DAILY PARLIAMENTARY DEBATES FOR THE FIRST SESSION OF THE TENTH ASSEMBLY

Thursday, 2nd August, 2007

The House met at 1430 hours

[MADAM DEPUTY SPEAKER in the Chair]

NATIONAL ANTHEM

PRAYER

_________

MINISTERIAL STATEMENT

ECONOMIC PARTNERSHIP AGREEMENT (EPA) NEGOTIATIONS

The Minister of Commerce, Trade and Industry (Mr Mutati): Madam Speaker, Zambia is involved in the negotiations of an Economic Partnership Agreement with the European Union (EU) under the Eastern and Southern Africa (ESA) configuration, which includes sixteen countries from the Common Market for Eastern and Southern African (COMESA) regional grouping. In looking at the new trade agreement to be concluded with the EU by the ESA group, the key question is: What will Zambia concretely benefit from this agreement?

Madam Speaker, let me assure hon. Members that this question is at the forefront of the concern of Zambian negotiators at all levels of these negotiations. Rest assured, our partners in Europe know what is in their economic interest. In October last year, they set in their trade strategy paper just how the free trade agreements they are negotiating will promote jobs and growth in Europe.

Madam Speaker, the Economic Partnership Agreement negotiations started in February 2004, and cover six negotiating clusters, namely; market access, development, agriculture, trade in services, fisheries and trade in related issues. The question of importance to this House, of course, is: What is in an EPA for Zambia?

Let me start answering this question by exploring where we would like any trade agreement with the EU to help Zambia get to.

Madam Speaker, we in Zambia know well the dangers of excessive dependence on raw material production, where prices can fluctuate widely, through national development efforts into chaos. A critical objective of Zambia in these trade negotiations is thus to make sure that any trade agreement helps us reduce our dependence on unprocessed exports by increasing the value we add to the products, for national and regional exports. If we add value, in Zambia, to goods produced for national, regional and EU markets, then we are creating jobs and enhancing growth in Zambia.

Madam, our objectives for the EPA trade negotiations are thus not so different from those of the EU. The critical and very difficult question is: How do we structure any trade agreement so that it helps Zambia reach the key objective of adding value and creating jobs and growth? Ensuring trade negotiations benefit Zambia is complicated by the fact that the negotiations are being conducted regionally.

Madam Speaker, for Zambia, this issue is further complicated by the complex regional arrangements for trade negotiations. Some of our neighbours are not part of the ESA negotiating group, but the SADC negotiating group (centred on South Africa) including all those countries through which major transport links with the EU pass. This poses certain problems, which we will have to find solutions to.

Madam Speaker, hon. Members may be aware that the Least Developed Countries (LDCs) have a recognised right under the World Trade Organisation (WTO) rules to non-reciprocal trade preferences. In recognition of this right, since 2001, the EU has set in place the ‘Everything But Arms’ initiative which grants LDC’s on a non-reciprocal basis, duty free quota free market access for all exports except arms and ammunitions and, during a transitional period, bananas, rice and sugar. Under this arrangement by the end of year 2009, even these LDC products will enjoy duty free –quota free access to the EU market.

There are two principle constraints on LDC exports under this arrangement and hon. Members will be aware that Zambia is part of the LDC. Madam Speaker, the two principle constraints are:

(a) supply side constraints on competitive production; and
(b) the rules of origin applied

It has long been recognised that LDCs lack the supply capacities to fully exploit the trade preferences extended to them under preferential arrangements. If LDCs are to effectively exploit available trade preferences, then targeted programmes of assistance to address key supply side constraints on competitiveness will be necessary. Unfortunately, no attempt was made to get to grips with this issue at the time of launching of the EBA initiative. This has largely been left to follow up initiatives at the multilateral level, through the so-called integrated framework.

Madam Speaker, equally, there has been a long standing request from LDCs for a revision of the rules of origin under the EBA to make its rules easier and more permissive of new investments in new LDC exports. The European Commission (EC) made no attempt to improve the rules of origin under the EBA.

Instead, the EC is asserting that the only way for LDCs to secure improvements in the rules of origin is to accede to the Economic Partnership Agreement (EPA). This is despite the fact that in the EPA context, the European Commission has made long term proposals which demonstrably improve the rules of origins applied to the ACP exports, which includes LDCs exports, in which ways will promote greater local value addition to improve inputs for production of goods and services for export to the European Union (EU).

Madam Speaker, this is a crucial issue for to date, investment in LDCs stimulated by EBAs have been concentrated in sectors where exports are 100 per cent locally produced, most notably, sugar, fruit and vegetable sectors from Eastern and Southern Africa (ESA).

Giving uprights, but what is the ‘Win’?

Madam Speaker, the negotiation of the reciprocal preferential economic partnership agreements between the EU and regional groupings which include the LDCs, effectively require the LDCs to give up the right to non-reciprocal trade preferences in their trade relations with the EU. In this context, the question is: What is a win for the LDCs under EPAs? More specifically, the following issues arise:

(i) Will the EPAs bring additional benefits to the LDCs in terms of addressing the supply side constraints?

(ii) Will the EPAs bring anything in terms of delivering aid for trade support to enhance the capacity of LDCs producers to compete with EU suppliers under conditions of free trade?

(iii) Will the EPAs bring benefits to the LDCs in terms of simpler and less restrictive rules of origin?

(iv) Will the EPAs bring immediate benefits in terms of investment flows and increased efficiency via the conclusion of inter-regional agreements in trade related areas?

(v) Will the EPAs bring immediate benefits in terms of increased efficiency of service delivery through the conclusion of inter-trade agreements in trade services?

Madam Speaker, in the absence of clear EU commitments which deliver wins in theses areas, it is questionable whether the EPAs will outweigh the cost for LDCs.

Firstly, we need binding aid for trade commitments to address the supply side constraints on our competitiveness. Secondly, we need binding aid for trade commitments to help us adjust to the changing market conditions in the EU and on the regional market. Thirdly, we need to address the rules of origin so that Zambia is not restricted to exports of entirely Zambian produced products and can more simply import inputs for processing into new products for export to the EU.

Madam, we also need to deal with other rules of origin issues linked to EU exports to the ESA region under the preferential trade arrangements which the EPAs will give rise to. This is a complex issue.

Dealing with Government Revenue Concerns

Madam Speaker, with regard to the cost of EPAs, an area of primary concern to governments, including Zambia, is the impact of the full implementation of the EPA tariff elimination on commitments on the Government revenues. In many ACP countries, including Zambia, import duties charged on goods originating from the EU generate a substantial volume of the Government revenue. Removing import duties on this trade could lead to a large hole in the Government revenues. If an alternative system of non-trade tax base collection is not first put in place, this could declare difficulties for this country.

Madam, in some of the ACP regions, these revenue concerns have a major bearing on the construction of regional tariff elimination offers with governments in the LDCs waiting to exclude a large number of revenues sensitive products from the process of tariff elimination. Unless concerns over the revenue consequences of tariff eliminations can be addressed as part of the EPA process, then the question will remain: What is a win for Zambia for signing the EPA?

Madam Speaker, in conclusion, the pace of the negotiation is increasing with a very busy schedule of meetings ahead of us. The coming months will be very difficult and intense. If 31st December, 2007, deadline remains, very important decisions will have to be taken before hand. Everything But Arms Initiative will ensure that market access to the EU is preserved, but the restrictive rules of origin and the lack of a development component will be two important pitfalls for this agreement. A decision on whether to sign an EPA will be based on an overall assessment of the benefits, depending on developments in all the negotiating clusters and how this will cater for Zambia’s development priorities. I will, of course, keep this House fully informed of the developments over the coming months.

Madam, you will recall that Macbeth said, ‘The big picture, giveth, but the small print taketh away.’

I thank you, Madam.

Hon. Government Members: Hear, hear!

Madam Deputy Speaker: Order! Hon. Members are now free to ask questions on points of clarification on the ministerial statement given by the hon. Minister of Commerce, Trade and Industry.

Mr Matongo (Pemba): Madam Speaker, I would like you (hon. Minister) to clarify one point for me and this is the role of the Doha Development Round which has not been agreed vis a vis supporting the supply constraints, which you have alluded to in the EPA negotiations. How comfortable are you with new issues that have made the Doha difficult to arrive - the Singapore or new generation issues?

Mr Mutati: Madam Speaker, in these negotiations, one of the key elements that the EU is putting upfront is that, they are going to provide additional resources to address the supply side constraints. Now, the definition of additional resources has not been made. It could, indeed, be a reallocation of already committed development assistance to the ACP and LDCs.

