Chairperson, may I start with a bit of praise. I really think the department deserves some because this is a department with leadership, vision and dedicated staff. It is also one of the few government departments that manages to achieve an unqualified audit, which is laudable. I must say this is a department that continues to surprise us all with the number of projects it is involved in - very exciting projects, colleagues. For those of you who are not members of the committee, it is worth your while to see what they are doing. It is really good stuff.
Having said that, I do have some concerns. Maybe I should start by reiterating the IFP's view that the country's expenditure on research and development, R&D, is too low and needs to be doubled from 1% to 2%. Last year, the hon Minister agreed with this sentiment but the reality is that nothing seems to have happened in the interim. When we engaged with the department about the budget, we were told this was merely an aspiration, not a decision.
Frankly, Minister, this is not good enough. For example, even today you referred to a 1,5% increase not as a decision of government but a wish. In our view, if innovation is going to be central to the economy, you have to spend on R&D. Could we ask you that if we're going to have an increase of 1,5%, it should not be a wish but a decision of Cabinet?
Last week, for example, the Academy of Sciences of South Africa also requested that the expenditure be doubled. That's great, but if you look at the budget of this department, the medium-term expenditure trend for R&D in fact declines with 50% over the next two years. The reason is that the department is winding down spending on the SKA and because other departments are also lead departments for spending. Nonetheless, it sends the wrong signal. In our view, what should have happened is that the level of expenditure should have been maintained to fund new projects, rather than cutting expenditure down. It is not healthy when you reduce R&D by 50%, but it is happening.
The second issue is the country's human resource capacity initiatives. I think it's time for the department to complete its SET Human Capacity Development Strategy. The Minister spoke a lot about human resource development and we applaud what the department is doing. The additional R52 billion on 76 basic lines for bursaries for students is great. Much of what the department is doing in response to the challenges of human resource constraints is to be applauded.
However, the reality is that it's time the department concluded its SET Human Capacity Development Strategy. Two years ago, the department was talking about it. Last year, when the committee engaged with the department, they said they would be ready within a month or two. This year, when we engaged with the department, they said their medium-term target date is 2013. That is not acceptable. In our view, this is an urgent issue and it needs to be attended to as a priority. It's an immediate priority now, not for 2013.
The third issue I would like to make reference to is what appears to be delays in or the slow implementation of operationalising certain entities within the DST family. Let me make reference to the Telecommunications Industry Association, for example, which the Minister spoke about. Now, this House processed the founding legislation over two years ago. Yet the department's medium-term output date for full operationalisation is March 2013. This is four and a half years after the President signed off legislation that gave effect to this body. That is simply too long and we really have to make all sorts of efforts to fast-track this.
TIA is not an ordinary, nondescript entity. It is a key institution that is being established to bridge the gap between innovation and commercialisation. It is a very important initiative and we must get it running as soon as possible. To take four-and-a-half years for its inception and to get it fully up and running is too long.
We have another concern related to TIA - an issue that is being raised by TIA itself and by some of the migrating entities; the seven that the Minister referred to. This relates to the fact that all organs of state are compelled to comply with the Public Finance Management Act. However, the PMFA has certain conditions that are not applicable to TIA because institutions of that kind are impartial, risk-taking enterprises.
The risk-taking nature of structures like TIA does not sit well with the PFMA. The threat is that if the PFMA is rigidly implemented in regard to TIA, it will hamper the TIA's mandate. The question we are asking is, since this is well known to everybody, and has been for some time, why has it not been sorted out yet? What has been done between the department and Treasury to either make an exemption for TIA or to draft the rules in such a way that they won't hamper its mandate?
In conclusion, there is much about this department that we are very happy with and we don't have the time to state all the problems, but well done. We will support the Budget Vote. Thank you.