Hon members, the government's proposition is quite simple. They have run all of the state-owned entities, SOEs, into the ground. Those companies now need enormous bailouts just to stay afloat. But there is no more money for bailouts because debt is unsustainably high, taxes are maxed out, and we're running record deficits. Borrowing is expensive, with l0-year bond deals costing around 10%; which only makes the problem worse as interest payments climb. So what to do?
The government could do the hard work of fixing those entities. But that would require real leadership and real tough decisions. It would require confrontation with the unions, and an honest admission that the central dogma of state control has failed. Those things are just too difficult for the ANC to do.
So instead, this government has reached back in time and plucked a policy straight from the National Party apartheid government of the 1980s. When that apartheid government was in the final
phases of burying itself in the junk heap of history, PW Botha also told the country that pension funds needed to be patriotic.
And so we come back to the present, with the ANC's 2019 election manifesto promising to investigate a regime of so-called "prescribed assets". And this was confirmed by the President during question time in this House two weeks ago. After a mealy- mouthed obfuscation at first, and after being pressed by the Chief Whip and the Leader of the Opposition, he confirmed that prescribed assets is definitely on the way.
I could quote you the Hansard; but the President is so verbose and so slow in coming to the point, a little bit like his Presidency really, that you'll have to go read it for yourselves. [Laughter.]
The ANC is reduced to copying the desperate policies of a failing apartheid government. I ask you, how low have they fallen? Some may call that complete moral and political bankruptcy. You call it the "New Dawn". [Laughter.]
They may have euphemistically referred to prescribed assets, but let's be absolutely clear what we are talking about. They are proposing to force every pension fund, public and private, to lend money to the government and to the state-owned companies.
Now, normally, the interest rate should compensate the lender for the risk of extending the loan. But if the lender is forced by law to make the loan, then it is the borrower, in this case the state, who dictates the interest rate.
This means lower investment returns for hard working South Africans for the rest of their working lives, and smaller pensions for hard working South Africans when they retire.
I did a rough calculation. Assuming the government starts off taking 3% of pension funds, a number that has been bandied about by the ANC. A 35-year- old South African who is saving R2000 a month in their pension and who does so diligently until retirement, will lose Rl,4 million in savings.
So, let's cut the nonsense and call it what it is, pension theft! [Applause.] This government is proposing to steal from the pensions of hard working South Africans to pay for their mismanagement. And don't be persuaded for a minute by the argument that 3% is where it will stop. Once the principle is established that it's okay to steal, the quantum will just ratchet up year after year. [Applause.]
In fact, the DA warned in the debate over the amendment to section 25 - I clearly remember the Chief Whip of the Opposition making this warning - that you cannot compromise on the principle of private property ownership. Because when you undermine any property rights, you undermine all property rights, even your future pension.
I didn't even imagine at the time that this warning would come true so soon.
Stealing from people's future pensions is still theft, plain and simple, and should be fought by every South African who has diligently saved for their retirement.
Let the word go out that the ANC, the self-proclaimed vanguard of the working classes, is coming for the workers' pensions. And the government doesn't need to change any law to do this; it can be done with a simple regulation.
We, in the DA, believe that such a change would illegally and unconstitutionally deprive people of their own savings without their permission.
So, if the ANC does go ahead with this mad idea, we will table private members legislation to allow South Africans to withdraw their pensions without having to resign from their jobs. [Applause.] And our legislation will allow them to opt out of compulsory pension contributions.
If we didn't do this, you would see thousands of workers resigning from their jobs just to save their pensions. And government employees must not think that they are safe either. The state pays their salaries and guarantees their pensions, and then uses those pensions to buy government guaranteed debt in bankrupt SOEs.
All of those guarantees only last as long as there's money in the bank. When the money is gone, the guarantee is gone. And the defined benefit guarantee will be the first thing to go.
So, nurses, teachers, police officers, social workers, doctors, every public employee, should get behind the DA in fighting this theft of their pensions! [Applause.]
And this brings me to the trade unions. Where is Congress of SA Trade Unions, Cosatu, and its affiliates? Where are their representatives in this House? These unions haven't said a thing, and Cosatu has offered cautious 'in principle' support. Why are they not speaking for their members? Every member of these unions should ask what they pay their membership fees for. Does Cosatu represent their members to the ANC or do they represent the ANC to their members? Cosatu's slogan is "An injury to one is an injury to all". But this proposal is an injury to all and you have not mustered the voice to speak for even one.
But worse than the silence of many trade unions, is the sickening sycophancy of the asset management industry. Asset prescription is inimical to efficient capital allocation in the market. Yet these asset managers have shown that they are prepared to accept almost any outrage, so long as it is presented in a "New Dawn" wrapper. And so now we have the grotesque spectacle of asset prescription proudly endorsed by Colin Coleman of Goldman Sachs of all companies, Magda Wierzycka of Sygnia and Wayne McCurrie of First National Bank, FNB, Wealth.
Hon members, here again we have the alliance of big state, big unions and big business working together with no regard for the best interests of ordinary South Africans.
Only the DA is fighting for the working man and woman. Only the DA is protecting the family. Only the DA is creating work and growing the economy for jobseeker. [Applause.]
Let me tell the ANC now, you will not get to pilfer people's pensions without a fight. And we, in the DA, will lead the fight to stop this theft. Thank you. [Applause.]
Hon House Chair, hon Deputy President and hon members. In the recent past, our economy recorded higher growth accompanied by shedding jobs; this is a reality. This was a result of financialisation of our economy, which means engaging in speculative investment as opposed to investment in productive activity.
The ANC is not a reckless government [Interjections.] [Applause.] On the contrary, we are a caring government. We make an admission that our economy is not performing, it is in dire strain; that is an admission that each and every one of us here has to make. We will come back to this later but most importantly, is that we acknowledge the weakness but we do not end there. We have a duty to come with solutions and support the President's exploratory direction.
Hon Chair, let me remind hon Hill-Lewis because he doesn't walk the distance as he raises the issue of the apartheid era laws. [Interjections.] Intentionally, it's very useful ... it's useless because you're there. The issue prescribed assets is not a new issue in our country. You are right hon member. The Pension Funds Act of 1956 held prescribed assets levels to 75% for the Public Investment Corporation, PIC, and 33% for long- term insurers. These prescribed assets were to be invested in the debt of state- owned companies and government bonds.
At the height of the apartheid regime between 1956 and 1989, when South Africa was economically cut off from global financial markets, the regime put on the prescribed assets policy in order to stimulate domestic investment and, therefore, economic growth.
The industrialization and employment creation drive of the apartheid regime in the 1950s, 1960s and so on, spawned many enterprises to play an important role in the South African economy.
