National Council of Provinces - 20 November 2003
THURSDAY, 20 NOVEMBER 2003 __
PROCEEDINGS OF THE NATIONAL COUNCIL OF PROVINCES
____
The Council met at 14:04.
The Deputy Chairperson took the Chair and requested members to observe a moment of silence for prayers or meditation.
ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS - see col 000.
ALIVE CAMPAIGN AGAINST CRIME
(Draft Resolution)
Dr E A CONROY: Chairperson, I move without notice:
That the Council -
(1) takes note of the fact that the Minister for Safety and Security, the hon Charles Nqakula, and the New NP have pledged their support for Ms Lynne Vince-Jillings and her campaign against crime, saying that they would endorse any initiative taken by any sector of the population in campaigns such as the ALIVE campaign to mobilise people against crime;
(2) further notes that the campaign, which is being led by Ms Vince- Jillings whose son was killed in a hijacking earlier this year, includes a march against crime planned for 30 November 2003; and
(3) given the fact that crime cuts across all communities and political parties, expresses its support for the call made by the hon Minister and the New NP on all political formations, other groups and individuals to join in the march and to unite as a nation against crime.
Motion agreed to in accordance with section 65 of the Constitution.
PRESIDENT'S STATE VISIT TO FRANCE
(Draft Resolution)
Mr M A SULLIMAN: Deputy Chair, I move without notice:
That the Council -
(1) notes that South African President Thabo Mbeki on Wednesday, 19 November 2003, concluded a successful three-day state visit to France;
(2) further notes that this visit reinforced the close political and economic ties between France and South Africa;
(3) acknowledges the importance of developed countries such as France in contributing to our efforts as Africans to lead our continent down the path to economic prosperity; and
(4) commends our President for the key role that he plays in Africa’s development through Nepad.
Motion agreed to in accordance with section 65 of the Constitution.
CONCERN ABOUT GENETICALLY MODIFIED FOOD
(Draft Resolution)
Mr K D S DURR: Mr Chairman, I move without notice that:
The Council -
(1) notes that -
(a) genetically modified organisms (GMOs) can be defined as
organisms in which the genetic material (DNA) has been altered
in a way that does not occur naturally by mating or by natural
recombination, and that it allows selected individual genes to
be transferred from one organism to another, also between
nonrelated species;
(b) in response to the many actual and potential dangers posed by GM
foods, a question (Question No 163) was put by Mr K D S Durr to
the Minister of Health, the reply of which indicated that final
draft regulations governing the Labelling of Foodstuffs Obtained
Through Certain Technologies of Genetic Modification are
currently with the Department of Health's legal unit and are
being compiled for publication; and
(c) that the Minister also indicated that no specific handling or
storage requirements for GM foods are to be prescribed in South
Africa, but rather that persons wishing to claim certain
foodstuffs are not genetically modified will need to demonstrate
identity preservation throughout the whole food chain
themselves;
(3) believes that placing the onus upon natural food suppliers to prove the uncontaminated status of their food is a diabolical convolution of reality, and that the onus should be on GM foods producers not to contaminate natural non-GM foods in the growing and handling phases and to label them accordingly;
(4) is of the view that it is not right that the public, some 92% of whom do not wish to eat GM foods, will effectively have to pay a premium to do so;
(5) calls upon the Government to think very hard before inflicting this potential blight upon South Africa and to review its suggested regime for handling, storing and labelling of GM foods; and (6) urges the Government to look at EU traceability requirements for handling GM foods, and not to US food imperialists who wish to bring food dependence to Africa that threatens our biodiversity.
The DEPUTY CHAIRPERSON OF THE NCOP (Mr M J Mahlangu): Is there an objection? Is that an objection? [Interjections.] In the light of the objection, the motion may not proceed and therefore becomes notice of a motion.
SPEAKER AWARDED COUNCIL OF EUROPE DEMOCRACY PRIZE
(Draft Resolution)
Ms R P MASHANGOANE: Chairperson, I move without notice:
That the Council -
(1) notes with pride that the Speaker of the National Assembly, Frene Ginwala, has been awarded the North-South Prize of the Council of Europe for 2003;
(2) further notes that this award is in recognition of the leading role she is playing in promoting parliamentary democracy in Africa and her unselfish commitment to human rights; and
(3) commends the Speaker on her outstanding achievement.
Motion agreed to in accordance with section 65 of the Constitution.
ANTIRETROVIRAL DRUGS NOW AVAILABLE TO ALL WHO NEED IT
(Draft Resolution)
Dr P J C NEL: Mr Chair, I move without notice:
That the Council -
(1) notes that the New NP -
(a) wishes to congratulate the Cabinet on the long-awaited decision
to approve a National HIV/Aids treatment plan that will
eventually make antiretroviral drugs available to all who need
it; and
(b) as one of the campaigners for this since 1998, welcomes this
decision as a major turning point in the fight against Aids;
(2) is of the view that the implementation of this plan will also serve as a key building block in the delivery of health services as a whole in South Africa;
(3) believes that what we now need is a common effort and a collective will to tackle the enormous challenges that will have to be faced in future to beat Aids;
(4) extends its sincere thanks to all concerned for the tremendous effort they have put into this plan and congratulates them on what they have achieved.
Motion agreed to in accordance with section 65 of the Constitution.
CONGRATULATIONS TO DEPARTMENTS ON SUPPORT OF POOR STUDENTS
(Draft Resolution)
Kgoshi M L MOKOENA: Chairperson, I move without notice:
That the Council -
(1) congratulates the Departments of Health and of Social Development in Limpopo for identifying about 250 students from poor families who receive food parcels;
(2) notes that those students are now being trained as nurses - even though that won’t be enough, there will at least be someone from those families who will be earning a salary;
(3) calls upon other provinces to follow suit; and
(4) congratulates the MEC for Health, Mr Sello Moloto, for coming up with such progressive initiatives.
Motion agreed to in accordance with section 65 of the Constitution.
ALLEGATIONS AGAINST DEPUTY PRESIDENT DISMISSED BY ETHICS COMMITTEE
(Draft Resolution)
Mr B J MKALIPHI: Hon Deputy Chairperson, I hereby move without notice:
That the Council -
(1) notes that Parliament’s Joint Committee on Ethics and Members’ Interests on Wednesday, 19 November 2003, dismissed allegations that Deputy President Jacob Zuma breached the institution’s code of conduct for MPs by not declaring benefits;
(2) acknowledges that the investigation process was an open and transparent process within which all political parties, including the DP, participated;
(3) expresses its disappointment, therefore, at the refusal of the DP to accept the outcome of this process; and
(4) commends Parliament and the ANC for their commitment to promote open, accountable and transparent governance.
[Applause.]
The DEPUTY CHAIRPERSON OF THE NCOP (Mr M J Mahlangu): Is there an objection? [Interjections.] In the light of the objection the motion may not be proceeded with and becomes notice of a motion.
RESEARCH BY HUMAN SCIENCES RESEARCH COUNCIL
(Draft Resolution)
Ms D M RAMODIBE: Deputy Chair, I move without notice:
That the Council -
(1) notes the results of a recent survey by the Human Sciences Research Council in its SA Social Attitudes Survey, which predicts that the ANC will win a two-thirds majority in next year’s general elections and in the process increase its seats in Parliament from the current 266 members to 271 in 2004;
(2) is of the opinion that this prediction is an affirmation of the correctness of the ANC’s policies and programmes in transforming our country in accordance with the expectations of the majority of South Africans;
(3) further believes that the increased majority signifies a stamp of approval for the Ten Year Review and a mandate to continue with its programme to alleviate poverty and create access to opportunities for all South Africans.
The DEPUTY CHAIRPERSON OF THE NCOP (Mr M J Mahlangu): Is there any objection to the motion? [Interjections.] There is an objection. In the light of the objection, the motion may not be proceeded with and becomes a notice of motion.
EASTERN CAPE GREEN FLAG ACHIEVEMENT IN ENVIRONMENTAL PROJECTS
(Draft Resolution)
Mnr A E VAN NIEKERK: Mnr die Voorsitter, ek stel sonder kennisgewing voor:
Dat die Raad -
(1) beïndruk is deur en trots is op die Oos-Kaap en die 14 Oos-Kaapse skole wat groen vlae en sertifikate ontvang het vir hul omgewingsprojekte die afgelope ses maande;
(2) kennis neem dat dié skole, deel van ‘n groep van 30 in ander Suid- Afrikaanse streke, die eerste in Afrika is wat dié toekennings ontvang;
(3) verder kennis neem dat dit ‘n internasionale projek is waaraan 1 000 skole in 27 lande wêreldwyd deelgeneem het; en
(4) die skole gelukwens en die hoop uitspreek dat hulle voorbeeld deur ander provinsies en skole gevolg sal word. (Translation of Afrikaans draft resolution follows.)
[Mr A E VAN NIEKERK: Mr Chairman, I move without notice: That the Council -
(1) is impressed with and proud of the Eastern Cape and the 14 Eastern Cape schools that received green flags and certificates for their environmental projects over the past six months;
(2) notes that these schools, part of a group of 30 in other South African regions, are the first in Africa to have received these awards;
(3) further notes that it is an international project in which 1 000 schools in 27 countries across the world participated; and
(4) congratulates the schools and hopes that their example will be followed by other provinces and schools.]
Motion agreed to in accordance with section 65 of the Constitution.
LOCAL GOVERNMENT CONTRIBUTION TO IMPROVING QUALITY OF LIFE
(Draft Resolution)
Mrs E N LUBIDLA: Deputy Chair, I move without notice:
That the Council -
(1) notes that the new framework for a developmental local government provides substantial opportunities to address the challenges associated with poverty eradication;
(2) acknowledges the positive contribution that has been made by local government to focus their efforts and resources on improving the quality of life of their communities, particularly the disadvantaged sectors, through the adoption and implementation of integrated development plans and local economic development initiatives; (3) commends the Minister and Deputy Minister for Provincial and Local Government and the department for programmes such as the Consolidated Municipal Infrastructure Programme and the Municipal Systems Improvement Programme aimed at supporting local government as the lead agencies in our battle to confront poverty and underdevelopment.
Motion agreed to in accordance with section 65 of the Constitution.
Ms N C NKONDLO: Chairperson, because a motion very similar to mine was tabled today, I shall withdraw mine. Thank you.
PROJECTIONS FOR ELECTIONS
(Draft Resolution)
Mr P A MATTHEE: Chair, I move without notice:
That the Council - (1) notes the result of the recent extensive nationwide study done by the Human Sciences Research Council into the 2004 parliamentary elections, announced yesterday;
(2) further notes that according to projections contained in the study -
(a) the ANC will secure over a two-thirds majority, which makes
absolute nonsense of the DA's claim of being an alternative
government, even with the support of the IFP, and shows the
absolute futility of their confrontational style of politics;
(b) the New NP is the third biggest, and also the fastest growing
political party as it would pick up seven seats in the National
Assembly, taking it from 28 seats in 1999 to 35 in 2004,
compared to the second-fastest growing party, the ANC, which
would gain five seats, taking it from 266 seats in 1999 to 271
in 2004;
(c) the New NP is the most representative political party of the
larger parties with 42% of its support coming from the coloured
community;
(d) the New NP and the ANC will retain control of the Western Cape,
the prediction being that the New NP will be the biggest party
in the Western Cape;
(e) the DA-IFP alliance will fall short of a majority over the ANC
and the New NP in KwaZulu-Natal;
(f) that the ANC's support in all the other provinces is
overwhelming; and
(3) is of the view that this study -
(a) shows the absolute falseness and absurdity of the DA's
propaganda that the New NP is a dying party and that, instead,
the gap between the New NP and the DA is fast narrowing; and ... [Time expired.]
Ms C BOTHA: Chair, I do not wish to object. I wish to propose an amendment.
An HON MEMBER: What amendment?
The DEPUTY CHAIRPERSON OF THE NCOP (Mr M J Mahlangu): You want to move an amendment? [Interjections.]
Ms C BOTHA: No, don’t worry, because the New NP now has more votes than you in the Western Cape. I wish to add that caveat that the HSRC …
Mr V V Z WINDVO[e]L: Deputy Chair, on a point of order: I want to know whether it is in order to amend an incomplete motion, because it may happen that the things she wants to raise are covered in the last part of the motion. [Interjections.]
The DEPUTY CHAIRPERSON OF THE NCOP (Mr M J Mahlangu): Let her move the amendment, and we shall then hear from the one who moved it whether he accepts it. Let us hear your amendment, hon member.
Ms C BOTHA: Hon Chairperson, I would like to add something. The motion ends with:
… we take cognisance of the fact that in 2000 the HSRC predicted that the DA would get 12% of the vote, and that this ended up being 23%.
Thank you. [Interjections.]
The DEPUTY CHAIRPERSON OF THE NCOP (Mr M J Mahlangu): The amendment has been raised by the member, but I am not going to put it to the House. It will appear on the Order Paper. [Interjections.]
Mr P A MATTHEE: Chair, on a point of order: I do not accept the amendment.
The DEPUTY CHAIRPERSON OF THE NCOP (Mr M J Mahlangu): It is all right. I have already said that the motion, your motion, will appear on the Order Paper. That was the last member to move a motion.
ITEM REMOVED FROM ORDER PAPER
(Draft Resolution)
The CHIEF WHIP OF THE COUNCIL: Deputy Chairperson, I move without notice:
That, notwithstanding Rule 23(2), the House meets at 10:00 on Tuesday, 25 November 2003.
Motion agreed to in accordance with section 65 of the Constitution.
LOCAL GOVERNMENT: MUNICIPAL FINANCE MANAGEMENT BILL
(Consideration of Bill and of Report thereon)
The DEPUTY MINISTER OF FINANCE: Deputy Chairperson and hon members, the National Treasury is pleased that the debate on the Municipal Finance Management Bill has reached the National Council of Provinces. We regard this as an important milestone in the process of finalising the long- awaited legislative framework enabled by chapters 3,7 and 13 of the Constitution. It has taken the greater part of three years to draft and refine the Bill, and we have lost count of the numerous versions.
The Bill covers for the local sphere of government similar issues that the Public Finance Management Act covers for the national and provincial spheres. This Bill was originally planned to be part of the Public Finance Management Bill when first prepared for tabling in 1998. However, the specific characteristics of local government were so different from the national and provincial spheres that it warranted a separate Bill.
The Bill involved two significant rounds of amendments to the Constitution. The first amendment which was passed in 2001 amended section 230 of the Constitution, which deals with municipal borrowing, by adding a new section 230(a) to permit municipal borrowing and long-term contracts.
A second amendment was effected early this year to section 139 of the Constitution, and dealt with provincial intervention in municipalities, allowing for a structured process with initial discretionary and then mandatory intervention by provincial government in the event of 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. It further protects municipalities whilst they are resolving their problems to enable them to continue providing services. Moreover, it provides certainty to lenders and investors about action that can be taken against municipalities that do not meet their financial obligations.
