Reply to questions in National Council of Provinces,

6 SEPTEMBER 2018

Deputy President

Plight of marginalised townships

13. Mr S J Mohai (Free State: ANC) to ask the Deputy President:
Whether the (a) National Industrial Policy Framework and (b) Human Resource Development Strategy for South Africa are yielding any benefits in assisting the Government to address the plight of previously marginalised communities in (i) townships such as Botshabelo, Mdantsane and Khayelitsha and (ii) former homelands such as Kanyamazane and Siyabuswa in order to foster a favourable trajectory of (aa) economic growth and (bb) opportunities for (aaa) employment, (bbb) economic activities and (ccc) skills development; if not, why not; if so, what are the relevant details? CO473E

REPLY
Without doubt, current efforts are beginning to yield positive results in terms of skills development, job creation and economic growth. However, a lot more still needs to be done.

The intention of the National Industrial Policy Framework is to effect structural change in our growth path towards a more labour absorbing and value adding economy. In this process, it was important to prioritise areas of economy and diversify the geographic spread of industrial development. This also includes a focus on skills development through integration of SMMEs into value chains and incubation programmes.

To expand the skills base that supports industrial development, government is implementing programmes aimed at addressing the shortage of scarce and critical skills across the key sectors of our economy. This includes government’s renewed focus on apprenticeships, and development of artisans, particularly focussing on promoting youth employment.

Through targeted bursaries, opportunities are provided to enhance the development of scarce and critical skills, including international study programmes in partnership countries abroad.

More importantly, partnerships between industry and higher education institutions are clearly geared towards aligning industry skills demand with the supply of critical skills by our higher education system.

For example, the launch of the 64-dish Meerkat phase of the Square Kilometre Array, the world’s largest telescope of its kind, provides an important platform for fostering innovation and skills development partnerships.

Honourable Members,
One of the core objectives of the National Industrial Policy Framework is the promotion of a broader-based industrialisation path characterised by greater levels of participation by historically disadvantaged economic citizens and marginalised regions in the mainstream of the industrial economy.

It focuses on identifying and addressing the cross-cutting and sector-specific constraints and opportunities prevailing in the industrial economy through thirteen (13) strategic programmes. One of the strategic programmes is Spatial and Industrial Infrastructure, which is important in fostering industrial clustering.

Support has been expanded from the Industrial Development Zones to include the creation of Special Economic Zones. These Economic Zones are central to government’s strategic objectives of industrialisation, regional development and employment creation. The Special Economic Zone Programme was specifically developed to promote the creation of a regionally diversified industrial economy by establishing new industrial hubs in underdeveloped regions of the country.

The total number of designated Special Economic Zones has to date increased to nine (9). The majority of these were designated as IDZs and are presently in the process of transitioning their institutional, governance and ownership structures in compliance with the requirements of the SEZ Act. The designated SEZs continue to show a positive progress in terms of the number of investors operating in the zones. More importantly, there has also been a significant increase in the number and value of secured investment.

The number of operational investors in designated SEZs has increased from 72 to 80, with an investment value of over R10 billion. The number of direct jobs created to date is 13 722.

The number of secured or signed investors is 86, with a total investment value of R52.2 billion. These SEZs include Richards Bay IDZ (KZN), Saldanha Bay IDZ (Western Cape), Dube Trade Port SEZ (KZN), COEGA IDZ (Eastern Cape), East London IDZ (Eastern Cape), Gauteng IDZ (Gauteng), Maluti-A-Phofung SEZ (Free – State), Atlantis SEZ (Western Cape), Musina-Makhado SEZ (Limpopo).

Some of these IDZs/SEZs such as Musina-Makhado SEZ, Saldanha Bay IDZ, Maluti-A-Phofung SEZ and the Atlantis SEZ are in the previously marginalised areas.

Work is underway between the Department of Trade and Industry and the Provinces on the planning and implementation of SEZs in the following previously marginalised communities; Nkomazi (Mpumalanga), Bojanala (North West), Upington (Northern Cape) and Tubatse (Limpopo).

Additionally, in order to bring about full scale industrialisation and inclusive growth, government initiated a structured programme for the revitalisation of industrial parks located in old industrial areas across the country. The programme has identified 11 state-owned industrial parks to be revitalised and this is implemented through national government partnerships with the provinces, their agencies and municipalities.

