
 Committee also suggested that the Committee should call an “Indaba”,
 which would involve the Department of Provincial and Local Government
 (DPLG).

  All stakeholders should participate in the process of the division of
 revenue. The Committee asked to what extent SALGA had been involved in
 drafting the Division of Revenue Bill.

  It noted that DPLG and SALGA should capacitate Municipalities. In
 addition, there should be a consistent manner of engaging all the
 stakeholders

Responses

  SALGA replied that RSC levies had been going to Metropolitan Councils
 only. Therefore SALGA was in favour of the abolition of these levies.

  SALGA's involvement in the drafting of the budget was in the Budget
 Forum, in which it raised everything that related to revenue. Another
 forum at which SALGA had been participating was the extended Cabinet
 meeting. At both of those forums submissions were made, but the
 outcomes were totally different.

  The current Act provided for the withholding of the equitable share,
 and the withholding was supposed to happen in three phases. That would
 mean a gradual tightening of the screws in relation to which steps the
 Municipalities had to take before the transfers could be made. For an
 example, when Municipalities had not submitted the required financial
 statements. The Constitution provided for funds to be withheld when
 there was a consistent failure to account. In instances where
 Municipalities had explained why they had not met Treasury standards,
 they received funding immediately. Regarding conditional grants, it was
 the transferring official who withheld the funds because those
 conditions had not been met.

1. Inputs of Departments/Sectors on the Division of Revenue Bill

7.1 Department of Public Works (DPW) briefing

  The Department reported that the Provinces operate the Expanded
 Public Works Programme (EPWP) with funding provided by National
 Treasury, through the equitable share, on fulfilment of certain
 conditions. The role of the DPW is to ensure that EPWP tender and
 design guidelines are used on all relevant projects. Special emphasis
 is placed on projects utilising labour intensive methods. It was
 emphasised that quality and cost effectiveness are important aspects of
 all EPWP projects.

  The total targeted expenditure on EPWP projects is R15 billion, which
 is to be divided between Provinces and Municipalities. The number of
 jobs created is expected to reach 750 000. To date 130 000 jobs have
 been created and with further acceleration, a target of 300 000 jobs
 per year is expected.

  The labour intensive (LI) contractor learnership programme

  These two-year learnerships aim to develop 500 sustainable
 contractors and 1 000 site supervisors with the participation of
 Municipalities and 30 Provincial Departments. As part of the
 learnership 1 500 projects to a value of R1,5 billion will be
 implemented, employing 100 000 people.  The Department of Labour has
 committed to providing opportunities for those who had completed the LI
 programmes.

  The duration of employment differed from project to project,
 depending on the nature of the project. The length of training would
 also differ but all courses were integrated with the National
 Qualifications Framework (NQF), all qualifications were transferable
 and links would be developed with a variety of other programmes. The
 building industry had undertaken to try to recruit learners from the
 programmes and would also provide information on how to access
 opportunities.

  The DPW was aware of the possibility of job displacement when
 designing the EPWP. However, the infrastructure sector had been
 identified as a growing area over the next ten years and therefore a
 conscious decision had been taken to target that sector. In this way
 fewer machine-intensive contractors were likely to be displaced.

  Committee Concerns

  The Committee was concerned about how effective the DPW’s monitoring
 system was as there were reports of delays in the roll out of projects.
 In particular, the capacity to do effective monitoring was probed.

  The Committee enquired whether there is sufficient integration and
 interaction between National and Provincial Departments.

  The Department acknowledged that it was aware of delays and problems
 around quality. The service delivery programme aimed to improve all
 systems by April 2005. It was also acknowledged that DPW does not have
 the capacity to monitor every project. However, it was DPW’s role to
 monitor the total programme, and the role of the Provinces to monitor
 and report on the individual projects. It was emphasised that DPW
 monitored whether the projects were labour-intensive, but the hands-on
 monitoring of the project remained with the province. Accounting
 Officers in the provinces would retain their accountability on the
 individual projects. Selected projects would be evaluated by DPW on an
 annual basis. The EPWP does not allocate funds to specific projects but
 rather tries to influence Municipal and provincial spending so that it
 resulted in job creation and training. The Accounting Officers of
 provinces are responsible for the actual allocation and spending of
 funds.

