WEDNESDAY, 29 MARCH 2006 __

                PROCEEDINGS OF THE NATIONAL ASSEMBLY

                                ____

The House met at 14:05.

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

ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS – see col 000.

                          NOTICES OF MOTION

Dr J T DELPORT: Madam Speaker, I hereby give notice that I shall move on behalf of the DA:

That the House debates Rule 1114, which gives the Speaker of the NA the right to reject oral questions directed at the President in such a way that the President, as head of government, cannot properly be held accountable.

Mnr R J KING: Agb Speaker, hiermee gee ek kennis dat ek namens die DA sal voorstel:

Dat die regering se beleid aangaande landelike veiligheid, asook die implikasies daarvan, bespreek word. Dankie.

(Translation of Afrikaans notice of motion follows.)

[Mr R J KING: Hon Speaker, I hereby give notice that I shall move on behalf of the DA:

That the government’s policy regarding rural safety, as well as its implications, be discussed. Thank you.]

Mev D VAN DER WALT: Speaker, hiermee gee ek kennis dat ek namens die DA op die volgende sittingsdag sal voorstel:

Dat die Huis sy teleurstelling uitspreek oor die onvermoë van die Minister van Kuns en Kultuur om, soos onderneem, ‘n nuwe raad vir die Nasionale Kunsteraad voor einde November 2005 aan te gestel het. (Translation of Afrikaans notice of motion follows.)

[Mrs D VAN DER WALT: Speaker, I hereby give notice that on the next sitting day I shall move on behalf of the DA:

That the House expresses its disappointment regarding the failure of the Minister of Arts and Culture to, as undertaken, appoint a new board for the National Arts Council before the end of November 2005.]

         SOLIDARITY WITH THE COMMUNITY OF TAUNG AFTER FLOODS

                         (Draft Resolution)

The DEPUTY CHIEF WHIP OF THE MAJORITY PARTY: Madam Speaker, I hereby move without notice:

That the House –

(1) notes that more than nine hundred houses were destroyed recently in villages in the Taung district, North West province, due to floods;

(2) further notes that the Taung municipality visited the affected areas and delivered tents, blankets and food-parcels to the affected communities;

(3) commends the efforts made by the Taung municipality and the South African National Defence Force to ease the pain of the community; and

(4) conveys its sympathies to the communities of Taung.

Agreed to.

         SYMPATHY WITH FIRE VICTIMS IN CENTRAL JOHANNESBURG

                         (Draft Resolution)

The CHIEF WHIP OF THE OPPOSITION: Madam Speaker, I hereby move without notice:

That the House –

(1) notes the devastating fire in a building in central Johannesburg where 12 people were killed and 33 injured;

(2) expresses its deepest sympathy to the families of the victims; and

(3) wishes the injured a speedy recovery.

Agreed to.

          TRAWLER UMLINDI CAPSIZED NEAR SLANGKOP LIGHTHOUSE

                         (Draft Resolution)

The DEPUTY CHIEF WHIP OF THE MAJORITY PARTY: Madam Speaker, I hereby move without notice:

That the House –

 1) notes that on Monday, 27 March 2006, the trawler Umlindi capsized
    off Slangkop lighthouse in bad weather with five crewmen on board;


 2) recalls that this is the 12 drowning in eight months that has
    befallen the fishing community of Hout Bay;


 3) commends the efforts of the National Sea Rescue Institute (NSRI)
    and the South African Police Service’s divers, who worked
    tirelessly to recover the bodies of the crew members; and


 4) conveys its deepest sympathy to the families of the Umlindi crew.

                         APPROPRIATION BILL

Debate on Vote 32 – Trade and Industry:

The MINISTER OF TRADE AND INDUSTRY: Madam Speaker, Ministers, Deputy Ministers, members of the NA, MECs, heads of departments, officials of the DTI, and the Council of Trade and Industry Institutions, leaders of organised business and labour, distinguished guests, and ladies and gentlemen, by all accounts our economic performance is impressive and is a source of inspiration for our nation and reinforces our belief that we can achieve our ideal of a better life for all.

Our GDP growth was close to five per cent, business and consumer confidence reached new heights, job creation is starting to pick up, and investment inflows are steadily increasing. However, to sustain this performance and improve on it, we must pay attention to the conditions and structural changes that are necessary to support current and future economic growth.

The fact is that current growth is based on the current commodity boom, as well as positive consumer sentiment, both of which can be transitory. We are now at that critical juncture that requires us to take key decisions to prepare the ground for quality growth that is sustainable.

The Department of Trade and Industry has already been active on a number of fronts in regard to this challenge. The DTI supports enterprises; dispenses financial support and incentives; it continually seeks to promote competitiveness of our industries; promotes empowerment for both black people and women; it undertakes supportive regulatory initiatives, such as in respect of consumer protection and corporate law, and it seeks to influence the global trading environment for our enterprises through the work we do at the World Trade Organisation, and in particular the current Doha round, as well as through a range of bilateral trade agreements.

We fully appreciate that the activities of the DTI will need to be strengthened, broadened and properly resourced in order to more effectively fulfil its mandate in realising a better life for all. Indeed, considerable challenges remain, not least continuing unemployment and underdevelopment. Thus, in the year ahead the focus will be on unlocking the potential thus far demonstrated by this economy by addressing some of the main constraints to growth. In this regard the department has been central in the process of formulating the Accelerated and Shared Growth Initiative, Asgisa, which is being championed by the Deputy President.

As is well known, Asgisa is a strategy involving targeted interventions to overcome key constraints in the macroeconomic environment, in infrastructure and logistics provision, in skilled labour availability, in the competitive environment and cost structure of the economy, as well as in the regulatory environment, and in the institutional capacity of government to deliver.

In the immediate period ahead the department will work with the rest of government in overcoming these challenges. More specifically, the DTI will focus on those dimensions of Asgisa that deal with industrial development, sector strategies, enterprise development, as well as second economy initiatives, more broadly.

Welcome, Deputy President, if I may.

We will also support Asgisa initiatives on skills and public investment, including through our role as the co-ordinating ministry and department in the economic and investment cluster. Our work for 2006-07 will be guided by five integrated strategic objectives underpinned by a number of key projects and initiatives: firstly, promoting co-ordinated implementation of our commitments to Asgisa, including the contribution that the DTI’s agencies can make in this regard; secondly, promoting direct investment and growth in the industrial and services economy; thirdly, promoting broader participation, equity and redress in our economy; fourthly, raising the level of exports and promoting equitable global trade, and, finally, contributing towards the development and regional integration of Africa within the Nepad framework. It is clear from these objectives that the mandate of the DTI is very broad, indeed, and the department has an important contribution to make to the work of growing the economy.

At this point I would like to outline what the work of the DTI will be in fulfilment of our mandate, as well as in support of Asgisa. This year will see the completion of the process of developing an overarching industrial policy framework, harnessing existing capacity of our industries and unlocking their potential, and covering manufacturing, selected primary as well as services sectors.

We believe that a robust industrial policy is necessary to fast-track industrial development. In this regard our human and financial resources will be more focused on a narrower range of high-impact sectors. Increased financing for industrial development, including improved incentives, will be part of our focus of going forward.

Within this broad industrial policy framework we will also accelerate the work we have been doing in respect of key priority sectors through the customised sector programmes. These will be strengthened to identify and act upon the constraints to growth and employment. The process has involved extensive inputs and consultations over recent months. Deputy Minister Davies will expand on this theme in his input.

Included in our work on the industrial policy framework is a focus on services and regional industrial development. We see services as a crucial part of our growth and employment creation efforts. Services currently represent almost 70% of South Africa’s employment and output. Uneven development of our economy remains a challenge, hence we want to put greater emphasis on the generation of industrial activity in underdeveloped parts of our country, drawing on the comparative advantages of these regions and working with provincial governments.

It is clear that an effective industrial development strategy will require adequate and appropriate financial resourcing and therefore work is currently under way to review the package of incentives with a view to sharpening their focus, as well as to securing increased funding. Sustainable growth requires a continued focus on competitiveness and competition, which are necessary to unlock the potential of the economy.

It has long become clear that downstream value addition or beneficiation of raw materials is constrained by high-input costs, often arising from anti- competitive pricing practices of monopolistic enterprises. Similar constraints exist in services. These factors have prompted, amongst other initiatives, a review of competition policy and measures to address import parity pricing and investigation into beneficiation activities.

As regards import parity pricing, I wish to take this opportunity to outline some of the measures that Cabinet has adopted in respect of this matter. It is government’s wish to see a phasing out of substantive price discrimination between domestic and export customers in key intermediate input sectors in the economy. This will entail a number of changes, namely that the Competition Act will be strengthened to better deal with the high level of concentration in certain sectors of the economy and attendant uncompetitive outcomes. Secondly, any future fiscal support by government or public entities will be dependent on adoption of non-discriminatory pricing between the domestic and export markets.

Import tariff protection on product lines engaged in IPP will be removed and contingent protection legislation will be amended to ensure that anti- dumping and countervailing duties are not used as a form of protectionism to inhibit import competition in such commodities. Government will develop a state-owned enterprises pricing and procurement framework which links the pricing and procurement practices of SOEs to market behaviour of strategic input industries. Government is in the process of developing downstream beneficiation incentives to help address other constraints and the historical underdevelopment of key downstream beneficiation sectors, particularly the metal fabrication, machinery and equipment and plastic sectors.

As outlined above, the measures to deal with IPP form part of a broader strategy of promoting downstream beneficiation. We are confident that the co-ordinated approach to growing domestic and regional demand will generate profitable and sustainable growth and employment in both upstream and downstream beneficiation industries.

With respect to the steel industry, there have been ongoing investigations and discussions that are still under way. Specific discussions with Mittal Steel SA are still under way. However, after careful review and in line with our policy of bringing down the cost of key manufacturing inputs, it has been established that there is no longer a need for a five per cent import tariff on certain primary carbon and stainless steel products and that this duty will be removed with immediate effect.

If I may just say that we would like to give a very clear indication that there’s going to be ongoing discussions that will take place with Mittal Steel SA, which is one of the major players that has a very strong relationship with the issue we are trying to address. Mittal Steel SA has placed certain proposals on the table; we are in ongoing discussion on those matters.

Our work on sectors constitutes the greatest contribution of the department to advancing Asgisa. In this regard we will prioritise those sectors that are labour-absorbing and in which South Africa has a comparative advantage, stimulating investment, employment and our competitive capacity, both in the international and domestic markets. These include business-process outsourcing and tourism. Further, we will also focus on chemicals, creative and cultural industries, metals, agroprocessing and clothing and textiles.

I would now like to deal with some topical issues in relation to some of the key sectors that have been reported on in the media. Regarding the automotive industry, I wish to reiterate government’s continued commitment to supporting this industry, which has displayed impressive performance, creating jobs, attracting investment, growth and exports and integrating the domestic industry into global manufacturing operations.

The current support programme for the industry, the Motor Industry Development Programme, MIDP, is undergoing a review with an objective to seek sustainable ways of maintaining and improving this impressive performance and ensuring that our support is on par with international norms and standards. The review of the MIDP will be finalised in a matter of the following few months and any changes will be communicated to all stakeholders at that time.

Regarding the clothing and textile sector, it has always been our view that the challenges of the sector have to be addressed in a comprehensive manner focusing on both immediate issues, such as import surges, as well as long- term competitiveness. For this reason we attach great importance and urgency to the work of finalising a customised sector strategy for clothing and textiles that will seek to secure the long-term sustainability of the sector. This has been a stakeholder-driven process and, largely, the work on developing a customised sector strategy for the clothing and textile sector has been completed.

However, I do intend to convene a meeting shortly, within the next few weeks, of all the stakeholders in order to do a final round of consultation on the customised sector strategy for the clothing and textile sector. On that occasion we will deal with all of the outstanding issues in the customised sector programme, and on that occasion I will also unveil the draft agreement that we have negotiated with the People’s Republic of China in respect of import relief in the clothing and textile sector.

In terms of immediate support, I am glad to be able to use this opportunity to announce that the duty credit certificate scheme will continue for a 24- month period – two years – retroactive as from 1 April 2005. The current practice on tradeability of this duty credit certificates will be allowed to continue on a Sacu-wide basis with effect from 1 April 2005 up until the end of this month. In other words, all those duty credit certificates that would have accumulated during the course of 2005 will allow free tradeability on those duty credit certificates. But, effective from 1 April 2006 up until the end of March 2007, the tradeability of the certificates will be restricted to manufacturers only.

Our work on sectors will also inform our approach to investment and export- promotion efforts. We believe that not only does the level and rate of investment in the economy need to increase, the type of investment that takes place needs to be more labour-absorbing if significant numbers of new jobs are to be created.

Similarly, greater efforts are required to boost flagging manufacturing exports and lock into new markets for our products and services. In both exports and investments we will unveil, during the course of this year, new plans, drawing on our lessons and expert advice from a range of sources, including multilateral agencies. And, as I speak, there is a seminar taking place in Johannesburg with the participation of the World Bank, as well as a range of stakeholders in South Africa – investors in particular – that is looking at developing an investment strategy for South Africa. This work will build on the work that we have done on the investment climate survey, which identified our investment potential, as well as the constraints that need to be overcome.

A central pillar of our work will be with respect to enterprise development, focusing on the small and medium enterprise sector, as well as co-operatives. This work is informed by our belief that enterprise development is a key vehicle for broadening economic inclusion and participation. This is more important in view of the challenges posed by the marginalisation of the second economy. Two areas will receive greater emphasis as regards enterprise development, namely financial support and non-financial advice.

It is worth noting the speedy turnaround achieved by the National Empowerment Fund, which is now properly established and functioning, and is succeeding to increase the level of disbursements. As at the end of February 2006, the fund had concluded 48 new deals and 60 disbursed investments to the value of R240 million. Financial support for small, medium and micro enterprises is attracting greater interest in the market, as demonstrated by the IDC making R1 billion available for low-interest loans to SMMEs and the initiative by Khula and Business Partners to create an instrument for SMME start-up funding focusing on the provision of loans in the area up to R250 000, particularly to black enterprises.

The Small Enterprise Development Agency will facilitate dedicated non- financial support to small businesses in priority sectors, including those identified in Asgisa. This will include the provision of crucial business development information to small businesses, as well as mentoring and hand- holding. Progress in this work will depend on the roll-out of the Seda network, which we are giving the highest level of attention, and it is also being assisted by the dedication of Deputy Minister Thabete. She will expand more on some of the work that is taking place in this area.

Flowing out of Asgisa, our work on small-enterprise development will also involve two important initiatives. The first is to ensure that government honours its commitment to pay small business service providers within 30 days, Deputy President. The second relates to the identification of products and services that government will procure from SMMEs alone. The DTI has been assigned the responsibility to lead these initiatives in conjunction with the National Treasury. We will report on this work during the course of this year. With regard to microfinance, the highlight of our work will be the launch of the Apex Fund as a trading entity as from 1 April 2006.

We are encouraged by the progress that has been made in respect of black economic empowerment as evidenced by the increase in the number of deals and in the breadth of their coverage, which includes sectors like women and communities. All of this underscores the urgency which we will attach to the conclusion of the work on the codes of good practice.

On the regulatory front we are also pleased with the profile we are giving to consumer protection as signified by the Consumer Bill, which will be introduced in Parliament in the second quarter of this year and the establishment of the National Credit Regulator.

What has been outlined is a wide-ranging and daunting agenda. It begs the question of the institutional, human and financial resources that will be necessary to ensure its successful implementation. A key requirement in this regard is a functioning and effective department. In the immediate period ahead we will pay greater attention to building the capacity of the Department of Trade and Industry, including leveraging our partners’ and stakeholders’ energies and capacity in support of this work.

In better resourcing the DTI special focus will be given to both the number and quality of human resources, as well as strengthening the top management of the department, and in this regard I’m pleased to announce that I have initiated the process of appointing a director-general, which we hope we will be able to finalise in a short while. We will also be dealing with the issue bringing on board high-level support for the Director-General of the Department of Trade and Industry, and we will communicate accordingly in that particular regard.

Finally, as we work towards creating sustainable employment by promoting vibrant manufacturing and services sectors in the economy, we are abundantly aware of the necessity to act in concert. Therefore let us work together to achieve these ambitious and necessary goals.

I would like to thank Members of Parliament and our portfolio and select committees for their keen interest and involvement in the work of the department, and to thank Nedlac constituencies, noting the improvement in the working relationship and encouraging participants to continue to build on the gains we have made. I’d like to thank the Deputy Ministers, who are exceedingly hard working, the senior management and staff in the department, and leadership of the various trade and industry institutions for their hard work and dedication. I’d like to thank the acting Director- General Tshediso Matona for his continued and tireless devotion to enhancing the impact of the department.

Madam Speaker, I’d like to ask the House to support the efforts of the DTI by approving its budget of R3, 665 million for this financial year. [Applause.]

Mr B A D MARTINS: Hon Madam Speaker, hon Deputy President, hon Minister and Deputy Ministers of Trade and Industry, esteemed members, ladies and gentlemen, emanating from the contribution of the hon Minister of Trade and Industry, it is clear that the department is guided by the policy direction and political mandate, as expressed in the state of the nation address and the obligations of government embodied in legislation and oversight by Parliament.

The department’s budget sets out priorities and trade-offs for the next three years and the performance targets for each of those three years. In keeping with the ANC government’s objective of building a single and integrated economy that benefits all, the department has contributed positively to the integration, growth and stabilisation of the economy.

The mandate given to the ANC-led government by the electorate, however, requires the faster realisation of a better life for all. In keeping with this objective, the accelerated and shared growth initiative identifies and seeks to clear binding constraints to higher economic growth, and it seeks to commit resources to fighting poverty and unemployment while growing the economy and delivering social services. It is in this regard that the realisation of the strategic objective of the Council of Trade and Industry Institutions (COTII) is important. These include, firstly, the promotion of broader participation, equity and redress in the economy; secondly, raising the level of exports and promoting equitable global trade; thirdly, promoting direct investment and growth in the industrial and services economy with particular focus on employment creation; and, fourthly, contributing towards the development and regional integration of the African continent within the Nepad framework. Therefore COTII has a great responsibility to meet these obligations, and to deliver quality products and services to clients and stakeholders.

We also remain mindful, however, that the department’s role in the realisation of economic prosperity depends not only on funds allocated and the scope of services provided, but also on the effectiveness of service provision, the quality of planning and implementation, and the appropriateness of the regulatory framework. There will thus always be new challenges in each of these areas.

Forthcoming legislation and regulation will include, amongst others, the consumer protection Bill, the corporate law reform Bill, broad-based black economic empowerment codes of good practice, co-operatives regulation and amendments to the Competition Act. In keeping with the overall objectives of the department, investment promotion correctly remains a key focus. Investment levels in the economy remain below 25% of the GDP benchmark required for sustained acceleration in economic growth rates. Not only does the level and rate of investment in the economy need to increase, but the type of investment that takes place also needs to be more labour-absorbing, if significant numbers of new jobs are to be created.

The recently published research results of the Global Entrepreneurship Monitor state that, whilst the policy objectives which underpin small, medium and micro enterprise development in South Africa are sound and contribute to economic growth and job creation, and act as a vehicle for the redistribution of wealth and opportunity, often, the implementation of these different objectives lead to conflicting outcomes.

The report argues that, despite the fact that SMMEs are expected to deliver jobs, it is difficult to identify an SMME programme that is dedicated to employment creation. The report further argues for a shift of focus towards programmes that support entrepreneurs who create jobs. I am sure that members of the portfolio committee and stakeholders will be interested in the department’s response to this report.

The matter of Mittal Steel South Africa that is presently before the Competition Tribunal, in which Harmony and DRD Gold allege that Mittal Steel South Africa is charging its customers for nonexistent additional costs, brings to the foreground the need for DTI to provide leadership and clarity on import parity pricing. This becomes crucial at present, when South Africa has plans for significant infrastructure development. It is imperative that the steel industry and other industries that use similar pricing structures should come under the spotlight of the competition authorities, lest these shackle South Africa’s economic growth.

In order for the department to effectively carry out its mandate, it will be important for it to fill the vacancies within the department and also to address its capacity challenges. It is thus important to appoint a director- general and deputy directors-general as soon as possible for those agencies where this has not yet been done, in order to provide vital leadership.

The ANC supports the DTI’s budget because it provides a sound framework for meeting the challenges that confront the nation. I thank you. [Applause.]

Dr P J RABIE: Hon Speaker, hon Deputy President, hon Minister, hon members, a number of factors have recently had an impact upon business confidence in South Africa. Allow me to mention a few.

Mittal Steel is at present in front of the Competition Tribunal following complaints by Harmony and DRD Gold about its use of the import parity pricing system, which basically means that a producer charges users of steel what they would have to pay if they were importing it, including estimated transport and storage costs. The allegation against Mittal Steel is a very serious one. The question remains: Can producers be allowed to exercise monopoly power to determine prices in a developing country like South Africa? The high prices charged by Mittal to domestic firms impact negatively on South Africa’s industries, such as mining or the automotive sector, and so have a knock-on effect that is felt throughout the economy. This reduces our overall competitiveness and harms our growth prospects.

The DA thus welcomes the efforts made by the competition authorities to clamp down on import parity pricing. At the same time, whatever our policy interventions may be, it is important that the price- signalling system remains intact so as to ensure efficient allocation of resources within the South African economy.

The Western Cape in particular suffered a number of electrical power failures recently, which had a negative effect upon a number of industries. Grocers lost meat and other produce, and our petrol refineries lost out on days of production because of power shortages.

The adequate supply of electricity is a key prerequisite for sustained future economic growth. Having said this, the DA welcomes the introduction of the two proposed gas turbines to be built at Mossel Bay and Atlantis. The participation of the private sector regarding the running and financing of the gas turbines is welcomed. Indeed, the DA considers the eventual privatisation of parastatals as an essential component of our growth strategy.

In this regard, at present the cost of communications in South Africa is substantially higher than the international benchmark, which, in turn, increases the cost of doing business. As such, we would support greater efforts on government’s behalf to bring down the cost of telecommunications and, in particular, broadband access.

Listed companies are accountable to shareholders. In countries such as South Africa, France and Russia the bulk of electricity is generated by parastatal units. In this regard, I find some statistics presented by Finweek magazine highly disturbing. Why is it that Korea, Japan, Germany and Belgium have employee-cost-to-turnover percentages of 8%, 12%, 6% and 5%, while our own employee-cost-to-turnover percentage is 22%? Using this measure as a simple yardstick of efficiency gives us, I believe, some cause for concern.

The South African economy weathered the rise in oil prices in 2004 and 2005 and our economic growth accelerated. The rand remained relatively strong. The further relaxation of exchange controls, coupled with the government’s Accelerated and Shared Growth Initiative, Asgisa, benefited a wide sector of industries mainly as a result of infrastructure expansion by Transnet, Eskom and others.

The South African economy, however, will be deeply affected by the crisis regarding the Doha negotiations, which, in essence, is not technical but political. Developed countries regard globalisation and the ascendant economies of China and India as threats, which diminish their inclination to liberalise trade.

The South African domestic market is relatively small. Increased competition from low-cost producing countries such as China and India have had an adverse effect upon the output of local producers in some industries, particularly textiles, and I think the hon Minister referred to that as well.

Since the termination of the Multifibre Agreement in 2005, South African producers have alleged that prices of textile imports are sometimes below the prices of raw materials. Clearly, Minister, this is not acceptable in the light of the fact that thousands of jobs were lost in the textile industry in the Western Cape in the past decade. Many South Africans would appreciate greater clarity on government’s plans to help this ailing sector of our economy.

The Portfolio Committee on Trade and Industry has had a number of submissions regarding policies on small, medium and micro enterprises. They can be summarised into three objectives, namely contributing to economic growth, creating jobs, and acting as a vehicle for the redistribution of wealth and opportunity for individuals that hail from previously marginalised communities. There is a misconception that SMME development will eradicate poverty and substantially reduce unemployment. The real situation is that not all entrepreneurs are equal when it comes to job creation. In effect, less than 3% of necessity businesses, which can be categorised as survivalist businesses, and most microbusinesses are likely to create more than six jobs. The reasons for the unequal potential for job creation are complex, but the unequal access to education, finance and opportunity may be contributing factors. The Global Entrepreneurship Monitor, a programme in which South Africa participated in the past five years, is of the opinion that education is the key to entrepreneurship, job creation, economic growth and poverty alleviation. I think we should really investigate the future prospects of our present education system.

South Africa’s latest position on the world stage is 25th out of 35 countries regarding GEM data, which is reason for grave concern if we take into account that our present rate of unemployment is approximately 30%.

Countries that experienced strong economic growth in the past three decades seriously addressed their skills shortages. The Engineering Council of SA estimates that between 3 000 and 6 000 civil engineers, technologists and technicians will be needed for our present infrastructure expansion and improvement programme. The DA appeals to all role-players to recruit suitably qualified individuals to fill this alarming shortage. The DA also appeals to government to accept and implement internationally accepted economic norms and standards and not to deviate from the principle of willing buyer, willing seller.

Corruption in any form cannot be tolerated. The Oilgate scandal, the nondisclosure of interests, and allegations regarding payments to prominent ANC officials related to a prominent deceased mining magnate are doing untold damage to investor confidence. We need less corruption, a more independent judiciary, fair labour laws, more skilled immigration and more competition. This will lead to future sustained economic growth.

Daar is ‘n legio van veranderlikes wat ekonomiese groei kan inhibeer: die sosiomaatskaplike gevolge van MIV op die fiskus rakende medikasie; maatskaplike onderhoud van mense; verlies aan geskoolde werkers; die wyse waarop swart ekonomiese bemagtiging in sekere sektore geïmplementeer word, waar ‘n klein groepie individue met noue bande met die ANC bevoordeel word ten koste van die breë werkerskorps, en daar sal hieroor herbesin moet word.

In die breë steun die DA die begroting mits daar indringende proaktiewe stappe gedoen word om strukturele hindernisse betreffende ekonomiese groei uit die weg te ruim. Ek dank u. [Applous.] (Translation of Afrikaans paragraphs follows.)

[The variables that can inhibit economic growth are legion: the socioeconomic consequences of HIV on the fiscus with regard to medication; social support of people; loss of skilled workers; the way in which black economic empowerment is implemented in certain sectors, where a small group of individuals with close ties to the ANC is privileged at the expense of the broader workers’ corps, and this will have to be reconsidered.

Broadly speaking the DA supports the budget, as long as proactive steps are taken incisively to eradicate structural challenges related to economic growth. Thank you. [Applause.]]

Mr S J NJIKELANA: Somlomo, malungu ePalamente, uluntu jikelele, nani maqabane, … [Madam Speaker, hon members, comrades and the general public …]

… the focus of my input is on the Council of Trade and Industry Institutions, known as the COTII group. I’m referring to the 17 agencies under DTI, including, Seda, Khula, the Industrial Development Corporation, the Competition Commission, the SA Bureau of Standards, etc.

Throughout the current dispensation the ANC has been steadfast in creating and refining policy guidance as well as overall leadership in economic transformation. The president of the ANC confirmed such on 8 January 2006, when he stated that, and I quote: … we should continue to highlight the fact that among our critical tasks during the current phase of the national democratic revolution are:

increasing the rate of economic growth and development; the reduction of the levels of unemployment through job creation, the development of micro, small and medium enterprises and skills provision;

• I will dwell on that –

  reducing the levels of poverty and racial, gender and spatial inequality …

The President stated in the state of the nation address this year that, and I quote:

Our experience with regard to the development of this sector indicates that we must pay particular attention to the issues of access to capital, entrepreneurial training, assistance with marketing, and the development of co-operatives.

That is the reason the introduction, development and refinement of the COTII group, as one of the government’s development tools for economic transformation, has, befittingly, been responding and addressing the above challenges for the past decade. DTI has admirably and constantly sharpened and improved the effectiveness and impact of those agencies by refining their programmes and policies, as well as giving them as many resources as is practically possible.

The budget of DTI has taken good strides in ensuring such effectiveness, as we have witnessed an annual growth of 32%, from R500 million in the year 2002-03 to R1,2 billion this current financial year. I refer to the COTII group only, Madam Speaker.