I am advised by the Department of Trade and Industry that, to date, a total of 65 854 jobs have been created within these State Owned Industrial Parks across the country. These cover townships and underdeveloped areas such Botshabelo, Seshego, Garankuwa, Nkowankowa, Isithebe, to name but a few.

In the last two years alone, government has invested approximately R511m in revitalizing the basic infrastructure of 10 Industrial Parks across South Africa to address challenges of key industrial development infrastructure such as electricity, bulk water supply and sewage system. This has assisted in arresting the decline in the Industrial Park’s infrastructure so as to encourage further investment.

Thank You!
 
SAFE initiative/Eradication of pit toilets
14. Mr J W W Julius (Gauteng: DA) to ask the Deputy President:
What support he intends to provide as Leader of Government Business to the Minister of Basic Education in her (a) recently launched Sanitation Appropriate for Education initiative and (b) efforts to eradicate pit toilets in schools? CO478E

REPLY
As part of support to the Minister of Basic Education His Excellency the President, accompanied by myself in my capacity as the Deputy President of the Republic of South Africa, held a breakfast on the 14 August 2018 where the Sanitation Appropriate for Education (SAFE) initiative was launched.
The aim of the launch was to invite the private sector and other generous South Africans to pledge financial resources and other technical support in alleviating the problem of inappropriate sanitation in school, in particular pit latrines. The Department of Basic Education was advised to develop a plan informed by the audit of the current state of sanitation in schools across the country. The Presidency will monitor and provide support throughout the implementation of the plan.
In addition to the above support, we will continue to solicit more support from the private sector. To enhance collaboration, I will engage other departments that have a role in the provision of sanitation such as Water and Sanitation, COGTA and Environmental Affairs as well as the local sphere of government to play their part. We will implore communities to support the SAFE initiative and discourage them from disrupting the construction projects once they are on site.

Land expropriation debate
15. Mr M T Mhlanga (Mpumalanga: ANC) to ask the Deputy President:
Whether the Government has considered the manner in which the land question continues to affect social cohesion, especially in light of the subversive attempts of some groups that continue to seek to manipulate the current land expropriation debate by (a) spreading rumours and (b) instilling fear among some citizens; if not, why not; if so, what are the relevant details? CO474E

REPLY
We all agree that we should pursue national unity, peace and reconciliation so as to pave a way for the reconstruction of our society. Our common desire should be to ensure that all us, including corporate citizens participate and cooperate in the self-driven reconstruction and development of South Africa.

There is general acceptance that the goals we defined for ourselves as we adopted the Constitution, have not been fully realised. Currently, the situation demands of us to act together more than before and to resolve our national challenge of inequality and wealth disparities; which in the main are derived from land dispossession and landlessness.

It is this skewed ownership patterns that should mobilise all justice-seeking people and equality activists to continue in the building of a united and prosperous South Africa anchored on the values of our Constitution.

We must confront the historical fault lines and injustices that continue to threaten our peace and stability so that finally we can move forward as one people, one nation and one South Africa founded on shared values.

The reality is that our land reform programme, in its current construct, remains hopelessly inadequate to mitigate the negative impact of the legacy of colonialism and apartheid. This state of affairs continues to be a huge source of frustration and resentment to those who were brutally dispossessed of their land.

It is therefore imperative for us to execute a comprehensive land reform programme which, in its implementation, will enable us to truly transform our country into a non-racial, non-sexist, humane and equal society. Our land reform programme must exhaust all available mechanisms to address the past injustices.

Our land reform programme has been very slow and causing a lot of frustration amongst claimants due to budgetary constraints and a ‘willing buyer-willing seller’ approach. The land reform programme, in its current shape, is clearly unable to meet even the modest and conservative targets that we have set for ourselves.

It is a fact that the bulk of the land in this country is still firmly in the hands of the very few. The question that confronts us is that our political emancipation project remains meaningless for as long as it does not translate into economic emancipation, and land ownership is at the heart of such emancipation.

The market led mechanism of pursuing land reform has proved to be cumbersome, protracted and inappropriate. No political stability, peace and democracy are imaginable as long as the bulk of the land is in the hands of the few. In reality, the positive prospects of our shared destiny are largely dependent on our ability to resolve this land question in a responsible and fair manner.

If we do not make necessary radical decisions that will address the current state of inequality, and concretely deal with past injustices with necessary firmness and determination, we will be postponing the inevitable social friction that would pull us backward instead of launching us as a people – into a prosperous, and shared future.

