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Parliament updated on SOE finances

…..article dated 25 August 2020……

DPE presents bleak picture…. 

As part of a portfolio committee meeting covering the status of the seven SOEs under the umbrella of the Department of Public Enterprises (DPE), new director general,  Khathatso Tlhakudi,  provided a sombre picture of the current financial malaise within the SA public sector.  However. he ended up on a more positive note with regard to Denel and SAA.    On Eskom, he said,  he would make some comment but as they were reporting on a regular basis to Parliament, he said he would not report in great depth.

On Denel, he commented that he had “a good feeling that acting CEO Talib Sadik would hold the situation until a new CEO was appointed”, saying that “we need Denel for strategic reasons”.  He said that Sadik had the necessary enthusiasm and  drive to hold the fort.

As far as SAA was concerned, DPE “had made good progress with a business rescue plan which had now been approved” which fact  he claimed was “a major milestone after what had happened beforehand”. Now it was just a question if support could be found for the plan.

Outside Eskom

Tlhakudi commented that a good deal of the problem at Eskom, other than the specifics of state capture, was that most of the municipalities were not investing adequately in their distribution networks which he said were “falling apart at the nation’s expense”.

On electricity distribution “much of the problem could be put down to bad town planning”, he said.  “As a result of an inability to provide a proper  “pay as you go” service, informal settlements had simply connected themselves to the network, resulting in overloading and continual damage.”

Another issue was that councils should not just collect rates from communities but had to also invest in those communities. Consumer attitudes had to change, Tlhakudi said. Eskom was not in a position to subsidise non-payment in infrastructure, he said. “Responsible management is called for at community level and consumer attitudes have to change”.  He looked to CoGTA to assist in bring such changes about, as well as  the departments of Human Settlements, Water & Sanitation and Public Works to play their roles more purposefully.

Not all bad

DG Tlhakudi said that an infusion of new thinking had started at DPE.  “New ideas are emerging, he said. Great progress had been made with the ports; business was flowing well through the Maputo Corridor with the export of exporting magnetite; and activities around wine and fresh produce were getting some good numbers, ” he listed.  “The story at Transnet is coming right and the Trade and Industry Committee will be impressed, despite the problems of COVID”.

He concluded that DPE was in the process of finding new ways to intervene and assist timeously in SOE and departmental problems and cut short any drift towards malfeasance and corruption with intervention from the top, on an immediate response basis.

Overview of the SOE seven

In an overview of the DPE portfolio, Ms Jacky Molisane of DPE  took MPs through the sorry picture.

In alphabetical order, she recounted that (1) Alexkor, a diamond mining business and which has been attempting to establish a diamond polishing venture down the line, had reported a loss in the 2019/2020 financial year of R63m. This was in part due to low diamond prices, not helped by corruption at management level at its mine. Its cash reserves will be depleted by September and DPE.  Furthermore, its head office is being wound down.

Denel (2), which had been in the newspapers a lot this month with attempts to save the entity for its strategic value, reported a loss of R1.7bn for the 2019/20, its equity being well below the level of R4bn required as a going concern for investors. This, despite a R1.8bn funding in the year under review.  Ms Molisane said that R576m allocated for the 2020/21 has not been passed on by DPE at this stage, since the impact of COVID-19 had resulted in more strain for Denel, the position now being fluid. An acting CEO was currently holding the fort.

Simple facts

As far as Eskom (3) was concerned, Ms Molisane, giving a short picture, saying the simple facts were that any increase in revenue would purely be mainly reflected as due to increases in electricity tariffs.  Although cash from operations might be increasing, Ms Molisane said, earnings before interest, taxes, depreciation, and depreciation were never going to be sufficient to cover increasing costs.  DPE and the taxpayer, as the shareholder, were not receiving a return on investment and the entity was a serious drain on the economy.

South African Forestry Company (4) had reported a loss of R47m for the year under review, mainly as a result of the decline in revenue and high operating expenses. A fair value adjustment saved the company from worse figures and Safcol badly needs re-investment in its equipment and operations.

South African Airways (5) has been under business rescue since December 2019 due to its declining performance and now the inability to pay its debts as they fall due.   A business rescue plan was approved in July 2020 by all creditors. Various options for raising funds were now being carried with the assistance of RMB as transaction advisor, Ms Molisane said. There was every hope that a partner would be found before 17 September.

Old story, old routes

On SAA, DG Khathatso Tlhakudi added the fact said the Department had brought in “some of the best brains, working together linked around the world to help it implement a plan mainly people who understood the airline industry.” Once a strategy was implemented for SAA, he said, DPE would be looking, first for a feeder network to sustain the airline, and then a decision was to be made as to the best way forward to recover routes.    Right now, “effort is being applied to help SAA out of the situation it found itself in”.

