(The following report replaces the Report of the
Portfolio Committee on Trade and Industry which was published on page 1698 in
ATC No 33 dated 20 March 2014)
Report of the Portfolio Committee on Trade
and Industry on its activities undertaken during the 4th Parliament (May 2009 –
March 2014), adopted on 12 March 2014
Executive summary
1.
Committee’s focus areas during the 4th
Parliament
1.1 Industrial
Policy
The revised Industrial Policy Action Plan (IPAP2) was an
organised effort to stem deindustrialisation and the decline of the
manufacturing sector. It was a shift towards the growth of a developmental
economy designed to accelerate employment creation.
The Portfolio Committee on Trade and Industry became
aware of the developments within the steel and iron ore industry and the
potential impact it may have on various related value chains including those
sectors mentioned above. As the IPAP2 is in its implementation phase, the
committee – as part of its oversight responsibility – provided a forum for the
major industry players to discuss the issues at stake. A major concern for the
committee was the potential impact it would have on downstream industries and the
key objectives of IPAP2 – the expansion of the manufacturing base and job
creation, as well as job security. Monopolistic pricing of key inputs remains
an obstacle in the manufacturing sector and therefore a potential obstacle to
Government in achieving its developmental agenda.
A developmental steel price that would underpin the IPAP2
objectives becomes critical. An Inter-Departmental Task Team on Iron Ore and
Steel was established to design set of inter-related policy instruments policy
instruments to give effect to government efforts to secure a developmental iron
ore and steel price in support of downstream, value-adding industries of the
manufacturing sector. Cabinet has agreed to a range of instruments designed to
secure developmental iron ore and steel prices.
During its continued oversight over the implementation of
IPAP, it came to the committee’s attention that high administered prices could
potentially derail the implementation of IPAP. In response, the committee held
a colloquium with relevant stakeholders related to electricity charges and port
tariffs to find a solution. As a result of this engagement, Transnet announced
that it would review its port tariff structure to support industrialisation and
the export of value-added goods.
1.2 International and Regional Trade
Relations
South
Africa developed its first formal draft trade policy and strategy document, “A
South African Trade Policy and Strategy Framework”, in 2010. Its trade policy
was contextualised within the government’s broader economic development vision
and to achieve the imperatives of the National Industrial Policy Framework.
As part of
a broader consultative approach of the Department of Trade and Industry (DTI),
a request was received by the committee to express an opinion on the Trade Policy
and Strategy Framework to ensure that Parliament’s views could be incorporated
into the final document. The committee welcomed this opportunity and process as
it allowed it to study the “Discussion Document” and engage stakeholders openly
on the future path of South Africa’s trade policy to ensure more equitable
results.
Other
activities included the committee’s participation at international trade fora,
such as the 8th and 9th World Trade Organisation’s (WTO)
Ministerial Meetings, the 5th BRICS (Brazil, Russia, India, China
and South Africa) Summit, and the International Astronautical Federation’s
(IAF) Meeting for Parliamentarians. The committee’s participation at these fora
has contributed to its understanding of trade and other related matters and
allowed it to offer support to the Minister at these fora. It also provided
committee members with a platform to engage with their international
counterparts and to actively participate in the domestic and international
debate. However, participation should be expanded to include oversight over
other trade and investment-related matters, such as trade fairs or pavilions, through oversight visits abroad. This would
ensure that the committee is able to oversee the effective use of the financial
resources allocated to these activities and to understand the investment
mechanisms being leveraged.
1.3 Legislation
processed
The Speaker made 12 referrals to the
committee in relation to 11 bills, nine executive bills and 2 private member’s
bills. The 12th referral was due to the fact that the Intellectual
Property Laws Amendment Bill was referred back to the National Assembly by the
President of the Republic of South Africa in terms of section 79(1) of the
Constitution, as he had reservations about the constitutionality of the Bill.
These reservations related to the non-referral of the Bill to the National
House of Traditional Leaders and that the Bill should have been dealt with in
terms of section 76 of the Constitution. The committee considered and processed
these 11 pieces of legislation during the 4th Parliament. Eight
bills were adopted by the committee with significant amendments. Two of these pieces
of legislation were redrafted by the committee, namely the Intellectual
Property Laws Amendment Bill and the two Co-operatives Amendment Bills which
were combined into one bill.
The Broad-Based Black Economic
Empowerment and the National Credit Amendment Bills attempt to accelerate the
transformation of the South African economy. The committee effectively
scrutinised these pieces of legislation to ensure that this is achieved.
The Special Economic Zones Bill aimed
to improve on the industrial development zones (IDZ) programme introduced in
2000. The Bill was motivated by the need to urgently address challenges within
the broader framework of accelerating industrial development, economic growth
and job creation. The Bill allows for the designation of different types of
special economic zones.
1.4 Gambling Review Commission (GRC) Report
During the
committee’s consideration of the Interactive Gambling Regulations, it became
aware of the potential challenges within the gambling industry due to
technological advances. This led to it embarking on public hearings on the
following:
·
the socio-economic impact of legalised
gambling,
·
the impact of misleading advertising,
·
the regulation of cross-border gambling,
·
the current regulatory environment, and
·
interactive gambling.
The
committee expressed a view that the socio-economic impacts of legalised
gambling were inadequately represented and appeared to be biased in favour of
the gambling industry. Therefore, it was critical for the committee to have
more detailed socio-economic information in this regard to make appropriate
recommendations in regard of the future development of gambling legislation.
The
Department of Trade and Industry (DTI) announced that it was establishing a
Gambling Review Commission to investigate the socio-economic impacts of
legalised gambling as well as the status of the gambling industry and new forms
of gambling.
The
committee received the GRC’s Report and established a subcommittee to consider
the report and make recommendations to it. The subcommittee tabled its report
for the committee’s consideration on 7 March 2012. The DTI in response to the
committee report tabled the Lotteries Amendment Bill which addresses some
issues raised. Further legislative initiatives with respect to the gambling
industry are expected to be tabled in the 5th Parliament.
1.5 Budgetary oversight
The
committee has been tabling Budget Review and Recommendation Reports (BRRR) in
terms of the Money Bill Procedures and Related Matters Amendment Act since
2010. The process of developing a BRRR involves overseeing the DTI’s financial
and non-financial performance over an 18 month period. The committee engaged in
regular quarterly financial and non financial performance meetings with the
DTI, as well as a selection of its entities, over and above the required
oversight of the budget and strategic plans and annual plans.
2.
Key areas for future work
·
Effectiveness of
IPAP/industrialisation efforts and incentives.
·
Oversight over
ongoing trade relations, implementation of existing agreements and the
promotion and protection of investment.
·
Oversight over the
establishment of new entities and the role-out of expanded mandates.
·
Consumer protection
and the implementation of the consumer protection and National Credit Act.
·
Update on the
committee’s GRC recommendations.
·
Strengthening of
the BRRR process.
3.
Key challenges emerging
·
There is an
over-reliance on the reporting by the DTI and entities’ to determine their
performance and level of service delivery. Public participation, especially in
terms of areas of regulation and broadening participation, should be leveraged
to strengthen the oversight process.
·
Historically, the
DTI’s entities
have had a record of good governance and financial management. However;
recently, a number of entities, especially newly-established entities, have
started to show challenges with respect to maintaining good governance and
financial management systems. This may be due to insufficient monitoring by the
DTI.
·
Inaccessibility of
information, such as international agreements, policies and strategies, in the
public domain is a serious concern.
·
A challenge that
remains is that the committee is not always sufficiently informed about (1)
existing international obligations and developments at international
institutions, e.g. the World Intellectual Property Organisation, (2) policy
developments and (3) task teams within South Africa that affect the work of the
DTI. This has resulted in situations where seemingly incoherent or conflicting
policies have been adopted.
·
The committee tends
to receive late correspondence with regard to important conferences being
hosted by the DTI or its entities. These conferences provide a wealth of
insight into areas that the committee oversees and are invaluable to attend.
·
Implementation of
the Industrial Policy Action Plan has been hampered by constraints arising from
uncoordinated approaches among departments that have led to a rise in the cost
of doing business.
·
The National
Consumer Commission had received a qualified audit report for the 2012/13
financial year due to lack of documentation of certain procurement activities,
which were allegedly stolen from its office. This is expected to remain a
challenge during future audits for a number of years.
·
There has been a
lack of cohesion in the implementation of national gambling policy among
national and provincial gambling authorities, which has not been resolved
within these five years. Furthermore, transformation within the horse-racing industry
has been slow with grooms being one of the few stakeholders in the industry not
being officially recognised.
·
There have been
incidents where critical concepts have been insufficiently defined by the DTI
or it was unclear what the intended structure and roles of implementing
agencies were within new legislation. This has led to unnecessary confusion
among Members and the DTI when deliberating on legislation and time delays.
·
There is usually
insufficient time available to interrogate the impact of international
agreements and engage with other affected stakeholders before the committee
recommends the agreement for ratification.
·
Implementation of
the Agreement between the Government of the Republic of South Africa and the
Government of the Republic of Cuba on Economic Assistance has been hindered
mainly due to the economic embargo on Cuba.
4.
Recommendations
The
committee in the 5th Parliament should consider:
·
Intensifying public participation especially
in terms of the thematic areas of regulation and broadening participation to
assess the accessibility of the DTI and its entities and the quality of
services delivered, as well as the effectiveness of protection offered to
consumers and distressed businesses.
·
Allocating a portion of its budget to enable members
and/or staff to attend important conferences that would enhance the committee’s
oversight role.