National Government is committed to facilitating a municipal borrowing market and will take steps to ensure that all spheres of Government act on their constitutional responsibilities. This commitment will enable Government to maximise delivery and allow municipalities that are able to borrow, to lower their costs of borrowing for capital expenditure and to attract investors.
At the same time we alert municipalities against attending courses, events and programmes on this legislation provided by nonregistered or nonaccredited institutions offering little value for money. The National Treasury, as part of our strategy in supporting municipalities, has initiated the employment of over 100 recently graduated interns from our disadvantaged communities to serve in municipalities across the country.
Furthermore, the National Treasury is in the process of developing a well- structured programme to enhance the technical skills required for prudent financial management in municipalities.
A key focus of reform relates to a comprehensive overhaul of the budgeting and financial management system at municipal level. These processes, systems, documents and information are often not people-friendly or easily understood. We aim to move away from the one-year line item budgeting approach.
Budget reforms such as the Medium-Term Expenditure Framework, budgeting by programmes, linking plans to resources and focusing on outputs and performance have not generally been implemented, save for a few pilot municipalities at the local sphere. The Bill before this House will introduce these reforms to municipalities over the next few years.
As with the PFMA, 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 for outputs and implementation.
Another aspect of the Bill deals with the strengthened oversight role by councillors over the municipal executive and officials with regards to the implementation of the budget and regular performance reporting requirements. The oversight and timely reporting to municipal councils are essential requirements for improved performance and accountability. The Bill provides for a transparent public process with the execution of projects and improved quality of information allowing for strategic policy decisions to be made on a timely and informed basis.
The proper, efficient and effective use of public funds is another key instrument at Government’s disposal to address the developmental challenges facing our country. Hence, the Bill provides for improved governance and oversight over entities, and at the same time imposes tough sanctions against accounting officers who fail to submit financial statements soon after the end of the financial year.
This measure is in line with the PFMA and deals with the legacy of poor compliance. Just as this is no longer tolerated for national and provincial departments, it will not be tolerated for municipalities.
Moreover, the annual report will include reports on performance to be audited in terms of the Systems Act. The annual report 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 remuneration packages of the mayor, the municipal manager, councillors and senior officials. The annual report will serve as an important tool for empowering both councillors and the local community to hold the municipal officials accountable for their performance in the delivery of services.
The Bill facilitates greater co-ordination between the spheres of Government, especially in the areas of budgeting, planning, policy implementation and the auditing process. The Bill promotes a more consultative and transparent process for national organs of state providing bulk resources such as electricity and water to municipalities, especially around price-setting policies. There is also a process to manage intergovernmental financial disputes.
The Bill will also promote public-private partnerships by allowing municipalities to enter into long-term contracts, subject to a regular review.
It is important to note that the Bill allows for a greater degree of consultation and communication with communities, residents, ratepayers, lending institutions and so on.
Municipalities must rise to the challenge by ensuring greater accessibility to these documents by all the communities they service. There is also an important role for the private sector to assist municipalities by investing and lending, and through public-private partnership initiatives.
We are grateful for the debates and comments received during the NCOP process, and which have led to a significant strengthening of the monitoring and support role by provincial government in nurturing our new local government dispensation.
The role of provincial treasuries relates largely to budget and financial monitoring, rendering support and advice on budget-related processes and policies. The sharing of information within provinces and an oversight role by provincial legislatures will allow for a coherent engagement.
The challenges are large, and many municipalities will be requiring support to implement this legislation. We are developing a coherent package of support and urge all municipalities to take advantage of this in implementing the legislation. This Bill is one of the foundation Acts of Parliament, required by the Constitution and the 1998 White Paper on Local Government.
In conclusion, we’d like to thank a number of persons who have contributed towards the Local Government: Municipal Finance Management Bill: the Minister for Provincial and Local Government, the MECs for finance and for local government, the chairperson and the Select Committee on Finance and all members of the provincial finance and local government committees for their support and guidance during the processing of the Bill.
We’d also like to thank officials from the national and provincial departments, organised local government and, especially, the tireless band of dedicated officials in the National Treasury who contributed in presenting the Bill to this House today. The challenge ahead is to ensure the successful implementation of the Bill.
Thank you very much, Deputy Chair. We are aware that there are some errors which, during the course of the debate today, are going to be effected on this Bill. Thanks a lot, Chair. [Applause.]
Ms Q D MAHLANGU: Chairperson, hon members and the Deputy Minister of Finance, it is with regret that I note that the provincial legislatures’ representatives are not in this House today and, to me, that is a serious concern because the Bill is of an important nature and we would all have benefited from their contribution in the debate.
However, we will proceed with the discussion, as we are empowered by the Constitution of our country. Section 216(1) of the Constitution prescribes that there must be uniform financial norms and standards, and Treasury measures which are applicable to all government departments by legislation must be prescribed.
In 1999 Parliament passed the Public Finance Management Act, regulating financial management in both national and provincial departments. This Bill, the Local Government: Municipal Finance Management Bill, which we are talking about today, applies to all municipalities, all municipal entities and national and provincial organs of state to the extent of their financial involvement in dealing with different municipalities.
The Bill before this House was deliberately omitted at the time of dealing with the Public Finance Management Act, primarily because local government was still undergoing major transformation in terms of the demarcations which were only finalised before the 2000 local government elections.
As a result of the above scenario, municipalities have been functioning without a legislative framework, and this Bill seeks to introduce the set of framework within which municipalities must operate in relation to Treasury control measures and financial management.
Issues were raised in the committee, and I’ll just raise a few of them. One of the issues was the tagging of the Bill - why the Bill was tagged as a section 75 Bill instead of a section 76 Bill. The committee was convinced that the decision to tag the Bill as a section 75 Bill was the correct one. Despite the fact that we were convinced that the decision was correct, we consulted with the senior legal counsel, who were constitutional lawyers in their own right, and we also consulted with the parliamentary law advisers. We, therefore, came to the conclusion that the joint-tagging mechanism did consider pertinent issues regarding the tagging and, therefore, it was correct to tag the Bill as a section 75 Bill.
This Bill will be administered, firstly, by the National Treasury, but the role of monitoring will be delegated to provincial treasuries, and the Bill covers the role of the provincial treasury extensively, as well as what they must do after being delegated by the National Treasury.
The National Treasury will enforce compliance within the prescript of the Constitution, section 216 in particular. In the spirit of co-operative governance in the main, the National Treasury will consult the Department of Provincial and Local Government where required or where necessary.
I will now talk about municipal revenues. The Bill makes provision for each municipality to open at least one bank account which will be used to deposit all moneys received by the municipality within the prescribed framework, in accordance with Chapter 3 of the Local Government: Municipal Finance Management Bill.
Municipalities may not open a bank account outside the borders of South Africa, or with an institution which is not registered in terms of the Banks Act of 1990, amongst others. This provision has come as a result of municipalities having many accounts in the previous era, and most of the time only a few officials knew what those accounts were about and how much money was in those accounts.
When municipalities open a bank account, they must submit those details of the bank accounts to the National Treasury, to the provincial treasuries and also to the Auditor-General. Accounting officers of municipalities, who are municipal managers in this case, will administer these accounts, and they must also ensure that they are enforced. It is hoped that this will enhance transparency in terms of the bank accounts that municipalities hold in different institutions.
There’s also a provision in the Bill that deals with the failure of municipal councils to approve the budget. The Bill also makes provision for circumstances where a municipal council fails to approve its annual budget and its revenue-raising measures to collect required revenue in order to give meaning to the budget.
The Bill ensures that mechanisms are in place to ensure a process where the municipal council must try over and over again till the budget has been approved. In circumstances where the budget cannot be approved for political reasons, amongst others, the Bill makes provision for provincial government to intervene.
Clause 55 of the Bill, which makes the intervention necessary, reads as follows:
If a municipality has not approved an annual budget by the first day of the budget year or if the municipality encounters a serious financial problem referred to in section 136, the mayor of the municipality -
a) must immediately report the matter to the MEC for local government in the province and
b) may recommend to the MEC an appropriate provincial intervention in terms of section 139 of the Constitution.
I think this provision ensures that there is a clear monitoring mechanism, in particular where budgets are unable to be passed. I think the previous intervention that the NCOP has made in different municipalities was a result of the failure of some legislative mechanism that existed. So, this provision seeks to close that gap and that loophole.
The budgets of municipal councils must be informed by their integrated development plans, as prescribed in the Local Government: Municipal Systems Act, namely that there must be time provided to give the public the opportunity to make comments on the draft budgets and the revenue projections, including the increase in rates and taxes. The public must be given an opportunity to comment and make suggestions or object, if they have any objections.
Municipal councils must also ensure that procurement of goods and services is guided by the supply chain mechanism as prescribed in the legislation. I have a serious concern with this supply chain mechanism, but not necessarily with the principle which is raised in the Bill. The concern is that the supply chain has not been tabled, neither in Parliament nor in the committees of Parliament, in this case the finance committees. They have neither seen nor laid sight on this supply chain.
Despite the existence of the preferential procurement legislation, which came as a result of the provision of the Constitution, there is no mention made of this in the legislation. Therefore this remains a serious challenge, and my question is: Which framework will municipalities be operating under, since the supply chain is not a law or any kind of a policy? I think this is important for clarity in the Treasury, and also for municipalities to be able to have a proper legal framework within which they are going to be operating, in particular around the procurement issues.
Councillors will no longer be allowed to sit on tender committees, as has been the case in the past, or to serve on committees that evaluate the tenders or approves tenders, quotations, contracts or other bids, nor will they be allowed to attend any meeting that considers tender processes as observers.
This provision is very important because it will allow municipal councils to exercise oversight over the work of the tender committees. On the other hand, it is a good decision because there is a wide perception out there that councillors are corrupt, and through this provision a fair and transparent process will be promoted and ensured.
There is also a provision in the Bill that deals with the disposal of assets, municipal assets in particular, controlled by municipal entities. Municipalities may not transfer ownership as a result of a sale or other transaction, or dispose of a capital asset needed to provide a minimum level of basic services to that particular community.
This provision is aimed at ensuring that municipalities do not dispose of capital assets that provide basic services to people, though it was very difficult for the committee to accurately define the basic services and what we are talking about exactly. The Local Government: Municipal Systems Act tries to give some indication as to what these basic services are, but I think the Bill provides for that.
Also, the role of provinces in supporting and monitoring local government in relation to their IDPs is very important. These are annual reports and annual budgets. Provinces will in future play a significant role in monitoring budgets, financial statements and audit reports of municipalities. This will ensure that problems are identified timeously in order to secure provincial intervention. These reports will give early warning signs and where necessary, intervention must be made before the situation is exacerbated.
Section 154(1) of the Constitution makes provision that the national and provincial government must give support to the lower spheres of government, in particular local government. Chapter 5 of the Local Government: Municipal Finance Management Bill, which we are considering today, spells out the capacity-building role of both the provincial and national Government.
Currently, there is an anomaly that exists, in the sense that Salga, which is organised local government, does not report anywhere for the moneys they receive from the Department of Provincial and Local Government or from the different municipalities from which they are getting levies. The committee is of the view that this matter must be attended to with the urgency it deserves, because if left like this, it may lead to situations where organised local government, at both national level and its affiliated provincial bodies, is accountable for all the resources they are allocated from different departments through transfers.
So, we think that this provision must be attended to. We know that it can’t be dealt with in the Local Government: Municipal Finance Management Bill, but probably through organised local government. The relevant committee in the NCOP will look into the matter.
This Bill is a milestone in our democracy and it has been in the making for the past three years, but I’m happy that we are able to recommend to the NCOP that the Bill be approved with the amendments made in the select committee. Given the very tight deadline the committee and the officials were subjected to, there are minor errors contained in the amended document that do not reflect the approved version of the committee. When the officials submitted the Bill to the printing people in Parliament, there were some other words which were reflected in the errata.
This document, which is on everybody’s desk, was left out. So now, this process seeks to make sure that those are effected before we adopt the Bill, and we should take that into account.
We would like to thank all committee members who participated throughout the process and earlier on when we were discussing the Bill with the National Assembly, the portfolio committee, the provincial local government portfolio committees and provinces, in particular the Western Cape and KwaZulu-Natal, who keenly participated in the process and made a valuable contribution in improving the Bill to what it is today. Thank you very much. I call upon hon members to approve the Bill. [Applause.]
Ms C BOTHA: Deputy Chair and hon Deputy Minister, I suppose the House can be forgiven for considering this Bill somewhat of an institution. It has been around, debated and amended, as was said here today, for about three years, and that is a marathon achievement by the committee and the legal advisors who are drawing it to near finality here today.
At the onset I must admit that I was never part of the finance committee deliberations, and my knowledge of the Bill is limited to reading and interparty discussions. I can therefore not presume to make more than comments relating to my constituency experience and on background reading on the matters which are addressed by this Bill.
When I say that it provides a policy framework for the overall financial management in the local sphere of government, as well as for structuring the borrowing powers of municipalities and providing essential options for interventions in times of financial crisis, I hope that I have understood the issues properly. What I do know very clearly is that the financial performance of local governments, or the lack thereof, is having a very direct impact on the daily lives of South African citizens.
Many inappropriate reactions from ratepayers have become embedded as a response to the flawed political and financial responses of local governments to the needs of municipal communities. I am often asked to support ratepayers who don’t want to pay for services which they are patently not enjoying. The ratepayers in the towns of Kwakwatsi, Viljoenskroon, Kroonstad, Ngwati and Edenville in my constituency are constantly confronted by raw sewage. They have every right to expect water of a certain quality. They have a logical response in not wanting to pay for what they are getting now.
In the same way citizens who were politically promised free basic services are responding as logically by not paying for services in expectation of the free offer.
While I do not agree with either, it is one real side of the municipal story. On the other hand, without private finance for capital investment in municipal infrastructural needs, municipalities can neither supply the basic nor the standard level of services required - services which are key to economic growth and social equity.
I do not want to oversimplify the responses needed for these situations, which I believe the present Bill will address, concentrating, as it does, both on accountability and practical municipal borrowing strategies. However, it will also need leadership from central level to create credible conditions at local level under which private finance will be forthcoming.
In the DA there was considerable debate on this Bill and the possibility that it was opening up undue interference by National Treasury in the municipal sphere and in the principle of local government autonomy which we hold dear. Our concerns have been subsumed by the need to face the actual state of local government and the interventions the new system of government requires. The increasing financial difficulties experienced by local municipalities cannot be addressed in an ad hoc fashion, but need to be responded to in a systematic and sustainable fashion, which this Bill provides.
We therefore support it and its aims of presenting Government with a coherent policy and a legal and institutional framework for dealing with fiscal and financial matters in municipalities. Thank you. [Applause.]