  It was noted that a decision had been taken that Municipalities
 should report on their infrastructure grants only to the Department of
 Provincial and Local Government and copies of such reports would be
 made available to DPW.

  The Department of Health reported that the previous day’s hearings
 had revealed problems with DPW’s progress on hospital building. In
 KwaZulu-Natal contract management problems had created delays of ten
 months, and in Limpopo there were a tender that had closed in August
 2004 but no contracts had yet been awarded.

  The Department pointed out that provincial infrastructure projects
 would not necessarily fall under DPW if they were outside the EPWP.
 Provincial DPWs were independent of the national Department because
 they were the responsibility of provinces. However, DPW had been
 working with Treasury to develop infrastructure programmes to address
 problems that had arisen through planning and budgetary constraints.
 The Infrastructure Delivery Improvement Projects, piloted in thirteen
 provincial departments, aims to improve systems and develop capacity to
 plan and develop infrastructure projects.

  In addition, the national Department was participating in an
 infrastructure improvement programme that was attempting to address
 these problems.

  The Department noted that the national Department was not tasked with
 delivery on education, roads, health and agriculture, and that
 allocations were only given to it in respect of buildings or works for
 the SAPS, Defence Force, Correctional Services and Justice. All others
 were the responsibility of provinces, because of the functional
 divisions set out in the Constitution.

  In response to questions about the responsibility for the provision
 of roads, the Department responded that the national DPW had no control
 over roads, but in some Provinces, roads were grouped together with the
 Provincial DPW. In these cases, the roads function would fall under the
 national Department of Transport.

  The Department of Transport reported that problems with respect to
 the provision of roads had been identified. A road co-ordination body,
 comprising the national Department of Transport, all nine provinces,
 and Metros had been established. This would consider road development
 and planning, including the road classification system, with a view to
 integrating the roads network and establishing which body was
 responsible for maintenance of every stretch of road. Overloading was a
 major challenge and the plans hoped to achieve sustainability in
 construction and maintenance of all roads. Mechanisms are also now in
 place at provincial level to ensure better co-ordination and
 integration.

  The Committee questioned how compliance with EPWP Guidelines was
 enforced.

  The Department responded that there had been a lack of understanding
 as to how the EPWP should be implemented as it differed substantially
 from former projects that used normal budgets to carry out programmes.
 However, DPW had put together a team to make presentations, attend
 meetings and assist Provinces and Municipalities to understand the
 programme, and targeted municipal officials to receive training.

  The tender guidelines contained an explanation of how the guidelines
 should be implemented, how training should be accessed and what
 Municipalities should do to implement the projects. There was ongoing
 discussion with provincial Departments and Municipalities, and the
 Government Communications and Information Service and the Business
 Trust would also be involved in media briefings to increase awareness.

  It was noted that previous presentations had pointed to capacity
 problems within Municipalities and the Committee therefore asked
 whether the national DPW had budgeted for sufficient capacity at a
 local government level to ensure delivery.

  The Department reported that the national DPW were ready to deliver
 on the projects and that training programmes had trained municipal
 officials in proper development and implementation.

7.2 Department of Water Affairs and Forestry briefing

  The vision of the Department is "to work together, ensuring some
 (water), for all, forever". The Department was of the view that DORA is
 a challenge for co-operative government and service delivery.

  An amount of R138,7 million had been budgeted for implementation of
 water services projects, which would complete efforts started under the
 Water Supply and Sanitation Programme. The Water Services Operating and
 Transfer Subsidy had been budgeted at R934,4 million. DWAF schemes were
 to be transferred to Municipalities. The current budget was intended
 for operation and refurbishment. The hand-over had been extended to 31
 March 2005; 84 schemes, with a total value of R1 225 million, had been
 transferred to date. The receiving institution, in order to receive
 transfer, should have the necessary capacity for implementation of the
 conditional grant.

  The Department noted that special arrangements were necessary for
 Municipalities with weak administrative and technical capacity. From
 2008/09 grants would be incorporated into the equitable share.

  Drought relief had received an allocation of R202,5 million, of which
 R149,8 million had been expended. Hence, there would be a rollover.

Free basic water

  The provision of free basic water is made possible through the
 Equitable Share in rural areas, and cross-subsidies in Metro
 Municipalities. The equitable share provides incentives for more
 funding if Municipalities have provided better access.

