OF THE REPUBLIC OF SOUTH AFRICA · 2019-03-06 · Wednesday, 6 March 2019] 3 ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS NO 25─2019 The Bill has been referred to the Portfolio

Wednesday, 6 March 2019] 1

ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS NO 25─2019

No 25—2019] SIXTH SESSION, FIFTH PARLIAMENT

PARLIAMENT

OF THE

REPUBLIC OF SOUTH AFRICA

ANNOUNCEMENTS,

TABLINGS AND COMMITTEE REPORTS

WEDNESDAY, 6 MARCH 2019

TABLE OF CONTENTS ANNOUNCEMENTS National Assembly and National Council of Provinces 1. Bills passed – to be submitted to President for assent .......................... 2 National Assembly 1. Referral to Committee of Bill introduced ............................................. 2 2. Return of Bills for concurrence ............................................................ 2 National Council of Provinces 1. Membership of Committees ................................................................. 3 TABLINGS National Council of Provinces 1. Chairperson ........................................................................................... 3 COMMITTEE REPORTS National Assembly 1. Trade and Industry .............................................................................. 55

2 [Wednesday, 6 March 2019


National Council of Provinces 1. Education and Recreation ................................................................... 72 2. Security and Justice ............................................................................ 73 3. Security and Justice ............................................................................ 78

ANNOUNCEMENTS National Assembly and National Council of Provinces The Speaker and the Chairperson

1. Bills passed by Houses – to be submitted to President for assent

(1) Bills passed by National Council of Provinces on 6 March 2019:

(a) Powers, Privileges and Immunities of Parliament and

Provincial Legislatures Amendment Bill [B 18 – 2018] (National Assembly – sec 75).

(b) National Credit Amendment Bill [B 30 – 2018]

(National Assembly – sec 76). National Assembly The Speaker 1. Referral to Committee of Bill introduced

(1) The following Bill is referred to the Standing Committee on

Appropriations for consideration and report in terms of the Money Bills Amendment Procedure and Related Matters Act, 2009 (Act No 9 of 2009):

(a) Division of Revenue Bill [B 5 - 2019] (National

Assembly – proposed sec 76). 2. Message from National Council of Provinces to National

Assembly in respect of Bills amended by Council and returned to Assembly for concurrence (1) Bill amended and passed by Council and returned for

concurrence on 6 March 2019:

(a) National Public Health Institute of South Africa Bill [B 16D – 2017] (National Assembly – sec 76).



The Bill has been referred to the Portfolio Committee on Health of the National Assembly.

National Council of Provinces The Chairperson

1. Membership of Committees

(1) The following changes to Select Committees membership have

been made:

Select Committee on Finance Appointed: Hon. Ms L C Dlamini (ANC – Mpumalanga) – Alternate Appointed: Hon. Mr B G Nthebe (ANC – North West) – Alternate Appointed: Hon. Mr D M Stock (ANC – Northern Cape) – Alternate Appointed: Hon. Mr D L Ximbi (ANC – Western Cape) – Alternate Select Committee on Appropriations Appointed: Hon. Ms L C Dlamini (ANC – Mpumalanga) – Alternate Appointed: Hon. Mr B G Nthebe (ANC – North West) – Alternate Appointed: Hon. Mr D M Stock (ANC – Northern Cape) – Alternate Appointed: Hon. Mr D L Ximbi (ANC – Western Cape) – Alternate Select Committee on Land and Mineral Resources (Agriculture, Forestry and Fisheries, Rural Development and Land Reform, Environmental Affairs and Mineral Resources) Appointed: Hon Mr MI Rayi (ANC- Eastern Cape)- Alternate Select Committee on Communications and Public Enterprises (Communications, Telecommunications and Postal Services, Science and Technology and Public Enterprises) Appointed: Hon. Mr M I Rayi (ANC – Eastern Cape) – Alternate

TABLINGS

National Council of Provinces 1. The Chairperson

(a) National Women’s Parliament Report 2016









































































































COMMITTEE REPORTS National Assembly 1. Report of the Portfolio Committee on Trade and Industry

on the Department of Trade and Industry’s Third Quarter

Financial and Non-financial Performance for the 2018/19

Financial Year, dated 6 March 2019

The Portfolio Committee on Trade and Industry, having assessed the service

delivery performance of the Department of Trade and Industry, against its

mandate and allocated resources, in particular the financial resources for the

period 1 October to 31 December 2018, on 13 February 2019, reports as

follows:

1. INTRODUCTION

The DTI is critical in creating an enabling, inclusive and competitive

environment that attracts investment and promotes trade thereby

contributing positively to economic growth and employment creation. For

the 2018/19 financial year, the DTI has allocated over 56.4 percent of its

budget to incentives aimed at broadening participation, promoting

manufacturing, creating competitiveness, and promoting investment in

critical infrastructure.

The quarterly reports are a significant indicator in alerting the Committee to

issues that may arise in the Annual Report and enable it to call on the

Minister to take appropriate action earlier to remedy any shortcomings. In

addition, the pattern of allocative efficiency becomes clearly visible as the

year progresses which enables the Minister and his team to monitor and so

avoid, among other issues, the temptation to resort to fiscal dumping.

However, from this report it would appear that this has not been the case.



With respect to the third quarter report, the DTI achieved 21 of its 25

quarterly performance targets. While three of the four quarterly performance

targets were not achieved during the third quarter, the year-to-date targets

set for these performance indicators were met and in certain instances, even

the annual targets were already over-achieved by the end of December

2018. The fourth performance indicator that had not been met focuses on

new jobs created. This could be contributed to the recent technical recession

whose lagged effect is still being experienced.

