THURSDAY, 11 SEPTEMBER 2003 __

                PROCEEDINGS OF THE NATIONAL ASSEMBLY
                                ____

The House met at 14:01.

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

ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS - see col 000.

                 COMMEMORATION OF SEPTEMBER 11, 2001

                         (Draft Resolution)

Mr J DURAND: Madam Speaker, I move without notice:

That the House -

(1) commemorates the tragic events of September 11, 2001, when hijacked aircraft plunged into the towers of the World Trade Centre in New York and shocked the whole world to a standstill;

(2) notes that these acts of terrorism ended the lives of citizens from 82 different countries, including South Africa;

(3) pays tribute to all the innocent victims of these cowardly acts;

(4) recommits itself to the Organisation of African Unity Convention for the Prevention and Combating of Terrorism that was ratified by Parliament in September 2002; and

(5) expresses its agreement with the statement made by the honourable President, Mr Thabo Mbeki, at the United Nations that ``… together we must take the firm position that no circumstances whatsoever can ever justify resorting to terrorism’’. Agreed to.

                 PRESENTATION OF CENSUS 2001 RESULTS

                             (Statement)

The MINISTER OF FINANCE: Madam Speaker and hon members, as a country we have made remarkable progress in the few years of democracy. The programmes that we have put in place have, undoubtedly, been successful.

I am glad to announce to this House today that Census 2001 has been a success and that in their report to me the Statistics Council, a body that has the statutory responsibility of oversight of the statistics system, has asked me to accept the results and promote their utilisation. I am pleased to say to this House today: ``Here are the results. Please use them.’’

You will remember about two years ago, when I addressed this House, I announced that the enumerators would soon be making their way across the country, across the rolling hills of KwaZulu-Natal, up the highlands in the Eastern Cape, through the flatlands of the Northern Cape and through the security-tight suburbs of Sandton to count us in. Then, this House agreed that we needed a census.

Today I bring the results, albeit slightly late. The population of the Republic stood at 44,8 million in October 2001, compared to 40,5 million in

1. Our population has grown by 10% in the five-year period and this gives us an average growth rate of 2% per annum.

We can sketch with passion the census undertaking in our new democracy. Faced with the urgency to end minority rule that had dominated our country for 350 years, we conducted elections in 1994. Census 1996, the first census in which all people were counted as equal citizens, told us how many people there were in our country at that time. Some people, particularly those living in former Bantustans, in informal settlements and on commercial farms, had not been empirically counted since 1970.

After the 1996 undertaking we needed another census to confirm the findings of Census 1996 and to measure changes that had taken place over the time period. Legislation that we introduced in 1999 tells us that the Statistician-General has to call for the census to happen every five years.

South Africa needed Census 2001, and this is the second anchor by which we can reflect on our first decade of democracy. Firstly, Census 2001 tells us how the national picture has changed from 1996 in terms of population size, distribution, density, age and gender.

We know that about 21% of our country’s population lives in KwaZulu-Natal, that isiZulu continues to be the most widely spoken home language in the land, that between 1996 and 2001 the share of the Eastern Cape and Limpopo as a proportion of the total population declined from 15,5% to 14,3% and from 12,1% to 11,7% respectively, and that, conversely, the population of Gauteng witnessed the highest population growth with 1,5 million people added to the province over the five-year period. Indeed, the population of Gauteng grew by 20%, whilst that of the Western Cape grew by 14%. For these two provinces the annual population growth rate over the five years has been 4% for Gauteng and 3% for the Western Cape.

The Northern Cape has had a population decline of about 18 000 over the same period. The other provinces have stabilised and have growth rates of close to 2%. We further know that the population of males is 21,4 million as against 23,4 million females. There are 2 million more females than males, so they are no longer a minority.

Whilst the growth rate of the population has been 10%, the number of households has increased by 23%, with the average household size declining from 4,2 to 3,8 persons in the intercensal period. Households living in formal housing have increased from 57,5% to 63,8% of all households, while those households living in informal housing have remained relatively unchanged at around 16% over the five years.

According to work conducted by Statistics SA on the relative concentration of economic activity for 1996 and 2002, approximately 400 centres were identified and ranked. The results show that Johannesburg continued to dominate her economic space over this period. Cape Town has come in at 93% of the level of economic concentration in Jozi, with Durban scoring 57%, Pretoria 48%, followed by Port Elizabeth at 19% and Pinetown, Germiston and Bloemfontein coming in at around 10% each.

Only 70 of those identified economic spaces are at least more than 1% of what Johannesburg is, with six such centres ranking at 10% or more. The remainder of the centres - 330 or so of them - contribute less than 1%, with, for example, uMzumbe, Dududu, Moutse, Zwelitsha and a place called Bochum-My Darling recording close to 0% in terms of economic concentration in the ranking.

We also know from Census 2001 that there is a relatively large percentage of people who moved out of provinces such as the Eastern Cape and Limpopo, to provinces like the Western Cape and Gauteng.

In the context of the census results in this study, we have instruments that enable us to understand the population growth rates of the provinces of Gauteng and the Western Cape, and pose questions about the long-term implications of this trend, not only for the receiving areas, but for the sending areas, as well.

Some of the questions that can be asked in relation to the findings of Census 2001 are the following: What could be the main reason for the high population growth rates in these two provinces where the growth in population numbers in specific terms has occurred in the said provinces? What is the probable impact of the rapid growth in some provinces and declines in the others? How do these changes inform policy interventions such as the Integrated Sustainable Rural Development Programme, the Urban Renewal Strategy and the Growth and Development Summit Accord?

This, of course, requires serious attention to issues of land; access to land and agricultural production; sustainable rural development, including subsistence farming and food security; accelerated economic growth through local investment and foreign direct investment; skills development and job creation.

Secondly, South Africa needs Census 2001 because it gives us an opportunity to measure progress made by our democratic Government in changing the lives of our people for the better. For instance, in 1996 there were 63,5% households in Limpopo that were using wood as the main energy source for cooking, and that has declined to 59,5% in 2001.

As regards electricity for lighting, access to this facility increased from 57,6% to 69,7% in the five-year period. The percentage of households with access to a telephone, be it a land line and/or a cellular one, increased from 28,8% in 1996 to 42,4% in 2001. Access to piped water now stands at 85%, and such access within 200 metres of a dwelling stands at 72%.

Thirdly, Census 2001 helps us identify those specific areas of development where we need to focus with regard to the implementation of Government programmes. We know that the percentage of households without toilet facilities increased between the two censuses from 12,4% to 13,6%, and that the largest demand for this is in the Eastern Cape. The increase here was from 29,1% to 30,8%. Alternatively, 69,2% of the population still does not have access. Clearly, we need a bigger intervention in respect of public health so that we can curb the spread of waterborne diseases such as cholera and other related diseases.

In the area of education, compared to Census 1996, Census 2001 informs us that the proportion of people without education has declined from 19,3% to 17,9%, while the proportion with tertiary education has increased from 6,2% to 8,4%. [Interjections.] Are you one of them? Lastly, Census 2001 provides our citizens, including researchers, those in Government and nongovernmental organisations and the private sector, an opportunity to engage in an advanced analysis of both Census 1996 and Census 2001. A detailed and thorough analysis will tell us much more about the relationship between these variables and how they change over time because we need to know this. We are a country that has a great appetite for information. We cannot avoid detailed inspection of our most valuable tool for planning, namely our statistics.

The Census 2001 results come in a variety of different products, both in printed and electronic form. Printed products include Census in Brief'', Key Findings’’ and ``How the Count was Done’’. Amongst the electronic products are primary tables, and national and provincial community profiles at the level of cities, local authorities and suburbs and villages, including wards.

We have also played a role in the census. In terms of SADC, South Africa has been assigned the role of being the co-ordinator and focal point of census. In this regard, I am pleased to announce that Zambia and Mauritius conducted their census in 2000; South Africa, Botswana and Namibia in 2001; and, finally, Tanzania and Zimbabwe ran theirs last year. We expect Angola and the DRC to run theirs before 2005, while Lesotho, Malawi, Mozambique and Swaziland will conduct theirs in the second half of the decade as per their schedule.

In terms of legislation South Africa is scheduled to conduct the next census in 2006. That gives the SADC region and the founding protocols of SADC a relatively stable source of information, because the region collaborated and adopted common approaches to the census, including common questions. We have indeed empowered ourselves as a region.

In doing what the Statistics Council has asked me to do, I would like to highlight some of the points that the council makes in terms of the Act. Listen, I will give you something to read. I will give you a file with the letter from the Statistics Council, Mr Mac what? Makhathini? No? [Laughter.]

The council recommends to the Minister that he support the release of Census 2001. The statement by the Council is in the pack, and I would like members to read the statement. Like any other developing country, South Africa is searching for its position in the information age. As we do so, we need to deal with the issues of costs and benefits. Do we want to spend R1 billion every five years collecting census data? What are the benefits of doing so? What are the risks of failing to do so? All these questions need to be answered by us, and I think Parliament would be exceedingly important in this regard.

Statistics SA is just implementing the mandate with which we have entrusted them by means of an Act of Parliament. The consultative process has started with regard to whether Census 2006 should be conducted or not, and the Statistics Council will advise the Statistician-General and me after 2 October this year. We are one of the few countries that take five-yearly censuses in the world, and, in fact, we are the only one on the African continent.

Statistics SA has done it again. I know that they normally say this when they take the blame, but this time they have done something well. I would like this House to join me in congratulating the Statistician-General, Mr Pali Lehohla, and the Statistics SA management on the good work done. [Applause.] I also want to extend my gratitude to the Statistics Council whose chairperson, Dr Hilary Southall, is in the box here today and whose members have put in hours and hours of work to make Census 2001 a reality.

Finally, I would like to thank this House for affording Statistics SA an opportunity to bring the census results to the National Assembly. Thank you very much. [Applause.]

Dr P J RABIE: Madam Speaker, hon Minister, hon members, the October census conducted in 2001 was the second census conducted in democratic South Africa.

The estimated figure is that we have a total population of 44,8 million people as against the figure of 40,6 million in 1996. The Statistics Council in a presentation to Parliament mentioned that there is a possibility of an undercount. The post - enumeration survey revealed that as many as one in six people were missed in the census. It can be said that the broad estimate of the South African population is fairly accurate. Some figures regarding the composition of the population by gender, age and population groups may not be representative of actual figures. The labour market statistics date back to October 2001 and differ considerably from those published in the September 2001 labour force survey, in that the labour force participation rates are lower, unemployment is higher and employment levels are lower in the census. It is extremely important that the South African Statistics investigate these differences.

It is imperative that official South African statistics reflect the true empirical picture at ground level. South Africa will only be able to eradicate poverty and generate economic growth if a need analysis is based on accurate representative data.

Sensus 2001 behoort van groot waarde vir alle instansies in die privaat- en openbare sektor te wees. ‘n Magdom van definisies en verduidelikings rakende die demografie, landelike-stedelike migrasie en ouderdomsprofiele word verskaf. Die DA reken dat ‘n basisdokument daargestel is wat as agtergrond kan dien vir die volgende sensus wat in 2006 opgeneem sal word. Die rekenaarprogramme wat aan lede van die Parlement deur Statistics SA gegee is, behoort van waarde te wees binne hulle konstitusionele bedieningsgebiede. Op ‘n ligter trant, die agb Minister het gepraat van Boggem Darling''. Ek sal baie graag wil weet waarBoggem Darling’’ is.

‘n Ander aspek wat belangrik is, is dat daar soos in die res van die ontwikkelende wêreld verstedeliking in Suid-Afrika vanaf landelike na stedelike gebiede plaasvind. (Translation of Afrikaans paragraphs follows.)

[Census 2001 should be of great value to all institutions in the private and public sectors. A host of definitions and explanations regarding the demographics, rural and urban migration, as well as age profiles is provided. The DA is of the opinion that a basic document was created which could serve as background for the next census which will be conducted in

1. The computer programmes that were given to members of Parliament by Statistics SA should be of value within the constituencies that they serve. On a lighter note, the hon Minister spoke about Boggem Darling''. I would really like to know whereBoggem Darling’’ is.

Another aspect of importance is that urbanisation occurs in South Africa, as in the rest of the developing world, from rural to urban areas.]

Gauteng and the Western Cape are two provinces that have gained residents in this regard. South Africa is part of the SADC region and it is important that we give guidance regarding the completion of census methodology. I think that’s the future of the whole southern development region.

The cost factor of R1 billion in future was mentioned by the hon Minister. It is important that we investigate whether we can afford it or not. My considered opinion is that it is extremely important that we conduct another survey. It can lead to a culture of statistics for this particular country. Madam Speaker, I thank you. [Applause.]

Dr G G WOODS: Madam Speaker, the IFP welcomes the census results for 2001 and we are fascinated by much of the information. I think it’s very pleasing to see the improvements across very important issues such as water, electricity, telephones, etc. Like Dr Rabie before me, there are some issues we need to look at a little more closely, the unemployment figures in particular.

I think we have confidence in the census information that has been released, notwithstanding some anxieties we’ve had over recent months regarding the quality of the census. There was speculation about certain methodologies. Some of these issues, I believe, came up yesterday in the presentation by Stats SA, but the adjustments and the accommodations of those small problems seem to have been taken care of. We also recall after the Stats SA inflation data problems, there were issues of capacity and expertise at Stats SA, but there again, I believe the Minister has taken steps to remedy that. So, we do have a growing confidence. I think the accumulated experience over the past two censuses is going to help us in going forward with the next census.

Also, congratulations to Stats SA on the time they’ve taken to assimilate, analyse and produce the data which was that much quicker than the previous census. Then I’d also like to mention that I think the new products and information have been produced and packaged in a most useful form. This is very helpful for Government policy-makers, especially across social policy areas and the transformation thereof that I mentioned. However, as was said yesterday, products such as ``My Constituency’’ consist of a census digital atlas, the likes of which could be very useful to us as members of Parliament. We should have an interest in these issues. Not only does it help us to oversee departments in what they do and how they’re succeeding, but also in the party-political context itself; that information can help us partake in party positions, in our constituency work and even in electioneering.

So let me join the Minister in congratulating Mr Lehohla and his team at Stats SA, as well as the Stats Council for producing this information for us. Thank you. [Applause.]

Dr W A ODENDAAL: Agb Speaker, die geloofwaardigheid van Statistiek SA het in die jongste tyd ‘n ernstige knou gekry. Die onprofessionele fout wat tot onlangs toe by die berekening van die verbruikersprysindeks gemaak is en die slordige wyse waarop die departement met finansies omgaan, soos wat verlede week deur die Staande Komitee oor Openbare Rekenings aangehoor moes word, laat ‘n mens wonder of daar nie ook maar net slordig met syfers omgegaan word nie. Geen behoorlike beplanning kan gedoen word sonder behoorlike en betroubare statistiek nie.

Die inligting wat vrygestel is, toon nietemin dat Suid-Afrika ‘n tydperk van positiewe ontwikkeling deurmaak wat deur enkele teenstrydige, negatiewe tendense, tipies aan ‘n ontwikkelende ekonomie, vernietig kan word indien die probleem nie betyds effektief aangespreek word nie. Dit sluit in dat welvaart wel geskep word, maar dat die gaping tussen ryk en arm steeds kommerwekkend vergroot, dat nuwe werkgeleenthede teen ‘n volgehoue, matige tempo geskep word, maar dat die werkloosheidsyfer onder alle bevolkingsgroepe steeds styg en reeds onrusbarende vlakke bereik het, dat die geletterdheidsvlak onder alle bevolkingsgroepe besig is om bevredigend te styg, maar dat die vaardigheidsvlakke in die professionele en vakmansberoepe besig is om weens emigrasie teen ‘n ontstellende tempo af te neem en dat hierdie tendens grootliks deur die staat onderskat word.

Die Nuwe NP is van oordeel dat die ontwikkelingsprobleme wat deur Statistiek SA uitgewys is, opgelos kan word deur die positiewe makro- ekonomiese klimaat wat tans in Suid-Afrika heers te benut om verbeeldingryke werkskeppingsprogramme van stapel te stuur. Dit is duidelik dat die informele en kleinsakesektor ‘n veel belangriker rol in werkskepping te speel het as wat dit tans doen. Dit is ook duidelik dat ‘n omvattende vaardigheidsplan van stapel gestuur sal moet word om produktiwiteit te verbeter, maar veral om werklose mense gereed te maak vir suksesvolle toetrede tot die arbeidsmark. Die Nuwe NP verwelkom die vrystelling van hierdie belangrike naslaanwerk. (Translation of Afrikaans speech follows.)

[Dr W A ODENDAAL: Hon Speaker, the credibility of Statistics SA suffered a serious blow recently. The unprofessional mistake which was made with the calculation of the consumer price index until recently, and the sloppy manner in which the department deals with finances, as was heard last week by the Standing Committee on Public Accounts, make one wonder if figures are not also simply handled in a sloppy manner. No proper planning can be done without proper and reliable statistics.

Nevertheless the information that was released, shows that South Africa is experiencing a phase of positive development that can be destroyed by a few contradictory, negative trends which are typical of a developing economy, if the problem is not addressed timeously and efficiently. These include that prosperity is indeed created, but that the gap between rich and poor is still growing at an alarming rate, that new job opportunities are being created at a sustainable, moderate pace, but that the unemployment rate among all population groups is still increasing and has already reached alarming levels, that the literacy levels among all population groups are increasing satisfactorily, but that the skills levels in the professional and vocational occupations are decreasing at a shocking rate because of emigration and that this trend is significantly underestimated by the state.

The New NP is of the opinion that the development problems identified by Statistics SA can be solved by using the positive macroeconomic climate currently prevailing in South Africa to launch imaginative job-creation programmes. It is clear that the informal and small business sector should play a far more important role in job creation than it is now. It is also clear that a comprehensive skills plan will have to be launched in order to improve productivity, but especially to prepare unemployed people for successful entry into the job market. The New NP welcomes the publication of this important reference work.]

Mnr A BLAAS: Speaker, die inligting versamel en verwerk uit Sensus 2001 het baie besliste waardes en sal bydra tot ‘n sinvolle en doelgerigte beplanning deur verskeie sektore van die gemeenskap. Van die bevindings is teenstrydig met verwagte uitkomste en tendense in vergelykbare omstandighede. Dit impliseer nie dat dit noodwendig verkeerd is nie, maar dui aan dat dit met versigtigheid hanteer moet word en moontlik verdere navorsing benodig.

Die land vra ook dat die diepte van opname verdere uitgebrei word en vir ‘n opgeleide span werkers. Die vraag is, moet die volgende sensus oor dieselfde diepte beskik of moet daar nie meer spesifiek net gekyk word na dit wat prioriteite is in terme van populasie en huishoudelike tellings nie? Dit kan moontlik ook meer akkurate inligting waarborg.

Die ACDP vereenselwig hulle met die sentimente wat uitgespreek is teenoor die departement vir die goeie taak wat hulle gedoen het, en net ter inligting, die mikroskywe waarop die inligting aan ons beskikbaar gestel is, is tegnologies ver bo wat ons het. Ons het nog nie sover opgegradeer nie, en gevolglik kan ons nie van daardie elektroniese hulpmiddel gebruik maak nie. Ek dank u. (Translation of Afrikaans speech follows.)

[Mr A BLAAS: Speaker, the information gathered and processed from census 2001 has very conclusive values, and it will contribute to meaningful and goal-oriented planning by various sectors of the community. Some of the findings contradict the expected outcomes and tendencies in comparable circumstances. This does not imply that it is necessarily wrong, but indicates that it should be handled with caution and that possible further research is needed.

The country asks for a trained team of workers, and that the depth of the survey must be expanded. The question is, must the next census have the same depth, or should one not be look at priorities in terms of population and domestic counts? It can possibly guarantee more accurate information.

The ACDP identifies with the sentiments expressed to the department for a job well done, and just for information, the microdiscs on which the information has been made available to us, are way ahead of what we have in terms of technology. We have not yet upgraded and consequently we cannot make use of that electronic aid. I thank you.]

Mnr P J GROENEWALD: Agb Mevrou die Speaker, die sensus het nie sonder probleme begin nie. Inteendeel, in die begin was daar nie Afrikaanse vorms beskikbaar nie, en ek moet vir die agb Minister sê hy het ‘n goeie voorbeeld ook vir ander Ministers gestel, want nadat die Vryheidsfront se prokureursbrief op sy lessenaar beland het, was die Minister onmiddellik bereid om met ons ‘n gesprek te voer. Ooreenkomstig die Grondwet het hy dan ook Afrikaanse vorms en ook vorms in ander tale beskikbaar gestel, en daarom sê die Vryheidsfront die agb Minister het ‘n goeie voorbeeld gestel vir ander ministers. Ons verwelkom dit.

Daar is probleme, maar ek dink dat die statistiek oor die algemeen waardevolle inligting kan wees. Daar is baie mense wat sê hulle is nie getel nie. Ek is een van die lede wat nie getel is nie, want niemand het by my uitgekom nie, maar nou sê die agb Minister daar is ‘n foto van my geneem, so ek was dus twee keer getel, want my huis in Stilfontein is, geneem, asook dié by Akasiapark. So, ek is óf twee keer getel, óf glad nie. Dankie, Mevrou die Speaker. [Tussenwerpsels.] (Translation of Afrikaans speech follows.)

[Mr P J GROENEWALD: Hon Madam Speaker, the census did not start without problems. On the contrary, in the beginning there were no Afrikaans forms available, and I must say to the hon Minister that he has set a good example to other Ministers, because after the letter from the Freedom Front’s lawyer landed on his desk, the Minister was immediately prepared to hold a discussion with us, and in compliance with the Constitution, he then made forms available in Afrikaans and also in other languages, and therefore the Freedom Front is saying that the hon Minister has set a good example to other Ministers. So, we welcome this.

There are problems, but I think that the statistics, in general, can provide valuable information. There are many people who are saying that they have not been counted. I am one of the members who has not been counted, because nobody came to me, but now the hon Minister is saying a photograph was taken of me, so I was counted twice, because my house in Stilfontein was photographed, as was the one in Acacia Park. I have thus either been counted either twice or not at all. Thank you, Madam Speaker. [Interjections.]]

Miss S RAJBALLY: Thank you, Madam Speaker. The Minority Front expresses its satisfaction with the Minister of Finance’s involvement in Census 2001. We further express our satisfaction with the South African Statistics Council on its involvement in Census 2001.

Our immense responsibility as Government is always noted in our endeavours, but it is statistics such as Census 2001 that pronounce the size of our responsibility and the reality of the South African situation.

The MF has no objection as to how the count was done, and judging from the reports and the statement by the South African Statistics Council on Census 2001, the method certainly boasts constitutionality in the light of transparency and independence from the Government, and the process is encouraging in the light of accuracy.

The MF feels encouraged and determined to deliver, having noted the statistics provided by the census. The MF feels that Census 2001 has made our strengths, weaknesses and existence a reality. It is hoped that this shall invest greater determination in delivering a better South Africa. Hopefully the census to come and our promising Government would be able to deliver statistics to a better South Africa. Thank you.

Mnr C AUCAMP: Agb Speaker, ek wil my aansluit by die agb Groenewald in sy bedanking aan die Minister, maar ek wil darem vir hom sê die Minister het aan my persoonlik die versekering gegee dat die Afrikaanse vorms nog lank voor die dreigende hofaksie sal kom.