Madam, under the Doha rand, most of the developed countries agreed that the volume of their development assistance will rise to point zero per cent of their Gross Domestic Products. As we stand today, very few countries have reached that level. Therefore, they are telling us, (LDCs and ACP countries) that we should eliminate our tariffs on the basis of a promise that they are going to deliver resources to address our supply side constraints.

What we are saying is that unless the elimination of tariffs is as binding as the delivering of development assistance, then we will not lose.

Madam Speaker, I thank you.

Hon. Government Members: Hear, hear!

Ms Imbwae (Lukulu East): Madam Speaker, what arrangements has the ministry made to help Zambia access the Fight Trade Africa Trading Window because the window gives us an opportunity to trade in the baobab pulp, watermelon, and other forest and forestry products?

Mr Mutati: Madam Speaker, I mentioned the first issue in the EPAs negotiations. What has been popularly called, by the civil society, including the one that Hon. Lubinda belongs to, as spaghetti arrangements …

Hon. Member: You belong to that arrangement!

Mr Mutati: … indicate the regional groupings that we currently have in Africa such as, SADC, COMESA, Eastern African Community, Economic Community for West African States (ECOWAS) and so on. They are telling us that for the purpose of negotiating with the EU, those regional groupings will collapse and we shall have new regional groupings. Therefore, as the Eastern and Southern group, we have said, we are not going to be put in a corner where we begin to negotiate on a product by product basis, but negotiate, first of all, on the principles that are fundamental in reaching agreement on EPAs. We are saying that EPAs fundamentally must deliver critically for trade to address the supply side constraint.

I thank you, Madam.{mospagebreak}

Mr Kanyanyamina (Kanchibiya): Madam Speaker, deducing from the hon. Minister’s extract, will the hon. Minister assure the House and the nation what measures the Government has put in place to ensure that Zambia is not used as a dumping ground even though the EU has been commended for projects like the Zambia Education Project (ZEP) in the education sector?

Mr Mutati: Madam Speaker, I just made reference to the fact that one of the expectations of the EU under the EPAs is the elimination of tariffs on imports of goods from the EU. Now, protection against dumping means that we are not going to eliminate the tariffs until Zambia addresses the fundamentals of our industry, development, job and wealth creation. Then, we shall have capacity to deal with the imports from any country. At the moment, we do not have that strength.

I thank you, Madam.

Mr Hamududu (Bweengwa): Madam Speaker, the ACP countries have been divided into regions. What measures will the ministry put in place to mitigate the effects of one region signing to EPAs because we would have signed by default? The goods will still sleep in this country and we will feel the negative effects. What measures are you putting in place to avoid such a scenario?

Mr Mutati: Madam Speaker, perhaps, there are two points. The first point is that within our grouping which is the Eastern and Southern Africa and within this grouping, there are LDCs and non-LDCs. Therefore, the agenda in the negotiations is slightly different.

For example, you have within the grouping a country like Kenya which has trade preferences under the Cotonou Agreement. Kenya is saying, ‘come 1st January, I am exporting 60 per cent of my produce to the EU. If I do not sign on the EPAs, I am going to lose 60 per cent of the revenue as Kenya,’ but they are within the same grouping. As LDCs, they are saying, ‘if we sign on EPAs, come 1st January, how are we going to deal with the in flow of products from the EU when we are least prepared?’ The EU is saying, ‘We are going to give you support,’ but we are saying that the sequencing of development assistance is critical and must precede the elimination of tariffs.

The second point, Madam Speaker, is that you have a region which is predominantly under South Africa which is part of SADC. The danger that is there is that the EU can export to South Africa and a product repackaged in South Africa and re-exported to Zambia under SADC rules.

Mr Hamududu: That is what happens.

Mr Mutati: That is a danger. We have to avoid the danger.

Madam Speaker, recognising the danger of a country within the grouping taking advantage of the Free Trade Area (FTA) by repackaging and re-entering our market through the back door, is the reason we have a clear definition of rules of origin that a certain percentage of that product must originate from South Africa. If it does not meet that rule of origin, then we do not accept the product and where it becomes difficult, we impose what is called a non-tariff barrier. The onus is on them to satisfy us that their barrier addition is in excess of 65 per cent. Only then, can we give it duty free under the Free Trade Area under SADC and COMESA.

I thank you, Madam.

Mr Chimbaka (Bahati): Thank you, Madam Speaker, for catching your eye. Madam Speaker the hon. Minister has articulated issues very well, but the question I want to ask is this, since under SADC arrangements, one country is seen to dominate trade and that Zambia which has launched a Buy-Zambia Campaign seems to be losing out on business in that there is literally little that has been done to penetrate SADC markets, what is his Government doing to arrest the situation where a country can bring into Zambia products from European countries thereby creating employment in Europe and denying Zambians employment?

Madam Deputy Speaker: The hon. Minister may re-emphasise.

Mr Mutati: Madam Speaker, in re-emphasising and also to take advantage of this question, I would like to inform the House that the country within SADC, and SADC in general, is a question of measuring the benefits of Zambia for being part of SADC which is an issue which we are going to address tomorrow. However, in terms of figures, the trade into SADC from Zambia as of 2006 was US$762 million against imports of about US$100 million. The reason imports into Zambia are greater than the exports is that, at the moment, we are undertaking massive investments, particularly, in the mining sector. We have a reverse trade balance which we think going forward is going to be positive rather than deficit.

I thank you, Madam.

Mr Milupi (Luena): Madam Speaker, the hon. Minister is right to emphasise that this country needs to reduce its dependence on raw materials and go for processing. In that regard, can the hon. Minister assure this House that his negotiating team will focus on getting agreements from the EU, first of all, to assist this country in processing some of our raw materials, especially copper? It is believed that processing 25 per cent of our total copper production to semi-finished products like plate, rod wire and rewind wire can generate up to 30,000 new jobs and create wealth for this country. Can the hon. Minister assure this House that in these negotiations, he will prevail upon the EU to stop the huge cartels that exist there from preventing us from manufacturing our raw products such as copper?

Mr Mutati: Madam Speaker, the market space is becoming increasingly difficult,   particularly for the EU. The global market in India, China and so forth, is becoming much more competitive and making it difficult for the EU to access those markets. They are also finding it difficult to penetrate the markets in the North and South American continents. Therefore, what is left is this dear continent called Africa and they are saying, “Africa, here we come”.

Now, we are saying that we are not going to ask the EU for help per se, in other words we are not going to eliminate the tariffs until we agree with the EU that we need a platform where we can compete on a fair basis.

I thank you, Madam.

Mr Lubinda (Kabwata): Madam Speaker, the debate around the EPAs in ACP countries has engaged a lot of citizens, and particularly Parliaments, of various countries. In May-June this year, the hon. Minister attended an Eastern and Southern Africa (ESA) meeting in Nairobi. Along that meeting, was a parallel meeting of ESA Parliaments and not a single Parliamentarian from Zambia attended that meeting. I would like to find out from the hon. Minister when he hopes to engage the Zambian public, and particularly this Parliament, in the EPA’s debate and whether he shall bring to this House the agreement for ratification, like all other ACP countries are bound to do, before the Government commits this country to those EPAs. 
Mr Mutati: Madam Speaker, the EPA negotiations, like I said, are complex and intense and they need national ownership. For this reason, I would like, from the outset, to register my appreciation of the efforts Hon. Lubinda is making by calling for a Parliamentary meeting for COMESA countries to try and understand the EPAs better. He is making the right efforts and, as a Government, we will intensively engage the Members of Parliament in Zambia so that, at the end of the day, whether we conclude or not, they are part of this. We are going to come up with a time table of engagement. First, we will give you the material so that you study and understand it, then we can engage each other. Unless you give us the benefit of your counsel and wisdom, it may be difficult to take this process meaningfully forward. So, we shall depend on you.

I thank you, Madam.

QUESTIONS

NEGOTIATIONS FOR FAIRER TRADE TERMS BETWEEN EU AND ACP COUNTRIES

709. Mr Matongo (Pemba) asked the Minister of Commerce, Trade and Industry how far Zambia has gone in negotiating for fairer trade terms with the EU and the ACP trading partners.

The Deputy Minister of Commerce, Trade and Industry (Ms Siliya): Madam Speaker, my prepared statement in answering the question asked by the hon. Member of Parliament for Pemba is the same as that articulated by my hon. Minister in the ministerial statement. However, I just wish to add that Zambia is actually not negotiating with the ACP countries, but only with the EU countries as eloquently articulated by the hon. Minister.

I thank you, Madam.

