Inter-Ministerial Committee on eradicating informal settlements in mining areas: Department of Human Settlements update; Limpopo Oversight Report

Meeting report

The Chairperson welcomed the accounting officer of the Department and officials. In the previous meeting it was proposed that the rectification progress report be compiled and brought to the Committee. The Department was still working on this report. Another proposal was for Gauteng province and its metro, in light of the report the Committee received, to appear before the Committee in the coming week.

The Department presented a progress report on mining towns. This was a key programme to not to the Portfolio Committee but also government at large.

Mr Thabane Zulu, Director General: the Department of Human Settlements, introduced the officials from the Presidency, the Department of Mineral Resources, the Department of Labour and the Housing Development Agency.

Special Presidential Package for Distressed Mining Communities
Mr Zulu painted a picture of what was happening in mining towns.
Mining towns were characterised by wide-scale informal settlements that were often located on tribal or privately owned land. Miners did not qualify for government housing subsidy programmes. Many mining companies had reached agreements with unions to pay a living out allowance, which was largely not used for decent housing and led to miners living in terrible conditions in backyards and informal settlements. Furthermore, miners were highly indebted.

Informal Settlement Upgrading projects were typically multi-year projects; there was a need to accommodate a diverse range of housing options. The overall objective of the intervention was “transformation of mining towns through creation of sustainable human settlements”.

Mr Mbulelo Tshangana, DDG: COO in the Department of Human Settlements, said in October 2012, the President signed a Social Accord with government, business and labour. This was referred to as the Special Presidential Package and made a number of commitments, which included addressing socio-economic challenges and restoring confidence in labour market solutions, addressing income inequalities and building social cohesion. Since then, a framework agreement had been developed as mandated by the President and the stakeholders were government, labour and the Business Chamber of Mines. The Framework Agreement was now led by the President, as per the June 2014 State of the Nation Address (SoNA).

IMC: Revitalization of Distresses Mining Communities
The Inter-Ministerial Committee (IMC) was established to address Part 3 of the Social Accord, addressing socio-economic challenges in mining districts and their labour sending areas. The IMC focused on:

• Integrated and sustainable human settlements – led by the Department of Human Settlements and supported by its entities.
• Improved socio-economic conditions – led by the Department of Cooperative Governance, Traditional Affairs, Rural Development and Land Reform and supported by the Departments of Trade and Industry, Economic Development, Treasury, and others.
• Improved working conditions of mine workers – led by the Department of Labour
• Decent living conditions for mine workers and meaningful contribution to the development trajectory of mining towns and labour sending areas - led by the Department of Mineral Resources (DMR).

15 mining areas in five provinces and their associated labour sending areas had been prioritised for the revitalisation of distressed mining communities. 12 labour sending areas in two provinces, the Eastern Cape and KwaZulu Natal, had been prioritised for the revitalisation of distressed mining communities.

The presentation tabulated the progress on the planning Informal Settlement Upgrading. The number of informal settlements within the identify municipalities was 136 and National Upgrading Support Programme (NUSP) priority informal settlements were 119. According to provinces’ business plans there were 87 projects, of which 52 were underway with 24 029 planned units and 8 197 completed units. A graph outlined how funds for the 15 prioritised mining towns were allocated. The contributors to these funds were government and mining companies.

Free State: Summary Matjhabeng
A total number of 48 projects totalling R146 045 445, to which government contributed R97 695 445 and the mining companies contributed R48 350 000.

Gauteng: Summary Westonaria, Randfontein, Mogale City, Merafong
A total of 71 projects amounting to R1.402 billion. Government contributed R1 212 190 184 and mining companies contributed R190 222 416

Limpopo Summary: Fetakgomo, Tubatse, Elias Motsoaledi
162 projects totalling R4 167 billion, government contributed R3 485 billion while mining companies contributed R681 893 084.

