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TUESDAY, 14 SEPTEMBER 2000
____
PROCEEDINGS OF THE NATIONAL ASSEMBLY
____
The House met at 14:03.
The Speaker took the Chair and requested members to observe
a moment of silence for prayers or meditation.
ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS - see col
000.
NOTICES OF MOTION
Ms N G W BOTHA: Madam Speaker, I hereby give notice that on
the next sitting day of the House I shall move on behalf of
the ANC:
That the House -
(1) notes that, despite the outcries of Patricia de Lille
and Pagad that Ministers Maduna and Tshwete are
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accusing Pagad of the urban terror attacks without
having any proof, media reports have substantiated
the statements of the Ministers as the police have in
their possession a report by an ex-Pagad member
confessing to the involvement of Pagad in the urban
terror attacks;
(2) calls upon the hon Patricia de Lille to put the
interests of the safety and security of the entire
populace and the community of Cape Town first and
desist from appeasing mischievous sectoral interests;
and
(3) commends the police for their commitment to end the
spate of bombings.
[Applause.]
Mrs G M BORMAN: Madam Speaker, I hereby give notice that on
the next sitting day of the House I shall move:
That the House -
(1) notes that the Independent Electoral Commission will
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open its 15 020 voting stations on the weekend of 16
and 17 September 2000 to register voters for the
municipal elections;
(2) encourages all eligible voters to use this
opportunity to check their details, if they have
already registered, and if they have not yet
registered, to do so on these days so that they will
have the opportunity to vote for the party that will
put all the people first ...
[Interjections.]
(3) calls on all South Africans to stand up and be
counted by making their voices heard in the upcoming
municipal elections, and, in so doing, prove that the
recent acts of terrorism will not force any lawabiding South African citizens to suppress their
voices.
HON MEMBERS: Hear, hear!
Mrs L R MBUYAZI: Madam Speaker, I hereby give notice that
on the next sitting day of the House I shall move on behalf
of the IFP:
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That the House -
(1) notes that -
(a) the United Nations General Assembly has declared
16 September as the International Day for the
Preservation of the Ozone Layer; and
(b) South Africa, as one of the signatories of the
Montreal Protocol, is required to uphold the
principles of the Convention; and
(2) calls on the Government to -
(a) monitor the production, supply and use of ozonedepleting substances;
(b) provide Parliament and the country with annual
reports of the success being achieved as a result
of the measures being implemented by the
signatories; and
(c) provide Parliament with a list of those countries
defying the provisions of the Montreal Protocol.
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Ms P N MNANDI: Madam Speaker, I hereby give notice that on
the next sitting day of the House I shall move on behalf of
the ANC:
That the House -
(1) notes that Zithulele Combi, the first black dealer to
be awarded an exchange licence by the South African
Reserve Bank, has been named South Africa's best
entrepreneur for the year 2000;
(2) believes that our democratic dispensation has given
opportunities for black entrepreneurs to display
their skills and talent and reach their goals; and
(3) congratulates Mr Zithulele Combi on his achievements.
[Applause.]
Mnr F BEUKMAN: Mevrou die Speaker, ek gee hiermee kennis
dat ek op die volgende sittingsdag namens die Nuwe NP sal
voorstel:
Dat die Huis -
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(1) met ernstige kommer kennis neem van die ontwrigting
van 'n Demokratiese Alliansie-vergadering op Maandag,
11 September 2000, in die Macassar-woongebied,
Helderberg, deur 'n groepie ontwrigters, van wie
sommige T-hemde van die ANC aangehad het;
(2) met kommer waarneem dat dié optrede grens aan die
gedrag van die ANC se ideologiese bondgenoot, ZANUPF, voor en tydens die algemene verkiesing in
Zimbabwe ...
[Tussenwerpsels.]
(3) 'n beroep doen op president Thabo Mbeki om toe te
sien dat alle strukture en ondersteuners van die ANC
die reg van vrye politieke optrede en die reg van
politieke partye om vergaderings sonder ontwrigting
te hou, respekteer;
(4) enige pogings tot die ontwrigting en benadeling van
individue en politieke partye se reg tot deelname aan
die politieke proses en verkiesings ten sterkste
veroordeel; en
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(5) versoek dat alle politieke partye wat aan die komende
munisipale verkiesing gaan deelneem hulle tot die
nakoming van artikels 16, 17, 18 en 19 van die
Grondwet verbind, en aktief hulle ondersteuners
daartoe inbind.
[Tussenwerpsels.] (Translation of Afrikaans notice of
motion follows.)
[Mr F BEUKMAN: Madam Speaker, I hereby give notice that on
the next sitting day I shall move on behalf of the New NP:
That the House -
(1) notes with serious concern the disruption of a
Democratic Alliance meeting on Monday, 11 September
2000, in the Macassar residential area, Helderberg,
by a group of disruptors, some of whom were wearing
ANC T-shirts;
(2) notes with concern that this conduct borders on the
behaviour of the ANC's ideological ally, ZANU-PF,
before and during the general election in Zimbabwe
...
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[Interjections.]
(3) appeals to President Thabo Mbeki to ensure that all
structures and supporters of the ANC respect the
right of free political action and the right of
political parties to hold meetings without
disruptions;
(4) condemns in the strongest possible terms the
disruption and prejudice of the right of individuals
and political parties to participate in the political
process and elections; and
(5) requests that all political parties that are going to
be taking part in the coming municipal elections
commit themselves to complying with sections 16, 17,
18 and 19 of the Constitution, and actively hold
their supporters to that.
[Interjections.]]
The SPEAKER: Order!
Chief N Z MTIRARA: Madam Speaker, I hereby give notice that
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on the next sitting day of the House I shall move:
That the House notes that -
(1) after numerous appeals by the UDM urging the
Government, and, in particular, the Municipal
Demarcation Board, to consult traditional leaders on
the determination of electoral boundaries in their
areas of jurisdiction, the Chairman of the Board, Mr
Sutcliffe, has eventually relented and consulted the
House of Traditional Leaders in Bisho on the matter;
(2) this consultation is of no consequence any longer,
having come too late when the demarcations have
already been done; and
(3) the recalcitrance on the part of the Government and
its designated structures, the Municipal Demarcation
Board, reflects their reluctance to be transparent
and sensitive to public sentiment.
Ms M VERWOERD: Madam Speaker, I hereby give notice that on
the next sitting day of the House I shall move on behalf of
the ANC:
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That the House -
(1) notes that Martina Reuter, a foreign graduate
student, was forced to move out of shared
accommodation after being told that her black friends
were not welcome in the house;
(2) believes that such incidents of racism cause deep
offence to the majority of South Africans and deepen
the historical divides that so many of us have fought
so long to breach;
(3) urges the Human Rights Commission to investigate this
matter with the utmost urgency; and
(4) assures Ms Reuter that -
(a) this House is committed to her right to freedom
of association; and
(b) that such prejudices are not those of the
majority of South Africans.
[Applause.]
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Ms C DUDLEY: Madam Speaker, I hereby give notice that on
the next sitting day of the House I will move on behalf of
the ACDP:
That the House -
(1) notes with horror the actions of the four young men
who viciously killed two innocent young people and
attempted to kill a third just to steal their car;
(2) notes that these killers were found guilty and
sentenced to 35 years in prison, making them eligible
for parole after 25 years;
(3) acknowledges that it costs about R80,00 per day to
keep one person in jail, and that R80,00 per day for
four people for 25 years with only 10% inflation
amounts to over R11 million; and
(4) calls on the Government to stop punishing law-abiding
taxpayers and fulfil its biblical mandate to punish
murders correctly by reinstating the death penalty.
[Interjections.]
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The SPEAKER: Order!
Genl C L VILJOEN: Mevrou die Speaker, ek gee hiermee kennis
dat ek op die volgende sittingsdag namens die VF sal
voorstel:
Dat die Huis -
(1) kennis neem dat -
(a) 24 September 2000 Erfenisdag is en dat hierdie
dag die afgelope vier jaar gebruik is om 'n
konferensie oor die regte en belange van kultuur, taal- en godsdiensgemeenskappe in Suid-Afrika
te hou; en
(b) die bepalings van artikel 185 van die Grondwet,
wat moet uitloop op 'n Kommissie vir die regte
van gemeenskappe in Suid-Afrika, ook telkens by
hierdie konferensies 'n hoë prioriteit geniet
het;
(2) sy ernstige kommer uitspreek oor die feit dat daar
vanjaar nie alleen geen sodanige konferensie gehou
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word nie, maar dat die voorgeskrewe wetgewing hieroor
weer eens vir later jare uitgestel word;
(3) in die lig van die ANC-regering se gebrek aan erns
oor hierdie saak die Regering derhalwe versoek om aan
die saak die prioriteit te verleen wat dit verdien;
en
(4) erken dat nasionale taalwetgewing 'n dringende
behoefte is met 'n baie hoë prioriteit om uitvoering
te gee aan artikel 6 van die Handves van Regte.
(Translation of Afrikaans notice of motion follows.)
[Gen C L VILJOEN: Madam Speaker, I hereby give notice that
on the next sitting day I shall move on behalf of the FF:
That the House -
(1) notes that -
(a) 24 September 2000 is Heritage Day and that for
the past four years this day has been used to
hold a conference on the rights and interests of
cultural, linguistic and religious communities in
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South Africa; and
(b) the provisions of section 185 of the
Constitution, which should result in a commission
for the rights of communities in South Africa,
have time and again received high priority at
these conferences;
(2) expresses its serious concern not only at the fact
that such a conference will not be held this year,
but that the prescribed legislation in this regard is
once again being postponed for later years;
(3) in view of the ANC Government's lack of seriousness
regarding this issue, therefore requests the
Government to grant the issue the priority it
deserves; and
(4) concedes that national legislation pertaining to
languages is a pressing need with a very high
priority in order to implement section 6 of the Bill
of Rights.]
Ms H M MPAKA: Madam Speaker, I hereby give notice that on
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the next sitting day of the House I shall move on behalf of
the ANC:
That the House -
(1) notes that the Black Economic Empowerment Commission
yesterday outlined a comprehensive set of proposals
for a national strategy on black economic empowerment
to three parliamentary committees;
(2) congratulates the Black Economic Empowerment
Commission on having produced an impressive report;
and
(3) expresses the hope that the Government and Parliament
will further engage the commission with the aim of
refining and improving its proposals to accelerate
empowerment.
[Applause.]
Ms R TALJAARD: Madam Speaker, I hereby give notice that on
the next sitting day of the House I shall move on behalf of
the DP:
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That the House -
(1) notes that the recently released annual report of the
South African Reserve Bank shows a meagre growth rate
of 1% in the first quarter of 2000 and 1,5% in the
second quarter;
(2) expresses its concern that this low rate falls far
short of the projected growth rates announced by the
Minister of Finance in his Budget Speech, and that
the economy will have to stage a remarkable
turnaround in the 3rd and 4th quarters if we are to
reach the targets laid down by the Minister;
(3) further notes that this feeble performance contrasts
starkly with growth rates this year in other emerging
markets and a projected world growth rate of over 4%;
and
(4) calls on the Government to take all the necessary
steps to attract foreign direct investment as a
priority, and to ensure an economic turnaround in
South Africa to ensure that we link ourselves to the
dynamic cycle of growth in the world economy and in
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the other emerging markets generally.
HON MEMBERS: Hear, hear! [Applause.]
Mr M F CASSIM: Madam Speaker, I hereby give notice that on
the next sitting day of the House I shall move on behalf of
the IFP:
That the House -
(1) notes that -
(a) it is common cause that the magistrate's courts
of our land are underresourced, overburdened and
generally unable to mete out rapid justice; and
(b) the executive director of the Association of Law
Societies of South Africa has offered the
services of some of its 13 000 members, free of
charge, to the state to help out as relief
magistrates, relief prosecutors and so on;
(2) is perturbed that the Ministry and the Department of
Justice have not seized this generous offer with
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alacrity and gratitude; and
(3) calls on the Minister of Justice and Constitutional
Development to meet urgently with the executive
director, Mr Van Vuuren, to take the matter further
and to achieve the modalities that are necessary to
bring instant relief to the justice system.
Miss M N BUTHELEZI: Madam Speaker, I hereby give notice
that on the next sitting day of the House I shall move on
behalf of the ANC:
That the House -
(1) notes that the Job Creation Trust Fund has collected
R62 million for the purpose of creating jobs, which
will soon start providing employment;
(2) recalls that all ANC members of Parliament alone, out
of all the parties, contributed to this fund;
(3) commends Cosatu, Nactu and Fedusa, their organisers
and members - many from the lowest end of the salary
scale - for organising and contributing to this
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initiative; and
(4) calls on other civil institutions to follow the lead
of the trade unions in contributing positively to
resolving the challenges that face our economic
transformation and development.
[Applause.]
Dr S J GOUS: Madam Speaker, I hereby give notice that on
the next sitting day of the House I shall move:
That the House -
(1) welcomes the apology by Radio 702 talk show host,
John Robbie, for his rudeness towards the Minister of
Health;
(2) acknowledges a growing rift within the ANC regarding
the cause of Aids, and welcomes a document written by
leaders of the ANC's national health committee which
has called on the President and the Minister of
Health to publicly acknowledge that HIV is the cause
of Aids;
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(3) further welcomes the admission by Dr Essop Pahad that
President Mbeki's standpoint on the cause of Aids
should have been communicated and handled in a much
more effective manner; and
(4) challenges the Minister of Health, in the light of
this, to take up John Robbie's offer to be
interviewed by him once again and, this time, clearly
identify her standpoint on the cause of Aids to the
people of South Africa, who deserve a truthful and
unambiguous answer.
[Interjections.] [Applause.]
Ms A VAN WYK: Madam Speaker, I hereby give notice that on
the next sitting day of the House I will move on behalf of
the UDM:
That the House -
(1)
welcomes the latest Corruption Index released
yesterday by Transparency International as a
valuable tool for measuring the fight against
corruption on an annual basis;
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(2)
Page 21 of 177
calls on the South African Government to develop a
similar index for our country specifically, as a
necessity in the fight against corruption;
(3)
notes that South Africa still ranks 34th out of 90
countries;
(4)
acknowledges that we have not succeeded in improving
our record in the past year; and
(5)
commits itself, once more, to the fight against
corruption without fear or favour, as the watchdog
of society over Government.
Mr M R BALOYI: Madam Speaker, I hereby give notice that on
the next sitting day of the House I shall move on behalf of
the ANC:
That the House -
(1)
notes the decision by the South African Rugby
Football Union to impose massive fines on both the
Lions and the Blue Bulls for overstepping the quota
regulations in Currie Cup matches during the past
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month;
(2)
further notes that the Blue Bulls wing, Rayno
Hendricks, denied being injured in the game against
Border in East London when he was replaced by a
white player; and
(3)
welcomes Sarfu's disciplinary steps and hopes that
this will eradicate racist attitudes and practices
in rugby.
CONDOLENCES ON LOSS OF LIFE DURING SINKING OF SARDINE
TRAWLER
(Draft Resolution)
Mnr G Q M DOIDGE: Mevrou die Speaker, hiermee stel ek
sonder kennisgewing voor:
Dat die Huis -
(1)
kennis neem dat 'n sardyntreiler vroeër vandeesweek
aan die Weskus gesink het en twee bemanningslede hul
lewe verloor het;
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(2)
Page 23 of 177
kennis neem dat hoewel vyf bemanningslede gered kon
word, twee nog vermis word;
(3)
innige simpatie betuig met die naasbestaandes wat in
rou gedompel is deur dié tragiese gebeurtenis;
(4)
die reddingspan bedank vir hul vinnige optrede; en
(5)
die hoop uitspreek dat die soektog na die vermiste
bemanningslede suksesvol sal wees.
Goedgekeur. (Translation of Afrikaans draft resolution
follows.)
[Mr G Q M DOIDGE: Madam Speaker, I hereby move without
notice:
That the House -
(1)
notes that earlier this week a sardine trawler sank
off the West Coast and two crew members lost their
lives;
(2)
notes that although five crew members could be
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saved, two are still missing;
(3)
expresses sincere condolences with the families who
have been plunged into mourning through this tragic
event;
(4)
thanks the rescue team for its speedy action; and
(5)
expresses the hope that the search for the missing
crew members will be successful.
Agreed to.]
APPOINTMENT OF AD HOC COMMITTEE TO CONSIDER FORMATION OF
PAN-AFRICAN PARLIAMENT
(Draft Resolution)
Mr G Q M DOIDGE: Madam Speaker, on behalf of the Chief Whip
of the Majority Party, I move without notice:
That the House appoints an ad hoc committee to consider
the proposed formation of a Pan-African Parliament, the
committee -
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(1)
to consist of 21 members;
(2)
to exercise those powers in Rule 138 that may assist
it in carrying out its task;
(3)
to have power to confer with a corresponding
committee in the National Council of Provinces; and
(4)
to complete its task by 6 October 2000.
Agreed to.
AMENDMENT OF MOTION REGARDING 1TERM OF OFFICE OF MEMBERS OF
FIRST COUNCIL OF ICASA
(Draft Resolution)
Mr G Q M DOIDGE: Madam Speaker, on behalf of the Chief Whip
of the Majority Party, I move the draft resolution printed
in his name on the Order Paper, as follows:
That the motion adopted by the House on 12 September
2000, whereby the Speaker was designated to conduct the
lot to determine the term of office of members of the
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first Council of the Independent Communications Authority
of South Africa, be amended by substituting the Deputy
Speaker for the Speaker.
Agreed to.
REFERRAL OF COUNCIL FOR MEDICAL SCHEMES LEVIES BILL TO
PORTFOLIO COMMITTEE ON HEALTH
(Draft Resolution)
Mr G Q M DOIDGE: Madam Speaker, on behalf of the Chief Whip
of the Majority Party, I move the draft resolution printed
in his name on the Order Paper, as follows:
That, notwithstanding Rule 290(1), the Council for
Medical Schemes Levies Bill, upon its introduction, be
referred to the Portfolio Committee on Health for
consideration and report.
Agreed to.
REFERRAL OF GENERAL INTELLIGENCE LAW AMENDMENT BILL TO AD
HOC COMMITTEE
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(Draft Resolution)
Mr G Q M DOIDGE: Madam Speaker, on behalf of the Chief Whip
of the Majority Party, I move the draft resolution printed
in his name on the Order Paper, as follows:
That the House refers the General Intelligence Law
Amendment Bill [B 36 - 2000] to an ad hoc Committee of
the House for consideration and report, and for that
purpose establishes a committee in terms of Rule 214, the
committee -
(1)
to consist of 21 members;
(2)
to consider the Bill in accordance with Chapter
13 of the Rules;
(3)
to exercise those powers in Rule 138 that may
assist it in carrying out its task;
(4)
subject to the concurrence of the National
Council of Provinces, to confer with the
corresponding Council committee and the Joint
Standing Committee on Intelligence; and
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(5)
Page 28 of 177
to complete its task by no later than 5 October
2000.
Agreed to.
CONSIDERATION OF REPORT OF SA PARLIAMENTARY OBSERVER
MISSION TO ZIMBABWE
The CHIEF WHIP OF THE MAJORITY PARTY: Madam Speaker and hon
members, Dr Manie Schoeman, who is on the gallery, was one
of the members of the delegation sent by this Parliament to
Zimbabwe. [Interjections.] [Applause.] On 17 May 2000, this
House resolved to send an observer mission to Zimbabwe to
observe the general elections of that country and to report
to Parliament.
