WEDNESDAY, 18 OCTOBER 2006

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                PROCEEDINGS OF THE NATIONAL ASSEMBLY

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The House met at 15:04.

Acting Speaker Mr G Q M Doidge took the Chair and requested members to observe a moment of silence for prayers or meditation.

ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS – see col 000.

                      QUESTIONS FOR ORAL REPLY

                              ECONOMICS
                              Cluster 3

MINISTERS:

  Passenger railway stations under SA Rail Commuter Corporation Ltd
                            jurisdiction

1. Mr V C Gore (ID) asked the Minister of Transport: (1) How many passenger railway stations fall under the jurisdiction of the SA Rail Commuter Corporation Ltd in (a) metro and (b) non- metro areas;

   (2) whether any of these passenger railway stations comply with the National Building Regulations and Building Standards Act, Act 49 of 1995, in terms of access to people with disabilities; if not, what policies have been put in place to address this shortcoming; if so, how many?

                N676E
   

The MINISTER OF TRANSPORT: Chairperson, the SA Rail Commuter Corporation has 319 stations that fall under its jurisdiction. These stations fall within the metropolitan areas as the SARCC currently operates in the six major metropolitan areas of Cape Town, Greater Johannesburg, Tshwane, eThekwini, Buffalo City and the Nelson Mandela metropolitan area. The answer to part (b) is: None.

Regarding the second part of the question, it is acknowledged that many of the above-mentioned stations currently do not adequately address the issue of access for people with disabilities, as many of these stations were constructed prior to relevant legislation and regulations pertaining to people with disabilities from an accessibility perspective. However, the SARCC is addressing these problems. Also, policy relating to the accommodation of special-needs passengers on the rail system has been developed addressing the issues contained in this Act, such as in the Constitution, and the Promotion of Equality and Prevention of Unfair Discrimination Act. The term “special-needs passengers” also includes the elderly and the young, just to name a few, in addition to people with disabilities.

This policy that I’ve just highlighted takes a total service concept approach and takes into account and responds to areas such as infrastructure and facilities, that is stations, passenger information and bridging the gap between the platform and rolling stock.

Furthermore, the policy also acknowledges the need to ensure that all personnel, rail police and the SA Police Service are appropriately trained in disability awareness to assist all special- needs passengers as well as ensuring the availability of all these elements. For example, recently, a pilot project was implemented in Cape Town to upgrade two key stations, making them more special-needs passenger friendly. The two stations were Mandalay and Lentegeur stations. The lessons learned from this project and the effectiveness of the measures introduced will be incorporated into the designed guidelines and standards.

Another project, the new Khayelitsha railway line extension, with two new stations, including the associated pedestrian bridges, has been designed using universal design principles and is currently being built to be fully inclusive and ensure barrier-free travel for passengers. Thank you. There is a lot of noise, Chair, in this House.

The ACTING SPEAKER (Mr G Q M Doidge): Especially on my left, hon Minister.

Mr V C GORE: Thank you, hon Chair, and thank you, hon Minister, for the informative information and for your acknowledgement that not enough is being done in this regard. Hon Minister, there can be no disagreement or argument about the fact that people with disabilities remain one of our largest marginalised sectors of our community today. If we wish to build a society – a completely inclusive society - we need to ensure that people with disabilities and their families are able to travel from their homes to their places of work, to places of worship, to their places of recreation and to their places of education and learning.

If we are unable to achieve this, we have failed this sector of our community. This question, hon Minister, has highlighted a very important component of the public transport system and how people with disabilities continue to be marginalised from mainstream society.

Hon Minister, in response to your answer, I’d like to ask whether there would be a commitment from yourself and from your department that, in the future, no new railway stations will be built that do not provide adequate accommodation for people with disabilities, as well as that any old railway stations that are refurbished will be done in such a way that they provide for reasonable accommodation for people with disabilities? I thank you.

The MINISTER OF TRANSPORT: Hon Chairperson, I want to assure the hon member that we’ll ensure that we abide by the law. Also, we believe that it is correct and right to correct what has happened previously by not providing adequately for people living with disabilities.

This coming weekend, on Sunday, we will be having a public transport indaba in Soweto, and we have invited your association so that we can incorporate all the elements and things that are needed in order to ensure that when we implement our public transport plan, we take into account the issues that you’ve just addressed.

Ms S RAJBALLY: Thank you, Chairperson, Thank you, hon Minister, for your answer. I think there has been great progress in whatever initiatives you have been tackling. Nevertheless, hon Minister, may I ask you whether, while acknowledging the shortfall, any interim initiatives to assist disabled persons have been initiated?

The MINISTER OF TRANSPORT: Chairperson, I have already indicated in my reply that, for example here in Cape Town, in upgrading the old stations of Mandalay and Lentegeur, we’ve made sure that we provide the necessary infrastructure that will make them accessible and responsive to people living with disabilities. As we progress with other upgrades, we’ll make sure that we do the same.

But, as I’ve indicated, with all new infrastructure in the form of railway stations that are going to be built, we’ll accommodate all the issues so that passengers who are disabled are able to travel without any hindrance.

Mr M M SWATHE: Thank you, Chairperson. Minister, during one of President Mbeki’s state of the nation addresses some years ago, he referred to the Expanded Public Works Programme, which would ensure accessibility to all public facilities by disabled people as part of job creation programmes.

I have been made aware that the ramp into the Marks Building took nearly four years to be built. Does this department or the Office of the President have a special budget for providing access for the disabled? If so, what is the amount, and how has it been adequately spent over the past financial years? Could some of these funds be transferred to the SARCC to speed up the process? Thank you very much.

The ACTING SPEAKER (Mr G Q M Doidge): Minister, do you want to attempt to provide some information on that? [Laughter.]

The MINISTER OF TRANSPORT: I was last the Minister of Public Works from 1994 to 1999. There is a brand new Minister of Public Works called Thoko Didiza, and also there is a Minister called Dr Essop Pahad, who is the Minister in the Presidency and to whom this question should be directed. [Interjections.]

The ACTING SPEAKER (Mr G Q M Doidge): Thank you, hon Minister. Order!

Mr J P CRONIN: Thank you, Chairperson. Thanks to the Minister for his replies, including the last response to a question that didn’t seem to relate to the actual question. Also, thanks to the hon Gore for raising this question, because I think it actually is a very pertinent issue.

The portfolio committee took an oversight trip to have a look at the developments around the Gautrain. One of the things that most interested us was how the Gautrain was going to interface with existing Metrorail infrastructure. So we had a look at Park Station, which is going to be one of the major stations that will interface with the Gautrain.

As it happened, we had a disabled member with us on the oversight trip. And I must say just negotiating Park Station and travelling to where the new Gautrain connection would be proved to be a huge mission for all of us, but particularly for the disabled member. In following up, I would like to ask the Minister whether he agrees that the Gautrain project also puts additional responsibilities on the SARCC to ensure that their existing stations are upgraded in the direction that the hon Gore has asked.

The MINISTER OF TRANSPORT: Yes, I agree with the hon Cronin that we are dealing with a huge backlog, but I’m making an undertaking that whenever we do the upgrades, we’ll endeavour, to the best of our ability, to follow the letter of the law by upgrading stations so that people with disabilities can access them, even Park Station.

Regarding the Gautrain, it will be incorporated so that we do not come back again, because the costs of upgrading specifically for the disabled would be more costly than the cost upfront, at the beginning.

I must indicate that I’m also personally very sensitive to this issue. I was conscientised long ago by an architect by the name of Phillip Thompson who assisted a great deal in improving the accessibility of especially public buildings for people living with disabilities.

The ACTING SPEAKER (Mr G Q M Doidge): Thank you, hon Minister. Question 266, which has been asked by the hon E N N Ngcobo, has been withdrawn.

Enterprise funding, monitoring mechanisms and communications strategy

1. Ms M M Mdlalose (Nadeco) asked the Minister of Trade and Industry:

   (1) Whether his department records how many women per province received funding for start-up enterprises by his department; if so, (a)(i) how many of these enterprises have failed and (ii) what were the reasons for their failure, (b) how many of these enterprises are successful, (c) what mentoring mechanisms are currently in place to ensure the success of start-up enterprises, (d) what criteria are used to select mentors and (e) how regularly do mentoring interactions take place;

   (2) whether his department has put any mentoring mechanisms in place to monitor implementation agencies such as Khula, the Nations Trust and others to ensure that loans that were granted yield successful businesses; if not, why not; if so, what are the relevant details;

   (3) whether his department has put a communications strategy in place to (a) encourage entrepreneurship amongst the youth, especially graduates with degrees that do not necessarily guarantee them employment and (b) inform the poor and unemployed about empowerment programmes offered by his department; if not, why not; if so, what are the relevant details? N1431E

The DEPUTY MINISTER OF TRADE AND INDUSTRY (Dr R H Davies): Chairperson, with respect to parts 1 and 2 of the question, information on services provided to women entrepreneurs is recorded by some agencies. For example, women currently make up around 35% of the Khula indemnity portfolio client base, and Khula actively encourages women entrepreneurs to apply for start- up finance.

With respect to failures, the department does not keep records on failed start-up businesses. It does, however, operate from the established assumption that there is a high failure rate amongst small businesses the world over, especially amongst start-up enterprises.

High failure rates amongst South African small business enterprises persist in spite of support services such as the Khula mentorship. There is a multiplicity of reasons for these failures. For example, according to banks participating in the Khula indemnity scheme, many start-ups fail due to poor financial management.

The high failure rate amongst start-ups is also generally due to the lack of skills in business administration. Most small business people in South Africa are survivalists and lack the necessary entrepreneurial training. This is especially true of women entrepreneurs. A number of failures are also due to cash-flow sensitivity of SMMEs in general, and a tendency amongst some to mix up personal and business financial management.

With respect to successful enterprises, SMMEs can be regarded as successful if they survive beyond three years and meet their loan obligations during that time. While the failure of start-ups is high, there are several women entrepreneurs who fall into the category of being successful.

Khula has a mentorship programme which assists would-be entrepreneurs with information, preparation of business plans, and postfunding mentor services. Khula accredits independent contractors, who operate from regional offices in the provinces, to provide these services on a needs basis. The regional offices are open during office hours and SMMEs can make contact for whatever mentoring services they may require.

Regarding part 3 of the question, over and above a number of SMME initiatives of the DTI, the department has launched an annual entrepreneurship programme in July and August of every year. This is dedicated to public communication, information dissemination, consultation and advisory services.

In addition, the DTI has another outreach initiative: “Taking the DTI to the people”, which is led by my colleague, the Deputy Minister Elizabeth Thabethe. This seeks to inform existing and aspiring entrepreneurs about support services that the DTI and its agencies provide in provinces. Further to these initiatives, a partnership with the institutions of higher learning has been established through the Chairs of Entrepreneurship programme currently being developed in conjunction with the Wits Centre of Excellence, which focuses on targeting places of higher learning in disadvantaged areas. I thank you.

The ACTING SPEAKER (Mr G Q M Doidge): Order, hon members! Please, will all members be seated, and will you please lower the noise levels.

Mr L B LABUSCHAGNE: Thank you, Chair. Minister, the development of the second economy is cardinal to the wellbeing of South Africa’s populace. One wonders what the Small Enterprise Development Agency has actually achieved in bringing this about.

