M Sogoni: State of the Province Address

13 February 2009

Honourable Speaker and Deputy Speaker,
Members of the Provincial Legislature and Delegates of the National Council of
Provinces (NCOP),
Mr Stone Sizani, Member of Parliament (MP) and Chairperson of the African
National Congress (ANC) in the province,
Executive Mayors and mayors,
Traditional Leaders, religious leaders and representatives of civil
society,
Members of the Judiciary, Provincial Commissioner of the South African Police
Service, and Heads of the security services in the province,
Ambassadors and members of the diplomatic corps,
Vice-Chancellors of institutions of higher learning,
Heads of Departments (HoDs) and other members of the public service,
Distinguished guests, ladies and gentlemen

The presentation of this State of the province Address (SOPA) is broadcast
live on Tru FM, community radio stations, DSTV Parliamentary channel, and is
simultaneously beamed on screens in Matatiele, Komga, Kouga, Ntsika Yethu,
Elundini, Mhlontlo and KwaZakhele.

I humbly take this moment to greet all the listeners and viewers.

Madam Speaker, before we begin with the substance of this address, it is
appropriate to acknowledge and pay respect to some of our compatriots,
distinguished leaders, and heroes and heroines of the soil who have passed on
in the period between the previous State of the province Address and this day.
These include, but are not limited to:
Ncumisa Kondlo: Member of Parliamentary Legislature (MPL), Member of Executive
Committee (MEC) and MP; member of the National Executive Committee (NEC) of ANC
and of the Politburo of the South African Communist Party (SACP),
Nontuthuzelo Mabala: a veteran of the ANC Women's League and one of the brave
women who marched in 1956 against pass laws,
Tata Toto Alfred Metele: who served both as a senator in the first democratic
Senate, as well as a Member of the Provincial Legislature,
Nobantu Buka: Member of our Provincial Legislature, and
Ludumo Galada: World featherweight boxing champion, who died tragically in a
car accident recently; and there are many others, including the three health
professionals who died in a road accident and the two football players who were
struck and killed by lightening in Mhlontlo recently.

We all know that the Eastern Cape is poorer without them, and we continue to
feel indebted for their contribution to building the new South African
nation.

In contrast, Madam Speaker, I take great pleasure in extending
congratulations and warm wishes to those in our extended provincial family who
have achieved great heights in their respective fields and amongst them
are:
* The province's four cricketers: Makhaya Ntini, Mark Boucher, Wayne Parnell
and Lonwabo Tsotsobe who were part of the Proteas cricket team's historic test
and one-day international victories over the mighty Aussies on their own
soil,
* Zanele Mdodana and Nontle Gwavu: for their selection in the Netball Proteas
team,
* Bay United on playing in the Premier League of the Premier Soccer League
(PSL) this season,
* Kevin Paul who won gold at the Paralympics in Beijing and his colleague David
Ross, who won silver at the same tournament,
* The Eastern Province Women's Rugby team for becoming national champions for
the second year running,
* The National Female Farmer of the Year, Bongiwe Kali, only 27 years of age,
from Ngcetshe Village in Mnquma; and the National Emerging Farmer of the Year,
Merlon de Jager from Aberdeen in Camdeboo, and
* Madam Speaker, on behalf the government and people of the Eastern Cape, I
wish Ali Funeka well as he goes toe-to-toe in his International Boxing
Federation (IBF) title fight in the United States (US) tomorrow.

These, and many others, are just a semblance of abundant talent in the
Eastern Cape, much of which we do little to appreciate.

Madam Speaker, it is my honour, as Premier of the Eastern Cape, to present
to you and the people of our province this State of the province Address, the
last in this third term of government.

Whilst this occasion is dictated to by tradition, I would want to underscore
the significance we attach to it as both the provincial government and the ANC,
as the ruling party. This occasion draws interest and participation across all
sectors of society, and thereby cements the broad partnership that has become
the cornerstone of our inclusive policy approach. Further representing our
commitment to transparency and public accountability, this occasion presents
yet another opportunity to publicly articulate our own perspective of where we
are as a province, whilst detailing the progress we have made and where we are
heading. In this regard, I will attempt, in some level of detail, to review the
work of government during this term, and in preparing to pass the baton to the
new administration after the forthcoming elections, I will reflect not only on
the achievements in the government's relentless efforts to create a better life
for all our people but also on the challenges that remain. Later, I will refer
to some of the opportunities that lie ahead.

Madam speaker, it is important to give a broad paint-brush picture of the
development context in which we operate.

It is far too easy in the current political and socio-economic climate to
forget where we have come from. Only 15 years ago, South Africa was not only a
divided and conflict-ridden society, but also one with an economy that was
stagnant after more than 10 years of negative growth. The social effects of
economic mismanagement and institutionalised racial discrimination were
glaring. More than 12 million people lacked access to water; more than 23
million of our people had no electricity; and more than two million children
never had the opportunity to attend school. More than 25 percent of the
population lived on less than half of the poverty line income. It goes without
saying that the Eastern Cape, with its bigger share of the marginalised
Bantustan component, had a disproportionately high share of these negative
socio-economic indicators.

The government's 15 Year Review Report outlines in detail the progress made
in the efforts to restore dignity, human and socio-economic rights to millions
of South Africans who were disenfranchised under apartheid colonialism. This
report informs us that over the past 15 years, hundreds of thousands of the
poorest households have been provided with a range of social services including
social grants, housing, electrification, safety, water, sanitation, health and
education services.

