National Consumer Tribunal on credit abuses; DTI on inter-departmental coordination on credit abuses

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Trade, Industry and Competition

20 May 2016
Chairperson: Ms J Fubbs (ANC)
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Meeting Summary

The National Consumer Tribunal presented on debt rearrangement cases and other cases that it dealt with and how many were to referred by the National Credit Regulator (NCR) and National Consumer Commission (NCC). Also discussed were the filing requirements, staffing and the impact of an increased case load on their finances.

NCT experienced four main challenges - the increase in case load, management issues, procedural steps taken outside of NCT control and increased turnaround. They were, however, implementing various interventions to address these.

Members asked why the NCC had referred so few cases to the NCT; decision support systems and the qualifications of NCT members; whether consumers were given legal aid at the NCT, and whether matters were referred for criminal investigation if criminal acts were found. The holiday club matter was discussed with NCT and NCC.

The Department of Trade and Industry presentation dealt with the affordability assessment regulations, registration of credit providers with NCR, the capping of interest rates and fees which had been finalised and came into effect on 6 May 2016. On abuse in the credit life insurance sphere, DTI intended to propose an amendment to the National Credit Act to Cabinet which would give more powers to NCR to impose fines. DTI’s cooperation with Department of Justice to ensure related legislation was drafted and enacted in the form of the Prescription Amendment Bill, Debt Collectors Amendment Bill, Courts of Law Amendment Bill was presented. Also presented was the cooperation with the Department of Social Development on emolument attachment orders or garnishee orders and social grants as lobbied by Black Sash.

Members spoke about disability insurance being sold to those who were already disabled which was not yet addressed. There was also discussion on the difference in interest rates of lawyers and debt collectors for the same work. A suggestion was made that in the amendments, a new category should be added where repeated reckless or gross lending was considered a criminal offence.

Meeting report

The Chairperson noted that those committee members who were not going to attend a meeting had to inform the committee in writing. She commented that IFP was the only party who informed them if they were attending another committee meeting.

Mr D Macpherson (DA) asked for an amendment to the agenda. He wanted to have a quick discussion on the steel crisis that was unfolding rapidly in the country. He had a whole lot of documents he wanted to table with the Committee so that they could chart a way forward.

The Chairperson stated that they were dealing with steel in August. She said someone had brought this up two weeks prior about tariffs, commodity pricing and the cheap steel that was coming in from China. One was aware that the Minister had already attached tariffs to 10 lines to address that. About two or three weeks before, a committee member had alerted the Committee to this. They had spoken to the Minister on the matter. It should have addressed a number of issues.

Mr Macpherson stated that he did not think they could wait until August. The prices continued to increase unabated to downstream manufacturers, despite the Minister’s statement on 5 February 2016 that price increases would not take place, and despite an agreement being published in August that no price increases would take place. There had been four this year. ArcelorMittal continued to disregard the recommendations, the agreement and possibly even the instructions of the Minister, which was hugely concerning. He had written to the Minister a number of times and had not received a response. He had written to the International Trade Administration Commission (ITAC), asking them what their position was but they had not responded. They now had a crisis on their hands, where ArcelorMittal was increasing prices and companies were closing down because they could no longer continue on this footing. It was very important that they had this discussion, that he was allowed to table the documents and that they charted a way forward as to what would happen before Parliament rises on 27 May, because this had to be dealt with before they rise.

The Chairperson stated that she had asked for this to be dealt with before Parliament rises but everyone wanted constituency leave.

Mr G Hill-Lewis (DA) was unsure who wanted constituency leave, but it was not the DA. He supported the proposal. If they looked at the Quarterly Labour Force Survey released last week, in three months there had been more than 100 000 jobs lost in manufacturing, which included primary steel manufacture, as well as all the down-stream manufacturing that used steel. It was absolutely a huge crisis that could not wait until August, by which time it was possible that another 100 000 jobs could have been lost in the industry. He supported the proposal that the Committee briefly discussed it at this meeting, and add it to the agenda for urgent discussion with the Minister before Parliament rises.

The Chairperson stated that she was going to address this. At one point, both Mr Hill-Lewis and Mr Macpherson had not been present, when they had the opportunity to discuss this. When it suited them to be in Parliament, then there was time.

Mr B Mkongi (ANC) pointed out that the Chairperson did not agree with the proposal to add this to the agenda, saying the Committee had discussed this. The DA was now arguing the point, but it was not on the agenda. They were arguing and debating the point which was ill-disciplined. He did not want the Chairperson to look like a populist in this meeting. It was the ANC which had raised concerns about the steel issue in South Africa. They had colloquiums here speaking directly on the issue that the big steel industries were selling to downstream manufacturers in South Africa. The ANC had proposed developmental tariffs in terms of prices which was supposed to help downstream manufacturers. The DA voted against that. It rejected the 10%. Now they were coming into the Committee to grandstand and be populist on the matter. ANC told them a year ago, now they thought they were going to be masters of this information. It was now in the hands of the Minister and the Department of Trade and Industry (DTI). Perhaps if they propose to have a special meeting next week where they could brief the Committee on the crisis, that was possible but they could not put it on today’s agenda.

Mr Macpherson said that was what he had done.

Mr Mkongi said no, maybe Mr Macpherson did not know English, but he was white. Mr Macpherson had proposed to amend the agenda and the Chairperson told him that they could not amend the agenda because the issue was being processed. Mr Macpherson was contesting this. Maybe he, Mr Mkongi, was an African that knew English better than a white man.

The Chairperson told them not to go down that street. What she was saying, and Mr Mkongi was also not present, was the Management Committee had discussed what critical items they should put on the committee programme which were outstanding issues that could not wait until 16 August 2016. Mr Garth Strachan, DDG of Industrial Development at DTI, was presenting to the Committee on another issue the following week. The matter of steel had come up several times. On occasions Mr Macpherson had been there, and on occasions he had not. Something had been done. So she was not going to the hold a debate on the issue now. She requested someone propose the adoption of the agenda.

Mr Macpherson said with respect, that it was not the Chairperson’s unilateral decision to decide on the agenda. He suggested taking a vote.

Mr A Williams (ANC) moved for the adoption of the agenda. Mr M Kalako (ANC) seconded. The Chairperson recognised those who had objected.

Mr Macpherson said with respect, that this was a democracy. It was not for the Chairperson to decide what the agenda would be. This was a multi-party committee. It was not for her to decide how the committee should be run. It was for the Members to decide, and if they put something forward as a proposal it should be acknowledged.

The Chairperson requested Mr Mkongi to not run a dialogue. She said they would go over the programme for next week so that those who were away the previous week would be fully aware of what was on the agenda. Some of the changes that MANCO had made the day before to accommodate certain items was because Parliament was only coming back on 16 August 2016, which was why they had to change the programme.

Mr Hill-Lewis requested a letter in writing, of the dates which she alleged that Mr Macpherson and himself were not present because he could recall two meetings in the entire fifth Parliament, where Mr B Topham, their designated alternate had attended meetings because neither of them could be there, and neither of those meetings were recent. So he disputed the allegation made here publicly that there had been meetings where neither of the DA representatives had been present. So he requested those dates in writing.

The Chairperson stated that he was aware because they had turned down the desirability of his Bill and he left immediately thereafter. Mr Macpherson had not been there for an extended period of time with a valid apology. So he was aware and they did not need to debate things he was already aware of.

Mr Hill-Lewis requested the dates in writing.

The Chairperson said that she would not give the dates in writing because he knew he was not there. She wanted to move on to the briefing by the National Consumer Tribunal.

Mr Hill-Lewis was trying to be acknowledged but the Chairperson refused to recognise him. He stated that it was unacceptable for her to make allegations without substantiating them.

National Consumer Tribunal
Ms Diane Terblanche, Executive Chairperson of NCT, introduced Ms Marelize Bosch, the CEO of NCT, and two of the full times Tribunal Members, who were present because they directly overseeing the cases. Ms Hazel Devraj dealt with the matters that did not directly relate to debt rearrangement and Mr John Simpson dealt with debt rearrangement. Mr P Moodley was the Acting Registrar and Mr Bax Nomvete, the ICT and Records Manager, because of the ICT interventions that they brought to bear on their cases and their case management.

She commented on how the past year had been for the NCT. Overall, from NCT perspective, 2015/16 had been both challenging and rewarding. It had been rewarding because they had seen an increase in the numbers, types and the complexity of the cases filed with them. It showed that they were able to extend their services - adjudication to regulators and consumers. They had also been able to increase access to their services, through, for example, holding motion courts in different provinces for debt rearrangement matters. They had been able to link up with their parties via ICT to participate in their cases. They had been able to take up the increased mandate to NCR in terms of the National Credit Amendment Act (NCAA) that came into operation in March 2015.

They had also seen a development of their case management system, very importantly, in consultation with relevant filing partners. They had been able to test that in relevant testing fields before going live on their system with those relevant filing partners, and NCT was working with them to develop further modules. They had been able to harness and implement rule changes to the NCT rules that made it easier and cheaper for parties to access their services in how they could serve and file papers in the cases they brought to the NCT. In terms of their efficiencies, because they were no longer compelled to do assessments for complete filings on all matters, but only where there were cost implications. They had been able to increase the jurisdiction precedents and certainty on interpretation of consumer and credit legislation through their judgments and their judgments had been upheld on appeal in 11 out of 12 appeals.

