WEDNESDAY, 14 MARCH 2007 __

                PROCEEDINGS OF THE NATIONAL ASSEMBLY
                                ____

The House met at 15:04.

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

ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS – see col 000.

QUESTIONS FOR ORAL REPLY

                              ECONOMICS


                              Cluster 3

MINISTERS:

The SPEAKER: Order! Regarding Question 114, which has been posed by the hon Cupido, the Minister of Minerals and Energy, regrettably, is not available to answer questions today, and it was agreed to by the member that the question stands over.

       Electricity supply to company at Coega industrial port 113.  Mr L W Greyling (ID) asked the Minister for Public
    Enterprises:(Interdepartmental transfer)


    (a) What are the details of the contract concluded with a certain
    company (name furnished) that is to be located at the Coega
    industrial port, (b) at what cost has the electricity per unit been
    determined for the company and (c)(i) where will the electricity be
    generated from and (ii) how will this affect the current challenges
    related to energy supply?  N463E

The MINISTER FOR PUBLIC ENTERPRISES: Madam Speaker, this question, in fact, relates to the international company, Alcan. The rate that was agreed to with this customer was based on the principles which have been set out on the DTI’s Developmental Electricity Pricing Programme. This rate is determined and based on a globally competitive price for electricity, but with the proviso that the customer should not be subsidised by other customers and that the customer himself should not subsidise other customers as far as is possible.

The contract also includes an annual real price escalation in line with Eskom’s projected forward price curve. The agreement and rates have been approved by the National Energy Regulator of SA, Nersa.

The actual rate is a commercial contract which will not be disclosed in this House, other than that it is guided by the principles that I have indicated, which would apply to any potential customer on the same basis. Those of you who are familiar with the pricing system will know that any customer who would use more than 50 megawatts in a year is eligible for the Developmental Electricity Pricing Programme. There are no specific stations that we can identify. The supplier will be from the national grid.

Finally, the project will not affect the current supply conditions in that area, the Nelson Mandela Metropole.

The project will have a demand of approximately 1 355 megawatts after the commissioning of both potlines. The potlines will be built in two phases; a full capacity of 675 megawatts for the first potline will be required in 2011, and a full capacity for the second potline of 680 megawatts will be required in 2014. I must say we are very pleased with this contract, and it shows that South Africa remains highly competitive in the international energy sector.

Mr C H F GREYLING: Thank you, Madam Speaker. Thank you, hon Minister, for your reply. I am still trying to put together a few pieces, and obviously it’s a bit difficult without knowing exactly what the price is that they will be charged. What I do want to say, though, is that aluminium has often been described as simply electrified energy in that it is so energy intensive. Also, as you have indicated by your response, it is going to require about 1 500 megawatts. In response to a question to the Minister of Minerals and Energy in 2005, it was stated that iGas, Eskom and Shell were investigating the feasibility of using imported liquid natural gas, or LNG. Is that still an option, or will we be getting that from normal coal-fired power stations? If we are getting this from liquefied natural gas, I would imagine that that would make the energy costs a lot higher; in which case, who is going to be subsidising the extra cost that goes to Alcan?

If we are not getting it from liquefied natural gas, we will be getting it from coal-fired power stations, which will substantially increase our greenhouse gas emissions. What statement would the Minister like to make in terms of reducing those greenhouse gas emissions? Thank you.

The MINISTER FOR PUBLIC ENTERPRISES: I would like to say don’t worry about putting the pieces together; I will give you the information. The developmental pricing system will look at the projection of what is not strictly an economic term but at an approximation that is called the average price. This looks at the average price of generation from a whole range of different generating sources, Eskom’s existing portfolio and our projected portfolio.

We do this because the charge at the marginal price, if you are familiar with those issues, would be very high indeed. That answers one part of your question. We would not charge at marginal prices. This would have an impact on the economy of charging very high prices for any new investment, and I don’t think that’s wise. We should benefit from our past investment - it’s one of our great strengths - and we should price that forward.

The average price will continue to rise and quite markedly, I am afraid, because of the new Bill. It is an average price curve. So as the new Bill comes in, if we do utilise the opportunity for LNG in Ngqurha, we will do so. That particular price of that system, be it within Eskom or be it within an independent power producer, will have the effect of raising the average price, which is our benchmark price for this contract.

I am sorry about being a bit complex, but really it is very important for this matter to be well understood. I think it is one of our great strengths in South Africa in that we can plan well in advance - into the future. In fact, our ability to sign a contract for 25 years is quite rare in the world today. Therefore, we will not subsidise this particular project no matter what we are putting into that area, be it LNG, be it a pebble bed, or be it a pressurised water reactor. Whatever it might be that we put there eventually, yes, the LNG projects are being considered. But I think it is a very stable pricing system, and what I want to stress as very important is that any project of 50-plus megawatts utilisation can qualify for the developmental pricing initiative.

The processes are quite rigorous; they have to demonstrate that they have knock-on effects. I think we’ve developed a quite interesting and unique pricing system for our projects, and it would be very unwise for South Africa not to utilise its strength and energy. We are one of the low-cost producers and we will remain, fortunately, into the future, one of the low- cost producers in the world.

Adv H C SCHMIDT: Madam Speaker, an IPP, or independent power producer, such as those recently reported in the media concerning the Ngqurha industrial zone, will clearly have the ability to provide considerable base load capacity, such as the reported approximate 1 600 megawatts of a closed cycle gas turbine which has been considered for the aluminium smelter still to be built.

Would the Minister support the notion of IPPs being independent power producers such as the IPSA, being solely responsible for the provisioning of electricity for, inter alia, industrial zones such as Ngqurha and other instances in which Eskom, the responsible parastatal for electricity, plays a secondary and, in some instances, no role in the provisioning of electricity? I am referring particularly to the government’s policy on the 70-30 split: 70% by Eskom and 30% by IPPs. Thank you.

The MINISTER FOR PUBLIC ENTERPRISES: Unfortunately, the member’s question shows quite a profound misunderstanding of how the system works. I would like to explain it because, as I have just explained to the hon member, this is one of our great strengths. The system works as a total system. An independent power producer, as the chairperson of Eskom outlined to Parliament, will sell the electricity. In order to facilitate the IPPs, they will sell their electricity to Eskom through what is called a power-purchasing agreement. One of the issues that we are currently debating is how we share the risk of a power-purchasing agreement. Whose responsibility is it to pay or provide the electricity, because the PPA is a take-or-pay agreement whose responsibility is it to pay if that IPP doesn’t produce for commercial or other risk factors?

Your question is misplaced. We would never - it makes no sense for the very reasons I have argued in the earlier answer, and it would be very silly indeed - put an IPP into Ngqurha and then supply the users in Ngqurha at that price, because that price is very high. So we price this at the average price: average for those of you who are good economists - which I am sure this whole House is - although this is a slight misuse of the word. Douglas Gibson says he is an economist, so Christmas must be in September. [Laughter.]

We are quite comfortable. The Department of Minerals and Energy has considered the possibility of an IPP into Ngqurha, so what will happen then is it will supply into the total grid. It will not just be for that. By and large, an LNG gas-fired station will be a very high cost for base load capacity. So, generally, we will not consider LNG for base load at this point. For us, coal - and as we have recently announced - pressurised water reactors or pebble bed reactors would have a better base load capacity.

I hope I have clarified this. I think it is an interesting possibility. We would love the private sector to come in, as we have indicated, for 30% of the generation, but they will do so within the economic and regulatory model I have just very briefly described.

Mr S E KHOLWANE: Thank you, Madam Speaker. Hon Minister, I want to start by expressing appreciation that you educated the House in terms of how the national grid works. The question I particularly want to ask you is: Are there any projects which have been embarked upon by Eskom around that particular part of the country, in relation to the generation of electricity? Secondly, what is it that Eskom is doing in terms of ensuring that we are strengthening our national grid because, I think, that is where the problem is?

We must strengthen our national grid so that we are able to have enough capacity to supply electricity. Thank you.

The MINISTER FOR PUBLIC ENTERPRISES: Thank you, hon member, and thank you for this chance to further educate the House. As we have indicated very clearly - and this is a national priority - the structure of the South African grid is that the base load sits in the north and demand is growing in the south. As we have also graphically experienced, we have problems whenever Koeberg goes down, because it is the only base load station in the south. As we have indicated, we will attempt to increase the base load capacity in the southern part of the grid.

Currently, we have been putting in two closed cycle gas turbine plants. These are quite expensive forms of generation. This is roughly 1 000 megawatts: one in Mossel Bay and the other in Atlantis. Fortunately, they have both come on stream in the Western Cape and the Eastern Cape before the winter and that, I think, is very important.

The second thing that we will do is light up Danny Oliphant in Atlantis quite shortly… [Laughter.] The second thing that we will do is strengthen the grid. We are one of the few countries in the world that are now building 765-megawatt grids. This is moving closer to the Cape each year. Our target is some time in the middle of next year. That helps. Also, for the Ngqurha project we will put in a 765-megawatt grid. There will be redundancy, so it will come in from both sides and that will allow us to supply Alcan and other projects. And, as the questioner indicated, we must consider a further base load project in the south, and, as we have recently indicated, we will probably consider a conventional nuclear reactor in the south to give us more base load capacity.

The grid, as you know, is very important. It has to be balanced across the whole system and this is why base load is very important. Basically, we do have to put a base load plant somewhere in the Nelson Mandela Metropole area.

Mr H B CUPIDO: Hon Speaker, hon Minister, in light of the high unemployment and the need for urgent development in the Eastern Cape, could the Minister give us the assurance that the contract includes specific conditions or programmes relating to skills development within the context of Agisa?