It also acknowledges reduction in the levels of poverty and unemployment,
and that much has been achieved with respect to efforts to stabilise the
macro-economic environment, partly as a response to globalisation but also to
ensure a sustained economic growth rate higher than four percent.

Informed by this report, we are concerned that levels of inequality have
increased and about the fact that access to quality social services still
correlates too strongly with race, class, gender and spatial factors. It is
also evident from the report that, despite the significant gains of the past 15
years, as government, we have not yet achieved the acceptable pace and quality
of service delivery.

At the provincial level, many of the structural features of the apartheid
economy are still evident, including the monopolistic structure of capital, a
vulnerable industrial economy dominated by the automotive sector, massive
service and infrastructure backlogs in the former Bantustans, and an
under-developed agricultural sector.

Having outlined all of these challenges, we need to be mindful that we have
not only built a sustainable and resilient political and economic system of
governance, but also ensured that South Africa and the Eastern Cape remains a
stable society where all citizens can realise their potential. We have built
and continue to consolidate a society founded on solid social partnerships
between government, business, labour, civil society, churches, academic
institutions, among others. This is based on an understanding that our success,
moving forward, depends on us all working together.

Madam Speaker, I also take this opportunity to acknowledge the interest
shown by the people of the Eastern Cape in the build up to the fourth general
elections to be held on 22 April 2009, as evident in the level of voter
registration. 2,9 Million of the provinces' population have registered as
voters, and this accounts for close to half of the total provincial population.
This interest shown by the voting population in our province and the expected
high voter turn-out will contribute to the deepening of democracy, and ensure
legitimacy of a government based on the will of the people.

But we must remain vigilant and never allow this interest and desire for
political fortunes to lead to violent incidents in the run-up to the elections.
In this regard, I call upon members and supporters of all political parties in
the province to exercise political tolerance, and that leaders should
effectively use the party liaison structures of the Independent Electoral
Commission (IEC) to resolve conflict, thus making sure that these elections are
free of incidents of violence and intimidation. I take this opportunity to wish
the IEC in our province well in the mammoth task of managing the forthcoming
elections.

Madam Speaker, let me preface my analysis and presentation of our
achievements with a summary of the mandate we carry as government. At the
beginning of this third term of government in 2004, our shared destiny was set
out in the manifesto of the ruling party, and this formed the basis for the
mandate given to government to achieve the objectives of reducing unemployment,
poverty and crime; providing the skills required by our economy; ensuring that
all South Africans enjoy the full dignity of freedom including compassionate
government service and a better national health profile.

These objectives were carried through in very specific targets in the
Provincial Growth and Development Plan (the PGDP), the government's
over-arching blueprint providing a 10-year vision for growth and development.
It is against this programme that I today present to this House and the people
of our province the performance of provincial government during this term.

Madam Speaker, looking at our economic interventions, the government's
efforts over the past five years to grow the economy and create sustainable
work opportunities for our people were based on the six-fold strategy.

Firstly, the building of world-class logistics and transport infrastructure
such as the Coega and East London Industrial Development Zones,

Secondly, the consolidation of our manufacturing strengths around the
automotive sector, while at the same time actively diversifying into new niche
sectors,

Thirdly, the deepening and sharing of the impact of economic growth through
Broad-Based Black Economic Empowerment (BBBEE) and, where possible, leveraging
off state procurement,

Fourthly, addressing our skills deficit through a targeted skills plan, and
the establishment of a provincial council for the Joint Initiative on Priority
Skills Acquisition (JIPSA), to prioritise and co-ordinate skills development
interventions in the province,

Fifthly, the establishment and beneficiation of the Mzimvubu Development
Zone in the eastern part of the province, including the Ugie-Maclear forestry
cluster, with a particular focus on the former Transkei, and

Sixthly, addressing red-tape bottlenecks that constrain investment.

The trends in the Gross Domestic Product by Region (GDP-R) figures over the
past five years suggest that the province has experienced growth in line with
the national average of above four percent per annum. The automotive sector, in
particular, performed very well, supported by the Government's Motor Industry
Development Programme. During this term of government, the automotive sector in
the province attracted investment in excess of R3 billion.

The current global financial crisis has triggered a sustained and negative
impact on the buoyant growth of the real economy. The automotive sector is
particularly affected, and will require innovative partnerships between the
original equipment manufacturers, component suppliers, government and labour to
mitigate the impacts. In this regard, I am pleased to announce that provincial
government has decided to allocate additional resources to the Coega
Development Corporation for the further development of the Automotive Supplier
Park.

As will further be confirmed in the budget allocations, the government's
counter-cyclical fiscal strategy will see significant public spending on
infrastructure and social services over the next three years. This will shore
up the economy in the face of the global economic crisis.

The Provincial Industrial Strategy identifies concrete measures to diversify
out of the dependence on the automotive sector into other priority sectors that
create sustainable employment opportunities, including tourism,
agro-processing, and forestry and timber. The strategy promotes co-operatives
and broad-based empowerment, and various efforts that affirm beneficiation.

In addition, stronger alignment with the National Industrial Policy
Framework as well as the Local Economic Development (LED) plans of local
government is critical to optimise the impact of our industrial strategy. Also
important will be to upgrade the capacities of our economic services
departments and entities in line with the objectives of a developmental
state.