Spesiale dank vir die elektroniese skywe wat ons ontvang het van die Minister. Ons verwelkom ook die offisiële bekendstelling van hierdie groot projek. Betroubare statistiek is ononderhandelbaar as ons regtig al die vraagstukke van die land wil aanspreek en daarvoor beplan.

Die Minister vra ‘n baie belangrike vraag in sy voorlegging aan ons vandag. Wat is die beste metode? Is dit nodig om elke vyf jaar so ‘n omvattende fisiese sensus te hou? Dis ‘n relevante vraag. In die elektroniese eeu waarin ons leef, is daar dalk sekerlik beter metodes as die fisiese deur- tot-deur sensus wat tot nou toe as die enigste wyse gesien is. Die hele risiko van ondertellings en al die drama wat met ‘n sensus gepaard gaan, ook die uitdeling van kondome wat daarmee gepaard gegaan het, kan dan sommer ook vermy word. Ons sien uit na die uitslag van hierdie ondersoek wat die Minister wil hou, om te kyk of ons dalk met alternatiewe metodes in hierdie tegnologiese eeu ook dieselfde resultate kan bereik.

Ons dank vir die sensus. Ons glo dat dit gebruik kan word tot voordeel van almal in Suid-Afrika. Baie dankie. (Translation of Afrikaans speech follows.)

[Mr C AUCAMP: Hon Speaker, I want to join the hon Groenewald in thanking the Minister. However, I want to tell him that the Minister has personally given me the assurance that Afrikaans forms will be available long before the impending court action.

A special thanks for the electronic discs that we received from the Minister. We also welcome the official introduction of this big project. Reliable statistics are non-negotiable if we really want to address and plan for all the issues of this country.

The Minister has asked an important question in his submission to us today. What is the best method? Is it necessary to have such a comprehensive physical census every five years? That is a relevant question. In the electronic age that we are living in there must surely be better methods than the physical door-to-door census which has been seen as the only way up to now. The whole risk of not counting properly and all the drama associated with a census, also the handing out of condoms that was involved, can then also be avoided. We look forward to the results of the investigation that the Minister wants to have to see, if in this technological age we can’t achieve the same results with alternative methods.

We are grateful for the census. We believe it can be used to the advantage of everyone in South Africa. Thank you.]

Ms S B NQODI: Madam Speaker and hon members of the House, let me first acknowledge the fact that, as it happens, in all other countries, given the nature of all official statistics, the final census estimates do not completely accurately reflect the true number of the people in a country at the end of the operation of the census.

I was impressed to note that this is the view also shared by the South African Statistics Council. Recognising the importance of a census, this is not only a challenge to Statistics SA and Government, but also a challenge to all of us who understand the reasons for being enumerated on a five- yearly basis.

The ANC members in this House welcome and commend Statistics SA for the exhaustive effort they put in in undertaking this cumbersome operation and for providing us with the almost 100% accurate product of the census results which truly reflect the population estimates of all sectors of our communities in this country. I am also certain that all members of our portfolio committee were satisfied during our recent visits to the offices of Statistics SA in Pretoria with their adherence to professional international standards regarding data collection, processing, analysis, documentation and storage of data.

Given the magnitude of the intensity and the accurate counting process that you and your enumerators had to go through, we are really proud of your product - I am referring now to the Statistician-General. I also wish to mention our appreciation for the work done by our enumerators. We thank them for the successful results and for sacrificing their leisure time and risking all odds by participating in the head count of our population. As a committee we truly appreciate the fact that the limited human and financial resources, together with the skills backlog, had to a large extent contributed to the delay in, the publication of these results by Stats SA. We are equally mindful of their commitment to publishing correct, accurate, user-friendly and reliable data. We thank them for that.

Proper planning, informed by the true demographics of this country, is what the ANC-led Government strives to achieve. Accurate and reliable data, which is informed by the findings of Census 2001, is a useful analytical tool which policy-makers in the three spheres of Government need. The comprehensive statistical data provided by the results of Census 2001 is surely a measurement of our population growth five years after our first all-inclusive counting of our people in 1996 in this first democratic Government. Once again we are happy to be provided with a true reflection of empirical facts, and not just mere unscientific estimates of the total number of our population size as per municipality area, province, gender, age, ethnic and racial divide. As the Minister alluded to, through these findings we can now evaluate and assess progress made in realising the objectives of our government policies and programmes which, among other things, seek to improve the quality of life of all people in this country, to bridge and narrow the gaps, imbalances and inequities which we have inherited from the apartheid regime which, through its deliberate barbaric policies of racial segregation, discounted a large number of our people who were driven out of the highly developed, civilised and industrialised towns and cities to the dry, poor, unproductive and arid so-called Bantustans in the land of their birth. Through these findings we are able to correct the proportion of the population size of the poor and the homeless who roam our streets and who are squashed into matchbox-size corrugated iron shacks in squatter areas which proliferate on a daily basis on the periphery of the comfortable and spacious dwellings of our former colonisers and oppressors.

Since 1996, for the very first time in this country, a true picture of where and how the majority of black people are or live has been given to the world. For the very first time, the poor and the jobless know that they are also counted in the statutory books of our country.

This definitely means a lot to them as it puts their plight and suffering right at the doorstep of our Government, a government which they enthusiastically voted for and also put in place. In line with our policy objectives in the Reconstruction and Development Programme, government planning will be informed by a true reflection of gender and age disaggregated data which show or tell us the population size, density and distribution of each and every province and local authority in South Africa. This is necessary as it is an enabling economic and budgeting tool for Government as a whole. It will help us as Parliament to pass well- informed and targeted budgets in all three spheres of Government.

Hopefully this will help accelerate delivery, and bridge or narrow the gaps between our taxpayers by addressing the imbalances that continue to grow between provinces, urban and rural areas and racial groupings in the country. Surely this is what this Government aims for, and it is the reason why it is in place. These census results confirm this Government’s policy priorities which, among others, seek to promote an integrated rural development and urban renewal strategy which will help improve the conditions and living standards of our rural and township communities, thereby alleviating the exodus of especially the economically active citizens and skilled young male entrepreneurs from the rural to urban areas.

The 20% population growth of Gauteng and the 14% growth of the Western Cape will surely sound morning warning bells for us as policy-makers. It is a wake-up call for the policy-makers, planners and implementers in this province. We now know and understand why, almost every week, a new squatter camp is mushrooming next to an affluent suburb of our industrialised provinces.

Hopefully through these results the question of the need for the promotion of gender equality will also be better understood and appreciated, even by the most stubborn male chauvinists who continue to suppress the majority of our electorate, namely women, in all aspects of life. The results tell us that there are two million more females than there are males in South Africa today. This emphasises and justifies the fact that women empowerment and emancipation, together with rural development where most women are concentrated, is both a policy and moral obligation for this Government. We commend the ANC-led Government for acknowledging, through its gender- sensitive programmes and legislation, that much still needs to be done in addressing the cause of the poor rural women.

The challenge of skills development programmes and the improvement of our education system, in such a way that it responds to the needs and interest of our youth, cannot be underestimated, given the fact that the age distribution reflects that we have a relatively young population in this country and that, despite the importance of computer literacy in the world today, only 2% of African-headed households have a computer, as compared to 46% of white-headed households. Madam Chairperson, we commend and accept the report presented to us. Thank you. [Time expired.]

Debate concluded.

              SECOND ANNIVERSARY OF SEPTEMBER 11, 2001

                        (Member's Statement)

Dr A N LUTHULI (ANC): Thank you, Madam Speaker. The ANC statement reads thus: This Thursday marks the second anniversary of the September 11 attacks on the USA, where thousands of people died and others were injured when aircrafts plunged into the Twin Towers buildings at the World Trade Centre.

The African National Congress strongly condemns all forms of terrorism. We condemn also all unilateral actions to solve global problems. We would like to reiterate our position that the responsibility of the United Nations with regard to issues of international peace and security and the peaceful resolution of international conflicts must be respected by all. We call upon all nations and governments to respect the United Nations and to refrain from unilateral action in the fight against international terrorism.

We urge all countries to contribute to the goal of creating a better world by adhering to the principle and practice of multilateralism, and acting at all times in a manner that promotes global peace and security. Thank you. [Applause.]

                      DA'S BY-ELECTION RESULTS

                        (Member's Statement)

Mr J SELFE (DA): Madam Speaker, it is about time that Parliament and the public were informed about the interesting by-election results over the past few weeks. [Interjections.]

The DA is winning increasing support and votes while the ANC is suffering significant setbacks. The New NP has all but ceased to exist. In the by- elections in Kimberley, Stellenbosch, Buffalo City, Pietermaritzburg and Nelspruit, the DA won convincingly by giving the ANC a real thrashing. In Cloetesville, the DA lost to the ANC by only four votes and, in Mohale City, an ANC stronghold, the ANC dropped from 77% in 1999 to 68%, while the DA grew from 10% to 29%.

In all wards fought by the New NP, they lost hopelessly. They are no longer a political factor. Next year’s election will be a fight between the DA and its allies on the one hand, and the ANC on the other. I thank you. [Applause.]

                       LANGEBERG BY-ELECTIONS

                        (Member's Statement)

Mnr R D PIETERSE (ANC): Speaker, die African National Congress het op 27 Augustus 2003 die tussenverkiesing in Albertinia in die Langeberg- munisipaliteit met ‘n oorweldigende meerderheid van 61% teenoor die powere 39% van die DA gewen. [Tussenwerpsels.]

Dit het gebeur, ten spyte van die feit dat die huidige burgemeester van die Langeberg-munisipaliteit, mnr Theuns Botha, die provinsiale leier van die DA is. Die provinsiale leier is ook bygestaan deur die agb Tony Leon, Joe Seremane en Kraai Van Niekerk. Die enigste persoon wat nie daar was nie, was die Speaker. Al die DA se leiers was daar, en die mense het hulle so gekyk en gesê: Vandag gaan ons hulle trap. En ons het hulle ook op hulle nek getrap. Ons het hulle gewen met 61%. [Applous.]

Die ANC glo hierdie oorwinning illustreer dat die mense van die Wes-Kaap moeg en fed-up is vir die DA se swart gevaar'', slaan terug’’, ``die Zimbabwiese veldtog’’ en alles wat negatief is, en met die res van Suid- Afrika wil saamwerk en verenig vir ‘n nie-rassige en demokratiese Suid- Afrika. Die ANC doen ‘n beroep op alle Suid-Afrikaners om te veg teen rasse- polarisasie, en om ter wille van eenheid en nie-rassigheid mekaar onder die vaandel van die ANC te omarm.

By the way, Speaker, die ANC het ook die tussenverkiesing in Stellenbosch gewen, wat ‘n vesting was van die DA, so die … (Translation of Afrikaans member’s statement follows.)

[Mr R D PIETERSE (ANC): Speaker, on 27 August 2003 the African National Congress won the by-election in Albertinia in the Langeberg Municipality with an overwhelming majority of 61%, compared with the meagre 39% of the DA. [Interjections.]

This happened in spite of the fact that the present mayor of the Langeberg Municipality, Mr Theuns Botha, is the provincial leader of the DA. The provincial leader was also assisted by the hon Tony Leon, Joe Seremane and Kraai van Niekerk. The only person who was not there was the Speaker. All the leaders of the DA were there, and the people took one look at them said: Today we are going to walk all over them. And we really did walk all over them. We beat them with 61%. [Applause.]

The ANC believes that this victory illustrates that the people of the Western Cape are tired, fed-up with the DA’s swart gevaar'' [black danger], slaan terug’’ [fight back], the Zimbabwean campaign and everything that is negative, and that they want to co-operate with the rest of South Africa and unite for a nonracial and democratic South Africa. The ANC appeals to all South Africans to fight against racial polarisation and to embrace unity and nonracialism under the banner of the ANC.

By the way, Speaker, the ANC also won the by-election in Stellenbosch, which used to be a bastion of the DA, so the …]

The SPEAKER: Thank you, hon member.

Mr R D PIETERSE: … so die ``statement’’ was verkeerd. Dankie. [… so the statement was incorrect. Thank you.] [Applause.]

The SPEAKER: Thank you, hon member.

                            DEATH PENALTY

                        (Member's Statement) Dr B L GELDENHUYS (New NP): Madam Speaker, the sheer  brutality  with  which murders are being committed in South Africa has now forced  the  New  NP  to call for the re-opening of the debate on the death penalty in a  responsible manner.

When a young girl gets gang-raped on the Cape Flats and then stabbed 14 times, we believe that the death penalty is the only suitable sentence. We also believe that it will serve as a deterrent against other crimes of a similar nature. Of course, the death penalty is not the only solution.

Scientific research regarding the causes of the violent nature of crime is long overdue and, hopefully, the hon Minister of Safety and Security will take the initiative in this regard.

Speaker, intussen vind die Nuwe NP die DA se eierdans oor die doodstraf amusant. Toe die DA-leier in ‘n onbewaakte oomblik verklaar dat die doodstraf moet terugkom, word hy onmiddellik gerepudieer deur die doyenne van liberale denke in Suid-Afrika, Helen Suzman. Terselfdertyd wonder ‘n politieke kommentator of die DA nie miskien sy liberale waardes verloor het nie. Die DA is dit aan die Suid-Afrikaanse kiesers verskuldig om presies te sê waar hulle staan met betrekking tot die herinstelling van die doodstraf. [Tussenwerpsels.] [Applous.] (Translation of Afrikaans paragraph follows.)

[Speaker, in the meantime the New NP finds the egg-dance of the DA with regard to the death penalty amusing. When the leader of the DA stated in an unguarded moment that the death penalty should be reinstated, he was immediately repudiated by the doyenne of liberal thought in South Africa, Helen Suzman. At the same time a political commentator wondered whether the DA was not perhaps losing its liberal values. The DA owes it to the South African electorate to say exactly where it stands with regard to the reinstatement of the death penalty. [Interjections.] [Applause.]]

                HEALTH CONDITIONS IN THE EASTERN CAPE

                        (Member's Statement) Adv Z L  MADASA  (ACDP):  Somlomo,  iziphumo  zobalo  lwabantu  neenkcukacha ezihamba nalo zibonakalisa  ukuba  iphondo  laseMpuma  Koloni  lihamba  emva kwezempilo. Utshilo noMphathiswa wezeMali namhlanje.  Ezi  ziphumo  zingqina ingxaki abakuyo abantu baseMpuma Koloni. Badliwa  yindlala,  abanamisebenzi, yaye uninzi  lwabo  lusezilalini.  Ezempilo  nezibhedlele  azikhathalelwanga ngokwendlela ebekumele ukuba kwenziwa ngayo kweliya phondo.

I-ACDP ihlaba ikhwelo kurhulumente waseMpuma Koloni ukuba aphucule ngokukhawuleza imeko yezibhedlele kweliya phondo ukuze abantu bangabulawa zizifo ezinokunyangeka. Enkosi. [Kwaqhwatywa.] (Translation of isiXhosa member’s statement follows.)

[Adv Z L MADASA (ACDP): Madam Speaker, census results show that the state of health and hospitals in the Eastern Cape is in total collapse. The Minister of Finance alluded to that today. These results are a clear indication of the extent of the problems that face people of the Eastern Cape. They are hungry and unemployed, and the majority of them live in rural areas. There is mismanagement throughout the health sector and hospitals in that province.

The ACDP is calling on the government of the Eastern Cape to double their efforts and introduce mechanisms that would improve the conditions of hospitals there as soon as possible before people die from incurable diseases. Thank you. [Applause.]]

                   MORAVIAN CHORISTERS IN ACCIDENT

                        (Member's Statement)

Mnr D A A OLIFANT (ANC): Mevrou die Speaker, die Morawiese kerk het ‘n besondere rol gespeel in die bevrydingstryd in ons land. Teen hierdie agtergrond was dit dan ook heel gepas dat die kerk besluit het om verhoudings oor die grense van ons land te verbeter. Die afgelope aantal jare het dié kerk besluit om deur middel van hul basuinskoor jaarliks ‘n koorfees te hou waaraan hulle en ander lande in Suider-Afrika deelneem. Hierdie jaar was Namibië die gasheer, en na ‘n baie suksesvolle naweek van ‘n hoogstaande koorfees het hulle baie opgewonde terug gekeer huis toe om die wonderlike ervaring met die plaaslike gemeentes en families te deel. Ongelukkig het hulle nooit die huis gehaal nie. Hulle word van hulle kosbare en talentvolle lewens beroof deur ‘n tragiese en ontydige ongeluk wat Maandag, 8 September, net buite Nuwerus plaasgevind het.

Namens die ANC, en in die besonder die Blouberg-Noordstreek, wat Mamre, Pella, Atlantis en Witsand insluit, wil ons ons diepste meegevoel uitspreek teenoor die Morawiese kerk in die Wes-Kaap, die gesinne van die ontslape Jacques en Randall Adonis, Gain Goodall van Mamre, Mark Davids van Pella, Albert en Jerome Engel van Steenberg, Jeffrey Joemat van Bellville en Rone Morkel van Wynberg. Ons wens die families sterkte toe in hierdie donker uur van emosionele lyding. Ons wil net vir u sê: Moenie bekommerd wees nie. Ons liewe Jesus sal hierdie wonde van u genees, net soos Hy soveel andere s’n genees het. Laastens word dit verwelkom dat daar hierdie week ‘n konferensie deur is verkeersamptenare gehou is om te kyk hoe om die slagting op ons paaie te verminder en te verhoed. [Applous.] (Translation of Afrikaans member’s statement follows.)

[Mr D A A OLIFANT (ANC): Madam Speaker, the Moravian Church played an important role in the liberation struggle in our country. Against this background it was also most fitting that the church decided to improve relations across the borders of our country. During the past few years this church decided, by means of their own brass band, to hold an annual choir festival in which other countries in Southern Africa participate. This year Namibia was the host, and after a very successful weekend of an outstanding choir festival, they returned home very excited, to share the wonderful experience with the local congregations and families. Unfortunately they never made it home. They were robbed of their precious and talented lives by a tragic and untimely accident on Monday, 8 September, just outside Nuwerus.

On behalf of the ANC, and in particular the Blouberg North region, which includes Mamre, Pella, Atlantis and Witsand, we would like to convey our deepest sympathy to the Moravian Church in the Western Cape, to the families of the deceased Jacques and Randall Adonis, Gain Goodall of Mamre, Mark Davids of Pella, Albert and Jerome Engel of Steenberg, Jeffrey Joemat of Bellville and Rone Morkel of Wynberg. We wish the families all of the best in this dark hour of emotional suffering. We just want to tell you: Don’t worry. Our dear Jesus will heal these wounds of yours, just as He healed those of so many others.

Finally, it is welcomed that a conference of traffic officials was held this week to see how the carnage on our roads could be reduced and avoided. [Applause.]]

                  THE CASE OF NIGERIA'S AMINA LAWAL

                        (Member's Statement)

Miss S RAJBALLY (MF): Madam Speaker, in March 2002 Amina Lawal, a Muslim woman in Nigeria, was found guilty of adultery and of having a child out of wedlock. Under the so-called Sharia law of Nigeria, the crime of adultery carries the punishment of death by stoning. The court appeal by Amina Lawal has been postponed repeatedly and is now set for 25 September 2003 in Katsina state, Nigeria.

It is important to note that Nigeria is party to international human rights instruments which prohibit punishment and torture, such as the UN Convention against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment, also referred to as the convention against torture, as well as the International Covenant on Civil and Political Rights. Nigeria is also party to the Convention on the Elimination of All Forms of Discrimination against Women.

Noting this and the matter of Amina Lawal, it is felt that the sentence of stoning to death is a major contravention of the above principles. The MF calls on the House to appeal to the Nigerian authorities to guarantee the physical and psychological integrity of Amina Lawal and her family; voice our opposition to all forms of torture, cruel, inhumane and degrading treatment and punishment; call for a guarantee of human rights for women and that international and national standards for human rights be upheld; call on the state of Nigeria to bring forward the father of Amina Lawal’s child so that he could take responsibility for his actions and marry Amina Lawal, and take full care of her and the child. [Applause.]

                      VALIDATION OF PROPERTIES

                        (Member's Statement)

Mnr C AUCAMP (NA): Mevrou die Speaker, die Nasionale Aksie vereenselwig hom heeltemal met die agb Boy Geldenhuys se siening oor die doodstraf. Ons sê: Vang hulle en hang hulle!

Die Nasionale Aksie versoek die Minister van Finansies om sy diskresie ingevolge artikel 29(8) van bylaag 8 van die Wysigingswet op Inkomstebelasting te gebruik om die tydperk waarbinne eiendomswaardasies vir doeleindes van kapitaalwinsbelasting op bestaande eiendomme aanvaar kan word, van twee tot drie jaar te verleng, by wyse van afkondiging in die Staatskoerant soos vereis. Die tydperk van twee jaar verstryk op 30 September. Indien die Minister gevolg gee aan die versoek van die Nasionale Aksie, sal dit aan die eienaars van vaste eiendom nog een jaar gee om waardasies te bekom.

Ons motiveer die versoek soos volg: Die praktyk toon dat die aanvanklike twee jaar nie genoeg was nie en ‘n baie lae persentasie van eiendomme is tot op datum waardeer. Daar is te min gekwalifiseerde waardeerders om betyds in die aanvraag te voorsien. Dit lei daartoe dat mense self hulle eiendomme waardeer, welke waardasies individueel deur SARS betwis kan word. Die proses van invordering kan sodoende vertraag word en kan lei tot ‘n verlies aan BTW.

Die billikheidsbeginsel kom in gedrang indien eienaars weens fisiese omstandighede nie in staat was om aan die wet te voldoen en dan noodgedwonge ongelyk behandel word. Dit sal ook die geleentheid bied vir verdere bewusmakingsveldtogte deur SARS en die uitstel van die afsnydatum vir bestuurslisensies dien as ‘n goeie analogie. Dit het orde herstel. Ons verneem graag wat die Minister se antwoord hierop is. (Translation of Afrikaans member’s statement follows.)

[Mr C AUCAMP (NA): Madam Speaker, the National Action associates itself completely with the hon Boy Geldenhuys’s view on capital punishment. We say: Catch them and hang them!

The National Action requests the Minister of Finance to use his discretion in terms of section 29(8) of Schedule 8 of the Income Tax Amendment Act to extend the period during which property valuations for the purposes of capital gains tax on existing properties may be accepted from two to three years by promulgation in the Gazette, as required. The period of two years expires on 30 September. Should the Minister comply with the request of the National Action, it will give the owners of immovable property an extra year in which to obtain valuations.

We motivate the request as follows: Practice indicates that the initial two years were not enough, and a very low percentage of properties have been valuated to date. There are too few qualified valuators to meet the demand in time. This causes people to valuate their properties themselves, which valuations may be disputed by Sars individually. In this way the process of collection can be delayed and can lead to a loss in VAT.

The principle of fairness is prejudiced if owners were not able to comply with the Act owing to physical circumstances and then necessarily receive unequal treatment. This will also create the opportunity for further awareness campaigns by SARS, and the extension of the cut-off date for drivers’ licences serves as a good analogy. This restored order. We would like to know what the Minister’s answer is regarding this matter.]