In carrying out this important mandate, the mission
observed the elections and did not make any interventions
into the electoral processes, nor interfere with the
internal political dynamics and debates in Zimbabwe. In
pursuing this mandate, the mission was open-minded, took a
balanced approach and did not reach any conclusions until
it had met all the relevant role-players.
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What was also important about this delegation was that it
was composed of various political parties representing
diverse constituencies. Yet it acted as a united delegation
representing Parliament and the people of South Africa. The
resolve to co-operate and discuss political differences
amongst ourselves and reach consensus enabled this
delegation to present to this House today a consensus
report that reflects what we saw, what we were told and
what we experienced.
The recent elections in Zimbabwe were a product of a unique
historical evolution and should, thus, be understood within
this historical context. Zimbabwe, formerly known as
Rhodesia, was a British colony from the late 1800s to 1965.
From 1965 to 1980 it was under the regime of Ian Smith. The
people of Zimbabwe, under the leadership of Zapu and Zanu,
waged heroic struggles against British colonialism and the
regime of Ian Smith. [Interjections.]
The people of Zimbabwe were liberated from colonial rule
following the Lancaster House agreement and voted for a new
democratic government in 1980. It is a matter of record
that there has been more than one general election in
Zimbabwe after the 1980 independence. It is also a matter
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of record that in the early 1980s, there was a violent and
bloody conflict in Matebeleland. Yet the June elections and
the pre-election violence have stirred a lot of controversy
in Zimbabwe, in the region and on the continent. It seems
that the rejection of the proposed new constitution, in the
referendum, was one of the most important aspects that
formed the political context within which the elections
were held.
The parliamentary delegation left home soil on 7 June 2000
to observe the period leading up to the general elections
and the two days of elections. During our stay in Zimbabwe
we received briefings from a wide range of political
parties, media organisations, organisations from civil
society and the SA High Commission. These briefings enabled
the commission to develop an overall picture of the
Zimbabwean situation.
The South African parliamentary delegation met and cooperated with observer missions from the region, from our
continent and from the wider international community.
Although we co-operated with these missions, we carried out
our tasks independently and objectively, and we present to
this House a report which was not influenced by any mission
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except ourselves.
The delegation further divided itself into six teams and
visited some of the key provinces. Their mandate was to
meet with the political parties, government departments,
police, provincial registrars responsible for elections,
and civil society to get briefings on the situation at
local level. The mission had to observe the progress of the
campaign, especially with regard to the prevalence of
violence and intimidation. The mission visited the
following provinces, namely Mashonaland East, Mashonaland
West, Masvingo, Manicaland, Midlands and Matebeleland.
In the provinces we observed the logistic preparations for
voting and the counting of ballot papers. We also
familiarised ourselves with the location of counting
stations. In our interaction with the role-players and
stakeholders in the provinces, a number of complaints were
raised with us. Many opposition parties were complaining
about the manner in which constituencies were demarcated
and alleged that the demarcation commission had displayed a
bias towards rural constituencies which were perceived to
be Zanu-PF strongholds. There was a problem with regard to
the manner in which soldiers in the Democratic Republic of
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Congo were to cast their votes.
The mission further received reports from the election
supervisory commission and opposition parties that this
commission had been stripped of real power and capacity to
fulfil its constitutional obligations. Reference was made
to the fact that the Registrar General had taken over the
function of accrediting domestic monitors. Other complaints
included the role of the public broadcaster, the Zimbabwean
Broadcasting Corporation, and the Zimbabwean police, which
were alleged to have been biased against opposition
parties. A major problem raised was the violence and
intimidation, particularly in the rural areas, in the
period leading up to the elections.
The mission received many reports of violence and
intimidation, both during briefings in Harare and during
briefings on its visits to the provinces. Some of this
violence appeared to be systematic, planned and aimed at
intimidating supporters of other parties and creating no-go
areas. In other instances the violence appeared to be more
a spontaneous result of the heightened political tension in
the country. There were numerous allegations of
intimidation in rural areas against farm workers in the
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form of the so-called ``re-education sessions''. Many
parties and organisations reported that the violence and
intimidation emanated mainly from the ranks of Zanu-PF. The
mission observed that no single party, however, seemed to
have the monopoly on the use of violence.
Despite these problems, the elections were characterised by
peace and calm and by a large turn-out on the two days of
general elections. Voting was conducted efficiently and the
counting process was characterised by a meticulous and
transparent process of reconciling votes cast and ballot
papers used. These were carefully scrutinised by polling
agents, observers and monitors. The voting and counting
processes on 24, 25 and 26 June 2000 proceeded very
peacefully. All the contesting parties indicated that they
would accept the outcome of the general elections.
The mission is of the opinion that despite incidents of
violence and intimidation in the run-up to the elections,
the results of parliamentary elections in Zimbabwe
reflected the will of the people of that country. Having
gone to Zimbabwe, the delegation has gained experience in
the monitoring of elections. We learned lessons which were
good and which could be adopted for our own conditions.
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There were also lessons which were bad and which we should
avoid at all costs.
Let me take this opportunity to thank the South African
parliamentary delegation. This delegation truly upheld the
best traditions of our Parliament. It represented
Parliament and carried and its responsibilities to the best
of its ability. I firmly believe that the presence of this
and many other delegations in Zimbabwe contributed to the
lowering of tensions and intimidation during the two days
of the general elections in that country. This delegation
deserves a round of applause for a mission accomplished.
[Applause.] I think this mission deserves a round of
applause from the opposition benches, too. [Applause.]
A word of thanks to the South African High Commission in
Zimbabwe for co-ordinating our programme and for ensuring
that we met all the important role-players and stakeholders
in Zimbabwe. Our mission would have been impossible without
their unqualified support.
Lastly, a word of thanks to the people of Zimbabwe for the
manner in which they conducted themselves during the twoday elections. We hope that the people of Zimbabwe will use
14 SEPTEMBER 2000
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the post-election period to deepen their democratic
processes and solve their problems amicably in the interest
of all Zimbabweans. [Applause.]
Mr M C J VAN SCHALKWYK: Madam Speaker, the collective sigh
of relief from within Zimbabwe and the neighbouring states
that the election did not end in total chaos and bloodshed
cannot erase the impressions of a tyrant who abused
democratic rules for self-serving objectives. A well-known
journalist, Thami Mazwai, said:
Mugabe's hands are dripping with the blood of political
opponents and other Zimbabweans who have been murdered.
President Mugabe realised, in the months leading up to the
elections, that nondelivery was likely to be the focus of
the campaign. His reaction was to play the race card in
order to divert attention away from his own failures. This
ploy was only partially successful, and the Movement for
Democratic Change managed to mount a truly multiracial
campaign in response.
With the benefit of hindsight, there are a number of
lessons that can be learnt from the Zimbabwean elections. I
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am not in the habit of quoting my colleague Jeremy Cronin,
but he stated that the comparison between South Africa and
Zimbabwe is irresistible. His analysis was that it is a
case of ... ``a ruling party with heroic liberation
credentials. But it has alienated the urban masses,
intellectuals, workers and professionals.'' Zimbabwe has
shown that, if political parties of this kind have to
account for their record of nondelivery, the race card
becomes very attractive.
Zimbabwe was a test close to home of our Government's
commitment to the vision of an African renaissance. The ANC
Government, in order to protect old friends, sacrificed its
own integrity with regard to our commitment to the African
renaissance, as well as what is right and what is wrong.
Kaizer Nyatzumba argued:
Turning a blind eye to violations of human rights,
because those violations happen to be perpetrated by
one's friends, is hardly a noble quality.
As was the case with the Aids conference, it required our
former President, Mr Mandela, to be the nation's and the
ANC's conscience when he said that the public itself must
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bring down these tyrants. Silent diplomacy was the wrong
approach, because it sent out the message that our
commitment to the African renaissance will always be
subject to the political friendships of the party in
government. Policies of quiet diplomacy have their place in
politics, but the limit of quiet diplomacy is the point at
which innocent lives are sacrificed. That test was failed.
The arrogance of power was clearly illustrated by the
statement of Zanu-PF vice-president, Simon Muzenda, as
quoted in the state-owned daily, the Herald:
Even if we put a baboon in Chivu, if you are Zanu-PF, you
vote for that baboon. Whoever we put, you vote for him.
When President Mugabe is not there, I run the country. If
I sign your death warrant, you will hang.
Although it can be said theoretically that the result on
the election day reflects the will of the people, that will
was distorted by pre-election intimidation and
manipulation. The International Republican Institute said
that, of the 90 elections the institute had observed in 40
countries since 1984 ``Zimbabwe's is the worst we have ever
seen''.
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Our participants in the parliamentary delegation - with the
exception of one - reported back that the mission was wellled by the ANC Chief Whip, Mr Yengeni, and that his conduct
and the handling of the mission was beyond reproach. There
was one exception, and that was the visit to President
Mugabe to which non-ANC members of the mission and of
Parliament were not invited. The fact that this meeting
took place in addition to the official ANC delegation's
presence in Harare was inappropriate. It conveyed the
impression that he spoke on behalf of all political parties
represented in the mission, and that the meeting was in his
capacity as leader of the mission, which was not the case.
This Parliament needs a formal and binding protocol which
is more comprehensive than a code of conduct to guide the
behaviour of future participants in such missions,
especially where they are the leaders of delegations, and
are supposed to act on behalf of everyone, and not on
behalf of partisan interests.
In conclusion, Zimbabwe can either be a preview of what may
happen in South Africa over the next few years, or it can
be a warning - Mr Cronin has argued that case very
convincingly. In South Africa over the next few years ...
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[Interjections.] Well, there are about a third of the MPs
on this side who agree with this viewpoint, and who agree
with Mr Cronin. This may happen in South Africa over the
next few years, or it can be a warning signal alerting us
to the danger of the arrogance of power.
Zimbabwe must also serve as a reminder of how dangerous the
racialising of politics in societies such as ours is. But,
above all, Zimbabwe is a reminder that race cards are not
trump cards. It can only divert attention away from
nondelivery for so long before the Government is called to
account for its failures. [Applause.]
Ms N N MAPISA-NQAKULA: Madam Speaker, hon members, on 23
June 2000 thousands of people across the length and breath
of Zimbabwe went to the polls to vote in an election which
the prophets of doom had predicted would either not happen
or would not be free and fair.
I want to present to the House our own experience of that
election, especially with regard to the question of
violence. Comments by experts and others in the run-up to
the election were so negative that it would not have been
out of place to have expected to be confronted by scenes of
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a country on the verge of collapse. So negative was the
assessment of that situation that it conjured up in one's
mind scenes of mad people carrying guns and other weapons
of war, running amok in the streets of the country's major
cities and the countryside.
But the truth was that people were clearly not under siege.
They went about conducting their normal daily business
freely, without any signs of fear or intimidation. That, at
least, was the picture we saw on our arrival in Zimbabwe.
However, when we started to interface with the
representatives of various NGOs, churches, trade unions,
political parties and members of that country's academia, a
different picture, which was disturbing, emerged. We
received reports of many instances of violent attacks on
potential voters. This, we were told, had started
immediately after the referendum on Zimbabwe's new
constitution in which the ruling PF party was defeated.
Veterans of the liberation struggle, who had initiated farm
invasions, apparently escalated that programme and, in the
process, introduced violence that also affected
farmworkers.
The farmworkers, we were told, were forced to attend what
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was referred to as re-education classes right through the
night. It would seem that they were subjected to propaganda
lessons on the history of Zimbabwe, the liberation struggle
and the need to support the ruling party in the coming
elections. It was also reported that supporters of the
opposition were attacked by supporters of the ruling party,
and their property destroyed. It was alleged that
government displayed complacency in dealing with the matter
and in some respects even colluded with the attackers.
It would seem that, following media reports on the
situation and international condemnation, the attacks
decreased. More pressure was applied on the perpetrators of
the violence by the arrival of the international observers,
which further reduced the levels of violence. Our
delegation decided that one of the first things we had to
do, given the reports of violence we were getting, was to
meet with the war veterans, as they called themselves, who
were reportedly spearheading the violence. The purpose was
to verify the allegations and to make it clear to them that
we were going to visit all areas of interest to us,
including the farms.
During our meeting with them it emerged that the war
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veterans to a certain extent had been involved in acts of
intimidation and violence against the farmworkers. Reports
that the government was not doing anything about the
violence were not entirely true. There was a daily
television programme on the national broadcaster which was
used by the police to give detailed reports of acts of
violence in different parts of the country. This programme
gave details of the number of attacks, perpetrators
arrested, their political affiliation and other details. It
was interesting to note that the perpetrators in the main
were supporters of both the Movement for Democratic Change
and Zanu-PF.
On the eve of the election there were major political
rallies of the two main contending parties where further
violence was reported. It was striking to note that there
was a very strong police presence at Zanu-PF rallies, but
at MDC rallies, in particular the one held in Harare, a
small police contingent was deployed. This, of course,
allowed people to commit acts of violence inside the
stadium and in full view of the international media without
any fear of police intervention. Indeed, the police never
acted against the perpetrators.
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On both the voting and counting days Zimbabwe remained calm
and peaceful. No incidents of violence were reported. This
was our experience in Zimbabwe. But this violence came from
both sides in a cycle of attacks and counterattacks.
Those South Africans who so often hide behind amnesia when
the ugly face of our past pops up should remember the
period in South Africa leading up to our own 1994 elections
in this country. Surely, we cannot have forgotten that part
of our history so soon. Witnesses have appeared before the
TRC to recount their own participation in acts of violence
in the run-up to our 1994 democratic elections and even
leading up to the local government elections.
Those from South Africa who have been calling for all
manner of punitive actions against Zimbabwe never called
for similar actions against South Africa, not even when it
became clear that there was a third force with connections
to the apartheid regime which was sponsoring violence in
our country. In fact, one of the most brutal incidents of
violence was the assassination of that gallant fighter,
Comrade Chris Hani, which forced the racist regime to give
South Africa a date for our first democratic election.
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Members will remember the massacre of the people of
Boipatong. Nobody demanded long before the elections in
South Africa that our polls should be declared nul and void
because of the violence. Indeed our elections have been
declared free and fair since 1994.
When Zimbabweans went to the polls in that country's
democratic election, there were many instances of violent
political attacks against potential voters, but the
elections happened and they were declared free and fair,
allowing the population of that country to elect a
democratic government of their own choice after many years
of brutal colonialism. Nobody was prevented from casting
his or her vote. Those who wanted to participate in the
election did so and, importantly, voted for the party of
their choice.
The people of Zimbabwe have spoken. As responsible members
of the international community, let us support our
Government, led by the President, in their efforts to
assist Zimbabweans on their road to political and economic
recovery. [Applause.]
Mnu M A MZIZI: Somlomo nePhalamende elihloniphekile,
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mangithathe leli thuba ngibonge kuwe Somlomo nePhalamende
elihloniphekile ngokuthi nasinika ithuba lokuyokwethamela
udaba nokhetho lwaseZimbabwe.
Ngibonga kumfowethu oyilungu likaKhongolose, uTony Yengeni,
owayehola lelo thimba lamanxusa. Walihola ngobuhlakani
nangobuqotho. Ngibonga nakozakwethu esasihambisana nabo
siya khona laphaya eZimbabwe nakuba sengidabuka nje
ngokuthi ngibabonga nje ozakwethu omunye wabo, owayeyilungu
ngale kwi-New NP, sengiyezwa makhathaleni useqembukile.
[Uhleko.] Kodwa-ke kukhona engikusolayo ngalokhu kuqembuka
kwakhe ngoba ngike ngezwa nasemsakazweni ekuseni nje
kukhulunywa ngendaba yokuthi abehluleli empini ka-De Lange,
ayebhekene kuyo no-Manie Schoeman, behluleka ukwehlulela
ukuthi ngubani owehluliwe. [Uhleko.] Ngiyamsola naye
uSoswebhu omKhulu ngoba phela umfowethu lo, u-Manie,
wayehamba naye eseqenjini lakhe. [Ihlombe.]
Ngamahlaya nje lawo. Engihlose ukukusho lapha, uma ngibonga
kanjena, ngukuthi sasiye kokwethamela udaba lwaseZimbabwe.
Nanku-ke umbiko futhi engethemba ukuthi bonke abantu
bazowufunda uma bengaba nakho ukuthi bawufunde. Okumqoka
nakhu: Ngokwenkolo, kuye kuthiwe uma sebekhulumile ofakazi
ababili noma abathathu, basuke bekhuluma iqiniso. Kodwa
kwezombusazwe angikholwa ukuthi kuyasebenza lokho.
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ILUNGU ELIHLONIPHEKILE: Cha, akusebenzi.
Mnu M A MZIZI: Akusebenzi. Mangikusho lokhu ukuthi umbiko
esinawo lapha ngumbiko ohlanganisiwe waba ngumbonomunye.
Kodwa ngithanda ukuphawula-ke kulokho engakubona ngamehlo
enyama ngoba phela kukhona okunye esingakufakanga lapha
embikweni. Umbiko esinawo wawunemigomo esasinikezwe yona
yokuthi siyokwethamela laphaya, hhayi ukuthi siyoqapha.
Sasingayile koqapha.
Kwenzeka-ke izimo eziningi laphayana. Amalungu ayakhumbula
ukuthi kwakhulunywa kabanzi ngeZimbabwe singakafiki khona,
kodwa-ke ubuhlakani esabenza kwaba ngukubonana namaqembu
angaphakathi ezweni asinikeza imibiko eminingi.
Engingathandi-ke ukuthi kulahleke lapho ngukuthi kwaba
khona abanye abantu impela abalethwa phambi kwethu okuthiwa
bahlukunyezwa ngalokhu nalokhuya.
Kokunye ukuhlukunyezwa kwabo, ngiyakhumbula sikhuluma
nomame abasitshela ukuthi izikole ezazilinganiselwa e-150
zavalwa. Kwabaleka othishela kubonakala impela ukuthi impi
yabe seyingenile, isisemnyango. Kuyezwakala ukuthi
amakhosikazi abo adlwengulwa, edlwengulwa phela yizo
izigagayi lezo zempi. Lobo bufakazi asizange sibe nalo
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iqiniso eliphelele ngabo, ngoba phela umuntu ngeke akhuluma
ngento ayizwe ngomunye umuntu. Kuye kufanele into enjalo
iqiniseke enkantolo. Ngababuza ukuthi ngabe amacala
ayefakiwe yini enkantolo na. Baphendula bathi umuntu
wayengalifaka kubani icala enkantolo ngoba amaphoyisa
ayetsheliwe ukuthi zonke izinto eziphathelene nombusazwe
nombangazwe azingabikwa futhi ngeke zemukeleka. Akukho
nokuthi senzani lapho ngoba sabuka nje. Akukho cala
esalizwa lokudlwengula nanoma elani.
Ake ngingene kulolu daba lwezigagayi zempi. Empeleni, sabe
sesihlangana nazo izigagayi zempi. Kwakukhona umfo
kaHundzvi engezwa kuthiwa nguyena owayezihola phambili,
eyikhala eliphambili. UHundzvi wakubeka ngembaba. Sathi
sisaqala ukubonana nje naye, esacela ukusibiza ngamacomrades, ngathi: Cha, mfowethu, mina ungangibizi ngecomrade ngoba ngiyazi ukuthi ama-comrades angenzani
empilweni yami. [Uhleko.] Wavele wabhavuluka wathi:
UyiNkatha wena! Ngathi mina: Ehhe, usho khona impela.