They had regular strategic interventions with their filing parties. It enabled NCT to be more responsive to concerns about NCT service delivery of which had quite a few had been raised during the past year. These were brought forward by the NCR and other filing parties and NCT had been able to engage and interact with them and remedy the situation to some extent, even thought at this point not fully. They had also seen parties exercising their rights in terms of the South African Constitution, the Promotion of Administrative Justice Act, the National Credit Act, for the NCT to ensure that it was fair in its adjudication of these matters. They had managed to operate within their allocated budget because of interventions they had put into place, mainly with ICT, scheduling of cases, scheduling cases per NCT Members as well as maintaining a clean administration and a clean audit for the third year in a row. There were no internal or external audit findings over the past year, which was quite a feat in terms of the increase in their cases.

Debt rearrangement issues had increased at a tremendous pace. It was an indication of the economic situation in South Africa, that consumers were extremely debt stressed, and also because of the increased uptake of their services. On matters that did not involve debt rearrangement, such as prohibited conduct matters, they had definitely seen an increase in the number and complexity. This related to the NCR’s aggressive uptake of its increased mandate to prosecute, for example, reckless credit matters and illegal charges to consumers. There were also quite a number of cases before the NCT by unrepresented parties, in fact, the largest portion of matters before NCT, were matters referred to them by consumers directly, and by regulated entities such as debt counsellors.

Ms Marelize Bosch, CEO of NCT, explained the acronyms the presentation used. When cases were allocated, it was to give a matter, depending on the type of matter, to either a single member or a three member Tribunal panel for a hearing and the requirements for the hearing were in the National Credit Act (NCA). Close of pleadings signalled to parties that the set period of time for parties to file their answering and replying affidavits had ended and the matter was ready for hearing.

Another important term used often was a DRA – a Debt Rearrangement Action. These were applications brought by debt counsellors to rearrange a consumer’s credit agreement obligations. When looking at their own environment, the majority of the increase had been related to these kinds of actions. Even though there was agreement between the debt counsellor and the consumer on the debt obligations of the consumer, it was still important for the NCT to interrogate these matters. These matters may contain illegal interest rate, instances where consumers did not agree to what was put forward, amounts may be in excess of what the consumer could afford, for example not all the credit providers had consented to the agreement put forward by the debt rearrangement application. It was important that there had to be consent between all the parties, if not, the NCT did not have jurisdiction to look at the debt rearrangement and it then had to go to a court.

Non-debt rearrangement application was a term used to refer to all matters that could be filed at the NCT, excluding debt rearrangement applications. It was a big grouping, where all matters that had to be heard by the NCT required a hearing. In most instances this would be a three member Tribunal panel and it required a formal hearing.

She listed some examples of the approximately 53 Prohibited Conduct types and 34 applications in terms of the NCA. These would be referrals by regulators, as well as consumers who could go to NCT directly to resolve sale of goods disputes or where they had been to the NCR and the NCR was not taking the matter forward. It also included the approximately 99 prohibited conduct applications that could be filed in terms of the NCA. Some of the matters considered were quality of services and goods, warranties offered on repaired goods. These matters were often quite complex and involved new legislation and without current guiding principles. Most of the work done by NCT on NCA came from matters referred directly to them by consumers who had received non-referral notices.

Looking at the filing parties for non-debt rearranging cases specifically, NCT had received 55 files from NCR, 1 from NCC, upping their filings with NCT to 2 cases, and then from other parties they had received 137 cases 2015/16. When she spoke about other filing companies, these were the dominant part of their filers and they were often unrepresented consumers. She would go back to the specific delays experienced in their cases, but in essence, their case load had increased quite a bit. During the previous financial year, they had approximately 800 cases per month. That had doubled to almost 1600 during 2015/16. They had addressed this though driving their setdowns aggressively forward, through setting up motion courts, looking at process changes. They had also had some teething issues with their case management system which led to them having to relook at case management processes and some reprogramming of the system.

Some of the other issues they had experienced in 2015/16 were interactions with their filing parties on where they had differences about implementation or about how to do some of the assessments for the filing requirements; most of which had been resolved. They had some issues with their reporting. Looking at the KPIs that NCT set for itself, the question could be asked how they came about those KPIs in relation to their turnarounds. At the initial establishment of the NCT, they had conducted benchmarking, specifically Australia and New Zealand. It was found that these regulatory bodies dealt with a wide range of matters, for example both competition and consumer matters. There were no entities that were specifically similar to the NCT that they could identify with which to determine a benchmark. NCT accordingly, in relation to turnarounds and what they deem to be acceptable turnarounds, set their own KPIs with the provision that they would improve on these turnarounds. Over the years, their KPIs remained quite stable but that had taken into account the significant increase in the number of cases. So they had to run faster to remain in the same place. Going forward they would be doing more research to see if more recently there were new entities that they could benchmark against. They were also considering a peer review.

The next slide represented the NCT over the past three years or so. The dark blue line represented their case load, and one could see there had been a steep increase in the number of cases before the NCT. The bottom three lines represented the staff structure, NCT members and financial resources, which had remained stable. Specifically looking at 2015/16, they had received 19 097 cases, which was a 99.16%increase from the 9589 cases received in 2014/15. Over a three year period, the NCT workload had almost quadrupled. Their financial resources had increased by 12.93% on average year-on-year over the same period. Their staff complement had increased from 38 to 41 employees and the NCT members had increased from 11 to 13 with the employment of the full time NCT members.

Looking at NCT current staffing, the male-female composition of the staffing was 62% female and 38% male. In terms of employment equity, it was 69% African, 3% Coloured, 12.5% Indian and 15.5% White. When looking at future staffing and the challenges NCT would be facing, it becomes quite evident, with the case load increase, they would have to consider getting additional resources. At this stage, they were not yet certain if it would have to be full time as opposed to contract resources. They were still establishing where they would have to go with regards to resources. It was however, necessary because the strain being placed on the staff was quite severe which could eventually result in staffing complaints. What they would be doing was to review their human resources practices within NCT. They had established a staff quorum and continual engagements with staff, so in the interim they could try to manage these types of problems. They had consulted with DTI and they were considering possibly getting retired judges on board as additional part time NCT members to help with the adjudication side of matters.

Looking at financial resources and the costs involved in adjudicating the matters; a DRA, only looking a NCT member fees, cost R172 per matter. That was usually where one NCT member would deal with the DRA. In terms of the current arrangements, a member could do 32 of these in a day. The non-debt rearrangement matters were more expensive and resource intensive, it also took a longer period of time to deal with them. Ordinarily there were three members on a case. The cost, solely on NCT member fees, was about R38 533. This was for seven days, because it was three members who would hear the matter and one member that finalised the decision. The cost of one non-debt rearrangement matter equated to 224 debt rearrangement matters in terms of fees.

The parties who could appear before NCT were regulators, consumers, service providers and registrants in terms of the Act. Looking at the 19 097 cases received during 2015/16, these were broken down into 18 901 DRAs, 193 non-DRAs and 3 other. Other cases would be where a party had filed an enquiry that had not been resolved. The NCT would refer them to the Regulator. Looking at the specifics, per filing matter, the biggest group of filers was other filing parties which was 137 matters, NCR with 55 cases and NCC with 1. These were specifically filed during 2015/16. If that was broken down into the relevant Acts; 168 applications were in terms of the NCA, 24 in terms of the Consumer Protection Act (CPA) and 1 in terms of the NCT Rules. It was important to see these were matters that were non-referrals that were filed directly with the NCT. Those would be instances when they would have gone to the Regulator, received their letter of non-referral and gone directly to NCT. From a time and resource perspective, these cases could be quite intensive. The consumers were not always represented so the NCT had to assist them in filing and bringing the right documents and at the hearing assisting them to put their case forward.

Currently the NCT had 11 091 matters that were not yet finalised or were pending. Of those, 10 935, which were mainly DRAs, were considered a backlog, which was largely due to inaccurate information flows which they had addressed through increased executive oversight and disciplinary action. Of that 10 935 DRA backlog, 1 187 of those were filed prior to 2015/16. They requested debt counsellors to verify with NCT in relation to these matters, on which ones they still required orders. What they had seen in the motions courts in some instances, was they had matters but the consumer has withdrawn from the debt review process. So NCT was verifying their older numbers so that they focused on those matters that actually required orders. Looking at the 156 non-DRA matters, 31 of them were filed before 2015/16,115 filed during 2015/16 and 10 filed after 2015/16, so those were the 10 newest matters from 1 April 2016 onwards. Ms Bosch gave a breakdown of these matters and the reason for delay such as being held over for a high court decision.

NCT regarded a matter as incomplete if all the documents required had not been filed in terms of the filing requirements. What often happened, especially with unrepresented consumers applications, they would try a few times to meet the filing requirements. So they would file, NCT would assess the filing and explain to them what the issues were as they only give some of the documents required. They went through that process with them until the consumer had all the necessary documents for the filing to be completed.

