Parliamentary Committee Report to be presented tomorrow morning

++This entry is based on a note sent to the MineWatchZambia network by Peter Sinkamba, Executive Director of Citizens for a Better Environment, Kitwe: p_sinkamba@yahoo.co.uk. Peter's lobbying efforts are also reported in The Post newspaper today (as always with links to the Post, you need a subscription to access this). The Post also reports backing for MineWatchZambia's proposals for renegotiation of the Development Agreements from University of Zambia (UNZA) School of Mines Professor Imasiku Nyambe and Economics Association of Zambia (EAZ) national secretary Chibamba Kanyama.++

The Bill to amend the Mines and Mineral Act in Zambia has been tabled in parliament and presently it is at Committee Stage.

Relevant to the network is the Mineral Royalty Tax. According to the Bill, government is proposing to increase from 0.6 to 3% for base metals including copper. The proposal for gemstones and other precious metals is 5% and for other minerals is 2%.

The most frustrating thing is that government has inserted an exclusion clause. According to the draft bill mining companies which, by April 1st 2007, will be in possession of holding development agreements with government to pay less than the proposed figure will not be affected by the amendment. Fundamentally what this exemption implies is that we are just going around in circles. If all of the main existing mines are exempted from the increase then what are going to achieve by the increase in real terms?

The whole of last week our organization was busy lobbying with Copperbelt-based MPs, the Parliamentary Committee on Estimates (which is looking at the Bill), the Attorney General and the Minister of Mines, to on the one hand get the exclusion clause removed from the Bill and on the other hand introduce clauses which will govern appropriation of Royalty payments. We have made suggestions to the above mentioned to the effect that a percentage of Royalty tax need be retained in the mining areas for environmental and socio-economic mitigation. Our proposal is that 80% goes to central treasury, 10% goes towards a fund which will look at minerals development, and 10% is shared between the local councils and traditional councils in the areas where mining is taking place. The response on this aspect was quite favourable from above mentioned stakeholders and an assurance was given by the Attorney General that his office was going trigger the consulation process to integrate our proposal into the Bill. To support our call for deletion of the exclusion clause, we indicated that some NGOs were already pursuing various avenues through which to deal with the companies, so insertion of such a clause would prejudice our strategy.

The Parlimentary Committee will present its report to the full House tomorrow morning (Friday 23 March) at around 9am. I suggest that those concerned follow-up the outcome [MinewatchZambia will attend the report launch and report back on this blog]. I further suggest that our proposal be backed by all those concerned with benefit-sharing issues in the extractive sector, perhaps by way of a petition.
Sincerely,
Peter Sinkamba