                   RWANDAN PRESIDENTIAL ELECTIONS

                        (Member's Statement)

Miss M N MAGAZI (ANC): Madam Speaker, on 25 August 2003 Rwanda held presidential elections where President Paul Kagame was elected and won with a 95% vote in his favour. The elections were conducted peacefully and in a transparent manner, with many observer missions present. To name a few: the AU, the EU and the South African Parliament and Government were there. As South Africans we witnessed the mobilisation, voter education and the political will with which these elections were managed with the resources from the Rwandans, not from the international community. The ANC urges all Rwandese people to unite, work and develop their country. We believe that the coming parliamentary elections will be peaceful as well. We applaud the Rwandan Government for the way in which it allocated resources and time on the national television and radio to all parties. The elections were free and fair, and we wish Rwanda great success in maintaining peace in their country and the Great Lakes. I thank you. [Applause.]

                           INTEREST RATES

                        (Member's Statement)

Dr P J RABIE (DA): Mevrou die Speaker, die DA neem kennis dat die Reserwebank ‘n verlaging van een persentasiepunt in rentekoerse aangekondig het. Die nuus dat die VPIX inflasie binne die teiken van 3% en 6% kan val, word verwelkom. Die DA versoek alle kleinhandelaars en sakelui om die besparings deur middel van die verlaging van een persent op die repokoers deur te wentel na die persone wat negatief deur die rentekoersverlaging geraak word, soos pensioentrekkers en individue wat van ‘n maandelikse rente-inkomste afhanklik is, en wat nou minder geld sal hê om te bestee. Die rentekoersverlaging behoort besigheids- en verbruikersvertroue te verstewig. Dit is ook gebiedend noodsaaklik dat die Regering daadwerklik die volgende drie bedreigings onmiddellik aanspreek: MIV/Vigs, die ongekende hoë werkloosheidsyfer en die vloedgolf van misdaad. Finansiële markte verkies stabiliteit en roetine. Die rentekoersverlaging word verwelkom en die Reserwebank word versoek om ‘n aanduiding te gee of die verbruikers enige verdere rentekoersverlaging voor die einde van hierdie jaar te wagte kan wees. (Translation of Afrikaans member’s statement follows.)

[Dr P J RABIE (DA): Madam Speaker, the DA notes that the Reserve Bank announced a reduction in the interest rate of one percentage point. The news that the CPIX inflation could fall within the target of 3% and 6% is welcomed. The DA requests that all retailers and business people channel the savings generated by the one percent cut in the repo rate to those people who will be negatively affected by the interest rate cut, such as pensioners and individuals who are dependent on a monthly interest-linked income and who will now have less money to spend. The interest rate cut should strengthen the confidence of businesses and consumers. It is also imperative that Government immediately and actively address the following three threats: HIV/Aids, the unparalleled high unemployment levels and the tidal wave of crime. Financial markets prefer stability and routine. The interest rate cut is welcomed and the Reserve Bank is requested to give an indication whether consumers can expect any further interest rate cuts before the end of this year.]

               DEBATE ON HEALTH AND SCIENTIC RESEARCH

                        (Member's Statement)

Dr R RABINOWITZ (IFP): Madam Speaker, noting the emergence of spring, which reminds us of reproduction, and the current Parks Conference relating to biodiversity, which also relates to the reproduction of the species, and noting the recent passing of the National Health Bill, which controls reproductive research through regulations over which Parliament will have no purview for it will be left to the Minister to licence reproductive research and stem cell research in future, noting also the immense power that is in the hands of researchers to change the world through the use of biotechnology which can splice genes from one species to another, noting genome research whereby we can understand the functioning of genes and all living organisms, and noting cloning whereby species can be reproduced, and noting also the complex moral issues involved in research using fertilised zygotes or embryos, this House calls on the Minister of Health and the chairperson of the health committee to hold a public debate and public hearings into the future regulation of stem cell research for South Africa which has considerable potential to contribute to stem cell research or to be exploited through stem cell research. The discussion on these issues should include scientists, doctors, ethicists, religious bodies and members of the public.

Thank you.

                    IMPLEMENTATION OF AGREEMENTS

                        (Member's Statement) Ms P K MOTHOAGAE (ANC): Madam Speaker, the North West Department of  Housing is improving the lives of the aged at the Lehurutse Township, Ward  12.  The department has replaced corrugated tin houses that were built by the  former Bophuthatswana government with proper houses for the  community.  The  ANC's concerns are that the tin houses have not been dismantled and therefore  are becoming a haven for criminals. These  criminals  use  the  tin  houses  for their criminal activities - killing, raping  and  robbing  elders  of  their money. The criminals are known in the community, but no  arrests  have  been made to date. The community the SAPS, the Department of  Social  Development and the municipality have held a meeting on these issues. The ANC urges  all concerned to urgently implement agreements  reached  at  that  meeting.  The existence of these tin  houses  should  not  be  allowed  to  undermine  the magnificent work done by the ANC Government in delivering the houses to  our people. ``There shall be houses for all''. I thank you.

                     RELIGIOUS POLICY IN SCHOOLS

                        (Member's Statement)

Mev M E OLCKERS (Nuwe NP): Mevrou die Speaker, die godsdiensbeleid van skole wat eergister deur prof Asmal bekendgestel is, is nie volmaak nie, maar die Nuwe NP verwelkom die meer gematigde standpunt wat die Minister uiteindelik ingeneem het. Die aanvanklike konsepbeleid sou ‘n einde aan alle godsdiensbeoefening tydens skoolure beteken het.

Die beleid wyk ook nie veel af van wat in elk geval tot op hede in skole toegepas is nie. Skoolbeheerliggame word steeds toegelaat om die aard en inhoud van godsdiensbeoefening te bepaal, mits dit binne die raamwerk van die Grondwet en die Suid-Afrikaanse Skolewet geskied. Verder mag godsdiensbeoefening deel van saalbyeenkomste wees, maar leerders mag toegelaat word om op grond van gewetensbesware van godsdiensbeoefening tydens saalbyeenkomste verskoon te word, mits billike reëlings getref word vir die beoefening van ander godsdienste.

Die Nuwe NP het egter nog steeds ‘n probleem met die huidige beleid wat voorstel dat ‘n vergelykende studie tussen godsdienste van graad 1 af aangebied moet word. ‘n Vergelykende studie behoort eers aangebied te word wanneer die leerder se eie godsdiensoortuigings gevestig is.

Ons spreek dus die hoop uit dat die Minister hierdie deel van die beleid sal hersien, aangesien dit kinders sal verwar as hulle te jonk met ander godsdienste as hulle eie in aanraking kom. Verder moet die Minister ook toesien dat die vergelykende studie deur goed onderlegde onderwysers aangebied word. Baie dankie. [Tussenwerpsels.] (Translation of Afrikaans member’s statement follows.)

[Mrs M E OLCKERS (New NP): Madam Speaker, the religious policy of schools, introduced the day before yesterday by Prof Asmal, is not perfect, but the New NP welcomes the more moderate stance finally taken by the Minister. The initial draft policy would have meant an end to all religious practice during school hours.

The policy does not deviate much from that which has until now been applied in schools. School governing bodies are still allowed to determine the nature and content of religious practice, if it falls within the framework of the Constitution and the South African Schools Act. Furthermore, religious practice may form part of hall assembly, but learners may be allowed to be excused from religious practice during assembly on the grounds of conscientious objection, provided that reasonable arrangements have been made for the practice of other religions.

However, the New NP still has a problem with the current policy, which proposes that a comparative study of religions be presented from Grade 1. A comparative study should only be presented once the learner’s own religious convictions have been established.

We therefore express the hope that the Minister will review this part of the policy because it will confuse children if they come into contact with religions other that their own at too young an age. Furthermore, the Minister must also see to it that the comparative study be presented by well-equipped teachers. Thank you. [Interjections.]]

                    TAXATION POLICY - ENFORCEMENT

                        (Minister's Response)

The MINISTER OF FINANCE: Madam Speaker, there are two different issues that I would like to respond to. The first is that of the hon dominee Aucamp in respect of CGT, and the second relates to comments by Dr Rabie on the Reserve Bank and interest rates. In respect to CGT, the position that the hon Aucamp takes is that these people who have had two years - 24 months - to fill out applications to have their properties valued and have not done so, have not done so because there aren’t enough valuers.

I would like to put forth an alternative interpretation. They have not done so because they are lax about their tax matters. The key issue is: What would enable us to enforce it? I feel no sympathy for people who are lax about their tax matters. Render unto Caesar ... '' as the dominee used to preach. Now he says no, let Caesar wait because ons is ‘n bietjie slapgat’’ [``we are a bit lax’’.] It’s wrong! It’s wrong and I think it is important that all members of this House should say it’s wrong. We should agree that it is wrong and then we should look at what would improve the enforcement.

Clearly it is a matter under consideration. However, let us not hide the facts. The facts are that people are lax about their tax matters. Thank you.

                  INDEPENDENCE OF THE RESERVE BANK

                        (Minister's Response)

The MINISTER OF FINANCE: Madam Speaker, the second issue is the following. I think all kinds of issues, in the Bredasdorp style, were smuggled into this statement by the hon Rabie, from HIV/Aids to crime. The key issue, and I think this is presumably what he was asking was for the Reserve Bank to show its hand, but it is silly in the extreme.

Monetary policy has to be managed by the Monetary Policy Committee. They will take a view on the economy and take appropriate decisions in time and circumstance. If you don’t do that, then everybody would game with the central bank and we wouldn’t have monetary policy. You would have profit- taking and the impoverishment of the bulk of our people in this country. We would have our people in hock for eternity.

I think it is very important that we support the independence of the Reserve Bank as per the Constitution, and the right of the Monetary Policy Committee to take such decisions without fear or favour and without having to give notice of what the decision would be. I support the Reserve Bank and its independence. I thank you.

                  CONDEMNATION OF TERRORIST ATTACKS

                        (Minister's Response) THE MINISTER OF SAFETY AND SECURITY: Madam Speaker, the  SA  Government  was amongst the very first Governments of the world that  conveyed  support  and sympathy to the American nation in the  wake  of  the  11th  of  September's terrorist attacks.  We  continue  to  indicate  our  solidarity  with  those people, particularly those who continue to live with  the  trauma  of  those events. Of course,  it  is  not  the  first  time  that  we  have  condemned terrorist attacks against people.

Exactly 30 years ago, to the day, on 11 September 1973, the ANC and its allies condemned the terrorist assassination of Allende, the first socialist and democratically elected president of Chile. That particular incident was, of course, abetted and assisted by some of the modern democracies of the world. Yet even at that point, we understood it for what it was - a terrorist attack on the people of Chile themselves, who afterwards fell under the jackboot of Pinochet and for many years suffered horrendous human rights violations.

                         CAPITAL PUNISHMENT

                        (Minister's Response)

The MINISTER OF SAFETY AND SECURITY: The other matter I want to refer to is the issue of the death penalty. We are happy as the SA Government and as the ANC that South Africans, by and large, are people who are not vengeful. Because we are that kind of people, after 1994, when democracy came, we never saw scenes of people who were chasing one another to wreak vengeance against them because of the practices of the past. Because we moved from that position, we do not believe any state must be one that visits vengeance on anyone, including criminals. There ought to be other ways in which we can deal with those who are criminals, without invoking capital punishment.

I have shared platforms with some people across there, who themselves are now talking about the return of capital punishment. They are doing this because they believe that this is an issue that is emotional to a point where they can derive support, using emotion as a vehicle for mobilisation. That is not what moves us from where we stand. What moves us are policies that are steeped in morality, and policies that have a regard for the fact that we can never violate human life. Thank you. [Applause.]

                        RELIGIOUS INSTRUCTION

                        (Minister's Response)

The MINISTER OF EDUCATION: Madam Speaker, I am not in a combative mood today, so I am going to reply in a very sober, deliberate way to the hon Olckers, because of the general approval of the Government’s policy on religion in education. I am grateful for the support, because we must move away from the rather silly debates that have been taking place in the past six months. I am grateful to all the political parties who have responded in a positive way.

This policy does deviate from the past; let’s be quite clear. The fundamental assumption of this policy is that we’re a multireligious country. We must take that into account. No child should feel isolated, left out or prejudiced by any practice that takes place in school. So we recognise the extraordinary unity between the state, which is not a secular state like France or the United States, and also our preamble to the Constitution that invokes the deity and our wonderful anthem that begins with a reference to the deity.

One must take into account that not only are we a multireligious society, we are a multicultural society also. That is why the discussions that took place with all the churches were extraordinarily meaningful, because in the end we got an agreement that, first of all, we learn about the religions of the world, as reflected in South Africa, in the curriculum itself on religion education.

Secondly, religious instruction is a function of the school and the family, and generally those associated with confessional education. That will take place in school after school hours without discrimination. So, the largest church in South Africa, the Zion Church, which has been discriminated against for years and years, will find a proper place in the school after school hours.

Finally, on religious observances, there are constitutional provisions about religious observances in school. We say that there are different kinds, but assembly is only one kind, and therefore we respond to the need by saying that different religions should be able to observe their holy days. If schools organise other activities, then we must take into account that we have a multireligious society. Can I say that I am prepared to speak to all the parties.

The SPEAKER: Thank you, Minister.

The MINISTER OF EDUCATION: I understand there was a joint caucus meeting with two parties there. I’ll speak to the New NP.

The SPEAKER: Thank you, Minister. Hon members, that ends the time for ministerial responses. Order! Order, hon members. I have been requested to provide an opportunity for a further motion without notice. In view of the special circumstances, I will now give that opportunity to the hon Chief Whip of the ANC.

                  DEATH OF SWEDISH FOREIGN MINISTER

                         (Draft Resolution)

The CHIEF WHIP OF THE MAJORITY PARTY: Madam Speaker, thank you very much for that. I move without notice:

That the House -

(1) notes with profound shock and sadness the passing away this morning of Anna Lindh, the Foreign Minister of Sweden, as a result of a fatal stabbing attack;

(2) recognises the role played by Minister Lindh in fostering solidarity and co-operation between Sweden and South Africa; and (3) expresses its condolences to the people of Sweden and the family and loved ones of Minister Lindh.

The SPEAKER: I take it there are no objections. The motion is carried, and we will convey the sentiments expressed to the government and the people of Sweden.

Agreed to.

         LOCAL GOVERNMENT: MUNICIPAL FINANCE MANAGEMENT BILL

                       (Second Reading debate)

The MINISTER OF FINANCE: Madam Speaker, hon members, the Ministry of Finance is not given to hyperbole or sensation. As in the debate of the Local Government: Municipal Finance Management Bill in the NA, today is indeed an occasion to bring to fruition what has been a record or damn near a record in this Parliament. It has taken the greater part of three years to draft, redraft and refine it and, in fact, I have lost count of the numerous versions to the Bill as circulated.

If my calculations are correct, there were 41 committee hearings and sittings on this Bill in Parliament, in addition to smaller working groups that also met. After all of that, I am given 10 minutes to introduce it. There should be no suggestion that this legislation is not the most extensively consulted upon piece of legislation before this House ever.

The Bill covers for the local sphere of Government the same issues that the Public Finance Management Act covers for national and provincial spheres. Indeed, this Bill was originally planned to be part of the Public Finance Management Act when it was first prepared for tabling, as a Treasury Control Bill in 1998. However, at the time the specific characteristics of local government were so different from national and provincial spheres that it warranted a separate Bill, hence it was removed from the Treasury Control Bill shortly before its gazetting on 14 August 1998 and tabling. The Public Finance Management Act was enacted as Act 1 of 1999, within 6 months of its gazetting.

The Bill also involves two significant rounds of amendments to the Constitution. The first, passed in 2001, amended section 230 of the Constitution, which deals with municipal borrowing. The second amendment was effected early this year to section 139 of the Constitution on provincial intervention in municipalities, by allowing for a process of mandatory intervention in the event of a serious financial crisis in a municipality where the ability to provide basic services is impaired.

Both these amendments were necessary, not only to resolve municipal financial crises, but also to protect municipalities and to reduce the risk premium for municipalities when they borrow funds. These amendments protect municipalities whilst they are resolving their problems, to enable them to continue providing services. They also provide certainty to lenders and investors about action that can be taken against a municipality that does not meet its financial obligations. In this respect, provincial government will have to rise to the challenge of assisting or intervening earlier when municipalities experience financial problems, rather than ignoring it.

Compliance by provincial governments to monitor municipal finances and to act when problems are first identified, is critical for good governance in South Africa, and to assure our people that basic services are being provided. Perhaps more importantly, it is to ensure that local government is empowered to deliver on its constitutional developmental mandate. The current system of budgeting and financial management at the municipal level is antiquated and based on one-year line item budgeting. Unlike the national and provincial spheres, budgetary reforms, such as the Medium-Term Expenditure Framework, budgeting by programmes and votes, rather than inputs, focusing on outputs and performance and so on, have not been implemented at local level, save for a few pilot municipalities.

The Bill before this House will introduce these budgetary reforms to municipalities over the next few years. As for the Public Finance Management Act, the approach to financial management gives effect to the principle of ensuring effective accountability for the policy and implementation processes. The mayor will be responsible for policy and outcomes, and the municipal manager responsible for outputs and implementation. Whilst the municipal manager is accountable to the mayor or executive, both are also accountable to the municipal council, which must approve the policy proposals and budget, and play an oversight role in the implementation and the outputs.

This Bill spells out clearly the roles of councillors, mayors, municipal managers and other officials in their engagement with the municipal budget and its implementation, procurement or supply chain management and municipal entities. It spells out the policy-guiding role that the mayor plays in the budget process, with the IDP and other policy areas, and in setting performance targets for the municipal manager. It makes the municipal manager the accounting officer responsible for implementation of policies approved by the council in accordance with the performance contract agreed to with the mayor.

It also introduces quite firmly, the idea of the annual report. The Bill imposes tough sanctions against a municipal manager or municipality that fails to submit its financial statements within two years after the end of the financial year. This measure is in line with the Public Finance Management Act and deals with the legacy of lethargy in submitting financial statements promptly after the end of the financial year. Just as this is no longer tolerated for national and provincial departments, it will not be tolerated for municipalities. Similarly, also the fact that some municipalities choose not to pay the Auditor-General, cannot be tolerated in this environment.

The annual report will include reports on performance to be audited in terms of the systems Act. Amendments to this Act are coming up hereafter. Annual reports will also include details of all intergovernmental grants, ensuring that these are all budgeted for by the municipality and spent in accordance with the approved budget. The Bill also obliges municipalities to disclose the salaries and remuneration of the mayor, the municipal manager, the councillors and the senior officials. I thought that would mean applause. [Applause.] Thank you belatedly. Thank you very much. The annual report is an important tool for empowering both councillors and the local community to hold the municipal officials and the mayor accountable for their performance in the delivery of services.

The Bill ends the practice of undisclosed or unaudited banking accounts or investments by municipalities. It requires each municipality to open bank accounts into which all money received must be paid. The municipal manager is made responsible for how these accounts are managed. Municipal investments will be completely transparent, and must be in accordance with the investment framework prescribed by the National Treasury. The Bill also provides strong measures for dealing with financial misconduct or grossly negligent behaviour. Most importantly, the Bill is forward looking. It requires a new approach to implement the radical changes that must replace the old practices. New skills are required to implement the Bill successfully, and a new cadre of municipal and financial managers and practitioners will be required in municipalities. In implementing the Local Government: Municipal Finance Management Act, it is more important to implement the spirit of this Act than to do so merely for the sake of nominal compliance.

The challenges facing us in implementing this Bill are enormous, given that there are 284 municipalities. We have already started implementing the Local Government: Municipal Finance Management Act reforms by commencing with a few pilots over the past three years. The pilots now encompass 39 municipalities across the country that are rolling out sections of the reforms with the assistance of the National Treasury and the international technical assistance programme. Visible signs of progress have been noted in 24 municipalities which have already tabled multiyear 2003 budgets.

In conclusion, this Bill is one of the foundation Acts of Parliament required by the Constitution and the 1998 White Paper on Local Government. It gives effect to chapters 3 and 13 of the Constitution, and section 139, as amended. In conclusion, I want to thank a number of persons who contributed to the Local Government: Municipal Finance Management Bill. Firstly I want to thank the members of the two Portfolio Committees on Finance and Local Government, for working so closely to ensure that the Local Government: Municipal Finance Management Bill and Local Government: Municipal Systems Act are consistent and linked to each other in a way that will help local government officials and councillors. I want to thank Ms Barbara Hogan and Mr Yunus Carrim, if he is in the House, for their guidance during the processing of the two Bills. [Applause.]

I also want to thank my colleague Minister Sydney Mufamadi and his officials for working so closely with National Treasury to ensure that the two Bills are consistent, and for their assistance during the very hard process to amend the Constitution, particularly section 139. This co- operation will be even more important in the coming years as we implement both the Systems Act and this one. I also want to thank Mr Johnny de Lange, the Portfolio Committee on Justice and officials for all their assistance in processing the two constitutional Acts required for this Bill.

Salga has been important for its participation in the process, particularly the valuable inputs from the mayors of Tshwane, Ekurhuleni and Matjhabeng and all the individual inputs. I would like to end by thanking the officials of the National Treasury for all their hard work in persistence of this Bill and to ensure that the two Constitutional amendments in this Bill have finally been completed. Now they face an even harder task of implementing the Bill successfully. Thank you very much for listening to me. [Applause.]

Dr P J RABIE: Mevrou die Adjunkspeaker, agb Minister en agb lede, hierdie wetsontwerp is van kritieke belang vir Suid-Afrika as daar na die kommerwekkende skuldposisie van ‘n aantal plaaslike owerhede oor die hele Suid-Afrika gekyk word. Die vraag is, het dit nie nodig geword dat ons proaktief optree en die kapasiteit op grondvlak by derdevlak-owerhede skep nie? Suid-Afrika is onlosmaaklik gekoppel aan ‘n proses van verstedeliking. Die Grondwet bepaal dat elke Suid-Afrikaner toegang tot voldoende skoon drinkwater en ander maatskaplike basiese dienste moet hê.

Ekonomiese groei en werkskepping is gekoppel aan ordelike plaaslike bestuur. Rekenkundige praktyke in sommige plaaslike owerhede het in die verlede nie aan aanvaarbare rekenkundige standaarde voldoen nie. Die DA steun die wetsontwerp, maar doen ‘n ernstige beroep op die Tesourie, die Departement van Provinsiale en Plaaslike Regering, die onderskeie provinsiale departemente en plaaslike owerhede om toe te sien dat dié wetsontwerp behoorlik geïmplementeer word. Dit is maklik om wette daar te stel. Om egter die kapasiteit te skep en werklik die lewensgehalte van die persone op grondvlak te verbeter, is ‘n heel komplekse aangeleentheid. (Translation of Afrikaans paragraphs follows.)

[Dr P J RABIE: Madam Deputy Speaker, hon Minister and hon Members, this Bill is of critical importance for South Africa if we have to look at the alarming debt position of a number of local authorities over the whole of South Africa. The question is, has it not become necessary to act proactively and establish capacity at grass-roots level among third-tier authorities? South Africa is inextricably linked to a process of urbanisation. The Constitution stipulates that every South African must have access to clean drinking water and other basic social services.

