WEDNESDAY, 30 MAY 2007 __

          PROCEEDINGS OF THE NATIONAL COUNCIL OF PROVINCES
                                ____

The Council met at 14:02.

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

ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS – see col 000.

                       WELCOMING OF MINISTERS

The DEPUTY CHAIRPERSON OF THE NCOP (Ms P M Hollander): I would like to welcome the hon Minister of Trade and Industry, the Deputy Minister of Trade and Industry, and also the other Deputy Minister of Trade and Industry. You are all welcome in the House today.

I have also been informed by the Chief Whip’s office that the hon B L Matlhoahela from the ID will not be participating in this debate. So, you can remove her name from the speakers’ list. Sorry, Minister, I should start with the motions. Thank you.

                          NOTICES OF MOTION Mnr J W LE ROUX: Agb Voorsitter, ek gee hiermee kennis dat ek op die volgende sittingsdag sal voorstel:

Dat die Raad kennis neem dat –

(1) op Dinsdag, 29 Mei, twee polisiebeamptes koelbloedig in Kaapstad vermoor is;

(2) sewe lede van die polisiemag die afgelope jaar net in die Wes- Kaap vermoor is;

(3) die moord op polisielede wereldwyd as totaal onaanvaarbaar beskou word;

(4) misdadigers geen respek het vir die lewens van polisiebeamptes nie en duidelik ons strafstelsel minag;

(5) dit duidelik is dat die regering onbevoeg is om polisielede te bemagtig om hulself en die burgers van die land teen geweldsmisdadigers te beskerm; en

(6) geen land met selfrespek hierdie toedrag van sake sal duld nie. (Translation of Afrikaans notice of motion follows.)

[Mr J W LE ROUX: Hon Chairperson, I hereby give notice that at the next sitting I will move:

That the Council notes -

(1) two police officers were murdered in cold blood in Cape Town on Tuesday 29 May;

(2) seven members of the police force have been murdered over the past year in the Western Cape alone;

(3) the murder of police members is regarded as totally unacceptable worldwide;

(4) criminals have no respect for the lives of police officers and are clearly in contempt of our penal system;

(5) it is clear that the government is incapable of empowering police members to protect themselves and the citizens of the country against violent criminals; and

(6) no country with self-respect will tolerate this state of affairs.]

The HOUSE CHAIRPERSON (Mr T S Setona): Chairperson, I just wanted to rise on a procedural order: I am not sure of the extent of the correctness of that motion, in the light of the fact that yesterday, in the same House, a similar motion, substantively and in terms of content, was passed and adopted. I am not sure where, but there is a Rule that says you cannot pass a motion in the same House when a similar motion has been passed within a certain time period. However, Chairperson, you can make a ruling at a later stage on this. Thanks.

Mr J W LE ROUX: Madam Chairperson, yesterday’s motion was a motion of condolence to the families of the police members that were murdered.

Mr M A MZIZI: Chairperson, I hereby give notice that at the next sitting of the House, I shall move on behalf of the IFP:

That the Council –

(1) notes that a 16-year-old rape victim from Umlazi has been kicked out of her home for defying her foster mother, who wanted her to drop the charges;

(2) further notes that it is alleged that the investigating officer in the case also wanted the girl to drop the charges after the suspect had offered to pay compensation;

(3) calls on the Inanda police to investigate the alleged interference of the investigating officer in a criminal investigation; and

(4) reaffirms that rape is a very serious criminal offence and that South African law does not provide for rape charges to be dropped on the promise of compensation to the victim.

                         APPROPRIATION BILL

                           (Policy debate)

Vote No 32 – Trade and Industry:

The MINISTER OF TRADE AND INDUSTRY: Chairperson, I do not know if we have any MECs in attendance here today, hon members, ladies and gentlemen, South Africa’s wealth lies in our diversity, our people and our natural resources. From the sands of the Kalahari - a tourist destination - to the platinum deposits in the North West - which feed the manufacture of catalytic converters - our natural resources contribute to economic development. Indeed, all our provinces have enormous economic potential and it is therefore imperative that we tackle the paradox of the underdevelopment of some regions in our country.

In addressing this challenge, we are well aware of the root causes of the spatial legacy of underdevelopment and that this legacy traps many areas, particularly those in former mining-based areas or in the former homeland areas, in stagnant or low-growth conditions. To solve this challenge of uneven development will therefore require a concerted and co-ordinated local and national effort.

In my address to the National Assembly yesterday, I reported on the positive growth of the South African economy. I also cautioned that we need to develop a deep understanding of the various drivers of this positive growth and, with this understanding, actively intervene to ensure accelerated, shared and sustainable growth across all sectors and provinces.

The Department of Trade and Industry is convinced that an important element in achieving this vision is an active industrial policy. We have observed that a major weakness of the South African economy is the relatively poor performance of nontraditional tradable goods and services in low-skill intensive sectors. And there is a need to address this weakness and the related challenge of unemployment.

We believe that a strong industrial policy is essential in driving the structural diversification of the economy. By this, we are really referring to the fact that the South African economy has continued to be tied inextricably to commodities, and its fortunes, one way or the other, tend to be too closely related to what happens in the area of commodities. This is the reality that we need to systematically transform or change in order to move the economy gradually away from overreliance on what happens in the area of commodities.

However, industrial policy cannot succeed without coherent and simultaneous supporting policies. The most critical of these are a competitive exchange rate, a skills development system which is aligned to our industrial policy priorities, and the traditional and modern infrastructure of the quantum, quality and pricing necessary for our industrialisation needs and a supportive regulatory environment which encourages investment and employment creation among firms of all sizes.

Industrial policy is also the role of the whole of government, including all three spheres. In this regard, we seek to take advantage of ongoing improvement in intragovernmental co-ordination.

Being part of our national economy, our provinces are affected to a great extent by economic activities in the broader economy, including the realignment of the manufacturing sector away from traditional heavy industry input markets and low value-added production towards sophisticated, high value-added production in the agricultural and mineral sectors.

To facilitate the integration of our efforts, regional industrial development is incorporated as an essential element of our industrial policy and we believe that this will enhance the implementation and impact of the National Spatial Development Perspective. We have, therefore, over the past year, been engaged in an extensive consultation process designed to facilitate provincial inputs into our regional industrial development approach.

I am glad to report that the engagement with provinces proved so fruitful that we were able to improve our own approach. While the basic principles of the approach to be taken are not in question, what has emerged is a need to strengthen its planned implementation. In this regard, the issue of development finance, enhancement of support measures such as the industrial developmental zones programmes and a clear indication of proposed priority sectors will be given our co-ordinated attention.

Our experience of this engagement process thus far gives the confidence that the end result will be a much stronger regional development approach, with fewer potential pitfalls in implementation. To this end, we intend to table our regional industrial developmental proposals to Cabinet in due course.

In respect of industrial developmental zones specifically, you will recall that I announced the lifting of the moratorium on the designation of new IDZs in last year’s speech to this House. Since then, the programme has gathered good momentum, to the extent that the DTI has considered extending it, including consideration of proposals from the North West province for the designation of an IDZ next to Mafikeng Airport.

Generally, the developments in three out of the four IDZs that have been designated have been very positive. There are investments that are going into Richards Bay - Tata Steel is going to invest in Richards Bay. The East London IDZ has also registered quite a number of investments. Ngqura is also starting to register quite a number of investments. I think, if people opened this morning’s papers they would have found that that trend is being reinforced. So, the developments have been very good, in relation to IDZs.

To accelerate the implementation of the existing IDZs, the DTI is investigating appropriate co-operation measures by the spheres of government in relation to IDZ companies, including immediate funding and related corporate governance issues. This process is at an advanced stage, with regard to the two Eastern Cape IDZs. The experience from these IDZs will guide us, in relation to other and any future IDZs.

The current proposal, which has been developed on the basis of accumulated experiences of the DTI and our stakeholders, envisages a stronger DTI role in IDZ companies. Parallel to this process, we are developing an IDZ policy which will outline the strategic direction of the IDZ programme as well as provide for IDZ-dedicated legislation. The policy is to be presented to Cabinet in the near future, subsequent to which legislation will be developed.

Similarly, we have already begun to use our available financial resources to more effectively support spatial development. In 2006-07 the Industrial Development Corporation played a key role on a number of fronts. Investment approvals for the financial year are anticipated to be in excess of R5,9 billion and these will support businesses ranging from participation in the Gautrain and the launching of Neotel, to support for small enterprises throughout the country. These investments will have a significant impact on job creation and regional development.

I also reported to the National Assembly that the DTI is acutely aware of the need to broaden participation in the economy and the inclusion of marginalised people, regions and enterprises. In particular, we believe in the potential for small, medium and micro enterprises to contribute to our growing economy and create employment in a geographically dispersed manner.

The Department of Trade and Industry therefore seeks to create an environment where the location of small and medium enterprises is limited only by the location of entrepreneurial spirit. For this reason, the department continues to place great emphasis on the roll-out and effective implementation of programmes for supporting small and medium enterprises.

Access to finance remains a key barrier to entry and is a growth constraint for SMEs. Over the past year, considerable strides have been made in alleviating this constraint. Since May 2005, the SA Microfinance Apex Fund, our microfinance agency, has become operational at national level and has succeeded in disbursing funds to 9 000 savers and 1 700 small and micro enterprises.

In fact, this is the first time in the history of this country that a budding entrepreneur from Middeldrift in the Eastern Cape, Hammanskraal in Gauteng, Ixopo in KwaZulu-Natal, Mathabatha in Limpopo, eMbalenhle in Mpumalanga, Mafikeng in the North West, Phuthaditjhaba in the Free State and Manenberg in the Western Cape has not had to travel long distances for a loan of this nature, because these are services that are increasingly being brought closer to where people are.

In regard to financial support, Khula, through its partners, has facilitated much-needed access to finance for more than 140 000 entrepreneurs. This includes both group and individual beneficiaries. Khula has also signed a revised indemnity agreement with some of the commercial banks, with a view to emphasizing developmental imperatives associated with small business support.

Let me say in this regard that a number like 140 000 sounds like a very big number for this to be financed through Khula. Part of the reason for this is that Khula, because it is not a direct lender, works through a multiplicity of organisations and partnerships and other institutions. By the time some of these things reach the end-user, they do not have that Khula brand attached to them.

So, a lot of the things that are actually happening in the sphere of improving access to finance don’t get given the necessary credit, that it is Khula, because they come through a whole variety of entities. Therefore, I think that part of what we have to address is the branding aspect, because the Small Enterprise Development Agency does have similar partnerships where you have core branding arrangements – a person can always understand that this organisation is in partnership with the Small Enterprise Development Agency.

In the year ahead, in addition to what I have said, to address the limitations of the current Khula model, particularly with regard to the really low end of the market, which is below R250 000, we will be looking at how to respond to this reality that you still are unable and it still is difficult to address this particular market, in spite of everything that is happening in improving access to the finance landscape. So we have to look at how best we can respond to this. Of course, one of the options that we are looking at is whether Khula cannot play a lot more directly in that space. This is one of the things that we are engaging on within government.

