Category: Politics

Acting Minister in The Presidency, Khumbudzo Ntshavheni will tomorrow brief media on the outcomes of the Cabinet meeting held on Wednesday, 26 May 2021.

The details of the briefing are as follows:

Date: Thursday, 27 May 2021

Time: 11h00

Venue: GCIS – Ronnie Mamoepa Press Room, Tshedimosetso House, 1035 Francis Baard Street, Hatfield, Pretoria.

Source: Government of South Africa

Premier of the Northern Cape, Dr Zamani Saul and Deputy Minister in the Presidency, Thembi Siweya, will meet residents of Springbok as part of a government outreach to provide easy and direct access to government services.

In response to the Department of Planning, Monitoring and Evaluation’s frontline monitoring report that highlights a need for service improvements, Premier Saul and Deputy Minister Siweya will host a service fair in Springbok which is based in Namakwa District Municipality, North Cape Province.

The service fair will include mobile stalls of departments such as Home Affairs, Social

Development, South African Police Services, Employment and Labour and National Youth Development Agency where residents will be able to access essential government support.

The service fair will be preceded by an Imbizo where community members will have an opportunity to engage with their leaders and raise issues they consider to be of interests.

Subsequent to the service fair and community engagement, Premier Saul and Deputy Minister Siweya will officiate the opening of the state-of-art Port Nolloth Community Health Centre.

On the day, the Premier and Deputy Minister Siweya will be Joined by several National Government, Provincial and local leaders that include all Members of the Executive Committee in the Northern Cape, Deputy Minister of Home Affairs, Njabulo Nzuza, Deputy Minister of Water and Sanitation, David Mahlobo, Deputy Minister of Human Settlements, Pam Tshwete and Deputy Minister of Agriculture, Rural Development, Rural Development and Land Reform, Mcebisi Skwatsha.

Source: The Presidency Republic of South Africa

Address by the Deputy Minister in The Presidency, Ms Thembi Siweya, MP, on the occasion of the 2021/22 budget vote for the Department of Planning, Monitoring and Evaluation; National Assembly, Parliament Of South Africa; Cape Town

It is a pleasure for me to present this Budget Vote on behalf of the Department of Planning, Monitoring and Evaluation (DPME). The outbreak of the Coronavirus and its effects on our livelihoods, has made us appreciate the smallest things in life. We can no longer take for granted the gift of life, health and wellness.

The Coronavirus has robbed many of us our loved ones and, as much as we have managed to minimise the death toll in South Africa, every life lost is one too many. Let me once again convey my heartfelt condolences to the family and friends of the late Minister Jackson Mthembu, who led this Department with excellence. We remember him for his larger than life personality and selfless dedication to serving the nation. The world is poorer without him.

South Africa has survived some of the worst atrocities ever experienced by humankind, and we are sure to prevail over the current crisis. We are already on course to recovery. The vaccine programme is underway and the Economic Reconstruction and Recovery Plan announced by the President in October last year outlines our way out of the economic challenges brought about by the pandemic.

Our role as the DPME is to ensure that government departments and state entities implement integrated programmes that advance our national vision as articulated by the President during the State of the Nation Address. The Department is mandated to institutionalise planning, develop a robust monitoring system backed by evidence and evaluate government programmes and their contribution towards the National Development Plan (NDP).

Madam Speaker, The NDP remains our lodestar as we make efforts to deal with the triple challenges of poverty, unemployment and inequality.

As the DPME, we are duty-bound to ensure that all government components and state-owned entities remain focused in the primary task of creating jobs, reduction of poverty and inequality as espoused in the NDP. We recognise the need to further strengthen planning and improve the integration and harmonisation of planning at all levels towards the realisation of the country’s development goals. To achieve these objectives, the DPME will in the year ahead develop the Integrated Planning Policy Framework and revise the Integrated Planning Framework Bill.

We believe that a critical component of this project of institutionalising planning is spatial planning because it will assist us to expedite the task of reversing apartheid spatial development patterns and achieve spatial transformation and spatial justice. To this end, we are working with the Department of Agriculture, Land Reform and Rural Development (DALRRD) in finalising the National Development Framework, which will embed the spatial element of the development agenda and complement the NDP and the MTSF.

We welcome the review of the implementation of the NDP by the National Planning Commission (NPC), which has pointed out some of the gaps in implementation and made recommendations that will inform the re-invigorated implementation strategy with credible delivery mechanisms and priorities.

I am pleased that the NDP Review as well as the end-of-term Handover Report has been submitted to Cabinet. As the term of the current NPC is coming to an end, we have a process for the appointment of the new Commission for the 2021 – 2026 term.

Madam Speaker, we wish to express our gratitude to the out-going Commissioners for the remarkable work that they have done over the past five years and believe that their reports will be valuable in the development of future plans and implementation strategies.

Madam Speaker, the outbreak of COVID-19 pandemic in South Africa happened at a time when government was gearing itself for the implementation of the 2020/21 financial year. In view of the COVID-19 disruptions and the concomitant lockdown, the DPME had to review and reprioritise aspects of the 2019 – 2024 Medium-Term Strategic Framework (MTSF) to align them with the current challenges confronting our society.

The MTSF is a five-year government programme through which the NDP Vision 2030 is implemented. It provides a framework for policy coherence, planning, budgeting, monitoring and evaluation at national, sectoral and institutional levels and across the spheres of government. The 2019 – 2024 MTSF is structured according to the seven priorities and aligned to the electoral mandate of the governing party, which form the basis for the programme of the sixth administration. This new implementation paradigm is a radical shift to a comprehensive framework that is inclusive of resourcing, integration of all public sector institutions and social partners.