Mr Matongo: Madam Speaker, it is not my intention to prolong the debate, however, the hon. Minister referred to spaghetti and I would like to say that it is from spaghetti to a macaroni arrangement. What is his vision, in that concept, in the event that the European Development Fund (EDF) is affected by EPAs not being signed by the end of this year? Secondly, I would like him to shade some light on the SADC negotiating team which is now headed by South Africa under that Economic Development Community for Africa (EDCA).

The Minister of Commerce, Trade and Industry (Mr Mutati): Madam Speaker, the hon. Member spent a long time at the ACP so he understands a number of these issues properly. Our perspective is very clear that the pressure to sign is on them rather than on us. We shall wait for them to do the dancing and we think they are going to come by, spaghetti or no spaghetti. At the end of the day, we will have a fall-back position on everything, but arms.

I thank you, Madam.

Mr L. J. Mulenga (Kwacha): Madam Speaker, the time for concluding negotiations is 31st December, 2007 and the supply side, from the hon. Minister’s answer, needs to be addressed by the EU in terms of developmental focus on the Least Developed Countries (LDCs). What time table do we have, as a nation, from now to December, for engaging in these negotiations?

Mr Mutati: Madam Speaker, as we stand today, we have had some experience under commitments by the EU into SADC and in particular, into Swaziland. Swaziland was tasked to remove and reduce air tariffs and that in turn, the EU was going to address the supply side constraints. Two years down the road, nothing has happened. So, that is the experience we have had. In our case, we shall follow our time table and not be tempted by promises that are not binding and that will be given to us by the EU. So, it is time to create a time table and we are in a cool position.

I thank you, Madam.

MEASURES TO REDUCE HOMOSEXUALITY AND PREGNANCIES IN PRISONS

710. Mr Nyirenda (Kamfinsa) asked the Minister of Home Affairs what measures the Ministry had taken to reduce the following in prison:

(i) homosexuality;
(ii) pregnancies; and
(iii) other vices.

The Minister of Finance and National Planning (Mr Magande): Madam Speaker, in answering the question raised by the hon. Member for Kamfinsa, our answer is as follows:

Clearly, this indicates the concern of the hon. Member because Kamfinsa is one of our largest prisons. The issues that he has raised are extremely important.

(i) Homosexuality

This is an illegal and punishable offence under the Prisons Act, Chapter 90 and 97 of the Laws of Zambia.

Madam Speaker, although it looks like no prisoner involves himself in such indecent activity, the Prison Service cannot, however, rule out the possibility of two or so prisoners engaging in homosexual activities. Obviously, if there are caught, then the law takes its course.

In order to contain the issue in the advent of the HIV/AIDS pandemic, the Prisons Service has stepped up educational campaigns in trying to stop homosexuality.

(ii) Pregnancies

Madam Speaker, the Zambia Prisons Service has never had a case of a prisoner getting pregnant while serving a term in prison. However, the Service has been receiving female convicts coming into prison already pregnant and perhaps from the time when they were detained before being sentenced. Such prisoners are looked after accordingly.

(iii) Other Vices

Madam Speaker, the Zambia Prisons Service has made remarkable progress to put an end to anti-social behaviour such as tattooing, communal use of razor blades, sharing of pieced instruments and others. The Service is conducting educational programmes and providing, for example, shaving facilities such as shaving machines. This is done with the assistance of many of our churches, and other cooperating partners that are doing a very good job.

I thank you, Madam

Mr Nyirenda: Madam Speaker, is the hon. Minister aware that there are more than seven children who were born in prisons in the last six months and that they are not taken care of? What is the hon. Minister going to do with these children born in prisons?

Mr Magande: Madam Speaker, as I indicated, if a convict comes to prison and is sentenced while pregnant, they are looked after just like other convicts who need some facilities. In other words, they will be taken for antenatal clinics to make sure that their pregnancies are not terminated prematurely. When the children are born, the first course of action is to ask if there are any relatives who might want to take these children away from the prisons. If there are none, then they will stay with their mothers and be looked after, not as prisoners, but as dependants of the prisoners.

I thank you, Madam.

Laughter.

Mr Mwiimbu (Monze): Madam Speaker, recently, the President of the Republic of Zambia Levy Patrick Mwanawasa, SC, when touring a prison in Mumbwa District lamented at the high rate of sodomy that was obtaining in prisons. Taking into account that the President is aware of this malady that is happening in prisons. Is the Government considering providing condoms to prisoners, as this is one source of HIV/AIDS transmission to those innocent women who are outside the prisons?

Mr Magande: Madam Speaker, the hon. Member for Monze, who is supposed to be a reputed lawyer should know that sodomy is an offence. The fact that it happens does not seem to be a cause to regularise it by issuing condoms to those who want to commit the offence. Therefore, we are not issuing condoms to prisoners who want to commit an offence of sodomy.

I thank you, Madam.

Laughter.{mospagebreak}

 

RELOCATING OF BUTONDO HIGH SCHOOL

711. Mr Chanda (Kankoyo) asked the Minister of Education:

(a) whether the ministry had any plans to relocate Butondo High School due to the mining activities in the area; and

(b) what measures the ministry had taken to prevent pupils at the school from contracting pneumoconiosis.

The Deputy Minister of Education (Ms Changwe): Madam Speaker, there are no plans to relocate Butondo High School from the present location. The mining activities by Mopani PLC will not affect the area at which the High School is situated.

The ministry has written to Luanshya Municipal Council and the Environmental Council of Zambia to prevail on Mopani PLC to install better technology and equipment to reduce on the emissions of sulphur dioxide, which can be a health hazard in the area.

I thank you, Madam.

Mr Chanda: Madam Speaker, first of all, let me seek clarification. Did she mean Mufulira or Luanshya Municipal Council? If it is Luanshya, then we are playing a wrong game. In any case, is the hon. Minister aware that because of the change in the mining methods, there is a lot of dust coming from the mining sites going to the school, which will enhance the chances of pupils contracting pneumoconiosis?

The Minister of Education (Professor Lungwangwa): Madam Speaker, all health related matters affecting our pupils and teachers in schools would be attended to by our health experts if problems warrant that attention.

I thank you, Madam.

Mr Mukanga (Kantanshi): Madam Speaker, what is the ministry doing in the interim to ensure that our children are free from pneumoconiosis?

Professor Lungwangwa: Madam Speaker, the answer was very clear. The ministry has written to the relevant authorities requesting them to prevail over the mining company so that health hazards like sulphur dioxide is monitored and the levels are controlled through appropriate technology.

I thank you, Madam.

Madam Deputy Speaker: Clarify. Is it Luanshya or Mufulira?

Professor Lungwangwa: It is Mufulira.

I thank you, Madam

Ms Masiye: Madam Speaker, Libya right now is being paid compensation for the offences committed by the Bulgarian medical staff. There maybe some pupils there who may fall ill as a result of the dust. Is the Government going to wait until they pay so much compensation to thousands of pupils?

Professor Lungwangwa: Madam Speaker, I have already clarified the position of the Government with regard to that particular concern.

I thank you.

Hon. Opposition Members: No!

ZAFFICO/COPPERBELT FORESTRY COMPANY LIMITED WORKERS

712. Mr Simama (Kalulushi) asked the Minister of Tourism, Environment and Natural Resources how many workers Zaffico had and how many workers the Copperbelt Forestry Company Limited then had in the following areas:

(i) Kalibu Station;
(ii) Kafubu Depot Site;
(iii) Kitwe Sales Depot;
(iv) Lusaka Sales Depot; and
(v) Head Office.

The Deputy Minister of Tourism, Environment and Natural Resources (Ms Tembo): Madam Speaker, the Zambia Forestry and Forestry Industries Cooperation (ZAFFICO) had a total of 849 workers before privatisation in 2002. As of now, ZAFFICO Head Office in Ndola has a total of 31 workers.

The Copperbelt Forestry Company (CFC) Head Office in Kitwe has a total workforce of 20. As of today, the total number of employees at various stations is 449, broken down as follows:

(i) Kalibu Sawmill under CFC in Kalulushi   203

(ii) Kafubu Sawmill under CFC in Kitwe   187

(iii) Kitwe Sales Depot under CFC under Kitwe  10

(iv) Lusaka Sales Depot under CFC in Lusaka   29

(v) Head Office for CFC     20

I thank you, Madam Speaker.

ACCESS TO FOREIGN MARKETS

713. Mr Chimbaka (Bahati) asked the Minister of Commerce, Trade and Industry what measures the Government had taken to ensure the following:

(a) access to foreign markets; and

(b) adding value to local products before export.

