DAILY PARLIAMENTARY DEBATES FOR THE FIRST SESSION OF THE TENTH ASSEMBLY

Friday, 23rd March, 2007

The House met at 1430 hours

[MR SPEAKER in the Chair]

NATIONAL ANTHEM

PRAYER

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ANNOUNCEMENT

WORKSHOP FOR MEMBERS OF PARLIAMENT WHO HAVE BEEN ALLOCATED CONSTITUENCY OFFICES

Mr Speaker: Hon. Members, I wish to inform the House that I have approved a workshop for Members of Parliament, who have been allocated Constituency Offices to be held in the Amphitheatre on Monday, 26th March, 2007. The workshop will commence at 0900 hours.

The workshop will focus on the role of the constituency office, the role of the Members of Parliament in the office and the role of constituency office staff and how they should interface with the Members of Parliament. Hon. Madam Deputy Speaker, will open the workshop. I invite all concerned hon. Members to be present.

Thank you.

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Mr Speaker: May the hon. Acting Leader of Government Business indicate business of the House for next week.

BUSINESS OF THE HOUSE

Minister of Defence (Mr Mpombo): Mr Speaker, I rise to give the House some idea of the business it will consider next week.

Sir, on Tuesday, 27th March, 2007, the business of the House will begin with questions, if there will be any. This will be followed by presentation of Government Bills, if there will be any. Thereafter, the House will go into Committee of Supply on this year’s Estimates of Revenue and Expenditure and will consider the following Heads:

Head 78  –  Office of the President – Zambia Security Intelligence Service; Head 80  –  Ministry of Education 
Head 85  –  Ministry of Lands.

On Wednesday, 28th March, 2007, the business of the House will begin with Questions, if there will be any. This will be followed by presentations of Government Bills, if there will be any. Thereafter, the House will consider Private Members’ Motions, if there will be any. On this day, the House will also consider the second reading of the Supplementary Appropriation 2005 Bill that was referred to the Committee on Estimates for examinations.

Thereafter, the House will resolve into Committee of Supply on this year’s Estimates of Revenue and Expenditure and will consider the following Heads:

Head 87  –  Anti-Corruption Commission;
Head 51  –  Ministry of Communication and Transport; and 
Head 68  –  Ministry of Tourism, Environment and Natural Resources.

On Thursday, 29th March, 2007, the business of the House will begin with Questions, if there will be any. This will be followed by presentation of Government Bills, if there will be any. Thereafter, the House will resolve into Committee of Supply on this year’s Estimates of Revenue and Expenditure and will consider Heads 90 - 98 in two provinces.

Sir, on Friday, 30th March, 2007, the business of the House will begin with the Vice-President’s Question Time. Then, the House will consider Questions, if there will be any. This will be followed by presentation of Government Bills, if there will be any. Thereafter, the House will resolve into Committee of Supply on this year’s Estimates of Revenue and Expenditure and will continue considering the provincial heads of expenditure.

Mr Speaker, I thank you.

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QUESTIONS

RE-INTRODUCTION OF STUDENT ALLOWANCES IN TEACHERS’ TRAINING COLLEGES

375. Mr Chisala (Chilubi) asked the Minister of Education whether the Government had any plans to re-introduce student allowances in teachers’ training colleges to alleviate the financial hardships students are currently experiencing.

The Deputy Minister of Education (Ms Changwe): Mr Speaker, the hon. Member for Chilubi asked my ministry, whether the Government has any plans to re-introduce students’ allowances in Teachers’ Training Colleges to alleviate the financial hardships students are experiencing currently.

In fact, I would like to inform the hon. Members that we no longer call them Teachers’ Training Colleges, but Colleges of Education.

Mr Speaker, the Government has no immediate plans to re-introduce student allowances in Colleges of Education, for the reason that these colleges are currently running on a cost-sharing basis. Therefore, students are expected to provide, as part of cost sharing, the component for their up keep. However, the Government will provide teaching practice allowances in order to enable the students conduct their teaching practice at locations that their respective college administrations will choose.

For students that would like to conduct their teaching practice while staying with relations, such allowances will not be paid.

I thank you, Sir.

Mr Chisala: Mr Speaker, is the hon. Minister aware that during the Kaunda era so many teachers were trained as a result of same the allowance?

Ms Changwe: Mr Speaker, my ministry is aware that in the Kaunda era, there were such allowances. At the moment, the policy is that we should undertake cost-sharing measures and as such, some teachers have been complying with that policy. Therefore, I do not see anything wrong with cost sharing.

I thank you, Sir.

Mr Mwiimbu (Monze): Mr Speaker, is the hon. Minster not aware that a number of students in these colleges are unable to provide for themselves, due to the failure by the Government to provide bursaries or any other financial assistance to them?

The Minister of Education (Professor Lungwangwa): Mr Speaker, the principle of cost sharing is extremely important for the Government and it has taken root in our education system, especially at the tertiary level. Therefore, we do not see any justified reason to upset a principle that is operating effectively.

I thank you, Sir.

Mr Sikota (Livingstone): Mr Speaker, in view of the fact that we have extremely high poverty levels in Zambia, I would like to find out whether the Government is considering introducing a way of moderating the cost sharing by offering loans to students, who cannot afford the cost sharing, to allow them access these facilities.

Professor Lungwangwa: Mr Speaker, the policy on loans in tertiary education was established in 2004. At the moment, it is only operating at the university level. It is still being monitored to see how it will work out before it can be extended to other tertiary educational institutions.

I thank you, Sir.

Mrs Sinyangwe (Matero): Mr Speaker, is the hon. Minister aware that the student teachers, who go out for teaching practice, engage themselves in illicit sex and have marriages of convenience to raise some money for their up-keep?

Professor Lungwangwa: Mr Speaker, the ministry trains professionals who are supposed to exhibit the highest level of professional integrity. Such kind of unbecoming behaviour is not monitored by the ministry.

I thank you, Sir.

Mr Mukanga (Kantanshi): Mr Speaker, the hon. Minister stated that they are monitoring the main facility at the university level. I would like to know how long it will take to monitor the facility before it can be implemented at the college level.

Professor Lungwangwa:  Mr Speaker, there are a number of technical factors, which have to be put in place. For instance, we have the complex process of loan recovery and the establishment of an institutional mechanism to recover the loans. There are a number of other technical and managerial aspects to ensure that the loan is operating effectively. Therefore, as a Government, we have to be sure that the loan scheme will operate successfully to cover all the prospective students before a decision is made to broaden it.

This is what has happened in a number of countries that have introduced a student loan scheme. It is not a scheme that you can haphazardly implement across the entire tertiary education sector. Time is needed to study it, and ensure that it operates in the interest of the nation.

I thank you, Sir.

Mr Muntanga: Mr Speaker, according to the hon. Minister, cost-sharing measures have taken root in the Ministry of Education. I seek clarification on whether this is the main reason that standards of education have gone down in both management and the passing rate of students. Is it because the pupils are suffering?

Professor Lungwangwa: Mr Speaker, I am not quite sure what Hon. Muntanga is referring to. Although, if it is a question of understanding how the cost-sharing principle is operating, it starts at the high school level. Quite a number of students in high schools pay boarding fees. I am also sure that there are a number of hon. Members here, who are paying boarding fees for their children. That is the beginning and it extends to the colleges as well. Even at the university level, there is cost sharing as students have to pay part of the cost of their university education. Therefore, we do not see a problem in that regard.

I thank you, Sir.

Mr Nkombo (Mazabuka): Mr Speaker, I would like to find out from the hon. Minister if he is aware that, as a result of this cost-sharing policy introduced by the ministry, the Government has failed to retain teachers and integrate them in our education system in a long term fashion, and they are leaving the country to go abroad and teach.

If the hon. Minster is aware, what is the ministry doing about it?

Professor Lungwangwa: Mr Speaker, we have been talking about quite a number of teachers who, at the moment, have not been absorbed in the education system. We are in the process of absorbing those teachers. Therefore, this is an indication that there is a large number of teachers who are trained and would like to join the teaching profession. Regarding those who have gone abroad, I do consider it to be a temporary phase in our country. Quite a number of them have come back. Thus, the economic realities of this country and the improvements which are taking place are, to large extent, attracting other members of staff to remain in the country. Consequently, I do not think that is a major concern at this stage, as the economy has improved.

I thank you, Sir.

Ms Masiye (Mufulira): Mr Speaker, in Bemba, there is a saying ‘apakomaila nondo ninshi pali ubulema’, meaning, when people have … how do I say this …

Laughter

Ms Masiye: … when people keep talking about the same point, then there is a defect. We cannot afford to turn a blind eye to …

Mr Speaker: Order! Please, ask your question.

Ms Masiye: Mr Speaker, given the statement by the hon. Minister of Education on the cost-sharing policy vis-à-vis the poverty levels, illicit relationships as a means of survival, does the hon. Minister realise that it is important not to simply train teachers, but retain these professionals because they do not become professions until they qualify.

Professor Lungwangwa: There is a difference between Training and Retention. Retention has to do with conditions of service which are payable when one has been trained and employed. As a ministry, we have taken a number of measures to ensure that we retain our professionals in the educational sector. For instance, we have loan schemes that are in place for the teachers. To a large extent, we are paying attention to other conditions of service which will retain them in the system, including the improvements in the teaching learning environment. That is the retention side, which we continuously address as a Government.

I thank you, Sir.

Mr Chimbaka (Bahati): Mr Speaker, I would like to find out whether there is a provision in the policy of cost sharing that allows students who fail to raise money to pay in kind, for example, cattle, fish or goat in order to access tertiary education.

Laughter

Professor Lungwangwa: Mr Speaker, we do not operate in a barter system. We operate in a money economy. Arrangements for easing the difficulties of the students in our colleges are done by the college management. There are mechanisms to address the difficulties that students face in paying their fees.

I thank you, Sir.

Mr Lubinda (Kabwata): Mr Speaker, in response to one of the questions, the hon. Minister said that teachers in the diaspora have started returning. In view of a high pupil: teacher ratio that obviously must be very beautiful music to the ear, what can you say? Are some teachers returning because their contracts have expired or is it because they think that conditions of service for teachers in Zambia have improved? Which is which? Can you state how many teachers have returned ever since you became hon. Minister of Education?

Professor Lungwangwa: Mr Speaker, I think we should understand the circumstances that surround our neighbours. When a number of our professionals, in this case, teachers, ran to countries such as Botswana, Namibia and South Africa, the conditions were such that those countries needed highly trained manpower to man their schools. Over the years, those countries have been able to achieve their human resource levels. They no longer, at the moment, require as many of the foreign teachers as they did when they went there.

Consequently, a number of our teachers who have been going to those countries have not had their contracts renewed and are returning to Zambia and this is a fact. Therefore, if they are returning to this country, of course, it is because the employment prospects in those countries are dwindling. Secondly, Zambia is increasingly becoming attractive therefore, they are returning home, and this is a fact.

Hon. Opposition Members: Aah!

Professor Lungwangwa: I thank you, Sir.

PAYMENT OF PENSION AND NAPSA DUES TO EX-RAMCOZ EMPLOYEES

376. Mr Kambwili (Roan) asked the hon. Minister of Finance and National Planning when the ex-RAMCOZ employees would be paid their Mukuba Pension and NAPSA dues.

The Minister of Finance and National Planning (Mr Magande): Mr Speaker, the Roan Antelope Mining Corporation of Zambia (RAMCOZ (in receivership) had huge employee liabilities on its books. The Government decided to assume all employee liabilities in relation to ex-RAMCOZ employees. However, considering that there were a number of liabilities that required allocation of scarce resources, the Government had to come up with a priority plan for liquidating the employee liabilities at RAMCOZ (in receivership).

The first priority was to ensure that the workers got their salary arrears and terminal benefits. As is already well known, in 2004, the Government paid the ex-RAMCOZ workers, a total of K174 billion in salary arrears and terminal benefits. The second priority was to ensure that the workers were paid their pension benefits. This meant that the Government had to settle outstanding pension contributions on behalf of RAMCOZ to a number of institutions that receive statutory payments. These included:

(a) Workers’ Compensation Fund, which was owed K2.7 billion. I am happy to say that this amount has been provided for in the 2007 Budget;

(b) Mukuba Pension Trustees Limited was owed K8.7 billion in pension contributions. Again, here, I am happy to inform the august House that this amount is provided in the 2007 Budget; and

(c) National Pension Scheme Authority (NAPSA) was owed K11.3 billion as unremitted contributions. The Government, through a debt-swap agreement settled this amount in full as unremitted pension contributions and it also included part of the penalty charges which had been imposed for not remitting the money.