We have also continued to assess and improve our non-financial support services and the Small Enterprise Development Agency has made great strides in developing a national footprint. Deputy Minister Thabethe will speak more to this and other issues later on in the debate.

This brings me to the area of broad-based black economic empowerment more generally. As you know, the Codes of Good Practice were gazetted in February this year. In this regard, we note the increase in initiatives by the private sector, which embraces the spirit of the codes, especially in relation to driving preferential procurement and advancing skills development over and above equity ownership.

In the coming year, the DTI will develop the institutional mechanisms for monitoring and evaluating the implementation progress of broad-based black economic empowerment throughout the economy. In addition, the DTI will ramp up its marketing and communication drive, with a view to promoting awareness in the public and private sectors on the implementation of the codes, and thereby enabling the necessary capacity in this regard.

What is important to say here is that we have broadened the scope of empowerment through the Codes of Good Practice, because I think we have firmly stamped what broad-based black economic empowerment is really outlining, all of the different elements, through the Codes of Good Practice. Therefore, any talk that black economic empowerment is really meant for the elite on the basis of the work that we have done on the codes, will not be accurate.

At least, from a policy point of view, it is quite clear that black economic empowerment is about all of these different elements. It is about supporting black-owned, women-owned, small and micro enterprises, in the procurement by companies as well as by government. It is about ensuring that people and companies spend money on training and investing in their own people.

So, it is about all of those different things. Therefore, from a policy point of view, the approach of government must always be clear on what we are talking about when we talk of black economic empowerment.

Given the certainty and impetus the codes have provided, we anticipate that the impact will be felt throughout our entire economy, especially where government procures goods and services or licence operations. Therefore, the first phase of the marketing and communication drive this year will focus on provincial, local and municipal government departments in all nine provinces.

Clearly, the role of provinces in the implementation of the economic transformation agenda is a vital one and we will continue to look for ways of strengthening, co-ordinating and co-operating with provinces, including the Minister and MECs’ forum, MinMec, for the economic sector which we convene periodically.

Hon members, the DTI recognises that consumers with proper information and protected rights are vital for effective markets and overall economic growth. In a process that began some years ago, the department has been undertaking major initiatives to promote consumer protection and awareness of consumer rights to ensure that their interests are protected.

The consultation process and revision of the Draft Consumer Protection Bill approved by Cabinet in November 2005 is now complete. May I take this opportunity to recognise the important role of the provincial consumer affairs offices for their valuable participation in this process, and I am glad to report that they have unanimously welcomed the Bill.

With the rapid advances in technology, we remain vigilant to fronts, opportunities and threats with regard to consumer protection. Internet gambling is one such example. We have therefore received Cabinet approval for the publication of public comment for the National Gambling Amendment Bill.

The Bill aims to provide a lawful basis for the regulation and control of interactive gambling, in the interest of consumers. It also ensures that minors and other vulnerable persons are protected from harmful exposure to gambling. Further, it proposes measures to prevent money-laundering.

I raise this matter here, because provincial licensing authorities were consulted extensively and they have raised certain issues relating to the licensing structure, especially in relation to the proposal that interactive gambling be licensed by the National Gambling Board as opposed to the provincial licensing authorities, as is the case with other forms of gambling.

We believe that this is a matter that can be resolved and the DTI intends to work very closely with the provincial authorities and economic affairs departments to find a solution that serves the interests of all stakeholders, without unduly delaying the tabling of the Bill.

In drawing to a conclusion, I want to say that the DTI recognises the fact that all of the initiatives I have mentioned depend on sound intergovernmental partnership and co-operation. Forging and strengthening ties within government must begin with planning together. In August last year we held a two-day lekgotla with the MECs of economic affairs of different provinces. At that meeting we focused our attention on strategic projects that would have a high impact on the Asgisa goals.

The 12 projects in the work programme are being monitored by our technical MinMec structure, chaired by the Director-General of the Department of Trade and Industry. This will enhance the quality of the projects identified as well as their effective implementation.

Indeed, it has been our experience that engagement with the provinces improves the depth and robustness of our work. It enables the all-important implementation and broadest possible impact of national policies and strategies, such as with regard to transforming the structure of the economy to promote labour absorption and poverty alleviation, in combating regional disparities and ensuring economic inclusiveness by supporting enterprises and protecting consumers.

We also recognise, however, that much of the success of local economic development hinges on locally-led partnerships and initiatives. In this regard, the DTI will play a facilitative and supportive role, and provide appropriate resources in the common pursuit of the objectives of accelerated and shared growth.

I thus ask you to support Vote No 32 for the 2007-08 budget of R4,8 billion. I thank you. [Applause.]

The DEPUTY CHAIRPERSON OF THE NCOP (Ms P M Hollander): I now call upon the hon N D Ntwanambi, Chairperson of the Select Committee on Economic and Foreign Affairs, to continue with the debate. Ms N D NTWANAMBI: Sekela-sihlalo, ndiyabulela ngoba uyakwazi ngoku ukuyibiza ifani yam. [Deputy Chairperson, thank you for being able to pronounce my surname.]

Deputy Chair, hon members and comrades, since our last budget policy debate, a lot has happened. The launch of Seda, the Small Enterprise Development Agency, and other bodies has elevated this country to an even higher position. South Africa is not a junior partner when it comes to issues such as trade and business.

Since 1994, South Africa has experienced strong economic growth. A profound restructuring of the economy has borne fruits in the form of macro-economic stability, booming exports and improved productivity in both capital and labour.

We congratulate you, Comrade Minister, and your department on the growth that our country is enjoying. We have also noted the jobs that have been created with the growth.

Abasebenzi nabo kwelabo icala bayatsho ukuba ukhona wona umahluko kodwa intswela-misebenzi ayehli. Xa sasilungiselela ukulawula ngo-1993, satsho ukuba lixesha lokuba abantu bakuthi babe ngoosomashishini bangabi ngababukeli ngexa kukho abatya inyama behleza amathambo kodwa thina sik wisininzi singaxhamli. (Translation of isiXhosa paragraph follows.) [Labour has admitted that there is a marked improvement although unemployment remains rife. When we were preparing to take over control in 1993, we said that we wanted our people who are in the majority in this country to establish businesses and not become spectators while others become richer day by day.]

We see all of these with the strengthening of the rand …

… nakubeni inamaxesha okwehla. Nditsho kuba kwiminyaka nje elishumi elinesithathu i-ANC ikwazile ukwenza umahluko omkhulu kwezoqoqosho. [… even though it loses value at times. I am saying that because in the thirteen years that the ANC has been in power, it has been able to make a positive impact in the economy.]

I agree with those who say that there is a realisation that the global market is a competitive place to be in. South Africa enjoys trading partnerships throughout the world. That’s why we must create in our country a clear and consistent message that emphasises distinction and attractiveness in relation to the obvious appeal of the global giants.

Again I must commend you, Mr Minister, and your department for resuscitating the textile industry, particularly in Cape Town.

Abantu abathetha isiZulu bathi ixoxo nexoxo liyazigxumela, ngoko ke nam kufuneka ndithethelele iKapa. [Zulu-speaking people have an idiom that goes: every man for himself. Therefore, I find it proper and necessary that I should do the same for Cape Town.]

Many women in this city work in this industry.

Ndiyazi ukuba iimpahla ezivela eTshayina ziza ngexabiso elingelikhulu koosomashishini beli. Kambe kubalulekile ukuba iqiniswe intengo apha eMzantsi Afrika.

Mphathiswa, bendiza kubuza ukuba kunganjani na xa iimpahla ezithinjiweyo bezinokusiwa kumakhaya agcina abangaphilanga nalawo agcina iinkedama? (Translation of isiXhosa paragraphs follows.)

[I know that businesses buy imported clothing from China at a very cheap price. It is, however, important that we buy locally manufactured clothing.

Minister, I was wondering whether we should not consider donating impounded items to homes for sick children and to orphanages?]

The International Investment Council encourages South Africa to be bolder and more confident in setting growth targets and in marketing its economy successfully.

Unxibelelwano phakathi kweli sebe nelo lijongene nemicimbi yangaphandle luthi lubonakale ngendlela abantu bamanye amazwe abeza ngayo apha eMzantsi Afrika. Ndiyonqena ukuphinda amazwi abesele ewathethile uMphathiswa.

Mphathiswa nesebe lakho, apha ekhaya kuza kubaluleka nangakumbi ukukhulisa ookopolotyeni abasakhasayo. Ndiyazi ukuba amafama amhlophe kudala aba nabo kuzo zonke iidolophu nokuba zingancinci kangakanani. Kambe nanjengoko injongo karhulumente ikukuvala umsantsa phakathi kwabo babexhamla ngaphambili kunye nabo baqalayo ukuba ngoosomashishini, yenzani nangaphezu kokuba nisenza. Siyawubona umahluko, ntonje sifuna omkhulu nangaphezulu ngoku.

Eyona nkxaso mayibe yileyo ijoliswe kumakhosikazi, ngakumbi phaya ezilalini. Ndikhulele kwindawo eyayinoozenzele kudala. Mhlawumbi leyo yenye yeendlela ebiya kuncedisa ekuboneni ukuba amakhosikazi asezilalini akwazi ukusebenzisana anyusane de nawo arhwebelane namazwe angaphandle.

Ngexa i-NCOP yayiye kwiphondo laseFreyistata, sabona indlela azama ngayo urhulumente ukuzi xhasa ezi mbono. Kambe abaqeshwa bakarhulumente bafaka imali nje bangalandeli ukuba kwenzeka ntoni na. Mthembu, ndiphakamisa ukuba uwalandele amaphondo ngelokufuna ukuqonda ukuba enza ntoni na.

Ndiqinisekile ukuba le Ndlu ikunxanelwe ukwazi ukuba ngoku iingxoxo zeDOHA ne-WTO zikweliphi iqondo. Ngaba ikhona na into ethi urhwebo lwethu ma- Afrika luza kukhula ngamandla? Ikomiti yethu inomdla kakhulu kurhwebelwano lwethu apha eAfrika kuqala, ze kamva siphumele nga phandle. Nditsho kuba ndiyayazi indlela eyijongela phantsi ngayo le Doha Development Round i-EU kwi-WTO. Kwelinye icala, bayaziqinisa ngokukhulisa urhwebo lwabo lwaseYurophu, ze kwelinye bavingce kungangeni nentwala le eza kuphazamisa olwabo urhwebo.

Mandigqibizele ngelithi siyanqwena ukuba izindululo zeNgqungquthela yaseMaseru zibe neziphumo ezizizo nanjengoko sekusele nje iinyanga ezintlanu. UMzantsi Afrika unoxanduva lokuqinisekisa ukuba lo mmandla wasemazantsi uyaphumelela kwezoqoqosho ukuze kube kho uzinzo kwezopolitiko nezentlalo.

