Industrial Policy Action Plan (IPAP); Debt Relief proposed policy: National Consumer Tribunal input, with Minister

Meeting report

Industrial Policy Action Plan

The Minister of Trade and Industry, Dr Rob Davies, presented IPAP for the 2017/18 term with specific focus on the economic sector, infrastructure and employment cluster. He described IPAP as a key component of the President’s Nine-Point Plan, which was informed by the vision set out for South Africa’s development provided by the National Development Plan. He said that IPAP also served as one of the key programmes of the New Growth Path (NGP) and was aligned to both the Medium Term Expenditure Framework (MTEF) and the Medium Term Strategic Framework (MTSF), with special focus on minerals and beneficiation, agriculture and agri-processing, energy, attracting investments and growing the oceans economy.

The Minister further stated that IPAP facilitated economic restructuring by supporting radical economic transformation by focusing on patterns of ownership, management and control, with a central focus on the manufacturing sector and that employment and integration was a key priority across sectors.

The core objectives of IPAP were thus diversification of the economy through the provision of support for value-added manufacturing, building regional investment, trade and industrial development integration. Movement was towards a knowledge economy and collaboration with the private sector in preparation for the adaption to the challenges in digitised production and logistics associated with the “fourth Industrial Revolution”. He said that the transversal focus areas for 2017 were primarily innovation and technology, public procurement, special economic zones (SEZ), developmental trade policy, industrial financing through incentive schemes and African industrial development.

The Minister outlined the focus areas of IPAP for the period 2017/18 as sectoral focus area one of IPAP, which included the automotive; clothing, textiles, leather and footwear; metal, fabrication, capital and rail transport equipment; agri-processing; forestry, timber, paper, pulp and furniture; plastics; and chemical, pharmaceuticals and cosmetics industries.

He said that sectoral focus area two included the primary minerals beneficiation; water and sanitation; marines manufacturing and associated services; green industries; aerospace and defence; business process services and electro-technical and white goods industries.

A further 15 key themes were highlighted for 2017/18. These were:

• Radical economic transformation which involved upscale efforts to secure shared and inclusive growth through transformation of ownership, management and control;
• Programme alignment which involved securing a streamlined, interdepartmental ‘clearing house’ to align policy and programmes to ensure all departments were supporting the industrialisation effort;
• Cutting red tape by continuing efforts to achieve a well-regulated, integrated, development-friendly investment framework to raise levels of productive capital inflows;
• Strengthening of efforts to raise aggregate domestic demand through localisation of public procurement;
• Stronger ongoing focus on labour intensity across value chains;
• Stepped-up export effort with focus on existing exporters, emerging export-ready firms and strong support for new black-owned industrial export entrants;
• Energetic implementation of the national Buy Back SA campaign with full support of Proudly SA, SOCs and the private sector;
• Strengthened efforts to build a less concentrated, more competitive economic and manufacturing structure which lowered barriers to entry;
• Building a stronger system of industrial finance and incentives to support and secure higher levels of investment in the productive sectors for the economy;
• Ensuring the foreseeable effects of the “fourth Industrial Revolution”, understanding emergent disruptive technologies and adapting South Africa’s productive and service sectors accordingly;
• Concerted national effort led by the security cluster, National Regulator for Compulsory Services (NRCS) and customs to combat the illegal economy;
• Beneficiation which involved ongoing effort to secure technology-intensive, value-adding production capabilities to utilise South Africa’s comparative resources endowment advantage as a global competitive advantage;
• Technology optimisation, transfer and fusion;
• Gas industrialisation, employment multiplication and lowering of carbon-intensity; and
• Greening and carbon mitigation efforts through all sectors of the economy.