I have found that the average person I have spoken to within my constituency, which embraces a large element of the second economy, has really no idea of Khula, Apex, the IDC or Seda. There is a lot of government support out there, but they just don’t know about it - the very people we are trying to uplift in the second economy. You also mentioned that the failures were due to financial management, lack of skills and enterprise training. Now the question I would like to put to the Minister is this: Should Seda not be repositioned to provide a one- stop, walk-in service for potential entrepreneurs, and also to harness private-sector experience? I am thinking of grey power in particular. It should go further than just handing out forms. I don’t think Seda, as currently structured, is fully in that position.

The question really is and I’ll repeat it: Should Seda not be repositioned to provide a one-stop, walk-in service to assist the small entrepreneur? [Time expired.]

The DEPUTY MINISTER OF TRADE AND INDUSTRY (Dr R H Davies): Chairperson, my reply is that that is exactly what Seda intends to provide. I think the fact of the matter is that Seda has emerged from a long self-critical reflection on services that were provided to small businesses in the past. I think one of the points that we have acknowledged is that the services were not sufficiently targeted at very small and micro enterprises in the second economy. One of the major objectives of Seda is to be able to provide a service that makes sense to those parts of the economy as well.

The Seda programme is still in the roll-out phase, but the intention is to move in the direction of providing a one-stop service. It is trying also to build on the experience of the manufacturing advisory centres, the Macs, which provided a diagnostic service which was then able to identify further needs for small businesses. I think this was one of the most successful programmes which we had. However, it is a highly skills-intensive and resource-intensive service that is provided. We are trying as much as we can to roll out services of this sort within the human and financial resource constraints that we face. Thank you.

Dr R RABINOWITZ: Chairperson, hon Deputy President … [Laughter.] Deputy Minister, sorry! My question is exactly the opposite. I do not want to know about a one-stop service, but have you considered reaching the people by putting up mobile units?

You said you have an outreach programme. Does that include mobile services? Because there are thousands of micro enterprises involving women, but they lack accounting skills, and if they have to pay for auditing services, this can cost as much as R10 000 a year.

If they could apply for special support and special help in the form of a mobile unit which could assist them with accounting services and auditing services - would boost the entrepreneurial skills of millions of women in the country. I thank you.

The DEPUTY MINISTER OF TRADE AND INDUSTRY (Dr R H Davies): Well, the eventual aim of the Seda roll-out is to establish a Seda outlet at the level of each municipality in the country. How this will operate in terms of further outreach, I think, is a matter for the local management of the Seda concerned. If they consider some form of mobile outreach service, that would be fine.

Some of our programmes, including the one I mentioned that my colleague Deputy Minister Thabethe is leading are designed precisely to get the information out in as many people-friendly ways as we can. So I am sure that some of these ideas would be considered and, where relevant, would be taken up. I thank you.

Mr H B CUPIDO: Thank you, Chairperson. I would like to know from the hon Deputy Minister whether any progress has been made with the establishment of one supportive fund for women’s entrepreneurship organisations, as expressed by Elizabeth Thabethe in her address, Advancing Women’s Economic Empowerment Through Entrepreneurship, delivered in June this year. Could the Deputy Minister perhaps enlighten us on the fund?

The DEPUTY MINISTER OF TRADE AND INDUSTRY (Dr R H Davies): Chairperson, there is a process under way, which my colleague is leading, which is generally dealing with the issue of women’s empowerment and the promotion of women’s entrepreneurship. We are not yet at the point where we are able to make any announcements about that programme, but work is under way and I think within the fairly near future we will be making some announcements in this regard. Cofisa and its impact on addressing problems of social delivery and poverty alleviation

1. Mr E N N Ngcobo (ANC) asked the Minister of Science and Technology:

   (1) Whether, with reference to the second economy sector, the Co- operation Framework on Innovation Systems between Finland and South Africa, Cofisa, that was launched on 28 September 2006 is expected to make a real impact in addressing problems of social delivery and poverty alleviation, especially at provincial and local government level; if not, why not; if so, what are the relevant details;

   (2) whether, in light of the fact that South Africa’s gross domestic product of GDP of 0,94% in terms of its gross national expenditure, GDE, on research and development, R&D, is far below that of Finland, he will use Cofisa to persuade the National Treasury to adjust the current percentage of GDP in GDE on R&D to strengthen our own national system of innovation against that of Finland; if not, why not; if so, what are the relevant details?

          N1795E
   

The DEPUTY MINISTER OF SCIENCE AND TECHNOLOGY: Thank you, Chairperson. The answer to the first part of the question is yes, the Co-operation Framework on Innovation Systems between Finland and South Africa, known as Cofisa, has the overall objective of strengthening the national system of innovation in South Africa.

A critical focus of the Cofisa instrument will be on provincial and local government level innovation challenges, providing appropriate policy advice and identifying a range of strategic interventions to address these challenges, drawing on Finland’s experience in frontier science and technology and rural development innovations.

Cofisa has the potential to make a real and significant impact on service delivery and poverty alleviation at provincial and local government levels. It emphasises the importance of integrating national innovation activities into provincial-level economic strategies and to facilitate close working relationships and strong partnerships between the Department of Science and Technology, other national departments and the affected provincial and local government authorities.

Cofisa also fosters a spirit of collaboration between national public agencies, provincial and municipal spheres of government, the private sector and academia in order to generate sustainable economic growth and development.

Cofisa will draw on the Department of Science and Technology’s experiences of partnering with other institutions within the South African National System of Innovation including the Council for Scientific and Industrial Research, the Agricultural Research Council and universities in the implementation of a variety of technology-based poverty alleviation projects.

The answer to the second part of the question is no. Hon member, we do not intend to use Cofisa in any direct way to persuade the Treasury to increase allocations to research and development. However … [Interjections.] … Thought you might like that. However, the close relationship we have with Finland and the demonstration of the social and economic benefits derived from investment in science and technology will, no doubt, be influential in our discussions, not only with the National Treasury around increased public-sector investment in R&D, but also with the private sector.

We must remember that in the early 1990s, Finland was in an economic crisis. At the time, the mainstay of its economy was natural resources and forestry-based products. The collapse of the former Soviet Union meant the loss of Finland’s primary foreign market. Finland made the conscious decision to invest in research, science and technology as the core of its economic recovery and development strategy. Thank you.

Mr E N N NGCOBO: Thank you, Chair. Hon Deputy Minister, according to the Frascati Manual of the OECD, research and development is one of the innovation activities that may be carried out at different phases of the innovation process and it comprises creative work undertaken on a systematic basis in order to increase the stock of knowledge, including knowledge of man, culture and society, and the use of this stock of knowledge to devise new applications that seek to improve quality of life in society.

Many countries have failed to create a better future for their people. This is not because they have failed to predict the future, but because they failed to imagine their place in that future. It seems therefore that the hon Minister, by jointly launching with His Excellency the Ambassador of Finland the so-called Cofisa between Finland and South Africa on 28 September 2006, has been able to both predict and imagine South Africa’s place in global innovation systems of the future.

The question is: Will the hon Minister therefore review South Africa’s national systems of innovation with regard to the second economic sector to copy from some of the successful approaches followed in the global system of innovation, such as the Chinese example in which they adopted the so- called Corporate System of Innovation to develop the second economic sector? [Time expired.]

The DEPUTY MINISTER OF SCIENCE AND TECHNOLOGY: Thank you, Chairperson. I am not so sure about our ability to imagine the future, but I do think that our research and development strategy has a good sense of where we are going and certainly manages to create a vision for where we want to be in the future and certainly takes into account the likely changing scenario that we are facing.

We will not copy from any other country. We will obviously draw lessons from other countries in how they have designed their innovation systems and there are lessons to be drawn from many countries including Finland and countries in the East.

I don’t think that it’s incumbent upon us to try to impose or introduce lock, stock and barrel a system that works in some other countries, but I do think it is wise for us to examine systems and the extent to which they have achieved successes in their own countries and draw lessons from those countries and apply them to our own situation. Thank you, Chair.

Mr J P I BLANCHÉ: Mr Chairman, we are delighted to hear that the Minister is willing to reconsider some of the policies of his department. I do believe that we should not only concentrate on Finland, but that we should in fact be concentrating on what is happening in South Africa as far as technological innovation is concerned.

I want to refer to an example so that the Minister can see what I am referring to. Last weekend, the Smart Award was handed to a South African company from Kempton Park. The company is making road grader equipment which not only grades the road, but rolls the road and waters the road at the same time. This innovation is extensively used in Kenya and by our neighbouring countries. But the orders for the machine are very low …

The ACTING SPEAKER (Mr G Q M Doidge): Your time is running out, hon member.

Mr J P I BLANCHÉ: One would like to know how we are going to assist such organisations to be able to come forward with their innovations and, have them tested in South Africa so that they can produce and export.

The DEPUTY MINISTER OF SCIENCE AND TECHNOLOGY: Thank you, Chairperson, and thanks for the question. Indeed, we are a country of innovators and great inventors. I think one of our challenges is to convert those good ideas into commercially viable products. There the challenge is to get a good, strong intellectual property rights regime in place.

I noticed the Minister of Transport pricking up his ears when you spoke about this magnificent road grading equipment, etc. I am sure he will have a direct interest in the work that they are doing. However, the Department of Science and Technology’s side is to fund the necessary research to further the work and enhance the work that a variety of departments are doing to recognise genuine innovation and to create a framework which will give expression to that innovation.

You started off your question by saying you are glad to hear that we are reconsidering policies. Well, I didn’t say that. There is no particular policy that we are reconsidering.

However, to improve our work, we would certainly want to see ourselves on an ever-improving curve. If there are particular policies that you have in mind that you think don’t quite address the challenges that we face, please bring this to our attention and we will relook at them. Thank you.

Dr R RABINOWITZ: Hon Minister, there is a form of innovation that doesn’t need imagination; it just needs restoration and preservation and this relates to the indigenous knowledge within our country.

About eight or 10 years ago, we began to hear about an indigenous knowledge Bill from the Department of Science and Technology. I don’t believe that that Bill has yet materialised, and there is a vast amount of traditional knowledge relating to herbs and medicines that is not being developed because of problems with IP. Is there some thrust in your department or some added impetus that will be given to this sector through this new partnership? Thank you.

The DEPUTY MINISTER OF SCIENCE AND TECHNOLOGY: Thank you, Chairperson. There is a lot of poetry in your question: preservation, conservation and innovation. But the question is good. We have greatly strengthened, as you will notice if you read our annual report, our Indigenous Knowledge Systems Unit in the Department of Science and Technology.

That Bill is in a sort of late stage of preparation and will come to Parliament. I can’t give you a date right now, because I didn’t prepare myself with that information. We will pass that information on to you and let you know exactly at what stage that Bill is – but it’s very advanced at this point.

You are quite right in saying that indigenous knowledge holds tremendous potential to address the variety of social challenges that we have in our country, and we recognise that in our department.

The Bill is intended to give that knowledge that we have in our society due recognition, to give it the necessary protection in terms of the intellectual property rights systems that we have in place and to encourage further research work to draw on the existing knowledge that we have within our communities. Thank you.

