Oral replies by Hon. David Mabuza, Deputy President of The Republic of South Arica in the National Council of Provinces
Processing flood-relief funds
The Honourable Chairperson
The House will remember that roads, bridges, water and sanitation pipelines, telecommunications, power lines, houses, schools, and health care facilities were among the critical infrastructure that was severely damaged.
Collectively, this impacted on the delivery of basic services by the government within eThekwini municipality.
In response to the flood disaster that occurred in April, inflicting severe destruction on affected municipalities, the government responded by sending multisectoral response teams in a three-pronged approach to better coordinate response, recovery, and reconstruction measures within all affected provinces, including KwaZulu-Natal.
The three phases are: immediate humanitarian relief; stabilisation and recovery; and rehabilitation and reconstruction.
The National Treasury and CoGTA have worked with the KwaZulu-Natal provincial government to identify and reprioritise resources to respond to the current crisis and cover any shortfalls. Various projects are being rolled out and are in various stages of implementation.
We take this opportunity to acknowledge and thank the private sector and community-based organisations for their contribution to the implementation of disaster relief measures and the provision of essential infrastructure and services to affected communities.
The Honourable Chairperson
As government, we want to confirm that the process has not been as smooth as we anticipated it to be. Even though we have the multidisciplinary systems we referred to above, there were still problems with planning, execution, and keeping track of projects.
We established this later during an audit of progress we have made within the period we had set ourselves to complete this process. Observed weaknesses are the prevalence of old challenges that resulted in serious delays in meeting our delivery deadlines as initially determined.
These challenges included, amongst others, poor coordination, integration and sharing of capacity and resources between all three spheres of government that would have mitigated against:
- inadequate identification and measurement of the extent of damage;
- poor project management, including tight planning, budgeting and execution;
- poor contracting, including pricing and monitoring of project delivery timelines;
- inadequate risk management processes, including procurement risks and supply chain management weaknesses; and
- unnecessary delays caused by policy red tape and tideous procedures when responding to disasters.
All of the above resulted in a failure to monitor and track progress and quality of project delivery, leaving affected communities and people highly frustrated while forced to live for prolonged periods in unconducive conditions. To this effect, we want to take this opportunity to apologise to all affected communities, families, and individuals for having subjected them to this situation.
As part of remedying the situation, we will strengthen our monitoring mechanisms, identify implementation capacity gaps and work with the provinces to close those gaps while creating synergies across the entire value chain to ensure that people are assisted as promptly as possible.
We are recommitting to remedying the situation by ensuring that we urgently put an end to the misery currently faced by communities, families and individuals affected by the recent flood disaster in eThekwini and the other municipalities by:
- Strengthening intergovernmental coordination between the three spheres to ensure that all the weaknesses above are attended to.
- Ensuring that intergovernmental capacity acts with urgency to restore livelihoods and improve services to all communities in eThekwini and other affected municipalities within a set time frame.
- Making sure that national, provincial, and municipal leadership commit to take urgent actions within strictly specified dates.
- Ensure that suitable preventative controls are identified, strengthened and implemented as a matter of urgency to avoid wastage, corruption, and failure of the infrastructure rebuilding phase on a set time line.
- Ensuring that effective service delivery and value for money are realised.
- Continue to build disaster management capabilities to prepare for future disasters.
- Ensuring transparency and continuous communication of progress to affected communities, families, and individuals.
We should also acknowledge the presence of objective factors with regards to the availability of suitable well-located land for sustainable human settlements near to places of work that have also played a major role in the settlement of people.
We call on all stakeholders to commit to joining hands with us in ensuring that we minimise the effects of disasters on communities by promoting sustainability and disaster-proof measures.
Our municipalities remain ready to assist where necessary in ensuring that human settlements are located and built in suitable and safe areas to prevent any unforeseen disasters that might occur.
Thank you very much.
On the National Energy Crisis Committee
Honourable Chairperson,
The Political Task Team on Eskom which the Deputy President chairs, was established by the President to serve as an institutional policy coordination platform that brings together key players within government to provide political leadership towards the resolution of challenges facing Eskom.
The Task Team was mandated to coordinate the implementation of interventions aimed at ensuring that Eskom is able to among others:
- resolve key challenges around the implementation of a credible and transparent National Maintenance Programme;
- oversee the speedy implementation of short-term energy generation and supply measures to address the electricity demand gap; and
- implement a targeted programme to address rising municipal debt to Eskom.
Additional to the above mandate, the Political Task Team also tended to the acceleration of the Just Energy Transition plan, which incorporates the use of renewable energy towards sustainable and equitable low carbon energy systems.