Mpumalanga Summary: Emalahleni, Steve Tshwete
62 projects recorded, government contributed R253.4 million and mining companies contributed R1 283.55 billion. There were 32 housing projects initiated by the Department, of these five did not have defined locations and there was no indication of budget allocation.

North West Summary: Rustenburg, Moses Kotane, Madibeng, Matlosana
10 recorded projects costing R4 186 billion. Government contributed R2 147 billion while mining companies contributed R2 039 billion.

Recommendations and conclusions
The Department asked the Portfolio Committee to provide relentless support to government initiatives and interventions whilst providing oversight on the distressed mining communities. The Presidency/DPME should continue to ensure alignment with other government departments in order to enhance Joint Programme Implementation. The Department ensured appropriate dedicated capacity focusing on the mining towns’ intervention. There were partnerships with mining companies and labour was encouraged in line with the Social Accord and Human Settlements Social Contract so that the mining companies matched government investment.

Discussion
Mr K Sithole (IFP) said though the President announced the programme, the contribution by mines was shocking. He asked about the capacity of the affected municipalities. When it came to projects, KwaZulu -Natal had none reported. Conditions in Mogale City were terrible though projects were started in 2005 and people were reallocated to be brought back in 2008, that had not happened and 11 people had died in shacks. Mr Sithole asked about the conditions in hostels, particularly in Mogale City.

The Chairperson added that the question asked by Mr Sithole on the contribution of the private sector was very important. The Committee needed to hear if the mines were contributing at their own whim and whether there were guidelines on how they contributed. This spoke to the relationship between government and the private sector regarding the programme.

Mr Tshangana said the matter with capacity had been picked up with the South African Local Government Association (SALGA) and the Department of Public Service and Administration (DPSA) where there was a partnership engagement to assist in supporting municipalities. He agreed that there were towns that should be included in the list, currently there were 22; the Department had discussed including more towns.  There were two or three towns in KwaZulu-Natal that were being deliberated on to be part of the list.

Mr S Gana (DA) was concerned that the projects were following where the mining activity was and had forgotten about the towns where mining ceased to exist. The programme was focusing on active mines and the people staying there were working, they were not poor people, they earned salaries and were given a living out allowance to ensure that they stayed in decent housing, that they were not using. This was a concern. How many of the units built as part of upgrading hostels did the miners not want to move into and stayed in informal settlements because they did not want pay rental fees? In the projects that government was working on were the miners willing to pay to reside in these “fancy houses”? There were reasons why the informal settlements were in the locations that they were; these areas were close to work, meaning there were no transport costs. Were these sites closer to work, if not, then the newly built houses would be abandoned for shacks again to avoid paying for transport.

The Chairperson said the essence of what Mr Gana was saying was about the amount of interaction between the miners, labour and unions regarding these programmes. It was important to look at the old mining towns (that built the economy of this country where the gold rush started) and the active towns now, and merge the past and present to ensure that ghost towns also benefited.

Mr Joel Raphela, DDG: DMR, said there was willingness to move into the upgraded structure, but certain issues had to be addressed first. These related to the availability of accommodation and challenges related to the indebtedness of some of the mineworkers. There was work, regulated through this project, to regulate micro lenders and getting mine workers out of debt.

Regarding ghost towns Mr Tshangana said in some cases there were initiatives by the provinces and cities to revitalise these towns – not all mining towns should be included in the Special Presidential Package. On the question of alternative accommodation, some mining companies had made land available for accommodating mineworkers. If it happened that land made available was out of the way from where people worked, mining companies had to make transport arrangements. What was important was the alignment of plans with all institutions involved.

Ms T Gqada (DA) asked about the unemployment rate in the areas that were identified, the presentation was not clear on how many job opportunities would be created by the interventions.

Ms T Baker (DA) asked what was happening in Mpumalanga, it seemed every report the Committee received there were no statistics for the province. She asked for the names of the informal settlements, not just numbers, so that there could be follow up.