Honourable Members,

As government, we have engaged in a process that is transparent, responsible and one that provides required leadership on how we finalise land expropriation without compensation.

Comprehensive land reform as means of addressing past injustices that has produced the prevailing triple challenge of poverty, unemployment and inequality, is necessary for our country to move forward as a nation that is united in its diversity. Without this historic redress, we risk having endless social, racial and class frictions.

As the government of the ANC, our preoccupation is fulfilling the vision of building a united, non-racial, non-sexist, democratic and prosperous society. Through each election, we have made a social contract with the people of South Africa, to resolve the National Question in a manner that is inclusive, responsible, and mutually reinforcing in order to attain a better life for all.

It is no coincidence that at government level, we have established an Inter-Ministerial Committee of Land Reform. The task of this Committee, is to provide political oversight on the work being undertaken with regards to implementation of land reform and related anti-poverty interventions on land and agrarian reforms.

In our engagement with the agricultural sector, we have assured farmers (who by the way have come together and agreed to cooperate as different farmer unions), that they will have three representatives in the panel of experts. This panel will assist all of us in providing a unified perspective on expropriation of land without disrupting our productive capacity and economic growth.

We are encouraged by the goodwill of farmers, both black and white, who have expressed their support of this process. They have expressed their unequivocal commitment to working with government and finding practical solutions to the land reform challenges.
As government, we encourage white commercial farmers to partner with government in implementing different models in order to address the land question, including donating land currently in their hands.

The farmers’ unions under AGRI Sector Unity Forum (ASUF) were emphatic that as the agricultural sector, they do not need other organisations outside of this formation to speak on their behalf as they are capable of doing so themselves.

In the final analysis, this country belongs to all of us. We must continue to work together in building a country of Nelson Mandela’s dream. We must ensure that social cohesion is our mantra.

Thank you!

Skilling programmes
16. Mr M Khawula (KwaZulu-Natal: IFP) to ask the Deputy President:
What measures have been initiated by the Human Resources Development Council since its launch in 2010 to ensure the bridging of the gap between the (a) country’s economic needs and (b) programmes for the skilling of (i) relevant and/or (ii) adequate human resources in order to meet the objectives of Vision 2030 regarding skills? CO472E

REPLY
According to the Stats SA Quarterly Labour Force Survey (of the Third Quarter of 2017), more than 18 million people above the age of 20 years have educational levels below the National Senior Certificate. There were more than 3.3 million youth aged between 15 and 24 years, and 4.6 million between 25 to 34 years, who were not in education, employment or training (NEET).

Despite some improvements on the 2008 base figures, it is clear that the challenge of youth ‘not in education, employment, or training’ remains with us. We need to intervene decisively to advance youth development and empowerment.

Noting these developments as identified by Stats SA, the Human Resource Development Council has, through the Human Resource Development Strategy, championed the notion of young unemployed people participating in technical and vocational education and training programmes in order to assist them to enter the labour market.

I am advised by the Department of Higher Education that over the last three years,(2016/17 to 2018/19) more than R2 billion has been allocated to drive occupational trade programmes that are offered by TVET Colleges through the National Skills Fund. To this end, in 2016 for example, the labour market absorbed 62 000 youth who graduated from TVET colleges.

On skills development support for entrepreneurship and cooperatives development, the NYDA, IDC and the Small Enterprise Finance Agency launched a R2.7 billion Youth Fund in 2015 to foster entrepreneurship among the youth in the country.

One of the critical areas of focus by the Human Resource Development Council, is on improving the level of skills in the South African workforce. For example, between the years 2010 to 2014, the share of the employed with matriculation certificates increased by 2.6% (from 49% to 52%), and the share of employed with tertiary education increased from 19.3% to 20.5% over the same period.

In line with the National Development Plan, the Human Resource Development Council is championing Worker Education which is considered critical in building skills for the economy. This is aimed at increasing the number of workers participating in various learning programmes to improve their skills level from 37% in 2016 to a minimum of 80% in 2030.

Over 200 000 individual workers (employed and unemployed), have participated in programmes funded by Sector Education and Training Authorities (SETAs).

In terms of bridging the gap between the country’s economic needs, the Human Resource Development Council was instrumental in driving focused interventions with respect to the production of artisans. As a result, the number of artisans qualifying increased from less than 10 000 in 2010 to more than 22 000 in 2017.