He said that a number of challenges were also identified for the 2017-2020 period, which included amongst others:

• The decline in primary sector performance with regards to investment, output and employment;
• Domestic economic constraints such as the escalating electricity prices, high port and rail cost and inefficiencies;
• Policy uncertainty and programme misalignment such as weak compliance with legal procurement requirements by government departments;
• High input costs where private sector market power enabled high pricing for key downstream sectors;
• Red tape and regulatory delays, particularly with respect to securing coherent, integrated and development-friendly legislation and regulations;
• continuing effects of the Great Global Economic Recession;
• Deep-seated skills shortages and mismatches;
• Weak domestic demand and persistent unemployment;
• Lagging manufacturing and value-add which saw an investment share of the GDP below 25% needed for sustained economic growth;
• Deindustrialisation which saw manufacturing shrink from its peak of 28% of the GDP to just 13% over the past two decades; and
• Financialisation of the economy with Finance, Insurance, Real Estate (F.I.R.E) sectors growing at twice the rate of the productive sectors and continuing resource dependency.

The Minister said that the key action areas for 2017-2020 were highlighted as BB-BEE transformation; industrial finance, incentive and export support; strengthening of the procurement instrument; technology transfer and diffusion; policy coherence and alignment; anticipation of the “4th Industrial Revolution”; SOC oversight; cleaner energy to drive industrialisation; strengthen national export drive; beneficiation; green adaptation; and implementation of National Buy Back SA campaign.

Discussion

Mr A Williams (ANC) asked what measures were being taken to ensure that local procurement was in fact happening, particularly from state-owned companies and those that received some departmental incentive money. He asked what happened to those SOEs that did not comply with this and requested that a list of those SOEs and companies be given to the Committee so that they could be given a hearing to explain their non-compliance.

Ms C Theko (ANC) asked how best the Committee could approach the problem of local procurement and to come out of the recession.

On local procurement the Minister said that there were a couple of World Trade Organisation protocols, one of which was the Optional Protocol on Transparency in Government Procurement to which South Africa was a non-signatory. Every state that signed this would have to have access to the same government procurement. By remaining non-signatories, South Africa was able to make its governmental decisions to procure from local sources, as did many other countries. South Africa was also affected by something called Trade Related Investment Measures, which meant we it could not compel the private sector to do the same in their private operations. An example of this was in mining equipment; a law could not be passed to compel the mining industry to buy locally so government had to use other means to achieve that.

He said that there were also a few localisation measures which pre-dated the designations. One of these measures was the National Industrial Participation Programme, which required that if you had something that cost around $10 million or more, there had to be some offset arrangement. The other was the exemption from that which was the Competitive Supplier Development Programme which applied to Eskom and Transnet which were required to set their own localisation programmes and policies, which was also now becoming a matter which government would have to address. The other measure which was introduced was the designations where all organs of state, at all levels of government, had to procure specified items in specified percentages from local sources. These designations were done in consultation and rationally and where it was translated into a practice note by National Treasury (NT), it was no longer optional but rather compulsory. An example of which was that all work-wear required in public entitles was supposed to be locally manufactured. The Minister also mentioned that it also had to be borne in mind that local manufacturing applied to the domicile, so even if the manufacturing company was American but operated in South Africa, it still counted as local.

The Minister admitted that there were in some cases non-compliance with local procurement requirements and that this was where the government sincerely wished to take action. The Minister said that this was where government engaged with the Office of the Auditor General. There was a measure called “compliance with applicable legislation” which was part of and recorded in an audit finding. If one was not compliant, then it would reflect in the audit finding as a violation of the designation.

Mr D Macpherson (DA) said that he was surprised that the Minster did not touched on the crisis in the manufacturing sector or mention more about the recession. He said that a plan was put down but no explanation was put out as to how that plan would be mobilised. He remarked that he understood why that may be, saying that the Cabinet reshuffle in March had a negative impact on GDP growth and that policy priorities damaged investor confidence. He said that as a Minister, it was probably torrid to sit and watch one’s work continue to be wrecked at every turn by one’s Principal being the President and that perhaps the Minister gave up and did not know what more to do. He said that quite honestly, IPAP would not get the nation out of the crises it was in. There was too much policy confusion; there was no policy which took precedence and directed efforts.

The Minster replied that by committing to the achievement of better enforcement, better coordination and addressing issues relating to IPAP would be solved. He added that at the heart of it, it was necessary to address the governance of SOC’s.

Ms Van Schalkwyk asked about the projected job creation figures of the different programmes which were outlined to improve the unemployment rate. She also asked whether there really was sustainable job creation. She also asked what the role of other law enforcement agencies was in minimising the illegal economy.