Mphathiswa namasekela akho, ndifuna ukuthi ngabamfameke ngengqondo abangayi kuvota nathi bevotela ukuba olu hlahlo lwabiwo-mali lwamkelwe. Thina siyi- ANC siyaluxhasa. Enkosi kakhulu. [Kwaqhwatywa.] (Translation of isiXhosa paragraphs follows.)

[Communication between this department and the Department of Foreign Affairs can only be measured by the number of foreigners that visit South Africa. I do not want to repeat what the Minister has already said.

Minister and your department, it is going to be more crucial to support emerging co-operatives. I know that white farmers have always had these in each and every town no matter how small they might be. Government’s aim is to eradicate poverty, thus we appeal to you to work harder to close the gap between those who were privileged before and those who are small and emerging businesses. We can see the difference, but we want you to work even harder.

More support needs to be given to women, especially those in rural areas. I grew up in an area where there were self-help women’s organisations known as the Zenzele clubs. Perhaps that is one of the ways of testing whether women from rural areas can work together to an extent that they establish trade links and export goods that they have produced.

When the NCOP was sitting in the Free State we clearly saw how the government is trying to support these aims. We also saw that public servants allocate funds to programmes and do not make follow-ups. Son of the Thembus, I suggest that you check what the provinces are doing.

I am sure that this House is eager to know how the Doha and WTO negotiations are going at this moment. Is there an indication that our trade is growing fast? Our committee is very interested in the establishment of trade relations between African countries first and with overseas countries later. I am saying this because I am aware of how the EU in the WTO looks down on the Doha Development Round. On the other hand, EU countries are strengthening trade relations with one another whilst closing ranks to anything that could disturb their trade. In conclusion, let me say that we wish that the resolutions adopted at the convention in Maseru could be implemented. South Africa has a responsibility to ensure that the economy of Southern Africa grows in order that there is socio-political stability in the region.

Minister and your Deputies, I want to say that it is only mentally challenged people who would not support this Budget Vote. The ANC supports it. Thank you. [Applause.]]

Ms S H CHEN: Hon Deputy Chairperson, as our Chairperson always encourages us to use our mother tongue, I deliver this speech in Chinese? [Laughter.] I’m just joking.

Hon Minister and both our hon Deputy Ministers and all my colleagues, today we are debating the DTI’s budget and I’m sure our hon Minister has received much constructive criticism recently from my colleagues in the House of the National Assembly. I will therefore not repeat those concerns again. I would, however, like to share a story with the Minister concerning the DTI’s policies.

One month ago, whilst on a plane to Cape Town, I sat next to a businessman who owns a factory that manufactures bed linen for the local market. He sadly told me that he had recently had to close down his factory that employed more than 200 workers. I was horrified and asked him the reasons for such a drastic action. He informed me that, owing to the new textile quota restrictions, he was no longer able to import sufficient material for manufacturing and that the local market did not have the capacity to produce the material required in order to keep his business afloat. In addition, because there are no quotas on finished products, he has therefore resorted to importing complete manufactured linen to sell to the local market. This forced him, with great reluctance and sadness, to put over 200 employees out of work.

I am sure this is not the only case that has been brought to our attention. The above story highlights the importance of careful planning and comprehensive research regarding any policy. Instead of only trying to improve local manufacturing from a single perspective, we should rather see the bigger picture and tackle the problem from all sides, with improving and increasing competition as the end goal. This would be a more sustainable and productive strategy that provides better opportunities and clearer vision. We are currently a consumer-driven rather than a manufacturer-driven economy, and we desperately need to take steps to alter this situation, so as to ensure the sustainability of our economy in future.

I would like to point out that at times policies are implemented without careful consideration of their full impact throughout the whole economy. Much effort is put into developing a policy, and implementation without a comprehensive impact survey will result in the policy having to be revoked, altered, and reimplemented in future at additional cost - such as our BEE policy. It also causes much irreversible damage to our economy.

Although the Minister is not the implementer, he should nevertheless delegate appropriate responsibility and establish necessary steps to be taken to ensure that policies are rolled out in such a manner as to do as little harm as possible to the current economy. We are still experiencing the problem of understaffed departments and vacant positions within our government institutions. It is vital that these positions are given to capable and enthusiastic applicants with sufficient and relevant qualifications. Merely filling posts to use up funds will only ensure loss of control and poor productivity.

Each Act, Bill and policy that is passed and implemented, surely, has the best of intentions with the best interest of the consumer and economy at heart. However, accountability and responsibility need to play a vital role in each implementation. For example, the incorrect issuing of liquor licences in inappropriate areas can cause serious crime hotspots that will be destructive to our society and youth. Therefore, a small mistake such as this can have a disastrous impact on our community and people, and must be avoided through effective planning and oversight. This can only be achieved via a sound framework from our regulators and officials.

We would all very much like to achieve the goal set by Asgisa. To bring unemployment below 15% by 2014, we need to take action to promote small and medium enterprise development. We need to produce a national industrial policy framework, especially in our rural areas.

The HOUSE CHAIRPERSON (Mr T S Setona): Hon member, please take your seat. Are you rising on a point of order, hon Chief Whip?

The CHIEF WHIP OF THE COUNCIL: No, it’s not a point of order. The Rules allow that we may pose questions. Is the member bold enough to take a question on the criticism she made on the BEE policy?

Ms S H CHEN: I must apologise, Chief Whip, because I am now concluding. Can I …

The HOUSE CHAIRPERSON (Mr T S Setona): Hon member, you must address the other member through me.

Ms S H CHEN: Through you, Chairperson?

The HOUSE CHAIRPERSON (Mr T S Setona): Yes. So, are you not in a position to take a question?

Ms S H CHEN: No, thank you. The HOUSE CHAIRPERSON (Mr T S Setona): Ok, she is not in a position to take a question. You can continue, hon member.

Ms S H CHEN: Thank you. In conclusion, I would like to urge our hon Minister and all our officials to keep the people and their needs close to their hearts, and to remember your passion in wanting to make a difference in South Africa by helping to achieve a better life for all and taking South Africa forward into a prosperous future. I thank you! [Applause.]

The DEPUTY MINISTER OF TRADE AND INDUSTRY (Dr R H Davies): Chairperson, hon members, I think the Minister will have an opportunity and more time than me to respond to some of the points that were raised by hon Chen. However, I would just like her to consider this: While 200 jobs may be lost - according to the anecdote she presented to us - how many hundreds of jobs were actually saved and how many new jobs were created through the deals which have been struck as a result of the quotas and the modification of the quotas, and through the deals between retailers and local manufacturers? I don’t think that there is any way that she can sustain her argument which suggests that the quota agreement was not well-thought-out in its implementation.

This Council has unique responsibilities and perspectives, which means that its oversight over national government departments is of a different order and different character from that of the other House in the national Parliament. As hon members know, the Constitution gives our provinces considerable powers in the areas of trade and the promotion of economic development. While our provinces have MECs and departments responsible for economic development, our municipalities likewise have powers and responsibilities for local economic development, particularly through the formulation and implementation of integrated development programmes.

Our Constitution also entrenches the principle of co-operative governance, requiring that all three spheres of government work together to ensure coherence and complementarity. The NCOP is thus in a unique position to oversee the big picture of the relationship between the efforts of the three spheres of government, in this case the areas of trade and industry.

This year has seen an advancement of our work on industrial policy at national level. We have announced that, within the very near future, we will publish the industrial policy framework document along with an industrial policy action plan for the current fiscal year. The mandate for the current year’s industrial policy action plan derives from the President’s state of the nation address, where he indicated that action programmes will be formulated and implemented for a number of specific sectors that he outlined.

Essentially, what we have done is to drill down into the customised sector programmes in various stages of development in the named sectors and identified all the low-hanging-fruit initiatives recommended in the key action plans that we can move towards implementing quickly and within available budgetary resources. This year’s IPAP will thus outline a fairly broad range of actions across a diverse range of sectors.

However, the industrial policy framework document indicates that we intend moving towards making industrial policy interventions on a larger scale, sufficient to strategically influence the direction of industrial development in this country and also to make support measures available more conditionally. This means that, even as we finalise this year’s industrial policy action plan, we are beginning to work on future IPAPs that will differ significantly from the current year’s one.

Essentially, making larger scale interventions requires that we engage with some of the big-ticket recommendations in customised sector programmes and this will inevitably require greater choice sequencing and prioritisation. Future IPAPs should therefore be expected to focus on a smaller number of larger interventions and focused on a smaller number of sectors than this year’s.

One priority that has already emerged is a capital goods industry capable of producing inputs for a very significant infrastructure development programme that is already under way. We need to ensure that a significant portion of the various items that will be procured by infrastructure development projects are in fact manufactured in South Africa and that we, therefore, use the infrastructure development programme as a tool of industrial development.

This will require that we drill down further and identify particular capabilities in this area that we now have or have had in the past, as well as other strategic inputs which we can produce, whose continued reliance on foreign supplies will be problematic for one reason or another. We then need to identify what is required to promote the production of such capital goods in South Africa.

In this work, we will be working closely with the Department of Public Enterprises’ supplier development programme to identify the prospects for promoting offsetting foreign investment in targeted capital goods areas. Beyond this, ongoing work will identify the criteria for the selection of other new priority sectors.

At the same time, as our work at national level on industrial policy has been progressing, each of our provinces have simultaneously developed their own growth and development programmes. Most of these have identified sectors where provinces believe they have a comparative advantage or could create competitive advantages. Municipalities, through IDP processes, have likewise identified priority areas, in some cases in close collaboration with provinces.

A major challenge, as we move into the next phase of industrial policy work involving, as I indicated, greater prioritisation and selectivity, is to ensure that there is alignment and coherence between the priorities that have emerged from the work that has taken place at the level of all three spheres of government. It makes no sense for a province or municipality to be pursuing a priority that is not championed at national level and vice versa.

A further challenge will be to locate our industrial policy within the spatial development perspective. We all know, despite significantly improved economic growth that has taken place in recent years, that significant disparities persist and may even have been exacerbated in small towns and rural areas. Unless we act decisively, we could be in danger of further polarising our economy with dominant enclaves, well connected to the global economy and advancing, while areas marginalised by apartheid become further isolated as wealth and employment disparities increase.

The key policy pronouncement in this regard is the National Spatial Development Perspective. The National Spatial Development Perspective has identified various categories of development potential in the space economy of the country and has laid the foundation for determining guidelines and interventions appropriate to meeting the different development needs of the various economic regions of South Africa.

One of the principles identified in the National Spatial Development Perspective is that, beyond the constitutional obligation to provide basic services to all citizens wherever they reside, I quote, “Government spending on fixed investment should be focused on the localities of economic growth and/or economic potential.” The NSDP is thus forcing all of us to confront some hard questions. Do regionally specific plans and proposals have real prospects or are they just wish lists? If proposals have real prospects, what do we all need to do to ensure more equitable but also realistic spatial economic development? How do we deal with competing projects that may have emerged from provincial and local government processes?