The 2019 – 2024 MTSF combines the NDP Five-Year Implementation Plan with a revamped Integrated Monitoring System and accountability framework. The MTSF translates the Seven Apex Priorities of the Sixth Administration into actionable deliverables. The seven priorities include:

• A capable, ethical and developmental state;

• Economic Transformation and Job Creation;

• Education skills and health;

• Consolidating the Social wage through reliable and quality basic services;

• Spatial Integration, Human Settlements and Local Government;

• Social Cohesion and Safe Communities, and;

• A Better Africa and World.

It further prioritises the empowerment of women, youth and persons with disabilities across all the seven priority areas as integral to the achievement of our constitutional vision of a more equitable and inclusive society. Government’s programme of action, including the Annual Performance Plans (APP) of all departments, is aligned with the Seven Priorities. The DPME will be monitoring how government departments and state owned entities are implementing the seven priorities in their respective sectors. We will produce regular reports and recommend corrective measures where there is failure in the implementation of the priorities.

The top priority of “A Capable, Ethical and Development State” underpins all seven priorities of the MTSF and is the most germane to the work of the DPME. One of the fundamental elements in building a capable state is a public service that has the requisite human capabilities, institutional capacity and attendant systems to deliver on the national imperatives as envisioned in the NDP.

As part of ensuring good governance and accountability, government departments are required to be well capacitated, and that the vacancy rate should be below 10%. The DPME vacancy rate is far lower than this threshold. Gender parity remains well balanced in the DPME, with women being the majority in senior management. The Department attracts qualified, skilled and dedicated personnel that helps us fulfil our mandate, raise the bar high and set new benchmarks for service delivery.

We are pleased to announce that the DPME has obtained yet another clean audit from the Auditor-General South Africa (AGSA), registering eight consecutive clean audits received by the Department since its inception. This reaffirms and epitomises the DPME as an excellent model for the public sector. We lead by example.

In line with the imperatives of Priority 1, the department developed a new National Anti-Corruption Strategy. This strategy was developed through a comprehensive consultative process which involved civil society, academia, business and various clusters of government. We will facilitate and monitor the implementation of this strategy during the MTSF period.

With regard to Priority Two, we will produce performance reports on selected State Owned Entities (SOEs) in the areas of Water, Energy, Roads infrastructure, Broadband and Rail Infrastructure. Government has embarked on a massive drive to build infrastructure in these areas, and it is imperative that South Africans from all sectors of society benefit from these developments.

We will also do the assessment of the availability, implementation and rollout of broadband network so that we can create an enabling environment for rapid expansion through licensing and increase of the spectrum.

Among the factors that relate to Priority Three, monitoring systems will be put in place to set us on a path for phased implementation of the National Health Insurance (NHI) to achieve universal health coverage for all South Africans by 2030. Our work will focus on the upgrade of public health facilities and reduction of costs for private healthcare. The cooperative manner in which both the private and public healthcare centres handled the COVID-19 pandemic, is an affirmation that universal access is achievable.

One of the major injustices visited upon the people of South Africa was land dispossession. Land Reform in South Africa is aimed at resolving social, economic and transformation conundrum that is as a result of our historical injustices. The DPME sits in the Inter-Ministerial Committee for Land Reform and forms part of the technical team and is responsible for producing monitoring reports on the land claims projects. We will continue producing monitoring reports to keep us abreast with the developments and help us ensure that the pace of land reform is in line with the timelines of the NDP.

The adoption of the African Continental Free Trade Area (ACFTA) is a major milestone towards the realisation of Priority Seven, which envisages a “Better Africa and World”. This is a vital step in improving collaboration and co-operation, as well as fostering integration, increasing trade and accelerating the building of productive capabilities and infrastructure amongst African countries. The DPME will monitor the implementation of the African Continental Free Trade Area while at the same time identifying new areas of collaboration and greater macroeconomic opportunities.

Madame Speaker, I could be detailing the work we will be doing in each of the seven priorities, but time will not allow. Suffice it to say, every output, every deliverable and programme within the DPME is aligned with the seven priorities.

We will continue to guide departments at national and provincial levels to ensure that Strategic Plans and APPs are aligned with the MTSF and key policy interventions such as the Economic Recovery and Reconstruction Plan.

The DPME will continue to monitor the implementation of the MTSF and the Economic Reconstruction and Recovery Plan to track progress in the implementation of the intended outcomes and produce periodic reports. These reports will culminate into Bi-Annual MTSF Integrated Monitoring Reports which will be submitted to Cabinet. These reports are vital in generating the Ministerial score cards, which will be key in the performance assessment of Cabinet members.

Madam Speaker, the NDP serves as the platform through which government localises its international, continental and regional commitments. A recent analysis by the United Nations Development Programme (UNDP) indicates that there is a 74% level of alignment between the NDP, AU Agenda 2063 and the United Nations’ Sustainable Development Goals (SDGs). This report will be submitted to Cabinet in due course.

DPME, through the NPC Secretariat, is responsible for the Coordinating Mechanism for sustainable development in the country as adopted by Cabinet in 2019. A Voluntary National Review (VNR) on SDGs reporting on AU Agenda 2063, regional integration across the Southern African Development Community (SADC), other sustainable development plans, as well as on NDP, will be produced as part of this mechanism.

Madam Speaker, through our Public Sector Monitoring and Capacity Building programme, we will continue to work directly with communities to enhance service delivery. We will intensify our efforts to position the Presidential Hotline as the gateway to government services. The Presidential Hotline facilitates communication between government and the citizenry in order to find solutions to service delivery challenges. Our objective is to ensure that the majority of service delivery complaints are resolved expeditiously.

The DPME coordinates the evaluation of policies, programmes and processes across the public service in order to support the developmental impact of government. Considering the changed context, the DPME has initiated a process to revise the National Evaluation Plan (2020-2025) in order to align with the available resources and emergent priorities following the COVID-19 disruptions and the revised MTSF.

