National Ports Authority Bill: final consideration and voting

Meeting report

PUBLIC SERVICES SELECT COMMITTEE (NCOP)
11 November 2003
NATIONAL PORTS AUTHORITY BILL: FINAL CONSIDERATION AND VOTING

Chairperson: Ms P Majodina (ANC)

Documents handed out:
Submissions on the National Ports Authority Bill and the NPA's role in the South African fishing industry
Department of Transport: Presentation to the National Council of Provinces, 17 September 2003
Select Committee on Public Services Proposed Programme: Fourth Term 2003 (Awaited)

SUMMARY
The Select Committee considered a late submission by Western Cape representatives of the fishing industry, deep-sea trawling and industrial fishing associations, as well as a response by Department officials (Maritime Transport), before finally voting on the Bill. At issue were the long-term viability and stability of the deep-sea fishing industry based wholly in ports (not fishing harbours) which was dependent on long-term leases and licences on the one hand, and the requirements of transformation and better safety for previously disadvantaged people on the other.
The Select Committee concluded that there was ample protection for the fishing industry inherent in the Bill. It was passed without amendments.

MINUTES
The Chair initially spent some time expounding on the frequency and seriousness of road accidents and on plans to address this situation. The meeting then concerned itself with discussion and voting on the National Ports Authority Bill that was due to be debated in Parliament on Thursday, 13 November 2003.

Mr Rory Williams (Chairperson of the Port of Cape Town Fishing Industry Association) submitted that they had never been consulted at any stage in the draughting of the NPA Bill, which was crucial to their port business. He was also representing the SA Deep Sea Trawling Industry Association (SADSTIA) and the South East Coast Industrial Fishing Association (SECIFA). Collectively, these three associations accounted for 80% of all fishing activities in South African ports.
They broadly supported the Bill but proposed amendments to two sections. Firstly, they felt Section 57 was very general and cumbersome. They suggested that a clause 56 (6) be inserted to exempt holders of existing long-term lease agreements from having to comply with clauses (2) and (5) which might entail having to obtain as many as 29 different licences for their operations.
Secondly, they felt that the requirements of the Marine Living Resources Act 18 of 1998 adequately covered transformation, safety, efficiency and effectiveness to which they were already complying. A new set of requirements would endanger the stability of the industry and not achieve what was intended by the Bill. that Section 67 should therefore not apply to long-term lease holders, and the aims could be achieved by inserting an additional clause 67(5).

Mr Mervyn Burton (Commercial Manager of Irvin and Johnson Limited, Cape Town Fishing/Processing Operations) explained in his slide presentation that commercial port activities were managed by the Department of Environmental Affairs and Tourism. With regards to black empowerment and transformation, he said that of the 2 500 rights holders, more than 60% were majority owned or managed by the previously disadvantaged.
Fishing harbours, as opposed to ports, employed 50% of the labour force and represented less than 40% of the value of the fishing industry. The large-scale fishing industry, which had R3.7 billion invested in big fishing vessels, had no choice but to use ports. The marine food industry was port-bound and represented a capital value of an estimated R2.7 billion of lease-held property in ports. Processing facilities had to be on the quayside. 11 of the total of 16 fishing harbours were in the Western Cape, and 85% of all commercial fishing was done in Western Cape waters.
Fishing harbours were congested because they had to be shared with recreation and tourism purposes, and were too shallow for vessels over 30m in length. Surplus capacity emerged in ports after containerisation was introduced in the 1970s and then deterioration and dilapidation were staved off by fishing industry investment.
Leases entered into with the various ports and the V&A Company were largely subsequent to 1994. All of these agreements were market-related for fishing activities and incorporated five-yearly reviews to re-benchmark rentals. A major problem was Maydon Wharf in Durban. Recognising t leases would address many concerns.
Historically deep-sea fishing activities had occurred in Mossel Bay, Cape Town, Port Elizabeth and Durban. Fishing vessels generated many marine activities, necessarily on the quayside because turn-around time was so short. Passing of the new legislation could mean they would have to apply for up to 29 licenses to cover all the activities in which their industry engaged. They were asking for a special dispensation to the fishing industry for leases and licences, since it had no other sphere in which to conduct its operations.
They were particularly concerned by the long-term impact of the powers given to the Minister by the Bill.