Economic partnership agreement between the European Union and South Africa

1. Mr S J Njikelana (ANC) asked the Minister of Trade and Industry:

   In light of a recent report tabled by the European Commission (details furnished), what is the current state of development of an economic partnership agreement, EPA, between the European Union and South Africa? N1791E

The DEPUTY MINISTER OF TRADE AND INDUSTRY (Dr R H Davies): Chairperson, in South Africa’s view, and one which is shared by other SADC members involved in negotiating an economic partnership agreement – EPA - with the EU, the Southern Africa region can use the EPA negotiation process to develop a regional approach to our trade relations with the EU.

The SADC-EU-EPA negotiations were launched in July 2004 and the mid-term review of the South Africa-EU Trade, Development and Co-operation Agreement was initiated in 2005. The timing of the review and the concurrent EPA negotiations offer an opportunity to consolidate a regional trade arrangement between the countries in Southern Africa and the EU.

To this end, the SADC-EPA Trade Ministers met in February 2006 and adopted a proposal that would draw South Africa and other SADC members into a negotiating process, which is intended to lead to a single trade regime with the EU. This proposal represents a political consensus among the SADC- EPA members, including South Africa. It establishes a set of technical and legal parameters to achieve a positive negotiation outcome by December

1. At the time, the current arrangement between the EU and the African, Caribbean and Pacific countries expires. Thank you.

Mrs F MAHOMED: Thank you for the response, hon Deputy Minister. We acknowledge that we are no longer isolated from the global community and that, in fact, we have become an active global player with major economies. Indeed, the European Union is South Africa’s most important economic trade partner, and this partnership is expressed in the following ways: trade, development, co-operation, sociocultural co-operation and political dialogue.

Deputy Minister, I wish to express my concern. My concern is: How effective is implementation of international trade agreements, and do they really take place in terms of their implementation?

Deputy Minister, I would also like to ask you to please detail your comment on the review process of the South African–EU trade development co- operation agreement. Perhaps you could explain to us if this process will contribute to effective implementation and realisation of the contents of that particular agreement. We have a tremendous challenge in the SADC region to understand the impact of these agreements on the second economy, that is the poorest of the poor. Thank you. [Time expired.]

The DEPUTY MINISTER OF TRADE AND INDUSTRY (Dr R H Davies): The Trade Development Co-operation Agreement, or TDCA, as the member indicated, has a number of aspects to it. One of them is the trade component. The trade component consists, in part at least, of a series of tariff reduction commitments. I think that both sides are on track to implement the tariff reduction commitments that were agreed to and began to be implemented in the year 2000. So, I think that as far that aspect of market access is concerned it’s moving ahead.

However, regarding where the hon member wants to go, the fact that you have formal market access in terms of tariffs regimes doesn’t necessarily mean that all enterprises and particularly those in the second economy are poised to take advantage of these opportunities. That depends on issues to do with real economy capacity constraints. This is actually a fairly massive challenge, becoming more so in view of the fact that there is a tendency in Europe to be raising the bar on issues of standards and potential technical barriers to trade.

Some of these issues are under discussion in the mid-term review. But, the point about the mid-term review and the EPA negotiations is that the two are basically aimed at reaching and improving on free-trade agreements.

The understanding which is now being reached between ourselves and other members of the SADC negotiation configuration is that we will now harmonise these two processes, and whatever we seek to improve in the TDCA we would also seek to extend those improvements to the other members. And, whatever they manage to succeed in in the EPA negotiations, we would hope that that would be extended to us as well. Thank you.

Dr P J RABIE: Hon Chairman, hon Deputy Minister, one of the reasons for the collapse of the Doha talks in Geneva in July this particular year was that some of the developed countries like EU members and the USA were very reluctant to lower tariffs on agricultural products.

Now my question to you, hon Deputy Minister, is: In your talks with the EU, is there a possibility that some of the tariffs on agricultural products - and you have alluded to the fact that the bars have been raised by some of the EU members - will be relaxed on some of our agricultural products and, in particular, on our canning industry in the Western Cape which has been badly hit by the high tariffs of the EU? The DEPUTY MINISTER OF TRADE AND INDUSTRY (Dr R H Davies): Well, I think that it is not just tariffs, but also subsidies that are under discussion in the WTR. Both of these are major barriers, among other things, in the canning industry, which the hon member has mentioned.

I think that our approach has always been, when we negotiated the TDCA, that we were unlikely to achieve major reform of agricultural trade on a bilateral basis with the European Union and, in fact, we didn’t. Most of the products that were left out of the TDCA on the European side are agricultural products, and that is why we put our effort into the WTO process.

The member uses the term “collapse”. I think the actual term is “suspension”. There is work under way now; lots of consultations and discussions to see whether there are various windows of opportunity to restart those negotiations. But I think we would be looking to the multilateral process to achieve a significant breakthrough both on the issue of agricultural tariffs and perhaps on the more difficult question of agricultural subsidies. Of course we will be raising these matters in the bilateral processes as well. I think our expectations are a bit higher in the multilateral process. Thank you.

     Basic fuel price mechanism and high fuel prices in country

1. Mr M H Matlala (ANC) asked the Minister of Minerals and Energy: (1) What is her department doing to address the problem of high fuel prices;

   (2) whether the current basic fuel price mechanism is still the right pricing mechanism for the country; if not, why not; if so, what are the relevant details? N1800E

The MINISTER OF MINERALS AND ENERGY: Thank you very much, Chairperson. The answer to the first part of the question is as follows. South Africa, being a non-oil-producing country, has this particular matter as its biggest challenge. We continually investigate ways of mitigating the impact of high oil prices, but we have limited options that are available to us. The department has in the past used the equalisation fund to minimise price increases, but this mechanism does not address price increases. It only cushions the effects of the price volatility.

The answer to the second part of the question is, yes, the import parity price is still relevant to fuels. A recent global fuels pricing report indicated that South African basic fuels price, in US dollar terms, compares very favourably with the basic fuels prices in other countries worldwide. Since the beginning of 2006, South Africa has begun to import finished products, because our local refining capacity is almost exceeded by local demand, and indeed we are quite concerned about the security of the supply of fuel.

The country will, henceforth, need to import the finished product until a new refinery is built, or existing refineries are expanded. If our local prices are lower than import prices, these imports will not be made, thereby putting the country at risk. Thank you, Chairperson.

Mnr J J COMBRINCK: Voorsitter, hy is nie vandag hier nie, so ek sal die opvolgvraag stel.

Voorsitter, agb Minister, met dié dat die plaaslike vraag na brandstof al hoe meer styg, is daar enige planne om nuwe raffinaderye op te rig en gaan enige van die oues wel uitgebrei word? (Translation of Afrikaans paragraphs follows.)

[Mr J J COMBRINCK: Chairperson, he is not here today, so I will ask the follow-up question.

Hon Minister, seeing that the local demand for fuel is increasing steadily, are there any plans to build new refineries and will any of the old ones, in fact, be expanded?]

The ACTING SPEAKER (Mr G Q M Doidge): I am not sure if the Minister was able to follow.

The MINISTER OF MINERALS AND ENERGY: My Afrikaans is nie baie sterk nie, meneer. [My Afrikaans is not very good, sir.] The ACTING SPEAKER (Mr G Q M Doidge): Let’s ask the member to repeat the question. Will you get your device working?

The MINISTER OF MINERALS AND ENERGY: Yes, please. I was distracted when the question was asked. I am sorry, hon member.

Mr J J COMBRINCK: Agb Minister, met dié dat die plaaslike vraag na brandstof al hoe meer styg, is daar enige planne om nuwe raffinaderye op te rig en gaan enige van die oues wel uitgebrei word? [Hon Minister, seeing that the local demand for fuel is increasing steadily, are there any plans to build new refineries, and will any of the old ones, in fact, be expanded?]

The MINISTER OF MINERALS AND ENERGY: Well, definitely, hon member, being concerned about the security of supply of fuel in the country, we indeed have a problem of storage, which means therefore that we need refineries. But we also have a problem with the transportation of fuel from the coast to the inland areas. That also is infrastructure that this country needs.

Yes, there are quite a number of projects that are still in the pipeline, and I still have to crack the pipeline open, and bring the information to the House. At this point, I am not able to disclose that particular information, but indeed we are doing something about it.

Dr R RABINOWITZ: Hon Minister, do you have any plans or strategies for developing the use of renewal forms of energy, such as removing levies from people who produce biodiesel, or providing special incentives and maybe tax incentives to people who use renewable energy of other forms? That would make a huge contribution to reduce the pressure on the use of oil and other fuels.

The MINISTER OF MINERALS AND ENERGY: Well, we are working on a strategy for biofuels and biodiesel and all of those things. In November we will be submitting that. Anything that is related to levies is a money issue, so it would be the Minister of Finance that would be looking at either levies or subsidies, working together with the Department of Minerals and Energy.

I hope that the strategy for biofuels, which would also look into biodiesel, would look into the matter that you are raising. Indeed, as I said, we will be presenting it to Cabinet in November. We hope to start implementing it next year in January. We will be taking on board all of these concerns that people are raising, and all of these matters that would help enhance what we are doing. I have taken note of your point on this.

Adv H C SCHMIDT: Thank you, Mr Chair. The DA agrees with the view that the high fuel price is a problem, in fact, a major problem, and that an alternative pricing mechanism ought to be developed to, if possible, reduce the price of fuel. We believe that a greater degree of self-sufficiency and reliance in the supply of fuel would prevent an increase in the current balance of account deficit that exists and the resultant positive economic spin-offs.

The question is basically, although along a different line, whether any progress has been made with regard to the development of a new refinery, such as Sasol IV, versus a policy in which, as I think Ms Nhlanhla Gumede, the director of hydrocarbons has indicated, there is a possibility of importing fuel and not more on the issue of self-reliance with regard to the production of fuel. Thank you.

The MINISTER OF MINERALS AND ENERGY: Surely, you need a number of initiatives. You can’t rely on one answer in this particular matter. As for the issue of Sasol IV, again, I am not able to respond to that matter. Indeed, we are looking at all of this as answers. One of the things that we are looking at is entering into a strategic partnership between the private sector and the public sector to address this matter. It is a matter that is uppermost on my agenda.

We are facing 2010, and there will be a challenge. We will need an increased fuel supply in the country. It does preoccupy my mind a lot, but indeed the House will get a report when I am ready. Thank you very much.

Mr H B CUPIDO: Thank you, Chairperson. I listened to the answer of the hon Minister when she referred to the fuel levies. I wonder if the Minister would be prepared to just enlighten us on why the pump price in South Africa is much higher than the pump price for fuel in landlocked countries like our neighbour Lesotho, for instance?

The MINISTER OF MINERALS AND ENERGY: That is a very difficult question for me, but maybe I will respond to that question from the experience of South Africa. The fact that you are transporting fuel from the coast to inland areas does have an impact on the price or on the cost of fuel inland. So surely the consumer will incur the cost? That is the situation, and I am sure that it is the situation with Lesotho.

If the hon member wants a specific response about Lesotho, I could come back if you put your question again, and I can respond specifically. As for South Africa, that is the situation.