·
Requesting the DTI and its entities to submit
written quarterly performance reports.
·
Commissioning independent research on the
effectiveness of IPAP and the DTI’s incentive programmes.
·
Requesting the Minister to provide a status
report on the implementation of the recommendations of the Inter-departmental
Task Team on Iron Ore and Steel.
·
Encouraging the
consolidation of the boards of technical infrastructure institutions into a
single board to ensure coordination between these institutions.
·
Developing a process for active participation
during the negotiating phase of key trade agreements.
·
Requesting that the
committee be allowed to exercise it oversight more effectively in relation to
trade-related matters, such as trade fairs or pavilions, through oversight
visits abroad,
·
Requesting the Minister to table a report on
the facilitation process between the grooms and other horse-racing stakeholders
to address issues of transformation.
1.
Introduction
1.1
Functions of committee
Parliamentary
committees are mandated to:
·
Oversee the financial and non-financial
performance of government departments and their entities to ensure that
national objectives are met.
·
Process and pass legislation.
·
Facilitate public participation in Parliament
relating to issues of oversight and legislation.
1.2
Committee Strategic Plan
At the beginning of its tenure, the committee
developed a Strategic Plan for 2009/10 – 2013/14. It agreed on a vision and
mission for the period under review. The committee’s vision was to be an effective and efficient committee that
initiates and processes legislation and exercises monitoring and oversight with
an emphasis on the effective implementation of industrial policy to drive trade
policy imperatives, thereby creating an enabling environment for economic
development, equity and the consolidation of a non-racial, non-sexist,
prosperous, democratic developmental state for job creation.
The committee’s
mission was to:
§ Ensure
that the real economy grows through oversight over the development and
implementation of trade policy within the context of the industrial policy
arena.
§ Ensure
equity through economic empowerment and transformation.
§ Contribute
to good governance.
§ Advance
domestic, continental and international trade links.
§ Promote
regional integration.
§ Ensure
broader public participation.
§ Co-ordinate
and co-operate with other related parliamentary committees.
This culminated into six strategic objectives
covering the functions of the committee, which are as follows:
·
The refinement
of the legislation process;
·
Improving oversight
over the institutions falling under its portfolio area as well as on the
implementation of its legislation;
·
Dealing with International and Regional Trade
Relations;
·
Improving the
knowledge and skills of its members to deal with the complex, technically
demanding matters placed before the committee;
·
Dealing with
matters of public interest; and
·
Facilitating
co-operative governance.
The details of the mechanisms to achieve each
of these strategic objectives are outlined in the committee’s Strategic Plan.
1.3
Method of work of the committee
In order to achieve its objectives, the
committee developed annual plans. The annual plans outlined the specific
oversight programmes determined by the committee for that year. Due to its
heavy workload, the committee agreed that it would select a number of entities
to consider during the strategic plan and annual report processes.
Furthermore, the committee opted to establish
temporary multi-party “sub-committees” to work through controversial and/or
technical bills or topics more intensively and to propose recommendations to
the broader committee. This assisted by ensuring that these issues were
processed in the most efficient and effective manner. Where necessary, the
committee also procured the services of experts and/or advisors to assist with
the processing of technical legislation.
The fourth Parliament of the Republic of
South Africa took a decision that at least two portfolio committee meetings
should be held at venues outside of the parliamentary precinct annually. This
is to enhance public participation and to fulfil one of its strategic
objectives of taking “Parliament to the People”. In line with this decision,
the committee held public meetings in Atlantis (Western Cape), Umtata (Eastern
Cape), Sedibeng (Gauteng), Kathu (Northern Cape), Nelspruit (Mpumalanga), and
Durban (KwaZulu-Natal) over its tenure.
In terms of budgetary oversight, the new
Money Bills Amendment Procedure and Related Matters Act (No. 9 of 2009) sets
out the process for Parliament to make recommendations to the Minister of
Finance to amend the budget of a national department. In October of each year,
portfolio committees must compile Budgetary Review and Recommendation Reports
(BRRR) that assess a department’s service delivery performance given available
resources, evaluate the effective and efficient use and forward allocation of
resources, and may make recommendations on the forward use of resources.
1.4
Department/s and Entities falling within the
committee’s portfolio
The Portfolio Committee on Trade and Industry
oversees the work of the Department of Trade and Industry and its entities.
This section provides an overview of the core mandates of the Department and
its entities, as well as entities that will be established due to recent
legislative amendments and/or new legislation that has been passed during this
Parliament.
It should be noted that at the beginning of
the term, an additional seven entities reported to the Department. Six of these
were transferred to the Economic Development Department during the 2009/10
financial year. These were the: (i) Competition Commission, (ii) Competition
Tribunal, (iii) Industrial Development Corporation (IDC), (iv) International Trade Administration Commission
(ITAC), (v) Khula Enterprise Finance Ltd and (vi) South African Micro-Finance
Apex Fund (SAMAF). However, due to the crucial role that these played in
enabling certain departmental functions, the Minister and the Department has
maintained close working relations with these entities. The Estate Agency Affairs Board was the
seventh entity to be transferred from the DTI. It was transferred to the
Department of Human Settlements during the 2012/13 financial year.
1.4.1
Department of Trade and Industry
The Department’s core mandate is to:
·
Provide leadership to the South African
economy through its understanding of the economy, and its knowledge of economic
opportunities and potential.
·
Act as a catalyst for the transformation and
development of the economy and to respond to the challenges and opportunities
of economic citizens, in order to support the government’s economic goals of
growth, employment and equity.
·
Respond to the challenges and opportunities
in the economy and society.
·
Provide a predictable, competitive, equitable
and socially responsible environment for investment, enterprise and trade.
It has pursued this mandate through five
themes aligned to its five strategic objectives, namely:
·
Industrial
Development: Facilitate
transformation of the economy to promote industrial development, investment,
competitiveness and employment creation.
·
Trade,
investment and exports: Build
mutually beneficial regional and global relations to advance South Africa’s
trade, industrial policy and economic development objectives.
·
Broadening
participation: Facilitate
broad-based economic participation through targeted interventions to achieve
more inclusive growth.
·
Regulation: Create a fair regulatory environment that
enables investment, trade and enterprise development in an equitable and
socially responsible manner.
·
Administration
and co-ordination: Promote
a professional, ethical, dynamic, competitive and customer-focused working
environment that ensures effective and efficient service delivery.
1.4.2
Entities
Name of Entity |
Role of Entity |
Companies and Intellectual Property Commission (CIPC), a merger
between the former Company and Intellectual Property Registration Office and
the Office of Company and Intellectual Property Enforcement |
Registers businesses,
intellectual property rights and other juristic persons such as cooperatives,
maintains related registries and develops information for disclosure to
stakeholders, promotes compliance and enforces the Companies Act,
particularly in areas such as receiving and initiating complaints regarding
alleged contraventions and investigating relevant complaints and financial
reporting standards. In addition, it promotes education and awareness
regarding company and intellectual property laws and related matters. |
Companies and Intellectual Property Tribunal (CIPT) |
Adjudicates in relation to any application
that may be made to it, and makes any order as provided for in the Companies
Act in respect of such an application. In addition, the Tribunal may serve as
a forum for voluntary alternative dispute resolution. |
Export Credit Insurance Corporation of South Africa (ECIC) |
Facilitates and encourages
South African export trade by underwriting bank loans and investments outside
the country in order to enable foreign buyers to purchase capital goods and
services from the Republic. |
National Consumer Commission (NCC) |
Investigates
complaints and refers them to courts or the National Consumer Tribunal for
prosecution; issues compliance notices and conducts awareness and education
compliance campaigns in relation to consumer matters. |
National Consumer Tribunal (NCT) |
Adjudicates on applications
under the National Credit Act by consumers, credit providers, debt
counsellors and the National Credit Regulator, as well as on matters relating
to allegations of prohibited conduct referred by the National Credit
Regulator. In addition, the Tribunal adjudicates on cases referred to it by
the NCC under the Consumer Protection Act (No. 68 of 2008). |
National Credit Regulator (NCR) |
Regulates the South African credit
industry. Its functions include education,
research, policy development, registration of industry participants,
investigation of complaints, and ensuring enforcement of the National Credit
Act. |
National Empowerment Fund (NEF) |
Enables, develops, promotes and implements
innovative investment and transformation solutions to advance sustainable
black economic participation. It is therefore a catalyst of Broad-based Black
Economic Empowerment in South Africa. |
National Gambling Board (NGB) |
Is responsible for upholding the integrity,
viability and sustainability of the gambling industry by promoting uniform
national norms and standards for provincial authorities. |
National Lotteries Board (NLB) |
Regulates the National Lottery and all
other lotteries in South Africa and administers the National Lotteries
Distribution Trust Fund. |
National Metrology Institute of South Africa (NMISA) |
Maintains primary scientific
standards of physical quantities, certifies reference materials and performs
referee analysis in cases of measurement disputes to ensure accurate
measurement in South Africa. It also provides internationally recognised
measurement standards and measurement services, which provide for the local
use of measurement and derived units of the International System of Units
(SI). |
National Regulator for Compulsory Specifications (NRCS) |
Administers (i) the National Regulator for
Compulsory Specifications (No. 5 of 2008), (ii) the Trade Metrology (No. 77
of 1973) and (iii) the National Building Regulations and Building Standards
(No. 103 of 1977) Acts, as well as other regulations that fall under other
departments as far as they relate to compulsory standards to protect human
health, safety and the environment and ensure fair trade, in accordance with
government policies and guidelines. |
Small Enterprise Development Agency (SEDA) |
Supports small business development in
South Africa, particularly in rural areas. Its mandate
is designing and implementing a standard national delivery network that must