All evaluations in the National Evaluation Plan are implemented through partnerships with the custodian departments. We are happy to see that partner departments have used the evaluation results to introduce improve their systems and create value for the citizens. For instance, an evaluation of the Birth Registration Programme assisted the Department of Home Affairs (DHA) to finalise the Birth Optimisation Strategy. We are happy to note that a system to digitise birth registration information is being implemented to enable all birth registrations to be completed within the legislated 30-day period. An Evaluation of Older Persons Act has been instrumental to in informing the Older Persons Amendment Bill.

In building a smarter organisation, the DPME has started with the development of the Centralised Data Management and Analytics System (CDMAS). Among other benefits, this system will simplify the submission of performance information by departments to the DPME, improve knowledge management and the production and dissemination of performance reports.

Our monitoring and evaluation approaches have been enhanced by the District Development Model (DDM), which aims to improve the coherence and impact of government’s service delivery efforts. The DDM will ensure that plans translate into implementable programmes and this would give us a clear line of sight in monitoring implementation, from national to provincial, right down to the district level.

Madam Speaker, to ensure that the lessons learned in dealing with pandemics of this nature are not lost, the DPME has compiled a country report of South Africa’s response and management of the COVID-19 pandemic. This will provide a baseline for approaches in handling pandemics and disasters of a similar nature. On this note, I wish to extend a word of gratitude to our partners, the Government Technical Advisory Centre and the National Research Foundation and the many research experts across the country who have contributed to the production of the South African COVID-19 Country Report.

To curb incidents of corruption and irregular expenditures around the vaccination programme, the DPME has since developed the Corruption Risk Mitigation Plan for the COVID-19 vaccination programme. Bi-annual reports will be released and the first report is due by the end of June 2021.

As I conclude Madam Speaker, it is important to reiterate that the DPME has a vital role to play in ensuring that all departmental plans are geared towards the realisation of the six priorities identified by the 6th Administration. To this end, the 2021/22 strategic plan focuses the work of the Department in ensuring that the MTSF 2020-2024 is fully implemented, monitored, constantly reported and critical government programmes are evaluated. Although we would have hoped for more resources to cover this magnitude of work, we welcome the DPME’s voted budget of believe that the allocated budget Four Hundred and Fifty-Three million (R453 million) for the 2021/22 financial year. I therefore invite the House to support this statement as the Budget Vote for the Department of Planning, Monitoring and Evaluation.

I thank you.

Source: Government of South Africa

Address by L N Sisulu, MP, Minister for Human Settlements, Water and Sanitation on the occasion of the Debate on the Water and Sanitation Budget Vote (41) in the National Assembly

Chairperson

Honourable Members

Acting Director-General, Panel of Advisers and Heads of Provincial Departments

Members of Boards of Water Entities

Ladies and Gentlemen

When we took stock of what we achieved in the past twelve months, it became clear that that which we need to report on is far greater than the time given to us. I therefore resolved to prioritise the following:

• To indicate what resources have been allocated to the Department for this financial year;

• Deal with the concerns raised by Members of the Portfolio Committee in the course of the past year; and

• Discuss the major projects that are currently under way, i.e. the Water and Sanitation Master Plan, the Lesotho Highlands Water Scheme Phase II and the South African Human Rights Commission’s Report on the Vaal Sewerage Problem and our response.

We have compiled a comprehensive and detailed report, which will be made available to the Portfolio Committee on all the work done and what we accomplished in the past financial year.

Having said that, I need to start off by thanking the leadership of the Department of Water and Sanitation. Firstly, the Director-General of the Department of Human Settlements, Mbulelo Tshangana, who spent a great deal of time steering the ship back to sea and keeping a steady hand on the rudder in the time that he spent with us. Secondly, to the acting Directors-General, Trevor Balzer and currently, Deborah Mochotlhi, members of the Advisory Panels and the officials in the Department who stayed the course. And thirdly, the current Water Boards and Catchment Agencies that have not deviated from their mandate. We have had difficulties in this sector and we have braced ourselves for the enormous challenges that lie ahead, but we can confidently declare that we are making progress.

Just yesterday I had the most amazing experience where farmers, the unemployed, representatives of the mining sector and the agricultural sector gathered in Kimberley to thank the Department for an exceptional intervention to deal with the drought in the Northern Cape Province.

The final departmental appropriation budget for the financial year that ended on 31 March 2021 was R16, 999 billion, whose expenditure amounted to R14.503 billion, representing 85% of the total adjusted appropriation. In the coming MTEF period, the estimated budget allocation is as follows:

2021/22 R 16, 9 billion

2022/23 R 17, 4 billion – an increase of 2,9%

2023/24 R 18, 03 billion

The prognosis for the Department is good. To begin with, we have had a number of unqualified audits, against all odds, which is a significant improvement. Further, we established a Disciplinary Committee late last year, to deal with all cases referred to us by the Auditor-General and SIU reports and are making good progress. Out of these there has been several recent arrests, secured on the irregularities at Lepelle Northern Water. We await further reports on cases currently under investigation by the South African Police Service and will report to the Portfolio Committee on these.

We have also restructured the Department to deal with the many vacancies that the Portfolio Committee has raised concerns about and have received the necessary concurrence of the Minister for the Public Service and Administration. We have progressed to legitimise all Boards of Water entities that had previously not been approved by Cabinet and will soon conclude this process. To all those who served us faithfully on the respective Boards, our gratitude.