A strategic conversation on some of these issues has begun, but only just begun, at Minmec level. We have agreed on the need to develop a three-year Minmec workplan focusing on high-impact priorities. To this end, we have begun to engage with the 174 or so provincial projects identified in provincial growth development summit processes with a view to identifying between 10 and 15 that will be the focus of more substantive interventions.

In this process we have agreed that there will be at least one such project in each of the nine provinces. As the DTI, we have proposed 12 such projects and are awaiting suggested amendments to this list from the provinces.

The DTI is, in the meantime, finalising a new regional industrial development strategy which we hope to table soon. The regional industrial development strategies will specifically seek to address spatial constraints and opportunities related to industrial development programmes, at municipal level.

Finally, we are in the process of reviewing industrial development zones, not with a view to changing the basic concept underlying them but in order to improve their effectiveness as a means of attracting investment. As I indicated earlier, at executive level, we have only begun our strategic conversation on some of the critical issues arising from the imperative to promote more equitable spatial and economic development. I would respectfully suggest that this Council might find it worthwhile also to engage on some of these critical questions.

It’s pleasing to note, as the hon Ntwanambi highlighted in her speech, that the NCOP continues to take an active interest in trade policy issues. As I indicated in my speech in the National Assembly yesterday, this year will see three very critical trade negotiation processes come to a head, one way or another, with implications for all of us. The first of these is the WTO round of negotiations, where there are some intensive efforts being made to try to conclude the round before the end of this year. Many complicated issues with great implications arise from this process.

The second of these is the negotiation of economic partnership agreements between the African, Caribbean and Pacific regions and the European Union. The third is the SADC regional integration agenda, particularly the debate on moving to a customs union.

I have focused on just some areas of the work of the DTI through which I think we can all benefit from a deeper engagement with members of this Council and the select committee in particular. I look forward to our having those opportunities in the near future and I have pleasure in commending Budget Vote No 32 to this Council. I thank you. [Applause.]

Mr Z S KOLWENI: Chairperson, taking the platform after such a speculative speech - I think the Deputy Minister has diagnosed my speech and he offered a few answers.

Hon Chairperson, Minister, Deputy Ministers and my colleagues, today we are here to process the Department of Trade and Industry’s budget. This is the department that, at times, we expect to put on a cap as an ambassador in the global village. No wonder our committee had to believe it when it prefaced its presentation on the 23rd with these two sentences, and I quote:

South Africa has registered a change in economy towards a higher growth path, well established with GDP growth of 5% in 2006. Key drivers have been robust consumer spending and increased fixed investment by both public and private sector.

I definitely agree that the confidence in our politically stable country is a reality. You witness this yourselves, members, as you travel countrywide. There are pockets of enterprise projects to an extent that the country is now experiencing a shortage of cement, because of the level of consumption that suddenly jumped beyond expectations. However, employment opportunities remain a challenge in this growing economy.

My select committee, though, is more interested in provincial economic growth, hence it places more emphasis on urging the department to develop monitoring and evaluation tools for DTI provincial pillars like Seda – the Small Enterprise Development Agency - and Samaf – the SA Micro-Finance Apex Fund - offices across provinces. We are saying that, much as the DTI is able to track national Cabinet lekgotla priorities, equally so these must turn into provincial growth and development strategies, and trickle down to the level of local government, where we have local economic development offices.

As we have been echoing the chorus that the DTI must come home, we have really meant it. Yes, we welcome the Accelerated and Shared Growth Initiative for South Africa initiatives in identifying the need to develop and promote a robust industrial policy, where it flagged deliverables like IDC-approved investments with capital injections that will be focusing on driving co-operatives in those identified provinces where youth and women will be the main beneficiaries. I am also impressed because I have learnt from the Minister that Mafikeng is also one of those places that will be benefiting.

Another interesting feature is that Khula is likely to become directly involved in disbursing loans, provided our Vukuzenzele Community Enterprise innovations will not be trapped in a credit-worthiness screening threshold, because the government has been reluctant to embark on a blanket credit amnesty.

We have reason to be impressed and convinced that this department is doing sterling work abroad and at home. When we view a project like Coega, not to mention the support that was dedicated to the film industry which successfully delivered a South African niche film called Tsotsi, all we need to say, and say it loudly, is: Forward with the vote of confidence in the DTI, forward! Thank you. [Applause.]

The DEPUTY MINISTER OF TRADE AND INDUSTRY (Ms E Thabethe): Chairperson, hon members of the Council, guests, ladies and gentlemen, as I indicated yesterday in the National Assembly, this Budget Vote takes place during a significant month. As you know, on 1 May we were celebrating Workers Day, not only in South Africa, but it was celebrated worldwide by workers. Those who are Christians or who come from the Christian faith celebrated Ascension Day on 17 May and Africa Day is also celebrated on 25 May. So this month is very important to us.

I would also like to mention that on Thursday, 24 May, Cell-C, in partnership with the Department of Trade and Industry, through the gender and empowerment unit, were able to celebrate the occasion of “Take a girl- child to work day”. We took about 50 students to the DTI campus so that they could learn about what it is that we do every day there and aspire to become economists, directors-general and Ministers of Trade and Industry in future.

When we did that, we went to North West province. We did not only do this in Gauteng, Pretoria, but went to North West from 10 to 20 May. That is where we ran an entrepreneurship camp and took about 100 girl-learners from the best schools in North West province – hon Kolweni. We ran a competition and those who won the first prize were with us yesterday, during the Budget Vote debate in Committee Room E249.

For the first time, those learners experienced the Mother City and were part of the Budget Vote. We are making sure that we bring the DTI or take it to the people and also making sure that learners can come here and see what we do. Those are future entrepreneurs, hon Chair. I think they can teach you a lesson as well as to what black empowerment is all about. They are much more experienced in terms of understanding that. [Interjections.]

There is no confusion. It’s clear, we want to transform the economy. Hence we have the Codes of Good Practice. There was wide consultation and I am also sure that that member took part, as a businesswoman. Regarding some of the debates, I think you are talking for yourself as a businesswoman, under the pretext of talking for the people. [Laughter.] It’s your right to do that but you must do research and be able to deal with the facts and not come to attack here. [Interjections.]

The HOUSE CHAIRPERSON (Mr T S Setona): Hon members, can you allow the Deputy Minister to proceed with her speech.

The DEPUTY MINISTER OF TRADE AND INDUSTRY (Ms E Thabethe): Of course, one of the challenges that those aspirant entrepreneurs will one day have to deal with is the question of access to finance and the assistance that we can bring. Surely, that’s why we have the strategic framework on gender and empowerment to assist there.

We also need to look at the techno girls who will be women of business tomorrow and also make sure that they can contribute to our economic framework and share in the growth of this economy. So in the DTI we don’t just talk, we act. That’s why even outside here, if you look at the exhibition you will observe the focus on entrepreneurs who were assisted by DTI agencies, such as the Small Enterprise Development Agency, the IDC etc. You can see that they produce good stuff.

We also took them through Seda technology to make sure that they can compete and that those things that they sell are of good quality. We did that through the Department of Trade and Industry, of course, led by Minister Mpahlwa.

At times, we don’t just like to debate forever, we act and really make sure that we empower people. I also believe that if this strategy can go ahead, it will assist a lot of women who continue to experience problems when they want to access finance to grow their businesses.

Regarding SMMEs, as the Minister indicated, we are looking at the whole comprehensive strategy to establish what it is that we can do. Also, we try to implement as we go along and refine, as per the integrated strategy adopted by Cabinet in 2005.

Regarding co-operatives, we are also in the process of making sure that we complete the regulations and are able to move on. We have started to implement as well. Today we have assisted many co-operatives. In 2006 alone, the DTI managed to provide financial assistance to 16 co-operatives from 6 different provinces, that is Eastern Cape, KwaZulu-Natal, Gauteng, North West, Northern Cape and Limpopo. Support for these entities was in the amount of R3,78 million and benefited 205 youth and 188 women. In addition, four co-operative special projects were supported in the amount of R8,94 million.

We also have partnership with Meropa Heritage in terms of making sure that the Jobs for Growth Programme can be a success. Members would know that we are serious in making sure that we empower our people who are in the second economy, hence the codes are also part of the contribution.

Regarding Free State, the Chair indicated that we visited the province. The Chairperson of this House, hon Mahlangu, invited me to go with him, together with the MEC for economic and environmental affairs, Neo Masithela. We went there. We have already started processes. Seda is on top of the issues there. They are assisting those identified co-operatives and stokvels that exist in that area. So we really implement, we don’t just talk. We go there and act, because we believe that we will deal with poverty in this country in that fashion.

In terms of our principles, we believe that we are on the right track. Minister, I think we will be able to drive this department and make sure that we deal with our mandate.

In conclusion, I am sure you all know that the Freedom Charter was adopted in 1956 at the Congress of the People in Kliptown. One of the clauses said, “The people shall share in the country’s wealth.” I further quote from the charter:

All people shall have equal rights to trade where they choose, to manufacture and to enter all trades, crafts and professions.

Therefore, in the spirit of the Freedom Charter, I think we are implementing it - as I told you. Outside here, you will see beneficiaries of some of our agencies. Our agencies are assisting them to make sure that they can create jobs and can be good men and women who contribute to our GDP, and make sure that South Africa is a country to be reckoned with. We will continue bringing the DTI to the people to make sure that we can empower as many of our people as possible.

I believe that we will do this together with yourselves, committed business, labour and communities, to ensure that the needs of the economically disempowered are addressed, and to make sure that we can really transform this economy to the benefit of the majority of the people, who had never experienced any economically active life because of being marginalised and left in the second economy.

We will continue with our izimbizo programmes and make sure that we go to these areas that are rural and semi-rural and preach what our agencies are doing. We also listened to people in provinces such as Northern Cape and Eastern Cape – at Masele, where we were recently in April. We listened to them and then established what the challenges are.

Working with the Eastern Cape Development Corporation and local development forums, we will make sure that we deal with the question of small business and co-operatives in a comprehensive manner. For sure, that is why it is good to be led by the ANC-led government, because they know exactly what it is that people need. They even assist people from the DA, hon Chair. We don’t ask them for membership, but we look at their business plans and assist them because we believe this economy must be shared by all. Thank you very much.

Ms M P THEMBA: Chairperson, hon Minister, hon Deputy Ministers Thabethe and Davies, colleagues, comrades and friends …

… ngifuna kusho nje kutsi tsine asetfuswa ngumuntfu lotsi nakeve emahemuhemu bese utawuma la kulephodiyamu, atesitjela ngemvabetsi, ibe kantsi ngetikhatsi letinyenti yena akabikhona nekubakhona emihlanganweni yekomidi. Sikhatsi lesinyenti usuke aye kumabhizinisi akhe ngesheya. (Translation of Siswati paragraph follows.)