Economic growth and job creation are linked to orderly local government. In the past accounting practices in some local authorities did not comply with acceptable accounting standards. The DA supports the Bill, but would like to make an urgent appeal to the Treasury, the Department of Provincial and Local Government, the various provincial departments and local governments to see to it that this Bill is properly implemented. It is easy to put laws in place. However, to establish capacity and to really improve the quality of life of the people at grass-roots level is a complex issue.]

The Local Government: Municipal Finance Management Bill relates to financial management in the local sphere of government. It gives effect to sections 215, 216, 217, 218 and 229 of the Constitution, which deal with the transparency of budgets, budget formats, Treasury norms and standards, procurement guarantees and municipal fiscal powers, which include taxation and borrowing. The Bill was debated and amended for more than 18 months - the final draft was only completed in the first week of September.

Another significant aspect of this piece of legislation is that it deals with section 139 of the Constitution, as amended in 2003 by Act 2003 which deals with provincial and national intervention over local government if a municipality fails to pass a budget strictly in terms of section 139(1) of the Constitution or fails to provide basic services, fails to meet basic commitments, etc. Discretionary provincial and national interventions, however, must follow set procedures in terms of section 139 of the Constitution.

The MFM Bill can be compared with the Public Finance Management Act, the PFMA, which covers the national and provincial spheres of government. Because of the complexities of local government, it was decided to create a Bill which would provide uniform Treasury norms and standards for all spheres of government. This Bill gives effect to section 216 of the Constitution which stipulates that national legislation must establish a National Treasury and prescribe measures to ensure both transparency and expenditure control in each sphere of government, and subparagraph (c) of this section stipulates uniform Treasury norms and standards, which is a very important aspect of this particular Bill. This Bill provides extensively for the effective accountability for the policy and implementation process. The distinction that the mayor is responsible for policy and outcomes, and the municipal manager is responsible for outputs and implementation is also very important.

The Bill is extremely detailed and covers 16 chapters. The first chapter defines key terms and determines the conditions under which amendments to legislation may be made. Chapter 2 deals with the powers of National Treasury regarding local government, finance and fiscal powers.

Chapter 3 is one of the core chapters of the Bill because it sets out a framework for municipal banking accounts into which all money received by municipalities must be paid. It also requires each municipality to designate one primary banking account into which all intergovernmental grants must be deposited. The municipal manager is made accountable for these accounts and must ensure compliance with various oversight and administrative requirements. A framework for municipal cash management and management of investment by municipalities is also stipulated. During a submission to the Finance committee it was mentioned that a certain municipality invested millions of rands into holiday flats at a beachfront in a well-known South African city.

During a number of meetings of the Portfolio Committee on Finance in the past 18 months, a number of case studies were presented; Koppies in the North West province and Butterworth in the Eastern Cape were cited as examples where draconian intervention measures had to be taken by provinces in terms of section 139 of the Constitution which provides for provincial supervision of local government.

Chapter 4 deals with the integrated development plans, municipal tax tariffs and credit control policies. Councils are also made responsible for approving budgets within the specific legal framework stipulated. Chapter 5 provides for organs of state providing bulk resources, such as electricity and water to municipalities, to consult municipalities when municipalities intend to sign long-term contracts.

Chapter 6 deals with the borrowing of money. Chapter 7 defines the responsibilities of councillors, the mayor, executive mayor or council. It prohibits the councillor for financial matters from interfering in financial management responsibilities assigned to the municipal manager or chief financial officer.

As a former councillor, the definition of the responsible overseeing of expenditures and revenue collection, preventing overspending of a budget rate, is very significant to me, and will act as a guideline to future councillors.

Chapter 8 defines the responsibilities of officials. Written employment contracts and performance standards are required, and efficient and transparent systems of financial and risk management are clearly spelt out.

A treasury and budget office must also be established by every local authority. Municipal entities were discussed at length by parliamentary committees. The accounting requirements, auditing asset transfers, debt management, financial reporting and the accounting authority accountable for the execution functions were also discussed in depth.

Chapter 12 defines the requirements and procedures regarding the preparation of auditing and processing of financial statements of municipalities and municipal entities. It is noteworthy that the financial statements of a municipality must be submitted to the Auditor-General within a specific time period.

Indien daar enige sprake is van ‘n ingrypende aksie deur provinsiale of nasionale rolspelers, moet streng neergelegde prosedures, soos deur die Grondwet voorgeskryf, gevolg word. (Translation of Afrikaans paragraph follows.)

[If there is talk of drastic action by provincial and national roleplayers, strict, stipulated procedures, as prescribed by the Constitution, must be followed.]

The Bill provides for the establishment of a municipal financial emergency authority with the main function of overseeing the administration of municipalities in financial emergency. The procedure to be followed regarding the termination of a financial emergency and the extraordinary measures to be taken if the emergency recovery plan proves to be insufficient are provided.

Chapter 15 deals with financial misconduct within municipalities. A legal regime is provided for disciplinary proceedings and for criminal proceedings against municipal managers, accounting authorities and officials.

Hierdie wetgewing is so kompleks van aard dat dit nie oornag in alle munisipaliteite geïmplementeer kan word nie. Hoofstuk 16 van die wetsontwerp maak voorsiening vir ‘n infaseringstydperk waarvolgens die wetgewing ingefaseer word betreffende die belanghebbende plaaslike owerheid.

Die wetsontwerp is ‘n vertrekpunt wat poog om munisipale finansies te orden. Twee regsmenings van senior regslui maak die stelling dat die wetsontwerp nie strydig met die Grondwet is nie. Die kernbedoeling van die wetsontwerp is om aanvaarbare rekenkundige standaarde en norme vir plaaslike owerhede daar te stel.

Die magte van die Nasionale Tesourie en provinsiale owerhede om ‘n finansiële noodtoestand binne ‘n gegewe munisipaliteit te beredder geld slegs as alle wettig voorgeskrewe regstellende stappe gevolg is om die raad van ‘n munisipaliteit te oortuig om hulle begroting te aanvaar en dienste aan hulle gegewe teikengemeenskappe te lewer. Ek dank u. [Applous.] (Translation of Afrikaans paragraphs follows.)

[This legislation is of such a complex nature that it cannot be implemented in all municipalities overnight. Chapter 16 of the Bill makes provision for a phasing-in period whereby the legislation is phased in according to the local authority concerned.

The Bill is a point of departure which tries to organise municipal finances. Two legal opinions from senior legal people, made the statement that the Bill is not in conflict with the Constitution. The main objective of the Bill is to put in place acceptable accounting norms and standards for local authorities.

The powers of the National Treasury and provincial authorities to administer a financial state of emergency within a given municipality, only apply if all legally prescribed corrective steps were followed to convince the council of a municipality to accept their budget and to render services to their target communities. I thank you. [Applause.]]

Ms B A HOGAN: Madam Deputy Speaker, the Local Government: Municipal Finance Management Bill is, as the Minister said, the foundation Bill for financial management at local government level. It is a long and complex Bill. As has been said, we spent a lot of time debating virtually every clause of this Bill. The Bill before this House today is a redraft of the original Bill that came before us and arose out of those discussions.

Let me say that it was a remarkable experience to be able to draw on the expertise, experience and energy of another committee here in Parliament, the Portfolio Committee on Provincial and Local Government. Had it not been for their participation in our work, we would have been at a severe disadvantage. They could bring the wealth of their experience and insight into local government and teach us in ways that we would not have been able to do on our own. I want to thank them for their participation.

Equally, I would like to thank the department, the Ministry for Provincial and Local Government, and the Treasury for the time and energy that they devoted to participate in the debate on these Bills. It was a remarkable experience to have two Government departments working well, sometimes robustly - and there were robust debates. Nevertheless, I think that the final result was the great value that was added to this Bill.

Finally, let me commend Salga - the SA Local Government Association. There was not one meeting at which Salga was not present. They could bring their considerable experience in local government finance in order to benefit the committee. Let me thank them, too, for their very very valuable participation. At the end of the day, I hope that we shall have a Bill in which there is buy-in from all the stakeholders.

This Bill, in effect, addresses some very important stakeholders, and I want to put them into three categories. In the first category there are ordinary residents of a city who want good financial management and value for their money, and who want to see service delivery arising out of good and efficient use of resources. The Minister and Dr Rabie have spent some time going through the provisions of what that would entail, and I am not going to dwell on that. However, bear in mind that there are very important clauses that relate to the responsibilities of councillors, mayors and municipal officials in regard to the local citizenry.

Furthermore, we were able to draw on a precedent set by the Local Government: Municipal Systems Act which has a very strong and laudable emphasis on participatory democracy, accountability and transparency. Other important players are provincial and national governments, and provincial and national organs of state. For too long, it has seemed that local government had to be on the receiving end of whatever came from provincial and national governments. So, for instance, as you would see later in the debate on the Local Government: Municipal Systems Amendment Bill, attention has been given to a situation when another sphere of government assigns additional functions to the municipality. There can no longer be a situation where functions are simply assigned. There are conditionalities attached.

National governments and provincial governments, too, now have to play a much more active monitoring role. They are bound by the legislation to commit themselves to building the capacity of municipal governments. However, most importantly, I think that what was very definitive in this Bill was the interventionist role of, particularly, provincial governments when, in the unlikely event - and I must stress ``unlikely event’’ - a municipality reaches a stage where its financial situation is in severe crisis. We spent many weeks together with the justice committee bringing the amendment to the Constitution in order to unravel just exactly what the responsibilities of provincial government are.

For too long, local government has been a stepchild. Let me say at the outset, after having gone through one and a half years of looking at what the responsibilities for financial management are at local government level, that that sphere of government experiences more complex and difficult financial arrangements than any other sphere of government. And, too often, that sphere of government has been left to its own resources to try and manage a very, very complex situation.

In order to cater for a situation in which a problem starts to manifest itself in a serious way in a municipality, we have now built in mandatory interventions and assistance from, particularly, the provincial governments. No longer would residents of municipalities be faced with a situation where a municipality, for instance, can’t pass its budget or where there are such severe financial crises that delivery is impeded.

We have built into this process a mechanism which makes it mandatory upon the MEC to intervene through an agency called the Municipal Financial Recovery Service which will be housed in the National Treasury. That service will intervene, analyse the problems, and put forward a financial recovery plan which would be approved by the MEC and amended if necessary. The municipality would then approve it; and if not, the municipality gets dissolved. If there is no meeting of minds on the issue, a new municipality would then be elected to implement a financial recovery plan.

I think that this is going to be path-breaking in terms of interventions when municipalities hit crises. It’s not only the residents that are affected by severe crises in a municipality, it is also the private sector. And, this is the third stakeholder that we are looking at in terms of the Local Government: Municipal Finance Management Act. The private sector would like to invest and would like to lend. However, up to now, there have been particular problems and insecurities in lending that have made it difficult for municipalities to bring in investment because - and bear in mind that - most municipalities do not have sufficient revenue to effect capital investments which are required. Therefore, they do need to be able to borrow and to bring in alternative investments.

This Bill, in various ways, gives certainty to prospective investors and lenders that their interests are secured, and that they will be able to lend with many more guarantees and much more security than they have had in the past. Part of that is the mandatory interventions by other spheres of government once a municipality is unable to meet its financial commitments. Those mandatory interventions allow a municipality to recover quickly and more rapidly than it would have if it was left to its own devices. They spell out that national and provincial governments must, as the Constitution envisages, provide assistance to the local sphere of government when required. So, the financial recovery agency and all the provisions there are going to be essential for the success of this Bill.

Finally, I just want to go through a couple of other small points. Regarding bulk service delivery, too often, municipalities have no say when a bulk service provider wants to increase the prices of electricity or water and they are just left on the receiving end of this. We have now instituted a process that has to be engaged in by any national or provincial government department and any organ of state that provides bulk service delivery. Hopefully, municipalities would then be able to have greater intervention and be able to make their views felt, as well as the National Treasury, Ministry for Provincial and Local Government, and other stakeholders.

Capacity-building has also been raised as a severe problem. Salga raised the issue very forcefully with us by saying that although provinces monitor what happens, no one shares those results. It’s now mandatory that provinces must share the results of their monitoring and, in that way, build up the capacity for municipalities to deliver on their mandate.

I could go on. This Bill will, no doubt, I think, be the subject of many discussions. Municipal managers and chief financial officers, in particular, would be looking at this Bill with great interest. But, let me say that it is a giant leap ahead in realising what the Constitution envisaged for us. I wish every role-player who will be implementing this Bill the very best in doing that. I also look forward to seeing exemplary financial management in a couple of years’ time which will be far better than what happens at national and provincial levels. Thank you very much. [Applause.]

Dr G G WOODS: Thank you, Madam Deputy Speaker. In considering the volume of hours and brain power that went into this Bill, it would be almost ungracious to suggest that it was anything less than perfect. However, notwithstanding its wealth of instruction, it does, indeed, take us forward, as hon Hogan said. I’m going to leave that to other speakers to acknowledge.

I wish to express some reservation, in particular regarding the regressive management philosophy to which the Bill subscribes, and I will include both general management and financial management.

I think that the general management observation falls under expanding international public sector revolution which, over the past 15 years, has introduced wide-ranging adaptations of modern and successful organisation and management approaches into Government. Essentially, these are the approaches and methods that have brought the management performance of leading private sector co-operations to be what it is today. It is a revolution which some of us thought we had joined when introducing modern practices into the PFMA at the time of its writing, but which, three years down the road, seem to be slowed by a public sector inertia from certain quarters.

Now we have the municipal equivalent before us which confirms this reluctance somewhat, or is it a lack of confidence, to join the modern management school? The management approach being adopted in the world’s progressive countries begins with the flattening of organisational structures in the devolution of responsibility to a wider base of officials, and giving them sufficient decision-making authority and unabated discretion to achieve predetermined levels of performance.

It capitalises on the human initiative factor and, as such, avoids extensive controls and regulations which could leave officials robotic and disinterested, and only doing what is necessary to keep them out of trouble.

It became clear to me during the processing of this Bill that its paternalistic character emerged from a belief that municipal officials are generally incompetent, dishonest, lazy and devious, leading to a Bill designed to control and macro-manage these devious officials, rather than the opposing new-era approach, which is to stimulate human potential towards the attainment of results.

I now come to financial management observation. In my opinion, a Bill which purports, by way of its title, to be about financial management should be about financial management. Considerably less than half of this Bill is about financial management, as it is properly defined. It covers so much else that it would be more appropriate in a handbook of administrative processes. Financial management particularly in the public sector is about how best to achieve value-for-money spending, while discouraging risk through sound internal control and accountability arrangements. The value for money issue is almost nonexistent in the Bill, with three vague, single-sentence references at most, versus, for example, 50 references and prepositions detailing financial recovery plans. Good financial management assistance, together with the properly distributed responsibilities referred to earlier, as Mervin King often points out, are central for strong corporate governance.

What are these main systems? Are they budgetary systems incorporating an accounting system and management of an information system? The Bill does go into some detail about how to process the Budget, but largely ignores the attributes necessary to make the Budget the premier management tool that it ought to be.

The accounting system has been given even less attention, as is the case with the management information system. There are reasonable provisions concerning year-end reporting, but annual reporting appears inadequate for sound management and accountability. As with the PFMA, the Bill admits to insisting on costing systems without which, and as all progressive countries would point out, terms like measurable objectives'', performance indicators’’, etc, are just filled with jargon.

While acknowledging that much of the Bill consists of sound instruction, I think it could have learned a lot more from certain PFMA weaknesses which have emerged, and have taken a more modern framework approach, set around performance-based management systems, responsibility and functions, risk management and clearly established accountability arrangements, in a more coherent and organised way. That would have left us to define more clearly what belongs in law and what belongs in regulation.

I have two remaining issues to address. Firstly, there is the capacity issue, which has been touched upon. I think against the complex, burdensome and sometimes ambiguous demands, there must be some concern about the ability of officials to meet the challenges of the Bill. Senior Salga representatives have shared this concern, and I can only repeat my previous request to the Minister, that he consider the establishment of a public sector financial management college which provides affordable and quality training to officials of all three levels of government.

Finally, there is the issue concerning entities. This is an awkward situation of municipal entities and the Bill is a contortionist, which tried to accommodate these various entities and their responsibilities. I agree that you have done well under the circumstances, but here I want to ask the Minister if he would, under advice, consider legislation which gives birth to a new type of legal entity; one which is especially designed to accommodate all entities in which the state, at any level of government, has a significant interest.

Further, there is a need to convert all existing entities to this type of special public entity and to impose this upon all new entities that are formed that fall under this legislation. Thank you.

Mrs R R JOEMAT: Thank you, Madam Deputy Speaker. I am surprised Dr Woods shares his concerns. I just wish he could have shared them with us in the portfolio committee.

The Local Government: Municipal Finance Management Bill is a Bill that seeks to achieve and secure sound and sustainable financial management within municipalities and other institutions in the local sphere of government. Municipalities are responsible for providing basic household and suburban services, such as electricity, water, sanitation and refuse removal, among other functions provided for in the Constitution.

These services were traditionally fully provided to formerly advantaged communities under the apartheid regime, but were largely not provided to former black townships. Therefore, important as financial accountability is, it is just as important to address the unfair distribution of resources. Accountability is the pillar that holds good governance together. If you are given a responsibility to deliver a service, you also take on the responsibility to be accountable to those who entrust you with that responsibility. The caretakers who are entrusted must ensure transparency, accountability and appropriate lines of responsibility in the fiscal and financial affairs of municipalities and their entities. They must manage the budget, revenue, expenditure, assets, liabilities and borrowing, and all other financial matters.

This Bill will pose particular challenges to mayors, chief executive officers and senior financial managers. They will act as accounting officers of municipalities, and will be responsible and accountable on all financial matters.

Chapter 7 of the Bill outlines the responsibility of mayors. The mayor of a municipality must provide general political guidance over the fiscal and financial affairs of the municipality. Budget processes and related matters must project the integrated development plan of the municipality and ensure the implementation thereof. He or she must report to the municipal council and the MEC for local government in the province. If there are any delays in the tabling or approval of the budget, the mayor must make public revenue and expenditure projections once the service delivery and budget implementation plan has been approved.

If a municipality does not approve an annual budget or encounters a serious financial problem, it is the duty of the mayor to immediately report the matter to the MEC for local government in the province, who will then act on the matter. The mayor has sole or shared control over a municipal entity, and must exercise his or her power by monitoring the performance of the entity concerned, but may not interfere in the performance of that entity. In other words, the mayor should only be a watchdog over the entity.

Regarding municipalities that do not have mayors, the councils of those municipalities must designate a councillor to exercise the power and duties to ensure good, clean financial management.

In Chapter 8 the responsibility of municipal officials is outlined. The municipal manager is the accounting officer and will take full responsibility for the general financial matters of the municipality. We recognise that municipalities on their own cannot deliver on all the basic needs of our people, and that certain competencies are out-sourced to public-private partnerships or entities. It is for this reason that clear lines of accountability have been outlined in the Bill. Ultimately, however, the municipality will be responsible for service delivery.

We depend on people to execute these functions, and with humans you encounter strengths and weaknesses. Therefore, the human weakness of financial misconduct is addressed in this Bill. If there is misconduct by municipal officials and officials of municipal entities, be it deliberately or negligently, or as a result of gross negligence, it must be investigated and the necessary steps must be taken against such officials. This is outlined in Chapter 15.

We must thank those mayors, management and workers who work tirelessly to ensure that services are delivered in our cities and to our people. However, certain weaknesses have to be addressed, and we hope that passing this Bill will assist municipalities.

The Bill must not be interpreted to mean that National Treasury wants to control or even dictate to local authorities on their financial matters, but should be seen as setting out ways for national and provincial governments to support and strengthen the capacity of the municipality.

The challenge now is to translate these best practice policy reforms, as outlined in the Bill, and put them into practice, which will have a positive impact on the financial accountability of the municipality.

Madam Deputy Speaker, the ANC supports the Bill. [Applause.]

Dr W A ODENDAAL: Madam Deputy Speaker, the Bill before us is a natural offspring of the Public Finance Management Act that secures the sound and sustainable management of the financial affairs of central and provincial government in South Africa.

It strives to secure standards for recognised accounting practices applicable to municipalities or municipal entities. It establishes norms and standards for the management of the revenues, expenditures, assets and liabilities of local governments. It lays down the requirements for borrowing, budgeting and financial planning of the third tier of government.

The main objective of this Bill, to my mind, is to secure accountability, transparency and the appropriate lines of responsibility in the fiscal and financial affairs of local government. Both mayors and municipal managers are now held responsible by law to accept the responsibility for both the decisions they take, as well as the way in which there are funded with taxpayers’ money.

The chief executive officer of a municipality becomes the accounting officer. He or she takes full responsibility for the administration of such a municipality. Political accountability is vested in the mayor. There shall be full transparency in financial management. The funds to municipalities committing serious or persistent breaches of the measures established in terms of section 216 of the Constitution may be stopped. The governance of such municipalities may even, under certain severe conditions, be taken over by a provincial or the central government.

The far-reaching powers bestowed upon first and second spheres of government are questioned by some people. It is argued that the Bill will tempt irresponsible governments and irresponsible political leaders to interfere in governments of lower spheres or even grab political power from such governments much too easily. It is also being argued that it may be unconstitutional for a government of a higher sphere to intervene in the affairs of a lower sphere of government.

The New NP is in favour of punitive measures being put in place to ensure that a government of a higher level may take responsibility to intervene in cases of persistent malpractice by lower spheres of government, but warns against unwanted and improper interference by power-drunk politicians.

Rumours have it that the stipulations of the MFMB will take up to 18 months to implement. The New NP therefore challenges all the responsible local governments to voluntarily, as from tomorrow, adhere to the guidelines for good governance laid down by this Bill until such time that it officially becomes law. It may have been only a relatively small step for Parliament to pass the MFMB, even though it took three years to do so, but the Bill is certainly a giant step towards good governance at local government level.

The New NP therefore supports the Bill.

Mnr A BLAAS: Adjunkspeaker, die negatiewe ervarings in die bestuur van openbare fondse in die algemeen en meer spesifiek in die munisipaliteite, bepaal die behoeftes van hierdie wetgewing. Die oogmerke van die wetsontwerp, klousule 2, is binne grondwetlike bepalings hierop gemik. Die ACDP sal hierdie wetsontwerp steun.

Die wetgewing bepaal dat munisipaliteite aan streng voorskrifte ten opsigte van finansiële bestuur moet voldoen. Sien hoofstukke 4, 7, 8, 9 en 12. Dit verg egter besondere kapasiteit binne elke munisipaliteit. (Translation of Afrikaans paragraphs follows.)

[Deputy Speaker, the negative experiences with public funds management in general, and more specifically in municipalities, have determined the need for this legislation. Within constitutional provisions, this is what the objectives of the Bill, clause 2, are aimed at.

The ACDP will support this Bill.

This legislation determines that municipalities must conform to strict prescriptions regarding financial management. See chapters 4, 7, 8, 9 and

1. However, this requires exceptional capacity within each municipality.]

Chapter 10 deals specifically with co-operative government. It commits national and provincial governments to assisting municipalities in capacity- building. It binds national and provincial departments and public entities to specific performance criteria in relation to municipal entities. It also clearly describes a mandate of Treasury in terms of their relationship with municipal entities.

