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SA Home Affairs: Budget Cuts Will Not Results in Office Closures

The South African Department of Home Affairs says that compulsory budget cuts will not mean it has to close any of its offices, but will have a “negative impact on the filling of some posts”.

Minister of Home Affairs, Aaron Motsoaledi, confirmed his department was facing compulsory budget cuts in reply to a Parliamentary question from the DA’s Joseph McGluwa.

“Budget cuts will have a negative impact on the filling of some posts, but we are not envisioning closure of any Home Affairs office,” he said.

Details of the cuts are contained in a document published by National Treasury in June. The paper provides national departments and public entities with guidelines of how to prepare their budget submissions.

It refers to a compulsory budget baseline reduction scenario of:

  • 5 percent in 2020/21;
  • 6 percent in 2021/22; and
  • 7 percent in 2022/23.

Departments must show how they can make cuts with the least impact for service delivery, and must suggest “non-priority programs and projects to be scaled down or closed.

 

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Sources: [1], [2]. Image sources: [1], [2].

South African President’s 5-Point Plan to Tackle Gender-Based Violence

South African President Cyril Ramaphosa on Wednesday announced a five-point emergency plan to put a halt to gender-based violence during an extraordinary joint sitting of Parliament.

The five points are prevention, strengthening the criminal justice system, enhancing the legal and policy framework, ensuring adequate care, support and healing for victims of violence and strengthening the economic power of women.

The plan will be implemented over the next six months.

1. Prevention

“In implementing our prevention measures, we must recognise that violence against women is not a problem of women. It is a problem of men,” Ramaphosa said.

This part of the plan entails the following measures:

  • A mass media campaign that will target communities, public spaces, workplaces, campuses, schools and recreational spaces like taverns. The focus will be on men’s groups and formations, youth at risk and offenders inside prisons.
  • Women’s rights and gender power relations will be part of Life Orientation in the school curriculum.
  • Gender-sensitivity training for law enforcement officials, prosecutors, magistrates and policymakers. Those who are found in breach of their responsibilities in this regard will be held to account.
  • Train and deploy prevention activists to all of 278 municipalities. They will engage in household visits and community interventions focused on changing harmful social norms.

2. Strengthen the criminal justice system

“This is to ensure that justice is served, perpetrators are held to account, survivors do not suffer secondary victimisation, and the law acts as a deterrent,” Ramaphosa said.

It includes the following measures:

  • Directing resources to improve the functioning of sexual offences courts, Thuthuzela care centres, and the Family Violence, Child Protection and Sexual Investigation Units of the SAPS;
  • Funding has already been approved for the establishment of an additional eleven sexual offences courts over the next financial year; and
  • The Department of Justice and Constitutional Development will clear the backlog of criminal cases for rape and other forms of gender-based violence through the establishment of special courts, hiring additional court staff and clearing the backlog at forensic labs.

3. Enhance the legal and policy framework

“Since the advent of democracy, we have enacted several laws and undertaken a number of programmes to tackle gender inequality in our society, to promote human rights and to enable effective action against gender-based violence,” Ramaphosa said.

“In many respects, however, these measures have fallen short of what is needed to confront the severity of the challenges we face.”

The measures to improve the legal and policy framework are:

  • Proposing a range of legal and regulatory reforms to Parliament to strengthen the response of the State to gender-based violence and to ensure that all crimes against women and children attract harsher minimum sentences.
  • Engaging with the judiciary on the role that it can play in supporting the national effort to end gender-based violence to ensure abusers, rapists and murderers know that they will be caught and punished. The State should oppose bail for suspects charged with the rape and murder of women and children and those who are found guilty of such crimes should not be eligible for parole.
  • Strengthen programmes to rehabilitate offenders and youth at risk. Finalise legislation like the Victim Support Services Bill, which will strengthen support for GBV programmes and services.
  • Ramaphosa called on all parliamentary committees to prioritise these areas of legislative reform and ensure that we have effective legislation in place without delay.