Ms N Louw (EFF) reiterated Mr Williams’ sentiments about the lack of reference to the recession. She requested that the Minster furnish the Committee with a list of names, gender and amounts allocated to the four black industrialists that were mentioned as beneficiaries in the presentation on slide 9. Furthermore, on slide 12 there was mention of 27 approved projects to the value of R557 million which she wanted to know the specifics of the division of that amount allocation as well, and requested to be furnished with a comprehensive list. She further expressed concern for the low payment, commission basis or otherwise abuse that call centre workers were subjected to.

On the question of black industrialists, the Minster said that they would provide a list in the annual report of all the people who received DTI incentives. He explained that there were two stages, first, you got approved and then you got allocated the funds. In deciding who got approved, the factors listed were that the operations had to be manufacturing and liability had to be own-risk. The Minister added that the people in those positions were actual engineers and qualified industry people, and not politicians, and that he was absolutely confident to stand up and showcase those people.

Ms Louw followed up by suggesting that it would be better policy for the names to be revealed right now and questioned the reluctance of the Minster to reveal the names immediately after approval. She added that if state money was going to be given to people, those people needed to be held accountable if they were receiving money from the state and only being publicised after such money was given. What were the chances of that money already being misspent? She requested those names urgently.

Mr J Esterhuizen (IFP) criticised IPAP, saying that the economic costs were clear but not so much the benefits thereof. He said that industrial policy should also guarantee that the country as a whole should make additional money to raise the overall living conditions of the nation. He also remarked on the exorbitant costs of imports that continued to take precedence over local procurement compliance. He also added that we were over-regulated in this country and that SOZs were not viable because they worked under the same crippling labour regulations.

The Chairperson asked whether, with reference to R&D, DTI was working directly together with the Department of Science and Technology in this area or was it a separate unit or was it being promoted across all government departments.

Adv A Alberts (FF+) said that there were certain contradictions that would skew the plans that would thwart the plan which was put on the table such as the fiscal policy, our economic downgrade, high levels of corruption in tendering and resistance from some other Ministers and other parastatals such as Eskom’s resistance against Green energy. He wanted to know, essentially, how those external pressures would be dealt with in terms of IPAP. He suggested that the Minister extend experimentation and create SEZs in which they applied different formulas to the areas of labour and various forms of incentives to see whether it worked or not.

Ms Yvonne Dalis, Deputy Director: Industry Development Advisory Unit, Department of Trade and Industry, admitted that there was a noticeable lack of policy coordination to which they would tend through the IPAP. She said the Department tried to make the point clear that it identified the systematic contradictions and that it was putting more emphasis on programme alignment and cutting of red tape. She said that the Department wanted to develop an interdepartmental framework to combat these policy bottlenecks.

The Minister added that while we compared South Africa to other countries, it must be remembered that those countries also had industrial policies which were designed to support the needs of their economy. Policies were the ladders which were used to climb to the top. The Minister also said that much might be said about the negatives in South Africa but that there were also some positives that investors recognised and on which we needed to build.

The Chairperson added that she was a public representative since 1994 and in the period since then she could categorically say that the fastest level of industrialisation in this country was under this Administration. She said that this needed to be recognised in spite of the issues that were raised. She also commended the Committee for their critique and robust interrogation of IPAP and reiterated that it was an integral, overarching plan towards a better South Africa.

Courts of Law Amendments Bill (Emoluments Attachment Orders)

The Chairperson introduced the presenters of the briefing as Mr Mohamed Dawood, Director of Court Services in Department of Justice (DOJ), Ms Engela Steyn, Law Advisor in the Legislative Department and Mr Lawrence Basset, Law advisor in Legislative Development of the DOJ.

Mr Basset said that the Bill was introduced into Parliament in May 2016. Submissions were received and public hearings held in August 2016. In September, October and November deliberations took place and the subsequent approval was sought and obtained from the National Assembly (NA) in terms of rule 286(4)(c) to insert section 55A as it was not part of the Bill as introduced. The Portfolio Committee approved the Bill on 10 May 2017 and NA approved and transmitted the Bill to the National Council of Provinces (NCOP) on 6 June 2017.