I thank you, Sir.

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BILLS

SECOND READING

CUSTOMS AND EXCISE (Amendment) BILL, 2007

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

Sir, as is clearly indicated, this is one of the revenue raising measures and I would like the House to support it.

I thank you, Sir.{mospagebreak}

Mr Imenda (Lukulu East): Mr Speaker, allow me to acquaint the House with some pertinent issues that arose during your Committee’s deliberations on the Customs and Excise (Amendment) Bill.

During the deliberations, your Committee interacted with a number of stakeholders who expressed various observations and concerns over the measures in the 2007 Budget, some of which have been included in the Customs and Excise (Amendment) Bill. This was a welcome move as it would free resources for re-investment by business operators. However, it was reiterated that there was need for the Rural Electrification Fund to receive the full extent of the funds collected as Rural Electrification Levy.

In addition, it is necessary, in view of the huge electrification requirements in the country, that companies, particularly those in the mining industry, that have hitherto been exempt from paying this tax, should no longer be exempt,.

The reduction of duty in the premixes from 25 per cent to 5 per cent will go a long way in sustaining growth in the livestock industry. It was stressed that the private sector would only become more efficient and effective if concerted effort was invested in reducing the cost of doing business. The private sector is currently not competitive in domestic, regional and international markets because Zambia is still a high cost environment for business.

Excise Duty on Air Time

It had been hoped that the excise duty introduced in February, 2004 as a consumer tax on all air time sales would be removed in 2007. This being a consumer tax, effectively meant a direct increase in the tariffs as a customer had now reduced minutes of use for the same amount previously spent on air time. It was proposed that this tax be reduced to 5 per cent with a view to removing it altogether as to increase sale volumes, which would mean more domestic VAT revenue. More revenue for the operators would encourage deployment of services to the less economically active areas of the country.

Excise Duty on Mineral Water

It was proposed that the direct excise tax of 10 per cent on mineral water be stopped as it was punitive to certain participants. This loss in revenue could be replaced by imposing 5 per cent customs duty on manufacturing of packaging used in the semi-industries which were currently zero-rated. This proposal would then ensure that the Government collected its revenue at the point of entry into the country and would effectively widen its tax base into the entire beverage industry.

Duty Free Import on Distilled and Conductivity Water

Some stakeholders urge that allowing distilled and conductivity water to enter Zambia duty free would create a potential loophole for international entrants into the water sector, especially since these waters could be processed locally quite easily.

Sir, having interacted with various stakeholders, your Committee in their report have made various observations and recommendations with regard to the Customs and Excise (Amendment) Bill. Your Committee support the measures proposed under the Bill. Nevertheless, they call on the Government to consider the various issues raised by stakeholders for implementation in future budgets.

However, let me reiterate your Committee’s recommendations on the need for the full release of the Rural Electrification Levy in the Rural Electrification Authority once collected so as to accelerate the pace of rural electrification. In addition, your Committee reiterates the need for the immediate review of rebates on the electricity levy granted to some companies.

Mr Speaker, another issue encountered by your Committee during their deliberations was that the timeframe for the conclusion of their work was very limited. Your Committee noted that the National Budget was presented to the House later than is conventionally the case and this could be one of the factors contributing to this problem. This proved to be a constraint in that most witnesses could not undertake adequate research before making their submissions. Some of these witnesses, in fact, failed, through no fault of their own, to appear before your Committee. This is a major source of concern to your Committee and they are hopeful that this matter will receive favourable consideration expeditiously.

Further, Sir, your Committee were dismayed to note that despite being invited to do so, no Members of Parliament made submissions to your Committee. This is worrying to your Committee as Members of Parliament are expected to take advantage of the opportunity availed to them, through the Committee system, to contribute to the consultative process on matters of national importance, such as, budget legislation, which your Committee were considering.

Finally, Mr Speaker, may I pay tribute to you, Sir, for your guidance throughout your Committee’s deliberations. I also thank all my colleagues serving on your Committee for their commitment and dedication to the Committee’s work. In addition, I wish to thank the Office of the Clerk of the National Assembly for their unfailing assistance and services to your Committee throughout the deliberations. Lastly, Sir, I wish to note and convey your Committee’s appreciation of the role played by the consultant to the National Assembly in assisting with the analysis of the 2007 Budget and consideration of the Bills.

Mr Speaker, I thank you.

Mr Magande: Thank you, Mr Speaker, for giving me the opportunity to wind up the debate on this particular important aspect of our revenue measures in the budget.

Mr Speaker, looking through the report of the Committee, I note that on page 33, the Committee said the following:

‘They, however, call on the Government to consider the various issues raised by the operators in this sector for implementation in future budgets.’

Mr Speaker, this clearly indicates that the Committee appreciates what we are trying to do in this Bill. I also want to say that the lamentations by the Chairman that hon. Members did not appear before this Committee is a blessing for us because it indicates the hon. Members of this august House do clearly understand the measures that we are proposing in this particular Bill. Therefore, I would like to appreciate this understanding as it shows that they are all working towards fulfilling the intentions of the 2007 Budget.

I thank you, Sir.

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

Committed to a committee of the whole House.

Committee on Tuesday, 27th March, 2006.

THE MINES AND MINERALS (Amendment) BILL, 2007

Mr Magande: Mr Speaker, I beg to move that the Bill be now read a second time.

Mr Speaker, as I had said in my Budget Address to this august House, the main thrust in this Bill is to amend Section 9 of the Mines and Minerals Act in order to ensure that any future development agreements shall not be contracted outside the law, as currently is the situation. Further, the proposed amendment is made to ensure that any agreements are entered into between the Republics, which would include all instruments in Zambia.

We also intend to increase mineral royalty tax from 0.6 per cent to 3 per cent of the gross value of the minerals.

Sir, the objective of the Government is to have a fiscal regime that ensures that a reasonable share of the mineral revenues accrue to the Zambian people by way of individual incomes and revenues to the Treasury. At the same time, it is the Government’s desire to ensure that the developed fiscal regime remains attractive to those who want to invest in this very important sector.

Mr Speaker, once these amendments are passed, we will have set the base on which the renegotiations for the existing agreements will be undertaken.

Mr Speaker, going by the active debate of yesterday when we were considering the Income Tax (amendment) Bill, we did, indeed, sway into the issues of mining. I hope that there will be less debate because yesterday, we did a lot of justice to understanding how we are trying to reform our mining regime.

Mr Speaker, I thank you.

Mr Beene (Itezhi-tezhi): Mr Speaker, I would like to thank you for giving me this opportunity to apprise the House on the findings of your Committee with regard to the Mines and Minerals (amendment) Bill.

Mr Speaker, during their deliberations, your Committee on Estimates considered the Bill in detail. In so doing, they interacted with various interested parties in order to acquaint themselves with the views prevailing among them with regard to the proposed amendments in the Bill.

Before I highlight the specific issues raised by stakeholders who appeared before your Committee in this regard, let me give the House some important general observations made by your Committee.

Mr Speaker, it is not a secret that the future treatment of the mining sector with respect to its law in the fiscal system and the country’s overall development strategy is a burning issue in the nation. Questions are being asked regarding the manner in which mining taxation was handled at the time the mining development agreements were negotiated. Questions are being asked regarding why the mining industry has not had an impact on the availability of the resources for capital formation in the public sector despite high copper prices. The Fifth National Development Plan (FNDP) envisages total public expenditure of K62,623 billion to be financed by the K48,443 billion or 77 per cent of the total expenditure from the Government resources and K11,198 billion from the donor community. This will leave a financing gap of K2,982 billion.

Mr Speaker, your Committee noted that the financing gap in the FNDP is evidence that the financial resources needed for the required growth are not assured, despite record copper prices and staggering profits in the mining industry. There has, thus, been a clarion call for the tax regime in the mining sector to be reformed. The Government seems to have hesitated to address this issue comprehensively. Meanwhile, the country has lost a golden opportunity offered by record high copper prices. This opportunity will not last forever. Copper prices are notoriously difficult to forecast with any accuracy.

Mr Speaker, however, with the presentation of this Bill and proposals to amend the Income Tax act with the object of rising the corporate tax rate on mining from 25 per cent to 30 per cent to increase the Mineral Royalty from 0.6 per cent t0 3 per cent of gross value and to re-introduce the standard rate of 15 per cent withholding payments to affiliates or subcontractors in the mining sector, there now appears to be a glimmer of hope that at last, the Government has begun to pay attention to the need to bring the mining industry in line with the rest of the corporate sector. This hope is further fuelled by the expressed intention of the Government to renegotiate the mining development agreements with the existing mining companies.

Mr Speaker, it has been argued that no tax holidays were granted and that instead, the mining companies were allowed to write-off accumulated loses against tax liabilities over a long period of time. As long as they carry over losses and no reasonable time limit, this was an ingenious way of constructing tax holidays.

Mr Speaker, there could never have been any credible reasons for believing that granting concessions will be so unfair to the nation, save the purpose of development and more efficient resource management over time. These concessions will tend to encourage more rapid and wasteful exploitation of Zambia’s mineral wealth given the high copper prices prevailing in the international markets.

Mr Speaker, it is obvious that Zambia’s negotiators were not aware of or did not consider alternative incentives or combinations of these, which would have been attractive without depriving the country of its ability to raise development resources from mining through taxation.

Mr Speaker, it will be critically important that a serious competent professional team of Zambian negotiators be constituted to renegotiate the terms of the mining development agreements. This country has people with talents to carry out this task without imposing foreigners on them. Their work should be transparent, but not at the expense of efficiency. Finally, that team should be free from political interference.

Mr Speaker, as they renegotiate the terms of these development agreements, the Zambian negotiators will be advised to bear in mind the major objectives of the investors. Usually, these are to maximise gross cash flow; to maximise the expected internal rate of return to equity over the life of the mines or of the development agreements (the contract with the Zambian Government); to assure complete freedom from management, production, marketing and financial operations; and to safeguard against changes in the conditions set forth in the contract or in the laws relating to the mining companies, activities at the time the contracts were signed. It is for this reason that at that time, they insisted on the development agreements being with the Republic of Zambia and not the Government and that the development agreements would override any other laws in Zambia.

Sir, there can be no denying that foreign capital has played an important role in the development of mining in Zambia. The agreements were not for the development of green-field operations. The agreements were for the acquisition of existing mines which initially required recapitalisation. The incentives were, therefore, unfair.

There are alternative incentives which could be given without impairing the ability of the Government to raise revenue through Corporate Income Tax. Some of these alternative incentives are outlined in your Committee’s report.

Mr Speaker, as regards the Bill, two opposing views were expressed by stakeholders.

Those against the proposed amendment stated that the cardinal point of the development agreements was to offer stability to the mining sectors. If this amendment was passed, mining companies would lose this stability and the investors’ confidence to invest in Zambia would be greatly reduced. The understanding was that the inclusion of fiscal terms in the development agreements had been for the purpose of offering fiscal stability that was necessary for investment. If this amendment was passed, the stability would also be lost.

Sir, the real impact of this proposed measure of clarifying the provisions of Section 97 so that the relief from customs and exercise duties which applied to holders of mining rights would not extend to contractors and sub-contractors was not clear. However, it was expected that the measure would have an impact on the cost of mining as the contractors would pass on this tax to the mining companies.

As regards, the proposal to increase the mineral royalty on base metals from 0.6 per cent gross value to 3 per cent of gross value, it was argued that mining companies had signed development agreements which allowed for stability periods in recognition that mining was a long-term business. The proposed amendment was contrary to the spirit under which the development agreements were negotiated and signed. Even if the amendment did not affect existing agreements, the legislation was likely to affect the flow of Foreign Direct Investment (FDI) as a result of a drop in international confidence in the country and would, therefore, work against the very people it was intended to protect. As Zambia was not the only country endowed with minerals resources, it was possible for investors to shift their investment to other countries where the Mining Law was good and predictable.

Sir, it was, further, anticipated that as soon as these carryover losses and capital allowances were liquidated, the mining companies would be in a tax-paying position and the mining companies’ contribution to the Government Treasury would be enhanced. This was particularly imminent in view of the high metal prices which had accelerated the liquidation of these allowances.