The Department of Higher Education and Training has renewed its focus on apprenticeships, and the implementation of policy on artisan trades, particularly focussing on promoting youth employment. This further compliment other initiatives of skills development and learner exchange programmes that we implement through various partnership with other countries.

There has also been an expansion in the number of young people engaging in programmes that are occupationally directed and funded through the SETAs, National Student Financial Aid Scheme, National Youth Development Agency, National Skills Fund, provincial governments and municipalities.

The partnerships with industry and higher education institutions have contributed a lot to addressing gaps that exist in the job market.

The 2017 report of the Organisation for Economic Co-operation and Development titled: “Getting Skills Right in South Africa”, has called for the provision of tailor-made career advice services to students, based on better skills needs of our economy.

Provincial Human Resource Development Councils continue to do work to ensure that career development is accessible to all. On its part, organised labour has committed to support access to training for the unemployed.

This commitment includes supervising and mentoring unemployed learners into the workplace in accordance with agreed-upon ratios for the sector. Organised Labour is also committed to supporting skills training as part of its commitment to job creation and resource mobilisation. Government, through the Department of Higher Education and Training, will ensure that the necessary financial resources to support this initiative are made available.

Thank you!

Mandate on corruption
17. Ms C Labuschagne (Western Cape: DA) to ask the Deputy President:
What is his mandate, specifically regarding corrupt activities by senior government officials as Patron of the Moral Regeneration Movement? CO479E

REPLY:

President Cyril Ramaphosa has in terms of section 91 (2) and 91 (4) of the Constitution of the Republic of South Africa, delegated to the Deputy President the responsibility to promote Social Cohesion Initiatives. In this regard, the Deputy President is also the patron of the Moral Regeneration Movement.

However, it is important to point out that this delegation of responsibility, does not take away the functions of line Departments which are mandated to deal with various aspects of government’s anti-corruption initiatives.

The mandate delegated to the Deputy President, includes the creation of broad based partnerships between and amongst civil society, private and public sectors to reflect on measures that should be encouraged to reconstruct the social values of democratic South Africa. These values are non-racialism, non-sexism, equality, transparency, honesty, integrity, administrative fairness and professionalism.

In respect of impacting on the work of government, we have adopted Batho Pele principles that are essentially about service to the people. The ANC government has been consistent in the implementation of the resolutions of the governing party in fighting crime and corruption. In this regard, government is doing everything in its power to strengthen existing systems and mechanisms designed to combat this challenge in all its manifestations.

This includes, amongst others, our resolve to strengthen the institutions of criminal justice system by adequately resourcing them and ensuring that they remain independent and impartial.

Similarly, the establishment and resourcing of integrity management units across various government departments and public institutions is intended not only to promote ethical conduct, but to protect the overall integrity of government systems.

Where cases of fraud and corruption are suspected, intergrity management units are tasked to investigate and make specific recommendations to ensure that perpetrators are dealt with in terms of applicable criminal and disciplinary procedures.

The vetting of senior managers in government goes a long towards enabling government to detect integrity challenges which have a potential to compromise the work of government.

On an annual basis, the Department of Public Service and Administration ensures that all senior government officials submit and disclose their financial interests. This allows government to detect the potential for conflicts of interest in instances where government employees do business with government.

Government has resolved that no officials are allowed to do business with government. Where this is detected, disciplinary actions are taken.

The Public Service Commission Anti-Corruption Hotline also continues to be an effective platform to inculcate an ethical and responsive public service. Fraud and corruption complaints reported through this Hotline are investigated for action to be taken where incidents of fraud and corruption are detected.

Among other risk management measures is our focus on strengthening financial management systems to reduce the prevalence of supply chain management irregularities within government. The supply chain management environment is receiving special attention in order curb high levels of irregular expenditure as published by the Auditor-General.

Over and above strengthening government institutions and systems, there is a clear government commitment towards building a cadre of senior public servants whose work is anchored on ethical leadership and sound moral values.

As a Patron of the Moral Regeneration Movement, I fully support the work done by this movement in relation to fighting crime and corruption. The main aim of the Moral Regeneration Movement, which works in close partnership with other organisations and sectors of society, is to galvanise the rest of society into action with the goal of rekindling the moral fibre of South African society.

One of the flagship projects of the Moral Regeneration Movement is the conversation series across the country in promoting the Charter of Positive Values. This Charter is anchored in the universal values of all of humanity, the founding values of the Constitution of the Republic and various aspects of the Bill of Rights. It also finds resonance in the Batho Pele principles to which all public servants must adhere.