4. Ensure adequate care, support and healing for victims of violence

Measures in this part of the plan are:

  • Standardising the framework for funding civil society organisations working with survivors of gender-based violence;
  • Providing post-rape training for healthcare providers and lay counsellors who provide care and support to victims and survivors;
  • Working with the private sector, concerned individuals and other institutions to substantially increase the number of Thuthuzela care centres across the country from the current 54 to over 100 by 2025;
  • Meet with representatives of the private sector to discuss the establishment of a Gender-based Violence and Femicide Fund to increase support to survivors, including persons with disability and the LGBTQI+ community;
  • As drug and alcohol abuse fuel gender-based violence, the Department of Social Development has been tasked with increasing the visibility of substance abuse awareness and education and prioritising funding for more treatment facilities; and
  • Resource the gender-based violence framework in universities and colleges, which will include the establishment of gender equity offices in these institutions. Ramaphosa will meet the universities’ vice-chancellors to come up with initiatives that are focused on what should be done at institutions of higher learning.

Improve the economic power of women

“Women are often hostages in abusive relationships because of poverty and unemployment. Young women, in particular, are vulnerable to exploitation from older men with financial resources. By tackling unequal economic power dynamics we can reduce the vulnerability of women to abuse,” Ramaphosa said.

5. This will include the following measures:

  • Prioritise women when it comes to access to employment, training opportunities and procurement of services, and call upon the private sector to do the same;
  • Reach the target to set aside 30% of the value of its procurement for women-owned businesses, and to progressively increase that to 40%;
  • Prioritise support and training for women engaging in small business and informal sector activity, and call on established business to be part of this effort;
  • All government departments will be expected to adhere to gender-responsive planning, budgeting, monitoring and evaluation; and
  • Improve collection and analysis of data to monitor our GBV programmes.

Comments from other political parties

The EFF‘s Veronica Mente noted that there was no quick fix to the problem. “Our only help is successful policing, prosecuting, tough sentencing and working prisons. We will stay with this problem forever, as long as we do not fix these systems,” she said.

IFP MP Liezl van der Merwe commended Ramaphosa’s initiative and pledged her support. But she noted that following previous high-profile murders of women such as Anene Booysen, Karabo Mokoena and toddler Courtney Pieters, the government had pledged action – but to no avail.

Van der Merwe said that in announcing the interventions outlined in his address, Ramaphosa had shown that he had the courage to act. However, what remained to be seen was whether the government had the courage to govern, the courage to do what was right and the courage to save the nation from becoming a failed state.

“To date, the disjunction between what our women endure and what our government does in response has been alarmingly inadequate,” she added.

ACDP leader Kenneth Meshoe

called for harsher punishments for rape, saying that to help send a clear message that the justice system is serious about fighting gender-based violence, rapists should be denied bail and parole.

UDM leader Bantu Holomisa complimented Ramaphosa’s announcement, saying that the president spoke like a commander-in-chief.

DA leader Mmusi Maimane has called on political party leaders to cast aside their differences and recognise the severity of the gender-based violence crisis consuming South Africa.

“Let us make the dignity, respect and safety of women and girls in our society our number one priority,” he said. He said it was tragic was that few perpetrators were ever arrested and prosecuted, resulting in a conviction rate for rape of just 5%.

Maimane called on parents to set a better example to their sons. “We must raise them to respect girls and women as their equal. We must show our boys, through all our actions, what is right and what is wrong,” he said.

Children should be taught about consent at school, he said, adding that Kenya had achieved dramatic results with a “No Means No” programme in their schools. “We need to introduce similar consent classes in our own life orientation curriculum,” said Maimane, adding that culture, tradition or religion should not be allowed to offer a hiding place for those who commit such acts.

Maimane said the existing legislation was not up to the task as the act dealing with domestic abuse was 20 years old and out of touch. The DA leader proposed that parliament establishes an ad hoc committee to investigate the systemic causes of gender-based violence and to map out long-term solutions.

To watch the National Assembly session, click here.

 

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Sources: [1], [2], [3], [4]. Image sources: shi zhao [1], [2].