Mr K D S DURR: Chairman and Minister, it has taken the greater part of three years to draft, redraft and refine the Local Government: Municipal Finance Management Bill. In fact, in more than 40 committee hearings and sittings on the LGMFMB that took place in Parliament, the Western Cape province followed the developments of the Local Government: Municipal Finance Management Bill over the past two years closely, often attended those meetings and were kept informed by the Treasury and also by the select committee of the NCOP. Soon after the Minister of Finance tabled the LGMFMB in Parliament, during February 2002, it was referred to the Portfolio Committee on Finance. The Western Cape province has selectively attended committee and joint meeting hearings and regularly perused the minutes of these committee meetings.
As a province we respectfully insisted that the roles and responsibilities of local government and treasuries be kept clearly separated and defined. Most of our comments and recommendations that we have made along these lines regarding the relevant clauses were, in fact, accepted. In addition, we commented in favour of allocating original powers to the MECs for finance. We are glad that the bulk of these recommended amendments have now been incorporated into the version of the Bill that we have before us today.
Our decided view is that the National Treasury, together with the provincial treasuries, are best placed to exercise financial and fiscal oversight over local governments. This is largely based on their experiences in budget and financial management reform over the past five years which stand them in good stead in helping to build a viable local sphere that is responsive, fiscally stable and sustainable. However, in saying this, we recognise that the establishment of financially viable municipalities won’t be possible without a partnership between the departments of local government and the treasuries.
We are satisfied with the current wording of the Bill, but are reminded that, as with any piece of legislation or policy, there will be teething problems, especially with the implementation phase of the Act.
It is unfortunate that the Bill has to date not been costed, which is something that worries us. The National Treasury should as a matter of urgency cost the LGMFMB in order to determine the financial implications, if they can, with a view to funding provinces and municipalities to cover the related costs of the LGMFMB, with the proviso that the principle of “funds follow function” must be respected. Managers who will be operating within the three spheres of government need to familiarise themselves with the new context of local government financial management, especially bearing in mind the new competencies required of them. In this regard we request the Minister and the National Treasury to make training available as a priority. Minister, we can make the best laws in the world, but we have to develop the capacity and the administrative reach to give effect to that legislation.
We support the legislation, Minister, both as my party and as the Western Cape.
If I could just make a short appeal to the Deputy Minister, while she’s with us. I put a question on the Order Paper the other day about outstanding rates, and I see that there are something like R80 million outstanding to the Cape Town Metropole for rates on government buildings. I think the figure for East London is something like R26 million and other provinces all have, I think, large outstanding amounts. I think the Western Cape’s amount is the biggest, if I am not mistaken. We would really appreciate it if you could attend to - I am sure you are - getting that cash flow going, and getting that backlog out of the way, and have a system in place so that it doesn’t arise in the future. We know you will.
I have to say this is my favourite Deputy Minister. I hope it’s not bad that I say this, Minister, but you and your officials have been wonderful. I have to say they showed a lot of patience and put out voluminous documents, very competently and well, and patiently. They have been patient with us and they have been patient with our provinces. They have listened to us. They have always responded when we put forward sensible suggestions, for which we are grateful. I think we are making … [Time expired.]
Dr E A CONROY: Hon Chairperson, hon Deputy Minister of Finance and hon colleagues, the high degree of importance attached to this Bill is clearly demonstrated by the time devoted to it - from the first Cabinet approval for publication in July 2000; through the second Cabinet approval in August 2001 after consultation with provincial and local government, Salga and the FFC; to its final tabling in this House today - as well as the diligence displayed by all the roleplayers in the crafting thereof.
The Local Government: Municipal Finance Management Bill will become, so to speak, the Public Finance Management Act of local government. While the PFMA lays down uniform laws and standards for financial management in the national and provincial spheres of government, the LGMFM Bill provides for those same uniform norms and standards on local government level.
The aim of the Bill is to secure transparency, accountability and sound management. It covers a wide range of issues, including national and provincial supervision, municipal revenue and budgets, municipal debt, treasury processes, council responsibilities and financial misconduct.
It requires that all revenue, expenditure, assets and liabilities of municipalities and municipal entities be managed economically, efficiently and effectively. It, furthermore, determines the responsibilities of persons entrusted with local government’s financial management.
Generally, the municipal manager must take all reasonable steps to ensure compliance with the provisions of the Bill, and shall ensure effective, efficient and transparent systems of financial and risk management and internal control; a system of internal audit under the control and direction of an audit committee; an appropriate procurement and provisioning system which is fair, transparent, competitive and cost- effective; and a system to properly evaluate all major capital projects prior to final decision on the project.
One of the members of a municipal council must also be responsible for financial matters in the municipality. While the councillor for financial matters must exercise general political control over the financial affairs of the municipality and must oversee expenditure and revenue collection, he or she may, however, not interfere in the financial management responsibilities assigned to the municipal manager or chief financial officer.
The Bill furthermore allows municipalities to conduct their cash management and open investment ventures within the framework determined by the National Treasury, who will monitor these investments. Short-term debt may only be incurred as provided for by the terms of this Bill and must be paid off within the fiscal year. Long-term debt is permissible only for the purpose of capital expenditure on property, plant or equipment to achieve the objects of local government or for refinancing existing long-term debt.
The Bill requires the National Treasury to ensure that municipalities have the capacity to implement the financial responsibilities conferred on them. The Treasury will supervise their financial management and monitor their budgets to establish whether they are consistent with the national Government’s fiscal policy framework and macro-economic policy. It may establish an annual growth factor; assist municipalities to build efficient, effective and transparent financial management practices, and review any system of financial management and internal control in any municipality.
The Bill also provides for a Municipal Financial Emergency Authority, or an MFEA, to oversee the administration of municipalities in a financial emergency with a view to normalise the financial affairs of such municipalities. There are specific procedures for the declaration and management of a recovery plan and for the termination of a financial emergency. It gives specific powers to the courts in this regard, and it also outlines the powers of the executive officer of the MFEA and the administrators of the municipalities declared to be in a financial emergency.
The Bill goes a long way in addressing past problems associated with a lack of transparency and accountability of local government finances.
It bodes well for the reform and sound management of municipal finances and is fully supported by the New NP.
Chairperson, if you will also allow me to make use of this opportunity to thank, on behalf of the New NP and, I am sure, all the other parties in this House, Mr Ismail Momoniat, at present the Acting Director-General of the Treasury, and his support staff, for their dedication and devotion, and the long hours they put in towards the successful finalisation of this process. Thank you. [Applause.]
The DEPUTY MINISTER OF FINANCE: Deputy Chairperson, I would like to thank all the members who have participated in the debate. It is quite clear that the Bill enjoys a lot of support in the House. I think the fact that much time has been spent on this Bill has ensured that you can build the requisite support for a piece of legislation as important as the Local Government: Municipal Finance Management Bill in the context of financial management in local government. I think the support also indicates that we are all keenly aware of just this central role that local government plays in our lives and we are in agreement that, in going forward, we have to strengthen the capacity of local government to play an even greater role in improving the lives of our people.
The chair of the committee raised an issue around supply chain management in relation to the preferential procurement legislation that we have in place. I do want to say that our approach, as we are reforming the procurement system, is one that will ensure that our procurement system - in the way that it is managed at all levels of Government - promotes the spirit of the Public Finance Management Act and the Local Government: Municipal Finance Management Act when they do become law. We think that this is a critical part because departments spend a lot of money, a big portion of their budgets, on procurement. So, if through these pieces of the legislation we would have facilitated and enhanced the decentralisation of financial management, it would be good, because we could not keep an important part of spending at all levels of Government centralised, as it is today, through the system of tender boards.
The move, therefore, towards the supply chain management approach is one that will ensure that we are actually fully in keeping with the spirit of the PFMA and with the LGMFMA when they become Acts of Parliament. However, this is a matter that is separate from the issue of preferential procurement legislation. The approach that we should take is that there are flaws that we have been able to identify in the preferential procurement legislation, but these are changes that we are hoping to effect in line with other processes that are taking place in Government.
The issue, for instance, around aligning the preferential procurement legislation with the Broad-based Black Economic Empowerment Strategy and the Broad-based Black Economic Empowerment Bill is an important aspect in whatever process we are going to undertake to amend the preferential procurement legislation. However, as for now we operate on the basis that all public entities, all Government departments, must implement the preferential procurement legislation as it stands today. Only this week I approved a set of regulations that are aimed both at initiating the process of supply chain management, as well as improving the functioning of the preferential procurement legislation.
In a sense, these two processes are linked. However, the procurement legislation, as it stands today, remains the law that is in force and which we are improving at the moment through a new set of regulations. In the medium term we are going to be amending that legislation to make sure that it is in keeping with other processes and that we are able to deal with some of the weaknesses that were found through the experience of the past few years.
The issue of costing of the Local Government: Municipal Finance Management Bill I would treat as perhaps separate from the issue of funds following functions. I don’t think we can take an approach that says when we seek to improve financial management at local government we are imposing functions. This is something that is supposed to happen anyway. So I wouldn’t want to take the approach that says funds must follow functions. However, quite clearly, the costing issue is an important one, and at the moment we have in place a financial management grant specifically for local government which is meant to assist local authorities to improve their capacity for financial management.
However, this is something that we are going to have to work on because, as you may understand, the local government sphere is a much more diverse sphere than you have for the provincial government. The sizes of the municipalities differ and the requirements of financial management will also differ, but I think the crucial thing is that we do have a grant in place which is aimed at helping to build that capacity for municipalities to improve financial management.
I think from the experience of implementing the Public Finance Management Act, one of the biggest costs was to ensure that all departments appoint appropriately qualified chief financial officers. The rest really is about ensuring that we can put the proper systems in place to improve financial management. However, I take the point. It is an issue that we work on on an ongoing basis as we implement the new policy, but we are going to be rolling out a number of other processes.
We are going to have training workshops that we are going to conduct as part of the roll-out of the Bill. We are also introducing an internship programmme which is also aimed at kickstarting the process of improving financial management. We will issue training guides and manuals. So really, I think the benefit of having implemented the PFMA will go a long way in guiding us on how best to go about implementing this particular legislation.
The issue of debt management is an issue which we raised from the Treasury’s point of view because we think it is important that a number of basic things do happen. Municipalities must be able to build properly, but they must also build the capacity to collect revenue that is due to them. I think a large part of the debt actually relates, not just to the culture of nonpayment, but also to the basic inability of local authorities to go out there and collect revenue. We must address both of these, namely the capacity to collect revenue, and also changing the culture of nonpayment that is there in our communities.
This is a matter that we often dealt with at the time when there were calls for writing off some of this debt. What we were saying was: We can talk about that, but we must be able to see that there is an effort to go out and collect money that is outstanding. These are the things which I think are important.
The last point I would like to make is that we think the future is with local government. We are beginning to see some very positive things that indicate that local government increasingly is going to play a bigger role in our lives. If we look at the division of revenue, local government, for example, is experiencing quite a healthy growth in allocations. Even with the Budget Policy Statement that we tabled last week, the biggest percentage increase is to local government. We are also consolidating a variety of infrastructure grants that have been there for a variety of things into a comprehensive municipal infrastructure grant. I think all of these things are giving an indication that local government is going to play a bigger role in our lives. I think that the process deserves the support of all of us, but I would like to thank all the members for supporting the Bill.
Debate concluded.
Bill, subject to the proposed amendments and the errata/additions/corrections in respect of the amendments, agreed to in accordance with section 75 of the Constitution.
LOCAL GOVERNMENT: MUNICIPALITY SYSTEMS AMENDMENT BILL
(Consideration of Bill and of Report thereon)
The DEPUTY MINISTER FOR PROVINCIAL AND LOCAL GOVERNMENT: Chair, this chair is following me.
Deputy Chairperson, hon members, the transformation of local government in South Africa is one of the most far-reaching and important processes undertaken by the democratic Government since 1994.
The centrality of this exercise was recognised in the President’s Co- ordinating Council by the President and the nine premiers in December 2001, when they resolved in a workshop that local government transformation must be accelerated by focusing on five strategic areas, namely, one, building a strong local government sphere and enhancing its status within a stable co- operative governance framework; two, building a financially viable local government; three, building stable institutional and administrative systems in local government; four, improving and accelerating service delivery and economic development, and five, deepening local democracy and accountability.
Today’s deliberations in this House on the Local Government: Municipal Systems Amendment Bill are consistent with these areas of priority. The policy rationale for this Bill seeks to consolidate the transformation process and lays the basis for the long-term sustainability of local government in this country.
When we embarked on the final leg of transforming local government with the elections in December 2000, we appreciated that certain legislative refinements may become necessary to reinforce the overall policy orientation of developmental local government. This Bill speaks to key areas where we have learned some valuable lessons since the inception of the new system of developmental local government.
In April next year we will be celebrating 10 years of democracy in our country. Of course, there will be nothing to celebrate if the vision of transformation of our society and improving the quality of the lives of our people are not translated into tangible actions and outcomes at the local level.
Our country has attained significant achievements and gains in increasing access to basic services and improving the quality of life of our people. The emergence of developmental local government can only serve to entrench the gains made by our democratic state.
Progress in this regard is clearly demonstrated by the extent to which our Government has accelerated provision of basic services to all our communities, especially the previously neglected rural areas. Current statistics show that in the past 10 years we have made a significant impact on the ground. For example, 3,5 million households now have access to clean water; 6 million people received houses; access to sanitation has increased by 63%, and over 70% of households have access to electricity. This is significant and highly commendable progress that we have made.
Most municipalities have now reached the consolidation phase in the transformation process. In three years we have managed to develop the requisite systems and processes necessary to deliver basic services, and we have laid the basis for performance excellence. Already, we are able to demonstrate tangible progress in service delivery with regard to free basic services. We have achieved all this through continued commitment to co- operative governance by all three spheres of government.
The Bill being tabled here today should be seen as an extension of our policy and legislative framework on local government. It specifically aims to refine and encourage creativity and innovation by municipalities, whilst simultaneously ensuring transparency, accountability and good governance.
Premised on fundamental principles held by our Government of ensuring efficiency and excellence in service delivery, the framework for assigning functions and powers between the spheres of government increases the levels of predictability and coherence in the intergovernmental systems.
The national and provincial spheres of government are required to adequately provide the requisite capacity and financial support to local government to ensure that those functions or powers assigned to municipalities are effectively implemented. This will effectively address the problem of unfunded mandates and resolve capacity challenges municipalities constantly face.
The impact of service delivery on the ground depends largely on the ability of municipalities to make sound decisions regarding the best option of delivery they will use, as well as their ability to monitor and measure the performance in the process.