Kwangethusa-ke ngoba wathi esuka wabe esethi: Uyabona wena,
Nkatha, yini ningezanga eminyakeni emine eyedlule lapha
eZimbabwe? Ngathi kuye: Uyabona, ukuba wawusicele
eminyakeni engama-20 eyadlula, sasiyokuza, kodwa-ke
sasingeke sigxambukele ezindabeni zaseZimbabwe
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singamenyiwe.
Kwaqhutshekwa nenkulumo kwathi uma sesibuza ukuthi uma
ngabe sesiya ezindaweni zasemapulazini ngabe kukhona yini
okwakuzophazamisa, njengoba babethi singazihlanganisi
nezindaba zamapulazi. Sasingayanga ukuyokhuluma indaba
yamapulazi laphaya, sasiyokwethamela inqubo yokhetho.
Kwabonakala ukuthi kwakubaphatha kabi ngempela lokho. Kwaze
kwathi uma esebhekisa ngakimi lo mfowethu onguzakwethu,
uMpontshane - angazi-ke noma ngabe wayenza ihlaya yini, wathi: Uyabona, uma niya laphaya emapulazini,
niyohlangabezana nembibizane engaphezu kwalokho enanikwenza
kuKhongolose nibagwaza ngemikhonto. Ngathi kuye: Hhayi-bo,
kahle. Uyaphaphalaza-ke manje wena, awusakhulumi khona.
Asizelanga lokho lapha. [Uhleko.]
Le ndaba yokufundiswa kabusha, yayingukuhlukumeza
okungaphezulu emphefumulweni nasenyameni yomuntu. Mina,
uqobo lwami, ngikwazi kahle lokho. Ngake ngathathwa
kwathiwa mangiye kotoyitoyiza enkundleni yezemidlalo ngoba
kwakuthiwa mangiphume emkhandlwini. Ngangiphoqelekile
impela ukuthi amadolo lawa ngiwalinganise nesilevu.
[Uhleko.] Ngangigijinyiswa yizingane zingigcwalisa inkundla
leyo. Ngahlukumezeka ngoba kwakuyinto engangingayithandi.
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Baqeda lapho baya emzini wami bafika bahlabelela ngendlela
yokuthi kwakungadilika umthangala wendlu, bethi mangingene
emzabalazweni.
Mayelana nalokho kufundiswa kabusha, linye ipulazi esaya
kulo. Uma sifika kulelo pulazi kwathiwa, cha, lapho-ke
abantu babehlabelela ubusuku bonke. Kwakungukuhlukumezeka
okungaphezulu lokho.
Akukhona okubi kuphela okwaba khona eZimbabwe. Kukhona
okuhle esakucosha lapho nengithanda ukuthi iNingizimu
Afrika ikwamukele ngoba kuyinselele. Amabhokisi abo okufaka
amaphepha amavoti awafani nalawa ethu amancanyana. Baphatha
ubhazabhaza webhokisi lamavoti okuthi uma kuphonswa kulo
kungalokho kushintshwa. Nalabo ababeqaphe amabhokisi
babeqapha ibhokisi elilodwa, balale phezu kwalo bebeke
izandla kulo. [Uhleko.] Awethu-ke ayalahleka lapha ngoba
maningi.
Ngale kwalokho, ubuchwepheshe babo bokwenza umsebenzi
wokhetho babukhombisa ukuba phezulu kakhulu kwezinga.
Ngakuthanda lokho. Ngakuthanda nokukhankasa kwabo. Lapha
eZimbabwe, njengoba i-Zanu PF umgomo wayo wokukhankasa
wawuthi ``Land is the economy,
economy is the land'',
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ngabona ukuthi i-Zanu PF yalanda into eyayisezinhliziyweni
zabantu. Yakhetha yona. Izigagayi yazisebenzisa kulokho-ke
ngoba zazihlala esangweni ziqaphile, ziqaphe ukuthi
kungabikho muntu weqembu eliphikisayo ozoya kokhankasa
amapulazini.
Ngakho-ke kithina Ningizimu Afrika ngabe siyayibona yini
ukuthi injani indaba yomhlaba? Uma abantu bengaze bafike
ekuthukutheleni, izoba yinkinga nakithi njengoba iyinkinga
eZimbabwe. Sasingayanga ngalokho. Asingenanga kulolo daba
ngoba sasesaba ukuthi uma umuntu ekhuluma ngezwe bazothi:
Emuva!
Njengoba nikhomba thina ngeminwe nje, le emithathu
ekhomba nina nithini ngayo? Ngakho-ke kuyinselele kithina
nakuHulumeni wethu ukuthi masikwazi ukulusheshisa nathi
udaba lungaze lube yimbibizane, lube yinkinga kithi sonke.
[Ihlombe.] (Translation of Zulu speech follows.)
[Mr M A MZIZI: Madam Speaker and hon members, I would like
to take this opportunity to thank you, Madam Speaker, and
the honourable House for giving us a chance to observe the
elections in Zimbabwe.
I would like to thank the hon Tony Yengeni, who is a member
of the ANC and who also led the team of representatives. He
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led it with intelligence and honesty. I would also like to
thank my colleagues who were members of the team,
especially the former member of the New NP who, I have
recently been told, has left his party. [Laughter.] I think
there is something fishy about his defection because I
heard over the radio this morning that the judges in the
fight between De Lange and Mannie Schoeman failed to make a
ruling as to who the loser was. [Laughter.] I also blame
the Chief Whip because he was walking with the hon Schoeman
as he was representing his party. [Applause.]
Those are just jokes. What I want to say as I thankfully
talk like this is that we went to observe the situation in
Zimbabwe. Here is another report which I think people will
need if they have a chance to read it. The important thing
is that, in a religious context, if two or three witnesses
have spoken, what they have told is taken as the truth.
However, in politics I am not sure if that is the case.
An HON MEMBER: No, it does not apply.
Mr M A MZIZI: It does not apply. I must say that the report
that we have here is the report that has been agreed to by
all. However, I would like to point out what I see because
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there are things that we did not include in the report. The
report that we had contained instructions concerning the
places in which we would observe the elections. We were not
there as monitors.
Many different things happened. Members will remember that
a lot of talks were given about Zimbabwe before we went
there. The wise thing we did was that we met with political
parties in Zimbabwe and they gave us different reports.
What I want to mention is that there were people who were
brought to us. We were told they had been victimised in
different ways.
According to the women we talked to, the victimisation they
suffered included the closure of about 150 schools.
Teachers ran away since it was thought that war was
imminent. It was reported that women were raped by war
veterans. We did not get enough evidence to support those
claims because one cannot rely solely on what one has
heard. Such claims should be proved in a court of law. I
asked them whether the cases had been reported to the
police. They asked to whom they could have reported the
cases because the police had been told not to record any
politically related cases. They said they did not do
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anything, they just watched the situation. There were no
cases of rape that we heard of.
Let me focus on the issue of war veterans. In fact we did
meet with the war veterans. There was Mr Hundzvi who, I was
told, was the leader of the war veterans. When he asked
permission to call us comrades I said to him: ``Please,
brother, do not call me comrade, because I know what
comrades did to me.'' [Laughter.] He exploded and said:
``You are an IFP member!'' I said: ``Yes, you are
absolutely correct.'' It surprised me because then he said:
``Look, you in the IFP, why did you not come to Zimbabwe
four years ago?'' I said to him: ``Look, if you had asked
us 20 years ago, we would have come. However, we would not
have interfered in the affairs of Zimbabwe uninvited.''
A long discussion went on. When we asked whether it would
be a problem if we went to farms they said we should not
get involved with the farm issues. We did not go there to
discuss farm issues. We were there to observe the
elections. It was clear that they were not comfortable with
that. By that time my colleague, the hon Mpontshane,
pointed out to me that if we went to the farms, we would
encounter difficulties that would be more serious than what
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we did to the ANC when we stabbed them with assegais. I do
not know whether he was joking. I said to him: ``No, stop.
You are out of order now. We are not here to discuss
that.'' [Laughter.]
The issue of re-educating people involved terrible
victimisation affecting body and soul. I myself know that
very well. I was once taken to a stadium where I was told
to toyi toyi as a means of forcing me to leave the IFP. I
was forced to fold my knees so much that they touch my
chin. [Laughter.] Children forced me to run all over the
stadium. I was traumatised because I was doing something I
did not like. From there they went to my house and sang
loudly so that the stone wall supporting my house could
fall. They were forcing me to join their struggle.
Concerning the re-education of people, there was only one
farm that we visited. When we got there, we heard that
people had been forced to sing the whole night. That was a
terrible abuse.
There was nothing bad that we found in Zimbabwe. There were
good things we found there which I want South Africa to
take as a challenge. Their ballot papers were not like
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ours, especially the little ones. They had a big box and
when they threw papers in it there was no need to change
the boxes. Even election monitors were monitoring only one
box. They slept next to it and laid their hands on it.
[Laughter.] Our ballot papers get lost because there are
too many.
Besides that, their technology regarding the elections
proved to be at a higher level. I liked that. I liked the
way they conducted their election campaigns. As the policy
of the Zanu-PF in Zimbabwe says: ``Land is the economy,
economy is the land''. I noticed that the Zanu-PF was
campaigning for something that was near to the heart of
many people. It chose to concentrate on it. It used war
veterans as police since they were sitting at the gate
policing. They were there to ensure that no political
opposition was going to campaign on the farms.
The question is, here in South Africa, do we see how
serious the land issue is? If people reach a stage where
they get angry, the land issue will be as big a problem as
it is in Zimbabwe today. That was not the reason why we
went there. We did not touch the land issue because we were
afraid that if we talked about land they would say: Go
back! As you point a finger at us, what about the three
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fingers that are pointing at you?'' Therefore, this is a
challenge to us and to our Government that we should
quickly resolve this issue before it becomes a problem to
all of us. [Applause.]]
Dr C P MULDER: Madam Speaker, on a point of order: I am
sorry to bother you. It was really impossible to listen to
the previous speaker as there is a problem with these
systems. The problem is that one not only hears the
interpretation but also the speaker himself on the same
channel, which really makes it impossible to follow the
debate. [Interjections.]
The SPEAKER: Order! I have previously alerted the Table
that ever since the switches have been in operation matters
have become very difficult. It may improve the microphones,
but it does not work for the hearing devices, and I
understand that this problem is being addressed. I am
afraid that until the problem is resolved, we will have to
do the best we can. I would like to suggest to those
controlling the sound at the moment that, when there is
interpreting to which a large number of members are
listening, they tone down the sound from the microphones at
the podium. I hope that improves matters.
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Mr G B D McINTOSH: Madam Speaker, I think that you will
have appreciated, from colleagues Mzizi and Yengeni's
speeches, that when Dr Hundzvi told us that we would not be
welcome to visit the farms, both Mr Yengeni and Mr Mzizi
did not like that idea at all and were quite determined to
visit them.
I would like, on behalf of myself and my party, to thank
you and this Parliament for mandating us to go to Zimbabwe.
This Parliament has great authority and status when it
expresses itself as a Parliament rather than as members of
a party represented in Parliament. We can indeed be proud
of our Parliament, particularly when we put South Africa's
interests first for that Parliament. I believe that we did
that in a responsible way, and Mr Yengeni was our leader.
Our presence in Zimbabwe was significant, unique and
important. The significance was because of our democratic
and nonracial Parliament. Ordinary Zimbabweans admire and
respect our democracy and economic prosperity. We were
unique because no other observer group consisted only of
members of Parliament. We were important because Zimbabwe
is umbilically linked to South Africa. The Matebele and the
whites migrated into that country, and still play a key
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role.
South Africa and Zimbabwe are powerfully linked in economic
terms. We trade with them. They owe us hundreds of millions
of rands. We can buy vegetables from Zimbabwe at Woolworths
in Cape Town. It is estimated that as many as one million
Zimbabweans work in South Africa. Many have studies and
still are studying at our institutions. It is a small
country with only 11 million people and 98% of them are
black Africans. Its national budget is similar in size to
that of the City of Johannesburg. They recognise that we
are a very powerful nation when compared to themselves.
The second thing which I learnt was that voters who read,
talk and are educated do not vote for racist agendas.
Zimbabweans, and particularly the ``born-frees,'' are welleducated. They have never had Bantu education. The people
value law and order, efficiency and progress.
President Mugabe's campaign was openly racist in chanting
``Pasi amaBunu'' [``Down with the boers''] and tribal in
talking of indigenisation, which is a codeword for
promoting the interests of the Shona clans. President
Mugabe spoke at two Mass or Star rallies at which I was
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present and, on both occasions, he was four hours late. His
utterances were anti-white, anti-British and he promoted
the lawless and violent invasion of commercial farms to
intimidate workers and farmers.
Today, in Business Day, Dr Edison Zvobgo, one of his former
Ministers, a Zanu-PF member and a member of Parliament,
summed it up when he said that the land invasions had
tainted what was a glorious revolution, reducing it to some
agrarian racist enterprise. Voters, whether black or white,
do not keep their brains nor their money in their skins.
The voters of Zimbabwe wanted delivery and economic
development. They are no different from voters around the
world. That is a lesson we should all learn for South
African politics. [Interjections.]
Allied to this was the commitment of the people of Zimbabwe
to vote. I think the real message is that free and fair in
Africa is complicated - my colleague, Mrs Mapisa-Nqakula, I
think over-simplified the issue ... [Interjections.] The
point is that we need to recognise the fact that the people
of Zimbabwe have struck a blow for democracy in Southern
Africa. From nowhere, a party that had existed for nine
months was able to mobilise 50% of the voters to support
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it.
Mr Mugabe's activities have done severe damage to South
Africa and our region. He has been like a child playing
with matches, with all our futures. Almost single-handedly,
he is making a joke of the African renaissance. Our
President should tell him that. In the late 1950s the
President, at least the then Prime Minister of South
Africa, had to tell Mr Ian Smith that he had to settle and
organise himself. It is time we did the same to President
Mugabe.
I believe that this delegation has served the cause of
democracy well, and I hope that members will read this
report when it comes out. I am disappointed that they do
not have it on their desks already. [Applause.]
The SPEAKER: Hon members, I will draw your attention to the
fact that the report has been published in the
parliamentary papers, and I hope members have actually read
it before the debate.
Mr M E MABETA: Madam Speaker, hon members, I would like to
start off by thanking the hon Yengeni for his report and
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the hon Mapisa-Nqakula for her remarks. These are important
to our party, for two reasons. The first reason is that the
hon Yengeni recognises the important negative role played
by tensions and violence in Zimbabwe in the elections. The
hon Mapisa-Nqakula's remarks about the unequal distribution
of police at voting stations is also very important. These
two remarks, I think, will go a long way towards helping
Southern African countries to plan an effective mechanism
for organising free and fair elections.
I would like to say to the hon Mr McIntosh that the
significance of this particular group in observing those
elections was not because of the white farmers and the land
invasions. It was not because of his particular party's
interest in those elections. It was important for South
Africans historically, because we were paying tribute to
the very important role that the frontline states in Africa
and the people of Zimbabwe played in the brutal passage of
our own quest for independence in this country. [Applause.]
I do not expect him to fully understand and appreciate
that. We have a long way to go.
I would also like to state that the UDM warned that in the
run-up to the elections, intimidation was to be considered
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as a possible major problem, that elections would have to
be free and fair, and that elections would have to be
accepted by all. We know that before the elections took
place, international observers asserted that intimidation
was very high. Subjective and partisan statements made by
some observers from South Africa on the situation in
Zimbabwe were unhelpful and only served to exacerbate the
situation.
The situation in Zimbabwe is instructive in our country,
because here, too, the pre-election atmosphere was charged
with high levels of political intolerance and intimidation,
often without exception, resulting in the killing of
political opponents. Of course, the political intolerance
preceding the elections in Zimbabwe differed from the South
African scenario, because in Zimbabwe we had overt official
backing, sanction and orchestration of violence, whereas in
South Africa we had an insidious covert phenomenon which,
nevertheless, left one with no doubt that political parties
which had come to be known as common denominators in the
political violence in this country, were implicate.
We cannot be smug, therefore, about our own electoral
experience while pontificating about the Zimbabwean
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scenario. It is a historical fact that African political
systems are at their weakest or collapse during the phase
of changes in the regime, owing to government reluctance or
inability to manage this crucial phase.
The Zimbabwean government has been recognised. Their
Parliament is sitting. We accept and respect that in the
hope that the Zanu-PF party will honour and respect the
findings of the courts on the by-elections in those areas
where elections were challenged. We further urge the
Zimbabwean government to adhere to the UN plan for the
reversal of the socioeconomic decay and deterioration in
that country.
We also urge the UK government to bear partial
responsibility for the deterioration of political relations
in Zimbabwe, in so far as they have reneged on their
Lancaster House commitments. Our own Government will do
well to demonstrate its seriousness about positive
assistance to Zimbabwe by ensuring that political
intolerance and intimidation are addressed in our own
country. [Time expired.]
Mr D K MALULEKE: Madam Speaker, hon members, I would like
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to thank this House and the DP for the opportunity to serve
the cause of democracy by representing the South African
Parliament in observing the Zimbabwean elections. It was,
indeed, an honour and a privilege. The DA congratulates the
people of Zimbabwe on their determination to vote and on
demonstrating their commitment to democratic values.
What has just happened north of the Limpopo is a clear
signal to governments that think that because they have
liberated their countries, they have a trademark over them.
It is time they woke up and smelt the coffee. The people of
Africa are no longer prepared to be ruled by tyrants.
Multiparty democracy is in Africa to stay. No matter how
poor people may be, they know what they want and how they
would like to be governed.
South Africa and the world have a duty to assist the brave
people of Zimbabwe to rescue their economy from politicians
who would like to destroy the country just to stay in
power. We should respect the views of Zimbabwe's elected
opposition and oppose economic sanctions against Zimbabwe.
Our policy must be: firstly, economic engagement with the
people and, secondly, strong political sanctions against
the ruling party. We must be on the side of the poor, of
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enterprise and of economic good sense.
It does not make sense to displace some 3 million
farmworkers and their dependants, paralyse commercial
agriculture and risk famine in a land of plenty, by seizing
two-thirds of white-owned farms. President Mugabe says he
will settle 500 000 landless people on the farms. Even if
he succeeds, which is unlikely given Zanu-PF's track record
on land reform, this is less than a quarter of the number
of farmworkers who will lose their jobs and homes. South
Africa must oppose this plan.
Mr Mboweni complained to Parliament recently that as far as
foreign investors were concerned, the Limpopo was a river
between two provinces of South Africa. The real problem is
that the South African Government has not done enough to
correct this impression. When Zimbabwe's land invasions and
the persecution of the opposition began in February, South
Africa was like a neighbour who saw the house next door on
fire. We had two options: to ignore the blaze and risk
damage to our own land - hundreds of refugee farmers and
farmworkers have already crossed our borders looking for
asylum and work - or to help put out the fire.
Unfortunately, President Mbeki opted for a third course of
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action. He sat down and had tea with the arsonist until the
South African Government firmed up its stance on land
grabbing. [Time expired.] [Applause.]
Mr E I EBRAHIM: Madam Speaker, ladies and gentlemen,
political democracy in the form of a multiparty
parliamentary system is a concept that many countries in
the developing world are grappling with. At the end of the
day, the true test of parliamentary democracy is its
ability to create a better life for the people of that
particular country.
Our President made the following observation:
... none of us seek to impose any supposedly standard
models of democracy on any country, but want to see
systems of government in which the people are empowered
to determine their destiny and to resolve any disputes
among themselves by peaceful political means.
