Hon Chairperson, hon Minister and hon Deputy Minister, hon members, the leadership of the state-owned enterprises and all guests, all protocol being observed - I must say this also in Parliament.
The ANC and Parliament welcome the department's budget for this financial year. The ANC, in particular, supports the budget of the department for this financial year, which indicates a huge decrease compared to previous years.
In the past two financial years the department was allocated R3,2 billion and R3,9 billion, respectively. This year the department has been allocated only R350 million, a decrease of 91,7%. This decrease is not only a result of the government's realignment of priorities, but also resonates with the infrastructure programme that the President announced earlier in which a huge amount of money, amounting to R868 billion, will be spent in the next three years.
Although the department's budget has been significantly reduced, quite a lot of money will be spent on the infrastructure building of some of the SOEs in the next three years.
State-owned enterprises have a huge role to play in a developing country's industrial base. They need to interrogate the sectors in which they operate and to fit into the country's industrial framework. We will recommend to SOEs that they interrogate and participate in the New Industrial Policy Action - Ipap2 - to identify their role and where they will fit in, and to prepare themselves for meaningful participation in economic growth.
I would like to speak about oversight from a constitutional perspective. Although we accept this budget, we want to declare from the portfolio committee's side that we will be upping the game in terms of oversight, in so far as the department, its political heads, namely the Minister and the Deputy Minister, as well as the SOEs themselves are concerned.
We find this mandate of the committee in section 55 of the Constitution, which gives Parliament the right to ensure that all executive organs of the state in the national sphere of government are accountable to Parliament. Section 55(2)(b) also says that we need to maintain oversight of the national executive authority as well as any organ of state. I want to declare that all SOEs are organs of state. On the basis of this constitutional principle, we will be intensifying oversight in the current financial year.
The President has made a call for an activist Parliament. We will do so from the oversight side to ensure that the objective of remodelling Parliament into an activist one is realised. In fact, Parliament has embraced this call by the President.
The other section of the Constitution I would like to refer to as outlining the kind of oversight we intend to play, is section 92 of the Constitution, which calls upon Parliament to hold the Cabinet collectively as well as individually accountable in so far as the performance of their duties, functions and powers are concerned. I think that sometimes when we cry foul, or have problems with SOEs, we tend to put a lot of pressure on the Minister, which is correct, but we often forget that Cabinet also has the role of strengthening the Minister's hand in ensuring that SOEs fulfil their functions and their mandates. To this extent, we intend to do what the Constitution expects us to do: to hold Cabinet members individually, in the form of the Ministers and the Deputy Ministers, and collectively to account in so far as the SOEs are concerned.
The President was cognisant of this role when he called for an overview of the SOEs. I think he was leading as the head of Cabinet in saying that we need to pause as South Africa and review the mandates of SOEs and align them with the objectives of a developmental state.
The ANC's resolutions actually go further and mention three specific things, which I would like to say will be the clarion call from our side in this financial year. We will be monitoring the impact of each SOE in participating in economic growth. We will do so with sister committees of the Departments of Trade and Industry and of Economic Development and others.
We will also ensure that skills development and skills retention, especially of skills that are very special and scarce, are generated within these SOEs and also that black skills are retained in the SOEs. For this reason, we will keep an eye on the transformation agenda and the extent to which the SOEs help us to fulfil it.
In so far as Eskom and the energy regime are concerned, we do welcome the World Bank loan to Eskom, as the Minister said. If this loan was not forthcoming, we were going to have very serious tight margins of supply of electricity as early as 2011, and especially from 2012. We welcome this and hope that all South Africans will understand that it was absolutely necessary for government to act in this way and that government has acted very responsibly.
We also intend, however, as Parliament, to play an oversight role as regards the conditions that will be set in so far as this loan is concerned. We expect to have a conversation with our own Minister and the Minister of Finance when time allows. So, we keenly wait for government to indicate to us the right moment to discuss this issue and to put the fears of South Africans to rest. We know that the government has acted very responsibly in securing this loan; and we know that, in fact, we will pay very little or low interest on this loan. Thank you very much.
We welcome the Minister's review of remuneration packages. We want to remind members that there is a need to review SOEs, because the SOEs are straddling the space between the public sector and private sector by way of their being companies. They cannot pay or remunerate only in a manner that is in line with the market, because their sole function is to enhance the government in its objectives of economic growth and fulfilling its duties as a developmental state.
Therefore, we hope that in the next six months, both the Minister and the panel will come to Parliament to report to us about the findings and the recommendations of the panel on remuneration packages. We hope that we will cease to see exorbitant packages that are paid to management and boards that are not comparable to the actual conditions of South Africans in the country.
Insofar as deployment is concerned, a charge that has been levelled against us often, I want to submit that approximately 11 million people voted for the ANC in the last election. Now, it is very, very silly to expect none of the 11 million people to find a space in the economic sector of the country, including on the boards or as part of the management of SOEs. It would be very silly to say that once you associate yourself with the ruling party, you forfeit your constitutional rights to participate in the economy of the country.
ANC members, like any other South Africans, do have a right to sit on the boards of SOEs and to be part of the management of SOEs. However, there should be conditions for them to be there. Firstly, they should be competent and have the capability to sit on those boards and be part of management. Secondly, once they sit there, they must perform. They must perform according to the outlined mandates of those SOEs, and they must perform and perform and perform. Therefore, it is silly to say that once you are a card-carrying ANC member, or if you support or vote for the ANC, you have no right or have no place in the public sector or in the various sectors of the economy. [Applause.]
In terms of the infrastructure building programme announced by the President, there is an amount of R846 billion over three years. I would submit that we would be failing very badly as a developing country if we did not reorganise the regulatory framework, including the procurement regulations, to ensure that we use that infrastructure building programme to deracialise the economy - to share the cake amongst those who were previously disadvantaged in order to make sure that we use the infrastructure building programme to attract skills, transfer skills and apportion skills to those that historically did not have those skills.
In terms of the marginalised, we must make sure it will not be the giant multinationals, as has been the case in the past 16 years, that bid for and receive tenders for these building programmes, with the crumbs going to the BEE - black economic empowerment - companies. I think we need to review the space and the regulatory framework urgently to make sure that we draw lessons from the BEE efforts of the past 16 years in that, yes, they were not broad based enough. But in any life of any country this size, if one compares the size of the building programme to the size of the GDP, it would occur only in the next 100 years that we would be able to have that kind of giant building programme.
For that reason, we should move that building programme, by means of regulations and all that we have, into the hands of competent people who are largely black and African, who are historically poor and who have historically not benefitted from being part of the economic mainstream of the country. I thank you. [Applause.]