An HON MEMBER: Asgisa!

Mr H B CUPIDO: Sorry. Asgisa

The MINISTER FOR PUBLIC ENTERPRISES: The conditions of a developmental contract have to be internationally competitive. They must meet the needs of major users of electricity. Basically, this works in the following way because the size of the project is above 50 megawatts, this means it will have a significant impact on the economy of that area. The Department of Trade and Industry attempts to quantify that impact, and that impact will spread knock-on effects and other industries that can be brought in. Skills, directly, are not a specific component, but we are quite confident that this will be a knock-on effect.

Remember that international investment has many places it can go to, so to think that you can set any condition you want in South Africa and still expect one of the world’s biggest aluminium companies to come here is a naive notion.

So, if we want jobs, if we want skills, we really have to have investment in South Africa. In order to do that, we have to have internationally competitive energy pricing, which we have been able to do in this case. But, certainly, between the state-owned enterprises of Transnet, Eskom, Denel and others we are working very actively on developing skills. I think this will be a wonderful opportunity to do so.

By having such a big project at Ngqurha there will be tremendous benefits for that area. I think that this is exceptionally positive for the South African economy. It is really silly to start criticising it when we have conceived of the thing so well. It will create a new area and create a new industrial port. I think this is something we in this House should all back fully.

   Legislation to protect farm workers against evictions and abuse

1. Mr B A Radebe (ANC) asked the Minister for Agriculture and Land Affairs:

   (1) In light of her recent statement regarding the increase in evictions and abuse of farm workers, what measures have been or will be taken to address this matter; (2) whether her department is considering updating existing legislation or introducing new legislation to protect farm workers; if not, why not; if so, (a) what is the status of the process, (b) what are the stumbling blocks and (c) when will the relevant legislation be tabled? N434E

The MINISTER FOR AGRICULTURE AND LAND AFFAIRS: Madam Speaker, the Department of Land Affairs is in the process of establishing a land rights management facility that will, inter alia, provide legal representation to victims of all forms of land rights infringements, establish a comprehensive eviction-monitoring system that will include a call centre with a toll-free number, and provide for a panel of mediators at provincial and district levels.

The answer to part 2(a) of the question is that the department will develop a policy separating the management of evictions from the provision of security of tenure to farm dwellers. With respect to the latter, new legislation will be drafted in order to provide security of tenure to farm dwellers through a redistributive process. It is now considered that existing legislation for land redistribution can be used to provide security of tenure to farm dwellers and farmworkers.

Concerning the management of evictions, the Prevention of Illegal Eviction From and Unlawful Occupation of Land Act of 1998 - that is the PIE

• is in terms of Cabinet’s decision to be transferred from the Department of Housing to the Department of Land Affairs. We therefore believe that the Extension of Security of Tenure Act – Esta - and the Land Reform (Labour Tenants) Act – LTA - of 1996 will be incorporated into the PIE for the purposes of enhancing the management of evictions and creating a universal procedure for dealing with evictions.

Concerning the policy alluded to above, there are no stumbling blocks. However, with regard to the legislative process involving the prevention of illegal eviction Act, the amendment to the PIE driven by the Department of Housing should not be delayed. Assuming that the amendment to the PIE is concluded, including the parliamentary processes and public hearings, the new legislation incorporating provisions of Esta and the LTA for the management of evictions will be included in the 2008-09 legislative programme of the department. I thank you.

Mr B A RADEBE: Comrade Minister, your statement was correct when you stated that there were cases of illegal evictions and abuse on the farms. In my constituency we have people like Reverend Mfuphi, who was shot and killed for trying to hold a night vigil. I have in my constituency a Mr Mokoena, who was shot for refusing to wash the farmer’s car; and Mr Mcirha who was born on a farm and lived there until he was around 65 years old. The farmer tried to refuse his burial on that farm. So the statement you made was correct: there were cases of illegal evictions and abuse on the farms. The challenge now is for Transvaal Agricultural Union and AgriSA to isolate those farmers who are abusing the farmworkers.

We know that South Africa belongs to all who live in it, black and white. We appreciate the initiative taken by the department, of creating the land rights management facility so that we can protect the vulnerable farmworkers. The question now, Minister, is: How far is the establishment of that facility and how widespread is the roll-out going to be? Is it going to be at national, provincial or local level? Thank you. [Applause.]

The MINISTER FOR AGRICULTURE AND LAND AFFAIRS: Thank you, hon Radebe. Indeed, we all know that evictions are rife all over the country and we also know that there are serious human rights abuses on some of our farms. It is hoped that the land rights management facility will be finalised in due course. We will finish the first half this year.

We are also confident that we are going to work together with various farmers’ unions. We have had our talks recently, with AgriSA, the Transvaal Agricultural Union and the National African Farmers’ Union. We have all agreed that together we have the responsibility not just to guard the rights of farmworkers, but also to take responsibility and ensure security and safety in our farming communities, including combating and condemning the killings of farmers in our rural communities. Thank you. The SPEAKER: Order! We now come to Question 76 … Oh, I am only now getting the name of the hon Nel.

Mr C M LOWE: Madam Speaker, I can assure you, the hon Nel did push his button some time ago when the first question was called. Thank you.

The SPEAKER: Did he want to speak during the first question?

Mr C M LOWE: No, Madam Speaker. The hon Nel pressed his button to speak on this question, but when the question was called I did see him. Thank you very much.

Mr A C NEL: Thank you, Speaker. Firstly, I want to ask the Minister if she based her recent statement regarding abuse and rape of farmworkers on the alleged rape of a farmworker in Rawsonville. Secondly, do you, the Human Rights Commission or Mr Radebe know by name any case of illegal evictions from farms? If you do, you are breaking the law by not giving evidence to the police.

What I cannot understand - and maybe the Minister can tell us - is why is a bad apple in the farming community is an agricultural problem that reflects badly on all farmers? But a bad apple in, say, the ANC is a case for the police and the person is not guilty until a court finds him or her guilty? Thank you. [Applause.]

The MINISTER FOR AGRICULTURE AND LAND AFFAIRS: I thought Mr Nel was dealing with the next question.

Firstly, my statement was not a general statement that referred to all farmers. We have highlighted the positive contributions of farmers in various parts of the country. We have also highlighted the efforts of commercial white farmers who have set up joint ventures with emerging black farmers, who have transferred skills to emerging black farmers and assisted them to begin to realise production and income as new or emerging farmers.

However, the fact of the matter is that there are human rights abuses. There are serious human rights abuses on farms and we cannot deny those abuses. Mr Nel, I have definitely answered your questions in writing, asking for statistics on evictions, asking for reports that have been tabled to the department. I have given you written answers to those questions.

I also want to say that we, as the Department of Agriculture, are not going to apologise for what we are doing to protect farmworkers. We are not going to apologise for telling the truth. Thank you. [Applause.]

      Procedural correctness in awarding of new lottery licence

1. Mr L M Green (FD) asked the Minister of Trade and Industry: (1) Why was a certain company (name furnished) ruled out of contention for the new lottery licence;

   (2) whether he was informed of any political office-bearers who have a financial interest in a certain consortium (name furnished) which received the lottery licence; if so, what are the relevant details;

   (3) whether all the provisions stipulated in the Lotteries Act, Act 57 of 1997, were followed when the lottery licence was awarded to the said consortium; if not, why not; if so, what are the relevant details? N331E

The MINISTER OF WATER AFFAIRS AND FORESTRY (on behalf of the Minister of Trade and Industry): Madam Speaker, the response to the first part of the question is as follows. The selection process for the preferred consortium to be the operator for the national lottery involves scoring, using various criteria. Gidani scored higher than the other bidders. It is therefore incorrect to say that Uthingo was ruled out of contention to operate the new lottery licence. They were selected as the second preferred bidder during a process which was regarded as fair and a process that was done with integrity.

The answer to the second part of the question is as follows. As part of the process of evaluating the bidders, the Minister of Trade and Industry was informed in writing that no political office-bearers had a shareholding in Gidani.

Concerning the third part of the same question, the Minister and the National Lottery Board were of the view that all the provisions were followed as required, in terms of the Lotteries Act. Thank you.

Mr L M GREEN: Madam Speaker, I would like to thank the hon Minister for her answer. Minister, I am concerned about the process that has been followed in awarding the licence of the national lottery. The process has revealed the inner wrangling of powerful consortia and politically well-connected individuals. Everyone is striving to have stake in this lucrative business that generates billions of rand every year.

My follow-up question, hon Minister, is: Given the fact that the upkeep of the lottery is largely done by the poor who, with their limited funds, engage in chance practices, hoping with ongoing perseverance to make a quick windfall, resulting in the ongoing cycle of poverty, and given that the Minister of Finance has now strongly promoted a culture of saving amongst all South Africans including the poor, would it not be an opportune time for the Minister to reflect on the great good it would do our nation in terminating the national lottery? I thank you.

The MINISTER OF WATER AFFAIRS AND FORESTRY (on behalf of the Minister for Trade and Industry): I would like to say that the Minister of Trade and Industry is on record as having said and reiterated that the process that was followed for awarding the licence to operate the national lottery was fair; it was rigorous and done with integrity. In this regard, his confidence in the work done by the National Lotteries Board remains. That’s as far as the process is concerned.

Regarding the second part of your question, I think those debates on whether or not South Africa should have a lottery, on whether or not South Africa should allow legal gambling, took place and were completed in 1997 when legislation was brought to this House. It was supported by all of you in that South Africa was going to engage in these processes to ensure that illegal gambling was kept out of the country and that you get whatever revenue might be accumulated for developmental processes. So, I don’t think that question arises now.