In Africa we have a vision and a mission of an African
renaissance, where we want to overcome the devastating past
and ensure that Africa becomes a continent of democracy and
peace, growth and development, and prosperity and the
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restoration of the dignity of all Africans. We shall have
to rely a great deal on the principles of collective selfreliance, and the achievement of our goals depends
critically on the collective interest of the developing
countries being effectively addressed. What is critical
here is the alleviation of poverty, the cancellation of
foreign debt, the flow of foreign direct investment, fair
trade and transfer of technology.
Any parliamentary election on our continent or, for that
matter, in the countries of the South, must be viewed
against the background of broader issues confronting the
developing world and the impact of globalisation on
developing countries. In a terrain where powerful global
forces have the power to destabilise and destroy entire
countries and economies, the successful holding and
maintaining, for decades, of a democratic multiparty
parliamentary system is an achievement to take note of.
Our region has set an example in the holding of democratic
elections. We held a democratic election in our own country
last year, and although sometimes marred by tension, it was
nevertheless a successful election. Mozambique, Botswana
and Namibia have had successful elections too, then
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followed Zimbabwe and now Mauritius. Although there is
still war in Angola and the DRC, we can state with
confidence that in the SADC region, multiparty
parliamentary democracy is, indeed, alive.
Our presence in Zimbabwe was due to our commitment to
encouraging, supporting and observing the workings of
democratic institutions in our region. The Zimbabwean
election was highly contested. Not since independence has
there been such fierce contestation in a general election.
We also found that the white community, for the first time
since independence, exercised their democratic right to
campaign and canvass, and eventually turned out in large
numbers to vote.
It is accepted that democracy must serve the interests of
many and not a few. International observing and monitoring
of elections should be an important component of any
democratic election, as long as those doing the monitoring
do not have a hidden agenda of their own.
The alternative to regular parliamentary elections is a
military dictatorship or a one-party state. The OAU has
already taken an important and significant step in denying
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membership of the community of African nations to military
dictators. A one-party dictatorship does not serve the
interests of the people and violates the fundamental
principles, of the Freedom Charter which states that ``the
people shall govern''. It is this principle that has
inspired Africans, and in the last decade we have witnessed
25 countries holding multi-party elections so that the
people can decide on the government of their choice.
We have witnessed democracy in Nigeria, and recently
President Diouf of Senegal gracefully handed over power to
his successor in an election. We see shining examples of
democratic elections on the African continent, even though
The Economist likes to contend that Africa is a hopeless
continent incapable of allowing its people to freely choose
their governments. The Zimbabwean election must be counted
amongst those that expose the lie of this Afro-pessimism.
The African renaissance, I would say, is still alive.
Mr Van Schalkwyk, in some respects, is probably right in
his confusion. Zimbabwe teaches us that if the white
minority refuses to share the wealth accumulated through
gross exploitation of the majority of the people, yes, we
could have a Zimbabwe-type of situation in South Africa.
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This is something which the hon member should not tell us,
but address to his constituency, namely the captains of
industry, the mining houses and the rural landlords.
[Interjections.]
At a meeting in Maputo the other day a German told us that
his visit to Africa taught him two important things. He
said that there are two important things that are close to
the African, and which have been a traumatic experience to
them. One is the question of slavery, and the other is the
question of land. Africans have been made slaves and their
land has been confiscated by the colonial invaders.
Currently the world is crying for compensation for the
Jewish people, because they suffered during the Holocaust.
It is correct that 50 years after World War II they should
get compensation. There is still a clamour that they should
be compensated. Nobody speaks of compensating the African
people for the atrocities they suffered during the period
of slavery and during the land invasion of Africa. If the
issue of compensation is raised, then, of course, the whole
cry of racism is brought to the fore. [Applause.]
Ms C DUDLEY: Madam Speaker, I would like to thank God and
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this House for the opportunity to participate in this
initiative which clearly contributed positively to a more
peaceful election in Zimbabwe. Many people said our
presence inspired a confidence which dispelled fear and
intimidation. We were received with friendliness and
encountered an overwhelming sense of anticipation,
excitement and determination to see change in Zimbabwe.
I remember how welcome we all felt when greeting the
Zimbabwean people with a wave and got an enthusiastic
response, until I realised that our greeting was received
as an open hand, and MDC supporters were thrilled. I did
not, of course, mention it to my ANC colleagues, but I
noticed a couple of days later that they had stopped
waving. For me it would, of course, have been very rude and
unfriendly to stop waving!
I was very impressed with Tony Yengeni's leadership of the
delegation. I congratulate you, Sir, on a difficult job
well done. I believe every member of the delegation should
be commended for the diligent and serious manner in which
they applied themselves to their task. Everyone left South
Africa determined to be impartial and unbiased. This,
however, was more difficult than most would like to admit.
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I was particularly impressed as ANC colleagues unexpectedly
found themselves on the defensive every time Zanu-PF, the
ruling party, was criticised. In spite of this, I know of
no member of the delegation who shrank from confronting the
facts, even when it was dangerous or difficult to do so.
[Interjections.] Balancing what we heard with what we
actually saw was no easy task as, in spite of concerns and
fears, Zimbabweans seemed determined to exercise their
democratic right to vote the way that they had intended.
It is, however, my personal opinion that farmworkers and
the rural people, especially those old enough to remember
the days of liberation warfare and the massacre by Zanu-PF
of huge numbers of Matebele, were thoroughly intimidated. I
believe many of them voted Zanu-PF fearing reprisals
against them personally and their communities collectively.
These threats were made by Zanu-PF leaders and Mugabe
himself. The land issue, although it was clearly being used
as an election ploy and a means of intimidating farmworkers
and rural people, was and still is an important concern.
However, most ordinary people were not even able to think
about land, as their concerns focused on Mugabe, whom they
blamed for their hardships and lack at every level. Women,
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in particular, expressed their contempt for Mugabe and his
wife, saying they could not be bought with a bag of sugar,
and that they refused to be treated like puppets and to be
used and abused. Women also complained of Zanu-PF using
rape and the threat of rape to intimidate them. From all
accounts, it was clear that Zanu-PF-were responsible for
the violence and intimidation tactics, but the report reads
that the mission observed that ``there was no monopoly on
violence''.
The DEPUTY SPEAKER: Order! Your time has expired, hon
member.
Ms C DUDLEY: However, there were reasons for this. I signed
the report with no reservations and believe it is a true
reflection of what the delegation observed.
The DEPUTY SPEAKER: Order! Your time has expired, hon
member.
Dr P W A MULDER: Mevrou die Speaker, in die wêreld het
Suid-Afrika se politieke leiers nog 'n groot mate van
geloofwaardigheid. Dit kan nie van baie Afrikaleiers gesê
word nie. Dit maak hierdie verslag en sy gevolgtrekkings
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baie belangrik. Hierdie verslag lyk feitelik en objektief
ten opsigte van die sake wat wel daarin bespreek word.
Opmerklik is tog die sake waarna glad nie verwys word nie,
en wat sonder twyfel ook 'n groot invloed op die verkiesing
en sy uitslag in Zimbabwe gehad het.
Ek verwys hier spesifiek na die besetting van blanke boere
se grond en die intimidasie en anti-wit rassisme wat
daarmee gepaard gegaan het. Ons as VF se probleem met die
verslag lê in die slotparagraaf, waar daar staan:
... the result of the parliamentary elections ... broadly
reflects the will of the Zimbabwean people.
Die VF verskil hiervan. Die uitslag verteenwoordig nié die
wil of die wense van die kiesers nie. Op sy beste kon die
verslag gesê het ``die gemanipuleerde wil van die
kiesers'', want die regerende party het dit nie op stemdag
nie, maar tydens die aanloop tot die verkiesing deurlopend
gemanipuleer, en dit maak so 'n gevolgtrekking misleidend,
wat ons betref. Ek sal vir agb lede 'n paar voorbeelde gee.
'n Gesonde demokrasie veronderstel dat kiesers ingelig word
en alle kante van 'n saak hoor voor hulle hul keuse maak.
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President Mugabe se party het ZIM$62 miljoen uit die
staatskas gekry vir hulle verkiesingsveldtog. Die
hoofopposisie, die MDC, het geen fondse uit daardie oord
gekry nie en moes hul eie fondse werf. Dit is nie 'n
billike verkiesing nie. Televisie in Zimbabwe is 'n
monopolie van die Zimbabwe Broadcasting Corporation.
Opposisiepartye het geen geleentheid op televisie gekry om
hulle saak te stel nie. Dit maak 'n normale demokrasie
onmoontlik, want mense is nie ingelig nie.
In 'n normale demokrasie is 50% stemme genoeg om 'n
verkiesing te wen, maar nie in Zimbabwe nie. Uit die 150
parlementêre setels kies president Mugabe 30 parlementslede
wat hy ná die verkiesing aanwys. Die opposisie moes dus 63%
van die stemme gekry het om die verkiesing te kon wen.
Daarvolgens sou die ANC in 1994 met hulle 62%-meerderheid
nie kon geregeer het nie.
Van die 5,1 miljoen geregistreerde kiesers het 1,2 miljoen
vir Zanu-PF gestem. Dit beteken Zanu-PF het 24% van die
stemme gekry, maar hulle het tans ongeveer 62% van die
setels. Teen hierdie agtergrond maak die VF beswaar teen
die sin in die verslag wat lui:
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... the result ... reflects the will of the Zimbabwean
people.
Suid-Afrika se internasionale geloofwaardigheid is só
belangrik, ons kan nie bekostig dat ons ter wille van goeie
verhoudings of ter wille van politieke korrektheid ons
geloofwaardigheid permanent daarmee heen laat gaan nie, en
ek dink die verslag kon deurgegaan het bloot as 'n
feitelike weergawe van wat daar gebeur het in plaas daarvan
dat ons lyk asof ons met hierdie gevolgtrekking Zimbabwe
wil ter wille wees. Ons weet Mugabe se posisie is tydelik.
Hy sal nie meer lank daar wees nie, en daarná moet ons met
die werklikhede saamleef. (Translation of Afrikaans speech
follows.)
[Dr P W A MULDER: Madam Speaker, South Africa's political
leaders still have a great deal of credibility in the
world. This cannot be said of many African leaders. That
makes this report and its conclusions very important. This
report appears factual and objective in regard to the
issues which are discussed in it. What is noteworthy are
the issues which are not referred to at all, and which
undoubtedly also had a big impact on the election and its
result in Zimbabwe.
14 SEPTEMBER 2000
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Here I am referring specifically to the occupation of white
farmers' land and the intimidation and anti-white racism
which went along with it. The problem we as the FF have
with the report is contained in the concluding paragraph,
in which it is stated:
... the result of the parliamentary elections ... broadly
reflects the will of the Zimbabwean people.
The FF differs with this. The result does not represent the
will or the wishes of the voters. At best the report could
have said ``the manipulated will of the voters'', because
the ruling party did not manipulate it on polling day, but
consistently during the run-up to the election, and, as far
as we are concerned, this makes such a conclusion
misleading. I will give hon members a few examples.
A sound democracy presupposes that voters are informed and
hear all sides of a matter before making their choice.
President Mugabe's party received ZIM$62 million from the
treasury for their election campaign. The main opposition,
the MDC, received no funding from that source and had to
raise their own money. That is not a fair election.
Television in Zimbabwe is a monopoly of the Zimbabwe
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Broadcasting Corporation. Opposition parties received no
opportunity to state their case on television. This makes a
normal democracy impossible, because people are not
informed.
In a normal democracy 50% of the votes are sufficient to
win an election, but not in Zimbabwe. Of the 150
parliamentary seats, President Mugabe chooses 30 member of
parliament whom he appoints after the election. The
opposition would therefore have had to obtain 63% of the
votes to be able to win the election. In these terms the
ANC would not have been able to govern with their 62%
majority in 1994.
Of the 5,1 million registered voters 1,2 million voted for
Zanu-PF. This means that Zanu-PF got 24% of the votes, but
they currently have approximately 62% of the seats. Against
this background the FF objects to the sentence in the
report which reads:
... the result ... reflects the will of the Zimbabwean
people.
South Africa's international credibility is so important
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that we cannot afford to lose our credibility permanently
for the sake of good relations or for the sake of political
correctness, and I think that the report could have gone
through merely as a factual version of what happened
instead of us looking as though we want to oblige Zimbabwe
with this conclusion. We know that Mugabe's position is
temporary. He is not going to be there much longer and
after that we will have to live with the realities.]
Mr S B FARROW: Madam Speaker, I just want to reiterate the
thanks to Parliament, my party and those members that
attended the observer mission for a job well done.
The Zimbabwean elections have come and gone and the results
are well known to the members of the House. Our report
notes that violence and intimidation did in fact occur
prior to the election, and Zimbabwean opposition parties
and their candidates, in certain areas, were unable to
canvass freely. This was confirmed by about 22 of the 27
stakeholder groups and many other private and personal
contacts that we made while in Zimbabwe. Most of it was
systematic and targeted, and clearly had the support of the
Zanu-PF government. At the end of the day, under very
adverse conditions of fear, threats and violence, democracy
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ruled. After 20 years, the Zimbabwean electorate, where
possible, voted with their heads as opposed to their hearts
in bringing an end to 20 years of one-party rule.
Without the rule of law democracy cannot flourish; without
a free press and media uncontrolled by government
influences, the electorate cannot be well informed of their
choices; without multiparty democracy within the various
spheres of government, the government cannot be held to
account; without clear legislation and policies properly
mandated by the electorate, chaos such as that experienced
by the expropriation of land and associated land invasions
will also be an occurrence here in South Africa; and unless
our police force is impartial, our public will have no
faith in bringing our criminals to book.
Much of Zimbabwe's economy is vested in the agricultural
and tourism industries, and the lack of rule of law there
has contributed primarily to Zimbabwe's present economic
mess. This has spilt over into our country and the region
in general. We must never allow the rule of law to be
undermined in South Africa. One of the best briefings which
we received was from the Zimbabwe Commercial Farmers'
Union. They conveyed their appreciation of our President's
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quiet diplomacy approach to President Mugabe, in particular
to the politically motivated land invasions that were
taking place before and during the elections. In retrospect
one wonders how effective this approach has been,
particularly in regard to the impact it had on Zimbabwe's
economy and the violence and killings that were associated
with it.
Nearly 40% of Zimbabwe's export earnings are derived from
agriculture and in addition agriculture contributes some
18% of the GDP. About 76% of the total population of the
country is entirely dependent on agriculture, yet President
Mugabe has senselessly attempted to damage this sector of
the economy. Our country has been intimately affected by
the bad governance of Zimbabwe and yet for lesser reasons
our Government chose to intervene in Lesotho. One wonders
why. [Time expired.] [Applause.]
Ms M C LOBE: Madam Speaker, comrades and colleagues, the
people of Zimbabwe have expressed their will in the June
2000 parliamentary elections. Through their votes they have
re-emphasised the fact that Zimbabwe will never be a colony
again. Indeed the people have spoken. They have spoken
loudly and clearly against discrimination, poverty,
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landlessness, hunger and disease. It is regrettable that
their pre-election campaign was characterised by violence.
We cannot deny the fact that even our own country's
elections have been characterised by these unfortunate
incidents.
The experience of Zimbawe and our own experience should be
a lesson to the rest of Africa that incident-free elections
are an integral part of a democratic society. The
Zimbabwean elections were run under the auspices of four
structures. The first was the delimitation commission which
was headed by a judge of the supreme court and was
responsible for dividing the country into constituencies.
The second was the registrar general who carries out all
registration responsibilities in that country including
voter registration, compilation of the voters' roll and
also providing the delimitation commission with the
necessary information to delimit constituencies. He is also
responsible for vote counting, the appointment of presiding
officers and staff and the announcement of results. It is
important to note that the registrar general has provincial
counterparts who handle such responsibilities at provincial
level.
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Thirdly, there was the election directorate, which is
constituted by senior representatives of relevant
government departments and is responsible for all
logistical arrangements for elections. Fourthly there was
the electoral supervisory commission, which oversees the
processes of registration, campaigning, voting and counting
of votes. This body also has the authority to pronounce
itself on the status of elections.
On the basis of briefings we received from both the
registrar general and the provincial registrars, and based
on our own observations, it was clear, even before the
elections, that the above structures had done thorough
preparations for voting and vote counting. However, we
received complaints regarding various aspects of election
preparation. For example, there were allegations that the
names of a number of dead people were still on the voters'
roll.
The DEPUTY SPEAKER: Order! Hon members, could you please
lower your voices, so that the hon member's speech can be
heard.
Ms M C LOBE: The registrar-general confirmed this
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possibility, but was confident that no one could vote on
behalf of a dead person due to tight procedures during
voting, which included the use of a voter's card and
indelible ink. There were also allegations that the ballot
boxes had removable bottoms, and that that would lead to
fraud. The mission took it upon itself to follow up this
matter and the allegation was proved to be unfounded.
As a result of the fact that a significant number of people
did not appear on the voters' roll, a supplementary voters'
roll was introduced to accommodate such individuals. This
supplementary voters' roll was not easily accessible to all
candidates because it became available at a very late date,
but it assisted a lot of Zimbabweans to exercise their
right to participate in the fifth parliamentary elections
in June.
Although the pre-election period was characterised by
tensions, a lack of political tolerance and violence,
especially on some commercial farms and in rural areas, the
voting and counting process took place in a peaceful and
calm atmosphere. It is very clear that the presence of
observers contributed to this calm and peaceful atmosphere.
The presence of a minimum of three police officers in each
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polling station also contributed to the peaceful conduct of
the elections.
The prophets of doom predicted a very low voter turn-out as
a result of violence, and that election days would be
characterised by incidents of violence. Much to their
surprise, more than 2,5 million votes were cast out of 5,1
million registered voters. About 50% of registered voters
cast their votes, which makes the process not only credible
but also legitimate.
The mission was impressed by the high voter turn-out, and
the discipline and commitment of voters, despite the long
queues. The mission was also impressed by the high levels
of efficiency and professionalism on the part of electoral
officers. In the interest of transparency and security, the
ballot boxes were guarded overnight by the police and
polling agents. These polling agents were provided with
transport to accompany boxes to the counting stations.
Although the process of counting took very long, it was
also extensive. This process was characterised by a
meticulous and transparent process of reconciling votes
cast with ballot papers issued. Any possibility of election
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fraud was ruled out by this extensive process. Despite all
the reports from some institutions and the media, it was
very clear that the election process in Zimbabwe was
efficiently run and had an equally efficient and committed
electoral staff.
As a country, we need to learn from this experience in
order to improve our own electoral system. It is against
this background that the ANC is convinced that the people
of Zimbabwe have expressed their will. Indeed, Zimbabwe
will never be a colony again. [Applause.]
Mr I S MFUNDISI: Madam Speaker and hon members, Africa
continues to suffer destruction in its political processes
because African cultures have been broken down by
imperialists' and colonialists' conquests. The result is
that the western type of political systems are then imposed
upon them, and some leaders remain caught in the rut.
The climate prior to the elections in Zimbabwe was heated
up owing to the land issue. There were sporadic acts of
violence and intimidation. Certain areas were declared
``no-go'' areas. In the run-up to the elections, tempers
cooled off, and the Movement for Democratic Change brought
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to light political and racial contradictions in Zimbabwe.
Two independent institutions, Amnesty International and the
Helen Suzman Foundation, made these discoveries. A climate
of terror did not create an environment which was conducive
to free and fair elections. Violence and intimidation were
most serious in rural areas, and the Zimbabwean print media
and the Zimbabwe Broadcasting Corporation disregarded
participants outside Zanu-PF. They concentrated only on the
ruling party.