Your railways, harbours, Denel, Armscor, SA Airways, SAA, even the now disbanded nuclear programme. These enterprises did not only support the economy and provide jobs, but also provided generous benefits such as training, subsidised housing and employee benefits like pensions, health, disability and death benefits. These projects together with job reservation were instrumental in ending the white, especially Afrikaner, unemployment and poverty. The majority of the oppressed, however, remained uncatered for at the time. They provided a cadre of trained artisans and professionals for industry and the economy as a whole as well as entrepreneurs on whom the country still relied on. The question then is: Didn't these and other similar initiatives make prescribed assets worthwhile even if the investment return was constrained only to a few privileged?
Perhaps we should as well highlight some of the achievements of the Government Employee Pension Fund, GEPF, through its investment wing the, PIC, to illustrate how investments by state institutions in the productive sectors can contribute to economic growth.
The GEPF report of 2018 record that investment grew by 8,3% during 2017-18 financial year. This was largely driven by allocations into domestic assets, particularly domestic bonds and equities.
The PIC on behalf of GEPF is investing in strategic sectors which will create jobs and economy growth. These investments include the Liquefied Petroleum GAS, LPG, import terminal in Saldanha Bay. This project presents an attractive investment for the GEPF, while also enabling the pension fund to play a role in job creation.
The PIC board - I will repeat this again - is now inclusive of the trade union movement because the government of the ANC is learning from past mistakes. [Interjections.]
During the reporting period, the pension fund's investments supported 538 small and medium-sized enterprises, SMEs, in sectors such as housing, energy, health, tourism and agriculture.
The GEPF invests in affordable housing infrastructure to contribute to the realization of the goals of the National Development Plan, NDP, while ensuring sustainable financial returns from its investments. Through its investments, the pension fund has also allocated 664 housing projects and 34 000 housing units.
Now, the ANC sponsors a developmental approach to transform our economy in which strategic state-owned enterprises should play a role in economic growth.
This debate by the DA raises a number of questions. One of the questions is: Whether this debate is an ideological debate in which the DA intends to convince us of its neo-liberal ideological stance which is not relevant to the South African economic challenges? [Interjections.] [Applause.]
The other question is: Whether the DA seeks to subject us to scarecrow tactics of sensationalizing what government is suggesting in our policy?
Given that the DA has not done so well in the recent elections, it will be expected that it will try all tactics in the book to gain lost ground. [Interjections.] [Laughter.]
To illustrate this scarecrow tactics of the DA, perhaps we should quote what Mr Hill-Lewis said on our policy proposal: "Asset prescription is an irresponsible and unacceptable policy proposal. It should be rejected by all South Africans." [Applause.]
It is perfectly obvious that our policy on prescribed assets will not be rejected by every South African because not every South African voted for you, hon Hill-Lewis. [Interjections.] The overwhelming South Africans have voted for the ANC while we proposed this policy to them.
Our conference resolution says that our government should introduce measures to ensure adequate financial resources are directed to developmental purposes. The resolution goes further to say that a new prescribed asset requirement should be investigated to ensure that a portion of all financial
institutions' funds be invested in public infrastructure, skills development and job creation.
In response to the question on the same subject of prescribed asset asked by Mr Maimane. The President responded by saying the issue of prescribed assets has been discussed over and over again, and in the end, we are going to pursue policies that are going to advance the interests of the majority of the people of South Africa. [Applause.] They have been oppressed for too long. We are going to advance the interests of pension fund holders, the very workers of this country who are members of trade unions.
For the first time I hear hon Hill-Lewis representing trade unions; it's laughable. [Interjections.]
Both the conference resolution and the response by the President are consistent with the character of the ANC, which is about the application of evidence-based policy implementation which requires that we should be guided by the realities on the ground
[Time expired.] We are turning the corner in favour of the people. [Applause.]
Hon House Chairperson, I think that we should perhaps take no one's approach and give a clear context of what this debate is all about. However, the size of retirement funds in South Africa is about R4,2 trillion, and about R1,8 trillion of that belongs to the Government Employees Pension Fund. The manner in which retirement funds are managed is through asset management companies. The biggest asset management company is a state-owned Public Investment Corporation, PIC. It is 100% owned by the state and it is the biggest asset manager in the continent. However, also, it is the best performing asset manager in the entire continent even compared to the privately- owned asset managers. It does better than Sanlam, Old Mutual, Coronation and Allan Gray asset management companies.
Therefore, you have got a state-owned asset management company that is performing far much better than the privately-owned asset management companies - and already the PIC is exposed to both government and parastatal bonds. I don't know what are we
debating if all of us know now that the PIC is exposed to government bonds, it invests in developmental projects. It has got private equity investments that it makes. Actually, the biggest danger of the PIC's investments is in the listed states with a recent loss of more than R20 billion through investments and Steinhoff.
I think that this is a nondebate really in terms of what the DA is portraying the issue and raising false alarms to cause panic. Now, the ANC says in its election manifesto that you are going to investigate the introduction of prescribed assets, but you do that in a broad and not clearly comprehensive developmental strategy and agenda. It becomes problematic when you just say that you want to investigate the introduction of prescribed assets without clearly defining under which developmental mandate and strategy do you want to introduce or investigate prescribed assets, because it must be located within the development agenda. What do you seek to achieve and when and how do you want to achieve that because the nonsensical proposal that is being brought by the Minister of Finance cannot fit
squarely into this prescribed asset agenda that it's mentioned in your own manifesto.
It is correct that for 33 years the apartheid government had prescribed assets, from 1956 to 1989, meaning that apartheid was anchored financially by pension funds. It was utilised to guarantee the jobs and the happiness of the white minority. So, there is absolutely nothing wrong that even if it properly located within a proper developmental programme, we should have prescribed assets in South Africa, but the approach would be nuance. I want to explain what should be done in terms of all of those issues.
One is that we need to consolidate all municipal pension funds. The 230 odd municipalities in South Africa have got different pension funds, majority of that managed by private pension fund managers. Therefore, those must be consolidated into one pension fund. We must then have a municipal employee's pension fund and then give an asset manager to then deal with the developmental investments of that pension fund which will have been consolidated - and, of course, deliberately focusing on
municipal infrastructure and other developmental impactful investments that must be looked into.
We should set a target - which we say in the EFF election manifesto - that must be 30% of all the pension funds must be invested in the productive job creating labour absorptive sectors of the economy and deliberately in private equity, because playing with the money of pension funds just in the stock markets without the job returns is wasteful. It is just bloating the stock exchange to more than 15 trillion market capitalisation, but there are no jobs out of that.
