Speech notes by Jane Cowley MPL, on the 2018/19 budget for Vote 9, Economic Development, Environmental Affairs and Tourism

Madam Speaker, Hon Premier, Honourable members of the House, officials, visitors in the gallery, I greet you all.

According to the International Monetary Fund (IMF), growth in advanced economies accelerated from 1.7 per cent to 2.3 per cent, while growth in emerging economies rose from 4.4 per cent to 4.7 per cent in 2017. Over the medium term, growth in developing economies, such as our own, is forecast to accelerate, reaching 5.0 per cent in 2019. This augurs well for our economic recovery.

The Bureau for Economic Research (BER) estimates that South Africa’s GDP growth is forecast to recover and accelerate to 1.4 per cent in 2018 and 1.9 per cent in 2019. However, given that the expected population growth rate is expected to outstrip GDP growth, GDP per capita will remain stagnant.

The South African economy expanded by 2.0 per cent quarter-on-quarter in the third quarter of 2017, mainly due to a 44.2 % increase in gross value added by primary sectors of agriculture, forestry and fishing – the biggest rise in 21 years. This growth is all directly linked to the environment.

Our Premier highlighted a number of key priority areas for growing the economy in our province, as part of the provincial economic development strategy. These include agriculture and agro-processing, the oceans economy, renewable energy, tourism and the auto industry. These sectors can, under suitable conditions, contribute significantly to the provincial fiscus.

No less than four of these sectors depend on, or directly form part of the environment, which we thus depend upon to grow the economy and create jobs. However, the provincial government ploughs almost nothing back into the protection of the environment and the promotion of biodiversity in the Eastern Cape. This becomes clear when we look at the budget.

Of a total provincial budget of R76,7 billion, the Department of Economic Development, Environmental Affairs and Tourism receives just R1,146 Billion. This is 1,49% of the provincial budget. From this, the Environmental Affairs portion is a paltry R319,8 million. This is 0,4% of the provincial budget. R207 million of this is then directed to the Eastern Cape Parks and Tourism, which manages just 2%of the land in the province.

Effectively then, the Environmental Affairs Directorate is left with R112 million, just 0,14% of the provincial budget,  with which to fulfil its mandate across the entire province outside of reserves – a mandate which includes environmental impact assessment, law enforcement, coastal management, biodiversity management and environmental education. This is a disgrace. The fact that the administration budget is more than twice the budget for the environmental mandate speaks volumes about where our provincial government’s priorities lie.

The decline in the environmental integrity of our province is there for all to see. Illegal sand mining, illegal off-take of threatened species in Marine Protected Areas, the illegal trade in rhino horn, donkey skins and cycads, are constant threats. While our environmental law enforcement officers do a remarkable job in curbing these activities and prosecuting perpetrators, there are simply not enough of them. Our national economic recovery last year was primary sector driven, which depends heavily on environmental health and management, but if we don’t invest in the environment at a provincial level, it will not yield the jobs that we hope for.

And, Madam Speaker, there are many potential jobs in the domain of the environment.  Waste to wealth projects, eradication of alien invasive plant species, alien by-product production, dry land biofuel production, pilots of which have been very successful in the province, “working for water” projects that are catered for in the national drought alleviation strategy, and many more. But we cannot expect our environment to magically produce required jobs if neither the biotic nor abiotic components thereof are being suitably managed and protected. Effective baseline governance of the environment needs to be established before one can address higher level issues such as climate change mitigation.

Madam Speaker, it is most concerning that our tourism figures for the past year seem to have declined. Not only has our province dropped down to fifth position out of nine in terms of visits to the province, but it was shocking to learn that the ECPTA no longer quantifies their occupancy rates within their reserves. According to them, most visitors to the province stay with family and relatives. They now choose to base their figures on activities done in the reserves, whether the visitors sleep in the reserves or not.

This is worrying, particularly as the province has invested large amounts of money over the years in upgrading accommodation. Reporting should not be adjusted to try to bolster perceived visitor numbers – they are either using the facilities or not. And if they are not, then we need to urgently and aggressively market our province both nationally and internationally, in order to fill beds.

Access roads to our reserves must be attended to, and it is pleasing to note that the roads to Dwesa and Hluleka are scheduled to be surfaced this year. We must also ensure the safety of our visitors, both local and foreign, at all times. I believe this can be done, provided we break down the siloist approach to tourism and job creation, and work inter-departmentally to achieve these goals. As tourists come back, jobs will grow.

Madam Speaker, we need to talk about our public entities. The entire budget for DEDEAT, whose primary mandate is to create jobs in our province, is R1,146 Billion. The budget for the personnel of the provincial entities is R 1,174 Billion. So staffing of provincial entities is better funded than an entire provincial department. How can this be???

Secondly, the budget for the LRED fund, which is possibly the most effective tool in the department for creating sustainable jobs, gets a budget of R22 million. This is monopoly money. But  – the ten CEO’s of the public entities in our province earn a collective salary in excess of R30 million. Two of these CEO’s earn in excess of R5 million each, R1,4 Million more than our President.

Madam Speaker, I have no problem with linking success to remuneration, but please bear in mind that all of the public entities in this province are subsidised by the department and other funding sources, and are incapable of functioning as stand alones yet. How can they justify such salaries, when the LRED fund cannot even receive credible funding? This is a real indictment on those who have condoned these salaries.

Furthermore, because of administrative processes such as due diligence and HOD approval, it is very difficult for this LRED fund to be spent in a single financial year. These funds must be allowed to roll over from one financial year to the next, for meaningful progress to be made. The LRED fund is, after all, the most appropriate platform for the development of capacitated entrepreneurs, who will ultimately kickstart the black industrialisation that we so desperately want to see in the province.

I wish to commend the ELIDZ at this point, for addressing broad-based black economic empowerment very effectively through locally based contracts and SMME’s, as well as effecting their plan to be self -sustainable within a specific time frame, despite challenges.

Madam Speaker, I will not mention all the entities individually, but look forward to the report on the rationalisation of public entities in the country and the province, as some are bloated, dysfunctional and unnecessary.

The Democratic Alliance looks forward to these entities, and our department, relying less on consultants before making decisions affecting our economic development. They are, after all, in it for the money and will happily tell you what you want to hear.

Finally, Madam Speaker, it is out of respect for the DEDEAT Portfolio Committee, and for the researchers and coordinators, and the officials within this department that all work so tirelessly to try to promote the environmental integrity of the province and improve our economic circumstances that I say the following: when Treasury decides to give economic development a proper budget, instead of Monopoly money, the DA will support the budget. Until then, we cannot. I thank you.

 

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