But, not being the Minister of Trade and Industry and just being the acting Minister, I cannot speculate on what the Minister would have said in response to your question. Thank you.

Dr P J RABIE: Thank you, Deputy Speaker. Hon Minister, from the DA’s side we would like to know who is going to pay the legal costs in terms of the ruling of Judge Willie Seriti regarding the investigation and the application of Uthingo and Gidani. From the DA’s side we’d like to know who is going to pay the legal costs. Will it be the Department of Trade and Industry, or the National Lotteries Board? Finally, who is going to take responsibility? Is it going to be the Minister, the Department of Trade and Industry or the National Lotteries Board? Thank you.

The MINISTER OF WATER AFFAIRS AND FORESTRY (on behalf of the Minister of Trade and Industry): Hon member, obviously, if the judgment says that the Minister must pay the costs, the department will pay the costs. If it says that it should be the National Lotteries Board… I don’t know which respondents have been asked to pay the costs, but the people that have been asked by the court to pay the costs will do so.

I am not sure just what you are trying to ascertain with your question.

Could you clarify this? I’m not sure whether you said the Minister must personally pay the costs.

Dr P J RABIE: Yes, I would like to elaborate on that. This is the taxpayers’ money, and we would like to know whether we get value for it or whether is it being spent on court cases. Thank you.

The MINISTER OF WATER AFFAIRS AND FORESTRY (on behalf of the Minister of Trade and industry: Through you, Madam Deputy Speaker, the Minister holds office as a member of the executive on behalf of the South African people. If his department has briefed lawyers, the department will be the one paying the costs of lawyers, unless you are saying in this case that the court ordered specifically that the Minister pay the costs.

Prof E S CHANG: Thank you, Deputy Speaker, and thank you, Minister. We do not think that the Minister is 100% wrong, but this is now creating a controversial grey area. Could the Acting Minister of Trade and Industry give this House an assurance that there will be mechanisms in place in the future to avoid confusion in terms of the grey area that this situation created?

The MINISTER OF WATER AFFAIRS AND FORESTRY (on behalf of the Minister of Trade and Industry): Thank you, hon member. I want to avoid talking about what will happen in the future, because a lot of action is going to take place or may take place in this case. So the Minister of Trade and Industry will be guided by the outcome of this case or other cases in terms of how our courts will interpret the legislation. If there are grey areas that are exposed through this process, I’m sure that the Minister will consider taking corrective action. Thank you.

Dr P J RABIE: Madam Deputy Speaker, hon Minister, we from the DA and the general public at large feel that the government’s money was misappropriated regarding legal costs. We feel that the hon Minister owes the general public an apology regarding this particular appropriation of public funds. Will he do it or not? Thank you.

The MINISTER OF WATER AFFAIRS AND FORESTRY (on behalf of the Minister of Trade and Industry): Hon member, if I am taken to court to defend the government and its position, I don’t understand how you can call that useless or fruitless expenditure. So I do not agree with you that the taxpayers’ money was unnecessarily wasted. The Minister had to go to court to answer to an application that called him to answer in court. Thank you.

The DEPUTY SPEAKER: Order! Hon members, I’m under the impression that we ask questions because we need answers. But if we ask questions because we desire a specific answer, then it becomes very difficult for this exercise.

Withholding tax regime on gross payments to visiting entertainers and
                            sportspersons

1. Mr B A Mnguni (ANC) asked the Minister of Finance:

   (1) With reference to the final withholding tax regime on gross payments to visiting entertainers and sportspersons which was introduced in 2005, (a) what is the SA Revenue Service’s (Sars) receipt from this source and (b) what mechanisms are in place to ensure that potential revenue from this source is declared and collected;

   (2) whether international entertainers and sportspersons or their local representatives have instituted objections against their assessments; if so, what are the relevant details;

   (3) what tax concessions can be expected in respect of the 2010 Soccer World Cup tournament? N435E

The MINISTER OF FINANCE: Thank you very much, Deputy Speaker, and thank you, hon Mnguni, for the question.

The final withholding tax for visiting entertainers and sportspersons was introduced by the Revenue Laws Amendment Bill in 2005, and the President signed the proclamation on 28 July last year, so that this became effective from 1 August 2006.

Since the introduction, the SA Revenue Service has collected about R10 million in withholding taxes for the first seven months of the legislation’s operation. The legislation has a compliance mechanism and also associated sanctions built in. For example, a South African resident who is primarily responsible for organising an international event in South Africa must notify Sars of the event within 14 days of concluding an agreement to organise the event. This also imposes certain obligations on the organiser, including a joint liability for taxes unpaid and so on.

Within the large business unit of Sars there is a small dedicated team who focus on this area, and there is ongoing communication from the team. The commercial banks involved in promotion normally require a promoter to provide a tax clearance certificate so that the issues are timeously dealt with by all parties concerned. There have been no objections to date. Thank you very much, Deputy Speaker.

Mr B A MNGUNI: Ke a leboha, Tonakgolo ka karabo ya hao. [Thank you, hon Minister, for your answer.]

In the event that the organiser does not inform the Sars team in time - and some might like to dodge the tax, and don’t publish in the media or on the Internet - what measures are in place to recover or to take care of the tax due?

The MINISTER OF FINANCE: Deputy Speaker, the chain works. It’s unlikely that a promoter will have sufficient cash so that he or she does not need a commercial bank. You have a mechanism in which the banks are directly involved. The banks would require that a tax clearance certificate be shown before they would support a promotion like this.

It deals with a set of relationships, because if the banks fail to act, they will not be acting in the context of the letter and spirit of the law and they know that they would invite detailed enquiries from Sars. So they act, and act correctly. But if the promoter fails to ensure that the sportsperson or the entertainer pays the tax, then it will be recovered from the promoter. I have no doubt about that.

I don’t think we have encountered difficulties. What we are doing is not unique to South Africa. That is why, whilst we may have only introduced the legislation late and it’s only been operational for a few months, there haven’t been any complaints or objections to it. The hon Mnguni sits on the committee. He would know how the section of the Revenue Laws Amendment Bill went through, and since its operation, it’s operational.

Mr I O DAVIDSON: Thank you, Madam Deputy Speaker. In respect of the question asked, I noticed that the Minister didn’t answer the third part with regard to 2010. I wonder if he could enlighten us in that regard?

The MINISTER OF FINANCE: In respect of the provisions applicable on the withholding tax, no concessions were sought from Fifa. Of course, for 2010 Fifa has sought a series of concessions on other issues, such as the importation of goods into the country without trade taxes, the ability to distribute those goods without the imposition of VAT, for instance, and the idea of tax bubbles where merchandise is sold. But those are dealt with under different provisions. For instance, there’s no withholding tax that would apply in respect of the players coming in. Fifa did not ask for this issue to be dealt with in the negotiations and agreements struck. Thank you.

          Government policy on taxation in relation to GDP

1. Mr I O Davidson (DA) asked the Minister of Finance:

   Whether he will make a statement on the Government’s policy on taxation as it relates to the level of revenue collected in terms of the Gross Domestic Product (GDP)? N445E

The MINISTER OF FINANCE: Thank you, Deputy Speaker, and thank you to the hon Davidson for the question. On 14 June 1996, in this House, we tabled a macroeconomic reform strategy entitled the Strategy for Growth, Employment and Redistribution. In that document one of the aspirations we set out was a tax-to-GDP ratio of 25%. It was then contained in the document as an aspiration. It is very important because, in the previous year, in 1994-95, the tax-to-GDP ratio was only 22,5%.

Now the 25%, granted, was a kind of rule of thumb, taking account of what government might want to take out of the economy on the one hand and, on the other hand, the developmental needs and how we would have to exercise that position. None of these would be fixed for all time. The 25% is still there, but we are now looking at it from the other side of the 25% compared to where we were when we tabled Gear. So there is one set of issues. I think it is a kind of discussion that we must have in this House and elsewhere from time to time.

The other issue that is important about what we had then and what we have now is the composition of tax. In the 1994-95 year personal income tax made up about 40% of taxes collected. In the current fiscal year we anticipate it will be about 29,2%. That has been kind of constant, depending on how much spending there is in the economy, but in 1994-95 it was 26,1% and now it is kind of 28%.

So there isn’t that much movement, but the big change has been in respect of corporate tax, which in the 1994-95 year was as low as 12,1% and now is double that. So the big change has, in fact, been on the corporate side.

Now this is important, because it clearly has been an area where the bulk of base broadening has happened. It is also important, because the administrative efficiency of the SA Revenue Service would be tested right here as there is a battle of wits about these issues. It is indicative of the high levels of profitability, because company income tax is, of course, a tax on profits. But I think that it is also important to understand that that change brings with it a variability that would not be there in the same way if you were more dependent on secondary taxes. It is a tax on profits and so, when profits are in decline or you come to the end of the business cycle, there is then likely to be less company income tax to be collected.

So the cyclical nature of corporate taxes is something we need to understand. Your colleague the hon Stephens is not in the House, but this issue that we were talking about yesterday - about the surplus - is largely a consequence of this issue. So 25% is there; it’s not as aspirational as it was when we tabled the strategy in 1996, but it is still some kind of a reference point. I think more important than just that ratio is also the composition of the tax yield. Thank you.