The positive feature of this Bill is that municipalities are required to report on their overall performance in an annual performance report. In the reports, municipalities should consider the levels of intended impact and whether their expenditure is commensurate with the quality of services. The ultimate measure of the performance of municipalities is the improvement of the quality of the lives of our people.
As you know, hon members, our department launched the Vuna Awards in June this year. These awards recognise the performance of municipalities and reward excellence. Provinces are at the centre of this process as they play their support and oversight role. In the past few months provinces have been assessing and managing the awards, and through this process they have identified the challenges faced by different municipalities.
The challenge we would like to put to the provinces today is for them to continue to assess municipal performance, identify the capacity gaps and develop intervention strategies that will support municipalities that are still struggling as they strive for performance excellence.
This Bill complements our efforts at deepening local democracy by requiring more transparency from municipalities. It strengthens access to information by communities by ensuring that all municipal documents are placed at strategic public places and are accessible to all, especially in rural communities.
It further encourages technological innovation, where possible, to ensure that municipalities are linked with the outside world by setting up websites. This Bill has a very strong focus on creating an enabling environment for municipalities to be creative and innovative in delivering services, while they remain transparent and take care of the needs of the poor.
The highlight of this Bill is the introduction of feasibility studies which provide certainty and predictability regarding the output of using a particular method of service delivery. It outlines the cost, value for money and timeframes, and compels municipalities to take into consideration the views of the local communities. This is critical to the decision-making process of municipalities and ensures the buy-in of communities. It is prudent for provincial and national spheres to proactively lend support to municipalities to ensure that the outputs are achievable and sustainable, especially in municipalities where the relevant technical capacity is not available.
Further innovations to service delivery in the Bill relate to external mechanisms in the delivery of services. This proposes the rationalisation of municipal entities, but limits them only to those that have a sound governance framework namely the private company, which is governed by the Companies Act, Service Utility and the Multi-Jurisdictional Service Utility as governed by the provisions of the Bill.
We are certain that service delivery will be greatly improved by these entities. More communities will benefit, especially in the case of the multijurisdictional service utilities, where more than one municipality owns the entity. Resources will be pooled and efficient delivery of services, even in areas where municipalities do not have the necessary capacity to deliver, will be ensured.
The Bill also enables municipalities to engage the services of other municipalities that have adequate capacity in a service delivery agreement. This will promote the spirit of horizontal co-operative governance and efficient use of capacity and limited resources.
The Bill provides clarity regarding the governance framework of the entities. We need to keep in mind that service delivery is primarily a Government obligation and the entities are an alternative mechanism by which efficiency in delivery is ensured. Government’s oversight role needs to be the key focus to ensure that the delegated authority complies with the principles of transparency and accountability.
The Bill may seem to be limited in scope, but it has far-reaching implications for service delivery and enhanced performance of municipalities. Therefore we need to ensure that the innovation provided by this Bill is nurtured and supported, and on 5 December this year, we can proudly celebrate the evolving system of developmental local government.
In supporting these amendments we need to recommit the provincial and national spheres to continuously assess municipal performance, while recognising that municipalities face a daunting challenge of limited capacity and resources. In assessing performance excellence for the Vuna Awards that I referred to earlier, the criteria used are linked to the critical mandate of municipalities; namely, service delivery; promoting economic growth and job creation; municipal transformation, and institutional development; municipal financial viability and good governance.
We need to commend the 27 municipalities that won the Provincial Awards and make a renewed commitment to provide support by using the framework provided by this Bill to improve the performance of all the 284 municipalities in our country. We committed ourselves to building a united, nonracial, nonsexist and democratic society. We are determined to achieve this goal and we are well on course. The tide has turned. I commend the Local Government Municipal Systems Amendment Bill to this House. I thank you, Deputy Chairperson. [Applause.]
Mr B J MKHALIPHI: Thank you, hon Deputy Chairperson, hon Deputy Minister and hon members. Deputy Chairperson, I am wondering, when we insist during committee meetings that we should corrade when deciding on crucial matters like legislation, whether these Houses corrade and whether we can continue with such pieces of legislation.
The Chairperson of the Select Committee on Finance lamented the fact that organised local government is not here. Surprisingly enough, she and two other members of the committee, after passing their Bill, they just went out. Surely, chairperson, that’s not my business of today.
The business of managing a municipality is becoming not only more complex, but more exciting these days. It is no longer the routine of applying somewhat lifeless by-laws and regulations, but the application of business principles and processing which is becoming a norm rather than an exception.
The Municipal Systems Amendment Bill on our tables this afternoon seeks to make these important innovations to enhance the capacity of local government service delivery and also tighten transparency and accountability. The amendments mainly provide the basis for the Municipal Finance Management Bill which we have just passed this afternoon. Perhaps we should have dealt with this amendment first, just for the purposes of logic.
Hon Deputy Chairperson, at present several sections of the principal Act refer to relevant municipal finance management legislation. With the passing of this Bill before us we will then be able to refer to a specific piece of legislation with some major degree of certainty. Therefore, sections 55 (2) (c); section 81 (2) (v) and section 74 (1) will now be reader-friendly.
Hon members, among the amendments contained in this Bill are elaborate measures to curb the so-called unfunded mandates by tightening conditions and undertakings which a Cabinet member or Deputy Minister must comply with before assigning any function or power to a municipality. Here we also note the involvement of the Financial and Fiscal Commission in a proactive and continuous manner. It will not only be visible during the hearings for the division of revenue. These provisions will, hopefully, go a long way in reducing and eventually eliminating the outcries about unfunded mandates imposed on local government.
During its deliberations on the Bill, the select committee proposed some amendments to the Bill passed by the portfolio committee. Firstly, we proposed that the awarding of performance bonuses to the municipal managers and other managers reporting to municipal managers, the so-called section 57 employees, be subjected to council scrutiny before payment.
During our oversight visits to some municipalities we became aware of cases where it seemed that managers in a municipality colluded to pay one another performance bonuses. Those bonuses were later questioned by councillors as to whether those managers did, in the first place, qualify for such bonuses.
The second amendment proposed is in regard to the role of municipal representatives in the shareholders’ meetings convened by municipal entities. In the committee some coined name developed, which is so interesting that I dare not mention it in this Chamber. The committee is of the view that active but limited participation of the municipal representatives would enhance and expedite matters in the meeting of shareholders.
The committee is, however, acutely aware that such shareholders’ meetings are governed by principles of corporate governance as prevailing in the private sector.
Having observed this, we should concede, though, that a municipality has an overriding interest and accountability for the success of the municipal entity and, therefore, cannot be expected to sit around and not participate when these crucial matters are discussed. We sincerely hope that our collegues in the portfolio committee will share similar views. My colleagues in the select committee will reflect on other matters on the Bill.
In conclusion, by passing this Bill, we will be going a long way towards meeting one of our constitutional obligations outlined in section 154 (1). Yes, of course, it is a tired quote; that is, ensuring that municipalities are assisted in order to manage their own affairs, to exercise their powers and to perform their functions.
Lastly, Chairperson, may I express our greatest gratitude to the senior officials of the department who went beyond the call of official duty during the deliberations of this Bill. I also commend this Bill for your approval, hon members, I thank you. [Applause.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Thank you, hon member. I must, before I call the next speaker, say that your concern with regard to the House that has been depleted has been taken care of and the duty whips have, actually, been informed accordingly.
Mnr C ACKERMANN: Voorsitter, ek wil graag die voorsitter van die gekose komitee bedank vir die rol wat hy in die hantering van hierdie wetsontwerp gespeel het. Die wyse waarop hy vandag gedebatteer het, asook die wysigings wat ons in die gekose komitee aanvaar het, wys vir u dat hy met toewyding en onderskeiding sy taak in die komitee verrig, en deeglik omsien na wetsontwerpe.
Weens die aard van die bepalings van die “Local Government: Municipal Finance Management Bill” wat ons nou net aanvaar het, is sekere wysigings aan dié wetsontwerp nodig. ‘n Besluit is geneem dat hierdie wysigings aangespreek moet word in ‘n aparte wetsontwerp, en nie as deel van die wetsontwerp wat ons goedgekeur het nie. Die wysigings word dus aangespreek in die wetsontwerp voor ons.
Die implikasies vir munisipaliteite is onder meer dat dit effektiewe regspersoonlikheidstelsels van staatsbestuur sal fasiliteer, die uitvoering van toegewysde funksies en bevoegdhede sal vereenvoudig, en ook dienslewering sal fasiliteer deur bepalings met betrekking tot dienslewering, ooreenkomste en die daarstelling van munisipale identiteite.
Die Nuwe NP is gelukkig met die wysigings aangesien dit ook die rol van beamptes en raadslede vergemaklik in die dag-tot-dag-bestuur van buite- diensleweraars, wat sal toelaat dat dienste op ‘n besigheidsvlak gehanteer en verskaf word.
Die wetsontwerp maak ook voorsiening dat die Kabinet addisionele funksies en bevoegdhede aan munisipaliteite kan toewys. Dit is werklik ‘n groot stap vorentoe om plaaslike bestuur op ‘n stelselmatige en natuurlike wyse te ontwikkel. Munisipaliteite het ook die reg om, onder meer riglyne daar te stel om aangeleenthede soos tariefstrukture te reguleer. Die wysigingswetsontwerp maak ook verder voorsiening dat die munisipaliteite jaarliks verslae moet voorlê oor hoe hulle presteer, en in dié opsig kan ons ons funksie van oorsig ook werklik tot uitvoer bring.
Daar bestaan geen twyfel dat dié wysigingswetsontwerp die aansien van plaaslike bestuur bevorder nie, en die betrokke gemeenskappe behoort ook baat te vind aangesien dienslewering aansienlik daardeur sal verbeter.
Die Nuwe NP steun dié wetsontwerp. Dankie. [Applous.] (Translation of Afrikaans paragraphs follows.)
[Mr C ACKERMANN: Chairperson, I would like to thank the chairperson of the select committee for the role he played in dealing with this Bill. The way in which he debated today, as well as the amendments that were accepted by us in the select committee, demonstrates to you that he executes his task in the committee with dedication and distinction, and deals thoroughly with Bills.
As a result of the nature of the provisions of the Local Government: Municipal Finance Management Bill that we have just accepted, certain amendments to this Bill are necessary. A decision was taken that these amendments should be addressed in a separate Bill, and not as part of the Bill that we have approved. Therefore the amendments are addressed in the Bill before us.
The implications for municipalities are that it will, among other things, facilitate effective corporate governance systems, streamline the execution of assigned functions and powers, and will also facilitate service delivery through provisions relating to service-delivery agreements and the establishment of municipal entities.
The New NP is pleased with the amendments in view of the fact that it also facilitates the role of officials and councillors in the day-to-day management of external service providers, which will allow that services are handled and provided on a business level.
The Bill also provides for the Cabinet to assign additional functions and powers to municipalities. It is really a major step forward in developing local government in a systematic and spontaneous way. Municipalities also have the right, among other things, to create guidelines to regulate matters such as tariff structures. The amending Bill also further provides for municipalities to present annual reports about their performance, and in this respect we can also really execute our function of oversight.
There is no doubt that this amending Bill promotes the esteem of local government, and the communities concerned should also benefit seeing that service delivery will be improved by it considerably.
The New NP supports this Bill. Thank you. [Applause.]] Ms N C KONDLO: Deputy Chairperson, hon Deputy Minister, the ushering in of developmental local government by the ANC-led Government has been one of the most important backdrops of ensuring a people-centred service-delivery approach by Government on issues that affect ordinary people on a day-to- day basis, for the betterment of their lives. The Local Government Municipal Systems Amendment Bill provides, amongst other things, for the establishment of municipal entities.
In the briefing by the department it was indicated that from the research the department had undertaken around municipal entities, it was clear that municipalities had established such entities without any guidelines, regulations or laws governing this, and the many entities that are in existence are not necessarily geared towards service delivery for our people.
The department has a way of ensuring improved service delivery, as well as entrenching accountability through this amendment, and allows only three kinds of entities to be established by a municipality, namely the private companies established in terms of the Companies Act; the service utility and the multijurisdictional service utility, both established in terms of a by-law.
The main features of these entities are that when established, they must perform duties and functions that will enhance the performance of a municipality or municipalities in terms of their powers and functions as set out in clause 8 of this Bill or section 5 of the Municipal Structures Act, or powers and functions assigned to them by the Constitution. The Bill states clearly that these entities have no competence to perform any activity which falls outside of their functions and powers, as would be contained in the by-law for both service utility and multijurisdictional service utility, as established. Most importantly, the engagement of such an entity must benefit the local communities, and the onus is on the municipality to demonstrate this.
Once a municipality establishes an entity, it is referred to as a parent municipality. I will not go into the terminology that was used and the explanation that was given to us by the department, but I must say that it was a hot debate in the committees.
Once any of these entities is established by a municipality, there are lines of accountability that are set in motion for the parent municipalities to ensure adherence thereto by entities. A parent municipality has sole control over entities. It has the responsibility to ensure compliance with all laws that are applicable to their functioning, that is, the function of the entities.
It must also ensure that the annual performance objectives and indicators for the entity are contained in an agreement which must be reviewed annually, in which case, if the entity does not meet its obligations, has persistent financial problems and is not able to impose a financial recovery plan as was established or agreed, this Bill then allows for the possibility of the disestablishment of such an entity. If two municipalities enter into such agreements, they will have shared control over the entity. They too, as parent municipalities, have to enter into a mutual agreement regulating a whole range of issues, such as performance, payment of moneys due to the entity, or the other way round, and dispute resolution, up to the disestablishment of that entity. We see all these amendments as seeking to strengthen political accountability, as well as the oversight role of councillors.
Ezi zihlomelo zinenjongo yokuqinisekisa ulawulo oluluqilima, ukususa amakhwiniba asenokuba ngumqobo kulawulo loorhulumente basemakhaya. Kananjalo, zinenjongo yokuqinisekisa ukuvala amazibuko khon’ ukuze iinkonzo ezimele ukuxhanyulwa luluntu zize ngokupheleleyo nangokucacileyo ebantwini. Loo nto iza kwenza ukuba kungasoloko kukho isimbonono esibonakalisa ukungathembeki kwendlela ezisetyenziswa ngayo iimali ezinikwa oorhulumente basemakhaya.
Ngala mazwi ambalwa ke, ndithi ngezi zihlomelo, uphuhliso loluntu luya phambili. Sithi maz’ enethole kweli sebe ngezi zihlomelo! Siyazixhasa siyi- ANC. Ndiyabulela, Sihlalo. [Kwaqhwatywa.] (Translation of isiXhosa paragraphs follows.)
[These amendments are aimed at ensuring good governance and removing obstacles to good governance at local government level. Furthermore, they are aimed at ensuring that the services that are supposed to be enjoyed by the communities are delivered. That will remove the constant grumble indicative of the lack of confidence in the manner moneys allocated to local government are spent.