1.1. Mandate of the Committee

Section 5 of the Money Bills Amendment Procedure and Related Matters

Act (No. 9 of 2009) requires the National Assembly, through its

committees, to annually assess the performance of each national department

over an 18 month period. This culminates in a committee submitting a

report of this assessment known as a Budgetary Review and

Recommendation (BRR) Report. The overarching purpose of the BRR

Report is for the committee to make recommendations on the forward use of

resources to address the implementation of policy priorities and services, as

the relevant department may require additional, reduced or re-configured

resources to achieve these priorities and services. This Act gives effect to

Parliament’s constitutional powers to amend the budget in line with the

fiscal framework.

The current process forms part of ongoing oversight of the DTI’s financial

and non-financial performance. This will inform the next BRR process.

Furthermore, Parliament’s Annual Performance Plan requires committees to

submit quarterly reports on each department’s performance.

1.2 Purpose of the Report

The purpose of this report is to monitor the financial and non-financial

performance of the DTI against its predetermined objectives and quarterly

milestones as part of the Committee’s ongoing oversight. This report

assesses the non-financial performance for the third quarter of the 2018/19

financial year, namely from 1 October to 31 December 2018; and financial



performance up to the third quarter of the 2018/19 financial year, namely

from 1 April to 31 December 2018.

1.3 Method

The Committee was briefed by the DTI on its third quarter performance

report for the 2018/19 financial year on 13 February 2019. The third quarter

data was still preliminary at the date of adoption.

1.4 Outline of the contents of the Report

Section 1 of the report provides an introduction to the report including its

purpose, and method. Section 2 outlines the DTI’s strategic objectives.

Section 3 assesses the DTI’s financial and non-financial performance

against its Amended Annual Performance Plan for the 2018/19 financial

year up to 31 December 2018. It also outlines the key issues raised by the

Committee during deliberations with the DTI. Section 4 provides the

Committee’s concluding remarks followed by a note of appreciation in

Section 5. The report then closes with the Committee’s recommendations

for the National Assembly’s approval in Section 6.

2. STRATEGIC OBJECTIVES OF THE DEPARTMENT

The DTI’s performance is in line with its strategic objectives, which guide

its work and is aligned to its programmes. The strategic objectives are as

follows:

• Promoting a professional, ethical, dynamic, competitive and customer-

focused working environment that ensures effective and efficient service

delivery.

• Building mutually beneficial regional and global relations to advance

South Africa’s trade, industrial policy and economic development

objectives.

• Facilitating broad-based economic participation through targeted

interventions to achieve more inclusive growth.



• Facilitating transformation of the economy to promote industrial

development, investment, competitiveness and employment creation.

• Creating a fair regulatory environment that enables investment, trade

and enterprise development in an equitable and socially responsible

manner.

3. OVERVIEW AND ASSESSMENT OF THE DEPARTMENT’S

FINANCIAL AND NON-FINANCIAL PERFORMANCE FOR

THE PERIOD 1 APRIL TO 31 DECEMBER 2018

This section provides a comparison between the DTI’s second quarter

milestones outlined in its amended Annual Performance Plan (APP) against

its third quarter report for the 2018/19 financial year. Furthermore, it

outlines its financial performance. Lastly, it highlights the key issues related

to the DTI’s performance raised during the Committee’s deliberations.

3.1 Non-Financial Performance

For the 2018/19 financial year, the DTI had 25 performance targets

according to its amended APP. Of the 25 targets the DTI reported that 21

targets were achieved while four were not achieved. This translates to 84%

achievement of its targets. The table below provides a breakdown of

achievement of targets by programme and an overview of the targets that

were not met.

Table 1: Non-financial Performance by Programme as at 31 December

2018

Performance Indicator/Meas

ure

Annual targets

Planned Q1 & Q2

Actual Q1 & Q2

Planned Q3

Actual Q3

Reasons for deviation

YTD performa

nce Programme 1: Administration

Strategic objective: Strengthened capacity to deliver on the dti mandate Percentage of staff turnover (unexpected)

6.8% 3.4% year to date

2.1% 1.7% (5.1% year to date)

1.2% Turnover projected was less than actual terminations

3.3%

Percentage of people with disability employed

3.6% 3.42% 3.86% 3.55% 3.75% No change since previous quarter where more employees disclosed

3.75%




ure

Annual targets

Planned Q1 & Q2

Actual Q1 & Q2

Planned Q3

Actual Q3


YTD performa

nce Percentage of Women employed in senior management (SMS) positions

50% 50% 51% 49% 52% % of women in SMS exceeded due to an increase of 2 female SMS members and reduction of one male SMS member

52%

Percentage of eligible creditors payments processed within legal timeframes

100% eligible creditors’ payments made within 30 days


100% of 10 715 eligible creditors’ payments made within 30 days



Target exceeded due to more stringent reviews on the turnaround times through daily statistics


Programme 2: International Trade and Economic Development Sttrategic objective: Grow the manufacturing sector to promote industrial development, job creation,

investment and exports Number of status reports on regional economic integration

2 status reports produced on progress for Tripartite Free Trade Agreement (T-FTA)

1 status report produced on progress on TFTA negotiations

1 status report produced on the progress of the TFTA negotiations

Nil Nil No deviation 1 status report

4 status reports produced on progress on Continental Free Trade Agreement (CFTA) negotiations

2 status report produced on progress on CFTA negotiations

1 status report produced on the progress of the CFTA negotiations



No deviation 2 status report




ure

Annual targets

Planned Q1 & Q2

Actual Q1 & Q2

Planned Q3

Actual Q3


YTD performa

nce Number of reports on Implementation of SADC-EU1 Economic Partnership Agreement (EPA)

2 reports on implementation of SADC-EU EPA

1 Status report on the implementation of the EPA

1 status report on the implementation of the EPA

Nil Nil No deviation 1 status report

Number of status reports on engagements in Global fora (BRICS2, G20, AGOA3, United Kingdom (UK) Brexit)