COTII agencies’ focus on the second economy has, through support and development programmes, been able to further ensure that broader economic participation is promoted, that the currently skewed equity ownership is redressed, and that market distortions, for example, are corrected. I could give a few more examples, but for lack of time.

COTII regulatory agencies have also been able to do their best in responding to the challenges towards the creation of an enabling environment for economic development. Our economic practices, as in any other economy, have to ensure compliance with standards and protection of consumers and environmental sensitivity, as espoused in the resolutions of the World Summit on Sustainable Development, which was held here in South Africa. I can confirm that our regulatory agencies have done their best in responding to and addressing those areas.

Ke, bantu bakowethu, iZizi elimnyama neenkomo zalo liphinde latsho ukuba: [Fellow countrymen, the son of the Zizi clan has reiterated the statement that …]

For Asgisa to succeed, it is clear that the machinery of the state should function effectively and efficiently.

We can, therefore, attest to the readiness of the COTII agencies to respond to the directives of Asgisa, as has been highlighted by the remoulding of some of the members of COTII agencies into Seda, the Small Enterprise Development Agency, to give one example.

The Medium-Term Expenditure Framework estimates indicate a growth rate of 3,7% per annum, which will peak to R3 billion in 2008-09, another confirmation of readiness to take up the directives of Asgisa.

The contribution of COTII agencies to international trade and foreign direct investment has also been remarkable. It was augmented by the positive attitude and constantly growing confidence in South Africa and its government’s ability to steer its economy out of the apartheid-caused doldrums.

The realisation of broad-based black economic empowerment has been fairly integrated in the work of the COTII group, as evidenced in their annual reports.

Kodwa ke, mawethu, masivume ukuba kuse kude ngaphambili; asikaphum’ ehlathini. Ngoko asikabi nakho ukuzingomba isifuba okwangoku. [We should accept the fact that the road ahead is long. We have not yet made it. We should move cautiously before we can say that we have accomplished our task.]

Furthermore, we watch with great expectation as the DTI is finalising the codes of good practice. One is obviously compelled to comment on the centrality of the COTII group to champion and be amongst the best models of ensuring optimal utilisation of such good practices contained in the codes.

However, there are challenges ahead. Firstly, will the COTII agencies also champion a proper recognition of the centrality of workers in our economy? It is high time that we not only realise the vitality of workers when they bring the economy to a standstill, but also when they ensure the vibrancy of our economy and, obviously, of any economy in the world.

Secondly, there is the issue of inadequacy of requisite human resources. For example, the delay in the appointment of the CEO in the Competitions Commission is unjustifiable, and the 26% vacancies at the DTI, which situation I assume also affects the COTII group, is also cause for concern.

Thirdly, there is the issue of the extent of penetrating and advancing the second economy to such an extent that as a nation we can move faster to address underdevelopment and marginalisation.

Fourthly, there is the challenge of the Ministry’s resolve to address the crisis in the SA Estate Agents Affairs Board, which has been in the spotlight in the print media. Let me sensitise the Minister to the fact that this board has a responsibility to regulate an industry that is worth billions of rands.

Ndiyathemba, Bhuti waseMthatha, ukuba noko uyayiqaphela loo nto. [I hope that the hon member from Mthatha notices that.]

Fifthly, there is the challenge of strengthening focus on vulnerable people, especially those living with physical challenges and with the stigma associated with living with Aids and other dreaded diseases, rural communities, victims of abuse, especially domestic and cultural abuse.

Sixthly, there is the challenge of the extent to which COTII agencies will contribute to compliance with broad-based black economic empowerment, especially the good codes of practice, given the current and expected continued inertia and even resistance to this.

Masivumeni, mawethu,… [Let us accept, fellow countrymen, that …]

… there will always be resistance to all these noble endeavours. Let us remember that black economic empowerment is a moral, political, social and economic requirement of this country’s collective future, not just the government’s.

Seventhly, there is the issue of the capacity and the propensity of COTII agencies to enhance the sharing aspect of Asgisa. The National Empowerment Fund has already charted the way forward in this regard, but, unfortunately, this is not enough.

Eighthly, there is also the question of enhancement of the development programme for co-operatives, particularly the adequacy of the budget thereof. I maintain that there has been a good start, but there is a lot of room for improvement.

Ninthly, there is the challenge regarding the budget oversight drive, especially on co-operative government practices. Let us make sure that there is improved interaction and co-operation with key components of civil society, particularly organised business and local development groups. I think that the COTII group must also be part of that.

Tenthly, there is the challenge of co-ordination among COTII agencies and the dismantling of the “silo syndrome”.

Eleventhly, there is the challenge of intensification of beneficiation as a significant value-add strategy. These are some of the challenges that I feel we should look seriously into.

Our President has thrown down the gaununtlet by saying that government has a critical role to play in development agencies.

Xa ndivala intetho yam, ndicela umngeni kule Palamente iphelele, wokuba ilungu ngalinye liqinisekise ukuba iiarhente ezaziwa njengee-COTII agencies zisebenza zigobe umqolo, zifukuza, ukuze uqoqosho lweli lizwe luhlume. Iyabulel’ ilali. [Kwaqhwatywa.] (Translation of isiXhosa paragraph follows.)

[In conclusion, I would like to challenge members of Parliament to ensure that the COTII agencies work tirelessly in order to help the economy of the country grow. Thank you. [Applause.]]

Dr R RABINOWITZ: Hon Speaker and members of the House, I am honoured to present this speech on behalf of my colleague Prof E S Chang, who is unable to be here today. Most of this contribution is hers, with a few additions from me.

The IFP acknowledges and accepts that the Department of Trade and Industry has contributed to broadening participation in the economy. We welcome the new Minister, we support his budget and we applaud the hard work of the department. But we are also concerned about the pace of the department to catalyse economic transformation and development. Despite its successes, some serious challenges remain. Last year we passed a number of laws, yet alignment of these Acts is very slow. The only way to strengthen consumers, for example, is to align Acts such as the National Credit Act and the National Consumer Act.

In my available time I will focus on the Competition Commission, the need for the rural poor to be drawn into the larger economy, the need for more education on the Patents Amendment Act, while we still have laxity with regard to genetically modified organisms, and the apparent danger of missing out on an opportunity of a free-trade agreement with the United States of America.

Last year we saw the Competition Commission investigate a number of companies that colluded on price fixing, market allocation and the abuse of dominance. We feel that punitive measures need to be tougher. These cases incur huge legal costs, while the guilty party simply gets away with a slap on the wrist. Mittal Steel is one such example.

The second area is the rural poor. The Department of Trade and Industry has a website and a call centre, but these are useless if people in Mahlabatini and Nongoma can’t access them. A few weeks ago we celebrated Consumer Rights Day, but this is meaningless if citizens don’t know what their rights and responsibilities are as consumers. We need to be able to support the historically disadvantaged, for example by using mobile units as one- stop shops even if this requires public-private partnerships to make such initiatives effective.

Talking about the developmental state and Asgisa is cheap, but stimulating small business and providing more incentives for skills development are ways to use the budget to encourage meaningful economic participation.

Laws in respect of patents were intended to encourage indigenous people to unlock their own traditional indigenous knowledge, but this has not happened. It is still unclear what is happening with attempts to develop the hoodia plant, a dietary plant used by the San people.

We still do not have a successful test case or model that can be used for traditional people to confidently unlock their traditional knowledge and take out patents. Ironically, though, we are streaking ahead with the development of genetically modified seeds, which enrich international companies, where most of the patents are based in the United States of America. Why are we not reversing the focus?

The issue of America and Southern Africa trade brings me to the issue of the Southern African Customs Union’s free-trade agreement with the United States of America, or the potential for such an agreement.

Given our President’s commitment to such an agreement and the broad support for it within the ANC and other political parties, we are surprised by a series of exchanges between the US, the SA Business Council and representatives of the Department of Trade and Industry that have come to our attention.

They indicate that since October 2005 the United States has been waiting for free trade negotiations with the Southern African Customs Union to continue and has been utterly puzzled as to the reason why the government has not sought to proceed with negotiations and appears happy to let the opportunity of a free-trade agreement slip away. If the agreement is not signed by 19 April, the opportunity will only arise again in 2009. Apparently, its advantages are mainly for South Africa and other members of the Southern African Customs Union.

Since South Africa is not classified as a so-called least developed country under the African Growth and Opportunity Act, Agoa, the latter agreement provides little relief to the South African textile industry. A free-trade agreement could potentially extend benefits to all categories of products, including woven and nonwoven textiles, yarns, fabrics and made-ups including third-country fabric make-ups.

Not only would an FTA include textiles as part of Agoa, it would also expand the scope of product coverage to items currently excluded from Agoa, including many agricultural commodities such as canned fruit. It would increase the region’s export of fruits, flowers, meat products and perhaps even sugar.

An FTA would strengthen co-operation with the Southern African Customs Union in removing sanitary and phytosanitary barriers to agricultural trade, especially delays in food inspection procedures for meat and poultry. This agreement would help Sacu develop and diversify its agricultural sector and improve access to global markets.

Finally, a free-trade agreement would give South Africa access to US government procurement, it would open the South African service industry to the US market, it would provide real protection for South African intellectual property in the US, and, in general, it would assure the Southern African Customs Union region of permanent, enhanced access to the world’s largest market.

This is particularly important in the light of the diminished prospects for the Doha Round and the fact that even Agoa, as it stands, expires in 2015. This would not change the status of US trade with South Africa, except in strengthening certain areas underlining the members of the Southern African Customs Union.

What does South Africa stand to lose with the implementation of this agreement from which it clearly has a lot to gain? Is our government possibly averse to real meaningful co-operation with the USA? Since we find this hard to believe, we would appreciate it if the Minister, in his response, gave us some understanding of the process.

The IFP supports the budget. I thank you.

Dr M SEFULARO: Ke a go dumedisa Motlatsa Mmusa kgotla, Matona a a leng kwano, Matlatsa Matona, Motlatsa Poresitente le maloko a a tlotlegang – ke tla bua ka sekgowa. [Greetings to the Deputy Speaker, Ministers present, Deputy Ministers, Deputy President and hon members - I will speak English.]

Madam Deputy Speaker, we are satisfied that by and large the strategic priorities, plans and programmes adopted by the department are compliant with the key tenets of our policy and priorities as the ANC.

In addition to that, the annual report of the department and our own verification confirm that the department has achieved the majority of their strategic objectives for the financial year 2005-06. They also delivered on the tasks they were given as part of government’s work programme that arose from the President’s state of the nation address in February 2005. From the outset, therefore, I would like to confirm that we in the ANC support the budget, as proposed by the department.

My colleagues have already pointed out some areas of specific programme challenges that are confronted by our people and Parliament in realising the objectives that have been set out by the department. Over and over, there is the realisation of uneven success in the implementation of our policy priorities and programmes. The Minister has admitted as much.

But I would like to put it to the House that in the area of shared economic growth, many of the policy initiatives of the government and the department, in many instances, have been forced to respond to shortcomings, if not some obstructions, to the good policies, strategies and programmes. There is perhaps a need to reflect on the key aspects of the factors that are probably contributing to the uneven outcomes. First, let’s look at the legislative process. From the outset, when we promulgated the Broad-Based Black Economic Empowerment Act, we were pursuing the opening up and transformation of the South African economy. What forced the change in emphasis from BEE to broad-based black economic empowerment for which we produced an Act in 2003 was the realisation that there were factors distorting the original aims and values of the related policies and programmes.

Even the related regulations and instruments, like sectoral charters, proved to be inadequate in their own right. That is why we have had to develop the more elaborate, specific and compelling regime of the codes of good practice. Our view is that factors internal to government have contributed to the forced evolution and redefinition of black economic empowerment.

Internally we have seen inadequate policy and technical competence on the part of some officials charged with the responsibility for implementation. We have also seen how those in government wittingly or unwittingly work with external elites to harness the opportunities and benefits of black economic empowerment.

Externally some of our people have made themselves available for antitransformation and anti-black economic empowerment programmes such as fronting. This is explained by the appearance over the years of a repeat allocation of BEE deals to increasingly familiar companies and individuals – the so-called usual suspects. One of the primary reasons why the ANC-led government had to elaborate the Accelerated and Shared Growth Initiative for South Africa, Asgisa, is precisely because some of the central programmatic objectives of economic transformation and, more specifically, black economic empowerment had not been achieved.

We are now familiar with the recurrent complaint by our economic citizens that the beneficiaries of the good policies of our government are, in many instances, some political leaders, public servants and a relatively limited number of well-known individuals and business units. There is the suggestion here that there is a new elite that is emerging, which readily falls into the trap of self-seeking behaviour and mutual support.

Through this phenomenon, the old elite has easily managed to capture the new systems, leaders and opportunities, appropriating for themselves the opportunities and resources that are made possible by our democratic government. That is why we have had to say that indeed democracy has been very good to business, especially white-controlled and owned business. That is exactly the warning given by our movement, the ANC, in the document Preface to Strategy and Tactics in which the movement states that:

The occupation of positions of power by individuals from the black majority, and the material possibilities this offers, does create some social distance between these individuals and the constituencies they represent … Examples abound in many former colonies of massive disparities in the distribution of income between the new elite and the mass of the people.

These warnings of our movement do not seem to have been heeded very well in the past 12 years. Issues like conflicts of interest, preference for internal accountability and an inappropriate emphasis on quantitative over qualitative measurement will have to be monitored and combated with the necessary vigour and vigilance.

There is a tendency to emphasise the numbers without emphasising the process of transformation and democratisation of the economy, which is the qualitative side of life. Perhaps we need to raise the question of how well the department and its subsidiary institutions are positioned to take us closer to the realisation of the developmental state.

We declared at our 51st national conference: “We seek to build a developmental state with the capacity to effect fundamental transformation; a state that approaches the means of production on the basis of the balance of evidence, informed by the needs of the people, particularly the poor.”

What will it take for the Department of Trade and Industry to increase and adapt its role so that it accelerates the use of its capacity and resources to achieve the goal of a developmental state? I want to suggest to the hon Minister that we may need to think very hard about how the department can work with other departments in the cluster to look at dedicated training programmes for the development of capacity for entrepreneurship and development funding support.

This aspect raises the question of whether we should not be looking at an institution or national institute for training and capacity-building for entrepreneurship and development financing. Alternatively, shouldn’t we partner in the same way that we talk about Jipsa – the Joint Initiative for Priority Skills Acquisition - with private partners to create such an institute? We must also be looking at the challenges of democratising economic participation.

There is the problem, as we have already warned, that an elite can capture the opportunities that come with government, an elite of those that manage the policies and the programmes plus those who are outside. As we strengthen local government, we will have to look at ways of increasing participatory democracy even in economic spheres of life, so that participatory democracy is not limited to the political and the social spheres of life.

We may, indeed, even have to review the constitutional and legislative arrangements so that things like concurrency, that sometimes render the Minister helpless in the face of resistance or incompetence at other levels of government, can be dealt with. We must also look at whether centrally situated offices that are implementing all the things should be there at all. Shouldn’t we be looking at a central office and regional offices that are more co-ordinative and supportive, while we locate some of the implementation functions within municipalities?

We, ourselves, have said that every district and municipality must contribute to the transformation of our economy and put in place economic infrastructure. If an office in the national capital, or the regional head office, is implementing next to a municipality and far from the small town in the rural area, is there no possibility that you can get a bias in which those that are closest to the national head office or to the regional office are the ones that access these opportunities?

There is perhaps a need to rethink very carefully the arrangements that we have in place so that we can unblock those elements that retard our progress towards the implementation of the very good policies of the ANC- led government that, I believe, are in themselves correct and that should lead us to a developmental state that deals with poverty and unemployment.

Thank you very much, Madam Deputy Speaker. [Applause.]

The DEPUTY MINISTER OF TRADE AND INDUSTRY (DR R H Davies): Madam Deputy Speaker, hon members, it is pretty much common cause in the serious economic policy debate in this country that we need a more effective and robust industrial policy. Economic history teaches us that those very few developing countries that have succeeded in breaking out of their historical places in the global division of labour as mere producers of raw materials have all had active industrial policies.

In the case of the prominent examples of successful industrial policy, governments of various East Asian countries were in the 1960s and 1970s all prepared to assert leadership to the extent of getting prices wrong and directing investment into the development of lines of industrial activity not then recognised by markets, but which through active industrial policies subsequently emerged as major competitive advantages. Behind the more recent rise of China as a major economic power have also been active industrial policies.

Asgisa adds its voice to calls for a more robust and active industrial policy in South Africa, seeing this as a necessity both to accelerate the growth rate and to ensure that the benefits of growth are shared.

Our department, as the Minister indicated, is in the final stages of preparation of a broad strategic framework document, which we hope will pass through the governmental process within the next few months.

In addition to the overall framework document, we anticipate that there will be a need for the development of new strategies on important key related matters, like industrial finance and capacity building for industrial policy. We also need to push forward to refine and improve sectoral work, which has been under way for some time. I have had the privilege to chair a review team, which has engaged in a self-critical reflection of some of the challenges that face us in making our industrial policy more effective.

Industrial policy is, of course, not new in South Africa. In the period since 1994 we have produced several industrial policy strategic documents and for some time have engaged in sector processes, some of which, for example, in the case of the motor industry, have scored important successes.

However, our reflection has led us to conclude that some of our efforts in the past were too dispersed and too unfocused. As a result we have often failed to deploy sufficient resources to actually make a real difference to the performance of, and activities within industrial sectors. Among the themes, we will be emphasising in our new approach will be the need for government to facilitate and encourage all stakeholders to engage in processes of self-discovery. Self-discovery needs to take place both at macro level and at sector specific level. At macro level, it needs to lead to the identification of sectors, which will be targeted in our industrial strategy. Considerable work has, of course, already been done in this regard and our reflections on self-discovery at this level have led us to recognise that in South Africa we have a fairly diversified industrial sector with strengths in a variety of areas. There is also a need to break down artificial divisions between industrial and service sectors on the one hand and between industrial and or manufacturing sectors and primary sectors on the other.

This exercise has led us to recognise different categories of industrial sectors that need to be targeted for more focused attention. Unfortunately, I don’t have time right now to discuss the details of this any further.

At sector specific level the process of self-discovery needs to lead to the identification of key action plans, needed to take sectors from where they are to where they need to be. Here again we need to build on, accelerate and improve on customised sector processes that are already under way in a number of areas. Through the CSPs we need to identify the kinds of contribution, which will be necessary from government, business, labour and other social partners to advance action plans.

A further conclusion from our self-assessment is that as government we must be willing to employ our resources in a more concentrated way that can actually make a difference. Greater customisation of industrial financing and incentive programmes and alignment with action plans identified in sectoral processes will be absolutely necessary if we are to make the impact which we need. This will require greater coherence between the processes at sectoral level, and those in which industrial incentives and financing measures are actually designed.

We will also need to look more closely at the issue of conditionality and reciprocity in the deployment of incentives and offerings. We need to be offering sectors and firms significant resources for programmes and projects that will make a difference. But we must insist on reciprocal action by recipients of this support and be willing to withhold or withdraw support if appropriate agreed restructuring does not take place.

Pursuing a more effective and robust industrial policy of this kind will require us addressing some very important challenges of capacity-building. We will have to significantly enhance our own capacity within the dti and make sure that this capacity is optimally located in the various divisions of the department.

We will also need to find better mechanisms to bring in and co-ordinate industrial policy capacity that exists outside of the immediate framework of the dti in COTII institutions, like the Industrial Development Capacity, and in other government departments. Beyond this, we need to create mechanisms to draw in and build on expertise which exists outside the governmental framework, in universities, research institutions and the like.

This all has to relate to our institutions of social dialogue and must be reflected in sector processes that are, in fact, exercises of self- discovery by key stakeholders involved in industries and sectors themselves. These will be major challenges that we in the Ministry and the department will have to confront as we go ahead.

We are looking forward to, and welcome an active engagement with the portfolio committee and with this Parliament in a process, which will not lead to the production of an industrial policy that is going to be written in stone, but an industrial policy which we all need to see as constant work in progress, which needs to be reviewed periodically, perhaps at three- year intervals.

Let me now make few remarks about some of the key issues in international trade negotiations.

We meet at a very critical moment in the ongoing WTO Doha negotiations. At the end of last year, South Africa, along with all the other members of the WTO, participated in the 6th Ministerial Conference held in Hong Kong, China. According to the original milestones for the Doha negotiations, Hong Kong was supposed to have agreed on full modalities to give effect to the principles agreed to at Doha in 2001 for agricultural, non-agricultural and service negotiations.

It was recognised even before the Hong Kong Ministerial Conference, however, that there was not sufficient agreement among the membership to achieve this goal, and Hong Kong tried to reach a halfway house short of full modalities. It did however set a target of reaching full modalities on these subjects by 30 April this year. Intensive behind the scenes activities are taking place in Geneva and elsewhere in an attempt to explore the possibilities of reaching this target.

It is a matter of great regret that we need to report to this house that the chances of achieving a developmental outcome by the new target date for modalities look as remote as ever. In Doha in 2001, developing countries, ours amongst them, put forward a powerful and convincing case that the fundamental requirement for an equitable and effective world trading system was to address a number of imbalances and inequities that negatively affected developing countries. These included prominently the issue of agricultural trade and the thorny question of subsidies.

Previous rounds of multilateral trade agreements, up to and including the Marrakesh agreement of 1994, had largely left intact the system of agricultural trade in which developed countries were able to maintain substantial protectionism against competitive products from developing countries, through high tariffs and subsidies paid to small numbers of farmers in the developed world.

Average tariff cuts in non-agricultural products allowed the continuation of tariff peaks and tariff escalations on industrial products where developing countries had an export interest. Developing countries argued that the focus of a new round, and indeed the basis on which they would agree to a new round, was that distortions in agricultural trade as well as tariff peaks in escalations and non-tariff barriers on industrial products where developing counties have potential, should be the focus of the work programme.

Of course, the Doha mandate also included a number of demands of rich countries, but we should not forget that ministers at Doha agreed to place the needs and interests of developing countries at the heart of the work programme of the Doha round.

Unfortunately, the period since Doha has seen an attempt both to water down the adjustments required by developed countries to give effect to the Doha mandate, and an attempt to combine this with highly ambitious demands directed at what are called advanced developing countries.

We have seen extremely modest proposals from both the EU and the US for cuts in the agricultural domestic support that would still leave in place the possibility for these countries to deploy large resources to subsidise the activities of a small number of farmers in those countries.

At the same time we have seen a wholly inadequate offer from the EU on the question of agricultural market access. The G20, the Cairns Group and the US, have all concluded that this proposal from the EU could effectively block any real additional market access for current product of export interest to developing countries.

This has been coupled with demands in the non-agricultural market access area that would see countries like South Africa being obliged to make very significant cuts not just in bound, but also in applied tariff rates.

In the run up to Hong Kong, South Africa along with a number of other developing countries tabled a document in the WTO which we entitled “Reclaiming Development”. We argued that we needed to re-assert proportionality in the negotiations; that the biggest adjustments needed to take place in the sector that was most distorted – that is agriculture; that the biggest adjusters needed to be the big developed country blocs that were involved in these adjustments, and that the obligations of developing countries according to principle of special and differential treatment needed to be smaller.

During the Hong Kong conference, our delegation under the able leadership of our Minister, managed to play an active role in these and other issues. We consolidated the group of developing countries that had signed on to the Reclaiming Development paper, and constituted it into the grouping that we called the Nama 11. This existed alongside the G20 alliance of developing countries on the issue of agricultural trade.

Nama 11 resisted an attempt to try to force a premature agreement on modalities in non-agricultural market access ahead of any significant agreement on the main issues in agriculture. We also managed to have included in the Hong Kong declaration a paragraph on the balance of the outcome of the round as a whole. Paragraph 24 speaks of the need for a comparable level of ambition in market access in agriculture and in Nama. And it goes on to say that this must be achieved in a balanced and proportionate manner consistent with special and differential treatment.

Recent technical work undertaken by a group of 10 countries, six developed and four developing, has established that even within Nama itself, developed countries would have to accept a very low coefficient in the application of Swiss formula, a coefficient of around 2, to ensure that they take a bigger proportion of reduction in applied industrial tariffs than developing countries applying a coefficient higher than in many proposals of around 35.

I am happy to report that Nama 11 continues to be an active and significant force in these negotiations. We, as South Africa, will do all we can to ensure that we do not find ourselves in a situation where we are obliged to make large adjustments in our industrial sectors to achieve little or nothing in the area of agriculture. That could not be a developmental outcome.

Where the WTO process goes from here will not be easy to predict. What we need is a high-level political decision in the developed world in favour of the developed world taking the lead and making the adjustments that are necessary, not just in the interests of developing countries, but in the interests of the global trading system as a whole. Failing this, there are real prospects that we may end up coming out of the Doha process with little that can be recognisable as a developmental round.

The danger in the latter scenario is that we will be faced with the alternative of aggressive bilaterals, in which partisan ambitions that the major economic powers have not managed to realise in the multilateral process are recycled and placed on agendas of bilateral negotiations. We can see signs of this in some of the bilateral processes we are engaged in.

Let me at this point clarify some of the concerns that were raised by Dr Rabinowitz on behalf of Prof Chang. The Sacu-US negotiations have failed to make sufficient progress, not because we do not recognise the importance of access to the US market. Of course we recognise that. They have failed to make significant progress because we have faced what we believe are inflexible proposals on tariff reductions that do not take sufficient account of our different levels of development and the principles of asymmetry.

These proposals in tariff reductions have been combined with demands that would effectively require us to accede to the US systems and positions on a host of so-called “new generation issues”, including competition policy, state procurement, intellectual property, and so on.

One of the difficulties we face in this regard is that we now negotiate not as South Africa, but as the Southern African Customs Union. As a customs union of five countries including, at least, one least-developed country, we do not have common positions on these kinds of issues. The actual regimes of the five members of the customs union on intellectual property and on competition are fairly divergent. A meeting at the level of deputies, which in our case means the Director-General, is scheduled for next month. If we are to make progress, as we would like to do, it is essential that our partners show greater flexibility than they have up to now.

I was going to speak about some other trade issues, but I am afraid I don’t have time. Therefore I would like to thank the House for its attention and its support for this Budget Vote in anticipation. Thank you very much. [Applause.]

Mr A HARDING: Madam Deputy Speaker, the Department of Trade and Industry has set itself the goals of raising investment levels, broadening economic participation and increasing competitiveness. These are very important goals to make the implementation of Asgisa as effective as envisioned.

Economic growth coincides with appropriate infrastructure. The past few months have proven that our current infrastructure is indeed not adequate to support the growth we have been experiencing and what we anticipate for the future. For example, our rail commuter service is substandard and trains are so overcrowded during peak hours that people literally have to hang out of the doors.

Our SMME sector has suffered great financial losses due to the electricity failures throughout the Western Cape. We think that it is time that the department seriously considers its “nuclear energy only” approach to this problem. These two areas have serious repercussions for both current and future investment in our country - not only foreign, but also domestic investment.

This is the kind of stuff that we feel investor scares are made of. Services account for 74% of output and 72% of formal employment in South Africa. The expansion of this sector must clearly be considered central to government’s endeavours to promote growth and employment. Equally important is the need to enhance the competitiveness of services sectors that comprise intermediate inputs into agriculture, mining and manufacturing.

The ID wants to stress the importance of international trade and investment, particularly with China. Although such bilateral agreements are beneficial, the department must take precautions not to sacrifice the jobs of thousands of people in our textile industry. Last year, a report found that South Africa exports relatively low-value, capital-intensive products to China that face fairly low-tariff barriers, and that South Africa in its turn imports relatively highly protected higher-value labour-intensive products.

However, a trade analysis that identifies commodities with high export potential in China’s markets, found positive exporting prospects for South Africa. The challenge is to maximise the potential gains from, and reduce the costs of trade through, perhaps, a preferential trade agreement.

In conclusion, the ID supports this Budget Vote. Thank you.

Mrs C DUDLEY: Hon Deputy Speaker, hon Ministers, the ACDP notes the increase in the budget for programme two, which relates to international trade and economic development. We would like to assume that in providing additional funds for the negotiation of preferential trade agreements, South Africa will actually benefit.

