Madam Chairperson, firstly, before I start I just have a few words to say to the hon McIntosh, who has now made his last speech. I want to say a few words of respect. Sir, we respect your unbelievable contribution to this House and to South African politics for the past five decades. I think all of us bow our heads to you for that and say thank you very much. [Applause.]
All of us know and would agree that access to credit in the economy is crucial for economic growth and success in our economy. That is a given.
The overall impact of this legislation will be - I think this is a good thing for South Africa, as I will explain in a minute -that there will be a slightly reduced access to credit for those South Africans who really cannot afford to access credit in the formal markets, but who, in many cases, have nonetheless been offered credit, sometimes recklessly, by credit providers, knowing full well that they cannot really afford it.
I think in that respect this piece of legislation is to be welcomed and that is by and large why the DA supports it.
Much has been said about the quality of South Africa's credit legislation and credit regulatory regime, and I don't think that bears repeating.
However, let's make this clear: If people want credit and they cannot get it in the legal markets, they will try to get it elsewhere. If they cannot get it from a registered lender, they will go to an unregistered, illegal lender.
We all know that there are at least 10, if not more, illegal lenders for every legal lender in South Africa. Therefore we do have a massive problem in the illegal space.
Chairperson, we can have the best laws that we want - and this is a really good law - but unless we are ready to properly regulate, enforce and police that law, all that will happen is that the legal credit market will shrink and the illegal market will flourish.
We have to take very careful and special note of that. In this regard I cannot help but express my very sincere and severe doubts about the capacity of the National Credit Regulator to deal with the illegal industry.
I am very aware that Madam Regulator is with us in the House today. I don't mean to put her on the spot, because I know that she does the very best that she can with the resources that she has at hand.
The fact is that we cannot close the loopholes in the credit industry in the legal space and leave the illegal space to flourish as much as it wants. We have to make sure that illegal lenders are not allowed to operate and that we stamp that industry out as much as we possibly can, on the one hand, and on the other, that the legal lenders operate within the law and don't rip off consumers.
Too often we hear complaints about the National Credit Regulator, NCR, not answering correspondence, not honouring meetings and simply not taking adequate action against illegal lenders.
All of us - every one of us in our constituencies - know that there are dozens of illegal lenders advertising themselves openly on every street.
Why is it that the police do not take action against those lenders? Why is it that the NCR inspectors are not there on a daily and weekly basis to make sure that those lenders are reported and prosecuted to the fullest extent of the law?
Let me give you just one example of a debt counsellor, not a lender, who is in flagrant breach of the National Credit Act as it currently stands - and I don't care that I'm mentioning them by name because they are operating illegally.
There is a business called ADMS, a debt counselling service, and a member of the public wrote to me that ADMS has been charging this South African lady R1 600 a month for six years. However, not one cent of her principal debt has been paid off. No one can get hold of the company called ADMS. I reported this to the NCR on 5 May 2013, again in July, again in August and again in January 2014. On Monday I received their response saying that they could not find my earlier correspondence and that I please have to submit it again. [Interjections.]
This law is a good one, and I congratulate everyone involved in drafting it. But if we are going to write fantastic laws, we have to back them up with the ability to enforce them on the ground. [Applause.] Again I just want express my sincere concern about the ability of the NCR to be able to handle the illegal market.
I congratulate the committee on this piece of legislation. Thank you very much. [Applause.]