The Deputy Minister of Commerce Trade and Industry (Ms Siliya): Madam Speaker, Zambia has been involved in a number of negotiations at the bilateral, regional and multilateral levels in order to secure access in foreign markets. A number of steps have been taken in this regard by Zambia or as part of a regional grouping or as part of a configuration of the LDCs group at the World Trade Organisation (WTO) and the Eastern and Southern African (ESA) configuration for the purposes of negotiating the EPAs with the EU. Specifically, Zambia has done the following:

At the multilateral level within the framework of the WTO,

(i) as coordinator of the LDC group leading up to the WTO Ministerial Meeting held in Hong Kong, China in December, 2005, Zambia succeeded in negotiating duty free and quota free market access into developed countries’ markets for a minimum of 97 per cent of the products originating from LDCs, and an understanding of the integration of the remaining 3 per cent for those countries with difficulties in implementing 100 per cent coverage immediately;

(ii) additionally, Zambia has negotiated for the simplification and making transparent the rules of origin that will apply to exports from LDCs;

(iii) to address the supply capacity constraints faced by developing countries, in particular the LDCs, an agreement was reached to have an Aid for Trade Package, which will result in substantial additional resources being provided for by the developed countries; and

(iv) the integrated framework LDC specific initiative was also approved for enhancement with respect to resources, timeframe of the programme, governance and the scope of areas to be supported.

Within the framework of our negotiations with the EU:

(i) under the EU relations, Zambia as part of the LDC group is a beneficiary of the ‘Everything But Arms’ (EBA) Initiative, which grants duty free and quota free markets access for essentially all products except for arms and ammunition and sugar. The special arrangement on sugar trade will be fully integrated into the EBA in 2009; and

(ii) as part of the Eastern and Southern Africa group of countries, Zambia is currently negotiating with the EU to conclude an EPA that will among other issues enhance market access through tariff reductions, simplification of rules of origin, elimination of non-tariff barriers and the provision of developmental assistance.

On the regional level, in the context of SADC, the SADC Trade Protocol was signed in August, 1996 at the Heads of State Summit held in the Kingdom of Lesotho to facilitate the lowering of duties by all member states on tradable goods. Zambia subsequently ratified the Trade Protocol in 2001.

The SADC Trade Protocol provides for the establishment of a substantive FTA by 2008 and a full FTA by 2012 when all products to be traded duty free among participating SADC countries.

The SADC regional grouping was the largest source of Zambia’s total imports accounting for 57 per cent and 59 per cent in 2005 and 2006 respectively.

In terms of trade flows, Zambia exported products worth US$ 729,030,763, whereas imports stood at US$1,473,677,166 in 2005.

The framework of COMESA provides both trade and economic expansion opportunities for Zambia. COMESA was created from the previous Preferential Trade Area for Eastern and Southern African States (PTA) at the end of 1994.

Currently, Zambia is a member of the COMESA Free Trade Area, and this means that products from Zambia can enter COMESA market duty free.

The volume of exports from Zambia into COMESA stood at US$256,482,387, whereas that of imports stood US$210,158,798 during the year 2005.

Further, through the Regional Integration Facilitation Forum (RIFF), Zambia has been able to draw resources to support projects related to cross border trade and investment.

On a bilateral level, Zambia is pursuing bilateral duty free and quota free market access on selected products with the Democratic Republic of Congo and Mozambique, as an interim measure whilst awaiting their full integration in to the COMESA and SADC regional integration programmes.

The response to the second question is that in order to encourage value addition in Zambian primary products, the Government has put in place the Zambian Development Agency Act No. 11 of 2006 providing a number of incentives to an investor in a priority sector or product by adding value to primary products.

For example, the Government under Part IV, Section 17(j) of the ZDA Act signed an Investment Protection and Promotion Agreement (IPPA) with the Zambia Sugar Plc for an expansion project amounting to US$195million for the processing of sugar cane into refined sugar.

In addition, we saw last year, the Zambezi Portland Cement and Chilanga Cement Companies increase and expand their investments and production as a result of attractive incentives brought about by the enactment of the ZDA Act.

Similarly, under Part VIII dealing with incentives for priority products of the ZDA Act, Universal Chemicals set up an iron and steel project in Kafue which will beneficiate iron ore into finished steel products for use in the building and construction industries.

Further, the Zambia Electricity Supply Corporation (ZESCO) in partnership with an Egyptian firm (El Sewedy) will soon start producing transformers and meter reading equipment in Ndola from copper cathodes. Due to the conducive investment climate, Zambia Metal Fabricators (ZAMEFA) has in recent years increased production of copper cables used in the construction, power and communication sectors both for the domestic and international markets.

It is expected that once the Multi-facility Economic Zones (MFEZ) in Chambishi and Lusaka South start operating, a number of firms in the mining and high tech sectors will add value to our primary products and ultimately propel services.

I thank you, Madam Speaker.

Mr Chimbaka: Madam Speaker, apart from Kafue Sugar, ZAMEFA and the iron ore industry in Mazabuka, are there any agro related industries that are adding value to their products? And if there any, what products are they producing?

Ms Siliya: Madam Speaker, there are quite a number of companies that are adding value to their products. We have got in the agro processing industry companies that are making tomato sauces from local tomatoes and so on and so forth. There is also Zambeef, which is actually exporting to Nigeria in West Africa. We, as a ministry, are working very closely with the Manufacturing Association of Zambia to address their production problems so that they can enhance the value addition and as they access foreign markets they, actually, get more value for their products.

I thank you, Madam Speaker.

Mr Muntanga (Kalomo): Madam Speaker, the answer states how hard the ministry is trying and that there is added value to local products. With all these efforts, may I know why the ministry is still allowing the export of raw tobacco when there are local processors?

Ms Siliya: Madam Speaker, even in our efforts, as a Government, through the Ministry of Commerce, Trade and Industry, to encourage our producers to add value to their local raw products, we do realise that there are a lot of supply constraints. We are just not dealing with product constraints such as market development and product development. There are a number of supply constraints that actually just make value addition quite expensive and ultimately making our products less competitive in the export market. This is why in our negotiations even within the context of Economic Partnership Agreements (EPA), the Government’s priority is on the development agenda even within the framework of the WTO so that we can address the soft and hard infrastructure issues that make our products uncompetitive.

Madam Speaker, let me just use my constituency as an example to illustrate this point. It is an agricultural constituency and there is a lot of potential to turn agricultural products into agro processing, but we have real infrastructural problems on the ground. There are issues such as of electricity, lack of road infrastructure and bridges. The Government is aware of this supply constraint. We are working very hard to try and convince our co-operating partners that as much as we want to adhere to the soft issues of capacity building, improving Government processes, improving the private sector so that it has the best international practice, we still have infrastructure issues on the ground that just ultimately make our products, even after value addition, uncompetitive on the international market.

I thank you, Madam Speaker.

Hon. Government Members: Hear, hear!

Major Chizhyuka (Namwala): Madam Speaker, in the hon. Deputy Minister’s explanation, she made reference to the iron and steel plant in Kafue. I would like to find out whether this Government does have a spine…

Laughter

Major Chizhyuka: …to address critical issues associated with the placement of the industry in public places. I am asking this question because I am mindful of the requirement by the Environmental Council of Zambia which dictated that you must remove that plant from there and yet, in the process, we have that plant which, in the near future, could be detrimental to the very people it is designed to serve. Do you have the spine, as a Government, to deal with such matters squarely?

Ms Siliya: Madam Speaker, let me assure the hon. Member of Parliament that, indeed, this Government has a spine.

Laughter

Ms Siliya: This is why at the close of 2006, we registered a lot of stability in the economy with inflation coming to single digit levels, with the GDP keeping to grow and truly being translated, as my hon. Minister always says, “into GDP in the pocket” …

Laughter

Ms Siliya: … with the exchange rate actually fluctuating.

Laughter

Ms Siliya: I am sorry. I mean the exchange rate actually being stable and foreign investment at an all time high. I think that is a clear reflection of the strength of the spine that my Government has.

Madam Speaker, coming back to the issue that the hon. Member of Parliament was raising, I think this Government has the responsibility to make sure that we attract investment so that we can expand our limited economy. If we do not, there will be no jobs and wealth created and we all cannot share poverty as I have said many times over. My Government is making sure that whatever investment comes into this country, it is in the best interest of our citizens because it is the citizens, ultimately, that this Government is here to serve so that we can reduce poverty in the country.

I thank you, Madam Speaker.

Hon. Government Members: Hear, hear!