               Shortage of strategic technical skills

1. Mr E N N Ngcobo (ANC) asked the Minister of Science and Technology:

   Whether, in view of the critical shortage of strategic technical skills (details furnished) for our fast growing economy, he has any plans of a holistic approach involving other relevant ministries in the relevant clusters, as well as other stakeholders and advisory bodies such as the National Advisory Council on Innovation, NACI, and Parliament, over and above the effort of the Joint Initiative on Priority Skills Acquisition, Jipsa, in addressing these difficulties; if not, why not; if so, what are the relevant details? N1794E

The DEPUTY MINISTER OF SCIENCE AND TECHNOLOGY: Chairperson, the answer is yes. The Department of Science and Technology, or DST, is part of the economic and employment cluster which established the skills focus group in

1. The skills focus group consists of the Department of Science and Technology, the Department of Education, the Department of Labour, the Department of Trade and Industry and the Department of Home Affairs, and is primarily responsible for national human resource development.

The skills focus group deals with all long-term human resource matters and submits its recommendations to the cluster for endorsement. For instance, the skills focus group has developed quota scarce and critical skills and master scarce and critical skills lists which are at advanced stages of finalisation.

The quota scarce and critical list is used to facilitate the issuing of work permits by the Department of Home Affairs and is gazetted annually. The Master Scarce and Critical list addresses both absolute and relative scarcity of skills, now and in future, and will be submitted to Jipsa and subsequently to Cabinet for approval. The DST submitted its input into this process. Other DST plans include the following. Chairperson, just stop me when I run out of time because there are a lot of them. There is the science, engineering and technology human capital strategy, which is being finalised and will consist of a technical skills section with measurable indicators. There is the 2005 human resources for knowledge production conference follow-up project which is currently under way. The main aim of the project is to identify and recommend implementation plans for various resolutions taken at the conference. This should be done by April 2007.

The Department of Science and Technology recently hosted an academic support and life-skills workshop that focused on the current low science, engineering and technology student retention and throughput rates. All higher education institutions and the Department of Education attended the workshop.

The DST and Tshumisano are currently establishing a tooling institute. It is expected that some of the 30 students that the department sent to India between 2004 and 2006 will join this institute. The Department of Science and Technology, and the Department of Provincial and Local Government and the Department of Water Affairs and Forestry awarded bursaries and are currently giving stipends to 15 masters students in disaster and risk management.

The DST and the Department of Transport are currently training 10 students on freight logistics. The DST is currently running an internship programme. There are about 74 interns with strategic technical skills placed at the DST, the CSIR, Mintek, LifeLab, the SA Bureau of Standards, the SA Nuclear Energy Corporation, the SA Institute for Aquatics, and the SA Agency for Science and Technology Advancement. These are some of the things the DST does in order to make a significant contribution to human resource development in our country.

The ACTING SPEAKER (Mr G Q M Doidge): You just made it, hon Minister, with one second to spare.

Mr E N N NGCOBO: Chair, in view of this urgency of critically scarce skills in fields like veterinary science, nuclear energy technology, cryogenic engineering and so forth, would the Minister, as a matter of urgency, convene a national workshop that would involve all the relevant stakeholders, such as the chemical industry which has a serious shortage of skills, and all other relevant departments like the Department of Labour and the Setas, so as to try to address this problem as a matter of urgency, with all viewpoints from all relevant stakeholders? Thank you.

The DEPUTY MINISTER OF SCIENCE AND TECHNOLOGY: Chairperson, I suppose we can take that as a recommendation or an appeal. But I must say that the main departments responsible for skills development and the shortage of scarce skills would be the Department of Labour and the Department of Education.

However, we make our contribution as the Department of Science and Technology. We participate in these processes and we will continue to do so. In so far as there are scarce skills that are critical to the needs of the science environment in our country, we will engage with those relevant departments, which are the primary departments responsible for this programme. Thank you.

Mr J P I BLANCHÉ: I want to thank the Minister for that frank reply, because I think everybody in this Chamber agrees with him that there is an extreme shortage of technological people in this country. To send 30 people to India to become toolmakers is totally inadequate if we want to address the present situation in the manufacturing industry in South Africa.

The world is opening up its markets, Mr Minister, and skilled nations are racing not only to get their share of that market but to increase their share of that market. The Public Works committee just recently returned from Wales where we visited a factory at which they produce 600 bridges a year. This just shows how the skills have changed in Europe compared to where we are in South Africa.

We still need to rebuild some 280 bridges in South Africa and we will be doing it the old way, not in the way the Welsh are doing it. For that reason, I think, this cluster of Ministries should realise that there is an urgent need for skilled people. We import vast numbers of motor cars into South Africa. Where are the trained motor mechanics, the trained spray painters, etc, etc? Thank you. [Time expired.]

The DEPUTY MINISTER OF SCIENCE AND TECHNOLOGY: There are few developed countries if any in the world that do not import cars. We certainly have a fast growing automotive industry in our country. That, we can say, is one of our success stories in terms of our economic performance in our country. But it is true that we lack certain skills. It is difficult. I wouldn’t want to refer to it as a crisis, but it is a huge challenge, a challenge I think that the Minister of Labour and the Minister of Education are acutely aware of.

I think the initiative called Jipsa is very important to address this shortage of scarce skills. I think the participation of the private sector and labour in Jipsa is very important as well. They make a major contribution to this process of identifying and analysing the particular problems that exist and putting in place a framework which will help to address the problem.

You can name just about any trade and you will find that we do have shortages – a severe shortage of welders, toolmakers, etc. These are areas of critical shortage, that is true. But it is also true that this is partly a reflection of our fast-growing economy, in the sense that the demand for such skills is totally outstripping supply.

However, I don’t want to say that we have done well enough on the supply side and on the training side. I think it remains a very significant challenge. We are aware of it. I think that you are right to emphasise the need for us to keep driving it and to ensure that we have the necessary skilled personnel in our country to meet these economic challenges. Thank you.

           Auditor-General’s audit opinions on agriculture

1. Dr A I van Niekerk (DA) asked the Minister for Agriculture and Land Affairs:

   Whether, with reference to the audit opinions expressed by the Auditor- General on the financial statements for the 2005-06 financial year for the (a) Agricultural Debt Account, (b) Agricultural Research Council and (c) the Land and Agricultural Development Bank, she will be taking any steps against any of the relevant accounting officers, financial management and internal audit officials; if not, why not; if so, what are the relevant details? N1815E

The MINISTER FOR AGRICULTURE AND LAND AFFAIRS: Thank you, Chairperson. No steps will be taken against the accounting officer, financial manager and internal audit officials. The agricultural debt account is constituted in terms of the Agricultural Debt Management Act, Act 45 of 2001, and administered by the Department of Agriculture.

Debts resulting from loans granted by the former Agricultural Credit Board are recovered and paid into the mentioned account. These loans are managed in terms of contracts between the department and debtors, with recovery periods of up to 20 years or more.

For the past three financial years the National Treasury granted the department exemption for adhering to the standards prescribed in respect of financial instruments for accounting purposes. Such exemption was, however, not granted for the 2005-06 financial year and the account was therefore qualified by the Auditor-General. This is, at most, a technical qualification in the sense that the accounting system applied by the department for the past few years has not fully met the general accounting practices as prescribed by the National Treasury for trading entities.

It must be mentioned, however, that the department does not agree with the classification of the account as a trading entity. It should be noted that meetings have already started and have been concluded, and arrangements have been concluded with both the Office of the Auditor-General and the National Treasury in order to rectify the above.

It should be noted again that the Auditor-General did not criticise the correctness of the accounting records such as loan accounts, etc, but the application of the financial instruments on consolidated loan and other account balances. The management of the account on a day-to-day basis was financially sound.

The next question, which is the qualification on the financial statements of the Agricultural Research Council, was on two matters. The first one is noncompliance with the International Accounting Standard 16 Evaluation of Property, Plant and Equipment.

The second matter was the existence of accounts receivable with respect to VAT on PG. International Accounting Standard 16 relates to the re- evaluation of assets and evaluation of useful life of assets. This standard was not, until December 2005, harmonised to the South African general applied accounting practice. The re-evaluation policy on assets by the Agricultural Research Council prescribes that assets are evaluated every two years, whilst the standards prescribe that they be evaluated each year.

However, prior to the end of the financial year, the Agricultural Research Council had already started with the process of using a property company to conduct valuations on the land and buildings of the Agricultural Research Council. The Agricultural Research Council has further been in contact with the accountant-general to get guidance about implementation of the public sector standards.

The Agricultural Research Council’s VAT status was changed in October 2005 after the transfer from Vote No 25: Agriculture was made and paid over to the Agricultural Research Council without VAT input. This change in VAT status required that the parliamentary grant received from the department should have included a 14% VAT on the PG.

At year-end, discussions were entered into between the Agricultural Research Council, the department, and the National Treasury with regard to VAT input owed by the Agricultural Research Council to Sars. The department has agreed to make a submission for the funding of VAT through Adjustment Estimates. However, there was no sufficient evidence to assist the external auditors. Given these compliance-related matters raised above, it is evident that compliance was dependent on authority outside the ARC as an organisation. [Time expired.]

Dr A I VAN NIEKERK: Hon Chair, I want to say thank you to the hon Minister for the explanation in this regard. As you have well stated, many of these problems that have been experienced in the different accounts resulted basically from technical points to a large extent. Within your department you are suffering because of a vacancy rate of 25%, and there has been an exodus of qualified people from the department. My question to you is: Does this situation have anything to do with that? What are you doing in this regard? For instance, the Agricultural Research Council has outsourced some of its functions to get expertise in order to comply with this. Are you considering outsourcing some of these functions in view of the problems that you experience in filling the vacancies within your department, because I think it is very important that we get the agricultural family accounts on track again in this regard? Thank you.

The MINISTER FOR AGRICULTURE AND LAND AFFAIRS: Thank you, hon member. I should just explain that the vacancies in the department are not 25% but 19%, as we speak. This was due to the restructuring within the Department of Agriculture. At the moment we are busy looking and we have already advertised quite a number of posts. We are in the process of interviewing. We have already employed a few senior managers whose posts were vacant in the last three months, and we will continue with the interviews in the coming few months.

We have to ensure that there is transformation and we have to ensure that there is gender representivity. So, perhaps some of the problems or challenges arise from the fact that it is not easy to find the right balance in terms of meeting our equity standards and the requirements for transformation. Thank you, Chairperson. Mr H J BEKKER: I thank the hon Minister for her reply. She has stated that the problems probably occurred through the cash basis of accounting instead of the required accrual accounting, as required by the Public Finance Management Act.

I just want to enquire regarding the queries relating to value added tax whether the hon Minister could give us the assurance that the next time the Auditor-General investigates and audits these aspects, these institutions will indeed be on the accrual system; and whether they will be able to render better accounting systems for Parliament? Thank you.

The MINISTER FOR AGRICULTURE AND LAND AFFAIRS: Thank you very much, Chairperson. Thank you to the hon member. Definitely, we have a new council that has been appointed and a new CEO. Therefore I do believe and expect that in light of the fresh blood that has been ushered into the Agricultural Research Council, these will be new brooms that will sweep clean. As I have already mentioned, arrangements are in place and negotiations have been made for the new system. Thank you very much.

Mr S ABRAM: Chairperson, in concluding the question asked by the hon Van Niekerk - he naturally seeks relevant details - I would like to say that the hon member is a very old hand in parliamentary procedures. In fact, he has a quarter of a century’s experience. I was a bit disappointed but he apologised that he could not be present when the Land and Agricultural Bank appeared before the portfolio committee last Tuesday.