We are beginning to see the results of the hard work that we have put in. However, a number of challenges remain and new ones confront us on a regular basis. National Treasury has given a warning that our country will not be able to sustain inclusive economic growth and economic transformation if severe water constraints occur. This puts an enormous burden on us, given the limited financial resources that are available and the state of our infrastructure. It is in this context that I am very glad that we have the TCTA, whose job it is to access financial markets to raise the funding, in order to implement mega water infrastructure projects, which are necessary to keep the country water secure. The sustainability of off budget funding, which the State must increasingly rely on to fund infrastructure given the limited fiscal space, means that we must strengthen and give support to those water sector institutions that raise funding.

I am pleased to announce that the TCTA, which received an unqualified audit opinion, has already amassed a R68 billion pipeline of water resources projects,that will start delivering water to South Africans before the end of the decade. These include LHWP-2, uMkhomazi Water Project, Mokolo-Crocodile Water Resources Development Project, and the augmentation of the Western Cape water supply system. Together these projects impact 70% of the economy and our major metropolitan areas in Gauteng, KZN and the Western Cape.

After obtaining the concurrence of the Minister of Finance for the Guarantee Agreements, I gave my consent for the TCTA to conclude loan agreements with and approved the issuance of Government Guarantees to the respective lenders. This allowed the TCTA to raise R15,45 billion in the capital markets from investors to continue construction of the Lesotho Highlands Water Project in relation to the Vaal River System. So, we have the resources, we have the guarantees and now we can assure you that we will be hard at work to provide water security.

A few months ago we had a most pleasant and productive engagement with the senior executives of the Johannesburg Stock Exchange and are very proud of this very necessary ally. The Team from the JSE, led by its CEO, Dr Leila Fourie, informed us of the role it can play in funding the water projects that have been proclaimed and we look forward to continue using the funding capacity of the JSE, to finance our capital expenditure and infrastructure development programmes.

However, on the funding side we still have to tighten up a few areas that could improve our economic stability. At the moment, the money lost through non-payment to our Water Boards by municipalities stands at R12,6 billion as at March 2021. In a recent study we discovered that about 41% of our municipal water is non-revenue which means water is not being billed or paid for and we are losing the value of around R9.9 billion down the drain, either because of physical losses and leakage from server connections, or municipalities are not paying their debt, or municipalities are not collecting from our users. That leaves us as a department so much poorer to perform our responsibilities and those owed and lost billions could have been put to good use in maintaining infrastructure.

On the municipal debt, we need to ensure that water tariffs are cost-reflective, fully implemented and can repay debt. Going forward, we must ensure that credit control measures are enforced to arrest increasing debt. We have no choice but to do this because the availability and cost of off budget funding, now and in the future, depends on our ability to overcome these financial challenges. Until then, water sector entities as funders will rely on government guarantees until they get the necessary support, which the fiscus is finding increasingly difficult to accommodate.

As you know, we launched the National Water and Sanitation Master Plan for consultation in 2019 as a “Call to Action”. This sought to rally all South Africans to work together to address the challenges confronting our sector. The Plan has been on our website ever since, inviting comments from interested parties. We have received a great deal of support and responses that have enriched the Master Plan, including, I must add, endorsement from a variety of organisations, such as Agri-SA, the Black Farmers Association of South Africa and to our great surprise – recently from the DRC! I mention the DRC because President Mbeki informed me a few months ago that water from the DRC has been former Namibian President Sam Nujoma’s life-long dream. We will be following up on this to make it a reality for ourselves and President Nujoma.

The Master Plan points out five key objectives that define a ‘new normal’ for water and sanitation development and management in South Africa. It will serve in Cabinet, hopefully within the next month for final endorsement and we will put aside an appropriate date thereafter to formally set it in motion. It is a transformative document and has been well received by all. When we officially launch it, it will no longer be called the Master Plan but the “Water Charter – ensuring water for all”, which will fundamentally change the water environment. It is a redistributive instrument that ensures that there is equitable distribution of water, which would also result in increased water saving measures. A copy of the draft Plan is available to all Members.

Even though we are doing as much as we can in the provision of sanitation services, there are huge challenges facing this sector. Some of these are as a result of unplanned, rapid urbanisation which is putting increasing strain on our heavily burdened infrastructure, inadequate investment in operation and maintenance and the reprehensible theft of cables and water infrastructure. Our Waste Water Treatment Plants are regularly vandalised by criminal elements that often render our Plants inoperable. We are now required to increase our security and declare essential dam security points. We will also lobby for maximum penalties for all who criminally interrupt our work.

We have made significant progress in addressing access to sanitation. Households with access to sanitation have increased from 49% in 1996 to 83% in 2018 (STATS SA, 2019). However, there is still approximately 2.8 million households, which is 17% of households, without access to improved sanitation services. The Master Plan deals with our commitment in this regard. For the time being, innovative technology is available to assist us and we thank the Water Research Commission that organised the support of the Bill and Melinda Gates Foundation in this regard.

There is a need to embrace technology – in this case, technology that will reduce water demand. While waterborne sanitation system is the first preference in most cases, we should accept the reality that it might not be practical to install a flushing toilet in every household for the foreseeable future. The department is working with the Water Research Commission and Department of Science and Technology to find alternative sanitation solutions.

This brings us to the matter of national concern – the pollution of the Vaal River System. The Deputy President and ourselves have been seized with what has to be done at the Vaal in order to protect the Vaal River System, which spans three provinces and two countries.

What has got us to where we are in the Vaal crisis can be grouped into three pillars: infrastructure, governance & institutional capacity and finance. The problem will not be solved with infrastructure capacity only. There are additional factors, such as other provinces contributing to the crisis, resulting in the continued state of pollution of the Vaal River. Because of its geographic position and flat topography, the Vaal has become a collection point from various sewer points and putting excessive strain on operation and maintenance of pumps at stations. Ideally sewer treatment is a municipal service that requires costs recovery as a minimum. However, the high unemployment and dwindling revenue collection in the Vaal area is making it difficult for the Emfuleni Municipality to recover any costs or generate an income to cover operation and maintenance, let alone expansion of the treatment plants.