SA Express (6) was placed under business rescue in February 2020, Ms Molisane said, but a credible business plan was not found and liquidators called in.   With little likelihood that any expression of interest will be shown, SA Express could be liquidated at the end of September this year.

Ms Molisane then quickly touched on Transnet (7) where revenue had grown marginally by 3% to R75bn for the 2019/20 year under review but decline in demand is expected for the coming year due to COVID-19 and lockdown circumstances. Revenue at an expected figure of R78bn for 2020/21 therefore looked very unlikely. Given that Transnet would eventually get over the COVID setback, Molisane’s figures indicated a possible break-even point in the near future.

Dartboard

For three quarters of an hour, MPs from across party lines criticised DPE for its handling of a situation over the months preceding, a period in which in their view things had been allowed to get totally out of hand.    It was pointed our , however, by the DPE team that it was the system of government that was at fault as the individual boards ran the SOEs and there was a limit to which DPE could interfere.

Point after point was raised, eventually leading to a relatively sensible overview from Ghalib Cachalia (DA) who calculated that the seven SOEs were the major debt trap that had cumulatively led South Africa into its present sad state, whilst also being the home of state capture. Cachalia told DPE that they had to go about things differently, and very soon.

Action now

With a warning that SA was  “falling off the fiscal cliff”, Cachalia remarked that “tinkering around with balance sheets and expenses was getting the country nowhere” and that some new management concepts “were needed and needed urgently”.  The objectives of DPE were “to lead with vision a stable of state entities that led South Africa into new territory and uplifted the poor”. Quite the reverse was happening, he said.

Sibusiso Gumede (ANC) said the quagmire that DPE found itself in was contributed to by the inability state to intervene at any particular point, having to deal with a balance sheet problem well after the event.        He said, “Whilst it is commendable that DPE itself has shown good performance, it had to start running ‘good’ SOEs as well.  He said, “One cannot have an excellent department running ‘bad’ SOEs and we cannot have business as usual any more’.

Eskom starts internal overhaul – ParlyReportSA

Posted in Agriculture, Electricity, Finance, economic, Mining, beneficiation, Public utilities, public works, Trade & Industry, Transport0 Comments

Employment Equity Bill sets BEE targets

…..article July 26….

Minister gets tough on B-BBEE…. 

At the same time as Minister of Employment and Labour, Thulas Nxesi, tabled in Parliament the new Employment Equity (EE) Amendment Bill proposing that new BEE targets for business and industry should be set, the Department of Labour (DoL) appears to be acting as if the legislation is already in place.

Already government has been making overtures to the public in general on what the employment changes will be and how they will be implemented giving full details of the proposed outcomes of the parliamentary process.

This is all happening before Parliament can even meet to debate the Bill, both the Department of Labour and the Commission for Conciliation, Mediation and Arbitration (CCMA), recently announcing in a joint statement that that they  have teams touring the country to educate the public “on the new amended labour law processes and targets involved”.

Hold on

Opposition parties have objected to such premature announcements, stating that such a move will only hurt further an already troubled investment climate.    DA leader John Steenhuizen has stated that the setting of targets and quotas is “racial bean counting” and has queried the constitutionality of such proposals, even if they are set “after discussion with industry sectors”.

After nearly three years of beating about the bush with a draft Bill for discussion, its sudden tabling in final form would seem to come at a most inopportune time.   Commentators note that business morale is understandably low in the light of COVID 19 restrictions, unemployment figures are at the worst since the Great Depression and any new investment is only on a distant horizon.

Low punch

It is also difficult  to understand why Cabinet would chose this particular time to damage even any fertile territory for investors wishing to buy in at the bottom of the opportunity curve.   Some worry that the persistent clash over labour policy in the upper echelons of the governing party maybe to blame for its sudden introduction, the Bill being tabled just as Parliament was closing for a short recess.

The heavy-handed approach appears to be an attempt to use the parliamentary majority to rubber stamp what the COSATU power base has always wanted  from NEDLAC negotiations on BEE outcomes. The route was chosen some eight years ago by the trade union movement and to many the EE Amendment Bill is merely part of a pre-destined process.

Even major businesses, banks and mining houses, reading between the lines, seem to have accepted the Bill’s inevitability and seem also to have been mesmerised into the  acceptance of a status quo governed by agreed targets and have agreed also with Minister Nxesi that that such are not “quotas”.

The DA disagrees and calls the target proposals “racial”.  From the perspective of inequality in the workplace, the EE Bill will also bring in mandatory training of employees, meaning that companies will have to focus on their training and development which the mining companies have already accepted publicly in statements. They note to their members in a circular that they will not get government business unless they meet both the employment “targets” and get certification on the new training requirements.