Nevertheless, the hon member is also aware that the Department of Agriculture, which will have to report on the agricultural debt situation as well as the Agricultural Research Council, will be appearing before the committee in the weeks to come. I therefore believe that the hon member could have gotten all the details he wanted by engaging those entities when they appeared before us. Hon Minister, could you just indicate …

The ACTING SPEAKER (Mr G Q M Doidge): Order! Hon member, your time has expired.

ACP-EU Joint Parliamentary Assembly support for economic partnership
                          agreement process

1. Mrs B M Ntuli (ANC) asked the Minister of Trade and Industry:

   How will the delegation representing South Africa at the upcoming African, Caribbean and Pacific countries-European Union, ACP-EU, Joint Parliamentary Assembly in Barbados in November 2006 support the economic partnership agreement process in order to secure the best interests of South Africa and its neighbouring countries? N1793E

The DEPUTY MINISTER OF TRADE AND INDUSTRY (dr R H Davies): Chairperson, the African, Caribbean and Pacific countries–European Union Joint Parliamentary Assembly, or JPA, is a gathering of parliamentarians from ACP countries and the EU member states. As such, it is up to the relevant parliamentary bodies and hon members who are deployed to the JPA to assess how best to advance the interests of South Africa and other developing countries in the economic partnership agreement process currently under way between ACP countries and the EU.

In general terms, South Africa has always supported the view that the economic partnership agreement, EPA, process should result in enhanced real access to the European Union market for products from ACP countries, as well as improved resource flows to address supply capacity constraints. Any reciprocal concessions from ACP countries should fully respect the principles of asymmetry and differentiation, and not impose unmanageable adjustment costs on ACP countries.

As far as our own SADC-EPA negotiating group is concerned, the EPA process should promote and not undermine current processes of regional integration in Southern Africa. In this light, the EU should positively respond to the proposal agreed to by the SADC-EPA Trade Ministers in February 2006, to draw together the EPA processes with the mid-term review of the South Africa-EU Trade, Development and Co-operation Agreement. We believe that the EU should no longer treat South Africa differently from the rest of the region as regards the region’s trade arrangements with Europe. Thank you.

Mrs B M NTULI: Thank you, Chairperson. Deputy Minister, in previous meetings of this forum, collaboration focused mostly on the joint initiative for South Africa’s participation in the sixth framework programme and the strengthening of the policy dialogue on harnessing science and technology for sustainable development, as well as co-operation in multilateral forums such as the World Summit on Sustainable Development with the ACP group of states.

South Africa’s treatment was separate from SADC and funding was allocated by the EU for South Africa’s FP5 thematic projects. The question is: If the proposal that will be put forward to remove the dichotomous division between South Africa and SADC trade arrangements with the EU to advance regional development succeeds, is funding going to be directed to SADC? How are the SADC countries going to manage this fund? Thank you.

The DEPUTY MINISTER OF TRADE AND INDUSTRY (Dr R H Davies): I would imagine that there would be a series of bilateral programmes with each of the SADC countries and then also a programme of support for the regional integration process as such.

The principle is that we would want to see the regional integration programme driven from within the region itself and not as a kind of by- product of negotiations which we are having with an outside party, in this case the EU. I think that on the trade front we are calling for there to be a harmonisation of trade regimes.

I think we would look to support for regional integration. Also, since regional integration, at least at this stage, is not going to end national efforts to overcome underdevelopment, we would want to see generous contributions to national development programmes as well. Thank you.

The CHIEF WHIP OF THE OPPOSITION: Chairperson, thank you. Minister, it is clear with the failure of the Doha round and the WTO talks aimed at restarting the process that not many countries will give handouts to South and Southern Africa. In return for concessions to us they want concessions in return. It is, of course, imperative that we take all steps necessary in concert with other nations, including those in the ACP-EU regions, to promote ourselves and our trade. The Minister speaks with such passion about that forum; I think perhaps he should accompany us for old times’ sake and help us to give the Europeans a little stir.

In addition to those initiatives, there is a much more important one. That is one that we must take at home. I’d like to ask the Minister exactly what steps the government is taking to make South African exports more innovative, more attractive, more competitive and more sought after. The DEPUTY MINISTER OF TRADE AND INDUSTRY (Dr R H Davies): Well, I think that there are a number of legs. One of the legs is what the hon member was referring to just now and that is the competitiveness agenda. There is a lot of work that is involved in that through the sector work, which our department is sponsoring, and the new industrial policy framework will certainly have that as a key objective.

The other leg is that we need to recognise, in terms of the current international trading environment, that South Africa was excluded from many of the more favourable trade arrangements. We largely managed to deal with that through negotiations in the first few years of our democracy. We are now addressing the question of some of the imbalances and inequities in the global trading system.

We would want to look to any initiatives, including the EPA initiative, including the WTO process - that I don’t think, as I said earlier, is quite dead; it’s under suspension and could go in a number of different directions and we need to be preparing for all those possibilities - to achieve a more equitable arrangement so that market access can be enhanced in real ways through tariffs, through subsidy reductions and through the reduction, if not the elimination, of technical barriers to trade. Thank you.

     Security of energy supply relating to 2010 Soccer World Cup

1. Mr S K Louw (ANC) asked the Minister of Minerals and Energy: Whether systems currently in place are adequate to ensure security of energy supply, specifically as far as the upcoming 2010 Soccer World Cup tournament is concerned; if not, why not; if so, what are the relevant details? N1799E

The MINISTER OF MINERALS AND ENERGY: Chairperson, hon member, regarding the present situation, our liquid fuel supply is adequate to meet the current demand, that is if there is no major upset to change the situation in the near future. However, the upcoming 2010 Soccer World Cup will impose additional energy demands on South Africa. My department is on course with plans to meet the increased demand.

A fuel strategic supply task team, FSSTT, which is a private-sector- government collaboration, was formed and tasked to develop and implement short, medium and long-term fuel supply strategies. The fuel strategic- supply task team has commissioned a study that is investigating the current supply value chain which will now be concluded in December 2006. The study will indicate the problem areas and provide options for solving all identified supply and logistical problems. The fuel demands for the 2010 Soccer World Cup tournament are factored into the study.

The department also participates in the interdepartmental committee on the 2010 World Cup tournament. The outcomes of the FSSTT study, with regard to the 2010 Soccer World Cup tournament, will also be given to this committee to arrive at a consolidated government position on the tournament.

From the electricity perspective, a national study has been done regarding the electricity needs. The national integrated resource plan is a supply- demand projection of electricity over a period of 20 years. It is currently being updated in light of the improved economic environment that is anticipated around 2010.

At the disaggregated level, the electricity needs in the respective host cities are also known, and we can confirm that there is enough capacity in all of the host cities. Additional plans are being put in place to ensure that the electricity supply, whilst available, is also reliable and that the risk of blackouts during the World Cup is mitigated. Thank you very much.

Mr S K LOUW: Thank you, Chairperson. Minister, is the department making progress with the Moerane commission’s recommendation to consider changing the current policy regulating the importation of refined petroleum products to include third-party suppliers?

The MINISTER OF MINERALS AND ENERGY: Well, definitely, hon member. The department, together with SA Petroleum Industry Association, Sapiais working very hard to ensure that we implement the Moerane commission’s recommendations, one of which you have alluded to. However, there was also a programme that was running parallel to the Moerane commission project in terms of which we had developed guidelines for imports and exports. I have recently approved the promulgation of these guidelines and they should be published in the Government Gazette before the end of next week.

One of the major changes that we have made is to permit licensed historically disadvantaged South African wholesalers to import finished petroleum products and blending components, noting that only refiners are currently permitted to import petroleum products and blending components. So, yes indeed, we are doing something about it, hon member. Thank you, Chairperson.

Adv H C SCHMIDT: Hon Chair, it is envisaged that South Africa will become a net fuel-importing nation within the next two years, by the latest 2009, based on the current annual increase in the demand for fuel. The major concern relates to the inland where it is expected that the availability of fuel will be under pressure during the World Cup. This relates to problems in the transportation of fuel inbound. This is due to the lack of availability of rail transport and sufficient petroleum pipelines.

The question is, hon Minister: When do you expect to implement the arrangements to provide for a sufficient supply of petroleum, particularly to the inland during the World Cup? We take note of all the studies, but we are concerned that by the time some of these studies are completed, the time period for implementing some of the recommendations of these studies - building pipelines and the rest - will be a bit too short. Thanks, hon Chair.

The MINISTER OF MINERALS AND ENERGY: All of these matters are on the agenda of the department, for me and Sapia, especially the issue of transportation, as I said earlier on, as well as the capacity in refineries. So we are really working very hard to ensure that this happens.

I am not able to disclose anything at this stage, but there are certain things that are happening. At this point, it is very difficult to give information. I will just appeal to the House to be a little patient. We will come back to you.

We are busy with the pipeline, because it’s part of the recommendations from the Moerane commission to ensure that we do have a system that will help us transport fuel from the coastline to inland areas. But, again, the issue of the fourth refinery with regard to Sasol is something that has been spoken about, but at this stage it’s very difficult to disclose where the developments are.

Mr L B LABUSCHAGNE: Mr Chair, I was wondering whether I can ask Mr Louw a question relating to transport as to whether he has paid his taxi bills.

The ACTING SPEAKER (Mr G Q M Doidge): No, Mr Louw is not taking any questions this afternoon.

Taxi recapitalisation programme, the vehicle construction industry and the SABS

1. Mr S B Farrow (DA) asked the Minister of Transport:

   Whether he has been informed of major discrepancies which exist between recently gazetted technical regulations for the taxi recapitalisation programme and the vehicle construction industry, with particular reference to roll-over protection and seat space widths and configuration; if so, why were the SA Bureau of Standards and the vehicle manufacturers not consulted by his department before the regulations were published?

           N1818E
   

The MINISTER OF TRANSPORT: Thank you, Chairperson. The answer is no, I am not aware of any major discrepancies that exist between the recently gazetted technical regulations for the taxi recapitalisation programme and the vehicle construction industry.

I would, however, like to explain the critical issue related to roll-over bar protection for minibus taxis. When the September 2005 requirements were published, the SA Bureau of Standards still had some technical work to complete. I subsequently met with the SABS and the vehicle manufacturing industry at the end of September 2006 at which time we clarified all these issues. Consultation between the department and the vehicle manufacturing industry has been ongoing throughout the taxi recapitalisation process. Thank you.

Mr S B FARROW: Thank you, Minister. I raised this question purposely because, as you are aware, the portfolio committee was recently addressed by Santaco and the other taxi association, and this was one of the issues that came to the fore. Clearly, there were some regulations which were not compliant and in particular the issues relating to seat configuration.

Now the new taxi vehicles have certain specifications relating to that, and yet it appears that the owners are adding seats to these particular vehicles, which automatically either makes them overloaded or they continue to be safety infringers. The very fact, Minister, that the weights in those seats are exceeding the 68kg limitation, specified in the Act, seems to be a flaw.

It is impossible to enforce, because how do you weigh people when they go into each and every taxi as they all have different weights? I would just like to say that this industry, according to the report, seems to be battling with rising costs and competing for the same ranks. So, obviously, they are trying to squeeze more passengers in, which is why I brought this question up.

