President Cyril Ramaphosa replies to questions in the National Assembly

QUESTION 1 – PRESIDENT RAMAPHOSA ON GOVERNMENT’S MANAGEMENT OF THE ENERGY GENERATION GAP IN THE COUNTRY, AND THE PATH TOWARDS A JUST ENERGY TRANSITION

Honourable Members,

As I indicated in my reply to the State of the Nation Address debate on the 16th of February 2023, the Minister of Electricity will be responsible for overseeing all aspects of the electricity crisis response.

The Minister of Electricity is responsible for driving the various actions being coordinated by the National Energy Crisis Committee to end load shedding as a matter of urgency.

As I said then, matters of energy policy remain the responsibility of the Minister of Mineral Resources and Energy.

As for the issue of Parliamentary oversight of energy policy matters, Parliament is required in terms of the Constitution and its Rules to develop mechanisms to ensure that all executive organs of state in the national sphere of government are accountable to it and to maintain oversight of the exercise of national executive authority.

It is up to Parliament to decide how to exercise its oversight role with respect to matters within the jurisdiction of the Minister of Electricity.

The Minister is overseeing the full and speedy implementation of the Energy Action Plan to ensure that the severity and frequency of load shedding is reduced in the immediate term, and brought to an end within the shortest possible time.

Following his appointment, the Minister conducted a diagnostic assessment of Eskom's installed generation capacity, resulting in the identification of a set of critical interventions to maximise the energy availability factor of the generation fleet

The Ministry engaged a wide spectrum of stakeholders, including industry, labour, original equipment manufacturers and the diplomatic community who have all pledged their support for strategic interventions to reduce the intensity and frequency of load shedding.

The preoccupation of the Ministry is to improve the performance of the existing Eskom base load fleet, maximise the performance and output of peeking stations and reduce demand through an aggressive demand side management programme.

This work is being undertaken alongside measures to substantially and urgently increase the construction of new generation capacity. The reforms that we have already implemented has resulted in a significant increase in investment in new generation projects, with many more in the pipeline.

I thank you.

QUESTION 2 – PRESIDENT RAMAPHOSA ON TACKLING ALLEGED CORRUPTION WITHIN ESKOM

Honourable Members,

I have not been presented with any evidence of members of the Cabinet or other senior government officials alleged to be involved in corruption at Eskom.

Anyone who does have such evidence should provide that information to the relevant authorities so that a thorough investigation of all credible allegations may be conducted.

There are institutions whose job it is to investigate these matters as they have the legal mandate, personnel and capacity to do so.

Significant progress has been by law enforcement agencies, Eskom and the relevant government departments in addressing crime and corruption at the entity.

Various measures have been taken by the Department of Public Enterprises and reported to Parliament regarding the implementation of the recommendations of the State Capture Commission.

Coal supply agreements and construction contracts with a value of approximately R11 billion have been cancelled by Eskom. Eskom also initiated litigation that resulted in coal supply agreements to an approximate value of R3.7 billion being declared invalid. Further losses of approximately R10 billion to Eskom were prevented by setting aside other coal supply agreements and constructions contracts.

Eskom is pursuing claims with a value of approximately R4.8 billion against suppliers and former directors of Eskom. The utility has recovered approximately R2 billion unlawfully paid by Eskom to service providers.

The Special Investigating Unit has referred 5,464 matters to Eskom for disciplinary proceedings against employees for their alleged failure to submit financial declarations, declare or get approval for doing work outside of Eskom.

There are pending criminal cases or referrals to the National Prosecuting Authority by law enforcement in at least 125 instances and a further 65 referrals to the Asset Forfeiture Unit relating to Eskom.

At least 25 former senior executives at Eskom have been included in a database of individuals dismissed for their involvement in state capture and corruption at Eskom.

All this demonstrates that government is proactively investigating and taking action against crime and corruption at Eskom. The law enforcement agences will, in addition, continue to investigate any credible information that is provided to it.

I thank you.

QUESTION 3 – PRESIDENT RAMAPHOSA ON SOUTH AFRICA’S JUST ENERGY TRANSITION INVESTMENT PLAN PARTNERSHIP

Honourable Members,

The pledges made by the International Partners Group – comprising the United States, United Kingdom, France, Germany and the European Union – to support South Africa's Just Energy Transition with around $8.5 billion in financing is on track.

In 2022, South Africa formulated the Just Energy Transition Investment Plan, which sets out the scale of investment needed to meet the country's international carbon emissions reduction commitments.

The pledges made by the International Partners Group towards this investment are contained in this investment plan. These pledges consist of a combination of concessional and commercial loans, grants and guarantees. Work is underway to deploy these funds.

Financing under the Just Energy Transition Investment Plan will not be used for investment in coal-fired power generation. International climate financing is for investments that transition economies away from the use of fossil fuels.

The bulk of the financing is for the energy sector, including decommissioning, repurposing and repowering of identified coal power stations in line with South Africa's decommissioning schedule. It also includes support for new generation capacity, investments in the transmission grid and strengthening the distribution network.

Importantly, funds have been allocated to just transition interventions that will support vulnerable workers, reskill, train and provide new diversified economic opportunities and jobs for workers and communities affected by the transition.

I thank you.

QUESTION 4 – PRESIDENT CYRIL RAMAPHOSA ON THE COUNTRY’S MINERAL RESOURCES BENEFICIATION EFFORTS

Honourable Members,

Investment in geology is important for supporting development. The applications of geology span from minerals exploration, energy security, ground water security, early warning mechanisms for natural disasters, infrastructure development and optimal land use.