  The Municipal Infrastructure Grant (MIG) replaced the DWAF capital
 programme, and water and sanitation accounted for 72% of this grant in
 2005, and 53% in the future. R200 million had been earmarked for bucket
 eradication in 2005, increasing in future years, and DWAF would support
 Municipalities in planning, implementation and monitoring.

  The grant would be managed through the Department of Provincial and
 Local Government (DPLG), but DWAF would continue to monitor and support
 service provision, and assist with standards.

  The Department gave details of the bucket eradication programme, and
 the Special Municipal Infrastructure Fund (SMIF), which is currently
 capped at 2,3% instead of the required 4%. DWAF will still engage with
 National Treasury and DPLG regarding allocations.

  The Department focused specifically on Clause 9 of Dora, which
 regulates the funding of public entities, such as water boards. Clarity
 is still required on the roles of sector departments.

  Treasury clarified that the intention of Clause 9 was to force
 Municipalities and public entities to reach agreement since public
 entities provided retail services and Municipalities could not control
 tariffs and service levels.

  Committee Concerns

  The Committee was concerned that the rollover of funds for drought
 was extended over two financial years, instead of being applied
 directly to community efforts. In addition, it was questioned why the
 rollover could not be used to address drought problems in the Northern
 Cape and to assist farmers in that area.

  DWAF stated that the Northern Cape farmers fell under the
 jurisdiction of the Department of Agriculture but that this issue could
 probably be raised at MinMEC.

  On the question of rollovers, DWAF noted that the financial years in
 National and Provincial sectors differed, and that Municipalities’
 financial years ended in July. Funds had been transferred only in
 December, and although there would be a rollover the proportional level
 of spending, by month, was correct. Emergency funding is reactive in
 nature and may only be finalised long after the event.

  The Committee asked how DWAF planned to eradicate the bucket system
 in areas where there is little water.

  The Department noted that the eradication of the bucket system would
 be undertaken wherever possible and where water-borne sewerage could be
 introduced, and would be a priority in urban areas.

  The Committee expressed concern about sanitation in schools, which in
 some cases posed serious health risks.

  The Department noted that sanitation in schools fell under the
 Department of Education, and that DWAF had already advised schools that
 it would be able to provide expertise and fix systems. He undertook to
 investigate the position.

  In addition, in many areas the infrastructure was badly managed and
 better emphasis must be placed on metering and billing.

  The Committee asked whether it was really viable to effect a hand-
 over of the water services function to Municipalities at this stage. A
 question was raised about the transfer of staff to Municipalities, and
 particularly for details on any agreements between the Department and
 the Municipality in regard to performance.

  The Department responded that funding followed functions. Since water
 management falls under the equitable share, all water-related functions
 did indeed need to be transferred to Municipalities. There were
 challenges with relation to seconded staff, but these were being
 addressed, and it was hoped that the process would be completed
 quickly. DWAF noted that all staff should be transferred with the
 function but some Municipalities had tried to reduce the staff
 component, and in such cases DWAF would negotiate for proper assurances
 and a prohibition on the appointment of additional staff until the
 lapse of a reasonable time.

  DWAF believed that the handover could be successfully completed by
 March 2006. DWAF would remain part of the process after transfer by
 assisting with takeover and giving support, and Municipalities would
 still be answerable to DWAF.

  The Department of Provincial and Local Government (DPLG) noted that
 two years ago DPLG had discussed the readiness and capacity of
 Municipalities, and issued authorisations leading to the distribution
 of functions and powers. It had also undertaken an analysis of levels
 of capacity, and where this was insufficient, DWAF and DPLG had a
 rollout initiative aimed at support. DPLG therefore agreed that this
 was an appropriate time to effect the takeover, but recognised that
 appropriate and concrete support would be given. Proper consideration
 had been given to the assignment process, by provision of necessary
 legislation, allocation of resources and continuous improvement of
 infrastructures.

  The Committee questioned whether it was really appropriate to "name
 and shame" Municipalities who did not comply with norms and standards.
 It was also asked what would be done about Municipalities who did not
 use funding for the purpose intended.

  The Department noted that it is aware of the dangers of adverse
 publicity, but felt that if water supplies were unsafe, residents
 should be notified.