uniformly apply throughout the country. |
South African Bureau of Standards (SABS) |
Promotes and maintains
standards and quality assurance in connection with commodities and the
rendering of services. |
South African National Accreditation System (SANAS) |
Formally recognises
the competency of laboratories, certification bodies, inspection bodies,
proficiency testing scheme providers and good laboratory practice (GLP) test
facilities to carry out specific tasks. |
The following new entities will be
established based on recent legislative amendments:
Name
of entity |
Role(s)
of entity |
Date
for establishment |
Broad-based Black Economic Empowerment
(BBBEE) Commission |
The
BBBEE Commission will be responsible for: ·
Overseeing, supervising and promoting
adherence with this Act. ·
Strengthening and fostering collaboration
between the public and private sector in order to promote and safeguard the
objectives of BBBEE. ·
Receiving complaints relating to BBBEE. ·
Investigating, either of its own initiative
or in response to complaints received, any matter concerning BBBEE. ·
Promoting advocacy, access to opportunities
and educational programmes and initiatives of BBBEE. ·
Maintaining a registry of major BBBEE
transactions, above a threshold determined by the Minister. ·
Receiving and analysing such reports as may
be prescribed concerning BBBEE compliance from organs of state, public
entities and private sector enterprises. ·
Promoting good governance and
accountability by creating an effective and efficient environment for the
promotion and implementation of BBBEE. ·
Increasing knowledge of the nature and
dynamics and promote public awareness of matters relating to BBBEE. |
September 2014 |
Co-operatives Development Agency |
The Co-operatives Development Agency’s
objectives are to: ·
Support, promote
and assist with the development of co-operatives. ·
Provide
financial and non-financial assistance to co-operatives. ·
Provide business
support services, including pre-registration support, registration, business
plan development, mentorship and after-care to co-operatives, as well as
access to market services to co-operatives. ·
Provide
education and training to co-operatives. ·
Provide access
to information regarding all products, programmes and services available to
co-operatives. ·
Research any
matter affecting the effective, efficient and sustainable functioning of
co-operatives and the co-operatives organised sector. ·
Refer
information on co-operatives that the Agency has supported to the Tribunal in
the event that such support was not successful. ·
Carry out the
independent review reports on behalf of the qualifying primary co-operatives
and ensure such co-operatives submit these reports to the registrar. ·
Develop and
maintain data on co-operatives in partnership with the registrar, relevant
national and provincial departments, municipalities and other role players. |
September 2014 |
Co-operatives Tribunal |
Their main responsibilities will be to: ·
Adjudicate
in respect of any application made in terms of the Act relating to challenges
faced by co-operatives in relation to decisions by the registrar regarding
matters such as registration and de-registration of co-operatives. ·
Assist in respect of conflict or dispute resolution
matters referred to it. ·
Assist in respect of the process, reference, and
processing of the requested dissolution, winding-up or liquidation of a
cooperative. ·
Assist with the enforcement of and compliance with the
provisions of this Act. ·
Assist the Registrar of cooperatives to maintain and
update the cooperative database and registration database. ·
Provide technical support in respect of any matter
pertaining to a co-operative that has been transferred to it by the Agency
regarding to dispute and conflict resolution. ·
Have regard to international developments in the field of
co-operative law ·
Refer matters pertaining to a cooperative that has been
transferred to it by Agency for Judicial management in accordance to the Act. |
September 2014 |
National Council for Indigenous Knowledge |
The National Council will report directly
to the Minister. It will be responsible to: ·
Advise the Minister
on any matter concerning indigenous cultural expressions or knowledge; ·
Advise the
registrars of patents, copyright, trade marks, and designs on any matter
relating to the registration of indigenous cultural expressions or knowledge. ·
Advise the Minister
on matters relating to traditional performances. ·
Advise on the
integrity of a database of intellectual property in relation to indigenous
cultural expressions or knowledge. ·
Refer any dispute
received to an appropriate adjudication institution. ·
Recommend to the
Minister appropriate measures to ensure the effective implementation of the
Act in relation to all matters pertaining to indigenous cultural expressions
or knowledge relating to performers’ rights, copyright, trade marks, designs
and patents. |
December 2014 |
National Trust for Indigenous Knowledge |
The
National Trust will be responsible to: ·
Promote and preserve indigenous cultural
expressions and knowledge, including (i) the commercialisation and
exploitation of indigenous cultural expressions or knowledge for the purpose
of generating income; (ii) facilitating the development of indigenous communities
with respect to training on and awareness of their intellectual property and
associated rights; and (iii) assisting indigenous communities in the
application of this Act and other legislation dealing with indigenous
cultural expressions or knowledge. ·
Establish a Fund to be known as the
National Trust Fund for Indigenous Knowledge. ·
Administer the Fund and may invest monies
received from the commercialisation of indigenous cultural expressions or
knowledge or otherwise, pending the distribution thereof. |
December 2014 |
National Lotteries Commission |
The
National Lotteries Board will form the basis for the establishment of the
National Lotteries Commission. The Commission’s functions will also include: ·
Conducting research on worthy good causes
that may be funded without lodging an application and inviting applications
for grants from worthy good causes. ·
Promoting public knowledge and awareness
regarding lotteries and the process for applications for grants. ·
Managing the staff, and its financial,
administrative and clerical functions. ·
Exercising any other function as delegated
or directed by the Minister or the board. |
September 2014 |
Special Economic Zones (SEZ) Advisory Board |
The SEZ Advisory Board will be responsible
to: ·
Advise the Minister on policy
and strategy in order to promote, develop, operate and manage Special
Economic Zones. ·
Monitor the implementation of
the SEZs policy and strategy and report to the Minister on an annual basis on
the implementation of such policy and strategy. ·
Consider an application for
designation as a SEZ and recommend to the Minister whether or not to approve
the application and grant a SEZ licence to the applicant. ·
Consider an application for
an operator permit and recommend to the Minister whether or not to approve
the application. ·
Consider an application for
the transfer of an operator permit and recommend to the Minister whether or
not to approve such application with or without any condition. ·
Liaise with licensees and
operators on the implementation of the SEZ strategic plans. ·
Report in the prescribed
manner to the Minister on progress relating to the development of SEZs. ·
Recommend to the Minister
whether or not to approve the decision by an operator to locate a new
investor in the SEZ. ·
Advise the Minister on
initiatives to market SEZs. ·
Assess and review the success
of SEZs in promoting economic growth and exports. ·
Conduct investigations on any
matter arising out of the application of this Act. |
December 2014 (will be confirmed upon
promulgation) |
1.5
Purpose of the report
The purpose of this
report is to provide an account of the committee’s work during the 4th
Parliament and to inform the members of the 5th Parliament of key
outstanding issues pertaining to the oversight and legislative programme of the
Department of Trade and Industry and its entities.
This report
provides an overview of the activities the committee undertook during the 4th
Parliament, the outcome of key activities, as well as any challenges that
emerged during the period under review and issues that should be considered for
follow up during the 5th Parliament. It summarises the key issues
for follow-up and concludes with recommendations to strengthen operational and
procedural processes to enhance the committee’s oversight and legislative roles
in future.
2.
Key statistics
The table below
provides a statistical overview of the committee’s activities. This includes the number of meetings held,
legislation and international agreements processed and the number of oversight
trips and study tours undertaken by the committee, as well as any statutory
appointments the committee made, during the 4th Parliament. These
are discussed in further detail in the sections below.
Activity |
2009/10 |
2010/11 |
2011/12 |
2012/13 |
2013/14 |
Total |
Meetings held |
48 |
54 |
51 |
56 |
74 |
283 |
Referrals in terms of legislation |
None |
2 |
1 |
4 |
5 |
12 |
Oversight trips undertaken |
1 |
1 |
1 |
None |
None |
3 |
Study tours undertaken |
None |
1 |
1 |
None |
None |
2 |
International agreements processed |
2 |
2 |
None |
2 |
1 |
7 |
Statutory appointments made |
1 |
None |
None |
None |
None |
1 |
Attendance of International conferences |
1 |
1 |
2 |
1 |
1 |
6 |
The table below provides an overview of the
core outcomes of the committee’s activities in achieving its strategic
objectives.
Strategic
objectives |
Outcomes |
Refinement of legislation submitted for processing |
·
All legislation referred to the committee
for the period under review was significantly amended. Two pieces of
legislation, the Companies Amendment Bill and the Intellectual Property Laws
Amendment Bill were redrafted by the committee. ·
The Broad-Based Black Economic Empowerment
and the National Credit Amendment Bills attempt to accelerate the
transformation of the South African economy. The committee effectively
scrutinised these pieces of legislation to ensure that this is achieved. ·
Public participation was enhanced through
the effective use of print, radio and social media that elicited significant
submissions on legislation therefore enhancing the legislative process. ·
The period under review saw a significant
increase in the number of submissions received on legislation with the
committee providing sufficient opportunities for public involvement. ·
Although the committee did not initiate any
legislation, two of its Members submitted Private Member’s Bills for
consideration. The committee significantly refined
legislation, enhanced public participation in the legislative process, and
was the first committee to consider Private Member’s Bills. |
Improvement of its oversight over the institutions falling under its
Portfolio area |
·
For the period under review the committee
developed mechanisms to enhance its oversight over entities falling under its
portfolio. Public engagements and oversight visits were undertaken in the
execution of its oversight responsibilities. ·
The committee took an informed decision
that it would annually determine the entities under review to ensure more
detailed oversight. ·
The committee received regular quarterly
reports on the financial and non-financial performance of the DTI as well as
the entities under review. In the 5th Parliament, the committee
should receive quarterly financial and non-financial performance reports for
all entities in writing regardless of whether these are under review for a
particular financial year. ·
Through these regular engagements, the
committee was able to effectively monitor the trends in relation to the
budget and service delivery of entities and were, in the cases of the NCC,
CIPC and NRCS, able to immediately engage them to raise the committee’s concerns.