[… I just want to say that we will not be intimidated by someone who listens to rumours and then has the audacity to stand on this podium and tell us about what he himself knows nothing about because he does not even attend committee meetings but prefers to use the time for private business matters overseas.]

Women bear the biggest brunt of poverty. The Beijing Platform for Action urged the international community in all sectors to, amongst others, shape macroeconomic policies and development strategies to address the needs and efforts of women in poverty, revise laws and administrative practices to ensure women’s equal rights and access to economic resources, and to give women access to banking, savings and credit mechanisms and institutions.

The ANC-led government embraces the sentiments of the Beijing Platform for Action. Indeed, we cannot speak of advancing the national democratic revolution without seriously addressing the economic empowerment of women. Whilst the quality of life of women has improved dramatically post-1994, the recently released labour force survey indicates that we have yet to break the apartheid-inherited shackles of triple oppression, which is a contrast to our philosophical belief in the principle of equality and equal opportunities.

The role of the Department of Trade and Industry, the DTI, in chiselling away these shackles is particularly noteworthy. The DTI programmes to accelerate the economic emancipation of the bosom of our nation are amongst the best in the world. I think here specifically of programmes such as the SA Women Entrepreneurs Network, known as Sawen, and Technology for Women in Business, known as Twib.

The department recognised that there was a need for an organisation to support women in business to provide for networking and to help them overcome the obstacles they faced and Sawen was born. This structure is now flourishing and we are seeing greater linkages being forged between women in business.

Just over eight years ago, the department recognised the need to encourage women to use technology and science in business, and Twib emerged. The annual Twib awards are becoming sought-after events which are stimulating groundbreaking applications of technology within small and micro enterprises.

It is encouraging that a directory of women’s businesses and a fund specifically for the use of women-owned businesses are in the process of being established. It is also pleasing that the very vibrant gender unit at the Department of Trade and Industry not only addresses gender empowerment at societal level, but ensures gender mainstreaming within the programmes of the department. It is clear that this department has gone a long way in respect of implementing the Beijing declaration and making business ownership more possible for women.

A gap still exists, though, in respect of the youth. While the department is working closely with the Umsobomvu Youth Fund and is an active contributor to the Joint Initiative on Priority Skills Acquisition, known as Jipsa, a dedicated unit has to be established to fully develop the entrepreneurial potential of resourceful, innovative young minds.

The labour force survey indicates that a third of the unemployed are between the ages of 15 and 24, and almost 40% are between the ages of 25 and 34. The fact that an estimated 70% of unemployed are young people means that interventions specifically tailored to the needs of the youth are required. Innovation is the future. Economic growth and global leadership require original thinking. The youth are the pioneers of fresh thoughts, and it is thought and energy that will drive our economy into a higher platform of international engagement.

Captivating, driving and channelling this latent potential should not only be the responsibility of the Department of Trade and Industry, it should also be the responsibility of DTI agencies. Access to start-up and floating capital is the major impediment to enterprise sustainability. The five development finance institutions, namely the Industrial Development Corporation, Khula, the National Empowerment Fund, the Export Credit Insurance Corporation and the SA Micro-Finance Apex Fund can all contribute to the development of youth-owned enterprises at different levels. Skills development and product quality are also essentials for every successful business. Guidance and support from specialised agencies such as the SA Bureau of Standards, the SA National Accreditation System, and the SA Quality Institute for Young Business Owners are required. Likewise, the Small Enterprise Development Agency should consider creative ways of stimulating an entrepreneurial culture amongst our youth.

While women and young people are very important economic citizens, the department also has to ensure that industries and the economy are serviced as a whole. The 18 agencies that form part of the DTI group, some of which have already been mentioned, are fundamental to enabling the department to achieve its goals and objectives. Thus far, the department has been performing very well. I have no doubt that the DTI’s activities have contributed to the positive economic growth of around 5% that the country is currently enjoying.

The second-economy-specific activities such as support for small, micro and co-operative enterprises, sharpening the instruments for broad-based black economic empowerment, increasing consumer protection and instituting a strong industrial policy all contribute to broadening the base of economic participation and ultimately an increase in the gross domestic product.

This element of shared growth is an important one. Economic growth has to be coupled with poverty eradication and job creation. We, however, also want to encourage the emergence of an alternative attitude towards business, an attitude that transcends individualism and greed, towards values of solidarity and ubuntu.

Co-operatives are instrumental, as has already been mentioned, in shaping an alternative economic value system, as they are underpinned by principles such as voluntary and open membership, democratic member control, co- operation and concern for the community. The co-operative model, while having a more collective approach to business, does not mean sub-standard quality. Through its comparative advantage of economies of scale, synergies, increased bargaining powers, joint innovations, members’ involvement and stability, it can enhance small business competitiveness nationally and globally.

The constructive contribution of the department has been enhanced by the fact that its activities are aligned with the activities of the DTI group. The shared service delivery model within the DTI and its group of agencies will focus the resource across the group even further and thereby strengthen the impact of the organisation.

In conclusion, the country is depending on the DTI to be instrumental in achieving the objectives of halving poverty and unemployment by the year

1. In order to meet our very high expectations, accordingly, the department has to be appropriately funded. The ANC therefore supports the budget. I thank you. [Applause.]

Mr H PAPO (Gauteng): Chairperson, I need to just indicate to the hon members that our MEC, hon Mashatile, had a number of pressing tasks which he had to perform in our province, because he is also an MEC for three departments, that is treasury, economic development and the Gauteng Shared Services Centre. So, there are a number of tasks he had to perform, which were indicated to the Council.

Our chairperson, hon Gungubele, is writing exams and he will be back in the committee in the first week of June. He is trying to complete his BCom Law this year, so he is busy with exams. Anyway, because we work as a collective, the MEC indicated that we should wish the Minister, Deputy Ministers and the Council success in this policy debate.

Hon Chairperson and Deputy Chairperson in absentia, hon Minister of Trade and Industry, Comrade Mandisi Mpahlwa, hon Deputy Ministers Elizabeth Thabethe and Rob Davies, members of the Council, representatives of local government, the central challenge facing us as government in the second decade of freedom is to defeat poverty and substantially reduce the level of unemployment.

In response to this challenge, the ANC’s vision for 2014 identified a number of milestones which we must achieve as we advance towards the end of the second decade of freedom in 2014. These milestones include the reduction of poverty and unemployment by half, and the provision of skills required by the economy. The achievement of these milestones is at the centre of our programme to build a better life for all and to reverse the legacy of our unhappy past.

In Gauteng, we take pride in the progress we continue to make in deepening the gains of freedom and putting in place the building blocks of a better Gauteng. Our midterm report, which we have made public and which is on the website of our provincial government, indicates that we have made significant progress in achieving the goals we have set for ourselves and responding to the genuine aspirations of our people.

As our Premier, Mbhazima Shilowa, indicated in his state of the province address earlier this year, a number of key economic and development indicators show that we are succeeding in changing the lives of our people for the better. The number of people living below the poverty line in our province declined from 8,4% in 2001 to 7,3% in 2002. Average per capita income grew significantly from R28 926 in 2000 to R50 911 in 2006. This represents a massive 75,8% increase.

Gauteng continues to be the economic engine of South Africa and plays a significant role in the economies of both the Southern African region and the African continent. We are succeeding in positioning Gauteng as a preferred destination for local and international investment. Our economic agency, the Gauteng Economic Development Agency, which, among others, is responsible for facilitating investment in Gauteng, has thus far attracted a cumulative investment of more than R5,1 billion into the provincial economy.

Furthermore, and in line with the trend nationally, the provincial economy continues its strong growth. Between 2000 and 2005 the provincial economy grew at an average rate of 3,8% per annum. According to Stats SA, the provincial economy grew at a rate of 5,4% in 2005. One of the major benefits of this growth has been job creation. A total of 462 000 new employment opportunities were created in the Gauteng economy, confirming our assertion that we are indeed beginning to make a dent in unemployment.

Going forward, we will sustain our achievements and ensure that they are elevated to higher levels. Our objective is to achieve a provincial economic growth rate of 8% by 2014. In order to achieve our objectives, the focus will shift to infrastructure development, accelerating the implementation of the provincial growth and development strategy and building the capacity of the state.

Over the next three years we will, together with local government, spend more than R50 billion in improving the infrastructure across the province. This massive injection into the provincial economy will lead to job creation and contribute to economic growth and the creation of new nodes of economic activity.

We’ll also pay attention to monitoring the implementation of the provincial broad-based black economic empowerment strategy and strengthen the support we are offering to small, medium and micro enterprises, co-operatives and other forms of collective ownership. This we’ll do as part of our targeted interventions aimed at addressing the challenges of the second economy.

We’ll be embarking on a massive roll-out of information and communication technology infrastructure as part of our efforts to reduce the cost of doing business in our province. In order to intensify the implementation of the provincial growth and development strategy, we’ll continue to stimulate sectors that will contribute to accelerated economic growth and job creation. The sectors will focus on tourism, value-added manufacturing, information and communication technology, the creative industry and agroprocessing. As we support these sectors, we’ll ensure that we focus on achieving high levels of labour absorption.

The involvement of all stakeholders, including the private sector, is critical to the successful implementation of the provincial growth and development strategy. It is for this reason that last year we launched the provincial growth and development strategy forum representing all stakeholders in the provincial economy. This forum will monitor the implementation of the GDS and offer advice on how to accelerate its implementation.

Central to the path we have crafted for ourselves as we endeavour to elevate our gains to an even higher level is the need to strengthen efforts aimed at positioning Gauteng as a competitive city-region. Local government in Gauteng and the provincial government have committed themselves to pursue a vision of a Gauteng City-Region that is globally competitive. This vision requires of us, as various spheres of government, to work together towards common objectives. It requires of us to strengthen intergovernmental planning, co-ordination and implementation.

The pursuit of this vision is central to our overall objective of achieving higher levels of economic growth, job creation and promoting even and balanced development. By pursuing this vision, we’ll ensure that we combine resources as various spheres of government, so that our collective interventions can deliver maximum impact in the shortest time possible.

We are encouraged that signs are emerging and that there is growing co- operation between the provincial government and municipalities. This can be seen from infrastructure roll-out projects undertaken jointly by municipalities and the provincial government. These are the promotion of a call centre industry and business process outsourcing, and the work done by the Gauteng Economic Development Agency and the Gauteng Enterprise Propeller, which is our SMME agency, in supporting municipalities in the promotion of local economic development and the support for small, medium and micro enterprises and co-operatives. These efforts will be further strengthened and expanded.

In line with the Gauteng City-Region perspective we will, during this financial year, finalise the process of consolidating the provincial GDS and the growth and development strategies of the metropolitan and district municipalities. This will form the basis for a more coherent development plan for the Gauteng city-region.

We’ll also pay attention to strengthening our efforts aimed at improving strategic economic infrastructure. In this regard, plans for the expansion of the innovation hub and the automotive supplier park in Tshwane are at an advanced stage.