In those few words, it is my view that with these amendments we are taking forward the development of our people. We say thank you to this department for these amendments. As the ANC, we support them, Chair. [Applause.]]
Me C BOTHA: Baie dankie, mnr die Voorsitter. As sy my toespraak gehoor het, sal my voorganger wel kan verstaan wat “‘n paar woorde” beteken.
Die DA steun hierdie wetsontwerp omdat die toepassing meer effektiewe regering en beter finansiële bestuur van munisipaliteite behoort mee te bring.
Daar is nog voorgestelde wysigings afkomstig van die NVP wat nog voor die portefeuljekomitee sal dien, maar die DA bly by die ondersteuning van die oorspronklike Nasionale Vergadering-formulering. Ek dank u. [Applous.] (Translation of Afrikaans paragraphs follows.)
[Ms C BOTHA: Thank you very much, Mr Chairman. If she had heard my speech, my predecessor would have understood what is meant by “a few words”.
The DA supports this Bill, because its implementation should bring about more effective governance and better financial management of municipalities.
There further proposed amendments from the National Council of Provinces that will be brought before the portfolio committee, but the DA stands with supporting the original formulation by the National Assembly. I thank you. [Applause.]]
Mrs E N LUBIDLA: Thank you, Deputy Chairperson. Since there is no law that says you must use all your time allocated, I will use Mr Durr’s time this time. [Laughter.]
The commitment to public participation in the affairs of the municipality is strengthened and made more visible and practical in this Bill. Municipalities are increasingly becoming aware that they will also have to account as to how they interact with the community, as outlined in section 21 of the principal Act. The fact that local notices must also be published in the provincial Gazette, ensures that there is oversight over the communication function of the municipality by the provincial government.
Section 21 of the principal Act is strengthened by stipulating that documents must be made public by displaying them in a conspicuous place in all offices. A further innovation in these amendments is the requirement that the municipality should also display these documents on its official website, if it does have one, and also indicate in the notice where further details can be obtained. If the municipality cannot afford to establish its own official website, it must arrange with organised local government to display its notices.
As this Bill seeks to elaborate on the governance of municipal entities, the transparency demands mentioned earlier are attempts to prevent the advent of fly-by-night and other problems that may arise.
The external service provider may not change residence as it wishes. Public participation could be said to be a crucial tool to enhance transparency and accountability on local governance. Participation does not only entail attending report-back meetings or work committee briefings, and is not confined to the discussion of annual reports. This Bill demonstrates these facts by indicating clearly how the ordinary resident and businessperson can innovate by supporting the municipality in service delivery by exploring the various options to deliver a certain service which has been agreed upon. This initiative clearly demonstrates the options available to municipalities in dealing with the obligation of initiating local economic development.
In conclusion, municipalities are required by section 46 of the principal Act to submit annual performance reports. The amendment is that the performance of each external service provider should be part of the said annual report and indicate whether the set targets have been met or not. The ANC supports the amendments.
The DEPUTY MINISTER FOR PROVINCIAL AND LOCAL GOVERNMENT: Thank you, Deputy Chairperson. Firstly, I would like to thank all the members who participated in this debate and I also want to thank all the political parties for supporting this Bill.
The chairperson of the select committee referred to the representation in the shareholders’ meetings. My understanding was that the contentious issue was around the representation in the board meetings and I only hope that, if that is the case, that issue will be resolved either way.
The Deputy Minister of Finance referred to the efforts of the municipalities with regard to finance management, particularly with regard to the collection of revenue, etc. However, I want to assure the House that municipalities are actively involved in implementing a programme of trying to recover whatever outstanding debts there may be. There is a programme that they are involved in, together with the assistance of the provinces, so there is that assistance that comes from provinces with regard to that, as well as Salga.
Lastly, this Bill is in a way aimed at complementing the legislation that was debated just before this - The Local Government: Municipal Finance Management Bill. All of us do agree, of course, that municipal finance management systems require urgent attention. I do not disagree with the Deputy Minister on that, but we think that that legislation that they had passed, which was before this House earlier, also will go a long way in addressing the challenges that municipalities face. Together these two Bills will fortify the foundation of our system of developmental local Government that we have started to grow. I would like to thank the select committee for the hard work they have put into this Bill, which has come up with a product that has been refined. Thank you very much.
The DEPUTY CHAIRPERSON OF COMMITTEES: I have been advised that we do not form a quorum. [Interjections.] … Are you sure? … Thank you very much. I am reassured again that now we do have a quorum.
That concludes the debate. I shall now put the question that the Bill, subject to proposed amendments, be agreed to. In accordance with Rule 63, I shall first allow political parties to make their declarations of vote, if they so wish. There is none. Those in favour say aye.
HON MEMBERS: Aye!
The DEPUTY CHAIRPERSON OF COMMITTEES: Those against say no.
HON MEMBERS: No!
The DEPUTY CHAIRPERSON OF COMMITTEES: I think the ayes have it. The majority of the members have voted in favour. I declare the Bill, subject to proposed amendments, agreed to in terms of section 75 of the Constitution. [Applause.]
PENSIONS SECOND (SUPPLEMENTARY) BILL
(Consideration of Bill and of Report thereon)
Ms Q D MAHLANGU: Deputy Chair, the Select Committee on Finance met on 18 November 2003 to consider all pieces of legislation that were put before it and, amongst others, to approve the Pensions Second (Supplementary) Bill. The Bill was considered by the National Assembly’s Standing Committee on Private Members’ Legislative Proposals and Special Petitions, and subsequently presented to the National Assembly for approval. The National Assembly, as a House, approved this Bill. Therefore, the select committee considered all those factors and took them into account when making its decision.
I would like to report to the House that the Bill was brought to the select committee. Let me just take the House back to 1998. When I came to Parliament, one of the pieces of legislation that we were confronted with was the piece of legislation that asked Parliament to give powers to the National Treasury - then part of the Department of Finance - to charge the National Revenue Fund a certain amount to be paid to Mrs Botha. [Interjections.] No, no, not your relative, Sandra; that is another Mrs Botha.
So, in 1998 we rejected that Bill on the grounds that by approving it, we would be setting a precedent that everybody else - people who were disgruntled one way or the other with the previous Public Service or civil service - would therefore open up and wake up to the realisation that if they petitioned Parliament, they would be granted such additional pensions. We, therefore, rejected the Bill on those grounds, including having considered that the National Treasury - at that time the Department of Finance - was opposed or is still opposed to this kind of arrangement. The committee considered all that and the historical context that I have just given.
The committee then took a decision that we could not approve this piece of legislation which, in simple terms, wants to make the National Treasury charge the National Revenue Fund an amount of approximately R2 200 which will be given to Mrs Botha for having served in the previous Public Service. The committee is of the view that we will be setting a precedent if we grant this amount to Mrs Botha because, in future, we cannot say no to other people. Therefore, it is appropriate that we reject this request which has been approved by the National Assembly in particular, and which was brought to its Standing Committee on Private Members’ Legislative Proposals and Special Petitions.
We are not doing this because we are not concerned or not sympathetic to the issues and circumstances that Mrs Botha is in, but we are of the view that, in principle, we cannot just approve such things because in future they are going to create problems, particularly with all the immense challenges we have. We have many people in South Africa who are poor and who do not even have the amount of money that Mrs Botha gets, and who are able to survive on a daily basis. So, we think that it’s inappropriate that Mrs Botha must be paid this amount. Therefore, the committee proposes that the Bill be rejected. [Interjections.]
Mr K D S DURR: Chairman, I don’t know who Mrs Botha is. I have never met her, but I would like to say that according to our colleagues in the other place, this lady apparently was a nurse who worked amongst the poorest of the poor for 27 years and has not received her pension. She has a small grant of R14 000 which she received in the 1980s, I think.
She has spent years petitioning this House, and her petition has been heard by the petitions committee of our colleagues in the other place. Our colleagues in the other place, a multiparty committee, have decided that this lady is deserving of this pension, and they have come to us purely for authorisation of the additional pension granted in order for the transfer to take place.
If we were dealing with the merits of the case, then we should at least hear the representations. We cannot reject recommendations from our colleagues in the other House without looking at the merits of the case, which we have never had before us. None of us have seen the case of Mrs Botha or had Mrs Botha before us.
On the question of the precedent, we have had precedents since 1913. There have been 84 precedents since 1913. This is a right that parliaments maintain for themselves. The fact of the matter is that we have established no precedent. It’s an ad hoc right we have; it’s the exception that proves the rule. I would have thought that either we should approve it and have the milk of human kindness to do so, or at least show our colleagues in the other place the courtesy of listening to the arguments which were before them before we reject such a case.
I can mention a lot of precedents. Many ANC cadres have received special pensions that we voted for. That is fine. There is nothing wrong with that. I’m not criticising it. I am just saying that there are many precedents … [Interjections.]
Ms Q D MAHLANGU: On a point of order, Chair …
Mr K D S DURR: There are many precedents. I don’t know whether this lady is black, white or brown. [Interjections.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Sorry, hon member!
Mr K D S DURR: All I know is that she has done a huge public service which our people in the other place, who have evaluated her, have thought deserving.
Ms Q D MAHLANGU: On a point of order …
The DEPUTY CHAIRPERSON OF COMMITTEES: Hon Durr!
Mr K D S DURR: And I want to support that.
The DEPUTY CHAIRPERSON OF COMMITTEES: Hon member!
Mr K D S DURR: I call upon the members of this House to have a free vote and we should vote for Mrs Botha. I thank you. [Interjections.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Hon Durr! I have been calling upon you for a very long time to stop and listen to the point of order. I don’t know whether you heard that or not. However, in any case, you have finished now.
Mr K D S DURR: Mr Chairman, on a point of order: Can I ask that we should have a free vote on this matter in this House?
Debate concluded.
Declaration of vote:
Dr E A CONROY: Agb Voorsitter, daar word voorsiening gemaak dat kiesers of LP’s die Parlement kan nader met ‘n petisie vir hulp in die vorm van wetgewing en dat die Parlement aan hierdie beginsel uitvoering moet gee.
In hierdie betrokke geval is die petisie deur die agb Francois Beukman, Nuwe NP-LP en voorsitter van die Staande Komitee: Openbare Rekeninge, ingedien namens Mev Mercia Botha wat ernstig deur die vorige regering voor 1994 ten opsigte van pensioenreëlings benadeel was. Die doel van die petisie was om hierdie onreg reg te stel.
Die petisie deur agb Beukman is ná ‘n lang proses van voorleggings eenparig deur die Nasionale Vergadering se Staande Komitee oor Privaatlede se Wetgewende Voorstelle en Spesiale Petisies en die Portefeuljekomitee oor Finansies aanvaar. Die wetgewing wat hiervoor voorsiening maak, is ook deur die Kabinet goedgekeur.
Die agb Beukman het trouens ook die agb Minister van Finansies in die openbaar bedank vir sy rol om die wetgewing deur die Kabinet te voer.
Die Nuwe NP se gevoel is dat die Parlement duidelik moet toon dat die Parlement toeganklik is, dat verontregte persone aangehoor sal word en dat oplossings wel beskikbaar is.
Die Nuwe NP stem dus vir die aanvaarding van die wetsontwerp.
Question put: That the Bill be agreed to.
Mr K D S DURR: Chairperson, I would like you to note that the chairman of the select committee voted for this legislation.
Mr A E VAN NIEKERK: Chairperson, on a point of order: I ask for a division, as there is some confusion.
The DEPUTY CHAIRPERSON OF COMMITTEES: But there was no confusion, actually.
Mr A E VAN NIEKERK: I ask for a division, Sir.
Division demanded.
Mr K D S DURR: Mr Chairman, may I address you? Because this is a matter of an individual and not a party matter, may I please request that the Whips withdraw themselves from this debate and allow the members a free vote in this division. Thank you. [Interjections.]
An HON MEMBER: What?
Mr K D S DURR: I request that members be allowed a free vote in this division.
The DEPUTY CHAIRPERSON OF COMMITTEES: Mr Durr, I don’t understand that.
During division:
Mr V V Z WINDVOЁL: Hon Chair, is lobbying allowed in the House, such as Mr Lever is doing? That is intimidation. [Interjections.]
The CHIEF WHIP OF THE COUNCIL: Deputy Chairperson, with the greatest respect …
The DEPUTY CHAIRPERSON OF COMMITTEES: Order! Order! Order! Please.
The CHIEF WHIP OF THE COUNCIL: With the greatest respect, the Whippery was directed to count and to assist the Chair in counting, not to approach a member to convince or lobby a member to vote in a particular way. I think that that is absolutely irregular. The hon member Vilakazi inquired from me as to where she should sit if she were to abstain. I approached the Table and the Table indicated to me that she should sit where she was. I indicated that to her. I cannot understand how she could, after having been approached by the hon Lever, now change her mind about the matter.
The DEPUTY CHAIRPERSON OF COMMITTEES: Thank you, Chief Whip. Order! Order! Order! Please. Hon members, please! Mrs Vilakazi, I am sure that you have heard what the Chief Whip has said. Could you perhaps clarify whether you abstain …
Mrs J N VILAKAZI: I am voting. I have changed my mind.
The DEPUTY CHAIRPERSON OF COMMITTEES: Seemingly, she is also voting. Thank you. Would you be kind enough to sit down, please. The House is in session. Yes, Mr Lever?
Mr L G LEVER: The Chief Whip has indicated that he considers what I did irregular. I think I should at least be allowed an opportunity to answer that, in the circumstances.
The DEPUTY CHAIRPERSON OF COMMITTEES: OK. I want to know how many members you have right now.
The Council divided:
Debate concluded.
Question put: That the Bill be agreed to.
Division demanded.
The Council divided:
AYES - 10: Permanent delegates: Ackermann, C; Botha, C-S; Conroy, E A; Durr, K D S; Lever, L G; Matthee, P A; Sono, B N; Tlhagale, J O; Van Niekerk, A E; Vilakazi, J N.
NOES - 20: Permanent delegates: Kolweni, Z S; Kondlo, N C; Lubidla, E N; Mahlangu, Q D; Makoela, M I; Mashangoane, R P; Mkhaliphi, B J; Moatshe, P; Mokoena, M L; Nogumla, R Z; Nyakane, R M; Ralane, T; Ramodibe, D M; Sogoni, H T; Sulliman, M A; Surty, M E; Themba, M P; Thomson, B; Tolo, B J; Windvoël, V V Z.
Question not agreed to.
Bill accordingly rejected.
Mr V V Z WINDVOЁL: Hon Presiding Officer, I am rising a very serious concern. During the debate when Mr Durr was requested by the Presiding Officer to take a seat because the hon Mahlangu was rising on a point of order, there was a great show of disregard and disrespect for the Presiding Officer, which one didn’t expect, for that matter, from a man who comes from the ACDP - the party which upholds Christian values.