·
The committee also effectively monitored
the implementation of the Industrial Policy Action Plan (IPAP) through annual
reports and engagements. Three sets of public hearings were also scheduled in
relation to IPAP which resulted in the tabling of three IPAP-related reports.
·
During its oversight over the
implementation of IPAP, it came to the committee’s attention that high
administered prices could potentially derail the implementation of IPAP. In
response, the committee held a colloquium with relevant stakeholders related
to electricity charges and port tariffs to find a solution. As a result of
this engagement, Transnet announced that it would review its port tariff
structure to support industrialisation and the export of value-added goods. ·
The development of an oversight mechanism
with other relevant committees in Parliament to ensure complementarities and
coordination remains a challenge. This is highly significant in the context
of IPAP, which relies on a co-ordinated approach among government departments
and public institutions for it to be successful. ·
The effective oversight over the
implementation of legislation is also a challenge. The committee in the 5th
Parliament should develop a mechanism to oversee the implementation of
legislation and its impact on society. |
Dealing with
International and Regional Trade Relations |
·
Currently no framework/mechanism exists for
Parliament to express a view on trade negotiations. ·
The committee’s study tour to the WTO
effectively establishing the basis for its oversight over trade and created
an opportunity to effectively engage other international institutions. ·
Through its oversight, the committee
received regular briefings on the status of and developments within on-going
trade negotiations. This provided a platform for the committee to consolidate
its view on these negotiations. ·
The committee’s participation at
international trade fora, such as the 8th and 9th WTO
Ministerial Meetings, the 5th BRICS Summit, COP17 and the IAF
Meeting for Parliamentarians, has contributed to its understanding of trade
and other related matters and allowed it to offer support to the Minister at
these fora. It also provided committee members with a platform to engage with
their international counterparts and to actively participate in the domestic
and international debate. ·
The committee effectively dealt with all
agreements and conventions that were tabled for ratification. |
Improvement of the knowledge and skills of its members to deal with the
complex, technically demanding matters placed before the committee |
·
The committee initially received training
on international trade. This was then supplemented by workshops and/or
seminars on trade related matters. In addition, the committee’s study tour
played a pivotal role in entrenching this learning to understand aspects of
international trade relations. ·
The committee also spent a substantial time
engaging with the WIPO and the ICTSD on intellectual property and indigenous
knowledge and/or traditional cultural expressions to empower it to deal with
the Intellectual Property laws Amendment Bill which was of highly technical
and complex nature. ·
As was required, the committee engaged
various experts to provide technical support in relation to legislation and
used study tours and/or oversight visits to enhance their understanding. |
Dealing with matters of public interest |
·
During the 4th Parliament, the
committee provided a platform for members of the public to discuss matters of
public interest, such as: o
The socio-economic impacts of gambling. o
The status of transformation within the
horseracing industry. o
The rise in unsecured lending and its
impact on the poor. o
Product labelling. o
The impact of the steel and administered
prices on industry. o
Small business development. ·
The committee still needs to develop clear
criteria for identifying issues of public interest and on how to effectively
incorporate matters arising for follow-up into its oversight plan to ensure
that there is transparency and accountability in terms of addressing critical
issues. |
Discharging of statutory functions |
·
During the period under review, the
committee discharged their statutory functions with the recommendations of
the appointment of the Chairperson of the National Lotteries Board and its
Board members. ·
The committee was solely responsible for
the interview of candidates and after the completion of the process made the
necessary recommendations to the Minister. |
3.
Briefings/Public hearings other than on
legislation and on BRRR requirements
Informed by the DTI’s key priorities, namely
industrial development, trade relations and broadening economic participation,
the committee had extensive briefings and/or public hearings over the five year
period. These are briefly discussed below.
·
Industrial
development
The
Industrial Policy Action Plan (IPAP2) is the flagship programme of the DTI,
which was tabled on 18 February 2010 in Parliament. This was the result of a collective approach
among Ministers in the Economic Cluster and included consultation with
business, labour, state entities, and academia. The IPAP2 is considered a
rolling action plan, which is tabled annually and covers a three year period.
In 2010, the
committee held extensive public hearings and invited the relevant stakeholders
to comment on IPAP2. The rationale behind this decision was for the committee
to critically engage with stakeholders on IPAP2 and to develop a definitive
position. The committee report was adopted on 1 June 2010.
The committee has received regular updates on
the implementation of IPAP2 since August 2010. Each year, the committee
focussed on different IPAP-related issues, beginning with the cost of steel as
an essential input to industrialisation then infrastructure broadly. In 2012,
the committee focussed on the constraints posed by high and rising electricity
tariffs, port charges and other administered prices on the manufacturing sector
and IPAP2, as well as the critical need for beneficiation. This included a
consideration of current measures that had not been implemented and measures
that may require legislative action. One of the core outcomes of this
engagement was that Transnet committed to review their port tariff structure to
support beneficiation efforts.
·
Trade,
investment and exports
In 2009, the committee was requested to
provide input into the draft trade policy document, “A South African Trade
Policy and Strategy Framework: Discussion Document” (Trade Policy
Framework). The committee invited
several stakeholders including non-governmental organisations and academic
institutions to express their general views on the Trade Policy Framework. The
committee report was adopted on 12 May 2010 with the report being tabled to the
National Assembly for consideration.
In pursuing its oversight role over trade
related matters, the committee has engaged in a number of workshops, public
hearings and briefings from 2009 to the present. This included regular updates
on the DTI’s progress on on-going trade negotiations, as part of the annual
budget/strategic plan and budget review and recommendation processes, as well
as subject-specific activities such as (i) the Trade Seminar on barriers to trade, South African
trade policy and international trade agreements (25-26 August 2009), (ii) the workshop
on Intra-African Trade (16 May 2012) and (iii) the Workshop on South Africa’s
Trade Agreements and Relations (1 August 2013). A key highlight was the
participation of the members of the committee at the 8th and 9th
World Trade Organisation’s (WTO) Ministerial Conferences.
The DTI
had reviewed the status of the Bilateral Investment Treaties (BITs) which
resulted in the policy position to not renew its existing BITs and to develop a
framework for the promotion and protection of investment. The committee is
expecting a Bill to be tabled in the 5th Parliament formalising this
position.
·
Broadening
participation
Although this was a priority area for the
committee, the focus was on processing legislation in terms of the BBBEE and Co-operatives
Amendment Bills. (See section 4.)
·
Regulation
The committee focused on the Gambling Review
Commission Report. The committee engaged in the following activities:
·
Public hearings.
·
A workshop on online gambling with key
governmental and private institutions.
·
A site visit to Gauteng to acquaint itself
with the various forms of legalised gambling activities in South Africa and to
identify some of the challenges the gambling industry was facing, particularly
in terms of the existing legislation.
·
A site visit to the offices of the National
Responsible Gambling Programme (NRGP) in Kenilworth and the clinical assessment
and research component surrounding addictions (including gambling addictions)
at the University of Cape Town’s Department of Psychiatry and Mental Health.
·
A site visit to Kenilworth Racecourse focused
on gaining a better understanding of the horse-racing industry, as well as how
the totalisator functioned and betting with bookmakers occurred in this regard.
The committee made recommendations to the
Minister in a report adopted on 7 March 2012. These recommendations are still
under review by the Minister.
In addition, the committee held several
meetings with the South African Grooms Association. The Minister has undertaken
to facilitate discussions among all stakeholders within the horseracing
industry to address the issues of transformation within the industry.
3.1
Challenges
emerging
The following key
challenges emerged:
·
There is an over-reliance on the reporting by
the DTI and entities’ to determine their performance and level of service
delivery. Public participation, especially in terms of areas of regulation and
broadening participation, should be leveraged to strengthen the oversight
process.
·
Historically, the DTI’s entities have had a
record of good governance and financial management. However; recently, a number
of entities, especially newly-established entities, have started to show
challenges with respect to maintaining good governance and financial management
systems. This may be due to insufficient monitoring by the DTI.
·
Inaccessibility of
information such as international agreements, policies and strategy in the
public domain is a serious concern.
·
A challenge that
remains is that the committee is not always sufficiently informed about (1)
existing international obligations and developments at international
institutions, e.g. the World Intellectual Property Organisation, (2) policy
developments and (3) task teams within South Africa that affect the work of the
DTI. This has resulted in situations where seemingly incoherent or conflicting
policies have been adopted.
·
The committee tends
to receive late correspondence with regard to important conferences being
hosted by the DTI or its entities. These conferences provide a wealth of
insight into areas that the committee oversees and are invaluable to attend.
·
Implementation of the Industrial Policy Action Plan has been hampered by constraints arising
from uncoordinated approaches among departments that have led to a rise in the
cost of doing business.