However, at the end of the day, 82% of the voters believed
that the ballot was secret. The MDC won 57 seats against
the 62 seats won by Mugabe's Zanu-PF. This is despite all
the state machinery in the form of the army which was
assaulting supporters of opposition parties and the funding
which was at Mugabe's disposal. It is, therefore, not
illogical to say that had the elections really been free
and fair, and had public funding been equally accessible to
all parties, the MDC would have taken home the bacon.
The Zimbabwean election is a lesson to be learned by those
in power. It is not the bullet but the ballot that places a
party in power. Arrogance and intimidation do not help the
cause of any party. Though the terrain was uneven and the
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going was tough, the Zimbabweans did well under those
circumstances. The bottom line is that the findings of our
parliamentary delegation regarding the fairness and the
free nature of the elections in Zimbabwe are, by and large,
corroborated by Amnesty International and the Helen Suzman
Foundation. Under the circumstances, we would say: ``Well
done, colleagues.''
Dr S E M PHEKO: Madam Speaker, the PAC appreciates the
debate on the report on Zimbabwe. Zimbabwe and its
president, Robert Mugabe, have been the subject of
newspaper headlines, editorials, and television and radio
comments. Some of these comments have been negative about
Zimbabwe and its recent elections which were won by ZanuPF.
The PAC leadership met a delegation of Zanu-PF members in
Johannesburg before the elections. A PAC delegation
travelled to Zimbabwe during the elections to express
solidarity with the people of Zimbabwe regarding their land
dispossession by colonial invaders led by Cecil Rhodes. The
invaders called that country ``Rhodesia''. They evicted
Africans from the fertile land by force through the use of
arms, and no one then spoke of the rule of law and human
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rights. Consequently, 0,03% of the settler population owns
12 million hectares of land, that is, 73% of arable land in
Zimbabwe.
All that Mugabe and his colleagues demanded was that at
least 50% of this land be returned to 12 million landless
Africans wallowing in the quagmire of poverty, landlessness
and unemployment. Justice-loving people believe that
whatever mistakes Zimbabwe's president made on this
question of finally redistributing African land to African
people, he is 100% right. As a Kenyan observer put it,
``Mugabe's only fault is that he took too long to do it,
but now that he is doing it, people who believe in fairness
and justice must support him.'' Rather than prove anything
against Mugabe, the West's accusations only prove how
little it thinks of Africans' rights to own anything or
have meaningful independence. Could one even imagine a
situation in which 4 000 Zimbabweans would be allowed to
own 12 million hectares of land in Britain or France, or be
entitled to recover land they stole from the British or
French?
In this country our forefathers, in the wars of national
resistance against colonial aggression, fought to retain
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the land of their ancestors. They realised the importance
of this basic national asset. Wars of liberation, through
Apla and other forces, were also primarily about land.
Today this important asset has been compromised for flag
independence and confused with national anthems.
Unfortunately, although the Native Land Act of 1913 has
been replaced with section 25(7) of the South African
Constitution, it guarantees the properties of the haves,
which have been acquired. Their economic oppression and
their evictions from a small piece of land are a time-bomb.
[Time expired.]
Mr M MPEHLE: Madam Speaker, before I start delivering my
speech according to my notes, I would like to take off from
the point that was made by the hon Mzizi, who drew our
attention to the possible problems that could arise in our
case with regard to the question of land.
I want to take the opportunity to assure and re-assure our
farmers in this country that, for as long as they abide by
the laws of this Government and for as long as they do not
continue to paint our people's bodies with black paint,
they are safe in this country. The laws that we have made
guarantee them that, provided that they operate within the
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framework that has been set up by this Parliament and this
Government.
A number of previous speakers raised the question of land
in Zimbabwe. That is the topic I would like to deal with,
and I plead with all the hon members of Parliament here to
take and put the land question in Zimbabwe in its proper
perspective. I have not heard anyone here doing that job.
So, my job will be to provide a framework upon which we can
have a fruitful discussion in so far as the land situation
in Zimbabwe is concerned. But, to do this, I must
definitely give some historical background on what happened
to the land of the Zimbabweans when they were invaded by
the agencies of British colonialism, and what happened in
Lancaster House where there was a meeting and negotiations
for the resolution of the armed struggle in that country.
I should also warn and inform hon members that when
colonisers invade foreign lands, they grab, they kill, they
burn, they rape, and they loot. They herd together the
subjects in the most uninhabitable areas in the conquered
countries. They behave in the same way, be it in the
Americas, Asia or Africa. They never consider the long-term
consequences of their ungodly actions. They finally
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bequeath to succeeding generations complex and painful
problems whose solutions demand, at times, very painful
surgical operations.
Before we become judges - if that is what we must be - on
the question of the land problem in that country, or
whatever we want to call it, let us know and understand
fully what happened to the land question yesterday - that
is, in the past, before the Zimbabwean people gained their
political rights. What happened around this land question
in Zimbabwe yesterday enables us to understand what is
happening today in so far as the white farms in that
country are concerned; and that, in itself, gives us the
basis on which we can plan and analyse what is going to
happen tomorrow. The purpose of my speech is to provide a
framework within which we can have this discussion.
The land problem in Zimbabwe began in 1889 when Cecil John
Rhodes annexed that country. The annexation was in the
interest of the British South Africa Company and British
colonialism, wherein Cecil John Rhodes signed immediately
what is known as the Rudd Concession with the king of the
Ndebele, King Lobengula. The signing of that concession,
which was a trick by Rhodes, gave away that country to the
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British South Africa Company.
Of course, the signing of spurious treaties was fundamental
to the British policy of colonialism. Immediately after the
signing of the Rudd Concession, Rhodes organised hundreds
of white settlers and armed bandits. These white settlers,
together with these armed bandits, entered Zimbabwe and set
up their operational centre and base in what is today
called Harare.
When they realised that they had been cheated by Rhodes
through the infamous Rudd Concession, the Ndebele under the
leadership of their king, Lobengula, went to war against
the forces of the British South African Company in 1893.
The Ndebele were, of course, ruthlessly crushed. The defeat
of Lobengula's forces virtually gave the British South
Africa Company control over Matabeleland. Encouraged by its
escapades, the forces of the British South Africa Company
moved into the lands which were under the control and
jurisdiction of the Shona-speaking people.
In defence of their land, the Ndebele-speaking and Shonaspeaking people combined their fighting forces, but they
were defeated in 1897. This marked a new chapter for the
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people of that country in the struggle in defence of their
land, and at the same time, it was the opening of a new
chapter. Britain had become the colonial overlord of
Zimbabwe. Through a series of pieces of legislations,
Britain acquired control over the economy of Zimbabwe,
wherein funds from various activities in that country were
repatriated to the British Treasury in London.
In line with the British colonial policy in South Africa in
particular, the so-called native reserves were created in
Zimbabwe. Those of us who have lived - and continue to live
- in those areas which were designated native reserves will
tell all hon members about these areas. They will tell
about the condemned lives of those who were regarded as
God's stepchildren by the rulers of our country; and this
continued up to the dawn of the new political dispensation
in 1994.
By the beginning of the First World War, Zimbabwe had a
white settler community which made up 3% of the total
population, and which controlled 75% of all the
economically productive land. [Time expired.] [Applause.]
Mr C AUCAMP: Madam Speaker, may I start by congratulating
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the mission on a report that reflects thorough and
systematic work and is quite user-friendly.
Mr J H MOMBERG: Mooi, Cassie! [Well done, Cassie!]
Mr C AUCAMP: Unfortunately, that is where it ends, Oom
Jannie! [Laughter.]
The crux of the report is the conclusion that the results
of the election broadly reflect the will of the Zimbabwean
people.
Die vraag is of die vlag die lading dek. [The question is
whether the flag protects the cargo.]
In other words, is the conclusion at the end justified in
the light of the facts reflected in the report? I beg to
differ.
Op stemdag het dinge blykbaar heel goed verloop, maar wat
van die voorafgaande proses? In die verslag word die
volgende genoem: [Apparently matters ran smoothly on
polling day, but what about the preceding process? In the
report the following is mentioned:]
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... Zanu-PF ... received some Z$ 65 million per annum
from the State. All the other parties ... had to
fundraise from other sources.
Surely, the playing field was not level at all. Secondly,
the Zimbabwe Broadcasting Corporation, which, as the report
says, has a monopoly over the electronic media, gave
inordinate coverage to Zanu-PF. This is not a true
democratic process. To what extent was ``the will of the
Zimbabwean people'', as the report says, rather the will of
the ``ZABC'' inflicted on the people?
Die verslag maak melding van klagtes oor
kiesafdelingafbakenings, oor kieserslyste en oor 'n laat
aanvullende kieserslys, maar gee nie 'n uitspraak daaroor
nie. Oor die klagte ten opsigte van stembusse waarvan die
bodems dalk vals was, sê hulle dit is ongegrond. Moet ons
aanneem dat die ander klagtes wel gegrond was? Dit wat
betref die gebeure in die tydperk van 20 dae wat ons
afvaardiging daar was, maar wat van die maande vooraf?
Wat van die intimidasie, van die verontagsaming van die
beginsels van 'n regstaat? Demokrasie, veiligheid en
stabiliteit is oorboord gegooi toe gewelddadig van
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regeringskant op vreedsame optoggangers losgebrand is. Wat
van die totale verontagsaming van 'n bevel van die
hooggeregshof en die skending van die reg op vryheid van
uitdrukking van sy burgers en die eensydige steun van die
Zimbabwiese polisiemag aan wetverbrekers?
Kom ek gebruik 'n beeld. Die verkiesingswedloop het kop aan
kop geëindig. Zanu-PF en die MDC is amper gelyk oor die
wenstreep en almal sê wat 'n pragtige wedloop. Ons
afvaardiging kom daar aan nadat vier van die vyf rondtes al
verby is. Hulle kyk en hulle sê nee, die manne hardloop
mooi, hier kom 'n ding.
Intussen vergeet hulle dat die wegspring totaal ongelyk
was, dat die MDC vasgehou is deur onwettige inmenging en
blokkering, dat Zanu-PF die eerste paar rondtes op alle
onwettige maniere kortpad geneem het en deur ontoelaatbare
metodes die opponente van die baan af geskouer het. Ons
moet daarteen waak dat die kop aan kop uitslag ons oë sluit
vir die onreëlmatighede.
Verder moet ek sê dat die optrede nie die toets van
regverdigheid slaag nie. Sekere dele van die inhoud van die
verslag onderstreep dit, en die hele ondemokratiese aanloop
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die afgelope maand sê dit ook. My dank aan die afvaardiging
vir goeie werk, maar die AEB kan hom nie met die bevinding
van hierdie verslag vereenselwig nie. (Translation of
Afrikaans paragraphs follows.)
[The report mentions complaints about constituency
demarcations, about voters' rolls and about a late
supplementary voters' roll, but does not make any
pronouncements in this regard. As regards complaints in
respect of ballot boxes which possibly had false bottoms,
they say that these were unfounded. Must we accept that the
other complaints were justified? This in regard to the
events taking place during the period of 20 days that our
delegation was there, but what about the months prior to
that?
What about the intimidation, the disregard for the
principles of a constitutional state? Democracy, safety and
stability were thrown overboard when peaceful protesters
bore the brunt of violent behaviour on the part of the
government. What about the total disregard for an order of
the supreme court and the violation of the right to freedom
of expression of its citizens and the one-sided support
given by the Zimbabwean police force to law-breakers?
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Let me use a metaphor. The election race ends neck and
neck. Zanu-PF and the MDC almost cross the finish line at
the same time and everyone says what a wonderful race it
was. Our delegation arrives there after four of the five
laps have already been run. They look and say that the men
are running well, this is going to be quite something.
In the meantime they forget that the start was completely
uneven, that the MDC was held back by unlawful interference
and obstruction, and that Zanu-PF took short cuts in the
first few laps in every possible unlawful way and
shouldered their opponents from the track using
impermissible methods. We have to guard against the even
result making us blind to the irregularities.
Furthermore, I have to say that the behaviour does not
stand the test of fairness. Certain parts of the content of
the report highlight this, and the whole undemocratic runup over the past month also indicates this. My thanks go to
the delegation for the good work they have done, but the
AEB cannot associate itself with the findings of this
report.]
The election did not reflect the will of the Zimbabwean
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people, and I think we must act accordingly.
Mr M A MANGENA: Madam Speaker, by all accounts the mission
sent by this Parliament to observe the Zimbabwean national
elections behaved professionally. It respected the
Zimbabwean people and their electoral process. It was
efficient and competent in the execution of its mandate.
Murmurs of bias on the part of the mission towards Zanu-PF
proved to have no basis. We congratulate the members of
that mission for a job well done.
The more profound congratulations go to the people of
Zimbabwe for successfully concluding their elections under
very trying conditions. Those elections aroused intense
passions worldwide. They took place under circumstances
where the traditional and entrenched economic interests of
some powerful people and their allies seemed under threat.
It seemed Zimbabweans were no longer behaving like wellschooled and conditioned subjects of colonialism and
neocolonialism. They have embarked on a path that
challenged conventional rules of property ownership and
generally expected reverence of the powerful countries of
the North by all of us in the South.
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The ruling party in that country was under attack from the
international community and its media, and there was no
doubt that a different electoral outcome than what we have
at the moment was desired by many. It was therefore very
good and even crucial that neighbours of Zimbabwe such as
ourselves and other SADC countries, regardless of our views
on their programmes, sent observers there to cushion them
against pressures of the powerful Western countries. The
more balanced atmosphere, to which we contributed by our
presence, allowed them to exercise their rights and their
sovereignty with less tension and pressure.
As African countries and societies, we should work hard to
remove conditions that prompt others to come and monitor
and observe our elections. Every time one or other African
country holds elections, it is as if they are children
writing examinations, therefore requiring invigilators. Of
course we are, at the end of it all, given some ratings
which determine whether we get aid or good treatment from
the richer countries of the world. This demeaning situation
can only be changed by us and we should do it. [Applause.]
Mr A C NEL: Madam Speaker, I, like many members of the
South African parliamentary observer mission, would like to
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express my gratitude to the House for having been given the
opportunity to participate in observing the recent
parliamentary elections in Zimbabwe, and to make a
contribution in the process of consolidating and
strengthening democracy on our continent. The sense of
gratitude is all the greater because, as the observer
mission's report states, we were very conscious of the
importance of our mission, because Zimbabwe is South
Africa's neighbour and our nations share deep historical,
political and cultural ties.
During the course of our mission the depth of these ties
was clear at all times. It is clear that our nations are
inextricably linked and our destinies intertwined. For this
reason, whilst our mission was to observe, we could never
do so merely as passive, unattached and disinterested
outsiders looking on, safe in the knowledge that once our
bags were packed, we would not be affected by what we had
been observing. We were conscious that South Africa and
Zimbabwe shared a history of struggle against colonialism
and racial oppression, that the graves of the fallen heroes
of the Wanghe campaign lie in Zimbabwe, that many
Zimbabweans still bear the scars of the destabilisation
campaign that was waged because of the Zimbabwean people's
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support for our liberation struggle.
We were conscious that Zimbabwe is South Africa's biggest
trading partner on the African continent and the eighth
biggest trading partner in the world. In 1998 South Africa
imported R1 billion from Zimbabwe, much of it raw materials
and agricultural produce, and exported R5 billion to
Zimbabwe, mostly manufactured products. Over and above
these formal trade links, there is vibrant and growing
undeclared, mainly informal, trade between South Africa and
Zimbabwe. Whilst it is difficult to quantify this trade,
the fact that in 1996, 194 000 visas were issued by the
South African Consulate in Harare serves as some indication
of its extent.
We were very conscious of the fact that, notwithstanding
the differences of approach and emphasis on certain issues,
South Africa and Zimbabwe share the vision of a better
Southern African region and a better continent, and we are
co-operating in multilateral institutions such as SADC, the
OAU and the UN to realise this shared vision. For these
reasons we were aware of the damage and setbacks that South
Africa would suffer should Zimbabwe fail and, accordingly,
of the need to carry out our mission in the most
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disciplined and responsible manner.
Therefore, the remarks made by the hon Mr Van Schalkwyk are
saddening. He made three very contestable statements:
Firstly, that the South African Government was turning a
blind eye to human rights violations. I think that is a
repugnant statement, coming from the leader of a party that
conducted a destabilisation campaign from which the
Southern African region is only now starting to recover.
Since 1994 the South African Government has embarked on
probably the strongest campaign to bring peace, stability
and democracy not only in Southern Africa, but on the
continent as a whole.
Secondly, he alleged that the approach of silent diplomacy
was wrong. There are many Zimbabweans who would differ with
Mr Van Schalkwyk, including members of the Commercial
Farmers' Union who, when meeting with the delegation,
thanked us and requested us to convey their sense of
gratitude for the approach that our President had been
following.
The third issue that Mr Van Schalkwyk raised was the visit
to President Mugabe. We were surprised that he raised this
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issue because this matter had been discussed in our
delegation and all members of the delegation had accepted
the explanation given for that visit. The fact of the
matter is that the work of the parliamentary observer
mission had officially been concluded by the time that
visit took place. Therefore, that visit had nothing to do
with the mission. It is not contained in our report, and we
do not know why Mr Van Schalkwyk raised the issue.
Lastly, the mission provided many of us with the
opportunity to observe a nation that, in 20 years of
independence, has succeeded in making huge improvements in
the lives of its people. Zimbabwe has established an
education system in which primary school attendance rose
from 820 000 to 2 264 000 and secondary school attendance
rose from 60 000 to 600 000 from 1979 to 1987. We observed
that even in the remotest rural areas, there was access to
schools and veterinary clinics, all within walking
distance.
It is clear that our nations have much to learn from each
other and much to gain from co-operating. We hope that the
parliamentary elections in Zimbabwe have further
strengthened and consolidated democracy on our continent,
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and that South Africa and Zimbabwe will continue cooperating to improve the lives of our people and the people
of Africa. On behalf of the ANC, I move that the House
adopt the report of the South African parliamentary
observer mission. [Applause.]
The DEPUTY SPEAKER: Order! Before coming to the adoption of
the report, I would like to express the appreciation of the
Speaker and myself, not only to this Parliament for having
sent this observer mission, but also to the delegation that
went to Zimbabwe and the manner in which they discharged
the mission that they had been given by this Parliament.
Hopefully, they have set a precedent that is quite worthy
of building on and in fact improving on in future. Thank
you very much. [Applause.]
Debate concluded.
Report adopted (Freedom Front and Afrikaner
Eenheidsbeweging dissenting).
ADJUSTMENTS APPROPRIATION BILL
(Introduction)
14 SEPTEMBER 2000
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The MINISTER OF FINANCE: Madam Speaker and hon members,
after tabling the adjustments estimate of last year,
circumstances necessitated that certain amounts be provided
that were not included in the adjustments estimate. These
amounts have been authorised in terms of section 71 of the
Exchequer Act of 1975. Subsection 2 also determines that
steps be taken not later than during the next ensuing
session of Parliament for the appropriation of any amounts
which had been utilised in terms of subsection 1. Madam
Speaker, I move.
Bill together with introductory speech and papers tabled,
referred to the Portfolio Committee on Finance for
consideration and report.
COUNCIL FOR MEDICAL SCHEMES LEVIES BILL
(Introduction)
The MINISTER OF FINANCE: Madam Speaker, the Medical Schemes
Act of 1998 establishes a Council for Medical Schemes to
perform all the regulatory oversight functions required for
the implementation of the Act. The Council for Medical
Schemes Levies Bill, in turn, establishes a levy financing
14 SEPTEMBER 2000
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framework for the Council for Medical Schemes. This is a
very long speech which I have just made, therefore, I move.
