Minister Mthethwa Interaction with the Creative Industries

23 NOVEMBER 2018

SPEAKING NOTES FOR COMRADE NATHI MTHETHWA, MINISTER OF ARTS AND CULTURE, MEMBER OF THE ANC NEC, NWC AND CHAIRPERSON OF POLITICAL EDUCATION SUB-COMMITTEE ON HIS ON HIS INTERACTION WITH THE CREATIVE INDUSTRY: EMOYENI CONFERENCE CENTRE- PARKTOWN, JOHANNESBURG

I want to extend a hand of warm welcome to all the creative workers and practitioners. 

I want also to express the appreciation to the leadership of the organisation of which I am a proud member to afford me the opportunity to lead this sector. 

The creative and cultural economies are one of the fastest growing industries and should be at the centre of national strategic priority to unlock the wider socio- economic participation and inclusivity in the mainstream economy. 

The impact of commodity-dependent countries like South Africa has refocused attention on the urgency of economic diversification, revitalization and harnessing of human innovation in order to weather the economic storm. The global discourse has identified the next wave of growth to be driven by the Fourth Industrial Revolution that offers new opportunities to achieve inclusivity and sustainability by fast-tracking market integration in Africa through industrial corridors.

There is a lot of untapped potential in the cultural and creative industries to create growth and jobs. To do so, South Africa must identify and invest in new sources of smart, sustainable and inclusive growth drivers to take up the baton. Much of our future prosperity will depend on how we use our resources, knowledge and creative talent to spur innovation. 

Building on our rich and diverse cultures, South Africa must pioneer new ways of creating value-added, but also of living together, sharing resources and enjoying diversity. The sector offer a real potential to respond to these challenges thereby contributing to the some of its flagship initiatives such as the Sustainable Development Goals, AU Agenda 2063 and in the case of South Africa; the NDP 2030 vision.

In this regard together with the sector we have developed a new White paper on Arts and culture, which currently is before Parliament. 

The rational is to address the shortcomings of the 1996 White Paper and reconfigure the current fragmented dispensation to enhance the performance of the sector, by:
Basing the policy on the fundamental right to culture, artistic creativity, language, and intellectual and artistic freedom as enshrined in the Bill of Rights in the Constitution;
Integrating the National Development Plan ,the National Strategy for Nation-Building and Social Cohesion and African Art, Culture and Heritage Knowledge Systems in policies for the sector;
Harnessing the sector’s creative, innovative, educational and social development practices with the economic capacities for transforming South Africa into an inclusive society;
Proposing more flexible funding and financing models for the sector; and 
Reconfiguring the existing arts, culture and heritage dispensation and the policies underpinning it to eliminate duplication and optimise performance.

Benefits of the new policies for the sector
Acceleration of transformation and higher levels of inclusion;  
Elimination of inefficient, cumbersome and wasteful administrative procedures;
Greater coordination between national, provincial and local spheres.
Effective cultural diplomacy and international cooperation;
Correction of the uneven distribution of infrastructure, facilities, materials and resources;

Effective  contribution to economic and social development;

Enhanced  private sector funding and support for the sector;

Effective protection of the social and economic rights of practitioners;

Diversified funding for the sector; and
Improved monitoring and evaluation of the sector.

As South Africa moves into the third decade of democracy it will be faced with new challenges. To meet these, all sectors of society, including arts, culture and heritage, must contribute to creating a better life for all South Africans.

Out of the allocation that the department receive from National Treasury, close to 80% of the budget goes to entities and provincial transfers. Only 7% is left out for the Department to provide the grants to strategic projects as envisioned in the MGE Strategy. 

MZANSI GOLDEN ECONOMY:

The MGE funds continues to provide catalytic funding to the arts organizations, industry bodies and community arts centres around the country. 

However, various studies on cultural and creative sectors highlight the fact that access to finance currently is a core barrier to further development. Own earnings and government grants play an important role in the financing of cultural and creative organizations, but they are only part of a mix of financing sources in most organizations.

The Department has introduced a sector specific fund facility specifically in order to stimulate the provision of loans to ACH SME’s. 

VCF FUND- ACCESS TO FINANCE:

In order to assist the SME’s in the cultural and creative industries to access working capital finance, the Department launched the venture capital fund. 