In relation to turnaround on those 31 matters filed before 2015/16, whether they were being held over because of the high court decision or not, turnaround was 543 days from filing, 478 days from close of pleadings. Excluding matters that were standing still beyond the control of the NCT, that turnaround improved to 381 days from filing and 242 days from close of pleadings. Looking at DRAs that had been filed before 2015/16, the figure she had there was 279 days from filing, however, this was subject to their verification exercise.

During 2015/16, NCT issued 10 826 orders on DRA applications. The majority of these had gone through the motion courts with great success. What they also changed in terms of their process, where previously they used to assess DRAs for their filing requirements outside of the adjudication process, they had now moved that together into one process. As a result of the motions courts and their other interventions, their turnaround in dealing with these matters, improved more than 85 days to 56.45 days. Overall for 2015/16, their turnaround in dealing with DRAs was 73 days. What they had to do here, because they had made changes to their process, is request DTI to make some amendments to their KPIs on these matters.

They received positive feedback from filing parties in relation to the motion court. They indicated that a lot of the service delivery issues encountered had been cleared because of this process. Looking at the finalised non-DRA applications during 2015/16, they finalised 132 matters. Of those, 76 were filed during 2015/16 and 56 were filed before 2015/16. How exactly they were finalised - 48.5% were finalised due to lapsing, these were matters that even after they had assessed them against the filing requirements and provided the relevant notices to the filing parties, they did not provide all the necessary documents to make them ready for adjudication. 15% of the matters were withdrawn by the parties,1.5% condonation was refused (this was where a party applied to the NCT to file their application outside the permitted time set out in the NCA). There were 2 settlements confirmed which was 1.5%. On 3.5% of the matters, the NCT issued judgments. After 2015/16, a further matter finalised.

Specifically looking at the NCRs cases, NCT had 79 current cases that were not yet finalised, that were lodged by the regulator. They had finalised 24 of NCR’s matters in 2015/16 and finalised 1 post 2015/16. Looking at the current matters, being 79, 26 of them pre date 2015/16, 51 were filed during 2015/16 and 2 were filed after 2015/16. Looking at the matters filed before 2015/16, one of them was undergoing a condonation process, 9 were in for withdrawals, 3 were in the set down process, 1 was postponed at a hearing and 7 were being held in abeyance due to high court applications or appointments of liquidators. Those were obviously matters that they could not move forward, and in 5 matters there were judgments outstanding. It included a judgment on a point of law.

She then analysed the 26 matters from pre 2015/16: 10 matters were filed in 2012/13, these were matters that the NCT could not move forward. 10 matters were filed during 2013/14, of those there were 5 matters that could not be moved forward due to high court applications, and of the other 5, 2 had been set down, 1 judgement, 1 pre-hearing and 1 ruling on a point of law. 6 matters were filed during 2014/15, 1 was held in abeyance due to a high court application, 1 was in a condonation process, 1 matter set down for hearing, 1 matter postponed at a hearing and 2 judgments outstanding. Next were matters filed within 2015/16 and where they were in the relevant processes. As could be noted, the majority of the cases were from the stage where the pleadings had closed and they could now allocate them for a hearing and they had been set down with hearing dates.

37 of the current matters filed in 2015/16 were filed by NCR, were filed during quarter 4. Looking at the 24 matters that NCT had finalised for NCR during 2015/16, the average turnaround time had been 186.48 days and 232 days from date of filing. In this turnaround, she had included all the NCR cases, regardless of whether there were postponements or condonations. After April there were two NCR settlements confirmed.

Looking at the average on NCR cases, NCT average turnaround on NCR cases, with postponements, condonations or matters being held over due to high court applications, was 35 days from filing and 12.25 days from close of pleadings. This was 29 of NCR matters, and all these matters were filed between February 2016 and April 2016. She had inserted a slide to show NCT’s normal case process. This was where everyone in the process did exactly what they were supposed to within the relevant times from filing to the day of judgment, it was estimated to take about 175 days. If there was an interlocutory application, for example a condonation, that would add an additional 65 days to that process per application. This would mean, for example, if respondent filed his documents late and there needed to be a condonation process that was 65 days, the other party may require papers, that would add another number of days to an application. It was relevant because, when she looked at matters affected by postponements, condonations, being held over due to high court applications, or awaiting withdrawals, which were 50 of the 79 matters, that turnaround went to 358 days from filing and 289 days from close of pleadings. Excluding matters that had to be withdrawn, it was then 256 days where there were postponements, condonations or matters held over due to high court applications, and 174 days from close of pleadings, which were 41 of the 50 matters.

2015/16 was very challenging for NCT. They experienced 4 main challenges. Firstly, their case load had all but exploded, they had serious management issues in dealing with their cases, there were a number of cases where parties took procedural steps which were outside of NCT control which of course increased turnarounds and they did not set down matters quick enough which could be evidenced by their underspend in NCT member fees. There were some delays in judgement reviews and issuing. In some instances they had done an inaccurate assessment of their non-DRAs. In other instances they had long delays in assessing their DRAs. They implemented a new system this year where they had some teething issues and user adoption issues with implementation. All of the factors combined resulted in the NCT struggling to attain and sustain their expected levels of service delivery. If their case load continues to increase as it had done over the past three years, it may ultimately jeopardise the NCT achieving its targets set in the Annual Performance Plan.

They were, however, addressing the challenges. Speaking of the upsurge in case load, specifically impact on budget, they had addressed this by increasing the number of DRA cases the NCT members dealt with in a day. They were currently on 32, that had gone up. They had started at 1 per day, to 8 per day and now at 32 per day. They distributed their cases filed using remote desktop services and motion courts. They had a number of ICT interventions put in place to help reduce cost. In relation to non-DRA matters, where possible, they set down more than 1 matter a day. They could set down 3 matters per day, if they estimated that they could deal with a matter within a few hours.

Looking at the impact their case load has had on expeditious and accessible adjudication, then they had continuous motion courts, request for additional NCT members, reconsidering staffing structures to include additional administrative personnel so that they could have, for example, more motion courts simultaneously in more venues and then ICT interventions.

To continuously address the challenges they would be facing due to their case load, they would have to look at additional human resources such as additional administrative personnel and NCT members. This would also be necessary to reduce the strain experienced by current staff and NCT members as a result of demand for services exceeding their capacity.

They experienced serious management issues. They had taken two main steps. On the one hand, they had taken disciplinary action which was still currently ongoing. On the other hand, they had enhanced oversight over the management of their cases, which would continue in conjunction with the Acting Registrar until the finalisation of the disciplinary processes.

With regards to the challenge of parties taking procedural steps outside of NCT control, the NCT had to act in accordance with the principles of natural justice and as such the challenge was unavoidable. However, what they did do, was each one of these applications were considered by the NCT to ensure that only those applications with merit were allowed to proceed so as not to cause unnecessary delays.

They had a number of case management challenges. They were addressing this through enhanced oversight over case management steps, continuous training of employees on case processes, additional resources to reduce strain on employees, regular interaction with stakeholders and placing greater emphasis on change management in implementing additions to their case management system.

The next slide was a picture of South Africa, showing where the NCT had had some of their motion courts to date. They would be going to all the provinces with the motion courts. This was just to show where they had been since they started the intervention. Going forward, at least 2 weeks out of every month they would be having motion courts.

A highlight for NCT was that the high quality if its decisions had been retained despite the upscale in case load. Of the 11 appeals/reviews filed to date, in only 1 instance was this overturned at the onset of the adjudicative mandate. They were recently in March 2016 upheld in the High Court. They also participated in the African Dialogue Forum, a regional forum for all African countries. The NCT was going to be hosting the 2016 international conference.

In relation to the budget, NCT’s previous presentation before the committee in April, the CFO had gone through the budget slides. They had added them to this presentation for the sake of completeness, but she was not going to go into this in detail. Suffice to say that the intervention that had been put in place, meant their financial resources for 2016/17 and 2017/18 should be sufficient despite the current increase in case load. It was to be noted though, that if the case load increased again, they then would experience difficulties achieving their mandate with their allocated resources.

As a last note, their judgments were available on their website and on SAFLII with their contact details.

The Chairperson asked if someone from NCT had tested the website and whether there were problems.

Ms Bosch answered that they were reviewing their website but that was a continuous thing that they did.

Ms Terblanche referred to the slide on 358 days for matters where there were postponements and so on. That was an average across all the cases. There were cases with a much longer turnaround within the matters that they dealt with for the NCR. The problem with average turnaround, there were some cases which could pull the figure down. She just wanted to look at those quickly and give the committee an idea of which of those cases were the ones that had taken a long time and what NCT was doing about that.

Ms Bosch said in that the problem with an average turnaround, in some instances these cases could really pull the figures down. On the nine matters awaiting withdrawal, turnaround from date of filing was 820 days, from close of pleadings was 803 days. She had excluded them when she recast those figures. Looking at matters affected by condonation, turnaround was 154 days from filing and 58 from close of pleadings. Matters affected by condonation and amendment of papers were 412 from close of filings and 27 days from close of pleadings. Matters that were held in abeyance due to high court, turnaround was 447 days from filing, 430 days from close of pleadings. Matters which had been affected by postponements and amendments, turnaround was 224 days from filing, and 29 days from close of pleadings.