We are concerned, for instance, that the dialogue established between India, Brazil and South Africa has not translated into tangible gains for South Africa. Brazil currently imposes a 60% tax on all manufactured imports and South Africa is not exempt from this, despite the India-Brazil- South Africa forum being hailed as the new Southern trade powerhouse.

In addition, the increasingly tight relationship between China and South Africa appears to be creating more problems than solutions. A major criticism has been that imports from China are threatening the growth of South African manufacturers. The clothing and textile industry has been particularly negatively impacted, and this underscores the need to ensure that domestic interests are guaranteed a measure of protection in any trade agreement instituted.

The African Christian Democratic Party welcomes the increase in the budget for enterprise development, with particular appreciation for the concerted effort by the department to take the lead in providing much needed support to South Africa’s small, medium and micro enterprises.

The SMME sector is particularly significant for empowerment and development of communities. Measures to prevent and expose corruption and mismanagement are very important if this sector is to reach its full potential as a key driver of job creation.

The ACDP will support the Trade and Industry Budget Vote. Thank you.

Ms D M RAMODIBE: Hon Deputy Speaker, hon Deputy President, hon Ministers and Deputy Ministers, hon members, ladies and gentlemen, one of the core functions of Parliament is the facilitation of public participation. When the Freedom Charter said: “The people shall share in the country’s wealth,” it did not only mean acquiring wealth, but participating in how to acquire it.

It went on to say: “All restrictions on the right of people to trade, to manufacture and to enter all trades, crafts and professions shall be ended.”

The ANC will continue to put the people at the centre of development, and not merely as beneficiaries, but as drivers of transformation. That was the message from the President when he launched the local government manifesto.

A consumer is a very important component in the production cycle. For many years the majority of the people of this country were forced by apartheid laws and subjected to living in poverty by being denied the right to participate in the economy of their country.

The ANC-led government has come up with the piece of legislation and policies to redress an efficient regulatory service for economic citizens. The Consumer Protection Bill responds to the President’s state of the nation address, in which he called on government and society to speed up in addressing challenges, underdevelopment and marginalisation of those who are in the second economy.

The Bill provides the consumer the right to choose, and the responsibility by the supplier to deliver goods and services at a place and time agreed on by the consumer. Consumer protection must also go hand in hand with the responsibility of the consumer behaviour. The right to disclosure and information is very important for the name of the business to be disclosed, even by those who represent the business. This applies to the price as well.

This is very important, as businesses always get away with murder when they have two prices displayed. It is the lower price that has to be charged.

According to the national consumer survey, out of 70 people, 8% are said to have been misled by advertising. The white community group goes up to 18%. The number might be higher in urban areas like in white communities, but lower in rural areas. This simply means that people in the rural areas are not yet aware of their rights.

Concerning the right to honest dealing and fair agreements, the national consumer survey has found that out of 40 people, only 4% mentioned experience of unfair contract terms, rural areas being low. Unfair tactics or conduct is prohibited in connection with marketing.

The survey also reveals that 10% did not receive the product they signed for as per contract, and 10% had problems with insurance on hire purchases, whereas 8% raised concerns about interests charged. In most cases suppliers never inform the buyer about the insurance, they simply include it in the price.

Another issue is about the right to fair value, good quality and safety. Often consumers are not given information on the safety of goods they purchase. It is an obligation of the supplier to alert consumers of any activity that is of any hazard that may result to injury or death. A warranty of maintenance must be made available.

This reminds me of the mine dumps where someone has consumed and benefited from the gold and someone else is now suffering due to the dust that they consume from the mine dumps. Notice of ingredients that pose a chemical or biological hazard not only to humans, but also to the environment, and of how to inhibit the risk, must be issued.

The Freedom Charter, which was adopted in 1955, was adopted for a purpose, and it is for this purpose that it is crucial that we ensure implementation of the policies developed, because they emanate from a document that is based on the will of the people.

The Patents Amendment Bill, for instance, and the regulations thereof, is one area that was dominated by few in the country, and others in foreign countries. The white minority as a group have, over the years, enjoyed a monopoly on this aspect. The indigenous people who are meant to benefit from this are the ones found in the second economy.

It is only by implementing the Act that we can make a difference to the lives of our people. The National Credit Bill seeks to entrench the rights of the South African consumers, establishing new institutions to enforce their rights and providing them with access to redress. It provides the consumer with protection, as it prescribes procedures to be followed when the credit provider and the credit receiver enter into an agreement.

The Bill is one of the tools that will contribute to the wellbeing of our people as it unlocks the doors for those who have been denied credit unlawfully. Hence the people who are mostly affected must be afforded enough opportunity to participate in shaping the programmes. However, there is a need to examine the charges or service fees with regards to the mortgage, in particular the initiation fee, whereby you may find hidden costs in an article that you are buying.

We are still living in the world whereby the rich continue to steal from the poor. It is not enough to give the number of enquiries and complaints when you are not given where those enquiries and complaints come from.

The majority of the people of this country are black, in particular, black women. Therefore, if we are to make a meaningful impact on the economy, it is vital that we empower women. It is not theory, but a reality, that if we exclude the majority of our people from participating in the economy, we will not be able to achieve the 6% GDP we seek to achieve between 2010 and 2014.

Broad-based black economic empowerment cuts across all departments, and if we are to halve unemployed and poverty by the year 2014, integrated development must be improved. We welcome the broad-based black economic empowerment scorecard that will be used to measure the core elements, which are ownership, management, employment equity, skills development, affirmative procurement and enterprise development.

Following are some challenges that we are faced with. There is a need for government to increase its capacity in ensuring that people do not consume what they are not supposed to consume. Government also needs to look at the extent to which work has been done on sustainable consumption.

There is a need to increase investment that leads to job creation. To what extent do we facilitate consumer movements to enhance the utilisation of news? Recently the consumer has been taken seriously globally in terms of protection, but this can also have a negative impact on the environment.

Consumer education driven by the DTI, through its website, is very welcome. However, the survey has shown that much more effort is needed in rural areas. We also need to examine amnesty with regard to blacklisting by the credit bureaux.

One other area that needs to be commended is tax relief on individual income. This is the hope that the President alluded to in his state of the nation address when he reminded us of our commitment to the poor, and our responsibility to hold the flame of hope and delivery.

The ANC supports the Budget Vote No 32. [Applause.]

The DEPUTY MINISTER OF TRADE AND INDUSTRY (Ms E Thabethe): Madam Deputy Speaker, hon Deputy President, hon Ministers, hon Deputy Ministers, hon Members of Parliament, distinguished guests, ladies and gentlemen, the attainment of human rights, at its essence, is related to what happen in the economy. As much as anything else, it is about how people are related to the process of production and distribution of the wealth in their country.

Madam Deputy Speaker, March is Human Rights month, and this gives us an occasion to reflect on what it is we have done and what it is we still need to do to advance human rights in South Africa.

I am sure that all present here today largely enjoy the comfort and protection of a first economy existence. Yet we know that there are many millions of our people who live on the margins of the first economy. They are the inhabitants of what we refer to as the second economy. They are the entrepreneurs of necessity and they are the marginally self-employed. They are the working poor. Women and those living in rural areas are likely to be over-represented in their ranks.

The foundation of human rights is that they are universal. We are therefore duty-bound to extend the attainment of these rights to those in our midst who are too disempowered to attain them on their own. Women, the rural and urban poor and the working poor, are among the vulnerable constituencies that, if afforded the protection and support to which they are entitled, can contribute significantly to the country’s economy.

To facilitate meaningful participation in the economy, the Department of Trade and Industry is determined to leverage the first economy in order to integrate and support sustainable livelihood in the second economy. One obvious way is through the continued support of small businesses via the Small Enterprise Development Agency, as articulated by the Minister. Also, to state that the role of Seda is indicated as a tool that we have to use when we facilitate dedicated support to small businesses in Asgisa and priority sectors and provide crucial business development information to small businesses in general.

Seda is in the process of being rolled out, but I must report to this House that we managed to have launched Seda in five provinces, and the other four provinces are ready. But we hope that it is through the commitment our Minister made last year during the budget vote. And yes, we will be able then to conclude that process. The role of Seda, as it relates to the second economy, is one of supporting and growing entrepreneurship, particularly in historically disadvantaged and poor communities.

As a first step, Seda must raise public awareness as to the viability of entrepreneurship as a strategy for a sustainable livelihood. To that end, the agency has been quite busy over the past year. Over and above all other promotional activity, Seda has been involved in regular time-slots on nine community radio stations to promote entrepreneurship and to address both specific and generic sectoral issues. They are also moving on to other programmes on the TV like SHIFT, which was shown yesterday. Many people were phoning in and getting the responses directly from the Seda management.

Seda has been also involved in many aspects in terms of assisting people with their products and what it is what we need to do in this development sector. But we think that issues that were raised in the North West province when they were having the Seda Summit were everyday bread-and- butter issues, but also talking to the question of best practice for public- private partnership in small enterprise development. The delegates who attended that summit were offered insights into building partnerships that empower entrepreneurship, as well as ensuring that capacity building was dealt with.

The top priority for Seda in the coming year is to roll out physical infrastructure and establish a national network in order to deliver its various programmes to the people wherever they may be.

Seda is working hard with the economic cluster to ensure that its roll-out gains as much leverage and coherence as possible from the work of economic clusters of departments and the rest of government. This will be a tough challenge for the young Seda, but I think, with the committed staff and the CEO, they are able then to pursue this particular goal.

It is widely accepted that co-operatives are an important enterprise vehicle in finance-constrained communities and indeed provide an important avenue to the collective advancement of sustainable livelihood at the community level. In this regard, the co-operative strategy has been presented to Nedlac and it will undergo parliamentary processes soon. You are all witnesses that last year we passed a Co-operative Bill, but also we need to talk to the greater strategy. Working together with the Department of Agriculture, we hope that we will be able to make a difference, making sure that co-operatives can work and assist a lot of women in small businesses.

A special project in the textile sector has been approached to train women across the nine provinces in the Asgisa targeted crafts industry. The project focused on craft design serves the ends of job creation, poverty alleviation and skills transfer. While the R500 000 project is of a relatively small scale, it could well serve as a model for future projects of this sort.

Alignment of COTII support programmes is crucial to the success of the co- operatives strategy. In this regard, Seda and Khula are also working closely with the Department of Trade and Industry on financial and non- financial support referrals. In addition, the NEF has developed three instruments for co-operatives.

A co-operative advisory board will be established to advise the Minister on the implementation of this policy. This will support the department in seeking out innovative ways of empowering co-operatives as an engine for development.

With regard to the SA Micro-Finance Apex Fund, the past year has seen a lot of roll-out in the different provinces. And as much as this is going to be operational as a business entity from 1 April, the Apex Fund has been working in many provinces and many developments have partnered with SAMAF, and they are really making a difference, because those people from rural areas and from the poor areas are now able to be bankable and they are able to get these loans and start their own businesses. [Applause.]

At the heart of growing the South African economy, reducing unemployment and eradicating absolute poverty, lies the economic empowerment of women who continue to be overrepresented amongst the poor, as the last speaker indicated. Supporting women entrepreneurship is therefore an indispensable part of any serious programme aimed at the second economy.

The department is planning to make 2006-07 the year of bold steps forward for the participation of women in the South African economy. To that end, this year will see the finalisation of the Strategy on Gender and Women Economic Empowerment which we believe will be able to assist in terms of ensuring that we have better products that can talk to the women’s programmes because you are all aware that when you empower a woman, you empower a nation. [Applause.] Not that our menfolk are useless; even children when they are hungry go to mother and ask for bread or food. So, that is along those lines that we think that we should empower more women. Yes, there will be a difference and through the Asgisa programmes we hope to strengthen this particular process. We shall also be rolling out a Women in Entrepreneurship Programme and pilot implementation of the Young Women in Entrepreneurship Programme because we believe they need to be trained, as young as they are, so that when they grow old they are already entrepreneurs who do not suffer need because of unemployment. They think of what it is that they can do, and they come up with these very good mechanisms that they have.

Also in the women empowerment strategy, the South African Women Entrepreneurs’ Network, SAWEN – which is some of those that were conceived by our Deputy President, but also by my predecessor who is the Minister of Mineral and Energy, has been an important vehicle for stimulating women entrepreneurship across the country. Through SAWEN women have engaged with the department positively and we are convinced that the emerging partnership between South African women and the Department of Trade and Industry will support women’s entrepreneurship. Through the support of SAWEN and the international linkages that we have been forging with the assistance of the Presidency, we are sure that the South African women’s products will access the formal market in increased numbers.

We also have high hopes for the Technology for Women in Business initiative, which is also part of the structures or strategies that were conceived by my predecessor, umam’ uLindiwe. Those are the tools we have as the Department of Trade and Industry and the initiatives that are assisting our women in business to make sure that they sharpen their business.

When considering protection for the marginalised and the extension of rights, consumer rights are critical. But the fact of the matter is that in all that we have done as the department, there is still a large percentage of people who don’t really know what their consumer rights are. And mostly people who suffered happened to be those that are underdeveloped or in rural areas or peri-urban areas. But also in some urban areas there are people who don’t really have a clue of what these consumer rights are all about. So, it is our task then, as the department, to make sure that we have this continuous programme of educating our people through legislation and other formations, but also to make sure that we come up with the strategies that will ensure that the exploitation of our people can come to a stop, because unscrupulous operators are out there making sure that they have a lot of profit that is not … [Time expired.] [Applause.] Dr G G WOODS: Madam Deputy Speaker, my time allocation here does allow me only to make a few general comments. I think is true to say that if poverty is the worst problem this country faces, and if it is true to say that the economy, a growing economy, is the best means to resolve poverty, that would make the Department of Trade and Industry amongst our most important government departments.

Madam Deputy Speaker, the National Democratic Convention has studied the strategic plan of the department and its objectives, and we have looked at how those objectives are incorporated in the Budget for the coming year, and we are very encouraged with the way the department has been taking shape. We do feel that the department in the recent time appeared to have changed up a gear. There is a great focus. It is more purposeful and this is very much reflected and its current programmes and the ways its managing the institutions that are agent to the department.

On the issue of growth, currently we have a fairly healthy growth rate in the country of just on 5%. We know this is largely consumer demand driven. The types of programme that we see in the department are going to make it a more comprehensive growth path, especially adding some very important stimulation provisions.

On the issue of Asgisa, which is a very important initiative by government, meant to unblock certain problems with the economy and to stimulate very key issues in the economy, I think it is important to note that no matter how important Asgisa is, Asgisa can only succeed if the programmes of the department succeed. And as inferred a moment ago, we have a lot of confidence that these programmes are going to succeed and as a result we have no hesitation in supporting the Budget.

Mr J J MAAKE: Madam Deputy Speaker, Madam Deputy President, Ministers and colleagues, I am today giving a speech in this House in the second decade of our liberation, the liberation that our people fought so hard for, the liberation which saw our people lose their loved ones, which saw people being jailed, maimed and even hanged by a system which was declared a curse against humanity.

We are now in a democracy that has restored the dignity of our people, which has improved the lives of the majority of our people. Apartheid was a horrible, inhuman system, best understood to the full by those of us who were on the receiving end of it.

The Department of Trade and Industry has as its aim the catalysation of economic transformation, and developing and providing a predictable competitive, equitable and socially responsible environment for investment, enterprise and trade for economic citizens.

In this way, we will be contributing to achieving our vision of an adaptive and restructured economy, characterised by accelerated economic growth, employment creation and greater equity by 2014.

Ten key objectives have been identified by the DTI, reflecting the primary economic outcomes necessary to generating higher levels of economic growth, employment and equity. Amongst others are to increase small enterprises’ contribution to the economy; increase market access opportunities for South African goods; contribute to building skills, technology and infrastructure; promote access to redress for economic citizens such as consumers; contribute to building a single equitable economy, and bridge the divide between the first and the second economy.

The department has to a great extent succeeded in advancing most of these objectives. It has promoted greater awareness of the department by effectively branding and packaging its products and services and ensuring access to the department through efficient distribution channels.

In his state of the nation address, the President highlighted the importance of a co-ordinated approach to delivery by the three spheres of government, the intergovernmental aspects which must address the rural/urban divide and the need to bridge this gap. Amongst the binding constraints to bridge this gap is the shortage of suitably skilled labour, amplified by the cost effects of labour of apartheid’s spatial patterns. If I was to give an example of the spatial outlay of apartheid, Polokwane, where I come from, might be such an example. Between the white suburbs and Indian suburbs is the N1, that divides them. Between the Indian and the Coloureds suburbs there is a railway that goes through, and between the Coloureds and the African township there is a graveyard. [Applause.]

Apartheid has created pockets of underdevelopment in the rural areas. The aim, deliberately so, was to create a pool of unskilled workers so that they can draw from this pool for their farmers and mining magnates.

To undo this evil which was deliberately done over a period of three and half centuries is a mammoth task. Everybody, except perhaps the DA, will commend this government for reversing most of these ills in just a decade. Those parts of the legacy of apartheid most difficult to unwind are the deliberate inferior system of education and the irrational patterns of population settlement.

In this period of growth, it is evident that we lack sufficient skilled professionals, managers, and artisans and that uneven quality of education remains a contributory factor. In addition, the price of labour of the poor is pushed up by the fact that many live a great distance from their places of work.

The land distribution, housing and eradication of settlements issues are heavily linked with co-operative integrated strategies of municipalities and provinces. A strong emphasis is therefore given to the alignment of programmes of the provincial, national and local spheres of government to speed up delivery of this and other services. Without interventions directly addressed at reducing South Africa’s historical inequalities, growth is unsustainable.

Interventions to address deep-seated inequalities and which target the marginalised poor are interventions to bridge the gap with the second economy, ultimately eliminating the second economy.

The three spheres of government have been working together and in consultation with partners to elaborate a specific intervention that will elaborate on the Shared and Accelerated Growth Initiative for South Africa. All spheres of government, state-owned entities and social partners are engaged in this. Asgisa consists of a limited set of interventions that are intended to serve as catalysts to accelerated and shared growth and development. As far as local government and service delivery are concerned, the government is focusing on addressing skills problems identified in Project Consolidate.

I sometimes think that there should be an economic truth and reconciliation commission directed specially at those who were making laws at the time when our people were poor and starving in a land of plenty. What immediately comes to mind is the Bantustans and how they operated. For example, instead of building the economy of the so-called Lebowa Bantustan in order for it to be sustainable and create jobs and thereby eradicate poverty, people who are today still in this Parliament allowed taxpayers’ money to buy a rainmaking machine, something that would never be sustainable in any economic sense to the lives of our people. [Interjections.] If that does not need an economic TRC, very few things will!

Hon Rabie said that not all small, medium and micro enterprises can create employment. You must agree with me that stupid laws were made in this country to the detriment of its people and our economy.

I will give an elaborate and illustrative example of this stupidity, of which some people in this House were part. In an ideal apartheid economy, a small entrepreneur would have had to have not less than eight toilets on his or her premises if he or she was to abide by the laws of that time - two toilets for male managers, that is black and white; two toilets for female managers, that is black and white; two toilets for male labourers, that is black and white, and two toilets for female labourers. That makes it eight. [Applause.] [Laughter.]

What type of economy can survive such economic idiocy? But as I said earlier in my speech, some of the people who made these laws should be charged with fraud as there is no Act of Parliament which caters for a charge of stupidity.

The DA should be the happiest of all parties that this is not the case anymore as they represent the capitalist class in this country. The ANC government has managed to dismantle and reconstruct this system, which was stupid in the extreme. Though the DA still lingers under a shifting sense of illusion that there might be a reversal of this process which means, when I analyse it, that they long for the previous stupidity … [Time expired.]

The ANC supports the Bill. [Applause.]

Mr S M RASMENI: Chairperson, Deputy President, Ministers, Deputy Ministers, members of Parliament, ladies and gentlemen, the central role played by the Department of Trade and Industry is to develop policies and implement strategies that promote and foster competitiveness, enterprise development, empowerment and equity.

This role enables our country to take forward the principles of the Freedom Charter adopted by the Congress of the People in 1955 that: The people shall share in the country’s wealth’’,The land shall be shared amongst those who work it’’ and that ``There shall be work and security’’.

This function of the department falls under programme 3, enterprise and industry development. We have noted with appreciation the increase in the budget from R1 205 359 to R1 234 917, which indeed will facilitate the driving of the subprogrammes such as industrial competitiveness and enterprise development, which will increase the number and sustainability of small, medium and micro enterprises, and the subprogramme on equity and empowerment, which deals with broad-based black economic empowerment.

We are confident that the implementation of these subprogrammes will contribute immensely to the further economic growth of our country, thus ensuring the successful implementation of the Accelerated and Shared Growth Initiative for South Africa, Asgisa. Today is better than yesterday, and tomorrow will be better than today.

The enterprise and industry development division, in further strengthening its work to co-ordinate small, medium and micro enterprise support and development, has presented to the committee the integrated small enterprise development strategy - the revised strategy - which aims at improving co- ordination of government initiatives supporting the small business sector; ensuring that blacks are more represented in small businesses; improving access to finance to create an enabling environment for SMMEs by providing mechanisms for graduation of black-owned enterprises to move from informal to formal businesses, and to move from micro to small and medium enterprises and allows for graduation to big business, thus aligning this programme to Asgisa priorities.

The challenge presented by the strategy is the implementation plan, and the vehicles and tools by which to put this strategy into action. Hence, the department is facing huge vacancy levels in terms of personnel.

Government has mandated the Department of Trade and Industry to provide leadership in facilitating promotion and support of co-operatives. This should be one of the key elements of SMME development, because co- operatives bring together fragmented small and micro businesses and turn them into strong and sustainable enterprises.

Parliament passed the Co-operatives Act in 2004, and we are told that there is a co-operatives unit in the department, but it seems as if it has been given a back seat in both the department’s strategies and in terms of prominence in departmental programmes.

Allow me to deal with another critical aspect regarding the transformation of our economy, which is black economic empowerment. During the course of the first decade of our democracy, the ANC and government observed that despite the economic success and the broad range of state policy and programme interventions aimed at overcoming the legacy of apartheid, the country was still faced with massive economic inequalities. These were among some of the characteristics of the economy, and acted as a deterrent to growth, economic development, employment creation and poverty eradication.

The hon President, Thabo Mbeki, the President of the country, had to make a statement in a conference in 1999, and I quote:

Five years after the arrival of a democratic order, we have not made much progress and may well be marching backwards with regard to the deracialisation of productive property. Clearly, something is not right.

The systematic dispossession and disempowerment of black people, meaning Africans, Coloureds and Indians, that has defined South Africa for so long, requires an equally systematic response from government in order to achieve redress, particularly in the context of globalisation and the need for accelerated economic growth to eradicate poverty in our country.

Since 1994, the government has taken many steps to transform the economy and has set the foundation for a focused strategy of broad-based black economic empowerment. We welcome efforts by the Department of Trade and Industry to introduce codes of good practice. They provide necessary enforcement and compliance mechanisms to ensure true black economic empowerment.

The codes of good practice will be binding on all organs of state and public entities. The codes’ application should cover procurement, licensing and concessions, public-private partnerships, and the sale of state-owned assets or businesses.

All private companies must apply the codes if they want to do business with any government enterprise or organ of state. Since preferential procurement effectively impinges on most private enterprises throughout the chain of supply, all companies in South Africa are encouraged to apply the codes in their interactions with one another.

Broad-based black economic empowerment cuts across all government departments and the private sector. Compliance to these codes is compulsory to avoid fronting and narrow black economic empowerment of a small elite.

We look forward to the department providing leadership co-ordination and reporting to Parliament on the successes and challenges in the implementation of broad-based black economic empowerment.

Hare bua joalo Modulasetulo re bua ka matsatsi a mang kapa matsatsi ohle. Dikomiti tsa Palamente ha mmoho le Palamente di ntse di bua le mafapha a mmuso ka ho fapana, mme re batla ho tseba hore na tse la eba e tsamaileng ke e kae, ho bona hore broad-based black economic empowerment e ya bathong. Bona ba tla bua hangata ka hore Economic Black Empowerment e teng. Empa ha o botsa hore na ke dikhapani tse kae tsa batho ba batsho tse fumaneng thuso ho tswa mmusong? Ba bolela hore di 12 kapa di 14. Ha o batlisisa hore na ke dife ho thoe ke hona re tlatla re bona hore na re fana ka repoto komiting.

Ho bolelang hore hona le dintho tse ding tse etsahalang ka hara mafapha a mmuso moo o fumanang hore ho sa ntse ho fumana batho bane ba neng ba ntse ba fumana mehleng ya apartheif. Kapa haeba ele batho ba batsho ka ba palo e nyane feela.

Lefapha la trade and industry le thwanetse hore e etse ka maatla ho bona hore na ho etsahala joang, ka pa mmuso ka bophara e be yona e bonang hore na mosebetsi ona o tsoela peele. Mme o putsa batho ba ronga ba dikobo tse mahetlang. (Translation of Sesotho paragraphs follows.)

[Chairperson, we refer to other days or all days. Parliamentary committees and Parliament are still engaged in talks with different governmental departments, and we would like to know about the progress made, so that we can ensure that broad-based black economic empowerment goes to the people.

They will always say that black economic empowerment is a reality. But when you ask them how many black companies received help from government, they will say approximately 12 or 14. When you ask which those are, you will be told that the report will be given to the committee.

This means that there are certain things that are happening in government departments and you’ll find that those who benefited during the apartheid era are still benefiting. If the beneficiaries are black people, they are of insignificant number.

The Department of Trade and Industry should do everything in its power to ensure that it happens, or the government should see to it that this is a success and that our people, the poorest of the poor, benefit.]

In conclusion, we commend the Department of Trade and Industry, especially … [Time expired.]

Mr R B BHOOLA: Chairperson, hon Deputy President, the budget increase of 16,5% for the Department of Trade and Industry and the division of these funds among its seven programmes are undoubtedly supported.

With well-suited trade agreements conveying a great relation of import and export on South African shores and government’s policies in place to maintain these relations, South Africa is emerging as a great power in the market. We have just had our honourable President seal relations with Italy, which is South Africa’s third largest investor. But while these trading agreements may yield benefits in some relations, much concern is expressed with China where we are posed with a threat of cheap Chinese imports affecting our market.

We hereby seek that trade agreements need to be strictly monitored and devised to the benefit of our economy and that all trade agreements are in compliance with the development endeavours of Nepad. However, it is established that South Africa’s reputation as having a strong global trade is dependent on a strong and stable domestic market.

The MF acknowledges the Microeconomic Reform Strategy as a great means to attaining this progress, development and stability. We request funds to be appropriated effectively to ensure the efficient mobilisation of this.

Furthermore, Asgisa is a crucial intervention in ensuring that poverty and unemployment are halved by 2014. And while challenges exist, Asgisa’s agenda is set to deliver if firmly entrenched.

However, the development of the domestic market, poverty alleviation, as well as employment initiatives are dependent upon programmes such as SMME and BEE to open roads for success. The MF hereby requests that such progress be monitored and audited upon scales of urban and rural development.

More importantly, sustainable growth, employment and redistribution are dependent on skills development and empowering market accessibility to the previously disadvantaged. Initiatives with educational institutions to promote the supply of skilled persons in sectors … [Interjections.]

The Minority Front supports the Budget Vote. [Time expired.] [Applause.]

Mr L B LABUSCHAGNE: Hon Chair, hon Deputy President, hon Minister and hon members, last week we celebrated Human Rights Day and also passed the Older Persons Bill, which strengthened our constitutional commitment, particularly the rights of the elderly, and protected our senior citizens from abuse.

Mr Minister, you may wonder what this has to do with the budget of Trade and Industry. Well, there is a matter of abuse of retired persons that falls within the responsibility of your Ministry and department. I am referring specifically to your responsibility for consumer protection and the administration and regulation of Act 65 of 1988 – the Housing Development Schemes for Retired Persons Act - and abuse of the elderly due to the dichotomy between this Act and in particular the Sectional Titles Act of 1986.