To this end, the Political Task Team on Eskom has been successful at policy level in delivering on its mandate. The notable milestones include:
- Enabling and fostering greater coordination between Eskom and various government departments;
- Ensuring that Eskom develops and implements a credible and transparent national maintenance programme;
- Fast-tracking the emergency procurement of additional energy to address the electricity demand gap;
- Addressing debt and liquidity challenges, which included the recovery and payment of debts owed to Eskom by government entities and municipalities; and
- Fast tracking the process of Ministerial Determination on Bid Window 5 under the Renewable Energy Procurement Programme.
Honourable Chairperson,
The Political Task Team was also seized with expediting the correction of plant defects at the Medupi and Kusile Power Stations in order to ensure that the grid has additional 1000 megawatts of baseload capacity to address the load shedding problem.
Notwithstanding all these policy coordination interventions and milestones, it is common course that Eskom continues to experience inconsistent supply of electricity due to plant breakdowns. In the main, challenges centred around the limitations of the ageing fleet, and the inability to keep up with the demands of unplanned maintenance and repairs. Inevitably, inadequate energy generation capacity resulted in declining energy availability.
This led to sustained power outages during the month of July 2022 thereby attracting public backlash, that prompted an urgent dedicated Cabinet discussion on further extraordinary measures to immediately bring to a halt what was becoming a perennial national electricity supply failure challenge.
The outcome of this discussion led to President announcing the National Energy Action Plan on the 25th of July 2022 that represents a step-change in our efforts to achieve energy security.
It became necessary to build on the work of the Political Task Team by establishing an institutional mechanism that will be dedicated to sustained, hands-on, strategic and technical operations in order to respond effectively to the energy supply challenges. At this point, work of the Political Task Team was transitioned to be covered within the scope of the National Energy Crisis Committee.
The immediate priority of The National Energy Crisis Committee is to unlock policy and implementation blockages, streamline decision-making processes, and eliminate any red tape issues.
In his statement, the President announced that the National Energy Crisis Committee will focus on the following five interventions, namely:
- Stabilising Eskom and improving plant performance and establishing a competitive electricity market;
- Transitioning to new sustainable energy sources from renewables, gas and battery storage;
- Releasing businesses and households to invest in rooftop solar; and
- Transforming the electricity sector to achieve long-term energy security so that the country never experiences electricity shortage.
The immediate objective of the National Energy Action Plan is to reduce the severity and frequency of load shedding by implementing measures to stabilise the energy system. This will be dealt with by the National Energy Crisis Committee on daily basis, at both technical and operational levels to ensure quick turnaround times in the implementation of priority projects and policy reforms.
Looked at objectively, the focus of the Plan is to upscale and strengthen maintenance measures by mobilising and acquiring requisite skills across society including private sector.
This includes fast tracking the participation of the Independent Power Producers in resolving the current energy crisis, mobilisation of investment in energy projects, as well as the procurement of additional energy into the grid.
We are positive that the implementation of this plan will fast track additional generation capacity to be added into the grid, thus ensuring energy security and reducing the severity and frequency of load shedding.
Thank you very much.
On Eskom Debt Recovery Plan
Honourable Chairperson
Debt owed by municipalities to Eskom remains the biggest challenge to the utility’s financial sustainability. According to the National Treasury, debt by municipalities to Eskom has since grown from 44.8 Billion Rands to 49.1 Billion Rands between March and July 2022. This is not a desirable state of affairs for both Eskom and municipalities.
That is why Eskom forms part of the Multi-disciplinary Revenue Committee, which is meant to address challenges related to the payment of debts owed to Eskom by municipalities and organs of state. The Committee’s main task is to improve revenue collection and the strengthening of partnerships with various stakeholders, in order to improve payment levels of indebted municipalities. These efforts include the implementation of the Eskom Active Partnering Programme by defaulting municipalities.
Through the Eskom Active Partnering Programme, municipalities can collaborate with Eskom to address their business and operational difficulties in a non-threatening and secure environment, ensure sustainability of electricity infrastructure, and the upscaling of municipality’s technical expertise.
The programme's holistic focus enables municipalities to rebound financially and carry out their constitutional obligations to provide their customers with more dependable electricity.
Through this programme, municipalities benefit from securing their revenue stream and are able to pay for their large-scale electricity purchases from Eskom.
Eskom's responsibility in this model is to assist municipalities by presenting them with a customised solution to handle their unique challenges.
The partnerships' joint efforts are intended to increase the consistency and security of consumers' access to electricity, while guaranteeing that the proper tariffs are applied, and that there is implementation of more robust control measures to promote sustainable economic recovery. More importantly, implementation of more robust control measures enhances revenue collection, and targeted investments in sustainable electricity provision infrastructure.
Already, as part of this Active Partnering Model, a number of defaulting municipalities across different provinces are in the process of negotiating and concluding Service Level Agreements with Eskom. This includes the Maluti-a-Phufong Local Municipality which is on the brink of signing the Agreement with Eskom.