At the core of government's approach to stimulating the economy are the
continued efforts to link investment in infrastructure with economic
development. It is in this context that we must view provincial government's
multi-billion rand programme of upgrading provincial roads during this term.
Amongst others, key road infrastructure programmes that have been completed
include the Mount Fletcher-Maclear road, at a cost of R411 million; the
Dutywa-Engcobo road at a cost of R378 million; the road from the N2 to Kei
Mouth at R221 million; the Graaff-Reinet-Jansenville Road at a cost of R26
million; the Ugie-Langeni link road, costing R500 million; the road from King
William's Town to Alice, costing R200 million; the road from Sterkspruit to
Tele Bridge, at a cost of R132 million; the Cala-Lady Frere road, costing R381
million; and the Mthatha to Qokolweni road, costing R138 million.

Social considerations have also informed our infrastructure programme. In
this regard, roads have also been built to improve access to hospitals and
clinics, such as Holy Cross and Sulenkama health facilities.

Understanding the direct link between isolation and poverty, provincial
government is continuing to provide access to rural communities who have been
hampered in their daily activities, by upgrading previously impassable roads.
Over the past two years, R400 million has been spent on this programme.

However, the challenges of poor road infrastructure in our province remain
vast and impact negatively on local communities as well as potential
investments. Provincial government has a 10-year plan to upgrade 80 percent of
the provincial road network from gravel to surfaced or tarred roads. With
additional support from national government, the province will be able to meet
this target sooner.

Major infrastructure developments such as the Industrial Development Zone's
(IDZs) and roads have resulted in major domestic and foreign investments in the
province. The two provincial Industrial Development Zones, initiated and
supported by government over the past two terms, have demonstrated their
capacity to attract investment as evident in the investor commitments of tens
of billions of rands.

The Steinhoff investment in a R1,5 billion pressed wood facility in the
north-eastern forests of the province was facilitated by government's spend of
R148 million on infrastructure in and around Ugie, apart from the construction
of the Ugie-Langeni road referred to earlier. The refurbishment of Kei Rail has
been completed at a cost of R93 million, resulting in increased mobility and
accessibility for rural people at affordable rates. On the strength of this
development, government is looking at further possibilities of freight links
for growth sectors such as timber.

Provincial government, working with Buffalo City, business and other
relevant partners will continue lobbying both national government and the
National Ports Authority to invest in the expansion of the East London port to
unlock throughput bottlenecks and widen opportunities for trade.

Madam Speaker, the unemployment rate in our province fell consistently
during the past term (down from 27 percent to 23 percent). However these gains
are beginning to be reversed by the current global financial crisis, with
unemployment rising over the past two quarters.

The government's Expanded Public Works Programme (EPWP) has played a
critical role in creating employment opportunities, especially for youth and
women. The Eastern Cape EPWP programme has consistently ranked second in the
country over the period 2004 to 2008 despite having a very small operational
budget. During this period, over 212 000 employment opportunities were created
by public bodies in the province, exceeding the target of 176 000, and more
than 50 000 people have been trained. Government is committed to replicating
these successes through the Phase 2 roll-out of the EPWP, which is expected to
improve on the programme through the creation of more sustainable jobs.

Provincial government, with a greater degree of success, uses state
procurement to build the co-operative and small, medium and micro enterprise
(SMME) sectors. As an example, in this financial year alone, government,
through Eastern Cape Development Corporation (ECDC), has so far disbursed R95
million in loans to the emerging contractor programme and another R114 million
advanced as loans to SMMEs. R50 million worth of the SMME loans were in support
of the Department of Education's school nutrition and scholar transport
programmes. Owing to the success of this programme, a further R100 million has
been set aside for loans to SMMEs supporting school nutrition in the next
financial year.

We are also pleased to report that provincial government has approved the
Provincial Co-operative Strategy that envisages the establishment of a
co-operative development fund, and this will be implemented in the next
financial year.

With regards to rural development and agrarian transformation, as one of the
strategic priorities of provincial government, government provided support to
the commercial farming sector by providing infrastructure, and in partnership
with this sector, resources were provided to enable ownership by worker groups.
Living examples of this are the pineapple farming in Peddie; the chicory
farming in Alexandria; the citrus on the banks of the Kat River and at Addo;
the fruit farmers in Langkloof; and the paprika farmers in Keiskammahoek.

Government has also initiated an agri-park at Duff Mission in Dutywa, which
will comprise a processing facility, cold storage facilities and irrigation
system. The unit is one of our outstanding efforts to ensure food security.

Madam Speaker, to date, our boldest rural transformation initiative is the
establishment of the Mzimvubu Development Zone, where the Accelerated and
Shared Growth Initiative for South Africa (ASGISA) (Eastern Cape) is
operational since the beginning of this financial year with the following
programmes:
* 6 000 hectares, targeting mainly areas that had not been cultivated for more
than 20 years, have been planted mainly with maize at Ongeluksnek in Matatiele,
Tsilitwa, Etwa, Sulenkama, Gqwesa, all in Qumbu, and at Theko, Zingqayi,
Thanga, all in Butterworth.
* In partnership with the National Development Agency, Chris Hani District
Municipality and the national Department of Agriculture (DoA), work is being
finalised to purchase 6 000 large live stock units as part of the livestock
rural commercialisation programme. This is in support of the Land
Redistribution for Agriculture Development (LRAD) farms co-operatives covering
74 farms, and these include Tsomo Valley, Ithemba Farmers, Umthombo and Cicira
Ntungelo Co-operatives.
* The Department of Water Affairs and Forestry (DWAF) is currently conducting a
feasibility study at a cost of R9 million on the development of the Mzimvubu
water resources.