The Venture Capital Fund for the Arts and Culture was designed to promote and develop the arts and culture sector by providing affordable loans to start and/or expand small businesses. It is an important source of finance for start-up entities and for companies that have limited operating history which do not have access to capital markets. 

DEBUT FUND PROGRAMME FOR EMERGING ENTREPRENEURS:

The Department has invested R4million in Business Arts SA (BASA) as part of the Debut Fund Programme that provides early stage and Start-Up capital to the emerging cultural young entrepreneurs across the country. 

YOUTH INCUBATOR INVESTMENTS:

Talent itself is a great asset; however the nation must go beyond that to develop a sustainable sector. South Africa’s future cultural and creative entrepreneurs need the necessary educational structures, legal systems and investments to professionalize their sectors. The current limitations of the local cultural and creative scene, often leading to a brain drain of young creative talent, need to be transformed into new opportunities for access to local and international markets.

To increase the professional development of artists, the DAC since 2015 initiated the Creative Arts Incubator Programme through the performing arts institutions and private incubator initiatives. The aim of the DAC incubator programme is to provide the young artists with holistic arts, creative, professional business training that will propel them to breaking grounds in the industry and also develop models of developing to fully fledged arts enterprises. The incubator programme has benefited 2961 young artists since 2015. 

The young artists have produced and staged in more than 30 productions in Theatre, Music and Dance since inception. The Public Entities Hosted the 2nd Edition of the Trade Fair. Phase 2 of the programme is also to open to doors of learning to private incubator initiatives. To date, 5 such incubator initiatives have been supported to train young actors, filmmakers and playwrights. Phase 3 of the programme will be geared towards support of the business incubators where artists will be empowered with business growth tools.  

PERFORMING ARTS ACADEMIES:

The Department has supported the construction of the National Academy of Performing Arts in Jabulani Soweto by Caiphus Katse Semenya Foundation. The academy will be training ground for the youth in the various preforming arts disciplines with a special focus on the Pan- African Curriculum. Also we have supported Isicathamiya mobile academy led by Ladysmith Black Mambazo.
The Department has also set aside funds towards the construction of the Polokwane Theatre in partnership with the Provincial Department.  

MGE INVESTMENT TO RESEARCH AND DEVELOPMENT:

In order to strengthen the Research Capacity of the sector which has lacked evidence based outcomes, the Department has launched the South African Cultural Observatory which is a research arm for the sector that support the collection and analysis of data, champion evidence, inform policy development, share insights and disseminate cultural as well build intellectual capacity across the cultural domains. 

The recent studies shows the following insights; 
GDP (2016):  Direct contribution R63, 385 billion (1.7%) & it increases nominally to 5.7% R233bil if the multiplier effect is factored into the equation.

Employment: cultural occupations made up 2.52% of all employment in SA.

The cultural sector also provided employment in non-cultural ‘support’ occupations for 4.2% of all those who had a job in 2015.
Altogether, the ‘Cultural Economy’ accounts for an estimated 6.72% of all employment in SA.

To enhance the evidence provided by the research arm and to create an environment for the sector to flourish, we have amended the two pieces of legislations which are critical to the sector; namely

AMENDMENT OF THE COPYRIGHT ACT (1978) AND THE PERFORMERS PROTECTION ACT (1967)

As part of this process the Portfolio Committee (PC) on Trade and Industry had on 15 November 2018 adopted two proposed Bills – Copyright Amendment Bill and the Performers Protection Amendment Bill with the view to introduce new measures and rights within the copyright regime. 

The mission was to try to reverse the legal rules with the view of introducing structural transformation that will lead to a situation in which the copyright system is not used as an exploitive tool but as a means to promote economic growth and development of local people, in particular by empowering the creators by introducing clauses that will balance bargaining powers when making business and this include provision of more rights to creators and introduction of prearranged contractual guidelines. Resale rights for visual artists will be introduced for the first time in the copyright regime.  

The other aspect was to also improve the system of royalty management, as it relates to non-compliance by users and collecting societies. The Bills therefore introduce prescribed ways of royalty collection, management and distribution to be adhered by users and collecting societies The rules will include proper reporting by content users, accreditation of all collecting societies by government, proper financial reporting by collecting societies. The Bills introduce grave penalties for noncompliance.

Lastly, the bills also proposes the establishment of a copyright tribunal to deal with any copyright disputes and this will go a long way to assist artists who cannot afford expensive litigation processes. 

Thank You.