Mr Chilembo (Chama North): Madam Speaker, may I know if the hon. Minister is aware that there is a shortage of maize bran in the country because most of it is being exported to neighbouring countries for their biscuit manufacturing industries. What is the Government doing to protect the local industries and people like me?

Hon. Opposition Members: Hear, hear!{mospagebreak}

Ms Siliya: Madam Speaker, let me first just reiterate what I have said on this Floor many times. The economic policy of this Government has been very consistent, and that is to have a liberalised approach. In all our businesses and transactions with our neighbouring countries, there are no barriers to trade. If in their right mind, the private sector want to access foreign markets because they see that as being competitive, it is what the Government would actually encourage because our policy is that we have a liberal approach to the economy.

However, the Ministry of Commerce, Trade and Industry always has measures in place, which are at the disposal of the minister that can be used if we feel there are unfavourable imports and also, sometimes, to try and reduce exports because, maybe, we have to deal with a situation at home, particularly, if it affected our staple food such as maize.

Madam Speaker, my answer to the hon. Member of Parliament is that the private sector are making a business decision and if they believe that the most attractive market is beyond the borders of Zambia, they will do that.

I thank you, Madam Speaker.

Mr Lubinda (Kabwata): Madam Speaker, the hon. Minister, in her answer said to this House that recently, through the ZDA, the Government signed an agreement for the investiment promotion and protection of Zambia Sugar Company. In answering one question, she said that this Government has a spine. I would like to find out whether this spine is not so rigid that it is bringing into play elements that are against the local consumer for the benefit of exports. Here, I have in mind the price of sugar which is sold locally by Zambia Sugar Company at US$950 per metric tonne and yet exported sugar from Zambia Sugar Company is selling for US$475 per metric tonne in Burundi. What is the reason of this? Is it because this economy has liberalised to the extent where Zambians must be subsidising foreign markets?

Hon. Opposition Members: Hear, hear!

Ms Siliya: Madam Speaker, I think first of all, in answering Hon. Lubinda’s question, it is very important that we do not compare apples and oranges but …

Mr Lubinda: Sugar and sugar!

Ms Siliya:… apples and apples.

Laughter

Ms Siliya: Madam Speaker, the Ministry Commerce, Trade and Industry is always in close contact with the Zambia Sugar Company. Obviously, the reason we wanted to attract this further investment in Zambia Sugar Company is that it must benefit the citizens. On the one hand is the provision of sugar on the market for the Zambian Citizens as consumers, but on the other hand, the importance of this investment is in terms of job creation and economic value it has brought to the town in Mazabuka. It is in terms of the corporate responsibility that Zambia Sugar is exhibiting.

The Ministry of Commerce, Trade and Industry is not here to defend Zambia Sugar Company. All I can do is inform this House that we are always in touch and deliberating with Zambia Sugar Company so that ultimately, they serve the citizens of this country where they have come to invest.

I thank you, Madam Speaker.

Mr Nkombo (Mazabuka): Madam Speaker, it is interesting to hear how this Government is addressing and articulating issues that surround the industry and the livelihood of our citizenry.

I would like to pose a question. If the hon. Minister and his colleagues in the Government actually do understand the ownership of this country, as they consider all these proposals. I am talking about the Kafue Steel Plant, the mine in Mufulira, which my colleague alluded to, and the Albidon Mine in my constituency. Is this Government aware that this country belongs to Zambians, and in looking at investment portfolios, they ought to first look at the interest of Zambians, before looking at the interest of investors?

Hon. Members: Hear, hear!

Ms Siliya: Madam Speaker, let me remind the hon. Members of Parliament that yesterday the Ministry of Commerce, Trade and Industry presented a ministerial statement in this House on Citizens Economic Empowerment. This was passed by the citizens, through you, as Members of Parliament representing them, because we all recognise that Zambians need to participate in the economic activities in a much more active manner.

We know the current problems on the ground and we are trying to address those issues that make it difficult for the citizens to participate through that Act. However, we also recognise that our private sector and our economic activities are limited, and if they are limited, then we will not be able to create more jobs and more wealth. So, we do need foreign investment.

Further, it is well articulated in the Zambia Development Agency (ZDA) policy that this Government will aggressively pursue foreign investment so that we can expand the private sector and encourage them to join ventures between the international private sector that wants to come and invest here with our local private investors. At the same time, we are taking deliberate measures to try and support our local private sector so that they can participate in some of the fast growing sectors of the economy.

Madam Speaker, looking at how much Zambians are participating in many sectors of the economy; you will see that as citizens, we are recognising that we should not sit back while the foreign investors are coming into the country. We also have to participate.

The ministry is working with the co-operation of EDF, the European Union, the Dutch …

Interruptions

Madam Deputy Speaker: Order!

Ms Siliya:…through the Private Sector Development Programme because we recognise the issue that the hon. Member is bringing out that Zambia is owned by Zambians and they have to participate in the economy. If we are going to politically, socially and economically sustain the economic growth of this county, there must be a sense of ownership.

We are very alive to your issue, and we are pursuing it actively.

I thank you, Madam.

PROVISION OF RADIO COMMUNICATION SYSTEM TO MUPETA, KALUNDU, AND MUSALANGO HEALTH CENTRES

714. Mr D. Mwila (Chipili) asked the Minister of Health when the Government will provide a radio communication system to the following health centres:

(a) Mupeta Health Centre;

(b) Kalundu Health Centre; and

(c) Musalango Health Centre.

The Minister of Health (Dr Chituwo): Madam Speaker, Mwense District has a total of twenty-three health centres, out of which sixteen have radio communication systems. Mupeta and Kalundu Rural Health Centres have already been fitted with radio communication equipment, which is functioning well.

Musalango Rural Health Centre is not yet operational, hence, the radio communication system is not yet fitted.

I thank you Madam Speaker.

Mr D. Mwila: Madam Speaker, I want to find out from the hon. Minister when he will send nurses and clinical officers to Chipili Constituency.

Madam Speaker, my elder brother, Hon. Chituwo, has permitted cleaners to be attending to patients…

Hon. Opposition members: Hear, hear!

Mr D. Mwila: … and he has just informed this House that he has procured radio communication systems. How are they going to operate the radios, seeing as they do not understand the English language? We expected that by now, we would have nurses in Mwense.

Dr Chituwo: Madam Speaker, I am grateful for that concern, and truly, it is our concern. I wish to reiterate what I said in this House, that the recruitment process has started. I did say that the Treasury Authority has granted authorisation to recruit 5,263 health workers. Therefore, as soon as all the formalities have been made, I can confidently say that we will be in a position to send some health workers to Mwense District, which will then deploy these health workers to various health centres.

It is regrettable that we have a condition like that, but as this House is aware, there are many factors that have led to the attrition of health workers in the country.

I thank you, Madam Speaker.

Ms Kapata (Mandevu): Madam Speaker, I would like to find out from the hon. Minister of Health how often his ministry calls the University Teaching Hospital (UTH) Help-Line, if it exists, to see how prepared the institution is for an emergency or national disaster.

Dr Chituwo: Madam Speaker, the hon. Member of Parliament for Mandevu was once in that profession, but she has probably forgotten.

The alert for emergency preparedness comes from several sources, for instance, the airport, the armed forces, or the police. It is the activation of such sources which tests the preparedness of UTH to receive mass casualties.

I thank you Madam Speaker.

Mr Chongo (Mwense): Madam Speaker, Musalango Rural Health Centre, which the hon. Minister said has got no radio communication system is in a remote part of Mwense District. Given the situation that we do not even have an ambulance to do the patrols, how does the hon. Minister expect SOS emergencies to be heard?

Dr Chituwo: Madam Speaker, Musalango is like many other areas in the country. Like any child, one has to start with the number one thing.

The health centre has just been completed, and there is only a temporal staff house. Therefore, until these things are in place, it is not possible to send a radio communication system where nobody will operate it.

I thank you, Madam Speaker. 

RESUMPTION OF THE KATIMA MULILO TOWN PORJECT

715. Mr Mwangala (Nalolo): asked the Minister of Works and Supply:

(a) when work on the Katima Mulilo Border Town project would resume since the project was fully funded; and

(b) whether the Government would take punitive action against the contractor who failed to complete the project by the stipulated deadline.

The Minister of Works and supply (Mr Simbao): Madam Speaker, I wish to inform the House that works on the construction of the new infrastructure at Katima Mulilo Border resumed last year on 27th October, 2006 under Yangts Jiang Enterprises Limited, a contractor who was awarded the contract at a contract sum of K15,898,883,580.00 to complete the works in fifty working weeks. An advance payment amounting to K4.4 billion was paid to the contractor last year.