The Chair appreciated their support for the Bill and then asked the Department of Transport to respond to the new proposals for Sections 56 and 57 in the Bill.

Mr V V Windvoël (ANC) said that Section 67 dealt with issues of transformation. He thought the proposal to render this section inapplicable to the fishing industry was questionable.

Mr Williams responded that they already had to comply with very stringent criteria for transformation in terms of ownership, management restructuring, employment, safety standards, etc. The larger business industry was streets ahead of the fishing industry outside of ports in terms of transformation. The Bill introduced another set of criteria by a different government department or ports authority, which was confusing and untidy.

Ms Trudie Broekmann (Irvin & Johnson Limited Legal Advisor) reiterated that the large fishing companies were already complying with transformation criteria and that the introduction of more criteria was confusing. A further concern was the possibility of the National Ports Authority deciding to change the use the quayside presently occupied by the fishing industry, eg to international tourist hotels, for much higher rental income.

Mr Dumisani Ntuli (National Department of Transport Director: Maritime Transport) responded that the Draft National Ports Authority Bill was published for comment in December 2002 and the government approached the country's major port users on the provisions of the Bill. There was a meeting at the CT Waterfront to which all interested parties were invited, and there had been a good turnout. On 17 January 2003, after all input from ports users had been considered, the National Ports Authority Bill was again published in the Government Gazette.
The process in the National Assembly was then entered and input from various stakeholders was received, including from the National Port Users Forum, which was identified as being representative of port users. There was no intention to exclude anybody. Submissions by organisations were considered on 24 June 2003 and there had been concensus that objections had been accommodated.
The fishing industry was regarded as legitimate port users, but not superior to any other port users, so they saw no justification for making special exceptions. The National Ports Authority would now have the right and capacity to manage land use in the national ports. Section 65(1) of the Bill provided protection for existing port users. Furthermore, Section 57(7)(a) showed the Authority could grant exemptions for license applications if certain conditions were met by a port user.
Regarding the submission on Section 67, it appeared that, whereas it was decided to move from Maydon Wharf to general provision, the proposal aiming to move from general provision to nothing. Only the Constitutional Court could decide on the constitutionality of the Bill that was debated at length during the committee stage, and concensus was reached to go for a general provision.
The key words under Section 67(a) were safety, efficiency and effectiveness.
Fishing activities were historically part of ports and would not be isolated. Section 67(1)(b) provided for negotiation if activities were not in line with requirements. There was no reason to be suspicious or fearful.
Section 67(1)(c) questioned whether the existing fishing industry was closed to historically disadvantaged groups. If so, through an oversight of those issues, corrective steps could be taken because transformation was not an event but a process. Further clauses of Section 67 provided ample allowance for protection in accordance with a reasonable process. The Bill conferred essential landlord functions on the Authority and there was no need for rephrasing or amending.

Adv. Maribolla Mphahlele (National Ports Authority Manager: Legal Services) pointed to the wording of Section 67(1)(a) which required improvement of "safety, efficiency AND (not OR) effectiveness" of operations. Those words had to be taken as a whole. There was sufficient provision made in the Bill to prevent arbitrary decisions. The principles of administrative justice would come into place whenever the Authority made arbitrary decisions and where existing rights were affected.

Mr Lucky Montana (Chief Director: Parliamentary Services and Stakeholder Liaison) explained that in the parliamentary process of the Department of Transport since the White Paper, there had been intensive debate about over-regulation, which was also raised by the oil industry. The outcome was that care was taken to ensure that the Bill did not impose new regulations over existing ones. The Bill, and Section 67 in particular, was taking things forward and not hindering the activities within the port system. He supported Mr Ntuli's recommendation that the Bill remained as it had been formulated.

Rev M Chabaku (ANC) suggested that the two parties meet and sort out the contention that the fishing industry had not been consulted. She was concerned that the big fishing companies were not eager to allow women to run companies. She felt that the Bill was very helpful, accommodating, and sensitive to those who had been excluded.

Mr Windvoël thanked the fishing industry delegation for their submission but felt that not much more debate should be allowed, and that the Committee should make a decision. He hoped that the make-up of their next delegation would show that they really supported transformation.

Mr M A Sulliman (ANC) felt that Ms Broekmann should be given an opportunity to raise her expressed concerns about wording.

