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Key Points From the 2020 South African State of the Nation Address

President Cyril Ramaphosa has admitted that the country is facing serious challenges but said action was being taken to address them. The President delivered South Africa’s 2020 State of the Nation Address in Parliament, in Cape Town, last night.

Load shedding and Eskom

“The load shedding over the last few months has had a debilitating effect on our economy and our people. At its core, load shedding is the inevitable consequence of Eskom’s inability over many years – due to debt, lack of capacity and state capture – to service its power plants.”

Ramaphosa said that in order for Eskom to undertake the fundamental maintenance necessary to improve the reliability of supply, load shedding will remain a possibility for the immediate future. He said as Eskom works to restore its operational capabilities, government will be implementing measures that will fundamentally change the trajectory of energy generation in our country. These measures include to rapidly and significantly increase generation capacity outside of Eskom.

“We will put in place measures to enable municipalities in good financial standing to procure their own power from independent power producers,” Ramaphosa said. Municipalities such as the City of Cape Town, business leaders and, lately, the ANC, have backed a plan to allow municipalities to be less reliant on Eskom.

“Over the next few months, as Eskom works to restore its operational capabilities, we will be implementing measures that will fundamentally change the trajectory of energy generation in our country,” Ramaphosa said.

As part of Ramaphosa’s planned steps for the state to become less reliant on the troubled power utility, the president said that the Integrated Resource Plan of 2019 with be given effect to allow for the development of additional grid capacity from renewable energy, natural gas, hydro power, battery storage and coal.

“We will initiate the procurement of emergency power from projects that can deliver electricity into the grid within three to 12 months of approval,” Ramaphosa said. He said they will allow more independent power producers to supply energy to the grid.

Land Reform

The expropriation of land without compensation also remained key, said Ramaphosa, adding measures would be taken to implement the decision after Parliament has concluded all the issues. Ramaphosa emphasized that land expropriation would be done with caution as agriculture is one of the industries with the greatest potential for growth.

“Government stands ready – following the completion of the parliamentary process to amend section 25 of the constitution – to table an expropriation bill that outlines the circumstances under which expropriation of land without compensation would be possible. To date, we have released 44 000 hectares of state land for the settlement of land restitution claims, and will this year release around 700 000 hectares of state land for agricultural production,” Ramaphosa said.

The president also announced that this year his government would implement key recommendations of the presidential advisory panel on land reform and agriculture to accelerate land redistribution, expand agricultural production and transform the industry.

“We are prioritizing youth, women, people with disabilities and those who have been farming on communal land and are ready to expand their operations for training and allocation of land. A new beneficiary selection policy includes compulsory training for potential beneficiaries before land can be allocated to them,” he said.

State-owned Enterprises

Ramaphosa said serious action will have to be taken to deal with SOEs who are drowning in debt with the National Treasury providing guarantees of more than R570 billion.
“This year, we are moving from the stabilization of state-owned enterprises to re-purposing these strategic companies to support growth and development.

“After years of state capture, corruption and mismanagement, we are working to ensure that all SOEs are able to fulfill their developmental mandate and be financially sustainable,” the president said. “In consultation with the Presidential SOE Council, we will undertake a process of rationalization of our state-owned enterprises and ensure that they serve strategic economic or developmental purposes.

The extent of capture, corruption and mismanagement in SOEs is best demonstrated at South Africans Airways, which was placed in business rescue late last year. The business rescue practitioners are expected to unveil their plans for restructuring the airline in the next few weeks.”

The train system

Ramaphosa also committed to turning around the Passenger Rail Agency of South Africa to fix the commuter rail network and said a plan for restructuring South African Airways would be unveiled in the next few weeks, and said government’s successes included pushing back against corruption.

Gender-Based Violence

Ramaphosa said they will increase their fight against gender-based violence. “We will amend the Domestic Violence Act to better protect victims in violent domestic relationships and the Sexual Offences Act to broaden the categories of sex offenders whose names must be included in the National Register for Sex Offenders and we will pass a law to tighten bail and sentencing conditioning cases that involve gender-based violence,” said Ramaphosa.

