Committee Programme 2020 Term 1

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Public Enterprises

12 February 2020
Chairperson: Mr K Magaxa (ANC)
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Meeting Summary

The Committee considered its draft programme for the first term of 2020. It was not adopted as further interaction and engagement is needed to decide on whether to attend both proposed joint meetings with Standing Committee on Public Accounts on Eskom (18 February) and SAA (19 February) or to have first an oversight meeting with the Department of Public Enterprises. Members gave suggestions and recommendations such as about inviting sector experts.
 

Meeting report

First Term Committee Programme
The Chairperson noted that this was the Committee’s first meeting in 2020. He drew the Committee's attention to the draft programme which had scheduled meetings for the first term between 12 February 2020 and 20 March 2020.

The Committee Secretary took the Committee through the draft committee programme. He mentioned that the draft programme takes into consideration the invitation received from the Standing Committee on Public Accounts (SCOPA) for a 18 February joint meeting on ESKOM. This had been included intentionally in the programme and he had sent the invitation letter to the Committee Members. However, the Committee should discuss and make an input on the Committee's interest in a meeting of that nature because SCOPA wants it to be a joint meeting.  

He stated that on 19 February there would be a briefing by the Department of Public Enterprises (DPE) on the third quarter financial and operational performance of DPE and state-owned companies.

The Secretary mentioned that also on 19 February the Committee had received an invitation from SCOPA to have a joint meeting with SAA. The Secretary clarified that the agenda is similar to the one this Committee has scheduled for Wednesday 26 February. The only difference is that SCOPA has also invited the Minister of Public Enterprises and the SAA Business Rescue Practitioners to brief Parliament. The Committee would obviously need to discuss this and make a decision on that. Also on the same day there is a proposal for the Committee to engage with Department of Energy experts on their views on the challenges facing Eskom and the possible solutions.

On 4 March there would be a stakeholder engagement on SAA and SAX, Department of Transport, organised labour and aviation industry experts on the same issue of the challenges facing airline companies and proposed solutions from stakeholders.

On 11 March there would be a stakeholder engagement on Transnet on how Transnet can contribute to economic growth and socio-economic transformation with specific focus on the priorities of government: rural development, job creation and support of small and medium businesses. That was the programme for the first term.

Strategic Planning Session
The Secretary said that there was a proposal for a two-day strategic planning session on the 18 and 19 March because the Committee had not had one. The researchers and content advisor had drafted a proposal to the Committee for consideration. There was a draft programme in place with identified stakeholders for the strategic planning session.

The suggestion was that on the first day of the strategic planning session, the Committee should invite the Institute of Directors in South Africa (IoDSA), Department of Public Enterprise and the Centre for Enterprise Development at Wits University. IoDSA is the custodian of corporate governance in terms of the role of directors in government and private companies. The Centre for Enterprise Development had been developed at Wits University and it focuses on role of public enterprises. IoDSA would need to focus on corporate governance and monitoring mechanisms for the Portfolio Committee to empower it so it can exercise its oversight in holding the executive accountable without ignoring legislation, the role of ministers, the board and management of state enterprises. This is to develop an oversight mechanism for Committees.

The second presentation on 18 March will be by industry experts. Presentations have been put into three different categories: transport and manufacturing, energy and aviation. They propose using Dr Edwin Ritchken who is a former employee of the Public Enterprises, who is at the Wits University Centre. The Secretary described him as a resourceful person in terms of the industries in which the state-owned companies operate. It was only a suggestion and the Committee is at liberty to identify any other experts. The researcher and content advisor had been tasked to identify and nominate names for the Committee's consideration. The second day would need to look at the strategic plan for the Sixth Parliament which entailed the priorities for the Committee, its oversight mechanism and how the Committee would operate moving forward in implementing oversight and holding the executive accountable.

Discussion
Mr S Swart (ACDP) referred to the 19 February meeting where on the same day there is an option to meet with SCOPA and believed that the joint meeting would be a good idea. He recognized that there was a choice  between 18 and 19 February and suggested that the Committee would need to consider this as business rescue is quite an issue. There is a need to have an understanding of the legal implications of being under business rescue and the Committee should meet with SCOPA and SAA on 19 February.

He noted the stakeholder engagement with energy experts on 26 February and organised labour is included which is good. He suggested that other stakeholders should be invited as well, such as those that are making use of energy, for example, Business Unity South Africa (BUSA). He emphasised the need for inclusivity and recommended that the clients impacted by the Eskom challenges should be invited. For the 11 March stakeholders’ engagement on Transnet, a big challenge is the transport of coal and the impact it has on Eskom, so one needs to have an engagement with the clients of Transnet. Transnet might come and say is all well, which is unlikely, and the Committee should, if possible, seek someone to help with input from the client perspective. That would help in understanding some of the challenges. He fully support having organised labour there but suggested including the clients that make use of Transnet. He would like to know why they use road instead of rail.