16 status reports produced on engagements in Global Fora


8 status reports prepared on BRICS, UK Brexit, G20 and AGOA engagements


4 status reports prepared on engagements in Global Fora

No deviation 12 status reports

Programme 3: Special Economic Zones and Economic Transformation Strategic objective: Grow the manufacturing sector to promote industrial development, job creation,

investment and exports Number of SEZs4 submitted to Minister for designation

1 Nil Nil Nil Nil No deviation Nil

Number of implementation reports on the Industrial Parks submitted to Minister

2 1 1 Nil Nil No deviation 1

Number of reports on implementation of the B-BBEE5 Amendment Act and Regulations submitted to the Minister

2 1 1 Nil Nil No deviation 1

1 Southern African Development Community-European Union 2 Brazil, Russia, India, China and South Africa 3 African Growth Opportunity Act 4 Special Economic Zones 5 Broad-based Black Economic Empowerment




ure

Annual targets

Planned Q1 & Q2

Actual Q1 & Q2

Planned Q3

Actual Q3


YTD performa

nce Number of interventions to support Black Industrialists (BIs) in the Industrial Policy Action Plan (IPAP) Sectors (non-financial)

70 interventions to support BIs in the IPAP sectors (Non-financial).

37 interventions to support BIs in the IPAP sectors

40 interventions to support BIs in the IPAP sectors (non-financial support)



Due to strategic partnerships and collaborations with the private sector

64 interventions

Programme 4: Industrial Development Strategic objective: Grow the manufacturing sector to promote industrial development, job creation,

investment and exports New iteration of IPAP submitted to Minister for tabling in Cabinet annually

Annual Rolling IPAP 2019/20 submitted to Minister for tabling in Cabinet by March 2019

Q1: Launch the Annual Rolling IPAP 2018/19

Q1: Launched the Annual Rolling IPAP 2018/19

Nil Nil No deviation IPAP 2018/19 was launched

Number of implementation reports on IPAP prepared for the Minister’s Review Meetings per year

4 Implementation reports on IPAP prepared for the Minister’s Review Meetings per year

2 Implementation report on IPAP prepared for the Minister’s Review Meetings per quarter

1 Implementation report on IPAP prepared for the Minister’s Review Meetings

1 Implementation report on IPAP prepared for the Minister’s Review Meetings per quarter

1 Implementation report on IPAP prepared for the Minister’s Review Meetings held on 3 October 2018

No deviation 2

Number of designation requests prepared for Minister per year

2 designation requests prepared for Minister per year

1 designation request prepared for Minister per quarter

Nil Nil 1 designation request prepared for Minister i.e. Medium Voltage (MV) switchgear products

Designation request was prepared in Q2 and received Minister’s approval in Q3

1



Programme 5: Consumer and Corporate Regulation Strategic objective: Improved conditions for consumers, artists and opening up of markets for new patents

players Number of Socio-Economic Impact Assessment System (SEIAS) reports developed for Minister’s approval

1 SEIAS report on the Companies Amendment Bill developed for Ministers approval

Second draft SEIAS report on the Companies Amendment Act developed for Minister’s approval

First draft SEIAS report on the Companies Amendment Act developed for Minister’s approval

Nil Nil No deviation First draft of SEIAS report

Number of progress reports developed for Minister's approval

4 progress reports on the development of the Gambling, Liquor, Credit, Performers and Copyright Amendment Bills developed for Ministers approval

2 progress reports on the development of the Gambling, Liquor, Credit, Performers and Copyright Amendment Bills developed for Minister’s approval

2 progress reports on the development of the Gambling, Liquor, Credit, Performers and Copyright Amendment Bills developed for Minister’s approval

1 progress report on the development of the Gambling, Liquor, Credit, Performers and Copyright Amendment Bills developed for Minister’s approval

1 progress report on the development of the Gambling, Liquor, Credit, Performers and Copyright Amendment Bills developed for Minister’s approval

No deviation 3 progress reports

Number of education and awareness workshops on policies and legislation conducted and report produced for Ministers approval

24 education and awareness workshops on policies and legislation conducted and report produced for Ministers approval

12 education and awareness workshops on policies and legislation conducted and report produced for Minister’s approval




Due to official requests from municipalities

26 workshops



Programme 6: Incentive Development and Administration Strategic objective: Grow the manufacturing sector to promote industrial development, job creation,

investment and exports Value (Rand) of projected investments to be leveraged from projects/enterprises approved

R15bn R6bn R13.9bn R6bn R6.6bn Approved Automotive Incentive Scheme (AIS), Critical Infrastructure Projects (CIP) and Film & TV projects resulted in high value of projected investments

R20.5bn

Projected number of new jobs supported from projects/enterprises approved

10000 6 000 6 109 3 000 1 490 Not achieved: The number of applications/projects received during this quarter projected fewer number of new jobs to be created

7 599

Number of jobs retained from approved enterprises

20000 10 000 15 811 8 000 7 434 Not achieved: The number of applications/projects received during this quarter projected fewer number of new jobs to be created

23 245

Number of enterprises/projects approved for financial support across all incentives

850 350 493 300 179 Not achieved: The number of applications/projects received during this quarter were less than anticipated hence fewer applications were approved for financial support

672



Programme 7: Trade Investment South Africa Strategic objective: Grow the manufacturing sector to promote industrial development, job creation,

investment and exports Value of export sales generated

R4 billion R1.95bn R3.598bn R950 million

R426 million

Not achieved: As at 15 January 2019, companies were still providing feedback on their six months’ report, as most companies only reopened on 14 January 2019, and the figure may increase.

R4.024bn

Number of companies assisted under Export, Marketing and Investment Assistance (EMIA) in supporting value added exports

823 410 588 206 234 Positive variance was due to the quality recruitment of companies.

