Budget votes take stock of progress
Parliament presided over a marathon budget vote session, with 40 departments noting the advances made in improving the lives of South Africans
Anew land audit on who owns South Africa, the gazetting of the much-anticipated Mining Charter, a recommitment to renewable energy and a push to fast-track the Black Industrialist Programme are some of the notable announcements that set the scene for inclusive growth and economic transformation when Ministers tabled departmental budget votes in Parliament recently.
Parliament presided over a marathon 40 departmental budget votes in May, with departments taking stock of the progress made in improving the lives of all South Africans and detailing programmes for the year ahead.
After President Jacob Zuma announced in the February State of the Nation Address (SONA) that government would use all levers of the state to usher in radical economic transformation, the departments used the budget votes to make announcements aimed at giving practical meaning to the call.
In his address at the time the President said interventions to accelerate economic transformation in the year ahead would include using legislation, regulations, licensing, budget and procurement as well as Broad-Based Black Economic Empowerment Charters to influence the behaviour of the private sector and drive transformation.
Calls for land audit to determine who owns South Africa
The debate over land ownership in South Africa has been the subject of calls by most sectors of society, from political formations to general members of the public calling for an equitable reform of land-ownership pattens.
Land Reform and Rural Affairs Minister Gugile Nkwinti also made this call during the debate on the State of the Nation Address.
Tabling the department's budget vote, the Minister said the department will conduct a land audit.
“Our biggest challenge remains the answer to the question – who owns South Africa?
“In terms of phase one of our land audit, it became clear that we still needed to conduct an audit in terms of land ownership by race, gender and nationality. We have just concluded the latter process,” he said.
Revitalising the value chain
Agriculture, Forestry and Fisheries Minister Senzeni Zokwana said there were a number of programmes through which the department sought to help smallscale farmers participate in the sector's value chain.
An example is the Revitalisation of the Agriculture and Agro-Processing Value Chain, which focuses on land reform, market access and trade, producer support, research and innovation and production.
Under market access, the Minister said for the financial year 2017/18, R2.2 billion had been allocated as a conditional grant to support farmers. He said R1.6 billion was for the Comprehensive Agricultural Support Programme, aimed at providing post-settlement support to the targeted beneficiaries of land reform and to other producers who have acquired land through private means.
He added that R522 million had been allocated to Ilima/Letsema, a programme focused on increasing food production and rehabilitating irrigation schemes and other value adding projects.
“In an effort to fast-track the transformation of the agriculture sector, specific attention will be given to the development of 450 large-scale black commercial farmers.
“For this financial year, I commit R220 million for the development of smallholder farmers to graduate to commercial farmers. Our target is to have 2 250 black commercial farmers by 2022,” he said.
More support for black industrialists
Industrialising the economy has been identified as one of the ways through which crucial job-creating sectors like the manufacturing industry, among others, can be supported going forward. This has also been seen as the best way to drive localisation.
In his budget vote Trade and Industry Minister Rob Davies said government's Black Industrialist Programme had already supported 46 projects since it was launched last year.
He said the department now aimed to reach its target a year early and support 100 black industrialists by March 2018, instead of the initial targeted date of March 2019.
“I am happy to report that as of now, we have approved 46 projects run by black industrialists, with government agencies, including the Department of Trade and Industry, Industrial Development Corporation, Public Investment Corporation and the National Empowerment Fund deploying over R2 billion in financial support on top of
“In an effort to fast-track the transformation of the agriculture sector, specific attention will be given to the development of 450 large scale
black commercial farmers”
R122 million in grants from the department,” he said.
The Minister said the support has enabled black industrialists to undertake investment projects worth
Economic Development Minister Ebrahim Patel said high levels of economic concentration and racially skewed ownership profiles stunted economic growth, prevented entry of new players, reduced consumer choice, limited the levels of innovation and dynamism in the economy and fed a growing resentment among black South Africans of the failure to realise the vision of the constitution.
“To address this, we will be finalising proposed changes to the Competition Act, as announced during SONA,” he said.The department released a framework in May and would work with a panel of experts to complete recommendations soon.
“To deepen our information base on the extent of transformation, we will work with other departments to quantify the extent of black citizen participation in the economy.