Ms Steyn spoke on the Bill itself and said that the purpose of the Bill was to amend various sections of the Magistrate’s Court Act No. 32 of 1944 (MCA) mainly to address:

• Alleged abuses in the civil debt recovery system and to provide for more judicial oversight over judgements and emolument attachment orders (EAOs);
• To provide for the recession of judgment where the judgement debt had been paid;
• To transfer regional court judgements to district courts for the debt collection process; and
• To amend the Superior Courts Act No. 10 of 2013 (SCA) by the insertion of a new section 23A which provided for the recession of judgement with the consent of judgement creditor and for the recession of judgement where the judgement debt was paid.

She said that amendments to the MCA came about as a result of widespread abuse of the civil debt recovery system in the magistrate’s courts, the Constitutional Court judgement in Stellenbosch University Legal Aid Clinic and Others v Minister of Justice and Correctional Services and Others [2016] ZACC 32 (hereinafter referred to as Stellenbosch University Legal Aid Clinic and Others) and the DTI’s removal of adverse consumer credit information project, which also included proposals for the recession or abandonment of judgments where the debt was paid.

Amendments to MCA included:

Clause 2 amendment of section 36:

The DTI suggested the insertion of an automatic procedure to enable judgment debtors to rescind a judgment where the judgment debt was paid in line with section 71A of the National Credit Act (NCA), but reports of fraudulent recessions emerged and an automatic process did not seem appropriate.

A simple application procedure was therefore inserted providing for recession of judgment where judgment debt was paid. The application was brought by way of prescribed form which may also be heard in chambers and the courts were empowered to make a cost order it deemed fit.        

Clause 3 amendment of section 45:

Section 45 was abused by requiring consumers to consent to the jurisdiction of the court far away from where the consumer resided, carried on business or was employed, which made it difficult for those consumers to challenge a judgment order made at that court.

The Constitutional Court in Stellenbosch University Legal Aid Clinic and Others declared that section 45 did not permit a debtor to consent to the jurisdiction of a magistrate’s court order other than that in which the debtor resided or was employed in respect of enforcement of a credit agreement in terms of the NCA.

Consent was given in proceedings in terms of section 57, 58, 65 or 65J by defendant or judgment debtor to the jurisdiction of court which did not have jurisdiction in terms of section 28 was of no force and effect.

Clause 4 insertion of section 55A:

The Constitutional Court ordered that the court must authorize and EAO after satisfying itself that it was just and equitable that an EAO be issued and that the amount was appropriate.

Section 55A sought to provide guidance to the courts as to the factors a court had to take into account when deciding if an order was just and equitable.

Clause 5 amendment of section 57:

The court must enter judgment and authorize instalment orders, and not the clerk of the court; more documentary proof of income and expenditure of the debtor was required and if the claim was based on the NCA it had to be dealt with accordingly.

The court may authorize and EAO if the defendant was employed and such an order was just and equitable. The Court may also make a costs order as it deemed fit in order to curb excessive costs charged by attorneys.

Clause 6 amendment of section 58:

Same as above clause 5 amendment of section 57

Clause 7 amendment of section 65:

Same as above clause 5 amendment of section 57.

Clause 8 amendment of section 65E:

The reference to consent to an EAO was removed and the court must be satisfied that it was just and equitable that an EAO be issued and the amount was appropriate.

Clause 9 amendment of section 65J:

An EAO must be issued from the court where the judgment debtor resided, carried on business or was employed and may only be issued after authorization by the court. Amount or total amount of the instalments payable may not exceed 25% of the debtor’s basic salary. Provision was made for the division of the amount to be committed to an EAO where there was more than one EAO.

A notice of intention to have an EAO issued must be served on the debtor and employer who may file notice of opposition. If creditor or attorney did not accept reasons for opposition, matter may be set done in court for hearing.

The court may rescind or amend the EAO to make any order including an order as to the division of the amount available. The judgment creditor or attorney must furnish the employer (garnishee) and debtor with quarterly statements containing particulars of payments received and balance owing, free of charge.  After service of an EAO, if a garnishee believed or became aware or was otherwise shown that the debtor would not have sufficient means left or that the amounts claimed were erroneous or not in accordance with the law, the judgment creditor or attorney must be notified without delay.