Therefore, we need to give a different direction in terms of what should happen. The nuance is that, the already existing PIC or the Government Employees Pension Fund, GEPF, exposure to government bonds should be converted into equity. We should introduce a new model of state ownership of these state-owned companies - meaning that you must have, of course, parts of government through the Ministry of Public Enterprises or other entities owning a portion. However, the PIC or the GEPF should own equity in state-owned companies such as Eskom and Transnet.
We then have a different approach to how we deal with these issues, but really there is no debate that is worthy of the sensationalism that the DA is introducing now, because already regulation 28 in the pension fund is already regulating the manner in which pension funds must be invested in which asset classes do we put these investments. Therefore, there is no debate that is even calling for the participation or the anger of workers as is being portrayed. It is just scarecrow which is fundamentally based on the racist distrust of a black management of common resources that must be managed. Thank you very much. [Time expired.] [Applause.]
Thank you very much, House Chairperson. It goes beyond me to think that today we rise to this podium to debate whether or not government should prescribe assets in South Africa. This debate speaks less of the subject matter but more of a fundamental question of whether government can and should be trusted with hard-earned pension savings of employees' funds to fund government's own social and economic development and failing state-owned entities, SOEs. The fact that we are even having this debate simply confirms what we have been saying
all along in this House that this government has dropped the ball.
It is shameful and indefensible that government with all the problems that it needs to sort-out first, now wishes to gamble with the public pension funds. Yet, we know very well that if government takes this money there is no guarantee. The IFP has repeatedly told this House and in committees challenged, begging the chief executive officers, CEOs, and their boards that we are throwing money at problems which are nonfinancial. This is the moral and ethical deficit that we are facing and this is our serious problem. If you place corrupt and questionable individuals at the helm of any organisation, you cannot expect miracles to happen. Confidence in this government right now is at an all-time low. How can it be trusted to make the right investment decisions on behalf of people? This does not bode well with the public service. This government is setting off our own alarm bells when it comes to managing the economy and finances of this country and stress later about credit ratings and scores of rating agencies. How can then it be trusted?
This government does not have a sense of crisis or urgency. It continues on the same trajectory leading into total disaster and then behaves as business as usual. How can it be trusted? We all know that this government is characterised by incompetence, corruption and, therefore, we cannot trust government to make the right investment decisions on behalf of our people. We have been down this road before, when the PIC wanted to take pension funds, we saw hordes of teachers and public servants taking early retirement packages out of fear. This on its own was showing that this idea is not welcome.
Today we wish to plead with the hon Minister of Finance and his colleagues in the economics cluster to abandon this proposal and restore confidence first before trying to get their hands on the pension kitty many have saved for so long to enjoy on their retirement. The majority of these people are not saving to enjoy their retirement, but to further fund and finance their grandchildren and great-grandchildren's education. Therefore, this is not the right way to take. Thank you very much. [Applause.]
Thank you, hon House Chair. The term unintended consequences come to mind. When government describes or defends the detrimental effects of certain policies we always hear that it's unintended consequences. I want to ask the ruling party to listen today and take the unintended consequences into effect now.
You see, many policies start with noble ideas but ignore the probable unintended consequences. Investment into developmental assets is critical to ignite social and economic development, and to create jobs. That's noble. Yet, learn from the past. The hon Abraham is absolutely correct. The National Party attempted to do exactly the same through prescription, but go and look at what the long-term effect thereof was. Go and look at what the state of the Government Employees Pension Fund, GEPF, was in 1994 as a result thereof. Completely depleted.
You are going to gamble away the money of pensioners. Contrary to government's concerted efforts and the positive changes achieved do date through the retirement reform initiatives, prescription will result in a reduction of investment returns
and would leave members of pension funds poorer. The risk to investors in pension funds would be that they would have to increase their contributions, work longer and contribute longer due to the poor performance of their investments.
The main objective of prescription is that assets are prescribed because there isn't sufficient demand for them based on their investment merits. In other words, if assets had sufficient investment merits there would be no need to prescribe them. Government should rather then work on the restructuring of state-owned entities, SOEs, than to prescribe assets. Why are our SOEs in the state that they are in?
Afrikaans:
Staatsentiteite is leeg gesteel en totaal en al wanbestuur. Die korrup het ons staatsentiteite leeg geplunder. Ek is doodseker dat die lede aan my regterkant en sekere ander lede in die Huis wat 'n affiniteit vir rooi het, slyp hul tande en slaan hul hande bymekaar, en sien dollar tekens wanneer ons praat oor voorgeskrewe beleggings, want hulle is seker dat hulle sien hoeveel meer miljarde daar gaan wees om te steel en te plunder.
Agb Abraham moet kennis neem met die feit dat dit die armste mense in Suid- Afrika is wat die meeste gaan ly as hierdie beleid van die ANC deurgevoer gaan word. Dit is die mees ondeurdagte beleidsrigting. Ek verstaan nie die agb Abraham nie. Wil sy soos die apartheidsregering wees? Wil sy soos die Nasionale Party wees? Want dit lyk my so.
Geskiedenis herhaal homself altyd. Die ANC raak al hoe meer soos die Nasionale Party; al hoe meer, met hulle geheimhouding, met hulle korrupsie en met die manier waarop hulle die land bestuur. U het geleer van die beste maar u gaan dieselfde pad as die Nasionale Party loop. U gaan ook mag verloor en u moet baie mooi na u eie profesie in hierdie Huis luister. U gaan u mag verloor agb Abraham, want die Nasionale Party het die mense se geld ... weg ... weg. [Tussenwerpsels.] Die mense se geld is weg. Die mense se geld gaan weer weg wees. U mag gaan weg wees. [Applous.]
Thank you, House Chair. I never thought the day would come when I stand or sit in this House and hear the ANC and the EFF extol the virtues of National Party policy from the
1960s to 1989. In fact, I barely see anyone from the Economics Cluster here. I mean, they are running for cover. Where are they hiding from this debate today? I don't understand it. However, what I find even more amazing is how the ANC is able to use code words to couch some very, very bad ideas. For example, we were once told that a private swimming pool constructed for the use of the ex-President was a fire pool. Now this cover- up did no damage to the political careers of those involved. In fact, Minister fire pool is now the Minister of Labour. The ANC's capacity for irony knows few limits.
The code word for today is prescribed assets, and as hon Hill- Lewis pointed out, it is not actually this innocuous thing. It is the theft of pension funds; money that people work and save their entire lives for in the hopes that they can sustain themselves and cover their costs in their retirement. Yet you want to raid this money in order to pay for the damage that you've done to the country's finances and to its SOEs. [Applause.]
Now, the ANC speaker said that the ANC is not a reckless government, yet when you look at the debt levels of SOEs and government guarantees of nearly a trillion rand, that is reckless. That was reckless! There is no other way to describe it. Just watch five minutes of the Zondo commission. I challenge any ANC member to spend five minutes watching the Zondo commission ...