Further strategic infrastructure investments will be made at the O R Tambo International Airport. The industrial development zone and plans for the regeneration of Ekandustria, which was brought into Gauteng from Mpumalanga, will be finalised.

The Cradle of Humankind will see the establishment of new visitor- orientation centres to enhance this World Heritage Site’s appeal to tourists. Strategic infrastructure is also being built in and around Dinokeng Game Reserve. Collectively, these interventions are aimed at further accelerating the growth of the provincial economy, creating jobs and fighting poverty.

We are also acutely aware of the reality that, central to our effort to overcome poverty, create jobs and grow the economy is the need to enhance the human potential of our people through education and skills development. The development of skills is also critical, to ensure that the Gauteng city- region becomes globally competitive.

To respond to this challenge, we’ll vigorously implement the provincial human resource development strategy, which we have now formally launched. This strategy will also assist us to identify, develop, recruit and retain skills that meet the requirements of the provincial economy. The strategy will also strengthen our efforts to enhance the capacity of the state to deliver quality services to our people.

In line with our HRD strategy, we’ll form partnerships with institutions of higher learning, further education and training colleges and industry players to develop skills that meet the requirements of the provincial economy.

In conclusion, in pursuit of this objective, we’ve launched a skills development project with Ifihlile Aircon Corporation to train 600 young people a year in refrigeration, airconditioning and ventilation systems. Our support for this initiative is based on the fact that there is an acute shortage of skills in this sector and this sector will likely benefit from the current boom in the construction industry in Gauteng.

Processes are also under way to establish a Gauteng City-Region Academy, which will strengthen efforts to identify and develop skills needed to manage a successful city-region. This forms part of efforts to strengthen the capacity and organisation of the state.

We approach the future with confidence that a better Gauteng is in the making. We are cognisant of the reality that in about two years from now we’ll have to return to our people and report back to them on the progress we have made in delivering on the mandate they gave us back in 2004. It is for this reason that we’ll endeavour to sustain the momentum we’ve built and ensure that our achievements are elevated to an even higher level.

Generally, for more information on work in the economy in all our agencies, we urge members of this Council to, from time to time, click on Gauteng Online to check on the progress our province is making in growing the economy and developing the human resource capacity of our province, creating jobs and fighting poverty. I thank you. [Applause.]

Mr N D HENDRICKSE: Hon Chair, hon Ministers and hon members, with the Minister now being mid-term with his tenure, many positive changes have occurred in the Department of Trade and Industry and the family of institutions. One big success has been the nationwide roll-out of the Small Enterprise Development Agency offices in most provinces. Many small entrepreneurs have high regard for the quality of business advice given.

The much-vaunted and talked-about industry strategy must be brought to fruition, given that substantial funds are being poured into infrastructure development in the lead-up to 2010.

The China trade deal to halt cheap imports for a certain period has assisted in the textile sector in the Western Cape, and we are very grateful for that, but we still need larger retailers to procure from the South African sector. Local procurement has improved and, according to unions, things are looking up in the clothing sector.

The attempt to improve the Companies and Intellectual Property Registration Office, Cipro, with a better information technology system is working, but it still takes far too long to register a company in South Africa. We need to look at simplification of forms to achieve a quicker turnaround time in issuing registration numbers.

Trade and Investment South Africa must improve inward investment ratios. We would also like to see South Africa’s advocacy role increased at the World Trade Organisation by assisting countries like Vietnam, which has recently joined.

This is important: We are very happy about the advent of the National Credit Regulator, in which we will see the maverick credit market cool down after 1 June 2007 when the National Credit Act becomes operational, but we need to see enforcement. Bad lending practices have extended across the mainstream banking sector, concerning micro lenders etc. We would like to see blacklistings cleared completely, so that people can start with a clean slate right across the board.

Bilateral trade relations with African countries have improved, which augurs well for intra-African trade. But, we need to see African airlines open the skies and that will make business travel easier.

Interest rates on loans from the various agencies like Khula, the Industrial Development Corporation and the Land Bank are far too high. Farmers especially battle to make their margins work for them. When we consider that farmers during the apartheid era were heavily subsidised, one wonders why our government cannot help our farmers in the same way. Why must they battle like this?

Co-operatives could be a valuable tool in the establishment of rural development nodes. We see this as an extension of the “gooi-gooi” - other people call them stokvels - which is commonly known. This should be aggressively pursued.

We are very happy to see that the BEE Codes of Good Practice will be phased in, as we have seen many people fronting and getting away with it.

In conclusion, we laud your department. We think they have done a good job and they are continuing to do a good job. The UIF supports the Budget Vote. Thank you. [Applause.]

Ms A N T MCHUNU: Hon Chairperson, hon Minister and our hon Deputy Ministers, the aim of the Department of Trade and Industry is to lead and facilitate access to sustainable economic activity and employment for all South Africans through its understanding of the economy, its knowledge of economic opportunities and potential and its anticipation of the future.

The department also aims to catalyse economic transformation and development and to provide a predictable, competitive, equitable and socially responsible environment for investment, enterprise and trade for economic citizens. In this way, the department will contribute to achieving government’s vision of an adaptive and restructured economy, characterised by accelerated economic growth, employment creation and greater equity by

1. I have taken this information from the Estimates of National Expenditure of 2007, page 681.

In the Budget Speech of 2007, the hon Minister of Finance, Mr T A Manuel, Member of Parliament, had this to say in his speech:

The economy continued to expand at a robust pace of 4,9% in 2006, generating new jobs, broadening the consumer base and providing impetus for a rapid growth in investment.

He went on to say:

Conversely, poor performances by agriculture and mining weighed on growth in 2006.

The DTI’s vision and mission are aligned with government’s economic policy goals, as stated by our select committee. The Department of Trade and Industry has committed itself to a number of flagship programmes and it has contributed to bridging the divide between the first and the second economies. Jipsa and Asgisa fully support this bridging as well.

I am pleading for attention to be given to the third economy that is mainly formed by the rural communities and the people who are on the outskirts of urban areas, who come to towns in order to get employment; and I am also pleading for Project Consolidate municipalities. These sectors need development that is based on agriculture. The gold of the 21st century will then have to be supported by assisting agricultural co-operatives in getting soya seed, planting and processing. [Interjections.]

The VitaGoat and SoyCow processors are manufactured in India. An attempt has to be made to get this firm that manufactures these processors to be located in South Africa so that the rest of Africa is able to access these processors, perhaps in a cheaper way. Out of soya one gets milk, maas, tofu, cheese, meat and lip-licking yoghurt. From soya one gets chicken feed, cattle feed, pig feed, etc. Nothing gets thrown away.

Everybody gains with soya, especially those in agriculture who plant it. The soil where soya is grown is fertilised with nitrogen from soya beans. Jobs are created because of the labour used for planting, cultivating, reaping, winnowing and processing it. The retailers sell the products like milk, maas, soya mince, and beautiful ladies and gentlemen use the oils and soaps made from soya oil. For biofuels, soya is also included.

Ripple training may be done by co-operatives, thus lessening the financial burden of training participants. Soya is for health and wealth and the vision of the DTI is thus supported regarding economic growth by healthy communities, and soya provides many products for export. As South Africans, we can walk tall in the corridors of the World Trade Organisation when we also have soya exports to speak about, bearing in mind that inter-Africa export is included.

DTI programmes are good for all sectors and communities, including women, youth and people with disabilities. The DTI has to ensure that all communities know about these good programmes and has to ensure implementation. Working collaboratively will better assist poor people to benefit from these programmes. The IFP supports the budget. [Applause.]

I thank the hon Minister, the hon Deputy Ministers and the hon members who are going to do oversight over soya planting and processing. [Laughter.]

The HOUSE CHAIRPERSON (Mr T S Setona): Order, hon members! Hon Minister, I am afraid that every time during the Budget debate, soya gets mentioned as part of the core business of your department. Maybe we’ll hear your response to that, because the hon member feels strongly about it.

Mr J M SIBIYA: Chairperson, perhaps it is high time that Limpopo gets expertise from KwaZulu-Natal colleagues to also grow soya beans and export them. [Laughter.]

Comrade Chairperson, hon Minister, hon Deputy Ministers, officials from the department, colleagues, comrades, ladies and gentlemen, a department of trade and industry is one of the most strategic and firm foundation of industry in the economy of any country. This is so because it plays a vital role in injecting cash and technology into the economy.

Our Department of Trade and Industry, whose Budget Vote we are debating now, is not about to become an exception. Through this department, our government is able to jack up all other departments, thereby ensuring the all-round development of our economy. It is through this department, in part, that today we have Mr Radzilani, in Venda …

… Va-Tsatsawani, eGiyani na Va-Khombomuni, le bo-Kgabo, gaMashashane … [… the likes of Tsatsawani and Khombomuni in Giyani as well as Kgabo of Mashashane …]

… who are farming not only for survival and subsistence purposes, but also for export and local supply.

In this instance, I have a very interesting example. In my constituency at Ha-Lambani, towards the border with Zimbabwe, in Venda, there is a gentleman whose name, I think, is Israel. I am not sure, but I know his surname is Nemaorani. This gentleman farms with oranges. He has approximately 20 employees. These are not just any orange you can think of. These are oranges called Valencia and Navel, but I don’t know which kind he farms with.

He farms with a specific type of oranges which are meant solely for export to one country in this world. You will be surprised, because that country is Russia. [Laughter.] It became very interesting for me when I had a discussion with that gentleman. He said that the oranges were prescribed to him by those who needed them in that country. Perhaps I need to go back to him and find out how best we can link those oranges with the soya beans and have the two linked. [Laughter.]

There are also other success stories that we have in our constituency. For instance, at Mubvumoni, a village surrounded by mountains, there is only one entrance towards the west. If you come from any other direction, you can’t access it. There is a poultry farming project which is run by disabled people. They are able to produce 30 trays of eggs per day and it is in that area where, for the first time, I saw different sizes of cycad trees. Some were tall and others were short. I had never seen them before, but I saw them there.

The people there had only one problem: The local market was no longer able to absorb all the eggs they produced. They appealed to our constituency office to secure them at least an old or second-hand tractor with a trailer, in order to enable them to transport those eggs to a bigger market in Thohoyandou, which is approximately 45 km away. In this instance, we would request the DTI to help to get assistance for some of these projects so that they become a full and complete success story for us to talk about.

Perhaps, it will be a good thing now to begin to refer to a lady who once won an award. I have forgotten her name, but our provincial Whip remembers it. She stays at Phiphidi. We once went there. When we spoke to her, she indicated that she had acquired some of the skills she had, which enabled her to produce the way she did, from the farm known as ZZ2. The farmer there assisted her to get her product to the big market in this country – Johannesburg. Her tomatoes reached that market because she acquired skills that enabled her to do so. Therefore, we also appeal to the DTI to help those emerging farmers in some of these areas, including my own, so that they can also become as prosperous as the ones we have referred to.