In 2008, provincial government convened the Provincial Land Summit in
Mthatha to foster partnerships and achieve stakeholder mobilisation in an
attempt to resolve the complex issues of land reform. Following this summit,
provincial Cabinet has institutionalised the Eastern Cape Land Working Group
(ECLWG) to facilitate the implementation and monitoring of the land summit
resolutions, amongst which is the facilitation of the speedy resolution of
outstanding land claims and the betterment redress programme; mediating land
use patterns; strengthening the capability of communities to ensure effective
utilisation of all fallow land; and facilitating improved government support to
farmers.

Madam Speaker, I will now sketch a brief picture on progress made in the
delivery of social services. The provincial government's programme to provide
services to the 6,5 million people of the Eastern Cape has seen a figure of
approximately R120 billion being spent during this term. 80 Percent of this
budget was allocated to social services, including health, education, housing
provision as well as social safety nets. Indeed, this pattern of fiscal
allocation is in line with the intentions of government policy, to widen access
to social services and migrate our population from grinding poverty. However,
there is a need to continue to make efforts to strike the correct balance
between expenditure on economic development and the social services budget.

The effect of our social spending programme, Madam Speaker, is that the
province has eradicated 98 percent of the buckets in formal settlements. We are
acutely aware that the remaining two percent, constituting 1 400 buckets in
Tarkastad and Indwe, is unacceptable, and in this regard we are working with
DWAF and the district municipality to ensure that the remaining buckets are
eradicated soon.

We have ensured that the number of households with access to piped water
rose to 71 percent. Notwithstanding this progress, we are concerned about bulk
water and sanitation infrastructure that is in a state of decay, particularly
in the small towns of the former homelands. In the recent period, we have
experienced incidences of sewage spillage and evidence of water borne diseases
in areas such as Ukhahlamba. Provincial government is working closely with DWAF
to finalise the plan and costing of resources needed for intervention in these
areas.

Madam Speaker, housing delivery remains one of the most vexing challenges in
the province. In the past few years the province has experienced a number of
limitations with respect to project management, governance, the quality of
housing units, as well as under-spending on the housing conditional grant. In
response to these challenges, the provincial government established a
stand-alone Department of Housing (DoH) to fast-track the delivery of quality
houses for the people of the province. This move, coupled with the accelerated
housing delivery plan, resulted in the delivery of 10 136 houses between March
and December 2008. An additional 10 000 units are nearing completion, making us
confident that we will surpass our target of 15 000 units by the end of March
2009.

Government's housing delivery strategy that is being implemented in
collaboration with municipalities has resulted in more effective administration
of trust accounts. It has only provided solutions to the issues that have
previously delayed the completion of housing projects, but also improved the
management of contractors in pursuit of a better quality of units that our
citizens can be proud of. In this regard we wish to acknowledge the partnership
with the National Business Initiative which is assisting the government in
providing professional expertise in the areas of project management and quality
assurance of housing units.

Madam Speaker, government has succeeded in massively widening access to
social grants in the province. Whilst the number of grant beneficiaries was
almost 1,3 million in 2004 and increased to 2,3 million by 2008, largely due to
the increase to 14 years in the qualifying age for Child Support Grants (CSG)
and the lowering of the pension age for men to 63. We are pleased to note that
from the 1 April 2009, men at the age of 60 and children at the age of 15 will
also qualify.

While the social security nets have impacted positively on abject poverty,
we are aware that this is not a sustainable measure. In the period ahead,
government will work to intensify the implementation of the Provincial
Anti-Poverty strategy and related interventions including massive food and
eco-tourism, all of which are aimed at creating opportunities for active
economic participation to systematically reduce over-dependence on social
grants.

In line with the commitments made in 2004, provincial government has moved
to widen access to education. As a result, nine out of 10 children of primary
school-going age are attending school in our province. This is due to a range
of measures put in place by government, including providing safe and reliable
scholar transport for children living more than five kilometres from schools
and increasing the number of no-fee schools. To further create an environment
conducive for effective learning and teaching, the Department of Education
(DoE) now feeds more than 1,3 million learners every school day with cooked
meals provided in more than 1 000 schools, including 82 farm schools.

Government has also finally improved its performance with regard to the
provision of Learner and Teacher Support Materials. This has been achieved
through improved relationships with publishers, a dedicated project management
office, and better management of the supplier value chain. As a result, in
preparation for the 2009 school year, stationery was delivered to all schools
by the end of October 2008, and textbooks were provided to 95 percent of
schools by the time schools opened in January this year. There has been slow
progress in the eradication of mud schools. However, I am pleased to report
that in the four months period between October 2008 and this day, this
programme has delivered 28 schools to replace mud-structures that have been in
existence for years, the highest number at any other corresponding period.