Mr Speaker, on the other hand, those in support of the proposed amendment argued that by introducing the Bill, the Government had responded to calls from the general public for the mining sector to contribute more to the Zambian economy. The Bill sought to amend the Mines and Minerals Act primarily because of the need to increase the contribution of the mining sector to the economic development of this country. The unprecedented increase in international metal prices had not translated into increased benefits for the nation, particularly in terms of Government revenue, because of the nature of the current fiscal regime for the mining sector. This regime was generally perceived, and rightly so, to be too generous in the current economic scenario.

Sir, in addition, one of the major problems with the development agreements was that mining companies wanted development agreements to apply to all public institutions in Zambia. Mining companies that had signed development agreements with the Government had tended to assume the inclusion, under the Stability Clause, institutions such as municipal councils, Workmen’s Compensation Fund, Zambia Electricity Supply Corporation (ZAESCO) and the Environmental Council of Zambia (ECZ), yet these institutions were autonomous from the Central Government and were not signatories to the development agreements. The mining companies used Section 9 of the Act to justify their claim, because this section stated that the development agreements were entered into on behalf of the Republic and the word ‘Republic’ covered all public institutions in Zambia. To solve this problem, it was being proposed that Section 9 be amended to read ‘Government’ and not ‘the Republic’. In this way, it would be clear to all parties to future development agreements that the development agreements would strictly apply to the mining company and the Government.

Mr Speaker, your Committee were informed that another problem was that development agreements were above the law. This situation was unacceptable. The Mines and Minerals Act should be amended to make all the provisions in development agreements subservient to the laws of Zambia.

Accordingly, the development agreements should no longer be above the fiscal laws of the country. It should not override any provisions of the Income Tax Act, for example, but could only make a cross reference to such laws when necessary.

Sir, there was also concern, on the environmental impact of mining activities. It was noted that there were duplications of functions and mandates that related to the environmental protection and conservation between the Ministry of Mines and Minerals Development and the Environmental Council of Zambia. Particularly, Part IX duplicated the requirements under the Environmental Protection and Pollution Control Act (EPPCA). The Mines and Minerals Act should cross-reference the EPPCA to ensure that before a mining right or mineral processing licence was issued, the developer or licensee undertook an environmental study in accordance with the provisions of the EPPCA.

Other provisions in the Bill did not raise much controversy and I seek the indulgence of the august House to be allowed to simply encourage hon. Members to pursue your Committee’s report on those particular issues.

Mr Speaker, in recognition of the prevailing economic conditions in the country, and the fact that the National Budget has such a large deficit, your Committee feels that there is no justification at all for the continuing of the generous incentives that the mining industry currently enjoys. They also agree and emphasise that there is need for all agreements entered into by the Zambian Government to be subservient to the law. Your Committee, therefore, fully endorse the proposed amendment to the Mines and Minerals Act, as contained in the Bill, with regard to the review of the incentives availed to the mining companies, particularly under the development agreements.

Further, your Committee urge the Government to consider initiating legislation to provide for the sharing of the Mineral Royalties Tax with local communities hosting the mining operations through traditional leadership and the local authorities.

Mr Speaker, your Committee fully support the efforts by the Government to renegotiate some of the provisions of the existing development agreements in light of the prevailing circumstances in relation to the metal prices on the international market as compared to those at the time of entering into the agreements. Zambia needs a sense or urgency in its development strategy. Zambia has resources to develop. The Government must not lose sight of the fact that the major benefits to this country from foreign investment in the extractive industries arise from the Government’s tax revenue rather than from payments to labour and for the goods and services, most of which, are in any case, purchased from abroad. This country now has a window of opportunity which may disappear unless we grasp it. If we miss this opportunity, Zambia will forever remain the poor enclave economy that it is today, dominated by a substantially foreign-owned mining industry.

In the light of the foregoing, your Committee strongly recommend that, in the interest of transparency, the Government provides this august House with regular progress reports on negotiations and problems being encountered therewith if any.

Mr Speaker, your Committee also wishes to strongly support the view that environmental issues need to be comprehensively dealt with under the Mines and Minerals Act by cross referencing the Environmental Protection and Pollution Control Act.

Finally, Mr Speaker, Sir, I wish to express your Committee’s gratitude to you for your guidance throughout its deliberations and also thank all my colleagues serving on your Committee for their commitment and dedication to the Committee’s work.

I also wish to thank the Office of the Clerk of the National Assembly for their unfailing assistance and services to your Committee throughout the deliberations.

Lastly, I wish to note and convey your Committee’s appreciation to the role played by the consultant to the National Assembly in assisting with the analysis of the 2007 Budget and the consideration of the Bills.

I thank you, Mr Speaker.

Mr Milupi (Luena): Mr Speaker, I think this is an appropriate time to air our views on the number of issues raised by this proposed Mines and Minerals (Amendment) Bill 2007.

Maters of natural resources of any nation and matters of sovereignty are very emotional. They have to be because it is on the basis of national resources that nations can exist. Have we not witnessed what is happening to our south on matters of land? Have we not witnessed what is happening in Nigeria on matters of oil? With this respect, a premier resource of Zambia is none other than copper. It is copper that the Almighty God gave to us and it is on the basis of this that we need to establish the development of this nation.

All of us recognise that at the time of privatisation, Zambia might as well have been in dire straights. There was pressure on this country to privatise the existing mining companies. And this is the danger of over relying on outsiders to run the affairs of this nation.

The World Bank and the International Monetary Fund (IMF) had an upper hand in determining the conditions under which we privatised. So many arguments were used to force this nation to privatise. We have heard even in this house, issues of one US$1 million a day that was being pumped into the mine. Yesterday, no one could have put it better than Hon. Lubinda did when he said so far, there has been no empirical evidence to show that indeed, US$1 million was being pumped into the mines.

How could it be? Where was Zambia as a nation without the mining industry pumping US$1 million a day into the mining industry? How could that be when the mining industry of that time had taken on responsibilities that were the preserve of the Government? Was not the mining industry running schools, hospitals, repairing roads on the Copperbelt and even running some private companies? All these were the responsibilities of the Government, but the mining industry of that time took on these responsibilities.

Hon. Members: Hear, hear!

Mr Milupi: How can any one now say that at that time this country, poor as it was, was able to find US$1 million to pump into the mining industry?  Let us look at the privatisation process so that we can help the Government strengthen their position even as they negotiate. First of all, the privatisation process started in the late 90s right up to the early 2000s.

 All the mining units were valued at certain values and the valuation process took into account what was happening elsewhere. I will give you an example, Mr Speaker, Chambeshi Mine at the time it was undergoing maintenance was valued at approximately US$62 million. This was based on a similar mine operation in South America, in Peru, to be specific. Alas, when it was eventually sold, it was sold for much less than that.

The point that we need to make at this moment is that all of our mines were sold very, very cheaply.

Hon. Members: Hear, hear!{mospagebreak}

Mr Milupi: In addition to that, one of the conditions that were set in privatising this mine was that all the debt that ZCCM had accumulated over the years was going to be apportioned to all those units and the new mining owners would inherit that debt. Alas, that did not happen. The new owners refused to inherit that debt and this left a portion of it with ZCCM and the other portion with the Government.

In addition, Mr Speaker, environmental liabilities were also supposed to be taken over by the new mining owners. Again, because of their debt negotiation skills they refused to assume these environmental liabilities.

Mr Speaker, these agreements were concluded under circumstances where the copper price was very low. It was in the area of 75 cents per Pound. Before we stand anywhere in this nation and say that Zambia, at the time, had no choice, but privatise the mines, let us recall the facts.

Hon. Members: Hear, hear!

Mr Milupi: When the mines were under the ownership of our Government, not only were they forced to take on so much extra responsibilities, but even when the copper price rose above one dollar per pound which is equivalent to 2,240 Dollars per tonne, any price above that threshold was cut. There was no sharing and the Government took hundred per cent of it. The hon. Member for Mbabala who was Director of Finance will bear me witness on this particular issue. These were the conditions under which the mines were operating.

The new owners have come in and all this has been lifted, yet the price of copper rose to its highest price of 8,000 Dollars per Pound. It is right for this nation to expect that it has a share of that. Granted, there is equity participation in these mining companies. ZCCM holds shares on behalf of the Government in these mining companies.

Hon. Members: Hear, hear!

Mr Milupi: However, at this moment, there is no benefit arising from these shares. The few that declare profit, I see the hon. Minister of Finance and National Planning shaking his head. Let me state here that the few that make profit and declare dividend to ZCCM do not add value to the Government because the money goes to service the debt that they should have taken on in the first place, but did not. There is little revenue arising from ZCCM going to support the Budget.

Mr Speaker, we need to create incentives to help this country realise money from this natural resource which is copper. The existing mines are clever and negotiated, but as Hon. Dr Scott said yesterday, there is no morality in continuing to allow this nation, which is blessed with vast resources of copper that has such high prices not to realise the benefit of that natural resource.

Sir, yesterday, we heard that the investors will run away because the grade in Zambia is low. I think a figure of 2 per cent was being talked about as compared to 10 per cent in the Democratic Republic of Congo. Let those of us who know these things talk about them.

Hon. Opposition Members: Quality!

Mr Milupi: Sir, there are two types of copper ores in this country. There is sulphide ore which predominantly has been the ore that has been exploited from the early 1930s to date. In Zambia, we have the highest grade that has 4 per cent. This is taken from Konkola Mine. In Lumwana, it is 1 per cent below, but it is just that it is near the surface. They are going to exploit this open pit. The other type is the oxide ore from which we get grades up to 50 per cent in this country.

Mr Speaker, as the hon. Member has just said, it is on the basis of this that we can create acid. We need to appreciate these issues. We also need to understand that Zambia has the four best experts in the exploitation of copper. The investors that have come to this country are from Canada, India, Australia and other places. 

Sir, I can share the benefit of my travels throughout the world. I have been to Canada and I visited copper mines in Subgenera, the North Bay Area. Even in those days, they recognised that the expertise in copper mining was here in Zambia.

Hon. Opposition Members: Hear, hear!

Mr Milupi: Mr Speaker, I have visited India and I was able to see Hindustan Copper which is about a child’s picnic compared to the copper mine activities in Zambia. I have also visited Australia and when I was there, I was shown the Western Celebration Open Pit. They were so proud to take me there and said, that was the biggest pit they had. The surface area of that pit was 17 hectares. When I told them that the pit we had in Zambia was 2 km by 4 km, they were shocked.

Hon. Opposition Members: Hear, hear!

Mr Milupi: Sir, let no one belittle the expertise that Zambia has in the mining of copper and in the processing of copper ores. What we need is not only to go after the new mines that will come, but to appreciate that there are some copper ore resources in places such as Kasempa, Mufumbwe, Kaoma and other places that we know of.  It is opportune to add at this time that none of these new companies that have come has gone and discovered new ore sources. The ore sources they are exploiting including Lumwana, Kansanshi and Mulyashi are sources that we already knew about.

Hon. Opposition Members: Hear, hear!

Mr Milupi: Sir, it is just that the conditions may not have been right for this country to exploit them. Therefore, let us not denigrate our expertise in the exploitation of our premier resource. Let me suggest that we take advantage of this amendment Bill to say that the direction which we should go is not only focus on the new mining companies that will come in the years after, but also vigorously pursue the existing mining companies.

Hon. Opposition Members: Hear, hear!

Mr Milupi: Mr Speaker, in terms of the mineral royalty tax, the 3 per cent that is proposed, as I have said earlier on the Floor of this House is welcome, but it is below the world average of 5 per cent. Not only that, in the previous years, when we had Anglo-American plc. and RST in this country, the mineral royalty tax was in the order of 5 per cent. Therefore, why are we targeting 3 per cent?

Sir, in terms of the company tax, again the existing mines must be pursued so that they too contribute to the economy of this country by paying 30 per cent, not in some future date which may give them power to delay its implementation by engaging all the fancy lawyers that one can think of. Let this not become a legal issue because we are pressurised enough to accept development agreements which are above the laws of this land. Let this be a moral issue. Let us engage all the stakeholders to help us just as we are going to do in the matter of the voucher funds. Those investors should be made to recognise that if they have to continue making profits in this country, they must engage us. They must understand our position.

Mr Speaker, earlier, I said that the copper price is cyclical. It goes up and down and I explained on the Floor of this House the factors that make copper prices go up and down. Therefore, at some point, it will really go down. When we talked about the Stability Clause, we were saying that this country is supposed to stand back and allow certain things to happen. This was also supposed to apply to the investors, but that did not happen. This is because we saw that within a very short period of time, during master grip programmes, the Anglo American Corporation plc. pulled out. Was there any punitive action taken against them?

Hon. Opposition Members: No!