Rev P Moatshe (ANC) could not understand the conflict about whether the fishing industry delegation had been consulted.

Mr Williams said that, although the Department of Transport considered the National Ports Users Forum as representative, it was in fact only a Durban- based forum and the fishing industry was largely based in the Western Cape. He admitted they should have perused the Government Gazettes but felt that they should also have been identified as port users along with the long list of other users consulted. He maintained that Section 57 was potentially troublesome. All they were asking was that their existing lease agreements be recognised because they were very detailed and comprehensive. The fishing industry was unique and required special treatment. There were 22 sectors in the fishing industry ranging from the deepsea industry to beach line fishermen. He was concerned about the definition of market-related rental mentioned in Section 67(1)(b) of the Bill because they were captive port users and could certainly not compete with for example, a multi-storey international hotel. This might cause problems in five to ten years time.

Ms Broekmann supported the proposal from Rev Chabaku and would chat with the officials of the Department of Transport after the meeting.
She thought Section 65(1) gave protection only for six months, whereas their industry required long-term protection. If, for example, they had to apply for as many as 29 licences, it might mean that their vessels could not return to sea, whereas the other port users who fell under the National Port Users Forum needed only one or two licences because they fulfilled only one or two functions.
Furthermore, Section 57(7)(a) which referred to another statutory body as contemplated in Section 11(3) brought no relief because they did not fall under any other statutory body. They remained concerned that their long-term leases were being over-regulated. The leases also needed to be extended at the end of the lease periods. Their two areas of concern were, firstly, possible new criteria for obtaining leases, and secondly, the basis for market-related rentals. The new criteria introduced by the Bill for improved safety, efficiency and effectiveness were not helpful for the fishing industry, because the running an hotel was inherently a much safer operation.

The Chair ruled that the issue of whether the fishing industry was part of the National Port Users Forum could not be discussed at the meeting. At present, some black and coloured workers were recruited from streetcorners and worked under dangerous circumstances with no employment protection.

Mr Ntuli pointed out that there were two instruments available to allow people to do business within ports i.e. agreement and licences. Agreements could be negotiated with the Authority as set out in Section 56(1), bearing in mind that there was a port development framework and plan which demarcated areas reserved for the fishing industry. In cases where there was no agreement, they were required to obtain a license from the Authority, as spelt out in Section 57(1).
The fishing industry needed to go thoroughly and positively through the provisions of the Act to identify opportunuties on how they could make sure that their interests were accounted for. He was satisfied that the Department and the process had indeed gone to great lengths to deal with every detail and potential problem.

The Chair encouraged the fishing industry delegation to interact with the Department and excused them from the meeting. Once the Bill had become the Act, there would still be possibilities for amendments.

The Chair declared that the requirements of transparent democracy had been met. The matter of access to port areas had been dealt with, andif transformation was not proceeding well, interventions had to be made.

Mr Sulliman proposed that the Select Committee support the Bill. He did not consider that the fishing industry had anything to fear from the Bill.

Dr P Nel (NNP) wanted to know whether the Minister could also issue regulations afterwards, and whether the concerns of the fishing industry be accommodated then without amending the Bill. The Department of Transport should sit around a table with them and sort out concerns.

Mr Windvoël referred to Section 11(3) that emphasised co-operative governance, which meant there was no question of over-regulating. Safety was paramount, as emerged from the Sea Search and Rescue Conference which Dr Nel attended. As far as market-related rentals were concerned, he could quote instances where people were paying R100 per month for a three or four bed-roomed house. They should not sensationalise the issue to say that advances were being made to kill the fishing industry. The real issues were to normalise and create greater access.

Mr Lucky Montana suggested that, during implementation of the Act, the Minister would have to interact continuously with the various stakeholders in giving assurances on matters of concern. The key objective was not to arbitrarily disrupt existing leases and activities that were taking place, but to ensure that there was continuity and a due process of licencing. He was satisfied that the Bill addressed most of the concerns. One could not consider this industry as being superior or inferior.

Adv. Mphahlele, on the question of regulation, referred members to Section 80, especially the catch-all clause 80(1)(j). The six-month period prescribed in Section 65(1) started only after the Minister had determined the date, not from the date of enactment.

Moved by Rev Chabaku and seconded by Mr Sulliman, the Committee unanimously passed the Bill without any amendments.

The Chair adjourned the meeting.