My Department and I have spent a great deal of time attempting to solve the problem, attempting to help the municipality and have been greatly assisted by the Vaal community. Our sincerest gratitude goes to all who have come forward to assist – the local engineers, the business community and the residents.

But by 17 February 2021 the Human Rights Commission had issued a report on its own investigation and instructed ourselves to intervene in a decisive manner and take overall responsibility to restore the rights and dignity of the people of Emfuleni. We have since been in discussions and received the concurrence of the Minister of COGTA, the Premier of Gauteng, and the support of the Deputy President to intervene in terms of section 63(2) of the Water Services Act, 1997. We are, all three spheres of government, in agreement that this should be done and we have already put in place steps to implement this, pending Cabinet agreement.

Henceforth the responsibility of the Emfuleni Municipality as a Water Service Authority will be taken over by the national government and Rand Water has been appointed as the Implementing Agent to take full responsibility of operations and maintenance of the municipality’s water and sanitation infrastructure. Coupled with this is the refurbishment of the waste water systems. The necessary resources have been secured and to this end an amount of R1.1 billion over the MTEF period has been set aside for refurbishment of the waste water treatment plants. In addition a further amount of R700 million over the MTEF period has been set aside to add more capacity on the sewer network. This is a matter that we have been dealing with together with the community of the Vaal. It has taken up a great deal of our time and we are glad we are at this point.

In the coming weeks, the Department would have finalised the appointment of contractors for them to immediately be on the ground to urgently address the dire situation. We have already started putting out requests and advertising for engineers – only South African engineers. This brings me to this point. No foreign engineers are given tenders by the Department. The Cuban engineers that Solidarity has been obsessed with are here for mentoring our rural municipalities. They are not taking anyone’s job, nor are they eligible to tender.

We all know that the country needs to invest heavily in water infrastructure to secure our economic and social wellbeing as a country. Infrastructure investment is key to the country’s economic recovery from the devastation of Covid-19. In the past year, these are the projects we worked on and completed.

• 1 bulk raw water project under construction

• 106 regional bulk infrastructure project phases under construction

• 10 regional bulk infrastructure project phases completed

• 382 small water services infrastructure projects under construction

• 112 small water services infrastructure projects completed

• Vaal intervention project implemented

• 39% projects (i.e. 474 of 1203) completed as per Maintenance Plan (Planned Maintenance)

• Unscheduled maintenance projects completed as a proportion of planned maintenance projects was kept at 26%

• 25 dam safety projects evaluated

• 1.9518km conveyance systems rehabilitated

• 1 037 job opportunities created through implementing water infrastructure projects

• 428 non-compliant wastewater systems monitored against the Regulatory Requirements

• 366 non-compliant water supply systems monitored against the Regulatory Requirements

Chairperson, I need to indicate that for the coming financial year, we have prioritised the following water infrastructure projects:

• Mdloti River Development Project: Raising of Hazelmere Dam

• Greatt Letaba River Development Project (GLeWAP): Raising of Tzaneen Dam and Nwamitwa Dam

• Olifants-Doorn River Water Resources Project: Raising of Clanwilliam Dam

• Mzimvubu Water Project

• Olifants River Water Resources Development Project

• Cwabeni Off-Channel Storage Dam

• Stephen Dlamini Dam

• Berg River – Vo?lvlei Augmentation Scheme

• Lusikisiki Regional Water Supply Scheme: Zalu Dam

• Mokolo and Crocodile River (West) Water Augmentation Project

• Foxwood Dam

• uMkhomazi Water Project

• Algoa Water Supply System

I am happy to announce that we are now on Phase II of the Lesotho Highlands Water Scheme, which we launched in Lesotho at Polihadi on 13 November 2019. Cabinet has recently endorsed the appointment of a Chief Delegate and Alternate to the Lesotho Highlands Water Commission and these will be in place by end June 2021.

The Lesotho Highlands Water Project (LHWP) is a multi-phased joint water resource development project and is very important for both Lesotho and South Africa’s social and economic wellbeing. Phases 1A&B of the LHWP which comprises Katse and Mohale Dams, transfer and delivery tunnels from Lesotho Highlands to the Vaal Dam in South Africa, and Muela Hydropower Station continues to deliver measurable and tangible benefits to both parties. Phase II is now underway and I keenly await the Committee’s report on its recent oversight visit to Lesotho.

South Africa currently receives approximately 780 million cubic meters of water per year from Lesotho into its Integrated Vaal River System (IVRS) which supplies water to Gauteng and the surrounding areas. The IVRS needs to be urgently augmented in order for it to cope with the increasing water requirements. This is becoming even more evident as we grapple with more frequent drought situations in this economic hub of our country. No doubt you will have taken note of this from recent television coverage.

Phase II of the LHWP comprises the construction of Polihali Dam, which will provide an additional 465 million cubic meters of water per year and thus bringing the total to about 1245 million cubic meters of water per year into the Integrated Vaal River System from Lesotho.

The Water Boards play a critical role within the water value chain. In this regard, we have strengthened and improved the governance of the Water Boards. There are permanent boards for the Amatola Water, Bloem Water, Mhlathuze Water, Overberg Water and Rand Water. We finalized the process of appointing boards for Lepelle Northern Water, Magalies Water, Sedibeng Water and Umgeni Water to run for a period of four years from the date of Cabinet concurrence in order to stabilise and improve the governance operations of these entities.

The President indicated in his SoNA that the National Water Resources Infrastructure Agency that has been so long in the making would be established. The enabling Bill will be tabled in Parliament as soon as it has been approved by Cabinet and we hope Parliament would deal with this Bill with the necessary urgency.