For the strategic planning, Mr Swart would also like to consider the Fifth Parliament's Legacy Report –particularly on Eskom.  There are a number of Legacy Report recommendations that the Committee should look at especially the degree to which they have been implemented. He suggested last year to meet with the law enforcement agencies, to check on progress. That could be jointly with the Justice Portfolio Committee with the Hawks and the National Prosecuting Authority (NPA), as it impacts this Committee directly.

Ms J Mkwananzi (ANC) proposed that the Committee should hold both 19 February proposed meetings but it would be wise to meet with DPE on 18 February and then have the joint meeting on SAA on 19 February. It is important that the Committee talk with the Department about its progress on committee resolutions taken last year before engaging with any entities. The meeting with DPE is important for  empowerment and moving forward instead of repeating the same thing. Oversight should be exercised. The Committee should put on the 18 February agenda the DPE progress report on committee resolutions. The Committee will be going in circles if they do not go back to those resolutions and check how far DPE has gone in the implementation of those resolutions.  Her second suggestion was that the Committee should consider their oversight visit on the second day of the strategic planning session as it has been discussed for a long time and a team of advisors should be contacted.

Mr S Gumede (ANC) agreed with Ms Mkhwananzi. He strongly felt they needed to be updated on what has been happening in their absence during parliamentary recess. He remarked that at times he wants to hide but at the same time he is very proud back home in his constituency that Parliament serves the community and what the parliamentary committees are doing. However, when there is load shedding, people start looking for answers. The Committee should have an Eskom meeting and be informed about what is really happening. He expressed his support for the joint meeting with SCOPA but suggested that the Committee could as a preview meet with DPE and get information and be ready for questions.

Mr Gumede said Parliament should bring back programmes that were dropped in 2019 prior to elections. He had spoken to the Whip and learnt that the Ad Hoc Committee on Section 25 has Mr Buthelezi serving on it and it has a programme. The Committee programme they pass will likely be reviewed as soon as they get the Ad Hoc Committee on Section 25 programme so that they do not break its quorum and there is need to report quickly on availability. He suspects that Mr Buthelezi will be part of that committee programme of public hearings and so some Committee Members will not be part of the programme. He has noticed some positivity as the Committee mainly meets on Thursdays but the programme indicates that on Wednesdays they may be available if the programme follows the same pattern as the draft.

Mr E Buthelezi (IFP) said that he had not seen the SCOPA invitation for the Tuesday 18 February meeting when he had read the programme and asked if the Committee could favor that programme.

Mr G Cachalia (DA) said that it is important that the Committee address Eskom and SAA as both their operations and service delivery is in crisis. He stated that Eskom and SAA and the Business Rescue team have being working throughout the holiday season and have finally come to the table to address these issues. He supported the suggestion to bring business on board to give their input as the clients of Eskom and Transnet. It is important for the Committee to have prospective names of experts who are being considered to give an input.

The Secretary took note of the Members’ suggestions and asked for clarification from Members.

The Chairperson was of the opinion that as SCOPA is already on board for the Eskom meeting, the Committee ask the Secretary to interact with both DPE and SCOPA for possible rescheduling. He suggested that the Committee meet with DPE on 18 February and then check if SCOPA agrees to a joint meeting with Eskom on 19 February. It is something that cannot be decided alone as there is correspondence from SCOPA on that. Therefore, the Committee will have to engage SCOPA as this Committee's wish is to have an interaction with Public Enterprises first before engaging with Eskom. He asked if Members agreed.

Mr Swart appreciated the concern but the dates were soon and the challenge in rescheduling could be that expenses had already been incurred for people to come. He suggested pursuing a different avenue if the Committee could not be accommodated in a joint Eskom meeting as they have previously engaged with Eskom already. However, it would be important for the Committee to get the briefing documents from SCOPA.

The Chairperson suggested interaction with SCOPA first before the Committee moves to a decision, and that should be done as soon as possible.

Mr Gumede asked for clarification and the Chairperson clarified that the meetings are not supposed to take place on the same day.

Ms Mkhwanazi suggested having both meetings.

The Chairperson objected to this.

Mr Swart asked that when strategic workshops are conducted that the researchers look at the professors at the University of Cape Town. There was a certain professor whose name he had forgotten, who helped the Committee with his deep insight. He had helped the Portfolio Committee by preparing a booklet on the history of Eskom. He asked if the Committee was in agreement to invite the business clients of state-owned companies as well and possibly BUSA, as that will create balance.

The Chairperson replied that as long as the Committee would not have to spend a lot of money as experts are costly but if it is a person from the University of Cape Town, he does not think it will be a problem as the university is close by.

The meeting was adjourned.

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