Forestry worker abuse: DAFF & Forest Sector Charter Council response; National Forests Amendment Bill: deliberations

Meeting report

Opening remarks
The Chairperson welcomed everyone. She noted apologies, including an apology from the Minister of Agriculture, Forestry and Fisheries, Minister Mr Senzeni Zokwana. She welcomed Dr Mahango, Chairperson of the Forest Sector Charter Council and invited him to present his report
.
Presentation by Forest Sector Charter Council (FSCC)
The Chairperson of the Forest Sector Charter Council (FSCC), Dr Diphoko Mahango said his presentation flowed from a November 2017 briefing to which the Portfolio Committee had invited the FSCC to report on transformation in the Forestry sector. At that time the industry was at level 4 with a scorecard of between 65 and 74 points. In terms of legislation, 74 points entitled a company to 100% procurement recognition. The FSCC also reported on complaints by some worker villages not having toilets; generally poor working conditions and people being treated “as slaves”. The FSCC was mandated to look into those matters and report back. Overall, a number of issues had been looked into and the FSCC was ready to brief the Committee.

Non-involvement of communities in forest issues
The FSCC was in the second phase of a community outreach programme which had been designed to engage communities to elicit relevant information. The outreach found that most of the companies were implementing some of the requirements of BBBEE. One issue raised by the communities was that the lease rental income derived from the use of their land was not adding value to their lives. Dr Mahango suggested that the relevant DAFF programme should be able to deal with that challenge. Further, funding for new small enterprises and land was inaccessible. In one instance in Richard’s Bay, community members could not use the land as it belonged to the Chief. Another concern was with the illegality of the chemical treatment of fence poles. Complaints around the transportation and storage of fresh produce at sidings was also raised by communities during the outreach programme.

Poor working and living conditions of workers in forest farms
To engage companies, the FSCC had decided that Dr Mahango should start with visits to the CEOs of all companies in the forestry sector to sensitise them about the above concerns and about BBBEE legislation. During those visits Dr Mahango had informed CEOs that the Committee was not happy about allegations of mistreatment of employees and communities. The FSCC visited three companies, namely South African Forestry Company Limited (SAFCOL), SAPPI and Khulani Timber. Although the FSCC had found the situation to be contrary to what had been reported, Dr Mahango said his delegation took pictures of workers’ housing and ablution structures and noted the number of black women workers. In consultation with DAFF officials, it was agreed that the Department of Labour be asked to send inspectors to the affected areas. Visits to other significant companies in the areas mentioned in the above allegations would be made before the end of June 2018.

Lack of enforcement measures resulting in non-compliance with BBBEE
Government should introduce guidelines, in line with sections 10 and 13A of the BBBEE Act as Amended, to enable the FSCC to force companies to comply with BBBEE stipulations. As things stood, the issuing of a “Certificate of Good Standing” as an enforcement mechanism was a competency of the Department of Trade and Industry. To achieve the desired results in the Forestry sector, there was a need for that competency to be extended to the FSCC. In the absence of that, companies would continue to defy the FSCC.

Poor performance on Ownership, Management Control and Skills Development
The FSCC visits had seen actual evidence of employee training and skills development programmes at all of the companies visited.

Poor participation of women in forestry.
The FSCC again had seen an improvement in black women ownership through BBBEE ownership deals involving trusts, where mostly women were the beneficiaries. The FSCC proposed that a women and youth academy be created from the revenue derived from levying the sector, to further address this matter.

Despite the above, Dr Mahango said his view was that the upcoming Status of Transformation report in August that year would see more companies “falling short” on compliance with BBBEE, because of the new amendments to the legislation. However, visits to companies in the sector would continue. Dr Mahango also brought to attention of the Committee, the challenges around poor intergovernmental cooperation as experienced by the FSCC, and, in particular, the non-response to requests for meetings by the Departments of Public Enterprises, Water and Sanitation, and Cooperative Government and Traditional Affairs. He appealed to the Committee and the DAFF to assist in that regard.

Discussion
 Mr H Kruger (DA) said it seemed to him as if Dr Mahango was washing his hands of the whole affair regarding the non-cooperative attitude of government Departments towards the forestry sector. He was interested in looking at Dr Mahango’s correspondence with those institutions. The empowerment of small businesses with land, financial support and other resources in the sector was very important. He wanted to hear more about how difficult it was for these small businesses to enter the sector. Government had spent more than R15 billion on small business development initiatives the previous year. So why was it difficult for small enterprises to operate in that space? If big business was the obstacle, then something would have to be done about it.

Mr P Maloyi (ANC) said Dr Mahango’s report was about an ongoing project, a work in progress, and therefore wanted to know when it would be completed. He explained that his question was an attempt to make sense of an apparent contradiction between Dr Mahango’s briefing and what the Committee had been told by members of the communities directly affected by the conditions described. He said he would not contest Dr Mahango’s report at the briefing, but would rather wait until it was concluded, after which he would propose that the Committee go back to the same areas, to confirm the final report. Mr Maloyi ‘s view was that somebody was not telling the truth, and although he had a problem with that, he was not accusing anyone just yet. He warned however that ”die poppe sal dans” (the dolls will dance, i.e. trouble is coming), once the Committee had carried out its verification exercise.