The youth

One per cent of South Africa’s budget would be set aside to assist with youth employment, Ramaphosa said during his State of the Nation Address .
“This will be through top slicing from the budget, which will require that we all tighten our belts and redirect resources to address the national crisis of youth unemployment,” he said. The initiative would be prioritized when Finance Minister Tito Mboweni delivered his medium-term budget policy statement later in the year.

Ramaphosa said the initiative was one of six “priority actions” spanning five years to reduce youth unemployment. The initiative would start immediately he said, under the banner of the Presidential Youth Employment Intervention. Ramaphosa said the six actions would ensure that the capabilities of every young South African was “harnessed”, enabling them to contribute to the growth of the country.

“We are building cutting-edge solutions to reach young people where they are – online, on the phone and in person. This will allow them to receive active support, information and work readiness training to increase their employability and match themselves to opportunities.”

He said that starting this month, government was launching five prototype sites in five province “that will grow to a national network reaching three million young people through multiple channels”. The network would allow young people to receive active support, information and work readiness training to increase their employability and match themselves to opportunities.

“We are fundamentally changing how we prepare young people for the future of work, providing shorter, more flexible courses in specific skills that employers in fast-growing sectors need. We are developing new and innovative ways to support youth entrepreneurship and self-employment,” Ramaphosa said.

“We are scaling up the youth employment service and working with TVET colleges and the private sector to ensure that more learners receive practical experience in the workplace to complete their training. We are establishing the first cohort of a presidential youth service program that will unlock the agency of young people and provide opportunities for them to earn an income while contributing to nation building.”

As part of the intervention, he said, the National Youth Development Agency and the department of small business development would provide grant funding and business support to 1 000 young entrepreneurs in the next 100 days, “starting today”.

Crime

He said that while police statistics showed that violent crime, rapes and murders have not gone down, improved detective methods would be effected through the training of officers. Ramaphosa said: ” Anti-Gang Units will be further strengthened, with priority given to the Western Cape, Eastern Cape, Gauteng and Free State.

“Following the graduation of 5 000 police trainees last year, 7 000 new police trainees have been enlisted this year to strengthen local policing. To improve the quality of general and specialized SAPS investigations, we are establishing a Crime Detection University in Hammanskraal,” the president said.

Cannabis

Ramaphosa also told the nation about his plans for hemp and cannabis. “This year we will open up and regulate the commercial use of hemp products, providing opportunities for small-scale farmers; and formulate a policy on the use of cannabis products for medicinal purposes, to build [the] industry in line with global trends”, Ramaphosa said.

 

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

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

Today Marks The 30 Year Anniversary of Nelson Mandela’s Release

February 11 marks the 30th anniversary of the release of former president Nelson Mandela who was jailed for 27 years following his arrest in 1962. South Africa will mark the anniversary with a string of events commemorating the historic moment when Mandela walked out of Victor Verster prison in the Western Cape.

The Nelson Mandela Foundation will host three events in the province that will highlight the “new prisons of Africa”. On its website, the foundation said the “prisons” ranged from physical prisons that were the site of high levels of incarceration and the failures of restorative justice to the effective prisons that defined people’s lives.

From 08:00 to 10:00, the foundation is expected to host a reunion of the original members who were in the reception committee that facilitated Madiba’s homecoming from Victor Verster, now called Drakenstein Correctional Services. President Cyril Ramaphosa is also expected give an address from Cape Town City Hall’s balcony, where Mandela gave his first speech after his release from prison, between 14:30 and 16:30.

In his Monday morning newsletter, Ramaphosa commemorated the release of the former president and ANC leader. He said while the country’s democracy was “well-entrenched” with robust and durable institutions and the lives of people had improved over the past 25 years since the first democratic elections, more needed to be done.