We had previously committed to speed up the provision of Water Use Licences. The Department has been able to make the necessary changes to its regulatory regime to give effect to the 90-day turnaround time with effect from 1 April 2021.

Where existing water resources are already fully used, the National Water Act gives the Minister the power to undertake a compulsory licencing process to reallocate water use licences. The process provided in the National Water Act was designed and certified as constitutionally compliant. This is an important provision in the law to redistribute water licences to ensure equal distribution of our water resources for all. The transformation of the water sector is long overdue and our emphasis is to fast-track this particular process – transformation in our lifetime.

With the view of improving service delivery and promoting efficiencies within the Department, I have dealt with a matter that has been of great concern to the Portfolio Committee, i.e. the organisational structure of the Department and the filling of vacancies. A revised macro organisational structure for the Department of Water and Sanitation has been approved, with the concurrence of the Minister for Public Service and Administration. Through a consultative process, all senior managers have temporarily migrated to posts on the revised macro structure to ensure it is fully functional. Within available budgets, the Department is in the process of recruiting competent individuals to fill vacant senior management posts.

The other matter of concern to us and Parliament are the disciplinary cases. A Disciplinary Committee has been working with all the competent legal and investigative support to finalise these. We hope that we will be able to report to Parliament in full on the outcome of these cases as soon as these are concluded. When the Disciplinary Committee briefs the Portfolio Committee it will be clear how much work has been covered. Our emphasis now is clean governance and every effort is put in place to ensure that this bears fruit.

There are two remarkable things that came out of our response to the Covid-19 pandemic – we established the National Water Command Centre, which did incredible work under immense pressure and shows our state of readiness to deal with any crisis. Secondly, we nationalised water and there was no squeak from anyone – not even Solidarity. They were probably in solidarity with us then – oh what a country. We are back to normal now and have learned a great deal from this.

I thank you

Source: Government of South Africa

Budget Vote Speech 2021 Speech by Minister Pravin Gordhan, MP

Chairperson, Honourable Members, Chairpersons And CEOs Of SOE Boards, Ladies and Gentlemen

I have the honour to present the Budget Vote for the Department of Public Enterprises for the 2021/22 financial year.

At the outset, I wish to pay tribute to our health care workers: the sacrifices; their bravery in putting peoples’ lives first during the COVID pandemic. They symbolize the caring society we want to be; the resilient people we are; turning adversity into hope and action to save lives.

This is a singularly important lesson for all of us in the public sector – political and non-political employees of the democratic SA state.

I also acknowledge the excellent work of

• Solidarity Fund and the solidarity of corporates with all our people.

• Workers in Transnet, Eskom, Prasa, and elsewhere – workers in the frontline of keeping economic activity going. This is the true meaning of any compact between different sectors of our nation.

A day after the 80th birthday of Bob Dylan I quote a commentator who said: “ we’re listening to a very political artist. An artist who comes again and again – speaking truth. But an artist who fears that “power and greed and corruptible seed seem to be all that there is”. And thus an artist trying to fight his way through his disgust and the despair that this vision engenders. An artist who, in so doing, returns us the slim hope provided by artistic communion; that by naming it, and seeing it, and singing it, we might yet overcome our own darker nature or at least keep it at bay”

Chair, the mission assigned to us by the President is: uncover and deal with the past full of corruption and greed; stabilize governance, operations and finances of these SOEs so that they return to their basic mandate; and, importantly repurpose, redirect, restructure them with the board to meet the demands of SA’s economy and its people and the opportunities in their sectors. This they must do to be innovative, to be market shapers in these sectors and combine their efforts with those of the private sector and civil society.

Ultimately, these entities must be capacitated and led with total integrity to the new horizons we set for them. Nothing less will do.

At the same time, we are realistic. We fully appreciate that these demand radical changes, which will be arduous and will take time. There are indeed no quick fixes. Nor can we deny the massive and orchestrated resistance by the engineers and beneficiaries of corruption. That will only stop when all of them are in jail.

This mission is being pursued vigorously by 10s of 1000s of people in government and in the SOEs themselves. Our determination remains strong. We are making steady progress and more can and will be done.

Our approach is a holistic, systemic one. For the challenges are indeed systemic and not superficial. We have zero tolerance towards mismanagement, malfeasance and the culture of greed and disregard for the wellbeing of the economy and citizens of SA. In this context, the members of the Boards and top management are bravely pursuing their mandate. We salute their efforts.

Our capacity, we admit, is limited and strained. More will be done to continuously to develop the capabilities of the people working within SOEs and Government generally.

Our actions, nonetheless, reflect the struggles against the worst in human nature. We confront the institutional deficits created by those who today profess before the Zondo Commission that they were the architects of good governance. Instead, they were the arch destroyers of the assets belonging to all South Africans.

Shortcomings, we humbly admit, we’ve had. But hindsight is the only perfect science! Of course, the armchair is a close second!

Historic Disruptions

We live in a period where the COVID-19 pandemic has ravaged the global economy, changed the political landscape, heightened social disparities, and starved us of human interaction. Climate change, the consequent energy transition, the disruption of trade and supply chains, the changes in the production geography of the globe, these are part of the new reality. In addition, • Vaccine nationalism is seeing rich countries open up their economies faster than developing countries. The fact is however that the virus does not respect borders! • Increased adoption of technologies has seen greater displacement of vulnerable people from the economy – working class, young people, and people living with disabilities. • The curtailment of travel and social interaction of people has disrupted that which makes us human – the stimulation of our senses through shared experiences. • The old business models have been disrupted and are changing.

Above all, a post-COVID world needs to develop new measures to mitigate the impact of the pandemic on working class families and communities in South Africa.

