Hon Chairperson, the ACDP supports the National Credit Amendment Bill, which will definitely change the whole landscape for credit retailers.
As the previous speaker has said, this is a very blessed committee. Unfortunately we were unable to participate in it. But it is interesting, as Romans 13:8 says:
Don't run up debts, except for the huge debt of love you owe each other.
So it's interesting that we are approaching this topic and we are considering the matter of debt.
I was very interested in the issue of prescription. I think that we, as MPs, really need to understand it. I will therefore spend the time available to me just to speak in support of the clause that relates to the banning, sale, collection or reactivation of debt that has been extinguished.
Now what does this mean? It is very important for us to understand it because, firstly, in terms of the Prescription Act - and each one of us should read that Act - debts will prescribe in 30 years in respect of any mortgage bond, any judgment debt, any debt in respect of taxation or any debt owed to the state; secondly, 15 years with regard to any loan that you take out to the state; thirdly, six years in respect of a debt, a bill of exchange; and finally, for most of the other types of debt it is three years.
This means that when you buy furniture or something else on credit, it will be a three-year period, which will run from that day.
Firstly, if you sign an acknowledgement-of-debt form on that first day, it will run for three years. After three years it is extinguished and it is finished. But then, if you are sent a letter of demand and you make one payment of R1 on that debt, the debt relives from that date. It is very important for us to understand that.
Secondly, if a summons is issued after that three-year period and you ignore the summons and you sit back and say that it is extinguished and it is finished, they can still take judgment against you.
You then have to go to court and plead in your documents that this debt has prescribed. It is very important for us to have an understanding of what happens when it comes to the acknowledgement of debt, if you make a payment or if a summons has been issued against you. Then we can tell our constituents about that.
I would suggest that many debts have been prescribed in this period of three years and that many people, because they don't know this, are intimidated into making a payment; or, when they receive a summons, they do not respond to it; or, in fact, they sign a new acknowledgement of debt. Then that three-year period starts running again.
So let's be wise and let's advise our constituents about this crucial aspect of prescription. We in the ACDP fully support this. It is unconscionable for people to sell debts on that have already prescribed and then put pressure on debtors to pay debts that have already prescribed. The ACDP supports the Bill. Thank you very much. [Applause.]