In this year’s Budget, an amount of K4.5 billion was approved out of which K1.5 billion was released by the Ministry of Finance and National Planning in May, 2007 and has been paid to the contractor and consultants. The project is not fully funded to date, as only a total of K5.4 billion has been paid to the contractor, leaving a balance of K10.5 billion of the contract sum.

The project can only be completed within the scheduled time of fifty-three working weeks if funds are released on time. However, the contractor is working steadily and diligently on the project.

Madam Speaker, the contract of the contractor Nashinga/Emsworth Joint Venture was terminated. Any contractual obligations owed to the Government are being addressed through the Ministry of Justice.

The Government is in the process of recovering the advance payment from the contractor, Nashinga/Emsworth Joint Venture.

I thank you, Madam Speaker.

Mr Mwangala: Madam Speaker, is the hon. Minister aware that delays in taking punitive measures against contractors running away with funds meant for projects is so common now in the Western Province?

Mr Simbao: Madam Speaker, I would like to speak on behalf of the Ministry of Works ands Supply, but I think it is common in all Government ministries. We only have one lawyer and that is the hon. Minister of Justice.

Madam Speaker, when a contract goes into default or in this particular case, where a contractor runs into debt, our only option is to turn over the case to the hon. Minister of Justice. That is as far as we can go. Therefore, it is not a question of delays, but that of procedure.

I thank you, Madam Speaker.

MONEY RELEASED FROM THE GWEMBE SPECIAL FUND TO THE GWEMBE DISTRICT COUNCIL BETWEEN 2002 TO 2007

716. Mr Ntundu (Gwembe) asked the Minister of Local Government and Housing:

(a) how much money was released from the Gwembe Special Fund to the Gwembe District Council from 2002 to date;

(b) why the release of the funds at (a) above had not been consistent; and

(c) whether the Government had any plans to revise this fund upwards and if not, why.

The Deputy Minister of Local Government and Housing (Mr Kazonga): Madam Speaker, I wish to inform this august House that between 2002 and 2003, the Government released K96 million to the Gwembe District Council as Gwembe Special Fund. However, no funds on account of the Gwembe Special Fund was disbursed to the Gwembe District Council from 2004 to date because the Government removed the Gwembe Special Fund Vote from the ministry’s budget. This was because there was another project operated by the Government, through Gwembe Development Fund, which is administered by the hon. Minister of Energy and Water Development and funded by the World Bank.

Madam Speaker, the inconsistence of the release of the Gwembe Special Fund in the years it was released to Gwembe District Council was caused by budgetary constraints. As a grant, the Gwembe Special Fund could only be released after the Government had a surplus after disbursing the Recurrent Departmental Charges (RDCs) to ministries and other spending agencies.

Madam Speaker, there are plans under the Ministry of Energy and Water Development to consider another development programme for the Gwembe area since the Gwembe Development Fund Programme also ended in December, 2006.

 In addition, under my ministry, we are working on implementing the Decentralisation Implementation Policy whose objective is to increase budgetary allocations to all districts, including the Gwembe which takes into account the bottom-up planning and budgeting process.

Madam Speaker, this House has already approved the ministry’s budget for 2007, which has improved support to local authorities. Therefore, Gwembe District Council will receive increased funding for the provision of services to the people of Gwembe.

I thank you, Madam Speaker.

Mr Ntundu: Madam Speaker, there is no doubt that sometimes the Government means well. Therefore, I will not fault the Government when it means well.

Madam Speaker, believe it or not, these hon. Ministers you see here have no powers in their officers. The powers have been loaded on to their junior officers who are the Permanent Secretaries.

Laughter

Mr Ntundu: Madam Speaker, I would like to find out from the hon. Minister when the funds which were released by the hon. Minister of Finance and National Planning for the years 2001 to 2003 will be released to Gwembe District Council. When will you, hon. Minister, use your powers or force when need arises, like Hon. Mulyata who uses force when he needs something?

Laughter

The Minister of Local Government and Housing (Mrs Masebo): Madam Speaker, the answer from my ministry is that, between 2002 and 2003, K96 million was released to Gwembe District Council under the Gwembe Special Fund. However, you will note that in 2004, this fund was discontinued. In the Local Government Act, there is what they have called the Gwembe Special Fund in Dissolution. This means that it has been removed from the ministry’s vote. Therefore, as a ministry, we have not received any further releases against that vote. This is because, under a different sector ministry, which is Ministry of Energy and Water Development, the principal in the movement of the people from Gwembe to some other area to construct a hydro station for the purpose of supplying electricity to the country, they came up with another programme under the World Bank where resources were given for various projects in Gwembe. This project came to an end last year in December. And now, the Ministry of Energy and Water Development is looking for another possible programme to specifically fund the Gwembe people.

As a ministry, under the Decentralisation Implementation Programme, as opposed to having various programmes under various sector ministries, we have suggested that it is better that we have a fund that goes directly to the council, and the council, being a unit nearer to these people, can plan for the development of their areas. The only work we do at the central level is provide the resources.

So, there is no money that was given to my ministry to send to Gwembe. The only resources we have received, as a ministry, are general grants to all local authorities including Gwembe. Since 2002, every year, Gwembe District Council receives some resources, as general grant, for use as a district to improve service delivery to the communities.

I thank you, Madam Speaker.

TRANSFER OF THE ADMINISTRATION OF YDF FROM LOCAL AUTHORITIES TO THE OFFICE OF THE DISTRICT COMMISSIONER
717. Mr Chisala (Chilubi) asked the Minister of Sport, Youth and Child Development:

(a) why the administration of the Youth Development Fund had been transferred from local authorities to the Office of the District Commissioner; and

(b) what measures the ministry had taken to ensure transparency and accountability in the administration of the Youth Development Fund.

The Deputy Minister of Sport, Youth and Child Development (Ms Cifire): Madam Speaker, I wish to inform this august House that the administration of the Constituency Youth Development Fund (CYDF) has not been transferred from the local authorities to the District Commissioners’ Office as presumed in the question. This is evident in the Constituency Youth Development Fund Guidelines. The District Commissioner is a member of the Committee and is part of the Committee’s Secretariat and not that he has reserved power.

Madam, pertaining to the issue of measures that the ministry has taken to ensure that there is transparency and accountability in the administration of the Constituency Youth Development Fund, the following measures have been put in place:

The ministry has developed guidelines which outline the procedure for the administration of the CYDF. These guidelines have been circulated to all local authorities and the constituencies. The guidelines provide for:

(i) formation of Constituency Youth Development Fund Committees comprising of members of the public from a cross section of the community, including the youth themselves. The authority to spend or disburse money from any CYDF account rests exclusively on the CYDF committees; and

(ii) existence of a total of four signatories to the Committee’s bank account, two each for panels A and B. Any two of the signatories can sign the cheque, drawn on the Constituency Youth Development Fund account, one from each panel, provided that one of those signing is the Town Clerk, Council Secretary or District Commissioner.

(iii) The ministry has strengthened its inspectorate through recruitment of new staff …

Mr Kambwili: Ama District Commissioners basaina!

Ms Cifire: Ndelanda, mulelanda na futi.

Laughter

Ms Cifire: … which has made it possible to undertake periodic inspections and auditing of all CYDF accounts. The inspectorate from my ministry has visited all provinces and where anomalies have been identified, corrective measures have been taken.

I thank you, Madam Speaker.

Hon. Government Members: Hear, hear!{mospagebreak}

Mr Chisala: Madam Speaker, is the hon. Minister aware that some District Commissioners are politicising the disbursement of these funds?

Hon. PF Members: It is true!

Mr Kambwili: He is a former District Commissioner!

The Deputy Minister of Sport, Youth and Child Development (Mr Namulambe): Madam Speaker, the Member of Parliament is a former District Commissioner.

Hon. Government Members: Hear, hear!

Interruptions

Mr Namulambe: Unless he was practicing the same.

Interruptions

Mr Namulambe: I do not think the District Commissioners are politicising the disbursement of the funds because they are civil servants and not politicians.

I thank you, Madam.

Hon. Government Members: Hear, hear!

Mrs Sinyangwe (Matero): Madam Speaker, is the hon. Minister aware that it takes too long after submitting the list of names for the appointment to be made. This is August and very soon it is going to be the end of the year. Are you following up to see that the right thing is done?

Mr Namulambe: Madam Speaker, I am aware that it is taking long because the authority to offer appointment letters has been decentralised to Provincial Permanent Secretaries. In some cases, it has taken long because some Members of Parliament had objected to the membership of the committees.

Mr Kambwili: Yes, we objected! Twalikana!

Mr Namulambe: And as such, it took a bit of time.