I think that matter can set a very wrong precedent that a Presiding Officer will not be listened to and his rulings not adhered to when he instructs a member to take a seat.
It is my view that the hon member responsible for such action should apologise. Thank you. Mr K D S DURR: Mr Chairman, I rise to apologise in respect of that. [Applause.]
CONSIDERATION OF REPORT OF SC ON FINANCE ON AGREEMENT BETWEEN THE GOVERNMENT OF THE RSA AND THE GOVERNMENT OF THE REPUBLIC OF RWANDA FOR THE
AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION IN
RESPECT OF TAXES ON INCOME
Mr Z S KOLWENI: Thank you, Deputy Chairperson, the Government of the Republic of South Africa and the government of the Republic of Rwanda, desiring to promote and strengthen the economic relations between the two countries, have developed this framework to facilitate avoidance of double taxation and the prevention of fiscal evasion. Furthermore, this agreement shall apply to persons who are residents of one or both of the contracting states.
Whereas a range of issues pertaining to economic activities has been elaborated upon in detail, where you find a variety of articles such as business profits out of enterprises and taxation patterns, to mention but a few.
The report goes further to touch on shipping and air transport operations. Hence everything is centred around people-to-people and state-to-state relations. Articles 10, 11, 12 and 20 provide us with in-depth information in respect of business interests, royalties and dividends.
Further, the report covers the aspect of students, apprentices or business trainees who are present in a contracting state solely for purposes of their education or training.
Finally, the entire agreement becomes part of the law of South Africa and is entered into in terms of section 108 of the Income Tax Act of 1962. I move that this House accept this agreement. [Applause.]
Debate concluded.
The DEPUTY CHAIRPERSON OF COMMITTEES: Thank you. I shall now put the question in respect of the 5th Order, the question being that the report be agreed to. As the decision is dealt with in terms of section 65 of the Constitution, I shall first ascertain whether all delegation heads are present in the Chamber to cast their provinces’ votes. I hope that they are all in. It seems as if they are all in. In accordance with Rule 72, I shall first allow provinces the opportunity to make declarations of vote, if they so wish. There is none.
We shall now proceed to the voting on the question, and we shall do this in alphabetical order, per province. Delegation heads must please indicate to the Chair whether they vote in favour or against, or abstain from voting. Eastern Cape?
Ms N C KONDLO: IMpuma Koloni, Sekela-sihlalo, iyayixhasa ngokupheleleyo kwaye iyamkela ngezandla ezingena mikhinkqi. [The Eastern Cape, Chair, fully supports the report and accepts it wholeheartedly]
The DEPUTY CHAIRPERSON OF COMMITTEES: Free State?
Mr T S SETONA: Supports.
The DEPUTY CHAIRPERSON OF COMMITTEES: Gauteng?
Ms J L KGOALI: Gauteng e a tlatsa. [Gauteng supports.]
The DEPUTY CHAIRPERSON OF COMMITTEES: KwaZulu-Natal?
Ms B THOMSON: Iyaxhasa. [Supports.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Limpopo?
Mr M I MAKOELA: Re a e amogela. [We support.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Mpumalanga?
Ms M P THEMBA: Mpumalanga ke ya rona. [Mpumalanga supports.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Northern Cape?
Mrs E N LUBIDLA: Northern Cape ke ya rona. [Northern Cape supports.]
The DEPUTY CHAIRPERSON OF COMMITTEES: North West?
Mr Z S KOLWENI: North West ke ya rona. [North West supports.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Western Cape?
Mr C ACKERMANN: Western Cape ke ya rona. [Western Cape supports.]
The DEPUTY CHAIRPERSON OF COMMITTEES: All nine provinces have voted in favour. I therefore declare the vote agreed to. [Applause.]
Report accordingly adopted in accordance with section 65 of the Constitution.
CONSIDERATION OF REPORT OF SC ON FINANCE ON AGREEMENT BETWEEN THE GOVERNMENT OF THE RSA AND THE GOVERNMENT OF THE REPUBLIC OF BOTSWANA FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION IN
RESPECT OF TAXES ON INCOME
Mr Z S KOLWENI: Chairperson, once again, the objectives of the agreement are to avoid double taxation. There is, however, one difference between the agreements between South Africa and Rwanda, and South Africa and Botswana. The Botswana government has insisted that a clause be inserted to allow either South Africa or Botswana to charge tax on profits of material enterprise - that is an enterprise involved in the business of mining - at a rate different from the rate charged on the profits of any other enterprise.
Internal domestic law gives the Botswana Minister of Finance the right to negotiate such agreements with companies, and this does not adversely affect the terms of the convention. South Africa also applies a different tax rate to its gold mining companies.
Furthermore, article 28, which is about bringing the agreement into force, provides that the contracting states shall notify each other once the legal procedures required in each country for bringing the convention into force have been completed. The convention will then come into force on the date of receipt of the later of these notifications.
Finally, the entire convention becomes part of the law of South Africa and is entered into in terms of section 108 of the Income Tax Act. I move that this House adopts this agreement. Thank you. [Applause.]
Debate concluded.
The DEPUTY CHAIRPERSON OF COMMITTEES: I shall now put the question in respect of the sixth Order. The question is that the report be agreed to. As the decision is dealt with in terms of section 65 of the Constitution, I shall first ascertain whether all the delegation heads are present in order to cast their provinces’ votes. They are all in. Then in accordance with Rule 73, I shall first allow provinces the opportunity to make their declarations of vote, if they so wish. It seems there is none.
We shall now proceed to the voting on the question. I shall do so in alphabetical order, per province. Delegation heads must please indicate to the Chair whether they vote in favour or against, or abstain from voting. Eastern Cape?
Ms N C KONDLO: Mpuma Koloni ke ya rona. [Eastern Cape supports.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Free State?
Mr T S SETONA: Supports.
The DEPUTY CHAIRPERSON OF COMMITTEES: Gauteng?
Ms J L KGOALI: Ke ya rona. [Supports.]
The DEPUTY CHAIRPERSON OF COMMITTEES: KwaZulu-Natal?
Ms B THOMSON: Ke ya rona. [We support.] The DEPUTY CHAIRPERSON OF COMMITTEES: Limpopo?
Mr M I MAKOELA: Ekothendelana. [We support.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Mpumalanga?
Ms M P THEMBA: Ke ya rona. [We support.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Northern Cape?
Mrs E N LUBIDLA: Eyethu. [We support.]
The DEPUTY CHAIRPERSON OF COMMITTEES: North West?
Mr Z S KOLWENI: Ke ya rona. [We support.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Western Cape?
Mr C ACKERMANN: Ke ya rona. [We support.]
The DEPUTY CHAIRPERSON OF COMMITTEES: All nine provinces have voted in favour of the report. I therefore declare the report agreed to. [Applause.]
Report accordingly adopted in accordance with section 65 of the Constitution.
CONSIDERATION OF REPORT OF SELECT COMMITTEE ON FINANCE - AGREEMENT BETWEEN THE GOVERNMENT OF THE REPUBLIC OF SOUTH AFRICA AND THE GOVERNMENT OF THE SULTANATE OF OMAN FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION IN RESPECT OF TAXES ON INCOME
CONSIDERATION OF REPORT OF SELECT COMMITTEE ON FINANCE - AGREEMENT BETWEEN THE GOVERNMENT OF THE REPUBLIC OF SOUTH AFRICA AND THE GOVERNMENT OF THE REPUBLIC OF BELARUS FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION IN RESPECT OF TAXES ON INCOME AND ON CAPITAL (PROPERTY)
CONSIDERATION OF THE REPORT OF THE SELECT COMMITTEE ON FINANCE - CONVENTION BETWEEN THE GOVERNMENT OF THE REPUBLIC OF SOUTH AFRICA AND THE GOVERNMENT OF THE FEDERATIVE REPUBLIC OF BRAZIL FOR THE AVOIDANCE OF DOUBLE TAXATION AND THE PREVENTION OF FISCAL EVASION IN RESPECT OF TAXES ON INCOME Mr K D S DURR: Chairperson, I’m aware that I am probably setting an ACDP record for speaking time this afternoon. [Laughter.] It is my privilege on behalf of the committee to deal with the three double taxation conventions, namely, Oman, Belarus and Brazil.
The agreements reflect the growing integration of South Africa into the world community and the deepening of our diplomatic, trade and financial relations. They also reflect the growing pattern of movement of South African professionals working abroad. They also reflect, or anticipate, the growing interaction and investment in South Africa and the different regions of the world before us. All of this holds up much promise for the future.
The Oman agreement, the first agreement I will deal with, is between the Government of the Republic of South Africa and the government of the Sultanate of Oman, and it is for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income. The Gulf is a major trading area and a growing market for us. Oman is an important country in that area. Oman is a major capital exporter with a long tradition of trading in the Indian Ocean region. It is a member of the Indian Ocean Rim grouping of states.
It may interest members to know that it was the great Sultan of Oman, many hundreds of years ago, who gave his name to Mozambique. His name was Mussa Ben Mbiki, which is where Mozambique derives its name from. They have traded in the Indian Ocean for a very long time, and they are interacting with us now on the Indian Ocean Rim.
As a country, we are focusing on the Gulf states, some of which are attempting to become economic hubs in the region. Our construction companies are very active in the region, and large numbers of South African professionals have been and are being recruited to work in the area. We can expect to conclude this agreement and others like it in the region in the future. They are of much more than simply bilateral political interest. They affect the lives and livelihoods of our people.
We have good relations with Oman, and this will strengthen those relationships further. Of particular interest is that they are in the process of tax harmonisation, and that clause 3(1) of the protocol permits them the breathing space to treat local and branches of foreign companies similarly. So, I move that agreement.
Regarding the agreement on Belarus, the second on the Order Paper, this again reflects our growing interaction with the former Eastern bloc country. Belarus is situated on the Baltic Coast, and as such finds itself on the Baltic Rim, one of the world’s fastest growing and richest markets which, I believe, is doing something like 15% of world trade.
The Baltic, which divided people at the time of the Cold War, now unites everyone on its rim. We have ratified a treaty with the Russian Federation, and we are currently negotiating with Estonia, Latvia and Luthuania, also just north on the rim. We signed an agreement with Finland in 1995. The area has huge potential growth for us as South Africans. Of specific interest may be that the agreement specifically excludes federalism. This reflects the nature of the Belarus constitution, and their sentiments are thus contained in article 1 of the protocol. Article 2 reflects the fact that they do not have a concept of usufruct of immovable property, as we have, so that is excluded. Here again we see growing relations and potential for future growth in an important area, and I move this agreement.
The third agreement I have the pleasure of moving is the one negotiated specifically between South Africa and the Federative Republic of Brazil. As with others, this agreement closely follows the OECD model.
The interesting thing is that South America has been somewhat inwardly focused as far as taxation systems are concerned. As we know, Brazil is one of the great markets of the world. I think she has the tenth biggest economy in the world now. She is trying to expand her tax treaties with the world, just as we are. Members have read the agreements and the excellent explanatory memoranda that have been made available to us by the Department of Finance, and that have been motivated to us in the select committee. So, I will not deal with all 30 of the articles of the agreement.
However, article 4 of the protocol, as a most-favoured-nation clause, is interesting and worthy of note, namely, that should Brazil subsequently conclude a convention for the avoidance of double taxation with a third state which is not located in South America, as far as capital gains is concerned, then that similar treatment will automatically apply to us in respect of the convention.
The President of Brazil has only recently visited our country. I think this agreement with them was signed in principle - that which we are asked to ratify today - on 8 November when we signed the agreement. Brazil is clearly interested in expanding her trade and influence in Africa, just as we in South Africa seek to extend our reach in South America. This agreement reflects all of those good things, and I therefore move that agreement.
All that remains for me to say is that we in this House welcome these agreements, and our congratulations go out to the parties concerned. It is always wonderful to make new friends in the world and to deepen our friendships. The more we do that, the better for us all. Our congratulations and thanks go to the Sars - the SA Revenue Service - to the Treasury and the Department of Foreign Affairs and their officials for the work that has been done to bring us this far. I move these agreements that are before the House today. I thank you. [Applause.]
Debate concluded.
The DEPUTY CHAIRPERSON OF COMMITTEES: Thank you, Mr Durr. I am sure it was the first time, and probably the last time, that you have spoken for such a long time in the Chamber. [Laughter.]
I shall now put the question in respect of the Seventh Order. The question is that the report be agreed to. As this decision is dealt with in terms of section 65 of the Constitution, I shall first ascertain whether all the delegation heads are present in the Chamber to cast their provinces’ votes. It seems that they are all in. In accordance with Rule 71, I shall first allow provinces the opportunity to make their declarations of vote, if they so wish. There is none. We shall now proceed to the voting on the question. I shall do so in alphabetical order, per province. The delegation heads must please indicate to the Chair whether they vote in favour or against, or abstain from voting. Eastern Cape?
Ms N C KONDLO: iMpuma Koloni iyawusekela. [Eastern Cape supports.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Free State?
Mr T RALANE: Iyawesekela. [We support.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Gauteng? Ms D M RAMODIBE: We support it.
The DEPUTY CHAIRPERSON OF COMMITTEES: KwaZulu-Natal?
Ms B THOMSON: Supports.
The DEPUTY CHAIRPERSON OF COMMITEES: Limpopo?
Kgoshi L M MOKOENA: Iya seketela. [We support.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Mpumalanga?
Ms P M THEMBA. Mpumalanga iya wusekela. [Mpumalanga supports.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Northern Cape?
Mrs E N LUBIDLA: Northern Cape iyaxhasa. [Northern Cape supports.]
The DEPUTY CHAIRPERSON COMMITTEES: North West?
Mr Z S KOLWENI: North West ke wa rona. [North West supports.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Western Cape?
Mr K D S DURR: Die Wes-Kaap steun die verslag. [The Western Cape supports the report.]
The DEPUTY CHAIRPERSON OF COMMITTEES: All nine provinces voted in favour. I therefore declare the report agreed to. [Applause.]
I shall now put the question in respect of the Eighth Order. The question is that the report be agreed to. As the decision is dealt with in terms of section 65 of the Constitution, I shall ascertain whether delegation heads are present in the Chamber to cast their provinces’ votes. It seems that they are all in. In accordance with Rule 71, I shall first allow provinces the opportunity to make their declarations of vote, if they so wish. There is none. We shall now proceed to the voting on the question, and I shall do so in alphabetical order, per province. Please, delegation heads must indicate to the Chair whether they vote in favour or against, or abstain from voting. Eastern Cape?
Ms N C KONDLO: The Eastern Cape supports.
The DEPUTY CHAIRPERSON OF COMMITTEES: Free State?
Mr T RALANE: Iya seketela. [We support.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Gauteng?
Ms D M RAMODIBE: Gauteng supports.