Mr I O DAVIDSON: Thank you, Madam Deputy Speaker, and thank you for that reply, Minister. I take the point that the Minister has made, but notwithstanding the fact that 25% was an aspirational figure, I think there was a clear indication, particularly to overseas investors, of the type of the level of taxation that would possibly be applicable to them in terms of investing in this country. In other words, there was a figure designated which, give or take, they could relate to in terms of their commitment to South Africa and their tax commitment.

That has now gone out of line and, quite rightly, as you said, corporate tax has now increased quite considerably as a proportion, which just underlines the importance of the question of giving some sort of indication to corporates out there, and more particularly to overseas investors out there, of what your policy in respect of taxation is, because that speaks to their forward planning exercise in terms of where they are going to invest. I know the Minister is somehow sceptical as to exactly what … [Interjections.]

The DEPUTY SPEAKER: Your time has expired and I still don’t get the question.

Mr I O DAVIDSON: Well, I think the Minister gets the gist of the question.

The MINISTER OF FINANCE: I should get up and say I don’t get the gist. [Laughter.]

Regarding the 12,1% in 1994-95, the corporate tax rate in the budget then was reduced to 40% from 48% and a secondary tax on companies was introduced at the rate of 25%. We have had this argument and there are those who appear before the committee and so on, who are quite ideological about the tax and dividends. Now we are comparing like with like, and we are comparing the 29% corporate tax rate.

I have looked at a number of surveys undertaken by the World Economic Forum and by various universities, at a competitiveness survey undertaken by the World Bank, at a “Doing Business in 2007” survey undertaken by the International Finance Corporation and the World Bank together. None of them raised tax rates as an issue in quite the same way. I think that what they would do – and, of course, business does not like paying tax - is rather deal with an environment that is a lot more certain.

Some of the things that you have seen in some new countries, like some of those formerly of the Russian Federation, are that they have had these flat taxes. They have privatised all kinds of things, and then realised that it is actually not workable, and they have had to retreat. That creates far more uncertainty than what any investors had to deal with in their tax relations in South Africa.

So our communication to all investors is: Steady as she goes. I believe that we have a reasonable relationship. Sometimes businesses complain that they do not like this ease with which somebody from Sars writes, and says, “This is my card, and I am your dedicated representative. If you have any problem, call me 24 hours a day. We are here to render a service.” They do not like that; they feel it is too close.

I do not know if tax rates or the tax composition in this country is as much of a problem as some rabid free-marketeers sometimes hold it out to be. [Time expired.]

Reporting of suspicious transactions to Financial Intelligence Centre
                  (FIC), and investigation thereof

1. Ms J L Fubbs (ANC) asked the Minister of Finance:

   (1) (a) How many suspicious transactions were (i) reported to the Financial Intelligence Centre (FIC) since its inception and (ii) investigated and (b) how is the money involved in established money-laundering operations treated;

   (2) whether any criminal investigations were instituted against any person(s) as a result of suspicious transactions; if not, why not; if so, what are the relevant details;

   (3) whether the FIC detected any funds that may have been used for financing terrorist activities; if so, what are the relevant details? N436E

The MINISTER OF FINANCE: Thank you very much, Deputy Speaker, and my thanks go to the hon Fubbs for the question. In the past financial year, 19 793 reports of suspicious or unusual transactions were received by the centre. Not all of the transactions are criminal in nature. Joan Fubbs may go to the local branch of a bank and suddenly want to draw R100 000 from her account on a particular day. The bank would say, “Hon Fubbs, come back this afternoon,” and in the meantime it would say, “This is an unusual transaction.”

The CHIEF WHIP OF THE OPPOSITION: [Inaudible.]

The MINISTER OF FINANCE: Yes, can we ask you to do the same, hon Gibson? [Interjections.] What the Financial Intelligence Centre doesn’t do is that it doesn’t investigate. It receives these suspicious transactions. In the legislation we thought it more important to have a body that has a set of good relations with a range of financial intermediaries. That is a reference point.

The focus is largely on the eye – it is intelligence rather than evidence. So, in the drafting of the legislation this information, in the form that we receive it in the FIC, can’t be used in a court of law either, but it first has to be processed by law-enforcement agencies. So there is a very close relationship with the SA Police Service, with the Directorate of Special Operations - the Scorpions - and also with the Asset Forfeiture Unit. That is where these issues are dealt with, so that the FIC exists as a collection point rather than as an enforcement agency in own name and right.

With regard to the third part of the question, if there is a transaction that is deemed to be in violation of the “Pocdatara”, or the Protection of Constitutional Democracy Against Terrorist and Related Activities Act, the other agencies will have to deal with it – we would be aware of it. Sometimes, by the way in which they look at information and understand transactions as they flow out of particular points or between particular sets of individuals, they then have to make the inferences and take that issue further.

We also have a responsibility in terms of standing resolutions of the United Nations Security Council to act in a particular way on those matters. Thank you.

Ms J L FUBBS: Thank you very much, hon Deputy Speaker, and thank you also, Minister Manuel, for what can only be a very enlightening clarification that I know a number of South Africans, if not most, would welcome.

Minister, there is just one area which you may wish to give an opinion on, which would perhaps further reassure people. As you are aware, most of the large banks have been complaining that the current FIC obligations are just so onerous and that that is part of the reason why administration costs are rising. They want to do so much, they will say, for the bulk – the majority

• of South Africans to bring them in. But it is this FIC that is making it difficult for them. What is your opinion regarding the continuation of what has just become a kind of mantra of a complaint by the banking community? Thank you.

The MINISTER OF FINANCE: Deputy Speaker, even if the banks complain I think we need to say thank you to the banks in South Africa, because they are actually very highly compliant. I think what we are seeing in respect of the banks is that they respect their licences. I know for ordinary individuals that when you arrive at the airport you need $100 to get a taxi on the other side, and they want your electricity bill. There is a sense of red tape about this.

If you look at the issue of administrative costs in the banks, for a long time the banks had indicated that they did not want individuals with small accounts. But since the very same banks initiated Mzansi, you have seen those numbers take off. So the issue of costs is not so much a problem for them. The way in which the law is structured is that the front desk people

• the tellers - would be responsible. So it is for that reason that the tellers actually insist that all of them should be covered. They are the last port of call. They would end up in court if they violated this, and so they are actually enforcers of the law.

On balance, I don’t think it works too badly. I also don’t think that the banks have excluded people on this basis. It is, in fact, a lot more difficult to enforce with the same intent in respect of some other intermediaries. Estate agents and, just recently, the FIC held workshops with the Estate Agency Affairs Board because, if an estate agent has a sense that somebody has a big suitcase of money and they are transacting in that way, they have a responsibility to report this. Similarly, people dealing in motor vehicle sales and the casinos have that kind of responsibility, and our battle is in fact to hold up the banks as an example and to get the other intermediaries to act in the same spirit.

It is this acting together that will prevent the money-laundering. We must provide no place to hide for crooks and launderers, because laundering always comes after the commission of some other crime. This would either be drugs transacted, taxes evaded or some other way in which people have accumulated money that then results in the laundering. We must ensure that we can deal with laundering within that context, but understand that ahead of it are some other crimes as well. Thank you.

Mr S J F MARAIS: Deputy Speaker, I just want to follow up by asking if there were any investigations and prosecutions as a result of these transactions, and, if so, what was the monetary value attached to those? Secondly, does the success or lack thereof justify the operation costs of the FIC and also the cost to individuals and business in complying with this? Thank you.

The MINISTER OF FINANCE: Deputy Speaker, is he still a maiden, the hon Marais? He lost it. The DEPUTY SPEAKER: He lost it yesterday, I am told.

The MINISTER OF FINANCE: Of just the suspicious transactions reported, the amount covered in the reports is about R427 million. But those are just reports; they don’t mean anything. My difficulty, hon Marais, is that our enforcement agencies will take these things forward. You will see increasingly that laundering is one of the charges along with other charges brought against individuals. We have to do a lot more work in this area.

Part of what we must ensure is that the law-enforcement agencies actually have a better capability to prosecute in this area. That is work in progress; it is about building the capacity to ensure that the suspicious transactions can be sorted, and those that hint at something else pursued with more vigour. But it is not our responsibly in the FIC.

Your question about the monetary value of business complying and so on: you can’t look at life like that. You won’t know the value of the FIC until you have discovered some day that there are people who have been amassing money to launch dirty nuclear bombs or something like that. You won’t know that.

So, you can’t quite argue like that, because the role of intelligence and financial intelligence is one of those areas. It can’t actually just be measured narrowly in terms of rands and cents. There is a series of other issues that come into play, and it is very important that we appreciate that in the wider context of law enforcement and the spirit of democracy in this country. Thank you.

Intensification of trade liberalisation and export diversification, and impact thereof on Asgisa

1. Prince N E Zulu (IFP) asked the Minister of Trade and Industry:

   (1) Whether trade liberalisation and export diversification have been intensified to counter the volatility in commodity pricing within the economy; if not, why not; if so, what will be the impact on the Accelerated and Shared Growth Initiative for South Africa (Asgisa);

   (2) whether he will make a statement on the matter? N5E

The MINISTER OF WATER AFFAIRS AND FORESTRY (on behalf of the Minister of Trade and Industry): Madam Deputy Speaker, the answer to the question is as follows. Yes, indeed, our efforts to diversify our basket of exports are intensifying, although we must recognise that this is also a gradual process. We haven’t only now started to look at this, but we can say that it is now being intensified.

