Rental Housing Amendment Bill [B56B-2013]: negotiating mandates

NCOP Public Services

17 March 2014
Chairperson: Mr M Sibande (ANC; Mpumalanga)
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Meeting Summary

The Department of Human Settlements (DHS) together with legal representatives from the Office of the State Law Advisor were invited to provide input to the negotiating mandates of the Committee on the Rental Housing Amendment Bill [B56B – 2013].

The following mandates were presented by the permanent provincial delegates; Eastern Cape, North West, KwaZulu Natal, Northern Cape, Free State and Mpumalanga. These provinces voted in favor of the Bill. The submission from Limpopo was not yet available for submission to the Committee during the meeting. The Western Cape did not comply with its Constitutional mandate of engaging communities in provincial legislative process through public hearings. The province argued that there was not enough time to hold public hearings. The Western Cape therefore voted against the Bill. The main concerns raised by the provinces through public hearings were around tribunals being given power to evict tenants.  The Constitution clearly stated that no one should be evicted without an order from the court. The tribunal was not a court and the original intent for the tribunals excluded powers to evict. The tribunals could only receive such matters and refer them to the relevant court to deal with. Other matters related to the issue relating to ‘landlords’ the matter was one which would be considered in due course, especially concerning gender. It has been proposed that ‘land owner’ be used in the place of ‘landlord’. Members also raised concerns around the timeframes and the appointment of members of the tribunals and these were taken into consideration.

Other concerns which arose from public hearings were; who would regulate annual escalation fees? How would the DHS address the issue of upfront payment of deposits amounting to 3 months? Were landowners going to register with the tribunals, if so, what would be the consequences of those landowners who did not? Would the tribunals have the capacity to solve problems between landowners and tenants? Would the DHS accommodate the formation of associations for tenants and/or associations for landlords; would the Bill make provisions for such platforms?

Provinces with outstanding mandates were given until Monday, 24 March 2014 to submit their complete negotiating mandates.
 

Meeting report

Chairpersons’ opening remarks
The Chairperson welcomed Members of the Committee to the meeting. The Committee had previously been given a task to go to provinces to discuss the Rental Housing Amendment Bill respectively. Each province present at the meeting was therefore requested to go through their submission.  The Department of Human Settlements (DHS) would then also present any amendments to the Committee, together with an opinion on the various submissions made by the provinces. The legal section would also be given an opportunity to comment on the submissions.

Eastern Cape
A Member said after the briefing from the DHS, the Eastern Cape held public hearings on the Amendment Bill. The following areas were covered; Mthatha, Queenstown, Port Elizabeth and East London. The province therefore mandates the National Council of Provinces (NCOP) to carry the proposal that whenever the words ‘tenant’ and ‘landlord’ appeared they would be replaced with ‘lessor’ and ‘lesser’. The word landlord as debated by the Committee was only representative of one gender, whereas the proposed terms were gender neutral; linked to that the province also proposed that the term ‘landlord’ should also be changed. The tribunals were also a concern, raised from the public hearings in Queenstown; the tribunals should be given powers to evict whenever there was a dispute which favored the property owner.

The Chairperson it needed to be a priority to give the Eastern Cape a permanent delegate to lead the process. Mr Mlenzane was asked to contribute to the submission.

Mr Z Mlenzane (COPE; Eastern Cape) apologized. He said the assumption was that when the Chairperson of the province would be the one to present the submission. He said he fully concurred with the report of the province.

North West
Mr H Groenewald (DA; North West) said the number of the Bill was incorrect; therefore the submission could not be tabled. He suggested that the Committee Secretary contact the North West and get the submission with the proper numbering of the Bill.

Free State
Mr M Jacobs (ANC; Free State) said the province voted in favor of the Bill.

Mpumalanga
Ms M Themba (ANC; Mpumalanga) said after deliberating on the Bill, the province conducted public hearings in three regions and after these hearings the Committee request that the permanent delegate of Mpumalanga to vote in favor of the Bill.

Limpopo
Ms L Mabija (ANC; Limpopo) said the Limpopo document was not yet ready for Members but it would be presented to Members shortly. The province had however gone through the public hearings.

Western Cape
The Chairperson said the Western Cape responded that they were not supporting the Bill.

KwaZulu Natal
The Chairperson said KwaZulu Natal supported the Bill provided that the proposed amendments were considered and consolidated in the Bill.

Northern Cape
The Chairperson said the province was in favor of the Bill, and amendments were attached to their submission.

Discussion
Mr Kwezi Ngwenya, Legal Advisor, DHS said the concern raised by the Eastern Cape around the tribunals being given powers to evict would be a constitutional issue which would not be considered on the basis that the Constitution clearly stated that no one should be evicted without an order from the court. The tribunal was not a court and the original intent for the tribunals excluded powers to evict. The tribunals could only receive such matters and refer them to the relevant court to deal with. With regards to the issue relating to ‘landlords’ the matter was one which would be considered in due course, especially because gender-sensitivity also needed to be taken into consideration. It has been proposed that ‘land owner’ be used in the place of ‘landlord’. However, this was not a legal matter but a matter of preference. He said the DHS was making provision to the number of members each tribunal would have; in response to the concern raised by the KwaZulu Natal submission. Other reference was made that the tribunal would consist of seven permanent members appointed by the MEC.