“Yet, there is so much further we need to travel. Inequality, especially as defined by race and gender, remains among the highest in the world. “Unemployment is deepening and poverty is widespread. Violence, including the violence that men perpetrate against women, continues to ravage our communities. In confronting these challenges, it is vital that we remain united,” Ramaphosa said.

Archbishop Emeritus Desmond Tutu and his wife Leah, who will be commemorating the anniversary on Tuesday, also paid tribute to Madiba, saying while circumstances and priorities changed over time, good values were timeless. “Thirty years ago, Nelson Mandela emerged from prison to dazzle South Africa and the world with his warmth and human values… We miss him,” the Tutus said.

Also commemorating the historic release will be the head of the Mvezo Traditional Council and Mandela’s grandson, Nkosi Zwelivelile Mandela, who called on South Africans to remember the leader as well as the vision his grandfather had had for the nation.

“We can make South Africa great again. We can fight the scourge of poverty and corruption. We can overcome all obstacles and achieve the vision of a united, free, non-racial, non-sexist and just South Africa in which all can enjoy prosperity and a better life for all,” he said.

Road Closures

Darling Street and surrounds will have traffic restrictions in place until 10pm on Tuesday, February 11 2020. Darling Street will be closed to traffic between Lower Plein and Buitenkant streets until the conclusion of Tuesday’s events. No parking will be permitted in Corporation and Parade streets. “The city appeals to motorists to seek alternative routes where possible as the restrictions/closures will likely result in some traffic congestion. Staff will be on duty in the area to redirect traffic,” Cape Town traffic service spokesperson Maxine Bezuidenhout said.

 

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

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Cape Town Back-yarders Urged to Register on Housing Database

An increase in urbanization is the leading factor in Cape Town’s housing crisis.

With only one in three registered on the city of Cape Town’s housing database, the city has encouraged more people in this sector to register.

The city said in a statement recently that almost 70% of informal back-yarders in the metro would not be eligible for a housing opportunity because they were not registered for subsidized housing.

The city says increased urbanization across South Africa over the past decade has resulted in a steady growth of backyard dwellings on publicly- and privately-owned land.

“The great need for affordable housing and services in and near urban centers especially means that we must ensure that we work in a planned, systematic and fair manner.

“It is really important for backyard dwellers to apply to register on the housing database. Back-yarders who are not registered on the database cannot be considered for housing opportunities created for them by the city and Western Cape Government. “

The city said that all qualifying beneficiaries and especially backyard dwellers should ensure that they were registered and that their details were correct and up to date.

“We also continue to focus on enhanced service delivery especially to back-yarders residing on council-owned properties. Cape Town was the first city in South Africa to introduce basic services to back-yarders residing on Council-owned properties.

“The back-yarder program started in 2014 and entails the provision of one-to-one water, refuse and electricity services to back-yarders residing on Council-owned property, such as rental units.

“The Municipal Finance Management Act determines that public money may not be used for enhancing private properties. Therefore, much work still needs to be done to see how back-yarder services will be rolled out to those residing on private properties within the framework of the law.

How to register on the housing database

The city said that urbanization was a challenge that all tiers of government, as well as the private sector and civil society organisations should deal with.

We “must work together and ensure that we are ahead of the curve with our plans to address rapid urbanization. We must bring our communities on board with the alternatives on offer”, the city’s member of the mayoral committee for human settlements, councilor Malusi Booi, said.

He also explained that the service was free and that there was no payment for registration.

Applicants can register on the housing database online, at city housing offices, MyEstate mobile offices that comes to various areas and at the Parow or Wale Street walk-in centers.

Applicants need a certified copy of their IDs and their spouses’ IDs, a completed housing assistance form, copies of their children’s birth certificates, marriage or divorce certificates, details of special needs where applicable, as well as supporting documents such as medical records and proof of address (FICA).