The Bill prescribes very specific responsibilities to the mayor in terms of the financial management process set out in Chapter 7. He is basically responsible for ensuring that financial matters of a municipal entity are managed within prescribed timeframes and set standards. He must also, in reasonable time, report financial problems. Noncompliance may lead to termination of his position and even to the cessation of the council. The establishment of an independent audit committee in clause 166 needs to be highlighted. It will ensure objective evaluation of the financial management process.

An interesting and innovative introduction to this piece of legislation is a recovery mechanism in case of financial problems, which is in Chapter 13. This is a commitment to ensuring that community service is not compromised.

The need for this legislation cannot be disputed. It is involved, but necessary, well-considered and commits all relevant spheres of government to ensure sound financial management for municipal entities. It is thus supported.

Mnr P J GROENEWALD: Agb mevrou die Adjunkspeaker, die Vryheidsfront verwelkom hierdie wetsontwerp en steun dit. Die rede is dat die finansies op plaaslike regeringsvlak, na die mening van die Vryheidsfront, in ‘n chaotiese toestand is.

Ek wil vandag vir die agb Minister sê dat as dit gaan oor plaaslike regering en hulle finansies, is hulle in dryfsand en hulle is besig om verder en verder af te sak. Die gevolg, aan die einde van die dag, is dat die belastingbetalers van ‘n plaaslike regering meer belas moet word. Hulle tariewe moet styg omdat munisipaliteite nie meer die behoorlike finansiële dissipline het om toe te sien dat hulle ‘n behoorlike kontantvloei het nie. Daarom verwelkom ons hierdie wetsontwerp.

As ons hierdie wetsontwerp ‘n sukses wil laat wees, sal ons ook moet verseker dat die amptenary weet wat aangaan in hierdie wet. Ek aanvaar dat daar behoorlike opleiding gegee sal word, en dat munisipale bestuurders byvoorbeeld sal besef wat hulle verantwoordelikheid is.

Ek dink nie dit is billik en regverdig as belastingbetalers munisipale bestuurders se salarisse moet betaal, waarvan sommige s’n selfs ‘n halfmiljoen meer is as wat die agbare Staatspresident ontvang, en dan is dit die tipe van finansiële toestande waarin ons munisipaliteite se finansies is nie.

As ‘n mens verder in ag neem dat die agterstallige dienstegelde landswyd reeds meer as R25 miljard ten opsigte van plaaslike regering is, sê die Vryheidsfront dat hierdie wetsontwerp eintlik al vroeër moes gekom het. Ons hoop nie dit is te min vir te laat nie. Die werklikheid, as ons gaan kyk na die agterstallige diensgelde, is dat dit amper een en ‘n half keer die totale verdedigingsbegroting is. Ons kan nie so aangaan nie. Dit is tyd dat amptenare, en veral munisipale bestuurders, asook uitvoerende burgemeesters wat groot salarisse ontvang, na die finansies van belastingbetalers omsien. Hulle moet dié verantwoordelikheid nakom. Dankie, mevrou die Adjunkspeaker. (Translation of Afrikaans speech follows.)

[Mr P J GROENEWALD: Hon Madam Deputy Speaker, the Freedom Front welcomes this Bill and supports it. The reason for this is that finances at local government level are, in the opinion of the Freedom Front, in a chaotic state.

I want to say to the hon the Minister today that, as far as local government and their finances are concerned, they are in quicksand, and they are sinking deeper and deeper into it. The ultimate result is that the taxpayers of a local government must be taxed at a higher rate. Their tariffs must increase because municipalities no longer have the proper financial discipline to ensure that they have a proper cash flow. For this reason we welcome this Bill.

If we want this Bill to be successful we must also ensure that the officials know what this Bill is about. I assume proper training will be provided, and that municipal managers will know, for example, what their responsibility is.

I do not think it is fair and just for taxpayers to pay municipal managers’ salaries, some of which are even half a million rand more than that which the hon the State President receives, whilst this is the sort of financial state our municipalities’ finances are in.

Furthermore, if one takes into account that the service fees in arrears are already more than R25 billion countrywide with regard to local government, the Freedom Front says that this Bill should actually have been tabled earlier. We hope it is not too little, too late. In reality, if we look at the arrears service fees, we see that they are equal to almost one and a half times the amount of the total defence budget. We cannot go on like this. The time has come for officials, and especially municipal managers, as well as executive mayors who receive big salaries to look after the finances of taxpayers. They must fulfil this responsibility. Thank you, Madam Deputy Speaker.]

Mr F C FANKOMO: Madam Deputy Speaker, the promulgation of the Public Finance Management Act in 1999 marked a very important step in the implementation of the financial provisions of chapter 13 of the constitutional Act of 1996.

Today, again, we are debating another very important piece of legislation that pertains to financial matters at the delivery point of our Government. The Local Government: Municipal Finance Management Bill seeks to ensure secure, sound and sustainable management of financial affairs of municipalities at local government level.

In order to do this, the municipalities require budgets. As we know, the source of budgets at local government level is greatly dependent upon national funding and revenue collected through taxation. In terms of clause 17(2), local government also gets some funding from borrowings. The money that is being borrowed is used for capital projects.

The council of a municipality must first consider all the project costs for that financial year until the project is operational, before approving the project. Thus, by so doing, the municipal budgets and budget processes will promote transparency, accountability and effective financial management of the economy. The public sector, thus, is one of the constitutional requirements that characterise democratic elements.

Municipal budgets, according to section 215(2)(c) of the Constitution, must show the sources of revenue and the way in which proposed expenditure will comply with national legislation. The structure of the municipal budget must contain estimates of revenue and expenditure, and differentiate between the capital and current expenditure. It must, further, have an indication of intentions regarding borrowing and other forms of liabilities that will increase public debt during the ensuing year.

The mayor of a municipality is mandated by this Bill to table an annual budget at a council meeting 90 days before the start of the budget year. The council, therefore, must approve the budget. This budget should be divided into two, that is capital expenditure and operational budget. This is in line with the international best practice. Documents that should accompany the tabling of the budget are draft resolutions such as those approving the municipal budget, imposing municipal taxation and tariffs, and approving the budget for municipal entities and so forth.

After tabling the municipal budget, the accounting officer makes this public and invites community members to come and submit their inputs. The budget is submitted in printed electronic format to the National Treasury. This fund lapses when there is no money that has been spent by the end of the year.

Regarding financial reporting, this Bill provides that the council must prepare reports within six months regarding the activities of the municipal council. These annual reports provide a record of activities of the municipality and its entities during the financial year.

A report on performance against the budget promotes accountability to the community for decisions made throughout the year. Reports include the Auditor-General’s auditing reports, consolidated statements, annual performance and any explanation that may be necessary to clarify issues in connection with financial statements.

Issues raised by the Auditor-General’s report will enable the municipality to correct and ensure compliance with this Bill. Duties that are placed with the provincial MEC are to ensure that issues raised by the Auditor- General are corrected within the municipality. I thank you. [Applause.] Miss S RAJBALLY: Igama lamakhosikazi! [In the name of women!] Madam Deputy Speaker, the MF notes the immense power and authority that this Bill yields to National Treasury. It is hoped that its wide range of duties and responsibilities are within means to ensure proper management and efficiency of roles.

The MF is pleased with the authority and responsibility given to municipalities, in the light of financial management for which the financial reports will maintain assurance of proper management regarding public inspection. Provisions appear to be constitutional. These financial independencies are quite liberating for local government. Provisions made in respect of municipal budgets are supported by the MF.

In terms of debts incurred by the municipalities, the MF has no objections to provisions made in the light of short-term and long-term debts. Regarding the responsibilities of municipal officials, the MF is satisfied with the provisions that this Bill makes. It is, however, felt that the responsibility for financial matters that is placed on municipal council members is immense. The need for accuracy and efficiency, if strictly adhered to, would make this cumbersome duty more comfortable. Provisions made in terms of the establishment of municipal entities are acceptable, in the light of regulatory powers and functions.

The MF is especially pleased with the financial reporting and auditing provisions put in place to ensure proper management of affairs, accuracy and efficiency to the public. The resolution of financial problems, general Treasury matters and provisions regarding financial misconduct are well- devised.

The MF feels that this Bill has done a good job of addressing issues of transparency, accountability and sound management of municipal finances to suit our democracy and abide with constitutional requirements. The MF supports the financial management Bill. Thank you. [Applause.]

Mnr C AUCAMP: Agb Adjunkspeaker, derdevlakregering is van kritiese belang vir die toekoms van Suid-Afrika. Die sukses van Suid-Afrika staan of val by wat op derdevlakregering gebeur, daar waar ons die naaste aan die mense kom.

Die Nasionale Aksie is ten gunste van ‘n maksimale afwenteling van gesag na derdevlakowerhede toe. Daar is egter ‘n probleem: Hoe meer jy afwentel, hoe meer draf jy met jou derde span op die veld. Daarom verwelkom die Nasionale Aksie die maatreëls van beheer en verantwoorbaarheid deur en aan die provinsiale en nasionale owerhede wat in hierdie wetsontwerp ingebou is.

Ons verwelkom die feit van ‘n behoorlike begroting, want dis krities belangrik. Die driejaarbegrotingsraamwerk werk goed op nasionale vlak. Ons glo dit sal ook met munisipale vlak so werk. Die begrotingsvereistes wat gestel word is billik, en dit sal goeie beheer verseker, asook die maatreëls vir samewerkende regering wat in hierdie wetsontwerp vervat is.

Oor die algemeen kan aanvaar word dat die Suid-Afrikaanse ekonomie goed bestuur word. Ongelukkig kan dieselfde nie van die plaaslike owerhede gesê word nie. Jy kan die beste sisteem hê, maar dit kan val by die uitvoering daarvan. Papier is geduldig. My begroting werk ook, maar net op papier. Dit hang af hoe hierdie saak beheer gaan word.

As ‘n mens kyk na artikel 78(c) van die wetsontwerp, dan is dit ‘n verantwoordelikheid dat ``any unauthorised, irregular or fruitless and wasteful expenditure and any other losses are prevented’’.

Die vraag is: In hoe ‘n mate gaan hierdie artikel gebruik word om die R25 miljard wat aan plaaslike owerhede verskuldig is aan bande te lê, want dit is ‘n fruitless expenditure''? Verder, dat All revenue due to the municipality is collected.’’

Dit kan alleen gebeur as personeel volgens meriete en ervaring aangestel word, en nie volgens ander maatstawwe nie. Voorsitter, die Nasionale Aksie ondersteun hierdie wetgewing, maar onthou die woorde: ``Talk is cheap, but money buys the whisky’’. Ek dank u. (Translation of Afrikaans speech follows.)

[Mr C AUCAMP: Hon Deputy Speaker, third-tier government is of critical importance for South Africa’s future. The success of South Africa stands or falls by what happens in third-tier government, there where we get the closest to the people.

The National Action is in favour of maximal devolvement of power to third- tier authorities. However, there is a problem: the more you delegate, the more you run onto the field with your third team. Therefore, the National Action welcomes the measures of control and accountability by and to the provincial and national authorities which are incorporated into this Bill.

We welcome the fact that there is proper budgeting because this is critically important. The three-yearly budget framework works well at national level. We believe that it will also work like this at municipal level. The budgetary requirements that are laid down are reasonable, and will ensure good control, as well as the measures for co-operative governance which are contained in this Bill.

In general, it can be accepted that the South African economy is being managed well. Unfortunately the same cannot be said of local authorities. You can have the best system, but it can crumble in its operations. Paper is patient. My budget is also working, but only on paper. It depends on how this matter is going to be controlled.

When one looks at section 78(c) of the Bill, then it is a responsibility that: ``any unauthorised, irregular or fruitless and wasteful expenditure and any other losses are prevented’’.

The question is: To what extent will this section be used to curb the R25 billion which is owed to local authorities, because it is a fruitless expenditure''? Furthermore, that:All revenue due to the municipality is collected’’. It can only happen if staff are appointed according to merit and experience, and not according to other criteria.

Chairperson, the National Action supports this legislation, but remember these words: ``Talk is cheap, but money buys the whisky’’. I thank you.]

Mr B M SOLO: Madam Deputy Speaker, on behalf of the Portfolio Committee on Provincial and Local Government, I would like to echo the gratitude of our chairperson, Comrade Yunus Carrim, for the excellent co-operation that we received from the chairperson of the finance committee, Comrade Barbara Hogan.

The Local Government: Municipal Finance Management Bill is one of the major Bills in the consolidation of the new system of local government. We hope that the Bill would introduce stable and sustainable financial management in the sphere of local government.

A lot of reference has been made with regard to Chapter 4 of the Bill, and I am not going to repeat that, except to say that revenue projections in the budget must be realistic, taking into account the projected revenue for the current year which is based on collection levels to date and actual revenue collection in previous financial years. We are consciously aware of the debt that exists there. Our role, as legislators, is to try and assist municipalities to get out of that situation, and that is the responsibility of everybody in this House.

We believe that the provisions in Chapter 4 will place the municipalities on a sound financial base. The clauses compel municipalities to be realistic when they draw up their budgets, and thus avoid, to a large degree, the possibility of overspending.

Chapter 5 of the Bill addresses co-operative governance in budget preparations, which is an area that our portfolio committee has been grappling with consistently. Provinces have a responsibility to assist municipalities align their budgets and activities with the budgets of the municipalities in the integrated development programmes - IDPs. This chapter is explicit on the vital role to be played by national and provincial governments in building the capacity of municipalities for efficient, effective and transparent financial management. To this end, the assistance must be by agreement between the respective spheres of government.

There is also another dimension with regard to local government, namely entities that are contracted to ensure service provision in the most effective, efficient and sustainable way. The Bill, through Chapter 10, brings a lot of sanity in this regard. We note and appreciate the various partnerships with the whole range of sectors aimed at ensuring sustainable provisions of services and development.

Kodwa-ke kubalulekile ukuthi uma senza wonke lama-entity sibonakalise obala ukuthi umsebenzi okufanele bawenze bawenza ngendlela engcono neyenza ukuthi izimpilo zethu zibe nokuthuthuka. Esikhathini esiningi siye sithole ukuthi uma kwenziwa lama- entity, amanye awo abhekene namangcwaba, ugcina ungabe usazi ukuthi kuzokwenziwani emangcwabeni yinkontileka yabantu.

Yibo-ke ubuthakathaka obukhona lobo, okuzothi ngalo mThethosivivinywa esikhuluma ngawo sizame ukuthi sibulungise. (Translation of Zulu paragraphs follows.)

[However, it is important that if we form all these entities we make sure that they do the task at hand in a better way that results in the improvement of our lives. In most cases one finds that some of these entities, for instance, will target graveyards, and one wonders what a people’s contract has to do with graveyards.

That is the kind of weakness which prevails at present and which we are set to correct through this Bill under discussion.]

This Bill introduces mechanisms to oversee the activities of the various entities. It obliges municipalities not to abdicate their overall responsibilities and functions in order to ensure extension of services for a better life for all. Chapter 10 of the Bill deals with this matter extensively, but what is important is that it promotes more transparency, stability and predictability and thus strengthens governance on finances.

Let me not hesitate to mention that the Portfolio Committee on Provincial and Local Government recognises the leadership role played by Comrade Barbara Hogan who consistently highlighted key issues on fiscal discipline. In certain instances, we may have been found irritating, but this might emanate from our limited understanding of economics. Indeed, we learnt a lot from her and her committee. It was a great pleasure to work with her for a common goal of a better life for all through proper financial management.

Ngithanda ukuthi ngibhekise laphaya kubafowethu be-FF ukuthi mabayeke ukulokhu bebeka izici ngaso sonke isikhathi. Masizame ukusebenza sonke, sisebenzisane, ngoba inkinga yomasipala siyayazi lapho isuka khona. Besikade sikhokha kepha izinsiza zezidingo zethu singazitholi, singenakho nokubuza ukuthi sikhokhelani.

Akubantu kuphela abakweleta umasipala. Ngicabanga ukuthi lukhona ucwaningo olwenziwa olwaveza ukuthi kunezinkampani ezinamandla okukhokha kodwa ezingafuni ukukhokha, zifune ukulandelelwa ngoba umhlaba uhambile. Nanso-ke into abayaziyo.

Uma kulapha bakhuluma kakhulu kanti abekho kule nto esiyenzayo. Into abayizele lapha ukuzochitha isizungu. Make bazimisele futhi babamele abantu bakubo ngendlela efanele. Mabazibone izinkinga esibhekene nazo kuleli zwe, sikwazi ukuthi sonke sisebenzisane ngendlela efanele ukuze silungise lezo zinkinga.

Nokho sekukhulunywe kakhulu futhi angifuni-ke ukumosha into enhle kangaka. Lo mThethosivivinywa muhle kakhulu futhi i-ANC iyawuthokozela kakhulu. Ngizwile nabantu laphaya emakhaya bengitshela ukuthi bayawuthanda. Ngalawo magama amafushane, ngithi ngiyabonga. [Ihlombe.] (Translation of Zulu paragraphs follows.)

[I would like to address myself to our brothers and sisters in the FF and tell them that they should stop criticising all the time. Let us all try and work together because we know the origin of municipality problems. We used to pay without getting services, and we had no way of even asking what it was we were paying for.

It is not just individuals who owe the municipality. I think that some research was done which revealed that there are some companies which can afford to pay, but are not willing to do so and expect to be reminded all the time because they say the land had been taken. That is all they know.

When they are here they have a lot to say, yet they are not actually part of what we are doing. They are only here to while away the time. They must start being committed and represent their people properly. They have to realise the problems we are facing in this country, so that we can all work together properly and solve those problems.

A lot has been said, and I do not want to spoil such a good thing. This Bill is very good and the ANC is very happy with it. I have also listened to people in the rural areas telling me that they appreciate it.

With those few words, I would like to say thank you. [Applause.]]

The MINISTER OF FINANCE: Deputy Speaker, Msholozi, hon members, firstly, thank you for the broad support for the Local Government: Municipal Finance Management Bill. I think, in the nature of the debate here and in the nature of the many hearings that have been held on this legislation, it’s abundantly clear that all members of this House attach much weight to the value of local government in delivering not only in terms of services but, very importantly, in terms of the developmental mandate.

The hon Woods raised a number of issues about the approach that we might have considered. What we cannot escape from is that local authorities, like national and provincial governments, handle public money. Local authorities, in distinction to provincial governments, collect the bulk of their own revenue. In circumstances like these we need to ensure that the rules are in place. It is not about national Government playing nanny, but about ensuring that we have mechanisms in place that increase the level of accountability. By doing so, we are improving on the quality of our democracy.

That is the bulk of what this issue is about. In order to traverse a past from where some local governments are now, which is at a very perilous state, to what the Bill describes, we have to be organic. To release all of the controls will, I think, create mayhem which will see the poorest of the poor suffering the most.

The approach we are taking here is, in fact, in recognition of the independence and also of the interdependence of this particular sphere of government. With the help of the three committees that have been involved in this process - the Portfolio Committee on Finance, and the committees on provincial and local government, and on justice - I think we have got the balance right.

What is very important is that the 284 local authorities become learning organisations in their own name and right. Many organisations transform at their own pace. We’ve asked, as a very important support mechanism, both the Institute for Public Finance and Auditing, Ipfa, and the Institute of Municipal Finance Officers, Imfo, to be there and to carry these organisations. We are a little bit averse to creating new institutions.

I am hearing for the first time the proposals about new legislation for new public entities. I’d like to know what the mischief is that we need to fix. I’d like to know where these arise in the context of the Local Government: Municipal Finance Management Bill. However, what’s very important is that we leave this House recognising the importance of municipal government in the context of development, that we support them every step of the way to deliver services and development and, very importantly, that they are able to be publicly accountable for what they do.

The other provisions about aligning the IDPs and the Budget, I think, provide that impetus, and I’d like to thank all the parties for supporting this legislation. Thank you very much. [Applause.]

Debate concluded.

Bill read a second time.

         LOCAL GOVERNMENT: MUNICIPAL SYSTEMS AMENDMENT BILL

                       (Second Reading debate)

The DEPUTY MINISTER FOR PROVINCIAL AND LOCAL GOVERNMENT: Deputy Speaker, hon members, on 5 December, three months from now, our new system of local government will be three years old. It is critical that our deliberations here today appreciate the noble and gallant efforts that we have made in establishing and consolidating this sphere of government since 5 December 2000.

Today we have 284 municipalities established, which are led by a cadreship of over 8 000 councillors who are responsible for over 3 700 wards. We must commend our councillors who have pioneered this new system for their commitment, dedication and resilience and for sometimes working under very difficult circumstances. Nobody is actually applauding the fact that they work so hard, but anyway.

Together with local government, national and provincial government are currently in a phase of consolidating the core developmental municipal systems that we envisioned in the White Paper on Local Government in 1998 and subsequently articulated in the Local Government: Municipal Systems Act of 2000. The final stage of local government transformation is an integral part of our strategic objective of stabilising our entire system of co- operative government as we approach the end of the first decade of freedom and democracy.

In celebrating 10 years of freedom and democracy, we must reflect on where we have come from and the gains that we have made as a nation. It is also important for us to assess progress and propose and implement additional measures that will firmly entrench the developmental orientation of the state and all its organs. Our single motivating objective in addressing the inequitable legacy of apartheid is that of improving the quality of the lives of all our people as we strive to build a united nonsexist, nonracial and democratic South Africa.

The Local Government: Municipal Systems Amendment Bill before us today is an important milestone in the trajectory towards creating a sustainable local government sphere. The significance and rationale of this legislation is that it seeks to confirm and defend the existing policy orientation that we have adopted on developmental local government. It must also be mentioned at the outset that this Bill is largely a consequential set of amendments arising from the Local Government: Municipal Finance Management Bill, which we have just debated.

The Local Government: Municipal Systems Act of 2000 outlined the core systems of community participation, integrated development planning, municipal service delivery and performance management that underpin our system of local government.

The Local Government: Municipal Systems Amendment Bill proposes key refinements to the Local Government: Municipal Systems Act of 2000. In the first instance, these amendments are central in our efforts to strengthen the core systems of local government. In our view, the past three years of local government and of municipal service delivery have yielded some significant lessons and observations which require regulatory intervention. Of paramount importance is our objective of addressing and resolving the critical implementation changes arising from existing policy.

Secondly, we live in a political democracy where our elected representatives must account to our people on their elected mandate. An important lesson that we have learnt in the last few years of democratic local government is that we must continuously find ways of strengthening the political oversight role of councillors in municipal affairs, and municipal service delivery in particular.

Thirdly, this Bill is aimed at complementing the proposed legislation on municipal finance management that has just been debated and passed by this House today. All of us would agree that our municipal finance management systems require urgent attention. In our view, the municipal finance management legislation will go a long way in addressing the challenges that we have identified. Together, the two Bills being debated today will fortify the foundation of our system of local government that we have already started building.

Finally, consistent with the approach taken by the Local Government: Municipal Systems Act of 2000, the Local Government: Municipal Systems Amendment Bill encompasses a delicate combination of enabling and mandatory provisions. The mandatory provisions reflect the cardinal policy principles that are indispensable to our vision of developmental local government, while the enabling provisions cater for provincial and local specificity and conditions in giving effect to our policy.

Although the Local Government: Municipal Systems Amendment Bill seems limited in scope, it is far-reaching in its application. Let us for the moment reflect on some of the key provisions and policy thrusts that this Bill seeks to impart. The process whereby national and provincial government departments are assigning powers and functions to local government is currently taking place both consciously and, in some instances, unintentionally.