We have accordingly invested an additional amount of R335 million in recent years towards an integrated multi-disciplinary mapping strategy through the Council for Geoscience. An additional R813 million has been allocated towards furthering this development in the current MTEF cycle.

The information collected from this exercise is yielding desirable outcomes. For example, a massive rock type in the Northern Cape known as pegmatite has been characterised.

There is increasing demand for the minerals found in this rock type to fulfil the just energy transition commitments towards the greening the economy.

This mapping work is done in line with the exploration strategy that was approved by Cabinet last year.

As announced by the Minister of Finance in the 2020 Budget Speech, the National Treasury was exploring plans to establish a Sovereign Wealth Fund.

It was envisaged that the Sovereign Wealth Fund would provide an important tool for saving and investing in future generations, as well as have the potential to strengthen the country's fiscal framework.

The National Treasury intended to explore a variety of possible funding sources, such as the proceeds of spectrum allocation, petroleum, gas or minerals rights royalties, the sale of non-core state assets, future fiscal surpluses and savings.

However, the outbreak of the COVID-19 pandemic shortly after the 2020 Budget Speech meant that government having to reassess its priorities.

Due to the impact of the pandemic on the economy and the need for government to provide relief measures, the country has been running substantial fiscal deficits.

Since the 2023 Budget Statement the economic outlook has become more uncertain.

Any decision to move forward with a Sovereign Wealth Fund needs to take the current economic and fiscal situation into account. The establishment of a Sovereign Wealth Fund should be considered when fiscally affordable.

I thank you.

QUESTION 5 – PRESIDENT RAMAPHOSA ON THE COUNTRY’S EFFORTS TO FIGHT CORRUPTION AND TUCKLE ALLEGED ILLICIT FINANCIAL ACTIVITIES

Honourable Members,

The Government takes the allegations made in the Al Jazeera documentary titled ‘Gold Mafia’ very seriously.

We are committed to the preservation of the integrity of the financial system in the interest of the broader economy and ordinary citizens.

Investigative and regulatory authorities will act in accordance with their mandate, including in coordination with other jurisdictions where necessary to take action against those found guilty of wrongdoing.

With respect to actions currently being taken to investigate individuals who are alleged in the documentary to be criminally implicated, an enquiry has been registered by the Directorate for Priority Crime Investigation to investigate these syndicates and individuals.

This investigation is at an enquiry stage and no arrests have been made as yet. Details of the steps that are being taken cannot be divulged at this stage without compromising the investigation.

At the same time, Government is working with the Financial Action Task Force to implement an action plan to strengthen the country's efforts to counter money laundering and financing of terrorism.

The SAPS Detective Service is currently investigating several serious criminal cases that include money laundering as an offence.

The investigation of proceeds generated by serious crimes like fraud, corruption, tax-evasion, customs and excise and narcotics-related offices are also investigated across the South African Police Service.

Government will continue to combat corruption and money laundering in South Africa. It will do so both through strengthening its capability to investigate, prosecute and prevent illicit financial activities and thoroughly investigating specific allegations, such as those contained in the Al Jazeera documentary.

I thank you.

QUESTION 6 – PRESIDENT RAMAPHOSA ON EFFORTS TO ADDRESS WEAKNESSES AND ADDRESS CHALLENGES WITHIN THE SECURITY CLUSTER

Honourable Members,

Government's resolve to ensure the safety and security of South Africans is evident through, among other things, the significant increase in the resourcing of prosecutors and police as announced in the February Budget Speech.

This budget will assist in the recruitment of more than 10,000 new police officers to be deployed countrywide to fight crime and additional prosecutors to tackle complex cases of corruption.

To ensure that complex and high-level corruption cases are dealt with swiftly and efficiently, Special Commercial Crimes Courts have been established in all provinces and are being capacitated with technological tools to allow for virtual testimony and digital receipt of evidence.

A review of the anti-corruption architecture is near completion. The review will make proposals for enhancement of our institutional architecture, which includes the proposals for an effective agency to fight corruption.

Recent cases mentioned by the Honourable Member highlight weak border controls in our country. The establishment of the Border Management Agency, with border guards who have been given certain peace officer powers, will help to address the weaknesses in border controls.

Strengthening international cooperation with other countries, including mutual legal assistance and extradition matters, is a priority as we fight against all forms of transnational crimes.

The ability of the criminal justice system to respond to criminal activities needs to be complemented by long-term developmental strategies to prevent crimes from happening in the first place and increasing levels of safety in communities.

The Integrated Crime and Violence Prevention Strategy, which was adopted last year, recognises that the social and economic contributors to crime must be addressed collaboratively by all stakeholders. It also recognises that our response needs to be integrated and holistic.

The six pillars of the strategy are:

• firstly, an effective criminal justice system;• secondly, support to victims of crime;• thirdly, early social interventions to prevent crime and violence;• fourthly, effective and integrated service delivery;• fifthly, safety through environmental design and planning; and,• lastly, active public and community participation.

In putting this strategy into practice, the security cluster is working to improve the efficiency, responsiveness and professionalism of the criminal justice sector while mobilising communities and establishing strategic partnerships to reduce crime and violence.

I thank you.

Media enquiries:Vincent Magwenya, Spokesperson to the PresidentCell: 082 835 6315