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President Cyril Ramaphosa: Oral reply to questions in the National Assembly

17 Mar 2022

Replies by President Cyril Ramaphosa to Questions for oral reply in the National Assembly

Question

1. Mr T N Mmutle (ANC) to ask the President of the Republic:

In view of the current escalation of conflict taking place in Eastern Europe which is disrupting global economic activities, during the period where the world is trying to recover from the effects of the COVID-19 pandemic,

(a) how does the Government intend to ensure that such disruptions do not severely impact on the South African economy and

(b) what are the relevant details of the engagements amongst the countries of the world to strengthen the multi lateral approach in resolving international conflicts in a peaceful manner?

Honourable Speaker,

The conflict in Ukraine is a matter of global concern, to many citizens in many different countries.

The international community needs to work together to achieve a cessation of hostilities and to prevent further loss of life and displacement of civilians in Ukraine.

It needs to support meaningful dialogue towards a lasting and meaningful peace, which ensures the security and stability of all nations.

As a country, we are committed to the articles of the United Nations Charter, including the principle that all members shall settle their international disputes by peaceful means.

We support the principle that members should refrain from the threat or use of force against the territorial integrity or political independence of other states.

That is why, at the UN General Assembly Emergency Special Session, South Africa strongly urged all sides to uphold international law, including humanitarian law and human rights law, as well as the principles of the UN Charter, including sovereignty as well.

While there are people within our country and elsewhere that want South Africa to adopt a more adversarial position, our position seeks to contribute to the creation of conditions that make the achievement of a durable resolution of the conflict possible.

Our approach is informed by an analysis of the causes of this conflict.

This includes a view shared by many leading scholars, politicians and other people, that the war could have been avoided if NATO had heeded the warnings from among its own leaders and officials over the years that its eastward expansion would lead to greater, not less, instability in the region.

While it is important to understand and articulate the causes of the conflict, and advocate for peace building measures, we cannot condone the use of force or violation of international law.

We also need to recognise that coercive measures, such as sanctions outside of the legal prescripts of the United Nations, may serve to prolong and intensify the conflict.

Like other countries, South Africa is concerned about the direct impact of the conflict on our own economy, through financial markets and inflationary pressures, that will come about through fule and price increases.

As a small, open economy with significant debt levels, one of the most significant steps that we can take to reduce our vulnerability to external shocks is to improve macroeconomic stability.

We have many strengths, such as a highly developed and well-capitalised financial and banking sector that adheres to internationally-recognised frameworks.

The depth of local capital markets reduces our vulnerability to foreign-currency-denominated debt.

We benefit from having an independent central bank, a floating exchange rate regime and prudent capital controls.

These strengths will be complemented by the work underway to stabilise debt and reduce our deficits, alongside the far-reaching structural reforms that are now underway.

In short, the best way to protect our economy and welfare of our people is to proceed with the implementation of the Economic Reconstruction and Recovery Plan.

The conflict in Ukraine demonstrates the need for a multilateral approach to issues of peace and security.

It also demonstrates the weaknesses in the structure,practices and architecture of the United Nations.

The composition of the UN Security Council, in particular, does not reflect the realities of the prevailing global landscape.

There is a tendency for the most powerful countries to use their positions as permanent UN Security Council members to serve their national interests rather than the interests of global peace and stability.

The Security Council needs to be overhauled so that there is equitable representation and a more inclusive mechanism for resolving international disputes.

We should also work to revitalise the Non-Aligned Movement, to ensure that those countries that are not part of the hegemonic contests between the big powers can work together to build peace across the globe.

We align ourselves with the calls, led by the UN Secretary-General, Mr Antonio Guterres, for de-escalation, dialogue and a return to diplomacy.

Additionally, the Secretary-General has called for an immediate ceasefire, respect for the UN Charter and international law and adherence to existing peace mechanisms, including the implementation of the Minsk Agreements as part of multilateral efforts to end the violence.

South Africa stands ready to support genuine multilateral efforts to end the conflict and achieve a lasting peace in the region.

I thank

Question

2. The Leader of the Opposition (DA) to ask the President of the Republic:

In light of increasing consumer inflation that is driven by rising fuel and food prices, which is predicted to continue to rise further due to the unprovoked invasion of democratic Ukraine by the Russian Federation, and in view of millions of poor and struggling South Africans who have been plunged into financial distress after losing their jobs and businesses because of the COVID-19 lockdown regulations that were imposed by the Government since 26 March 2020, which were widely perceived as heavy-handed and/or irrational, what steps is the Government taking to relieve the citizens from the rising cost of living?

Madam Speaker,

As South Africa works to recover from the damaging effects of the COVID-19 pandemic, our economy is confronted by several other inflationary pressures.

The most immediate of these pressures is the sharp increase in the international price of oil and the price of food as a result of the conflict in Ukraine.

The interconnectedness of the global economy means that no country will be spared from the effects of the conflict and its impact on the supply of goods such as oil and wheat.