 War talk

“We are not waiting for this Bill and the process has started already,” said soft-spoken Thembinkosi Mkhaliphi, Director of Labour Relations and top man in government as the draft Bill went up on the DoL website.

Nice guy that he is most of the time, Mkhaliphi is fully aware that the well-known quartet of laws, the Basic Conditions of Employment Amendment Act, the Labour Relations Amendment Act the Employment Services Act ,and the soon-to-be, it appears, the Employment Equity Amendment Act is all that it is needed to tame the private sector on any labour matter, particularly if either quotas or targets are legalized.

To many in the older generation, putting people into quotas is one short of putting then into cattle trucks and calling them “targets” is merely the use of synonyms.

One realizes that the mining industry is wearisome after some five years of argument with such obdurate politicians as the past minister of mining, Zuma’s Mosebenzi Zwane.  Probably, and understandably so, mining captains wish to get on and at least get back to mining whatever the labour environment, accepting that compulsory training is certainly morally acceptable.

Racial facts

Whatever the current situation is, an explosive report suddenly appeared recently in the labour environment. A report of the Commission for Employment Equity (CEE) showed that after 20 years whites still dominate top management positions in the private sector.  In top management, 65.5% of positions are held by whites, 15% by Africans, 5.3% by coloured persons and 9.7% by Indians.   This ammunition was devoured by the labour camp and shortly after that, the EE Bill was tabled.

The final results of the discussions between all parties apparently is that the new Bill gives the Minister the authority to set employment equity targets for employers across the economy; that the wording of the Bill proposes fines of up to 10% of turnover for failure to meet gazetted targets, with the State having the powers to disqualify firms from “working with government” for failure.

Enough said

The department has said the targets will be set at sectoral level after consultation with business and it will be up to companies to implement these according to conditions laid down in the Bill. “A company that does not meet the target must have a justifiable reason. If it does not, then it is not in compliance with the law.”

In terms of timing, using the law would seem to be the final route taken by the Department of Labour as the only way the CEE figures as published can be changed.

For Tembinkosi Mkhaliphi, also previously acting director at NEDLAC, this is the end of a long journey and the beginning of a new adventure.   When asked by Business Day, during an interview at NEDLAC in 2019, whether NEDLAC was relevant to the labour movement, he answered that indeed it was.

“The issue of the national minimum wage and the strike ballot and the amendment of the Basic Conditions of Employment Act were all implemented at NEDLAC” he said, endorsing apparently the value of the entity to both himself and COSATU.

Railway line

Looking back, the EE Bill  indeed began its journey twenty years ago in draft form at NEDLAC.  In 2003, President Mbeki, in his opening address to the National Assembly in February 2003, said that legislation would be finalised for a strategy for Broad-Based Black Empowerment, which was the formalisation of partnerships and ‘charters’ with the private sector the use of a ‘balanced scorecard’ approach to gauging success.

Everybody got to work, and redress was not only found acceptable but necessary.   Now, in 2020, things are to change further, says Minister Nxesi in his Bill, but this must be in the knowledge that argument is bound to arise that whilst human rights treaties endorse the redress measures as promoted by B-BBEE,  whether to enforce black empowerment at law with targets is acceptable.

Latest moves

In a virtual  interview last week, in a well-tempered and firm tone,  “It is recognised that B-BBEE was operated on the premise that there should be no involvement of government enforcing transformation in terms of target setting and it had left it to companies themselves to set their own targets and goals”, he said, “but we have got nowhere”.

He continued, looking straight at his camera,” It has been government’s role to monitor these targets over the last 21 years but nothing has happened that should have happened and no real significant change has taken place”,  inferring that the Minister’s Bill would do this.

The other side

Martin Kingston, vice-president of Business Unity SA, has said on the side lines that the Bill has been two years in the making and that business will indeed be involved in setting targets. “The Minister has to consult with each sector and the consultation process leads to agreeing targets, which go to NEDLAC, a process that is already currently underway with retail and mining”.

No doubt, Parliament will allow for hearings in the new session starting 18 August and full details of BUSA’s view will be expressed although they will obviously be happy with concessions given to small business.

The DA’s shadow minister of labour, Michael Cardo, has been more vocal, stating, “This Bill will have the effect of choking SA’s barely breathing economy and its will  be opposed tooth and nail. These numerical targets imposed by ministerial fiat are quotas in all but in name.  The minister has no business in ramming them down the throat of employers.”

Next stage

Tembinkosi Mkhaliphi has repeated in a subsequent virtual media briefing that consultations on the new amending Bill, then still a draft, had already been conducted with the mining, banking and retail sectors. He did not elaborate on the responses, however.