  There is an improved process to ensure compliance, which involved a
 series of steps, and a number of stakeholders would be notified of
 problems in the hope that this would result in increased pressure, co-
 operation from the municipalities, and a quicker resolution of
 problems.

  The Committee asked what Municipalities could do in cases where
 municipal water charges had not been paid or illegal connections had
 been made, as it seemed that some Municipalities were cutting
 connections altogether.

  The Department explained that each Municipality has its own policy on
 payment and connections, but that it was not acceptable for a
 Municipality to stop water supplies to an entire community. In some
 areas there had been lack of communication between water boards and
 Municipalities as to who was responsible for setting tariffs. He
 conceded that there were areas where pipes had been provided but no
 water connected. Municipalities who installed meters and therefore were
 able to monitor use would receive preferential connections.

  The Committee asked whether the budget made special provision for
 areas with poor rainfall, or poor access to rivers and dams.

  The Department explained that Municipalities in these areas were
 supported by DWAF in their planning, and helped to decide if other
 interventions, such as diverting water or building dams, were needed.

  The Committee was concerned about whether anything was being done
 about rising water levels where mining had been abandoned.

  The Department explained that there was a problem in settling
 liability, for pollution in particular, between the Departments of
 Minerals and Energy and DWAF and the mining companies.

  The Committee asked how people could be assured of benefiting from
 the free basic water supply.

  The Department explained that Municipalities were encouraged to
 install monitoring so that water supply could be assured.

7.3 Department of Provincial and Local Government briefing

  An amount of R48,8 billion had been added to the baseline allocations
 of provinces and Municipalities. National transfers to Provinces would
 grow at 10,2% per year over the MTEF period and local government
 allocations would increase by 13,3%.

  The Local Government Equitable Share (LGES) requires consideration of
 basic services, development needs, institution support, the ability of
 Municipalities to raise revenue and a guarantee of allocations
 published in 2004 (a stabilisation component). This would be phased in
 over three years, and work on it would be ongoing. It was noted that
 District Municipalities, who do not provide basic services, would
 receive lower allocations.

  The Municipal Systems Improvement Grant (MSIG) is a conditional grant
 aimed at assisting Municipalities in developing in-house capacity to
 build integrated systems to perform their functions. A district-wide
 capacity building development plan would need to be prepared in
 consultation with Local Municipalities.

  The total grant allocation over the period 2005-2008 is R600 million
 and the grant would be reviewed in 2007. This grant had been challenged
 by late submission of business plans, poor spending, rollovers, and non-
 compliance with DORA and poor consultation between Districts and
 Municipalities. However, a programme of support had been developed and
 was being implemented through Project Consolidate.

  The Municipal Infrastructure Grant (MIG) was a conditional grant
 established through the merger of a number of programmes across sectors
 and intended to eradicate municipal service backlogs and provide basic
 services. An amount of R21.19 billion had been allocated over the 2005-
 2008 period. Key conditions, and roles and responsibilities were
 highlighted. DPLG administered the MIG and convened Municipal
 Infrastructure Task Team meetings, involving several other Departments,
 who retained their policy making and regulatory functions while
 providing oversight and monitoring.

  Challenges faced were similar to those of MSIG, but various
 interventions had been made to address these challenges.

  DPLG pointed out that Dora would assist it in consolidating its
 success in local government transformation. DPLG was confident that
 some of the key challenges would be addressed through Project
 Consolidate, which would assist government to provide dedicated and
 appropriate support to Municipalities.

  Committee Concerns

  The Committee asked whether the public entities referred to in Clause
 9 of the Bill could be identified, and whether they were self-
 sufficient.

  DWAF explained that the "public entities" for water were the water
 boards, which were self-sufficient and thus would not receive funding.
 DPLG was engaging SALGA in a process of institutional reform and in
 future it may be that the Boards would be dissolved. Other public
 entities would include bodies such as Eskom and Telkom.

  The Committee asked the DPLG to clarify the amount of R3 billion set
 aside for "community investment programmes" and what it would comprise.

  DPLG explained that the amounts allocated had resulted from
 successful collections by the South African Revenue Service (SARS), and
 the funding would essentially be used for infrastructure development
 through the MIG.