·
The National
Consumer Commission had received a qualified audit report for the 2012/13
financial year due to lack of documentation of certain procurement activities,
which were allegedly stolen from its office. This is expected to remain a
challenge during future audits for a number of years.
·
There has been a
lack of cohesion in the implementation of national gambling policy among
national and provincial gambling authorities, which has not been resolved after
more than five years. Furthermore, transformation within the horse-racing
industry has been slow with grooms being one of the few stakeholders in the
industry not being officially recognised.
·
The number of
boards for technical infrastructure institutions was considered to be
inefficient and not cost-effective, as well as not encouraging a cohesive
technical infrastructure framework.
3.2
Issues for
follow-up
The 5th
Parliament should consider the following thematic issues:
3.2.1
Industrial
development
·
Assessing the
effectiveness of the implementation of the Industrial Policy Action Plan. This
should include ascertaining the view of stakeholders in terms of the usefulness
of interventions in strengthening the targeted industries. Furthermore,
Parliament should ensure that there is a minimisation of
constraints in terms of the cost of doing business.
·
Assessing the
effectiveness of incentives in meeting their set objectives.
·
Deliberating on the
first National Industrial Participation Programme report tabled in December
2013. A second report is expected to be tabled. This report should cover the
performance of projects under the non-defence portion of this Programme.
·
Overseeing how
South Africa’s technical infrastructure institutions (i.e. NMISA, NRCS, SABS and
SANAS) are gearing up to support new initiatives outlined within
government policy and legislation; and whether there is adequate capital
investments being made to ensure that state of the art technology is being
used, especially in core areas of support. In addition, reviewing the use of a
single board to ensure a more cohesive technical infrastructure framework.
3.2.2
Trade,
investment and exports
·
Overseeing ongoing trade negotiations
including receiving stakeholder input on schedules for the Southern African
Development Community (SADC) Trade in Services Protocol, the Tri-partite Free
Trade Agreement, the WTO Doha Development Agenda, the India-SACU (Southern
African Customs Union) Preferential Trade Agreement, the SADC-EU (European
Union) Economic Partnership Agreement.
·
Overseeing regional integration efforts and
implementation of agreements at SACU and SADC levels.
·
Overseeing the use of trade mechanisms to
support industrial development such as the use of existing dispute mechanisms,
anti-dumping measures, countervailing duties and import tariffs. These should
take the impact on consumers into consideration.
·
Overseeing the
implementation of export incentives and the impact of the National Exporter
Development Programme.
·
Following-up on the status of the Export
Credit Insurance Corporation’s request regarding additional funding to support
the Interest Mark-up Scheme for exporters.
·
Engaging on the economic diplomacy role of
trade missions and South African embassies.
·
Engaging on the
work of the Committee on the Non-proliferation of Weapons of Mass
Destruction.
·
Reviewing the impact of the shift in the
trade regime from liberalisation to a more developmental approach underpinning
industrial policy on the South African economy.
3.2.3
Broadening
participation
·
Broad-based black economic empowerment: Overseeing the implementation of the new Codes of Good Practice and the
progress on the NEF’s request for its recapitalisation.
·
Small, medium and micro enterprises (SMMEs): Overseeing the
implementation of incubators to support the development of SMMEs and the work
of the Small Enterprise Development Agency.
·
Co-operatives: Encouraging the
development and mainstreaming of co-operatives within the formal economy.
·
Vulnerable groups: Overseeing the
implementation of the Youth Enterprise Development Strategy. Monitoring the
progress of the development of the National Strategic Framework on Gender
and Women Economic Empowerment and the
Informal Sector Strategy.
3.2.4
Regulation
·
Consumer
protection:
Overseeing the functioning of Memorandums of Understanding (MOUs) with other
consumer protection institutions, especially provincial offices, in terms of
referrals by the National Consumer Commission (NCC). Monitoring the NCC's
enforcement capacity in terms of appropriate human and financial resources to
effectively deal with complaints, investigations and litigation. Continue
monitoring progress in terms of regulations on product labelling for food
containing genetically modified organisms; and the resolution of complaints
regarding incorrect meat labelling.
·
Credit
regulation: Overseeing the status of implementation of
consumers’ access to credit, recourse for unfair or unscrupulous behaviour and
the effectiveness of the debt review process.
·
Gambling: Monitoring the status of the implementation of the committee’s GRC
recommendations especially in terms of interactive/online gambling. Requesting
a status report from the Minister on the outcome of the facilitation between
grooms, the National Horse-Racing Association and other horse-racing
stakeholders.
·
Intellectual
Property: Monitoring the development of the National Policy
on Intellectual Property and the effectiveness of anti-piracy or prohibition of
counterfeit goods initiatives.
·
Companies: Overseeing progress on the implementation of the Swedish Model for the
Company and Intellectual Property Commission’s call centre and modernisation of
its information technology systems. Overseeing the establishment and operation
of the Companies Tribunal. Overseeing the effectiveness of the
business rescue process.
3.2.5
Administration
·
Ensuring that
entities are more closely monitored or become more accountable to the Minister
in terms of their governance structures and financial performance. This should
include quarterly or even monthly reporting on these matters to the DTI.
·
Overseeing that the
DTI and its entities implement action plans timeously to address audit
findings.
·
Encouraging the DTI
to develop its staff particularly in areas of economic diplomacy and trade
negotiations to ensure the continuity of these efforts.
4.
Legislation
The following
pieces of legislation were referred to the committee and processed during the 4th
Parliament:
Year |
Name of Legislation |
Tagging |
Objectives |
Status of Bill |
2009/10 |
None |
|
|
|
|
||||
2010/11 |
Companies Amendment Bill [B40-2010] |
s76 |
To amend the Companies
Act, 2008, so as to effect certain legal-technical and grammatical amendments
in order to ensure the proper application and administration of the principal
Act subsequent to its commencement; to correct certain errors resulting in
inconsistency and ambiguity in the principal Act; to establish a proper
foundation for certain necessary regulations; to continue the mechanisms
established under section 335 of the Companies Act, 1973, which allow for the
transfer of registration of foreign companies to the jurisdiction of the
Republic; to further provide for companies trading under insolvent
circumstances; to extend the grounds for disqualification as a director; to
provide for the terms of office of members of the Companies Tribunal; and to
provide for matters connected therewith. |
Adopted by the
committee on 10 March 2011 |
Intellectual
Property Laws Amendment Bill [B 8B –
2010] |
s75 |
Amends the: ·
Performers’ Protection Act, 1967, so as to amend certain definitions
and insert new definitions; to provide for the recognition and protection of
traditional performances having an indigenous origin and a traditional
character; to provide for the payment of royalties in respect of such performances;
and to provide for recording traditional performances; ·
Copyright Act, 1978, so as to amend certain definitions and insert new
definitions; to provide for the recognition and protection of copyright works
of a traditional character; to provide for the establishment of a National
Council in respect of traditional intellectual property; to provide for a
national database for recording traditional intellectual property; and to
provide for the establishment of a national trust and a trust fund in respect
of traditional intellectual property; ·
Trade Marks Act, 1993, so as to amend certain definitions and insert
new definitions; to provide for further protection of geographical
indications; to provide for the recognition of terms and expressions of
indigenous origin and for the registration of such terms and expressions as
trade marks; and to provide for
recording traditional terms and expressions; and ·
Designs Act, 1993, so as to amend certain definitions and insert new
definitions; to provide for the recognition and registration of traditional
designs of indigenous origin; to create for this purpose a further part of
the designs register; and to provide for recording traditional designs. |
Redrafted Bill
adopted by the committee on 19 October 2011 |
|
|
||||
2011/12 |
Intellectual
Property Laws Amendment Bill [B 8B –
2010] Referred back by the President |
S76 |
The
content of the Bill remained the same; however, the Bill was retagged by the
JTM as a section 76 Bill. |
Adopted by the
committee on 2 May 2013 |
|
||||
2012/13 |
Co-operatives
Amendment Bill [B 17 – 2012] Co-operatives
Second Amendment Bill [B 18 – 2012] |
s76 |
On 25 May 2012, the Minister of Trade and Industry
introduced the Co-operatives Amendment Bill [B17-2012] (National Assembly –
proposed sec 75) and the Co-operatives Second Amendment Bill (National
Assembly – proposed sec 76). The Bills were referred to the JTM for
classification in terms of Joint Rule 160. According to the ATC dated 15 June
2012, the JTM in terms of Joint Rule 160(6) classified the Bills as section
75 Bills. Since both Bills were classified as section 75 Bills by the JTM and
since both deal with the same subject matter, i.e. amending the Co-operatives
Act, No 14 of 2005, the Committee agreed to consolidate the provisions of the
Co-operatives Amendment Bill and the Co-operatives Second Amendment Bill into
one Bill. The purpose of the
combined Bill was to amend the Co-operatives Act, 2005, so as to provide for
the substitution and addition of certain definitions; to provide for
associate membership of co-operatives; to provide for categories of primary
co-operatives; to provide for the national apex co-operative; to provide for
the annual submission of information to the registrar; to amend the
accounting practices and requirements for co-operatives by providing for
audit and independent review of co-operatives; to provide for the payment of
fees by co-operatives for the amalgamation, division, conversion or transfer
of co-operatives; to provide for the voluntary winding-up of co-operatives by
special resolution; to provide for the registrar to apply for a declaratory
order in respect of the liquidation process; to provide for the Co-operative
Tribunal to order the winding-up of a co-operative; to substitute the
Advisory Board with the Advisory Council; to provide for the establishment,
functions and powers of the Co-operatives Development Agency; to provide for
the funding and financial management of the Agency; to provide for oversight
and executive authority of the Agency; to provide for the establishment,
composition and functions of the Co-operatives Tribunal; to ensure compliance with the principles of
intergovernmental relations; to provide for intergovernmental relations
within the co-operatives sector; and to provide for the substitution of the