The Bill does, however, propose the reduction in regulatory burden upon small employers, since those with less than 50 employees will no longer have to report on their employment equity targets, irrespective of their turnover, Mkhaliphi said .

He put forward a different view. He said that with B-BBEE, “target setting is not new except that now government comes into the picture”.   It’s a question of give and take, he said, admitting that the proposal in the Bill to lessen the burden on small business “was to sweeten the carrot”.

Kicking it along

Mkhaliphi said in conclusion that he realised “not everyone at NEDLAC was happy with the Bill.”

Indeed, it does seem, from a parliamentary viewpoint, a total contradiction that in the light of President Cyril Ramaphosa’s recent commitment that government was making “structural economic reforms that will ease regulations for investors”, that the Cabinet has now approved a Bill for tabling in Parliament which raises the bar by a whole number of regulation notches – and difficult ones at that.

The Bill will now be scheduled for meetings into the next session of Parliament to commence mid- August.

Posted in Agriculture, BEE, Finance, economic, Justice, constitutional, Labour, Trade & Industry0 Comments

FFC: budget cuts may worsen service delivery

….article dated 20 July 2020…. 

Balance between needs and cuts required…. 

The Financial and Fiscal Commission (FFC), the independent body which reports to Parliament on intergovernmental financial relations (IGFR) in terms of the Constitution, has told MPs of its deep concern that Minister Mboweni’s budget cuts, announced in the Supplementary Budget Bill, may adversely affect the ability of local government to manage service delivery commitments in the coming year.

FFC manager for fiscal policy, Eddie Rakabe, is also concerned that National Government has not given guidance to provinces and local municipalities on IGFR matters and how they should reprioritise their budgets after having chopped them.

Help down the line

Whilst acknowledging the reasons for the cuts because of the unforeseen pandemic, he called for government to recognise that a delicate balance has to be struck between expenditure reduction and the meeting of basic needs. On top of this, the Minister had asked all parties to switch to zero-budgeting  which may not be understood or implemented properly.

FFC Chairperson, Prof Daniel Plaatjies, acknowledged that an adjustment Budget by Minister Mboweni was necessary to mitigate the downsides of responding to the COVID-19 crisis but FFC’s main point was that in making Budgetary adjustments in such a short period of time, it was going to be extraordinarily difficult for all to produce new frameworks that were growth enhancing.

Not how much but how

Eddie Rakabe told parliamentarians that their comments were somewhat critical in the light of the Minister indicating that about R230bn in expenditure will have to be cut over the next two years which appeared drastic and care had to be exercised.

The FFC advises, he said, that a delicate balance must be struck between expenditure reduction and the meeting of basic needs. He was insistent that as expenditure is reduced, there had to be a plan to ensure that critical social services are not compromised.

The constitutional criteria in any Budget consideration had to be on the basis of spending where the basic rights of people are protected, Rakabe noted.  In this respect, the reprioritisation proposed by the supplementary Budget in the view of FFC complied with this criterion, he said.  However, the FFC was deeply concerned about the absence of a framework to guide provincial reprioritisation as a process — provinces having to do the reprioritisation on their own.

A little left and a little right

FFC agreed with the Parliamentary Budget Office, who had reported in the same meeting beforehand, that it was going to take a lot to get South Africa back to its pre COVID-19 position, which was not very strong in any case and the situation was fraught with the threat of collapse of social security plans.

Eddie Rakabe said, “We agree with the Minister that SA’s sovereign credit rating is a major concern since credit rating downgrades affect government’s ability to meet borrowing requirements and that to raise revenue from tax to meet social needs just because of the overwhelming need to meet debt servicing costs is not correct.

All the same, he said, the proposals needed much more care in application. Conditional grants had to be the main focus and whether there was a complete necessity for each.

 All too fast

FFC recommended that government reconsider the sequencing of the phases for managing the Covid 19 pandemic.    It was essential that capacity of provincial and local government treasuries be strengthened to ensure that they promote spending control and enhance spending effectiveness, they considered.

The FFC acknowledged the zero-based budgeting announcement but Rakabe said that he still remained most concerned about the effectiveness of changing the budget structure and the way things had been done for years so suddenly.  He said time and resources were necessary to “ operationalise zero-based budgeting” properly.

Hamba gahle

He warned that there are “a whole lot of issues that need sorting out before  moving full steam ahead with such a complicated financial concept being endorsed for all levels.

He told MPs of the Finance Standing Committee that in the FFC view, there was a great need to outline more clearly on how the un-allocated R19.6bn for job creation allocation is to work and who gets it needs to be  a lot more explicit.  On the President’s Covid-19 relief package, the divisions between national and provincial allocations were unclear, he commented.