Families across South Africa are already feeling the effects of rising prices in supermarkets and at the petrol pump, and many are worried about how they will continue to provide for their families and make ends meet.

We are using all of the levers at our disposal as government to cushion South Africans from the effects of the rising cost of living.

That is why government’s programme of economic recovery and reconstruction focuses on responding to the immediate needs of poor and unemployed South Africans.

The 2022 Budget extends government’s support to poor and vulnerable South Africans by allocating an average of 52% per cent of consolidated spending to the social wage over the medium term.

We extended the special COVID‐19 social relief of distress grant has been extended for 12 months, with additional funding for health, education and the Presidential Employment Stimulus.

Increases in all social grants, including the old age grant, will help poor households to adjust to rising food prices.

Given the improvement in revenue collection, government has proposed R5.2 billion in tax relief to help support the economic recovery, and keep money in the pockets of tax payers, as the Minister of Finance says and boost incentives for youth employment.

To address the rising cost of petrol, the Minister of Finance announced that no increases will be made to the general fuel levy on petrol and diesel for 2022/23 to provide for some respite from rising costs that are continuing to go up.

The Department of Mineral Resources and Energy and National Treasury are reviewing the methodology for the Basic Fuel Price as well as other regulated components to identify changes that could reduce the cost of fuel.

These changes will be implemented as soon as possible.

In short, our fiscal stance will insulate public finances against the possibility of domestic and international monetary tightening while simultaneously supporting households, ordinary tax payers through higher allocations to pro-poor spending.

It is important to acknowledge that the South African economy has thus far proved resilient to external shocks, including the turbulence linked to the conflict in the Ukraine.

We must also dispel the notion that our economic challenges were caused by the measures that we implemented to contain the spread of the coronavirus as well as to save lives.

It was the pandemic, and not measures that we implemeted, that caused a severe shock to our economy and indeed to all economies across the world.

If we had done nothing in response to this grave threat, the economy would still have been disrupted and many more lives would have been lost.

As a result of our collective action to overcome the pandemic, including the rollout of vaccines to millions of South Africans, we have been able to lift all but the most essential restrictions.

Our task now is to ensure that we remain agile and move quickly to cushion South Africans from the risk of higher inflation, to ensure that all are able to meet their basic needs, and to accelerate our economic recovery. This is tye direction that we have chosen to take.

I thank you.

Question

3. Mr J S Malema (EFF) to ask the President of the Republic:

Given reported high levels of crime in the period between 1 October and 31 December 2021, in which the Republic experienced 164 953 contact crimes, of which 14 188 were sexual offences, 6 859 murders and 60 cash-in-transit heists, what is the reason that he removed the National Police Commissioner, General Khehla Sitole, but retained the Minister of Police, Mr Bheki Cele?

Honourable Speaker,

The outgoing National Commissioner of the South African Police Service, General Khehla Sitole, and I had been in communication over some time about matters that led to the mutual agreement on the early termination of his contract.

These discussions were therefore not related to the crime statistics for October to December 2021, but were instead guided by what would be in the best interests of the country.

The latest crime statistics reflect the huge task we face as a society to combat crime and violence.

These statistics show improvements in some areas and but also reversals in other areas.

Between October to December 2020 and the same period in 2021, for example, there was a 9 per cent increase in murders and a 14 per cent increase in car high-jackings.

At the same, there was a 9 per cent drop in sexual offences and an 8 per cent decline in burglaries and other property-related crimes.

While these quarterly statistics are important for tracking crime trends and informing our responses, the reality is that crime remains stubbornly high in our country.

This reality reminds us that reducing crime is a responsibility that all of us need to shoulder – as the police, as political leaders, as communities, as families, as business people, as workers, as civil society.

The recruitment of 12,000 additional police officers, among other measures to strengthen the police, will help us to turn the tide and create safer communities for all.

I thank you.

Question

4. Mr F Jacobs (ANC) to ask the President of the Republic:

Given current concerns of the small business sector, some of which he referred to during his State of the Nation Address on 10 February 2022, and in view of the measures to build capacity in The Presidency to reduce burdensome red tape,

(a) what specific actions will the Government take in 2022 to ensure growth in the small business sector and

(b) how will the Government infuse the entrepreneurial mindset into the fabric of society through its institutions, so that every citizen is exposed to entrepreneurship in light of the unemployment and job loss crisis?

Honourable Speaker,

A central pillar of government’s programme to grow the economy and create employment are far-reaching measures to unleash the potential of our economy, but focusing particulalry on small businesses, micro businesses and informal businesses.

This includes reducing the cost of doing business and removing barriers to entry for small businesses.

South Africa does not lack an entrepreneurial spirit.

Indeed, we have abundant talent, energy and creativity, and many entrepreneurs who are ready and willing to start their own businesses.

Too often, however, these entrepreneurs are frustrated by excessive regulation and a massive burden of compliance.