Some of the prerequisites that are required for export diversification are, firstly, the international competitiveness of exports, which depends mostly on the underlying competitiveness of the South African economy itself and also on the exchange rate levels; secondly, it is market access that requires participation in the multilateral trade organisations, the ability to negotiate favourable trading terms within those organisations and mutually beneficial trade with bilateral and regional partners; thirdly, resource support in which we could include financial incentives, trade finance and insurance products, all within a basket of government interventions designed to improve the competitiveness of exports.

Regarding trade liberalisation, this will not be intensified as an end in itself, but will be seen rather in support of a multilateral development trade agenda defined by the Doha Round of World Trade Organisation talks, and also where the department itself deems it necessary for strategic purposes. The examples of the latter include where we have signed agreements like our trade and development co-operation agreement with the EU, the SADC Trade Protocol and the recently concluded free trade agreement with the European Free Trade Association.

Obviously, any intensification of the diversification of our exports and trade liberalisation that seeks to improve competitiveness of the domestic economy, and thereby move the economy onto a sustainable growth path, is fully aligned with the objectives of the Accelerated and Shared Growth Initiative for South Africa. Thank you.

Prof E S CHANG: I will speak on behalf of Prince Zulu. My question is very simple. It relates to labour liberalisation and free trade. What impact will they have on South Africa’s economic growth rate, on job creation and on job losses? Thank you.

The DEPUTY SPEAKER: I did not get …

The MINISTER OF WATER AFFAIRS AND FORESTRY (on behalf of the Minister of Trade and Industry): Neither did I, Madam Deputy Speaker.

Prof E S CHANG: Oh, okay. I was asking how trade liberalisation and free trade would impact on the South African economic growth rate. Also, what will the impact be on job creation and job losses?

The MINISTER OF WATER AFFAIRS AND FORESTRY (on behalf of the Minister of Trade and Industry): Well, if you talk about diversification of exports, obviously as we diversify exports we add value. If you look at what we have done in the past few years, we have actually diversified our exports from the primary commodities, which are really your mineral resources, to manufactured goods to the extent that the export of manufactured goods has actually overtaken that of the primary commodities. As we add value to our products, more jobs are created at home, and obviously that is a good thing.

When it comes to trade liberalisation, I think, as South Africa, we have gone a long way towards liberalising our trade, reducing the tariffs that are there in the economy and the subsidies. What we would look at doing is to keep protection in those areas, industries or those sectors which are sensitive for our economy, particularly in a labour-intensive sector that can create a lot of jobs and where there is clear evidence that there is dumping or it is being threatened by imports from other countries. A government would then, in protecting jobs, try to use trade liberalisation to balance that. So, both of them do have an impact on job creation in the country.

Dr P J RABIE: Thank you, Deputy Speaker. Acting Minister, you referred to Asgisa and so forth. My question to you is: Will you be able to tell the Assembly when the National Industrial Policy Framework will be released? We believe that it has been before Cabinet, and we would appreciate it if you could give us an indication as to when it will be released to the general public. Thank you.

The MINISTER OF WATER AFFAIRS AND FORESTRY (on behalf of the Minister of Trade and Industry): Thank you, Chairperson. I think that is a new question, because indeed you are looking for a date as to when this policy will be released. All I can say is that the Department of Trade and Industry has worked extensively on the National Industrial Policy Framework for our country, the aim of which it is to create a platform for what I have just spoken about – the competitiveness of our economy and ensuring that we diversify the basket of our exports, as well as that we also look at our niche markets where we can have even more tradable exports. As regards the date, hon member, a thousand apologies. I wouldn’t know that.

Mr S J NJIKELANA: One cannot help but appreciate, according to the responses from the Minister, the government’s policy and strategy on the question I have asked regarding the macroeconomic reform strategy. The prerequisites that are listed here make reference to that. I would like to emphasise the fact that there is a paradigm shift in terms of export diversification, particularly the beneficiation strategy, and in export incentives.

Obviously, one can also further ask the following question: Minister, are we confident, as South Africa, that export diversification can rebuff the volatility of commodity prices? I say this with special reference to the expected impact on sector investments as found within the Accelerated and Shared Growth Initiative for South Africa. Thanks, Chair.

The MINISTER OF WATER AFFAIRS AND FORESTRY (on behalf of the Minister of Trade and Industry): Hon member, I can say, yes, we are confident because the proposed National Industrial Policy Framework is creating a platform to address two key issues on which export diversification rests, which are competitiveness and capacity. This framework will indeed pave the way for South Africa to mitigate the impact of volatile commodity prices.

In terms of the third pillar of export diversification, which is that of market access, hon members know that as we speak our President, accompanied by several Ministers, including our Minister of Trade and Industry, is in the Kingdom of Saudi Arabia to spearhead South Africa’s trade and investment drive into this new high-growth market. As South Africa, we need to target new, dynamic and nontraditional growth markets. And, I think, that is what the DTI’s National Industrial Policy Framework seeks to do. Thank you.

          Support mechanisms for land claims beneficiaries

1. Ms C Nkuna (ANC) asked the Minister for Agriculture and Land Affairs:

   What mechanisms will be put in place to support the land claims beneficiaries in order to ensure that they remain productive?

                N431E
   

The MINISTER FOR AGRICULTURE AND LAND AFFAIRS: Thank you, Chair. The Land Claims Commission and the Department of Land Affairs are working jointly on a settlement support implementation strategy. In each regional office of the commission, settlement support staff are involved in the early settlement processes of a land claim to ensure that claimants are involved in the land use planning so as to make informed settlement choices; that project planning is done within the socioeconomic and sustainable requirements; that the drafting of feasible business and land use plans is done; that there are memoranda of agreement with the relevant role-players, such as the Department of Housing, municipalities and the provincial departments of agriculture in the settlement support processes; that a joint proposal is made by the commission with AgriSeta and the Department of Labour for skills development and long-term mentoring of projects; that there is an area-based approach to ensure that all projects are part of the provincial, local and district planning processes to ensure sustainability; to promote sustainable and productive use of agricultural land, ensuring that no arable land lies fallow; and, to facilitate access for communities to the government’s agricultural assistance programmes, such as the Comprehensive Agricultural Support Programme, the Micro-Agricultural Financial Institutional Scheme of SA and Land Bank packages and other schemes. Thank you, Chair.

Ms C NKUNA: Thank you, hon Chairperson. Thank you, hon Minister, for the detailed response you gave to my question. Hon Minister, you mentioned government’s agricultural assistance programmes like the Comprehensive Agricultural Support Programme – Casp - the Micro-Agricultural Financial Institutional Scheme of SA – Mafisa - the Land Bank and others. Hon Minister, what mechanisms do you put in place to ensure that funds provided for these schemes are utilised to the full and not rolled over?

Inkomu Mutshami wa Xitulu. [Thank you, Chairperson.]

The MINISTER FOR AGRICULTURE AND LAND AFFAIRS: Thank you, Chair. That is a very difficult question, because first of all Casp programmes are not managed at national level; they are managed and implemented at provincial level. The major challenge there has been for a long time the lack of skills and capacity. However, the provinces have improved in the past two years or so. They have ensured that they have the required capacity, and we are hoping that there will be a great improvement in terms of roll-overs this year. In terms of Mafisa, we have had three provincial pilot projects in the Eastern Cape, Limpopo and KwaZulu-Natal.

We have been assessing and evaluating, learning from the lessons that we have learned in these provinces. It is hoped that we will be able to roll out Mafisa to all provinces in the coming year. We have already started to do assessments in those provinces and we believe that we are ready with the roll-out of Mafisa. We have personnel at national level and also in the provinces who are working closely on these projects and who are monitoring them to ensure not only that we have projects that are not going to fail, but also that through those business plans, the monitoring and the evaluation officials we can ensure that these programmes become sustainable. Thank you.

Mr A H NEL: Thank you, Chair. Minister, in terms of the question I asked and the answer I am getting – it hasn’t reached me yet - let me just say upfront that we support measures that bring sustainability. Yesterday we asked the Director-General of Land Affairs this specific question. He assured us that they have enough plans and that they are planning and strategising every day. But – and then he passed the buck – he said that the problem lies with the Department of Agriculture and the provincial departments which cannot put these plans in place to support beneficiaries. My question, Madam Minister, is whether it is because of this that you asked the Public Service Commission to investigate the capacity of the Department of Land Affairs and its director-general. Thank you.

The MINISTER FOR AGRICULTURE AND LAND AFFAIRS: My investigation was based on a lack of capacity, on high vacancy rates that we have in the department and also on problems around the management of state leases and state land. Because the problem was huge we sought the assistance of the Public Service Commission so that they could advise the department, so that they could also look at the gaps and fast-track corrective measures that would assist us to ensure not only capacity for the department but also to be able to assess skills - do a skills audit – in terms of the human resources that we have in the department, where the gaps are and what needs to be done. Thank you.

Use of rail infrastructure to transport soccer supporters during 2010
                     Soccer World Cup Tournament

1. Mr M M Swathe (DA) asked the Minister of Transport:

   Whether he and his department have considered the construction of new railway lines or the use of old rail infrastructure for the 2010 Soccer World Cup Tournament to transport the large numbers of soccer supporters to the stadiums, thereby using trains as a form of mass transport; if not, why not; if so, what are the relevant details? N449E

The MINISTER OF SCIENCE AND TECHNOLOGY (on behalf of the Minister of Transport): Hon Chair, just this morning my attention was drawn to an entry in a publication called the Who‘s Who of Southern Africa. Someone in there describes me as “a nice terrorist”. I don’t know what that means, but that person goes on to say that if I were to leave Azapo and join the DA, I would be voted President of South Africa. [Laughter.]