Mr Minister, your answer to my question No 27 - when I asked whether you had received a memorandum in this regard or were aware of the matter - was negative. Mr Minister, if you were not aware of the problems your department certainly was. Let me thus enlighten you. In November 2003 members of your department attended a meeting of the interest group for retirement villages - an association representing some 44 retirement complexes in Gauteng, Limpopo and the Free State, some thousands of senior residents. Your officials indicated that a memo was being prepared for the Minister on the problem and it, according to your parliamentary answer, never reached you. [Interjections.]

The HOUSE CHAIRPERSON (Mr G Q M Doidge): Hon member, please take your seat. I think we should suspend business at this point. I do not think that it is fair to the member with that interference going on. The bells will be rung and when we are ready to convene again, we shall get the bells rung. So, do not disappear forever. Thank you very much.

Business suspended at 16:24 and resumed at 16:58.

Mr L B LABUSCHAGNE: Hon Chair, it is not often that a political speech is interrupted by Kellogg’s Rice Crispies’ “snap, crackle and pop″. So, I’ll start again for the benefit of those who were asleep and a little emphasis for those who suffer from short-term memories. Last week we celebrated Human Rights Day and also passed the Older Persons Bill, which strengthened our constitutional commitment, particularly the rights of the elderly and protected our senior citizens from abuse.

Mr Minister, you may wonder what this has to do with the budget of Trade and Industry. Well, there is a matter of abuse of retired persons that falls within the responsibility of your Ministry and department. And I’m referring specifically to your responsibility for consumer protection and the administration and regulation of Act 65 of 1988 - the Housing Development Schemes for Retired Persons Act - and the abuse of the elderly due to the dichotomy between this Act, and in particular the Sectional Titles Act of 1986.

Mr Minister, in your answer to my question No 27 – when I asked whether you had received a memorandum in this regard or are aware of the matter - your answer was negative. If you were not aware of the problems, your department certainly was. Let me enlighten you. In November 2003, members of your department attended a meeting of the interest group of retirement villages, an association representing some 44 retirement complexes in Gauteng, Limpopo and the Free State - representing some thousands of senior residents. Your officials indicated that a memo was being prepared for the Minister on the problems and it, according to your answer, never reached you.

In July last year I visited your department and spoke to your consumer division, handed in copies of the concerns and asked that the memo be revisited and dusted off and revisited. I understand there had been staff changes, and I note from your answer to another of my questions that your department hasn’t had an average vacancy rate of more than 32% over the past three years. So, I appreciate the difficulty and the fact that the so- called transformation policies of the ANC are having an effect on the efficiency of your department. But I digress.

Problems that many retirees are facing is this dichotomy that arises when a retirement complex has some units, which are being regulated by the Sectional Titles Act, and others by the Housing Development Schemes for Retired Persons Act of your department, under which Act units had been alienated as life rights and where the residents have no say in the management of the complex. This opens doors for exploitation of these vulnerable people by unscrupulous developers.

Let me illustrate this abuse with an actual, and not isolated, example. In Pretoria, for example, we have a complex of some 150 units under life rights in terms of your Act. Retirees bought these for about R60 000 to R80 000 at the time, with a small levy of about R200 per month. In terms of the Life Rights Act, should they leave or die, they would only get their money back. Now some 15 years later, the developer has kept on raising his levies – they are now over R1 000 per month. Pensions lag behind, thus they cannot afford either to stay or leave, because they would only get back the original R60 000 to R80 000 and the units are going for over R300 000. Developers can make a killing. Moreover, the holders of life rights are excluded from the management of the complex because what happens is that they register a few units under the Sectional Titles Act and administer the complex under this Act, and the developer takes the 150 votes for the life rights people.

Mr Minister, there are complexes that have life rights and are administered properly with full participation of the residents. The problem is that there are those who exploit the conflict between these two Acts to the detriment of the elderly. This can only be rectified by either legislation or regulation, which is in your hands.

Mr Minister, I accept many tasks have kept you in ignorance of the problem, and that you are now hopefully aware of it. I have also written to the chairperson of our portfolio committee in this regard, requesting hearings. But in the final instance, as Harry Truman said: ``The buck stops with you’’. I really sincerely request that you be seized of this matter and give it your urgent attention.

Retirees, unlike many of us, do not always have the luxury of time. Regarding your invitation today - and others mentioned the age of hope - well, I would like to say let’s go further and let’s give substance and delivery to the age of hope for this people and help them.

Thank you, Chair. [Applause.]

Prof B TUROK: Chairperson … [Applause.]

HON MEMBERS: Malibongwe! [Praise!]

Prof B TUROK: Thank you very much. I have been seriously disadvantaged by technology. When I was listed to speak, the person in charge of the House was a woman, and the Deputy President who was here was a woman and I was very happy about that circumstance and I have now been seriously disadvantaged, because I want to talk about women.

I want to talk about the role of women in the economy. Let us be honest in admitting that most women in South Africa remain hewers of wood and drawers of water. They receive very little recognition for the unpaid work that they do. Our institutions of state do not give adequate recognition to what they do and how they live. And women exist largely, as our Deputy Minister Thabethe said, within the confines of the second economy in which their contribution to the real economy is unseen.

Indeed, what we are struck by, as the Deputy Minister indicated, is that there is a lack of respect for the majority of the women of South Africa and for their human rights. They are members of our society. In fact, they make up the larger portion of our society. Our failure to recognise their human rights is particularly blatant when these women suffer sexual abuse or rape, as is the case in a court case before us this very day.

Rape violates the human rights of women and should be condemned by society in the strongest possible terms. And, in case members of the House are not aware of this: This morning the judge in the case in Johannesburg disallowed the request for the dismissal of the charge and so the case is proceeding. Personally I want to say that I welcome that judgment very much because, clearly, a single woman has been subjected to the most serious violation of human rights in that court, and I think this House should take note of that.

I want to say, with respect to this particular debate now, that we have to give great credit to the government and to the Department of Trade and Industry for recognising that there is a structural fault in our society caused by apartheid, but which continues to a degree now, and millions of people and particularly women are trapped permanently in exclusion and marginalisation. We – and the department - must take cognisance of that and make remedial measures available as soon as possible.

Let me indicate the scale of the problem. There are 15,8 million people in the former homelands, and 9,2 million people in our urban townships. Of these 14,8 million people are in the working age group of 15 to 65, and there are 2,1 million people unemployed in the former homelands and 2,3 million people unemployed in the townships.

That means that we have a major part of our society of people of working age who are unemployed, both in the rural areas and former homelands, and in the townships. What is urgently required is that we take remedial measures that are targeted directly at them. Let me say that the statements by the Minister and the documents before us in the Budget Vote do express themselves very explicitly on what measures should be taken.

But I have to refer very quickly to the proposals and the issues that came from the other side of the House this afternoon. Let me say very quickly that the DA’s participation in this debate has been extremely disappointing. [Interjections.]

The hon Dr Rabie, when he came to speak on behalf of the DA, had a number of propositions to make. I’ll deal with them very simply and very quickly. The first one was that he wanted privatisation of parastatals. The second one was that India and China are threats to South Africa. The third one was that we should abolish the willing-buyer, willing-seller principle. All these are private sector proposals, which are in fact rejected by certain sections of the private sector, but represent an ideological bankruptcy that really does not belong to the current period of South African debate.

The hon Mr Labuschagne also came up with the issue of retirement complexes, which is really a very marginal issue to this debate, but I also want to comment on the way he treated this. [Interjections.] He showed such a bias in favour of a certain small section of society, whereas this debate is about our society as a whole and about our economy as a whole.

Let me say immediately that I am very sympathetic to the retirees. I am almost a retiree myself. [Interjections.] I am very sympathetic to the retirement complexes, but can’t we have a more balanced approach to the economy and to our society than this marginal nit-picking, tiny sort of parochial approach that comes from the DA? [Interjections.] And, really, they ought to be ashamed of themselves.

The economics of South Africa are not easy. We do have a dilemma. We have a dilemma in that we can choose from three paths. The first path is to concentrate totally on the first economy – that we concentrate on our industrialisation, that we concentrate on our mining sector and hope that that will somehow change South Africa through a growth path. That is one way.

The other way is to direct massive resources at the poor by welfarism, or by any other schemes and try to throw a lot of money at the question of poverty and unemployment in the second economy and in particular at women, as I indicated. This, in the hope that by throwing a lot of money at that sector, they will flourish and then South Africa will have a much fairer and much more equal society.

I believe we should do both. We need a strong industrial sector. We need a strong mining sector. We need a highly developed technological sector. We need that very badly indeed, because we are living in a very competitive world environment and we have to do what we can to compete and to be right up there as an advanced economy.

But we must also do the other thing, and that is the second economy. It seems to me, with great respect to the DTI, that I have a feeling that they are not doing enough in that direction. For example, if you look at the Budget Vote you will see that for enterprise and industry development, the estimate of expenditure on enterprise development is R103 million, and the estimate of expenditure on equity and empowerment is R177 million.

If one does a further analysis of actual allocations, you will see that in my view, given the problem we have of poverty, of underdevelopment, of women who are not counted, but whose contributions to the economy and to our lives are so major, that there is an insufficient allocation of resources in that area.

We must understand that we do want to have a single, unified, integrated economy in South Africa with no marginalised people and no marginalised sector. But we cannot have that by one set of policies or another set of policies, without having a sophisticated combination of both. So, I want to say, let us try to put far more emphasis on raising the micro area in which women are engaged, in which the rural areas are involved, in which the townships are involved. Let us do far more in concentrating on that area of our society and of our economy so that we do ensure that things change.

The DTI has set up a number of agencies, about which we have heard today. There is Seda, Khula, the IDC and many others. But those agencies do not co- ordinate themselves. They exist in silos. They do not co-ordinate. They do not have a single programme.

So it seems to me that the DTI must be much more forceful in saying to those agencies that we want a co-ordinated approach on the second-economy issue to ensure that the women see their rightful place in South Africa and in the economy, to ensure that their human rights are respected, to ensure that they are respected as persons and as a category of South Africa. It seems to me that if I can get that message across to you, then I have said something perhaps that is useful in this debate.

I thank you. [Applause.]

The MINISTER OF TRADE AND INDUSTRY: Chairperson, I thank all the hon members who have participated in and supported this Budget Vote. I think that the fact that this Budget Vote has enjoyed general support from all of the parties is an indication that we are moving in the right direction in dealing with the challenges of our economy. I think that it also represents a level of maturity in how we are engaging in the economic debate in South Africa.

Of course, I will spare you a little bit, hon Rabie, because I think that you said some good and correct things. For instance, you stated that the World Trade Organisation talks are political, and not technical. That is a point we have raised consistently. Issues are dealt with in that forum as if they were just technical difficulties of formulas and so on, whereas it is the political will that is required to eliminate the subsidies and the challenges mentioned by Deputy Minister Davies.

I think hon Rabie was also correct in emphasising the role of education and skills development. I’d also add exposure to and experience in small, medium and micro enterprise development. This is what these codes of good practice are all about; they are about broadening the scope of empowerment and ensuring that we anchor our empowerment processes on those kinds of issues, ensuring that companies train and skill their employees and that they open up procurement opportunities for them. That is an issue that I would agree with. Hon Rabinowitz – I think she’s not here any longer, and she did send a note to the effect that she isn’t well – raised a point about the issue of alignment between credit and consumer initiatives that we have taken. I would like to say that that is precisely what we are doing.

We are doing something new in South Africa, through the Consumer Bill, which is to provide an overarching framework for consumer rights and consumer protection. And we expect everybody, the private sector, government, local government, and so on, to make that a reference point. If we are delivering particular services as local government, we have to be aware that we have to do that within the framework of consumer rights and consumer interests.

The Credit Bill is effectively a consumer protection intervention on the part of government, because of the abuse of our people at the hands of microlenders.

Let me also say that I think that Deputy Minister Davies dealt quite adequately with the issue of the Sacu-US free trade agreement. Essentially it is the difference in approach that is bogging down negotiations in this regard. However, I would just like to say that we remain committed to the negotiations. We wish that the US administration could show some degree of flexibility and take a developmental rather than a mercantalist approach to the negotiations with a developing region such as the Southern African Customs Union.

Regarding some of the issues raised by hon Greyling on the rail network and services, of course this is what Asgisa is all about. We must be able to make interventions that help to improve our network industries, our logistics and, broadly, our infrastructure. So, he is right on target because that’s what Asgisa is trying to do.

Regarding services, we have actually done and completed the work on a services strategy for South Africa. That document will be going out for public consultation in a very short while.

Regarding the issue of engagement with China, this is, of course, a tricky issue, because you’re dealing with a powerful country in all respects. It is powerful in the sense that it is a major magnet for investments, and so on. However, it is also a country that demands a lot. They also demand a lot of things from us and we do provide them with the many commodities that they need.

China is also a very strong country in terms of its outreach and in terms of the reach of its own exports to the entire world. And so it’s not just poor South Africa, but also the United States of America, the EU, all the regions of the world, everybody, that has to come to terms with this reality. So we are trying to be smart in the way that we engage with the People’s Republic of China. At one level we are engaged in discussions around coming to some agreement on the clothing and textile sector. However, we are also looking at whether, considering the trade relationship that exists currently, we can be able to do something more than just exchanging goods, and so on. So this is an issue that we have to engage China on, in a smart way. I don’t think that it’s going to help us to treat China as an enemy, because I don’t think that would be a correct approach.

Regarding Ipsa, a point raised by the hon Dudley, I think that the process in this regard is evolving. Largely, at the beginning it was engagement among foreign affairs ministers and departments. But now we are cascading this, because as we speak there’s an Ipsa forum taking place in Brazil. It is focusing on economic issues. So this is an evolving relationship, and we think that we will be able to realise particular benefits out of it.

Let me also just say that what we have currently with Mercosur, as Sacu, is a preferential trade agreement on about a thousand products. So anything that is outside of that will be subject to the normal tariff regimes that exist in the different countries.

We hope that we will be able to cascade this to include more and more products. In that way we can then be able to deal with some of the concerns that hon Dudley had raised.

Let me just say, on the issues that were raised by the hon Sisa Njikelana and hon Paul Sefularo, that a lot of them relate, really, to what, in our own review as the DTI, we can do to enhance the capacity of the department. Firstly, it’s important to say that yes, the functions and responsibilities of the Department of Trade and Industry are huge, complex and multifaceted, but are interrelated and interconnected.

Part of what we have to do, in the way in which the Department of Trade and Industry functions, is to deepen integration among the divisions in the department and the Trade and Industry institutions in order to realise maximum benefit from all the capacity that we have.

Secondly, we have got to build capacity. And when I say “capacity” I’m talking of your human, skills and financial resources. The mandate of the department has expanded quite a lot. We have got to look quite seriously at whether we are adequately resourced in a meaningful way. Part of what we have realised is that many of our interventions in the early part of our democracy and those made in the economy were correct interventions, but on a small scale. Part of what we’ve got to look at now is scaling up a lot of the interventions that we have been making in the economy.

We’ve got to enhance the partnerships that we enter into so that we are able to leverage other capacities that exist in society. We need to partner universities, to the extent that we need certain expert work to be done. We can’t employ everybody in this world just because there’s a job that needs to be done. So how do we, through those partnerships, leverage those other capacities that exist elsewhere?

I think that the message that we have tried to communicate through the different speeches that we have given here today is that we are making balanced movement and progress across all of these areas. We’ve tried today to present issues, for instance, that would relate to the progress we are making in your first-economy type of interventions, whether it’s in your industrial policy or import parity pricing or the sector work.

Furthermore, we are also making progress in the area of corporate competitive and consumer environment that exists in South Africa, as well as on issues of broadening participation. The issues of the second economy and broadening participation, accepting what hon Turok has said, have actually never enjoyed as much attention as they are getting at the moment.

What we are now going to be focusing on, going forward, is really dealing with the institutional issues in the department and across the COTII agencies in order to make sure that we enhance our capacity to carry out all of the responsibilities that we have.

Hon Chair, hon members, thank you very much for the support you’ve given to the DTI Budget Vote. [Applause.]

Debate concluded.

      CONSIDERATION OF REPORT OF PORTFOLIO COMMITTEE ON PUBLIC


           WORKS - OVERSIGHT VISITS TO THE NINE PROVINCES

The DEPUTY CHIEF WHIP OF THE MAJORITY PARTY: Chair, we move that the report be adopted.

Order disposed of without debate.

Motion agreed to.

Report accordingly adopted.

      CONSIDERATION OF REPORT OF PORTFOLIO COMMITTEE ON PUBLIC


          WORKS - ANNUAL REPORTS OF DEPARTMENT AND ENTITIES

The DEPUTY CHIEF WHIP OF THE MAJORITY PARTY: Chair, we move that the report be adopted.

Order disposed of without debate.

Motion agreed to. Report accordingly adopted.

                         APPROPRIATION BILL

Debate on Vote No 6 – Public Works:

The HOUSE CHAIRPERSON (Mr G Q M Doidge): By agreement, the Minister will be speaking from her seat. We now recognise the hon the Minister of Public Works. [Applause.]

The MINISTER OF PUBLIC WORKS: Chairperson, Deputy Minister of Public Works, chairperson of the Portfolio Committee on Public Works, MECs who are here with us, senior managers from the department, all members of Parliament of distinction because that is what they are, I want to start by saying that we have people to thank who have been sitting here patiently that come from various projects within Public Works. Some of them are from the fire project, from the Sakhasonke project, from the Vukuphile project, and from a home-based care project. They are here with us, and we really want to acknowledge them. [Applause.]

The successful 2004-05 financial year brought us a step closer to our vision of making ours an efficient and effective organisation, as illustrated by the unqualified audit report we actually received this year from the Auditor-General.

In further pursuance of efficiency and effectiveness in line with our White Paper, the Department of Public Works will, at the beginning of April 2006, devolve its leasing, maintenance, property rates and municipal services budgets to its client departments. Capital works budgets were actually devolved more than three years ago.

The motivation for this devolution of budgets is to increase transparency in the budgeting process and to introduce incentives for the more efficient use of resources. The transparency of the budgeting process is increased by ensuring that all the costs associated with a particular service are part of the budget for that service, and the departments will have a much stronger incentive to use office space, water and electricity more efficiently when they have to pay for these resources from their own budgets.

However, the Department of Public Works will continue to render the functions associated with these budgets. Departments will be required to pay the funds back to the Department of Public Works in the form of an accommodation charge made up of an amount for actual leases and an amount for predetermined rentals of state-owned property. Owing to the current underfunding for maintenance, the rental charge for state-owned property will, initially, be very low compared to market-related rentals. The Department of Public Works will therefore continue to manage the expenditure of the funds which it is devolving, but will now manage this expenditure on an agency basis on behalf of the departments.

A trading entity is being established in the Department of Public Works for the purpose of receiving and spending the accommodation charges. This will require dividing the department into two sections, with the planning and operational units falling under the trading entity, which will produce a separate annual report. The trading entity will operate as a self- sustaining entity, with the costs associated with the planning and operational units of the department being included in the accommodation charges.

The trading entity will be fully established by 1 April 2007. I would like to acknowledge the co-operation and assistance being provided by the National Treasury for the establishment of such a trading entity.

On the request of the SA Police Service, we have agreed to delegate some custodial responsibilities, including construction and maintenance, for police stations to the SAPS as from 1 April 2006.

My department has been allocated an amount of R3,8 billion for the 2006-07 financial year. This amount represents a decrease of R2,8 billion compared to the previous year, which is attributable to the amount devolved to the national departments, in line with the process of introducing accommodation charges referred to previously. Public Works has been allocated R500 million to capitalise the trading entity, and these funds will be used largely for maintenance. As a result, taking into account revenues to be received from client departments through accommodation charges, Public Works will spend approximately 50% more on maintenance in the next financial year than it spent this financial year.

We anticipate that this increase in maintenance expenditure will continue into the future, as the accommodation charges are gradually increased towards market-related levels. We are confident that we shall have the capacity to spend these additional funds, as this year will see the department achieving another 100% expenditure of its allocated budget.

Earlier this month in Bloemfontein the department formally launched its Zimisele or “Give it your best” service delivery improvement programme. This is a comprehensive turnaround programme aimed at introducing more businesslike management methods into the department, so that the department will become a service provider of choice for our client departments. A three-year plan for rolling out the Zimisele programme is under way in the department, and service delivery improvement facilitators have been appointed internally and are currently undergoing training.

Public Works is responsible for the management of three public entities, namely the Construction Industry Development Board, the Independent Development Trust and the Council for the Built Environment. It transfers funds to the CIDB and CBE, and receives regular reports and carries out its oversight role in terms of the Public Finance Management Act. During the course of the next financial year, the department will carry out a performance review of these entities in line with the obligations of the PFMA.

The Government-Wide Immovable Asset Management Bill has been tabled in Parliament, and the department is already starting to put in place immovable asset management plans for government departments. As a result of this improved planning, the fiscus will benefit from a reduction in the overall cost of service delivery coupled with reduced demand for new immovable assets. The asset management plan for the Department of Home Affairs is currently being finalised, and the plans for the remaining client departments will be completed during this calendar year.

In an effort to further improve the utility and compliance of our immovable asset register, the department has recruited 54 young graduates as part of a three-year, R30-million project to collect further information on the department’s properties and enhance the data integrity of the asset register.

An agreement has been reached with the Accountant-General and the Auditor- General regarding the minimum information requirements for immovable asset registers, and this project is focusing on collecting the remaining information that will enable the department to comply fully with these minimum information requirements for all its properties.

At the same time, the department has prioritised the disposal of immovable assets and to date has identified more than 2 000 properties for analysis prior to their phased disposal. Currently, 170 properties are being disposed of under phase one. Subsequent phases will also see the disposal of bigger properties, including the readvertisement for both a 150-hectare property in Midrand and the Blaauwberg property. Badly dilapidated vacant residential properties will be auctioned to accelerate their disposal and save on costs.

Currently, these disposals are being carried out in terms of the Preferential Procurement Policy Framework Act and its regulations, which provide for the allocation of either 10 or 20 preference points for BEE during the tender adjudication process.

However, we are already working with the Department of Pubic Enterprises on a new disposal policy, with the aim of increasing the contribution of the state’s disposals to BEE and of addressing inequities in the property market. A submission in this regard will be made to Cabinet by the end of April.

My department will set up a mechanism similar to a call centre to encourage and invite members of the public to volunteer any information that will help us to prevent the misuse of state properties, including incidents of vandalism, neglect and laundering.

In the forthcoming financial year the department will spend approximately R1,4 billion on leased accommodation from the private sector. In line with the spirit of the recently launched construction and property charters, the department will be developing various mechanisms in consultation with the client departments, existing land laws and financial institutions to encourage the entry of black property owners into this lucrative market. The department will also be communicating its transformation strategies so that the key stakeholders have, at least, a clear understanding of our long- term transformation objectives.

The current boom in the property and building sectors signals the beginning of a period of sustained growth, underscoring the centrality of the construction industry to the Accelerated and Shared Growth Initiative for South Africa. Driven by increasing public and private-sector investment in infrastructure, the construction industry will need to more than double its output over the next 10 years.

Investment growth provides immense opportunities to increase the participation of blacks and women within the industry. The biggest single challenge is to boost the skills and capacity of both the industry and the public sector to deliver the infrastructure that is pivotal to our country’s development.

In this context, the department is working closely with the Construction Industry Development Board and the Department of Trade and Industry on an industrial strategy for the construction industry, with the aim of positioning the industry as one of the growth industries in Asgisa.

In addition, the department and the CIDB are co-ordinating a study to determine the projected skills needs and shortages in the construction industry over the next 15 years. The study is being coupled with an initiative to recruit and train unemployed people to meet the projected skills gaps over time. These initiatives are part of the Joint Initiative for Priority Skills Acquisition, Jipsa, under Asgisa.

This year the CIDB will focus on the development of registered black and women contractors. With over 8 500 contractors now registered in different categories, the CIDB Register of Contractors provides a framework for targeted interventions in terms of finance, training, mentoring and appropriate information and management tools.

Contractor registration is already opening doors to support by banks and financial service providers, as industry moves into a more regulated environment. For example, the National Urban Reconstruction and Housing Agency now offers finance to all registered contractors on public-sector projects provided the tender is viable.

In a relative initiative, Public Works, the Independent Development Trust and First National Bank recently signed an agreement to promote registered emerging contractors on schools and health facilities in the North West and Eastern Cape, with other provinces to follow.

Strengthening the infrastructure delivery capacity of the public sector remains a key objective of the CIDB’s continued roll-out of streamlined and uniform procurement documentation and procedures, and government’s Infrastructure Delivery Improvement Programme, IDIP. The IDIP is a joint initiative of the National Treasury, the Development Bank of Southern Africa, the CIDB and the Departments of Public Works and Education.

It involves introducing improved infrastructure planning and management methods into provincial education and public works departments, with the aim of ensuring that funds are both fully spent and spent efficiently and effectively. As a result of this initiative, the improved working relationship between the national and provincial departments of public works, and departments of education, the problem of children learning under trees will be eradicated by the end of this financial year.

The Department of Public Works has been implementing BEE programmes in the construction sector for some time, including the Emerging Contractor Development Programme, the Expanded Public Works Programme’s Vuk’uphile and venture learnership programmes, and the incubator programme. In order to increase its contribution to transformation, in line with the charters, the department will also establish a similar programme in the property industry.

Discussions are currently under way with a number of high street banks regarding putting in place access to finance for emerging black landlords. This access to finance will be a component of a new emerging landlord development programme, which the department will launch during the coming financial year. The department has also adopted a revised BEE strategy, which includes BEE targets concerning expenditure in the construction and property industries. These targets are in line with the charter targets.

In partnership with the Department of Public Service and Administration, and the City of Tshwane Metropolitan Municipality, the Re Kgabisa Tswane programme was formally launched on 10 November 2005 in response to the Cabinet and presidential call to improve the physical working environment of public servants, as part of Batho Pele. The programme will also contribute to urban renewal and help to position Tshwane as the leading capital in Africa.

The Department of Public Works has developed a spatial development framework and has begun the options analysis process to determine the most appropriate long-term accommodation solutions for the national government departments and their agencies, which will be accommodated in seven precincts, in and around the inner city.

The work of upgrading has started with the R50 million upgrading of the central government offices for the Department of Public Works and the R200 million upgrading of Civitas building for the Department of Health. Construction work for the national library is also under way while work for the headquarters of the Departments of Education and Foreign Affairs is imminent.

The Tshwane municipality is working on plans to upgrade the urban environment and the precincts of the city, particularly those aspects concerning safety and security, recreational spaces, cleaning, and public transport, including feeder systems to the Gautrain. It is estimated that approximately R10 billion worth of investment will be mobilised over a period of 10 to 15 years through the Re Kgabisa Tshwane programme. Many of these projects will be implemented through public-private partnerships.

To date, the Expanded Public Works Programme has surpassed the employment creation targets with more than 220 000 job opportunities created in the first year. At least 40% of the beneficiaries were female. An additional 60 000 job opportunities were created in the first quarter of the second year.

In order to contribute to skills development, a total of 39 provincial departments and municipalities have signed memoranda of understanding with the Department of Public Works and the construction Seta, regarding the training of contractors and supervisory staff in the management of labour- intensive construction projects. This has resulted in the growth of Vuk’uphile Learnership Programme from the initial target of 500 to 2 175 learnerships.

Approximately 40% of Vuk’uphile learners are female and 68% are youth. A total of 3 000 Vuk’uphile learnerships are planned to be running by the end of 2009. I would like to acknowledge the Department of Labour, the construction Seta, IDT and Absa Bank for their efforts in making Vuk’uphile a success.

Public Works is working with the Department of Transport to increase the number and the size of labour-intensive road construction and maintenance programmes in an effort to enhance the scale and impact of the Expanded Public Works Programme, EPWP, as part of Asgisa. Proposals have been made to the National Treasury for additional funding in this regard. An additional R4,2 billion has been allocated to the provinces as part of the provincial equitable share to expand early childhood development, home and community-based care, and those social sector programmes linked to the Expanded Public Works Programme for the 2006-07 period.