Why?
... to understand how reckless you are in government. That's why! [Applause.]
Today, Eskom produces less electricity than it did a decade ago. Yet, this ANC wants to raid pension funds because they paid its management bonuses in this time and bloated its staff structure. The next time I see an ANC MP canvassing a school teacher for a vote, please tell that school teacher that you're taking their pension fund because you bankrupted Eskom.
Today, SA Airways, SAA, runs fewer routes and flights than ever before, including profitable routes like Johannesburg to London and Johannesburg to Cape Town, but it is in need of a bailout. The next time you canvas a police officer for a vote, admit that you're taking his or her pension because you appointed Zuma's friend, Dudu Myeni, to destroy the SAA. [Applause.]
The SA Broadcasting Corporation, SABC, generates less revenue than ever before because you allowed Hlaudi Motsoeneng - well, looking at his testimony at the Zondo commission ... Cloudy with a Chance of Meatballs - to destroy it. The next time an ANC MP canvasses a nurse for a vote, please admit to him or her that you are raiding their pension fund because you let Hlaudi destroy the SABC.
Hon Hill-Lewis made the point that many of these ANC MPs before us grew up in the trade union movement and now that they have their parliamentary pension funds and top-up guarantees they don't need to worry about the impact of prescribed assets, unlike ordinary South Africans for whom lower returns will
determine if they can afford bread or not in their retirement. For shame, you have forgotten where you have come from!
Legalising the theft of pension funds shouldn't be on the table and even if comfortable millionaire managers go onto Twitter and say prescribed assets, just because they are millionaires who run asset management companies it doesn't mean they are interested in ordinary people.
So, I say to my fellow South Africans today, if your fund manager says prescribed assets are okay, run for the hills. Move your funds to a manager who cares about whether or not you can retire with dignity. [Applause.]
However, there is an alternative to all of this. It's called growth. Some ANC MPs will be familiar with the term growth. You put it on your posters and billboards. Let's grow South Africa together. Remember that? It was a few months ago. Maybe you remember it. That was your promise.
Growth will lead to more tax revenue that will quench the ANC's insatiable thirst for spending other people's money. Growth will allow enough revenue to sort out the SOEs and government debt. Most importantly, growth will pull millions of people out of poverty and reduce the burden on government services.
However, legalising the theft of pension funds is not the way out of the mess the ANC has created. The National Treasury has proposed a growth- orientated economic strategy document that not a single ANC MP has stood up for or defended in this House. With a handful of tweets, this document is a blueprint to do what the ANC promised - grow South Africa. It's a pity that these ANC benches, and back at Luthuli House, are filled and populated with enemies of growth. You'd think after a lost decade that the pursuit of growth would sit at the core of solving our problems in this country. Growth can restore people's dignity through jobs. Growth can restore the health of our fiscus and help our ailing SOEs.
So, I say to the ANC, stop trying to steal pension funds. Just do what you promised. Grow South Africa. We'll help you do it.
We'll join you. We'll grow South Africa together but follow through on your core promise. [Applause.]
House Chair, the ACDP shares concerns about prescribed assets, and it is deeply ironic that one of the pillars of the apartheid regime could be making a spectacular comeback.
However, it is being sold with a different kind of rhetoric that financial institutions are not doing enough for the developmental state and that they are chasing short-term returns on the Johannesburg Stock Exchange, JSE, and overseas markets instead of investing in long-term infrastructure.
However, one must remember that the money invested in pension funds, whether in the public or private sphere, belongs to ordinary workers who are saving for their retirement - those policemen, teachers, nurses, social workers. They need maximum returns on investment with a minimum risk. Behind every rand invested there is a South African pensioner, a South African worker.
The regime of prescribed assets, as indicated by previous speakers, requiring investors to invest in specified assets, runs a high risk of poor investment returns. The reason for this is that the most likely form of prescription would be to force pension funds ... At the moment it's a choice where you buy. It's a choice for the Public Investment Corporation, PIC, to buy certain bonds. This is an obligatory form to invest a portion of their assets in a predictable list of broken down SOEs such as Eskom, SA National Roads Agency Limited, Sanral, SAA.
We know the remaining defined benefit funds such as the GEPF cannot absorb lower investment returns. This has a negative impact on those pensioners. Just ask the Transnet pensioners. It is estimated that the vast majority of pensioners that are on defined pension funds could have up to a 14% reduction in their pensions should prescribed assets result in compulsory funding of dysfunctional SOEs. This is totally unacceptable and I'm sure that the trade unions, once they grasp the enormity of this, will be opposing this move as well.
We have witnessed widespread looting and plundering of SOEs. Many of us in this Parliament were involved in the Eskom inquiry. We saw the corruption and the state capture. This has resulted in the precarious financial state of these SOEs. Now, for example the new chief executive officer, CEO, of Business Leadership, Ms Mavuso, said you can't steal so much money and think you are going to come back and say, to fix the mess in the SOEs that you have created over 10 years, we are now going to take your pension fund. It is not right. We in the ACDP agree with this position.
We have to protect our pension funds and the trust deficit still has to be restored, and we cannot allow, what other speakers have said is, a theft of pension funds through prescribed assets. The ACDP agrees. [Applause.]
Hon Chair, hon members, the debate about prescribed needs sober minds and honesty. South Africa is a developmental state and therefore in whatever we do, there needs to be a golden trend to keep us in focus. The detractors of
prescribed assets are not only dishonest but are selfish and myopic in their approach.
It is absurd that the funds of South Africans are only deployed in assets that benefit only the rich and affluent. A responsible asset approach will be one which takes into account returns in investment risks. We are not saying plough money into the drain. We are saying that, there are certain developmental projects such as the building of universities, schools, setting up advancement of agricultural development as well rural infrastructure.
The capitalists in the country are not interested in these projects because the biggest beneficiaries are the majority South Africans who are black. In fact, to argue against prescribed assets has a racist element in it. The ATM supports prescribed assets within a prudent fund disbursement into developmental projects. Thank you.
Hon House Chair, I am actually shocked, seating there and hearing some of my colleagues say that the
Public Investment Corporation, PIC is one of the greatest things that has happened investments in Africa, I am actually shocked if you look at the dismal performance over the last couple of years and their the disastrous investments of people's monies. Again, the question is: What is the intention when you make such statements? Are you putting yourself first because you are going to personally benefit from these things, like the VBS Mutual Bank? Is that what it is all about, or is it protecting the funds those people that have worked for centuries? I think that is the question that we should be asking.
The EFF should be the last one to come to this podium and talk about investment of the poorest of the poor because you are the biggest looters of the poorest of the poor. [Interjections]
Order, order hon members.
