Cape Town — Debate on the nationalisation of the mining industry was revived in Parliament yesterday, with the chairman of the mineral resources portfolio committee saying the only way to avert it was to create a successful state- owned mining company.

And a government official told the committee that such a company already existed, and had begun to build up an asset base.

The comments by committee chairman Fred Gona -- formerly the parliamentary representative of the National Union of Mineworkers -- provided a further indication that debate on nationalising mines is alive and well in the ruling party.

Gona dismissed as a "scare tactic" industry claims on transformation chasing away foreign investors.

The tripartite alliance is split on nationalisation of mines, with the Congress of South African Trade Unions (Cosatu) supporting it and the African National Congress (ANC) wanting to confine the debate to its internal structures.

The ANC has tried to distance itself from the call by its youth league president, Julius Malema, for mines to be nationalised. His comments caused jitters in the business community, and led to warnings about investment flight.

Gona said at a briefing with departmental officials that nationalisation had to be retained as an option in case the state-owned mining company was not successful.

He urged the state to accelerate the formation of the company, saying this would "quieten calls for the nationalisation of the mines". He conceded, however, that it would take several years to accomplish.

The labour movement sees the creation of a state mining company as critical, not only as a provider of jobs and a driver of transformation in an industry that it believes has resisted change, but also as a source of funds for the state to use in addressing social needs.

Gona warned that unless inequalities and deprivation were addressed, sporadic uprisings against poor service delivery would become co-ordinated into a "serious rebellion" against the state, and would make events in Zimbabwe look like a "Sunday picnic".

Deputy director-general of regulation in the Department of Mineral Resources Jacinto Rocha told MPs the state-owned mining company already existed, and was building up an asset base.

Seeking to allay industry concerns that a state-owned mining company would get preferential treatment from the government, he stressed there would be fair play.

The company would have to operate within the same laws and regulations as other mines.

Gona said a dormant state- owned mining company registered in 1944 would be used for the new venture, which would bring together all state mining interests, such as those held by the Industrial Development Corporation and Alexkor.

A report on transformation in the industry would be submitted in mid-October, said Gona, but he was already able to note that not enough had been done. It was found that excuses were made that black skills were not available.

Rocha said industry could no longer continue to rely on the white minority to supply skills requirements. The government would be using the social and labour plans as a powerful tool to achieve transformation.

Gona dismissed as a "myth" and a "scare tactic" the notion that transformation would drive away investment, noting that investment did not dry up in war-torn Angola or strife-ridden Zimbabwe where the rule of law had collapsed.

"If those investors want to go, then please let them take their decision, but they will leave our mineral resources here and we will develop them," Gona said.

He was scathing of the "almost nonexistent" transformation in the industry.

Changes that had been effected were "cosmetic". For example, the equity stakes owned by blacks in mining companies were "meaningless" with many trapped in debt and not having received dividends for about 10 years.

Black appointments were window-dressing, Gona said, as they were predominantly made to nonexecutive posts, which lacked real control.

He said the committee would push for clear time-frames for the review of the mining charter.