  The Committee asked the DPLG to clarify whether Dora addressed the
 problem of capacity, and whether Clause 42 of the Bill would assist in
 cases where there were disputes. The Committee asked what would happen
 in the case of wasteful or irregular expenditure, which had been the
 responsibility of provinces to date.

  DPLG stated that the Bill did make provision for capacity building in
 Clause 18. DPLG and Treasury would settle conditions. In the current
 financial year R182 million had been set aside to assist Municipalities
 in a range of different areas, listed in the report. It was too early
 to provide a comprehensive report in respect of the current year, but
 90% of the funds had been allocated and transferred. Addition support
 was required in 136 identified Municipalities and 37% of Municipalities
 currently had capacity to prepare and implement the IDP. Tangible and
 measurable targets were set over the next two years, covering all key
 performance areas. This was not solely an initiative of DPLG but a
 government-wide attempt to harness all resources.

  On the question of wasteful expenditure, DPLG stated that financial
 conduct was dealt with in the Municipal Finance Management Act, which
 provided for disciplinary proceedings.

  The Committee asked for clarity on the formula used for LGES. There
 was concern about under-spending and the process put in place to assist
 implementation.

  DPLG explained that MIG was only nine months old and although the
 transfers had taken place, the Municipalities were only obliged to
 complete their spending in July. So far the Municipalities were on
 track in their spending although the difference in financial year-ends
 had distorted the percentages.

  The new formula took into account cross subsidisation, and added in a
 stabilisation component. The old formula had disregarded a number of
 Municipalities intended to benefit, whereas the new formula
 incorporated incentives based on revenue raising.

  The Committee noted that in some provinces the indigency policy was
 not being implemented properly.

  DPLG explained that Municipalities were administering these policies
 differently. Some state that there would be free access to services to
 all while DPLG had inherited a list of households who do not have
 access to basic services.

  In 2004, DPLG had submitted a national standards policy to the social
 cluster, comprising Education, Health and Water, and had developed
 guidelines to assist Municipalities in implementation. Different
 provinces had decided to administer either according to a register of
 indigent people, or through a broader "service to all" which could
 account for the differences. The means test was largely used as a
 basis.

  The Committee asked how DPLG would view the stopping of allocations
 provided for in Clause 35 of the Bill.

  Treasury reported that the Minister would proceed in terms of the
 Municipal Finance Management Act and that DPLG would be consulted.
 Opportunities would be given to the province to explain itself before a
 decision to withhold payment was made.

  DPLG added that this clause had been discussed with Treasury; it was
 felt to be necessary so that funding could be reallocated. DWAF argued
 that in the past they had found DORA to be inflexible because it had
 not made provision for cases of persistent and material non-compliance.
 While Project Consolidate would be used to attempt to avoid the
 situation, this clause could be invoked as a last resort.

  The Committee enquired what formula was used for the MIG and how it
 would be disbursed. Reference was made to decreases in allocations set
 out in Schedule 3 and in Schedule 6 and whether Departments were
 consulted when allocations were made.

  DPLG replied that the formula had a number of components, including
 provision of basic services. Municipalities providing basic services
 and additional resources would gain from the equitable share. Treasury
 determined allocations, and the administration of the grant was handled
 by DPLG.

  They pointed out that funds would be disbursed in different ways
 according to the size of the scheme. Although it appeared that funding
 for DWAF had decreased, there had been a concomitant increase in the
 municipal allocation, as funding would in future fall within the
 equitable share and not the conditional grant. This was similar to the
 effect of Schedule 6.

  The Committee questioned whether the formula for MIG did not
 disadvantage the weaker or poorer Municipalities, and whether this
 might not result in migration of residents to Municipalities that could
 provide better services. It was suggested that DPLG should arrange a
 workshop on the formula for the information of the Committee.

7.4 The National Department of Health

  The Department of Health administers 6 conditional grants-

1. The National Tertiary Services Grant

2. Health Professions Training and Development Grant

3. Comprehensive HIV and AIDS Grant

4. Hospital Revitalisation Grant

5. Integrated Nutrition Programme Grant

6. Hospital Management and Quality Improvement Grant

   Each grant has its purpose and the conditional expenditure criteria are according to that purpose.

Spending patterns in 2004-05 and the Committee’s concerns

1. The National Tertiary Services Grant.

   The Committee notes that the spending pattern was generally good. Only three departments are lagging; the Eastern Cape (7,7%), the Free State (75,7%), Limpopo, (79,6%), and North West (62, 5%).