Madam Speaker, the provincial performance with regard to the 2008 grade 12
results is one of the stark reminders that we need to work harder to improve
the quality of education. Government recognises that our efforts should be
directed at addressing the functionality of schools, including promoting the
culture of teaching and learning, and improving infrastructure, as part of the
learner attainment improvement strategy. In addition, early childhood
development programmes implemented by government constitute a critical
intervention in laying the foundation from an early age of human development.
The mobilisation of all stakeholders in support of this quest also requires our
immediate and focused attention.

Provincial government has further solicited the support, and in principle
got the approval, of the National Department of Education to re-enforce the
work started in the accelerated service delivery plan of the provincial
department with an emphasis on corporate services, financial management
functions.

Madam Speaker, government has worked hard to improve the health profile of
the people of the province, and yet huge health care needs still require
attention and the expectations of our people are not unreasonable.

Significant strides have been made in addressing the infrastructural needs
of both hospitals and clinics. Two new hospitals, the Madzikane kaZulu and Port
Alfred hospitals, and 49 new clinics have been built, alongside six new
community health centres at Mount Coke, Dimbaza, Dutywa, Ngcobo, Sada,
Nontyatyambo. The Public Private Partnership (PPP) model applied in the
building of the Port Alfred Hospital is a shining example of what government
and the private sector can do together. A further 397 hospitals and clinics
have been upgraded or refurbished during the term.

Government is deeply concerned at the increasing prevalence of communicable
diseases such as HIV and AIDS and tuberculosis (TB). For example the incidence
of TB increased by 30,4 percent between 2004 and 2007. While TB is curable,
some of the complicating factors in the fight against this disease are its
relationship with HIV and AIDS, and poor compliance with the treatment regime.
We are, however, encouraged by the notable progress in OR Tambo district which
has achieved a 73 percent cure rate against the provincial target of 60
percent, and we urge other districts to strive to achieve similar impacts. As
part of government's response to the increasing incidence of both extreme and
multi-drug resistant TB, we have made provision for 80 additional multi drug
resistant tuberculosis (MDR-TB) beds at Majorie Parish hospital.

With respect to HIV and AIDS, government has improved access to
anti-retroviral (ARV) therapy care and made dual therapy available in
healthcare facilities as part of the government's programme of prevention of
mother to child transmission of HIV. To date more than 66 000 people are on
anti-retroviral treatment at 74 accredited facilities in our province, making
us confident that we will surpass our target of 70 000 by the end of March
2009.

We concede, however, that the fight against HIV and AIDS as well as drug
resistant TB is yet to be won. The magnitude of the problem dictates that we
need to sustain our partnership with all stakeholders, including traditional
leaders and faith-based organisations. Equally, family members have a critical
role to play in this regard.

Provincial government has prioritised better drug supply management. In this
regard, we will soon finalise the public-private-partnership to manage the
distribution of pharmaceuticals from depots to health service sites. We are
aware of the shortage of pharmacists, a problem further exacerbated by the
preference of these professionals to join the private sector. The province is
investing significant resources to train more pharmacists.

The shortage of doctors and nurses to serve in public hospitals and clinics
is also of major concern. Government is actively working to expand the skills
pool by increasing the intake of students at nursing colleges, and training of
more doctors.

Expenditure on health professional training at universities has more than
doubled in 2008, increasing from R45 million to R96 million. This is funding
600 medical doctors studying at universities across the country, with more than
300 having graduated between 2006 and 2008. Government is also supporting more
than 200 nursing students at universities, with more than 3 400 students
enrolled at Lilitha nursing college in 2008 and a further 1 600 expected for
the 2009 intake. I also wish to acknowledge the contribution of the Tunisian
and Cuban doctors who are working in our province as a result of South Africa's
partnership with these countries.

Madam Speaker, it is a matter of concern to government that the incidents of
criminal activity have negatively affected our communities in recent times. To
this end I am reminded of the brutal attacks on women in Mbizana; the senseless
killings in Butterworth as well as the case of the so-called Kei Ripper. It is
a matter of some relief that suspects have been arrested and charged.

Community mobilisation remains at the centre of the provincial government's
fight against crime. The backbone of this approach is the establishment of
vibrant and functional Community Police Forums (CPFs). A particular area of
success has been in the area of victim empowerment. This programme has
responded to the abuse of women and children, and has established mobile victim
support centres at 25 police stations and four outreach centres throughout the
province. This programme has also trained more than 1 000 community members in
victim support and empowerment and close to 700 police members in handling
domestic violence incidents.

Within the ambit of our Safer Schools Campaign, provincial government is
working in partnership with the South African Police Service (SAPS) to ensure
the safety of our learners and teachers, protection of state property and
campaigns against substance abuse. However, we acknowledge the slow progress in
the implementation of the school fencing programme and this programme will
require greater attention in the coming financial year.

We believe that the integrated approach within the newly established
Justice, Crime Prevention and Security Cluster (JCPSC) of provincial government
will go a long way to ensuring agility and responsiveness in dealing with
social crimes in particular.

Madam Speaker, there are 482 days till kick-off in the 2010 FIFA World Cup.
We are excited at the progress in the development of the stadia in Nelson
Mandela Bay, Buffalo City and Mthatha. Provincial government has so far
invested R50 million in the refurbishment of sports facilities in Buffalo City,
and R100 million in the construction of the stadium in Mthatha. The Nelson
Mandela Bay stadium is set to be completed a year before the 2010 kick-off,
while the next financial year's budget will confirm further allocations for
Phase 2 of the Mthatha stadium. These facilities are not only aimed at
supporting South Africa's successful hosting of the 2010 FIFA World Cup, but
they will also provide a lasting legacy for generations to come well beyond
2010.