Ms Baker questioned the reliability and accuracy of information in the report, for instance on the summary on Mpumalanga there were 61 informal settlements referred to – whereas there were actually 16 informal settlements in the province. She expressed concern with the inter-departmental relationships. When looking at services provided, when government built houses in a mining town (for instance, Sunway Village in Madibeng) there were no basic services, and they were only glorified informal settlements.

The Chairperson added that in the plans for informal settlement upgrading, when looking at Mpumalanga there were no categories for the identified settlements. The Committee needed to understand what was happening.

Mr Tshangana responded that all the 16 Mpumalanga informal settlements were NUSP and the Department had already sent its professionals to package a programme for them. The starting point in NUSP was to do a feasibility study on what was happening in the informal settlements. The next stage was to package the project and send in contractors. When the Department returned to the Committee on 18 March they would be able to report in detail on the settlements.

Ms Kailash Bhana, Chief Director in the Department of Performance Monitoring and Evaluation Secretariat of Mining Towns, said the Secretariat received figures from reports that were party of the Inter-Ministerial Committee and the Special Presidential Package. The Secretariat asked for projects that were at municipal level, together with dedicated financial contributions and timeframes. Sometimes there were gaps in the financial information both from mining companies and government. The presentation was an indication of the contribution overall, it was not an exact figure.

Mr Mpho Ndaba, Director of Mining Towns in the Department of Performance Monitoring and Evaluation, spoke on socio-economic development in mining town and the living out allowance. In respect to improving the socio-economic situation in mining towns, from the inception of the Special Presidential Package, what government, along with organised labour and businesses wanted to improve was coordinated planning and improved implementation. A number of projects had been rolled out to achieve integrated human settlements; and not building top structures in area where there was no core economic activity to maintain the economy of those areas. The Department of Human Settlement was not operating in isolation but with other government departments.

The living out allowance was decided on in a bargaining council with employee and employers. There were also interactions at National Economic Development Labour Council (NEDLAC) where the national minimum wage and the various aspects relating to industrial relations were discussed.

Mr N Capa (ANC) said there was no mention of labour unions in the process, but in the recommendations of the presentation it was mentioned that the involvement of labour was recommended. Were there any expectations that the Department hoped for by this recommendation or any issues as a result of this non-involvement of labour thus far.

Regarding the labour sending areas, how would ‘double-dipping’ be avoided – where people would benefit in the mining area and also in the labour sending area.

Mr Raphela said South Africa should have more sophisticated recruitment systems where there would be no reference to “labour sending areas”, but as a result of our history of the migrant labour system that was a great component of where we currently were. There was a study to understand working with social partners to gain a better understanding. In this package there were partnerships and unions were part of these, they were an integral part and component of the implementation of the programme. Unions were actively involved in the programme, as well as traditional leaders, government and the private sector.

Mr Tshangana said that there would be no double dipping, in the mining towns a criterion would have to be used that those who get their accommodation qualify for that unit. The criterion in mining towns was very strict. In the labour sending towns one would find that miners were taking out loans from the Rural Housing Loan Fund (RHLF) (and other government funding institutions) to renovate their houses. There was no double dipping and it was not foreseeable either.

Ms L Mnganga-Gcabashe (ANC) said it was only in Mpumalanga where the private sector had made a substantial contribution, were there any agreements in place on how contribution was structured. Whatever agreement or terms of reference, the private sector had to contribute more than the state; there could not be a situation where the state ran the private sector, it should be the other way around. The state should enable the private sector to have business in South Africa, and the private sector had to create more employment opportunities.

Ms Mnganga-Gcabashe said the interaction and the buy-in by miners was not clear in the presentation, the consultations with unions were reflected in the last slide. The problem was that mining companies were subsidising rentals for workers; it was built into their salaries. There was no question of miners not wanting to rent, however, to deal with that the labour unions had to be on board. It was clear rent was being subsidised but the employee also needed to contribute.