822

Programme 8: Investment South Africa Strategic objective: Grow the manufacturing sector to promote industrial development, job creation,

investment and exports Value (Rand) of investment projects facilitated in pipeline

R50bn R26.5bn R44.889bn

R10bn R193.504bn

Investment commitments flowing from the Presidential Investment Summit in October 2018

R238.393bn

Source: DTI (2019a)

3.2 Financial Performance

The DTI’s adjusted budget for the 2018/19 financial year is R9.5 billion. In

the third quarter of the 2018/19 financial year, the DTI had projected

spending of R6.25 billion and spent R6.19 billion or 99.1% of the year to

date budget. By the end of the third quarter, 35.1% of the total annual

budget was available. The largest proportion of the budget (80.2%) was

spent on incentive payments and other transfers; while 11.7% was spent on



compensation of employees, 7.9% on goods and services and 0.2% on

payments for capital assets. The over-expenditure on payments for capital

assets was as a result of planned procurement of computer equipment during

the 2017/18 financial year, which was finalised and paid for in the 2018/19

financial year.

Table 2: Financial Performance by Economic Classification as at 31

December 2018

Description

Adjusted

Budget

2018/19

Year to date (YTD) % budget

available

Cash flow

projections Expenditure %

Variance R’000 R’000 R’000

Compensation of

employees 987 518 739 635 725 359 1.93% 26.55%

Goods and services 694 519 480 355 488 790 (1.76%) 29.62%

Transfers: 7 821 646 5 020 319 4 965 961 1.08% 36.51%

Incentive schemes 5 380 538 2 744 721 2 744 708 0.00% 48.99%

Other transfers 2 441 108 2 275 598 2 221 253 2.39% 9.01%

Payments for capital

assets 28 075 6 800 10 108 (48.65%) 64.00%

Total 9 531 758 6 247 109 6 190 218 0.91% 35.06%

Source: DTI (2019b)

In terms of programmes, the Incentive Development Administration

Programme spent the largest amount (R2.9 billion or 46.3% of the third

quarter expenditure), followed by the Industrial Development Programme

(R1.9 billion or 30.3% of the third quarter expenditure). All its programmes’

expenditure was within a reasonable deviation of the planned expenditure

with the exception of the Special Economic Zones and Economic

Transformation Programme, which had a significant underspending of

29.43% of the projected spending due to delays in the listing of the B-BBEE

Commission. The planned spending for the Commission is for current and

capital projects, which is dependent on the provision of office

accommodation, amongst others.



The table below shows the DTI’s expenditure for the third quarter by

programme.

Table 3: Financial Performance by Programme as at 31 December 2018

Programme

Adjusted

Budget

2018/19

Year-to-date % Budget

available Cash flow

projections Expenditure

%

Variance

R’000 R’000 R’000 % %

Administration 838 605 584 937 590 906 (1.02%) 29.54%

International Trade and

Economic Development 124 773 76 201 78 862 (3.49%) 36.80%

Special Economic Zones and

Economic Transformation 146 276 114 521 80 823 29.43% 44.75%

Industrial Development 2 029 777 1 897 748 1 874 030 1.25% 7.67%

Consumer and Corporate

Regulation 330 347 290 045 286 551 1.20% 13.26%

Incentive Development

Administration 5 567 857 2 879 601 2 867 872 0.41% 48.49%

Trade and Investment South

Africa 411 602 359 294 362 948 (1.02%) 11.82%

Investment South Africa 82 521 44 762 48 227 (7.74%) 41.56%

Total 9 531 758 6 247 109 6 190 218 0.91% 35.06%

Source: DTI (2019b)

3.3 Issues raised during the deliberations

The following concerns were raised related to the performance of the DTI

during the Committee’s deliberations:

• Status of the Manufacturing Competitive Enhancement Programme

(MCEP): The Committee acknowledged the contribution of the MCEP

in providing manufacturing companies incentives to raise their

competitiveness and retain jobs after the 2008 global financial crisis.

However, the Committee was of the view that a long-term vision would

be preferable and requested that the DTI should provide an update on

the status of this incentive programme. The DTI informed the

Committee that the MCEP was developed to specifically deal with the



global financial crisis. It was an incentive programme which supported

manufacturing enterprises with competitiveness improvement

interventions. The DTI is not looking at further funding for the incentive

programme as the prevailing circumstances have changed, but it is

exploring a generic programme for the manufacturing sector. This

would be aimed at assisting companies to promote innovation and

preparing them for the Fourth Industrial Revolution.

• The impediments in the uptake of the Youth Employment Service

Initiative: In 2018, the Minister of Trade and Industry announced the

Youth Employment Service (Y.E.S) Initiative which is to provide for,

and institute, Broad-Based Black Economic Empowerment (B-BBEE)

Recognition for Y.E.S Measured Entities and qualification criteria

applicable to, the B-BBEE Recognition for Job Creation. The

Committee welcomed this initiative but was concerned about the slow

uptake by companies in this regard. The DTI informed the Committee

that this initiative had a private sector component with set targets.

Government delivered on its commitment by providing B-BBEE

Recognition for the Y.E.S Measured Entities and qualification criteria

applicable to the B-BBEE Recognition for Job Creation. The DTI was of

the view that a major awareness campaign should be launched to ensure

that the private sector meets its commitments.

• The status of the 12I tax incentive: The Committee welcomed the

impact of the 12I tax incentive, which was designed to support

Greenfield investments (i.e. new industrial projects that utilise only new

and unused manufacturing assets), as well as Brownfield investments

(i.e. expansions or upgrades of existing industrial projects), on the

manufacturing sector. The incentive offers support for both capital

investment (manufacturing assets to improve productivity), and training

(improving the labour productivity and skills profile of the labour force).

The Committee enquired about the status of the 12I tax incentive. The

DTI informed the Committee that it had started negotiations for the

extension of the 12I tax incentive with the National Treasury. Initially,



the 12I incentive was only focusing on supporting investments in the

SEZs but the DTI is of the view that investment in Industrial Parks

should also benefit from this incentive. The DTI reviewed the current

12I applications and would present its findings to National Treasury for

consideration.