Mr Milupi: No, we sat back. We saw RAMCOZ pull out after it had taken so much money out. Earlier on, the Ministry of Finance and National Planning was making reference to the employee liabilities that this country had to take on from a private investor such as RAMCOZ. Those were not the only liabilities that they took on. There were other liabilities. The lesson from this is that in matters of investment from outsiders, when the conditions are not right for them, they will always pull out. When they pull out, it is this Government (both sides of the House), because we are all part and parcel of this Government, that will be left holding the can. When the copper price collapses, as it will surely do, some of these investors pull out, it is this Government that will be asked again to take over its responsibilities. With that, are we going take on these responsibilities if we are allowing all of this money to go out? These are the matters on which we should reflect very seriously because we are at a time when we should make a difference. The fact that mistakes were made in the past does not mean that we have to continue with those mistakes. It is time to correct those mistakes.

Mr Speaker, finally, let me say it is time now that this Government encourages the setting up of secondary industries to take advantage of our premier resource, which is copper. Why can we not have up to 50 per cent of the copper produced in this country processed at least to some finished products such as plates, rods, tables and so on. What is difficult about that? We need the Government to be interested in this idea and also to realise that through the development of downstream industries, there will be more employment creation, greater contribution to GDP and then wealth creation. We need to take advantage of our premier resource.

I thank you, Sir.

Hon. Opposition members: Hear, hear!

Mr Hachipuka (Mbabala): Mr Speaker, I would like to thank you for affording me this opportunity to debate this particular Bill.

Mr Speaker, as you know, usually, in my debate, I do not repeat what others have said. I do this because I would like to give value to my debate and integrity to the House.

Mr Speaker, Zambians have paid heavily for the privatisation of their assets over the last few years. If you recall, when the privatisation was being conducted, and I know that it is continuing, most of Zambia’s debt particularly on the mines, was undertaken by the Government. Now, we find ourselves in a situation where we are not in a position to benefit from the benefits accruing from the privatised mines. That is double payment and it worries me.

Mr Speaker, the first point I would like to make other than that is that in 2000, somewhere around March, I was a new Member of Parliament in this House, I am aware that at that time, some legislation was rushed through this House on which basis the privatisation of the mines was going to depend on. I am also aware that at that time, there were investors sitting at Mulungushi with the negotiating teams of this country. They were sitting waiting for this House to legislate the law that was above the Constitution, which is the basic law.

Mr Speaker, what worries me is that the arrangement that we have in this country where the third arm of Government, which is the Legislature, is heavily infiltrated by the Executive. When you have the Legislature which is heavily infiltrated by the Executive, the Executive can come in here and push a law that is above the Constitution. Who is supposed to protect the Constitution, if I may ask? How is it possible that we sat here in 2000 and allowed the then Government to rush some legislation in this House, which allowed this Government to enter into an agreement or agreements that were above the law? That worries me. We need to reexamine that to prevent such a thing from recurring. I now feel very sorry for this sitting Government. When I say the sitting Government, in this context, I am referring to this Executive.

Mr Hachipuka pointed at the Government Bench.

Sir, part of the legislation, which they have brought in here, is proposing to amend the royalties percentage from 0.6 to 3 per cent then, at the end of it, exempt those under the existing development agreements. It is because they are lame ducks. Practically, they are lame ducks and there is nothing they can do because they found themselves in a position where we legislated, gave power to the then Executive to actually enter into something that was ultra vires the Constitution.

Later on, this Government went ahead and felt that even if they had so many pieces of legislation around their nose, these pieces of legislation somehow permitted them to set up a Task Force. Many people have said that they should bring legislation to regularise the Task Force, but they have said that there is sufficient legislation to support the operations of the Task Force.

Mr Speaker, what worries me is that, we all know that the country has found itself in a very difficult position regarding the development agreements. This Executive is able to push the Task Force to investigate individual abuses of office.

Sir, I always ask myself whether it is possible that the legislation that we passed here which the Executive pushed on us with these development agreements, clauses and exemptions that we provided to the other people does not fall under the same?

Hon. Opposition Members: Hear, hear!

Mr Hachipuka: Why is it that they cannot investigate this matter?

Mr Mwiimbu: Hear, hear!

Mr Hachipuka: Why is it that they cannot focus and ask the Task Force to look into how we find ourselves in this very difficult position? They abused their authority by bringing a law a here which we enacted and found ourselves in a position where we are now beggars. This will not go away. The development agreements will go on for the next twenty years.

As my hon. Colleague pointed out, and I am glad that I am able to debate after such an expert - I worked with him in the mining industry for a long time. These are some of the excellent brains this country has ever produced. Why is it possible that we can legislate a law under this Government and keep on praising President Mwanawasa? Sometimes, I do. Why do you people in the Executive not advise him to send the Task Force to look into what really got Zambia into this mess?

Mr Mwiimbu: Hear, hear!

Mr Hachipuka: You are skating around the issue.  I would like to say that if there is any impropriety that caused the Zambian Government to go the way they went, even in international law through international courts, we can get some relief.

Sir, it is not possible and I do not want to believe for a minute especially, when I look at some of the development agreements and the general clauses that make it impossible for this Government to articulate the core issues.

Sir, at the moment, if you look at the Budget, you will find that the basic problem this Government has is that the tax they are collecting is substantially from individuals. The companies that they privatised are not even giving a third of the K7 trillion. O this K10 trillion Budget, K3 trillion is donor provided, but K7 trillion is raised from the nation and the bulk of that is coming from Pay-As-You-Earn. In short, the bulk part of that is from citizens. Therefore, our investment has not yielded anything and yet they keep on promising that it will in due course. While I appreciate that it will, how can it when many countries are supposed to be run on the numbers the other way round? Individual taxes should be lower than corporate tax and taxes from organisations because those are your major investments.

In this particular case, we did it wrongly. We wanted to privatise, rushed the privatisation process and have found ourselves in a very awkward position where we legislated and gave the development agreements which make it impossible for any Government to raise decent taxes and repair the roads in my constituency.

Mr Speaker, I am a victim of the legislation that was made by this Government in its previous terms. In general, you would find inadequacy in this Budget because we do not have funds. We have remained beggars and we depend on donors.

Mr Speaker, the point I am making is that the Government should ask the Task Force to conduct some forensic investigations on how we have found ourselves in the present situation. Can it go away? I have no quarrel with investors, who genuinely come here to invest, and the people who were party to the signing of the development agreements. The reason is that I have no evidence to suggest otherwise, but my common sense, which is my sixth sense, tells me that there must be some impropriety in the agreements. There is no way we could have legislated a Bill that has clauses which outlive any of us here.

What about in 20 years time, what are we going to be? How many of you will be in this House or even in your own houses? What will happen to our children? We cannot educate our children or put medicines in the hospitals. Copper prices are rising from US$1,000 to US$8,000 per tonne as it has been. Are you telling me that no one had the foresight at the time of negotiations to see this? In the copper industry, my colleagues will tell you, we predict copper prices in excess of 20 years. Is it possible that no one knew that the copper prices would go up, where the economy was going or that the Chinese had an economic boom on their door steps?

Mr Speaker, no one can convince me that this was not designed to be where we are at the moment. I have spoken about this to the hon. Minister of Finance and national Planning and the Minister of Legal Affairs. They are all aware of the difficulty we find ourselves in. We cannot continue to always look to God. He has given us the minerals and everything there is to give to any nation. The issue is management.

You have decided to sell the mines and are living on peanuts. People are siphoning the copper and selling it. To make it worse, that money is not even banked here. Therefore, nobody can borrow it. That is why we find ourselves in this very difficult position.

Mr Speaker, I beg the Government to seriously re-examine the development agreements. I am not saying that they should simply re-negotiate them, but look at any possible impropriety because at the end of the day, we are stuck. Whether you like it or not, this country is stuck. You cannot be at the mercy of the whole world, living on donations. We cannot go on like this.

I thank you, Sir.

Mr Speaker: The rules of the House do not allow tedious repetitions. Yesterday, I asked whether there was anyone who had a new point on the debate. The answer was, yes. The hon. Member was given the Floor, but it was not a new point. This shows that there is repetition in the House. Is there any Member of the House who has something new to say on this Bill other than talk about development agreements?

Dr Machungwa (Luapula): Most obliged, Mr Speaker. These Bills we are considering are important for the people of Zambia. In beginning my debate, I wish to commend members of the Committee for the work they have done. In some respects, I wish to take a different position. Let me begin by quoting from the report. On page 2 of the report, where they talk about the Budget and burden distribution of Zambia tax structure, the paragraph under there says: 

‘It is widely accepted that the equity of burden distribution of the existing tax structure is heavily weighted against the individual tax payer, whether in employment or not. In this year’s Budget personal income tax collections will account for 27 per cent of the total tax revenue or 26 per cent of total domestic revenue. In contrast, revenue from the corporate sector, through company tax, will constitute only 12 per cent of total tax revenue or 11 per cent of total domestic revenue. And the mining sector will contribute an insignificant 0.99 per cent of the total tax revenue or a paltry amount of less than 1 per cent of total domestic revenue.’

That is where the problem is. When the hon. Minister of Finance and National Planning announced that he was going to re-negotiate agreements and that the tax structure was going to be re-arranged so that those who have more money can contribute more towards the development of the country, all Zambians were overjoyed and greatly encouraged. The Government was praised for taking this important step.

Sir, the principle of tax in any democratic country is that those who earn more money, pay more towards the running of the Government and provision of services. Those who do not earn anything, cannot pay. When you talk about the mineral royalty taxes and other taxes, we have a situation, as stated by the Committee, where we are taxing more from those who have less and allowing those who make more, to get away with it without doing anything.

Like I said, the people of Zambia were extremely pleased when the hon. Minister of Finance and National Planning said that we are now re-structuring the tax system. Let me use an analogy here. If a breadwinner in a family is unfortunately struck by a stroke and some of his legs and arms are paralysed and therefore, cannot contribute effectively to the family, that person will be looked after by the wife and the children. They will struggle to try and support him because he is not capable of contributing effectively. If, by a miracle, that person should fully recover, and even get more vigorous than before, it is not reasonable to say because that person had suffered a stroke, he must continue to be fed and cannot contribute. It does not make sense. What we expect is that that person will now begin contributing.

It is true that we have these so-called agreements that were signed. I think the hon. Minister and many others who have debated have said that these were done at gunpoint or under duress. I am not lawyer, but the learned Hon. Minister of Justice and other legal experts will attest that if evidence is obtained under duress, it can be refuted in a court of law.

Mr Tetamashimba: On a point of order, Sir.

Mr Speaker: A point of order is raised.

Mr Tetamashimba: Mr Speaker, there is no doubt that the hon. Member of Parliament for a constituency called Luapula which also represents Luapula Province is actually repeating himself. Is he in order not to try and defend himself from the insinuations which were raised by Members of Parliament for Mbabala and Luena, who argued that we were missing US$1 million everyday, a claim that was supported by Hon. Hachipuka who went further to ask this Government to refer this matter to the Task Force for investigation? Is he in order not to try and explain what transpired since he was in that Government which brought that law to this House? I need your serious ruling, Sir.

Hon. Government Members: Hear, hear!

Mr Speaker: My serious ruling to the point of order which has been raised by the Hon. Minister of Works and Supply is that no hon. Member who is not part of the Executive is bound to answer on behalf of the Government, irrespective of the history that is being referred to.

However, I have to caution the hon. Member for Luapula that he is in fact repeating what other hon. Members have already said in this House and that was contrary to what the Chair understood he would do. The hon. Member must move away from initial agreements and go back to his undertaking if he has new points to bring up.

He may continue if he has a new point to bring up, if not, we make progress?

Laughter

Dr Machungwa: Mr Speaker, I will try to follow your guidance.

Sir, all I want to say is that, if there is a drought in this country and we know that the drought will persist, we need to conserve water. We are going to come up with a vessel or a big boat or some kind of contraption that will help store this water for our use and our children. We shall all be excited for doing that. However, if we come up with a basket to use in storing that water, then we are not going to achieve anything.

Sir, what I am saying is that we have come up with a good intention in the Act, but then, there is a proviso in this Act which allows the water we are trying to tap to get through. Basically, what we are saying is that the proviso under Article 17 of the Bill that we are looking at now introduces holes in the vessels or bucket that we are using to trying to reserve water for the people of Zambia.

Hon. Minister, if anything, we are strengthening you so that you can even do better. We realise that we have a problem in the country. When we say that we must come up with a basket that is going to hold the water then we must move together. Therefore, the legislation that we make must be such that it improves on legislation that we had before and not continue with the same mistakes that we made.