The DEPUTY CHAIRPERSON OF COMMITTEES: KwaZulu-Natal?
Ms B THOMPSON: Siya vuma. [We support.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Limpopo?
Mr M I MAKOELA: Re a dumela. [We agree.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Mpumalanga? Ms M P THEMBA: Ri khou tendelana nayo. [We support.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Northern Cape?
Mrs E N LUBIDLA: Siya vuma. [We agree.]
The DEPUTY CHAIRPERSON OF COMMITTEES: North West?
Mr Z S KOLWENI: North West ke wa rona. [North West supports.]
The DEPUTY CHAIRPERSON OF COMMITTES: Western Cape?
Mr K D S DURR: Western Cape ke wa rona. [Western Cape supports.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Nine provinces have voted in favour. [Applause.] I therefore declare the report agreed to.
I shall now put the question in respect of the Ninth Order, the question being that the report be agreed to. Order! As the decision is dealt with in terms of section 65 of the Constitution, I shall first ascertain whether the delegation heads are present in the Chamber to cast their provinces’ votes.
In accordance with Rule 71, I shall first allow provinces the opportunity to make their declarations, if they so wish. Hon members, I don’t know whether you want us to continue or not, because I don’t think you are hearing what the Chair is saying here. If you could please listen to this, you know.
Ms B N SONO: Chairperson, I was rising on a point of concern. I am being harassed by these members. They are not even listening to what the Chairperson is saying. Thank you.
The DEPUTY CHAIRPERSON OF COMMITTEES: Thank you. We shall now proceed to the voting on the question. I shall do so in alphabetical order, per province, and the delegation heads must indicate to the Chair whether they are voting in favour or against, or abstaining from voting. Eastern Cape?
Ms N C KONDLO: Iyaxhasa. [We support.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Free State?
Mr T RALANE: We support.
The DEPUTY CHAIRPERSON OF COMMITTEES: Gauteng?
Ms D M RAMODIBE: Gauteng supports.
The DEPUTY CHAIRPERSON OF COMMITTEES: KwaZulu-Natal?
Ms B THOMSON: Siya vuma. [We agree.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Limpopo?
Kgoshi L M MOKOENAA: Iya seketela. [We support.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Mpumalanga?
Ms M P THEMBA: Mpumalanga supports.
The DEPUTY CHAIRPERSON OF COMMITTEES: Northern Cape?
Mrs E N LUBIDLA: Northern Cape supports.
The DEPUTY CHAIRPERSON OF COMMITTEES: North West?
Mr Z S KOLWENI: North West ke wa rona. [North West supports.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Western Cape?
Mr K D S DURR: Iyaxhasa. [We support.] [Applause.]
The DEPUTY CHAIRPERSON OF COMMITTEES: Nine provinces have voted in favour. I therefore declare the report agreed to. [Applause.]
I would now like to call upon the hon Deputy Chairperson, Mr Mahlangu. As requested, he would like to make a statement on the work of the working group on the OAU. I therefore call upon the Deputy Chairperson.
The DEPUTY CHAIRPERSON OF THE NCOP (Mr M J Mahlangu): Chairperson, in the 8th report which was tabled in the House, we reported that 21 member states had deposited their instruments of ratification. Today I am pleased to announce that 24 member states have deposited their instruments of ratification. Senegal actually deposited last week, but there are still many other countries that will do so.
This means that we have finally achieved the required simple majority of member states for the protocol to come into force. Our journey to realisation of the continental parliament is now a reality. What we need to work on is ensuring that we are ready to participate in the Pan-African Parliament. I am saying this because when we delivered the 8th report, we indicated that there is still a lot of work that needs to be done.
Amongst some of the issues which we will still have to finalise are the following: composition of the South African delegation; procedure for the election of the South African delegation; procedure for the election of the president and the four vice-presidents; and how do we ensure that South African delegates are held accountable, and also develop mechanisms for the structures for holding our delegates to the Pan-African Parliament accountable.
Now, let me begin with the first one, that is the composition of the South African delegation. As hon members are aware, the protocol provides that each country will be represented by five members. Furthermore, the delegation must include one woman and be a reflection of a diverse political composition of parliament. In our last report, we reported that the working group had recommended that South Africa would be represented by at least three women out of five members. I should also report that the working group had, in principle, agreed that in order to ensure that the South African delegation reflects the diversity of political opinions, the majority party would be represented by three members and the opposition parties by two members.
However, the challenge that we still have to deal with is, ``How do we ensure that the three women in the delegation also reflect the diversity of political opinions within Parliament?’’ It has been suggested that the majority party will nominate two women and that the opposition party should also at least nominate one woman and therefore that shows the diversity in terms of politics.
The second issue is the procedure. I should also report that the South African delegation will consist of four members from the National Assembly and one member from the National Council of Provinces. As members are aware, we do not have provisions that allow the two Houses to decide jointly. It is therefore imperative that each House meets to elect the five delegates. Presiding Officers have agreed that both Houses should elect the five delegates on Wednesday 26 November 2003, that will be the Wednesday before we rise for the festive season.
The protocol, in terms of the election of a presiding officer or what you call president and the four vice-presidents, provides that at its inaugural session, the Pan-African Parliament should elect the president and four vice-presidents who represent the five regions of Africa. These regions should not be mistaken with the economic blocks, as we know them today.
In terms of the OAU resolution, Africa has been divided into five regions, namely West Africa, with six member states; North Africa, with five member states; East Africa, with 13 member states; Central Africa, with nine member states; and Southern Africa, with 10 member states. So those are the five regions of the African Union.
The question to be finally resolved is whether those members who are elected to serve in the presidency and vice-presidency of the Pan-African Parliament should be replaced by other members from their countries once elected, or would they continue to represent their countries? That’s a question that we still have to debate and agree on. These are some of the challenges that all political parties should start to apply their minds to.
It is the view of the working group that the elected presiding officers should represent the interest of the Pan-African Parliament and, as such, the interests of the African continent. The question of our accountability also arises in terms of our delegation, especially. Now, this is an important aspect as to how do we ensure that the delegation that our Parliament will be sending to the Pan-African Parliament will be accountable, taking into account that in terms of the protocol they will be voting in their personal and independent capacity?
The working group has resolved that a joint ad hoc committee be established to prepare the members who will be going to the Pan-African Parliament which would be followed by a permanent structure that will ensure that members who represent our Parliament to the Pan-African Parliament are accountable. Now, that permanent structure would deal with the question of the mandates and reporting back, so that those mandates are being checked thoroughly as people are going there to represent the country, and so that they are clear about the mandate that they get from our Parliament.
Now, in order to avoid the disruption of the working group, it has been proposed that the working group would cease to exist once the joint ad hoc committee is established. Once a permanent structure is established, after the inauguration, the ad hoc committee would also cease to function and it would then be replaced by a permanent structure.
In conclusion, owing to the historic importance of the Pan-African Parliament, it has been agreed that its first inauguration would be held at the headquarters of the African Union, that is Addis Ababa in Ethiopia, and this will happen towards the end of January 2004. In order to ensure that all delegates of the Pan-African Parliament meet the requirements as outlined in the protocol, an accreditation committee will be set up to ensure that member states send delegates who comply with gender and political diversity, and also that no member of the executive forms part of the parliamentary delegation.
Lastly, let me take this opportunity to inform members that a report of the working group is tabled on the ATCs today, and that all members are urged to find time to read this report. We invite you for Monday afternoon, 3 o’clock, to fully brief you and have a discussion, as members of the Council, on the issues that are before the working group so that when we go to the working group, we would also have had some idea of what other members think. That input will assist us to take decisions as a working group when we meet. We will be meeting again on Tuesday next week. I thank you. [Applause.]
The CHAIRPERSON OF THE NCOP: Order! Thank you very much, Deputy Chairperson, for that important statement and briefing on the working group’s report. I hope members will attend the meeting on Monday afternoon.
The Council adjourned at 16:43. ____
ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS
WEDNESDAY, 19 NOVEMBER 2003
National Council of Provinces:
- The Chairperson:
The following members have been appointed to serve on the Mediation
Committee, namely:
Ackermann, Mr C Western Cape New NP
Bhengu, Mr M J KwaZulu-Natal IFP
Mokoena, Kgoshi M ILimpopo ANC
Nogumla, Mr R Z Eastern Cape ANC
Ramodibe, Ms D M Gauteng ANC
Setona, Mr T S Free State ANC
Sulliman, Mr M A Northern Cape ANC
Surty, Mr M E North West ANC
Tolo, Mr B J Mpumalanga ANC
NOTE: This list amends and replaces the list published in the
Announcements, Tablings and Committee Reports of Tuesday, 18 November
2003, in order to correct a few errors on that list.
- The Chairperson:
(a) Mr M E Surty has been elected co-chairperson of the Mediation
Committee with effect from 19 November 2003.
(b) Messages from National Assembly to National Council of
Provinces in respect of Bills passed by Assembly and transmitted to
Council:
(1) Bill passed by National Assembly on 19 November 2003 and
transmitted for concurrence:
(i) Telecommunications Amendment Bill [B 65B - 2003] (National
Assembly - sec 75)
The Bill has been referred to the Select Committee on Labour and
Public Enterprises of the National Council of Provinces.
TABLINGS:
National Assembly and National Council of Provinces:
Papers:
- The Minister of Public Enterprises:
Report and Financial Statements of Alexkor Limited for the financial
year ended June 2003, including the Report of the Independent Auditors
on the Financial Statements for the year ended June 2003.
COMMITTEE REPORTS: National Assembly and National Council of Provinces:
-
Report of the Joint Monitoring Committee on Improvement of Quality of Life and Status of Women, dated 26 September 2003:
The Joint Monitoring Committee on Improvement of Quality of Life and Status of Women, having considered the Report of the Independent Experts’ Assessment on Women, War and Peace (UNIFEM), reports that it endorses the recommendations contained in that Report, in particular the following:
-
The Secretary-General of the UN to give priority to achieving gender parity in his appointments of Special Representatives and Envoys beginning with the minimum of 30% in the next three years with a view to gender parity by 2015.
-
Gender equality to be recognised in all peace processes, agreements and transitional governance structures with a minimum of 30% representation of women in all negotiations.
-
Establishment of a United Nations Trust Fund for Women’s Peace- Building. The fund must be used to leverage political, financial and technical support needed for women’s civil society organisations and women leaders to have an impact on peace efforts. The Fund should be managed by UNIFEM, in consultation with other UN agencies.
- UNIFEM and the Department of Political Affairs (DPA) to ensure that gender issues and women’s full participation are incorporated in peace-building and post-conflict reconstruction. UNIFEM and UN Population Fund (UNFPA) to be represented in all relevant inter-agency bodies.
-
Peace Negotiations and agreements to have a gender perspective through the full integration of women’s concerns and participation in peace processes.
-
UN and donors to invest in women’s organisations as a strategy for conflict prevention, resolution and peace-building. They should exercise flexibility in responding to urgent needs, time-sensitive opportunities, and foster partnerships and networks between international, regional and local peace initiatives.
-
National electoral laws and international electoral assistance to establish quotas to achieve gender parity, ensure voter registration, education and increase in the ratio of women in electoral commissions and observer missions and to provide training for women candidates.
-
A lead organisation to be designated within the United Nations for women’s education and training in conflict and post- conflict situations. This lead organisation, together with UNESCO, UNHCR and UNICEF, should ensure that all education programmes for displaced persons provide for women, as well as girls.
-
The International Labour Organization (ILO) to expand vocational and skills training for women in post-conflict situations, including in non-traditional, public and private sectors, in a manner that is sustainable and responsive to the local and national economy. Additional recommendations by Committee:
-
That a regional TRC structure on violence against women in armed conflict for women in Africa be established within the African Union and that it be linked to the International Truth and Reconciliation Commission on violence against women in armed conflict under the United Nations, as proposed in the UNIFEM report, as a step towards ending impunity. The continental structure should, however, model a joint government and civil society initiative.
-
Further, decreasing domestic violence should be a criterium against which countries will be reviewed in the African Peer Review Mechanism process.
- That a Council for African women mediators be established, comprising women who are not in active formal politics and who will be available and who may be utilised as special envoys and who, as a council, will have a special status with the Peace and Security Council.
-
That training workshops be facilitated for empowering African women with conflict analysis, negotiation, mediation and leadership skills.
-
That relations with the DRC, Rwanda and Burundi be strengthened.
-
That a delegation of women leaders be sent to Burundi and the DRC to work towards facilitating lasting peace.
-
That a mission of three women leaders from each of the Great Lakes countries and South Africa be constituted to support international efforts for establishing peace in the Great Lakes Region.
- That the Peace and Security Council of the African Union be engendered with immediate effect.
-
Report to be considered. National Council of Provinces:
-
Report of the Select Committee on Education and Recreation on the Higher Education Amendment Bill [B 36 - 2003] (National Assembly - sec 75), dated 18 November 2003:
The Select Committee on Education and Recreation, having considered the subject of the Higher Education Amendment Bill [B 36 - 2003] (National Assembly - sec 75), referred to it, reports that it has agreed to the Bill.
-
Report of the Select Committee on Education and Recreation on the Education Laws Amendment Bill [B 38B - 2003] (National Assembly - sec 76), dated 18 November 2003:
The Select Committee on Education and Recreation, having considered the subject of the Education Laws Amendment Bill [B 38B
- 2003] (National Assembly - sec 76), referred to it, reports the Bill with amendments [B 38C - 2003].
-
Report of the Select Committee on Finance on the Local Government: Municipal Finance Management Bill [B 1B - 2002] (National Assembly - sec 75), dated 18 November 2003:
The Select Committee on Finance, having considered the subject of the Local Government: Municipal Finance Management Bill [B 1B - 2002] (National Assembly - sec 75), referred to it, reports the Bill with proposed amendments, as follows:
INSERT ATC1911.DOC
THURSDAY, 20 NOVEMBER 2003
ANNOUNCEMENTS:
National Assembly and National Council of Provinces:
- The Speaker and the Chairperson:
(1) The Joint Subcommittee of the Joint Programme Committee on 20
November 2003 took a decision, in accordance with Joint Rule
216(2), that the Electoral Laws Second Amendment Bill [B 73 -
2003] (National Assembly - sec 75) be fast-tracked by, where
necessary, dispensing with any relevant House Rule or Joint Rule
and shortening any period within which any step in the legislative
process relating to the Bill must be completed, in order to make
it possible for the Bill to be passed by 28 November 2003.
In terms of Joint Rule 216(4), this decision must be tabled in
both Houses for ratification.
- Introduction of Bills:
(1) The Minister of Home Affairs:
(i) Electoral Laws Second Amendment Bill [B 73 - 2003]
(National Assembly - sec 75)
Introduction and referral to the Portfolio Committee on Home
Affairs of the National Assembly, as well as referral to the Joint
Tagging Mechanism (JTM) for classification in terms of Joint Rule
160, on 21 November 2003.