• Measures to address high unemployment: South Africa’s

unemployment rate is ranked among the highest globally. The

Committee enquired whether the DTI is considering measures that

would contribute to the reduction of unemployment. The DTI informed

the Committee that one of the contributing factors to the high

unemployment rate is the failure to develop a competitive

manufacturing sector due to high input costs. In addition, South Africa

is caught in a low wage-low skills trap, as the country underinvested in

developing a population with advanced skills. To address this

shortcoming, South Africa should introduce unconventional industrial

policies.

• Achievement of investment targets in the third quarter: For the period

under review, the DTI had emphasised, among others, the importance of

the promotion of international and domestic investment to bring about

economic transformation. The Committee welcomed the fact that the

DTI had reached its targets with respect to investment. The DTI

informed the Committee that the annual target for investment was set at

R4 billion but as a result of a targeted investment drive, the target had

been surpassed within the first three quarters of the financial year. As at

15 January 2019, companies were still providing feedback as most

companies only reopened on 14 January 2019 on their six months’

report and the figure of R426 million may increase subsequently.

• The impact of projected low economic growth in China with respect to

South Africa: The Committee enquired whether the project low

economic growth in Gross Domestic Product (GDP) in China would

have an adverse effect on the South African economy. The DTI



informed the Committee that the Chinese economy had been

experiencing lower economic growth over a long period of time.

Currently, China is focusing on developing their service sectors and

growing their domestic consumer market rather than export-led

industrialisation. South Africa is exporting raw materials to China and in

the DTI’s view the impact of their slower economic growth would be

limited. The DTI would be more concerned if some of South Africa’s

key export markets, e.g. Africa, were projecting low economic growth.

• The impact of administered prices on industrialisation: High

administered prices, continues to have a negative impact on the

manufacturing sector. A major concern for the Committee remains the

high cost of electricity which renders the manufacturing sector

uncompetitive. The Committee enquired about the measures the DTI

would be considering to address this anomaly. The DTI informed the

Committee that the stimulus package announced by the President

included securing cheap electricity prices for strategic industries. A

measure that should be considered would be allowing these strategic

industries to generate their own electricity and secure the rights to do so.

Port and rail prices remains excessively high which is a major concern

for the DTI. The DTI informed the Committee that the supply side

challenges, such as high electricity, port and rail charges, would be

addressed in the next iteration of the IPAP. This is to ensure that

government supports strategic industries by providing appropriately

priced electricity, port and rail charges to assist in improving

competitiveness.

4. CONCLUSIONS

Based on its deliberations, the Committee drew the following conclusions:

4.1 The Committee commends the department for having achieved most

of its third quarter targets as outlined in its Annual Performance

Plan. The Committee welcomed the fact that the DTI has over-

achieved its annual targets with respect to its non-financial



performance in a number of areas, such as value of projected

investments to be leveraged from projects/enterprises approved, jobs

retained, export sales generated and investment projects facilitated

within the pipeline notwithstanding fiscal constraints. While it has

not met four of its quarterly targets, three of these exceeded their

year-to-date targets over the nine month period. Only “projected

number of new jobs supported from projects/enterprises approved”

has not met the target in the third quarter. This performance

indicator had been exceeded in the first two quarters. However, the

Committee concerned that this shortfall may result in the annual

target not being met.

4.2 The Committee noted that while the technical recession had ended,

there would be a delay in the impact thereof, which could affect new

jobs being created and the number of compliant claims being

submitted for incentive support.

4.3 The Committee welcomed the significant improvement in spending

from the second to third quarter.

4.4 The Committee remains concerned with the impact of high

administered prices on the manufacturing sector as it negatively

impacts on industrial competitiveness and thus economic growth, job

creation and economic transformation. The Committee supports the

DTI efforts to find a resolution that would enable strategic industries

to become for competitive.

5. APPRECIATION

The Committee would like to thank the the Director-General, Mr L October,

the acting Group Chief Operating Officer, Ms N Matomela, the

Parliamentary Liason Officer, Ms Saroj Naidoo, and all other senior

managers of the DTI for their cooperation and transparency during this

process. The Committee also wishes to thank its support staff, in particular

the committee secretaries, Mr A Hermans and Mr T Madima, the content



advisor, Ms M Sheldon, the researcher, Ms Z Madalane, the committee

assistant, Ms Y Manakaza, and the executive secretary, Ms T Macanda, for

their professional support and conscientious commitment and dedication to

their work. The Chairperson wishes to thank all Members of the Committee

for their active participation during the process of engagement and

deliberations and their constructive recommendations reflected in this

report.

6. RECOMMENDATION

Informed by its deliberations, the Committee recommends that the House

requests the Minister of Trade and Industry to:

6.1 Engage with the relevant Ministers to reach a resolution on how to

support strategic industries through appropriate pricing of administered

prices, such as electricity, port and rail charges.

Report to be considered.

REFERENCES

Department of Trade and Industry (2018a) Amended Annual Performance

Plan 2018/19.

Department of Trade and Industry (2019a) Third Quarter Performance

Report 2018/19.

Department of Trade and Industry (2019b) Third Quarter Performance

Report 2018/19. Presentation to the Portfolio Committee on Trade and

Industry. Cape Town: Parliament, 13 February.



National Council of Provinces 1. Report of the Select Committee on Education and

Recreation on the National Qualifications Framework

Amendment Bill [B20B – 2018] (National Assembly – sec 75),

dated 06 March 2019:

The Select Committee on Education and Recreation, having considered the

subject of the National Framework Amendment Bill [B20B – 2018],

referred to it and classified by the Joint Tagging Mechanism as a section 75

Bill, reports that it has agreed to the Bill with the Members of the

Democratic Alliance opposing.