If we say that a piece of legislation is defective or it allowed too much to the other parties, what we are now saying is that, if we are going to make an amendment, let us make and amendment …

Mr Speaker: Order!

Business was suspended from 1045 hours until 1100 hours.

Mr Speaker: Before I suspended business, the hon. Member for Luapula was contributing to the debate on the Second Reading stage of the Mines and Minerals (Amendment) Bill, National Assembly No. 7, 2007 and he may continue bearing in mind my guidance which still stands.

Dr Machungwa: Mr Speaker, I am much obliged.

When business was suspended, I was just stressing the issue of trying to draw water using a vessel that is leaking and therefore, cannot draw any water. And so, I would like to encourage the hon. Minister and the Government that this is what the whole House is saying. Even though others on the other side might not debate, basically what we are saying is that we must cut something for the Zambian people. Therefore, Hon. Minister, the vessel that you are using must be water tight and this is what we are trying to do.

Let me come to the issue of mine safety. Sir, we have witnessed some accidents in the recent past. The BGRIMM Explosive accident in Chambeshi is one example and there are other accidents. The Government department that is charged with the responsibility of ensuring safety is funded by taxpayers. Now, what is happening to strengthen that department, the hon. Minister of Finance and National Planning must collect resources from the people whether it is marketers or whoever so that safety of workers employed by a private company must be assured. One would like to believe, hon. Minister, that ensuing safety is part of the cost of operating a mine so that it makes sense for the mining companies to pay for the safety just like they pay for other supplies and requirements.

 In fact, we have good examples. There is a company called Anvil which transports copper through Mweru to Nchelenge. They transport it on our roads all the way to Namibia. Now, in the process, they damage our roads. There is an agreement as part of the cost, to contribute towards repairing these roads. They do. If the operators of these companies in their operations are going to endanger the safety, health and lives of the people, surely they should make some provision for that. Why can the hon. Minister not ask them to contribute something like US$10 per tonne that can go towards safety? Instead of asking somebody from Kalingalinga to contribute to the ensuring safety at a private company which that company should contribute as a cost?

In the area of environment, the Environmental Council of Zambia (ECZ) charges a levy to companies to ensure environmental safety. Why can we not do that for safety of our employees? Why should we be paying for that? Why should we not take the little money that can go to educate the children in my constituency for safety in private companies that are making huge profits?

Regarding the mineral royalty tax, it will be necessary that some provision is made out of that tax to go to the local authorities or to try to improve the lives of our communities. The hon. Minister, in his statement, had said this fund will be collected and that the royalties will be put in a fund and will be disbursed according to, I do not know what criteria.

Mr Speaker, I do not really think that the communities where these mines are getting the wealth from and where we are getting the royalty tax from, if we get it, are going to get something commensurate to what is coming from those areas. It would be necessary, Sir, that when we look at this, you ensure that there is some money that goes to those communities to ensure that they also benefit. This is why like one of the colleagues who debated earlier, and I believe it is the hon. Member for Luena (Mr Milupi) was talking about development in places such as Nigeria in the Delta, the people have taken the law into their own hands. We do not want a situation like this to come and so it is important for us to consider this.

Mr Speaker, as I conclude, what I wish to emphasise is that we have a responsibility in this Parliament and Government in particular has a responsibility to listen to what the people of Zambia are saying to try to ensure that the country begins to improve. The GDP figures are impressive and we say the GDP has increased, but there is a drastic difference with the GNP which is Gross National Product which is the money that goes to the people or the citizens in the country because the money that is being reflected in the GDP is being taken away. What we are saying is that we should have a basket that will hold some of that money to stay here.

Mr Speaker, in twenty years time when these agreements will expire and I believe quite a number of people in this House will not even be here, what is going to remain? What we are saying is that it is not that we are not supporting Government, to the contrary. By talking the way we are talking, we are supporting you, let them hear it loud and clear that this House and the people of Zambia are not happy with the status quo and something has to be done. It is, for lack of a better word, political chicanery …

Mr Speaker: Order! The word is unparliamentary.{mospagebreak}

Dr Machungwa: I will use the phrase political deception to say that we are doing this for you, but when we get there to do it, we allow the animal we went to catch for the people to slip through our fingers and we allow it legally. I know the hon. Minister of Legal Affairs has talked about going to court and being taken to court. We cannot defend or be spokespersons for those people. We are spokespersons for the people of Zambia. If the Government is coming here to be a spokesperson for the mining companies, then who sent them here? Anybody has a right to litigate. This is the language we hear in this House when we talk about ZOT, the Zambezi Oil Trading in Ndola. Some hon. Minister came in this House and told us that even though they have violated five Acts of this country, they should go ahead because, we do not want to be sued and taken to court …

Mr Kunda: On a point of order, Sir.

Mr Speaker: A point of order is raised.

Mr Kunda: Is the hon. Member debating in order to suggest that I was giving legal opinion to outsiders who entered into an agreement with the Government, when I was giving my legal opinion to this august House and that is my constitutional responsibility? Is he in order to suggest that?

Mr Speaker: The hon. Minister of Justice and not Legal Affairs has raised a point of order that clarifies for the hon. Member for Luapula for whom and to whom he was giving that legal advice. Will the hon. Member continue, please.

Dr Machungwa: Mr Speaker, I appreciate the advice given by the hon. Minister of Justice. What we want in this House is that he should be positive rather than sound like he is a spokesperson for those people. This is the way we are reading it …

Interruptions

Mr Speaker: Order! The hon. Member is trying to argue with the decision of the Chair. Please, leave that point and continue.

Dr Machungwa: Mr Speaker, in conclusion, …

Hon. Members: Hear, hear!

Dr Machungwa: … what the people of Zambia are telling you our friends that have the privilege to lead Government is that when you go to talk to those people, we expect you to deliver. If you go with a defeatist attitude when you are going to war, they will just fire one bullet and you will run away. We want you to go there and tell them what the people want. We are not going to sit in this country for the next twenty years and wait and watch as all the wealth is filtered out of the country and we are sitting here saying this is a rich country and you give us all these GDP figures that are increasing when the poverty in the country is going up. That is the message. When we debate, we are only strengthening your hand, we are looking forward to an amendment to that particular proviso in that Bill and in the other Bill that will satisfy the people of Zambia so that we are able to store the water. Use a vessel that will store the water and do not let it get away so that we cannot drink it and our children cannot drink it.

I thank you, Mr Speaker.

Mr Magande: Mr Speaker, I thank you very much for giving me this opportunity to make some comments as I wind up debate on this very important Bill.

Mr Speaker, from the debate this morning, I am encouraged that hon. Members do support the efforts of the Government to make amendments to the current Mines and Minerals (Amendment) Bill as it exists. The support is as clearly as we have heard from the two hon. Members, the hon. Member for Luena (Mr Milupi) who is not in the House and the hon. Member for Mbabala (Mr Hachipuka) who is also not in the House.

Mr Speaker, indeed, we have experts in this House on mines, just as I am conscious that we have experts in economics, we also have experts in engineering. The purpose of coming to this House is to pass legislation that is supposed to be implemented by those who are practicing. I wish the hon. Member for Luena was here, I would have advised him that he may be spending his next five years in a wrong area and that he should go back and work for one of the mines because that is where he is technically qualified.

Having said that, Mr Speaker, I would like to say that this Bill is trying to correct what was done in the past and like most hon. Members who are here have attested, there was an Act of Parliament and there was a decision of this House that allowed development agreements to be above the law. I heard the hon. Member for Luena saying we should not succumb to pressure even if it is brought on this country. In fact, it would seem, during that debate, there was a lot of emphasis on the country. That is how the legislation ended up saying these agreements are going to be binding on the Republic. However, I do not know what learned Member for Monze would define as a Republic. Again, because the sentiments which were being expressed and were not directed at specific things, the debate ended up raising so many issues that were not required.

Mr Speaker, yes, the hon. Member for Luena said we have experts, but I would like to comment on what hon. Member for Mbabala said. In spite of having these experts, in 2000, they failed us greatly. They were unable to predict the price of copper of $3 per pound. That is why those who had decisions to make like the Executive and Legislature were misled because the experts were not able to predict these prices. Let us, therefore, not go back to the same path and make the same mistakes. By rushing, you will think that, like Hon. Dr Machungwa, we are introducing a boat instead of a basket to carry water and we discover the boat has a hole immediately under the weight of the water, will break down and the water will spill on the white sand of the Samfya Beach. That is not what we should do. We are cautious that we must move cautiously on this matter. Like most of us know, mining is not only on the old Copperbelt, but the rest of Zambia is providing opportunity and we can see the potential that is being realised there.

Indeed, I would like to say I am very proud, Mr Speaker, that although these foreigners are coming, most of what they doing is bring only their money. They will also be buying equipment which we do not make, but the managers of these mines are local mining experts. I know the General Manager for Nkana Division is a mining expert from Mazabuka. He was trained here and he is the one running that mine. Somehow, the Albion Mine in Mazabuka which is being opened by foreigners using sophisticated equipment is being run by a Zambian from Kasama. He was trained here and he is one of our experts.

At Kansanshi, Mr Speaker, those who have been there will know that the controls for that mine are actually under the supervision of a very competent young lady who was trained at the Copperbelt University. When you go there, she will tell you, ‘I can shut the mine from here and paralyse everything’. So, we do have experts. That is why we are saying we should embrace the people that have money to come and invest in this country so that our Zambian experts can get jobs. Those who might not know, the miner at Albion was working for Konkola Copper Mines (KCM). Before he left KCM, he constructed one of the best primary schools in this country out of the salary he was being paid. He is a world expert. That school is on the Copperbelt and it is providing services to Zambians. That is what we need. This is how we want the mining industry to have a multiplier effect on the rest of the economy. I am very pleased that most of my colleagues here understand what we are trying to do.

The hon. Member for Mbabala, Mr Speaker, talked about investigating those who signed these development agreements. I would like to inform him that, at the moment, we already have a Task Force looking into some of the issues that perhaps were suspicious of how they were done. As we have been discussing in this House, we believe there was adequate consultation and information at that time on the mining industry that, ZCCM was running the whole country into the ground. Money was getting out of the budget and going to ZCCM to maintain the equipment. Those who might have been to Luanshya will know that for a long time, until 2 years ago in fact, when the Luanshya mine was sold, the Government, I was already Minister of Finance and National Planning, was expending money from the budget to pump out millions of tonnes of water in order to prevent the mine from flooding. That was what was happening even before we started privatising.

I would have loved to say more if the hon. Member for Luena was around. He said ZCCM was doing what the Government was doing. Yes, we appreciate that, but perhaps that is how instead of re-investing and rehabilitating mining equipment, we started building lodges. Those lodges were not contributing to the rehabilitation of the equipment and that is what ran down our minds from a total production of 750,000 tonnes to 250,000 tonnes. At that level, the mines became unprofitable. So, what we should do now is look to, like Hon. Dr Machungwa says, what happened to this bread winner who had a stroke. He has come round now, instead of us still sending him to go and cut firewood, we should ask him to write on a small piece of paper telling his grandchildren where the firewood is found because he has no more energy to cut the firewood. If you are going to give him the same burden, he will end up getting a second stroke and die. He should now use another part of his capacity that is the brain work. We must not go back to what we did such as the putting up of football clubs by ZCCM. No, that is wrong. Football clubs now, like in most parts of the world, should be maintained by people who are earning money by supplying to the mines. Then, we know there will be permanency even when the mines are not there anymore. If we go through the same process, we are just re-inventing the wheel and time is not on our side.

Hon. Government Members: Hear, hear!

Mr Magande: Mr Speaker, I also heard the issue of why we are changing the parameters of the gross value as against the net profit. In the report of the Committee, there are saying one of our neighbouring countries is charging 7.5 of net profit as mineral royalty tax. Now, net profit is different from gross value. We are talking of 3 per cent of gross value. In other words, from the statistics collected by the Ministry Commerce, Trade and Industry which does imports and exports and from those collected by the Zambia Revenue Authority (ZRA) which also gives licences and gets information, we will know the value of the minerals that are exported. That is where you will get the 3 per cent, but if you go for net value, then it means, these operators are going to subtract their operations and they can overload the operation cost so that by the time you have your net value, it is so small that even if you increase the percentage to 100 per cent, you could end up getting nothing.

Hon. Government Members: Hear, hear!

Mr Magande: That, I thought is the difference of what we are doing. I think it is very important to understand these terminologies.