There were two specific cases that had a very long turnaround which were due to NCT shortcomings within their case process. One of these matters came from 2012/13, which when they did the carry over from the previous year, somehow it fell off their carry forward figure, so there was quite a long delay with this case, until they received a query about it and then they realised they had this file that had not been through the process. Another matter was where they had requested parties to file additional documents, which they did, but the file was never really dealt with after that.

The Chairperson asked whether that was confidential or whether she could share that with the Committee.

Ms Terblanche stated that they had a detailed report which they had shared with the NCR. It contained the details of the cases. It was not really confidential, it contained more the operational side of the cases.

The Chairperson said that they had taken such a long time and maybe those involved had complained.

Ms Bosch said the one matter was the Hewitt matter, which was the deregistration of a debt counsellor, and the other matter was a deregistration of a credit provider,  Forum SA Trading.

Ms Terblanche added that these were matters referred to NCT by NCR which alerted them to the problem in the carry through of the cases. They met with NCR regularly and NCR alerted them to specific issues that they had with the cases they handled, and this came out of those discussions. The inaccurate assessments, which also extended the life of some cases unacceptably, related to a disagreement they had over what constituted a complete filing. The NCR had filed papers with pages missing and there were pages that were illegible therefore NCT rendered it incomplete. They had discussions with NCR which said legible documentation was not an issue for complete filing. They then came to an agreement that they would exclude those papers for the parties’ consideration during the adjudication process. Those matters, as a result, were only rendered complete almost eight months after they were initially filed.

Mr MacDonald Netshitenzhe, DTI Chief Director of Policy and Legislation: Consumer and Corporate Regulation Directorate, said whenever they spoke about regulations, sometimes those included NCT Rules in order for the matters to be dealt with speedily. He encouraged education and awareness by practitioners so that matters were not delayed or thrown out due to not knowing rules that had been amended.

The Chairperson thanked all the presenters. This was an important issue which came up often so they needed to dig deep.

Mr Hill-Lewis thanked NCT. He completely understood the serious constraints that they worked under and the huge explosion in the case load they were working with, but they also needed to understand their extreme frustration where there were examples of consumers being persistently ripped off on a daily basis and had no one to protect them. They did not have the ability to go to court as it was far too expensive and the NCT was the body that was supposed to act as the people’s protector. It had taken literally years for NCT to hear some cases, and he was not referring to DRA cases. He was talking about industry wide, almost class action cases. When it took years for those to be heard, people were left vulnerable.

What the Committee had already asked for, and he understood there were a lot of cases, but they had originally asked for a detailed break-down of the bigger cases that the Committee had been enquiring about for a long time. For example, the holiday club cases and the big NCR cases against African Bank, Lewis and some other furniture retailers.

The second thing was, their website was last updated in August 2014 so the cases, judgements and practice notes on those cases were old, and he presumed they had done a lot since August 2014.They were not available on the NCT website.

His last question was directed at National Consumer Commission (NCC) because he found it strange that only one case had been referred by the NCC in the last financial year. The Committee had raised what seemed like a very serious erosion or degradation of the role of the NCC in protecting consumers and enforcing the National Credit Act. Now here again was more evidence of that with only one case referred in the entire year. So he wanted an explanation of that from the NCC directly.

Mr Williams referred to slide 38 on ICT interventions. He wanted to know what exactly the decision support service was.

Mr Koornhoff (ANC) asked how many permanent NCT members there were and whether they were qualified, and if qualified, whether they were legally qualified. He also asked how many temporary members there were, and whether NCT outsourced when they were in trouble with legal entities, to assist with backlog.

On slide 35 where they said they had serious management issues, could they unpack that and explain what issues there were? On the next slide they spoke about set downs not done evidenced by underspending on NCT members fees. He did not understand and wanted them to explain the underspend on NCT members fees. Whose responsibility was it to set down, was it the NCT Member or management?

Mr Macpherson thanked them for the presentation. He was fascinated by slide 21 that spoke to a number of non-referral applications by consumers. He hesitated to guess that a number of those people had been duped into agreements that they either did not understand from the beginning or which now simply could not afford. These people were probably from the lower end of the income scale and did not have the resources to defend themselves against well-resourced lending companies. What legal assistance was provided to them and were they able to apply for legal aid in defence of their application? He assumed that the defendant, the lender, came with some heavy hitting lawyers to defend their case, and the man on the street could not speak the legal jargon to defend his case. He asked what assistance NCT provided them, and if they could not, could people apply for legal aid?

With respect to Mr Hill-Lewis’s first point about the information required on cases required, that meeting was held in the Good Hope Chamber, and the question was directed at the NCR. They were asked to furnish the committee with all the cases, by name and case number, and criminal cases that may have been opened. He asked how many of the cases they dealt with were referred for further criminal investigation if criminal acts were found. If one was breaking the law, surely one had to be forwarded on to the police for further investigation.

With respect to the enormous turnaround time that the cases took, 358 days were mentioned, with postponements. In their opinion if they could give it, was this a deliberate attempt by the defendants to prolong the case for as long as possible, hoping it would be struck from the roll, and what was the NCT able to do to mitigate that or were they at the mercy of the process unfolding.

The Chairperson stated that the NCT had had an explosion of cases in the past few years, which presumably was a combination of awareness of their structure and some of the work they were doing. She asked whether they could explain how they were able to handle this explosion on the resources allocated. How was this possible since they had not made any dramatic increases in human resources or finances. With respect to the point that they had been alerted to a particular case by NCR. The NCR, in speaking about some of the challenges they had, had mentioned the length of time the NCT sometimes took. The Chairperson wanted a comment from the NCR CEO on the matter.

The third thing was regarding the fact that one was expecting cases to be quicker and cheaper which was why NCT was established, so South Africans did not have to rush to the courts. Now with the NCT having the challenges alluded to, could they indicate the measures with respect to ICT, because they suggested that they were going to put a new one in? She had experienced, in the public and private sector, that the introduction of a new ICT architecture really put a strain on things. 

Ms Bosch answered about the frustrations experienced, that they acknowledged that they also had issues, as she had indicated, there had been a number of factors that had compounded them, but they were dealing with it and focusing on managing cases so as to not experience these types of issues again within the constraints that they operated. What they had done was take these lessons and plan ahead when they thought their case load was going to increase, but even in their wildest dreams they did not expect this increase. They did have a handle on it now.

On the big matters referred to, what could be told about the Holiday Club matter, was that it had been withdrawn from the NCT. The other matter filed by NCC, was the Equal Trust matter, and on that a condonation judgment was issued, which specifically dealt with service. In that specific matter, the issues that the parties had to deal with, service on all the affected parties. That was the aspect they were dealing with in that matter.

In relation to the Lewis matter, that matter had been set down for hearing, so they had a hearing date. The other matter, the more recently filed one, the pleadings had closed so now it was at a stage where it had to be allocated to a NCT panel for a hearing.

The Nedbank matter referred by NCR, and the Shoprite matter, both were set down for pre-hearing in July. For the big matters, normally senior counsel was involved and quite big legal teams. So in order to get dates which suited all the people involved so as not to have an unnecessary postponement, could become quite challenging. From a case management perspective, they could deal with these matters more easily if they first had a prehearing where the parties could agree on what the issues would be from a process perspective.

For the big ABSA matter, it was set down for November. For Capitec, there was currently a condonation being adjudicated on. On FinBond, there was a prehearing today, and they would discuss matters of confidentiality and so forth. The UBond matter was withdrawn yesterday. She asked whether there was another big one that she needed to respond to.

In response to Mr Macpherson raising the 699 car deals, Ms Bosch said that that was the ABSA matter set down for November.

Mr Hill Lewis said the Holiday Club matter had been withdrawn because of confusion around service of papers on the respondents. He was appalled to hear that it still had not been re-filed. He asked whether there had been no filing in that case whatsoever and why that was, if they could hear from the other parties?

The Chairperson stated that this issue had come up before. She thought that that was also timeshare, because it had been referred in a letter to her as ‘timeshare’.

Mr Hill-Lewis asked why the UBank matter had been withdrawn.

Ms Bosch answered that UBank had been withdrawn the day before because it had been settled. The Holiday Club matter had not been filed in the NCT again. On the necessary update of the website, they were going to get onto that soon. In the meantime, if any person wanted to get the orders, they were also published on SAFLII website, and there they were quite up to date. The decision support system was an enhancement that they were currently considering for their case management system.

Ms Thezi Mabuza, Deputy Commissioner of the NCC, spoke about the holiday club matter. In terms of the timeshare, they had withdrawn both the cases that they had filed with the NCT because they were found wanting in terms of procedure. The reason they had not filed as of now was because the practice was continuing, they could not go back to the very same cases that they had presented. So they had to file on new matters. They were busy with those matters now. They re-issued old investigation notices to all parties and based on the lessons learned, they were trying to do it better, by serving individually. They looked at the practices individually. They would be doing this in the course of the financial year as they were busy now, and once they had approved investigations, they would continue.