If the judgment creditor or attorney did not accept the reasons for believing or knowing that the debtor would not have sufficient means, the matter must be set down for hearing. The court may rescind or amend the EAO or make any order including division of the amount available.

The garnishee who unreasonable failed to timeously deduct the amount or stop deductions after the full debt was paid will be liable to repay additional costs and interest or any amount deducted after the debt was paid to the judgment debtor.

Clause 10 amendment of section 65M:

Section 65A(1) implied that the regional courts could not make financial enquiries. The amendment provided for the transfer of judgments of regional courts to the district courts to conduct financial enquiries, similar to position with regards to high Court judgments.

Clause 13 insertion of section 106C:

Section 106C outlined offences relating to judgments, EAOs and instalment orders. It would be an offence if a person required another person who applied for a loan to consent to judgment or any other instalment order or EAO or imprisonment not exceeding three years. It would be an offence if a person fraudulently obtained or issued a judgment or instalment order or EAO. Penalty for this was a fine or no more than three years’ imprisonment.

Amendments to the SCA:

Clause 14 insertion of section 23A:

Section 23A provided for the rescission of a judgment when the consent of the judgment creditor and where the judgment was paid. It was similar to section 36 of the MCA.

Clause 15 transitional provisions:

All legal proceedings in terms of the sections to be amended by the Bill, which were instituted before the commencement of the Bill, must be constituted and concluded as if Bill was not passed, provided that the original judgment, installment order or EAO upon which the proceedings were based was obtained and granted in accordance with the law.

An investigation of prosecution or other legal proceedings in respect of conduct which would have constituted an offence in terms of section 106C, which was initiated before the commencement of the Act, must be concluded, instituted and continued as of the Act was not passed.

Provisions was made for a judgment creditor or a judgment debtor or any other person affected by a default judgment and subsequent order which was believed to have been irregularly obtained to apply for the review thereof using the prescribed form in the Schedule, with the assistance by clerk or registrar of the court. Operation of the subsection ceased after a period of three years from the date on which the Act or the last provisions of the Act came into operation, to avoid possible abuse of the provisions.

Clause 16 short titles and commencement:

Comes into force on the date fixed by the proclamation in the Gazette and different dates may be fixed in respect of different provisions.

Mr Dawood stated that the Department of Justice and Constitutional Development (DOJCD) and Office of the Chief Justice (OCJ) have jointly embarked on intervention to put in place measures to minimize and eradicate the incidents of issuing fraudulent court orders. A series of circular directives were issues to this effect. The Court Orders Integrity Committee, a multi-sectoral committee with representatives from the Judiciary, SAPS, OCJ, DOJCD, Organized Legal Profession and NPA, chaired by Judge President Mlambo of the Gauteng Division of the High Court, was also established to unravel the prevalence and practices of fraudulent activities relating to court orders at both the Superior and Magistrates Courts.

The mandate of the committee was to identify patterns and processes employed by the perpetrators in an effort to assist the focus of investigations on a national scale; ensure early detection of patterns of corruption which negatively affected the efficacy of the justice system; advise on steps to capacitate the courts in eradicating the scourge of fraudulent court orders and on the requirements of an automated court system to address these concerns.

The committee was also mandated to educate the public in the court processes and create awareness on steps to eradicate fraudulent practices. All judges would have specifically designed security stamps in line with the stamps provided to magistrates. In future, there was a view to also incorporate the use of watermarked documents to print court orders and a system to generate court orders reflecting Unique Identification Numbers (UIN).

He said that since 2015 there were some 58 cases of fraudulent court orders investigated by the committee of which four of those saw employees being sanctioned with three months of their salaried dropped, in three cases the dates for the disciplinary hearings were still pending, in twelve of those cases matters were being dealt with as criminal investigations, eight of those officials resigned from the Department and some of those remaining cases reverted to the Office of the Chief Justice because they involved the High Court.