Mr Speaker, I wish, therefore, to thank all the hon. Members. Yesterday, when we started discussing this matter, we offered that the brains, this time I am sure there are legal brains, who would like to help us make adequate amendments to include in the development agreements now, but not to be against what we signed before over the  weekend. They should help us to frame the amendment thereto.

I would like to say to Hon. Dr Machungwa that even when he is not in the House, and is in his computerised chicken run, he should listen to Radio Parliament because he would have known we discussed these issues yesterday.

Laughter

Dr Machungwa: On a point of order, Sir.

Mr Speaker: A point of order is raised.

Dr Machungwa: Mr Speaker, is the hon. Minister of Finance and National Planning who is a winding up and has been speaking so nicely and considerately that he is inviting our experts here to help him in crafting the amendment in order now to make me part of his debate, and talk about chickens when we are talking about the Mines and Mineral Royalty Tax? Is he in order to talk about that, Sir?

Laughter

Mr Speaker: The hon. Member for Luapula prefers to be left out of the winding up debate by the hon. Minister of Finance and National Planning.

He may continue winding up, and leave the hon. Member for Luapula alone.

Mr Magande: Mr Speaker, I beseech that, as we come up with proposed amendments to this Act, we do not complicate it any further. Already, the amendment presented by Hon. Mwenya, talks about the definition including total minerals extracted.

The question is how can you determine the value of total minerals extracted and where do you verify that? With a pitch, 50 kilometers away from the smelter, who would know the value when it comes out of the shaft? Between the shaft and the smelter, if the vehicle has a problem, you lose 2 tonnes of the copper ore. The quantity of copper ore extracted is different from the quantity which goes in the smelter.

Consequently, where is the value of the minerals extracted? By the time we are getting the copper out of the smelter for export, you have thrown away so much soil. The value of that is completely different from the loads of copper ore which you come out of the shaft.  How, therefore, do we determine the value of minerals extracted?

Therefore, I think, that while we want to be as technical as possible, we should make it easier for the Executive to implement by leaving out complicated definitions.

I thank you, Sir.         

Question put and agreed to and the Bill read a second time.
   
  Committed to a committee of the whole House.

Committee on Wednesday, 28th March, 2007.

REPORT STAGE

The Markets and Bus Stations Bill, 2007

Report adopted.

Third Reading on Tuesday, 27th March, 2007.

______

COMMITTEE OF SUPPLY

[MADAM CHAIRPERSON OF THE COMMITTEES in the chair]

VOTE 65/01 – (Ministry of Science, Technology and Vocational Training 
                         K130, 858,901,651).

(Consideration resumed)

Mr Mabenga (Mulobezi): Thank you very much, Madam Chairperson. In the first instance, I would like to take this opportunity to congratulate hon. Dr Chituwo, for his appointment to the Ministry of Science, Technology and Vocational Training.

Hon. Members of Parliament: Hear, hear!

Mr Mabenga: I know that he is a conscientious worker. I know also that he works diligently and talks less. In addition, he has a very good team to work with at the ministry. Dr. Zambezi, the Permanent Secretary, is a very supportive man. Furthermore, I am sure that he is receiving support from the Director General, Dr Nkanza and all members of staff.

Madam Chairperson, the Ministry of Science, Technology and Vocational Training has a big role to play in the development of this country. Every country develops with the in put of science, technology and vocational training. Those of you who were in school before this ministry was put in place will remember that in the very early stages of the standards, in Sub A and Sub B, you were exposed to vocational training skills, learning to make mats, baskets, etc.

These are life saving skills that were imparted in the children. Currently, I know that stringent efforts are being made to ensure that those who have the talent in science exhibit them in various foras. In this case, it is the Junior Engineers Technician Science (JETS) clubs. I know that these clubs hold foras at provincial, national and international levels. However, I believe that publicity has not been enough for our young people to take active participation, even at the high school level.

I believe that most children are not given the education at that level, but only those who want to belong to a certain club. I would like to implore our teachers to ensure that they prepare those who have the skills in science, technology and vocational training so that as they leave high school level and go into tertiary education, they explore these skills even further.

Madam Chairperson, once our young ones go through this very noble and important stage of being exposed to science through the JETS fairs, I believe they will also have an opportunity to train and become scientist like the able men and women at the National Council for Scientific Research.

Madam, you will remember that in 2002, this country experienced famine. During that time, many people from outside this country said that they would supply us with food. In fact, at one point, one big power said that it would supply us food which had Genetically Modified Organisms (GMOs). Of course, the Government reacted sharply to that and His Excellency the President said that he would never allow GMO food to come into this country. You will also recall that some of the food that was brought into this country was tested by the National Council for Scientific Research to ensure that it had no GMOs in it. Our scientists were able to tell us whether that food had GMOs or not.

Madam, what it means, therefore, is that we have able men and women at that Science Research Station, who were able to tell us what the people in the developed countries had done. Because of this, I would like to implore the hon. Minister of Science, Technology and Vocational Training to ensure that the Science Research Station is fully supported. In fact, it is important to take hon. Members of this House there so that they see what exactly they do. In my view, this institution is very important in the development of science in our country. If we went and saw for ourselves what that institution is doing, we would come back to this House and support the efforts of the research station. If we have to get all institutions working, science would be pivotal in making them perform.

Madam Chairperson, at this point, I would like to turn to the Evelyn Hone College of Applied Arts and Commerce. That college is one of the important institutions as far as training of the young and older ones in as far as in-service training is concerned. I know that we have a number of serving teachers who at times go there for in-service training in different arts, such as music and so on. While that institution only goes up to Diploma Level, I would like to suggest that it be affiliated to the University of Zambia so that it begins to offer degrees in various levels of education attainments.

Hon. Government Members: Hear, hear!

Mr Mabenga: It is very important to move on. The hon. Minister told us that the Solwezi Trades Training Institute will now be offering diplomas. That is a step in the right direction. We would like to congratulate the hon. Minister and his ministry for elevating the status of that institute in Solwezi.

Madam Chairperson, the introduction and building of bio-sciences laboratory at Evelyn Hone College makes me even happier. The amount of money that has been allocated to this scheme, amounting to K2 billion, indicates the commitment of the Government, under the MMD Administration, in the betterment of education in this country.

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

Mr Mabenga: Madam, I would like to urge the ministry to see to it that the Mongu Trades Training Institute is allocated a total amount of K2 billion so that they continue building the infrastructure. Kaoma Trades Training Institute has been given K600 million. Various trades’ institutions in the country have also been allocated money.

However, I would like to say that these trades training institutions are not enough because all over the country, many of our children are dropouts. If these trades training institutes would be built in large numbers all over the country, our children would have an opportunity to get skills in various life saving endeavours.

Madam Chairperson, I had a private talk with the hon. Minister over my constituency and he was very positive in our discussion. However, I would like to emphasise that those good and well meaning people and countries who want to give us aid, should be allowed to do so. Let them come as many as they can and pour enough resources to supplement the efforts of this Government in ensuring that science, technology and vocational training is enhanced and that what we want to see done at the Mount Makulu Research stations continues to be done for the betterment of this country.

I thank you, Madam.

Dr Chishya (Pambashe): Madam Chairperson, I thank you for according me this opportunity to contribute to the debate on the Vote on the Floor. In support of the Vote, I would like to say that the role of science and technology in national development is unequivocal. This has been ably articulated by the hon. Minister in his Policy Statement. He mentioned the role of science and technology in agriculture, mining and manufacturing and furthermore its role in health and herbs.

In supporting the Vote, I would like to draw the attention of the House to Page 536 of the Yellow Book, Sub-head 3, Programme 3, Activity 03 — The National Institute for Scientific and Industrial Research (NISIR) — K8,550,00,00

Madam, this institution came into being under the Science and Technology Act of No. 26 of 1997 and put into operation through the Statutory Instrument No. 73 of 1998. Under the same Act, the National Technology Business Centre (NTBC) was established, but the main activity of the National Institute for Scientific and Industrial Research (NISIR) is to carry out demand-driven research and development (R&D) and the main activity of the NTBC is to promote and commercialise the activities of R&D. However, there is a big problem which concerns, in particular, the management and board. Three of the circulars from management have revealed that the management has leased some of the institutional property in terms of research, equipment and machinery, buildings for energy research and other property to a private company called Star Drilling and Exploration Services Limited, a Lebanese Company.

Under the memorandum of understanding entered into on 26th February, 2007, it mentions a lease for 30 years. In fact, no permission was sought from the hon. Minister of Science, Technology and Vocational Training when the memorandum of understanding was entered into, unless the hon. Ministers says otherwise.

The National Technology and Research Centre, with the effort to promote technology transfer as the Act stipulates was also ignored. In fact, in the Yellow Book, K1.3 trillion has been allocated to NTBC to carry out its functions of promoting and commercialising the activities of R&Ds. In this regard, I would like to request the hon. Minister at the appropriate time to make with a ministerial statement on this issue.

Madam Chairperson, on page 545, Sub-head 3, Programme 7, Activities 01 – Monitor Performance of MSTVT Science and Technology Institutions and 02 – Conduct Inspection of Science and Technology Institutions were allocated K134.4 million and K53 million respectively last year and K13.5 million and K73 million respectively this year. Now, if these activities were to monitor the performance and inspection of research institutions, one wonders what kind of inspections and monitoring were carried out when an activity such as leasing of research equipment and machinery was taking place. If at all, the hon. Minister knew something about it, can we know the position of the ministry in this regard?

Madam Chairperson, on page 549, Sub-head 6, Programme 7, Activity 03 – Rehabilitation of NISIR Laboratories – Headquarters, no allocation has been made this year, but there was K400 million last year which was released for some rehabilitation at the NISIR institution. In fact, if you visited this institution now, you would find that some rehabilitation works was carried out, but other things still need to be attended to. For example, the cold rooms, the pilot plant used for research, steam generators, radio-Isotope research laboratory, industrial minerals research laboratory and a few others still remain unattended to. Rehabilitation of laboratories must be a process which is continuous.

Let me now talk about equipment. I must commend the hon. Minister for having procured the specialised equipment which is now at the institution. There are about three types of equipment, namely, the modern atomic absorption spectrophotometer (AAS) which has got a graphite detector and allows even elements such as selenium to be detected. There is also a gas chromatography. This equipment has two detectors, the flame ionisation detector and the electron capture detector. There is another equipment, high liquid performance chromatography which has three detectors, the ultra-violet, infra-red and the fluorescent detectors. I am sure no one has this type of equipment in this region and probably in the whole of Africa. Maybe, the University of Cape Town has such type of equipment.

Now, the question is how are they going to look after this equipment? There is already a problem of storage. The people who have to look after this equipment do not have the necessary qualification. At present, the equipment needs people who have qualification of a PhD or professorial level, but we do not have those at that institution. The institution had had qualified personnel before. There were more than thirty-five people at the PhD level, more than forty at the Master’s level and over fifty at the first degree level. Now, all these personnel who were there at that time have been retired and there is now a skeleton of staff which is nothing to be proud of. Only two people have remained at the PhD level and the rest are just at the first degree level and without experience. You will find that this type of equipment is placed in one room which is against the usual practice.

At the same time, I would like the hon. Minister to also look at the payroll at this institution. I will not be surprised that the hon. Minister, if he visits the institution, will also find ghost workers are on the payroll, and this, if it is banned soonest, the better for the country. That research being carried out at present is not what we can really call in terms of research as R and D because of lack of personnel. However, I can advise the hon. Minister that Zambia has got fully qualified people all over the country such that the University of Zambia has absolved most of the Researchers who were retired although they are still researching. Even if they are retired, we can make use of them at the University of Zambia to carry out research.

The National Institute for Scientific Research also used this approach. It does not need the NISIR to train its people and take more than eight to ten years to train one person up to the PhD level.

As it is now, if institutions follow that approach of training its own cadre, it will take a long time to realise that ambition. We must make use of the already existing personnel in the universities and elsewhere. I think they are all at their disposal. We do not need to spend any extra money to pay in terms of science. The hon. Minister can only facilitate for them to take part in this R and D at this institution.

I thank you, Madam.

Mr Misapa (Mporokoso): Madam Speaker, I would like to add a voice to that of the others on the Motion on the Floor, the Ministry of Science, Technology and Vocational Training. I know that science and technology is quite a complex subject and I would like to emphasis on that part.