Mr Maloyi’s sentiments were echoed by Mr N Capa (ANC)  who confirmed that he had been part of the site visits and had seen, with his own eyes, what communities had been complaining of. His guess was that more visits would eventually corroborate the experience of the Committee.

Mr P Van Delan (DA) also expressed reservations about Dr Mahango’s briefing. Until the FSCC had visited all of the companies where the communities had complained, including the MTO Group which was one of the biggest, the report was incomplete indeed. How was it possible that communities that owned land on which entities were renting could fail to get paid? It did not make sense to him. Another complaint he had with the FSCC report was that instead of offering solutions, it presented problems.

Mr A Madella (ANC) agreed that the report was sorely lacking in scope, but he expressed support for Dr Mahango’s idea of a training academy for women and youth. That could be explored further by involving, not only the relevant Sector Education Training Authority, but also leveraging funding from the National Skills Authority.

In response, Dr Mahango said DAFF would deal with the matter of rental monies. He accepted that the report was incomplete and reiterated that visits would continue, including one to MTO. His own suspicion was that MTO was where the main problems could be found. MTO had been visited by the FSCC but, unfortunately, arrangements for a tour of the working and living conditions of the workers could not be made. Replying to the small business funding question, his view was that a good approach was through the Industrial Development Corporation’s (IDC) new venture creation concept. When going out to meet communities, the FSCC regularly invited the IDC along and entrepreneurs were encouraged to apply for funding. However, Dr Mahango said some of those businesses did not agree with the IDC’s terms and conditions.

Mr Kruger interjected, saying that perhaps the right institution for funding those businesses was not the IDC but the Small Enterprise Development Agency (SEDA). The latter was designed precisely for small businesses or start-ups while the IDC was targeted at bigger industrial scale businesses.

The Chairperson pointed out that one of the items on the agenda for the day was finalising the amendments to the National Forest Amendment Act, and therefore asked Dr Mahango to make an input as to how the FSCC could, legislatively speaking, be enabled to enforce BBBEE compliance in the sector. Was there an effective mechanism that could be written into law?

Dr Mahango replied that in his view, the use of sections 10 and 13A of the BBBEE Act would be the most effective way to ensure enforcement.

Regarding poor working conditions of workers, the Director-General of DAFF, Mr Mike Mlengana, said extensive talks between himself and his counterpart at the Department of Labour around an action plan to
to protect workers’ rights were at an advanced stage. The idea was to enable DAFF to enforce implementation of the statutes of the Department of Labour in the agricultural sector as opposed to merely playing a facilitating role. On funding of small and emerging businesses, he said that funding was available first through the Khula-Start Programme and also through Operation Phakisa, a joint initiative between DAFF and the Land Bank designed to support smallholding farmers. The challenge was that the intended beneficiaries were not aware of the existence of those financial support packages. It was therefore incumbent upon DAFF to ensure that the information cascaded down to the grassroots level where the beneficiaries were.

Before moving on to the next presentation, the Chairperson urged Dr Mahango to complete the investigation on working and living conditions and to come back with a full report the next time. She advised Dr Mahango to ensure that he obtained from the Committee, a list of all the companies implicated in allegations of abuse and illegality, and that, in future, he should stick to the list and exhaust it before going any further.

Department of Agriculture, Forestry and Fisheries presentation
Mr Mooketsa Ramasodi, Deputy Director-General (DDG): Agricultural Production, Health & Food Safety, DAFF, took the Committee through a presentation on another investigation by the Department regarding allegations of abuse and victimisation of workers and tenants by forestry companies. The issues raised ranged from non-compliance with labour law and FSCC stipulations, and non-participation of communities in the management of State forests. Outstanding worker pensions and shares was another area of contention.

Solutions/Actions
DAFF’s approach was to involve other government departments and the FSCC to assist in resolving the matters mentioned above. The Department of Labour, which was the most competent authority in the majority of the complaints, had made a commitment to investigate. A task team comprising DAFF, Department of Public Enterprises, SAFCOL, MTO, and the Western Cape Forestry Sector Forum had been established to deal with the alleged transgressions and, in particular, the workers’ pension pay-outs and shares. The Financial Sector Conduct Authority (FSCA) had been roped in as well.

Mr Ramasodi said the Department of Labour and FSCA  were the competent authorities to deal with labour-related matters and pension matters. Their involvement and interventions were sure to lead to effective resolution of the questions raised. He concluded by committing to making a full report available once the investigation had been completed.