The pandemic evokes, paradoxically, tragedy and human solidarity; selfishness and generosity; economic stress and innovation; and exposes old social and economic divides and directs global focus on the workers, unemployed, precarious jobs and the wealth and income divide. This moment begs for strategic leadership towards a different, more inclusive and fairer future. So what is to be done? A recent paper argues that “…Crises and pandemics can bring society together around a common purpose, but we know from history that such critical junctures can also divide societies and propel them into chaos. Learning the right lessons and being able to galvanise society for positive change is thus one of the key tasks for governments during the ongoing pandemic.” Mazzucato, Qobo and Kattel

Economic Reconstruction and Recovery Plan (ERRP)

This “can-do spirit”, is captured by President Cyril Ramaphosa in responding to the COVID-19 crisis, when he said:

“We are determined not merely to return our economy to where it was before the coronavirus, but to forge a new economy in a new global reality.”

The ERRP is our initiative as a nation to chart a new way forward.

The implementation of the ERRP, which has placed the economy on a new trajectory, is focused on addressing priority interventions, such as accelerating structural reforms by modernising and reforming network industries and associated SOEs and lowering barriers to entry to make it easier for business to start growing their capacity.

Driving SOEs to a different future

Driving SOEs to a different future is predicated on acknowledging the damage caused by state capture, corruption and ineptitude, which is now legend. The actual impact on governance, operations, finances, institutional culture, however, is barely appreciated by many. In addition, the reputational damage of our SOEs and inadvertently the country is significant.

The inability to invest in new infrastructure, replace old equipment, pay salaries to workers, and other obligations is a consequence of the corruption and malfeasance

We have made progress towards our mission

So, what have we achieved in 2020? • Good governance codes are being embedded in SOEs. o An integrity and consequence management framework has been developed to establish clear guidelines and expectations of the Shareholder; o The pursuit of stolen money has yielded progress; o prosecution of those responsible; and o guidelines to manage conflicts of interest in the SOCs are becoming stricter • Operational efficiencies are being addressed, although not completely yet. • The financial stability of SOEs is a mixed picture, particularly in the context of a constrained fiscus.

• The goal of relieving the pressure on the fiscus remains an important focus and innovative funding solutions are being developed. • There is greater appreciation of the dynamic changes in the energy, logistics and aviation sectors which demands change in business models. • Organizational transformation initiatives to increase capability and reduce the cost structure. • Regular engagement with various industry associations to address matters in the sectors our SOE. • The Aerospace and Defence Masterplan was published in December 2020 and will be tabled in Cabinet in shortly.

There is, of course, a lot more!

Energy Sector The IRP19 has projected that renewable energy, as part of an energy mix, will contribute a total of 18.2 GW to the South Africa grid by 2030.

If the International Energy Agency’s (IEA) bold “Net Zero by 2050” Report are to be met, this will require South Africa to rapidly embrace renewable technologies.

South Africa can emerge as a leader in this sphere, providing opportunities to local industry and the development of appropriate solutions for the continent. However, the IEA Report is at pains to emphasize that “…clean energy transitions must be fair and inclusive, leaving nobody behind…” and that “the transition to net zero is for and about people…” It states that because “not every worker in the fossil fuel industry can ease into a clean energy job… governments need to promote training and devote resources to facilitating new opportunities. Citizens must be active participants in the entire process, making them feel part of the transition and not simply subject to it.”

Moreover, the IEA points out that “each country will need to design its own strategy, taking into account its specific circumstances. There is no onesize-fits-all approach to clean energy transitions.”

Eskom is implementing its just energy transition strategy and Komati power station has been prioritized as the pilot project.

ESKOM’S successes

The progress that has been achieved at Eskom has been reassuring:

• A Just Energy Transition Office was established to manage the socioeconomic impact of the transition from coal to renewable energy sources.

• Eskom’s social compact was signed in December 2020 to address its operational and financial challenges.

• The National Energy Regulator of South Africa (NERSA) has approved a 15% tariff increase that will assist with Eskom’s financial stability.

• The Medupi power station is almost complete, with the last unit ready for commissioning by July 2021.

• Kusile’s Units 2 and 3 have been brought into commercial operation in October 2020 and March 2021 respectively.

• Eskom has been recovering money that was stolen by companies doing business with it.

• The return of one of the Koeberg units to operation after many months of maintenance work.

Eskom’s restructuring

Eskom has achieved substantial progress towards functional restructuring and it is envisioned that the process will be concluded by 30 June 2021.

The progress include:

• Finalized divisionalization and launching of three divisions with Boards and Managing Directors.

• Each division will have its separate Profit & Losses account.

• A total of 9,400 employees have been relinked with power stations with 6,773 employees moved from corporate functions to divisions in readiness for legal separation.

The legal separation of the Transmission Company will be completed by 31 December 2021, while also working towards legal separation of the Distribution and Generation Companies with Eskom Holdings by 31 December 2022.

Eskom’s Financial Stabilization

In 2005, Eskom embarked on the construction of the major projects in the Build Programme with the three new power stations, namely, Medupi and Kusile Coal Stations and Ingula Pump Storage Plant. However poor procurement strategy, insufficient planning, poor project management, lack of skills, and corruption led to cost overruns and schedule overruns at Medupi and Kusile. Eskom has been correcting the latent defects at Medupi and Kusile. Money that was stolen from the projects are being recovered from the people and the companies involved.

The management of Eskom’s debt is one of the key priorities to return the entity onto a sustainable path. The entity is continuing to implement its cost reduction initiative, with a saving of R13,5 billion achieved in the 2021 financial year. Most notably was the R83 billion reduction in debt in the 2021 financial year, from R484 billion to R401 billion due to the repayment of the maturing debt and changes in the exchange rate.

Those are significant numbers chairperson.