He added that the draft Insolvency Bill and Debt Collections Amendment Bill was set to be discussed in a later meeting.

The Chairperson agreed to these aspects being dealt with at a later stage.

Discussion

Mr Macpherson acknowledged that good work was done to curb abuse of the EAO processing by the courts but wanted to know what was going to be done to capacitate the courts to deal with the amount of applications that were going to continue to be made. He also expressed concern as to the engagements the DOJ had with the Law Society on those lawyers that abused the system to obtain EAOs.

Mr Dawood responded that Mr Macpherson could rest assured that a complaint was lodged with the NCR in 2015 soon after the discoveries were made. The corresponding attorney in the matter at the Ermelo Court was currently appearing in the Regional Court on a criminal offence for violation of section 14 of the Organized Crime Act.

Ms Steyn said that there was an intervention by the Judicial Quality Assurance Office of the Magistrates Commission where they increased the number of posts of magistrates.

Mr Macpherson added that he did not think than an avalanche of posts would really deal with the issue of capacity and that his concern was more whether the presiding offices would have adequate training and skills capacity. However, since the issue of job posts was brought up, how would the DOJ deal with financing those posts and the support staff that would need to be employed in relation to those official posts? He also requested that a more comprehensive plan outlining this strategy be drawn up and submitted to the Committee for tabling.

Mr Williams said that he assumed that clauses 5, 6 and 7 in which more documentary proof of income and expenditure of the debtor were for the purpose of determining affordability for the debtor and wanted to know whether this same measure could be extended to curb reckless lending. He also asked that if it was established that the debtor was unable to repay the debt, what exactly happened to that debt.

Ms Steyn confirmed that the purpose of increased documentary evidence was to determine the financial position of the debtor and was based on the NCA.

Mr Esterhuizen added that South Africa had near 25 million credit active people and it was estimated that about 9.85 million were three months or more behind on installments.

Adv Alberts said that credit advisors have come to him with the problem that courts gave court orders against credit advisors in some cases when they applied for a court order even though they had complied with the NCA. Magistrates in these cases would just respond in giving a punitive court orders against the advisors themselves. Was this allowed?

The Chairperson argued the placement of the word “fraudulent” and the application of Roman Dutch Law in spite of our Constitution.

Mr Basset responded that the offence already existed but the insertion of the word “fraudulent” was to make the wrongfulness element more explicit. He added that any unanswered questions would be addressed at an agreed later meeting. 

The Chairperson thanked the delegation and reminded them that they would need to return to answer the remainder of the questions and deal with the other issues in the presentation.

National Consumer Tribunal Proposed Debt Relief Measure

The Chairperson remarked that it was amazing how long some issues stayed on the statute book and presented such a lasting challenge. She also expressed her discontent for the archaic prescripts of Roman Dutch Law. She then introduced the members of the delegation from the National Consumer Tribunal (NCT).

Professor Bonke Dumisa, Acting Executive Chairperson of the NCT, explained how his team would proceed on the presentation. Professor Joseph Maseko, Tribunal Member, NCT, would conduct the presentations and Ms Marelize Bosch, Chief Operations Officer, NCT, would support him.

Prof Maseko started by explaining that they were not the authors of the document before the Committee so they would not assume the role of protagonists as such, and would be only be speaking on aspects which caught their own attention and not with a vested interest as such. He said that the specific aspects that they would focus on spoke more to the legality and constitutionality of some of the proposals that were supposed to effect amendments.

Prof Maseko explained that the NCA correctly did not empower the NCR to impose remedial sanctions. He said that what they noticed was that the one of the proposed amendments actually sought to effect this despite section 15(e) of the NCA which already empowered the NCR to issue and enforce compliances notices. In terms of section 55 of the NCA, compliance notice informed the receipt thereof that their conduct was in contravention of the NCA and outlined the steps to be taken to become compliant and the consequences of further non-compliance. As it stood, the NCR did not assume the role of police or judge but rather was empowered to issue notice of non- compliance, and if not complied with, to refer the matter to a third party which was currently the Tribunal.