Of course, this raises interesting things, because it would mean that I would be the DA leader. It would mean that their problem was solved; they would have a leader now. [Laughter.] But this would also mean that they should behave in a manner that would make me remember them with fondness when I am their leader. [Laughter.]

The answer to the question asked by hon Swathe, who is an hon member of the DA, is as follows. The Public Transport Infrastructure and Systems fund will not be funding any construction of new passenger railway lines. However, the Department of Transport has identified a number of key rail infrastructure projects that will support the 2010 Fifa World Cup and, more importantly, leave a legacy. For this purpose, a significant portion of the PTIS fund has been allocated to the SA Rail Commuter Corporation Ltd and is focused on upgrading existing infrastructure such as signalling, stations, telecommunications and so on, and on specific security-related infrastructure such as the construction of railway police stations.

This investment totals R1,361 billion, which is additional to the Medium- Term Expenditure Framework capital allocation of the SARCC. This is spread over the financial years 2006-07 up to 2009-10.

Mr M M SWATHE: Thank you, Chairperson, and hon Minister. My follow-up question is with regard to the trains as you indicated, correctly so, that there would be no upgrading of infrastructure. But what we as South Africans are facing is that in 2010 we will need a lot of transport. That is why I am asking how many trains we can have so that we can alleviate this question of transportation in 2010. If that is the case, how are you going to use this infrastructure after the 2010 soccer event? Thank you very much.

The MINISTER OF SCIENCE AND TECHONOLOGY (on behalf of the Minister of Transport): I did say, hon member, that there will be upgrading. I think the answer indicates very clearly that quite a lot of resources will be invested in upgrading transport infrastructure for 2010, and we described those investments as the type of investments that would leave a lasting legacy for our people. That means the population will inherit an infrastructure that is much better - we will be able to move them from place to place much better – that is, after the World Cup - than we do now.

Mr C M MORKEL: Minister, thank you for answering that question. I think you covered part of the follow-up question I was intending to ask when you mentioned that there would be an upgrading of the security systems on our railways. I mention this with reference to the legal action that in your acting capacity you may or may not be aware of with the rail commuter action group and that there have been victims that now need to be compensated. This highlights the point that our commuters do not feel safe on our railway lines.

The SAPS railway units that are being rolled out are one step in the right direction. I ask you, though, Minister: if South Africans have no confidence or lack confidence in using our railway lines, can’t we therefore expect international visitors also to have a similar lack of confidence. What can we as South Africans therefore do in trying to make 2010 work in order to ensure that our railways are safer? [Time expired.]

The MINISTER OF SCIENCE AND TECHNOLOGY (on behalf of the Minister of Transport): Hon Chair, I imagine that it was very clear in the initial response I gave that, in addition to comprehensive plans that are being made to ensure that the transport system is better than it is at present, there is an element of security that is being built into these processes that are under way at the moment.

So, yes, attempts and plans are being made with various elements – not only with the Department of Transport but also with municipalities in the metros, provincial administrations in our provinces and various other elements in our society that are involved in the security of transport and so forth - to make this system work as successfully as possible. So, yes, there are advanced plans that will take care of the concerns that the hon member currently has.

Mr S B FARROW: Thank you, Chair. Minister, acting on behalf of the Minister of Transport, I’m sure that your versatility will put you in good stead when you decide to become a member of the DA. [Laughter.]

May I just ask you something? You indicated to my colleague over there that there is a certain amount of co-ordination taking place between the various spheres of government, so presumably the department is playing a leading role in the allocation of this funding towards those various municipalities and metros?

In terms of the old infrastructure, what exactly will the funding be used for? Will it be used to upgrade the infrastructure or to replace it with new infrastructure? This is because it appears that if you come up with a very bold project, such as the Gautrain, you get all the money in the world thrown at you, but yet there are thousands upon thousands - I don’t know how many – of old railway coaches sitting at Rosmead.

Will it be a consideration that we actually use what we’ve got, fix it up so that it does in fact become a lasting legacy and not one of the white elephants like the Gautrain will be?

The MINISTER OF SCIENCE AND TECHNOLOGY (on behalf of the Minister of Transport): Hon Chair, not being the Minister of Transport, I don’t have all the details at the tips of my fingers relating to the question that the hon member has asked. But I am aware that, yes, there is a comprehensive plan that involves the metros, the municipalities and various levels of government. I’m not aware of the specific numbers to give you, hon member, but I will let the Minister of Transport know about your questions, and you might get more joy from him than you do from me. Thank you very much.

Ms N P KHUNOU: Chairperson, I know that in the past there was a problem with signalling. Upgrading will be highly appreciated as this will help in the reduction of accidents. However, when you do upgrade the stations, will you consider accessibility for people with disabilities as this is a problem with all the stations - there is no accessibility for people with disabilities? Thank you.

The MINISTER OF SCIENCE AND TECHNOLOGY (on behalf of the Minister of Transport): Hon Chair, I am not quite sure when the work will be concluded. What I do know is that one of the priorities of the plans that the Department of Transport has for upgrading transport systems in the country is making these facilities accessible to people with disabilities.

Once again, I’ll not be able to tell the hon member where the process is, but I do know that this is part of the plans. This is one of those things that I’ll sensitise the Minister about.

Successes and challenges in relation to the Microeconomic Reform Strategy (MERS)

1. Mr S J Njikelana (ANC) asked the Minister of Trade and Industry: (a) Which aspects of the Microeconomic Reform Strategy (MERS) have (i) been undoubted successes and (ii) encountered challenges and (b) how is he addressing the challenge posed by the factors that are limiting accelerated and shared growth and development in the economy? N427E

The MINISTER OF MINERALS AND ENERGY (on behalf of the Minister of Trade and Industry): Chairperson, the answer to part “a” of the question is as follows. Since the inception of our Microeconomic Reform Strategy, or Mers, there have been significant successes in areas of sector support, developmental finance, equity and technological advancement.

In the area of sector support the most notable success has been with our Motor Industry Development Programme, MIDP. This programme has effectively secured the survival of the South African automotive industry, helping us to preserve employment in the core automotive sector and generating significant linkages to other sectors such as leather and plastics.

Government support has also significantly contributed to the restructuring of upstream resource-based processing sectors like the steel and chemical industries that were experiencing difficulties in the 1990s. These industries have been successfully restructured and are now globally competitive.

Coming to the leveraging of development finance institutions, or DFI, as agents for socioeconomic change, that is a core objective of Mers. Under the Microeconomic Reform Strategy we have witnessed the increasing capacity of our DFI, Khula, to deliver on its mandate. We have witnessed the roll- out of the SA Microfinance Apex Fund, Samaf, and the improved strategic alignment of the Industrial Development Corporation with government’s poverty and employment targets for 2014.

Over recent years, the Industrial Development Corporation has enjoyed success in supporting labour-absorptive sectors and broad-based black economic empowerment initiatives. A promising development is that the Industrial Development Corporation’s most successful investment projects in terms of employment creation have been in the expansion projects. The DTI has driven the mainstreaming of BEE as a fundamental feature of the business environment in South Africa, firstly, through the promulgation of the Broad-Based Black Economic Empowerment Act and, recently, the gazetting of the triple BEE codes of good practice.

On the technological front, various technological programmes have also functioned well, such as our Support Programme for Industrial Innovation – Spii, for short - and our Technology and Human Resource for Industry Programme, Thrip. Moreover, the national spend on R&D has improved from 0,76% of GDP in 2001-02, to 0,87% of GDP in 2004-05. There is also supplementary evidence to suggest that South Africa is emerging as a regional technology hub, given the country’s participation in various cutting-edge projects such as the Square Kilometre Array.

Coming to the next part of the question, the challenges experienced, notwithstanding the above-mentioned successes experienced by the South African economy, Mers has confronted various challenges and constraints as it is implemented. These include a lack of intragovernmental co-ordination.

With regard to those crosscutting initiatives, which I think are being addressed currently through the cluster system and government … Thank you. [Time expired.]

The HOUSE CHAIRPERSON (Mr G Q M Doidge): Hon members, I want to remind you of an NA Rule - and I would like you to look it up; it is Rule 46 - that requires of us not to converse aloud during the business of the House.

During the course of the debates this week I’ve often had to appeal to you not to raise your voices. You are drowning out those that have the floor to speak and address the House. I would like you to remain in the House. I’m not sending you out to have a cup of tea, but, at the same time, could you please observe the requirements of NA Rule 46, which you adopted. Thank you.

Mr S J NJIKELANA: Ndiyabulela, Mphathisihlalo noMphathiswa obambeleyo ngempendulo yakhe. [Thank you Chairperson, and the acting Minister for his response.]

I once again appreciate the response that was given, suffice to say that what’s helpful here is for us to understand that not only should our focus be on the macro strategy, but also on the micro aspects and particularly on seeing it as a composite package in terms of economic transformation. I thought though, hon Minister, that you would also refer to the National Empowerment Fund, particularly since you have made mention of broad-based black economic empowerment.

My follow-up question is around the challenges, particularly the lack of intragovernmental co-ordination with regard to crosscutting initiatives. Could the acting Minister help us as to what exactly is being done to address that challenge? Also, what attempts are being made to respond to the challenges that are limiting the accelerated and shared growth and development in the economy? Thank you.

The MINISTER OF MINERALS AND ENERGY (on behalf of the Minister of Trade and Industry): Thank you, Chairperson, and thank you, hon member. Indeed, I forgot to mention the National Empowerment Fund, which was established to support our initiatives of financing broad-based black economic empowerment.