The Bill requires of those introducing legislation of this nature to do so in such a manner that national and provincial governments can appropriately and timeously anticipate, plan, manage and resource these assignments. The policy message is that we need to make our system of government more predictable and transparent with regard to how national and provincial governments specifically interact with local government.

Further, in an effort to enhance community participation and make local government more accessible and transparent, the Bill outlines the necessary mechanisms for increased access to public documents of the municipality. These mechanisms include dissemination of information by the relevant municipal offices and through an official website of the municipality, if one exists. These provisions will not only deepen our system of local governance, but will also have the value of facilitating co-ordination and integration between organs of state in the three spheres of Government.

We have recognised the challenge faced by many municipalities of attracting and retaining competent and skilled personnel. This is especially the case in respect of municipal managers and those who directly report to the municipal manager. This Bill further seeks to ensure complementarity with the provisions of the Local Government: Municipal Finance Management Bill, and also confirms the principle of linking the awarding of performance bonuses to a formal process of performance evaluation.

The objective of enhancing and broadening municipal service delivery is one that must continue to seize our attention across all spheres and arms of Government. On this very important matter the Bill proposes a number of measures aimed at: assisting municipalities to engage in a much more robust and thorough process of deciding on the benefits of external municipal service delivery options; rationalising the regulatory environment for the establishment of municipal entities in order to limit the liabilities that such entities may impose; clarifying the governance arrangements of these municipal entities; strengthening the political oversight of councillors over such entities and lastly, allowing for transitional arrangements for existing municipal entities in a manner that protects current good practice. This Bill requires municipalities to undertake a feasibility study which will force them to make well-informed decisions regarding the available options in municipal service delivery. The recent lessons we have learnt from some of the long-term contracts which municipalities have entered into point to, amongst other things, inadequate preplanning and a limited consideration of all the envisaged cost implications, benefits and risk factors. An important element of this provision is the requirement for national and provincial government to assist municipalities in taking the feasibility study, if such assistance is indeed requested by the municipality.

The Bill reinforces the prerogative of municipalities to establish municipal entities consistent with the constitutional mandate given to local government. However, it limits the scope of municipal entities that may be established to three kinds of entities. These are private companies in terms of the Companies Act, the service utilities and the multijurisdictional service utilities. The new provisions broaden the purpose of these municipal entities to include the performance of any municipal power or function.

The Bill seeks to ensure that good corporate governance principles inform the operation of these municipal entities, whilst at the same time balancing the imperative of political oversight. For example, the Bill makes provision for municipal representatives to attend all meetings of the board of directors. This oversight role is further enhanced by various reporting obligations between the municipal entity and the municipality.

The Bill is sensitive to the wide array of well-performing municipal entities that currently exist in that the transitional arrangements in the Bill allow these entities to continue to exist, in so far as they comply with this legislation. I would like to reiterate that at the end of the day all the amendments contained in this Bill strengthen and increase the predictability of the new local government system.

We would like to acknowledge the commendable work done by the Portfolio Committees on Finance and on Provincial and Local Government and their support staff in jointly processing this Bill. We have taken note of the report on the Local Government: Municipal Systems Amendment Bill tabled by the portfolio committee. The Ministry and the Department of Provincial and Local Government will continue to interact with the committee and Parliament in all the relevant matters raised in this report.

The project of local government transformation in this country is informed and driven by the interests of a plethora of stakeholders, institutions and organisations. Therefore, we must also express our appreciation for the substantial number of submissions and invaluable comments that we received from the various sectors of our society.

We also wish to thank Salga for their contribution in the legislative process. As I mentioned earlier, we are three months away from celebrating the three years of our new system of developmental local government. In celebrating this event, one of the initiatives that our department announced in June this year was the Vuna Awards for municipalities. This is a municipal performance excellence awards initiative which seeks to encourage constructive competition between municipalities.

The first national performance excellence awards to municipalities will take place on 5 December this year. In the build-up to this event, provinces will be recognising and presenting awards for municipal performance excellence between September and November.

We are confident that this legislation will greatly enhance the current systems and performance of municipalities. The Local Government Municipal Finance Management Bill together with the Municipal Systems Amendment Bill will be an important step in South Africa’s local government history. We commend this Local Government: Municipal Systems Amendment Bill to this House. Thank you. [Applause.]

Mr Y I CARRIM: Mr Chairperson, Deputy President, comrades and friends, as you have heard, this Bill effectively flows from the amendments that arose while the Portfolio Committee on Finance was processing the Local Government: Municipal Finance Management Bill.

Essentially, as people have indicated, the Bill serves to strengthen the governance role of municipalities in respect of municipal entities and the assignment of new powers and functions to local government by national and provincial governments.

Municipalities have long complained that national and provincial governments assign new powers and functions to them without giving them the money to carry these out. The space for these unfunded mandates is now considerably reduced. The full financial implications of these assignments have to be spelt out before they can be effected, and the role of the Financial and Fiscal Commission in this regard has been strengthened. The capacity of municipalities to carry out these assignments also has to be assessed at the outset. So, to ensure greater municipal control of municipal entities, these entities are now limited, as explained by the Deputy Minister, to private companies, service utilities and multijurisdictional service utilities. However, they can be established not just to provide services, but to fulfil other municipal functions as well.

For example, an entity could be established not just to provide water services, but also to carry out the function of water meter-reading. A municipal entity may also be established to carry out municipal functions that do not necessarily relate to municipal services such as the provision of information technology support to a municipality. This expanded role is explained in greater detail in our report to Parliament which is carried in Monday’s Announcements, Tablings and Committee Reports.

It needs to be mentioned that sections of Salga initially felt that councillors should serve on the board of directors of municipal entities to ensure accountability. However, after concerted negotiations with Salga, a consensus emerged that councillors and officials should be nonparticipating observers at board meetings and that other provisions should be strengthened to ensure this accountability that they call for. Our committee is aware that these provisions may not be adequate and will in future, in consultation with the finance committee, consider a review of these provisions, should it become necessary to do so.

In processing clause 8 of the Bill, the issue of municipal managers’ remuneration was once again raised. Our committee has repeatedly called for the Minister to regulate municipal managers’ remuneration. We realise, however, that this is easier said than done. In the first instance, it may not be constitutionally tenable to do so.

Also, local government is a specific sphere of government that comprises 284 municipalities of three categories and different types, which also differ in terms of population size, budgets, service delivery, responsibilities and in other respects. We certainly need more information on what precisely managers earn and what exactly their respective responsibilities are.

Of course, municipal managers are not appointed any longer on a permanent basis, but on employment contracts of five years. This was a deliberate decision taken by Parliament to ensure that municipal managers are productive, effective and accountable. The employment contracts include performance contracts, which set clear performance targets and indicators and often include bonus payments for municipal managers, provided they achieve the targets set. So, it would not be easy to implement national regulations in these circumstances.

Of course, to attract highly skilled and efficient managers, municipalities often have to compete with high private sector salaries. Often, the municipalities most in need of highly skilled municipal managers are the smaller and rural municipalities who can least afford them. Yet, to draw the requisite skills, these municipalities have to offer high salary packages in competition with the financially better-off municipalities.

Therefore, the committee is pleased to learn that the report on managers’ remuneration, commissioned by the Minister, has been finalised. We have requested the department to present the findings of the report to our committee within eight weeks.

There were several other issues that were raised in our processing of the Bill. For example, Salga had suggested that there are aspects of the municipal legislation that need to be reviewed. None of the proposals for review deal with the fundamental core principles or features of the new model of local government. In that context, therefore, our portfolio committee welcomes such a review, provided it’s based on the practical experiences that municipal councillors and officials have undergone in the past three years or more.

Moreover, it needs to be said that other speakers in this debate will cover other issues that arose in our processing of the Bill. Yet other issues are to be found in our report published in Monday’s ATC. However, if one looks at the Local Government: Municipal Finance Management Bill, which is being passed today in this House, and the Local Government: Property Rates Bill that’s before our committee, they constitute part of a review of the financial model for local government.

We’ve got, we believe, a wonderful, very progressive new system of local government, but the two key areas in which we face constant challenges are, firstly, in the area of the need for a new financial model, and also in the area which is related to this, the need for greater capacity. Our committee has consistently held that it will take some 10 to 15 years to implement the new model. Our views on the progress in that regard are set out in our study tour report, which this House adopted in the form of a resolution several months ago.

In conclusion, I want to express our appreciation to the Portfolio Committee on Finance for the co-operation they extended to us. Our thanks also go to Elroy Africa and the rest of the Department of Provincial and Local Government, and in particular Petra Bouwer, for their sterling performance. Yet again - I hope the Deputy Minister is listening to that - Petra Bouwer has been outstanding in processing the Bill. [Applause.]

We also convey appreciation to Ismail Momoniat and his National Treasury team, and to both our Minister and Deputy Minister, and the Minister and Deputy Minister of Finance.

Finally, the person who sent me this rude note which reads - and this is from a senior member of this Parliament - and whose name I shall keep undisclosed for now says: This is death! Please, spend less than the eight minutes you've been accorded.'' So, I am using 46 seconds less than I should to rescue this person, but I might add that he said this is death’’, Barbara Hogan, when your committee was debating the Local Government: Municipal Finance Management Bill. So, this letter should have been addressed to you. Nevertheless, it’s 32 seconds before time. Thank you very much. [Applause.] Mnr W P DOMAN: Adjunkvoorsitter, die DA ondersteun hierdie wetsontwerp omdat die toepassing daarvan ‘n meer effektiewe regering en beter finansiële bestuur van munisipaliteite behoort mee te bring. Ons is sensitief daarvoor dat daar nie onnodig ingemeng moet word in die plaaslike regeringsfeer nie, maar terselfdertyd sal munisipaliteite moet aanvaar dat hulle nie kan ontsnap van die streng finansiële beheer en verantwoording waaraan die ander sfere van regering onderworpe is nie. In hierdie verband sal ons ook graag wil sien dat provinsies, en by name die LUR’e en departemente van plaaslike regering, hul regmatige grondwetlike rol van oorsig, monitering en ondersteuning speel.

Behoorlike prestasiebestuursooreenkomste met die top personeel by munisipaliteite is die een saak wat nog nie by alle munisipaliteite beslag gekry het nie. Ons verwelkom dit dat hierdie wetsontwerp prestasiebonusse ook verbind aan finansiële bestuur en vereis dat behoorlike evaluering na afloop van ‘n finansiële jaar gemaak moet word, voordat enige bonusse uitbetaal word. Op 10 Augustus vanjaar het City Press berig oor die byna bankrot Maquassi Hills-munisipaliteit in die Noordwes wat meer as 80% van sy begroting aan amptenare se salarisse bestee, en dit sonder dat enige prestasiebestuurooreenkomste in plek is. Dit is al klaar erg dat veral top amptenare buitensporige salarisse ontvang, maar dan ook nie eers gebind is om te presteer nie. Die toppunt is soos onlangs by Theewaterskloof- munisipaliteit waar die munisipale bestuurder nie presteer het nie en daarvoor vergoed word met ‘n skeidingspakket van miljoene.

Hierdie wetsontwerp gaan meebring dat munisipale rade meer verantwoordelik sal moet optree. Munisipale rade moet besef dat as hulle munisipale bestuurder en ander amptenare nie presteer nie, dit hulle verantwoordelikheid is, want hulle het hierdie mense aangestel.

Aangesien hierdie wetsontwerp ook handel oor die ingewikkelde verhouding van munisipale rade met munisipale entiteite, wat deur eersgenoemde tot stand gebring kan word, verwelkom ons dat dieselfde beginsel geld, naamlik dat munisipale rade verantwoordelik bly, of die entiteit nou ‘n diensverskaffer of ‘n privaatmaatskappy is. As dit vorentoe nodig blyk, sal strenger wetgewing moet kom oor hoe entiteite verantwoording moet doen.

Ten slotte is die toewysing van ekstra magte en funksies, hetsy van nasionaal of provinsiaal aan munisipaliteite, ‘n teer saak as die nodige toewysing van fondse nie ook daarmee gepaard gaan nie. Daarom verwelkom ons die bepaling dat behoorlike volhoubaarheidstudies gedoen moet word voor die toewysing van ekstra funksies of magte.

Of al die munisipaliteite oor die kapasiteit beskik om hierdie wetsontwerp se bepalings uit te voer, staan sterk te betwyfel, maar ons moet ‘n begin maak vir strenger beheer.

Dit was lekker om ‘n deel van hierdie twee komitees te wees wat na insette een geluister het en deeglike oorweging aan hierdie wetgewing gegee het. Ek dank u. (Translation of Afrikaans speech follows.)

[Mr W P DOMAN: Deputy Chairperson, the DA supports this Bill because the implementation thereof should bring about more effective governance and better financial management of municipalities. We are sensitive to the fact that there should not be unnecessary interference in the local government sphere, but at the same time municipalities will have to accept that they cannot escape the strict financial control and accountability to which the other spheres of government are subject. In this regard we would also like to see provinces, and specifically the MECs and departments of local government, playing their rightful constitutional role of oversight, monitoring and support.

Proper performance management agreements with top staff at municipalities is the one issue which has not yet been sorted out at all municipalities. We welcome the fact that this Bill also binds performance bonuses to financial management, and requires that adequate evaluation must take place at the end of a financial year before any bonuses are paid out. On 10 August this year City Press reported on the virtually bankrupt Maquassi Hills municipality in the North West which spends more than 80% of its budget on officials’ salaries and that without any performance management agreements being in place. It is bad enough that top officials in particular receive exorbitant salaries, but are then not even bound to performing. The ultimate example occurred recently at the Theewaterskloof municipality, where the municipal manager did not perform and was compensated for that with a severance package worth millions.

This Bill will result in municipal councils having to act more responsibly. Municipal councils must accept that if their municipal manager and other officials do not perform it is their responsibility, because they appoint these people.

As this Bill also deals with the complicated relationship between municipal councils and municipal entities, which can be brought into being by the first-mentioned, we welcome the fact that the same principle applies, namely that municipal councils remain responsible, whether the entity is a service provider or a private company. If it becomes necessary in future, stricter legislation will have to be prepared on how entities have to account.

In conclusion, the allocation of extra powers and functions, be they national or provincial, to municipalities is a delicate matter if it is not accompanied by the necessary allocation of funds. We therefore welcome the provision that proper sustainability studies must be done prior to the allocation of extra functions or powers.

It is highly questionable whether all the municipalities have the capacity to execute the provisions of this Bill, but we must make a start for stricter control.

It was a pleasure to be part of these two committees which listened to inputs and gave thorough consideration to this legislation. I thank you.]

Dr G G WOODS: Deputy Chairperson, I acknowledge the views of the hon Peter Smith in my speech. There is a general need to review the implementation of the Local Government: Municipal Systems Act and then to amend specific provisions whose execution has unintended consequences which fail to adequately address the challenges of transforming local government.

The process of translating this exercise into further amendments of the Local Government: Municipal Systems Act is likely to commence soon. The Bill before us, however, does not have this intent. It does not arise from a general review of the municipal system of governance or from a particular set of problems that have to be urgently fixed. It is rather the legislative flip side of the Local Government: Municipal Finance Management Bill, whose very detailed provisions sometimes overlap or conflict with those of the Local Government Municipal Systems Act, or which, from the perspective of the legislative architecture of the post-1994 municipal legislation, are better located in the Local Government: Municipal Systems Act.

One of the very positive decisions taken very early on and indeed insisted on by the local government portfolio committee was that these amendments should not be affected by the Local Government: Municipal Finance Management Bill, but rather by way of amendments to the principal Act. From the perspective of anyone other than a lawyer, it makes far more sense to package legislation in a manner that is user-friendly than in a manner which, while technically perfectly acceptable, impedes the very important objective. After all, a law is written not only for lawyers, but for councils, council employees, NGOs, etc.

The Bill is not contentious, or perhaps this should be rephrased: the Bill is not contentious now. In the form in which the committee received the Bill, however, there were a number of provisions that were patently unconstitutional and which the IFP sought to have removed. Fortunately this was not too difficult, because we are not talking about provisions which offended the IFP alone. Even the ruling party with a predilection for strengthening the national Government at the expense of the provinces, recognised that something was amiss.

What the IFP finds astounding is how such provisions were inserted in the Bill in the first place and, secondly, how the state law advisers managed to certify a Bill containing such provisions.

It is worth emphasising that many of the complexities of the legislation - and this applies to the Local Government: Municipal Finance Management Bill

• are precisely because the municipal environment is complex. It is undoubtedly more complex a sphere than provincial governments, for example, and confronting us as legislators is always the challenge of incorporating in our law the need to balance the complexity of the environment and the flexibility to respond appropriately.

We need to recognise the vastly differing operating environments of municipalities, but by the same token, since municipalities vary so much in their capacity, resources, challenges and the like, one has to be wary of creating a smorgasbord of options which foolhardy municipalities may flounder upon. In respect of the manner in which the entities are defined and permitted to function, the Bill manages to strike a reasonable balance. Associated with this, they are not identical as they ally a challenge of creating a balance between a strongly regulatory and a permissive approach. Again, we feel a reasonable balance has been struck. In conclusion, the IFP supports this Bill.

Mr J DURAND: Madam Speaker, the provisions of the Bill will facilitate effective corporate governance systems of municipalities and would streamline the execution of the assigned functions and powers to municipalities, as well as facilitate service delivery through provisions relating to matters such as service delivery agreements and the establishment of municipal entities.

The implementations pertaining to these provisions will depend on the extent to which they are applicable to specific municipalities. The Bill will further allow municipalities the right to create a municipal entity to provide a more effective and efficient service to the public.

The New NP is very pleased with this amendment because it will also limit the involvement of officials and councillors in the day-to-day management of these external service providers, which will allow them to function on business principles.

The Bill also allows Cabinet to assign additional functions or powers to municipalities. This is a major step towards truly developing local government to serve in the needs of the people. It further gives the Minister the right to issue guidelines in order to regulate issues such as a tariff structure, limits on tariff increases, incentives and penalties to encourage the economical, efficient and effective use of resources when providing services.

It tightens up the code of conduct for councillors to also apply to the directors of municipal entities. The New NP supports this Bill.

Ms R M SOUTHGATE: Deputy Chairperson, the amendments to the Local Government: Municipal Systems Act are consequential amendments flowing from the Local Government: Municipal Finance Management Bill. The nature of the amendments is to facilitate the corporate governance systems of municipalities, streamline the execution of assigned functions and powers of municipalities, and also to refine performance contracts and municipal websites.

In the assignment of a function or power to local government any Minister must, prior to tabling that legislation, get the Financial and Fiscal Commission to assess the cost and the impact which that function or power will have on local government. Unfunded mandates have been one of the elements that negatively impacted local government resources and hampered effective service delivery.

Appropriate steps must be taken to ensure that capacity initiatives are implemented and that municipalities have the fiscal capacity to perform that function. I would support that tougher provisions must be inserted in the PMFA with reference to assigning functions.

The ACDP endorses the portfolio committee’s call that the Minister and the department urgently develop firmer guidelines on the remuneration of municipal managers. The ACDP supports the amendments.

Miss S RAJBALLY: Deputy Chairperson, the provisions made in this Bill to bring it in line with the Local Government: Municipal Finance Management Bill just debated are found by the Minority Front to be both necessary and adequate.

The strengthening of the political authority of municipal councils is liberating to local government independence. The enhancing of service delivery by certain provisions would be pleasing, not only to the Minority Front and to the public assurance, but to Government as a whole in terms of efficiency.

The Minority Front strongly agrees with the provisions made to avoid fragmentation. Provisions, especially in terms of sufficient funding for municipalities, would be extremely pleasing to local government authorities and extremely beneficial to effectiveness of municipal projects.

The Minority Fronts feels that official websites for municipalities would be beneficial in terms of public accessibility, information and communication. Performance reports would also maintain responsibility. The Minority Front supports the Local Government: Municipal Systems Amendment Bill.

Mr S A MSHUDULU: Deputy Chair, the House at large, I would like to first confirm the ANC’s determination to push back the frontiers of poverty and underdevelopment, as confirmed by our President Thabo Mbeki in his state of the nation address. I would also like to confirm that I stand here on behalf of the ANC in support of the Bill.

I do not want to repeat what has been said, but in my speech I will repeat some of the points for emphasis. I will go directly to chapter 8 of the Local Government: Municipal Systems Act, as it was dedicated to municipal delivery. This section provides for municipalities to give effect to constitutional obligations in terms of giving priority to basic needs of local communities and the promotion of developmental local government and some of the services, by ensuring that they can be accessed by all. These services must be equitable and accessible. It also touches on the provision of services in a manner that is prudent, economical, efficient and effective in the use of available resources, and it relates to the improvement of standards of quality over time. Standards must be reviewed on a regular basis with a view to upgrade, extend and improve them.

Therefore, it is against this background that the amendments have relevance regarding the issue of municipal capacity to deliver being central. The House might have benefited from speakers before me, from all sides, who outlined the importance of these two Bills: the Local Government: Municipal Systems Bill, as well as the Local Government: Municipal Finance Management Bill, as they are premised on or aligned to the Public Finance Management Act. Without having to lecture you on the fundamentals, I want to repeat that the Public Finance Management Act is based on smart principles where budgets have to be specific, measurable and realistic, as well as the fact that targets must be achievable.

It is important, especially to the committee on local government after it has gone to the provinces, that our members here who have constituencies in local areas are aware of the problems our municipalities encounter. Our municipalities do not have capacity, and not all of them have resources.

Although there have been allocations, the biggest problem was how to transfer or how to manage the funds that might have been allocated to them. I will give an example. In terms of our national budget, the composition of local government shares comprises transition grants, water and sanitation grants, water services projects, community-based public works programmes, grants for sports and recreation facilities, the national electrification programme, the urban transport fund, the integrated sustainable rural and development fund, a municipal infrastructure grant, a restructuring grant, a financial management grant and a municipal systems improvement grant.

All these grants cannot be distributed if a municipality does not have capacity. For these reasons, many municipalities today are unable to provide municipal services to all because of the infrastructural backlog that was also created by apartheid planning.

The overall goal is to improve the quality of services and the extension of services to all. When a municipality does not have capacity, the Local Government: Municipal Systems Act does allow for external measures that include a municipal service partnership, for instance, an agreement between a municipality and a service provider. It was mentioned by our Deputy Minister that they have to go through a feasibility study first that evaluates capacity and that identifies what has to be done.

It is also important that I must emphasise that the Bill allows for entities to account in terms of the Municipal Finance Management Act. This will also address the question our chairperson has raised earlier, namely that there is no way that municipal entities can be established without having to deliver services that are relevant.

For this reason I support this Bill on behalf of the ANC. I believe that our members will also benefit from the experience, as well as the report that the chairperson has earlier confirmed, namely that a challenge remains for all of us as members of Parliament, that when we go back home we have to make sure that we are directly involved and make a contribution. I thank you. [Applause.]

The DEPUTY MINISTER FOR PROVINCIAL AND LOCAL GOVERNMENT: Deputy Chair, firstly, I would like to thank all the members who participated in this debate, and I would like to thank them all for their very constructive contributions. The hon Gavin Woods, I thought that the whole purpose of the deliberations in the portfolio committees was exactly that of trying to come up with a very good piece of legislation. The idea was to take the Bill to be refined in the portfolio committee, and to then come up with this very good piece of legislation that we have today.