Cabinet has mandated the Expanded Public Works Programme’s economic sector through its venture learnership programme to develop and support 3 000 businesses by 2008-09. To date, in partnership with the sector education and training authorities and several provincial and municipal departments, 170 businesses responsible for executing government contracts worth R37 million have participated in the venture learnership programme.

By the end of the 2006-07 financial year, 1 000 SMMEs in total will be assisted through the venture learnership programme. These businesses will be developed in all provinces and will be in sectors such as agriculture, tourism, food and beverages, information technology, wholesale and retail, and waste management. Opportunities for venture learnerships in other sectors where government procures goods and services are currently being researched.

The Expanded Public Works Programme is well on its way to meeting its target of creating 1 million jobs by 2009. I would like to take this opportunity to thank the municipalities, provinces and national sector departments for their efforts in ensuring that the EPWP makes an impact. I would also like to acknowledge the contribution of the Business Trust, whose technical assistance and support to further enhance the impact of the EPWP has been indispensable.

A special word of gratitude goes to Anglo American company for making available more than R6 million towards EPWP-related programmes in rural areas, in support of job creation and poverty. As part of our skills development, our human resources section has been recruiting young women and skilled blacks for placement in learnerships and internship programmes, with the aim of simultaneously addressing skills shortage and employment equity in the department.

In addition, working together with the Council for the Built Environment, the department has established partnerships with tertiary institutions to attract young graduates in order to replenish scarce skills. Internationally, it has linked up with Cuba to import skills concerning the built environment and it has linked up with the United Arab Emirates to identify women for training in project management. These efforts are in line with, and amplify the ideals of, Asgisa.

I think corporate governance is compatible with the administration and the department has developed performance measures and targets for all its programmes as part of its continuous improvement. This balanced scorecard will ensure that our programmes have clear outcomes that are linked to the goals and objectives, as set out in the department’s strategic plan. It will also, by implication, assist with the realignment of our performance to the imperatives of Asgisa.

We have launched a public relations campaign called “South Africa works because of Public Works.” This is part of our earlier undertaking to contribute to socialisation and democratisation through constant public awareness efforts. I invite hon members to visit our stall at the Rand Easter Show this year.

In conclusion, I want to acknowledge the role of the Independent Development Trust in the work of managing development programmes as well as monitoring and assessing their impact. This includes assisting with the maintenance of the state’s immovable assets on behalf of my department, as a contribution to the job creation and skills development objectives of the EPWP. In the next few months, a new board of trustees for the IDT will be appointed. I would like to thank the current board for their contribution.

My sincere appreciation and gratitude goes to the Deputy Minister, Mr Kganyago, for all the co-operation and support, particularly his stewardship in moments of my incapacitation. I also want to thank the portfolio committee for their oversight role, including all constructive input. We commit to nurture this relationship.

The contract of the director-general, Mr James Maseko, ended in January, and I wish him well in his new endeavours. I also want to thank men and women who made us proud while working under the different programmes of the Expanded Public Works Programme. Some of them are here with us today.

I call upon the entire staff of the department to double their efforts in order to realise the aims of Asgisa and other millennium targets. When we say, “South Africa works because of Public Works”, let us always ponder over these words. If I had my way, I would say, after my speech: Elethu! [We all agree!] [Applause.]

Mnu F BHENGU: Igama loomama, nelootata. Mphathiswa, masibulele ngokuba uthe wasebenzisa ixesha lakho walapha kwade kwaleli xesha, ukuze ukwazi ukwenza le nto kuthiwa ngesiZulu “kukuthungela injobo ebandla”.

Andizi kungena kwingcombolo; akhona amahlakani aza kungena kwingcombolo yemicimbi yeli sebe lethu. Ndiyaqonda ukuba aza kuzikhanda, “azibethe kugeme” ngesiMpondo, Mama, kuba ayayazi le nto aza kuthetha ngayo.

Kukho ihlakani apha elikhe lathumela nto ngomhla we-14 kuNovemba/Septemba, efundeka ngolu hlobo: (Translation of isiXhosa paragraphs follows.)

[Mr F BHENGU: In the name of women and men! Hon Minister, we would like to thank you for making yourself available up to this point so that you could share issues with us and together we could solicit ideas about the manner in which such issues should be handled. They say in isiZulu that getting advice from those who know is not to belittle oneself.

I will not go into any details. My colleagues will give a detailed account and share more insight about the work of our department. I am quite sure that they will give a clear account as they seem to be confident and in isiMpondo it is said that the one who beats his chest is the confident one.

On 14 November, one of our colleagues wrote something which read as follows:]

If I could go back and undo some wrongs I have done along the way, and know that wounds that I have caused were healed of all the scars today; if steps I have caused some to take by thoughtless ways in which I have trod have led to a confused state instead of simple trust in God; if someone else still wonders about who followed my unsteady track, and lost his way for lack of light, because my lantern globe was black; if I could gather up and bind the wasted years that I have spent and treat them as if they had never been, today I would be much more content. I am pardoned of my undone past, but even so, the hurt is done, for out there, somewhere in the dark, a soul is lost; I might have won.

This was the hon member Blanché. He dedicated this to the chairperson of the committee on 14 September when we had our portfolio committee meeting.

Chairperson, hon Minister, MECs present, hon members, distinguished guests, government officials, ladies and gentlemen, Public Works is about people at work for shared growth. The Freedom Charter which is an embodiment of the vision of building a united democratic South Africa proclaims: ``All shall enjoy equal human rights’’. Our Constitution’s preamble justly commits and instructs us to heal the divisions of the past, and establish a society based on democratic values, social justice and fundamental human rights, and improve the quality of all citizens, and free the potential of each person. The Accelerated and Shared Growth Initiative for South Africa interprets this clause succinctly.

To achieve this noble cause, we need a collective effort and to understand what we fought for, what we have achieved during the past decade, what the outstanding challenges are that we are confronted with, and tools of intervention at our disposal. What timeframes do we envisage to begin to measure our performance and progress, and ask ourselves whether we have an appealing image to win the confidence of the electorate? Yes, we have the right laws and policies in place. We have a budget to complement our programmes. Indeed, we have the right tools for intervention.

Ezinye zazo zibandakanya i-Expanded Public Works Programme; i-Integrated Sustainable Rural Development Programme, i-Project Consolidate ne-Asgisa. [Some of them include the Expanded Public Works Programme, the Integrated Sustainable Rural Development Programme, Project Consolidate and Asgisa.]

We have Schedule 2 and 3 entities such as the Independent Development Trust, the Construction Industry Development Board, the Council for the Built Environment, the Development Bank of Southern Africa, and the list goes on, who collectively provide invaluable support in our programmes.

We have also civil society organisations, the community-based organisations, the nongovernmental organisations, and women’s organisations such as SA Women in Construction, who add invaluable contributions to our democracy.

Siyaqonda ukuba bakhona apha; siyababulela ngobukho babo. [We do acknowledge their presence here. We thank them for that.]

This then poses a question: Do we parliamentarians conduct our oversight diligently? Do we have the right tools to do so?

The hon Minister of Finance, last week, during the debate on the Division of Revenue Act, posed a question challenging members, saying that: “The Constitution does not expect a lapdog Parliament”. He further said: “Engage us on policy choices we exercise, and ask about the cost of policies”.

He urged members to engage Ministers and departments on their annual reports and strategic plans. Committees should not have annual discussions only, and wait for the Auditor-General’s report. That is what he said.

Members, the portfolio committee, in performing its oversight function in and outside Parliament, was not pleased. I want to report and repeat that. It was not pleased with the quality of support received from the committees section with regard to logistical arrangements, minutes taking, report writing, editing and proofreading. This is an indictment of Parliament, being the highest institution in our country.

Furthermore, it is disturbing when a committee like the one on Public Works does not have a parliamentary researcher two years down the line. We have seen recent advertisements attempting to address this matter, but we plead with Parliament to consider and address these challenges.

Section 92(3) of the Constitution states: Members of the Cabinet must – (b) provide Parliament with full and regular reports concerning matters under their control.

The strategic plan and Budget Vote of the Minister of Public Works are thus a critical pillar in this process as it reaffirms the mandate of the department.

The strategic plan and the Budget Vote create the platform from which we can measure the performance of the department and hold them accountable at the end of the financial year. Last week, from 13 to 15 March 2006, we had a strategic planning workshop with the department and public entities reporting to the department. It took a different approach in that whilst we were interrogating the department on the budget and the 2005-06 strategic plan, simultaneously, the approach was an introspection exercise to evoke the strengths and weaknesses of the department.

Ndiza kuyithetha le nto, Mama. [I am going to talk about this, Madam Speaker.]

We have a note that on 24 March 2006 the department tabled the 2006-2010 strategic plan, signed on 13 March 2006, the same day we were at the workshop with them.

The committee was not informed of this. This strategic plan should have formed part of the strategic plan workshop that we had. The committee will call the department to come and explain this anomaly. We have agreed that we will keep on engaging in this fashion, because the committee was quite disturbed about that.

Nonetheless, the deliberations in the workshop were frank, constructive and enlightening for the committee. It is worth thanking all participants.

As chairperson of the portfolio committee, I can thus confidently state that we have engaged with the detailed planning which supports the Minister’s Budget Vote, except that the department, in its own admission, confirmed that their programmes were still to be realigned with Asgisa. A commitment was made that such realignment would have been completed in a month’s time, and there will be a report to the committee.

As a committee, we are conscious of the fact that we need to be supportive to the Minister and the department and understand their environment while, at the same time, maintaining sufficient distance so that we are able to exercise objectivity in our oversight, and bring the perspectives and expectations of the people who have elected us and the constituencies we represent.

We are also mindful of the fact that there will always be tensions between what the department does and how it views its performance, and how their clients – other government departments – view their effectiveness and performance.

Hence, we are encouraged …

… Mama, njengoko ubusitsho … [… as you have said, Madam Speaker …]

… by the Zimisele turnaround strategy, which the department has introduced. It says to us that the department has taken seriously the challenges within its service delivery model, and what their clients have to say.

We also recognise that the department has introduced a process and programmes with clear targets and deadlines to improve their service delivery. We have noticed that out of 1 074 vacant posts, in the Sunday Times of 26 March 2006, about 30 posts have already been advertised.

The committee recommends that there should be a full complement of staff to ensure comprehensive service delivery, and that all vacancies budgeted for are filled by the end of the 2006-07 financial year.

The committee, Minister, is aware of the fact that in some directorates, there is a shortage of personnel with specialised skills. We trust that the department’s involvement within Asgisa will address this.

I-trading entity, Mama, uTat’ uBheki Radebe … [Regarding the trading entity, Mr Bheki Radebe …]

… is going to speak to it. I agree with you when you say that …

… i-trading entity uza kuyiphehlelela. [… you are going to approve the trading entity.]

I agree with you on the establishment of the trading entity that was prescribed in the White Paper and is in full compliance with the Public Finance Management Act. We anticipate, with interest, its success when it is fully functional.

We acknowledge the appointment of the two Deputy Directors-General for the Expanded Public Works Programme and Asset Management respectively. The two portfolios are crucial in the department’s core functions. I wish, on behalf of the committee, to welcome uTata Bongani Gxilishe who is the EPWP DDG, and Mr Siphiwo Matobela for Asset and Asset Management. The tasks before you are challenging, but surmountable, madoda. We will continue to support you.

The committee has made recommendations on asset management and maintenance in its oversight and annual reports, for whose adoption we will move at the end of this debate. The work that the department is doing around massification of the EPWP to support the objectives of Asgisa is appreciated.

It is, however, critical that the department improves on co-ordination with public entities and other organs of state. The success of the programme is dependent on the role the private sector will play in the implementation of identified projects. It is therefore critical that the department work closely with organised labour, and related industry organisations to ensure that the impact of the programme is sustainable.

We are also encouraged by the budget increase for the maintenance of public buildings. In this regard, we trust that the department will apply the EPWP principles in all the maintenance of public building projects, and that poor people, emerging contractors, and women-owned businesses in particular, will benefit from the work opportunities created.

Siyafuna, Mama, ukuba basondezwe, ukuze xa sithetha ngomcimbi wokugcinwa kwezi zakhiwo zisesimeni esihle bathabathe inxaxheba. [We want to bring them closer and engage them, Madam Speaker, so that they can participate when we are talking about maintaining these buildings.] We would like to see the department setting bold targets.

Kukho nalo mcimbi we … [There is also the issue of …]

… 25% of the programme costs going to beneficiaries. Thirty-five per cent of contracts at national, provincial and local government level, awarded to women-owned enterprises …

Sisindululo esifuna ukuza naso eso, Mama, esicinga ukuba siya kukwazi ukubancedisa oomama nabakhi abasakhasayo phaya ngaphandle. [That is a recommendation we would like to be considered and which we think will also help women and emerging contractors.]

This will enable the committee and other interested parties to measure the progress with which the department is meeting its strategic objectives and the extent to which the department is contributing to the transformation of gender relations and ownership of the country’s wealth in line with Asgisa.

The committee further notes the improved financial accounting system that was subsequently complemented by an unqualified audit report.

Siyancoma kakhulu, Mama, ngokuba sibe nengxelo yoMphicothi-zincwadi Jikelele engena masolotya, emva kwethuba elide usokola, uzama ukulunga- lungisa isebe elo lakho. [Madam Speaker, we welcome the report of the Auditor–General that has found no irregularities after a long struggle you have had in trying to shape up your department.]

The department acknowledges further the interventions of and co-operation given by the National Treasury in assisting the department to improve its financial accounting system. This is in line with the strengthening of intergovernmental interdepartmental relations, which is further enunciated by Asgisa.

I wish to inform this House that, arising from our workshop with the department, commitments were made where the department would provide the committee with quarterly reports on progress made on their programmes.

Xa ndisiya ngasekugqibeni … [In conclusion …]

… on behalf of the Portfolio Committee on Public Works, I wish to extend my gratitude to the hon Minister.

Mama, siyabulela kwakhona. Ndiyafuna ukuyiphinda loo ndawo. [Madam Speaker, thank you once again. I would like to repeat that.]

Also, I want to thank the Deputy Minister, uTata Ganyago, the senior officials of the department for their co-operation and responsiveness to constructive criticism, suggestions and ideas, and quick response to pressure from the portfolio committee members during our interaction in the past year. The committee thanks and wishes the former Director-General, Mr James Maseko, well in his new endeavours.

The committee extends a special thanks to the public entities.

Ndiyabulela, boomama, apho entla, nakuni bootata abakhoyo … [May I thank the women seated up there and the men who are here today …]

… for the support. The mandate of the department and their values should be maximised in support of the Asgisa projects.

Siyafuna ukuba ningene mandla kulo mcimbi we-Asgisa, nincedisane nesebe kwanorhulumente. [We want you, Asgisa, to engage fully and to co-operate with both this department and government.]

Also, the department should ensure greater synergy in programme implementation with those public entities that report to Parliament through the Ministry, and not forget women in construction and other spheres of operation.

The committee supports this budget and further moves for the adoption of the committee’s oversight report to the nine provinces, dated March 2006, and the report of the portfolio committee on annual reports of the department and entities.

Sihlalo, mandibulele, mntan’ eNkosi. Ixesha lixhatshwe yinja; sifuna ukuya kulala ngoku. Ndiyabulela. [Thank you, Madam Speaker. The time has expired. We would like to go and rest now. I thank you all.] [Applause.]

The HOUSE CHAIRPERSON (Mr K O Bapela): Just before hon Opperman comes to the podium, I want to say that I saw that when you were addressing the House, you were looking at the Table. We have listened. We will note them from the Hansard, so you do not have to worry about whether I was listening or not, because there were issues you were emphasising, and you kept on emphasising them. [Applause.]

Mr S E OPPERMAN: Hon Chair, hon Minister, and hon members, today I want to concentrate mainly on the importance of our oversight role and in particular the oversight role of parliamentarians.

Yesterday, during the Social Development debate, we heard from some of the speakers how millions of taxpayers’ money is channelled to the bank accounts of fraudulent claimants. While thousands of officials are implicated, I believe only a few will be used as fall guys, as was the case with Armsgate, Travelgate, and as it will be the case with Kebble-gate, Spygate and all the other gates. The list is endless and it is sickening. [Interjections.] Therefore I have titled my speech this afternoon, “The scum is stealing the cream.”

Die skuim steel die room.

Die vraag is: hoeveel van die miljarde wat deur die Minister van Finansies vir verskillende departemente begroot is, word eerlik spandeer, en hoeveel word deur gewetenlose swendelaars gekanaliseer?

‘n Paar dae gelede het die Ouditeur-generaal gerapporteer dat derduisende staatsamptenare geheime, nie-verklaarde maatskappye besit of bestuur, waarheen – na my mening – miljoene, indien nie miljarde nie, vanuit die staatsfondse gekanaliseer word. (Translation of Afrikaans paragraphs follows.)

[The scum is stealing the cream.

The question is: How much of the billions of rands budgeted by the Minister of Finance for various departments is spent honestly, and how much is channelled by unscrupulous swindlers?

A few days ago the Auditor-General reported that thousands of public servants own or manage secret, undeclared companies, to which – in his opinion – millions, if not billions, of rands are channelled from state funds.]

It is usually these swindlers, now the richest of the rich, who keep on screaming for the rights of the poorest of the poor, while they are the ones who steal money from the downtrodden. Die verslag van die Ouditeur-generaal het ook aangedui dat sekere lede van die uitvoerende gesag maatskappye besit of in direksies sit wat nie deur hulle verklaar is nie, soos die Grondwet voorskryf. Die vraag is, waarom nie? (Translation of Afrikaans paragraph follows.)

[The report of the Auditor-General also indicated that certain members of the executive own companies or are members of boards not declared by them, as prescribed by the Constitution. The question is, why not?]

Your name, hon Minister, is one of those mentioned in media reports. We need clarity from you concerning this issue. As usual, the first reaction of the ANC component of the ethics committee was to shoot the messenger.

The hundreds of billions of rands allocated to the different departments have become the target of the unscrupulous who don’t use AK-47s to get to the money, but who abuse their positions to channel funds meant to better the lives of people, in order to appease their fat-cat mentality.

A few days ago I received an urgent request from a company in George to assist in getting the monies owed to them by Public Works. Why is it necessary for people to go on their knees for monies owed to them? What has happened to the funds that were budgeted for in order to pay the rent? The wake-up call by the Minister of Finance during the Appropriation Bill debate, that Members of Parliament must take up their oversight role, was – although long overdue – a challenge that cannot be ignored. We must not be afraid, he said, to ask the necessary questions.

Departmental officials should be required to declare their interests, as in the case – or was supposed to be the case – with Members of Parliament. This would guard against someone driving a programme where there could be a conflict of interests. This proposal adopted by our portfolio committee on 22 March is spot-on and an indication that we need to take our oversight role seriously.

Madam Minister, you have confirmed this afternoon the rumours that we are, once again, without a director-general. Not so long ago you praised James Maseko’s approach to management and his determination to deal with some of the auditing issues. Thanks to his – what you then called determination – our latest Auditors-General’s report is unqualified, and we want to congratulate James in his absence for this. You also then said that the tide has turned and you said, and I quote: “… without fear of contradiction.”

During the past 11 years, Winkie, there has been a high turnover of directors-general appointed by the department. We view this as a matter of concern because it negatively affects the overall performance of the department. I hope you will take the portfolio committee into your confidence concerning your unwillingness to renew Maseko’s contract. We would like to know what went wrong.

In spite of this setback, we believe that the strategic drivers, namely delivery, capacity building and effective asset management must remain in order to realise the key objectives of the department, which are, firstly, the improvement of the management of immovable properties and, secondly, maintenance as a contribution to economic growth, and here we wish to say that we acknowledge and highly value the input from the Asgisa intervention to address the maintenance backlog through the infrastructure investment programme. We believe that a percentage of the R40 billion that the Minister of Finance wishes to distribute to local authorities can help to accelerate this programme. The DA supports the decentralisation of maintenance programmes.

Thirdly, there is the contribution to job creation in order to assist with poverty alleviation, and fourthly, the transformation of the construction and property industries.

The contribution of the Independent Development Trust to the national development agenda of poverty reduction, capacity building as well as the reduction of infrastructure backlogs is highly valued. We also value the role the Construction Industry Development Board plays in the provision of infrastructure, which is essential for social and economic development. We know it will reach greater momentum through the Asgisa intervention, and will further contribute to assist us in realising our vision and mission.

Madam Minister, we wish you well, we thank the chairperson for his leadership, and we support the Budget Vote. Thank you very much. [Applause.]

Ms I W DIREKO: An objection, Chair. I’d like to know whether it is parliamentary for the hon member to merely refer to me as Winkie, instead of saying hon Winkie Direko. [Laughter.]

The HOUSE CHAIRPERSON (Mr K O Bapela): Indeed, I also heard that and I want to remind members once more that when we hear an interjection, please be respectful. If you want to respond to the interjection, still refer to members as honourable, and “hon Direko” it should have been. So, we hope therefore that every member, as they respond to interjections, will be reminded of that particular Rule.

Mr L D MADUMA: Chairperson, hon Ministers, hon Deputy Ministers, hon members, distinguished guests, this day marks yet another commitment of the ANC-led government to creating jobs and fighting poverty in South Africa. This is a commitment, which was taken in Kliptown more than 50 years ago and which said: ``There shall be jobs and security for all’’. This clause of the Freedom Charter acknowledges that there can be no political freedom without economic freedom. It is against this background that although we attained political freedom, the ANC-led government will continue to fight for the economic emancipation of all our people. The Accelerated and Shared Growth Initiative of South Africa, led by the Deputy President, is a strategic intervention in realising this goal. However, we should not see it as a panacea but as trying to redress the imbalances created by the apartheid system.

When this government took over in 1994, it recognised the strategic position of the Department of Public Works as a catalyst in pushing back the frontiers of poverty and unemployment in our society. Its vision was to promote the broad-based economic empowerment in the construction industry. It was doing this with the intention to bridge the gap between the two economies that continue to separate our society. During the apartheid era, construction industry has been white and male-dominated, and this led to the marginalisation of black contractors, let alone the participation of women, the youth and the disabled in this sector.

It is against this background that the ANC-led government took this conscious decision to promote the emerging contractors. It then entrusted the Department of Public Works with the responsibility to assist the emerging contractors to compete with their established counterparts in the construction industry. This resulted in the emergence of the small contractors, which were competing among themselves with very little scope of growth as many lacked financial and technical capacity. This led to some approaching the established contractors for the expertise, who ended up charging them exorbitant amounts of money. This situation posed a huge challenge to the transformation agenda of the government.

In order to have better co-ordination between emerging contractors, the Department of Public works has established the incubator programme. This is a programme that is aimed at ensuring that emerging contractors are capacitated to manage projects from R1 million to R30 million. The strength of this programme so far has shown its ability to draw a number of women to participate in the construction industry. However, the portfolio committee recommends that the Department of Public Works should develop guidelines so that when these emerging contractors exit the programme, Nepad could be another option.

Also, the resistance of the suppliers of construction materials to participate is a concern to the Portfolio Committee on Public Works. They claim to be governed by the Mine Act, yet they also do business in the construction industry. This is a matter that needs further engagement by all role players. The portfolio committee will be subpoenaing the material suppliers for a briefing and discussions on the matter during the course of this year.

Due to the lack of financial capacity, some of the emerging contractors have opted to get technical support from the established contractors when they get tenders. This scenario has resulted in a situation of having fronting increasing amongst the emerging contractors. This is a situation which continues to undermine the government’s commitment to promote the black economic empowerment in the construction industry. We appreciate it, Minister, to hear that fronting companies have been handed over to the national prosecuting agencies for further investigation. Our recommendation calls on your department, Minister, to table before the portfolio committee an interim report on progress in this matter and other related matters regarding corruption within the department.

Mphathiswa, siyikomiti sithi xa sithetha nezi kontraka zincinci, ngokubhekisele kumsebenzi wethu wokubeka esweni umsebenzi wabaphathiswa, sifumanise ukuba iikontraka ezincinci zinengxaki yesakhono neyokuswela imali yokuqalisa umsebenzi ezithe zawufumana. Ezi kontraka zinkulu zona zibona ithuba lokuba zixhamle kwilungelo ebelifanele ukuba lixhanyulwa ngabantu bakuthi, kwiinzame zokuguqula isimo sokusebenza kwazo kolu shishino. (Translation of isiXhosa paragraph follows.)

[Minister, the portfolio committee would like to report that when we inform emerging contractors about our oversight role and raise these concerns with them, we are told that they lack capacity, technical support and they have financial problems that then put them in a difficult position to initiate and manage their projects. Established contractors, however, see this as an opportunity to benefit indirectly from opportunities that have been created for our people, thereby putting a damper on our attempts to economically emancipate them where construction is concerned.]

The portfolio committee welcomes the initiatives of the Minister of Public Works, hon Stella Sigcau, to uproot this evil of fronting and corruption. During the oversight visits the committee discovered what could constitute fronting. To some it is just a normal business partnership transaction.

Aba nokontraka basakhasayo ababoni ngxaki bona, kuba bathi abanasakhono. Xa sizibuza ezi zinto basibona njengabantu ababasengela phantsi. [These emerging contractors have not been able to see this as a problem because they say that they do not possess enough capacity. They think that we seek to put them at a disadvantage when we request certain information from them.]

We believe that this is one area where the Department of Public Works needs to strengthen its advocacy campaign because,

Kuyabonakala ukuba kuninzi ekufanele kwenziwe lisebe ukwenza oonokontraka abasakhasayo ukuba bayibone ingxaki yoonokontraka abamileyo abasithela ngabasakhasayo, abangayiboni iyingxaki bona. [It is clear that a lot has still to be done by the department to educate emerging contractors about the problem of fronting, which they obviously cannot see.] Whilst we acknowledge that fronting is unacceptable, some of the emerging contractors indulge in this bad behaviour consciously due to the lack of technical skills and financial resources. Financial security still remains an impediment for the emerging contractors, as financial institutions do not view them as creditworthy. The issue of collateral remains a nightmare. This is another area where we would encourage the Department of Public Works to make more interventions so as to ensure that emerging contractors play a meaningful role in implementing the Asgisa programme.

It is appreciated that the Construction Education and Training Authority, CETA, is providing skills to people in this industry. This is an investment we cannot afford to lose, as it brings more participants closer to the first economy. The Department of Public Works should work very closely with this CETA in ensuring that the training programme they provide responds adequately to the skills needed by the industry.

The portfolio committee also views the work of the Construction Industry Development Board as crucial in assisting the grading of contractors and matching their skills. However, we are concerned about the emphasis of the balance sheet and the past experience to manage a particular contract or project. Perhaps more emphasis should be the real partnership so as to ensure that we encourage skills transfer. This is a matter we request the CIDB to explore further. The portfolio committee welcomes the involvement of the Department of Public Works in the technical committee of the 2010 Soccer World Cup bid. This is a programme that would create massive infrastructural development where contractors would play a pivotal role. However, we urge the department to develop clear guidelines in ensuring that emerging contractors are indeed able to compete with the established contractors. One of the key challenges would be the imparting of skills so that they are able to deliver qualitatively.

The portfolio committee welcomes Asgisa interventions in paving the way for participation of women in the construction development. The government is convinced that ``to achieve Asgisa’s goal of halving unemployment and poverty by 2014 we will have to work more closely with women’’. This is an unambiguous position of the government in recognising the role women could play in the economy of this country. We are convinced that in giving a source of income to women you feed the nation.

Wanika oomama ithuba lokuziphuhlisa, wondla isizwe. [When you give women an opportunity to play a role in the economy, you help feed the nation.]

The portfolio committee concurs with the women in construction that the PPPFA point system poses constraints during procurement. However, we recommend in line with our annual report that it should be increased to 35 points. In conclusion, we would also expect the department to assist the contractors that exit the incubator programme to find a welcoming environment. You know, Minister, I worked in the management of a contracting industry. That industry is very cruel, it swears to women. Therefore, when you talk of the exit programme, they will find the big companies out there who will not be friendly to them. And therefore we are urging the department to really monitor that process so that they are not dumped in the deep pool. The time for emerging contractors should be of the past and they must graduate towards a sustainable atmosphere.

The ANC supports this Budget Vote.