Land Expropriation in South Africa: Updates After Parliamentary Ad Hoc Committee Meeting

The parliamentary ad hoc committee on changing section 25 of the Constitution to simplify expropriation without compensation met recently and mapped out the legislative road ahead for the controversial and important constitutional amendment.

It was the first time the committee met since being reconstituted after the election, a delay the new chairman, Dr Mathole Motshekga of the ANC, took responsibility for.

Although each new parliament is not bound by the decisions of its predecessors, the newly constituted committee will build on the work of its equivalent in the previous parliament. This includes the mandate of the committee, the public hearings which were held in 45 towns and cities across the country, the report of the high level panel chaired by former president Kgalema Motlanthe and the presidential advisory panel on agriculture.

Land issue in South Africa relates directly to the Constitution

Motshekga warned MPs to be circumspect because the land issue relates directly to the Constitution and the current parliamentary process is sure to be weighed by the courts, who will override any improper process. The chairman then proceeded to map the way forward.

Firstly, the committee will hold a workshop of experts to advise it, and Motshekga wants to invite what he calls the best brains in the country to participate. These would include, but not be limited to, Prof. Ruth Hall (UWC), Prof. Ben Cousins (UWC), Prof. Quinton Johnson (NMMU), former judges Albie Sachs, Dikgang Moseneke, Sandile Ngcobo and Johan van der Westhuizen, Adv. Tembeko Ngcukaitobi, the lawyers’ organisations Nadel and the BLA, AgriSA, Khoisan leaders and church groupings.

After the workshop, Parlaiment’s legal services will brief the committee, after which draft legislation will be produced. Although the deadline for the committee finishing its work is 31 March, Motshekga said is should not allow deadlines to paint it into a corner, and that the end of June next year is probably a better target date to finish the process.

Draft legislation to be completed by June 2020

DA MP Dr Annelie Lotriet expressed surprise at the way Motshekga simply followed his own preferences without consultation, and said the DA would, for a start, definitely add more names to the workshop input to strengthen it and make it more representative.

Her fellow DA MP Adv. Glynnis Breytenbach immediately added the names of former President Kgalema Motlanthe and Adv. Wim Trengove, adding that there were more to come.

The Freedom Front Plus’ Dr Corne Mulder said he disagreed with Motshekga’s summation of the current situation, but agreed that a slower and more thoughtful, thorough approach was preferable. In this he was supported by IFP MP Inkosi Elphas Buthelezi.

EFF Chief Whip Floyd Shivambu, however, did not agree with this approach at all. He said too much time was being wasted intellectualising on issues and holding workshops when all that had to be done was decide on the exact wording of the constitutional amendment which the ad hoc committee was bound to implement.

On behalf of the ANC, its MP Mandla Mandela agreed with the slower approach, saying that it was key to the essence of South African democracy that all voices be heard and that the process followed be above reproach.

The committee then adjourned and will now propose names for those experts to be invited to brief it in the workshop planned for the near future.

 

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Sources: [1], [2]. Image sources: [1], [2].

South African Solar Energy Tax Incentives You May Not Be Aware Of

A little-known amendment to the Income Tax Act allows for depreciation in the year of commissioning of the full cost of a grid-tied solar PV system of less than 1 MW used for electricity generation by a business in the course of its operations.

South Africa’s government, energy regulator and Eskom have often been criticised for obstructing the introduction of distributed, small-scale embedded generation (SSEG) which would help businesses to cut costs and ensure the stability of their power supply during load shedding.

But in fact, there are significant and far-sighted tax breaks which have been put in place by National Treasury to encourage and incentivise business owners to install their own generation in the form of grid-tied, rooftop or ground-mounted solar PV systems on buildings, parking lots, warehouses, factories and farms.

Accelerated depreciation allowances

From 1 January 2016, a little-known amendment to Section 12B of the Income Tax Act (Act 58 of 1996) allows for depreciation in the year of commissioning of the full (100%) cost of a grid-tied solar PV system of less than 1 MW used for electricity generation by a business in the course of its operations.