It is true that there are some projects that start and continue for two to five months and then collapse. They don’t collapse because there are no support materials in terms of finances and so on, but because there are specific reasons for them not to continue. Some of those reasons are as follows, and I am going to speak my language now.

Ku kala vutivi xavumbirhi ku kala ntokoto xamunharhu ku kala vutivi bya matirhisele ya mali na xa vumune ku hatlisela ku tirhisetela mali ya ntswalo wa mabindzu ya vona ya nga si kota ku yima hi woxe ya gwirima. (Translation of Xitsonga paragraph follows.)

[Firstly, lack of knowledge; secondly, lack of experience; thirdly, lack of financial management skills; and fourthly, spending their profit even before their businesses are well-established and sustainable.]

Our “Shangaan Economics 101” tells us: Homu ku pfuxiwa leyi yi tipfuxaka. [Va hleka.] [God only helps those who help themselves. [Laughter.]]

If we were to speak in English, we would translate this as meaning that a struggling cow that is trying to get to its feet can be assisted onto its feet. Hon Minister, we have a lot of cows that are struggling to stand up. Let us rally around them and help them to get on their feet.

This morning I was very impressed. I happened to get a chance to attend a briefing session by the officials from the Department of Foreign Affairs. In that briefing, in part, they said to us that South Africa contributes 23% of the GDP of the whole continent of Africa, followed by Egypt with 18%; Algeria with 17% and the fourth country being Nigeria, with 9%. That 23% tells a story and I have a very serious belief and conviction that the DTI’s hand is there, and that it contributed greatly in getting that rating for us. We are saying to the DTI: Thank you very much for a job well done. [Applause.]

We were also informed that in the recent Maseru extraordinary summit of SADC countries there was a review of the programmes which have been put in place for regional economic integration. They said that it was emphasised that the realisation of the creation of the free trade area by next year has to be attained at all costs. I know that the DTI is also there. It is getting things going.

They also indicated to us, as the Deputy Minister indicated, that the preparation for a customs union by 2010 has to be started, so that by that target date we would have it in place. Even regarding that, we know, especially in our committee, that the DTI is involved. It has been taken to the people and now it is being taken to the subcontinent, to the continent and now to the whole world. That is why we are there at the WTO.

Because of that presence, in a mostly shark-infested area inhabited by experts, the voice of Africa, Asia, the Pacific and Latin America is being heard, even if faintly, something which we could not talk about 10 to 20 years ago, I know that the DTI is there. [Interjections.]

Kahle, kahle. [Wait a moment.]

It will be morally wrong and historically unjustifiable not to indicate that this department, together with other politicians of our country, in particular, are doing a very, very big job. There are a lot of subtleties and corridor consultations in that WTO platform and for the bit that they are able to get hold of, and open a bit of space, we need to say a very big thank you to them.

We believe, in no uncertain terms, that one day, through the DTI and all departments in our country, through our people and our leaders and the continent as a whole, the sun will rise; to rise and never to set. We are confident about that. That is why the ANC fully and unreservedly supports the Vote, and urges this House to do the same, for the sake of the coming generation. I thank you. [Applause.]

The MINISTER OF TRADE AND INDUSTRY: Chairperson, I would like to thank all the hon members for their participation in the debate and for their good stories that they have shared with us. I think Gauteng shared with us a very good story about what they are planning to do with their province. I think that’s a very good example for all of us to follow, because that is the challenge that faces all provinces, namely to look at what it is that can be done, with what each province has.

Part of the challenge that faces all of us requires that we co-operate and co-ordinate a lot more. We need to look at how we optimise every potential that is there, so that even in those areas the people who produce eggs and others that you referred to are taken care of. How do we ensure that during the times when those people require assistance of whatever kind we are there to provide that assistance so that we can actually maximise the potential?

In every part of the country where you have people and where you have land

• those are resources. What are the things that we can do in order to maximise those resources? Therefore, it is important for us to deepen the co-ordination and co-operation between national, provincial and local government as well as between us as departments and the different agencies. We have a lot of agencies to respond to any need in any part of the country, and some of our agencies are able to respond to these issues.

As a department, we have really been looking at these issues. We have been looking at the issue of our own capacity as a department. One of the things we have been working on has been to ensure that we deal with the issue of vacancies so that we have the necessary people to do the work that needs to be undertaken. We have been looking at the issue of improving integration within the department, and also between the department and all its agencies.

We have also been grappling with this question: With the DTI being such a big department and with so many things, what is it that brings everything together? What is it that gives direction to all of these agencies that we have within the DTI?

We think that the work that we have been doing on the industrial policy framework will actually be able to tie in very well with all of the different divisions that we have in the Department of Trade and Industry and all of the different agencies that we have. So, we have been working to improve integration and co-ordination across the entirety of the DTI family as well as improving our own interactions and co-ordination with provincial and local government. We have tried to have a work programme for our Minmec so that we know that over the next three years these are the things that we are going to do together.

We have also been raising our profile in the growth and development process that was undertaken by the various districts across the country. So, these are all of the things that we have been doing, because we believe that we have to interact with all of these stakeholders, if we are to effectively play our role. Of course, we are working in the area of ensuring that, as and when necessary, we can realise more resources to support our work as the department and do a lot of work to overcome the divide between the first and second economies.

Many of the things that need to be done are things that the DTI has to have a hand in, because it’s about supporting entrepreneurship; it’s about supporting micro enterprises and small and medium enterprises generally; it’s about access to markets, finance and other kinds of support for these enterprises. We have been doing work also to clarify for ourselves what the best approach is to respond to the second economy challenges.

We think that we have utilised the last 18 months or so to put in place the sort of institutional mechanisms that will enable us to respond to the challenges that are out there. Seda branches are really interesting things that are happening in the utilisation of this infrastructure; they are the things that are starting to happen; and they are the kind of assistance that is being rendered to entrepreneurs. I think one gentleman did say here that small entrepreneurs who make use of these services regard the advice they get very highly. So, we have to strengthen those organisations and improve the service delivery.

Of course, I think that hon Sibiya is really quite correct that the DTI has a very strong role, in relation to all of the things that are happening in the region, within the continent and, of course, broadly across the world. Within our own region we are very much involved within the Southern African Customs Union and the regional integration processes of SADC. For instance, we are going to host a AU conference that is going to look at issues of industrialisation throughout the whole continent.

We do a lot of work in developing bilateral trade relations and economic co- operation relations with all of our agencies. Some of our agencies – the IDC, the SA Bureau of Standards, the SA Accreditation System, competition authorities - are involved in co-operation and capacity-building exercises with many African countries, because a lot of countries don’t necessarily have the sort of capacities that we have.

So, in certain instances, our own institutions have to go in there and provide the necessary assistance. Therefore, there is really quite a lot that is happening in that area. There are agreements that we have entered into with various countries to promote trade and so on. So, we intend to ensure that the DTI occupies its rightful place at the centre of economic development. That is something, going forward, that we are going to be looking at and strengthening as much as possible.

Hon Mchunu has said that we need to optimise all economic potential. I have included soya in there. [Laughter.] There is a big role that will be played by co-operatives. It’s a different form of enterprise that has the potential to absorb a lot of people. I think we heard the Deputy Minister talking about how we are actually active in all of the provinces in this area. She even referred to “16 provinces” when she was actually talking about 16 projects across all nine provinces. But that serves to show that we are trying to promote co-operatives across the country.

I think that the issue raised by one hon member on the interest rates of our development finance institutions is an important point. The DFIs get signals from government as to what is expected of them. It is a good thing that a lot of our DFIs are able to be self-sustainable. But I think there are instances where we really have a developmental approach and where we recognise that there is a particular challenge that we have to respond to. You may have to accept that.

If we were to look at what the SA Micro-finance Apex Fund has been doing, a lot of the money that they’ve spent, for instance over the past year, is capacity-building money. It’s money that you are paying out but it’s not money that you expect to get back. You have to accept that, in order to ensure that the capacity to manage the work that needs to be managed is there and that the systems are there. So, in certain instances you have to accept that certain monies have to be invested, with no expectation that they will be paid back, but the point is well taken.

Hon member, you raised the issue of our advocacy role in the WTO. You even cited the issue of countries acceding to the WTO. We’ve generally supported developing countries that have sought to accede to the WTO. For instance, we supported China. Deputy Minister Davies was telling me just now when you were raising this point that we have granted market economy status to Vietnam and generally support their accession processes. There are various other African countries that we also provided support to in their efforts to accede to the WTO.

The issue around African skies continues to be a challenging one. I don’t really have answers for that, but there is an attempt by ministers of transport on the African continent to have some processes. However, this issue continues to be a challenging one. I think that until we have resolved the issue of travel around the African continent, it’s going to be very difficult to improve the efficiencies of moving goods and people across the continent. So, it is something that is challenging us and requires a lot more urgent attention than it may have received thus far.

On the issue of the registration of companies, I think Cipro continues to improve and all we can do is to continue to strengthen that trend. We will continue to do so and ensure that we take note of the fact that part of what the Companies Bill that is currently being discussed in the public domain aims to achieve is to really simplify the registration of companies and keep what companies have to do in order to be registered as companies, to the absolute minimum. So, we will continue to work on improving the speed of registration of companies. Regarding the issue of the industrial policy framework, we are indeed hard at work. As you know, Cabinet did adopt the industrial policy framework. But, before it could be published, we should do some more work to come up with an industrial policy programme that would go with that.

Since that hon member mentioned the issue of infrastructure spending, in this regard, I should point out that one of the areas that we are particularly working on is that of capital goods. Traditionally, South Africa has had the capacity to produce capital goods. It’s an industry that has, over time, declined because the country has not been investing. Now, with investment picking up, part of our challenge is: How can we respond to the rising investment spending in order to ensure that we can support it and minimise the import content of all of this infrastructure investment that is taking place in the economy? So, we are working in that area but we are also working in other areas and we hope that soon we will be able to bring something into the public domain.

We are working comprehensively around the clothing and textile sector. Quotas are not the only response that we’ve had. Quotas were really a very specific response to a specific approach that was made to us as a department. We didn’t think that that was the best course of action to follow - which was to take China to the WTO – because it’s a very, very difficult route to follow.

We adopted this particular response because we thought it would give us relief at one level but open up possibilities for us to co-operate much more broadly with China in a way that can actually open up opportunities for various South African companies, not just in the clothing and textile sector, but right across the spectrum. So, we have taken a more strategic approach to the issue of China, but we are really working across the board to implement a strategy for this sector that will see us turn it around and make it a lot more competitive than it has been thus far.

Regarding the particular firm that you were talking about, I would say we have been able to respond in particular ways when South African companies faced difficulties because of the quotas. We have had all of the major retailing companies – Pep Stores and Woolworths - who sell a specific product requesting us to relax the requirements, and we have done that. They have done this in a collaborative way.