The ACTING SPEAKER (Mr G Q M Doidge): Hon member, your time has expired. Would you like to respond, hon Minister?

The MINISTER OF TRANSPORT: I didn’t hear the question.

The ACTING SPEAKER (Mr G Q M Doidge): The member will miss that opportunity.

Ms N P KHUNOU: Thank you, Chairperson. Could the Minister indicate whether adequate time will be provided to manufacturers to adjust production lines to some of the more challenging new regulatory requirements, for instance the introduction of roll-over bars in minibuses? Thank you, Chair.

THE MINISTER OF TRANSPORT: I just want to assure the hon member that on 28 October 2006, in two weeks’ time, in Botshabelo in the Free State we will be starting the actual process of scrapping the old taxis in South Africa and introducing new taxi vehicles. As we speak the SA Bureau of Standards is busy certifying minibus taxis and midi-buses so that we will be able to unveil the new taxi vehicles. So, as I sit here I am very confident that we are on track in terms of rolling out the taxi recapitalisation programme. [Applause.]

Mr S B FARROW: Thank you, Chair. Sorry, I was in the wrong seat when I pressed there. I put the point over to you, Minister. What I wanted to ask was: Would you consider, rather than dealing with Santaco as a whole and having this confusion down at the bottom, bringing to the notice of taxi associations on a piecemeal basis a plan to integrate them with the present public transport initiatives that are being considered at the moment?

We have seen success stories of this happening in other places in the world like in Bogotá. I was just wondering whether you wouldn’t consider this as a better medium to try to get the message through and ensure that these people now focus on the issues of public transport as an integrated process, together with the compliance and the law enforcement that goes with this problem that we are sitting with. Thank you, Chair.

The MINISTER OF TRANSPORT: Santaco is the official voice of the taxi industry in South Africa. I meet with them all the time. My director- general and my senior officials meet with them all the time. Even yesterday I was with Santaco in Johannesburg and with Sapia at which they were starting a very exciting programme of self-regulation in support of the industry as a whole.

The meeting that I referred to in my answer on 28 September was with Santaco, the vehicle manufacturers, the commuter organisations and the financial institutions, together with the SABS. So, all the decisions that we take as government are with the consent and understanding of Santaco. In any event, we fund them because they are the ones in 2001, during the time of the late Dullah Omar, that wanted – and we also want – to be formalised within the public transport system.

I indicated in the earlier questions that next week Sunday we are having a public transport indaba and Santaco is going to be there. We are going to further explore the plan for public transport in South Africa. So I am very satisfied that they are very much on board and we are going to be rolling out this programme.

       Distributing agency for funds from the National Lottery

1. Mrs X C Makasi (ANC) asked the Minister of Trade and Industry:

   Whether he has taken any steps to ensure that the distributing agency for the allocation of funds from the National Lottery to civil society organisations in the field of social development is appointed; if not, why not; if so, what steps? N1446E

The DEPUTY MINISTER OF TRADE AND INDUSTRY (Dr R H Davies): Chairperson, the distributing agency for charities was appointed on 15 June 2006. By the end of July 2006 the appointments were all accepted and an orientation programme was conducted on 14 August 2006. The distributing agency continued with the work of adjudicating applications from 18 August 2006. Thank you.

Mr D A A OLIFANT: Thank you, hon Chairperson. Comrade Deputy Minister, there has been ongoing speculation in the papers that money distributed from the National Lottery Fund is not forthcoming to the people that most need it. Do you believe that this agency, that has been appointed, is adequate to ensure that the money is forthcoming and on time to get to these people that need it the most? Thank you very much.

The DEPUTY MINISTER OF TRADE AND INDUSTRY (Dr R H Davies): I think that the Act requires that fit and proper people are appointed, and these should be people with knowledge of charities and social development issues in this particular case. I think there is, without doubt, room for improvement in terms of the general efficiency of allocating funds, but I do think that quite often the media reports are quite exaggerated in that there is a significant distribution of funds that has taken place.

It is not this particular block of funds for charities that is the problem. There are some particular rules that govern some other parts of the Lottery Fund. I think the funds that are available for charitable work generally do get out. There is a bit of a debate as to whether community-based organisations, without all the formal requirements, have an adequate crack at this. That is a matter of debate and would require changes in the legislation if we were to open up further in this direction. Thank you.

Ms H WEBER: Chair, I would just like to find out if anything has been done with regard to distributing funds to the NGOs that have not gotten funding for the past five months, and I would also like to know what interest is accrued to the monies which are not distributed.

The DEPUTY MINISTER OF TRADE AND INDUSTRY (Dr R H Davies): I think the decisions about allocating funds are left to independent distributing agencies, and it is up to those distribution agencies to decide whether any particular NGO or applicant would receive the funds. If there have been backlogs and delays in the process, well, I am sure that the new distribution agency would be willing to act as expeditiously as possible to try to speed up processes, and we would certainly want to encourage them in that regard. Thank you.

Mr L B LABUSCHAGNE: Thank you, Minister. The Romans kept the populace happy with bread and circuses. Unfortunately, we had a Lotto circus with very little bread recently. The Lotto is of tremendous interest to hundreds of thousands of South Africans, both players and beneficiaries, and the recent debacle of not having distribution agencies in place timeously - not with a three, four or five-month gap - caused great hardship to many charitable organisations and the needy.

Minister, I recently introduced a private member’s Bill, amending certain sections of the Lotteries Act. I don’t know whether you have seen it, but it provides for the tightening up of timeframes, increasing the capacity of distributors, and ensuring that there is no gap between the appointment of one distributor and the assumption of office the successor. Minister, are you prepared to give these amendments your favourable consideration?

The DEPUTY MINISTER OF TRADE AND INDUSTRY: I am sure the hon member knows the process of private members’ Bills. They are referred to a committee and the department concerned is asked to comment on them. I am sure that process will be followed and if there is merit in the proposals, I am sure we will entertain them.

Cost of flood damage and ground movement to the N2 in the Southern Cape

1. Ms N C Nkabinde (UDM) asked the Minister of Transport:

   What (a) is the estimated cost of the flood damage and subsequent ground movement to the N2 in the southern Cape and (b) are his department and the responsible agency’s strategies in dealing with this matter? N1435E

The MINISTER OF TRANSPORT: Chairperson, the answer, firstly, to part (a) is: the SA National Roads Agency Limited, Sanral, has estimated the cost of the flood damage and subsequent ground movement to the N2 in the Southern Cape to be between R60 million and R80 million, as some of the failures are still under investigation.

The answer to part (b) is: It is the intention of Sanral to repair the N2 by stabilising the failed embankments, and to construct a half viaduct near the Dolphin Point. This viaduct investigation and design is almost complete and will be put out to tender by the end of this month, October 2006. Sanral foresees the construction period to be between eight and 10 months.

The N2 was opened to two-way traffic on 10 October this year. As part of the stabilisation process and repair and replacement work, the road will be closed from time to time. Road users will be timeously informed of these road closures via the media.

Ms N C NKABINDE: Thank you, Chairperson. Thank you, Minister, for the answer. Would the Minister indicate whether the estimate that he alluded to includes the long-term socioeconomic costs, or is it just a short-term solution? Thank you.

The MINISTER OF TRANSPORT: As I said, these are still the preliminary investigation estimates. So when the composite investigations are complete, we will know the enormity of the problems that we have to confront. However, in terms of dealing specifically with the damage that was caused, the estimate is between R60 million and R80 million. Mr S B FARROW: Thank you, Chair. First off, I would just like to congratulate the efforts of Sanral. I have been to that site a number of times and have seen the efforts that have gone into that site. Obviously, it’s using up their own budget, Minister. In this House, during August, we called for a national disaster to be declared as a result of the devastating impact not only of the closure of the N2 but also of the floods on that area and the surrounding towns.

The resulting agreement was that the Western Cape province was actually going to make the necessary application but on a district basis to formalise that process. Could the Minister inform the House what the status of this application is and in particular share with the House knowledge he might have in terms of the funds flowing into the Eden district – that is the people facilitating that - for the specific purpose of paying the bills that have been incurred for the emergency roadworks that have been undertaken in order to reopen that pass. Also, are there are any plans to ensure that alternative roads are being planned around this route in the foreseeable future? Thank you.

The MINISTER OF TRANSPORT: Well, other than what Sanral is dealing with, I wouldn’t know what the status of that application is. That will be within the purview of the Minister for Provincial and Local Government.

Mr S A MSHUDULU: Minister, arising from your response, my question is whether, after your investigations, you will then align your plan with the Disaster Management Act to prevent or reduce the risk of future disasters - to mitigate against the severity or consequences of future disasters - in terms of road infrastructure, or emergency preparedness in these instances, or rapid and effective responses to future disasters of this nature, or postdisaster recovery and rehabilitation?

The MINISTER OF TRANSPORT: Part of the problem of disaster management is that disasters are very unpredictable most of the time. However, Sanral has put in place an emergency response mechanism in order to deal with these issues. I am also aware that in provinces and especially in local government, there are institutional arrangements that are in place to deal with disaster management issues. So, to answer your question directly, there is an effort by Sanral to ensure whenever emergency situations arise out of disasters that those mechanisms are activated.

Tax incentives for the promotion of research among private institutions and their impact

1. Mr V C Gore (ID) asked the Minister of Finance:

   (a) What tax incentives exist for the promotion of research amongst private institutions and (b) what is the envisaged impact that these tax incentives will have on the levels of research amongst such private institutions? N678E

The MINISTER OF FINANCE: Thank you very much, Chair, and thank you, hon Gore, for the question. Of course in the Budget this year we announced incentives for research and development. The incentives consist of an increase in the deduction for tax purposes of research and development expenditure, including salaries from 100% to 150%, and an increase in the depreciation allowances for capital expenditure from the normal 40-20-20-20 to 50-30-20. So, it is accelerated depreciation for tax purposes.

The key issue with R&D is to try to define and revisit the definition so that there is certainty for the investor. When one looks at the challenge in a number of jurisdictions, there is an attempt to facilitate the attraction of people involved in research into companies but also some measure of national benefit.

So, it is a very hard thing because you don’t want to vest people employed in the SA Revenue Service with such discretion that oversight is thereby minimised. But now that we have it in the tax code, it is going to be important that we are able to evaluate it from time to time and ensure that we are marching in step.

The Department of Science and Technology has articulated a set of views. Earlier questions related to Finland and whether the department can advance its interests through Finland. I think that here, through amendments to the tax code for R&D, we are in fact on much safer ground to be able to attract new investment into research and development. Thank you, Chair.

Mr V C GORE: Thank you, hon Chair, and thank you, hon Minister, for the very informative answer and for the initiative. I think it is critically important that more money is put into research and development in this country and not only to increase money coming into this country, but also, as you quite correctly say, for social gain as well.

South Africa has a proud history of developing products and services as a result of research and development for the local market and for the export market. We think particularly of the Kreepy Krauly, the dolosse and open- heart surgery.

One of the concerns that I have, despite this very good initiative which must be welcomed, is how we protect our own intellectual property in this country. We don’t want the research to be developed here at the cost of South African taxpayers, to then become intellectual property to be exported and then the products of that intellectual property to be reimported into this country at a premium. How can we get around that, hon Minister?