Summation

Managing the fiscus through and beyond the Covid-19 pandemic had to be fleshed out in a lot more detail, Eddie Rakabe concluded.

From the meeting it became clear that whilst the FFC believes that  an increase in tax revenues  immediately was not a feasible policy option to assist local government through the COVID 19 period, the Minister’s announcement that future tax increases of R5bn in 2021/2022 year, R10bn in 2022/2023, R10bn in 2023/2024 and R15bn in 2024/2025 were considered as an acceptable necessary alternative.

Posted in Agriculture, cabinet, Education, Enviro,Water, Finance, economic, Health, human settlements, Land,Agriculture, Mining, beneficiation, public works, Trade & Industry0 Comments

B-BBEE included with Covid relief regs

Covid relief & BEE don’t mix, say MPs

When the Department of Trade, Industry and Competition (DTIC) were presenting their 2020/21 performance plan to Parliament and after stating that all Covid19 distress funding would be allocated using B-BBEE guidelines, DTIC’s director general, Lionel October, found himself in a spot during questions.

He was asked directly by DA MP, Timothy Brauteseth, what DTIC would say to employees if children went hungry after application by a small time employer failed on such grounds.

Rules are rules

Although the question could be described as a little unfair, DG October replied tactfully that his department was staffed by civil servants “whose job it was to faithfully implement B-BBEE legislation”.

He said all DTIC incentive programmes were conditionally subject to a B-BBEE level and the private sector was usually most co-operative. DTIC was committed to all transformation processes, he said, but he was sure that the scenario in question would not happen.

In other words, the DG had dived for cover.  Later during further questioning on the subject he remarked that DTIC did not “anticipate exclusions of this kind coming up with any programmes associated with the current crisis”.

Well done

The DA complimented DG October during the same meeting on his personal responses over the past months generally to opposition queries and  on his dedication to trade issues during a difficult period.  DA’s Dave McPherson said the DG was one of the few who responded timeously and in detail to their concerns, whereas a good number DG’s failed, he said, to even acknowledge a parliamentary query.

In general, on future plans, DG October told parliamentarians that any framework for the coming years would be subject to a number of downwards adjustments,  especially on the issue of budgeted projects.

This, October said, was in the light of the forthcoming July cuts in budget appropriations as a response to the Covid-19 pandemic in terms of the R 500bn economic recovery package. (Parliament are to debate the DTIC adjustments in the next week or so)

Summation

DG October outlined the department’s total budget of R 11 bn for the 2020/21 financial year, of which 61% or R 6.8 bn is expected to be transferred to public corporations and private enterprises for incentives programmes. Of the total budget, 19% or R 2.1 bn will be transferred to the departmental entities in terms of agreed projects and targets.  DTI operational expenditure, which comprises mainly of compensation of employees, and goods and services, is 18% or R2 bn of the total budget.

DTIC is working on the basis of global economy shrinking by 3% for 2020 as a result of Covid-19.  This is working on IMF figures which figure that South Africa’s economy will probably  shrink by approx. 6%, he said.    To improve growth prospects domestic interventions included the R 500 bn COVID-19 package. There were also “Master Plans” for the automotive sector, poultry industry and retail – clothing, textiles, leather and footwear industries and others were being developed.

October concluded by describing ten key strategic programmes but again stating that all budgets and targets would have to be reviewed in July based on the progression of the pandemic. Accordingly, at this stage, it is quite clear that government planning and associated major capital spending is “on hold” for the moment

The good, bad and ugly

When asked what measures DTIC was taking to reduce the cost of doing business to create an enabling investment environment, DG October answered by quoting instances such as “how much easier it was to register a company and how better to apply for related benefits such as UIF.”   He promised DTIC would make it easier to register properties and process building permits.

DTIC, he said, was also in discussion with Treasury for additional funding for a tax allowance as “an economic responsive package to assist companies in distress as well as to stimulate investment while retaining existing jobs”.

when asked about Section 121 tax allowance schemes where a budget of R 75m had been provided for support of greenfield or brownfield local investment schemes, this had come to an end October concluded.  This was, he said, because almost all the budget had been used up and the fate of what was left would be the subject of “the diversion of funds and projects  which are “gagged by the advent of Covid 19”., he said

Fielding the questions

Dr Corné Mulder re-expressed the hope that B-BBEE would not be applied in the midst of a pandemic with any future schemes (his main theme for the whole meeting).

Dave McPherson asked about DTI pressure upon the National Credit Regulator (NCR) to invoke Section 11 of the in order to allow credit needed under Covid-19 situations.   October ducked this one and said that the NCR’s office and DTIC were currently studying the matter.