Report to be considered



2. Report of the Select Committee on Security and Justice on the Defence Amendment Bill [B18-2017] (National Assembly – sec 75), dated 6 March 2019. The Select Committee on Security and Justice, having deliberated on and considered the subject of the Defence Amendment Bill [B18-2017] (National Assembly– sec 75), referred to it and classified by the JTM as a section 75 Bill, reports that it has agreed to the Bill with the following proposed amendment:

1. Amendment agreed to: The Select Committee considered and agreed to the following proposed amendment. 1.1 New Amendment amending Section 103 in the principle Act:

Board of inquiry in relation to absence without leave 103. (1) When any member of the Defence Force has been absent without leave [more than 30 days] for a continuous period exceeding 10 calendar days and is still absent, a board of inquiry must be convened by the officer commanding of the absent member to inquire into such absence.

2. Amendments considered but rejected: The Select Committee considered two proposed amendments emanating from the Right2Know submission but rejected the proposed amendments. 2.1 Section 15 in the Defence Amendment Bill amending section 83A. (1) in

the principle Act: 83A. (1) The Minister may prescribe measures, in consultation with the relevant parliamentary committee, to regulate access to any…

2.2 Section 15 in the Defence Amendment Bill amending section 83A. (2) in

the principle Act: 83A. (2) Any regulation made under subsection (1) may provide that a contravention of or failure to comply with that regulation is an offence and that any person found guilty of the offence is liable to a fine or to imprisonment for a specified period that may not exceed 15 years for any specific offence.”

3. Public participation process on the Defence Amendment Bill [B18-2017]

The Select Committee on Security and Justice advertised the Bill on electronic platforms of Parliament on 26 October 2018 and extended the deadline to 16 November 2018. The Committee received one written submission from the Right2Know and a proposed amendment from the Department of Defence:



SUMMARY OF SUBMISSIONS

DEFENCE AMENDMENT BILL [B18-2017]

DEPARTMENT OR ORGANIZATION

RECOMMENDATIONS

PROPOSED AMENDMENT

DEPARTMENT OF DEFENCE

Proposed change to wording of Section 103

PROPOSED WORDING OF AMENDED SECTION 103(1) OF THE DEFENCE ACT, 2002 (ACT NO. 42 OF 2002) Board of inquiry in relation to absence without leave 103. (1) When any member of the Defence Force has been absent without leave [more than 30 days] for a continuous period exceeding 10 calendar days and is still absent, a board of inquiry must be convened by the officer commanding of the absent member to inquire into such absence.

RIGHT TO KNOW Clause 15 (1) provides for extremely broad prohibition on access to military property and or large areas around such property, with excessive, indiscriminate penalties. The wide reaching provisions do not distinguish between intentional and unlawful access, and accidental, harmless or even access made with the purpose of exposing criminality, corruption or imminent danger. The Minister is granted a high degree of discretion in drafting the regulations, with no legal guidance or parliamentary oversight. The Bill’s criminal sanctions may, for example, see community members being prosecuted for unintentional and harmless access to military property or areas.

Proposal Clause 15(1): Right to Know recommends that this entire section should be scrapped. However, in the event that the Committee chooses to retain these provisions, Right to Know urges members to make amendments to ameliorate the worst aspects of this clause, including: a) The regulations drafted by the Minister should be subject to a full and transparent public participation process through Parliament. This may also have the added benefit of avoiding legal challenges to the regulations, as has been the case for the department in the 2007 SANDU v Minister of Defence and Another. b) As a further safeguard to protect legitimate public interest media reporting and whistleblowing, we recommend that access to military property or areas with the purpose of exposing



criminality, corruption or imminent public danger should not be subject to criminal sanction. c) The criminal sanctions in the clause should be subject to an adequate harm test, and the sanction should be differentiated according to the type of offence committed. d) The penalty clause at 15(2) would be strengthened by the inclusion of intentional and unlawful proviso, thereby excluding harmless or unintentional access. e) Clause 15(3) should be removed in its entirety as adequate protections for such sites are provided for through the Critical Infrastructure Protection Bill (to replace the old National Key Point Act, 1980)

DOD Response to recommendations of Right to know Clause 15

Recommends the replacement of Section 83A(2) with a similar provisions as contained in Section 82(3) of the Defence Act, 2002. The effect of the change will be that the Minister may prescribe various penalties that fit specific offences. Proposed change: “(2) Any regulation made under subsection (1) may provide that a contra-vention of or failure to comply with that regulation is an offence and that any person found guilty of the offence is liable to a fine or to imprisonment for a specified period that may not exceed 15 years for any specific offence.”



RIGHT TO KNOW Section 104 of the Defence Act of 2002 contains the main penalty and offences provisions. Clause 16 of the Defence Amendment Bill makes limited proposals only in respect of criminal enforcement for the unlawful possession or wearing of military uniforms and other distinctive marks. Right2Know believes these demand the urgent attention of Parliament, and therefore brings it to the attention of the Committee: a) There are sweeping criminal penalties of up to 5 years for the disclosure and publication in the media of all classified information in terms of the Act. b) Section 19(a) ramps up the penalty for accessing, possession, reproduction and disclosure of classified information from “classified facilities, installations or instruments” including “digital data” up to 25 years in prison. c) The constitutional right to protest and strike are unduly criminalised, despite our apex court ruling that the defence department is not exempt from adhering to constitutional Defence Union v Minister of Defence and Another. d) The Act provides no explicit protection for whistleblowers -- either under the Protected Disclosures Act, the Prevention and Combating of Corrupt Activities Act

Proposals: It would be prudent and in the public interest for this Committee use this opportune moment to introduce minor additional amendments to remedy some of the more serious defects of s104, which may infringe on the constitutionality of the Act.



or even a general public interest defence for whistleblowing which is vital for our democracy. The Defence Act falls short of even the contentious Protection of State Information Bill in this regard.