Due to the rapid growth and quantum of the balance, Eskom is collaborating with the National Treasury on structuring solutions to assist with the collection of municipal arrear debt and manage the payment of municipalities’ current accounts in order to prevent any further growth in arrear debt.
Having, said this we must agree that an arrear debt of 38 Billion Rands is highly unsustainable.
That is why the National Treasury is working with the Department of Public Enterprises and Eskom to develop sustainable solutions that will address Eskom’s debt burden in an equitable and fair manner.
As part of internal cost efficiencies and equity conditions, a cost savings target of 21.4 Billion Rands for the 2023 financial year, and a cumulative 61.8 Billion Rands over the medium term of 2020 to 2023 has been set by Eskom.
However, Honourable Members should note that these interventions will not necessarily reduce tariff increases, as tariffs are not cost reflective. Instead, the measures will assist in migrating towards the cost reflective arrangement. These cost savings will therefore, amongst other things, assist in absorbing the increase in diesel and wage settlement costs.
With regard to long-term sustainability of Eskom, the National Treasury in collaboration with the Department of Public Enterprises is regularly monitoring Eskom’s liquidity position and operational efficiencies.
The National Treasury is undertaking this work with a view to develop a multi-pronged solution, which includes improving internal efficiencies at Eskom and reducing the debt burden. It is envisaged that this solution will return Eskom to financial sustainability in the long-term.
Having said all of this, we must re-emphasise the need for citizens with financial means to pay for the services they receive. We will continue to instill in all our communities, a culture of payment for the services they utilise.
To assist in this regard, SALGA has ordered municipalities to start a strict debt collection and restructuring process, in an effort to recover debt owed to them and to stop municipalities' mounting debt to Eskom.
Thank you very much.
On the Establishment of National Anti-Corruption Advisory Council
Honourable Chairperson,
The ANC led government remains committed in fighting crime and corruption in the country. In efforts of intensifying the fight against corruption and maladministration, the President announced in the 2021 State of the Nation Address an establishment of the National Anti-Corruption Advisory Council.
The Council is a multi-sectoral advisory body that will advise the President on matters related to the fight against corruption in the country.
The process of the appointment of Commissioners to the Council started with the public call for nominations, and the shortlisting of eligible candidates which was conducted in March 2022. A list of shortlisted candidates has since been submitted to the President for his consideration.
Since the appointment of the National Anti-Corruption Advisory Council members is the prerogative of the President, it is a normal and acceptable practice not to prescribe timelines on matters of this nature. The President is well aware of the urgent need to have this important advisory body, and will in due course make appropriate appointments.
Once fully constituted, the Council will amongst other responsibilities, oversee the implementation of the National Anti-Corruption Strategy as well as the establishment of an independent statutory anti-corruption body reporting to Parliament.
Thank you very much.
On Land Invasions
Honourable Chairperson,
We acknowledge and recognise the legacies of spatial inequality, land dispossession, marginalisation and exclusion that continue to threaten social cohesion.
This challenge should be looked at within the broader context of poverty, inequality and unemployment in South Africa. Our view remains that if we do not address the issue of land justice, we will be aiding in the cultivation of inevitable social friction that will pull us backwards instead of launching us into a prosperous and shared future.
For as long we do not address the challenges of inequitable access to economic opportunities in our society, people will naturally move to places where there are prospects of sustainable economic livelihoods.
The historical apartheid spatial planning arrangement, has created internal push and pull factors that force people to move to urban areas in search for economic opportunities.
This increases land hunger for human settlements and ultimately, incidents of illegal land invasion and occupation, especially in urban areas. The illegal occupation of land and property negatively impacts on social cohesion within communities. It also fuels social tensions and undue confrontations between law enforcement authorities and land invaders.
Part of the responsibility of the Inter-Ministerial Committee on Land Reform and Agriculture, is to develop policies and the legislative framework to ensure equitable land redistribution. In this regard, government has taken preventative measures to expedite the release state-owned land for human settlements development and economic development. This is expected to result in meaningful participation in the economy.
Honourable Chairperson,
We strongly condemn anyone, whether civic or political, who promotes and encourages illegal invasion of land and properties.
Such a posture borders more on encouraging people to indulge in acts of lawlessness. We must be clear that illegal invasions are criminal. They negatively impact on the legitimate rights of individuals and communities to access land, housing, and property in a planned and orderly manner.
As leaders, we must act responsibly and ensure that people access the land within Constitutionally-defined processes, rather inciting people to break the law.
Our focus should be on helping them in addressing and resolving socio-economic challenges through collective commitment, shared national interest, and purposeful cohesion.
It is for this reason that we continue to engage various sectors of society to find legitimate means of resolving prevailing contradictions in society. We thank Traditional and Interfaith Leaders for their continued collaboration and support of various government efforts that face communities.