On questions on the need to build value-added exports, he quoted a platinum fuel cell production unit which had recently begun operations in Dube Trade Port SEZ.

Looking outwards

Mathew Cuthbert, (DA’s shadow minister of trade), asked Lionel October why South Africa had failed to sign WTO Global Value Chain agreements (GVCs) in the past.   (GVCs assist in reducing trade barriers, lower costs of transportation, can create additional jobs and assist in economic growth in developing countries – for example motor industry assembly plants). 

October looked somewhat perplexed.   In an inconclusive answer, he said he would check with the WTO Ambassador and reply to Cuthbert later in writing.

 

Cuthbert responded to remark that October had said earlier that support was continuing to be given to  the motor assembly industry and it was in “fair condition”.     He said that his feedback told him that this was not the case, particularly in the Eastern Cape where “some motor plants had gone about 98% inactive due to Covid 19 and that the situation was dire.”

He said that DTIC should note this fact and that the department must give the situation its urgent attention. He said Minister Ebrahim Patel must hear that “DTIC had got this completely wrong”.

The meeting ended abruptly due to timeout, but not before EFF’s Yoliswa Yako said that in her opinion Minister Ebrahim Patel was holding back on information and had not participated with any value to the meeting.

 

 

Posted in Agriculture, BEE, Finance, economic, Labour, Trade & Industry0 Comments

Parliament goes virtual for lockdown


….20 May 2020…

SA first with virtual e-debate

….At the same time as the venerable British Parliament was tackling what seemed to them a totally invasive idea of a virtual e-Parliament, South Africa was simultaneously tackling the same subject as COVID 19 arrived at the shores of Africa.  Immediately, the issue of the consideration of lockdown conditions arose in SA and the question of how Parliament could work with everybody boarded.

Whilst British parliamentarians dithered on the subject and due to the fact that the UK kept social distancing going for a much longer time before their lockdown came into force, South Africa’s virtual website portal went up in an incredibly short time and was first in the world by a few days.

Maak ‘n plan

In comparison, the British virtual system. which is also now also working, only allows for debate in the House of Commons whilst South Africa, in terms of its Constitution, follows proceedings in both the National Assembly and the NCOP and also at committee level as well, with the current joint meetings providing provincial coverage.

The design of the entrance website is pretty similar to the UK portal, the principle being the same but with a British budget, the UK presentation is a good deal slicker.  All the same, the Daily Telegraph complained after the UK launch that all that the voice links in the meetings sounded like Darth Vadar and it was confusing to know who was speaking.

Many players

The beginner’s look of the SA virtual meetings is understandable in the situation.   One can see in SA technicians are having a daily struggle with people using Skype and Zoom connections for the first time, some of whom have little knowledge of the difference between an app and a hard drive.

Most are trying, knowing it all has to happen and it would be best to learn quickly but a certain number of senior politicians still demand studio facilities and a camera.   We shall no doubt look back in years to come and laugh at these early attempts to live a virtual reality life.

48 hours allowed

In South Africa, where the decision to suspend the SA Parliament was a “precautionary measure” in the light of a forthcoming Cabinet decision on how to deal with the pandemic, Parliament’s presiding officers in the form of chief whips and political parties all agreed beforehand on the 17 March that the remaining two days of parliamentary business would be devoted to urgent legislation only.

As a result of this decision, Budget Papers in the form of the Division of Revenue Bill were hustled to the National Assembly for adoption in order that money could flow to the provinces and local government.   A Cabinet meeting followed and the Speaker of the House, who acts for the President in Parliament, was summonsed for a meeting soon after.

Hard facts

The role of Parliament is indispensable for the country to run.   The Constitution demands that Parliament scrutinise and oversee all Executive actions, processes Bills in the  form of legislation, to provide a forum for public consideration of issues and to facilitate public involvement in its legislative and other processes. Such is inviolate, whatever the conditions facing the country.

Realizing that the only way was virtual meetings to consider matters,  Speaker Thandi Modise issued a statement that Parliament would have to “intensify its technological capabilities for a transition to an “e-Parliament”.   She concluded that as a result, a decision had been taken that “Parliament will be able to resume taking advantage of virtual media technology”.

 Into action

The leave period, or recess, for MPs was duly cancelled and parliamentary staff were assigned permits to stay at work.  They used this time for urgent meetings -to assess how Parliament could best resume its proper function under lockdown regulations and deal with the lacuna (i.e. a situation where there is no applicable law to deal with the matter).

It was agreed by the Speaker that priority had to be given in Parliament to virtual meetings that required oversight on COVID-19 matters, bearing in mind the limited number of meetings that could be held at any one time.  It was also agreed that any virtual meetings would be primarily joint meetings based on the government cluster system, i.e. meetings comprising the various representatives from a number of differing committees affected by one subject.