Ukwanda kwaliwa ngumthakathi! Ndiyabulela. [Only the wizards would cripple your prosperity! Thank you.] [Applause.]

The DEPUTY MINISTER OF PUBLIC WORKS: Chairperson, the Minister of Public Works, Ms Stella Sigcau, the Chairperson of the Public Works Portfolio Committee, Mr Fezile Bhengu, all the MECs for Public Works from various provinces, hon members, senior management of the Department of Public Works, senior leadership and management of our statutory entities, distinguished guests, ladies and gentlemen, thank you.

As part of the Department of Public Works Budget Vote, it is with pleasure and honour today that I highlight some of the achievements that we as a department have accomplished with regard to the prestige accommodation over the past year. As part of its core functions, the Department of Public Works provides physical accommodation as well as maintenance, and other facilities management services to the national legislature and the executive branches of our government, including the Presidency.

We were able to provide adequate accommodation to the new members of the executive following the reshuffling of Cabinet. This is in relation to the appointment of two new Deputy Ministers of Trade and Industry, for whom we had to find contingency accommodation in the Pretoria-Tshwane area.

We have now managed to acquire suitable residences in Waterkloof, which we are busy refurbishing to ministerial standards. We also managed to house the new Deputy Minister of Correctional Services, as part of our responsibility, as we know that she was recently appointed. Over the past year, we also conducted the refurbishments at the following residences: the Gardens, Laeveld, Newlands House, to the value of R970 000, R1,5 million and R1,4 million respectively.

We allocated an amount of R44 million to Prestige Accommodation to carry out functions such as the interior decoration of ministerial and presidential houses, and the implementation of the repair and maintenance programme. This amount also included the costs of maintaining gardens and cleaning services, all of which are meant to improve the comfort of our most valued residences.

Ladies and gentlemen, I am happy to report that Prestige Accommodation also successfully organised, co-ordinated and managed high profile state events such as the Cabinet lekgotla, the Presidential Youth Working Group, state visits by international dignitaries and similar events. With the assistance of our most committed staff and skilled contractors, we managed to host these events at the highest standards possible.

Together with the Department of Foreign Affairs, the Prestige Accommodation team assisted in the identification and procurement of the buildings that will become the home of the President of the Pan-African Parliament. We registered the said house in the name of the state on 2 February 2004 in Waterkloof, an area that is designated a ministerial ambassadorial area.

I am pleased to announce that over the past year, we upgraded committee rooms for both the NCOP and the NA to the value of R20 million. To ensure the comfort of members as they carry out their responsibilities, we upgraded air conditioning in the National Assembly to the value of R5,4 million. We also upgraded the Cabinet and green rooms at Tuynhuys, and provided media facilities and the radio studio at 120 Plein Street building

• all to the value of R30, 5 million. We also made the parliamentary precinct user-friendlier to the physically challenged at a cost of R5,2 million. In addition to all these, it is important to report that there has been a smooth implementation of the new facilities management contract for public works in the Cape Town regional office.

The current contract commenced on 1 March 2006. This allowed for a transition period of six weeks, following the lapsing of the previous contract with the WSP Sidibene on 28 February 2006. The current contract is valued at approximately R310 million over three years, and entails a more comprehensive maintenance management plan than the previous one.

This includes the conducting of the security screening of any person and company who render or intend to render a service in Prestige Accommodation structures and offices classified as national key points. The aim of this process is to ensure the integrity and loyalty of those who are working in our clients’ residences and offices.

However, the security clearance processes have sometimes proven to be a lengthy process, taking longer than most of our clients can wait. As a result, this has resulted in project delays and often lowers expenditure on budget on major projects. This naturally has resulted in unhappiness among our clients, and they have sometimes vented anger at us due to what they consider to be unreasonable delays.

We would like to take this opportunity to assure our clients today that we are working closely with the National Intelligence Agency to expedite the security clearance process. We will also review our procurement procedures in the hope of speeding up projects delivery process. With your permission, I would like to list some of the challenges facing us as we go forward.

This includes inadequate communication between us and our clients, insufficient funds to address maintenance, the need to upgrade the ministerial handbook to reflect current policy, and the implementation of a furniture policy.

As we move forward into the new fiscal year, we will together ensure that we create positive milestones from the challenges we faced in the previous year. We will pave the way forward for a more efficient management of prestige accommodation.

Amongst other things, we intend to do the following. We will implement a movable asset policy and a movable asset register. We will construct seven new residences in order to bring all Ministers and Deputy Ministers to equitable residential status. We will compile integrated management and conservation plans for the Groote Schuur Estate, Fernwood, and the parliamentary precinct. As we look ahead to the future, we believe that improving service delivery is a key to achieving lasting customer satisfaction. To this end, I am pleased with the introduction of the infrastructure delivery improvement programme in the Department of Public Works. As a result, the Department of Public Works has seen the introduction of a number of initiatives geared towards improving the quality of services provided to our clients.

We will identify and fill all critical positions in line with the infrastructure delivery improvement programme capacitation plan to ensure full capacity within our unit. We have created and filled the post of estate manager who, we anticipate, will be of great assistance in facilitating service delivery to our clients.

We have also planned a major upgrade of the presidential golf course for 2006/07. We have appointed a specialist company, that is Golf Data, to upgrade and improve the presidential golf course, and this project is expected to be completed early in 2007. We are currently busy with the upgrading of the President’s residence in Tshwane.

In the new financial year, we aim to improve the quality of event management services provided to our clients. This includes purchasing of our furniture, including conference sound systems, tables and chairs, etc. Our Cape Town office has made tremendous improvement in attending to prestige clients’ needs, especially maintenance related issues and emergencies. The appointment of the facilities management company, in that office, provided a major impetus to service delivery and improved client satisfaction. It is our plan to appoint a similar contractor in our Pretoria office to ensure similar results.

As a department we believe that we can achieve client satisfaction through continuous engagements with them and/or their representatives. As a result we have established a client liaison forum with all prestige clients, which will meet every quarter to discuss, among other things, issues pertinent to the portfolio and service delivery. With these arrangements, I am positive that we will be able to make client satisfaction a reality.

As the Department of Public Works, we will contribute to black economic empowerment through maintenance, acquiring and management of state property, of which we are custodians. Subsequently, through the provision of Prestige Accommodation, we will contribute immensely towards government objectives of BEE and poverty alleviation. This we will do through the procurement of goods and services from affirmable black enterprises as well as small and medium enterprises.

Together with the emerging contractor development programme, the Prestige Accommodation unit in Tshwane managed to spend 79% of its allocated budget on such enterprises in the previous year.

We remain committed to excellence in standards and the efficient delivery of services to our clients while meeting the socioeconomic challenges of our country today and into the future.

I thank you. [Applause.]

Rev K M ZONDI: Deputy Chairperson, it gives me great pleasure to be able to participate in the debate of the Budget Vote of the Department of Public Works.

No one can dispute the strategic nature and position of the Department of Public Works in holding together the edifice of infrastructure upon which the whole of government operates. The Department of Public Works is charged with a responsibility to provide government accommodation so that government departments and agencies operate in an environment which enables them to provide an excellent service to the public.

The ability of the department to provide such a service depends upon its ability to attract and keep capable professionals. Uncompetitive salaries and unattractive working conditions within the Public Service militate against this as these professionals are continually being poached by the private sector which offers them better prospects and greener pastures. This cripples the department’s ability to optimise its service provision. We therefore call upon the department of Department of Public Service and Administration to review packages for professionals employed by this department so that it is able to provide the strategic service across the whole of government.

The Department of Public Works has spearheaded efforts to alleviate poverty since 1994, through programmes such as its erstwhile community-based public works programme. However, the department was subsequently tasked to go beyond that to conceive and establish the Expanded Public Works Programme in order to bridge the first and the second economies.

Now the department is further challenged to so align its programmes that it makes a meaningful contribution to Asgisa.

While the EPWP has taken off very well in that it has been able to create up to 200 000 job opportunities in the first year of its existence, which has gone beyond the target of 130 000 jobs annually, a concern must be expressed here that other government departments charged with the provision of infrastructure have not fully co-operated to make the EPWP a strategic and central focus of government to reduce poverty and generate employment opportunities.

Whereas provinces and municipalities are autonomous spheres of government, co-operative governance should constrain them to make meaningful contributions to the EPWP so that its impact could be heightened. We call upon the department to exercise firm leadership to ensure proper co- operation and co-ordination so that the EPWP becomes a mandatory method and strategy for the provision of infrastructure, the generation of employment opportunities and the acquisition of new skills by unemployed people.

We notice that one of the priorities of the department during this financial year is the improvement of service delivery, especially to its client departments and agencies. This is of crucial importance, particularly in the department’s accommodation-related programmes. We should disabuse the tendency of some government departments to seek to establish their own mini-public works units, as this would erode the core mandate of the department.

The public works departments across government are the central points through which accommodation related services are to be provided since these are well positioned and qualified to do so. We call upon client departments, particularly in provinces, such as the departments of education and health, to focus on their key mandates and to desist from wanting to establish their own mini-public works units as this can only lead to inferior service delivery standards in the long run.

Affirmative procurement should continue to be the central thrust through which the department acquires services from the private sector. This must be a deliberate strategy to bring black people into the mainstream of the economy, particularly in the construction industry and in the property sector. The construction industry development board must continue to explore innovative ways to bring small and by definition black contractors into the mainstream of the economy.

We applaud steps taken by the department to transform the property sector and the recent development towards the realisation of the charter for the property sector. We hope that the major and established role-players shall willingly come on board in the interests of the long-term survival of this sector of the economy, as it is crucial that those who were in the past excluded from meaningful participation are taken on board.

We are heartened to learn of steps that the department has taken to expedite the compilation of the asset register. The ability of the department to go over this hurdle will go a long way towards putting in clearer perspective the status quo of the state’s immovable property portfolio. We do not underestimate problems that impede this achievement, however. It remains a challenge which must be overcome.

Finally, we applaud the dedication of the Minister and Deputy Minister to this crucial portfolio and for their exemplary leadership under very difficult and challenging conditions. We in particular wish you, hon Minister, strength and good health as you continue to steer the department to new and greater heights. We therefore, have pleasure in supporting this Budget Vote. [Applause.]

Mrs T L P NWAMITWA-SHILUBANA: Nkulukumba Mutshami wa Xitulu, muchaviseki Holobye na ndzhawulo ya wena na vavhaki hinkwavo lava va nga kona kwahalano, ndza mi losa. Namuntlha lembe leri ra 2006 a hi fanele hi hoyozela leswaku mfumo lowu wu na expanded public works programme. (Translation of Xitsonga paragraph follows.)

[Mrs T L P NWAMITWA-SHILUBANA: Mr Chairperson, hon Minister and your department and all guests present here today, I greet you. Today, in this year 2006, we should be celebrating the government’s Expanded Public Works Programme.]

If I were to speak in my language, when I say “ku hoyozela” [to congratulate], it would be “hoyohoyo” [congratulations].

HON MEMBERS: Hoyohoyo! [Congratulations!]

Mrs T L P NWAMITWA-SHILUBANA: The previous regime dealt with the minority, but the ANC government deals with the majority.

Expanded Public Works Programme yi nyika mintirho eka vamhani le kaya na vanhu hinkwavo, leswaku yi ta hunguta vusweti. Hi ri Komiti ya Mintirho ya Rixaka hi fambile swifundza hinkwaswo swa kaye tani hi pfhumba ra hina ro kambela hi vona ku ri xana nongonoko lowu wu famba kahle ke? Hi kumile leswaku Expanded Public Works Programme vandzawulo va yi khomile hi mavoko mambirhi. Yi endla mintirho, yi endla leswaku vanhu va suka vusweti na hina hi tivona leswaku a hi mahlampfa etikweni ra hina leri a hi ri mahlampfa. (Translation of Xitsonga paragraph follows.)

[The Expanded Public Works Programme creates employment for women at home and for all people, to alleviate poverty. As the Portfolio Committee on Public Works we visited all nine provinces as a programme of exercising our oversight role to see how effective the programme is. We found that the departments are handling the Expanded Public Works Programme very well. It creates employment, it helps with poverty alleviation and we no longer see ourselves as refugees in our own land, where we were refugees before.]

Mrs S V KALYAN: Madam Chair, can something be done about the interpreting because we would like to fully grasp what the speaker is saying? [Interjections.]

The HOUSE CHAIRPERSON (Ms C-S Botha): Thank you. It’s apparently available but it’s on the wrong channel. It is on the Xitsonga channel.

Mrs S V KALYAN: Thank you very much.

The HOUSE CHAIRPERSON (Ms C-S Botha): Please continue, hon member. Mrs T L P NWAMITWA-SHILUBANA: Inkomu. [I thank you.]

I was saying that in his state of the nation address, regarding the Expanded Public Works Programme, EPWP, the President of the country said, and I quote:

We will continue to pay particular attention to the EPWP as an important bridge between the two economies and a significant part of our poverty alleviation programme.

Nongonoko lowu wa hina wa EPWP wu na swiyenge swa mune, swa miako, swa vanhu, swa mbangu na swa ikhonomiki. Loko hi fambile hi ri Komiti ya Mintirho ya Rixaka hi vonile leswaku swifundza lomu swi nga kona swi khomile phurojekte leyi. Swi hundzuluxa le makaya na le emadorobeni hikuva se vanhu va kuma mintirho. Va swi kota ku vekela vana va vona swakudya etafuleni. Hambiswiritano hi kumile ku ri na swiphiqo swo karhi.

Ndzi tsundzuka loko hi eGauteng- eTshwane laha a hiri kona eStinkwater hi kume leswaku ku endliwa patu kambe 50% ya swa timali yi ya eka maenjinere, leyintsongo yi sala eka EPWP. A hi swona leswi a swi fanele ku fambisa swona eka xiyenge xa EPWP. Hi vonile eku endliwa na mapatu ya va Gundulashu eLimpopo, va Zibambele eKZN na kwalano hi kumile ku ri na swiphiqo. Swiphiqo swin’wana hileswaku vanhu la va tirhaka va ri va hlwela ku hakeriwa, a va hakeriwi hi nkarhi. Xin’wana xiphiqo hileswaku loko ku huma timali kumbe mpimanyeto wa ku endla patu, a hi nge Gungulashu, mpimanyeto walowo wu fanele wu katsa wo ri hlayisa, hikuva loko se patu ri endliwa ri nga ha hlayiseki patu leriya ra hlakala. Na le ka xiyenge xa vanhu, ndzi mi byela ku ri hi na swiyenge swa mune, hi kumile leswaku ku na nhlawulo. Muchaviseki Holobye u vulavurile hi ku pheyivha. Laha a hi fanele ku endla munhu un’we a tirha hi va na vanhu vo tala va nyikiwa mintirho va kota ku hunguta vusweti leswaku loko hi fikela ka lembe 2014 hi va hi hungutile vanhu lava va pfumalaka mintirho.

Ndzi lava ku tiyisisa leswaku xiyenge xa EPWP a hi xiyenge ntsena xa Ndzawulo ya Mintirho ya Rixaka, tindzawulo hinkwato a ti fanele le endzeni ka mimpimanyeto ya vona va vekela mpimanyeto wo karhi leswaku va endla xiyenge lexi xa EPWP. (Translation of Xitsonga paragraphs follows.)

[The EPWP has four sections, namely infrastructure, the social sector, the environmental sector and the economic sector. During our visits as the Portfolio Committee on Public Works we saw that provinces are handling the project very well. It transforms the rural and the urban areas because people find employment. They are able to put food on the table for their children. There were some problems that we noticed though.

I remember when we were in Gauteng - in Tshwane at Stinkwater - we found that during the construction of a road 50% of the money allocated went to the engineers, while little was left for the EPWP. This is not how things should be done in this section of the EPWP. We also noticed some problems with regard to the construction of roads such as Gundulashu in Limpopo and Zibambele in KZN. Another problem is that of late payment to the workers; they are not paid timeously.

One other problem is that when the budget for road construction is released

• let’s say it is Gundulashe - it should also include its maintenance because if the road is constructed and not maintained it wears off. In the social sector - I mentioned earlier that we have four sections - we found that there was an election. The hon Minister spoke about paving. We should not employ a few but as many as possible in order to alleviate poverty so that when we reach 2014 we shall have reduced unemployment.

I want to emphasise that the EPWP is not a programme for the national Department of Public Works only; other departments should also set aside a certain amount from their budget for the EPWP.]

It is not only the Department of Public Works that should create jobs.

I vutihlamuleri lebyi tindzawulo hinkwato eka swifundzankulu hinkwaswo, vamasipala hinkwavo va tinyiketela ka yona leswaku hi ta cinca ekhonomi ya tiko ku suka eka ikhonomi yo sungula ku ya eka ikhonomi ya vumbirhi, hi fambisa na timhaka ka Asgisa.

Ndzi navela ku vula na leswaku hi navela leswaku leswi hi nge i vuhlanganisi na vulanguteri,ngopfu le ka Ndzawulo ya Mintirho, swi kota ku chikela le hansi ka swifundzankulu swi ya eka vamasipala. Mi ta twanana na mina loko ndzi ku vamasipala hi vona va endlaka mintirho le hansi le. Vamasipala hi vanhu vanhu lava tirhaka leswaku vanhu va kuma mintirho. Kambe loko ku nga ri na nkambisiso kumbe vuhlanganisi a hi swi koti ku ri loko se hi ta hlangana na Asgisa hi kwihi hina hi ikhonomi ya hina. Hi ri i ndlopfu ya hina. (Translation of Xitsonga paragraphs follows.)

[It is the responsibility of all provincial departments and municipalities to bring about economic growth in this country from the first to the second economy, as we promote the Asgisa initiatives.

I also want to say that we wish that what we call co-ordination and monitoring, more especially in the Department of Public Works, must be used at the provincial departments and be introduced in the municipalities. You will agree with me when I say that municipalities are the ones which create jobs, and they also contributed to the employment of those who are already employed. But if there is no proper research or co-ordination we are unable to see how we fit into Asgisa and where are we with our economy. It is the responsibility of us all.]

Whilst our government has begun to position women more aggressively in the economic development of this country, women themselves need to take charge of their own economic emancipation. If all programmes of government do not work for women, it simply means that they won’t work for the rest of South Africa.

Regarding SA Women in Construction, who might perhaps be in the gallery, we met with them when we had our workshop. They were facilitating our workshop so we have interacted with them. They emphasised that women should be involved in national infrastructure training programmes. These programmes should especially target women in construction and aim at producing artisans, from plumbers to painters and boilermakers – all the skills that women do not have - so that when the roll-out occurs in construction, those skills that traditionally belonged to men would be available.

We want to recommend to Sawic that, while they should not see themselves as an entity, they should begin to have a policy unit that will also help address challenges facing women as a whole or women in construction. Sawic should begin to have a monitoring unit that monitors the affairs of women in the spheres of economic development, so that women can align themselves with the objectives of Asgisa. Emerging women contractors are sometimes targeted for abuse through fronting for bigger companies because they lack the required collateral. We have many emerging women contractors who are struggling out there. We urge Sawic to avail itself so that it can pick them up in order for them to be aligned with Asgisa.

Empowering women, in particular black women, is an economic factor. By empowering women in this sector, government is including the whole family in economic upliftment, which will result in an automatic multiplier effect.

We urge the Minister and the department to revisit the BEE construction charter in order to introduce a 30% quota focused mainly on tendering regarding women. This we would like to see as part of an urgent amendment of the Preferential Procurement Policy Framework Act. Treasury has issued a notice to deal with the set-asides, making it even more difficult for women to achieve preferential procurement and accelerate shared growth.

Amongst the public entities that report to the Department of Public Works, we acknowledge the contributions made by entities such as those mentioned by the hon Minister, that is the Independent Development Trust, Construction Industry Development Board of South Africa, the construction and built environment sector and others.

We commend the IDT for the unqualified report from the Auditor–General, which is in full compliance with the requirements of the Public Finance Management Act. The involvement of the IDT in order to align itself with Asgisa’s objectives is commended. However, the IDT needs to clarify its relationship with Salga. This is important, so that they would know where the gaps relating to capacity-building lie.

Concerning the Construction Industry Development Board of South Africa, it is seen as a body that transforms the construction industry, but its grading and contractor registration system are stumbling blocks to women empowerment. We recommend that the present grading system be revised. Presently, most women contractors can never ever attain such high grading for bigger projects.

Women consortia also want to be like the Murray and Roberts of tomorrow, but this becomes very difficult with the present setting. While not sacrificing quality, we invite the Setas to come in and do proper training like they are doing with EPWP.

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

Mrs T L P NWAMITWA-SHILUBANA: I support this Vote. Thank you. [Applause.]

Nksz S N (Sylvia Nomatamsanqa) SIGCAU: Sihlalo namalungu ahloniphekileyo, isebe liqulunqe icebo eliziqu-zithathu kwilinge lalo lokufezekisa oko likumiseleyo. Esinye sezi ziqu yimfuneko yokukhulisa ulwazi nezakhono kweli sebe. Siyavuma ukuba oku kubonakala kungxamisekile.

Kuhlahlo lwabiwo-mali lonyaka-mali ka-2006-07 ngaphaya kwezigidi zeerandi ezingama-38,5 zabelwe abacebisi, oonokantraka neenkonzo ezikhethekileyo. Okuxhalabisa kakhulu kukuqaphela inkcitho kwinkqubo yesithathu, ekuyeyona ibaluleke kakhulu, iNkqubo yeMisebenzi yoLuntu eNatyisiweyo.

Apha sifumanisa ukuba izigidi zeerandi ezingama-24 024 000 zichithwe kubacebisi, koonokontraka nakwabeenkonzo ezikhethekileyo. Nangona izizigidi ezili-18 600 000 kuphela imali ebekelwe bucala ejongene nabasebenzi beli sebe, okothusayo kukuba isebe lisebenzise isixa esiphindwe kabini kubacebisi kunyaka odlulileyo. Ezi zixa zibonisa ukuqhwalela kakhulu kweli sebe kwizakhono.

Okuxhalabisayo kukuba isebe liyamkele le meko eyingxaki, yokuswelakala kwezakhono. Ukuba isebe lizimisele ukulungisa le ngxaki, inene kufuneka labe imali ejongene nokuphucula le meko. Ekugqibeleni iindleko zokulungiswa kwezakhiwo zoluntu ziya kuphuma kwirente yabo basebenzisa ezi zakhiwo. Eli licebo elingaba luncedo. (Translation of IsiXhosa paragraphs follows.)

[Ms S N (Sylvia Nomathamsanqa) SIGCAU: Chairperson and hon members, the department, in its endeavour to fulfill its objectives, formulated a threefold plan. One of these folds is the dire need for knowledge and skills development in this department. We agree that this appears to be a matter of urgency.

In the budget for the 2006-07 financial year, more than R38,5 million has been allocated for advisers, contractors, and special services. What is of more concern is the spending on the third leg, which is the most important one, and that is the Expanded Public Works Programme.

Here we have discovered that R24,02 million have been spent on advisers, contractors, and those for the special services. Even though only R18,6 million has been set aside to cater for the workers of this department, what is disturbing is the fact that the department used double the amount on advisers last year. These amounts show an enormous lack of skills in this department.

What is causing concern is the fact that the department accepts this problematic situation with regard to the lack of skills. If the department is serious about rectifying this problem, it should set aside an amount of money that is intended to improve this situation. In the end the costs of maintaining the public buildings should come from the rent paid by those using these buildings. This can be a helpful plan.] Therefore we employ the Minister and the Department to ensure that the property management trading entity is launched successfully.

Ngoko ke sicebisa ukuba ohloniphekileyo umphathiswa aqaphele yaye asebenzise ubuchule ukuseka inkqubo yokuphatha lo mcimbi, njengoko leyo ikwayindlela yokunyusa ingxowa yesebe ngomyinge wama-30 ekhulwini. I-UDM iliqhwabela izandla isebe ngokuqhuba lizisa impumelelo kwiNkqubo yeMisebenzi yoLuntu kaZwelonke. Le nkqubo inyusa kwaye ikhawulezisa ukudalwa kwemisebenzi, ingeniso nezakhono. [Laphela ixesha.] [Kwaqhwatywa.] (Translation of IsiXhosa paragraph follows.)

[We therefore suggest that the hon Minister take note and should be strategic in establishing a programme of addressing this issue, as that will also be a way of increasing the department’s revenue with 30%. The UDM commends the department for continually bringing about success with regard to the National Public Works Programme. This programme is increasing and also accelerates job creation, revenue and skills development. [Time expired.] [Applause.]]

Mr N J GOGOTYA: Deputy Chair, hon members, the Minister, it is a heart- warming experience that we should take part in this debate, but unfortunately, this debate is also taking place under a cloud of some of the happenings of the past couple of days. In the province of North West, where they have had good rains, it was unfortunate that the residents in some of those villages were trapped and they don’t have access to the hospitals and the shops.

There is also a tragic story that was raised. It is a story of a mother who had to carry her dead child, facing the water as she was trying to seek assistance and help. This brings to mind the issues that we are dealing with today. It is unfortunate that one of the unfortunate legacies of apartheid is that it deems the intellectual capacity of people, especially people in the DA, inadequate.

On a cloudless day at midnight they still cannot see the sun. We are dealing here with the realities and the legacies of apartheid, which disenfranchised the majority of people in this country. We still have a person who has hardly attended the meetings in the honourable person of Opperman, who will come here and, like a sangoma, tell us how the meetings were taking place. He never attended these meetings.

I don’t know, I have never heard of a sangoma that “praat”, but he was “praating” [speaking Afrikaans] here. Mina ngithi izangoma azipraati, kodwa lesi siyapraata lesi. [I always thought the sangomas do not speak Afrikaans, but this one does.] [Laughter.]

Colonial and apartheid years were characterised by the relentless exploitation of the masses of our people. Apartheid architects put up governments that were giving skills to and empowering the few at the expense of the many. Not only that, these oppressive regimes inhibited productivity and creativity, and skills development as they intensified and accelerated underdevelopment of blacks and women in particular.

Today the budget vote is about programmes put in place in order to correct this unfortunate legacy. The business of managing the Department of Public Works is akin to the management of any big business. Financial management, in particular, is of key importance, considering the centrifugal role of the department in social development and economic growth.

Since 1999 the department has come three quarters of a circle in the practice of good corporate governance. If the hon member Opperman had attended these meetings and attended the briefing that we had at Caledon, he would have had that information available instead of coming to act as a sangoma here.

Is there something wrong with the seat you are sitting on? If members remember, the review of the department’s 2001 annual report revealed a picture of an organisation that was confronted by all sorts of financial management anxieties, and other operational issues including under expenditure in both the capital works and public works programmes budgets.

There were also serious shortcomings in the department’s system of internal controls, which resulted in supporting documentation for significant amounts and certain critical reconciliation not being available. Furthermore, the overall internal control environment of the department was weakened by a shortage of appropriate skills and high staff turnover.

Because of the significance of the financial matters that were not resolved to the satisfaction of the auditors, the Auditor-General could not express an opinion on the financial statements of the department in that financial year. This challenged the department to throw all its weight behind the internal reforms and set itself together, with its political leadership in the form of the Minister of Public Works, to address that particular situation.

They embarked on that turn around strategy. At the workshop in Caledon, the department assured us that things have since undergone dramatic changes. The department, in response to the Minister’s call for clean governance and zero tolerance to fraud and corruption, identified service delivery improvement initiatives, as well as turning around financial management in all its facets. It also identified some of the key strategic imperatives that had to be tackled with vigour and commitment by all staff.

There is a challenge of efficiency to us, and this efficiency, we suggest, should be through streamlining and the prudent utilisation and allocation of resources. It should also relentlessly pursue the policies of the ANC- led government, transcending free market approaches steeped in selfish individualism. This should be done in order to create a better life for all, and create opportunities to skills and funding.

We also believe that we should move away from that capitalist approach that draws its life from the veins of slave work, slave wages and slave treatment. We are also pleased that this efficiency will also seek to address the issues around corruption, nepotism and self-interest.

Other incremental changes have since been noted, namely, in the financial year 2001-02, the department fully spent its budget allocation and had since maintained this trend.