Bill, together with introductory speech, referred to the
Portfolio Committee on Health for consideration and report
in accordance with earlier resolution.
FINANCE BILL
(Second Reading debate)
The MINISTER OF FINANCE: Madam Speaker, the Finance Bill is
essentially the requirement in law to confirm here a series
of decisions that have been taken by the Standing Committee
on Public Accounts so that expenditures that were deemed to
have been unauthorised can now be regularised and properly
accounted for. I move the Finance Bill of 2000.
Mrs R R JOEMAT: Madam Speaker, the objective of the Finance
Bill reads as follows:
To charge the National Revenue Fund with certain
unauthorised expenditure and to authorise other
expenditure; to regulate the closure of certain obsolete
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revenue accounts; and to provide for matters connected
therewith.
The expenses outlined in this Bill stretch over the
financial periods of 1991 to 1997 as indicated in clauses
1, 2, and 3 of the Bill, and amount to a total of
approximately R4,3 billion. Clause 1 amounts to
approximately R133,8 million or 3,12% of the total amount.
The unauthorised expenditure has to be paid over to the
National Revenue Fund. These funds will have to be refunded
to the relevant departments as a direct charge against the
National Revenue Fund. Clause 2 amounts to approximately
R15,1 million or 0,4% of the total amount. This
unauthorised expenditure has not been paid over and need
therefore not be refunded. With regard to clause 3, the
bulk of expenses as outlined in Schedule 3 to this Bill
relate to the expenditure of the former TBVC states and the
self-governing territories, and this covers 96,5% of the
total amount, which is approximately R4,1 billion.
Frequently, we hear in this House that we must stop blaming
apartheid, but the bulk of these expenses are from the
former TBVC states and self-governing territories which
were the creation of the previous apartheid government,
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whose members have now renamed themselves the Democratic
Alliance. So, the words of the song After changes we're
more or less the same by Bob Dylan should fit the DA.
[Interjections.]
Mrs M P COETZEE-KASPER: Madam Speaker, on a point of order:
I observe that the television sets are off. What if a fire
breaks out all of a sudden?
The DEPUTY SPEAKER: Order! The screens are clear. It seems
that is something that concerns the technical team. Can the
technical staff just find out what is going on, or whether
the sound system is affecting the screens, because if the
sound system is on and we are recording, we can go ahead
without the TV screens. [Interjections.]
Mrs R R JOEMAT: I am still speaking about the unauthorised
expenses of the former TBVC states and the self-governing
territories. The provincial public accounts committees in
the provinces were tasked with investigating the
circumstances in which the expenditure had occurred. They
have made recommendations regarding the possible
authorisation of these expenses. The Standing Committee on
Public Accounts, in order to enable the provinces to clear
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the relevant book entries, therefore recommended that the
unauthorised expenditure, as listed, be submitted for
authorisation by Parliament.
The committee further recommended, as stipulated in the
Bill, that any legal entitlement regarding the potential
recovery of any losses to the state, owing to the
unauthorised expenditure in question, must remain. We must
emphasise that unauthorised expenses cannot be justified.
We must ensure that unauthorised expenses are brought down
to a nonexistent level in Government. The new Public
Finance Management Act will be a deterrent to any
accounting officer who is negligent or ignores proper
procedures. In terms of the said Act the accounting officer
must exercise all reasonable care by implementing
effective, efficient and transparent processes of financial
and risk management to prevent and detect unauthorised,
irregular, fruitless and wasteful expenses.
The accounting officer will have to have the power to act
against any person responsible for unauthorised or wasteful
expenses. The Pubic Finance Management Act echoes the
Public Service regulations by assigning greater
responsibility and allowing greater powers to accounting
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officers, and provides the means by which any accounting
officer will be held accountable. The effective management
of finance in the public sector is pivotal to good
governance in order to improve the quality and efficiency
of service delivery. When the Public Finance Management Act
was signed into law it indicated that the ANC-led
Government had taken a significant step towards modernising
financial management in the public sector. Therefore, the
ANC supports this Bill before us. [Applause.]
Ms R TALJAARD: Madam Speaker, hon members, the Finance Bill
before us today deals with the past in a number of ways, as
the schedules show. Not only does the Bill seek to
authorise certain categories of unauthorised expenditure
and finally unwind a legacy of geographic Balkanisation,
but it also serves as a poignant reminder of the vagaries
of an inadequate system of financial management which we
must symbolically bury today with the passage of this Bill.
The Bill before us seeks to wrap up the writing off of R4,1
billion in unauthorised expenditure, which was recommended
to be dealt with in this manner by resolutions of
Parliament's Standing Committee on Public Accounts. While
the DP supports this Bill, it is with an element of concern
14 SEPTEMBER 2000
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at the impression which could be created by Parliament
passing a law authorising that unauthorised expenditure be
defrayed from the National Revenue Fund. We sincerely hope
that this potential message will be drowned out loudly and
clearly by the rigorous implementation of the Public
Finance Management Act to ensure that our civil service
becomes a lean and mean, value-for-money-based machine over
which the Auditor-General can preside with far more
stringent tools at his disposal, instead of having to issue
qualifying statements with many of the departments'
accounts.
South Africa's democratically elected Parliament has chosen
to address the effects of inadequate public finance
management through the passage of the Public Finance
Management Act which came into force in April this year. In
the aftermath of yesterday's Standing Committee on Public
Accounts hearing on the Public Finance Management Act, it
is no understatement to say that we are eagerly awaiting
Cabinet's final green light, and targeted guidance by the
Department of Finance and other role-players, for the
Public Finance Management implementation plan to make its
presence and its effects felt throughout the South African
civil service so that we avoid instances such as the
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unauthorised expenditure we have in the Bill before us
today.
While the Finance Bill seeks to authorise this expenditure,
it does not do so in a blanket fashion to the exclusion of
efforts to recoup the spent funds. Clause 5 of the Bill
makes specific provision for actions of recovery of the
money to continue, and states clearly that the Finance Bill
may not be construed as affecting any action to recover
unauthorised expenditure. Thus the Bill makes express
provision to ensure that any legal entitlement regarding
the potential recovery of any losses to the state, owing to
the unauthorised expenditure in question, must remain. As
this residual right is expressly maintained in clause 5,
the Finance Bill should be favourably considered.
We must move away from the emphasis which South Africa's
public finance legislation placed on authorised and
unauthorised expenditure in the previous Exchequer Act to a
responsible and responsive public finance management
approach under the provisions of our new legislation. This
would be consistent with the axiom that managers should
manage and that directors-general as accounting officers,
should have the responsibility and ability to make
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assessments on whether or not the South African taxpayers,
who are the end users of Government services in a context
in which poverty alleviation is a poignant imperative, are
indeed getting the maximum amount of bang for their
taxpaying buck. If they fail to make this assessment they
will clearly be accountable. It is in this context of
unauthorised expenditure that the Public Finance Management
Act should have drawn far clearer lines of political
accountability for Ministers, vis-à-vis their directorsgeneral. This will be one of the challenges that remain.
Clearly, a more focused approach to poverty alleviation
dictates that we need to move to a system in which we
sufficiently cost inputs and outputs and guard against
squandering and irresponsible expenditure, with not only
the rigour of the accountant, but also with the socially
aware conscience of a true public representative that
expects topnotch performance from the bureaucracy. At the
same time, however, such a move dictates that we must draw
far clearer lines of accountability for Ministers in the
Public Finance Management Act and in the financial chain of
accountability. It is hoped that this will indeed be the
case as the Director-General of Finance has already assured
Standing Committee on Public Accounts that Ministers have
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been amongst the most ardent attenders of workshops on the
Public Finance Management Act.
It is worth reminding Parliament that the latest annual
report by the Auditor-General yet again raises concerns
about the weaknesses in state accounts. These weaknesses
will not be taken away by the passage of a law such as the
Public Finance Management Act, and many challenges remain
if we are not to repeat many of the mistakes of the past
which we seek to address in today's Finance Bill. We need
to be honest and upfront about the challenges that lie
ahead if we are to realise the inherent value in the new
Public Finance Management Act.
The clear and present challenge is the head-hunting of
sufficient skills, both by Government departments and the
Office of the Auditor-General, to ensure that we have the
skills pool to effectively implement the Act. At the same
time, the training of public finance managers at all three
levels of Government will be a mammoth task and a
sufficient and reliable source of trainers will have to be
found to undertake this task. It is to be welcomed that
Institute for Public Finance and Auditing, IPFA, and the
Public Service Commission are already working on a project
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to ensure the necessary accreditation.
When the country's Auditor-General warns us and slates the
Public Service as a stagnant and bureaucratic employer,
incapable of attracting enough top-skilled staff even if it
could offer competitive salaries, we need to take serious
stock of the problems in a rigorous and uncompromising
manner. The ethos change in the civil service, which the
Auditor-General has referred to, is a non-negotiable
prerequisite to seeing a real turnaround in the state of
Government finances and a reduction in the number of
departments that receive qualified audit reports from the
Auditor-General's office.
Only a carrot and stick approach will move us away from the
irresponsible approach to public finance management which
speaks so clearly in Schedule 1 to the Bill before us
today. While we have seen a dramatic drop in the level of
unauthorised expenditure, down from R763 million to R156
million, the battle for sound financial management is far
from won. We have the Public Finance Management Act as the
carrot, which could act as a catalyst for the ethos change
that we require in the civil service, but this will not be
sufficient. We also need the stick, the stick that will be
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a deterrent to civil servants maximising their own selfinterest and using the public purse to that end, as opposed
to maximising the interests of the poor.
In his foreword to the Public Finance Management Act, the
Minister cites its ambitious aims to modernise public
sector financial management, and I quote:
The key objectives of the Act may be summarised as being
to modernise the system of financial management, enable
public sector managers to manage, but at the same time be
more accountable, ensure the timely provision of quality
information, and eliminate waste and corruption in the
use of public assets.
Few would argue that the Finance Bill before us today
contains at least elements of waste and corruption. Be it
pre-1994 or post-1994, the principle of unacceptability
stands unquestioned. It is with this acknowledgement in
mind that the President has also, on numerous occasions,
warned civil servants who maximise their own self-interest.
The missing and admittedly short-term ingredient in South
Africa is a strong and clear anti-corruption Act which
could dovetail quite strongly with the new Public Finance
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Management Act and ensure that we eliminate not only
wasteful expenditure, but also a corrupt siphoning off of
revenue intended for service delivery and the poor. With
these provisos and future indicators of the ethos change
that we need and the challenges remaining for the Public
Finance Management Act, the DP supports the Finance Bill.
[Applause.]
Dr G G WOODS: Madam Speaker, further to what has already
been said, in particular about the coming of the new Public
Finance Management Act, the PFMA, we note that we will be
changing the whole way we see unauthorised expenditure in
future, and we, indeed, will be changing the whole way in
which it is processed.
Up to now we have had to rely on this very heavy compliance
approach and it has been very necessary. This, of course,
means compliance with vast rules which govern the spending
practices of Government. In fact, this is an expenditure
control system that has been the only tool Government has
had thus far, as it has sought to protect public funds from
poor or dishonest use. As the new Act shifts us from an
intense control environment to more of a performance
environment, the rules will greatly reduce. I think the
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most obvious effect will be to significantly reduce the
instances of unauthorised expenditure which otherwise arise
because of technical reasons and where the state has in
fact suffered no loss, these being those which are
currently classified as unauthorised because, for example,
they do not comply with some nonessential tender board
regulation.
If we look at the Bill before us, particularly Schedule 1,
there is actually a very small amount of actual loss to the
state, most of it being there for technical reasons. If we
further
consider the total amount which constitutes
unauthorised expenditure in the current year or immediate
past years, then this is usually less than 0,5% of the full
Government spending. Therefore there is no need for panic,
even though there is still need for some concern. But all
this does mean that in future we can expect a far thinner
finance Bill when the new Act comes into being.
I think, contemplating the detail of the lists in the Bill
before us, one will of course notice the odd incident which
does demand our special attention, where an official's
actions are simply inexcusable. These actions need to be
fully considered and responded to in order to send out the
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right message and to discourage repetition. Hopefully the
Joint Standing Committee on Public Accounts, when
investigating and processing these instances, and making
its recommendations to Parliament, will achieve just that.
I would like to say a word or two about Schedule 3. Other
speakers have also referred to this, the approximately R4
billion of the TBVC countries. Of course, this arrear is
from a particularly difficult time in our history, and I
think one is always going to be left with something of a
question regarding the ease with which this R4 billion has
been discounted and written off. We have 303 instances out
of 305 which have been included in this list, and one
always asks the question whether there was perhaps more
that we could have done. However, at the time we had to be
satisfied with the efforts from the provincial level that
the records were simply in a state of disarray and I think
they went a long way towards convincing us that there was
very little chance of fully investigating those amounts and
recovering them. However, as I say, it is an opportunity to
close the door on another part of that history which we
would like to put behind us, and for that reason we will
certainly support this Bill.
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Dr G W KOORNHOF: Madam Speaker ...
Mr J H MOMBERG: Madam Speaker, on a point of order: May I
just find out - because of the fact that Mr Lee is sitting
with the New NP - whether a special ruling has been made
for crossing the floor between the two opposition parties?
The DEPUTY SPEAKER: Order! That is not a point of order.
[Interjections.] Please proceed, hon member.
Dr G W KOORNHOF: Madam Speaker, the amount of R4,1 billion
referred to in Schedule 3 of the Bill represents the last
direct monetary remains of the apartheid regime in respect
of the former homelands and probably reflects only a
fraction of the financial cost of a political ideology that
caused so much human suffering and pain. It closes the book
on money spent on the former homelands and reminds us never
to repeat the same mistakes. The R4,1 billion being
authorised in this regard equals the R4 billion of unspent
money and funds reported by the Auditor-General during the
1998-99 financial year, representing nearly 5% of that
year's total budget. In the same way that we are critical
of money wasted on a political ideology, we are also
critical of wasted opportunities when budgeted funds are
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not spent.
We trust that the new Public Finance Management Act will
have the effect to reduce the amount of money over or
underspent. This puts a huge responsibility on the national
Treasury, the Auditor-General, Government departments and
this House. The UDM supports the Bill.
Mr L M GREEN: Deputy Speaker, hon members, the clearing of
the accounts of the former TBVC states and self-governing
territories has been an outstanding matter for a very long
time. The legislation before the House today finally deals
with this outstanding matter and, when passed today, will
authorise the expenditure of R4,14 billion by the former
TBVC states.
Our acceptance of this Bill today will enable the new
provincial structures to clear the relevant book entries.
This Bill also gives effect to resolutions by the Joint
Standing Committee on Public Accounts that R133,8 million
of unauthorised Government expenditure, dating back to the
early 1990s, be authorised by Parliament. The Bill will
further authorise R15,2 million in unauthorised expenditure
that had not been transferred to the Central Revenue Fund.
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For these reasons, the ACDP therefore supports the passing
of this Bill.
Mr B NAIR: Madam Speaker, hon Minister, hon Deputy Minister
and members, the Joint Standing Committee on Public
Accounts had, over the years, grappled with the problems of
unauthorised expenditure, non-adherence by departments to
Treasury instructions, and the tender board rules, of
proper financial management and internal controls, amongst
other things. Some accounting officers have consistently
failed to carry out these strictures, or recommendations
that we had made. The latest Auditor-General's report on
national Government deals extensively with the problems of
financial management. The issue that confronts us is how to
contain financial mismanagement.
Now, thankfully - and this has already been mentioned by
the previous speakers - we have the Public Finance
Management Act which came into operation in April, and is
in the process of being implemented. High-powered and wellmotivated human resources and equally well-equipped
technology are required for the successful engineering of
the Public Finance Management Act. The Treasury, like Sars,
must of necessity be well equipped, well motivated,
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efficient and business-oriented. The cost involved will be
high and it will not be surprising if the Treasury demands
greater resources for its enterprise.
Only yesterday the public accounts and finance portfolio
committees were briefed by the Treasury on plans to
implement the Public Finance Management Act. Emphasis is
being placed on training of staff, recruitment of expertise
and upgrading of technology so that effective financial
management of revenue and expenditure, and of assets and
liabilities, can be attained. This will mean proper
internal audits and controls, monitoring and reporting,
performance budgeting and accountability. Capacity-building
will be intervowen and constitute an ongoing programme. In
time, accounting will change from cash to an accrual system
to ensure effective accountability.
In the past few years, many changes have been made in the
management of public finance. The reorganisation of the
South African Revenue Services and the resultant efficient
revenue collection, have brought more money into the
coffers of the state. Now, the reorganisation of the
Departments of Finance and of State Expenditure into a
single entity will ensure effective oversight over
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departments. Correspondingly, there will be greater
delegation of powers to departments, which will, in turn,
have to ensure proper delivery and accountability to the
Treasury.
Given the will of the heads of Government to implement the
Public Finance Management Act, and backed up by sufficient
resources, in a few years we may witness the more efficient
financial management of Government. [Applause.]
The DEPUTY MINISTER OF FINANCE: Chairperson, I would like
to thank all of the members who have participated in the
debate for their support for this Bill. I think a word that
one would like to convey is that essentially the spirit of
the Public Finance Management Act is properly captured in
the issues that have been raised here by members. These are
the very problems that we are trying to deal with so that
in future South Africa does not experience the sort of
things that we find ourselves having to address in the
Finance Bill. [Applause.]
Debate concluded.
Bill read a second time.
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BANKS AMENDMENT BILL
(Second Reading debate)
The DEPUTY MINISTER OF FINANCE: Chairperson, the Bill that
we are debating today essentially seeks to simplify and
improve certain provisions of the Banks Act, which, in the
process of administering the principal Act and through
consultations with foreign supervisory authorities and
international standard-setting bodies such as the Basle
Committee on Banking Supervision, were found to be
advisable.
It improves the principal Act - makes it accord more with
international banking standards and best practice as set
out in the Basle Core Principles for Effective Banking
Supervision. These core principles are intended to serve as
a basic reference for supervisory and other authorities in
all countries and internationally. Accordingly, the
amendments contained in the Bill are proposed in order to
ensure that the South African legal framework, in terms of
which banking institutions and banking groups are regulated
and supervised, remains relevant and current, and in line
with the latest national and international developments and
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standards.
After a lengthy process of consideration, the Standing
Committee for the Revision of the Banks Act appointed by
the Minister of Finance has approved the envisaged
amendments described in the Bill. The committee consists
of, among others, representatives of the banks, the Banking
Council, credit unions, stokvels and the Postbank.
In summary, the amendments that we are effecting through
this Bill are to insert certain new definitions; to provide
for the designation by the Reserve Bank of more than one
Deputy Registrar of Banks - this is really because of
growing responsibilities; to provide for the confidential
treatment of the due diligence report drawn up in
consequence of conducting a due diligence audit on the
financial condition of a bank; to substitute a process of
review for the existing process of appeal against decisions
of the Registrar of Banks; to empower the Registrar to
authorise a banking institution to use or refer to itself
by a name other than the one under which it is registered;
further to consolidate principles of good corporate
governance with regard to the membership of the audit
committee of a bank; to abolish the judicial management of
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a bank that is in financial difficulties and instead
thereof to render the process of curatorship of such a bank
more comprehensive; to increase the minimum capital and
unimpaired reserve funds required to be maintained by a
bank from R50 million to R250 million; and to provide for
addition capital and reserve funds to be maintained by
banks in respect of their trading in financial instruments.