Yes indeed, I think it would have been a great idea to take the investment of our pensioners and put it into development so that it could boost the economy in South Africa. The question that we need to ask is, with the state of
our state-owned entities, right now, with every other government department that is experiencing similar challenges in terms of management, can we trust those to take the funds of our pensioners and give it to them? Clearly the answer is, no.
Until such time that we get our house in order and are able to manage our affairs better, I think we should live the funds alone and not go anywhere near them. Clearly we are not in a position at this stage to manage them, satisfactory so that our people will benefit from that. We know and we understand what has happened particularly with the investment form the municipalities in the VBS Mutual Bank. My friend here were taking those monies and going to buy the best, going to Gucci, Armani, here and there, going everywhere. [Interjections] Is that what they are going to do with the pensioners' money? So really, I think we must be honest about this.
Order, order hon members.
Whilst the idea might have been good, the timing is clearly wrong. The timing is not now. We need to get
our house in order. We need to ensure that our state owned enterprises, SOEs are profitable. We need to ensure that when you take those pension funds and invest them, there will be a positive return for those people that have worked tens of years that are waiting to retire on those monies. Thank you very much. [Applause]
Hon Chairperson, when the ANC at its 54th National Conference, adopted the resolution on investment and allocation of resource, it was reaffirming a long standing view debated in the early 1990s, that financial resource needs to be invested in prescribed assets for developmental purposes. These developmental purposes were defined as investment in public infrastructure, skills development, and job creation.
True to the traditions and character of the ANC, it resolved to investigate this. I think you must underline that hon Hill- Lewis. To investigate this so that the modality of investment in prescribed assets is based on the balance of evidence. Balance of evidence, international practice, particularly in developing countries and the understanding support and trust of
stakeholders, underline that again. Hence, we are saying we are going to take a view that we need to consult, consultation process that is going to take all these particular factors into consideration.
The answer to the question that was raised by Shivambu to say maybe the view is too broad, it does not specify as to what the intention is. The intention is that we seek to grow the economy and address the triple challenges of poverty, unemployment and inequality.
The special role of retirement funds in investments, both in terms of the share of the retirement funds in financial assets especially Johannesburg Stock Exchange, JSE, bonds and the investment of retirement funds have got to be debated.
What we are addressing is that we have a sluggish economic growth and a rate of investment that does not match the needs of the country. This has to be addressed and in doing this the risk profile has to be developed and will be taken into account out of the experience we have.
The good thing we do as the ANC is that we acknowledge that there are challenges, we are not burying our heads in the sand. We acknowledge that there are challenges that the economy is not growing as expected therefore, because we have the responsibility to lead, we are bringing an intervention to say how do we then out of the current situation grow the economy and address the triple challenges of unemployment, poverty and inequality.
The difference between us and the DA is that we have the responsibility to govern whereas the DA has the responsibility to oppose.
Retirement funds have a special role in modern economies. On one hand they provide a central source of financing for both listed companies and governments. On the other hand, workers own a relatively large share of retirement funds, both these factors mean that retirement funds have social responsibility that goes beyond normal fiduciary requirements for investments by investment managers.
The worry by the DA is that why are focusing on the returns to say the returns but not on growing the economy to say how do we grow the economy and how do we create job opportunities? So, we need to balance these as much we are looking at the issue of the returns but let's also look at the issue of growing the economy.
Taken together, the assets of public and private retirement funds were worth R3 trillion in 2017, which is equal to two thirds of the value of the whole economy. Retirement funds now hold 11% of all company shares up from 6% in 1994.The public funds managed by the Public Investment Corporation, PIC, alone account for 8% in JSE capitalisation. Twenty five years ago, the figure was just 1% with a fall due mostly to a change in regulations and the PIC's investment strategy. Now, despite the PIC's move into the JSE, retirement funds owned 30% of all public bonds in 2017 downed from 40% 1994.
Public sector pensions saw their share in the funding of our government and its agencies drop from almost a third to a fifth in the past 25 years. Now, the retirement fund's huge financial
holdings mean that their decisions have a huge impact on the national economy.
Two thirds of the pensions and provident assets are owned by ordinary working people in the poorest of the 90% household, while the richest which is only 10% of the household own the remaining one third. But, for comparison the richest 10% own well over two thirds of all the other financial assets. So, how are we going to address these inequalities if the DA and other opposition parties are standing to say no don't invest in the economy, don't grow the economy, and don't address the inequalities. How are we going to do that?
It means you are comfortable with the status core. You are comfortable with the status core because under apartheid, you benefited from the very same prescribed asset.
Hon Wessels, it is not true to say the apartheid tried. No, they did not try; they did it for 33 years. I think hon Shivambu was explicit on that and for the first time I agree with hon Shivambu in this House. They did it for 33 years. So, you
benefited from the prescribed assets. So, you can't say apartheid government tried. No, they did for 33 years from 1956 to 1989.
Now, for workers, strong, sustained overall growth in the economy and employment is very important. For any pensioner, it is crucial that their children have jobs and they would accept the need for innovative investment to achieve that end. It is not true that pensioners are only worried about the returns to say what returns are; they are also worried about job creation because their children are unemployed. And they are looking at government for the government to provide solutions for job creation and growing the economy. So, it's not true that pensioners are only worried about their returns; they also worried about growing the economy and job creation.
Unlike richer investors with large personal assets, ordinary working class retirees depend on collaboration between their managers to secure sustained economic and social development. Only then can they truly enjoy the fruits of their working lives. We need to move to collaboration to boost investment in
infrastructure and the real economy so as to promote industrialisation, job creation and growth.
Collaboration in ensuring development investment has become particularly urgent in the past few years. The combination of job losses and the decline in the Gross Domestic Product, GDP, over the past two years only underscores the deep seated challenge faced by the South African economy.
This is part of a trend towards slower growth since 2015. We can understand this trend as a result of the conversions of international and domestic economic policy factors.
Internationally the end of the community boom in 2011 saw a sharp fall in the value of our mining export with prices dropping between 25% and 50% for platinum, gold, iron ore and coal. The results were a slow down in both mining and heavy industry in South Africa and across the region. That, in turn had a negative impact on our overall economy and especially manufacturing which depends primarily on the domestic and regional market
In the past, we have seen a slow down in growth in most of our main export market especially China, India and the European Union. Moreover the growing uncertainty around the United State, US, trade and foreign policy seems likely to aggravate international instability in the next few years.
We have to deal with the reality that the rules based regime for international trade has been overturned in favour of economic bullying by the most powerful economy in the world. Now, domestically on top of the global slow down, we have to grabble with the lingering implications of State Capture.