Incremental year on year improvements were noted in the Auditor-General’s report, and an unqualified audit report was achieved in the financial year 2004-05 for the first time in many years, and the department is committed to maintaining this trend. As a member of the portfolio committee, I have observed with interest the undertakings that the staff of the department had been making to the committee in this regard, and such undertakings had borne positive results.

I am further informed by this department that, in its endeavour to enhance accountability in its functional area, the department will devolve accommodation related budgets to its clients with effect from 1 April 2006. This initiative not only brings about transparency on reporting of the accommodation related costs in the national sphere of government. It will also, in time, revolutionise the planning, accountability and management of the state’s immovable assets and portfolio through the various tiers of government, once the Government-wide Asset Management Policy is promulgated into the Act.

Central to this policy is the need to plan in a holistic manner the operational property portfolio that each organ of state will need in order to execute its mandate adequately. Therefore this policy advocates for the new view that the state property should only be used as a platform for service delivery, and that costs associated with such holdings, which will need to be reviewed periodically, should be measured against the benefits that accrue to the citizens of the country. Hence the need to devolve the accommodation budget to enable the line function departments to make such assessments on properties under their care.

To this end, the department will, on its part, provide guidance to the departments on the best property management practices that will result in optimum utilisation of properties, thereby unlocking the value of such properties. The other issue that I would like to deal with is access to property and land. This is crucial to the economic development of the masses. There is a point that I read the other day that goes something like this:

The seed I have, the plough sheds are mine, the span of oxen is mine, every thing is mine, but only the land belongs to them.

We have everything except the land: plough sheds, seeds and everything, but the land belongs to them. I believe that this policy will assist us in addressing these shortcomings to the benefit of the nation at large. Thank you, we support this Bill. [Applause.]

Mr M T LIKOTSI: Madam Chairperson, we live in a neocolonial state, where the real power still lies in the conservative forces of our former colony, and the economic power remains under the control of international capital. We must, as a nation, exercise the ability to discover and expose the way in which a state becomes neocolonial.

Dr Kwame Nkrumah, a scholar on this subject, informed us of a policy of containment to reduce the impact of the former liberation movements. Some of the tactics include economic devices such as corruption, sabotage and blackmail, as seen in our country today. This is neocolonialism at its best.

With more than 1 000 vacant posts presently, the department may not provide efficient service to the client’s department. The matter of the asset register that this department has been struggling over the 11 years of our democratic dispensation is a matter of concern.

Let us hope that the newly appointed Deputy Director-General will fast track the process, failing which the asset register creation should be outsourced to community organisations. The expanded public works programmes should be revamped to create sustainable jobs. Piece jobs are not a solution to massive unemployment. Provincial governments and public works departments should take full responsibility for defunct project of expanded public works at their respective provinces.

I can see that …

… uSekela-Mphathiswa uKganyago akakho apha. Uthethe kakhulu ngokwenziwa kwamabala egalufa kwanezinye iindawo ezilungiswayo, akathetha ngeendawo zethu ezifana ne-Acacia Park. Hayi, makakhe azame abone ukuba angenza ntoni na ngazo. (Translation of isiXhosa paragraph follows.)

[… Deputy Minister Kganyago is not here. He has spoken a great deal about the construction of a golf course and other places that are being developed, but he made no mention of places like Acacia Park. No, he should try and see what to do about places such as these.]

The PAC supports the Budget Vote. [Applause.]

Ms N M MDAKA: Chairperson, hon members, infrastructure development and maintenance thereof are essential contributors towards economic growth. As part of developing rural economies the Expanded Public Works Programme (EPWP) should harness budding entrepreneurs. It must be said, however, that co-ordination of public works programmes at provincial level is poor, with some provinces far ahead in terms of programme implementation, and others lagging behind or having done nothing in terms of implementation.

Overall progress is satisfactory, with R1,4 billion spent on the programme for creating 82 000 job opportunities by March 2005. But we must realise that the EPWP will not solve the structural unemployment problem. It is a short to medium-term strategy and must be seen as part of a broader government development programme including the recently launched Accelerated and Shared Growth for South Africa, Asgisa.

It is pleasing to see funding provision for border posts, harbours and airports, as these are the areas where substantial bottlenecks occur, which are preventing the necessary efficiency and reducing costs of doing business. The maintenance of state owned buildings needs to be improved. The trend internationally is moving towards government departments buying their own buildings, as there will be cost savings in the long term. We need to carefully evaluate our property portfolio and asset register to enable an effective property management portfolio.

The construction industry needs to transform to get more skilled black civil engineers and project managers, building contractors, etc. Hence, the UIF supports the R55,9 million set aside this year for this purpose. I thank you, House Chairperson. [Time Expired.] [Applause.]

Mnu B A RADEBE: Sihlalo, Ngqongqoshe namalungu ahloniphekile esishayamthetho sikazwelonke, uKhongolose – inhlangano enkulu yabantu, iyasisekela isabelo sezimali soMnyango wezeMisebenzi yoMphakathi.

Ngomhla ka-21 Mashi iNingizimu Afrika yonke yagubha uSuku lwamaLungelo eSintu. Lolu suku lubalulekile ngoba siyazi ukuthi yilo mbuso oholwa uKhongolose owaqinisekisa ukuthi bonke abantu bathole amalungelo alinganayo. Yingakho noMthethosisekelo wezwe, esigabeni sesishayagalolunye eSahlukweni 2 uthi umbuso kumele wenze izaba zokuqinisekisa ukuthi wonke umuntu uyalingana ngaphambi komthetho, futhi bonke abantu babe nelungelo lokuvikela amalungelo abo. Yingakho iminyango yonke kahululemeni kumele ihloniphe la malungelo abantu. Ukuze iminyango kahulumeni iqinisekise ukuthi amalungelo abantu ayahlonishwa, kumele isebenzele ezindaweni nasezakhiweni lapho abantu bezokwazi ukufinyelela khona. Yingakho uMnyango wezemiSebenzi yoMphakathi unegunya lokuqinisekisa ukuthi yonke iminyango kahulumeni isebenzela ezakhiweni ezisezingeni eliphakeme futhi wonke umuntu akwazi ukufinyelela kuyo, ngisho nabantu abakhubazekile.

Ukuze lo mnyango ucwaninge ngomhlaba nangezakhiwo ezifanele, ubeke eceleni izigidigidi zamarandi. Ngonyaka wezimali ka-2004 kuya ku-2005 wasebenzisa imali engango-R1,6 bhiliyoni. Ngonyaka ka-2005 kuya ku-2006 kwasetshenziswa imali engango-R1,67 bhiliyoni yokwenza ukuthi iminyango ithole izindawo zokusebenzela. Kulo nyaka umnyango ubekelwe isamba esingango-R2,37 bhiliyoni. Kusho ukuthi kulolu hlelo isabelo sandiswe ngezigidi eziyi-R700.

Lokhu kusho ukuthini na? Lokhu kusho ukuthi uhlelo lokunikwa komhlaba nezakhiwo ngaphansi komnyango kahulumeni lunyuke ngama-42%. Lokhu kwenyuka kukhombisa khona ukuthi umbuso usabambelele esivumelwaneni owasenza nabantu ngomhla ka-14 Ephreli 2004 lapho kwathiwa kuzoliwa nobuphofu nendlala kwakhiwe futhi namathuba omsebenzi. Phela ingxenye enkulu yalezi zigidi ezingama-R700 izoya komasipala ukuze iminyango kahulumeni ikhokhe intela yomasipala, njengoba uKhongolose eshilo ngomhla ka-1 Mashi 2006 ukuthi unesu lokwenza ukuba omasipala basebenze kangcono. (Translation of isiZulu paragraphs follows.)

[Mr B A RADEBE: Minister and hon members of the National Assembly, the ANC is the party for the people. It supports the budget for the Department of Public Service and Administration.

On March 21, South Africa celebrated Human Rights Day. This day is important because it is the government of the ANC that ensured that people have equal rights. That is why section 8 of chapter 2 of the Constitution states that the state must ensure that everyone is equal before the law and has the right to equal protection and benefit of the law. All the government departments have to respect human rights.

In order for the department to make sure that human rights are respected, they have to work in places and buildings where people will be able to reach them. The Department of Public Service and Administration has a right to make sure that all government departments are working in first-class buildings where people, including people with disabilities, will be able to reach them.

The department has set aside millions of rands to do research about land and buildings. In the financial year 2004-05, we used R1,6 billion. In 2005- 06, we used R1,67 billion to acquire buildings for the departments to work from. This year, we have set aside a sum of R2,37 billion. This means that the budget has been increased by R700 million.

What does this imply? This implies that the programme of giving land and buildings has increased by 42%. This increase shows that the government is still keeping the promise it made to people in April 2004 to fight poverty and to create job opportunities. Part of this R700 million will go to municipalities so that the departments would be able to pay tax so that this is in line with what the ANC stated on 1 March 2006, namely that it has a plan to make municipalities function better.]

In fulfilling the people’s contract to fighting poverty and creating work, the department has identified five key strategic goals in the programme of the provision of land and accommodation for state departments. The first strategic goal is the contribution to the national goals of poverty alleviation and job creation using the Expanded Public Works Programmes in the capital and maintenance budget will do this. We know that in its first year of inception the Expanded Public Works Programme was able to create 130 000 more jobs, which would eventually reach the target of 200 000. This is in line with bringing a better life for all and halving poverty by 2014.

The second strategic goal is to contribute to the New Partnership for Africa’s Development – Nepad - by developing a government asset management in Africa and learning from Africa as a whole. In conflict zones in Africa the department and National Defence Force provides support for the reconstruction and development of the state’s assets.

The third strategic goal is to improve service delivery. Since this ANC-led government came with the principle of Batho Pele, the department ensures that it provides a service delivery programme that will enhance the department’s ability to provide excellent service to the community.

The fourth strategic goal is good corporate governance where the department tries to ensure that it renders a service that complies with asset management principles and also a service that complies with the Occupational Health and Safety, Heritage and National Environmental Management Acts.

The last important strategic goal is to promote black economic empowerment. This will be done by using expenditure in the construction and maintenance, and facilities management to provide black economic empowerment by using preferential procurement policies and identifying historically disadvantaged enterprises as partners in the execution of the programme. The department will also use government participation in the property market to influence ownership parties in the property industry.

Since the delivery processes and accountability to capital and recurrent works the effective use and efficient maintenance of existing immovable assets the department must ensure the highest possible return for the disposal of immovable assets where opportunities aroused while promoting land reform and poverty alleviation.

The Government Immovable Assets Management, GIAM, the framework, which is going to be used to set up a state property agency, will increase the opportunity for public private partnerships in maintenance and management of immovable assets. This GIAM framework will also be made into law before end of the financial year.

Since the department is having the largest list portfolio, which is estimated at 1,6 billion per annum, the Ministry and the department be must congratulated that the property industry is being transformed.

Clause 3 of the Freedom Charter states that: “The people shall share in the country’s wealth!” Eleven years down the democracy lane the property sector remains untransformed and unyielding in transforming itself.

According to the business report of 28 March, the property portfolio increased by 38% in the Johannesburg Stock Exchange, JSE, but what is important here is that the historically disadvantaged people were not part of that because they were not taking part in the growth of the sector. That is why we applaud the Minister for leading the department in adopting the Property Charter.

Why are these black people not so represented in the property industry? This is because of the 1913 Land Act, which defied black people in owning land and in the area where they were settled, the land was held under the tribal trusts, which denied them to have title deeds. This meant that blacks were not able to trade in property. So, this situation led to the black people being minimally represented in the property sector.

The property sector itself is dominated by commercial institutional investors, property loan stock and listed property entities, with the government being the largest commercial player.

It is proper that we congratulate the Minister in spearheading and creating the adoption of the Property Charter, which will ensure that the property payers participate in the transformation of the sector. The Charter has objectives like the promotion of the participation of the historically disadvantaged individuals by applying employment equity in its entirety in the sector. The sector will promote property development investment and investment in under-resourced areas, which will enhance infrastructure and encourage investment in the support of micro and small enterprises.

It will increase the pull of intellectual capital amongst black people by focusing on attracting new entrants and developing appropriate curricula. It will increase investment in skills and training of the existing and new black professionals, and this will encourage procurement of goods and services from the black economic empowerment suppliers. And this will encourage good corporate citizenship by property entrepreneurs by participating in the social responsibility programmes.

The Minister and the department are obliged to help in the land restitution process. The land parcels owned by the department must be made available for restitution purposes, so that the sad chapter of land disposition is closed. This means that the provincial land disposal committees must be capacitated to do their work timeously and effectively.

The redundant state properties must be disposed in such a way that their usefulness or redundancy is established in consultation with the user departments so that the future use of these assets can be assessed.

The last step will be to ensure that this disposal is in line with the programmes of government like land distribution, housing and use of public amenities. Rules must be made so that the beneficiaries cannot easily dispose of these properties. But properties like the old military bases must be disposed of as quickly as possible because in the long run they will pose a threat to the security of this country.

Thank you, Comrade Chairperson. [Applause.]

Mnr J P I BLANCHÉ: Voorsitter, as ek so luister na die vorige sprekers dan klink dit vir my die ANC gaan ons na die paradys toe neem, en ek wil sê, ja, ek glo, want uiteindelik – soos hulle aangaan – gaan ons kaal hier rondloop. [Tussenwerpsels.]

Tydens die afgelope plaaslike verkiesing het die ANC kiesers gevra om beter gemeenskappe te bou. Is dit omdat hulle tot op datum daarin gefaal het? Hul kandidate moes ‘n plegtige eed aflê waarin hulle belowe het dat hulle hul sou toewy en sorg dat dienste waarvoor inwoners betaal, gelewer word. ‘n Versekering wat nêrens in die wêreld nodig is vir politici om te gee nie, want dit word as vanselfsprekend geag.

Hulle moes die kiesers belowe dat die infrastruktuur herstel en in stand gehou sal word. Bygesê, in 1994 het die ANC die beste infrastruktuur in Afrika geërf, en 12 jaar later gaan dit ten gronde. Paaie word onrybaar, brûe het verspoel en word nie herstel nie, geboue verval, kragnetwerke word nie in stand gehou nie, en op baie plekke is dorpe se drinkwater ongeskik vir menslike gebruik. (Translation of Afrikaans paragraphs follows.)

[Mr J P I BLANCHÉ: Chairperson, when listening to the previous speakers it sounded to me as if the ANC was going to take us to paradise, and I want to say, yes, I believe so, because eventually – the way they are carrying on – we are going to walk around here naked. [Interjections.]

During the past local elections the ANC asked voters to build better communities. Is it because to date they have failed to do so? Their candidates had to take a solemn oath in which they promised that they would commit themselves to ensuring that services paid for by residents would be delivered. An assurance no politician anywhere in the world has to give, because it is self-evident.

They had to promise voters that the infrastructure would be repaired and maintained. Not forgetting that in 1994 the ANC inherited the best infrastructure in Africa, and 12 years later it is going to rack and ruin. Roads are becoming impassable, bridges have been washed away and are not being repaired, buildings are falling into disrepair, power grids are not being maintained, and in many places the towns’ drinking water is unfit for human consumption.]

Sadly, Africa’s best-run infrastructure is falling into disrepair and we may ask: Is the ANC-led government following Zimbabwe’s lead? Recently we learned at a portfolio committee meeting that the public work maintenance backlog is steadily growing at R1 billion per annum, and now it stands at approximately R5,2 billion. Die Suid-Afrikaanse Polisiediens dreig om hul eie openbare werke-eenheid te skep, en waterwese het senior amptenare uit Kuba ingevoer om te sorg dat sy dienste tot in die jaar 2007 gelewer sal word. [The South African Police Service is threatening to create its own public works unit, and water affairs has imported senior officials from Cuba to ensure that its services will be delivered up to 2007.]

The government dare not hide behind ineffective functioning of local government in order to shift the blame for non-delivery. The same inefficiency exists in many state departments.

The Cabinet must have realised in 2004 that ANC policies failed to deliver, so they invented the Expanded Public Works Programme, hoping that it would solve the problem.

However, oversight visits throughout the country by our portfolio committee revealed that state and provincial departments are not delivering on the Expanded Public Works Programme as they should, and sustainable jobs are not being created.

In some places child labour was employed. On some assets registers, movable and immovable assets have disappeared. We cannot maintain state buildings but are building embassies worldwide at costs of over R100 000 000 per embassy. Can we justify building an embassy in Lesotho? It’s like the Italians building an embassy in Switzerland.

We need to point out where the problem lies: centralising government will not guarantee delivery at local level. Therefore, the DA recommends that public works maintenance be considered as a function that must be passed on to local government. It is the local community’s hospitals, it is their police stations, their clinics, their schools, their labour offices, etc.

Let them be responsible for maintenance by local contractors. Budget for this maintenance at provincial and government level, but empower the local and the regional officials to plan and maintain their living environment. We inherited Public Works as a national department 90 years ago, and must revisit the reason why. Must it remain centralised?

The DA recommends that we learn from the Philippines government. Our portfolio committee visited the Philippines last year. The Philippines presidential programme of infrastructure maintenance and development is backed by the World Bank, and is helping that nation eliminate poverty, modernise its service delivery, and grow its economy at local level on every one of the 600 islands.

The transfer of skills starts with infrastructure building and maintenance. It enhances local manufacture and creates skilled jobs locally. It must also be asked: Why build a new government precinct in Tshwane when we failed to maintain the buildings in our towns and cities where our departments need to deliver our services countrywide? [Time expired.] [Interjections.]

Ms C M P RAMOTSAMAI: Chairperson, hon Minister and colleagues, I stand here in support of the Budget Vote. Mr Blanché, I was wondering: When you said that we inherited the centralised Public Works, whom are you referring to with that ``we’’? We are the ones who inherited the mess you left there at Public Works. [Applause.]

It took us so many years to turn around this department as the ANC, because even you, yourself, many times have congratulated this government for doing what it has done, because with the previous government, you would never know what was actually happening when you were actually running the country.

I think we must give due where it is warranted, and not actually just discredit this government, when you know that we have gone a long way in rectifying the mess that was left here.

So when you say ``we inherited’’, we are the ones who inherited the mess here. Perhaps you should have stood here and actually thanked this government for getting you out of the mess that you created.

Madam Chair, let me take this opportunity, like my colleagues who spoke before me, and hail Minister Stella Sigcau, regardless of her health, with her officials in the department, for dedicating all their time to making sure that they deliver the best service to the people of South Africa. [Applause.] I also take this opportunity to thank our former Director- General, Mr James Maseko, and wish him well in his new endeavours.

Much has been said about the state of the department, and surely some has been quite true. For years, before the advent of our young democracy, the Department of Public Works was riddled with problems.

Undoing that has truly been an uphill battle. Year after year, the Auditor- General’s report on the department was rather negative. From 20002-2003 to date, great improvement has been highlighted by the Auditor-General. Expenditure patterns have increased, and steadily we have actually increased the spending in that department.

Ka jeno ha ho tshwane le maobane, ebile hosane ho tla ba betere ho feta ka jeno. Ka dilemo tsa ho feta Modulasetulo pele mokgahlo wa ANC o nka taolo lefatsheng lena, lefapha lena e ne ele lefapha le neng le hloka boikarabelo mabapi le mesebetse eo e abetseng yona. Ke ka hoo ho seng bobebe hore re hloekise.

Mathatha a mang aparetsweng ke lefapha lena ke botsofe ba basebetsi, aging skills. Bao ba bileng le monyetla wa ho sebetsa lefapheng lena ho tloha ka nako ya apartheid ho fihla jwale ba tsofetse, ebile ha ba ka ba fitisetsa tsebo ya bona bathong ba bang.

Ka jeno re dutse le bana ba hlokang tsebo eo bona ba nang le yona. Mme o tla fumana ho na le bannabaholo ba tsofetseng ba sebeditseng dilemo tse fetang 50 moo, empa ha ba tsebe ho fitisetsa tsebo ya bona baneng ba rona ha ba fihla lefapheng lena.

Ke ka hoo komiti ena ya rona ya Public Works ha holoho mokgahlo wa ANC e boneng hore re sebetse ha holo. Re leboha mosebetsi o entsweng ke mongadi Trevor Manuel wa dichelete, mabapi le ho ntsha dimilione tsa dichelete tse tla sebetsa … (Translation of Sesotho paragraphs follows.)

[Today is better than yesterday and tomorrow will be better than today. Some years ago, Chairperson, before the ANC governed this country, this department was irresponsible in performing its duties. That is why it is not easy to clean up the mess.

The other problem facing this department is the ageing of employees, that is the ageing of skills. Those who had the opportunity to work in this department from the apartheid era to date, are old and they did not transfer their skills to other people.

Today we have children who need the skills that they have, and you will find old men who have been working there for more than 50 years, but they do not know how to transfer their skills to our children when they get to this department. That is why our Portfolio Committee on Public Works, especially the ANC, recommended that we double our efforts. We appreciate the good work done by the Finance Minister, Mr Trevor Manuel, for allocating millions of rands that will assist …]

… regarding improving the capital investment expenditure in the colleges and to look at the infrastructure and equip the learners with skills that are so dearly needed in this country. At the beginning of the year, Minister Trevor Manuel announced that millions of rands would be spent here.

We would like those skills to include electrical, plumbing and all those necessary skills that are so dearly needed, those skills that perhaps were ignored in the past. Why should we import plumbers in this country, when we can actually train the plumbers and electricians in this country?

I think that huge infrastructure capital investment is actually going to assist us in this country. Indeed, in this department, those skills are needed so dearly. When you look at that department, you see that there are no young people who can actually carry forward some of the work, because those that are old have not actually transferred those skills. When you look today in our colleges …

… thuto ya rona e ne e se thuto e hlomphehileng haholo, haholoholo re ne re balla hore motho o hloke mosebetse. [… you see that our system of education was not a respectable one, especially because we studied in order to seek employment.]

We are sitting today with a lot of graduates who cannot get employment, because of the kind of education that has been going on, but I think with the new ventures that have been introduced by the Minister of Education in our government, we are actually sure that we are going to retain those skills, and begin to skill our children in the skills that are needed in this country.

In 2005, the Department of Public Works commissioned a study to assess the impact of the expenditure on the economy. The Bureau for Economic Research at the University of Stellenbosch concluded that gross domestic products multiplier associated with public works expenditure is about 1,3.

This implies that for every R1 000 000 increase in the department’s expenditure, the GDP calculated at cost increases by approximately R1,3 million. The study went on to state that the total number of jobs created in the economy because of the same national department’s expenditure jumped from 2 800 for the period under which the study was conducted in 2005-06.

This is not surprising, given the fact the Expanded Public Works Programme, co-ordinated by the department, has become one of the most successful models of government intervention in poverty alleviation. On its first anniversary, the EPWP has expended R3,24 billion in 3 734 projects nationwide, and created more than 220 000 jobs of which 40% were given to women and youth respectively.

At this rate, the programme is on track to meet its original target of creating more than a million jobs in 2009. To date faced with the responsibility to deliver public infrastructure as required by the Accelerated Shared and Growth Initiative for South Africa, Asgisa, the department has over the years increased its capacity to implement its mandate with vigour.

Today, it has become customary for the department to expend 100% of its budget, both for capital works and poverty alleviation programmes. I want to congratulate the department for yet again utilising its entire budget for the year under review, ensuring that the money is out there in the economy where it belongs, and that the essential infrastructure is rolled out and the poverty of our community is held in check.

The building programme of the department is extensive and consists of infrastructure necessary to uplift our people. The launch of construction projects worth more than R3 000 000 in the Free State by the Minister last week will immensely contribute to the gross geographical product of the area.

We noted with pride that the community safety centre was officially opened by the Deputy President Phumzile Mlambo-Ngcuka at Galeshewe in Kimberley last year, bringing to seven the number of such centres built by the department, contributing to the national integrated crime prevention strategy of government.

In addition, there are two other similar facilities that our department routinely hands over to its clients, including the magistrates at Botshabelo, Thembisa and Randburg, and the police stations in Mabopane, Mangaung, Namahadi and recently in Meloding in Virginia. At this rate, it is not surprising that even our law enforcement agencies has begun to record declining crime statistics.

I think I would be failing in my duty if I did not say anything about the destructiveness of Helen Zille, the new Mayor of Cape Town. I think she is getting too big for her boots too early, and they are actually going to have to deal with that.

She is actually denying this city, which is almost ready for the 2010 Soccer Cup. She must realise that …

… matlanyana ao a nang le ona, e tshwerwe ka terata e tla tsamaya ha a sa e tshware hantle. Ebile o e tshwere ka dintho tse sa tshwareheng. [Interjections.] [… the power that she has is hooked by a wire that will go away if she does not hold tight to it, and she is holding with hands that cannot hold.] This project is going to benefit big business, of which these people on my left are part, and also our small business, but because Helen Zille wants to reinvent the wheel, she spoke about delivery and at this point, she has not said anything about delivery, but about reinventing the wheel. That has been done.

She does not even realise that the 2010 Soccer World Cup does not even reside in the province. It does not reside with her. It is an international project. She must be told that, and I think her party needs to tell her that. She must realise that …

…ha a tshwara mollo o tla tjha, a shebe hantle o ntle, o tla tjha menwana ena ya hae, a tsebe hore molaonyana ona a o tshwereng, a nahanang hore o o tshwere, o o tshwere ka ketanenyana e nyane, oa tseba hore ha a hlola profinsing ena, o tshwanetse hore a shebe hore ANC le yona e na le seabo hobane ANC le yona ena le batshehetsi ba bangata profinsing ena.

Ha a sa etse jwalo o tla tjha menwananyana ena le mojwetse lona ba habo. Ke a leboha modulasetulo. (Translation of Sesotho paragraphs follows.)

[… when she touches fire she will be burnt; she must be careful. Her fingers will be burnt; she must know that the law that she is holding, that she thinks she is holding, she is holding with a very small chain. She knows that she did not win in this province; she must see to it that the ANC takes part because it also has many supporters in this province. If she does not do that, her fingers will be burnt and you, her people, should tell her. Thank you, Chairperson.]

Thank you, Madam Chair. [Applause.]

The MINISTER OF PUBLIC WORKS: Chairperson, I would not like to be in the boots of somebody who is about to burn, because you can just feel the fire. [Laughter.]

First of all I would like to thank all members for contributing to this debate. All of them contributed in a manner that was constructive, except for one person. I think that the manner in which things have changed must have something to do also with the chairman of the portfolio committee, for when you steer your vehicle in the right direction, people begin to realise their mistakes. They want to learn more about the department they are talking about.

There was a time when you could feel that there was negativity, and where there is little knowledge, there is negativity. But today, I am comfortable in the knowledge that the portfolio committee is more of a builder, it criticises in a manner that will help us build the Department of Public Works.

I said, towards the end of my speech, that South Africa is there because of public works, and that is a fact. I want to believe that maybe in the past we did not understand fully our mandate, but with the change of those in charge and those in the guard, we are beginning to understand what it is that is expected of us, and at that point I would like to congratulate all the members of staff in the Department of Public Works.

Once upon a time it was said that we had underspent, until I realised that the Department of Public Works was not underspending but was holding the other departments’ monies. Then I decided that each department must hold its own money, and we just became the people who implement. From that day onwards things began to change, so that today we are proud of the fact that we have this clean audit report.

Much as we might all lay claim because as Public Works we work as a group, with your permission, I would like Zingi Ntsaluba to please stand up if he is here. [Applause.] That is one trooper who has been unhappy these last six months, because I would say: Where are we? What have we achieved? Are we using the budget? Are we going to get another clean audit report? At times he would not want to commit, then I would say: Ndiyinkosazana yaseQawukeni [I am the princess of Qawukeni], you have to commit! [Laughter.] Then he would commit and today I am happy that his efforts together with those of the rest of the team in financial management have actually paid dividends. [Applause.]

Coming to the issue of procurement, I think that we are fast winning the battle. Though it might not be in the forefront but in some of the meetings that we hold with our would-be procurement people these days, there are things we just say as a department that we cannot stand and people can either take it or leave it. If people are prepared to work and make their own companies thrive, then they have to take it.