On the number of cases the NCC was filing, Ms Mabuza said that it was not that all the matters they filed were going to end up at the NCT. If during the investigation, when they served the investigation report back to the respondent, they might get an agreement, especially if it was a reactive complaint within a space or practice, where the respondent was willing to settle or perhaps give the consumer the recourse they wanted. In most cases, if it was not continuous, but just a once-off matter, they may settle on the matter and there would be no need to proceed to NCT. Due to the filing requirements that had changed in September 2015, the investigation was based on a process, on the understanding of the filing requirements. All the cases that had been ready by then, NCC had to hold back in order to cure the inadequacy with the matters. So when legislation or rules changed, there had to be education. They had to go and re-educate themselves, so that they did not find themselves going back and having to throw them out. Then with the help of NCT, the NCC could be asked these questions by September 2016, to see if there were no changes or if they had cured the weaknesses experienced.

Ms Bosch went back to the decision support system. They were looking at enhancements to their case management system, to assist with some of the factual checks in terms of DRAs, because that was the bulk filing matters. She was referring to, for example, an interest rate, above or below limits set for that type of agreement. If credit agreements worked out as set forth in a proposal, whether that proposal would still be, from an age perspective, mean the consumer would have to work until 110 to repay what he had put forward in a specific debt rearrangement. Those were the factual checks that needed to be done. They were looking at ICT to see how it could assist them so when they adjudicated on matters, they had an alert to tell them that in a specific matter they had to look at the age of the consumer, what was put forward and if the consumer would have to pay more. This was what the decision support would be about.

On the question about NCT members, all NCT members were appointed on five-year terms. They were not permanent as such, they were contract appointments. They did have three full time NCT Members and the other 10 members were part time NCT members. The three full time members included the Chairperson, who also had other responsibilities other than adjudication.

On the qualifications of NCT members, the NCA indicated that they had to be from a diverse background. From that perspective they were suitably qualified. They had all kinds of professions in the NCT, some had a legal background, others had an economic background. So depending on the case, the panels could then be put together with the relevant expertise. In relation to outsourcing, unfortunately, they could not get more on a temporary basis other than those appointed by the President. There were challenges there from an adjudication perspective because they had a limited amount of time they had to work with.

On administration human resources, in the interim, what they had done, was hire young students, while they were studying they could work part time at the NCT. Although they greatly assisted the NCT, it also came with its own challenges. As much as they assisted, there was a supervisory burden on the permanent staff. There was also the challenge of accurately capturing important information due to the part time nature of that solution. Where they were right now, they would have to look at more of a structured type resource. She did not want to say permanent resource as such because with the fluctuating case load it did not help to put people into permanent positions and ultimately the case load may not even support it. They may need a longer contract position to assist them.

On the management issues they faced, there were a number of aspects in relation to management and tracking of their cases. These were instances of inaccurate assessment and recording, not setting down the non-DRA cases as quickly as they would have like to happen. Looking at the entire process, they may want to do it in 175 days but with all the days in between, it took quite a bit of running faster in other areas to try and meet that overall time line. Often they went outside of that norm. That whole process was the subject of disciplinary procedures so she would not want to give more specific detail than that so as not to prejudice their other processes.

They had also done an external review, which was not yet complete, where they were specifically looking at performance information of some of their previous periods, so they could get a view of the accuracy of that and in relation to performance of some individuals. They had not yet received the report on that.

On the set downs not done as evidenced by the low NCT member fees, their NCT members were remunerated for work actually done. Whether they had 20 or 50 part-time members, this did not have an impact on their budget as they only paid members when they worked. So if NCT did not set down hearings and they did not come in then they did not charge fees. In the financial statements for this year and the previous year, what they had spent on NCT member fees was actually 20% lower than the previous year. That was partly because of other interventions they had put in place, like the motion courts where they heard more matters during a day. For a period, they did not have as many set downs as they would have liked.

The responsibility to set down matters lay with the Registrar’s office. The Registrar was responsible for their case management process. Then in terms of legal assistance and how they helped consumers at the hearings, the NCT was inquisitorial and they took that power quite seriously. There had been instances where for example, a consumer was on the one side and the other side was represented by legal counsel, they would insist that the lawyer did not use lawyer-speak, but rather plain, normal English and explain difficult terms in plain English so the consumer could understand the points put forward. The panel took quite an active part in the hearing, not to the extent that they would make a case for either side, but assisting a party with the process. They would explain to a consumer that this was where they were at in terms of process and what the consumer was expected to provide. They would assist if witnesses were being brought through and the panel noticed that the consumer was struggling to put his case to the witness, the panel would assist with that. So it was quite an active process, and because of the way the process had been set up, legal assistance was actually not necessary at NCT. The panel did help. Similarly, outside of a NCT process, when it came to filing, the Registrar’s office would assist consumers and unrepresented parties with their filings. Their forms were quite indicative of everything one would need. There were little tick boxes where one could tick what they had, and if they required any assistance over and above, telephonically or in person, the staff would help with that.

On guidelines, Ms Bosch stated what they were going to do going forward. They were going to phase down the assessment of DRA, but also non-DRA they were still going to be doing those assessments, they were going to be issuing a guidance note to parties. It would be explained how to file at the NCT, what to do at a hearing and what to expect. It was a work in progress. Currently there was no legal aid at NCT because it was not necessary. With these support tools at the NCT, a party should be able to bring a case forward.

There was a question about criminal investigations and what NCT did. That was something that the regulators would have to respond to. The NCT heard matters brought to it, and these were not criminal cases as such.

On whether postponements were a deliberate attempt on the part of defendants and what NCT could do to mitigate that, as with anything, one could have suspicions, but what the NCT could and did do, was actually consider the merits of the application. If there was merit in granting the application, then they would grant it, if not, they would refuse it. As an adjudicator that was the best the NCT could do with those.

On how they managed with finances even with the explosion of cases, there had been a number of interventions. They had increased their expectations of all staff members so that they could get more within the time available. From a financial perspective, they had implemented the motion courts which assisted them in dealing with more matters. They had issued a large number of matters through motion courts. They heard more than 1 non-DRA matter a day. Their filing fee had increased which had assisted NCT. They were going to be looking at future ICT, the decision support which was quite important, they wanted to implement purse management, which would be a system where the filing fees got paid online and were recorded directly in their system, thus reducing the time and resources to reconcile these. They were always looking at cost savings, for example around travelling and digitalisation. So for example, if they more than one matter a day then members only needed to travel once..

Ms Bosch said that the Chairperson had mentioned the strain that ICT measures could place on an organisation. In 2015/16 they really saw that in their own environment, that was why they were anticipating some future enhancements to their system and they would really be placing quite a bit of focus on change management around that, and also on service level management so that they ultimately had fewer user adoption issues which had their own impacts.

Mr Hill-Lewis said that he understood the explanation given by Ms Mabuza, but he did not accept it. For him, to suggest that NCC had only found one case the entire year to refer to the NCT was evidence of a huge lack of effort. Everyone present knew there were many more cases out there of unacceptable practices against consumers. In fact it was evidenced by the fact that 137 consumers had taken the NCC non-referral and gone to the NCT anyway. So he was interested to know from the NCT how many of those 137 consumers had they ruled in favour of. Each one of those cases would suggest that the NCC should have acted and not issued a non-referral. They also obviously knew that 137 cases was miniscule in comparison to the number of questionable and illegal practices that consumers suffered on a daily basis in South Africa. For him it was unacceptable that NCC was so inactive in that space.

He asked for an update on the CapFin reckless lending matter. For the Lewis matter, he asked for the date of that hearing, and he reminded everyone that those hearings were open to the public. On slide 25, of matters referred to NCT by NCR, 25 matters had been finalised in 2015/16. Of those, did she remember how many they ruled in favour of the NCR and how many they ruled against?

Mr Williams asked a follow up question on the NCT decision support system. He took it that a person was doing that job at the moment. A computer would eventually kick in and that person would stop doing that job. Based on his experience in other portfolios, what happened in the future when that system crashed? When they replaced humans with computers and then the computer system crashed, they had a serious problem on their hands. He asked if they had a contingency plan for that.

The Chairperson asked about the matters that the NCT turned down because of insufficient information. Earlier on there was reference to a matter that was sent back to the NCC because not everything was there. Did they follow a proactive practice in these cases, where they were able to alert, and this was what she thought the guidance note would be able to do, alert people as to what was essential for the application to move, and how soon did they communicate with those applicants to say unfortunately they could not take this because it was incomplete and they needed a certain document. In other words, the small things that tended to hold up a case.

Ms Bosch stated that in relation to the 137 matters, just a correction there: 23 of those were non-referrals in terms of the CPA, and those were all grouped together to make 137. On the 23 cases - which ones they found for and against consumers - they would have to do a written reply because they did not have that figure offhand. On the CapFin matter, NCR would deal with it. The date of the Lewis hearing was 28 July 2016 and it was open to the public.

The Chairperson asked that they respond to all remaining questions in writing due to time constraints. Did they have a strategy for their human resources, in terms of profiling? At one stage they did have a human resources manager who was a black African, who had left. When they spoke of transformation, they needed to do it broadly. The work place itself, she understood they did not have a union, so what did they have? All of these were to be answered in writing.

Mr Hill-Lewis asked where did they get the legal advice that simply because the holiday club matter had been rejected for a filing or technical issue on service of papers, they could no longer use those underlying transgressions. He was not an advocate, but his understanding was that was not normal court practice. If one made a technical error in filing of court papers, it did not nullify the underlying transgression that had taken place. He did not understand the NCC’s explanation of the unbelievable delay in this case.