The MINISTER OF FINANCE: Chairperson, it is more of a line-function question. Amongst the difficulties is the fact that so many of the South African inventions now find much wider usage. You mentioned the dolosse being one. The other is, of course, the technology used for heavy haulage in rail. It is an entirely South African invention.

There has been no intellectual property protection granted and, in fact, in both of those instances – Minister of Transport - it was the old Railways and Harbours that spent the money on developing the product. It is lost; it’s gone.

The Ministry of Science and Technology placed before us a research and development strategy, which is exceedingly important. Amongst the proposals within the strategy is the fact that where there is public investment into some design, some R&D, then there should in fact be some recoupment of what has gone in by ensuring that the vesting of intellectual property rights include that of South Africa as a whole.

Now, this applies very strongly to research undertaken in universities, as it does in many of the science parks attached to universities. However, I think, the other area where we increasingly need to find some resonance for this is in the indigenous base of our knowledge. We know how large pharmaceutical companies have run off with indigenous knowledge. So, we have got to bring all of these together.

I think between the Department of Science and Technology and the Department of Trade and Industry we have got to continue to lean on them, but from a tax perspective I want to assure the hon Gore and this House that the incentives are in place. We hope that we will be able to measure progress in research and development, because we have to bridge that limit. It might be unofficial for now, but the 1% of GDP spent on research and development is the measure that we should seek to perform against. Thank you, Chair.

Mr N M NENE: Thank you, Chairperson, and thank you, Minister, for your response and the matter has been canvassed especially on the issue of skills. As a follow-up, in a country plagued by a chronic lack of appropriate skills, to what extent are these initiatives going to benefit the previously disadvantaged in creating opportunities for developing skills in support of the Joint Initiative for Priority Skills Acquisition? And, what monitoring mechanisms have been put in place to ensure that these initiatives are not abused for market research, as this would only benefit individual companies instead of the broader economy and the country at large? Thank you.

The MINISTER OF FINANCE: Chair, I am going to sound like a bit of a philistine when I make this point. Part of what we need to understand is that growth and opportunity will arise from our ability to let go as well. The ability to attract engineers and hard technical skills can actually make a difference. This is because part of what we need to understand as a country is that by having the investment, by frequently using South African surroundings, the needs that obtain in this country, the resources that are available, by adding value to them, we will in fact be creating further opportunities.

If we think that South Africa is going to be a country that is entirely dependent on muscle work, we will be left behind in the global need for increased competition. I don’t think that these are binary choices. We must be able to advance, and I think part of the advance is the ability to take forward from the base we have.

If you look at skills shortages now, the skills shortages in areas like information technology are indeed profound. There are a million job opportunities begging in South Africa, there are 4 million unemployed people - a complete mismatch.

Now, if you only focus on the 4 million, believing that it has to be in the areas of digging trenches, I think we are going to make serious mistakes, hon Nene. We must be big and bold and far-sighted enough to understand how these things come together. It is by having the technology and the technologists that you will create new industrial opportunities. Thank you. Mr I O DAVIDSON: Thank you, Mr Chairman. Mr Chairman, the Minister referred in an earlier reply to the benchmark of 1% in terms of investment in R&D as a national strategy. Could he just let us know how far we are as far as that is concerned? I think the year is 2008, in which we are supposed to have achieved that. There was also a figure mentioned in that national strategy of 2% of GDP, but a date was left unsaid. Is there now a date attached to that? What is the target date? Thank you.

The MINISTER OF FINANCE: Chairperson, I actually think that the Deputy Minister of Science and Technology is better able to deal with it, because it not just a measure of government. Clearly, we’d measure what the science councils are doing, but you have to factor in what the private sector is doing as well and there is the total GDP. Perhaps, with your permission, I could ask Deputy Minister Hanekom if he has the number and to just share it with us.

The DEPUTY MINISTER OF SCIENCE AND TECHNOLOGY: I’m next anyway.

The MINISTER OF FINANCE: You’re doing it next.

The ACTING SPEAKER (Mr G Q M Doidge): It is coming up later on the Question Paper.

The MINISTER OF FINANCE: Thank you very much, Chair.

Dr R RABINOWITZ: Thank you, Chair. Hon Minister, I am sure you are aware of the programme that is being developed at RAU for the development of thin film solar technology - a partnership between government, the Johannesburg University and businesses in South Africa. That technology was developed here and yet it is being produced by companies in Germany. The claim is that it is done in this way because there are so many more incentives for the production of a new technology in Germany.

You mention that you have put incentives in place. Will these equate with what is offered in Germany and would this now negate the argument that it is better to produce the technology in Germany? Also, generally, you spoke about putting your head together with Science and Technology, so are you also considering putting your head together with the hon Minister of Minerals and Energy to promote the development of renewables in some way? Thank you.

The MINISTER OF FINANCE: Chair, I am not quite sure how far the questions are going to deviate from the question on the Question Paper. The question on the Question Paper was about tax and incentivising research and development. Now, we can spend time and talk about these issues. I know the Deputy Minister there. If the Minister were here he would be able to confirm this - and it is not RAU, but the University of Johannesburg.

He would be able to confirm that since you last read that in a newspaper, there has been phenomenal development, and that there has been significant change. However, I will let him do that in subsequent questions.

On renewables, there is an ongoing battle. Part of our problem is, of course, that we have a remarkable source of low-cost energy. Now, I don’t think, again, that we must choose to put in wind generators when we should be investing a bit more to ensure that when it comes to the hydrocarbon we get - the black stuff that we dig up and that we heat to produce energy - we should in fact be scrubbing the outlets to ensure that we can deal with emissions.

You don’t have to walk away from coal energy. It has been a remarkable success story. Pithead generation capacity has been a remarkable success story and has driven our industrialisation in South Africa. Let’s not abandon it.

We can, in fact, do a lot more to get clean energy from coal, and it is the kind of technology that I think will provide the breakthroughs for us as a country. At the same time, there is a wind farm in Darling. I am sure you only have to look from De Waal Drive to see the potential for wave action technologies here as well.

It is bringing all of this together and, in fact, the very example you mentioned of thin fibre solar technology. However, all of those technologies remain considerably more expensive than our low-cost coal- driven thermal energy. Thank you, Chair.

The ACTING SPEAKER (Mr G Q M Doidge): Thank you, hon Minister, for assisting with that response. Hon Deputy Minister, can we give you a minute to respond to these issues if you wish before we carry on to the question that is coming your way?

The DEPUTY MINISTER OF SCIENCE AND TECHNOLOGY: Thank you, Chairperson. My reply to the question is quite a short one, so I thought my time would permit it anyway. I have to reveal a very confidential matter to this House, which is that the Minister of Science and Technology is seriously considering appointing the Minister of Finance as his spokesperson on research and development and science matters in general. [Laughter.] I think he is well qualified to do that. The truth is that the Minister of Finance is expected to know everything about everything.

On the percentages of GDP spent on research and development, at the moment with the last survey, it is standing at 0,87%. It is steadily rising, and the target is to bring it to 1% of GDP by 2008.

We are moving in that direction, but the hon Minister of Finance is absolutely right. This is not just public spending on research; it’s a combination of public spending and private-sector spending. The challenge is not just how much you spend but the quality of that spending.

So, a lot has to do with the institutional framework, which allows for targeted research, good quality research, relevant research, etc, obviously not negating the value of basic fundamental research if you like and the freedom of that research, which mainly is funded by the Department of Education. So, the National Research Foundation funds applications for research projects, targeted research if you like, but generally research is the responsibility of the Department of Education.

On the energy question very briefly, of course the attempt to get cleaner coal-generated electricity is very important, but at the same time we should say that R40 million has been allocated to the SA National Energy Research Institute which will be looking at these clean and renewable energy options, which are very important. I would like to say that yes, it probably is right that we have underspent in this area. We haven’t allocated sufficient resources to properly explore and exploit the potential of cleaner and renewable sources of energy.

The reply to the question, very briefly is that the Africa Institute of SA, Aisa, is one of the science, engineering and technology institutions operating within the national system of innovation and reports to the Department of Science and Technology. That is the way it is at the moment.

The mission of the institution, derived from the shareholder compact that it recently entered into with the Minister of Science and Technology, is aligned with the vision and mission of the Department of Science and Technology.

The Africa Institute of SA is currently involved with broad-based social science research, forging linkages with other government departments, for example, and primarily with Foreign Affairs.

The location of Aisa and future positioning is quite complex and requires discussion and debate with various stakeholders. Such discussions have been initiated and are continuing. Thank you.

Ms K R MAGAU: Thank you, Chairperson. I would like to thank the Deputy Minister for the answer. I am fully covered and I have no follow-up question. Thank you.

                Land Claims Commission uncertainties

1. Mr M V Ngema (Nadeco) asked the Minister for Agriculture and Land Affairs:

   (1) Whether any mechanisms have been put in place to deal with the exodus of staff from the Land Claims Commission because of the employment uncertainties pertaining to the life span of the commission; if not, why not; if so, what mechanisms;

   (2) whether any capacity-building mechanisms have been put in place to capacitate the commission to complete all its tasks by 2008; if not, why not; if so, what are the relevant details? N1520E

The MINISTER FOR AGRICULTURE AND LAND AFFAIRS: Chairperson, yes the commission staff have the same skills that are required for the implementation of other land reform programmes. Therefore, there has been an agreement between the Land Claims Commission and the Department of Land Affairs to ensure that staff of the commission will be absorbed into the Department of Land Affairs in order to implement other land reform programmes after the 2008 restitution programme has been completed.

There is also a retention strategy that has been agreed to and this, amongst other things, has ensured that we look at the existing vacancies. We also look at the conditions of service of current members of staff. We have effectively replaced most of the vacancies, including senior positions such as those of Land Claims Commissioners for KwaZulu-Natal, Gauteng and the North West province.

Secondly, all commission staff have been trained in all the various stages in the settlement of a claim and are, therefore, in a position to speed up the resolution of outstanding claims.

We have also developed a staff retention strategy that has ensured that we will have the required capacity to resolve the remaining outstanding land claims. Thank you.

Mr M V NGEMA: Thank you, Chairperson. Thank you, Minister, for your comprehensive answer. I must say that as Nadeco we are very concerned and hope very much that this programme succeeds because its success is part and parcel of our overall poverty alleviation programme.

Minister, in your response you covered and pre-empted my follow-up question, and I need to be honest and not waste the Chairperson’s time. Thank you.

Mr A H NEL: Thank you, Chair. I will ask my follow-up question to the Minister, and not to Mr Abram. Minister, you know about the frustration of both the claimants and the landowners, because of the changing of the officials that they work with. One of the big problems is uncertainty, and because of it, it is always the best people who go first.

It is also known that both the agricultural unions have said that they are willing to help with the administrative work. My question then is: Why don’t you accept their offer? Furthermore, why don’t you outsource some of the work to NGOs and companies that are able to do this work? Thank you.

The MINISTER FOR AGRICULTURE AND LAND AFFAIRS: Chairperson, as I have indicated already, firstly, we do have a strategy in place and it is working, because some of the senior officials that have resigned have actually written to withdraw their resignations.