DOD Response The DOD expressed the view that the Right to Know comments on Section 104 should be dealt with in a detailed submission containing Right to Know’s views, arguments and proposals regarding Section 104 of the Defence Act to the Minister of Defence and Military Veterans for consideration with a view to possible inclusion of amendments in a future Defence Amendment Bill.

4. Certification of the Bill

The Select Committee certifies that – a. all amendments are constitutionally and procedurally in order within

the meaning of Joint Rule 161; and b. no amendments affect the classification of the Bill.

5. Consensus on the Bill

a. Support for the adoption of the Bill with proposed amendments was

unanimous. No objections were raised. Report to be considered.



3. Report of the Select Committee on Security and Justice on an

oversight visit to the Gauteng Province to conduct oversight of the

Vanderbijlpark Police Station, and to oversee the working relationship

between the SAPS, the National Prosecuting Authority and the

Department of Correctional Services in Emfuleni to reduce crime in the

area, held on 17 October 2018, report dated 6 March 2019.

Vanderbijlpark Police Station, Emfuleni, Gauteng Province

1. Background:

The Select Committee on Security and Justice (the Committee), as part

of its mandate to provide a national forum for the public consideration of

issues affecting the provinces, conducted an oversight visit to the

Vanderbijlpark police station to conduct a discussion with the South

African Police Service (SAPS), the National Prosecuting Authority

(NPA) and the Department of Correctional Services (DCS) on the

strategy in place to reduce crime in the area but also broadly for the

region and South Africa in general. The discussion included the working

relationship between the role players and any areas to improve the

situation related to, staffing matters, success rate of convictions, prison

control, rehabilitation of offenders and statistics on recidivism.

2. Delegation:

2.1. The oversight delegation was composed of the following members:

Province Political Party Present

Free State Democratic Alliance Hon Mr G Michalakis

Gauteng Democratic Alliance Hon Mrs B Engelbrecht

Limpopo African National Congress Hon Dr HE Mateme

Mpumalanga African National Congress Hon Mr SG Mthimunye

(Committee Chairperson)

Northern Cape African National Congress Hon Mrs GG Oliphant

Western Cape African National Congress Hon Mr DL Ximbi



The following parliamentary staff supported the Committee: Mr G Dixon – Committee Secretary, Ms A Van Der Burg – Content Advisor, Ms P Whittle – Researcher and Mr P Bongco – Intern Committee Assistant.

3. SAPS delegation

Major General Masha: Deputy Provincial Commissioner Colonel Mr C Van Schalkwyk: Head of Detectives Commander Mr K Mboyi: Visible Policing Captain Van Der Ryst

4. National Prosecuting Authority Mr S Mzinyathi: Provincial Director of Public Prosecutions Mr M Luphondo: Chief Prosecutor Mr A Coetsee: Senior Prosecutor

5. Department of Correctional Service Mr KJ Katenga: Chief Deputy Commissioner Mr M Magwa: Head of Operations Mr M Thabethe: Security Officer DCS

6. Emfuleni1 Emfuleni has two main city or town centres, namely Vanderbijlpark with a population of 95 840, and Vereeniging and is situated in a major iron and steel industrial producing area. Emfuleni Local Municipality (ELM) is one of three local municipalities that constitute the Sedibeng District Municipality. ELM contains six large former peri-urban townships of Evaton, Sebokeng, Sharpeville, Boipatong, Bophelong and Tshepiso. The latter six areas lack facilities associated with towns of their size. The other ten small settlements tend to be suburban in nature and are within six kilometres radius of the above towns: they are Bonanne, Steel Park, Duncanville, Unitas Park, Arcon Park, Sonlandpark, Waldrift, Rust-ter-Vaal, Roshnee and Debonairpark. The area also comprises of a number of large residential areas, all of which require considerable investment in infrastructure and environmental upgrading. Emfuleni has a very high unemployment rate, in 2011 it was at 34,7%, while the youth unemployment rate was even higher at 45%. The high unemployment rate, especially among the youth, likely affected the increase in drug-related and the high number of reported property crimes (burglary and theft).

1 Whittle, P (2018). 3-Year Crime Information for Vanderbijlpark (Emfuleni Local Municipality) ─ Background Information for SC Justice and Security Oversight Visit. Research Unit. Parliament of South Africa



According to Emfuleni Local Municipality’s Final IDP 2017/18 – 2020/21, in their engagement with the Municipality, communities again raised the following service delivery issues which could affect crime and policing in certain areas, namely a need for police stations, high rate of crime, maintenance of roads, patching of potholes, tarring of roads, need for street lights, high rate of unemployment, drug abuse, need for multipurpose centres, maintenance of parks, need for sports facilities, need for speed humps and dysfunctional high mast lights.

7. Briefing by the SAPS Vanderbijlpark The SAPS indicated that in its efforts to reduce crime in the area the SAPS strategy focussed on improving its internal execution and action plan in the form of the Stabilisation Plan for 1 October 2018 to 31 December 2018. The plan focusses on crime docket analysis to determine the area, method and times the crimes are committed for operational purposes. This ties in with the suspects profiling task where all profiles taken on all suspects are enhanced with regards to previous convictions. A main repeat offenders’ database is maintained. Detectives then employ a suspect tracing team and an ex-offenders list. The list is used to make follow ups with ex-offenders to discourage repetitive behaviour and disrupt planned activities. Community engagement As part of its stakeholder engagement process the SAPS focus on mass patrols and community patrols that is hosted at least once per week. The corner task and bus stop talks task in the Stabilisation Plan focusses on engaging the community such as street kids, hawkers, domestic workers and other groupings to gather information. The SAPS forms working relationships with the security companies’ forum to establish a relationship and coordination of operations. Communities are educated through crime hints to share preventative information in the protection of lives and property. The SAPS also targets the youth through monthly awareness campaigns to create awareness amongst students regarding the levels of crime and preventative measures. Visible policing has had an impact in reducing the levels of crime and improving community cooperation. The Community Police Fora, students and neighbourhood watch are active participants in bi-monthly operations in hot spots in the area.



