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Zuma signals radical changes

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Independent Newspapers

President Jacob Zuma. Photo: Leon Nicholas.

Cape Town - Radical legislative changes are on the cards and the ANC has given notice that it plans a drastic push on emotive and controversial policies such as land, mining and health.

Just 18 months before the elections and a few weeks after the ANC’s policy conference, President Jacob Zuma used the party’s 101st anniversary celebrations yesterday to reveal a raft of targets for action – some as early as this year.

Addressing a capacity crowd at the Kings Park stadium in Durban and flanked by his party deputy Cyril Ramaphosa and deputy in government Kgalema Motlanthe, Zuma outlined potential changes to the tax and licensing regimes that govern mining in South Africa.

“We have … resolved that the state must capture an equitable share of mineral resource rents through the tax system and deploy them in the interests of long-term economic growth, development and transformation. Government must implement this resolution,” he said.

Taxation on super profits is in the offing along the lines of recommendations in the ANC’s research report, State Intervention in Minerals Sector.

The report proposes state control through the introduction of a 50 percent resource rent tax, or a super tax, which kicks in only when an investor has made a reasonable return, so as not to deter investors.

ANC insiders say this could replace the existing royalty regime.

Mining companies should also expect tough penalties for not complying with new rules governing beneficiation, particularly in sectors like platinum, steel and coal.

In December ANC officials stressed all interventions in the mineral sector will be “evidence-based” on a case-by-case basis. The investment community has lamented policy uncertainty, citing it as a risk factor deterring investment.

At a gala dinner on Friday attended by business sectors, Zuma urged business to come to the party and engage the ANC.

He slammed what he called the “the monopoly domination of the economy” and said it impeded the goals of economic transformation, growth and development.

While the ANC has opted for a mixed economy, Zuma was firm on an expanded role for the state.

“Within this mixed economy, we re-affirm the active and interventionist role of the state in ensuring economic development.”

On the land question, the ANC wants to re-open the lodgement date for claims and provide for the exception to the 1913 cut-off date to accommodate historical landmarks, heritage sites and descendants of the Khoi and San who lost their land long before 1913.

“These amendments to our laws will take effect this year,” Zuma said. The infamous 1913 Land Act was introduced a century ago, which marked the dispossession of land from the black majority.

He announced there would be special programmes this year to remember the injustices perpetrated under the 1913 Land Act.

Zuma admitted that the government was unlikely to meet its target of transferring 30 percent of the 82 million hectares of agricultural land, which was white-owned in 1994, to black people by 2014.

He said the government would replace the “willing buyer; willing seller” principle with a “just and equitable” principle of land expropriation.

Zuma also used the opportunity to reveal that plans were in place to introduce the National Health Insurance Fund by next year. While details on how it will work remain sketchy, it is understood that it will operate as an independent agency reporting directly to Health Minister Aaron Motsoaledi.

The government’s much vaunted one trillion rand infrastructure roll-out plan, the bedrock of its stimulus package to ramp up economic growth, also came under the spotlight. “We call on government to hasten the implementation of all 18 strategic infrastructure projects, especially those directed at the 23 poorest districts in the country,” he said. - Weekend Argus


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