long title and the Preamble; and to provide for matters connected therewith. |
The combined, redrafted Bill [B 17B – 2012] was adopted by the committee on 9 November 2012 |
Broad-Based
Black Economic Empowerment (BBBEE) Amendment Bill [B 42 – 2012] |
s75 |
To amend the Broad-Based Black Economic Empowerment
Act, 2003, so as to insert certain definitions and to amend others; to
clarify interpretation; to provide for the remuneration of Council members;
to promote compliance by organs of state and public entities and to
strengthen the evaluation and monitoring of compliance; to include the
creation of incentive schemes to support black owned and managed enterprises
in the strategy for broad-based black economic empowerment; to provide for
the cancellation of a contract or authorisation; to establish the Broad-Based
Black Economic Empowerment Commission to deal with compliance of broad-based
black economic empowerment; to provide
for offences and penalties; and to provide for matters connected therewith. |
Adopted by the committee on 23 May 2013 |
|
|
National
Credit Amendment Bill [PMB 1 – 2012] |
s76 |
To amend the
National Credit Act, 2005, by clarifying the definition of consumer to exclude
business-to-business transactions and persons who purchase for purposes other
than personal consumption; and to
make provision for further relief for consumers by the suspension of interest
accrual on debt for a period of up to five years from that consumer being
placed under debt review; and to provide for matters connected therewith. |
Rejected by the
committee on 23 May 2013 |
|
||||
2013/14 |
Special
Economic Zones (SEZ) Bill [B 3-2013] |
s76 |
To
provide for the designation, promotion, development, operation and management
of Special Economic Zones; to provide for the establishment, appointment of
members and functioning of the Special Economic Zones Advisory Board; to
empower the Minister to establish the Special Economic Zones Fund; to
regulate the application, issuing, suspension, withdrawal and transfer of
Special Economic Zones operator permits; to provide for functions of the
Special Economic Zones operator; to provide for transitional arrangements;
and to provide for matters connected therewith. |
Adopted by the
committee on 31 July 2013 |
Protection
of Traditional Knowledge Bill [PMB 3 – 2013] |
s76 |
To protect traditional knowledge as a new
category of intellectual property; to provide how said intellectual property
rights will be protected; to determine what is eligible for traditional
knowledge intellectual property right protection and the conditions for the
subsistence or termination of said protection; to provide for ownership of
traditional knowledge intellectual property rights; to provide for the
duration, nature and scope of traditional knowledge intellectual property
rights; to provide for the enforcement of traditional knowledge rights; to
regulate the licensing of traditional knowledge intellectual property rights;
to provide for the establishment of a National Council in respect of
traditional knowledge; to provide for the establishment of a national trust
and trust fund in respect of traditional knowledge; and to provide for the
regulation on the applicability of the Bill to foreign countries; to provide
for the protecti0n of performer; and to provide for matter incidental
thereto. |
Rejected by the
committee on 6 November 2013 |
|
Lotteries Amendment Bill [B 21 – 2013] |
s75 |
To amend
the Lotteries Act, 1997, so as to amend certain definitions; to provide for
the establishment of a National Lotteries Commission; to provide for the
extension of the powers of the board; to provide for the licensing of an
organ of state to conduct the National Lottery; to provide for a clear
accountability process for the distributing agency; to provide for the
professionalization of the distributing agency; to eliminate overlapping
functions between the Minister and the board; to provide for the removal of
the reconstruction and development programme as a category entitled to be
allocated money of the fund; and to provide for matters connected therewith. |
Adopted by the committee on 2 October 2013 |
|
Legal Metrology Amendment Bill [B34 – 2013] |
s75 |
To provide
for the administration and maintenance of legal metrology technical regulations in order to promote fair trade and to protect
public health and safety
and the environment; and to provide for matters connected therewith. |
Adopted by the
committee on 29 October 2013 |
|
National Credit Amendment Bill [B47 – 2013] |
s76 |
To amend
the National Credit Act, 2005, so as to amend certain definitions; to provide
for the alteration of the governance structure of the National Credit
Regulator; to empower the Chief Executive Officer to delegate certain
functions to other officials of the National Credit Regulator; to provide for
the registration of payment distribution agents; to tighten measures relating
to debt counsellors and the conduct of their practices as debt counsellors;
to allow registrants to voluntarily cancel their registration; to empower the
Minister to issue a notice for the removal of adverse consumer credit
information; to provide for automatic removal of adverse consumer credit
information; to empower the National Consumer Tribunal to declare a credit
agreement reckless; to provide for the registration and accreditation of
alternative dispute resolution Agents; and to provide for matters connected
therewith. |
Adopted by the
committee on 21 February 2013 |
4.1
Challenges
emerging
There have been incidents where critical
concepts have been insufficiently defined by the DTI or it was unclear what the
intended structure and roles of implementing agencies were within new
legislation. This has led to unnecessary confusion among Members and the DTI
when deliberating on legislation and resulted in avoidable time delays.
4.2
Issues for
follow-up
The 5th
Parliament should consider:
·
Calling for new
regulations to be presented to Parliament for input before these are finalised
especially in terms of the BBBEE Amendment Act, Co-operatives Amendment Act,
National Credit Amendment Bill and SEZ Bill.
·
Reviewing the
implementation of new legislation within two to three years of these coming
into effect, in particular the implementation of new lines of accountability
for the distributing agencies of the National Lotteries Distribution Trust
Fund.
·
Ensuring that there
are sufficient awareness efforts regarding new legislation, particularly those
affecting vulnerable groups.
·
Overseeing the
status of entities established in terms of legislation passed in the 4th
Parliament, namely the BBBEE Commission, Co-operatives Development Agency and
Co-operative Tribunal. In addition, the conversion of the National Lotteries
Board into the National Lotteries Commission.
·
Overseeing the
status of Bodies reporting directly to the Minister namely the National Trust
and Council for Indigenous Knowledge and the SEZ Advisory Board.
·
Overseeing the
transition of industrial development zones into special economic zones.
·
Following-up on
consultations by the Minister with the Minister of Social Development regarding
the use of social grants as a form of income to determine the affordability of
a credit agreement for a grant beneficiary.
·
Encouraging the
Minister to engage the Minister of Justice and Constitutional Development to
review its legislation related to emolument attachment orders and debt
collection to align these with the spirit of the National Credit Amendment
Bill.
5.
Oversight trips undertaken
The following
oversight trips were undertaken:
Date |
Area Visited |
Objective |
Recommendations |
18 Sept 2009 |
Atlantis |
To investigate the impact of the global
economic slowdown on the local economic environment. The committee had
identified Atlantis as a community that was experiencing economic hardships
due to the current economic slowdown. |
The DTI should
follow-up with ITAC regarding Tedelex’s request for a tariff review on the
unassembled electronic components for the manufacturing of television. The DTI and its
entities should provide feedback on progress to resolve the concerns raised
by the community. |
|
|||
3-5 Aug 2010 |
Eastern Cape visiting Volkswagen South
Africa (VWSA), Coega IDZ, SEDA, Mzamo Wethu Cooperative, and the Zenzele Weaving
Cooperative |
As part of its oversight function, the committee
agreed to conduct an oversight visit to the Eastern Cape given the
predominance of the automotive sector in the province. The committee visited the Volkswagen
manufacturing plant, as well as an automotive component plant in the
province. This sector has been stressed as one of the backbones for
deepening the industrial base. Furthermore, the Coega Industrial Development
Zone (IDZ) is one of the most IDZs in the country. The committee selected to visit
Coega IDZ, as it is a hub for foreign direct investment and an
opportunity to create sustainable jobs. The committee also visited the Amathole Branch
Office of the Small Enterprise Development Agency (SEDA) in East London,
as SEDA plays a critical role in providing non-financial support to small
enterprises and cooperatives. The development of small enterprises and
cooperatives has been identified as critical for promoting employment
creation and broadening participation. |
The DTI together with the Economic Development
Department should intensify support for SMMEs and cooperatives through
development finance institutions as part of IPAP2 to successfully broaden
participation of historically disadvantaged groups and productive investment
in rural areas to grow the economy. A concern that arose was that the community
driven projects were not supported in a holistic but rather a piece-meal
manner. Therefore, the DTI should address the issue of lateral linkages with
entities falling under them in this regard and other Departments to avoid
unsustainable outcomes. The DTI in conjunction with National
Treasury should consider tax incentives linked to IDZs to attract investors
and promote the IPAP2 objectives. |
|
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18 - 21 Jul 2011 |
Gauteng (Sedibeng) and Northern Cape (Kathu) |
The committee embarked on an oversight
visit to the Gauteng and the Northern Cape Provinces visiting the CIPC, the
NCC, ArcelorMittal South Africa (AMSA) and Kumba Iron Ore Limited (KIO), as
well as the business hub established by KIO in Kathu. |
The CIPC submits a report on how it intends
to address the following: ·
The capacity constraints within the call
centre. ·
Processing of registration. ·
The vacancy rate at the CIPC. ·
Problems associated with their IT systems,
particularly the enterprise content management system. ·
The CIPC provide a progress report on their
18 month turnaround strategy. The NCC submits a report on how it intends
to address the following: ·
The late payment of
suppliers by the DTI. ·
Progress with
respect to the finalisation of the NCC website. ·
Progress on the
development of operational plans in relation to the NCC ·
The budgetary
constraints that impacts on delivery. ·
Progress on finding
a suitable office location for the NCC. The DTI submits a report on the resolution of the
challenges related to the handover process with the establishment of the NCC. The DTI submits
a report on all their incentives programmes by the first week of October 2011
with specific reference to the following: ·
The years/months
since implementation. ·
The number of
projects approved nationally (by province). ·
The value of
projects approved. ·
The total cost to
the fiscus. ·
The number of
direct jobs created as a result of the incentive programmes. ·
The cost per job. |
6.