 Order, order

Chief whips were then tasked to adapt parliamentary rules to meet the new conditions. All this had to be based on the procedures, precedents, practices and conventions, which have been developed over the years, known as parliamentary rules.  This was in respect of not only how NA and NCOP virtual plenary meetings were to be run but how debate was to be conducted committee.

Speaker Thandi Modise then confirmed to all political parties that in the planned virtual meetings, members of parliament would have the same powers, privileges and immunity as they have ordinarily in parliamentary proceedings.  Quorum requirements were to be exactly the same she said, and MPs would be entitled to cast their votes either electronically or by voice.

Public participation and access to virtual proceedings had to be made possible, said Modise, “in a manner that is consistent with a participatory and representative democracy, virtual meetings to be live-streamed wherever possible”.

Global comparisons

Despite time limitations Parliament was indeed able to try and benchmark against some other legislatures who were operating as legislatures whilst their countries were fighting against COVID-19. To the surprise of all, little was found.

The prime constitutional constraint in South Africa’s case was that any virtual meetings had to involve both the sittings of the National Assembly and the National Council of Provinces and these had to be seen to be happening if the public wished to observe proceedings, a factor necessary according to the Bill of Rights.   This was overcome by making most meetings “joint” committee meetings of parallel committees from both Houses.

One and only

In the UK, which has no constitution, a parliamentary virtual meeting concept had been designed and planning was six months into happening.  From a standing start, SA Parliament achieved their deadline in about a fortnight.  Australia and New Zealand are still only thinking of going about it and the USA is still fighting about lockdown itself.

Without fanfare, the parliamentary process under the extraordinary conditions began internally in the Cape Town precinct after a very short training period on 20th April, with access being made to the existing  public parliamentary website on the link www.parliament.gov.za/parliament-tv.

 Time will tell

The whole thing seems to work quite well but obviously glitches occur regularly whilst MPs struggle from time to time to find the mute button and some appear if they have just got out of bed.  Already, however, after an initial learning curve, things are changing and before long it will be the way things happen.

At each meeting, provision is made for the parliamentary secretary to log in those MPs present at a virtual meeting, name them, see them, accept apologies and at point count voting if required from those logged in through the  electronic response system.   Minutes are established later through the audio track recorded in the same manner as before. This is quite some procedure to witness in some of the hallowed chambers where the Speaker once wore a wig.

An MP’s presence in any virtual meeting is established through a secure link sent to their email address which also enables counting to be established for the purposes of establishing a quorum, taking decisions on issues or voting on a matter. Links are established on Facebook, Linked-in, Twitter and Instagram, the photography on Facebook on parliamentary issues being quite stunning.

 7 out of 10

In general, the new parliamentary virtual world established is considered by most quite for such a rush and the process will no doubt tide the country through this terrible period in its history.  This aside from any opinion on how well MPs handle their own inputs and deal with difficult question of switching between one another to pose and answer questions.  What you see is what you get.  The result is not always pretty but it is legal.

One advantage is that with so much happening with lights flashing and buttons to worry about, there is little time for any MP to have a quiet slumber.

Posted in Agriculture, cabinet, Communications, Defence, Earlier Stories, Energy, Fuel,oil,renewables, Home Page Slider, Justice, constitutional, Police, Public utilities, public works, Security,police,defence, Trade & Industry, Transport0 Comments

Draft climate change strategy in Parliament

…….article June 2019…..

Plan to counter climate change underway…

The inevitability of climate change and the need to plan for its effects on the lives of South Africans is now to be tackled, according to the Department of Environmental Affairs (DEA).  A draft National Climate Change Adaptation Strategy (NCCAS) was published for general comment during parliamentary recess.

This was probably the last public act of past minister of environmental affairs, Nomvula Mokonyane, the baton now having passed to recently appointed Minister Barbara Creecy.  There is probably little room for major directional change as result of public submissions, since the road map to its creation is generally well understood.

Almost final 

Government’s NCCA Strategy, viewed by many as a professional and well written document which includes illustrated graphs and full-colour coded diagrams, is a ten-year plan to be reviewed every five years.  It is to be produced by DEA, the strategy being stated “providing a common vision of climate change adaptation and climate resilience for the country”.

The objective, of course, is the global requirement of achieving the stabilisation of greenhouse gas emissions and limiting temperature increases to 1.5 ° celsius.

The problems

Being a strategy to adapt to a situation and bring about change, the implications for and the effects of climate change upon South Africa are first listed.     Named are such matters as social and societal impact issues, the impact of climate change upon energy planning and economic development generally, and the need for co-ordination arrangements between all spheres of government, SOEs and the private sector.