We also provide for the maintenance of an aggregate minimum
capital and reserve funds in respect of a banking group;
allow banks greater flexibility in the utilisation of their
liquid assets; introduce further safeguards in respect of
large exposures constituting credit risks to banking
institutions; and, finally, we seek to create and prescribe
penalties for certain further offences.
With these few words, I would like to open this debate on
the Banks Amendment Bill.
Prof B TUROK: Deputy Chairperson, much as we welcome your
accession to the throne, I was hoping that the Deputy
Speaker would be here because I have a point to make which
she would have appreciated very much. In the course of our
discussion of this Bill in the Portfolio Committee on
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Finance, we came across a formulation that something must
happen ``at his own expense''. The committee said no, we
must put ``his or her'', and the law adviser said no,
because the principal Act talks about ``his'' therefore the
amending legislation cannot talk about ``his or her''. And
it seems to me that this is a matter that the House should
be aware of, that we are stuck in a groove of old
legislation which is male dominant and cast in the language
of the past. I think some of the hon members here must take
it up in the right place.
This Bill is a rather important one because of the context.
The object is to create greater certainty in institutions
which are based on risk. We often talk about banks as
ordinary businesses, forgetting that a bank is
fundamentally a risk institution. They risk capital because
they gear money that one puts into the bank and use that to
invest in various places and this is done in an atmosphere
of risk.
Last week I attended a conference in New York of some 2 000
delegates who were concerned about the state of the world
and a great deal of discussion took place about the
financial institutions and the financial regulation of
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those institutions worldwide. The conference was held in
parallel to the United Nations Millennium Conference and it
was attended by many heads of state and various leaders of
the UN who participated in both meetings. What came out
very strongly was a recognition that current economic
uncertainty internationally is based on a crisis in the
banking system.
This Bill of ours is meant to ensure that our own banking
system is not only prudent and well regulated, but that it
behaves in accordance with those requirements that are now
recognised internationally. This is particularly important
because of the recent crisis in East Asia, where there was
a contagion effect in the whole economy because the banks
had been lending too much.
Our committee was also cognisant of the fact that in the
United States one of the largest banks, the LTCM, almost
went bust because the gearing was too high. That bank had a
certain quantity of money. They lent far more, on a very
high gearing ratio, and therefore created a danger not only
to that bank, but to the whole of the financial system in
the United States and internationally.
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One of the issues reflected in this Bill is the complexity
of banking worldwide. We have local banks, we have foreign
banks, we have conglomerates and we have branches. The
definitions draw attention to three different kinds of
banking institutions. Firstly, there is a banking group
which is a part of a financial structure which is not
involved in banking. But they are linked and therefore the
prudential activities of the banking branch can have a
serious effect on the other parts. Furthermore, this can
affect the financial system irrespective of the domicile of
that branch.
We therefore have conglomerates, which are worldwide, in
which in one part there is risk and in another part there
is not so much risk, but the one can infect the other. Then
we have a branch of a bank, which is a foreign institution,
which is not a public company, but nevertheless does
banking in South Africa. Thirdly, we have a South African
bank which conducts banking outside South Africa. So we
have a huge complexity of relationships between financial
institutions, hence the need for prudential consideration.
One of the safeguards that were brought in is that tertiary
capital is required in the case of those banks which trade
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in financial instruments, because now we have a system
worldwide which has instruments called derivatives, which
are very volatile and create enormous hazard in the
financial sectors all over the world. Therefore we want
additional prudential requirements for those institutions.
I should say that the committee was also a bit concerned
about a clause in the original draft which said that people
who are summoned by a board of review are compelled to
attend, and the committee felt that, in order to have a
safeguard, that person should have legal representation.
However the Department of Finance insisted that it should
be at the individual expense of the person summoned and
that the Department of Finance or the Government should not
have to foot the bill. It is in that clause that the word
``his'' was inserted and we could not get the word ``her''
in, because, in the cause of gender equity, some will want
``her'' to pay as well. I hope the female members of the
House will forgive that comment.
Finally, there is the question of the R250 million. Many
members of our committee felt that this was too high for a
new bank, ie that it would be prohibitive for a new black
bank, for example. We discussed this at length and the
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explanation that was given us was that ...
The DEPUTY CHAIRPERSON OF COMMITTEES: Order! Hon member,
your speaking time has expired.
Prof B TUROK: Midsentence! Thank you, Chair. [Applause].
Dr G G WOODS: Mr Chairperson, this Bill reinforces and
updates the key premises of the Banks Act and does so as a
necessary response to recent developments in the banking
industry. Among these developments are rapid changes in the
banking industry with the formation of new financial-type
collectives. Together with this has been the development of
new marketplaces and the growing use of particular
financial instruments. I think when such developments take
place in an industry in which huge consumer interests are
at stake, there is an obligation to revisit the relevant
law and to evaluate its existing appropriateness and
potential effectiveness.
However, firstly, just let us briefly remind ourselves of
the key objectives of the Banks Act against which these
amendments should be considered. Essentially the Act
provides a framework of supervision for the banking aspects
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of financial services and issues the prudential rules it
expects banks to follow. The prudential rules in
significant part relate to the capital and the liquidity
adequacy of banks, or to the capital ratio as we refer to
it. Clause 12 of the Bill, which relates to section 70 of
the Act, seeks to adjust this adequacy level, as mentioned
by the hon Ben Turok, from R50 million to R250 million. I
think this is where we expect to have some problems, or an
outcry from the industry, because it is the most
substantial amendment within the Bill. However, pleasingly,
the banking industry, via the Banking Council, saw fit to
support that, as they did the new definition of tertiary
capital.
The other noteworthy amendments are those concerning the
new treatment of separate entities which, in fact,
constitute a banking group, particulars of which are
adequately described in the Bill. I think the conducting of
more confidential, diligent audits, as mentioned by the
Deputy Minister, the changing of the appeal process to a
review process, and the Bill's additional protections in
respect of large credit exposure risks and foreign banking
connections all contribute to the Act's regulatory
objectives, which go towards ensuring a high level of
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efficiency in the provision of financial services, and do
so in a way which adds further stability to the entire
financial system. I think, in view of these positive
amendments, we support the Bill.
The DEPUTY CHAIRPERSON OF COMMITTEES: Order! Hon members,
before I call Mr Rabie, some members are causing me to
focus rather sharply on them. I will not identify who they
are, but I hope they do not become the subject of my total
attention.
Dr P J RABIE: Mr Chairman, hon Deputy Minister, hon
members, the Banks Amendment Bill contains a number of
internationally accepted amendments dealing with issues
that relate to the Basle
Committee on Banking Supervision,
and the New NP supports this Bill.
As some of the other speakers have already mentioned, the
Expressions ``bank'', ``branch of a bank'' and ``banking
group'' are defined. Clause 1(b) stipulates the process of
review to be followed if a decision has been taken by the
Registrar of Banks, and some of the relevant banks are not
satisfied with it. Clause 1(c) is also significant as it
refers to liquid assets. The consideration of the credit
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risk that long-term securities entail is stressed in this
context. Another feature of the Bill is the repositioning
of the definition of primary share capital, which means
capital obtained through the issue of ordinary shares,
nonredeemable and noncumulative preference shares, or
prescribed categories of preferred securities.
Clause 1(f), again, repositions the definition of secondary
capital, also obtained through the issue of cumulative
preference shares, ordinary shares, prescribed categories
of debt instruments, and it also defines unimpaired
reserves, which relate to funds obtained from actual
earnings, prescribed percentages, including percentages of
the amounts of any surplus resulting from a revaluation of
assets. ``Tertiary capital'' is defined as ``accrued
current-period uncapitalised net profits derived from
trading activities''.
Clause 2 provides for more than one Deputy Registrar of
Banks, allowing a maximum of four. It allows for more
specialising and it may result in a flatter report
structure. I think this is also a significant improvement
in this particular Bill. Clause 3 provides for the
conducting of a due diligence audit of the financial
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conditions of a bank in the interests of the bank under
audit, and it is also in the interests of the depositors
and possible future transferees.
At present the banking sector operates in a global economic
financial environment. It is of the utmost importance that
the South African banking sector be allowed to implement
clause 5 of the proposed Banks Amendment Bill to allow the
Registrar of Banks to authorise the use of a name other
than the one under which the banking institution is
registered, but by which the institution is generally known
and conducts its business.
Clause 8 consolidates the position in respect of the
members of a bank's audit committee. The chairperson of the
board of directors may not serve as a member of the bank's
audit committee and this is also in line with international
best practice. Clause 12 amends section 70 of the principal
Act which sets out the minimum capital reserves, as
referred to by Prof Turok. The reserve fund requirements
with which banks must comply increases from R50 million to
R250 million. Bearing in mind that other types of banks,
mutual or co-operative banks, can be started with as little
as R10 million, it is also considered to be in the
14 SEPTEMBER 2000
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interests of the general public. Clause 15 is significant,
because it further safeguards the interests of banks in
respect of large exposures constituting credit risks to
banks, and extends these safeguards to single controlling
companies, local branches of foreign banks and foreign
branches of local banks.
Die Suid-Afrikaanse banksektor en finansiële markte het
ondanks 'n hoë mate van turbulensie op die internasionale
markte die dekade van die neëntigerjare baie goed
deurstaan. In hierdie verband moet ons beslis verwys na die
banksektor wat 'n leidende rol gespeel het om die SuidAfrikaanse finansiële sektor 'n integrale deel van die
internasionale markte te maak, en ek dink die hele
ekonomiese groei kan slegs geskied indien ons hierdie
kosbare kleinood van ons bewaar en verder uitbou.
'n Beroep word op alle rolspelers gedoen, insluitende die
Regering, om die banksektor uit te bou. Banke werk met
openbare geld en daar is risiko daaraan verbonde. Die leen
van geld is gegrond op 'n baie hoë morele
verantwoordelikheid. Banke het morele verpligtinge ten
opsigte van aandeelhouers rakende dividende, maar dit is
ook gebiedend noodsaaklik dat die banke hul aandeel in die
14 SEPTEMBER 2000
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bemagtiging van die agtergeblewe sektor uitbou sodat
hierdie persone en rykdom- en welvaartverspreiding 'n breër
aansluitingsbasis kan vind. (Translation of Afrikaans
paragraphs follows.)
[In spite of a high degree of turbulence on international
markets, the South African banking sector and financial
markets have weathered the decade of the nineties very
well. In this regard we definitely have to refer to the
banking sector which played a leading role to make the
South African financial sector an integral part of
international markets, and I think that overall economic
growth can only occur if we preserve and further develop
this valuable asset.
We appeal to all key players, including the Government, to
develop the banking sector. Banks work with public money
and there are risks involved. The lending of money is based
on a very high moral responsibility. Banks have moral
obligations towards shareholders as regards dividends, but
it is also imperative that banks develop their share in the
empowering of the disadvantaged sector, so that these
people and the distribution of wealth and prosperity may
find a more general point of connection.]
14 SEPTEMBER 2000
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I studied an article which was published in Business Day on
8 September 2000, page 2, where South Africa's
microeconomic environment is analysed by a well-known
professor attached to the Harvard Business School, by the
name of Michael Potter. He says that South Africa has an
outstanding asset in the macroeconomic front and he refers
to the banking sector. He also says that our particular
banking sector is extremely sophisticated, and that it
allows us to compete internationally. In fact, he refers to
our competitive edge. He ranks South Africa 13th in this
regard.
However, we should not be complacent because some of the
other sectors are anything but sophisticated. For example,
our police protection is ranked third from the bottom. Only
three other countries - Mexico, Venezuela and Ecuador - are
regarded as higher risk than ours. I think this is a
serious constraint, and we should really give our undivided
attention to that. The positive news, however, is that
South Africa is ranked 25th out of 58 countries in the
macroeconomic area, but only 33rd in areas such as economic
growth.
The banking sector is an integral and indispensable
14 SEPTEMBER 2000
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component for future South African growth. Potter says that
South Africa and Turkey exhibit an unusual combination of
``sophistication in a developing economy. We will have to
continue to cope with the unusual political changes which
may inhibit or improve our competitive economic
competitiveness.
Ons kan baie praat oor die banksektor. Laat ons hom nie die
swartskaap maak nie. Laat ons hom as een van die
kroonjuwele van ons ekonomiese sektor beskou en hom verder
uitbou. [Applous.] [We can say a lot about the banking
sector. Let us not make it the black sheep. Let us view it
as one of the crown jewels of our economic sector and
develop it further. [Applause.]]
Dr G W KOORNHOF: Mr Chairperson, we welcome the longoverdue amendments to this Bill. Both the introduction of a
new definition of a banking group and the high amount of
the minimum capital requirement now bring South Africa in
line with the generally accepted international banking
norms generally referred to as the Basle principles. This
makes it possible for the Office for Banks to conduct
supervision of financial conglomerates of which one or more
banks are members.
14 SEPTEMBER 2000
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I notice that the Deputy Minister of Finance is in the
House. Therefore, allow me to make an observation about the
role of our formal banks and economic transformation. It is
clear that there is a lack of progress and, seemingly, no
sense of urgency in this regard. We therefore appeal to the
Minister of Finance to alter the existing Government levy
on all banking transactions to a low ad valorem rate of
0,05%. We estimate that this should generate an additional
revenue of at least R10 billion per annum, which could be
used effectively to enhance black economic empowerment, and
thereby accelerate economic transformation in our country.
The UDM supports the Banks Amendment Bill. [Applause.]
Mr L M GREEN: Mr Chairperson, hon Ministers and hon
members, the Banks Amendment Bill raises the aggregate
minimum amount of capital and the reserve funds to be
maintained from the R50 million which was laid down six
years ago - that is a long time in monetary terms - to R250
million. We believe that this increase will not be harmful
to small banks. I think that that was the argument during
the debate in the portfolio committee. This increase has
been necessitated by the growth in inflation, the expansion
of the banks' activities and the need to enable local banks
to remain competitive in a globalised market.
14 SEPTEMBER 2000
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The Bill also provides for additional capital to be kept by
banks that participate in financial instruments trade. It
introduces a new provision that requires the separate
entities that constitute a banking group also to maintain
an aggregate of minimum capital and reserve funds. Another
amendment will allow banks the flexibility to use their
liquid assets for purposes of intraday accommodation at the
Reserve Bank discount window. We also welcome the fact that
a process of peer review will replace the current process
of appealing against the decisions of the Registrar of
Banks.
These amendments are necessary, and they are needed.
Therefore, the ACDP has no difficulty in supporting the
Bill.
Mr M S BOOI: Mr Chairperson, after long deliberations by
the portfolio committee and looking into the principal Act
preceding this one, the ANC has agreed on this Bill and is
supporting it.
However, there were a few issues that were raised by the
Bank Adjudicator which were quite important. The first
point was the consideration of transparency - and how
14 SEPTEMBER 2000
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transparent appointments were going to be. To us, those
were quite relevant and important issues which we applied
our minds to. We said that we would have to continuously
encourage and make sure that the Minister ensures that
transparency does take place.
The second point was the issue of legal representation of
those who are going to be called by the Registrar during
tough times when they face liquidation. So, it would be
very important that they have some legal representation.
Without legal representation they might feel they are being
interrogated, because of the wording used in the Bill. We
thought that it would be quite sensible and reasonable for
us to encourage them and allow in the legislation for them
to have some legal representation.
I do not think that the issue of R250 million, as
reflected, has to be viewed as something impacting on small
industries or small, medium and micro enterprises, but it
should rather be viewed as something that will assist us to
assist the banking community to build some viability and
more confidence. It is very important, within the South
African and world context, as well as in the politics of
globalisation, that we ensure that we have entry that is
14 SEPTEMBER 2000
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quite sound and acceptable within the norms of business in
the banking community.
So the R250 million, from our point of view, is quite
acceptable and we think that it will not impair the small
banking community or the small, medium and micro
enterprises from having a chance of getting in. Comrade Ben
Turok has already indicated that, although the principal
Act was adopted only in 1995, it has had a huge impact on
the issue of gender sensitivity, which we have raised. We
also hope that there will be quite a lot of improvement in
how they look at that particular issue.
Relating to one of the last issues that was raised, clause
70A really defines what banks have to do as different
groupings, that is, what do they have to do when they are
aligned as a bank with different groups, how do they
address that type of relationship, and how do we see the
impact when the Registrar looks into this. Does the
Registrar have to ensure that they are included, or are the
people that are included in the banking community being
treated in isolation?
We have always been saying that these issues are quite
14 SEPTEMBER 2000
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important in the banking community, and that whenever there
is a bank that is involved with that particular community,
the issue of risk which goes with banking is one that we
always have to ensure we can counter. We should not just
ensure that the risk is taken away by just being
moralistic, or by just saying that the issues will not
impact on the economy of the country. Therefore, we are
saying that the banking community, in relation to that
banking group, will always have to ensure that it takes
responsibility in relation to the banking group, and that
it does do so. So, what I am saying is that we support the
Bill, and we go along with it. [Applause.]
The DEPUTY MINISTER OF FINANCE: Chairman, again, one would
like to thank all the members who have participated in the
debate. Clearly, we are not being controversial today
because I think all the parties are supporting the Bill
that we have placed before this House.
Regarding an issue that was raised by the hon Koornhof, I
am not quite sure that I fully understood the proposal that
he was tabling. However, I think the issue that he seeks to
address is an issue which is occupying our minds currently.
If one were to go even by the approach that has been taken
14 SEPTEMBER 2000
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by the Black Economic Empowerment Commission in the report
that they outlined to Parliament yesterday, I think that
there is an important message that is coming out of that,
that we do need a more comprehensive approach but also an
approach that seeks to bring in various players in trying
to deal with this particular problem.
I think that the issue of investment for growth is an
important one because it makes that point, which is: let us
come together and focus on the question of growth and come
to some agreement as to what to do. We will have an
opportunity once the final report has been tabled to have
more focused and more comprehensive discussions around the
question of black empowerment. But, clearly, it remains a
critical challenge that faces South Africa.
With those few words I would like to thank all those
members who have participated. [Applause.]
Debate concluded.
Bill read a second time.
The DEPUTY CHAIRPERSON OF COMMITTEES: The Bill will be
14 SEPTEMBER 2000
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referred to the NCOP for concurrence. Hon members, because
of your kind co-operation, I am once again delighted to be
able to conclude the business of this day early. The House
is adjourned.
The House adjourned at 17:03.
__________
ANNOUNCEMENTS, TABLINGS AND COMMITTEE REPORTS
ANNOUNCEMENTS:
National Assembly and National Council of Provinces:
1.
The Speaker and the Chairperson:
(1) The Minister of Sport and Recreation on 4 September
2000 submitted a draft of the South African Sports
Commission Amendment Bill, 2000, as well as the
memorandum explaining the objects of the proposed
legislation, to the Speaker and the Chairperson in
terms of Joint Rule 159. The draft has been
referred to the Portfolio Committee on Sport and
Recreation and the Select Committee on Education
14 SEPTEMBER 2000
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and Recreation, respectively, by the Speaker and
the Chairperson in accordance with Joint Rule
159(2).
TABLINGS:
National Assembly and National Council of Provinces:
Papers:
1.
The Minister of Finance:
(1) Second Adjustments Estimate of Expenditure to be
defrayed from the National Revenue Fund during the
Financial Year ending 31 March 2000 [RP 5-2000].
(2) Explanatory Memorandum to the Adjustments Estimate
for 1999-2000.
2.
The Minister of Transport:
Report and Financial Statements of the Road Accident
Fund for 1998-99, including the Report of the AuditorGeneral on the Financial Statements for 1998-99.