All these factors mean that we have no choice but to find innovative paths to grow and invest. None of us can afford to fall back into complaisance or hope to keep doing business the way we used to. Rather we need to identify new roads to building our economy, diversifying into new activities that can create employment, support new businesses and accelerate growth. That in turn means we have to find financial mechanisms that can mobilise all our national resources to build our economy.
IsiZulu:
USIHLALO WENDLU (Mnu M L D Ntombela): Lungu elihloniphekile kuyaye kuthiwe ongekho akekho nesisu sakhe kodwa ngoba naku usubuyile ne-Cope ayikho lapha eNdlini, sesizokufaka laphaya endaweni ye-Cope.
Hon Chairperson, I do apologise for that misbehaviour because I was called upon and then I was not in.
Patrick Cairns is a financial journalist for the Moneyweb. To use an oxymoron, Patrick's article in the Citizen a week ago about asset prescription is a dark light. He describes prescribed assets as the practice of government forcing pension funds to allocate a portion of their portfolios to speci?c investments, like government or parastatal bonds.
What Patrick doesn't say, however, is that asset prescription is regulated in our law. To be speci?c, Regulation 28 of the Pension Funds Act sets out the parameters for prescribing assets, and to whom they may be prescribed.
Not only is Regulation 28 granular about the parameters under which assets may be prescribed, it also makes it a requirement for a fund and its Board, before making a contractual commitment to invest in a third party managed asset or investing in an asset, to perform reasonable due diligence, taking into account risks relevant to the investment including, but not limited to credit, market and liquidity risks, as well as operational risk for assets not listed on an exchange.
The enormity of the responsibilities placed upon the Fund's Directors discredit fears about the investment returns from the state-owned enterprises, SOE's. Section 162 of the Company's Act allows errant directors to be declared delinquent. As a result, any attempt to prescribe assets will be done in a manner set out in the law.
We must never under appreciate the fact that, while SOE's have performed badly in the recent years, the possibility of prescribing assets to further socio-economic and infrastructure development remains un-impeachable. Our economy is stagnant,
with signs of depressive low growth, increasing expenditure and low revenue gains.
Unlike quantitative easing, the AIC supports the prescription of assets. We find it ironic that the people who are opposed to the prescription of assets, as an ideal socio-economic stimulus, are the cheerleaders of a sovereign wealth fund. Thank you
Hon House Chair, the correction by the hon Minister of Police just increases our thanks for the hospitality given by African countries by providing a home for those responsible for the freedoms we enjoy today in South Africa.
Zambia provided a home for freedom fighters to give berth there and the corrections help us to remember our unsung heroes.
Hon Hill-Lewis is indebted to you for bringing this matter to the nation's attention. [Interjections.] [Applause.]
Pension fund contribution should attract the best returns available on the market. However, Al-Jama-ah doesn't agree with
you that extending the basket of prescribed assets amount to theft.
Pensions will not have a quarrel that investments have a social, job creation and a universal health component whose benefit is greater than the slightly reduced returns.
Hon Lewis, you don't share with the House the checks and balances when it comes to investment choice and the involvement of employees in how their monies are invested. This however, needs to be strengthened in light of the warning that you have issued.
What is more worrying is that too many clipping fees reduce investment returns for pensioners and many people would argue that that is stolen by the captains of the industry. There should be no clipping fees.
Investment prescribed assets must only get pensioners contributions if next generation jobs can be clearly identified as a consequence of that investment.
Investments in prescribed assets must only be made if the prescribed assets generate new revenue streams. There must be a component in which pension funds benefit from a share of sales revenue and profit sharing before dividends are declared. I think that it is important that this matter has been brought to the attention of the nation.
Thank you House Chairperson, "state-owned entities, SOEs, pose a very serious risk to the fiscus," Finance Minister Tito Mboweni said. Allow me to quote from a section of the Budget Speech delivered earlier this year:
Funding requests for the SA Airways, SAA, the SA Broadcasting Corporation, SABC, Denel, Eskom and other financially challenged state- owned enterprises have increased, with several requesting state support just to continue operating. Isn't it about time the country asks the question: Do we still need these enterprises?
Mboweni asked the National Assembly. Indeed Minister, do we still need these enterprises?
Government guarantees to state companies are at more than
R450 billion, that's just over $36 billion; this is according to the National Treasury data. The state's exposure to this increased to 64,5% in the past fiscal year from 54,4% as companies drew in on their guarantees.
According to a statement made by the SA Reserve Bank, and I quote:
Financial stability centres on the ability of state-owned entities to rollover debt and achieve financial consolidation, should state-owned entities fail to roll over debt, the government would be liable and might not be able to honour such debt.
The Minister of Public Enterprises, Pravin Gordhan, announced in Parliament in June, this year that a lender would pay the remaining 15% of salaries, owing to Denel employees as Denel was only able to pay 85% of salaries to its staff that month. This is merely a temporary bandage for an entity that, quite frankly, is on the brink of collapse.
This unidentified lender is not a get-out-of-jail-free-card but a temporary reprieve.
Today, I sat in on the Standing Committee on Appropriations. The Chairperson of Eskom, Mr Jabu Mabuza, said something that I found astonishing. He said: "Pray for luck to keep the lights on." This is from an entity that has been hollowed out by state capture and wait for it, it has a debt of over R440 billion and counting. Now someone said to me one day; you know, we are so used to talking about billions that we forget the concept of how much a billion is. Well, to put it in context, if you started counting the seconds now, it would take you over 32 years to count to a billion; let that sink in.
South Africa has hundreds of SOEs, many of them are either completely dysfunctional, bankrupt, or frankly serve no purpose whatsoever other than the lining of the pockets of the connected few. Many of the hundreds of SOEs also duplicate functions and should simply not exist. They are sucking money from the fiscus and pose a great threat to the South African economy. From bailouts to guarantees; here is just a slight glimpse at the
frightening state of SOEs: the SAA's debt is R21,7 billion; Denel's debt is R3 billion with two bonds due in September totalling R2,7 billion; and Eskom's debt is R440,6l0 billion.
State-owned entities are archaic in their design and they should not be used for economic development, it simply does not work. The economy should be growing through supporting a free market system which gives South Africans a choice, which gives South Africans opportunity and would create a conducive environment for national and international investment.
When the money is finished, it is finished. It is very easy for billionaires to make bold statements that the Government Employee's Pension Fund is taxpayer's money anyway. Three and a half million South Africans have worked diligently their whole lives as civil servants and now face the risk of utter destitution in their old age because the government wants their pensions to bail out failing SOEs.