Discussion
Ms M Chueu (ANC) said her impression of both reports from FSCC and DAFF was that the silo approach was still prevalent in government. Challenges raised by communities were parcelled out in terms of which Department was responsible for each matter. Ms Chueu reminded both DAFF and the FSCC that, as far as the communities were concerned, government was one, holistic entity. That was the idea behind the concept of Integrated Development Planning and other cooperative government initiatives. In addition, she expressed her displeasure at being treated as an “illiterate” and being fobbed off with “programmes” with no real time frames. There was also no detail and the whole thing seemed to be a box-ticking exercise. Ms Chueu said it was time for government to stop that narrow approach to service delivery.

The Chairperson agreed with Ms Chueu and recalled that the idea of former Local Government Minister, Sydney Mufamadi, intergovernmental cooperation had been implemented around 2005, yet the problem of working in isolation or passing the buck still dogged the public service. There was something seriously wrong with government, and this was particularly true at the DG level in departments. Was this perhaps caused by  the constant turnover and rotation of DGs in government? She again asked that the report-back meetings be strong on detail and give clear direction on what should be done going forward. Mr Ramasodi thanked the Committee for all the inputs and reassured the Committee that the final report would be of a high standard.

Mr Mlengana wished it to be recorded that talks were really ongoing between him and his counterparts in other departments. Perhaps it was not visible yet, but he assured the Committee that the issues had been taken seriously and the work was being done. He said all the DGs he had worked with were highly committed and were prepared for any sort of punishment for falling short of expectations. Contrary to what Committee Members might think, he and his colleagues did feel the pain behind the comments and questions.

Amendments to the National Forest Amendment Bill    
The Chairperson directed members to the document listing the proposed amendments and asked the 
Parliamentary Legal Advisor, Ms Phumelele Ngema, to lead the process clause by clause. She explained that due to a printing mishap, the enactment clause of the proposed Bill had not been printed and therefore members would have to formally adopt it, in addition to the rest of the proposed amendments.

Clause 1, dealing with the definition of “Board” was adopted.

Clause 3 was a great source of confusion and discussion around what was meant by, or the difference between, the terms “vegetation”, “forest” and “indigenous” and “natural forest”  Ms Chueu was concerned that the Bill should not unwittingly disadvantage communities living around protected forests and prevent them from harvesting firewood and other materials on which their livelihoods depended. Ms S Dzivhani, Deputy Director, DAFF said under specified conditions, legislation allowed communities to access forests for purposes of gathering firewood and other materials. The Chairperson proposed that, despite lingering uncertainty from Members, the clause be provisionally adopted, pending finalisation at a later meeting.

The Committee moved along until it came to Clause 15, when disagreement again came to the fore. The clause sought to amend section 57A of the Bill which dealt with the appeal process to be followed when appealing to the Minister about an action of DAFF. The proposal was to do away with the section altogether and replace it with an appeal board that would handle such appeals. The question then was whether such a board would be a permanent statutory body or only be  appointed on an ad hoc or need-to-have basis.
Ms Ngema asked the Committee to give direction as to which of these two options should be taken.

The Chairperson proposed that the appeal board be appointed when needed. Mr Van Delan said he was in agreement with the Chairperson. On the other hand, Mr Maloyi said his view was that the Minister be the sole appeal body but reserve the right to establish or appoint an advisory committee as he/she deemed fit. The Chairperson agreed with him. Mr Kruger then said if the Committee decided to reject the idea of a board then there was no need to consider the proposed amendment at all. Mr Maloyi suggested that Ms Ngema and her legal team go back and provide language which made it clear that the Minister would remain the sole appeal but could at his/her discretion appoint either a committee, or some structure, to assist him/her in a matter. Mr Van Delan said that meant that Clause 15 had not been entirely rejected and therefore the Committee could not pronounce it as rejected. The Chairperson replied that the legal team would go back and redraft the document for final adoption at a later meeting.

Another aspect of the clause that required the Committee’s direction concerned who might represent a person appearing before the board on a matter on  appeal. On personal representation during the appeal process, Ms Ngema said the proposal had left the question entirely open. A person could represent themselves or they could have anyone they chose to represent them, whether that person was a legal expert or not. But she asked the Committee to give direction as to whether to leave it like that or to introduce some kind of limitation or qualification. Ms Chueu suggested the former. Mr Kruger and Mr Capa expressed support, with Mr Capa only adding the qualification that when representation was other than the person concerned, the person representing should be a “competent” person. Members did not support the idea of a specific qualification.

In conclusion, the Chairperson said the exercise was very important, and to illustrate her point, she referred to the example of former President Kgalema Mothlanthe’s High Level Panel on the assessment of key legislation,  and how it had found that a number of laws passed by the Post-Apartheid Parliament had the unintended consequences of disadvantaging the very same people it had meant to empower. It was therefore important to be thorough and wide-ranging when engaged in law-making. She recapped, saying that all the relevant issues would be redrafted and presented again at a future Committee meeting for finalisation.

The meeting adjourned.