14 SEPTEMBER 2000
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COMMITTEE REPORTS:
National Assembly:
1.
Report of the Portfolio Committee on Trade and Industry
on SMME sector, dated 31 August 2000:
The Portfolio Committee on Trade and Industry, having
held public hearings on the promotion of the SMME
(small, medium and micro enterprise) sector and the
role of banks, reports as follows:
The Committee and the Select Committee on Economic
Affairs of the National Council of Provinces held the
public hearings on 14 and 21 June 2000. The immediate
background to the hearings was a workshop on SMME
promotion, organised by the NCOP, where it was
reiterated that access to finance was a critical issue
and new initiatives were called for in relation to
banks.
The objective of the hearings was to examine the extent
of the involvement of banks in SMME finance and
problems encountered in this regard, as well as
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proposals to increase access to finance by SMMEs. The
hearings attracted a good deal of public attention.
Many individuals wrote to the Committee with specific
complaints, and many significant stakeholders gave oral
evidence. The hearings were intended to contribute to a
positive way forward and to highlight the work still to
be done.
A.
Banking Council and Associated Banks (Absa, Nedcor,
Standard Bank)
The Council began by highlighting a number of steps
they had taken since the Committee's 1999 hearings
on bank charges and micro-finance. These included
the introduction of a new Code of Banking Conduct,
appointment of an Adjudicator independent of the
Council, the establishment of a community-based
financial institution, Sizanani, and the recent
discussions with Khula around the provision of
venture capital.
The Council pointed to a structural tension between
their involvement in economic transformation and
the maintenance of a "sound financial sector". It
14 SEPTEMBER 2000
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acknowledges that there is a need for economic
restructuring, including the drawing of
historically disadvantaged people into the formal
economy, income redistribution and addressing
problems created by low levels of capital
accumulation and entrepreneurial skills.
This needed to be balanced against the need to
maintain a sound financial sector in line with
international best practice. According to the
Council, the unfolding international environment is
creating new competitive pressures, thereby placing
certain constraints on the banking industry in
South Africa. These include pressures to eliminate
cross-subsidisation and to scale down less
profitable activities.
The Council presented a profile of the SMME sector
in relation to the cost and size of loans. It
argued that the unit costs of making loans to
micro-enterprises were too high for banks, which
could also not provide the support needed for
entrepreneurs with limited managerial skills. They
said banks could only become involved in financing
14 SEPTEMBER 2000
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very small businesses through specialised
institutions such as Sizanani. The banks are,
however, currently very much involved in servicing
the small and medium enterprise sector and could
expect to continue to be involved in this segment
of the market.
Absa, Nedcor and Standard Bank provided a profile
of their individual institutions, mission
statements, total loan book and some indication of
their involvement in the SME sector. It was
apparent that the three institutions were using
different criteria, and from the information
presented it was difficult, if not impossible, to
determine what percentage of the loan book was
going to black entrepreneurs. Indeed, some of the
banks themselves acknowledged that they had no real
basis for measuring which of their clients were
previously disadvantaged individuals.
The Council proposed the establishment of
community-based financial institutions to service
the micro and very small sectors, which it said the
banks could not finance. The Council also proposed
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the strengthening of the NGO and retail finance
intermediary sectors that are currently involved in
this function. The Council also proposed the
strengthening of the Sizanani project. No clear
answers were provided to repeated questions about
banks' engagement in "red-lining" practices.
B.
Business Association, Investment Group, Financial
Consultancy
1.
South Cape Investment Network
The presenter referred to the constraints
imposed upon smaller enterprises by banks. The
Network proposed that black-owned and controlled small businesses face more
challenges than those owned by their white
counterparts. A case study was presented of a
bank manager who refused to open a cheque
account for an empowerment group.
It was reported that black entrepreneurs
continue to face hostility from white bank
managers, who are unsympathetic to the
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experience and plight of black-owned small
enterprises. The Network, in collaboration with
other stakeholders in the Southern Cape, has
taken up the issue of racism in the financial
sector to the Human Rights Commission. Some of
the issues raised included staff and management
attitudes, red-lining and a general disregard
for the South African context.
2.
Western Cape Black Business and Professionals
Alliance
The Alliance comprises several institutions
operating throughout the country, and consists
of accountants, building contractors, lawyers
and the Black Management Forum. According to
them, a key challenge is the changing of an
existing mindset in the banking industry that
sees black business as representing a high
risk. Banks are doing very little to provide
start-up capital, guarantees and bridging
finance for small black business.
The Alliance focused its submission on the
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construction industry. Three areas were
addressed: Provision of bank guarantees, access
to bridging finance and bank credit ratings of
construction companies. Black contractors are
currently receiving construction tenders
through government procurement processes, but
are unable to source funds from the relevant
financial institutions. The Alliance reported
that their members are then forced to either
forfeit the contract or enter into a joint
venture with a white company. According to the
Alliance, this trend does not contribute to
economic empowerment.
Similarly, access to bridging finance, credit
ratings and financing of commercial property in
black areas are barriers to emerging small
entrepreneurs. A construction tender requires
bridging finance and a credit rating from a
financial institution. Banks have given several
negative ratings to members of the Alliance.
They said that these problems are not confined
to micro and very small enterprises. They said
that small and medium established black-owned
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businesses (not just start-ups) were
encountering such problems.
3.
EYETHU Butchery
The presenter, the owner of several properties
and businesses employing more than 40 people,
is an established entrepreneur with a proven
track record. She has been a customer of
Standard Bank for the past 19 years. She
characterises her relationship with the bank as
a "hands off" relationship that has not
contributed to her success or business growth.
It was reported that the local bank manager
does not have a "passion" or commitment to the
development of SMMEs.
Bureaucratic requirements, imposed by the bank,
have slowed down the growth of her business.
Several of her (white) competitors have
developed more co-operative relationships with
the bank manager and are receiving preferential
terms from the bank. Access to working capital
is often restricted due to stringent collateral
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requirements. It was reported that when
collateral is provided, banks are still
hesitant to provide access to finance. This
impacts negatively on the cash-flow and stock
levels of the business, which in turn
influences the growth of the business.
4.
Citizens Finance, Financial and Business
Consulting
The presenter highlighted the important role of
banks in contributing towards the economic
growth of the South African economy. Previous
government policies were not supportive of SMME
development, especially black-owned SMMEs. It
is estimated that black entrepreneurs received
less than 2% of the total bank credit under the
previous government. It was argued that the
policy of banks has not changed in respect of
SMME finance.
Banks look more favourably to financing
empowerment deals that involve mergers and
acquisitions. Banks view SMMEs as a high risk,
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but poor performance of SMMEs is due to
underdeveloped entrepreneurial skill, which in
turn requires access to finance. There is no
history of an understanding between banks and
black communities. The government has begun
addressing several of these challenges through
the SMME strategy. The effectiveness of the
strategy needs to be evaluated.
Banks, in turn, have also introduced several
measures, including the Community Bank, that
was recently closed down. Banks have also
established the SMME desks and the Sizanani
project. It was suggested that the government
had overestimated the role of banks in
advancing the SMME sector. In general,
government policies have been correct, but the
implementation has been more difficult than
envisaged. As part of a way forward, the
presenter proposed that SMME policies be
targeted and focused. The existing economic
structure needs to be changed. This is a longterm objective.
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Banks must find new and creative ways of
providing access to finance. The SMME sector
must be made less risky. More training must be
provided. The government must increase funding
to SMME programmes and actively support
business associations. It was suggested that
consultation between banks and the government
needs to be strengthened to provide targeted
financial services. The presenter concluded by
proposing an improved communication between
banks and the government so as to establish a
dynamic relationship.
5.
Diakonia Council of Churches (DCC)
The objective of the DCC is to contribute to
peace, development and a better quality of life
for the people of the greater Durban.
Individual congregations have expressed concern
over the increasing unemployment and poverty in
the region. The DCC is a result of a response
to the local situation. A project of the DCC
includes life skills and technical and small
business training. In the past four years,
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over 1 500 people have been trained in a range
of skills such as sewing, electrical
installation, carpentry, construction and motor
mechanics. The presenter highlighted that the
idea of skills training is to generate "job
creators" rather than job seekers.
Several case studies were provided, which
emphasised the importance of access to finance
in creating a culture of entrepreneurship,
facilitating employment and providing income to
large numbers of vulnerable people. Several
barriers to micro enterprise development were
identified: Banks exclude micro entrepreneurs
on the basis that a minimum amount must be
maintained in a bank account; banks open
accounts for people with permanent jobs only;
and banks levy excessive administrative costs
and conditions. The micro and very small
enterprise sector is an important income
generator for a vast number of people.
The DCC proposed a change in the banking
"mindset" on risk and economic growth. It also
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proposed the removal of collateral requirements
for certain loans in the micro and very small
enterprise sector, no minimum amount for loans,
that interest be charged at market rates and
that loans not be linked to savings. The DCC
also called for improved sensitivity of bank
staff in local branches.
6.
National African Federation Chamber of Commerce
(Nafcoc)
The submission focused on the failure to accord
organisations like Nafcoc a more prominent role
in the SMME programme, the demographic make-up
of staff in the Department of Trade and
Industry responsible for the SMME programme,
and the slow pace of land reform, as
constraints faced by black entrepreneurs.
Nothing specific was said about banks and
access to finance by SMMEs.
C.
SA Reserve Bank: Bank Supervision Department (BSD)
The presentation highlighted the importance of
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banking and the significance of a sound, credible
financial environment for economic growth. The
Banks Act of 1990 provided for "prudential
regulation and risk management" of financial
institutions. This Act, reflecting a number of
concerns of the time, focused on the regulation of
deposit-taking institutions and prohibited nonregistered entities from accepting deposits. The
BSD's main function is to protect depositors and
maintain sound credit standards. The presenter
stressed the importance of a sound credible
financial system, and called for circumspection
when addressing structural challenges.
It was reported that over the years a number of
initiatives had been taken to address constraints
experienced by "unbanked people". These included
the passage of the Mutual Banks Act, the promotion
of community banking, stokvels, savings cooperatives, village financial service cooperatives, the launch of the Mortgage Indemnity
Scheme and consultations with stakeholders about
alternative strategies to informal financing and
micro-lending.
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There have also been moves to establish an
effective regulatory environment for the microlending industry through the Micro-Finance
Regulatory Council. It is possible that this
Council will facilitate the accepting of deposits
by micro-finance institutions. It was reported that
FinaSol and the Financial Services Association have
been appointed as regulatory bodies for the village
financial service co-operatives. All of these
initiatives have more or less operated on the basis
of exemption from the Banks Act.
The presenters expressed the view that what was
needed in the medium to long term was to facilitate
the emergence of new institutions that might be
more effective than banks in financing SMMEs. They
argued strongly that the government should not
force banks to lend to SMMEs, the so-called stick
method. They felt that greater success might be
achieved by increasing competition in the market.
This might be achieved by encouraging the emergence
of a securities market as an instrument for
accessing finance. Various co-operative ventures
could also be encouraged. The success of this
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strategy will largely depend on the availability of
financial information.
It was reported that the Reserve Bank, due to
improper practices encountered by various
institutions in the past, had expanded the
definition of a deposit-taker. This placed certain
restrictions on the emergence of what may be more
appropriate financial institutions. What was
required, was a streamlining and refocusing of
legislation, including the Banks Act, the Companies
Act, the draft Collective Investments Schemes Bill
and the draft Investments Services Bill, to
overcome current legislative restrictions that make
it impossible to access the securities market for
SMME finance. Redefining deposit-takers in
conjunction with the fine-tuning of the above
legislation was called for as part of a strategy to
promote competition between financial instruments.
The presenters also supported greater compulsory
disclosure by financial institutions of their
involvement in community-based activities,
including provision of finance to SMMEs.
14 SEPTEMBER 2000
D.
Page 167 of 177
Government
1.
Department of Trade and Industry (DTI), Chief
Directorate: Business Regulation and Consumer
Services, and Khula Enterprise Finance
The DTI highlighted the importance of the SMME
sector as a means of poverty alleviation, a
vehicle for black economic empowerment, in
increasing competition and promoting job
creation. The many barriers to SMME development
were re-emphasised.
The National Enterprise Survey, commissioned by
The Presidency with the support of the Ministry
of Trade and Industry, had reported that blackowned firms found it more difficult to access
finance than their white counterparts. The same
survey found that while access to finance was
not a major problem for South African companies
in general, it was for black-owned SMMEs. These
problems were particularly acute for recently
established enterprises, i.e. those that are
three years and younger.
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The survey highlighted the following problems
experienced by SMMEs in accessing finance: A
lack of collateral and equity finance,
effectiveness of affirmative procurement,
perception of risk, failure rate of start-ups,
management support systems, high costs of
operating SMMEs, and the adequacy of credit
guarantees. The survey also found that there
were relationship problems between bank
managers and black entrepreneurs, regulatory
inconsistencies, problems with high interest
rates, the Usury Act, the Credit Agreement Act,
a lack of second-tier institutions and tax
incentives.
Structural and institutional challenges require
sustainable interventions at several levels. As
with other stakeholders, banks have a crucial
role to play in the formation of capital in the
economy. The DTI recognised the global
constraints experienced by banks in South
Africa, and argued for an approach which
balanced the need for sound banking practice
against the imperative to extend services to
14 SEPTEMBER 2000
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people excluded from financial services. The
growth of the micro-lending sector had exposed
the slow responsiveness of South African banks
in entering profitable markets.
The government will continue to encourage banks
to improve access to finance for disadvantaged
communities and also to promote alternative
financial institutions. It was noted that it
was becoming increasingly difficult to measure
the extent of credit extension to SMMEs due to
definitional inconsistencies, but studies have
agreed that overall bank credit extension was
low. Another key challenge facing the
government was to work to improve banking
practices in relation to black entrepreneurs.
It was noted that SMMEs complained of continued
discrimination and blacklisting.
The presenter highlighted that banks were
crucial to any SMME strategy as a result of
their outreach, capital base, product and
expertise. Lack of competition in the banking
sector remained a fundamental problem. The DTI
14 SEPTEMBER 2000
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supported the promotion of the micro-lending
and credit union sectors as alternative
instruments, as well as the easing of
regulations to allow smaller banks to establish
themselves. It was reported that the DTI, in
consultation with other departments, was
looking into the implementation of a disclosure
requirement mechanism. The presenter cautioned
against simply importing a US-based Community
Reinvestment Act, given the different
structural model of US banking. There was,
however, support for compulsory disclosure of
the type contained within this type of
legislation as a step towards financial reform.
The low level of bank utilisation of the Khula
Guarantee Scheme was also highlighted as a
concern, and the DTI is at present monitoring
the unfolding scenario in this regard. The
participation of a range of stakeholders in
developing a strategy to address the many
challenges facing the SMME sector in accessing
finance was supported.
D.
Conclusion and recommendations
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Improving access to finance for black-owned SMMEs
is agreed by virtually everyone to be a major
priority of economic policy.
The hearings identified a number of "structural"
and "relationship" challenges that will have to be
addressed in making this priority policy objective
a reality.
Structural issues include transforming the present
financial architecture to make it more appropriate
to current priorities. This was argued particularly
in the submission of the SARB. A number of scams in
the 1980s led to the introduction of strict
controls over deposit-taking institutions, which,
while still warranted in many respects, tended to
limit the emergence of other financial
institutions. Alternative institutions today are
still largely operating on the basis of exemptions
from the Banks Act or Usury Act, rather than
according to their own purpose-built regulatory
framework. The Committee agrees with the SARB that
there is an urgent need for a systematic and
inclusive review of the broad legislative and
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regulatory framework of financial institutions with
a view to devising strategies to encourage the
emergence of a range of institutions that might
serve this segment of the market.
At this time, the Committee is of the view that the
banks need to play a more active role than they
have to date. The banks themselves agreed that
provision of finance to small and medium businesses
was very much an activity they needed to engage in,
and that by co-operating in specialist divisions
like Sizanani, they could serve the "very small"
sector as well. The only real debate, even
according to the banks themselves, was over
whether, and how, they could be involved in serving
the micro sector.
The Banking Council suggested that the costs of
finance, as well as being linked to the size of an
enterprise, was also a function of the degree of
access to collateral and the level of managerial
skill. The Committee proposes the exploration of
creative partnerships to address such constraints,
to deal with the perception of risk and co-operate
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in the promotion of alternative financial
institutions. Organisations like the Industrial
Development Corporation are already playing a
crucial role in the provision of finance, and need
to be more actively drawn into the strategy.
Mentoring is generally agreed to be a major
challenge, both to transfer skills and as a
mechanism for reducing risk. Focused and targeted
training linked to loan applications is clearly
required. Ntsika Enterprise Promotion Agency has
already launched several mentoring programmes.
Banks need to be engaged, both on ways they can
contribute to improving the efficiency of such
programmes and on how they can be validated in the
process of loan applications.
The system of payment of government contracts also
needs review, particularly as it impacts on SMMEs.
The Committee is aware that the Public Finance
Management Act should lead to ending the practice
of long delays in payment for work completed.
However, the question of finance for the period
between the award of a tender and completion of a
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contract needs attention. Black business people
complain that banks are currently not providing
bridging finance for SMMEs that have been awarded
tenders. Being awarded a tender, coupled with a
proven ability to perform, should, in the
Committee's view, be regarded as a form of
collateral by banks. Relevant procurement
authorities and banks should explore this issue.
In addition to structural issues, there are clearly
also a number of relationship problems. There are
too many black-owned small businesses who complain
that attitudes to banks are less than positive and
who feel that relationships are "at arms length",
for this dimension to be ignored. Entrepreneurs
complain of an alienating and unsympathetic
environment, and there is a clear perception that
black businesses are viewed less favourably than
white.
The Committee draws attention to the fact that
banks could face litigation under equality law if
they engage in discriminatory practices, including
"red-lining", which many say continue to be
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prevalent. Equality law also obliges banks and
other institutions to establish proactive measures
to combat the effects of discrimination,
particularly in relation to race, gender and
disability. The Banking Council, in its submission,
also drew attention to equality law and, in fact,
invited aggrieved parties to use this remedy to
deal with any discriminatory bank practices. Beyond
this, the Committees believes that banks need to
urgently review what the SARB called the
"politeness factor", and develop a more positive
attitude towards SMMEs. Steps need to be taken to
ensure that decisions taken by top management in
this regard are translated into meaningful change
at the level of local managers and officials.
Furthermore, in the Committee's view, there is an
urgent need for a uniform system of disclosure that
will allow the performance of particular
institutions in providing SMME finance and other
national priority activities to be measured and
compared to the performance of other institutions.
The Committee is of the view that this will require
legislative and regulatory intervention. There was,
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in fact, virtual unanimity amongst presenters that
uniform disclosure requirements allowing for such
measurement were necessary. While the US Community
Reinvestment Act was developed in a specific
context, different in significant respects from our
own, a broader discussion of the type of
legislation that is appropriate to specific South
African conditions needs to be encouraged.
The Committee noted that only one national black
business organisation representing SMME interests
participated in the hearings. Members of the
Committee expressed disappointment that the Nafcoc
presentation offered little insight on the issues
under review, which the National Enterprise Survey
identified as major constraints. Black business
needs an organised leadership to champion their
cause and lobby and negotiate in a more favourable
climate. The Committee hopes that organised
business in general, and black organised business
in particular, will in future be more proactive in
presenting proposals to deal with the many
constraints that black small entrepreneurs face.
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The Committee would like to thank all those who
participated in the hearings and endorsed the
continued engagement between the government,
organised business, black business and banks.
Report to be considered.