The MTEF allocation is as follows:

 The total nominal growth over the MTEF period is at 6%, with the slight
 decline over the end of the period.

1. Health Professions Training and Development Grant The Committee notes the spending pattern (2004-05) as generally good. Only three departments are lagging (Eastern Cape, 61, 5%), (Free State, 54,4%), and (Limpopo 64%).

   In terms of the future vision of the grant, hospital grants will be reviewed, with the view to restructuring all the conditional grants as well as the role of conditional grants in Health Funding.

The MTEF allocation is as follows:

The total growth only increased by 5% at the end of the period.

1. Comprehensive HIV and AIDS Grant

   The purpose is to enable the health sector to develop an effective response to the HIV and AIDS epidemic. The future of the Grant indicates that portions of the grant drop into the equitable share as the functions have become entrenched as activities in the Provincial Health Departments.

   The Committee notes that the spending pattern (2004-05), has been particularly slow in the Eastern Cape (64,4%), (Free State, 53, 91%), (Limpopo, 32, 7%), (Mpumalanga, 50%), (North West, 60%). Transfers have been delayed to the following provinces; Free State, Limpopo, Mpumalanga, Northern Cape and North West Province.

The MTEF allocation is as follows:

 The nominal growth is 38% in 2006/7. However, it declines by
 -33% over the medium term.

1. Hospital Revitalisation Grant

   The purpose of the grant is to modernise infrastructure and equipment within the context of national policy. The Grant, however, will be reviewed in future in the context of the national health funding system.

   The Committee notes slow spending patterns in Kwazulu Natal (17, 1%). The Province has decided to fund the total of the amounts transferred to date and requested that the 2004-05 amount be rolled over at national level into 2005/06 and 2006-07.

The MTEF allocation is as follows:

  The total nominal percentage increase in the short term is 15%.
 However, it declines by -9% at the end of the term.

1. Integrated Nutrition Programme Grant

   The purpose is to implement integrated nutrition activities aimed at improving the nutritional status of all South Africans. After 2005/06 the Grant will be moved to Equitable Share.

   The Committee notes that the spending pattern (2004/05), is slow especially in the (Eastern Cape, 35,5%), (Kwazulu Natal 55%), (Limpopo, 20%), (Mpumalanga 38,4%), (North West, 26,3%), (Western Cape, 46,9%).

The MTEF allocation is as follows: |Provinces |2005/06|2006/07|2007/8 | |Eastern Cape |26,316 | | | |Free State |7296 | | | |Gauteng |11333 | | | |Kwazulu Natal |26954 | | | |Limpopo |22344 | | | |Mpumalanga |9581 | | | |Northern Cape |3299 | | | |North West |10981 | | | |Western Cape |5288 | | | |Total |123,392| | |

  The Grant is being discontinued over the medium term. However, the
 Committee noted that general poor performance in the use of the Grant
 amongst provinces and the implementation over the final year should be
 effectively monitored.

1. Hospital Management and Quality Improvement Grant

   The purpose is to transform hospital management and improve quality of care in line with national policy. In future the Grant is to be reviewed within the context of the National Health Funding Policy. The Grant is meant to fund the organisational development part of the revitalisation of hospitals.

   The Committee noted that the transfers of funds were delayed with the exception of Northern Cape, Gauteng and Mpumalanga provinces.

The MTEF allocation is as follows:

  The nominal total allocation increases by 6% in the short term
 (2006/07). However, it declines by -1% over the medium term.

Committee concerns

  The Committee expressed concern on the perception that Conditional
 Grant’s requirements are continuously being administratively burdensome
 and costly. It recommends that this issue be attended to as urgently as
 possible, within the context of the Division of Revenue 2005/06
 requirements.

  The Committee acknowledged and recognised that with the monitoring
 measures suggested for each grant, the Department is ready for the
 financial year 2005/06, grants allocations.

  The Committee recommended that monitoring mechanisms under each
 conditional grant should consistently be followed through in the
 oversight process.

7.5 The National Department of Housing briefing

  The Committee acknowledged and recognised that with the monitoring
 measures suggested for each grant, the Department is ready for the
 financial year 2005/06, grants allocations.