You have the stakeholders interacting - the manufacturers, the retailers and labour. They approached the Department of Trade and Industry. I think we had the necessary flexibility even as we implemented the quota system. [Interjections.] I think my time has expired, Chair. Thank you very much, hon members. [Applause.]

Debate concluded. The HOUSE CHAIRPERSON (Mr T S Setona): Order! Thank you very much, hon Minister and hon Deputy Ministers of Trade and Industry for your efforts to lead this Budget Vote debate this afternoon in this august House. I think I am saying thank you on behalf of this House at large.

The Council adjourned at 16:10. ____

            ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS

ANNOUNCEMENTS

National Assembly and National Council of Provinces

The Speaker and the Chairperson

1. Introduction of Bills

 (1)    The Minister for Public Enterprises


     (a)           South African Express Bill [B 14 - 2007] (National
          Assembly – proposed sec 75) [Explanatory summary of Bill and
          prior notice of its introduction published in Government
          Gazette No 29879 of 11 May 2007.]


        Introduction and referral to the Portfolio Committee on Public
          Enterprises of the National Assembly, as well as referral to
          the Joint Tagging Mechanism (JTM) for classification in terms
          of Joint Rule 160.


        In terms of Joint Rule 154 written views on the classification
          of the Bill may be submitted to the JTM within three
          parliamentary working days.

 (2)    The Minister for Justice and Constitutional Development


     (a)     Criminal Law (Sentencing) Amendment Bill [B 15 - 2007]
          (National Assembly – proposed sec 75) [Explanatory summary of
          Bill and prior notice of its introduction published in
          Government Gazette No 29908 of 22 May 2007.]


        Introduction and referral to the Portfolio Committee on Justice
          and Constitutional Development of the National Assembly, as
          well as referral to the Joint Tagging Mechanism (JTM) for
          classification in terms of Joint Rule 160.


        In terms of Joint Rule 154 written views on the classification
          of the Bill may be submitted to the JTM within three
          parliamentary working days.

 (3)    The Minister of Science and Technology


     (a)     Human Sciences Research Council Bill [B 16 - 2007]
          (National Assembly – proposed sec 75) [Explanatory summary of
          Bill and prior notice of its introduction published in
          Government Gazette No 29897 of 25 May 2007.]
     (b)     Astronomy Geographic Advantage  Bill [B 17 - 2007]
          (National Assembly proposed sec 75) [Explanatory summary of
          Bill and prior notice of its introduction published in
          Government Gazette No 29897 of 25 May 2007.]


         Introduction and referral to the Portfolio Committee on
         Science and Technology of the National Assembly, as well as
         referral to the Joint Tagging Mechanism (JTM) for
         classification in terms of Joint Rule 160.


         In terms of Joint Rule 154 written views on the classification
         of the Bills may be submitted to the JTM within three
         parliamentary working days

National Council of Provinces

Referral to Committees of papers tabled

Please note: The referrals below replaces the “Referrals to Committees of papers tabled” on page 781 of the Announcements, Tablings and Committee Reports of 17 May 2007:

1. The following papers are referred to the Select Committee on Finance:

   (a) Strategic Objective Grant Agreement No 674-0329 between the United States of America and the Republic of South Africa for Increased use of HIV/AIDS and Other Primary Health Care Services, tabled in terms of section 231(3) of the Constitution, 1996 (Act No 108 of 1996).

   (b) Explanatory Memorandum to the Strategic Objective Grant Agreement No 674-0329 between the United States of America and the Republic of South Africa for Increased use of HIV/AIDS and Other Primary Health Care Services.

   (c) Addendum to the South Africa-European Community Country Strategy Paper and Multi-Annual Indicative Programme for the Period 2003- 2005, tabled in terms of section 231(3) of the Constitution, 1996 (Act No 108 of 1996).

   (d) Explanatory Memorandum to the Addendum to the South Africa- European Community Country Strategy Paper and Multi-Annual Indicative Programme for the Period 2003-2005.

   (e) Government Notice No 305 published in Government Gazette No 29781 dated 5 April 2007: Exemption from certain Specific Provisions of the Act to facilitate electricity industry restructuring, in terms of the Local Government: Municipal Finance Management Act, 2003 (Act No 56 of 2003).

   (f) Government Notice No 210 published in Government Gazette No 29698 dated 12 March 2007: The dimension of, design for, and compilation of, the year 2007 Natura pure gold coin series, in terms of the South African Reserve Bank Act, 1989 (Act No 90 of 1989).

   (g) Government Notice No 211 published in Government Gazette No 29698 dated 12 March 2007: The dimension of, design for, and compilation of the year 2007 Protea coin series, in terms of the South African Reserve Bank Act, 1989 (Act No 90 of 1989).

   (h) Government Notice No 212 published in Government Gazette No 29698 dated 12 March 2007: The dimension of, design for and compilation of the year 2007 R1 and R2 pure gold coin series, in terms of the South African Reserve Bank Act, 1989 (Act No 90 of 1989).

   (i) Government Notice No 213 published in Government Gazette No 29698 dated 12 March 2007: The dimension of, design for, and compilation of the year 2007 Crown size and 2½c Sterling silver coin series, in terms of the South African Reserve Bank Act, 1989 (Act No 90 of 1989).

   (j) Government Notice No 214 published in Government Gazette No 29698 dated 12 March 2007: The dimension of, design for, and compilation of the year 2007 Sterling silver coin series, in terms of the South African Reserve Bank Act, 1989 (Act No 90 of 1989).

   (k) Government Notice No 215 published in Government Gazette No 29698 dated 12 March 2007: The dimension of, design for, and compilation of, the year 2007 “FIFA 2010 Coin Series”, in terms of the South African Reserve Bank Act, 1989 (Act No 90 of 1989).

   (l) Government Notice No R.251 published in Government Gazette No 29707 dated 23 March 2007: Amendment of Schedule No. 2 (No. 2/284), in terms of the Customs and Excise Act, 1964 (Act No 91 of 1964).

   (m) Government Notice No 271 published in Government Gazette No 29742 dated 28 March 2007: Fixing Amount of Tax in Dispute for purposes of Appeal to Tax Board, in terms of the Income Tax Act, 1962 (Act No 58 of 1962) and Value-Added Tax Act, 1991 (Act No 89 of 1991).

   (n) Government Notice No R.270 published in Government Gazette No 29741 dated 28 March 2007: Transitional arrangements for municipalities following the deletion of paragraph (c) of the definition of “enterprise” in section 1 of the Act, the zero rating of municipal rates and other consequential amendments, in terms of the Value-Added Tax Act, 1991 (Act No 89 of 1991).

   (o) Government Notice No 317 published in Government Gazette No 29797 dated 14 April 2007: Allocations per municipality for each Schedule 3, 4, 6 and 7 allocation to local government and the framework for each Schedule 4, 5, and 7 allocation, made under the Division of Revenue Act, 2007 (Act No 1 of 2007).

   (p) Government Notice No 316 published in Government Gazette No 29788 dated 13 April 2007: Regulations issued under section 91A prescribing the circumstances under which the Commissioner may write-off or compromise any amount of tax, duty, levy, charge, interest, penalty or other amount, in terms of the Income Tax Act, 1962 (Act No 58 of 1962). 2 The following paper is referred to the Select Committee on Public Services for consideration and report:

   (a) Reports and Financial Statements of the Road Traffic Management Corporation for 2003-2004, 2004-2005 and 2005-2006, including the Reports of the Auditor-General on the Financial Statements for 2003-2004, 2004-2005 and 2005-2006.

2. The following papers are referred to the Select Committee on Land and Environmental Affairs for consideration:

   (a) General Notice No 224 published in Government Gazette No 29674 dated 2 March 2007: Invitation to members of the public to submit written comments on the national norms and standards for the management of elephants in South Africa, tabled in terms of section 100 of the National Environmental Management: Biodiversity Act, 2004 (Act No 10 of 2004).

   (b) General Notice No 329 published in Government Gazette No 29711 dated 16 March 2007: Draft regulations on Bio-prospecting, access and benefit-sharing: published for public comment, tabled in terms of the National Environmental Management Act: Biodiversity Act, 2004 (Act No 10 of 2004).

   (c) Strategic Plan for the Department of Water Affairs and Forestry for 2007/08 to 2009/10.

3. The following papers are referred to the Select Committee on Security and Constitutional Affairs and the Joint Standing Committee on Defence: (a) The President of the Republic submitted a letter dated 23 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 Nepal.

   (b) The Acting President of the Republic submitted a letter dated 28 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 West Indies.

   (c) The Acting President of the Republic submitted the following letter dated 28 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.

4. The following paper is referred to the Select Committee on Local Government and Administration for consideration:

   (a) Quarterly report of the Auditor-General on the submission of financial statements by municipalities and the status of audit reports as at 31 December 2006 for the financial year ended 30 June 2006 [RP 30-2007].

5. The following paper is referred to the Select Committee on Security and Constitutional Affairs for consideration and report:

   (a) Report and Financial Statements of the Judicial Service Commission for the year ended 30 June 2006.

6. The following papers are referred to the Select Committee on Labour and Public Enterprises for consideration:

   (a) Preliminary Annual Report of the Department of Labour for 2006- 2007 [RP 44-2007].

   (b) Strategic Plan of the Department of Labour for 2007 to 2010 [RP 43-2007].

   (c) Strategic Plan of the Umsobomvu Youth Fund for 2007 to 2008.

7. The following papers are referred to the Select Committee on Security and Constitutional Affairs for consideration:

   (a) Strategic Plan for the South African Police Service for 2007 to 2008 [RP 34-2007].

   (b) Report on the withholding of remuneration of Mr I X Masimini, an additional magistrate at Queenstown, in terms of section 13(4A)(b) of the Magistrates’ Act, 1993 (Act No 90 of 1993).

   c) Proclamation No R.5 published in Government Gazette No 29756 dated 30 March 2007: Amendment of Proclamation in terms of the Special Investigating Units and Special Tribunals Act, 1996 (Act No 74 of 1996).

TABLINGS

National Assembly and National Council of Provinces

1. The Speaker and the Chairperson

   (a) Strategic Plan for the Office of the Public Protector (OPP) for April 2007 to March 2010.

2. The Minister of Finance

   (a) Government Notice No R.435 published in Government Gazette No 29881 dated 18 May 2007: Determination of amounts for purposes of the Military Pension Act, 1976 (Act No 84 of 1976).

3. The Minister of Environmental Affairs and Tourism

   (a) Annual Review of the Department of Environmental Affairs and Tourism for 2006/07.

COMMITTEE REPORTS

National Council of Provinces

1. Report of the Select Committee on Social Services on the Health Professions Amendment Bill [B10B – 2006] (National Assembly – sec 76), dated 29 May 2007:

   The Select Committee on Social Services, having considered the subject of the Health Professions Amendment Bill [B10B – 2006] (National Assembly – sec 76), referred to it and classified by the Joint Tagging Mechanism as a section 76 Bill, reports the Bill with amendments [B 10C - 2006].