Coming to the roll-out of all skills which was required when it comes to public works, there were just no skills because necessary training was not called for, but these days when we approach a company to give it work, we say it must also give us a relevant statement of how many people have been skilled, through learnerships and other means.

Akusafani nayizolo, akusathambanga. Akusadliwa umngqusho okanye amasi ayizolo; sisebenzisa awanamhlanje. [It is no longer the same as yesterday; it is no longer an easy road. We are no longer eating samp or yesterday’s dairy products. We use today’s dairy products.]

With regard to the issue of land, we have tried to give up all the land that we do not require to other government services. In some of the claims, for instance those which were submitted to the Department of Land Affairs, some of that land has come from public works, but it would be stupid at this point in time with a government that is progressive, with a country that is moving forward, to say: Let us get rid of all the land, because at the end of the day we will find ourselves having to buy back that land and it would be costly for government, so we try to strike a balancing act.

I am sorry that somebody said South Africa is following the example of Zimbabwe. I will just leave it at that because I think that we do not want people to be comparing one country to another. All that we want is to say what good can other people learn from the situation in which we are?

I just want to inform the lady who thinks that 2010 is one big joke. I want to say that public works is more than ready to start on the stadia. We are ready and we are ready to move. [Applause.] Having been given that chance we have to prove ourselves as being excellent.

On the issue of maintenance by black economic empowerment, hayi kaloku ndincedeni apho. [please, hold on.] There is a tendency that is coming out in South Africa that if a person is a member of a black economic empowerment company, that person cannot make legitimate mistakes. If he does, it will be said that it is because that person is underdeveloped. I have worked with bigger companies to date and at times you find that having misinterpreted some of the clauses within the contract, they make mistakes. So, please hon members, be tolerant when it comes to BEE companies. You can even come and inform us and we will see whether we can put things right, because we build offices as public works but we also build the skills within South Africa. You cannot build and destroy. What you want to do is to make sure that there is progress in whatever it is that you are trying to do.

Then we talk about the proportions. Some say it should be 30% for women or that percentage for women. All I want to say is that women must be given an opportunity in their numbers and with time we will begin to reach some of the percentages we are talking about. There is nothing as bad as a child who takes for granted that one day he is going to inherit wealth, because that child will not prepare for the future. But at the same time it is good to have a goal, and so when you talk of women and the percentages, we are saying: This is the goal we must work for, but you must really work for it. The same thing applies to our youth.

I do not know, I come from a part of the country where the migrant labour system did kill ambition some 10 or 15 years back, but what is emerging now is a fire that shows that people are proud to be who they are. They are proud of what they can contribute to the bigger picture of South Africa. So, we are encouraging our women and our youth to spearhead development, but at the same time we are not telling these men to be layabouts, people who just sit back and watch events go by. That would be terrible for South Africa.

I do not know, I think I have covered all the points that you raised and I really want you to help us, the people who are part of the programme where there is advocacy of the campaign against fronting, because no matter how much you want to escape from it, it is there. Then finally, I want to say to one of the speakers who spoke right at the beginning of the DA: Don’t hand out labels.

That speaker accused me here, hiding behind the fact that there is immunity in the House. Go outside and say the same thing to me, and you will see who I really am.

Debate concluded.

The House adjourned at 19:53 ____

            ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS

TABLINGS

National Assembly

1. The Speaker The President of the Republic submitted the following letter dated 17 March 2006 to the Speaker of the National Assembly informing Members of the Assembly of the employment of the South African National Defence Force in the Union of Comores:

EMPLOYMENT OF THE SOUTH AFRICAN NATIONAL DEFENCE FORCE IN COMPLIANCE
WITH THE INTERNATIONAL OBLIGATIONS OF THE REPUBLIC OF SOUTH AFRICA
TOWARDS THE UNION


This serves to inform the National Assembly that I authorised the
employment of the South African National Defence Force (SANDF) in
fulfillment of the international obligations of the Republic of South
Africa towards the African Union, through participation in the African
Union Mission in the Union of Comores, to ensure a secure environment
conducive to credible, free and fair elections.


This employment was authorised in accordance with the provisions of
section 201(2)(a) of the Constitution of the Republic of South Africa,
1996, read with section 93 of the Defence Act, 2002 (Act No 42 of
2002).


A total of 371 members will be deployed to the Union of Comores as part
of the African Union Mission to the Union of Comores for a period of
three (3) months.


The expected costs for the deployment of personnel for the period to
the Mission are as follows:


        Personnel and administrative costs     R16, 207, 375
        Logistic costs                   R75, 202, 038
        Total                                  R91, 409, 413


The Department of Defence is responsible for the costs of this
deployment and is able to accommodate it in its 2006/2007 peace support
operations allocation.
I will communicate this report to members of the National Assembly and
request that you bring its contents to the attention of members of the
National Assembly.

Regards


signed
PRESIDENT

COMMITTEE REPORTS

National Assembly

1. Report of the Portfolio Committee on Finance on the Division of Revenue Bill [B 3B - 2006] (National Assembly - sec 76), dated 29 March 2006:

   The Portfolio Committee on Finance, having considered the Division of Revenue Bill [B 3B - 2006] (National Assembly - sec 76), amended by the National Council of Provinces and referred to the Committee, reports that it has agreed to the Bill.

Report to be considered.

1. Report of the Portfolio Committee on Sport and Recreation on the Oversight Visit to the Western Cape, dated 15 March 2006:

2. Introduction The Portfolio Committee on Sport and Recreation having conducted an oversight visit to the Western Cape, reports as follows:

   The Portfolio Committee on Sport and Recreation undertook an oversight visit to the Western Cape as part of the oversight function. The visit was from 12 to 15 October 2005. The delegation visited Swartklip Indoor Facility; Khayelitsha; Paarl; Provincial Legislature; Vredenburg; Cederberg; Oudtshoorn and Beaufort West. The multiparty delegation that constituted the visit to the Western Cape was:

   Mr B M Komphela, Chairperson (ANC); Mr M M Dikgacwi (ANC); Ms D M Morobi (ANC); Mr E Mtshali (ANC); Mr. L L R Reid (ANC); Mr E Saloojee (ANC); N Mbuqe (Committee Secretary) and C Sheldon (Committee Assistant)

3. Terms of reference:

   The aim of the visit was to:

 1. Visit the key nodal areas where community mass participation
    programmes have been launched by Sport and Recreation South Africa
    [SRSA] and development plans for the Indigenous Games and Mass
    Participation Programmes (MPP) for the disabled and women


 2. Determine the understanding and the preparedness of the province on
    School Sport after the signing of Memorandum of Understanding [MOU]
    between Sport and Recreation South Africa and Department of
    Education Ministers.
 3. Meet with the local sport councils and management committees of the
    provincial academies on their admission/selection criteria and
    programmes, linkages to the national academy and sources of funding
    in terms of corporate entities. Meet with sport councils to
    establish their involvement in national events such as the 2010
    World Cup and also the plans they have for rural areas because
    sport councils are a direct responsibility of the national
    department and to find out how they are resourced by the
    department.


 4. Visit areas where Building for Sport and Recreation programme
    (BSRP) is implemented, evaluation on the efficacy of the programme
    with regards to mass community participation and determining the
    state of readiness of local structures to become implementing
    agents for the programme.



 5. The impact of MIG in building of sport facilities.



  Mr Henry Paulse from the provincial Department of Cultural Affairs and
  Sport accompanied the delegation during the visit.

1. Findings

   3.1. Swartklip Multipurpose Indoor

    The facility is being built between Khayelitsha and Mitchells
    Plain for integration and to feed the two communities. R1m was
    paid for fencing and R1m for building the first phase. It will
    have soccer, golf, netball and basketball fields. The area that
    the facility is built on used to be a dumping area but is not
    going to be a danger to people. The total amount given by BSRP
    is R2m and the City Council has put up R14m.
   
   
    This facility is preparing for SA Games that will take place in
    2007. The first phase is already finished and they are in the
    process of building indoor centre. Parking is one of the
    challenges if looking at hosting SA Games in Cape Town. There
    are 47 employees as from 28 September 2005, 10 from Khayelitsha;
    5 women and one (1) disabled. A request was that for the first
    phase an amount of R22m must be secured and R4m for the second
    phase. The sport council is very much involved in the process.
   

   3.2. Meeting with Khayelitsha Sport Councils

    Mr. Mfundo Bobo, the Chairperson of the sport council, made
    presentation on concerns and achievements from Khayelitsha sport
    as follows:
        • The council was formed in 1992 with the aim of coordinating
          sport in the area. Twelve members cover the whole sport in
          general.
        • He commended the Municipal Infrastructure Grant [MIG] pilot
          project of the sport ground initiated by Shoprite, the
          municipality and government. The project has a buy-in of
          the community and built next to the library and schools.
        • Khayelitsha is a vast area with more challenges and share
          three basic facilities for 350 000 people. One in Site C is
          depleted with no stand but with change rooms, one good
          track field in Mandela Park, change rooms and no
          electricity.
        • There are more clubs than facilities. There are Lingelethu
          Soccer; Khanyiso and Mzamo Associations with lot of clubs
          than the fields can handle.
        • Indoor facilities like halls experience problems in that
          they are used for funerals and other social events like
          church services. Oliver Tambo Sport Indoor is problematic,
          sport councils are forced out of it due to human relations
          problems but there was no alternative given after being
          forced out and don’t have place to operate from. This hall
          is most accessible to all.
        • Too much talent but lack nurturing.
        • People go out of Khayelitsha to play but no return matches.
        • Own funds are used for transportation but without refund.
        • Khayelitsha merged with Mitchells Plain after the
          President’s announcement of Urban Renewal to form one
          committee. Khayelitsha is supposed to have 8 more sport
          councils to enable them to identify new talent. New fields
          are developed by the pilot project.
        • Challenge is that unstructured clubs playing without
          financial potential to register with other clubs but taken
          care of by Mass Participation Programme (MPP).
        • Volleyball is only played in Oliver Tambo, volleyball and
          wheelchair players play at the same venue, which is
          dangerous.
        • The codes requested schools for the uses of venues but
          School Governing Bodies (SGB) refuse due to lack of
          discipline from players. A problem occurs when the team
          loses a game they vent their anger at school windows or
          vandalise the school.
   

   3.2.1 Concerns from the delegation

        • What is the relationship with the Department of Sport and
          Cultural Affairs in the province?
        • Which codes are playing and who is responsible for
          maintaining facilities?
        • Is there any swimming pool, tennis court or gymnastics
          played?
        • In Mass Participation Programme are there any older persons
          participating?
        • What is the term of office for sport councils?
        • What games for elderly? Any programmes?
   

   3.2.2 Responses

        • The relationship is not very clear. The MEC told the sport
          councils to approach the Department of Sport and Recreation
          (DSR) in the province for money to pay for children to play
          but connection is not clear.
        • Four (4) codes are played in the same facility at the same
          time, which causes conflict. Facilities are limiting
          talents. Golf range is out of Khayelitsha area and used by
          nearby people. Amy Biehl Foundation assisted in launching
          golf range in September but Khayelitsha is not
          accommodated. For training, clubs go to Mitchells Plain
          during the week and pay R10 an hour for practising.
        • Elderly people participate in MPP for summer and winter
          games funded by Department of Sport and Recreation. The big
          challenge is lack of indoor facilities.
        • The term of office is three years. An institutional
          framework has been launched for areas to be regionalised
          but is more connected to Mitchells Plain in the new
          institutional framework which will start on 31 December to
          form one. Sport councils report to business and political
          forum on Sundays.
        • The programmes for elders are fun walks, gymnastics and
          indigenous games.
   

   3.3. Khayelitsha Stadium

        • The facility is overused without drainage system and during
          the rainy season the water is contained in the field and
          causing more damage.
        • There is no grass anymore due to over usage with temporary
          stands.
        • Rugby field is in better condition.
   

   3.4. Site C Stadium

        • Two fields without grass.
        • Currently dangerous and very rough
   

   3.5. Daljosafat Athletics Stadium

        • Double storey house was built as part of the 2003 World Cup
          legacy built in the centre of the area.
        • Well resourced with tartan track and green grass.
        • Need R120 000 for equipment for athletics in order for them
          to be recognised worldwide.
        • Facility is well cared for according to Richard Stander,
          the CEO of Boland athletics.
        • There are change rooms, first aid room and an office
   

   3.6 Meeting with Boland sport councils

    Most of the sport councils were not present due to late
    notification by the department. But they gave few comments and
    requested another meeting with the Committee. The following
    concerns were raised:
        • Karate, which has two bodies, one illegal and served for
          personal reasons.
        • The municipality representative informed the delegation
          that they have managed to have Drakenstein Sport Forum
          sport needs in the IDP and also have sport committee with
          councillors focusing on sport issues.
        • Policy is drafted to guide municipality to drive sport with
          R1, 56m allocated to sport facilities and R80 000 for rural
          sport development.
        • The council has amalgamated with other municipalities to
          share in a meaningful way and the remote areas will get
          share from R1, 5m
        • R500 000 is distributed to farm schools
        • SA rugby veteran raised a concern of non representation of
          Black people in Boland rugby
        • Athletics had their last board meeting on 8 February 2005.
          They also proposed another meeting with the delegation.
        • Boland sport council Board member also requested another
          meeting to clear out issues
        • It is difficult to get Black people in cricket due to
          culture that need to be addressed
        • Developing and transforming sport is a need/concern and
          people volunteering should be addressed
        • Started reimbursement implementation for any player
          poached.  People that are busy pushing transformation must
          be reimbursed for their effort and put the money where
          development is.
   

   3.6.1 CEO Boland cricket

        • Budget is cut by 27%
        • There is good relationship with local government
        • There are two legacy projects left by Cricket World Cup
          2003
        • Involved with activities and assist with coaching clinics
          at levels 1 and 2
        • The delegation must clear statement by Gerald Majola that
          more is given to amateur cricket.
   

   3.6.2 Boland rugby union

    The union has
   • 224 clubs with 10 000 players
   • Received R350 000 from ABSA
   • No good cooperation from local government
   • Established a committee to look at development of Black rugby at schools
   

   3.6.3 Boland schools

        • 600 primary schools are affiliated to USSASA
        • Up to last year (2004) paid R1 000 per school and farm
          schools pay R1 per child
        • Good relationship with local government
        • Disbanding of USSASA should be communicated clearly to
          teachers because they are very confused.
        • No one is looking at sport where schools are playing but
          when going on competitions outside national government pays
   

   3.6.4 Karate

        • The committee was disbanded by government for fraudulent
          and illegal issues but those people are still in power
        • Need to investigate the meeting held in South African
          Sports Commission in February as illegal
   

   3.6.5 Paarl sport forum

        • Is 10 years old and has good relationship with local
          government
        • Has 25 sport codes including Mbekweni
        • Received R1, 5m for funding.
        • Will be honouring all who received colours on 28 November
          2005
   

3.7 Meeting with the MEC and provincial officials

  Mr W Jacobs, MEC for Cultural Affairs and Sport in the Western Cape
  gave a broad overview on sport issues in the province. He mentioned
  the challenge of infrastructure and welcomed advice from the
  delegation. He noted that infrastructure is a key and becomes a tool
  for development. He cited an example of boxing practice in a shack
  paying R500 for practice and R1 500 for tournaments. He sought advice
  on role played by infrastructure in developing talent.

  Head Of Department (HOD)

  Adv R Solomons , HOD, gave a detailed statement in response to the MEC
  and the objectives set out by the delegation on the visit. He
  mentioned that the role played by 187 School Stepping Stones Project
  [SSS] people in introducing school sport in schools. There are two
  volunteers deployed per school. They receive a stipend.


  He further mentioned that there is transforming monitoring committee
  dealing with investigations on sport. The department has an idea of
  moving the sport academy to a central point where sports school for
  all parts of the province would be established and learners will be
  looked at. If the project is successful it will be extended to other
  provinces. A mechanism for monitoring and governing funds given to
  federations is being proposed. Due to focus of local authorities on
  housing, sanitation etc and neglecting sport has made the department
  to look at forming agreements with local authorities. Budget was well
  covered and Mr Kambule also gave detailed information on programme 4.


  Another big concern was use of funds to buy rugby players instead of
  assisting amateur clubs.


  Mr Komphela commented that the Committee is looking at introducing
  legislation in terms of governing sport that is one of lessons learnt
  during France study tour. He emphasised that spatial planning process
  is closing the gap between the communities in terms of integration and
  unity. During the deliberation on the legislation all provinces will
  be invited for their inputs. He requested the department officials to
  be closer to USSASA because people still recognise the structure.

3.8. Meeting in Vredenburg with sport councils and community

  The Chairperson gave appreciation for the presence of Mayoress J
  Stoffels. He commended the attendance of sport councils and the spread
  of representation from their different codes. Mr Komphela gave an
  indication in his introduction of the need for candour and honesty in
  the discussions which would enable the delegation to make an informed
  decision to Parliament about sport, facilities, funds, programmes etc.
  After detailed objectives were given every code had an opportunity to
  give their concerns, achievements and challenges.


  The Mayoress mentioned the lack of sport facilities that results in
  youth spending time in liquor consumption and other bad things.  She
  requested funds for jukskei hence the leader of the delegation
  emphasised on prioritisation of popular sport in the area. Although
  jukskei is doing well, tennis and bowls have no facilities at all. She
  then emphasised the urgency of building facilities. The councillor
  from Saldanha mentioned that sport is third on the priority list of
  IDPs.


  The sports council acknowledged the impact and relationship between
  them and the municipality and also the department of sport. Mr
  Komphela thoroughly explained the content of the Memorandum of
  Understanding between the Department of Education and Sport and
  Recreation and the conceptual spirit of the agreement.

  Members of the delegation also commented on issues like the principle
  of having school sport; responsibility of the community for usage and
  protection of school facilities.


  The Chairperson of sports council urged the delegation for assistance
  and logistical support for office space. There are 270 administrators
  with 1 200 soccer players. Their plea also was to have at least one
  practice game in the area during the Soccer World Cup (2010) although
  they don’t have a facility of the standard required by FIFA.


  A plan is being developed for sport facilities for the region to avoid
  duplication. The council is very supportive, but there is a problem
  around accountability from the soccer fraternity leadership. There is
  also no contingency plan for migrating officials for conducive long-
  term implementation.


  The chairperson of St Helena sport council noted that a letter was
  written to the former MEC on the following issues:
• Heroes in the area that need to be acknowledged e.g. Enrico Januarie
  etc
• A great need for tourism so that more people could visit the area
• 18 soccer clubs utilising one field causing the fields to deplete
•  There is racial tension caused by lack of facilities
• Introduction of sport to unite people
• Accountability of municipality for 6 different towns

  The mayoress was asked to finalise the sport master plan and the
  community need to have a multipurpose facility to play different sport
  codes but must be well planned in terms of sharing, i e structured
  programme.

3.9 Meeting in the Cederberg municipality

  The area has five towns and not all of them have basic facilities.
  Smaller towns have problems with basic facilities and clubhouses.
  Money has been received from Lottery for upgrading facilities. Mr
  Paulse explained that most clubs belong to Boland Rugby and there was
  a shortfall of R400 000 that will be transferred end of October.
  Sports awards will be awarded for the first time since the recent
  establishment of sport forum. He noted that four regional offices have
  been established with experienced people for networking. The province
  is focussing at elite sport hence Western Cape is identified as Mecca
  of sport.


  Mr Andre Enslin from the regional office informed the delegation that
  meetings have been set up in preparation for SA Games. The area once
  held West Coast Indigenous Games in Clanwilliam. Administrators are
  trained in different pools and also in sport clinics and programmes
  for the aged.


  The delegation met with the director of economic development, Ms
  Matilda Smith of Cederberg. She gave a brief background of the
  municipality but noted that they recovered from financial crisis as
  the municipality with the assistance of the department. She mentioned
  the poor community that is not able to pay services, which affects
  participation in sport. Sport in the area is seen as poverty
  alleviation strategy to build people’s self-esteem and can play an
  integrating role to introduction of Mass Participation. She noted that
  cricket is dying slowly but soccer clinics need equipment and kit.


  There is lack of transformation whereas good talent is not developed.
  The sport council member mentioned conflict caused by use of one
  ground between rugby and soccer. For gym purposes the payment is R50
  and R100 for playing a match. This paralyses sport-loving people
  because most players don’t have money, and that leads them to
  drinking. The delegation was shown a field that people used that is
  not in a good condition. The field is flat and big, used for soccer
  and rugby, and with a concrete cricket pitch for practising.

3.10 Meeting with the provincial standing committee on cultural affairs and sport

  The delegation had a short meeting with the Standing Committee of the
  province. Mr Komphela gave a detailed briefing on political state of
  affairs in sport. He thoroughly explained the current position of
  school sport giving details of what the MOU stands to achieve. He
  touched on the impact of MIG referring to what BSRP has done
  previously. He further mentioned the country’s concern regarding
  leased facilities.


  Adv Solomons also added that the provincial committee should call more
  people to account on certain issues, and  not only the department,
  and encouraged more interaction between the provincial and national
  committee. He encouraged the Committee to invite people to share
  information on racism and be able to discuss intergovernmental issues
  and governance of federations. The lack of facilities and leased ones
  need a vigorous interaction between all stakeholders involved.


  The provincial Chairperson, Ms Witbooi, appreciated the issues
  discussed in a short time and committed herself on behalf of the
  Committee to make time for more interaction with the national
  committee to learn more. She even commented that she has noticed the
  total deterioration of school grounds. She further voiced concern that
  most teachers who had experience in physical education have left
  schools and concerned about the taking over of the responsibility to
  do physical education in schools.

3.11. Meeting in Oudtshoorn with sport councils and departmental officials

  The Chairperson of the sport council raised the following concerns:

     - Task – to promote and govern sport depends on the agreement to
       manage sport facility
     -  No support from local authority
     - Lack of support from the council
     - In terms of human resources, there are experienced members but
       they are part of other organisations in the community, which
       makes it difficult for them to do their job at sport councils
       due to other tasks.
     - Need to form partnership with federations to build people and
       develop women in the community

  Mr Paulse clarified that agreement was made prior the handing over of
  the facility between municipality and Department of Sport.


  3.11.1      Bongolethu sport council

       The sport council raised the following concerns:

           - Oudtshoorn sport council is sidelining them and they are
             not affiliated to any federation
           - Some time ago it was only the Defence Force that was
             active, had resources and tried to revive sport
           - Meetings were convened especially for soccer and females
             were interested and started netball without netball fields.
             They depend on school fields for practise and matches
           - There are seven soccer clubs but only have two playing
             fields
           - No cricket facilities but there is a lot of interest
             amongst the people
           - Bridgeton has two cricket fields; two rugby fields; tennis
             court, one soccer and two netball fields
           - In town there is one rugby field; two cricket fields; one
             athletic track of international standard; one indoor venue
             used for boxing training and Olympic size swimming pool.


    Mr Dirk van der Westhuizen, the regional head of sport, informed
    the delegation that after 1994 only soccer was affiliated to a
    federation and stadium was built without being vandalised. Everyone
    is free to book a facility from the municipality but the federation
    who wants to use it must pay.

  View of facilities

  The delegation viewed some facilities and has the following findings:
  3.11.2       Bongolethu Sport Field

           - The field is well fenced with face bricks; flood lights;
             soccer poles and toilets
           - Was built without consulting the community and ended up
             totally vandalised
           - Received R175 000 to put in the pitch and lights in 1994
             but people just jump over to the other side destroying the
             grass and fence
           - A caretaker house is built but the caretaker is threatened
             and must open when the community request him to.
           - The department is looking at putting high wall to avoid the
             crossing over.


  3.11.3  Dysseldorp Sport Ground

           - An initiative of partnership between government, community,
             sport trust and municipality resulted in the erection of
             the ground
           - There was an application to BSRP for R200 000 to stabilise
             the ground in stages
           - R2, 5m was spent to stabilise and rebuilt it, with
             conference rooms and good field flood lights
           -  There is a pool, cricket pitch and nets and sight screens
             provided by UCB


  3.11.4  New Generation Multipurpose Sport Facility

     - Was funded by SCORE, European Union and local authority
     - Have basketball, netball, mini soccer and volleyball courts
     - Storeroom is available to keep equipment and also hold meetings.

  3.11.5. Klaarstroom Facility


     - Was built by BSRP for R350 000

  3.11.6  Rustdene Facility

           - Is well fenced by bricks and covered grandstand with
             underneath change rooms and a Presidential Suite.
           - The facility was built in 2002/03 with R3m from SEMA with
             ablution block incorporated in the plan and underground
             irrigation.
           - 2003/04 received funds from BSRP of R350 000 and again in
             the same financial year received funds from Lottery of
             R2,4m but still not enough
           - Soccer field is well maintained with green grass
           - The only challenge was content of the cement and PPC was
             brought in to examine the condition to prevent Ellis Park
             incident but PPC confirmed safety after compression
             testing. The demolition caused a delay but the consultant
             was eventually satisfied. The resolution was that should
             anything happen to the structure then the consultant will
             be held responsible.

1. Beaufort West meeting

   The comment made in the meeting was that MIG is not sport friendly or small municipality friendly. There are basic facilities because of BSRP and there was proposal to continue with BSRP.

   The Mayor also confirmed that sport is very low in the priorities of IDPs. Sport has been a problem to prioritise and the President emphasised that plight of the community should be addressed. The area was very pleased with the introduction of BSRP. Since the MIG has downscaled the situation it is clearly showing that it won’t be possible to achieve all the goals or build the proposed facilities.

   Municipality can make commitment to maintain facilities if the sport department can assist in reintroducing BSRP. A request was made that the national Minister of Sport and Recreation and the Portfolio Committee be present during the opening of the stadium in Beaufort West on 10 December. Furthermore, the Mayor proposed that a big game be played on a Saturday of the opening to have big attendance.

   4.1. Questions from the delegation

 1. What level is the budget for sport in municipality? How much is it?
 2. How is the relationship with school sport in terms of facilities?
 3. What challenges do you experience with multipurpose centres?

  4.1.1  Response

          1. R1m besides CMIP of R600 000. Maintenance operational of
             10% is spent from the budget. There is no money raised from
             community but the municipality is in the process of
             reviewing IDPs and will look at reprioritising them but
             sport is presently number five (5) and competes with other
             social activities.
          2. The understanding about school sport was not clear prior
             the Memorandum of Understanding but now schools are
             requested to do their development plans and their needs so
             that they can be part of the IDPs. The Council takes
             resolution on any assistance to be given to schools with
             the 75% subsidy from the municipality.
          3. Phase Two will address that but will need more funds.
             Currently the office is accommodating Home Affairs
             activities.

1. Conclusions

   • Lack of indoor facilities. Those existing are used for social activities like church services booked for a month long. • Information about the Memorandum of Understanding on School Sport is not filtered through to the province. There is still lot of confusion on who will take over coordination of school sport. • Facilities built by Building for Sport and Recreation Programme (BSRP) have made a big difference but the impact of Municipal Infrastructure Grant (MIG) is a big challenge hence the fund is not ringfenced for sport issues so it is used for priorities identified in the Integrated Development Plans (IDPs). • Sport councils are not part of discussion during local or municipality IDP process that results in sport not being prioritised. • BSRP has built about 144 basic facilities in the country but since the transfer of funds to MIG only 4 have been built. • Small municipalities that have no revenue base do not afford to maintain facilities resulting in depletion or vandalism, e.g. heating of swimming pool. • Khayelitsha has a lot of talent, interest and enthusiasm but a lack of facilities and transport assistance to the township paralyses the talent. This causes the talented youth to use drugs and alcohol. • Ambitions of communities to host either training or practise games for FIFA World Cup 2010 despite the standard of their facilities.

2. Recommendations

   The Committee recommends that:

   • SRSA need to give clear explanation about the Memorandum of Understanding between Department and Sport and Recreation South Africa on School Sport. • Sport councils should be encouraged to attend and participate in IDPs so that they give priority to sport facilities and other issues and budget for sport should be increased even at local municipalities. • SRSA must provide the list of facilities remaining from those who were supposed to be built by BSRP. • 5% from Municipal Infrastructure Grant should be dedicated for maintenance of facilities.

Report to be considered.