He said the DHS had an opportunity to brief the Western Cape the previous day (17 March 2014) and the department was welcomed by the province. However the province was not supporting the Bill because it was not given enough time to consult to the satisfaction of their responsibilities to the province. He said the DHS had taken note to the North West’s concern around the correction of the numbering of the Bill and this would be corrected accordingly. He said the public hearings in Free State were well attended. He said the DHS had taken note of the concerns raised around the timeframes and the appointment of members of the tribunals and these were taken into consideration. The Bill made provision that the MEC needed to establish a tribunal within the financial year. Rental Housing Tribunals would be established in all nine provinces; these provinces would be compelled to not waste any time in these appointments.

The Chairperson asked what comments the DHS had on Mpumalanga.

Mr Ngwenya apologized. Mpumalanga supported the Bill and the DHS had an opportunity to brief the province on the Bill, and these discussions were robust and proactive. The issues which were expressed were also productive in nature. Public stakeholders were actively engaged.

Ms Bongiwe Lufundo, Principal State Law Advisor, Office of the Chief State Advisor responded to the submission by the Eastern Cape and agreed that the Constitution did not make provisions for the tribunals to evict; the court of law was the only body with powers to evict. On the substitution on ‘tenant’ and ‘landlord’ a proposal was made that ‘land owner’ be used instead of ‘landlord’. On the negotiating mandates of the Northern Cape, she said the timeframe of the term of office of an individual within the tribunal was three years subject to re-appointment. This was a timeframe provided in the Act. KwaZulu Natal proposed that the tribunal consist of seven members. She responded that the intention of the tribunal was that they sit as two committees, with three members on each committee. Seven members would cater for big tribunals such as the Western Cape and Gauteng.

Advocate Ntuthuzelo Vanara said Section 118 of the Constitution required provincial legislatures to involve the public in the business of the legislature. The observation was that in respect of these negotiating mandates submitted to the Committee, there has been compliance with that legal obligation. However as indicated, due to time constraints the Western Cape did not facilitate public involvement. He said not all proposals raised legal opinion, most of the submissions raised policy issues. For example the proposal from KwaZulu Natal around the number of people who could serve of the tribunal was not a legal issue but a policy matter for the Committee to consider taking into account what the Committee would want the tribunal to do. He responded to the submission by the Eastern Cape Provincial Legislature and agreed that the issue of tribunal being given the power to evict was reserved for a court of law. It would therefore be improper with the Constitution for the tribunal to be given such powers by a national legislature. On ‘landlord’ and ‘land owner’ he said this was an issue of preference however a valid argument around gender sensitivity was welcomed. However this was not a legal issue. On ‘landlord’ and ‘tenant’ being substituted for ‘lessor’ and ‘lessee’ he said it would make sense for the Committee to consider the suggested amendment, particularly in view of the sensitivity with the use of ‘landlord’. On the Northern Cape’s submission he advised that it would not be necessary for the regulations to rehash what was already provided for in the Act.

With the Western Cape’s mandate he said the province did not comply with the Constitutional obligations due to time constraints in the facilitation of public involvement according to Section 118. This could therefore render the Bill Constitutionally defective. If the Bill would be passed it would be passed without the mandate from the Western Cape. Secondly, the Bill would be passed by those provinces supporting the Bill, who have compiled with their Constitutional mandate. He said the only item which he did not receive clarity from from the DHS was the issue of the alleged non-compliance with Section 9 of the Municipal Systems Act.

The Chairperson said there were some responses from the legal section as well as the DHS to the various submissions by the provinces. Members should therefore indicate whether they were pleased with these responses. As indicated, some of the matters raised through public hearings were policy matters rather than legal issues. He said all provinces responded that time was a challenge to holding public hearings, however all provinces complied with their Constitutional mandates except for the Western Cape. Why was this the case? 

Mr Mlenzane argued that it seemed as though there was opposition from the Western Cape in progressing with the Bill, however the Bill was already in progress regardless. He asked that the DHS further elaborate on its reasons given around why the Western Cape was not supporting the Bill; the explanation should be read out and should be understood from a legal perspective. He said he was very pleased with the manner in which the Eastern Cape presented its submission.

Mr Groenewald asked for clarity from the legal section on whether the submission from the North West could be tabled when the numbering was incorrect. In the original negotiating mandate the numbering was incorrect because it stated B56-2013 and not B56B-2013.   

The Chairperson responded and said the Committee Secretary would obtain a revised negotiating mandate from the North West, with the correct numbering, and circulate it to Members. The Chairperson requested that Parliament take the Committee through the procedure around issues of mandates so that the Committee could better understand the process.