It was also not clear in the presentation that there was a team of liaison or facilitation people that were working before government came in and started developing projects; there was no sense of that in the presentation. This team would deal with daily social issues in preparation for these developments.

Regarding the guidelines when effecting socio-economic development, Mr Raphela said it was important to note that mines had a Social Labour Plan (SLP), which was a document that covered socio-economic interventions in areas where mines operated, as well as the industrial relations component that dealt with management of downscaling. With regard to socio-economic developments mines were contributing in areas they were operating in, as a result of the implementation of this Special Presidential Package – mines were in the progress of revising their SLPs to be in line with the needs. The Integrated Development Plans (IDPs) of Municipalities informed these plans.

The Presidential Package was not just intended to cover a certain category of towns; the plan was intended to address what was referred to as ghost towns but also deal with challenges in existing and stable mining areas and use those lessons from across all towns.

Mr Raphela added that linked to the Mining Charter (a document used to regulate the mining industry), mines were required by law to effect upgrades and conversion of hostels to single and family units. The consequence of that was that mines not only upgraded existing structures but developed settlements which mineworkers moved into. There was also converting of historically male hostels; and a host of other developments, arrangements, and agreements with unions that led to the payout of the living out allowance. The progress report to this programme would be released during the course of the year, as tasked to the Department, in line with the timelines of the charter.

Mr H Mmemezi (ANC) said the Committee needed to agree with the recommendations presented by the Department which included the importance of acknowledging the role of the President (and other stakeholders) in the project, ensuring that mining areas were not forgotten. He agreed that it was unacceptable for the mining sector to mine and then dump their labour for government to take care of. It was ungodly that mines thought they only took profits and money and leave people to government. Recognition was given to Mogale City being the largest mining area and the largest producer of uranium in the world [at some point] yet it was unacceptable that there were not indicated projects in the City. The ailments faced by these areas were a result of mining; they could not just be discarded in the programmes there had to be projects dedicated to these areas as well.

Mr Mmemezi said the adjusted expenditure was still not spent; only 18% of it was used, it was not acceptable and needed explanation. He looked forward to a model that catered for the different situations of miners and the towns they were in.

Mr Tshangana said Mogale City was part of the 22 towns and the project manager had verified that all informal settlements and hostels in Mogale City were included. The provision of accommodation for mine workers in mining towns was the responsibility of the mining companies, which was what the SLP was about; it came from an agreement between DMR and mining companies. Government was playing a role due to the number of informal settlements where people resided, not everyone would reside in the hostels and it was not an issue of not wanting to pay, in most instances it was the lack of availability of accommodation. For instance, LONMIN had 24 000 workers but could only accommodate 6 000 workers and others lived in informal settlements.

The Chairperson said the long-term objective was to deal with rapid urbanisation and rural development using this programme. This was why the Committee was referring to and asking about the old mining towns, and why there had to be a balance and not only deal with the distressed mining towns.

Mr Zulu thanked the Committee for the constructive engagement.

The Chairperson said the Committee required progress reports on the Package on a quarterly basis with a delegation from all the relevant departments involved. From one report to another the Committee needed to see progress.  Interaction with all stakeholders had to be tightened so that at a later stage there would be no reports of people not being happy with the projects. The Committee did not want protests around this programme due to lack of proper consultations and good relations with all parties.

Adoption of Minutes

Minutes dated 11 November 2014
Minutes of Committee meeting held on 11 October 2014 were adopted. Minutes were adopted without amendments.

Minutes dated 24 February 2015
Minutes of Committee meeting held on 24 February 2015 were adopted without amendments.

Minutes dated 3 March 2015
Minutes of Committee meeting held on 3 March 2015 were adopted without amendments.

Adoption of Draft Report on the Oversight Report to Limpopo
The Draft Report was adopted with grammatical amendments.

The meeting was adjourned.