Date: 04/03/2010
Source: the Democratic Alliance
Title: DA: Rabie: Speech by the Shadow Minister of Economic Development, on the Division of Revenue Bill, Parliament

Mr Speaker, the Division of Revenue Bills is to provide for the revenue raised nationally among the national, provincial and local spheres of government for the 2010/11 financial year and to see that the money raised is spent by these spheres of government.

What is significant is that this Bill provides for the Money Bills Amendment procedures and Related Act No 9 of 2009 which empowers Parliament to amend the Government Budget and to oversee government actions and monitor spending.

What is also noteworthy is that this piece of legislation will be phased in over a period of three years. The Standing Committee on Appropriations and the Finance Committee met on a number of occasions to finalise the establishment of the Parliamentary Budget Director that will provide support to assist the Finance and Appropriations Committees to strengthen their legislative oversight. The DA supports the establishment of the Parliamentary Budget Office.

The 2010 budget and the Division of Revenue Bill must be seen in the light that 900,000 South Africans lost their jobs due to the economic recession, that only 12 million South Africans are permanently employed and that 14 million South Africans depend on some kind of government grant.

The recent escalation in the price of electricity of 24.8% and other inflationary factors may mean that within two years the number of South Africans that depend upon social grants increase to 16 million. Madam Speaker, the plight of poor and the needy cannot be left behind but it is also acknowledged that the very limited resources of government must be spent properly so that the benefits of the taxes flow through the system -- such as health care, education, municipal infrastructure and grants..

A submission to the Appropriations Committee the Financial Fiscal Commission said that an in depth review of the management of conditional grants is needed; it is an open question whether prudent spending and the intended objectives regarding the creation of jobs are attained by government agencies and parastatals. The DA will welcome a review and urges the Minister to intervene and to create the capacity so that proper performance audits can be conducted in dysfunctional entities.

Mr Speaker, National, Provincial and Social Governments globally do not grow the economy or create jobs. Businesses do that. But governments through their departments provide an enabling environment, or a disabling environment if the department is dysfunctional, which either encourages or discourages economic growth.

The task ahead is to alleviate employment which at the present rate of 26.5 is unacceptable. The DA calls upon the respective government departments to review our present rigid regulatory environment. The cost of doing business in a country is important - we need investment. It is said that it is possible to set up a company in less than three weeks in some parts of the world - Mr Speaker, if we want to alleviate poverty and unemployment, we must be able to compete with these economies if we want to attract sustained investment.

Mr Speaker, poor delivery of services is endemic to South Africa's largest parastatals. Telkom's service is expensive. Eskom's supply problems have cost the manufacturing and mining sectors millions, while Transnet's rail division inhibit growth in the mining industry. The Chamber of Mines has noted that the lack of rail infrastructure is a huge bottleneck for the development of our mineral resources.

The present system of management within these parastatals is not acceptable. Eskom and Transnet are at the present moment without permanent CEOs. What is further of concern is that Eskom has stated publicly that South Africa's electricity supply and demand situation will be tight by the end of this year. To bridge this difference it is important to involve all role players to take proactive steps to provide adequate services.