Prof Maseko used the example that the NCR was like a traffic officer. A traffic officer was not a judge but merely had the power to say that they believed the motorist committed an offence on the road and subsequently what the motorist would be fined if they admitted to guilt. He said that it was not a final order because in the same ticket the motorist would be issued with a court date on which they could appear in court to defend their actions. This was the nature of compliances notices, they were similar to traffic tickets.

He said that if the Act had to be amended in such a way that the NCR actually produced orders which had to be complied with, it would mean that the NCR would become the police who investigated the case and the judge who also judged the case, which would contradict the Constitution, which guaranteed fairness both procedurally and substantially.

He added that it was unclear in which effect the NCR utilized this power in terms of the NCA. Between 1 April 2010 and 30 March 2017, the NCT only received five applications to enforce compliance notices by the NCR. In addition, the NCT received 11 applications which objected to compliance notices which were issues. These would have been appeals against the NCR if they were to be in the form of judgments by the NCR as proposed. It was not clear exactly how the NCR would be more effective if its powers were increased to enforce its own decision. The 11 challenges made against its judgments would just become appeals.

Prof Maseko said that there were a number of challenges to the view set out in the Credit Law Review documents, especially in relation to the transferring of some administrative functions currently residing with the NCT to the NCR. The amendment would in essence allow the NCR to be investigator, prosecutor, judge and punisher in relation to their own matters and in effect result in some constitutional difficulty. Prof Maseko added that although such an amendment could be made by Parliament since it was within Parliamentary powers to do so, it would still fall short of Constitutional muster.

Prof Maseko then went onto the list the challenges that the proposed amendments pose:

• Institutional bias;
• Absence of public hearing;
• Procedural unfairness;
• Technical issues relating to procedural fairness and natural justice; and
• Unintended consequences of over-arching. 

Prof Maseko went in to great detail on the administrative law pertaining to the underlying legal principles which informed the challenges to which the Chairperson commented that there may have been some misunderstanding as to substance of the brief since the substance of the presentation was beyond what the Committee anticipated or was specifically competent at engaging with in relation to debt relief procedures.

Discussion

Mr Macpherson said that there were some really important conversations that needed to take place with the NCT because he was not convinced that the way that they were constituted as a tribunal actually helped with the work they tried to do. He said that his personal view was that they should be constituted in a similar fashion to the Commission for Conciliation Mediation and Arbitration (CCMA) which took away the need for legal representation which allowed people who would otherwise not be able to afford legal representation the opportunity to a fair procedure and hearing. He said that this was the type of discussion he would like to engage with.

Mr Williams said that this ought to have been a discussion on a Committee Bill. A Committee Bill would not even mention the power of the NCR and would be focused on indigent people and the relief of debt that these people were under. He said that today the NCR powers were not relevant to the briefing the Committee asked for.

Adv Van der Merwe, Senior Legal Advisor for Parliament, was called upon by the Chairperson for clarification. Adv Van der Merwe said that the initial focus of the Committee Bill was to find somewhat of an interim solution to relieve those people that were most crippled by debt. She said that there was review of the NCA which the Department was embarking on which looked at the powers and constitution of the tribunal and that such a review was on for the long term. She said that the main concern of the Committee was right now and the people affected by debt crises. She said that the brief to the NCT may have been broad but what the Committee was looking for was a brief on debt relief measures and issues also relating to reckless lending which would be dealt with in the Committee Bill.

The Chairperson said that the reason why the Committee had not waited for the Department to prepare a Bill was because that process could take up to two years or more whereas what the Committee was looking for was something that it could expedite and deal with. She said that notwithstanding that, there was a need in future that the NCT be invited to discuss other matters as mention by Mr Williams and Mr Macpherson, it seemed that the current presentation was somewhat a fruitless expenditure of the delegation’s time since it was misdirected at the Committee and its objectives of what the briefing was called for.

Prof Maseko said that the reason for the misdirection was perhaps that when they received the brief there was no legislation attached to it, so the NCT assumed it was on the proposed amendment which was put into the presentation. He requested that the NCT be furnished with the Committee Bill at some point and said that they would respond to it.

The Chairperson explained that the Committee Bill did not exists yet and that they were hoping to get input into it from the NCT through the brief.

The meeting was adjourned.