I thank you, Madam.

Ms Mumbi (Munali): Madam Speaker, when we came into office, we found some committees in our constituencies which were put in charge of the Constituency Youth Development Fund. At the time these committees were put in place, Cabinet and Parliament had been dissolved. What criterion was used to select these youths to be in charge of the Constituency Youth Development Fund?

Hon. PF Members: Hear, hear!

Mr Namulambe: Madam Speaker, these committees do not belong to Members of Parliament.

Hon. Government Members: Hear, hear!

Mr Namulambe: The guidelines are very clear on who should be committee members. And there can only be a change of membership of a Member of Parliament as an individual and not a committee as a whole.

I thank you, Madam.

Hon. Government Members: Hear, hear!

Mrs Musokotwane (Katombola): Madam Speaker, may I find out from the hon. Minister who the signatories are supposed to be on Panel A or Panel B?

Mr Namulambe: Madam Speaker, two members either on Panel A or Panel B are supposed to be from the Public Service and two are supposed be members of the committee who are not public officers.

I thank you, Madam.

Mr Mwansa (Chifunabuli): Madam Speaker, I would like to find out from the hon. Minister whether he can assure this House that in situations where it will be discovered and proved that the officers, whether from the council or district commission, have been party to the misuse of this money, he will take disciplinary measures, including reporting them to the Anti Corruption Commission.

Hon.  PF Members: Hear, hear!

Mr Namulambe: Madam Speaker, I am on record as having warned people that when they misuse public resources, even if the prisons are congested, there is enough room for them and we will take them there.

Laughter

Mr Nkombo (Mazabuka): Madam Speaker, I would like to find out from the hon. Minister whether he is aware that in certain areas such as Mazabuka where I come from, the composition of members of the committee of the Youth Development Fund are people who have attained the age of eighty years. I would like him to confirm whether or not this is within the provisions of the guidelines for the composition of these committees.

Mr Namulambe: Madam Speaker, I am not aware that in Mazabuka where the hon. Member is a committee member, there are people who are about eighty years who are in that committee. However, if this person is representing a chief, he can that age because he is representing a traditional ruler according to what is provided for in the guidelines.

Interruptions

Mr Namulambe: However, the youths themselves are supposed to be below the age of thirty-five because according to the Youth Policy, the age of a youth is between fifteen and thirty-five.

Madam Speaker, there are some hon. Members here who are above the age of thirty-five, but are members of this committee. So I do not know whether I should remove them from the committee because they are over age.

I thank you, Madam.

Interruptions

Mr Kapeya: Madam Speaker, could the hon. Minister inform this House when there will be the next allocation of the Youth Fund since we only have four months before the year ends.

Mr Namulambe: Madam Speaker, if I remember correctly, it was only yesterday or the other day when I mentioned that there was no provision for Constituency Youth Development Fund in this year’s Budget. So unless the hon. Member has seen something in the Estimates for 2007, we will be able to release the funds before the end of the year.

I thank you, Madam.

Mr Malama: Madam Speaker, I would like to find out from the hon. Minister if there are plans by the ministry to increase the same fund, …

Interruptions

Mr Malama: … because looking at what is being given to constituencies and considering the number of youths in these constituencies, I feel it is not enough to cater for all the youths in these constituencies.

Mr Namulambe: Madam Speaker…

Madam Deputy Speaker: Order!

Business was suspended from 1615 hours until 1630 hours.

Mr Namulambe: Madam Speaker, when business was suspended, I had just started answering the question asked by the hon. Member for Mfuwe.

Madam Speaker, my ministry has no plans to increase the Constituency Youth Development Fund. Instead we have done away with the fund and we are trying to develop other neutral ways in which we can help our youths in the constituencies, because we have realised that people who are not youths are trying to take advantage by politicising the disbursement of the Constituency Youth Development Fund. We will find a more appropriate way to help our youths who are in dire need of capital funding.

I thank you, Madam.

_____________

BILLS

FIRST READING

The Minister of Justice (Mr Kunda): Madam Speaker, I am a bearer of a message from His Excellency the President recommending favourable consideration of the Motion which I now lay on the Table.

Mr Kunda laid the paper on the Table.

Mr Kunda: Madam Speaker, I beg to present a Bill entitled the National Constitutional Conference Bill, 2007. The objects of this Bill are to:

(a) establish the National Constitutional Conference and find its composition, functions and powers; and

(b) provide for matters connected with or incidental to the foregoing.

I thank you, Madam.

Madam Deputy Speaker: The Bill stands referred to the Committee of Legal Affairs, Governance, Human Rights and Gender Matters. The Committee is required to submit its report on the Bill to the House by Thursday, 16th August, 2007. Hon. Members who wish to make submissions or amendments to the Bill are free to do so within the programme of work of the Committee.

SECOND READING

THE EXCESS EXPENDITURE APPROPRIATION (2004) BILL, 2007

The Minister of Finance and National Planning (Mr Magande): Madam Speaker, I beg to move that the Bill be now read a second time.

Madam Speaker, when this House constituted the Public Accounts Committee on 30th January, 2004, a number of resolutions were made and one of them was to review and make recommendations on all matters relating to the Financial Year ending 31st December, 2004. Of the recommendations accepted by the House was one relating to the Excess Expenditure in the sum of K136, 185,524,018, hence the Bill before this august House which, therefore, is meant to regularise this excess or unconstitutional expenditure incurred during that financial period.

Madam, this matter, like I have indicated, was raised in 2004 and was exhaustively debated when the House considered the 2004 Financial Report, Auditor-General’s Report and the Report of the Public Accounts Committee. I, therefore, do not expect that there will be a lot of debate.

Madam Speaker, I seek the support and approval of this House of this Bill.

I beg to move.

Mr Beene (Itezhi-tezhi): Madam Speaker, allow me to brief this august House as regards your Committee’s deliberations pertaining the Excess Expenditure Appropriation (2004) Bill, 2007.

Madam, the Bill was presented to the House pursuant to Article 117(5) of the Constitution, which states and I quote:

‘where in any financial year, expenditure has been incurred without the authorisation of Parliament, the minister responsible for finance, shall on approval of such expenditure by the appropriate Committee of the National Assembly, introduce in the National Assembly, not later than thirty months after the end of the Financial Year or if National Assembly is not sitting at the expiration of the period within one month of the First Sitting of the National Assembly, thereafter, a Bill to be known as Excess Expenditure Appropriation Bill for the approval by Parliament, of such expenditure.’

Madam Speaker, in other words, the Bill merely seeks to confirm the expenditure totaling K136,185,524,018 in excess of the monies appropriated for the services of the Republic by the Appropriation Act, 2004 and the Supplementary Appropriation (2004) Act, 2006. Considering that the Financial Year in issue ended on 31st December, 2004, the presentation of the Bill is within the constitutional time limits for presentation of such a Bill.

Notably, Madam, such expenditure cannot technically be termed unconstitutional due to the fact that the Constitution recognises and envisages it. To this effect, procedure is provided within the Constitution for regularisation of such expenditures.

As regards the reason for excess expenditure, your Committee note that generally, the following were the commonly cited reasons for excess expenditure incurred by the various ministries, provinces and spending agencies covered by the Bill:

Low Ceilings set at the Time of Budgetting

Madam Speaker, your Committee learnt that at the time of budgeting, various Government agencies had to maintain their budgetary estimates within the ceilings set by the Ministry of Finance and National Planning. The ceilings were often too low to accommodate all the operational requirements of the Government agencies. In any case, during the budgetary hearings, some activities had to be removed from the budgets of the ministries or Government departments for them to remain within their ceilings.

Late Release of Funds

Madam, it was clear to your Committee that due to the lack of consonance between the inflow of the revenues and expenditure demands on the Treasury by the various Government departments and agencies, funds tended to be released to the spending agencies very late in the year, after the Supplementary Estimates had been approved by the National Assembly. This contributed to the large amounts spent without parliamentary approval.

Carry-Over of Funds from Previous Years

Madam Speaker, in some cases, funds approved for use in the 2003 Financial Year were carried over and spent in the 2004 Financial Year, resulting in excess expenditure.

Failure to Process Documents to Regularise Expenditure

Madam, your Committee know that some controlling officers simply failed to process appropriate documentation in time to regularise their expenditures through the Supplementary Estimates. There were also cases where the controlling officers submitted all relevant documents in time, but the Ministry of Finance and National Planning failed to include the expenditure in the Supplementary Budget.