Madam Chair, my question is: Why should one start learning science? I know that this is a complex issue. During our days, just after independence, children used to start studying science at an early stage, that is, Form 1 now Grade 8. This is why today, I am very certain that we can boast that at the international level that we have produced the best doctors, engineers, science teachers and agriculturists. The reason is that we were being exposed to science when the brains were still fresh and tender and able to capture all the scientific concepts.

Hon. Members: Hear, hear!

Mr Misapa: Now, the question is: Are we doing the same today? Are the children all over the place given the same chance? Is the future generation being promised that we are going to continue having better scientists? There is a very big question mark on this matter. In basic schools, the learning pattern has changed. Our children start learning science when they enter Grade 10 due to lack of laboratories in these schools.

Hon. Members: Hear, hear! Good point.

Mr Misapa: We may not think of the impact that will be felt in future now because we feel that we are satisfied with the scientists and engineers that we have. In this regard, I would urge the hon. Minister of Science, Technology and Vocational Training to work hand-in-hand with the hon. Minister of Education to see to it that money is put aside for the construction of laboratories in basic schools to enable our children study science in Grade 8.

By the way, in advanced countries, science, at a lower level, is extended even to as low as Grade 1, but here, we have the opposite. Instead of extending it to Grade 1 or lower grades gradually, we have now cancelled it for all the lower grades. It is now being offered in Grade 10. As a result of this, those who want to study science at the university level fail to complete their degree programmes because they started doing science practicals at a very late stage and therefore, their science backgrounds are not solid.

Madam Chair, one of my friends here has covered part of the JETS fair. We know that in secondary and high schools, we have what we call a JETS fair.

Hon. Members: Hear, hear!

Mr Misapa: I would like to request the hon. Ministers of Science, Technology and Vocational Training as well as Education to look into this issue very critically. Schools are supposed to be encouraged to conduct some simple research because research that comes from young ones, if we do not know, is what is amplified by advanced countries and then they pretend as if they are the founders.

Therefore, how do we use this knowledge from the young ones? We should harmonise all the clubs in schools at a very early stage, for instance, Form 1 and make sure that we mould our children.

How do we mould them? By monitoring, planning well and making sure that whatever research is conducted by young people is analysed by a special group and utilised in order to develop our nation.

Madam Chair, for example, we have what we call the National JETS Fair every year that take place at the University of Zambia where many people come from different walks of life with the view of trying to see what is happening. Since we do not have regulatory rules, these people steal the knowledge by simply going to the young ones pretending that they are simple observers when in reality, they are tapping information by asking them how they went about doing their project.

By so doing, they are stealing their knowledge and taking it to the people outside the country free of charge. Therefore, I am emphasising that it would be better for us to make sure that we organise our JETS fair in a manner that no information can be lost to external countries.

Mr Sing’ombe: Then you are very selfish!

Mr Misapa: It is not being selfish, my brother.

Laughter

Mr Misapa: Knowledge is power and money. Most of the nations bring the knowledge outside when they see that they can make profit out of it. Therefore, we would like to make sure that we improve on the JETS fair by encouraging the young generation to come up with competitive knowledge.

Madam Chair, I thank you.

Hon. Members: Hear, hear!

Major Chibamba (Shiwang’andu): I thank you Madam Chairperson, for giving me this opportunity to make my contribution on the Vote for the Ministry of Science, Technology and Vocational Training.

Madam Chairperson, year in and year out, the hon. Minister of Finance and National Planning presents Budget Estimates to the House for scrutiny and approval. This year is not any different at all. There has been no time when these Estimates are said to be adequate enough to cater for the needs of this country.

I would like to specifically address myself to the issues pertaining to the youths of this country. I would also like to recognise the presence of two gentlemen, and hon. Ministers, and for some reason, they are seated together. I think the appointing authority should receive my heartfelt congratulatory message and commendation for giving us these ministers who, in my view, are more than adequately educated and qualified.

Hon. Government Members: Hear, hear!

Major Chibamba: That is one aspect of life. The other aspect is that they are also complemented by very able staff.

The Ministry of Science, Technology and Vocational Training is well staffed. At least for now, the Permanent Secretary and directors, that I happen to know very well, are men and women of very high calibre. This may be different. It may be the method and the system of implementing Government policies.

I would like to begin by saying that I have known Hon. Brigadier-General Dr Chituwo for more than thirty years and there would be no reason for me to praise him if he were not qualified or did not deserve it. He is a very able individual and a very committed son of the soil.

Hon. Government Members: Hear, hear!

Major Chibamba: I have not known Professor Lungwangwa who is seated next to him long, but I think that is the best pair Zambia has ever been given through the appointing authorities.

Hon. Government Members: Hear, hear!

Major Chibamba: However, what is required of the two hon. Ministers is to begin to work closely with each other and start planning from where their predecessors left.

Madam Chairperson, in Zambia today, we have an army of youths. The youths in Zambia appear to be captives because there is no space for them to train and begin to look after themselves well and make meaningful contributions to the development of mother Zambia. If there is any, it is limited.

It is, therefore, important that, first and foremost, the Ministry of Education and the Ministry of Science, Technology and Vocational Training embark on a very ambitious programme to create facilities that will help absorb the many thousands of our youths who, at the moment, do not have any room for earning a living. When I say the youths, I also include the girl child. Many of them have not succeeded in getting places at the two universities for various reasons. At times, it is due to high poverty levels and, sometimes, there is just no room for them to proceed to higher education.

The other problem that has been linked to the plight of our youths in this country is that Zambia seems to be taking the issue of engineering as the most important aspect in life. I think there is a need for us to link the craftsman or woman, the technicians and the diploma holder to the engineer. This is important because the few countries that are advanced are doing well in this area. When an engineer designs and it comes to implementation, it is backed, and effectively so, by the craftsman, the technician or the diploma holder.

An engineer is not supposed to implement whatever they design. It is the craftsman or the diploma holder who implements. The engineer is supposed to verify that the design is proceeding according to the technical requirements. They will give specifications of a particular project. They supervise to ensure that their works are according to the requirements of the design.

Madam Chairperson, the other point I wanted to talk about is that every year, Zambia produces about 27,000 or close to 30,000 Grade 12 school leavers. Are all these 30,000 school leavers going to be enrolled at the two universities? The answer is no. What do we do with those children who will not enrol at the two universities of Zambia?

Out of the schools leavers, there are those who may not get the six points required for one to enter a university, for instance, but could be brilliant in one subject which could be a science subject such as biology, chemistry, physics or even mathematics. Is it not possible, hon. Minister, for you to design a programme that will take care of those students who may be very bright in these science subjects? In Europe and America, it is very common. Where a child is brilliant in a science subject, it does not have to have six points to go further with its education. That child is talented in that particular area. He must be absorbed and given proper training. It is out of these people that we have scientists. But in Zambia, there is not much for a child who has not picked up six points. I think this is a point that we must very seriously start considering for our future generation and see what we can do for them.

Currently, we have a situation where the Engineers Institute of Zambia falls under the Ministry of Communications and Transport. I think this is inappropriate. The Ministry of Ministry of Communications and Transport has a political history. Those of us who were there know why that portfolio was taken to the Ministry of Communications and Transport. It must be reversed so that we can have these Engineers falling under the Ministry of Science and Technology. And there must be proper and complete collaboration between the two ministries.

The other point I wanted to ask the hon. Minister is that of the provision of basic tools in these institutions. Basic tools are supposed to be expendable. You cannot buy basic tools and take them to a particular skills training institute and think that you will find them there after six years. They will go with the training process. Therefore, it is important that we constantly replenish these very important means of learning.

Madam Chair, I also would like to make a special request to the hon. Minister. I still feel that the two hon. Ministers can work hand-in-hand to help us in Chinsali to upgrade the current used skills training centre. It does not offer so much. Those of us who were lucky enough to have gone through such an arrangement appreciate that if you are going to do any better, you need to be nearer the college. It does not have facilities such as a boarding arrangement, basic tools and implements that I have just talked about.

We would really appreciate if you could kindly go out of your way, and see what can be done. A lot of things are needed at that institute, including proper water and sanitation and most importantly, we need properly trained instructors.

Finally, Madam Chair, I would like to talk about manpower. As Hon. Chishya has alluded to, there is a lot of expertise in Zambia among the retired, but not yet tired officers. There are people as old as I am or even older who are looking for employment. These should be made full use of so that where manpower becomes a problem you can call on these retired men and women to come and fill the vacancies and be able to help our children to get some proper training which, at the moment, may not be possible.

I think that it is important for ministries of the Government to co-ordinate and collaborate whatever they are doing. The staff that you have must be made full use of. We must pay our staff properly even if am told that now jobs are dwindling in some parts of the world where our experts are going to. I think it is only proper that those that have remained here are properly looked after.

Hon. Members: Hear, hear!

The Minister of Science, Technology and Vocational Training (Dr Chituwo): Madam Chair, from the outset, I would like to thank hon. Members of Parliament who have contributed to my budget estimates. I would also like to thank the hon. Members of Parliament for the support that they have expressed, clearly understanding the role that Science Technology and Vocational Training can contribute to our country’s social economic development.

Madam Chair, I would like to perhaps clarify a few issues starting with our National Institute for Scientific and Industrial Research (NISIR) that are key in research and development. I would like to state that Dr Chishya, who, in fact, is one of those scientists who spent a lot of years there, indeed made correct observations that we started the issue of rehabilitation of the National Institute for Scientific and Industrial Research in many of these areas. However, the issue of rehabilitation and purchase of equipment is a continuous one.

The challenge that our Institute has now is utilising that very expensive equipment. I must agree that it is very, very expensive indeed and the benefit will be in our institute in collaboration with my ministry to find the needs that are vast in the mining and  agricultural sectors where analytical expertise is needed and am sure that we will do.

Madam Chair, the issue of the Star Drilling and NISIR has only recently come to our notice and we will investigate to find out how possible it is that whereas the Act is very clear on the role of the ministry allowing the institution entering into a commercial venture when there is the National Technology Business Centre according to the Act whose mandate is to commercialise these discoveries. 

I understand that this morning, the NISIR Board and the National Technical Business Centre have engaged in some discussion in order to agree on specific roles as specified by the Act regarding where one ends and the other starts from. If that is not possible, we will have to review the Act so that there is no duplication and we can maximise our available expertise.

Madam Chairperson, I would like, perhaps, to say just a few things specifically regarding my colleagues who contributed. I would like to assure Hon. Hamududu that we need more experience in the issue of productivity. I could not do more, but it is evident that in spite of training, that aspect of productivity, commitment and maximising on the time and available resources is lacking even when our students go under apprenticeship. Certainly, we will follow up that and see how it can contribute to our economic development.

Sir, there was the issue of dilapidated institution of Chainama Mental Health College and other colleges. I thank him for recognising that and, as a Government, we have taken note of that and something will be done. 

Madam Chairperson, there is the issue of using our advantage from our history as a centre that even today, we can boast of well trained manpower, be it at the technician level, teacher level, medical office level or nurse level. Indeed, one of the issues we have been discussing is to make Zambia a centre of excellence in the education sector. Something has gone wrong. Why have we not realised this potential we have? Clearly, with my colleague and the hon. Minister of Education, we have been discussing for instance, the question which was asked with regard to the National College for Management Development Studies. There was a question which was asked on this Floor on when the college will be converted into a university. Discussions have started and progress is being made. If not only to have another university, but a university of excellence. This can only be done in partnership and I hope the hon. Member of Parliament for Siavonga will participate in offering his expertise as a lecturer because this is what has been stated here. We have retired men and women with experience who can continue to contribute to the younger generation.

Madam Chairperson, I would like to thank Hon. Mabenga for congratulating my team and also for requesting that we popularise JETS fair at various levels. There is a Budget allocation, which we hope will now scale up the issue of JETS fair and also, just to popularise in science and mathematics. I am aware that every year, we conduct science and mathematics forums for the young people, but this might be possibly not very well publicised. The idea of a science and mathematics forum, in addition to the JETS fair is to bring the young people who have got new innovations and bring them together to compare that which has been discovered elsewhere. Certainly, this is necessary. We will have to scale up so that when we come to the provincial JETS fair and the national one, we really have a cross participation of school students.

Madam, the issue of Evelyn Hone College is very clear. I think in my statement, I did say that indeed, when we have put in infrastructure and have the human resource at the appropriate level, there is no reason we cannot be in affiliation with the University of Zambia so that we can offer as well degree courses, not to neglect the very important requirement for technicians and technologists. As has been stated, we are mindful of that fact that the driver of the economy in any country is the crafts, technicians and technologists and thus, we intend to retain them.

