Public Enterprises International Relations and Rural Development Unit: briefing

Meeting report

PUBLIC ENTERPRISES PORTFOLIO COMMITTEE
5 June 2002
PUBLIC ENTERPRISES INTERNATIONAL RELATIONS AND RURAL DEVELOPMENT UNIT: BRIEFING

Chairperson: Mr BD Martins (ANC)

Documents handed out:
Briefing by Department of Public Enterprises International Relations and Rural Development Unit

SUMMARY
The Department briefed the Committee on how they are harnessing financial and technological resources for rural development initiatives. These initiatives are undertaken jointly by the Rural Development Unit, together with state owned enterprises. The presentation outlined Eskom and Transnet's contribution to rural development as well as the progress that the Unit and state owned enterprises have made. It was noted that they have been able to reach most of their targets. Their projected targets for the electrification of rural areas, to be reached by 2010, were noted.

MINUTES
Electrification of rural areas
Ms T Msibi sought to address issues around rural development. The chief areas of concern were the electrification of rural areas in a sustainable manner and infrastructure building. In 1994 only 35% of approximately 10.8 million households in SA were electrified. Between the years 1994 and end of 2001 a further 3.65 million households were electrified. Given the costs involved in the electrification initiative it became apparent that Eskom could no longer sustain the electrification initiative on its own. Consequently the electrification project was transferred from Eskom to the national government of South Africa. The Department of Minerals and Energy was charged with the responsibility of taking the project further. A national electrification fund was established to enable the Department to reached a goal of 100% electrification of households by 2010.

In outlining the progress that the Unit has made Ms Msibi indicated that they had in the year 2001/2 targeted 190 000 households for electrification and so far they have exceeded the target and electrified 206 000 households and 190 schools. Overall the Unit has electrified 70% of rural areas households. The Unit will look at ways to electrify the remaining 30% from now to 2010. By and large the electrification project has been quite successful.

Infrastructure Development and capacity enhancement
Another area touched upon by Ms Msibi was infrastructure development and capacity enhancement in rural areas. The major role players are various state owned enterprises (SOEs), Transnet and Eskom receiving greater attention. She indicated that Transnet sponsored projects are helping a great deal in unleashing industrial and related development in rural areas. The Committee was referred to the COEGA project in the Eastern Cape as an example.

She indicated that the Unit has some problems particularly around the rail network in the rural areas. Apparently some of the rail networks are not financial sustainable whereas some have already closed down. Ms Msibi indicated that the Department of Public Enterprises has agreed with labour that instead of engaging in wholesale restructuring on the networks a line by line analysis will be undertaken so as to ensure that the viability and sustainability of each line is assessed on its own merits. The number of jobs that might be lost in the process and the importance of various lines to the local communities largely influenced this. The Department was also concerned that wholesale restructuring might compromise the retention and increasing of traffic flow to the rural areas.

The Transnet Foundation has undertaken educational development in rural areas by among other things, infrastructure development. To this end it has allocated R10 million for infrastructure development. Five schools have been built in various provinces. An amount off R2.25 million has been allocated to capacity enhancement. The main focus is the training of both teachers and learners in mathematics and science. Some higher education institutions like the University of Zululand and University of Free State have received assistance in the form of a completion of a library and financial assistance to help retain teachers in the information technology programme respectively. Arivia.kom is also helping by training youths in information technology. It has identified a team of youths from Free State Province who will be taken to the organisation's offices for training.

Integrated Rural development Strategy
The Department and the Unit realised that a coalition with the SOEs and local communities was necessary for a meaningful development. Such a coalition was formed in 2001 and is currently engaged in a pilot project with Maliti-A-Phofung municipality in the Free State. One of the parties of this coalition is Arivia.kom, which agreed to train twenty youths in information technology.

Discussion
[ed. The following questions were asked in a cluster and answered together with the result that the questions marked with an * do not to appear to have been answered.]

Mr S Pheko (PAC) noted that this unit also deals with international relations. Where was their focus? Was it in Europe, Asia, etc?

Ms Msibi indicated that the Unit has a broad framework. However, the primary focus is on Africa. This is indicated by the Unit's own development initiatives like the West Africa Mission. The Unit works closely with SADC countries.

How long would the capacity building project in maths, science and technology take? Was it a short-term project?

Ms Msibi explained that the project is a long term one depending on sustainability.

Mr Pheko asked if the speaker could distinguish between rural nodes and rural areas, both of which are referred to in the document.

Ms Msibi explained that a node is a specified area in a rural area.

* Mr R Mohlala (ANC) commented that the unit should be commended for the initiatives that it has undertaken. However, is it not possible that since the Minister of Health is a nodal champion of the Free State some areas will not receive equal benefits?

* Mr Phekho asked if the Unit could show how much has been spent on rural development.

* Mr Mohlala noted that 35% of households had electricity in 1994. After that, 3.65 million households were electrified. What percentage does this figure represent? This was important to assess whether the rate of development is acceptable.

* Dr W Odendaal (NNP) asked who takes care of the maintenance of railroads?

Mr Mohlala noted that in their hand-out SANCO is listed as an SOE. Since when did it become an SOE?

Ms Msibi responded that SANCO is not an SOE as such but it was felt that it should be listed with SOEs since it is a fundamental player in the whole process.

An ANC Member noted that some youth would receive training from Arivia.kom. How would their communities benefit from the training?

Ms Msibi responded that the Unit is looking at how to ensure that the youth are brought back to help their communities. For instance it might be required that after training they should work for the local municipality for a period of time. The municipality might also be required to employ some of them depending on the availability of jobs.

The Member asked what the purpose is of giving out computers to schools without providing teachers?

Ms Msibi said it is not uncommon for this to happen. They have projects where SOEs provide infrastructure without training and those where training or human resources are provided. For example a local businessman may donate a sum of money towards the building of a clinic. However, on completion the clinic may not be functional since there is no electricity. This is where other government Departments must step in. The Transnet Skills Development project has allocated R750 000 for the training of teachers in maths, science and technology in the Free State. The Department of Education also has a big role to play in this regard.

With regard to the coalition structure, he asked whether it would be the same in all areas.

Ms Msibi said that the structure is not imposed on anyone because local participation has to be encouraged. Since different communities have different needs the needs will inform. For example in the Free State, discussions were held between the local communities before the coalition structure took shape.

The meeting was adjourned.