Challenges

1. The SAPS indicated there is a lack of human resources to serve communities of Vanderbijlpark and Bophelong.

2. The Non-availability of other Law Enforcement Agencies after hours has a negative impact on Joint Operations with regard to bylaws, traffic, health, etc.

3. Lack of or no consultation with SAPS with relation to Liquor Board Licence’s granted to shebeens at university.

4. Station renovations through the Department of Public Works, Vanderbijlpark cells are not operational and detainees are housed at neighbouring stations. Limited office space due to closed sections to renovate access control.

5. Challenges between SAPS and NPA: Non synchronization of targets between SAPS and NPA, however Vanderbijlpark SAPS and Vanderbijlpark Court have an open door policy with each other in order to address challenges if and when they arise which improves communication.

6. Trio crimes: Bophelong is a large area and SAPS can only deploy one vehicle in the area. The tavern approval next to churches and schools without SAPS comment on the impact of crime in the area is problematic. Shebeens contribute to assaults. If there are policy or legislative gaps the SAPS are encouraged to make a submission. Zoning of liquor and times of operation were brought into question.

In Vanderbijlpark, property crimes decreased in 2018 after increasing in 2017, compared to 2016. Nationally, this category decreased by 32 678 or 6 per cent in 2018, compared to the previous two years.

Other categories that increased include drug-related crime and carjacking, which increased to 54 in 2018 compared to 33 in 2017; robbery at residential premises (up to 105 in 2018 from 72 in 2017); and robbery with aggravating circumstances (increased to 460 compared to 454 in 2017). Murder and attempted murder decreased in 2018 compared to 2017. Members interaction Members applauded the SAPS for the low cash-in-transit heist crime rate and queried the strategy SAPS employed in the successful decrease in the crime rate. The SAPS noted that the plan included community involvement with the Afriforum Neighbourhood Watch providing tremendous support to the police. The SAPS Cross border operations and closer working relationship with the community, businesses, forum engagement and security company assistance, all contributed to successfully reducing crime. The SAPS indicated that the Field Task Team works to prevent and follow up on issues. Parolees previously involved in specific crimes were visited by police to ensure they don't commit similar crimes and this helps to disrupt their criminal intentions.



8. Presentation by the NPA The NPA presented their crime statistics for the Vanderbijlpark area although it services the Vaal Rand cluster as a whole. The Vanderbiljpark area has two District courts and one Regional court. The NPA has one senior prosecutor, one control prosecutor, one prosecutor in the Regional court and five prosecutors in the District courts. The NPA acknowledged that there is a shortage of prosecutors and although they have a number of vacant posts in Vanderbijlpark, the structure of the NPA allows other prosecutors to carry the workload. The NPA noted that with regard to the five monthly statistics, in the entire NPA there is over 120 Regional courts, Vanderbijlpark ranked second nationally, in terms of efficiency. There are over 400 District courts nationally with Vanderbiljpark ranking 78th. In terms of Magistrates courts, Vanderbijlpark ranked 68th nationally. The courts finalised five cases per day above the national average of three per day. The Regional court target for finalising cases is 0.7% nationally but Vanderbiljpark operates at 0.8%. The conviction rate average is set at 74% for the Regional court and the District court is set at 85% but Vanderbijlpark is operating at 96% for both courts. The NPA admitted that it has a good screening process that allows it to put forward cases that have strong evidence and good dockets. The SAPS noted that many of the cases that the SAPS considers a priority is not put forward by the NPA. This places the SAPS at a disadvantage with the community who views the police as incompetent. The NPA noted that the SAPS and the NPA have a good working relationship and although there are some difference in priorities between the two organisations, the matter could be discussed and resolved. The detection rate of SAPS and the cases finalised with NPA was not in alignment at the time of reporting. The matter has been harmonized. The NPA noted that arrests are a monitored activity but prima facie evidence must be present for enrolment at court. The NPA noted further that it received about 600 decision dockets monthly and although they have a turnaround target of 7 days the Vanderbijlpark NPA is able to turnaround within 3 days. The NPA and police meet on a regular basis to discuss the dockets. The NPA noted that it had dealt with five cases related to the Vanderbijlpark ‘Fees Must Fall’ protest action and while the NPA had considered alternative sentencing for the students involved in the unrest, the matter was a moot point as all five students were found not guilty. 9. Presentation by the DCS The DCS indicated that that out of the 200 posts there are 8 vacancies. The approved accommodation of 254 currently houses 415 inmates. Remand detainees are approved for 445 but the DCS currently houses 462 incarcerated offenders.



The DCS Challenges:

1. The facility houses mentally disturbed individuals and the facility does not have the trained personnel to care for these individuals.

2. The DCS indicated they would appreciate the diversion for petty crimes to relieve the pressure on the DCS facility.

3. The NPA noted that the admission of foreign nationals in the system places a strain on the system due to the logistics of traveling to the Department of Home Affairs and as a result of the deportation procedures.

Members queried the following:

• How many foreign nationals in prison? The DCS responded that there were less than 50 foreign nationals.

• Members suggested that because there is a DCS office in each

province, the Department of Home affairs should visit the prison once a month to check on foreign nationals.

10. Committee Recommendations 1. Proposal for Department of Labour to continue to provide skills for

incarcerated offenders. The Services Seta should be involved as well in offering offender rehabilitation programmes.

2. The Committee proposed the DCS should meet with the Department of Home Affairs to process foreign prisoners at the correctional facility.

Report to be considered.

Documents

OF THE REPUBLIC OF SOUTH AFRICA · 2019-03-06 · Wednesday, 6 March 2019] 3 ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS NO 25─2019 The Bill has been referred to the Portfolio