Ms Mabuza answered that the manner in which they had clubbed together the holiday clubs, they were investigating industry wide. In this case, they wanted to break it down to specific holiday clubs and then deal with specific cases. They would be going directly to the NCT, There would be matters in terms of the contraventions that would have to be adjudicated on by the court, so they had to separate the two. Hence now they were separating them to deal with the separate issues in the different forums, but they would put that in writing.

Ms Terblanche stated that they still needed to respond to the CapFin matter, she thought it was quite an important matter.

Ms Nomsa Motshegare, NCR CEO, replied on the CapFin matter that they had reached a settlement with CapFin. They needed to get redress for consumers speedily because they felt a number of those credit agreements had already been paid off in any event, so consumers were not going to get any more redress if they left it with the NCT.

The Chairperson stated that they would have to call some people back. She asked member to ask their question so they could be answered in writing.

Mr Hill-Lewis wanted to make sure he understood what Ms Motshegare had said: the consumer had paid off the loan or the loan had been written off?

Mr Lesiba Mashapa, NCR Company Secretary, answered that if an allegation of reckless lending was made, the Act gave the NCT specific powers. Those powers mainly applied when the accounts were open. Once the account was paid off, even if they set aside the credit agreement, once the account was paid off, they could no longer give redress. If it was said to the lender that they thought it was reckless lending, the lender may say that in the spirit of reaching an agreement, they agree to write off the outstanding balance, then it benefited the customers.

Mr Macpherson was concerned about the direction in which the meeting was heading. He asked if they were going to have interaction with NCR today, because he would like to engage with the document that they had just received, regarding referrals to the consumer commission and criminal cases. This was what the Committee had been asking for. There was some startling information that they needed clarity on. He would just like two minutes to ask some questions on it.

The Chairperson understood what he was saying. She wanted to suggest as a way forward, was that he raised the issues, they came back in writing. So once they had received the response in writing, they could then distribute them to members. When they needed further clarification on what had been said in response, they could request it. They could make space in August for a further meeting if needed.

Mr Hill-Lewis asked to complete the CapFin matter before moving on to the criminal matters. He did not agree with the answer given by NCR regarding CapFin. If any person in this room committed an offence for which there was documentary proof, it did not matter that it was a year or two years after the crime, they could still be prosecuted because there was evidence. There was no statute of limitations. NCR was saying that because the consumer had paid off the loan, even if the loan was reckless, the case was over. There was the original documentation of the affordability assessment in bank records, all the payment statements had to still be on record. So how could it be said that there was no follow up action against the banks simply because the loans had been paid up. That was unacceptable. If that was the interpretation of the law, then please go to court and test the law. If they lost then they knew the interpretation and they could fix the legislation. But they could not guarantee justice for consumers if they kept taking the most conservative approach and the most hesitant interpretation. They had to be vigorous in their application of the Act. If they lost he would be much happier to pat them on the back to say they had tried and lost rather than they had not tried at all. For him it was irrelevant that the consumer had paid off the loan, the bank had still broken the National Credit Act and should be prosecuted or at the very least fined. The consumer should be repaid all of the interest they paid on that loan.

The Chairperson was not entirely familiar with this case, however, the point made certainly seemed to have some substance to it. She asked what was the legal impediment in not pursuing it.

Mr Mashapa stated that the powers that the NCR had now if they found reckless lending, they could set aside the credit agreement which meant they annulled the credit agreement. In instances where the loans were paid off this did not help the consumer. Alternatively, NCR could restructure the credit loan, if the loan was still open and they believed the consumer was over indebted because of that loan. The NCR did not have the power to order a refund of the cost of credit paid. In all the settlements, they also negotiated a fine, it was not only redress for the consumer, but the lenders also agreed to pay a fine. They could provide that to the Committee in writing, because it also included confidential losses in the agreements.

The Chairperson said that that was exactly what the Committee was concerned about the challenges that NCR faced in enforcing its mandate, due to its current powers. NCR had raised these concerns. The Committee had said that they could not immediately launch into an amendment of the Act now but it was their intention to pursue this. Debt forgiveness had also been raised. The NCR pointed out that the current powers in the Act did not allow them to pursue certain things. So now they had a case in point, different agencies and sections of government had different powers, and they needed to rely on that. The Committee knew they could not do this now because their calendar was so full, but there was a need to factor this in. This was why DTI was also present to give a briefing on the implementation of the National Credit Amendment Act.

Mr Macpherson stated that they often sat and debated why these companies did the things they did. It was because they knew they could get away with it. This document proved exactly that. Dating back to 2012, 46 out of 56 cases were awaiting action by the police. Seven cases out of the 56 resulted in a fine. That was 12% of all cases and that was only in 2011. Of the 56, only 1 case resulted in imprisonment and that was in 2007. That was 1.7% of all cases referred to police. The highest fine paid, was an admission of guilt fine which was R12 500. That was the highest fine issued to anyone. All of those cases related to withholding of IDs, pin numbers and that sort of thing. Not one case had been referred to the criminal court for reckless lending. That was why the lenders knew they could get away with it. For them, crime paid, breaking the Credit Act paid. They knew that they could spend 358 days dragging out the process. They knew that if they were being investigated by the police, that there was an 82% chance that nothing would happen. If by any chance, they found themselves in a court of law, only 12% of them would have action taken against them. By and large, he knew that this was not Ms Motshegare’s fault. What he did find unacceptable was that not a single case had been referred to the criminal court for reckless lending. He knew the matter related to the Justice and Police portfolio. He had asked last August, that they urgently convene a meeting with the Justice and Police Committees, and ask them why it was that SAPS took so long. It had been four years that they had been investigating some cases. 82% of cases were four years or older. He asked why the justice system saw it fit to issue R5000 fines to people who broke the Act.

The Chairperson stated that the Committee had already taken that decision last week. It had already been resolved. She appreciated his reemphasis on the matter that four departments were involved: Justice, Trade and Industry, NCR, Social Development. At the moment they were on track with Social Development, with those social grant cards. A meeting was held with National Treasury last week, and the Minister was aware this needed to be done, as the Committee had requested. They could review the powers of the NCR. It would not answer everything but at least it would beef up their powers.

Mr Kalako (ANC) agreed that the point raised by Mr Macpherson was very important, because it was a problem. It was not necessarily a DTI or NCR problem. For SAPS and Justice, they would have to reemphasise the importance of that with those Portfolio Committees.

The Chairperson indicated to Mr Macpherson that he would be able to address the Committee after the meeting with a formal tabling.

Mr Macpherson stated that he wanted to table a formal discussion at the next possible meeting.

The Chairperson thought their meeting on IPAP would be the suitable place to raise this next week.

The concerns spelt out by Mr Williams were about the retrenchment of workers. The issue could not continue, where people had responsibly incurred debt or credit and then found themselves out of work unexpectedly. They heard from NCR about the NINA issue: no income no asset. The way some financial houses were working, they understood the law very well. If the consumer had not paid everything off, it was not theirs. When they got into these difficulties they then faced these problems. The Committee made it very clear that they were not happy to carry on with DTI not being able to exercise the powers that it may have in this regard. They may need to do further study, they understood that, but the reality was low income and the employed poor were facing challenges. They would like DTI to deal with this issue and she wanted robust engagement from committee members.

Department of Trade and Industry
Mr MacDonald Netshitenzhe, DTI Chief Director of Policy and Legislation: Consumer and Corporate Regulation Directorate, said he had been guided by the Chairperson to deal with certain issues, but in the presentation they had prepared, it said how the DTI was going to work with other departments in order to enforce the National Credit Act, so it was wider. As for now, they were here to account, ever since the passage of the NCAA, what the DTI had done. There was a Cabinet Memorandum that said DTI, Department of Justice, National Treasury had to address household over indebtedness. When the NCA was also passed, they were mandated by the Committee to look at the issue of cost of credit, household indebtedness, so that was what they were addressing in the presentation.

He was there to assure the Committee that they had done all they were mandated to do by this Committee. His colleague would do the presentation on what DTI had done and he would speak on what Department of Justice was doing in order to complement DTI, as well as Departments of Social Development and Public Service and Administration. That was in order to answer how DTI could work with other departments to enforce the NCA. All in all, the two mandates from Cabinet and this Committee were always in mind. What were the powers within DTI and the agencies to cap interest, as an example?

Judge Desai, who ruled on the emolument attachment orders or garnishee orders in the Stellenbosch case, immediately jumped into the affordability assessment that was in the NCAA. The judge said it would be better for magistrates in the Magistrates' Courts Act, to also have an affordability assessment, since people are over indebted but getting credit and they do not know how they will pay. The magistrate in the lower court had found in favour of those who were wrong although it was pure reckless lending. The Magistrates' Courts Act did not have such criteria, there was no guidance for the courts. The judge said that DTI had already moved on this, so DTI’s efforts on the NCAA were appreciated by the judge

The Department of Justice had introduced the Courts of Law Amendment Bill amending the Magistrates' Courts Act and the Superior Courts Act. It was approved by Cabinet for wider public consultation in February, and then on 11 May 2016 Cabinet approved it for introduction into Parliament. So the issues the Committee was talking about, the Magistrates using the affordability assessment, would be catered for.