Madam Chairperson, I thank Hon. Chibamba who talked about the various issues which were pointed out with regard to co-ordination between the Ministry of Education and my ministry. That is an issue that was actually started when all of you and my predecessor were there. On the linkage between the Ministry of Education and the Ministry of Science, Technology and Vocational Training after all, historically, it was one ministry which was known as the Ministry of Science and Higher Education, we have no problem and we appreciate that counsel.

Madam, I would like to conclude by saying that we shall continue to use retired expertise. We are doing it at the moment, but at a small scale. I think we need to scale up and utilise these men and women who can still contribute to our country.

Madam Chairperson, with those few words, I would like to support all the hon. Members for the contributions and promise that we will do our best to go to Chinsali, Monze and Mulobezi to see the facilities that are available and see whether indeed, we can have static institutions there, mindful of the fact that ours is a demand-given training.

I thank you, Madam Chairperson.

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

Vote 65/01 ordered to stand part of the Estimates.

Vote 65/02 ordered to stand part of the Estimates.

Vote 65/04 ordered to stand part of the Estimates.

VOTE 65/06 – (Ministry of Science, Technology and Vocational Training – Department of Science and Technology – K3,500,595,352).

Mr Lubinda (Kabwata): Madam Chairperson, I seek clarification on Sub-head 10 – Activity 02 – Junior Engineer, Technicians and Scientists (JETS) fairs – K10 million. I would like to find out whether there is any other fund from which we shall get some money to run the JETS fair because it has been stated in this House that the money allocated to the JETS fair is insufficient.

Dr Chituwo: Madam Chairperson, the K10 million is only a supplement we contribute to the Ministry of Education and jointly fund the JETS fair.

I thank you, Madam Chairperson.

Vote 65/06 ordered to stand part of the Estimates.

Vote 65/10 ordered to stand part of the Estimates.

VOTE 64/01 – (Ministry of Works and Supply – K260,999,237,515).

The Minister of Works and Supply (Mr Simbao): Madam Chairperson, I am greatly honoured to rise and give a brief statement on the 2007 Activity-Based Budget of my ministry to this august House. The ministry is mandated to work on and develop new infrastructure as well as rehabilitating and maintaining the existing infrastructure.

Madam Chairperson, the infrastructure is cardinal to the overall economic and social development of this country. Care has been taken to ensure that we contribute towards wealth creation in the country through improvement of infrastructure and job creation. That is why some of the infrastructure is constructed using weather-based methods through small-scale local contractors.

Madam Chairperson, let me highlight the fact that the strategic theme in the Fifth National Development Plan is a development of infrastructure in order to achieve nationwide developments. Therefore, this theme brings the activities of the ministry at the centre of national development.

 Functions of the Ministry

Madam Chairperson, the ministry also undertakes the following co-functions:

(a) provision of Government offices and VIP accommodation;

(b) construction, rehabilitation and maintenance of Government buildings and roads;

(c) provision of accommodation through hostels and lodges;

(d) Government printing and catering for Government equipment; and

(e) procurement of Government vehicles and control of their movements.

The ministry is also responsible for the construction industry through the National Council for Construction.

Madam Chairperson, the Road Development Agency was established under the Public Road Act of 2002 as a corporate body with perpetual succession and a common theme to provide the following:

(i) the care, maintenance and construction of public roads in Zambia;

(ii) regulation of maximum weight permissible for transmission on roads; and

(iii) provision for matters collected with and incidental to the foregoing.

Madam Chairperson, the Road Development Agency, which is now fully phased at 90 per cent of its core positions have been filled. The agency is a sole authority responsible for development of an integrated programme in the road sector.

Maam Chairperson, having given the parameters within which the ministry works, allow me  to state that  I have the blessings of my hon. Colleague, the hon. Minister of Finance and National Planning to elucidate on the approach we are going to take with regard to the construction of  roads. I say so because funding for roads comes under Head 21, which is controlled by the hon. Minister of Finance and National Planning. Yet, the actual construction of the roads falls under the mandate of the Ministry of Works and Supply.

Madam Chairperson, this is the reason the ministry included explanatory notes on roads in Vote 21 of the Ministry of Finance and National Planning as circulated to hon. Members of Parliament. The hon. Members will appreciate that this is the first time that the Budget explanatory notes are being distributed to all without exception and confirms the fact that the Ministry has nothing to hide.

Hon. Government Members: Hear, Hear!

Mr Simbao: Since I know that all the hon. Members have read the document at no cost, I expect them to give full support to the Budget proposals of the ministry. Allow me to highlight a few pertinent points concerning the work of the ministry.

(i) Selection of roads

Mr Madam Chairperson, currently, about 64 per cent of trunk and many roads are in good condition. It has been difficult to complete some of the roads and bridges because we have been tackling too many projects at the same time as follows:

In the 2007 Annual Works Plan, the Kasama-Luwingu Road has been allocated K20.8 billion; the Choma-Niko Road has been allocated K18 billion; the Mongu-Kalabo Road has been allocated K20 billion; Kasempa Turn-Off to Kabompo Road has been allocated K20 billion; the Chembe Bridge has been allocated K25 billion; and the Kashikishi-Lunchimba Road has been allocated K8.5 billion.

This amounts to K112.3 billion, which is the direct Government funding. The actual Government funding in the Budget is K124 billion. The allocation of money to all the on-going projects falls short of completing or making substantial progress on any of them. For example, in 2007, K20 billion has been set aside for the Kasempa Turn-Off to Kabompo Road. This amount will only cover about 20 kilometres, which, with this kind of allocation yearly, it will take ten years to reach Kabompo.

Madam Chairperson, let me also clarify that the current contract for up-grading the Kasempa Turn-Off to Kabompo Road is only a distance of about 229 kilometres and does not extend to Chavuma. The Government direct funding in the 2007 Budget of K124.3 billion can cover about 124 kilometres. This means that if the whole of this amount is allocated to the Kasempa Turn-Off to Kabompo Road, we could have covered at least half the distance to Kabompo this year.

Madam Chairperson, for us to make real progress on Government direct funding, from which most of the major roads and bridges allocated, for example the Kasama, Luwiingu, Choma, Nikko, Kashikishi, Lunchimba roads, etc, it is important that we tackle one or two roads at a time. What this means is that, if agreeable, we can only rehabilitate Kasempa Turn-Off to Kabompo and Kasama to Luwiingu roads in 2008. In 2009, we rehabilitate the Choma-Niko Road etc. With this kind of approach, we would complete almost all the on going projects by 2010. I appeal to all the Members to exercise a spirit of give and take, to allow that we work on certain roads at a time while others are pending. If we agreed that in 2008 instead of spending K124 billion on eight projects, we only spend it on one or two projects, we would create an impact on the ground as the public would be able to see completed works. In this way, by the end of the Fifth National Development Plan, a reasonable stretch of roads can be completed.

Madam Chairperson, as Minister, at the recommendation of the Road Development Agency, by statutory order, I appoint road authorities in respect of any public road.       The Road Authority is responsible for the construction, care and maintenance of the roads specified in that statutory order. All expenses shall be paid for from the Road Fund.

Recently, road authorities were appointed and their duty is to undertake the functions stipulated above. In line with the method of selection of roads or any intervention, district authorities under which hon. Members of this House are members, propose the roads to be rehabilitated, mainly feeder roads. Once funding is made, it will be the duty of the local authorities who are road authorities to monitor the operation and use of these resources.

Madam Chairperson, I am grateful to you for having accorded the ministry an opportunity to hold a Seminar on Roads and Bridges Infrastructure for hon. Members of Parliament. At this seminar, the Annual Works Plan for 2006/2007 were distributed and discussed. The Annual Works Plan for 2007 has since been reproduced as an extract in all our main daily papers. It is, therefore, important that hon. Members get a copy of these daily papers so that they can again compare what was given to them at this seminar and what is finally indicated in the 2007 Annual Works Plan.

It is, therefore, my hope that they will not raise issues of centralist concern on hon. Members of Parliament who render the necessary support to this Vote.

Provincial Apportionments

Madam Chairperson, I did notice that some hon. Members who spoke earlier on roads infrastructure presented a picture that the Government had not been paying attention to infrastructure in their provinces. This is not true because we have been approaching our Co-operating Partners to assist us.

The overall provincial allocations in the 2007 Budget are as follows:

Province Amount (K) Percentage %

Central Province 63.6 billion 8 
Copperbelt Province 43.9 billion 6
Eastern 70.7 billion 9
Luapula 70.9 billion 9
Lusaka 144.1 billion 17
Northern  86.9 billion 11
North-Western  76.8 billion 10
Southern 123.1 billion 16
Western  108 billion 14

Madam Chairperson, we have just reached a firm understanding with the European Union (EU) that they are going to assist us with 23 million Euros to work on the Nyimba/Chipata/Mwami Border Road. Feasibility studies are starting in August this year.

In addition, the Arab Bank for Economic Development in Africa (ABEDA) has just funded the feasibility study for the Chipata/Lundazi Road and after the board study, they will proceed with the financing of this road.

Madam Chairperson, the Southern Province alone has 16 per cent of the budget on roads, and yet I heard some Members complaining that the road has been neglected. I wish to state that the province has in fact benefited substantially.

The Monze/Zimba Road funded by the EU is one of the best roads in the country. The EU has placed K15 billion this year towards the Zimba/Livingstone Road which remained undone.

The Germans, KFW funded the famous Nakatindi Road at the cost of 23 million Euros. As we speak now, the Germans through KFW will finance the detailed designs and preparation of tender documents for the upgrading of feeder roads to gravel standard in the Southern Province at a cost of K2 billion.

Madam Chairperson, the Lusaka/Chirundu Road is another project which has a substantial proportion of the budget. If this is what negligence means, then I do not know what support people need. In addition, the Kazungula Bridge and its supporting infrastructure are being designed with the support from ADB. The Bottom Road has been allocated K6 billion for periodic maintenance and re-gravelling to improve accessibility. I appeal to hon. Members to consider what the Government has put in the province and not to look at what is specific in the constituents.

Madam Chairperson, on border infrastructure, the Government has heavily invested in the improvement of border infrastructure at Chirundu which has turned out to be a modern town. Further infrastructure development at Katima Mulilo similar infrastructure to that at Chirundu is being carried out. It is Government’s plan to also improve infrastructure at other border posts in Nakonde and Kasumbalesa.

Madam Chairperson, on actual weight control, the ministry is aware that overloading has contributed greatly to the tear and wear of our roads and it is for this reason that the maximum laden and actual weights have been regulated. These are meant to convict any persons contravening actual weights control limits. Recently, Madam Chairperson, I commissioned the computerised Kapiri Mponshi Weigh Bridge in trying to enforce actual weight control.

Madam Chairperson, I would like to pay tribute to the Norwegian Government and the European Union for their assistance in this area. The initial congestions experienced at Kapiri Mponshi Weigh Bridge were as a result of the initial data capture for creating a data base for the details of trucks and drivers which will continue to be used in the future. These details will automatically be transmitted to Kapiri Mponshi and the other RDA headquarters as they are entered at the initial points indicating their destination.

Madam Chairperson, there will be no cheating so as to prevent paying of duty whilst goods are declared as transit and end up being off loaded within Zambia.

Madam Chairperson, on Bailey Bridges, I would like to say that the programme of installing Bailey Bridges at Kaputa and Kabompo was undertaken by the Disaster Management and Mitigation Unit under the Office of the Vice-President. Initially, the ministry was not involved and a number of technical hitches arose. The ministry has since provided technical advice and this problem will soon be resolved. Madam Chairperson, for some Bailey Bridges not installed by some defaulting contractors, they have been convicted and charged to court.

Madam Chairperson, the ministry has submitted to the Office of the Vice-President, the resource requirements of about K13 billion for the maintenance of wash away on our roads and bridges. This is so because the Office of the Vice-President has the mandate for Disaster Management for which a budget is provided.

Madam Chairperson, on Public-Private Partnerships Policy, the ministry has been spearheading the development of the Public-Private Partnerships Policy with other stakeholder institutions in line with the Government policy of engaging the private sector to engage in business in infrastructure development and service delivery. The draft policy has since been submitted to policy analysts coordinating the division for further guidance. The policy once effected will provide for the development of modern and efficient services and value for tax payers.

Madam Chairperson, the Public-Private Partnerships is a co-operative venture …

Madam Chairperson: Order!

(Debate adjourned)

___________

The House adjourned at 1256 hours until 1430 hours on Tuesday, 27th March, 2007.