“To improve actions against collusion and corrupt corporate practices, the Commission will investigate about 100 cases of cartel behaviour in different sectors of the economy, including food, infrastructure, chemicals, financial services and car-parts,” he said.
The Industrial Development Corporation will target R7 billion for black industrialists and R2.5 billion for women- and youth-empowered companies this year.
“More than R4 billion will be put into localisation initiatives,” he said.
Calls for citizens to be Brand South Africa ambassadors
Communications Minister Ayanda Dlodlo said that to drive foreign direct investment into South Africa, citizens across all sectors of society should be patriotic.
Instead of only focusing on negative developments in the country, citizens should also tell the good South African stories.
“Recently, South Africa took second place in the
Africa Competitiveness Report and the country's global ranking for 2016/17 improved by nine places, from 56 in the 2014/15 report to 47 out of 138 countries worldwide, according to Brand South Africa.
“This work is vitally important and we all have a role to play in building our nation. Now is the time for a new spirit of patriotism and optimism.
“Now is the time for all South Africans to play their role as conscious brand ambassadors.
“All too often outside investors only get to hear the negative stories about our great nation. It is up to us to highlight the many positive things about our nation and our people,” she said.
The department will continue to prioritise and support media transformation through the Media Diversity Development Agency (MDDA).
“We are pleased that in the current financial year the MDDA will present the 10-year impact study which sought to assess the effectiveness of the impact made since the MDDA's inception in 2002.
“The MDDA must continue supporting projects that promote the active role of people with disabilities into the sector and place greater emphasis on correcting gender imbalances, both in terms of ownership and management of community media, and in the newsroom, as well as on how women are portrayed in the media,” she said.
Ensuring universal health coverage through the NHI Fund
Earlier this year government announced that it was looking to set up a National Health Insurance (NHI) Fund and that a number of options would be explored.
This would include the possibility of tapping into the tax credit on medical scheme contributions.
In his budget speech Health Minister Aaron Motsoaledi announced that tax credits announced in the February budget amounted to R20 billion.
“Yes, R20 billion that in 2015 and annually will leave the fiscus through SA Revenue Service back to the pockets of people, simply because they are members of a medical aid scheme,” he said.
Minister Motsoaledi said returning these tax credits back to medical aid schemes instead of using it for universal health coverage did not make sense.
He said such funds should be used for the greater good and to fund the less privileged.
Mining Charter to be gazetted soon
Mineral Resources Minister Mosebenzi Zwane has announced that his department will soon publish the Mining Charter for public comment.
The Minister said he has consulted about 60 stakeholders and that their views and concerns will be reflected in the review.
“The review of the Mining Charter, which was gazetted in April 2016 for public comment, is almost complete.
“Although we had initially intended to have the process finalised in March 2017, further consultations have been undertaken and we are confident that the Charter that will be gazetted will be reflective of the careful consideration given, substantive inputs received and meaningful engagement with stakeholders,” he said.
Tourism Minister announces new transformation fund
Tourism Minister Tokozile Xasa has used her maiden budget vote speech to announce the establishment of a transformation fund to assist new entrants and emerging players in the sector with access to funding.
She said funding in the sector has been a challenge for some time.
This, the Minister said, restricts growth of small enterprises, expansion of their existing products and participation by communities, as it is difficult to obtain operational finance.
“In recognition of this challenge and with the support of the National Treasury, we have entered into a partnership with the National Empowerment Fund (NEF) to establish a Transformation Fund.
“A combination of grant funding and debt financing will be used to drive sector transformation and unlock capital investment in tourism.
“The fund is currently capitalised to an amount of
R120 million with the aim of building it to R360 million in the medium term,” she said.
The fund will include NEF equity, debt and grant funding from the Department of Tourism.
“The grant funding will be capped at R5 million. It will be accessible in the second quarter of the 2017/18 financial year,” she said.
The Minister added that the department will set aside R1.1 billion to increase global market share and grow the domestic tourism market in a manner that promotes inclusive growth.
“Our goal is to attract five million additional tourists to South Africa within the next five years,” she said.
She added that the empowerment of women is central to the department's transformation agenda.
The department will continue implementing its Women in Tourism Programme.
“Women in tourism are mobilised behind representation, recognition, reward and respect,” she said.