As the hon Doman was moving away from the podium after completing his speech, I heard murmuring in some ANC benches, and somebody was whispering: ``What did we do wrong that the DA is also supporting this legislation?’’ [Laughter.] Thank you everybody for supporting this Bill. [Applause.]

Debate concluded.

Bill read a second time.

                PENSIONS SECOND (SUPPLEMENTARY) BILL

The MINISTER OF FINANCE: Deputy Chairperson and hon members, this is a profoundly moving piece of legislation. I move the Bill. Thank you very much.

Bill referred to the Portfolio Committee on Finance for consideration and report.

The DEPUTY MINISTER OF FINANCE: Deputy Chair and hon members, we introduce in the National Assembly, for the second reading, the Government Employees Pension Law Amendment Bill and the Special Pensions Amendment Bill of 2003.

On 27 April 1994 seven former forces were integrated to constitute the SA National Defence Force. In 1995 six former intelligence services were amalgamated into two intelligence services for the Republic of South Africa, namely the National Intelligence Agency and the SA Secret Service.

Former members of the non-statutory forces or services did not have the opportunity to obtain membership and to contribute to a pension fund prior to the aforementioned integration. Furthermore, their services in the former non-statutory forces or services have not been recognised yet for the provision of pension benefits. This creates disparity between members of the former statutory forces or services and former non-statutory forces or services regarding the recognition of pensionable service for purposes of calculating pension benefits.

Broadly speaking, the aim of the proposed legislation is to place former members of non-statutory forces or services who are members of the Government Employees Pension Fund in a position similar to that of the former statutory force or service members regarding the recognition of service for pension purposes.

Deputy Chair, I would like to explain briefly the most salient principles contained in these Bills. The Government Employees Pension Law Amendment Bill amends the Government Employees Pension Law, proclamation 21 of 1996, and provides for a definition of ``former member of a non-statutory force or service’’.

It also provides for the recognition of services rendered in a non- statutory force or service as pensionable service. Such recognition will result in an increase in pension benefits payable to former non-statutory force or service members, or their beneficiaries when such a member or pensioner is deceased.

The Bill also provides that the benefits payable, in terms of the Government Employees Pension Law, will be reduced in accordance with the rules of the fund where a former member of a non-statutory force or service receives or has received in his or her own right a benefit in terms of the Special Pensions Act. This provision applies where the member’s non- statutory service is recognised as pensionable service.

The Special Pensions Amendment Bill amends the Special Pensions Act and provides that a person’s right to a pension in terms of the Special Pensions Act ceases when that person’s non-statutory force service is recognised as pensionable service in terms of the Government Employees Pension Law. It also confirms that a dependent of a person whose service in a non-statutory force or service is recognised as pensionable service, may continue to receive a special pension in his or her own right.

In tabling the Bills before this House for consideration, we owe special thanks to the Chair of the Portfolio Committee on Finance for her excellent adjudication of the debate in the committee, and to the members of the committee for their constructive contributions. We are confident that these Bills represent the Government’s commitment to a process of ensuring equality and redressing the discriminatory practices of the past. Thank you very much, Deputy Chair. [Applause.]

Mr N M NENE: Mr Chairperson, hon members, for the majority of our combatants and former members of the liberation armies, this is indeed a groundbreaking piece of legislation even though, when these movements were formed, none of these liberation fighters joined for any material or financial gain. They only joined for the liberation of this country and to bring about a democratic and nonsexist society. The so-called former non- statutory forces are none other than the very organisations that made possible the democracy that we are all proud of today.

The 1994 miracle would not have been possible without the contribution of these non-statutory forces. A number of attempts have been made by the ANC Government to recognise the contribution of these non-statutory forces.

A number of efforts, as I have indicated, have been about them, but no amount of financial reward would ever be sufficient to honour this kind of contribution. This Bill seeks to redress a very critical part of the former members of the non-statutory forces’ integration into the statutory forces, particularly the SANDF, the SAPS, and the National Intelligence Agency.

The amendment to the Government Employees Pension Law of 1996 provides for the recognition of service that these cadres rendered selflessly in these non-statutory liberation forces. Some of these comrades even laid down their lives for this cause, and some of them disappeared, never to be seen again.

This Bill is a further demonstration of the ANC’s commitment to equality and justice for all. The members of the previous statutory forces were members of the pension fund, and when they were integrated into the new dispensation, their service to the previous order was recognised.

This Bill creates an enabling legislative framework that would allow for subsequent processes to take place in order to address the plight of many of our liberation fighters. One of these processes has already been outlined by the Deputy Minister in his speech.

For members to benefit from this arrangement, certain details needs to be clarified in this House namely that an amount of R1,5 billion was set aside from the Government Employees Pension Fund during 1998 and approved by Cabinet, that in any pension fund both the employer and the employee must make contributions towards the fund, and that the period for which a member has contributed needs to be taken into account.

In order to address these issues this Bill, through a number of measures, does the following: members are grouped into categories that take into account the length of time that they served in their liberation forces, and I wouldn’t want to bore you with those categories. Actuarial calculations have established the value of both the employer’s and the employees’ contributions and an appropriate apportionment has been worked out. An amicable mechanism has also been devised to accommodate the members’ contributions without financially prejudicing the former members of the non- statutory forces, as they did not contribute in the past. Extensive deliberations took place in the Public Service Co-ordinating Bargaining Council, culminating in resolution 7/98 that provides for matters that this Bill seeks to achieve. In order to qualify, the former members of the non-statutory forces need to meet certain requirements. I’ll mention only two of those requirements. The first one is that former members’ names must appear on the Certified Personnel Register as contemplated in the interim Constitution of the Republic of South Africa, section 224(2)(c) or the personnel list, which is defined in section 1 of the Intelligence Services Act of 2002. The former member also must have been part of the integration process in the SANDF, SAPS or the National Intelligence Agency.

The other category is that of people who have been paid benefits owing to them by the fund upon cessation of their membership that may have been entitled to additional benefits. This amendment further directs that their service in the non-statutory force or service be taken into account.

The ANC-led Government recognises that the measures taken may not be completely adequate to address disparities and inequities that were imposed upon us by the apartheid regime over the years. This piece of legislation is but one of those many attempts that are undertaken under all sorts of constraints. At times, we do not realise the magnitude of the problem of inequality facing us and how deep-rooted it is.

I am reminded of a lengthy quote by an American philosopher, Ronald Arenson, in 1991, who wrote as follows:

``The American lesson is a painful but simple one, because we have to make the universal rights available to everybody regardless of class, race or national origin. The heritage racial domination continues to perpetuate itself … Without vigorous political action on national level, without social transformation stretching far beyond affirmative and equal opportunity', South Africa's black majority will follow in the pattern of America's black minority, reproducing itself spontaneously’ in a hereditary poverty.’”

This was and still is a clear indication that we compare with mature democracies, but our solutions are different, as we do not want to follow the route that this philosopher warned us about.

The last part of this Bill deals with a cross-reference to the Special Pensions Act, and therefore necessitates a consequential amendment to the Special Pensions Act. This refers to those members who are currently receiving benefits under the Special Pensions Act, and that the benefit payable to them will be reduced in accordance with the rules. Indeed, the tide is turning, and the ANC will continue championing this worthy cause. The ANC supports this Bill. [Applause.]

Brig Gen P J SCHALKWYK: Deputy Chairperson, hon Deputy Minister of Finance, Deputy Minister of Defence and hon members, the two amending Bills before the House concern the recognition, by way of pensions, for service in non- statutory forces and other related services, such as intelligence and security.

There is no more honourable a gesture in any country than for a government to honour, materially, those soldiers, combatants and others who served their country for the cause in which they believed.

The main role-players referred to in these Bills are the ex-combatants of the non-statutory forces, but please, allow me to refresh your memory as to who is a veteran, as defined in the Military Veterans’ Affairs Act of 1999. It says ``a military veteran is any person who served in the Union Defence Force, the SA Defence Force, the SA National Defence Force and any non- statutory force, as defined in the Demobilisation Act.’’

This gesture of the Government will also be appreciated by the World Veterans Federation, which will be holding its 24th general assembly of the federation in South Africa during December of this year. Seventy-four countries are affiliated to the federation, representing over 30 million veterans.

The credo of this federation is worth mentioning. It talks about veterans and says:

No one can speak more adequately for peace than those who fought in war. The voices of war veterans are a reflection of the language for peace of people the world over. Humanity has earned the right to peace. Without it, there can be no hope for the future, and without hope, man is lost.

Ex-soldiers or combatants are often forgotten when conflicts come to an end. Forgotten are the risks that they took, forgotten are the hardships that they had to endure, forgotten are the periods they were separated from their loved ones. When they return, they are faced with the reality of not having an income, having problems of reintegrating into their communities and having severe problems of providing for their families.

The only worrying aspect is the fact that provision for pensions is only made for the one side, and not for the other side who also suffered because they were conscripted or volunteered, and did extensive national service and did not have the opportunity to contribute to a pension fund. The worst hit are the black and coloured soldiers who served in the SA Defence Force. Hopefully, their service will also be recognised in time to come.

The DA supports these two Bills, as they enhance the effectiveness of the Acts that are being amended to the advantage of the veterans. We must never forget our old soldiers and combatants, no matter which side they fought on. Thank you. [Applause.]

Dr G G WOODS: Deputy Chairperson, the IFP supported the Special Pensions Act and the Government Employees Pension Laws when these were introduced in

1. Therefore, we can have no issues or problems with the amendments of these two pieces of legislation that are before us today, in that the amendments are consistent with and, in fact, further the original aims and intentions of the 1996 Acts.

We are, therefore, pleased to support both amendments. Thank you.

The DEPUTY MINISTER OF DEFENCE: Thank you, members. Four minutes go quickly.

Deputy Chairperson and hon members, today marks an important landmark in the evolution of our young democracy. The documents before us that require passage through this House reflect the attainment of yet another chapter in our drive to redress and make restitution for our apartheid legacy. Our first democratic Government decided on the need to rectify unequal labour practices in the public service that we had inherited. This ratification required a number of legislative and other changes that we have witnessed over the years since 1994.

The first major milestone was when we achieved restitution, through the granting of equal pension benefits for all women employed in the Public Service. As hon member Nene has already pointed out, Cabinet set aside a further R1,5 billion to enable progress to be made towards the promotion of equal labour practice for all the citizens of South Africa.

An amount of R140 million was utilised to eradicate discriminatory pension practices for the former general assistants of the Department of Water Affairs. Other joint projects have involved redressing the position with regard to temporary members of the general assistance cadre. Further action is aimed at addressing the needs of dismissed Eastern Cape strikers. Respectively, the amounts in the two categories referred to are R319 million and R129 million.

When we created our new SA National Defence Force which serves us nobly, we established and implemented the constitutional principle of proper recognition of service for all integrating forces.

Today, we speak of our new National defence force with pride, and it is not only us, but also all our partners in South Africa, in Mozambique, in the DRC, in Burundi, in Ethiopia, on the high seas and above in the blue of our skies who do so. We have created this proud achievement through giving full recognition for service in the SADF and for service in the TBVC states. We have also followed a steady programme towards full and equivalent recognition for service in uMkhonto weSizwe and Apla. These Bills allow us to complete a long, long process that has been thoroughly canvassed with all the stakeholders in the House. This lengthy process that has been followed since 1994 has culminated in these law-changing proposals.

Pensions are in recognition of service for soldiers and former soldiers that have served in the military. They should not be regarded as a privilege, but as a right or entitlement. In South Africa, all soldiers who served in the SA Defence Force receive a pension. This pension is calculated and based on the number of years served in the military.

The issue of parity of pensions between the statutory and non-statutory force soldiers is a very important political issue, and it is crucial for the stability of this country that members of the Defence Force, from whatever formations they originated, are treated equally. It should be noted that an estimated 2 000 people covered in these Bills as persons who have served in the non-statutory force are serving other Government departments, including the SA Police Service, National Intelligence Agency, Correctional Services and others.

Once these laws are amended, those who at present receive special pensions benefits and who will qualify for the restructuring of pensions, will have to have their pensions amended, taking into account the amounts that they have received.

The Department of Defence is also considering submissions made to it by parties who state that the special pensions mechanisms have shortcomings. In this regard, those who do not qualify for special pensions benefits, because they were less than thirty-five years old on the qualifying date, need also to be looked at.

The Bill, as amended, ensures that dependants receiving special pensions benefit in their own right, are not penalised. We are also aware of inaccuracies in the existing certified personnel register, the CPR, which serves as the basis of identifying persons to benefit from measures put forward to this House today. At the correct time, the Ministry shall address any shortcomings identified on the CPR and, obviously, correct where necessary.

I’ve alluded to a steady programme, hon member Schalkwyk, that has been followed by the Department of Defence, in ensuring the recognition of service of all integrating forces. Members of the House may not be familiar with the details of this programme.

Using the conditions of recognition of services of the former SADF as a basis, the department went through an intensive programme of ensuring that the former TBVC soldiers were not unfairly discriminated against regarding their pensions. We are pleased to report that the department has a plan for providing post-retirement medical service benefits.

Training programmes have now been standardised with bridging training all but over. The quality of opportunities that the NSF provided for women soldiers is now provided by the department for all Defence Force members, irrespective of their background.

Given this context, we know that it has taken an inordinately long period for us to reach this particular point. A number of heroes of the struggle have passed on without enjoying full and proper pension benefits for the years of service they have given to our nation, without full recognition for the sacrifices and extreme hardships that they endured in conducting the struggle for our freedom.

Some of our elder comrades are experiencing economic hardships as a result of being too old to work. Others who have taken packages have started to lose hope that the country they fought for will recognise their sacrifices and compensate them accordingly. Some of our retired members are seriously ill, while others have died without due compensation.

I wish to repeat here that there are those members of the Rivonia High Command, including the late Comrade Govan Mbeki, Tata Sisulu, Comrade Elias Motswaledi and others, who did not live long enough to see us carry this process through to its required conclusion.

We ask that the dependants of these comrades should understand that our tardiness has largely been as a result of the bureaucratic minefield that we have had to cross. We beg their understanding and tolerance, and we commit ourselves to preventing any further delay in their receiving proper restitution.

The heroes of our struggle, whom we are still lucky to have with us, are scattered throughout our nation. We would like to appeal to the members of this House to assist in providing proper care to these veterans. As we enjoy the fruits of our democracy, let us, in equal measure, show our gratitude and appreciation to those who made this democracy possible by assisting, where possible, in their wellbeing.

Whilst the Military Health Services have a national presence, there are important gaps in our coverage. We’d like to appeal to the Departments of Health and Social Development to assist these comrades in areas we cannot reach. We wish to give our full support to these long-overdue Bills.

Ngesikhathi esekhona lapha uSekekela Mongameli, uMsholozi, bengifisa ukumtshela ngithi, ``Nxamalala, usungalala ubuthongo ngoba lo mthetho uzokwenza ukuthi sikwazi ukukhokhela amadelakufa angoJenene Dlamini, oTekere noMasondo izimpesheni zabo ezibafanele’’. Siyazi ukuthi lapho bekhona baphila impilo enzima ngenxa yokuthi bebelinde ukuthi zikhokhwe lezi zimpesheni zabo.

Siyabonga-ke kwiPhalamende nakuHulumeni ukuthi sesikwazile namhlanje ukuthi siphasise lo mthetho ozokwenza ukuthi lezi zimali zikhokhelwe amadelakufa akithi ayilwela le nkululeko esiyithokozelayo namhlanje. Ngiyabonga. [Ihlombe.] (Translation of Zulu paragraphs follows.)

[Whilst Msholozi, the Deputy President, is still here, I would like to say to him, ``Nxamalala, [clan name for the Zuma surname] you may now enjoy your sleep because this piece of legislation will enable us to pay stalwarts such as General Dlamini, Tekere and Masondo the pensions due to them.’’ We know that where they are life is hard, because they have long been waiting for these pension benefits to be paid out.

We thank Parliament and the Government that today we have managed to pass this Bill which will make possible the payment of our stalwarts who fought for the freedom that we enjoy today. [Applause.]]

Dr W A ODENDAAL: Mr Deputy Chairman, the Government Employees Pension Law Amendment Bill seeks to provide for the recognition of services rendered by members of non-statutory forces or services, and to rule on the financing of this decision.

Die ander wetsontwerp, die Wetsontwerp op Spesiale Pensioene, handel oor ‘n pensioenskema wat daargestel is vir lede van buite die vorige statutêre en nie-statutêre magte. Die agb Adjunkminister van Finansies het gesê daar is lede van sewe magte wat hierby geïnkorporeer word. Die Nuwe NP ondersteun hierdie bepalings. Dit is net reg dat oudsoldate, of hulle nou teen mekaar geveg het of nie, en wat geveg het vir ‘n saak waarin hulle glo, se bydraes tot die vrede wat ons vandag in Suid-Afrika het, erken sal word.

Daar is egter ‘n probleem, en ek wil graag die agb Adjunkminister van Verdediging daarop wys dat daar sekere lede van die Weermag is wat nie deur hierdie wetsontwerp bevoordeel word nie, maar wat eintlik daardeur benadeel word. Dit is die sogenaamde gedemobiliseerde magte wat voor 1994 gedemobiliseer is. Dit is hoofsaaklik magte wat op kontrakbasis in diens geneem is en met ‘n vergoedingspakket gedemobiliseer is. Sommige van hulle was lede van die Suid-Afrikaanse Kaapse Korps, SAKK soos ons hulle geken het, en daar is ook nog ander van hulle. Hierdie lede van vroeëre magte kry geen voordeel uit hierdie pensioenskema nie. Hulle moet tevrede wees met hulle miserabele skeidingspakket wat voor 1994 aan hulle betaal is. Daarmee moet hulle ‘n bestaan voer, terwyl lede van die nie-statutêre magte, dit wil sê van Apla, MK ensovoorts, wat ook voor 1994 gedemobiliseer is, wel die voordele van hierdie pensioen ontvang.

Onses insiens is dit diskriminasie. Ons sal hierna moet kyk. Die agb Minister van Finansies is so gou om daarna te verwys dat hierdie lede waarna ek nou verwys het, nie vryheidsvegters was nie, maar hulle was deel van ‘n oorlog. Hulle was in ‘n oorlog betrokke, en alhoewel hulle aan die ander kant geveg het, is die punt dat die twee magte wat teen mekaar in die oorlog te staan gekom het, besluit het om vrede te maak in Suid-Afrika, en daar sit ons vandag met ‘n demokratiese Suid-Afrika. Ons dink almal moet in hierdie saak bevoordeel word, want hierdie stryders wat misken word was ook stryders wat Sowjet-ekspansionisme teengestaan het. Om watter rede hulle ookal aan die oorlog deelgeneem het, dit maak nie saak nie. Die punt is dat daar nog sekere lede is wat nie geken word in die saak nie.

Die Nuwe NP sal aanhou met onderhandelinge en ander aksies, en sal ook met privaatledewetgewing na die Parlement kom om hierdie onbillike situasie aan te spreek, maar vir vandag steun ons die wetsontwerp wat voor ons is. [Applous.] (Translation of Afrikaans paragraphs follows.)

[The other Bill, the Special Pensions Amendment Bill, deals with a pension scheme that has been established for members from outside of the former statutory and non-statutory forces. The hon Deputy Minister of Finance has said that there are members of seven forces who will be incorporated in this. The New NP supports these provisions. It is only right that ex- soldiers, whether they fought each other or not, and who fought for a cause they believed in, be acknowledged for the contributions they made to the peace that we experience in South Africa today.

However, there is a problem, and I would like to point out to the hon Deputy Minister of Defence that there are certain members of the Defence Force who do not benefit from this Bill, but who are actually being prejudiced by it. These are the so-called demobilised forces that were demobilised before 1994. They are mainly forces who were employed on a contract basis and were demobilised with a compensatory package. Some of them were members of the South African Coloured Corps, SACC as we knew them, and there were others as well.

These members of former forces do not stand to gain from this pension scheme. They have to be satisfied with their miserable severance packages which were paid to them before 1994. They have to make a living with that, while members of non-statutory forces, in other words Apla, MK, etc, who were also demobilised before 1994, will be receiving the benefits of this pension.

To our mind that is discrimination. We will have to look at this. The hon Minister of Finance is quick to say that these members to whom I have just referred were not freedom fighters, but they were part of a war. They were involved in a war, and although they fought on the other side, the point is that the two forces opposed in war decided to make peace in South Africa, and so we have a democratic South Africa today. We believe that everyone should benefit in this matter, because these fighting men who are being disregarded were fighters against Soviet expansionism. Whatever the reason they participated in the war, it does not matter. The point is that there are still some members who have not been consulted in the process.

The New NP will continue with negotiations and other actions, and will also bring private members’ legislation to Parliament in order to address this unfair situation, but for today we support the Bill in front of us. [Applause.]]

Mnr A BLAAS: Voorsitter, die oogmerke van hierdie wysigings is duidelik. Die wysigings was noodsaaklik sodat die Suid-Afrikaanse Nasionale Weermag met sy rasionaliseringsprogram kan voortgaan. Van die belangrikste redes hiervoor is: Eerstens, die personeeluitgawes van die Weermag is buite verhouding hoog. Tweedens, die Weermag is reeds onderbefonds. Derdens, die ouderdom vir rangverhouding in die Weermag is nie reg nie. Vierdens, die lede voldoen nie aan die nodige fiksheidvereistes om hulle take effektief uit te voer nie. En laastens, lede van die statutêre magte het nie die geleentheid gehad om tot ‘n pensioenfonds by te dra nie.

Die wysigings aan beide die wette maak dit moontlik om ‘n redelike uittreemeganisme vir Weermagslede daar te stel, sodat daar met die rasionaliseringsprogram van die Weermag voortgegaan kan word. Beide hierdie wysigings word deur die ACDP ondersteun. Ek dink ook dat daar in ‘n stadium net gekyk moet word na die klein komponent van Weermagslede wat nog nie in aanmerking kom vir pensioen nie. Dankie. [Applous.] (Translation of Afrikaans speech follows.)

[Mr A BLAAS: Chairman, the objectives of these amendments are clear. The amendments were necessary so that the South Afican National Defence Force can continue with its rationalisation programme.

Some of the most important reasons for this were: Firstly, the staff expenses of the Defence Force are disproportionately high. Secondly, the Defence Force is already underfunded. Thirdly, the age-to-rank relation in the Defence Force is not right. Fourthly, the members do not comply with the necessary fitness requirements to execute their tasks effectively. And lastly, members of the statutory forces did not have the opportunity to contribute to a pension fund.

The amendments to both these acts allow for the implementation of a fair retiring mechanism for Defence Force members, so that the rationalisation programme of the Defence Force can continue. Both these amendments are supported by the ACDP. I think that at some stage, the small component of Defence Force members who, as yet, do not qualify for a pension, must be looked at. [Applause.]]

Dr M S MOGOBA: Chairperson, the Pan Africanist Congress of Azania supports this Bill.

We record our appreciation for what this Government has done to respond to the plight of many freedom fighters who served this country under conditions that were very difficult, and even inhuman, in an attempt to bring about democracy which will be enjoyed by all South Africans, irrespective of their colour or creed.