The capital depreciation allowances for solar PV systems greater than 1 MW remained unchanged in the January 2016 amendment to the legislation, which continues to allow full depreciation over three years. This permits depreciation of 50% of the capital cost in the year of commissioning, 30% in the subsequent year, and 20% in the third year.

The accelerated depreciation allowance for solar PV systems applies whether they are installed for the business by contractors or developers, or paid for by the business in a credit sale agreement (as defined in Section 1 of the Value-Added Tax Act) — either upfront in a single payment or in multiple payments over an extended period.

The cost of the solar PV system allowed for accelerated depreciation includes its full direct capital cost, including design and engineering, project planning, delivery, foundations and supporting structures, solar PV panels, AC inverters, DC combiner boxes, racking, cables and wiring, and installation. Finance costs are excluded.

This allowance was confirmed in a binding private ruling by SARS dated 11 October 2018 (BPR 311) in respect of an application by a private company in South Africa to clarify the deductibility of the capital expenditure incurred to install solar PV systems at a number of sites owned and leased by the applicant. The systems were being installed to reduce the company’s electricity costs.

The improved business case

Whether paid for upfront after commissioning, or in multiple payments over an extended period, the benefits of this tax incentive to business owners, particularly for solar PV systems of less than 1 MW, are significant.

Where the company tax rate is 28% and payment is upfront, a 100% tax-deductible depreciation allowance in the year of installation and commissioning will result in a 28% nett discount on the purchase price of the system at the end of the tax year.

This significantly affects and reduces the payback period of a solar PV project of less than 1 MW.

Better still, when paying for the same solar PV system on a credit sale agreement through multiple payments over an extended period, the transaction can be cash-flow positive for the business over the lifetime of the solar PV plant in all but the first months to the end of the tax year during which commissioning takes place.

With these significant tax incentives and the rapidly rising price of grid electricity, the business case for installation of grid-tied, rooftop and ground-mounted solar PV is fast becoming a no-brainer.

Awareness of the incentives

What is most surprising, however, is how few business-owners and companies are aware of these tax breaks, which can make such a positive impact on their cash flow and bottom line.

This lack of awareness is perhaps a result of the difficulties faced in accessing relevant information on the subject from SARS itself.

For example, efforts to simply download or view the up-to-date amended Section 12B of the Income Tax Act from the SARS website and the public internet proved fruitless. Similarly, no response or even acknowledgement of receipt was received to a query sent to the SARS media desk at sarsmedia@sars.gov.za.

Only after a time-consuming search and a paid subscription to a private tax information service provider was this possible.

In an article in Engineering News on 14 August 2019, entitled “Time to end silence on renewables misinformation — SAPVIA chair”, the new chairman of the South African Solar Photo-Voltaic Industry Association (SAPVIA), Wido Schnabel, said:

“The organisation will become more assertive in outlining the benefits of solar for South Africa and in correcting some of the prevailing misperceptions about the role of variable renewable energy in the country’s future electricity system.”

The tax incentives available to businesses for the installation of solar PV systems is certainly something that SAPVIA and other related industry associations should be “shouting from the rooftops” in the interests of their members, as well as those of developers, installers and suppliers of solar PV systems, components and services.

The challenge

Businesses which have installed solar PV in the 2018/19 tax year, or are about to do so, stand to benefit substantially. The Council for Scientific and Industrial Research (CSIR) estimates that there was close to 400 MW of installed solar PV in the country at the end of 2017 and that up to 200 MW was installed the following year. With a wider understanding of the business case, this could be much higher in future.

Most of these installations are less than 1 MW — which is all that most private businesses require across a wide range of sectors of the economy, including manufacturing and retail.

If only the various arms of government, business, labour and communities were on the same page and working with a common purpose to bring the benefits of SSEG to the productive economy and the environment, to address the current electricity and water supply constraints, and to facilitate economic growth and the creation of quality jobs.

This article was written by Chris Yelland (investigative editor at EE Publishers) and Mariam Isa (a freelance journalist).