It is very easy to be a socialist with other people's money. It is very easy to have communist leanings when you have millions
of rands that you deal with are not your millions. The fact of the matter is this; it is our job to be the custodians of the South African coffers. Simple economies dictate that you cannot spend more than you have without dire consequences. You cannot grow an economy when you are held ransom by unions who cripple SOEs when they feel their demands are not met. You cannot grow the economy when your energy supply is not completely secure, and you cannot grow the economy by pouring billions and billions of rands into failing entities.
Now is not the time to throw money at the problem, now is the time to trim the fat. We cannot afford to continue with the status quo, where a government spends billions on bailing out SOEs instead of spending money on job creation initiatives and service delivery.
It is time to be pragmatic, and to stop playing politics. It is time to set political ideologies aside. State-owned entities represent some of the biggest monopolies in the South African economy, and by conducting a comprehensive review; government would be providing citizens with a clear indication that they
are willing to start the process of structural change to protect our economy from further financial losses.
We simply cannot be sentimental about SOEs. The country is in crisis, it therefore requires urgent reforms, and the absolute protection of pension funds. This is nothing more than the new potential state capture. Mark my words; this battle too shall be fought and shall be won. [Time expired.] [Applause.]
Hon House Chairperson, hon Ministers and Deputy Ministers present, hon members, fellow South Africans ...
IsiXhosa:
... molweni.
English:
Hon Wessels just in passing, I am sure your great-grand ancestors are angrily turning in their heads, turning, turning in their graves shame on you! [Laughter.] You can't come here rubbish and criticize the unions, you have written to them and they never listen to you because want to maintain the status
quo, it can't be like that. ACDP your fears are very much premature, just freeze them for now, we are still going to investigate, very carefully and also soberly so. All what you are saying DA, ACDP, and Freedom Plus is the "antism" syndrome, anti-developmental attitude, ant-job creation, anti- township development and village economic transformation and growth. All what you need to do is be shame on yourself.
The National Development Plan, NDP, identifies one of the structural weaknesses of the South African economy as the low level of savings and overreliance on foreign capital to finance our investments. The NDP points out correctly that dependence on external capital flows increases the risk of volatility in the domestic economy. In responding to the challenges of the NDP, which the DA supports by the way, the ANC has presented to the people of South Africa with its manifesto which the overwhelming majority have agreed by voting us back. Which we don't take that for granted; thank very much fellow South Africans.
In our manifestos we raise five issues, I will mention just a few: We will work tirelessly to increase the levels of
investments by R1,2 trillion over the next four years as part of our plan to grow the economy and create jobs. We are within our target. These investments will help diversify the economy in sectors like mining, forestry, manufacturing, telecommunications, transport, energy, water, agro processing consumer goods pharmaceuticals, infrastructure and financial services.
May I just then zoom in on the actual issue that the DA has got a challenge on; that we are saying we are going to investigate the introduction of prescribed assets on financial institutions' funds to unlock resources for investments in social and economic development. Mentioning a few to establish an Infrastructure Fund to finance key economic and infrastructure projects, informed by the ANC manifesto, which is a public document by the way.
The President has merely started a conversation on a public and private sector compact, to spur adequate growth and jobs for the benefit of all South Africans, but guess what the DA has decided to disrupt the momentum towards a national compact. The
important question to ask is; why? We are not going to be intimidated by you and retreat from our manifesto commitments, which were promised to fellow South Africans. The DA has long positioned itself as the shop steward of rent seekers.
Prescribed assets already exist by the way, it had been said before me, and it will continue it will stay, it will stay and it will exist. Fellow South Africans, South African Pension Funds are subject to prescription under Section 28 of the Pension Fund Act of 1956. These regulations are made to guide asset management to be done in a manner that also promotes social economic objectives that benefit the nation but at the same time protect the investors such as pensioners and workers, in the first instance. That limits us to equity of 75% by the way, listed property 25%, offshore assets 30% and hedge funds 10%.
The social compact requires a contribution from everyone. It will also need sacrifices and trade-offs that is why we going to investigate. It is upon the conduct of each and every one of us that the fate of all depends in. If we are to reinvigorate the
implementation of the NDP, we must cast our sights on the broadest of horizons, which the ANC is doing. The class conscious organised workers in our country have said that South African banks and capital markets have been on an investment strike for decades and, as a result, the productive and mass job creating sectors of the economy are in trouble. As we know, once the productive sectors of the economy shrink, real wages fall, leading to a fall in aggregate demand. Consequently, we witness economic stagnation, job losses and chronic shortfalls in the collection of revenue by the State.
If the State is unable to collect revenue on a scale that supports expenditure on provision of the social services, health, education, social grants, prescribed in Section 25 of the Bill of Rights, the consequence will be the crisis of social production we see not only in South Africa, but even the most developed capitalist countries such as the United States of America and Britain.
The DA is seeking to scare workers so that they do not act in their own interest. Allow me to remind the DA what the workers are; a progressive federation have done in the recent past.
IsiZulu:
Ubabhalelile, bakuziba, usunentukuthelo. Hhayi! Banelungelo. Bayazi ukuthi bameleni. Abazolalela wena.
English:
COSATU's intervention in the Edcon deal was in the spirit of social compact and nation building. Here a viable turnaround plan for Edcon was developed by Edcon in conjunction with the lenders, landlords and Unemployment Insurance Fund, UIF, that would both protect the 40 000 direct and 100 O00 indirect jobs but also ensure a turnaround for Edcon and a healthy return on investment to the depositors. That is why even in the Public Investment Corporation, PIC, the labour is going to be part it, moving forward. You will never hear the DA objecting to retirement funds being used to subsidise private capital. What the DA has a problem with, is the use of our savings to develop our economy, particularly our townships and villages.
Corporate lobbyists who operate freely in the US congress have been able to frustrate efforts by progressive law makers to pass legislation on universal health coverage - you will be quiet, you will listen to me at the end of the day - education and infrastructure. Fortunately, the DA in South Africa is making noise doesn't want to listen. The rent seekers, who do not produce anything, but are able to accumulate obscene levels of wealth as speculators in stock markets reject investments in infrastructure, public services an education, growth, and development in the township villages and rural areas. They do this because if our society invests in its own social and economic development, they will lose some of the capital with which they have been gambling.
The phenomenon of financialization of the economy by monopoly bankers coupled with the growing political power of investment fund managers, leads society to a form of Reverse Robin Hood affair moving money from the workers and the poor to the wealthy and well fed. Put differently, it is case of moving investment funds from the factory to the casino. As we know the logic of gambling, there are many losers and few winners. Who are the
losers, the majority of the fellow South Africans, the workers and the poor?
As the previous ANC speakers have said, the growth of the financial sector from number four in 1994 to the second largest sector in our economy has been accompanied by widening inequality and deepening poverty. One of the successes of Bantu education by your fore fathers was its ability to convince many of us that as black person, black people, black race we do not have to know what is done with our retirement savings, now we know. I wonder how many of us...Thank you House Chair. Just keep your motion! [Appluase.]