The hon member is correct in that having focused and attained stability at the macroeconomic level, we asked ourselves as government what we could do to deal with the micro aspect. That is where all these issues are that I have raised, such as SMME support, BEE, etc, which come into play with their supporting mechanisms and initiatives.

I mentioned that, despite the successes, we have experienced some challenges in this area, one of which is the sheer co-ordination of crosscutting issues amongst government departments that is currently being addressed through the cluster system. In this regard, there is also a lack of monitoring and evaluation, which is required to measure the impact of these programmes for the strategy to respond to an evolving economic landscape and, obviously, insufficient financial and human resource development for there to be implementation.

What are we doing to try to deal with the challenges? In 2006, the government adopted a more robust approach towards identifying and addressing what today are called the “binding constraints” on accelerated and shared growth in South Africa – the Accelerated and Shared Growth Initiative for South Africa, or Asgisa - which builds, in fact, on the successes of Mers and which seeks to address all the weaknesses identified.

As we know, Asgisa focuses on improving co-ordination through the cluster system of government. [Time expired.]

Dr P J RABIE: Thank you, Madam Chair. Acting hon Minister, I think what you’ve said here about Asgisa and the small, medium and micro business sector is extremely important. My question to you is that at the moment we have an excessive amount of red tape, which impedes the small to medium business sector. We, from the DA, think that we are propagating a one-stop approach in which entrepreneurs will be able to register small businesses and so forth.

It was mentioned this morning in the Portfolio Committee on Trade and Industry that you are going to review the excessive red tape regarding the small to medium business sectors. Would you be able to give us, again, a timeline when we’ll be able to streamline this particular legislation, because I think it is extremely important? The only way of solving unemployment here is to create jobs and creating jobs is the only means of expanding this sector. Thank you.

The MINISTER OF MINERALS AND ENERGY (on behalf of the Minister of Trade and Industry): Ngiyabonga lunga lelihloniphekile ngalowo mbuzo. [Thank you hon member for that question.]

Indeed, over the years the Department of Trade and Industry has been looking at mechanisms of reducing the burden for small and medium enterprises. Various studies have been conducted to look into this matter and several suggestions have been made to government. Just recently, the Presidency and Treasury were looking at how to deal with the regulatory impact on the functioning and success of small businesses. So, indeed, government is engaged in this.

As to when all these processes will come together, I think that’s a question we could answer some other time. I’m aware that within the Department of Trade and Industry, within what they call Cipro - the Companies and Intellectual Property Registration Office - there is an attempt to ensure that there’s decentralisation in terms of which people or companies can go to provinces to register their companies rather than depending on lawyers and consultants in Pretoria.

As far as one-stop shops are concerned, I think a move towards that has been taken through creating Seda - Small Enterprise Development Agency - offices in all nine provinces of our country. As you know, Seda is an institution that we brought about, bringing together Ntsika and bringing together what we call our community participation programmes - looking at co-operatives and the small business support division that was housed in the DTI.

We were trying thereby to bring these one-stop shops closer to the SMMEs so that those that need advice could go there. If they need export advice, they can go there. The writing of business plans, and several other things, they can get there. So, I think, the department has moved towards bringing one-stop shops closer to small businesses. Thank you. [Time expired.]

Prof E S CHANG: Chairperson, import costs drive competitiveness. Crucial import sectors are transport, energy and telecommunications. Those sectors are under domination by parastatals. How will the Minister of the Department of Trade and Industry effect … [Inaudible.] … in the microeconomic reform strategy there? The mandates of parastatals will be reviewed to ensure that emphasis is placed on delivery of efficient service, ensuring cost-competitiveness rather than profit-seeking for its own sake, when you consider that parastatals fall under the purview of the Minister for Public Enterprises?

Why will this entrepreneurship only occur in future and not immediately? Also, Minister, you know that we as South Africa claim to be the cheapest electricity producer in the world, but does the Minister know that our industry pays more for electricity in comparison with emerging countries like India and China, or even our friend … [Inaudible.] … Thank you.

The MINISTER OF MINERALS AND ENERGY (on behalf of the Minister of Trade and Industry): Hon Chairperson, I think the question was just too long for me. Regarding the first part of it, I think the hon Minister for Public Enterprises, who is the shareholder within the parastatals, would be able to answer. I would really request the hon member, if she has other questions, to direct them in writing to the hon Minister of Trade and Industry, as I do not have answers at the moment. Thank you.

             Current value of total pension fund surplus

1. Ms C B Johnson (ANC) asked the Minister of Finance:

   (1) What is the current value of the total pension fund surplus;

   (2) whether all participating pension funds have completed their actuarial evaluations to determine the value of the surplus; if not, why not; if so, how many participating pension funds have distributed the surplus;

   (3) whether he will make a statement on the matter? N437E

The MINISTER OF FINANCE: Hon Deputy Chair …

The HOUSE CHAIRPERSON (Ms C-S Botha): No, hon Minister. You are not a Deputy, and neither am I. I am a Chair.

The MINISTER OF FINANCE: My apologies, Chair.

The HOUSE CHAIRPERSON (Ms C-S Botha): Thank you. The MINISTER OF FINANCE: Who is this Ms C B Johnson?

The HOUSE CHAIRPERSON (Ms C-S Botha): She is your colleague, the hon Carol Johnson. But the supplementary question will be asked by the hon Mr Johnson.

The MINISTER OF FINANCE: Oh! I wondered about this sex-change stuff. [Laughter.] Let me give a perspective. There are 13 500 pension funds, which together have about R1 trillion under management. But there is a very significant disproportion in the operations because about 80 pension funds account for about 73% of all members.

Arising from the Pension Funds Second Amendment Act, a procedure was laid out for the apportionment of surpluses that accrued when funds converted from defined benefit to defined contribution.

As at 28 February 2007, the surplus apportionment schemes approved for distribution amounted to about R7,6 billion. But it’s hard to tell what that is a fraction of, so we don’t know what the total apportionment would be once the process is concluded.

The FSB estimates that the majority of registered funds have submitted surplus apportionment schemes but, again, the number is not known. One of the reasons for this is that they have to deal with stand-alone funds - frequently employer or bargaining-council funds. But then there are also the so-called umbrella funds that are made up of a myriad of individual funds. One of the difficulties with the umbrella funds is that the issue of trusteeship is a lot harder, because funds are just combined. There has been a great deal of concern expressed about this. Yet, on the other hand, individual funds require their own administration, and the costs thereof are prohibitively expensive.

As at 28 February this year – and that was all of 14 days ago - 581 schemes for surplus apportionment had been received by the registrar. Of these, 244

• 42% - had been approved, while the remaining 335 are pending or not yet completed.

There are also, arising from these funds, just over 15 000 that submitted no returns - either they were established afterwards or established as defined-contribution funds, or established for some other reason.

Now, it is not possible for the registrar to act just on the information received, partly because a lot of information was received very close to the due date. This requires a level of scrutiny which, as you can well imagine given the numbers involved, would require an enormous or mammoth administrative exercise. That is the situation. As of now, there is R7,6 billion in approved schemes for the apportionment of surpluses. Thank you.

Mr M JOHNSON: Thank you, Chair. Thank you, Comrade Minister. The answer has been quite profound and very comprehensive. Thanks for that. However, what measures has the Financial Services Board – the FSB - put in place to ensure that fund administrators give beneficiaries a fair value of what is due to them when they approve such applications? Linked to that also is a matter you raised about the minorities, that is those pension funds which were not actually approved. Given the fact that the minority of these pension funds did not submit the surplus apportionment schemes to the FSB for approval, what risks does this situation pose to the beneficiaries?

The MINISTER OF FINANCE: Madam Chairperson, I think it’s very hard in this case to generalise, partly because if one tracks through the history of pension fund legislation in South Africa - the oldest being 51 years old; it’s a 1956 piece of legislation – there have been a series of amendments. Some of these have been introduced to effect certain very important principles.

A late addition, for instance, is that the funds in the fund belong to the fund. I don’t want to say too much about this, because this legal basis may be tested because there is an instance now where individuals are alleged to have removed large sums of money from funds. This needs to be tested, and I am saying it is being tested in a court of law. The easier instances to deal with is where you’ve had strong trusteeship, because some of the changes introduced in the Pension Funds Act require 50-50 employer and employee representatives, and if they are all acting correctly with the dignity and fiduciary responsibilities required, you clearly don’t have a problem. You invite in the actuaries, you determine how much money was in the fund at the point of conversion, and then that must be allocated. Once you have done that, a series of other issues arise. You must then trace members who were members of the fund prior and contributors who may not be alive or may not be contributors any longer.

So, it’s a rather complex issue. It’s almost impossible to do this merely by looking at the papers. I am saying that the scale of the task is exceedingly difficult for the FSB. They will report to Parliament through the agency of the portfolio committee from time to time, but the key is just the determination of how much is available and to ensure that it is correctly apportioned when it is done. Thank you.

   Departmental strategy in relation to failed farming operations

1. Mr A H Nel (DA) asked the Minister for Agriculture and Land Affairs:

   Whether her department has a strategy to solve problems relating to failed farming operations where land restitution or reform took place; if not, why not; if so, what strategy?

          N458E The MINISTER FOR AGRICULTURE AND LAND AFFAIRS: Chair, yes, the Department of Land Affairs has a strategy in place in relation to failed land reform projects. These models include a settlement model for beneficiaries who have housing as their primary immediate need, a farming model and a strategic partnership model. Each model carries various options and has financial and human resource implications.
   

The land reform offices in the different provinces will have to carefully weigh up these options and decide with the affected beneficiaries on the best way forward, including a course of action for beneficiaries who have abandoned projects. The strategy also provides sound guidelines on what should be done when financial institutions want to repossess properties.