Secondly, yes, offers have been made. However, we have taken pains to train staff to ensure that they are able to implement the restitution process according to the restitution Act. Therefore, in order to ensure that we do not cause confusion, we will not be in a position to adopt anyone who is volunteering, because it takes time to train such officials.

I believe that at this point in time we have not had problems that have led to delays. Delays have actually arisen as a result of endless negotiations around prices - inflated land prices. As we move forward, we believe that our personnel and staff are equal to the challenge and the task ahead. Thank you very much.

See also QUESTIONS AND REPLIES.

                          NOTICE OF MOTION

Ms H WEBER: Chair, I hereby give notice that I will introduce the following motion:

That the House-

 1) requests that the Department of Justice and Constitutional,
    Development, as the core department piloting the Equality Review,
    should attend all public hearings on the Promotion of Equality and
    Prevention of Unfair Discrimination Act; and

 2) expresses concern at the absence of the department when public
    hearings were held for people with disabilities, the most vulnerable
    and marginalised group in South Africa.

                  CELEBRATIONS OF DEEPAVALI AND EID

                         (Draft Resolution)

Ms S RAJBALLY: Chairperson, I move without notice:

That the House-

 1) notes that-

      a) it is the Hindu festival of lights, Deepavali, this Saturday
         and the Muslim celebration of Eid on Monday or Tuesday after
         fasting for the month of Ramadan; and


      b) the celebration of Deepavali and Eid is a further affirmation
         of our enduring faith in God, in ourselves, in our community
         and in our country;


2) recalls that both Hindus and Muslims around the world are afflicted
   by poverty, starvation and war;

3) conveys its prayers and good wishes for a Happy Deepavali and an Eid
   Mubarak; and

4) wishes that the day may be filled with joy, love, family and
   festivity.

Motion agreed to.

The House adjourned at 17:05. ____

            ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS

ANNOUNCEMENTS

National Assembly and National Council of Provinces

1. Translation of Bills submitted

 (1)    The Minister of Safety and Security


      a) Wysigingswetsontwerp op Beheer van Vuurwapens [W 12 – 2006]
         (National Assembly – sec 75)


         This is the official translation into Afrikaans of the
         Firearms Control Amendment Bill [B 12 – 2006] (National
         Assembly – sec 75).

TABLINGS

National Assembly and National Council of Provinces

1. The Speaker and the Chairperson

 a) Report of the Auditor-General on the findings identified during an
    investigation into procurement at the Companies and Intellectual
    Property Registration Office (CIPRO) – September 2006 [RP 245-
    2006].

COMMITTEE REPORTS National Assembly

1. Report of the Portfolio Committee on Trade and Industry on the Accreditation for Conformity Assessment, Calibration and Good Laboratory Practice Bill [B 29- 2006] (National Assembly – Section 75), dated 18 October 2006:

   The Portfolio Committee on Trade and Industry, having considered the subject of the Accreditation for Conformity Assessment, Calibration and Good Laboratory Practice Bill [B 29- 2006] (National Assembly – sec 75), referred to it and classified by the Joint Tagging Mechanism as a section 75 Bill, reports the Bill with amendments [B 29A – 2006].

2. Report of the Portfolio Committee on Trade and Industry on the Measurement Units and Measurement Standards Bill [B 21- 2006] (National Assembly – Section 75), dated 18 October 2006:

   The Portfolio Committee on Trade and Industry, having considered the subject of the Measurement Units and Measurement Standards Bill [B 21- 2006] (National Assembly – sec 75), referred to it and classified by the Joint Tagging Mechanism as a section 75 Bill, reports the Bill with amendments [B 21A – 2006].

3. Report of the Portfolio Committee on Public Service and Administration on the Application for the Extension of the Contract of Employment for Mr Abdul Samad Minty: Department of Foreign Affairs, dated 18 October 2006:

THE REPORT

The Portfolio Committee, having considered the application by the Department of Foreign Affairs, to extend the employment contract of Mr Minty by five years, report as follows:

THE APPLICATION AND REFERRAL TO THE COMMITTEE

The Department of Foreign Affairs made an application for Parliament to approve the extension of contract of employment in respect of Mr Minty and for the period of five years, reckoned from the 1st of November 2006, in terms of Section 16(7) of the Public Service Act, 1994.

The application was referred to the Portfolio Committee on Public Service and Administration as per the ATC of 11 September 2006.

BACKGROUND INFORMATION ON Mr MINTY AND THE RESPONSIBILITIES

Disarmament, Nuclear and Arms Control Issues: Has extensive experience in this field since the early 1960’s when he was involved in working on ending external military and nuclear collaboration with the apartheid regime. At that time he worked through the Anti- Apartheid Movement as well as the United Nations and its various committees as well as the OAU and the Commonwealth.

Recognised for authoritative and well researched exposition of issues and prepared numerous documents for various conferences and inter-governmental meetings on the military and nuclear capacity of the apartheid regime and international collaboration with it.

After the imposition of the UNSCouncil’s voluntary arms embargo against SA and the establishment of a special committee of the UNSC to oversee it he was invited on numerous occasions between 1977 and 1994 to give evidence to that committee, usually in closed sessions, on the operation of the embargo and especially on alleged violations. He served as Director of the World Campaign against Military and Nuclear Collaboration with South Africa, (established at the suggestion in 1977 of the UN and the OAU) until 1994.

After the democratic transformation of South Africa he was asked by the DFA to join several delegations as Adviser, including the IAEA General Conference in 1994.

In August 1995 he was appointed DDG for the Multilateral Branch in the DFA until June 2004. He continued to serve as DDG with special responsibilities for Disarmament issues and also as the President’s Personal Representative on the Nepad Steering Committee.

Earlier, in June 1995 he was appointed as Chairperson of the South African Council for the Non-Proliferation of Weapons of Mass Destruction and has continued to serve in that capacity ever since, having been re-appointed each time by respective Ministers of Trade and Industry.

In 1995, when South Africa resumed its seat on the Board of Governors of the IAEA, Mr Minty was appointed as the Governor for South Africa. South Africa retains the one seat on the Board that is allocated permanently for the African country that is the most advanced in terms of its “nuclear” facilities and capability. In this capacity he participates in quarterly meetings of the Board as well as in other meetings related to the work of the Agency.

At the last meeting of the IAEA General Conference in September 2006, Mr Minty was elected President of the Conference on behalf of Africa whose turn it was to preside over the annual conference.

In addition to the IAEA Mr Minty also supervises, and where possible, participates in meetings of the Nuclear Suppliers Group (NSG) and the Missile Technology Control Regime (MTCR) as well as other bodies such as the Conference on Disarmament (CD), the Comprehensive Nuclear Test Ban Treaty Organisation (CTBTO) and the Chemical and Biological Weapons institutions as well as the Wassenaar Arrangement that deals with conventional weapons.

With regard to the National Conventional Arms Control Committee (NCACC) Mr Minty represents the DFA on both the NCACC as well as its Scrutiny Committee. He also supervises the processing of import and export permits on behalf of the Department.

Following the September 11 events issues related to Terrorism and Weapons of Mass Destruction have taken on new importance with a series of new initiatives taken by some of the major powers. At the same time the issue of Iran’s use of nuclear technology for peaceful purposes has been the subject of a long dispute within the IAEA and recently in the UNSC.

Under special resolutions adopted by the UNSC on the subject of Terrorism as well as Resolution 1540 on Weapons of Mass Destruction member states are required to present regular reports to the UNSC on the various measures taken by them. These reports are processed thoroughly by Mr Minty who also follows trends and developments in this field.

While the Nuclear Weapon States (NWS) are not interested in implementing their commitments to disarm, as stated in the NPT, they are increasing the encroachment on the rights of non-nuclear weapon states under the guise of non-proliferation. At the same time the US has declared that it intends to develop new nuclear weapons, not so much for deterrence but actual use including to counter terrorism as well as serious biological or chemical threats … It is the general intransigence of the NWS that also led to the total failure of the five year 2005 NPT conference. Early next year the international community will begin the process of holding several preparatory meetings in advance of the 2010 NPT Review Conference and this process will be a critical one for developing countries to protect their rights under the Treaty.

At the same time there are a series of measures being proposed by the US and other powers to restrict the rights of members of the NPT to use nuclear technology for peaceful purposes and in particular to prevent countries who do not enrich uranium already from doing so in future. South Africa has been active in opposing these measures and has defended the rights of NPT members, especially developing countries, to protect and retain rights that are enshrined in international treaties and agreements. These debates are highly controversial and extremely sensitive and have serious implications for countries such as South Africa which is also being pressed to pledge in advance that it will never enrich uranium for nuclear energy. To do so would make the country dependent on other countries in a key area of strategic national interest and it is therefore of critical importance to participate in all such discussions, equipped with the necessary technical expertise and experience. In several such discussions South Africa has played a major role and conveyed the case of developing countries.

In most of these discussions and debates institutional memory and direct experience is of considerable importance. However, it is in the actual negotiations over particular issues, including matters which involve minute detail that such experience, knowledge and vigilance are of critical importance. In the present international environment there is no issue in this field that can be said to be only a technical one – they are all fraught with danger for developing countries and of supreme political importance. Thus, these negotiations involve technical and political issues and the pressure of the big powers, united in purpose, is almost overwhelming for most developing and even some developed countries

In this context, South Africa has been able to stand on principle and defend its position on the basis of international law and specific treaties and agreements. Despite the fact that South Africa’s position is often not welcomed by the big powers this is the main reason why it is respected and held in high esteem. Thus the role of South Africa is unique. In order to deal with these issues it is also important to follow global trends and developments and Mr Minty has a long and keen interest in these matters. He is therefore able to assist the Department in other areas as well. With the impending membership of the UNSC for two years the experience and knowledge of Mr Minty in relation to the UN and some of the major issues before it will be invaluable.

For reasons of coherence, co-ordination and strategic policy implementation it was decided last month that Mr Minty will serve as Ambassador and Special Representative for Disarmament and Nepad.

FURTHER MOTIVATIONS

The Department of Foreign Affairs made several plans to address the succession of Mr Minty, but due to the nature of work and the required combination of competencies associated with the relevant environment and conditions of work, they are not in a position today to can say that they have a suitable candidate to replace him, and possibly not in the next two years. They have, however, placed some officials to the understudy programme as an attempt to address this matter and, assuming that all other things will remain the same, they see themselves being able to achieve their succession goals within the required period of extension, hence this application.

OBSERVATION

From the aforesaid, the Committee accepts that the situation under which the Department find itself in this case is extra-ordinary and should be considered as such without setting precedence.

In considering this application favourably, we should build into the approval a mechanism to monitor and manage the development of a succession plan to deal with this matter.

RECOMMENDATION

That Parliament passes a resolution to approve the extension of the employment contract of Mr Minty for the period of five years, reckoned from the 1st of November 2006, in terms of Section 16(7) of the Public Service Act, 1994.

That the following conditions be attached to the approval.

▪ The Department of  Foreign  Affairs  develops  a  coherent  succession
  strategy/plan and present it to the  Portfolio  Committee  on  Foreign
  Affairs, within a period of six months, calculated from  the  date  of
  approval of this application by Parliament.
▪  The  Department  include  the  implementation   of   the   succession
  strategy/plan in their strategic plans.
▪ The Department of Foreign Affairs report annually on progress  in  the
  implementation of the succession strategy/plan.

Report to be considered.