Committee Concerns

  The new housing policy shifts responsibility for housing to
 accredited Municipalities, particularly Metropolitan and major urban
 category B Municipalities.

• The Committee is concerned about the capacity of certain
  Municipalities to deliver this task. Oversight visits will be made to
  areas where Municipalities are already carrying out this task such as
  the Sol Plaatjie Municipality in the Northern Cape.

• The Committee noted that the cost of doing government business should
  continuously form part of programmes implementation. This includes
  reducing time delays in the building and allocation of the
  Reconstruction and Development Houses (RDP).

Report to be considered.

                        TUESDAY, 31 MAY 2005

ANNOUNCEMENTS

National Council of Provinces

1. Messages from National Assembly to National Council of Provinces in respect of Bills passed by Assembly and transmitted to Council

   (1) Bill passed by National Assembly on 31 May 2005 and transmitted for concurrence:

   (i) Appropriation Bill [B 7 – 2005] (National Assembly – sec 77)

   The Bill has been referred to the Select Committee on Finance of the National Council of Provinces.

2. Referrals to committees of papers tabled

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

 (1)    The following paper is referred to the Select Committee on
     Finance for consideration:


   Report on the Budget and Strategic Plan of the Auditor-General for
     2005/06 [RP 38 of 2005].


 (2)    The following papers are referred to the Select Committee on
     Finance for consideration and report:


        (a)   Agreement between the Government of the Republic of South
          Africa and the Government of the Republic of Turkey regarding
          Mutual Assistance between their Customs Administrations,
          tabled in terms of section 231(2) of the Constitution, 1996.


        (b)   Explanatory Memorandum to the Agreement between the
          Government of the Republic of South Africa and the Government
          of the Republic of Turkey regarding Mutual Assistance between
          their Customs Administrations.


        (c)   Agreement between the Republic of South Africa and the
          Republic of Turkey for the Avoidance of Double Taxation and
          the Prevention of Fiscal Evasion with respect to Taxes on
          Income, tabled in terms of section 231(2) of the
          Constitution, 1996.


        (d)   Explanatory Memorandum to the Agreement between the
          Republic of South Africa and the Republic of Turkey for the
          Avoidance of Double Taxation and the Prevention of Fiscal
          Evasion with respect to Taxes on Income.


        (e)   Convention between the Government of the Republic of South
          Africa and the Government of the Republic of Gabon for the
          Avoidance of Double Taxation and the Prevention of Fiscal
          Evasion with respect to Taxes on Income, tabled in terms of
          section 231(2) of the Constitution, 1996.


        (f)   Explanatory Memorandum on the Convention between the
          Government of the Republic of South Africa and the Government
          of the Republic of Gabon for the Avoidance of Double Taxation
          and the Prevention of Fiscal Evasion with respect to Taxes on
          Income.


        (g)   Convention between the Government of the Republic of South
          Africa and the Government of the Republic of Ghana for the
          Avoidance of Double Taxation and the Prevention of Fiscal
          Evasion with respect to Taxes on Income and on Capital Gains,
          tabled in terms of section 231(2) of the Constitution, 1996.


        (h)   Explanatory Memorandum to the Convention between the
          Government of the Republic of South Africa and the Government
          of the Republic of Ghana for the Avoidance of Double Taxation
          and the Prevention of Fiscal Evasion with respect to Taxes on
          Income and on Capital Gains.


        (i)   Convention between the Government of the Republic of South
          Africa and the Government of the Democratic Republic of Congo
          for the Avoidance of Double Taxation and the Prevention of
          Fiscal Evasion with respect to Taxes on Income, tabled in
          terms of section 231(2) of the Constitution, 1996 (Act No 108
          of 1996).


        (j)   Explanatory Memorandum on the Double Taxation Convention
          between the Government of the Republic of South Africa and
          the Democratic Republic of the Congo.


        (k)   Agreement between the Government of the Republic of South
          Africa and the Government of the Kingdom of Norway regarding
          Mutual Assistance between their Customs Administrations,
          tabled in terms of section 231(2) of the Constitution, 1996
          (Act No 108 of 1996).


        (l)   Explanatory Memorandum on the Customs Agreement between
          the Republic of South Africa and the Kingdom of Norway.


 (3)    The following papers are referred to the Select Committee on
     Education and Recreation for consideration:


        (a)   Strategic Plan of the Department of Education for 2005 to
          2010.