From a policing perspective, the South African Police Service leads the implementation of a National Rural Safety Strategy, which was launched by the Minister of Police in 2019.
The strategy provides for policing requirements related to land rights and land tenure disputes. Land invasions are closely monitored by local police stations and where applicable, by Metro Police. This is continuously reported to the Provincial Joint Operational Command Centres.
Furthermore, the Ministry of Police continuously engages communities through Izimbizo and Awareness campaigns, emphasising good relations and social cohesion. These engagements are yielding positive results where communities are working with policing structures to report illegal actions of land invasion.
Our commitment to ensuring equitable land access for development remains firm and unwavering. However, we will ensure that land restitution, redistribution and tenure reforms are not undermined by acts of unlawful land invasion and occupation.
Thank you very much.
On Intervention Measures in Municipalities
Honourable Chairperson,
The state of local government remains an important area of interface and delivery of services to the people. We are mindful that due to various subjective and objective factors such as weak or non-existent tax base, a number of municipalities are still struggling to perform at desired level that ensures the realisation of a better life for all South Africans.
Of major concern is that most of our municipalities are struggling to provide critical infrastructure and services that are key to sustaining existing local industries, and attracting new investments necessary for inclusive economic growth and job creation.
The availability of well-maintained bulk water and sewerage infrastructure, and road networks are critical to supporting businesses, and facilitating investments and mobility of goods to markets. A large number of our low capacity municipalities are struggling to maintain and expand key socio-economic infrastructure in a manner commensurate with rising population, in-migration, and increasing demand for services.
Through Intergovernmental Relations Structures there is consensus that in order to ensure sustainability of municipalities, some of the areas that require improvement are leadership capacity, managerial competence, financial management skills, technical and project execution skills especially in infrastructure projects.
Government has taken a view that a coordinated, integrated and holistic approach is required to support development and service delivery at local government level.
The coordination and consolidation of key resources and capabilities through the District Development Model creates a necessary institutional platform for government, the private sector and community stakeholders to bring about investment, infrastructure development and maintenance as well as essential support to businesses and local economies.
Through national government, municipalities are supported with the provision and maintenance of bulk water and sewerage infrastructure to address prevalent challenges of water and sanitation provision.
From a governance perspective, the District Development Model supports targeted performance improvements in financial management, audit outcomes, integrated service provisioning, spatial planning, and systems of leadership transparency and accountability to the people.
Importantly, this also includes the management and administration of legislation, policies and compliance requirements for development, investment attraction, access to land and opportunities for setting up businesses.
Honourable Chairperson.
To prevent of the collapse of economic activity in rural and small towns, Cabinet, at its Economic Retreat, identified some immediate measures for implementation that, by and large, talk to reforms intended to eliminate red-tape. These reforms include:
- Improvements in Environmental Impact Assessment timelines;
- Implementation of electronic deeds registration to enable property development and construction;
- Streamlining the application process for tourism transport licences; and
- Removing restrictions on informal trading, including through changes to zoning and land use regulations.
These issues continue to receive priority attention and would improve economic prospects in small towns. In the immediate, government has introduced the Integrated Urban Development Framework that is conceptualised across a spectrum of municipal spaces. This would also complement efforts to support rural economies to thrive and anchored on agriculture.
It puts forward a new deal for South African cities and towns by providing the framework for reorganising the system, so that cities and towns can become more inclusive, safe, productive and resource efficient.
Furthermore, the Department of Cooperative Governance and Traditional Affairs, in partnership with the South African Local Government Association has launched the Small-Town Regeneration Strategy to revive, restore and fulfil the economic potential of underperforming small towns.
This Strategy also embraces the value of small towns and their central position in larger hierarchical settlements while addressing the developmental needs of small towns.
So far, the strategy has been piloted in Modimolle in Limpopo, Senekal in the Free State, and Piketberg in the Western Cape. It is envisaged that, once fully implemented, the Small -Town Regeneration Strategy will be applied and adopted by all relevant municipalities.
Within the context of the District Development Model, Government’s land reform programme has identified agriculture as one of the key catalytic economic sectors that will continue to anchor local economic growth and job creation in pre-dominantly rural municipalities with limited industrialization and revenue base. In this regard, state-owned land is currently being released to make land available and broaden participation in the agricultural sector by previously disadvantaged individuals
There are opportunities for growing and supporting agri-businesses across the entire agricultural value chain to ensure that economic participation is enhanced.
We must underscore the point that the successful implementation of the District Development Model, will require ownership by all stakeholders that are critical in development, including the private sector and civil society.
Effectively implemented, we would ensure that municipalities are enabled to perform their mandated functions and duties by mobilising, sharing and making available expertise, skilled personnel and systems between district and local municipalities whenever needed.
Thank you
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