Of particular importance to us is to ensure that the Eastern Cape multiplies
the potential economic opportunities presented by the world cup through the
development of cultural and craft industries and enhancing the heritage of the
province for the promotion of cultural tourism. We are also expanding
hospitality services, to ensure sufficient numbers of beds to accommodate
tourists who will visit the province. To this end more than 1 200 people have
been trained in the hospitality sector.

Current estimates indicate that 29 000 beds are needed in the host region
within one and a half hours travelling time from the Nelson Mandela Bay
stadium. More than half of these beds are already available. With new hotels
being built by the private sector, the Eastern Cape Tourism Board-facilitated
grading of non-hotel establishments and the metro's home stay initiative,
government is confident that there will be more than sufficient accommodation
in 2010.

Delivery of a modern public transport system is also part of the 2010 FIFA
World Cup legacy we are intending to create. At its executive council (EXCO)
meeting this week, provincial government noted and expressed its deep concern
at the unrest in the Nelson Mandela Metro resulting from the taxi industry's
protest action over the Bus Rapid Transit System. Government is particularly
concerned at the violent nature of the unrest, including the destruction of
property, as well as the suffering experienced by innocent commuters.
Provincial cabinet took a firm decision not to watch from the sidelines
anymore, but further that our involvement will be in the interests, and
defence, of the rights of commuters. We will not abdicate our responsibility to
uphold the law and maintain order! We will not compromise the rights of
citizens to safe and affordable transport!

Madam Speaker, I will now focus on the state of governance and public
administration. In this sector, the focus of government during this term has
been on improving the organisational capacity and effectiveness of the state.
This has entailed addressing skills and capacity deficits within the public
sector and the broader economy and creating a service oriented public service.
Also key has been the advancement of integrated planning, monitoring and
evaluation, ensuring financial management and fiscal reforms.

Integrated governance and the macro-organisation of the state, including
support to municipalities through the Five-Year Strategic Agenda for Local
Government has been the hallmark of our intervention. In this regard, municipal
support interventions by Provincial Treasury and the Department of Local
Government and Traditional Affairs are beginning to show positive results. In
this regard, I am proud to mention that our Provincial Department of Local
Government and Traditional Affairs recently received recognition at the Vuna
Awards in the area of municipal support.

Notwithstanding these successes, provincial government is concerned about
evidence of weak governance which has made it necessary for us to consider
potentially drastic interventions in some municipalities. The incidences of
poor governance and instability in such municipalities as King Sabata
Dalindyebo, Mnquma, Mbhashe, Amahlathi, Buffalo City, Sakhisizwe and Koukamma
are a case in point.

Madam Speaker, the engine which drives the work of government is the public
service, and currently this comprises just over 137 000 public servants in the
province, including educators. Over the reporting period, government
intensified the recruitment efforts and filled 72 percent of posts of the total
establishment, an improvement on the 58 percent reported in the second term.
The gender balance in the senior management services has been improved
progressively from 24 percent to 33 percent. However this improvement still
falls short of the 50 percent target envisaged in the 2004 Manifesto of the
ruling party. Similarly, more work still needs to be done to improve the
numbers of employees with disabilities from the current 0,2 percent to at least
two percent.

In the area of skills development, government trained more than 46 000
employees across a range of critical competencies, including public financial
and supply chain management, this done in the belief that the return on this
investment will be realised in the improvement of service delivery.

One of the most innovative interventions during this term has been the
adoption and implementation of the Unemployed Graduates Policy across the
administration. In this programme 950 unemployed graduates participated in
internships across the provincial administration, excluding those in public
entities.

It is pleasing to note that the introduction of this young cadre of public
sector professionals has enabled our province to make a meaningful contribution
to introducing new talent into the administration while affording the young
graduates an opportunity of first-time employment experience.

However, further improvement in the administration of this policy, as well
as possible partnership with the private sector, is a matter that will require
the attention of Government moving forward.

Since 2006, the provincial administration provided learnerships for
unemployed youth in areas identified as scarce and critical skills. To date,
almost 3 000 learnerships have been awarded, and these include those identified
through local government, the IDZs and other strategic partners.

Further, in the area of skills provision and development for the benefit of
the economy as a whole, government expended R272 million on bursaries for 13
000 students. The provincial JIPSA initiative has seen more than 1 000 youth
participating in learnerships, with a further 200 graduates placed in
internship programmes in the manufacturing, tourism, agriculture, and
infrastructure development sectors.

Government's investment in the province's Further Education and Training
(FET) Colleges is an important pillar of skills development in our economy. In
the recent period, more work has been done to align the course offerings of
these colleges with the priority skills identified within the Provincial
Industrial Development Strategy to drive the provincial economy.

Madam Speaker, one of the achievements worth mentioning is the stability we
have achieved in the state of provincial finances.

We started this term with an over expenditure of R623 million and a bank
overdraft of R744 million. This was further exacerbated by the fact that the
main budget appropriation for 2004/05 included a budget deficit of R563
million. The prudent financial management and austerity measures which were
implemented in the first two years of this term saw a steady improvement in the
finances and better co-operation amongst departments and treasury.