Mr Jacobs said the mandate from the Eastern Cape suggested that tribunals be given powers to evict, however as previously stated, the Act did not allow for that. He asked that the Committee be informed about the powers which these tribunals would have. He said rental agreements would be made between the landowner and the tenant; how would the DHS ensure that the annual escalation fees were uniform? Who would regulate such fees? In most rental agreements, the tenant was required to pay an upfront 3 months deposit and township residents would not be able to afford this. How would the DHS be addressing this? Were landowners going to register with the tribunals, if so, what would be the consequences of those landowners who did not? He argued that municipalities were faced with many challenges; would the tribunals have the capacity to solve problems between landowners and tenants? Would the DHS accommodate the formation of associations for tenants and/or associations for landlords; would the Bill make provisions for such platforms?

The Chairperson asked that Members focus their questions on the mandates at hand in order to avoid a situation where the discussions were moving backwards. He reminded Members that some concerns raised by Members were issues of preference as previously stated.

Ms Themba said the mandate from the North West made mention of the Committee, and the province therefore sent through the incorrect mandate. However the submission from the North West did make mention that they supported the Bill. The province therefore needed to be reminded to follow the correct process of mandating through the permanent delegate in the Committee. The submission could therefore still be corrected. She suggested that a copy from another province be sent as a guide to the North West so that they could correct their submission. She asked why the DHS was requesting these tribunals to report to the National Assembly and not to the NCOP which dealt directly with the provinces. Select Committees were the ones which would be in a better position to relay information from the DHS to the public hearings.

The Chairperson thanked Members for their contributions.

Mr Ngwenya responded to the question around the Western Cape province. He referred to Section 94 of the Municipal Systems Act. The municipal manager’s forum of the Western Cape province referred to this particular provision saying they were concerned about unfunded mandates. This related to financial responsibilities. He assured Members that after extensive consultation with the South African Local Government Agency (SALGA), the DHS was mindful of satisfying the requirements of Section 94 to ensure that there was no financial obligation related to rental housing officers. Municipalities which would incur financial responsibility would have an opportunity to designate. Therefore intervention by the provincial department would be only to provide some assistance in the form of training to these designated individuals. He assured Members that Gauteng had already appointed 18 Rental Housing Commissioners, Limpopo has appointed 14 commissioners, North West has appointed over 10 commissioners. He replied that the functions of the tribunal were to deal with lease agreements; the Minister was in the process of drafting a standard lease agreement which would be accessible for use by all landowners and tenants. The intention of the legislation was to provide cheap and accessible dispute resolution mechanisms. The Bill would therefore provide a clear distinction between the obligations of the tenant and that of the landlord. He said the general approach was that the DHS report to Parliament’s both houses, however the DHS would consider the suggestion that the DHS report directly to the NCOP on matters concerning the Bill. With regard to matters concerning the deposit, he said a pro forma lease agreement should be drafted to ensure that the DHS would be providing protection to the tenants. Once a person paid, there should be proof of this. In practice the deposit was usually a verbal agreement between the landlord and the tenant and so the law of contract needed to be taken into consideration. Verbal arguments before the tribunal did not hold much weight. Extensive education was however necessary and the DHS would take it upon themselves to provide such information.

Advocate Lufundo made an addition to the question on the powers of tribunals and said these powers were outlined in Section 8 and Section 13 of the Act and dealt with matters such as unfair practice, deposits, changing of locks and damage to property, forced entry and intimidation among other matters. Clause 15F of the Bill addressed the question of deposits and uniformity. She said deposits would be set according t geographic region.

Advocate Vanara said the mandating procedure was a three week cycle which consisted of three kinds of mandates; negotiating mandates, final mandates and the voting mandate. Provinces had however raised various complaints around the process. Negotiating mandates could be signed by the Chairperson of the Portfolio Committee from the provincial legislature. However there was an issue around who would sign the voting mandate. According to the Act it could be interpreted that the House should sign the mandate. There was also an issue around the final and voting mandates; could the final mandate be used as a voting mandate as well, as this happened to be the practice. There were therefore challenges around compliance with the provisions and procures around the six week cycle of mandating. Some of the challenges were around financial costs for legislatures. The Gauteng plenary therefore delegated its functions to a particular Portfolio Committee around the issues of final mandates; whether this was legally accurate was still open for discussion. There was however debates underway around extending the time allocated to provinces for mandating or to amend the Act itself. He suggested that the final mandates serve as voting mandates.

The Chairperson reminded Members that Limpopo and the Western Cape did not object to the adoption of the Bill but simply requested more time for deliberations through public hearings.

Mr Mlenzane proposed that the Committee stick with the schedule with regards to finalizing the mandates. He suggested that the Committee Secretary wrote to the two outstanding provinces and indicate to them that they still had a chance to visit their respective communities before submitting their mandates.

Ms Mabija agreed with Mr Mlenzane that the schedule could not be changed. Rather the deadline for all outstanding items was Monday, 24 March 2014.

Ms Themba agreed about Monday. DHS needed go back to fix the numbering of the Bill.

The Chairperson accepted the proposal.

The meeting was adjourned.
 

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