 

For information as to how Relocation Africa can help you with your Mobility, Immigration, Research, Remuneration, and Expat Tax needs, email marketing@relocationafrica.com, or call us on +27 21 763 4240.

Sources: [1], [2]. Image sources: Mariana Proença [1], [2].

South Africa Sets Up National Committee for New African Trade Agreement Action Plans

South African Minister for Trade and Industry, Ebrahim Patel set up a National Committee, comprising business, labor and government, to develop action plans around the new African Continental Free Trade Agreement (AfCFTA).

This was done at a strategic session held between the Ministry and social partners at NEDLAC (the National Economic, Development and Labour Council, South Africa’s statutory social dialogue forum).

The engagement was chaired by Minister Patel, and was the first session held with the new Ministry at NEDLAC following the start of the Sixth Administration, and the combination of the dti and Economic Development Department into the new Department of Trade, Industry and Competition.

The day-long session gave rise to a number of tripartite working groups to speed-up actions to grow the number of jobs in the South African economy.

Both Business and Labour sent high level delegations to the engagement, including leaders from BUSA, CEOs of large companies and sector business organisations; as well as trade union leaders from COSATU, FEDUSA and NACTU.

Representatives of the Public Private Growth Initiative were also present in the meeting. The state was represented by Deputy Ministers of Trade and Industry, Fikile Majola and Nomalungelo Gina, senior officials from the new Department and a number of regulators, including SARS and ITAC. Minister Patel opened the all-day engagement by reflecting on the state of the economy.

“The South African economy produced R5 trillion worth of goods and services in the last year. We need to boost the size of that output and bring more people into the economy. There are currently 16,3 million people in employment in South Africa. We need to create more jobs, and better jobs for the 10 million South Africans who are willing and able to work but are unable to find employment. Neither despair nor blame constitute effective solutions. We have an opportunity to build on our real strengths as a nation, to turn the relatively modest job creation into a significantly larger effort, with workable and actionable solutions to unblock growth, investment and job creation in the economy,” he said.

The engagement focused on a number of key developments in the local and global economy, including the new Industrial Strategy outlined by President Cyril Ramaphosa during the State of the Nation Address in June, and the African Continental Free Trade Area (AfCFTA), which has been ratified now by 27 African countries, including South Africa.

The AfCFTA is intended to be implemented from July 2020, and has been recognize by all constituents as a game-changer for African economies, with the opportunity for new markets for South African goods, balanced by the risk that certain industries may come under threat from imports from across the continent.

The NEDALC parties agreed that a National Committee with sector-level task teams should identify which products South Africa could export to other African countries and what steps needed to be taken to realise such exports. The teams should also point to products that are vulnerable and develop measures to strengthen such sectors.

Government officials also provided updated presentations on South Africa’s export and investment promotion services, plans to improve the ease of doing business, development of special economic zones, changes to the Competition Act, empowerment and black industrialists programs, and the trade dimensions of the digital economy.

The engagement has now resulted in a number of working groups and committees, with constituents drawn from government, business and labor. These include a Ministerial Export Promotion Panel that will be constituted shortly, a Special Economic Zone reference team and a Working Committee on trade policy and the digital economy. Working groups are expected to meet during August and September.

Minister Patel commended social partners on their approach to the engagement, which he noted as solutions-driven.

“Partnership requires that every constituency brings concrete commitments by members to the table and also identifies what it seeks to achieve for its members. We need bold commitments from business and labor. Government will need to be more effective in creating the foundations for growth, transformation and development. This is an opportunity to do things differently. What we have seen in this dialogue begins to reset the tone for a collaborative approach to unlock inclusive growth and job creation in our country,” said Patel.

For more information about AfCFTA, visit the African Union’s website by clicking here.

 

For information as to how Relocation Africa can help you with your Mobility, Immigration, Research, Remuneration, and Expat Tax needs, email marketing@relocationafrica.com, or call us on +27 21 763 4240.

Sources: [1], [2]. Image sources: [1], [2].