Since 2005 the province has maintained positive cash balances allowing
expenditure to increase from R21 billion in the 2005/06 financial year to R31
billion in the 2007/08 financial year. Indications are that this positive
outlook continues in the next Medium Term Expenditure Framework (MTEF) cycle,
with expenditure expected to have doubled in the next three years. While
expenditure has been very much close to budget for most of the time, some
lessons were learnt from the 2007/08 financial year, with significant under
spending resulting in more than R500 million being suspended from our
budget.

It is pleasing, Madame Speaker, to note that in the current financial year,
expenditure has significantly improved, even from the most challenged sectors
like housing. While the expenditure continues to improve, we as government,
must double our efforts to put systems in place to measure the impact of the
expenditure to service delivery and assess whether we are closer to achieving
our development goals.

Madam Speaker, I am pleased to report the improvements in the audit outcomes
of provincial departments in the last financial year, with five departments
receiving unqualified audit opinion – the highest number since 1994, and
clearly reflecting a significant improvement over the last four years since the
2004/05 financial year. It is encouraging to note in the recent municipal audit
outcomes that similar trends are beginning to show in the local government
sphere.

The audit intervention plan developed in 2007 has successfully addressed
some of the management weaknesses with regard to assets; human resources;
supply chain; financial management; and the control environment. However,
government is concerned at the perennial failure of some of the big
departments, notably health and education, to achieve unqualified audits.

The Anti-corruption Unit was established in the Office of the Premier in
2006, in a concerted effort to fight corruption and build an ethical public
service. The unit co-ordinates all anti-corruption work and security management
initiatives in the provincial government. It is initiative aimed at promoting
the integrity of, and restore confidence in, the public service in particular
and in the government's fight against crime and corruption in general.

Most of the cases handled by the unit flow from calls received through the
national anti-corruption hotline. To date, 411 incidences of corruption in
provincial government are under investigation, and a substantial number of
these have been referred to law enforcement agencies. In addition, the unit has
trained 312 officials across government as ethics champions.

For these efforts, the Provincial Anti-corruption Unit has been recognised
as an excellent model by the Ethics Institute of South Africa.

Madam Speaker, in the quest to achieve service delivery excellence, the
Eastern Cape Government has initiated various interventions to improve the
effectiveness of the public service. These include the Balasela Programme which
has proved to be an effective tool in progressively achieving service
excellence by identifying and addressing, through service delivery improvement
plans, the internal efficiency issues that have an impact on service delivery.
Through this process government has identified and recognised best practice
examples in the public service.

Madam Speaker, we continue as government to improve our engagements with the
citizens as part of our efforts to deepen democracy and participatory
governance. These initiatives include the Presidential and Ministerial
Izimbizo, Executive Council outreach programmes and the Legislature's "Taking
Parliament to the people," and they provide opportunities for unmediated
interaction between the citizens and their government. However, there is a need
to pay more attention to addressing the issues raised in a systematic and
co-ordinated manner and improve feedback mechanisms to communities.

In addition, the Thusong Services Centres programme was intensified in the
efforts to improve access to government information and services. To date, 13
Thusong Service Centres are operational and a further three are due to be
launched before the end of March 2009 at Nophoyi in Alfred Nzo; in Burgersdorp
in Ukhahlamba; and at Esilindini in Chris Hani. We believe that we are within
reach of the national target of at least one Thusong Service Centre in each
local municipality by 2014.

Madam Speaker, we have also greatly intensified our efforts to enhance
inter-government relations aimed at fostering co-operative governance as
prescribed by Chapter 3 of the Constitution. The province has made progress in
setting up the structures provided for in the Inter-Governmental Relations
Framework Act of 2005. Although meetings take place fairly regularly,
government is still challenged with the establishment and management of
effective inter-governmental relations. This is evident in the disjuncture in
planning between provincial and local government, particularly the inconsistent
participation by provincial departments in the crafting of municipal integrated
development plans. This phenomenon also manifests itself in the failure by
provincial departments to timeously pay monies owed to municipalities, as well
as in the management of relations with respect to the assigned powers and
functions such as primary health care and water across the spheres of
government.

To attend to these and other challenges, an Intergovernmental Relations
(IGR) Summit will be held later this year.

Madam Speaker, in the course of this term, and particularly last year, the
ANC exercising its leadership role of government and society, was the first to
acknowledge that, notwithstanding the achievements I have referred to, major
challenges still remain.

It became clear that there was a need for intervention to speed up service
delivery and address inefficiencies particularly in health, education, housing
and local government. The Service Delivery Acceleration Plan was introduced,
and without appearing boastful, Madam Speaker, I wish to report that the main
achievement of this intervention has been to bring about stability in
government and refocusing leadership in government on developing plans to
implement government programmes faster. This work also afforded us, as
government, an opportunity to actively engage with the stakeholders of the
province, thereby firmly embedding government amongst the people.

This plan called for the streamlining of service delivery focus areas,
prioritising those that have the greatest impact in improving the lives of the
people of the province. The key thrust of our approach was project-based
planning and reporting; improved resource allocation and quality of spend;
exploring alternative and innovative approaches to service delivery and
improved accountability and rigorous monitoring.