Unfortunately, as one form of disparity is addressed, it sheds light on many small pockets of discrimination in the integration process. If service in the non-statutory forces is accepted by the country and Government, then pensions received by persons who served in these non-statutory forces should be accordingly adjusted to bring parity in pensions paid. We are one country with one Defence Force and, therefore, the benefits we offer should reflect that oneness.

There are, however, many desperate cases which reach our offices of people who have been left out for one reason or another. We hope we can reach them one day. Thank you.

Miss S RAJBALLY: Deputy Chair, regarding the integration of military forces into the SA National Defence Force, the MF found it acceptable that payment of pensions be made to those in the service who had honourably made sacrifices in the public interest.

However, noting that provision does not exist regarding these members who served in non-statutory forces prior to integration and who were unable to contribute to a pension fund, the MF feels that they are entitled to such special pension and therefore has no objection to this Bill which makes provision to allow for this process.

Provisions made in terms of pensions of the Government Employees Pension Fund are adequate. Further, the clarity provided in the light of rights of a dependent of a former recipient of such pension is in line too.

The terms provided for financing and management of resolution of issues are supported by the MF. It is hoped that these adjustments will be pleasing to those involved.

The MF feels that the Government’s hard work in correcting the injustices of the past has proven to be a success. Our most important task as a Government is to our people. The MF supports both the Bills. Thank you.

The DEPUTY MINISTER OF FINANCE: Deputy Chair, hon members, I would like to thank all members who have participated in this debate. Quite clearly, the legislation is widely supported by members.

The hon Schalkwyk raised a particular issue that relates to a contingent of soldiers who served in the previous dispensation. I have had occasion before to say to the hon Schalkwyk that the process we are dealing with is, to us, a separate process from the issues that he has been raising consistently. I have advised that he seek the proper channels to raise that particular issue. I want to repeat today that it is important for the hon member to find the correct channels.

If I heard the Deputy Minister of Defence correctly when she was speaking here, she did identify some of the weaknesses that still exist which the SA National Defence Force is in the process of dealing with. So, I think that it is important for members to try to link up to those processes.

I think it is also important to point out to the hon Odendaal - although I was battling with the hearing device when he was speaking - that before we rush into saying that this is discrimination, it is important to understand what this process has been all about.

This has been a process in which the former statutory forces and the former non-statutory forces came together to create a defence force out of a number of forces that were there. Of course, what the non-statutory forces will bring to the table will be those matters that affect members of the former non-statutory forces. You then expect that the other forces will also bring to the table matters that may affect former members of the statutory forces.

I do not know if that has happened, but in our case we have put this matter consistently. It has taken us time to get to the point at which we are today, and at which we are able, through this legislation, to redress an imbalance that has been in the system. So, don’t lose hope, don’t lose patience, find the correct channels, raise the issues and see if we can deal with them.

The hon Mogoba also raised the issue of people who may have been left out, but was not very specific as to how people got left out. Because the Deputy Minister of Defence did say, for example, that there are deficiencies on the CPR list, I would think that perhaps some of those people may have been left out precisely because they did not make it onto the CPR list. Again, I think this is a matter that needs to be taken up with the Ministry of Defence and with the SA National Defence Force so that we can deal with those particular cases. I would like to thank members for their support and participation in the debate. Thank you very much. [Applause.]

Debate concluded.

Special Pensions Amendment Bill read a second time.

Government Employees Pension Law Amendment Bill read a second time.

                   POSTAL SERVICES AMENDMENT BILL

                       (Second Reading debate)

The MINISTER OF COMMUNICATIONS: Hon Chairperson, members, we are presenting this Bill today just a few weeks before World Postal Day, which is celebrated each year on 9 October. This international event marks the anniversary of the formation of the Universal Postal Union in 1894 in the Swiss capital of Bern. On this day, the world community assesses the new conditions under which postal services are delivered to meet the universal access mandate. As part of this world community, we should gear ourselves to make a mark by doing what is relevant to our own local conditions in meeting this mandate.

In our country where millions of our people, especially the historically disadvantaged, still depend on the postal service to interact and communicate, the centrality of SAPO cannot be underestimated or undermined. Thus the challenge the postal administration faces becomes a real national issue and requires that it be treated as such.

In line with the Universal Postal Union’s theme for this year’s anniversary celebration, which is ``think globally and act locally’’, we have to approach the postal services sector accordingly. Our local conditions dictate that we pursue the fulfilment of the universal service mandate, though international trends may indicate otherwise. For us as South Africans, this is an overriding imperative.

It was against this backdrop that, as early as 1997, a new policy process was initiated for the provision of a universal service. This policy found concrete expression in the Postal Services Act, Act 124 of 1998. The legislative framework has made it possible for the South African Post Office to increase its service levels and to embrace technology in a way that delivers services. Crime levels at SAPO have been reduced, which has resulted in higher staff morale.

The Rural Postal Strategy is now being implemented through the citizens’ post offices, providing postal infrastructure to multipurpose community centres in partnership with the GCIS. Co-operative business services are slowly increasing, and we are working with the Direct Marketing Association, which is now the Marketing Federation of South Africa, and the National Postal Forum in discussing future postal strategies that will improve efficiencies of business. Consequently, the regulator has developed and is continuing to develop regulations and a monitoring framework for service delivery. This Bill will not only encourage competition in the postal sector, but will actually clarify the regulatory framework for the delivery of universal service. Government would like to fulfil the universal service obligations, while at the same time encouraging competition in this industry. It is through competition that we will lower prices and improve service delivery levels. Therefore, this Bill will also clarify the competition landscape for the sector and will provide continuity in the sector, as well as allow for all operators to focus on harmonious business in this industry.

In line with this policy of fulfilling the universal service mandate, the licence that was granted with a clear obligation was to ensure all citizens of our country have access to a basic letter service. This service should be reasonably accessible irrespective of physical location. It should apply uniform postage rates at an affordable price and should also offer a reliable service. To facilitate an environment for SAPO to accomplish this monumental task, the institution was given a period of exclusivity to provide service up to 1kg. This provision is renewable every three years and, during this period of exclusivity, no other postal operator will be authorised to operate in the reserved area.

If SAPO is to meet its obligation to the benefit of millions of our people, this exclusivity has currently to be retained. This is because we do things globally and act locally, till conditions change or universal access is achieved. The introduction of this Bill is aimed at doing exactly that. The repeal of the said section will protect the exclusivity in respect of the reserved postal services, but will also eliminate the multiplicity of interpretations emanating from this section.

I would like to thank the Chairperson of the Portfolio Committee on Communications and all members of the committee for having processed this Bill. A special word of thanks goes to my director-general and the DDG for co-ordinating the process successfully. I request this House to accept this Bill. [Applause.] Mr M A MAZIYA: Deputy Chair, hon Minister and hon members, I am happy to be one of the members who are participating in this debate. Minister, the Bill comes in to close the loopholes in the Act, to ensure that the Post Office, in implementing universal services, does not get involved in unnecessary court battles. The law also assists in ensuring that those who want to participate as postal service providers should get involved in other fields of postal services.

Minister, this is an indication of the ANC’s commitment to ensuring a better life for all as enshrined in the Freedom Charter. We do not apologise for this position of a better life for all.

It is our view in the ANC that this privilege will help the Post Office in pursuing this interest.

Malungu ahloniphekile, iyamangalisa impela indlela amanye amaqembu akhohlisa ngayo abantu. Uma engaphandle kwaleli Phalamende, azenza abantu abanozwelo, kodwa uma elapha ePhalamende aphikisana nayo yonke imiThetho okuqondwe ngayo ukwenza ngcono impilo yabo bonke abantu. Emavikini amabili edlule babevakashele elinye lamalokishi lapho bazibophezela khona ukuthi bazolwela ukugunyazwa kwabantu abamnyama. Kodwa, emuva kwezinsuku nje ezimbili sekudingidwa isichibiyelo somThetho omayelana nokugunyazwa kwabamnyama kwezomnotho, lona lelo qembu laphikisana nalesi sichibiyelo laze lathi makuvotwe.

Namhlanje ngeke kusimangaze uma bengaphika bathi akuvotwe ngoba vele abahambisani nemithetho okuqondwe ngayo ukulungisa ngokushesha indlela esinikezwa ngayo izinsiza. Abantu abakhe emaphandleni bayoyithola kanzima imali ethunyelwa kubo uma indlela yokuhambiswa kwamaposi ihamba kancane, ngoba kungekho indlela iposihhovisi elikwazi ngayo ukuthi lenze imali ukuhambisa leyo misebenzi.

Kungumbono wethu ukuthi uHulumeni oholwa uKhongolose uzinikele ngempela ekwenzeni ngcono impilo yabo bonke abantu, ukuthi lo mThetho uqhutshekiswe uye phambili. Kungakho-ke sisisekela lesi sichibiyelo. (Translation of Zulu paragraphs follows.)

[Hon members, it is amazing how some parties deceive people. Outside this Parliament they pretend to be caring, but when they are here they oppose all the laws meant to improve the lives of all the people.

Two weeks ago they visited one township where they committed themselves to fighting for the empowerment of black people. However, only two days thereafter the amendment to the Act regarding the empowerment of black people is made, and the same party opposes it to the extent that they demand voting.

Even today we will not be surprised if they demand voting again because, naturally, they do not approve of any laws which target speedy improvements to our service delivery. People in rural areas will have difficulty in receiving money sent to them if postal services are slow and if the Post Office has no way of gaining funds to operate those services.

Our suggestion is that the ANC-led Government dedicate itself to improving life for all so that this law can be processed. That is why we support this amendment. ]

We say to those who oppose that we know this is their attitude to all the laws that come before this House, and to the laws that are aimed at improving the lives of our people and at ensuring that there is normality and balance in the way we live. Amandla! [Applause.]

Mr V C GORE: Hon Deputy Chair, the Postal Services Amendment Bill does nothing more than entrench the monopoly of the Post Office to the detriment of the courier companies. What this sector needs is competition, not more protection.

When the underlying Act was passed in 1998, the Minister of Communications stated, ``Competition should be encouraged by the Government.’’ Instead of taking this sector forward along the stated path of competition, this Bill seeks to take us back a number of steps.

What the department and the ANC would like us to believe is that, in order to bring the Postal Services Act in line with the Appeal Court decision earlier this year, and to ensure universal access to postal services, courier companies must be excluded entirely from operating in the reserved area of less than 1kg. The ANC’s argument is flawed on two accounts.

Firstly, the minority judgments in the Appeal Court pronounced that:

… the legislature recognised that couriers were illegally performing reserved postal services and intended to allow them to do so legally in the future, providing certain undertakings were given.

In other words, the minority judgments in the Appeal Court held that the legislation did intend to preserve a monopoly, albeit while permitting courier services within the activities of reserved postal services.

Therefore the underlying problem was the interpretation of the Act. All that was needed was to amend the Act. What has, in fact, happened is that the department is using this interpretation to change the law to entrench the monopoly. If the Act is not clear, then make it clear. Do not change it, its intent or its meaning.

This course of action of making law clearer has precedent in this House. Parliament is about to do the same thing with the Prevention of Illegal Eviction from and Unlawful Occupation of Land Act after the same Appeal Court interpreted it to mean that landlords cannot evict tenants, whereas the Act deals with squatters and the legislature did not intend it to apply to tenants.

The ANC’s second flawed argument is that they have failed to explain that the business of the Post Office and that of the courier companies are entirely different in the reserved area. The Post Office offers a very necessary and basic service, while courier companies offer a value-added service. By way of example, the Post Office sells potatoes to the end user, while the courier companies add value to the potatoes and sell them to the end user as potato salad or chips.

Not only will this Bill have a material effect on the future existence of these companies, but it will also deny the consumer’s right to basic choice. This travesty of justice is further exacerbated when one considers that the Bill allows the Post Office to subcontract these services to wholly owned subsidiaries of the Post Office without a licence. One cannot but think that this is yet another ANC vehicle for cronyism and jobs for pals.

In conclusion, the DA cannot support this Bill. We believe that competition is the best mechanism to offer choice, the best choice to offer lower prices and the best mechanism to provide universal service. The DA further believes that in order to rescue the floundering Post Office and provide some form of stability to this industry, it is high time for a postal colloquium, in a similar vein to the convergence colloquium held recently after unrelenting pressure from the DA.

At the very least, we expect the ANC to make good on the promise made by the Minister of Communications in 1998, when the Minister stated that the monopoly of the Post Office should be reviewed after three years. We are still waiting, two years later. Thank you. [Applause.]

Ms S C VOS: Deputy Chairperson, today the DA express, to a large degree, the policy position of the IFP, and that is support for free enterprise and the view that Government should not compete with the private sector in spheres of delivery which, inevitably, can be performed better and cheaper by businesses owned and controlled by a variety of investors.

However, our sympathy for this ideological view is tempered by our sympathy too for the plight of the Post Office and its need to build capacity and to roll out services to many millions of our citizens who, for instance, currently do not have postal addresses or convenient access to postal services.

We will therefore support this amendment in the hope that by enabling the Post Office to strengthen its position and its so-called ``reserved areas of service’’, the Post Office will sooner, rather than later, cease to operate in a monopolistic manner; that it will have eradicated a huge debt; that it will no longer be dependent on Government transfers for its survival; that the postal needs of our citizens will have been addressed and, finally, thereafter, that competition will flourish in the postal sector. Thank you. [Applause.]

Mev ANNA VAN WYK: Mnr die Voorsitter, myns insiens is die debat oor hierdie wetgewing streng gesproke nie werklik nodig nie, en ek beoog nie om die agb Raad en Minister se tyd met ‘n paar steriele argumente te mors nie. Ek sou baie eerder met die Raad en die agb Minister wou praat oor die skokkende inligting wat ons vanoggend gekry het dat Engels 91,1% van die TV-inhoud uitmaak, en Afrikaans slegs 5% - om nie te praat van die slegs 1% Zoeloe en die ander inheemse tale met nog kleiner persentasies nie. Dit is totaal onaanvaarbaar. Net so onaanvaarbaar, byvoorbeeld, is die feit dat 93% van die films Amerikaans is, en net 3% plaaslik en 4% van elders.

Maar nou ja, ons praat oor ‘n ander debat en teen die tyd dat die Nuwe NP aan die beurt kom, is die tegniese aspekte van wetsontwerpe reeds afgehandel, en as ek so rondkyk, is dit duidelik dat dit eintlik net pligsbesef is wat ‘n paar verdwaalde siele miskien so ‘n bietjie lusteloos in hul sitplekke hou. En dink net aan die arme publiek!

Voorts voel ek dit is die SA Poskantoor se plig om sy bedryfsverliese te verminder, en hoewel daar goeie vordering daarmee gemaak word, bly dit steeds ‘n groot uitdaging. Nie alleen sal hierdie wysigings hopelik tot beter diens lei nie, maar ook ‘n paar stuiwers inbring. Die Nuwe NP steun die wetgewing. [Tussenwerpsels.] (Translation of Afrikaans speech follows.) [Mrs ANNA VAN WYK: Mr Chairman, in my opinion the debate on this legislation is, strictly speaking, not really necessary, and I do not intend to waste the time of the hon House and Minister with a few sterile arguments. I would far rather speak to the House and the hon Minister about the shocking information we received this morning that English constitutes 91,1% of television content, and Afrikaans only 5% - not to mention the mere 1% of Zulu and the other indigenous languages with even smaller percentages. This is totally unacceptable. Equally unacceptable, for example, is the fact that 93% of the films are American and only 3% are local and 4% from elsewhere.

Be that as it may, we are discussing a different debate and by the time the New NP has their turn, the technical aspects of Bills have already been dealt with, and if I look around, it is clear that it is actually only a sense of duty which perhaps keeps a few lost souls somewhat listlessly in their seats. Think of the poor public!

Furthermore, I feel it is the duty of the SA Post Office to reduce its operating losses and although good progress is being made in this regard, it remains a big challenge. These amendments will hopefully not only lead to better service, but also bring in a few pennies. The New NP supports the legislation. [Interjections.]]

Miss S RAJBALLY: Deputy Chair, the MF has been pleased with the metamorphosis undergone by the Post Office nationally, resulting in great improvement and efficiency in its services. The MF feels confident that the Post Office within South Africa shall do us proud on delivery.

In the light of the provisions of the amending Bill, the MF has no objection to protecting the South African Post Office’s exclusive function to provide reserved postal services. The specification of a timeframe by the hon Minister is also supported. Further, the licensing of courier companies to provide unreserved services is acceptable.

The MF proudly wishes the South African Post Office well in its endeavours to provide services to the South Africa citizenry. The MF mentions its satisfaction with the provisions in clause 2 regarding courier services and supports the Bill.

Mr M K LEKGORO: Chairperson, post is a basic need in society. Through post, citizens are able to communicate. They are enabled to enter into different transactions. They are able to receive account statements from any institution they do business with. They are able to correspond with different government institutions in addressing their rights and demands. In a big way post makes citizens from all walks of life active participants in both the country’s political and economic life.

The Postal Services Act imposes a universal service obligation on the Post Office in terms of what the Act refers to as reserved services. Reserved services cover those letters and articles that are no more than 1 kg in weight and restricted to a particular length, width and thickness. The actual intention is that a letter or article of that size and weight should be posted or received by all South Africans at a stipulated low and affordable price, irrespective of whether that profits the Post Office.

Because business is profit driven, it clearly will only be willing to convey such postal items in those populated urban centres where the returns will be profitable. True to the tradition of business, they will argue to distribute to where it makes business sense, while leaving the Post Office to distribute to the far-flung areas at a loss. No one can stand here and argue that there would be competition in such a situation. Clearly, the playing fields in such a scenario are not level.

Imposing a universal service obligation on any profit-driven venture will limit its ability to operate, if not grind its business to a halt. To offer an unfettered licence to profit-driven ventures is to undermine the intended universal service obligation we wish to impose on the Post Office. Cognisant of this reality, the Act gives the Post Office the exclusive right to provide a service in posting a letter and article of the size and weight we described above.

The impression should not be created that reserved services constitute the whole of what postal service is about. It constitutes a lower percentage of total postal business while the rest of the percentage or greater area of business is open to competition. Let us put it on record that giving the Post Office an exclusive right for reserved services is a practice known throughout the democratic world. In fact, advanced democracies like Belgium, France and Greece limit reserved services to 2 kg, which is twice as high compared to the South African situation.

We should also mention that the amendment before us today does not bring anything new, other than to confirm the original intention of the Act and establish certainty after a court challenge on this matter. The intention of the principal Act and the reason behind the amendment is to enable the Post Office to deliver basic postal services to all South Africans, be they rich or poor, in urban or rural areas, white or black.

An objection to the Bill, although shrouded in concepts of freedom to compete, is an objection to deliver to those areas of our society that matter. This is basically an objection to deliver to the poor, an objection to deliver to the far-flung rural areas, an objection to deliver to black people in general. [Interjections.]

Driven by our desire to be counted on the side of goodwill, we accordingly support the Bill. [Applause.]

The MINISTER OF COMMUNICATIONS: Hon Chairperson, I’d like to thank the members who have indeed supported this Bill, because this Bill is not intended to do the kinds of things that we have heard from the DA here. The DA says we want to entrench monopoly. It is quite clear that we actually do want to move towards competition, and that is why we said that we have to have a review after three years. The DA also said that they put pressure on us to have a colloquium, as in the convergence colloquium. I hope that they are not suffering from some kind of delusion, because the colloquiums we held, we held in terms of e- commerce when we did the ICT sector, because it has been the tradition of this ANC and this Government to consult. The fact that we held the convergence colloquium is part of that tradition. I think you must be suffering delusions of grandeur on that score.

We also heard that this was in order to make allowance for cronyism in the ANC. If anything indicates cronyism, which we are suffering from today, it is indeed the result of the previous government’s cronyism in the Post Office that has resulted in where we are today. [Interjections.] This is the mess that the ANC Government and I have had to clear up. That has nothing to do with ANC cronyism. [Interjections.] We brought on board a partner to help us out of the problem, but once we realised that that was not going to happen, we decided to cancel the contract and said that we would do it ourselves, and you have seen the turnaround in the Post Office of doing it ourselves. [Interjections.]

We all know that the private sector does not always work perfectly. [Interjections.]

The DEPUTY CHAIRPERSON OF COMMITTEES: Order! Order, hon members, you may interject but, please, you may not howl and you may not disturb the speaker from the floor. Continue, hon Minister.

The MINISTER OF COMMUNICATIONS: What we would like to say is that this has not been an easy way of going about doing our Government work, as we could have gone into competition much earlier. We have had support from people, for example the IFP, who say that this is the direction that they want to go in, but also recognise the problems on the other side. They therefore support that Bill, because they, as South African citizens, are cognisant of the challenges that are facing the Post Office and to which the Post Office has risen.

I thank all those members who are part of this group of South Africans who want to see the Post Office go forward. I thank you. [Applause.]

Debate concluded.

Bill read a second time (Democratic Alliance dissenting).

The House adjourned at 18:06. ____

            ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS

ANNOUNCEMENTS:

National Assembly and National Council of Provinces:

1. Introduction of Bills:

 (1)    The Minister of Finance:


     (i)      Pensions  Second  (Supplementary)  Bill  [B  59  -   2003]
          (National Assembly - sec 77).


     Introduction and referral to the Portfolio Committee on Finance  of
     the National Assembly, as well as referral  to  the  Joint  Tagging
     Mechanism (JTM) for classification in terms of Joint Rule  160,  on
     11 September 2003.


     In terms of Joint Rule 154, written views on the classification  of
     the Bills may be submitted to the  Joint  Tagging  Mechanism  (JTM)
     within three parliamentary working days.

COMMITTEE REPORTS:

National Assembly:

1. Report of the Portfolio Committee on Education on the Higher Education Amendment Bill [B 36 - 2003] (National Assembly - sec 75), dated 9 September 2003:

   The Portfolio Committee on Education, having considered the subject of the Higher Education Amendment Bill [B 36 - 2003] (National Assembly - sec 75), referred to it and classified by the Joint Tagging Mechanism as a section 75 Bill, reports the Bill without amendment.

2. Report of the Portfolio Committee on Education on the Education Laws Amendment Bill [B 38 - 2003] (National Assembly - sec 76), dated 9 September 2003:

   The Portfolio Committee on Education, having considered the subject of the Education Laws Amendment Bill [B 38 - 2003] (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 38A - 2003].

3. Report of the Portfolio Committee on Agriculture and Land Affairs on the Restitution of Land Rights Amendment Bill [B 42 - 2003] (National Assembly - sec 75), dated 9 September 2003:

   The Portfolio Committee on Agriculture and Land Affairs, having considered the subject of the Restitution of Land Rights Amendment Bill [B 42 - 2003] (National Assembly - sec 75), referred to it and classified by the Joint Tagging Mechanism as a section 75 Bill, reports the Bill with amendments [B 42A - 2003].

4. Report of the Portfolio Committee on Agriculture and Land Affairs on the Spatial Data Infrastructure Bill [B 44 - 2003] (National Assembly - sec 75), dated 9 September 2003:

   The Portfolio Committee on Agriculture and Land Affairs, having considered the subject of the Spatial Data Infrastructure Bill [B 44 - 2003] (National Assembly - sec 75), referred to it and classified by the Joint Tagging Mechanism as a section 75 Bill, reports the Bill with amendments [B 44A - 2003].

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