DEA points out, “The NCCAS not only serves as an adaptation plan but also fulfills South Africa’s commitment to its international obligations as outlined in the Paris Agreement under the United Nations Framework Convention on Climate Change (UNFCCC).”

What it needs

The notice calling for comment says, “The NCCAS focuses on context, strategic focus, the need to reduce vulnerability and build adaptive capacity, early warning systems, adaptation planning, research, governance and legislation and both a finance and an implementation framework.”

The department’s experts have at the same time issued a supporting statement on climate change itself as a subject, which confirms that “worrying” weather patterns are seemingly not about to get any better, increases in annual-average near-surface temperatures are the order of the day and projected to occur over large parts of South Africa, particularly the western interior and northern parts of SA.

Facts evident

The statement adds in the briefing, “Climate zones across South Africa are already shifting and noticeable, ecosystems and landscapes are being degraded, veld fires are becoming more frequent and over-used natural terrestrial and marine systems are under stress.”

It was for these reasons, DEA’s statement concludes that South Africa must take immediate action by planning for climate change and intensifying response to forthcoming impacts, given the extreme weather events that are increasing in the country and which mirror similar changes elsewhere in the world.

No maybe

“Heat wave conditions will be much more likely, the dry spell duration will lengthen slightly, and rainfall intensity is increasing in SA”, says DEA.   The NCCAS warns throughout its presentation that the poor are the most vulnerable to any climate change impact.

Reading between the lines, the NCCAS is no coded message.  It indicates clearly that failure to tackle higher temperatures and unpredictable rainfall could lead to troublesome reactions from poorer sections of the community.  A clear warning is contained in the entire presentation that events being a threat to national security could be the price to pay if no serious counteractions are taken.

DEA says that the NCCAS as proposed will provide “a common reference point for climate change adaptation efforts in South Africa and promote coherence and coordination on climate change adaptation activities between different institutions and levels of government.”

Action will pay off

A positive note is also found in the proposals when it is stated, “The NCCAS is designed to give South Africa an advantage going forward in economic terms”.  It is pointed out that the flip side of adaption to climate change presents many investment opportunities, they claim.  Infrastructural changes are called for, DEA says.

“New funding flows to support adaptation will represent one of the biggest accelerations of development investment since the achievement of democracy in South Africa. The scenarios adopted will provide not only a unique opportunity to both ensure climate resilience but will achieve development aspirations.”

A little “over the top” perhaps, but a carrot that is provided.

The equation

The comment period is until 5 June at which point DEA will consider responses and submit their final strategy plan to Parliament for debate.  Clearly compliance is also seen by DEA as a priority in terms of UNFCCC undertakings made in the Paris Agreement to have such a strategy and plan.

 

Posted in Agriculture, Cabinet,Presidential, Enviro,Water, Land,Agriculture, Public utilities, Trade & Industry0 Comments

Parliamentary Overview 12 June 2019….

 

Changing the guard…  

Plenty of note for business has happened legislatively during the parliamentary recess but perhaps none so important as the re-structuring of Cabinet. As a result  there will be a change in the appropriate portfolio committees to reflect any changes and a consequent shift in portfolio responsibility for various Bills held over from the previous Parliament.    In the areas of energy, trade and industry and communications this will be particularly interesting of who gets to be the chairperson in the light of differences emerging within ANC structures.

Parliament will choose its portfolio committee chairpersons for the National Assembly and select committee chairpersons for the National Council of Provinces on 27th June, two days after the State of Nation Address ANC party chairpersons.  These appointments reflect how a government governs on policy and legislation. Through the chairpersons.

Read more..Parliamentary overview 12 June 2019

Posted in Agriculture, cabinet, Cabinet,Presidential, Energy, Fuel,oil,renewables, Health, Justice, constitutional, Land,Agriculture, Trade & Industry, Transport0 Comments

Sixth Parliament will debate Expropriation Bill…

Expropriation Bill top subject for new parliament….

sent to clients early Jan 2019….

In December 2018, a new draft of the Expropriation Bill was published by government gazette with a 60-day period for comment.   This means the final document will no doubt become the kingpin of debate in the first session of the new Parliament. It will also form the basis of much comment by President Cyril Ramaphosa in his second State of the Nation Address.

Not many were expecting a final legislation proposal for comment so soon after the ConCourt constitutional decision on the subject.  Land restitution, as distinct from land reform, is the kind of hot-potato subject that many say should never be debated just before an election.  With the whole issued being overlaid with a tinge of fear, it is also an ideal subject for fake news, they say. 

Read more….Expropriation Jan 2019

Posted in Agriculture, cabinet, Finance, economic, human settlements, Justice, constitutional, Trade & Industry0 Comments

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