Study tours undertaken
The following study
tours were undertaken:
Date |
Places Visited |
Objective |
Lessons Learned |
Status of Report |
19 – 23 Jul 2010 |
·
World Trade Organisation (WTO) · World Intellectual
Property Association (WIPO) · United
Nations Conference on Trade and Development (UNCTAD) · South
Centre ·
International Centre for Trade and
Sustainable Development (ICTSD) |
After deliberating on the Trade Policy in the first
part of the year, the committee took a decision to go to Geneva for an
intensive study visit to reach a broader understanding on trade related
issues from a wide range of stakeholders including the WTO directorate. |
The Director-General of the WTO, as well as
his Deputy, welcomed the interaction with parliamentarians and acknowledged
the value of engagements with lawmakers. Specifically applauding the
committee for initiating the programmatic requirements of the study visit
which would in future be used as a format by the WTO to expand the outreach
programme with legislators and other institutions. Views were expressed that
such engagements with lawmakers of WTO countries could enhance the workings
of the WTO and that such engagements could contribute to the completion of the
Doha Round of negotiations. The views of legislators and resolutions adopted
by respective parliaments were essential in supporting a country’s position. WIPO welcomed the engagement with the
committee and indicated that they are eagerly awaiting the outcome of the
current debate in South Africa on indigenous knowledge. WIPO would welcome
the conclusion of our deliberations on the Intellectual Property Laws Amendment
Bill as this legislation could be used as a benchmark for other countries
considering amending their Intellectual Property laws. In the committee’s discussion with UNCTAD, They
were of the view that the Millennium Development Goals do not focus on the
real development issues and that an alternative growth path should be
pursued. To achieve this, policies developed in this regard should be
supportive of the international architecture. This view was not prevailing in
the committee in its deliberations on trade policy and IPAP2. The committee
noted the contribution that UNCTAD could make if developing countries utilised
the research capacity of the institution. The committee’s engagement with the South
Centre highlighted key challenges faced by developing countries in the Doha
Round negotiations. Developing countries’ cooperation at key international
fora would enhance the possibility of ensuring a developmental outcome at the
Doha Round negotiations. This could only be achieved through the promotion of
South-South cooperation that would enhance their bargaining power. During the committee’s engagement with the
ICTSD, it became apparent that key experts in the field of intellectual
property were at the disposal of the committee. The committee’s visit to WIPO
did not provide sufficient information on indigenous knowledge and after a
strategic engagement with the Chairperson of the ICTSD it was agreed that a
workshop would be arranged at minimum cost to Parliament. The workshop proved
to further enhance the understanding on the Intellectual Property Laws
Amendment Bill, but highlighted key challenges faced by the committee with
respect to key principles. The committee noted the extensive focus on
the WTO processes which has broadened its understanding of the current debate
in the Doha Round as well as the engagements with key stakeholders in the
field of intellectual property that would contribute to the development of
legislation. The committee noted the presence/dominance
of officials from various countries of the South at the multilateral organisations
and the influence it had on determining the trade agenda. The committee is of
the view that recruitment of South African officials to these multilateral
institutions should be promoted and encouraged. Arising out of the experience of the
committee during the intensive study visit and the inclusion of the committee
secretary, content advisor and researcher, the committee was of the view that
there is a need for such study visits at the beginning of every fresh term
with the inclusion of key support staff. Secondly, the study visit could be
expanded to include a focused cross cluster of committees such as Economic
Development, International Relations and Co-operation, and the related select
committees. A recognition that greater synergy should
be developed between Inter-Parliamentary groupings and the committee where
appropriate. |
Report adopted by the committee on 17 November 2010 |
|
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29 Jul – 2 Aug 2012 |
Kenya |
To learn from the Kenyan experience with
respect to co-operative development as a strategy for wealth creation and poverty
reduction. To investigate the enabling
environment for co-operatives through a legislative framework, co-operatives
policy and strategy provided by the Kenyan Government |
The co-operative movement incorporates all
facets of Kenyan life, as people in high office, such as the President of
Kenya, as well as ordinary people belong to at least one co-operative. The
broad-based success of co-operatives in Kenya had much to do with a
prevailing attitude that favours co-operation, mutual responsibility, and
financial prudence to reach a common goal. This attitude towards
co-operatives is commendable. However,
this attitude is not as prevalent in South Africa, and will need to be
cultivated over time. The motto “Harambee” meaning to all pull together,
similar to our phrase, “Ubuntu”, should be the foundation for co-operative
development in South Africa. The Savings and Credit Co-operative
(SACCO) Societies dominate the co-operatives movement and are established
solely for savings, and the provision of loans and credit lines. Individuals cannot be members of two SACCOS
but can belong to more than one co-operative. Evident from its
interaction was the strong savings culture of the Kenyans, which is sadly
absent from the South African society. The absence of government support in
terms of social pensions and housing for the poor provides the necessary
incentive for individuals and households to save for the provision of
housing, education and retirement. Co-operatives are
found in a number of sectors of the Kenyan economy which include housing, and
agricultural products such as milk, tea and coffee. The banking sector
in Kenya is skewed towards providing access to finance to big business. The
high interest rate of 22 percent forces Kenyans to seek alternative avenues
to gain access to finance. The volatility with regard to interest rate
development does not provide the necessary certainty required when making
loans. The clear thread that
ran through nearly all of the presentations was that government should not
provide financial support for the establishment of co-operatives. The role of
the state should rather be to provide the enabling environment by
establishing a sound regulatory environment, a functioning dispute resolution
mechanism, and non-financial support programmes including education and
training. Limited discussions
on worker and consumer co-operatives prevented extensive engagement on the
matter which could have contributed to the committee’s understanding as it
relates to regulations and governance structures. An analysis of the
appropriate legislation as it relates to the Kenyan co-operative movement is
required to understand government’s initial and ongoing assistance to the
co-operative movement. The establishment
of an effective Tribunal would facilitate the resolution of disputes faster
and cheaper than courts. Field officers must
be in the municipalities to specifically train co-operatives and provide them
with the necessary services. Field officers must
have the necessary expertise within the co-operative sector that would enable
them to deal with matters as they arise. The Government must
look beyond providing direct financial support for co-operatives but rather support
co-operatives through non-financial means to ensure the survival and growth
of the co-operatives movement in South Africa. The DTI should
explore the possibility of establishing a closer relationship with its
counterpart in Kenya, the Ministry of Co-operatives and Marketing, to ensure
continued policy development with the co-operatives sector. With regard to
skills development, the DTI should establish a mutually beneficial exchange
programme with the Co-operative University College of Kenya that would
enhance the skills levels of persons working in the co-operative sector in
South Africa. The allocated funds
should focus on education and training, and the development of managerial
capacity, as well as administrative capacity and information technology
systems. |
Report adopted
by the committee on 29 August 2012 |
7.
International Agreements
The following
international agreements were processed and reported on:
Name of International Agreement |
Objective |
Status of Report |
Convention
on International Liability for Damage Caused by Space
Objects, tabled in terms of section 231(2) of the Constitution, 1996 |
To provide for effective international rules and procedures
concerning liability for damage caused by space objects and to ensure, in
particular, the prompt payment under the terms of this Convention of a full
and equitable measure of compensation to victims of such damage by States and
international intergovernmental organizations involved in the launching of
space objects. |
Adopted by the committee on 2 September 2009 |
Convention
on Registration of Objects Launched into Outer Space, tabled in terms of
section 231(2) of the Constitution, 1996. |
To provide for launching States to maintain a National registry for its space objects and to provide such information
for inclusion in a United Nations’ register. In addition, to report to the UN Secretary-General when a space object is launched into outer space. |
Adopted by the committee on 2 September 2009 |
|
||
Preferential
Trade Agreement (PTA) between the Southern African Customs Union (SACU) and
the Common Market of the South (MERCUSOR) |
To provide for tariff reductions on
selected goods being traded between SACU and MERCOSUR member states, namely
Argentina, Brazil, Paraguay and Uruguay. |
Adopted by the
committee on 1 March 2010 |
Agreement between
the Governments of the Republic of South Africa and Republic of Zimbabwe for
the Promotion and Reciprocal Protection of Investments |
To provide for a bilateral investment
treaty between South Africa and Zimbabwe to protect investors. |
Adopted by the
committee on 14 April 2010 |
|
||
Agreement between the
Government of the Republic of South Africa and the Government of the Republic
of Cuba on Economic Assistance |
To stimulate bilateral trade relations between South
Africa and Cuba. The package will be used to purchase goods and associated
services in the South African market. In addition, it will assist Cuba with
development of its agriculture as well as reconstruction of infrastructure
destroyed by hurricanes in 2008. |
Adopted by the
committee on 9 May 2012 |
Agreement on the
Amendment of Annex IV and VI of the Trade, Development and Cooperation
Agreement between the Republic of South Africa, on the one part, and the
European Community and its Member States, on the other part, regarding
certain agricultural products (referred to as the “Cheese Agreement”), tabled
in terms of section 231(2) of the Constitution, 1996. |
Amendments to Annexes of the Trade,
Development and Cooperation Agreement (TDCA) regarding certain agricultural
products. These include (1) an amendment to the “gross weight” of canned
fruit, and (2) amending the listing of some cheeses from the protected list
to the reserved list. |
Adopted by the
committee on 29 January 2013 |
|
||
SADC Protocol on Trade in
Services |
The main
objectives are to: ·
liberalise
intra-regional trade in services on the basis of equity, balance and mutual
benefit with the objective of achieving the elimination of substantially all
discrimination between State Parties and a liberal trading framework for
trade in services with a view to creating a single market for trade in
services; ·
to promote
sustainable economic growth and development in the region, thereby raising
the standard and quality of life of the people of Southern Africa; ·
enhance economic
development, diversification, local, regional and foreign investment in the
services economies of the Region; and ·
pursue services
trade liberalisation, while fully preserving the right to regulate and to
introduce new regulations; and enhance the capacity and competitiveness of
the services sectors of SADC countries. |
Adopted by the
committee on 23 August 2013 |
7.1
Challenges
emerging
The following
challenges emerged during the processing of international agreements:
·
There was usually insufficient time available
to interrogate the impact of international agreements and engage with other
affected stakeholders before the committee recommended approval of the
agreement for ratification.