In this regard, the fight against social ills, crime and corruption across all sectors is at the centre of the programmes that the Moral Regeneration Movement drives. Among key initiatives, this Movement is seized with a programme focusing on “Ethical and Values-driven Leadership”. This forms part of the induction of government officials as they enter government employment.

Through our partnership with Corruption Watch and Ethics SA, we aim to export the values of this programme beyond government into broader society.

At a local government level, there is a collaboration between the MRM and the South African Local Government Association to promote ethical leadership. Through this initiative, councillors, especially the newly elected cohort, are taken through orientation on the fundamentals of ethical leadership.

This initiative does indeed speak to our commitment to not only fighting crime and corruption, but to also ensuring that we reduce and eliminate fraudulent and corrupt practices within government.

Our stance is that a moral and ethical society must have zero tolerance to corruption, irrespective of who the perpetrator may be, whether a senior government official, a powerful politician or an influential business person. All must face the law as and when they are found to have been involved in acts of impropriety.

This is the culture that we seek to cultivate across society through this Movement. However, this moral regeneration project will only meet the intended goals to the extent that it has optimal support from across the entire spectrum of society. It is not about playing to the gallery for the purposes of narrow, sectarian political point scoring, but about building a truly united, equal and prosperous nation.

Thank you.

Petrol price/VAT increase
18. Mr O J Sefako (North West: ANC) to ask the Deputy President:
Whether the Government has developed any short-term interventions to mitigate the effects of the increase in (a) petrol price and (b) value-added tax, especially in light of the persisting high levels of (i) unemployment, (ii) poverty and (iii) inequality; if not, why not; if so, what are the relevant details? CO475E

REPLY

The increase in fuel prices is a matter of concern to government, its social partners and broader society. Increases in petrol and other fuel prices are mainly due to global factors that are beyond government control.

Some of these factors include the dollar denominated price allocations, political challenges in Venezuela and the imminent US sanctions on crude oil exports from the Islamic Republic of Iran. Unfortunately, the developing economies particularly in Sub Sahara have been the hardest hit.

The Ministers of Energy and Finance are seized with the matter and as indicated by the Minister of Energy in his address to the Portfolio Committee on Energy on 21 August 2018, a Joint Task Team comprising senior officials from the two departments has been set up to come up with proposals on how to alleviate the current situation of fuel hikes.

The Team is expected to report back to the two Ministers by end of September 2018. The Minister of Energy is having engagements with his counterparts in the region with a view of obtaining a more favourable dispensation for South Africa.

We appeal to this House and our people to allow this process to conclude and have the report on what should be done to ease the pressure on South Africans be presented to Cabinet.

Our government has nonetheless taken interventions to address the fuel price increase that came into effect on Tuesday. The projected 25 cents per litre increase was cushioned through the government’s energy slate account that is normally reserved for fluctuations to balance out erratic price movements.

Honourable Members,

Without doubt, the increases in VAT has negatively affected many households. However, government has made necessary provisions to zero rate a number of products for VAT, including brown bread, maize meal, samp, milk, rice, vegetables, eggs and fruits.

For those receiving social grants, government has made a provision for an additional allocation of R2.6 billion over the medium-term expenditure framework in order to effect an above-inflation increase, which will help cushion low-income households from the effects of VAT increase.

Furthermore, the Minister of Finance established an Independent Panel of Experts to consider and review the list of zero rated items. The Panel submitted their report on 6th August this year to the Minister of Finance and it was subsequently released for public comment on the 10th August 2018.

The report recommends the following additional items to be included in the basket of zero rated goods:

(i) White bread, bread flour and cake flour;
(ii) Sanitary products, combined with the free provision of Sanitary products to women and girls;
(iii) School uniforms, subject to further investigation to Clearly demarcate school uniforms; and
(iv) Nappies, including cloth and adult nappies.

For each of the recommended items, the panel suggests that the National Treasury must do further work to ensure that the benefits of zero-rating accrue to consumers. The Minister will then finalise his response to the report of this Panel, taking into account public comments that were received by the deadline of 31st August 2018.

Through this process, the recommendations will be evaluated to ascertain if they have the potential to significantly benefit affected poor households.

Following this process, the Minister of Finance will determine which recommendations to consider for implementation and possible incorporation into current or future tax regime.

Thank you!