On the Department of Social Development (DSD), it can be recalled that during the processing of the amendments to the NCA, DSD had requested amendments to the Credit Act and asked DTI to assist it. The assistance became clear during the affordability assessment say that if someone was using the social grant to get credit, that person should be left with at least R800 a month, they called it a buffer. The DPSA was also doing something about people who had garnishee orders against them. The employer could enforce the payment of the credit this way and therefore DPSA was doing something. This would be clarified soon. They had to have concerted effort as departments to implement the NCAA as it did not reside in the DTI alone. The presentation would clearly indicate this cohesive force.

On additional powers for NCR, it would be done in accordance with the Constitution. The DTI had benchmarked other departments and similar agencies, like South African Reserve Bank (SARB), Financial Services Board (FSB) who also had such powers. DTI would be going to Cabinet with a memorandum and introducing a bill to Cabinet, and then it would be introduced to Parliament. Debt forgiveness would be covered in detail in the presentation, but he was giving a wider background to give context to the merits of the presentation. Mr Kumkani would deal with DTI in the presentation and he would be dealing with coordination  with Department of Justice, Department of Social Development, DPSA and National Treasury. What National Treasury was saying last week would be complemented by what DTI was saying.

Mr Siphamandla Kumkani, DTI Director: Credit Law and Policy, said that in terms of the DTI mandate as per the Cabinet statement in 2013, it had managed to execute all the programmes listed in that statement. To the extent that in 2016/17 they would be focusing on education awareness programmes. They also wanted to ensure that there was certainty in the market. When they issued regulations all the time, the market shook and there was a lot of uncertainty. He wanted to assure the Committee that in this financial year, they had finalised the regulations. They were not going to issue any more.

Since the proclamation of the NCAA in 2014, DTI had worked on the implementation of the affordability assessment regulations. In slide 7, those were the areas they had worked on. The affordability assessment regulations had been finalised in 2015 and they came into force in September 2015. The NCR could comment on how far the industry had come in terms of complying with the regulations.

Within the affordability assessment regulations, they had included maintenance and social grants which had to be taken into account, for verification of income. These were crucial issues that the Committee had proposed. He indicated that, in line with Department of Justice should be doing, they had dealt with the issue of collection and sale of prescribed debts, which they thought if it was dealt with precisely and effectively it could have a huge impact in reducing over indebtedness. The sale of prescribed debts between credit providers, meant people ended up paying for debts that had long prescribed because they were not aware of the law. The responsibility given to the credit providers was to ensure the information provided to credit bureaus should be accurate, and they should not be giving information that included prescribed debts. In relation to paid up judgment debts, before the regulations came into being, judgement debts would stay in the bureaus for over five years. Since they had introduced the regulations, judgements were expected to be automatically removed after being paid up. Those were some of the things that they ensured had to be done. The affordability assessment regulations in essence, were in operation and everyone was expected to be compliant.

On the capping of interest rates and fees, the interest rates and fees were finalised, and they came into operation on 6 May 2016. This had been a long and difficult process because DTI was busy doing the review and had the court case alongside which had been instituted by micro-finance who wanted an increase on service fees. The Minister complied with the court order and then issued the draft regulations on 26 June 2015 for public consultation. All industry role-players were given a chance to provide input until they finalised the process in November 2015, where they gave the industry a six-month period to work on their systems.  They were happy to indicate that the regulations had come into force on 6 May 2016. These regulations would affect new credit agreements entered into after 6 May 2016.

On 9 February 2016, they briefed the Committee on the interest rates and fees. Slide 11 was a summary of the changes that DTI had effected in the final regulations. The current formulation used was the repo rate plus making a determination. Stakeholders found that was quite user friendly and easy to understand, and consumers would be able to use it. This was the slide used in the previous presentation, but now the repo rate was 7%, and thanks to the Governor it remained unchanged. There was an agreement when the Committee raised reducing the rates. After the interaction with the Committee, they were given the go ahead to implement the regulations with the understanding that further reductions on mortgages and developmental credit should actually be considered.

Slide 14 dealt with credit life insurance, but he wanted to sum up on the interest rates and fees. When they had gone to implement the rates on 6 May 2016, micro finance further lodged an application to court to prevent the Minister from implementing the regulations. That was on 1 March 2016. The matter was set down for 3 May 2016. The first part of the application was to prevent implementation on 6 May 2016. The second part was dealing with the review of interest rates, because they were not happy with the regulations as finalised, they were still too low and DTI had not increased them enough. The matter was set down for 3 May and judgment was issued on 5 May 2016, where the judge dismissed the application with costs, indicating that there was nothing that showed that there was urgency in the matter. If they wanted to file part B of their application they were welcome to follow court processes. He highlighted this because DTI would continue doing this work even with these legal challenges. They were yet to hear if part B would succeed, but the lawyers were busy working on that.

With respect to credit life insurance, it was also part of their mandate to deal with the abuse in the credit life space. There was mis-selling of insurance products, no standardisation of how much credit debtor should pay for credit life insurance upon entering into a credit transaction. There were a lot of abuses in the market. DTI together with NCR and FSB, came up with a new set of capped fees for credit life insurers. For example, in terms of draft regulations, mortgage fees were capped at R2 per R1000. But in respect of other facilities and other transactions, they were capped at R4,50 per R1000 as opposed to the normal practice that had been in the market, where consumers were charged between R10 and R50 per R1000. They had finalised the process and issued the draft regulations in December or November. They were due to finalise with the FSB because there was also credit aspects. The credit life insurance had to be under a particular insurance company. So because of the cross cutting issues, FSB and NCR were making final touches into the regulations before approaching the Minister of Finance and consult with him as required by s106(8). After the consultation, their Minister would issue them as final. As the Committee was seeing them on the slides, these were the proposed capped credit life insurance fees of which, after they had been finalised, they would be coming back to the Committee to indicate whether there had been a slight change, or whether there was no change whatsoever.

Credit life insurance, they were looking at making sure the draft regulations were implementable at the time of final publication. They were definitely going to give industry time to work on their systems, to ensure they were up to date and so on. NCR on other side, would talk to investigations that had been conducted specifically on credit life insurance, for example the Lewis case, JDG Trading and Shoprite.

This month the Minister had finalised the regulations on prescription of a threshold for all credit providers.

The Chairperson asked him to explain what was meant by cell captive insurers on the JDG slide.

Mr Mashapa said it was the Joshua Doore Group, and the NCR would, after DTI had finalised their presentation, give an update on how far they had gone in that particular area. The NCR was in a good position to explain since they were in a hands-on position, and he did not want to misquote them.

Mr Kumkani noted that the threshold regulations had been finalised on 11 May 2016. The requirement for all credit providers to be registered with NCR was if they had over 100 credit agreements or if they had credit agreements to the value of R500 000. That threshold had been done away with since the enactment of the Act, to the extent that now the Minister had introduced a nil registration requirement. So anyone involved in the business of lending should be registered with NCR. This was done because there was a perception that doing all of the capping, people would run to the informal market. These regulations were actually finalised to deal with the informal market, where NCR would be enforcing the regulations and ensuring that everyone was registered. They would be conducting education awareness campaigns to ensure that people were registered with NCR.

Mr Netshitenzhe dealt with slide 29. The DTI intended to propose to Cabinet as raised by the Chairperson, that it needed to amend NCA to give more powers to NCR such as to impose fines. There was an agreement between DTI and the Minister. They would be coming with a Cabinet memorandum and later a Bill would be introduced into Parliament providing for these additional powers. During the discussion, he heard references to the police and the need for prosecution there. The NCR did not have powers there. They probably needed to close that gap during this period. They were going to review the investigative powers of the NCR, such as proactive investigations. All those issues would be in the Cabinet memorandum and the Bill. They would have to implement debt relief forgiveness programmes. What could belong to the Bill would be inserted, and what belonged to the regulations would have to be done there. Some of the issues may have to be programmes, they did not necessarily have to be in legislation. There may be a need for serious discussion, as agreed, the NCR needed to start talking to banks. They had already started to do this, to see to it that certain people should not have certain property and may have to be forgiven.

He spoke about the Department of Justice introducing the Courts of Law Amendment Bill into Parliament on 11 May 2016. The amendment to the Magistrates' Courts Act was in this Bill and it would deal with the affordability assessment. When the Magistrate was dealing with debt, they had to ask whether there was an affordability assessment. They would be forced to apply the affordability assessment as crafted by DTI. There was also the issue of consent to jurisdiction. Department of Justice had dome research on this. A person living in Limpopo will owe money to a furniture retailer there. That furniture retailer may have in its credit agreement that the consumer has consented to the jurisdiction of Kimberley Court in the Northern Cape. At the end of the day, a notice was not even served to the consumer because they had consented to a different jurisdiction. So execution went on without the consumer knowing. Those were done by clerks of the court whereas the Act said it should be done by a Magistrate, so there was too much fraud in between. This Bill was addressing this issue of people unknowingly consenting to another court's jurisdiction.

The Chairperson asked how long it would go out for public comment and whether the Department was handling the public hearings.

Mr Netshitenzhe replied that when Bills went to Parliament for the first time, generally they asked for wider public consultation, than was done by the department.