Madam Speaker, your Committee are concerned with the use of excess expenditure appropriations to pay for regular activities such as personal emoluments. This trend is worrying. Your Committee reiterate that expenditures without parliamentary scrutiny and approval should be discouraged, as a possibility of abuse of public funds in such cases is higher.

In this regard, your Committee wish to place on record their concern as regards the handling of funds received from the United Nations for Peace Keeping Missions by the Zambia Army, which constituted part of the excess expenditure under consideration. In this regard, your Committee call upon the hon. Minister of Finance and National Planning to be conscientious in ensuring that the funds are properly handled.

Further, your Committee are of the view that excess expenditure should be the exception rather than the norm. As regards the specific causes of the excess expenditure, your Committee call on all controlling officers in revenue collecting ministries to prioritise revenue collection activities so that adequate funds are available on a timely bases for implementation of public programmes and projects.

They also urge the Secretary to the Treasury to ensure the processing of relevant documents by all controlling officers and by officials within the Ministry of Finance and National Planning is done effectively and efficiently, so as to avert unnecessary incidences of excess expenditure.

Madam Speaker, in addition, your Committee wish to express serious concern over the fact that the Constitution does not provide for a check against expenditure of public funds without recourse to Parliament in the case of excess expenditure. Therefore, they call for appropriate amendments to the Constitution in order to enhance parliamentary scrutiny of all public expenditure.

Madam, subject to their observations above, your Committee recommends favourable consideration, by the House, of the Excess Expenditure Appropriation (2004) Bill, 2007.

I thank you, Madam.{mospagebreak}

Mr Magande: Madam Speaker, I wish to thank the Chair for this Committee which went through this particular Motion.

As he has indicated clearly, there are issues that are of concern while we are covered by the Constitution and I want to assure him that my ministry is also concerned that even where perhaps there has been lapse or lack of proper action by the officers, this is covered by the Constitution. I think what we need to do is to clearly state which particular actions can be covered by law and which ones should be punishable even if they are covered by the law. If somebody does not fulfill the requirements for documentation by the end of the year and we end up reporting this expenditure two years later, it is not fair to the people that would have wanted to look at our expenditure for that year. I want to assure this House that we are looking at all these issues and obviously, since they concern the amendment to the Constitution, I hope that we will all be alive when we go to the Constitution Conference and try to bring these positive amendments.

I thank you, Madam.

Question put and agreed to and the Bill read a second time.

Committed to a committee of the whole House.

Committee on Friday, 3rd August, 2007.

THE PENAL CODE (Amendment) BILL, 2007

The Minister of Justice (Mr Kunda, SC): Madam Speaker, I beg to move that the Bill be now read a second time.

Madam Speaker, the existing legislation pertaining to malicious damage or destruction to property is inadequate and requires to be strengthened in order to combat the high incidences of vandalism. Most of the current legislation ties malicious damage or destruction to property to the intent to merely destroy property or to endanger the lives of the persons using the property. However, the motive to underline such destruction or damage has changed radically today. Vandalism of property is used as a tool for individual economic gain or other personal benefit.

Madam, the object of this Bill that I am introducing to this august House is to strengthen the law so that this loophole is sealed and vandalism, whatever the motive underline it, is criminalised. Vandalism is a vice that has affected both the private, public sector and private persons. Vandalism of Public Service infrastructure has resulted in loss of resources essential to national development and the denial of access to essential public services, such as, electricity, water supply and the use of railway systems among others. This has adversely affected the quality of life of the people.

In addition, corporations that offer these services have spent and continue to spend colossal sums of money on the replacement of repair of vandalised property. This has translated into a general loss of resources for such corporations and where the corporation providing the service is a public one, has imposed a huge strain on the country’s financial resources. Private property has also been subject to vandalism. Vandalism has deprived the owners of such property of resources necessary for their economic development or other benefit. Thus imposing hardships on them which may in some instances prove dismountable.

Madam, it is clear from the foregoing that vandalism has derailed and will continue to derail the development of this nation and its people. It is imperative, therefore, that the existing legislation be strengthened so that stiff penal sanctions are imposed to deter potential offenders.

In concluding, Madam Speaker, I wish to thank the committee for the useful observations made on the bill. We have considered the observations and we will bring amendments to effect the recommendations particular to substitute life imprisonment for the death penalty where an act of vandalism results in the death of a person.

Madam Speaker, this Bill is progressive and long overdue and I urge hon. Members of this august House to give it their full support.

I thank you, Madam.

Hon. Government Members: Hear, hear!

Mr Mwiimbu (Monze): Madam Speaker, I would like to thank you most sincerely for according me this opportunity to brief this august House on the matters pertaining to the Penal Code (Amendment) Bill, 2007, National Assembly Bill No. 19 which was referred to your Committee on Legal Affairs, Governance, Human Rights and Gender Matters on 12th July, 2007, for scrutiny.

Madam Speaker, your Committee were determined to consult widely in order to enrich the consultation process on this very important bill. Your Committee invited various stakeholders to make both written and oral submissions before them. Your Committee went further to seek the counsel of the Attorney-General who appeared before them to clarify issues that had been raised by stakeholders. Notwithstanding the brevity of time, your Committee received overwhelming response and trust that the hon. Members will find the report useful as they debate the bill.

Madam Speaker, before I highlight the contents of the report, let me say that your committee was alive to the fact that the bill that is before the House is a serious matter. Improperly handled, it could fracture the very foundation of our democracy and economic behaviour. It is, therefore, an opportunity for this House to enact a good law that could address the issue of destruction of vandalism to public and private property which has been on the increase lately in our country.

Madam Speaker, the witnesses of your Committee all registered support for the Bill. In so doing, however, they brought out a number of concerns to the attention of your Committee. The concerns are recorded in your committee’s report for the consideration of the hon. Members of this House as they consider the bill.

Madam Speaker, I will now take a look at specific aspects of the Bill. One of the contentious issues your committee was confronted with was the inclusion of the death penalty where vandalism or arson resulted in the death of any person which the Bill proposes. I am happy to note that the hon. Minister of Justice is taking corrective measures over this. In this regard, your Committee wish to satisfy themselves that the Bill was in line with the human rights principles before making the recommendations. They also wanted to establish if it is recognised and respected that the right to life is enshrined in our Constitution. The view of your Committee is that this aspect of the Bill does not support the human rights spirit which is cardinal.

They are also concerned that the proposed Bill seeks to place a sealing in terms compensation to the value of the property damaged or lost. Your Committee contained that this should not be the case. To this effect, your Committee proposed that:

(i) the amendment of section 30 to provide for compensation for damaged or lost value taking into account the value of the property plus other costs such as cost of installation and also carry some penal element;

(ii) the Committee know that the imposition of the death penalty under the various provisions where there is vandalism or arson results in the death of a person should be replaced by long-term or life imprisonment, taking into account the circumstances of each case.

Madam Speaker, the intention of proposed amendment is to formulate legislation in keeping with the need to maintain stiff deterrent penalties whose gravity corresponds to the extent of the malicious damage. Your Committee would like to urge the House to consider this Bill favourably.

In conclusion, your Committee wish to record and express their appreciation to the witnesses who made submissions before it. The Committee are also thankful to the Attorney-General for accepting to appear before them and clarify issues that have been raised by other stakeholders. Finally, I wish to commend members of your Committee and the Clerk’s Office for their dedication to duty during the consideration of the Penal Code Amendment Bill.

Thank you, Madam.

Mr Kunda: Madam Speaker, I wish to sincerely thank this august House for the overwhelming support that this Bill has received.

I thank you, Madam.

Question put and agreed to and the Bill read a second time.

Committed to a committee of the whole House.

Committee on Wednesday, 8th August, 2007.

____________

MOTION

ADJOURNMENT

The Minister of Finance and National Planning (Mr Magande): Madam Speaker, I beg to move that the House do now adjourn.

Question put and agreed to.

___________

The House adjourned at 1659 hours until 0900 hours on Friday, 3rd August, 2007. 
___________

WRITTEN REPLY TO QUESTION

INCREASING OF GRANT TO CHAINAMA HILLS COLLEGE HOSPITAL

708. Mr Malama (Mfuwe) asked the Minister of Health when the grant to Chainama Hills College Hospital would be increased.

The Minister of Health (Dr Chituwo): Madam Speaker, training institutions under the Ministry of Health are funded on the basis of the number of students. Prior to 2005, funding to all training institutions was channelled through the associated hospitals. Since 2005, funding to Chainama Hills College Hospital has more than doubled due to additional funds in the Training Institutions Basket from donors. In 2004 for example, Chainama College used to get grants averaging K40 million per month whereas the current monthly grant to the institution is more than K226 million.

I thank you, Madam.