Hon House Chairperson, what joy it has been to see the ANC, the EFF corral together today not just with each other but with the party of apartheid. There must be some National Party gauleiters in their graves this afternoon. Listen to this debate here, getting support from the likes of EFF and the ANC, how wonderful irony is South African politics. I also forgot to we were dealing with an ANC proposal today, but of course there is party in this House with experience in stealing
pensioner's savings [Laughter.] So of course it was most wonderful to hear them speaking in the debate and telling us about their experience because of course when they see prescribed assets, they don't see R4 trillion in earned savings, the see a R4 trillion Venda Building Society, VBS. What a shine price that would be.
You know, hon Abrahams you completely confusing and contradictory, you listed a whole the long list of PIC project that have gone rather well. Well isn't the point? If the project were worthy of investment, they will attract investment by themselves, they don't need prescribed assets to force pension funds to invest in them, it's completely contradictory point [Applause.] Now, you always ask us for positive contributions and suggestions. Let me make one, let's do a pilot study on prescribed assets, let's do a pilot study with all of your pensions [Applause.] ...
Hon Hill-Lewis ...
We will do that for five minutes and ...
Thank hon member...
... if you like outcome we can talk about it [Applause.]
Hon members, order please, that concludes the debate on this subject. Can I get your attention, can I get your attention. On Thursday, 11 July 2019 - if you can all listen, I would really appreciate it. At the end of the mini plenary, I undertook to consider the Hansard and returned to the National Assembly with the ruling I have now considered. During the debate on Public Service and Administration Budget Vote 10, the hon Khawula rose on a point of order and said " Asinaye uRingo la, sino honourable Ringo", which means we do not have Ringo here, we have honourable Ringo. I then ruled that it was not a point of order as hon Maneli spoke admirably of the hon Madlingozi when he said:
At least as I was coming here, I was motivated because the ANC recognises talent of South Africans, there is an esteemed South African that I listen to his music, as I was coming here it was
very motivating. Of course that musician would be non other than Ringo. I like him 'so went hon Maneli' and like this song Shut the tears and grow.
Well I don't know that one; he makes the point that this thing will not just happen, he even quotes Biko that:
God is not in the habit of coming down to resolve our problems; in fact he goes further to sat that we teach the children not to take the freedom for granted.
Hon members after several further points order, I directed hon Maneli as follows: "Hon Maneli, if it happens that you refer to the name of a person, please respectfully do so". I now recognise that the point of order of hon Khawula was indeed a valid point of order, whether the hon member has a stage persona or is a celebrity who celebrity name is fondly raised by people who love and follow him, as honourable members, we should refer to each other in House and mini plenary sessions respectfully as directed by rule 82 (1).
You will also remember that the time I had indeed directed the hon Maneli to do so, I also recognised that hon Maneli offered the Madlingozi an apology, when resumed his speech. Therefore no further need to direct him in this particular regard. Thank you very much.
Order Chair, can you please clarify what is the judgement because...
Can you...
...you admit that he was referred to by his first name and it was wrong...
Can you come again hon Shivambu?
I want to understand what you have just delivered now, what is it, and what are you saying should happen? [Laughter.]
Ok thank you...
Yes.
I was making a ruling hon Shivambu on the basis of what I said in that particular mini plenary. In that particular mini plenary, I was said there was no point of order on what Makhawula had said, but I am therefore correcting it now, to say that hon Makhawula was correct in what she was saying, that's what I am saying.
In that case can you then get the member who did that...
Can I request you not to engage in a dialogue hon Shivambu.
... yes it's a point of order to say that as per the rule you must then instruct the member to stand up and apologize on what he did before, that is basic process.
Hon Shivambu...
...I understand you are new but that is how we work here.
Come again? What did you say hon Shivambu?
Chairperson, point of order.
What is it that you understand?
I said that I understand that you are a new presiding officer but the process of how we work here, is that we you have made a ruling...
Chairperson, point of order.
...you must then instruct the member who did wrong to correct himself here in the House it is part of process. That is how the rules are read, you can consult if you are not sure about it we will help you.
Thank you hon Shivambu, but please take it into consideration the fact of the matter that, I might be new but at times, it doesn't take time to get to understand very simple things like this one. I have made a ruling and that's how it's going to stand. It might be difficult for you to understand what I am saying, if you continue with that I am going to switch off your microphone.
I am raising a point of order; I am not even disrupting you...
I am not going prepared to take dialogue with.
... do not panic relax, we will guide you properly, now the process is that you must instruct the member to withdraw that is how it works...
Hon Shivambu could you please take your seat...
...that is how it works.
... could you please take your seat. That's how it works. Hon members shall we continue. Why are you rising on, hon member?
Hon House
Chairperson, just to correct what is happening in this House, the member on that day in mini plenary, apologised to hon Madlingozi, he apologised, so we thank you for your ruling and there is no need for us to debate it, here in this House now, because we know that a ruling of the presiding officer cannot be challenged when that is made. Thank you.
Thank you very much hon member.
Chair, on a point of order...
Why are you rising?
...if the member has apologised in the mini plenary as he was saying, why are you raising it now, here, because then the matter would have been settled? The ruling is, that member must stand up and apologise here and that is how we have worked all along in the fifth parliament, unless you are tell me that we are bending the rules...
Thank you very much.
...because it's hon Ringo and is an EFF member. Then I can call by name and apologise on the corner, if that is the case. Can we please follow the rules, to teeth? He didn't apologise we were there, he never apologised, we were there. We want the apology here.
Thank you hon members.
Hon House
Chairperson just to assist the House, the ruling is about the hon Maneli, is about the House Chairperson, who agreed on that day that the hon Khawula was out of order. So that is why the House Chairperson is clarifying for the mistake that he did on that day. Thank you.
Hon member, hon Shivambu.
House Chair, appreciating the fact that you are novice in these things, given an opportunity to revisit the same ruling that you have made, go and consult properly and then come, because I can tell you now that at the end of the day if the member has done something wrong and then point of order that was raised by hon Khawula was correct, then member must be instructed to apologise, here. If you are not satisfied with that, let us give you an opportunity, benefit of a doubt, we do
that with all new presiding officers, you will get to properly understand it later.
Hon members, we have to exhaust this thing now. It's not hon Maneli, who has to apologise, I am apologising on the basis of the ruling that I made not hon Maneli, however if members are not happy with the ruling that I have made, they know what processes to fall. You can take to the Speaker; the Speaker will refer it further, that how we close it. Thank you.
House Chair, then on record we are going to take it through the process.
I did not recognise hon Shivambu.
...but I spoke.
No, no.