·
Implementation of the Agreement between the Government of the Republic of South Africa and
the Government of the Republic of Cuba on Economic Assistance has been
hindered mainly due to the economic embargo on Cuba.
7.2
Issues for
follow-up
The 5th
Parliament should consider:
·
Overseeing the impact or implementation of
existing trade agreements, particularly the Agreement
between the Government of the Republic of South Africa and the Government of
the Republic of Cuba on Economic Assistance, the Zimbabwean bilateral
investment treaty, and the Trade and Development Co-operation Agreement
The Trade Facilitation Agreement which was
agreed to at the 9th WTO Ministerial Conference should be tabled in
Parliament for ratification. The new committee should consider the commitments
made in terms of the three categories; whether this will align with the other
SACU member states; and oversee its co-ordinated implementation.
8.
Statutory obligations
In terms of section 3(3) of the Lotteries
Act, 1997, the committee is required to make recommendations to the Minister
regarding the appointment of Chairperson of the National Lotteries Board. At
the request of the Minister, the committee also proceeded to make
recommendations for the appointment of other members of the Board. The
committee report was adopted on 6 November 2009. Subsequently, the committee
was requested by the Minister to make a further recommendation to fill a
vacancy created by the passing of a board member. There may be a need to review this subsection
in the Lotteries Act to provide clarity to the committee on its responsibility
with respect to the appointment of the chairperson and/or board members.
The committee has been tabling Budget Review
and Recommendation Reports since 2010 in terms of the Money Bill Procedures and
Related Matters Amendment Act. In fulfilling this requirement, the committee
considered the Budget Vote for Trade and Industry which included allocations
for certain entities, the strategic plans, and annual reports, as well as
quarterly financial and non financial performance reports, of the department
and selected entities. The committee decided to focus on the NCC and the CIPC
on an ongoing basis as both were newly established. The major challenge has
been that the deadline for compliance is not achievable, as the financial and
non-financial information for the full 18 period is not available yet. As the Parliamentary
Budget Office is not fully functional, the committee is not in a position to
make a well-informed recommendation for amendments to the budget.
8.1
Issue for
follow-up:
The committee
should consider whether adequate financial resources have been made available
for the establishment of new entities and the expanded mandates of existing
entities, as set out in new legislation.
The committee should request that the DTI submits quarterly reports on
its performance as well as that of its entities.
9.
Attendance of international conferences
Members of the
committee participated at the following international conferences:
Date |
Conference |
Purpose |
11-16 Oct 2009 |
60th International Astronautical
Congress (IAC), Korea |
To attend the Meeting for Parliamentarians and the opening ceremony. The International Astronautical Federation (IAF)
introduced a major segment for Parliamentarians to brief them on the
contribution of space science and technology to issues of sustainable
development. |
|
||
26-28 Sept 2010 |
61st IAC, Czech Republic |
To attend the Meeting for Parliamentarians and the opening ceremony. The IAF offers Members of Parliaments a well-defined and
organised platform for a dialogue with the traditional space community
(governmental representatives, agencies, industry, engineers and scientists)
on a global scale. The theme of the second Meeting for Members of Parliament
was “Space Systems in support of the
management of natural
disasters”. |
|
||
29 Jul 2011 |
Southern African
Customs Union’s (SACU) Regional Conference |
The Conference was
organized with the aim of bringing together government, academics, the
private sector and the public to discuss regional integration in relation to
the development of the SACU regional policies. The Conference covered: ·
Regional integration of SACU. ·
Regional industrial development policy. ·
The SACU revenue sharing arrangement. ·
Cross-border infrastructure. |
2-4 Oct 2011 |
62nd
IAC, South Africa |
To attend the Meeting for Parliamentarians and the opening ceremony. The IAF introduced a major segment for
Parliamentarians to brief them on the contribution of space science and
technology to issues of sustainable development. The focus topic of the third Meeting for
Members of Parliament was “The use of space technology for managing food,
water and energy resources”. |
15-17 Dec 2011 |
8th WTO Ministerial Conference, Switzerland |
To join the South African delegation to the
Ministerial Conference, engage with its parliamentary counterparts and to
oversee the progress made in relation to the Doha Round negotiations and to
understand the implications of decisions made at this forum, so as to ensure
a developmental outcome for trade negotiations. |
|
||
30 Sept – 2 Oct 2012 |
63rd IAC, Italy |
To attend the Meeting
for Parliamentarians and the opening ceremony. The IAF introduced a major segment for Parliamentarians to brief them
on the contribution of space science and technology to issues of sustainable
development. The focus topic of the fourth meeting will be “Satellite-based Applications – Tools for Policy Implementation and
Verification”. |
|
||
26-27 Mar 2013 |
5th BRICS Summit, South Africa |
To attend the Business Forum and Exhibition
hosted by the DTI at the BRICS Summit. The Business Forum and Exhibition
provided the platform for the business community from the BRICS countries to
share common ideals and challenges facing newly industrialised countries.
Attendance facilitated the establishment of relationships with international
bodies and engagement with the relevant parliamentary counterparts on matters
that relate to trade relations and the ratification of international
agreements and conventions. |
26-27 Oct 2013 |
BRICS Co-operative Meeting, South Africa |
To attend and participate in the 3rd
BRICS Co-operative meeting. The meeting was hosted by the South African
National Apex Cooperative (SANACO) in partnership with the DTI under the
theme: Partnerships for Development,
Integration and Industrialisation through Cooperatives. The aim of the
meeting is to facilitate bilateral and multilateral cooperation amongst
co-operative enterprises in BRICS countries. The meeting will provide an
opportunity for cooperatives to exchange ideas, experiences and information
on enhancing cooperatives development, possible collaboration and joint
ventures amongst cooperatives in the BRICS countries and Southern Africa. |
3-7 Dec 2013 |
9th WTO Ministerial Conference, Bali, Indonesia |
To join the South African delegation to the
Ministerial Conference, engage with its parliamentary counterparts and to
oversee the progress made in relation to the Doha Round negotiations and to
understand the implications of decisions made at this forum, so as to ensure
a developmental outcome for trade negotiations. |
9.1
Issue for
follow-up:
The committee
should consider continuing its involvement at the Meeting of
Parliamentarians, which precedes the annual IAC.
10.
Acknowledgements
The committee wishes to express its
appreciation for the co-operation of the Minister and the DTI and other
stakeholders in supporting the committee during the 4th Parliament. The committee also wishes to thank
its committee support staff in particular the the committee secretary, Mr A
Hermans, content advisor, Ms M Herling, the researcher, Ms Z Madalane, and the
committee assistant, Mr D Woodington, for their professional support and
conscientious commitment to their work.
The Chairperson thanks all Members of the committee for their active
participation during the 4th Parliament.
11.
Recommendations
The committee in the 5th
Parliament should consider:
·
Intensifying public participation especially
in terms of the thematic areas of regulation and broadening participation, to
assess the accessibility of the Department of Trade and Industry and its
entities and the quality of services delivered, as well as the effectiveness of
protection offered to consumers and distressed businesses.
·
Allocating a portion of its budget to enable
members and/or staff to attend important conferences that would enhance the
committee’s oversight role.
·
Requesting the Department of Trade and Industry
and its entities to submit quarterly performance reports.
·
Commissioning independent research on the
effectiveness of the Industrial Policy Action Plan and the Department of Trade
and Industry’s incentive programmes.
·
Requesting the Minister to provide a status report
on the implementation of the recommendations of the Inter-departmental Task
Team on Iron Ore and Steel.
·
Encouraging the consolidation of the boards
of technical infrastructure institutions into a single board to ensure
coordination between these institutions.
·
Requesting that the committee be allowed to
exercise its oversight more effectively in relation to trade-related matters,
such as trade fairs or pavilions, through oversight visits abroad.
·
Developing a process for active participation
during the negotiating phase of key trade agreements.
·
Requesting the Minister to table a status report
on the facilitation between the grooms and other horse-racing stakeholders to
address issues of transformation.