It is for this reason that I announced in the State of the Nation Address that we would create dedicated capacity in the Presidency to reduce red tape, with a team led by Mr Sipho Nkosi to do precisely that

This team will identify priority reforms and work with other departments and agencies to simplify regulatory processes and unlock specific obstacles to investment and business growth.

It will build on existing work undertaken by Departments, be that the the Department of Trade, Industry and Competition, the Department of Small Business Development and a number of other departments like Infrastructure Build and Water and Sanitation.

Focus areas in 2022 include continued work with SARS to improve the turnaround times for processing VAT refunds for SMEs, reviewing onerous licensing requirements that make it difficult to start and operate a business, making it easier for SMEs to do business with the state, and working with private and government funding institutions to make it easier for SMEs to access the credit needed to operate and grow their businesses.

I have made it clear that our job is to enable businesses, not to stifle them.

In addition to these measures, the Department of Small Business Development and other public institutions such as the National Youth Development Agency will continue to provide funding and support to SMEs.

The Small Enterprise Development Agency – SEDA – will continue to establish new incubators and digital hubs that provide a broad range of business development support to SMEs and cooperatives particulalry in under-served areas.

This includes Centres for Entrepreneurship and Rapid Incubators in institutions of higher learning to foster a culture of entrepreneurship among young people, students and convert job seekers to job creators.

SEDA has also developed the Basic Entrepreneurship Skills Development programme, which is funded by the National Skills Fund.

This programme uses coaching to facilitate and reinforce learning and development support to emerging entrepreneurs.

More than 2,000 emerging entrepreneurs have to date been supported through the programme.

Through our Youth Challenge Fund, we aim to support 10,000 young innovators over the next year.

We are implementing a programme to support entrepreneurship in schools, called ‘Step-up to a Start-up’, which encourages learners to consider entrepreneurship as an alternative career to employment.

The programme aims to equip learners with entrepreneurial knowledge and skills needed to start and manage their businesses.

By making it easier for small businesses to grow, by expanding access to finance and support, and by reaching out to young would-be entrepreneurs, we are determined to unlease the potential of small businesses to create the jobs that the country needs. We want to encourage the spirit of entrepreneurship among South Africans.

I thank you.

Question

5. Mr M Hlengwa (IFP) to ask the President of the Republic:

In light of his announcement that he made during the State of the Nation Address on 10 February 2022 that the Government intends to establish a shareholding company for state-owned enterprises (SOEs), what are the envisaged restructuring plans of the Government to manage the SOEs in order to ensure their effectiveness, efficiency, viability and sustainability?

 Honourable Speaker,

State owned enterprises are critical drivers of inclusive economic growth and social development in our country.

However, the reports released by the Commission of Inquiry into State Capture demonstrate the extent of the repurposing, damage and theft caused by state capture.

We are therefore working to reposition strategic SOEs to fulfil their vital economic and social mandates.

International good practice suggests that a centralised shareholder model – along with a central authority to house strategic state-owned companies – is the best way to ensure effective oversight.

A centralised shareholder management model is likely to entail the following:

Firstly, a holding company that is 100 per cent owned by the State.

Secondly, an active shareholder approach to continuously set, monitor and evaluate SOE performance in relation to commercial and development objectives.

Thirdly, ensuring commercial sustainability of SOEs with minimum or no reliance on the fiscus.

Fourthly, development of an appropriate capital structure for the holding company to ensure profitability and sustainability of each SOE.

Based on the recommendations of Presidential SOE Council, government is reviewing state ownership policy in terms of which SOEs need to be owned by the State as well as the extent thereof.

The Presidential SOE Council is evaluating the financial and operational status of the major SOEs and reviewing the turnaround plans for each SOE in crisis.

The journey that we have embarked on will transform the manner in which SOEs are governed and managed for the benefit of the nation as a whole. This is a transformation that is long overdue.

I thank you

Question

6. Dr P J Groenewald (FF Plus) to ask the President of the Republic:

Whether, as part of restructuring the security cluster, he will consider utilising an independent panel of experts to consider the short-listed candidates and make a recommendation on the appointment of the next National Police Commissioner; if not, why not; if so, what are the relevant details?

Honourable Speaker,

The appointment of the National Commissioner of the South African Police Service is governed by Section 207 subsection (1) of the Constitution, which says:

“The President as head of the national executive must appoint a woman or a man as the National Commissioner of the police service, to control and manage the police service.”

While this places sole responsibility for the appointment of the National Commissioner in the hands of the President, it does not preclude the President from putting in place a process to seek recommendations and proposals.

This is the approach that I took with respect to the appointment of the National Director of Public Prosecutions and to the identification of potential candidates for the position of Chief Justice.

In each case, the approach that I took was informed by the specific circumstances and the nature of the position.

These considerations will continue to inform the approach that I take with respect to the appointment of the SAPS National Commissioner.

I thank you.

 

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