The Commission on Restitution of Land Rights also monitors projects where restitution has taken place to ensure sustainability. Should any problem areas be identified, intervention is initiated and facilitated in liaison with other relevant role-players, such as the provincial departments of agriculture and financial institutions, in order to devise appropriate strategies for their projects.

In addition, the commission and the Department of Land Affairs are working jointly on a settlement support implementation strategy to ensure the sustainable projects to which I referred in an earlier question. Mr A H NEL: Thank you, Chair. Thank you, Minister, for the answer. I listened very carefully to your answer because the problem of failed farming operations is a serious one. Apart from the fact that it is a waste of public money, one feels sorry for the people involved.

We have also formulated a plan to deal with the prerequisites for, and the failures of, land reform with help of experts. I will supply you with a copy. Maybe there is something that you can use. My question is whether your department’s strategy has been implemented as yet, and whether you can supply us with examples in which some of these failures were reversed. Thank you.

The MINISTER FOR AGRICULTURE AND LAND AFFAIRS: Thank you, Chair. For instance, the strategic partnership model has worked very well. In Mamahlola in Limpopo we have had a problem in which communities were unable to sustain their projects because of conflicts within that community. We then formed a partnership between this community and SA Farm Management, which is a company that includes white commercial farmers but also black experts who had formed this joint venture with the community of Mamahlolo.

Today they have already had great success. They are producing papaws, guavas, avocado, citrus and are already in the export industry; and both the company and the community of Mamahlola still have ownership of the land rights in the area and also a shareholding of over 50% of the business conducted on the land. Both parties are very happy and the project is a great success.

Adv Z L MADASA: Madam Chair, I would like to thank the Minister for her reply, as I was listening carefully. I would like to ask her, in view of the nature of this question, whether the problems that have been highlighted are as a result of policy failure or teething problems in the implementation of the policy of land restitution. Are they indicating that the policy itself is problematic or are they indicating that there are problems in the implementation?

The MINISTER FOR AGRICULTURE AND LAND AFFAIRS: Chair, it is not about policy. It is about the fact that our people for centuries were denied the opportunity to participate in agriculture. You will remember that when we were schoolgirls, you and me, we were told that the stupid ones must do agriculture and the clever ones must do science – and, of course, everybody did not want to be stupid. There was this view that agriculture is where you work in the mud and work hard in the sun the whole day. Even today most of our youth are not interested in agriculture.

So, it is a huge challenge that we have. It is a legacy of apartheid Bantu education. It is also a legacy of separate development in which blacks were forcefully removed from fertile agricultural land, which is still our pain and the challenge that we have to face today. It is very important, therefore, that we devise these strategic plans in terms of which those that had the opportunity and privilege to have this fertile agricultural land and to be exposed to agriculture through land banks and various schemes – in which they were given loans of 65 years wherein even your grandson could come over and continue on your bond – that those opportunities now be opened up to those who were disadvantaged. Those that were privileged must also be ready to share their skills and their experience and share the land with all the people of South Africa. [Applause.]

Chief B P BIYELA: Chair, I am worried about the cases of blacks that failed to manage their farms. I think the business of failure is not within the blacks who took over. It is the manner in which funding was given to the people. Is it not a fact, hon Minister, that a white farmer was given a large tract of land and was given funds by the government to employ blacks in order to give labour, and that thereafter all the failures, responsibilities and accountability rested on the shoulders of the white farmer? May I ask … [Time expired.]

The HOUSE CHAIRPERSON (Ms C-S Botha): Hon member, your time has expired, I regret, and so has time for questions in general, hon Minister, which excuses you from replying. The time allocated, as I said, has expired and outstanding replies received will be printed in Hansard. See also QUESTIONS AND REPLIES.

                          NOTICE OF MOTION

Mr M WATERS: Chair, I hereby give notice that I shall move on the next sitting day of the House:

That this House debates the senseless and brutal murders of innocent children.

Mr H B CUPIDO: Chairperson, I move without notice that the House …

The ACTING CHIEF WHIP OF THE MAJORITY PARTY: Chair, I beg your pardon, we again have to object. We’ve received one motion without notice concerning which, I think, we communicated to the party concerned that we had a problem with certain aspects. I don’t know if this is a different one, but we’re not aware of any other motions without notice.

The HOUSE CHAIRPERSON (Ms C-S Botha): Thank you, hon Acting Chief Whip. I know this issue of a notice not having been circulated was raised this morning in the Chief Whips’ Forum as a problem. Hon Cupido?

Mr H B CUPIDO: Okay, I shall not move it then.

The HOUSE CHAIRPERSON (Ms C-SBotha): Thank you.

The House adjourned at 17:06. ____

            ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS

TABLINGS

National Assembly and National Council of Provinces

1. The Minister of Finance

   (a) Regulations issued under section 13 of the Small Business Tax Amnesty and Amendment of Taxation Laws Act, 2006 (Act No 9 of 2006), prescribing the circumstances under which the Commissioner may waive any amount of additional tax, penalty or interest payable by specific persons.

2. The Acting Minister of Health

   (a) Strategic Plan of the Department of Health for 2007/08 to 2009/10.

3. The Minister in The Presidency

   (a) Strategic Plan of the Government Communication and Information System (GCIS) for 2007 to 2010.

4. The Minister for Justice and Constitutional Development

   (a) Report on the provisional suspension from office of Mr I X Masimini, an additional magistrate at Queenstown, in terms of section 13(3)(b) of the Magistrates Act, 1993 (Act No 90 of 1993).

   (b) Report on vacancies in the offices of magistrates, in terms of section 9(5)(b) of the Magistrates’ Courts Act, 1944 (Act No 32 of 1944).

5. The Minister of Environmental Affairs and Tourism

   (a) General Notice No 8 published in Government Gazette No 29528 dated 9 January 2007: Extension of the deadline for public comments on the Draft Subsistence and Small-scale Commercial Fisheries Policies, in terms of the Marine Living Resources Act, 1998 (Act No 18 of 1998).

   (b) General Notice No 1832 published in Government Gazette No 29487 dated 12 January 2007: Publication of National Environmental Management: Waste Management Bill – for general comment: National Environmental Management Act, 1998 (Act No 107 of 1998).

   (c) Government Notice No 147 published in Government Gazette No 29647 dated 23 February 2007: Waste tyre Regulations, in terms of the Environment Conservation Act, 1989 (Act No 73 of 1989).

   (d) Government Notice No R.150 published in Government Gazette No 29657 dated 23 February 2007: Commencement of threatened or protected species Regulations, in terms of the National Environmental Management: Biodiversity Act, 2004 (Act No 10 of 2004).

   (e) Government Notice No R.151 published in Government Gazette No 29657 dated 23 February 2007: Publication of lists of critically endangered, endangered, vulnerable and protected species, in terms of the National Environmental Management: Biodiversity Act, 2004 (Act No 10 of 2004).

   f) Government Notice No R.152 published in Government Gazette No 29657 dated 23 February 2007: Threatened or protected species Regulations, in terms of the National Environmental Management: Biodiversity Act, 2004 (Act No 10 of 2004).

National Assembly

1. The Speaker

   (a) The President of the Republic submitted the following letter dated 2 March 2007 to the Speaker of the National Assembly informing members of the Assembly of the employment of the South African National Defence Force in the Republic of Mozambique:

   EMPLOYMENT OF THE SOUTH AFRICAN NATIONAL DEFENCE FORCE FOR SERVICE IN FULFILMENT OF THE INTERNATIONAL OBLIGATIONS OF THE REPUBLIC OF SOUTH AFRICA TOWARDS THE GOVERNMENT OF THE REPUBLIC OF MOZAMBIQUE FOR HUMANITARIAN ASSISTANCE

   This serves to inform the National Assembly that I have authorised the employment of the South African National Defence Force (SANDF) personnel to the Republic of Mozambique, in fulfilment of the international obligations of the Republic of South Africa towards the Republic of Mozambique, for humanitarian assistance in the preservation of life, health and property resulting from the widespread rains that have caused extensive and serious flooding. This employment was authorised in accordance with the provisions of section 201(2)(c) of the Constitution of the Republic of South Africa, 1996, read with section 93 of the Defence Act, 2002 (Act No 42 of 2002).

   A total of one hundred and fifteen (115) SANDF members are employed as from 04 March to 19 April 2007 to provide humanitarian assistance in the preservation of life, health and property resulting from the widespread rains that have caused serious flooding. The Department of Provincial and Local Government (DPLG) will bear the cost of the deployment. The total estimated cost to be borne by the DPLG is R 25, 019, 752. 76.

   I will communicate this report to the members of the National Council of Provinces and wish to request that you bring the contents hereof to the attention of the National Assembly.

   Regards

   Signed

   T M MBEKI

COMMITTEE REPORTS

National Assembly

1. Report of the Portfolio Committee on Finance on the Finance Bill [B5– 2007] (National Assembly – sec 77), dated 14 March 2007:

   The Portfolio Committee on Finance, having considered and examined the Finance Bill [B5– 2007] (National Assembly – sec 77), referred to it and classified by the Joint Tagging Mechanism as a section 77 Bill, reports that it has agreed to the Bill.

2. Report of the Portfolio Committee on Health on Tobacco Products Control Amendment Bill [B24 – 2006] (National Assembly – sec 75), dated 13 March 2007:

   The Portfolio Committee on Health, having considered the subject of the Tobacco Products Control Amendment Bill [B24 – 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 [B24A-2006].