        (b)   Strategic Plan of the Department of Arts and Culture for
          2005 to 2010.


 (4)    The following paper is referred to the Select Committee on
     Social Services:


   A list of approved early naturalisation applications in terms of
     section 5(9) of the South African Citizenship Act, 1995 (Act No 88
     of 1995).


 (5)    The following papers are referred to the Select Committee on
     Security and Constitutional Affairs:


        (a)   Proclamation No R.13 published in Government Gazette No
          27406 dated 22 March 2005: Commencement of the Judicial
          Matters Second Amendment Act, 2003 (Act No 55 of 2003).


        (b)   Government Notice No R.250 published in Government gazette
          No 27406 dated 22 March 2005: Amendment of Regulation in
          terms of the Judges Remuneration and Conditions of Employment
          Act, 2001 (Act No 47 of 2001).


        (c)   Government Notice No R.251 published in Government Gazette
          No 27406 dated 22 March 2005: Amendment of Mediation in
          Divorce Matters Regulation in terms of the Mediation in
          Certain Divorce Matters Act, 1987 (Act No 24 of 1987).


        (d)   White Paper on Corrections in South Africa – February
          2005.


 (6)    The following papers are referred to the Select Committee on
     Security and Constitutional Affairs for consideration and report:


        (a)   Report on the provisional suspension from office of senior
          magistrate Mr M J S Nhleko.


        (b)   Report on the provisional suspension from office of
          magistrate Mr R Ameer.


        (c)   Report on the provisional suspension from office of
          magistrate Mr M K Chauke.


        (d)   Report on the provisional suspension from office of
          magistrate Mr M S Makamu.


        (e)   Report on the provisional suspension from office of
          magistrate Mr L D Monageng.


        (f)   Report on the provisional suspension from office of
          magistrate Mr S E Tebe.


 (7)    The following paper is referred to the Select Committee on Local
     Government and Administration and the Select Committee on Finance:


   General Report of the Auditor-General on Provincial Audit Outcomes
     for 2003-2004 [RP 42-2005].


 (8)    The following papers are referred to the Select Committee on
     Public Services for consideration and report:


        (a)   Accession to the Convention for the Suppression of
          Unlawful Acts against the Safety Maritime Navigation and to
          the Protocol for the Suppression of Unlawful Acts against the
          Safety of Fixed Platforms Located on the Continental Shelf,
          tabled in terms of section 231(2) of the Constitution, 1996
          (Act No 108 of 1996).


        (b)   Explanatory Memorandum to the Accession to the Convention
          for the Suppression of Unlawful Acts against the Safety of
          Maritime Navigation and to the Protocol for the Safety of
          Unlawful Acts against the Safety of Fixed Platforms Located
          on the Continental Shelf.


 (9)    The following paper is referred to the Select Committee on
     Public Services:


   Bilateral Air service Agreement between the Government of the
     Republic of South Africa and the Great Socialist People’s Libyan
     Arab Jamahiriya for Scheduled Air Services Between their
     Territories and Beyond, tabled in terms of section 231(3) of the
     Constitution, 1996 (Act No 108 of 1996).

TABLINGS

National Assembly and National Council of Provinces

1. The Minister of Finance

   Government Notice No 868 published in Government Gazette No 27636 dated 30 May 2005: Municipal Supply Chain Management Regulations in terms of the Local Government: Municipal Finance Management Act, 2003 (Act No 56 of 2003).

2. The Minister for Provincial and Local Government

   Strategic Plan of the Department of Provincial and Local Government for 2005 to 2010.

COMMITTEE REPORTS

National Council of Provinces

1. Report of the Select Committee on Local Government and Administration on the African Union Convention on the Prevention and Combating of Corruption, dated 31 May 2005:

   The Select Committee on Local Government and Administration having considered the request for approval by Parliament of the African Union Convention on the Prevention and Combating of Corruption, referred to it, recommends that the House, in terms of Section 231(2) of the Constitution, approve the said Protocol.

   Report to be considered.

4 Section 26 of the Bill

5 Sections 15 and 30 of the Bill

6 Sections 33, 34 and 35 of the Bill

7 Section 31 of the Bill

8 Sections 13, 14 and 37 of the Bill