Already, through this short-term intervention, we have witnessed the timeous
delivery of stationery and school textbooks for the first time in a number of
years; widened access to the school nutrition programme; improved the footprint
of the no-fee school programme; begun to improve the functionality of health
facilities with shortened waiting times due to the piloting of down-referral
system and queue marshalling, introduction of 24-hour security and allocating
doctors in out-patient and casualty departments; upscaled access to HIV and
AIDS, with more facilities accredited; improved availability of services,
essential equipment and accommodation to TB patients at Marjorie Parish
hospital; begun to improve our systems for drug supply and stock management;
improved the pace of delivery of quality homes.

As alluded to earlier, our work on the Provincial Service Delivery
Acceleration Plan has delivered positive results, showed us potential benefits
of greater co-ordination efforts of government departments by the Office of the
Premier and improving levels of collaboration and co-operation between
provincial and local government.

This work has also brought to the fore some of the weaknesses in the
functionality of government departments, and has in particular exposed
planning, co-ordination, monitoring and reporting failures.

This further affirms our intentions of strengthening the OTP as the centre
of government.

In furtherance of this work, the Service Delivery Acceleration Plan approach
will be mainstreamed and institutionalised across the provincial
administration. This will see identification of key priority areas in the
annual performance plans of departments and subjecting those to this project
management approach.

Madam Speaker, in keeping with our earlier undertaking that we intended to
use the period of this intervention to prepare for the next term of government,
I am pleased to report work has started in strengthening the capacity for
planning, co-ordination, monitoring and evaluation of the work of government.
This includes the institutionalisation of better management, by the Office of
the Premier, of the accountability of heads of departments in line with the
Performance Management and Development System of the public service. To this
end, we will work to finalise the re-engineering work of the Office of the
Premier by March 2009.

Informed by the slow progress in our work to transform traditional
leadership and institutions to expand representivity and improve functionality,
government will pay particular attention to the renovation programme for
traditional council offices as well as the finalisation of the election of
traditional councils immediately after the forthcoming national and provincial
elections. The new building for the Provincial House of Traditional Leaders
will be completed and opened soon.

It is our belief, Madam Speaker, that in the medium-to-long term, the
Eastern Cape remains well positioned to attract local and foreign investment
into the region, and we are confident that we will achieve above four percent
growth by 2011 given our logistics capabilities, our low operating costs, and
competitive advantages in the automotive, fabricated metal components,
agriculture, leather processing, chemicals and tourism sectors. We believe that
these programmes will help to crystallise our response to the impact of the
global economic crisis, and that working with trade unions and industry, we can
mitigate its impact on the provincial economy.

As alluded to earlier, government will continue to invest in public
infrastructure such as the eradication of mud schools, the provision of decent
sanitation and the construction of roads and stadia, including Phase 2 of the
stadium at Mthatha which will be part of the 2010 FIFA World Cup legacy.

The worsening drought across many parts of our province, mostly in the areas
of Chris Hani, Cacadu and Ukhahlamba, is impacting negatively on our efforts to
improve food security, address water quality and supply issues, placing many of
our people, particularly farmers, under unbearable hardship. This matter is
receiving our urgent attention, including reprioritising the Comprehensive
Agricultural Support Programme (CASP) budget to allow for drilling of
bore-holes in areas of need.

The Office of the Premier and relevant stakeholders will work to finalise
the Provincial Rural Development Strategy based on the strategic framework
recently approved by the Provincial Cabinet Lekgotla.

More attention will also be paid to the finalisation and implementation of
the Provincial Industrial Development Strategy action plans. Linked to this
will be a sustained public investment programme to "crowd in" private
investment into underdeveloped areas; the accelerated transfer of productive
assets, especially land, to the poor; the massification of skills development,
especially technical and artisan training for the unemployed; the
prioritisation and provision of an efficient and affordable public transport
system; the development of support packages to grow targeted sectors.

Similarly, particular focus will be on the implementation of the
co-operatives strategy and establishment of the Co-operatives Institute as
specific measures to build a competitive and sustainable co-operatives
movement.

You will note, Madam Speaker, that these interventions will be made against
the backdrop of the global economic crisis and therefore must in turn
contribute towards building the resilience of our economy. Once again, the
collaboration of the key social partners – government, business and labour –
will be the cornerstone of our strategic response.

With regard to the social sector, government will continue with and
accelerate the work conceptualised and packaged through the Service Delivery
Acceleration Plan in respect of education, health, and housing, and this will
include embedding the culture of teaching and learning, continuing the roll-out
of the anti-poverty campaign, improving the footprint of comprehensive primary
health care and accelerating the delivery of quality houses. Provincial Cabinet
has taken a decision to allocate and ring-fence additional resources to tackle
the accumulated payment backlogs (accruals) in the Department of Health.

In conclusion, Madam Speaker, an objective assessment of the government's 15
year and five year reports will without doubt reveal that a lot has been
achieved, and yet more still needs to be done.

This enjoins us to deploy our collective vision in our commitment to
entrench democracy, to promote growth and development, improve equality of
opportunity, root out hunger and disease, and protect the marginalised and the
poor.

I call upon the leaders and masses of our people to work with government;
play your part in the realisation of our social compact to restore human
dignity for a prosperous Eastern Cape. I so say, convinced that 'our success
moving forward, depends on us all working together'!

I thank you.

Issued by: Eastern Cape Provincial Government
13 February 2009
Source: Eastern Cape Provincial Government (http://www.ecprov.gov.za)