 

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

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

Cheque Limits Reduced to R50,000 in South Africa

Following the recently announced rules from the Payments Association of South Africa (PASA) to reduce the maximum value of cheque limits to R50,000, businesses are urged to adopt electronic banking channels.

The updated rules come into effect in May 2020, with an eight-month grace period to be granted for cheques that are yet to be processed by the due date.

Kenneth Matlhole, FNB Business Spokesperson, said several businesses and public institutions that still have cheques built into their operations will be heavily impacted by the decision. This ranges from schools, churches, scrap metal dealers, agriculture, motor industry, fiduciary services and auctioneers, among others.

Matlhole unpacked important factors for businesses to consider as they reduce their reliance on cheques, prior to the implementation of the new rules:

Act now – depending on the nature of the business or institution, moving away from a traditional payments system may result in cash flow disruptions. Business should allocate enough time for migrating to new payments systems. It is also essential to ensure that staff members are trained accordingly.

Business to business transactions – whether the business is receiving or issuing cheques, it is advisable to communicate and inform business associates and suppliers about the new payment systems/ arrangements and reach a mutual understanding.

Businesses can offer discounts or incentives for suppliers or business associates to adopt electronic banking channels, to help speed up the process.

Moreover, when considering the administration process, storage of physical paper, and the cheques clearance waiting period, migrating to electronic payments which are more efficient will no doubt be an incentive to migrate to electronic payments.

The same guiding principles for alternative payment adoption should be applied to inter-company funds transfer where cheques have been used as a mechanism to allow for money flow between linked franchises and business entities.

Adopt electronic banking channels – once a thorough analysis of how the business uses cheques has been conducted, the next step is to identify the most appropriate and efficient electronic banking channel to use. Furthermore, businesses that are still receiving B2B cheque payments should ensure that their systems are updated and ready to accept electronic payments.

“Given the reduction of cheque limits due to several issues including fraud, it may not be viable for businesses to continue using cheques.

“Regardless of the final decision to be taken by businesses, on thing is clear, the imminent reduction of cheque limits to R50,000, leaves businesses and institutions with no choice but to ultimately reduce their reliance on cheque payments,” Matlhole said.

 

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

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

Finance Minister Tito Mboweni Tries to Keep the South African Reserve Bank from Being Nationalized

Finance Minister Tito Mboweni took to Twitter recently to ask what the ANC wanted to achieve by nationalizing the bank.

The African National Congress (ANC) has cautioned Finance Minister Tito Mboweni to be aware of the implications of his comments about the party’s position to nationalize the South African Reserve Bank.

Mboweni, who is also an NEC member, has tweeted that the ANC adopted the wrong resolution during its policy conference in 2017 by wanting the central bank to be nationalized.

The issue of what purpose the reserve bank should and should not serve has once again played out within the ANC.

Mboweni took to Twitter recently to ask what the ANC wanted to achieve by nationalizing the bank.

“As a long standing member of the ANC and its leadership structures, I know and understand our resolutions. I don’t need lectures on that. But on the SARB, I am convinced that we adopted a wrong resolution. What do we want to achieve? Our Strategic focus: Structural Economic Reforms,” Mboweni said recently.

“As of now, 90% of the SARB profits are handed over to the National Revenue Fund. So? What do we want to achieve? Tell the public. Lets debate. Don’t say internal debates, this is a fundamental National debate. Answer the question. What do you want to achieve by nationalizing the SARB. Don’t tell me about internal debates, NEC, etc. what do you want to achieve? Lets answer that fundamental question. Party spokesperson Pule Mabe said that the leadership of the ANC was expected to be consistent, coherent and united on policy positions. The leadership of the ANC is expected to appreciate the need to articulate a consistent, coherent and unified message on policy positions. Unfortunately, public spats initiated without any provocation feeds into the narrative of lack of policy certainty,” he continued.

ANC leaders counter-attacked each other last year about the mandate of the central bank, with some saying the mandate of the institution should be expanded to include job creation.

The party said that only the ANC national conference had the right and power to change any decisions.

 

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

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