Eskom’s consumer debt continues to escalate which currently stands at R45.1 billion – of which 78% is owed by municipalities, 17% by Soweto. The Inter-ministerial Committee headed by the Deputy President is leading the effort in resolving the municipal debt challenges. One its projects is to pilot Eskom’s Active Partnership Model at Maluti a Phofung municipality. The model entails Eskom taking over the electricity distribution function and so that proper management systems are put in place and that bulk electricity supplies are paid. The next step is to roll out the same model to the other Eskom highly-indebted municipalities.

Transnet The Logistics sector

The pandemic has changed the dynamics of trade, ports, shipping and supply chains. The capacity and efficiency of the port system in SA is vital for trade for the SA economy and the region.

In order to maintain a competitive advantage, there must be new investment in infrastructure to increase port capacity, investment in adequate equipment, an increase in productivity at the ports, and appropriate tariffs. There is a need to align the TNPA pricing methodologies to those of port regulation for competitiveness and efficiencies of the terminal operators. The institutional structure of Transnet, the establishment of TNPA as a subsidiary, and new creative partnerships with the private sector, particularly Black businesses, is imperative.

Transnet’s successes Transnet has supplied equipment to the port of Cape Town in order to increase the efficiencies at the port. In addition greater efficiencies have been introduced at the Port of Durban and Durban Port Terminal has partnered with research institutions and innovation hubs to address the weather challenges, which also contribute to congestion in the ports.

Transforming Transnet

The transformation and reconfiguration of Transnet SOC Ltd (“Transnet”), to meet the mandate outlined in South Africa’s Economic Reconstruction and Recovery Plan is underway.

Transnet’s new strategy is to drive volume growth through private sector participation by developing key strategic partnerships in its core segments: • The redesign of the Port of Durban and to reposition it as an African and Indian Ocean hub for containerised cargo. • In addition to the container and automotive growth strategies, Transnet is enhancing its export growth capability in the bulk sector focussing on mega corridors through the road to rail initiatives. • As I have earlier said, equipment is currently being transferred from the port of Durban to the port of Cape Town to support the export capacity of fruit and “cold goods”. The agricultural sector market share has grown by 24% in 2021, with a turnover of R38bn for the industry. • Engagements with property developers to acquire land parcels for truck staging for cargo to the Maydon Wharf terminals is being undertaken.

DENEL

As we, all know Denel is facing financial and operational difficulties.

The Economic Reconstruction and Recovery Plan identifies the Defense and Aerospace industry as key to economic growth, particularly in localisation and exports. The Defence and Aerospace Masterplan was finalised last year.

Denel has a confirmed order book of R11 billion but is unable to secure the necessary capital or the support of suppliers to execute the contracts.

It is highly regrettable, that Denel last paid full salaries in May 2020. The current amount owing to employees is approximately R500 million. The business has subsequently experienced a loss of critical skills to both domestic and foreign companies. The Board continues to make efforts to secure funding in order to pay salaries and implement its turnaround strategy to restructure Denel into a far more effective organisation. Denel’s core capabilities are consolidated and restructured from five divisions into Engineering and Manufacturing & Maintenance. Discussion with critical stakeholders (Department of Defence, National Treasury and the SANDF) on an optimal Denel are underway.

SAA

The aviation sector has been decimated by the pandemic with 2020 being the worst year in the history of air travel. According to IATA (the International Air Transport Association), the demand for air travel reduced by 65.9% in 2020 compared to 2019, with international air travel reducing by 75.6%.

SAA Business Rescue (BR)

The SAA business rescue process has ended on the 30th April 2021. I want to convey sincere regret and solidarity with the employees of SAA, their unions. This has been a difficult process. But we are not too far from achieving government’s objectives: a viable airline, not dependent on the fiscus, with the agility to cope with uncertain times. Our success will be measured in how efficiently and how quickly we get the job done.

The acquisition of a Strategic Equity Partner is at an advanced stage and could be concluded in the next 4-6 weeks. At the same time decisions will be made on the future of the subsidiaries.

Presidential SOE Council (PSEC)

The DPE is the secretariat to the Presidential SOE Council. I am pleased there is excellent work happening at the council, which the President will announced in respect of its outcomes in a short while.

2021/ 22 – Programme Overview

The Department has been allocated a budget of R36.3 billion in 2021/22 financial year. Of these funds, R36 billion is allocated to the SOEs in respect of the government guaranteed debts (ESKOM – R31.7 billion, SAA – R4.3 billion).

After excluding transfers to SOEs, compensation of employees (COE) is the Department’s largest cost-driver. However, this spending is expected to decrease at an average annual rate of 0.9 percent, from R185.2 million in the 2020/21 financial year to R180 million in the 2023/24 financial year.

The Department’s baseline, which is R123.5 million over the medium term and will be effected on compensation of employees (R102.3 million), and goods and services R21.2 million

Conclusion

I extend my sincere appreciation to the Chair and whip of the Portfolio and Select Committees for their sterling work and support. My thanks also to the Deputy Minister, my chief of staff, and staff in the ministry.

A special word of gratitude to the Director General Mr Tlhakudi and the band of officials who have done an extraordinary service to this portfolio and our country.

We appreciate the Boards of the SOEs for their integrity and courage in executing a difficult mandate.

The CEOs of the SOEs have offered bold leadership in a challenging environment and introduced innovative thinking.

Finally, to the most important people, the workers at the dockside, on rail lines, at the power stations, along the transmission lines, in the forests, and many other places for their contribution!

It is in these difficult and trying times that we hear Abraham Lincoln’s call to the “Better Angels of our Nature”. This is a call for all of us to dig deep into ourselves and go beyond the call of duty. As with similar defining moments in our history, we have risen to the occasion. These times, have positively defined our national identity! This is who we are – Mandela’s people!”

I submit this budget for your approval.

Source: Government of South Africa