Ms ND Ntwanambi: Acting Chairperson

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403 3661

Friday 18 June 2004 (11:20)

WESTERN CAPE

Ms ND Ntwanambi [ANC]

Eastern Cape

None

Free State

Mr CJ Van Rooyen [ANC]

KwaZulu Natal

None

Limpopo

Ms N Ndalane [ANC]

Mpumalanga

Ms MP Themba [ANC]

North West

Ms JF Terblanche [DA]

Mr ZS Kolweni [ANC]

Northern Cape

None

Officials present

1. Dr C Mokeyane, Director General: Department of Public Enterprises (DPE_
2. Mr James Theledi, acting Deputy director General: Analysis and risk management, DPR
3. Ms Thembi Msibi, Director: International relations, DPE

Staff present;

1. Ms Phumza Mpoyiya, Control Committee Secretary: Committee Section
2. Ms Chantal Paulse, Committee distant: Committee Section

Apologies: Ms S Chen (Gauteng)

Mr D Gamede (KwaZulu Natal)

Mr D G Mkono (Eastern Cape)

1. Follow -up) presentation by DPE on strategic plan and budget vote
2. Role of DPE in relation to Committee

Opening:

The acting chairperson welcomed officials from the DPE

The Director General made a presentation on the DPE’s strategic plan and on the DPE’s budget for 2004-05 (a copy of the presentation available from the Committee Secretary).

The following items amongst others were covered:

1. Mission statement
2. Key strategic objectives
3. Achievements of the Department: first phase
4. Key deliveries, 10 others are still being explored
5. Key challenges
6. Relationship of the Committee with the Department

The Acting Deputy Director General briefed the Committee, as follows:

1. Medium-term expenditure framework (MTEF) allocations for 2004-2005

2. Budget per branch R’000 million

a) Personnel and staff costs 42,825

b) Administrative costs 14,937

c) Equipment 1,284

d) Professional and consulting fees 9,892

e) Transfer payments 6,922

f) Miscellaneous 128

3. The DPE identified the following areas as important:

• Policy restructuring, with a strategic focus on greater oversight over SOEs;
• Improve infrastructure investments and the impact on skill development, research and development, and Black Economic Empowerment;
• Co-ordinate effort to improve logistics, lower the cost of business, facilitate access to finance through the NEF, promote Public Private Partnerships (PPPS) joint ventures and concessions;
• Bring private sector in building new capacity of electricity;
• Available for strategic interaction.

Questions on the presentations.

3. The DPE identified the following areas as important:

This is as an international issue between management and the Board. The DPE will provide more information at a later stage (Committee Secretary to follow up this matter).

What plans does DPE have concerning the houses situated along the route in Lainsburg?

There is a process for dealing with houses that need repairs, but it still needs to be consolidated. A BEE company or organisation will be identified to handle security of tenure of these houses. The purpose is to ensure that Transnet does not have ownership of areas that it is not supposed to own.

In addition, the Department of Housing noticed that there are some properties that are financed through SOEs even though these properties do not support the core business of those SOEs. This exists because of the history of the Railway system. Transnet's Treasury had to seek loans for funding those houses. The DPE has noted the need to empower companies to play a role in the property market. Most of the railway houses are not the responsibility of government. The DPE needs to give away some of those houses but the Department of Provincial and Local Government has to commit to these areas. All attempts will be employed to ensure that houses of persons who were previously employed by the Railway are considered.

What is to the new tendering process of Safcol? What processes are in place and background has this any benefit to the rural communities?

The DPE and the Departments of Agriculture and Land Affairs Land Affairs and of

Public Works are closely involved in the contracting process.

Ms Themba asked what measures were used by the DPE in order to attract communities to opportunities that exist within Safcol?

These opportunities were made through the tendering process and most of them were linked to communities. Through the process of consultation, communities have 10% rental, which is paid to them per annum. This is done in consultation with the Traditional Leaders in the respective areas.

One of the Safcol tenders is in Komatiland but it is cancelled later last year due to some problems. The tender is then reopened again in March 2004. The DPE is currently communicating with the Competition Commission on the matter.

Mr Van Rooyen congratulated DPE on obtaining unqualified Audit Reports in Annual Report and successful transaction with Eskom.

More information on this matter will be made available later (Committee Secretary to contact the Parliamentary Liaison Officer on this matter).

Ms Ndalane inquired about arts and culture programmes in rural areas?

How did DPE relate with its NGO, specifically in relation to the funding of this process?

MsNdalane had to leave early to catch a flight. The DPE's response on these questions would be directed to Ms Ndalane].

Mr Kolweni requested more information about the DPE strategy on investment plans?

The DPE plans include integration, co-ordination and allowed for maximum impact. In the Koega port, there is a co-ordinated activity between the department of Trade and Industry. Portnet Authority, SA Port Operations, and Eskom to generate capacity for the smelter.

The DPE is also looking at bi-sector relations for the development relating to airports, electricity, and water (national bulk water infrastructure). For economic development specific projects (with budgets and timeframes) will be identified hopefully by end of September 2004. Those who are interested and who do not have funding will have to produce their business plans.

Mr Kolweni asked how DPE linked up with Independent development Trust, (IOT) in relation to the Lesotho Highland Water Scheme?

The DPE works with other departments. It offers technical support with regard to the above project. Different parts of the country have different water needs. The Project is aimed at ensuring that water is accessible and available for human consumption AND agriculture. The DPE coordinated these through inter- ministerial departments.

How much progress has been made in relation to NCOP Bills?

There is new legislation on its way to the NCOP, but minor adjustments still need to be made before it is introduced.

What has been done to ensure that the Aventura in North- West benefits the Black people in the province?

There are 15 holiday resorts most of them are owned by black people. These have created job opportunities for people within the communities. There are certain challenges concerning claims made on some of these lands. DPE in consultation with the Department of Land affairs are addressing them.

The DPE will place an advertisement in the newspaper from Eskom for the position of project manager. It is one step of addressing the problem of capacity building.

Adverts will be placed in the newspaper and normal processes will be followed. In the event that the candidate cannot be located, the employment agency will be requested to locate the candidate. But this will be considered as the last resort. Once all measures have been exhausted without success, the DPE will have to headhunt. In terms of the budget allocation, R27 million has been set aside to ensure that growth and development occurs and more people are fully employed.

(This question was not answered)

Clarification was requested between Sun Air and Kulula.com. The department has to pay R15 million for Sun Air. The airlines Kulula.com and One time are privately owned.

Mr Van Rooyen asked whether there have been public hearings held on the National Ports Authority Bill last year? The relevant Committee of the National Assembly held hearings, but not in the NCOP.

Ms Themba requested the organogram of the DPE. Such information should reflect the gender focal points as well as budget allocations for respective personnel.

Information on the structure of the Department will be made available to the Committee. (Committee Secretary to make follow up on this matter)

The Acting Chairperson thanked the DPE for the briefing and said that the following information was required for the benefit of the Committee:

• Annual report, which reflects the current structure of the DPE;
• More information on Eskom
• Relevant information on the Koega Project and information on the involvement of BEE and how does the project is of benefit to the Mandela Metro in terms of employment opportunities;
• Information about rural projects within forestry (Safcol), these could be useful for members to consider during the constituency period;
• Role of the DPE within the East London Zone as there was very little information reflected in the presentation;
• Rail communication relating to Durban and Johannesburg-this info is considered important for oversight function.

The meeting adjourned at 12:30.

Ms N. Ntwanambi

Acting chairperson