In terms of Joint Rule 154, written views on the classification of
the Bill may be submitted to the Joint Tagging Mechanism (JTM)
within three parliamentary working days.
- Bills passed by Houses - to be submitted to President for assent:
(1) Bill passed by National Assembly on 20 November 2003:
(i) National Environmental Management Amendment Bill [B 29 -
2003] (National Council of Provinces - sec 76)
National Council of Provinces:
- Messages from National Assembly to National Council of Provinces in respect of Bills passed by Assembly and transmitted to Council:
(1) Bill passed by National Assembly on 20 November 2003 and
transmitted for concurrence:
(i) Protection of Constitutional Democracy against Terrorist
and Related Activities Bill [B 12B - 2003 (Reprint)] (National
Assembly - sec 75) (introduced as Anti-Terrorism Bill [B 12 -
2003]
The Bill has been referred to the Select Committee on Security and
Constitutional Affairs of the National Council of Provinces.
(2) Bill, as amended, passed by National Assembly on 20 November
2003 and transmitted for consideration of National Assembly's
amendments:
(i) National Environmental Management: Biodiversity Bill [B
30D - 2003] (National Council of Provinces - sec 76)
The amended Bill has been referred to the Select Committee on Land
and Environmental Affairs for a report and recommendations on the
National Assembly's amendments.
TABLINGS:
National Assembly and National Council of Provinces:
Papers:
- The Minister of Finance:
Government Notice No R1454, published in Government Gazette No 25557,
dated 8 October 2003: Regulations: Procedures for submitting returns in
electronic format and requirements for electronic signatures in terms
of the Income Tax Act, 1962 (Act No 58 of 1962).
- The Minister of Trade and Industry:
Report and Financial Statements of Proudly South African for 2002-2003,
including the Report of the Independent Auditors on the Financial
Statements for 2002-2003.
- The Minister for Justice and Constitutional Development:
Government Notice No R1593, published in Government Gazette No 25637,
dated 31 October 2003: Regulations: Judicial Officers in Lower Courts,
1994: Amendment in terms of the Magistrates Act, 1993 (Act No 90 of
1993).
National Council of Provinces:
- The Chairperson:
The following statement has been submitted to the National Council of
Provinces by the MEC for Local Government, Traffic Control and Traffic
Safety in Mpumalanga under section 106(3) of the Local Government
Municipal Systems Act, 2000 (Act No 32 of 2000):
Investigation in terms of section 106(1)(b) of the Local
Government: Municipal Systems Act, 2000 (Act No 32 of 2000) into
allegations of fraud, corruption, maladministration and other
irregularities at the Gert Sibande Municipality.
The statement is referred to the Select Committee on Local Government
and Administration.
Copies of the statement are available at the Office of the Clerk of the
Papers.
COMMITTEE REPORTS:
National Assembly and National Council of Provinces:
-
Report of the Mediation Committee on the Liquor Bill [B 23B and B 23D - 2003] (National Assembly - sec 76), dated 19 November 2003:
The Mediation Committee, having considered the Liquor Bill [B 23B and B 23D - 2003] (National Assembly - sec 76), as well as the papers referred to it, reports as follows:
-
The Liquor Bill [B 23B - 2003] (National Assembly - sec 76) was passed by the National Assembly on 21 August 2003 and submitted to the National Council of Provinces for approval.
- The National Council of Provinces passed the Liquor Bill [B 23D
- 2003] (National Assembly - sec 76) on 8 October 2003, containing a number of amendments agreed to by the Select Committee on Economic and Foreign Affairs.
-
Upon referral of the latter amended Bill to the National Assembly, that House accepted some of the amendments passed by the National Council of Provinces, with the exception of Clause 6(2) of the Bill. Consequently, the National Assembly rejected the Bill.
-
The Bill was referred to the Mediation Committee on 18 November 2003 in terms of Joint Rule 186(1)(b) of the Joint Rules of Parliament. The Mediation Committee met on 19 November 2003, and, after deliberation, agreed to submit another version of the Bill.
-
The effect of this decision is that the Secretary to Parliament is required to submit the latter version of the Bill to both the Speaker and the Chairperson of the Council in terms of Joint Rule 188(3), for consideration by the House and the Council.
- The Committee therefore submits the Liquor Bill [B 23F - 2003] (National Assembly - sec 76), and recommends that the House and the Council pass this mediated version.
-
-
Report of the Joint Standing Committee on Intelligence, dated 5 November 2003:
The Joint Standing Committee on Intelligence, having met on 5 November 2003, wishes to report as follows:
The Committee welcomes the appointment of the Hefer Commission. However, the Committee views with alarm and serious concern the issuing of subpoenas by the Hefer Commission to South Africa's Intelligence and Security Services compelling them to provide classified and/or sensitive information that will purportedly serve the Commission's purpose. Ignoring the provisions of the law relating to national security in order to satisfy the objectives of the Hefer Commission will have serious consequences for South Africa, both domestically and internationally. The role of the Committee, amongst other things, is to ensure that South Africas' Intelligence and Security Services protect and preserve the country's national security, the defence of the Republic and the investigation, combating of crime and the protection of classified and/or sensitive information in their possession. It is a universally accepted principle that information in the possession of the Intelligence Services cannot be made public. This includes especially the names of sources, agents, operatives and identities of members. The Committee therefore supports the position of the Intelligence Services as presented to the Hefer Commission. We believe that the Intelligence and Security Services should not be embroiled in this matter and that those who have brought the matter into the public domain, should provide the basis for their allegations to be tested by the Commission without causing databases and files of the Intelligence and Security Services to be inspected at great risk to the Constitutional mandate of these structures.
National Council of Provinces:
-
Report of the Select Committee on Security and Constitutional Affairs on the United Nations Convention against Transnational Organised Crime, dated 19 November 2003:
The Select Committee on Security and Constitutional Affairs, having considered the request for approval by Parliament of the United Nations Convention against Transnational Organised Crime, referred to it, recommends that the Council -
-
approve the said Convention in terms of section 231(2) of the Constitution;
-
confirm that the Director-General of the Department of Justice and Constitutional Development, to whom foreign requests for assistance in terms of section 7 of the International Co- operation in Criminal Matters Act, 1996 (Act No. 75 of 1996), is submitted, be designated as the South African Central Authority to receive requests for mutual legal assistance in terms of article 18(13) of the Convention. In addition, approve that requests shall be made in the English language as provided for in article 18(14) of the Convention; and
-
approve that the Republic of South Africa, in line with her previous position, when ratifying United Nations multilateral treaties, enter a reservation against the compulsory jurisdiction of the International Court of Justice (ICJ) with regard to settlement of disputes arising out of the interpretation or application of the Convention as provided for in article 35(3) of the Convention. The Republic of South Africa does not recognise the compulsory jurisdiction of the ICJ as provided for in article 36 of the Statute of the ICJ. The reservation, in line with our previous position stated above, has been formulated as follows:
"Pending a decision by the Government of the Republic of South Africa on the compulsory jurisdiction of the International Court of Justice, the Government of the Republic does not consider itself bound by the terms of article 35(2) of the Convention which provides for the compulsory jurisdiction of the International Court of Justice in differences arising out of the interpretation or application of the Convention. The Republic will adhere to the position that, for the submission of a particular dispute for settlement by the International Court, the consent of all the parties to the dispute is required in every individual case." Report to be considered.
-
-
First Report of the Select Committee on Security and Constitutional Affairs on the Protocol to Prevent, Suppress and Punish Trafficking in Persons, especially Women and Children, supplementing the United Nations Convention against Transnational Organised Crime, dated 19 November 2003:
The Select Committee on Security and Constitutional Affairs, having considered the request for approval by Parliament of the Protocol to Prevent, Suppress and Punish Trafficking in Persons, especially Women and Children, supplementing the United Nations Convention against Transnational Organised Crime, referred to it, recommends that the Council -
-
approve the said Protocol in terms of section 231(2) of the Constitution; and
-
approve that the Republic of South Africa, in line with her previous position, when ratifying United Nations multilateral treaties, enter a reservation against the compulsory jurisdiction of the International Court of Justice (ICJ) with regard to settlement of disputes arising out of the interpretation or application of the Protocol as provided for in article 15(3) of the Protocol. The Republic of South Africa does not recognise the compulsory jurisdiction of the ICJ as provided for in article 36 of the Statute of the ICJ.
The reservation, in line with our previous position stated above, has been formulated as follows:
"Pending a decision by the Government of the Republic of South Africa on the compulsory jurisdiction of the International Court of Justice, the Government of the Republic does not consider itself bound by the terms of article 15(2) of the Protocol which provides for the compulsory jurisdiction of the International Court of Justice in differences arising out of the interpretation or application of the Convention. The Republic will adhere to the position that, for the submission of a particular dispute for settlement by the International Court, the consent of all the parties to the dispute is required in every individual case."
-
Report to be considered.
-
Second Report of the Select Committee on Security and Constitutional Affairs on the Protocol to Prevent, Suppress and Punish Trafficking in Persons, especially Women and Children, supplementing the United Nations Convention against Transnational Organised Crime, dated 19 November 2003:
The Select Committee on Security and Constitutional Affairs, when considering the request for approval by Parliament of the Protocol to Prevent, Suppress and Punish Trafficking in Persons, especially Women and Children, supplementing the United Nations Convention against Transnational Organised Crime, referred to it, noted that at present there is no current legislation to deal with the criminalisation of the trafficking in persons in terms of article 5 of the said Protocol.
Therefore, the Committee recommends that the Council approve that Government responds as to the action that is being taken to comply with the obligations dealing with the criminalisation of the trafficking in persons as required in terms of the said Protocol, within three months of the passing of this resolution.
Report to be considered.
-
First Report of the Select Committee on Security and Constitutional Affairs on the Protocol against the Smuggling of Migrants by Land, Sea and Air, supplementing the United Nations Convention against Transnational Organised Crime, dated 19 November 2003:
The Select Committee on Security and Constitutional Affairs, having considered the request for approval by Parliament of the Protocol against the Smuggling of Migrants by Land, Sea and Air, supplementing the United Nations Convention against Transnational Organised Crime, referred to it, recommends that the Council -
- approve the said Protocol in terms of section 231(2) of the Constitution;
-
approve that the Director-General of the Department of Transport be designated as an authority to receive and respond to requests for assistance. In addition, approve that the Director-General of the Department of Transport will be complemented by the South African Maritime Safety Authority (SAMSA), the Department of Home Affairs, the South African Police Service and the South African National Defence Force; and
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approve that the Republic of South Africa, in line with her previous position, when ratifying United Nations multilateral treaties, enter a reservation against the compulsory jurisdiction of the International Court of Justice (ICJ) with regard to settlement of disputes arising out of the interpretation or application of the Protocol as provided for in article 20(3) of the Protocol. The Republic of South Africa does not recognise the compulsory jurisdiction of the ICJ as provided for in article 36 of the Statute of the ICJ.
The reservation, in line with our previous position stated above, has been formulated as follows:
"Pending a decision by the Government of the Republic of South Africa on the compulsory jurisdiction of the International Court of Justice, the Government of the Republic does not consider itself bound by the terms of article 20(2) of the Protocol which provides for the compulsory jurisdiction of the International Court of Justice in differences arising out of the interpretation or application of the Convention. The Republic will adhere to the position that, for the submission of a particular dispute for settlement by the International Court, the consent of all the parties to the dispute is required in every individual case."
Report to be considered.
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Second Report of the Select Committee on Security and Constitutional Affairs on the Protocol against the Smuggling of Migrants by Land, Sea and Air, supplementing the United Nations Convention against Transnational Organised Crime, dated 19 November 2003:
The Select Committee on Security and Constitutional Affairs, having considered the request for approval by Parliament of the Protocol against the Smuggling of Migrants by Land, Sea and Air, supplementing the United Nations Convention against Transnational Organised Crime, referred to it, noted that at present there is no current legislation to deal with the criminalisation of the smuggling of migrants in terms of article 6 of the said Protocol.
Therefore, the Committee recommends that the Council approve that Government responds as to the action that is being taken to comply with the obligations dealing with the criminalisation of the smuggling of migrants as required in terms of the said Protocol, within three months of the passing of this resolution.
Report to be considered.
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Report of the Select Committee on Security and Constitutional Affairs on the Protocol against the Illicit Manufacturing of and Trafficking in Firearms, their Parts and Components and Ammunition, supplementing the United Nations Convention against Transnational Organised Crime, dated 19 November 2003:
The Select Committee on Security and Constitutional Affairs, having considered the request for approval by Parliament of the Protocol against the Illicit Manufacturing of and Trafficking in Firearms, their Parts and Components and Ammunition, supplementing the United Nations Convention against Transnational Organised Crime, referred to it, recommends that the Council -
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approve the said Protocol in terms of section 231(2) of the Constitution;
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approve that the National Commissioner of the South African Police Service be designated to liaise with other States Parties on matters relating to the Protocol as required by article 13(2) of the said Protocol; and
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approve that the Republic of South Africa, in line with her previous position, when ratifying United Nations multilateral treaties, enter a reservation against the compulsory jurisdiction of the International Court of Justice (ICJ) with regard to settlement of disputes arising out of the interpretation or application of the Protocol as provided for in article 16(3) of the Protocol. The Republic of South Africa does not recognise the compulsory jurisdiction of the ICJ as provided for in article 36 of the Statute of the ICJ.
The reservation, in line with our previous position stated above, has been formulated as follows:
"Pending a decision by the Government of the Republic of South Africa on the compulsory jurisdiction of the International Court of Justice, the Government of the Republic does not consider itself bound by the terms of article 16(2) of the Protocol which provides for the compulsory jurisdiction of the International Court of Justice in differences arising out of the interpretation or application of the Convention. The Republic will adhere to the position that, for the submission of a particular dispute for settlement by the International Court, the consent of all the parties to the dispute is required in every individual case."
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Report to be considered.
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Report of the Select Committee on Security and Constitutional Affairs on the Protocol on Southern African Development (SADC) Tribunal, dated 19 November 2003:
The Select Committee on Security and Constitutional Affairs, having considered the request for approval by Parliament of the Protocol on Southern African Development (SADC) Tribunal, referred to it, recommends that the Council, in terms of section 231(2) of the Constitution, approve the said Protocol.
Report to be considered.
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Report of the Select Committee on Security and Constitutional Affairs on the Agreement amending the Protocol on Southern African Development (SADC) Tribunal, dated 19 November 2003:
The Select Committee on Security and Constitutional Affairs, having considered the request for approval by Parliament of the Agreement amending the Protocol on Southern African Development (SADC) Tribunal, referred to it, recommends that the Council, in terms of section 231(2) of the Constitution, approve the said Agreement.
Report to be considered.