There was another Bill they were working on together, called the Debt Collectors Amendment Bill. Debt collectors were under the jurisdiction of Department of Justice. They had their own raids, they introduced a lot of raids. The attorneys were under the jurisdiction of Department of Justice, but they had their own rates as professionals. As an example, which might be a bad example, lawyers may say that their interest rates are 20%, while the debt collectors may say it is 10%. So when there was a collection on a credit agreement and the retailer referred it an attorney to do the collection, the 20% interest rate of the attorneys would apply, not the 10% of the debt collectors.

So when they were amending the Debt Collectors Act, DTI worked with National Treasury and the Department of Justice. If attorneys wanted to do the work of debt collection they had to fall under the Debt Collectors Act, not under the loose arrangement of the Law Society. There was going to be a lot of lobbying here and they requested when there was an inter-portfolio committee meeting, which they suggested, this matter should be monitored, because it was a matter of who had more power to lobby. That Bill was still a draft Bill; it had not yet been referred to Cabinet for introduction, it was still in consultation.

Amending the Prescription Act was moving slowly. According to the amended NCA, they said do not collect prescribed debt. It had to be prohibited conduct. However, the Prescription Act did not belong to DTI, it belonged to Department of Justice. It was an old Act and they were asking the Department of Justice to do something form their side, and pronounce on this practice. What DTI did was to emphasise that it was a prohibited conduct to collect prescribed debt.

The Chairperson asked whether it was a pre-1994 Bill, or exactly when was it enacted? Because they had taken a decision about 10 years ago regarding the alignment of legislation, and five years earlier the whole Taxation Act had come up because of these challenges.

Mr Hill-Lewis stated that it was enacted in 1967.

Mr Netshitenzhe had been informed that it was 1968, but he was not sure. They were not reporting on the Department of Justice here. On the Courts of Law Amendment Bill they were working very closely together. On the Debt Collectors Amendment Bill they were working together very well. They did what they did on the collecting of prescribed debt and therefore there was something they could do on their side.

The Department of Social Development and Black Sash came to Parliament and persuaded DTI to amend National Credit Act. DTI said that they could not deprive people of credit. What they could do was say that grants were worth R1400, but in the affordability assessment regulations they would insist that no one could take more than R800. That should remain with the person who held the grant, which was the best they could do. Social Development had introduced strict regulations pertaining to funeral policy deductions on social grants, particularly child support grants. Whilst they were doing that, there were companies, he remembered Sanlam, were currently taking the department to court for an interdict, after amending regulation 26(a) of the Social Assistance Act, which stipulated the deductions may not be made on child grants, foster child grants, care dependency grants that had been in effect for less than 12 months. This case was in the Mail & Guardian of last week. It showed that Social Development and DTI were working together to say that in terms of grants, one could not have three or four insurance policies at a time.

DPSA had a project dealing with emolument attachment orders because people’s salaries were being attached, and then the employer became a sort of debt collector, and if they did not do that it was an offence. When people’s salaries were attached, an affordability assessment may not have been done. Maybe there should be analysis. NCR and DPSA could find out if it was done. If not, perhaps they could go for debt forgiveness. They were just postulating. Education and awareness in all tiers of government, municipality, provincial and national, it had to be done about emolument attachment orders.

Whatever National Treasury had presented last week, held there. The big issue was that a lot of the powers needed to be enforced at an earlier stage, not only when there was a problem.

In conclusion, maybe there was a little bit more coordinated work done between departments since getting the mandate from the Committee to work with other departments and deal with over indebtedness and the cost of credit. Cabinet said over indebtedness needed to be looked at holistically and as one government. Inter-agency may also need to be dealt with, and they gave the example of s17(4) of NCAA that showed coordination between agencies. So it could be legislated.

The last part they were encouraging, the coordination at interdepartmental or inter-agency level, may have to be related to inter-ministerial or inter-Portfolio Committees action. The matter being discussed of calling the Portfolio Committee on Police, was what they were saying also. It seemed with the interdicts, while DTI was mandated to do this and that, there were court actions in between. DTI was being interdicted. Generally they said to DTI let's meet in court because they were testing the legislation. DTI should be using its time in passing legislation but they were called on to defend the legislation in court. This may cause some delays in the implementation of certain legislation.

Mr Hill-Lewis stated that the revised regulations on credit life insurance, were they going to be issued as final or were they going to be issued for public comment before they were finalised? He had not seen the revised ones, he recalled seeing the draft regulations in November.

There were cases where insurance providers had sold disability insurance to those who were already disabled. That was not specifically forbidden in the draft regulations. There was a clause which said that one could not sell unemployment insurance to those who were already unemployed, but it did not say that they could not sell disability insurance to those already disabled. It might be useful to see the updated draft regulations.

He was thrilled to hear DTI had won the case. He thought it would be useful for them to always send the Committee judgments which were relevant to them, he wanted to read that judgment but had not seen it yet. With regards to the new Bills that they were planning to introduce, his only comment was to hurry up. These things had been discussed in this Committee for at least three years so there needed to be some movement. There was a lot of comment made about the informal lending sector, but he referred to it as the illegal sector because it was illegal, and the practices there were appalling, there was a lot of violence and intimidation. The improvements made in the legal regulated space were excellent, and they were building a world class regulatory framework, however it meant nothing if it just pushed people into the illegal sector, and that is why the earlier discussion about the coordination with SAPS was so important because more and more consumers were pushed into the illegal space.

Mr Kalako (ANC) took this as a progress report after their discussions with DTI, especially on the amendments. He commended the DTI on the speed with which they had moved. He thought the challenge for the Committee and DTI is they would have to do a lot of lobbying with the other Committees for these Amendment Bills to be effected as soon as possible, so that they were not a hindrance to these matters. Where they would have to put on a strong fight was with the lawyers, they were all over. They did the same thing with Home Affairs and Immigration, they were specialists and once they entered a terrain they wanted to put in their own rules. They had to interface with Department of Justice. He wanted to check on the Prescription Act, what was stalling this amendment, especially when the government had already taken a decision on the realignment of all legislation.

Ms P Mantashe (ANC) observed that she was happy that Mr Hill-Lewis was seeing progress in what DTI and the Committee had done. It was funny though that in the debate, he was opposing whatever they were saying. The lawyers' case against the departments was what the DA was doing with the passing of legislation in Parliament. It was synonymous.

The Chairperson stated a lot of agencies that had presented to the Committee had mentioned risk profiling or modelling. They had the big boys present on 20 May as well. There was a list of nine economists from around the world, among them graduates of Columbia Business School, Brussels and London School of Economics. One of these economists, John Danielson, said that trusting risk models would lose one money in a crisis. That was something they ought to bear in mind. The other point was about the regulations. The private and even the public sector were unhappy about a strong regulatory framework. Yet the NCA was hailed internationally as saving South Africa from falling into the trough of insolvency. Those who liked this, were people from Harvard Business School. There were nine economists whose ideas were changing the world. They came from a number of ideologies, they seemed to have one thing in common - the understanding of the economy today - as rock star academia.

The second issue that was taking so long was gambling. Ideas to change it came out in 2009, and it was now 2016. With the NCA, they began to realise that things were not working and they passed amendments in 2007. They needed to beef up enforcement because they had an Act. Why did they make laws, to paper their walls? She was distressed to hear about reckless lending carried on even by so-called reputable institutions. They needed to look at SAPS commercial branch so that they worked together; the agencies and institutions. She wanted a spell out on social grants. DTI mentioned that they could not do too much about that. Yet at one stage she thought that they had said that one was not allowed to use that grant card as a debit card. Now that did not fall under DTI, it fell under National Treasury.

The other matter was the interest charges, where lawyers, perhaps short of work, were wanting to take on debt collection cases. She needed clarification. She thought that lawyers charged less than debt collectors that was why doctors used them.

Mr Macdonald answered that the regulations on credit life insurance were not final, they had to go back to Minister. The Minister had to consult with the Minister of Finance. That was why last time there was a delay of 6 months. The experts on the ground had agreed. Even last week, FSB was saying that they agreed with the draft. So what was left was for the regulations to go to the Minister and then to the Minister of Finance. If he was not mistaken, they also provided them to the Committee for comment so that there was convergence between the two Ministers and the Committee.

On disability, he took this advice. The experts were nodding, they had heard Mr Hill-Lewis, so something would be done. The judgments would be sent to the Committee. They had only won the interdict to say it was not an urgent matter. It seemed as though they were regrouping to go to the Judge-President to give them a date so that they could challenge them as invalid for the purposes of taking them on review. DTI would defend, no problem.

They were hurrying with the Bill. Two weeks ago it was completed and now they were moving. Cabinet would be approached. The Department of Justice had a lot of legislation. In the Desai case, on the affordability assessment for the farm workers who were highly indebted, it provoked a certain speed. The Prescription Amendment Bill, Debt Collectors Amendment Bill, Courts of Law Amendment Bill which stated that they had to use the affordability assessment - all he could say was that the departments were moving at different speeds. It seemed DTI had moved with some speed.

On lawyers’ interest, he would speak subject to correction. When they did a presentation on the Bill to Department of Justice, they confirmed that the interest of lawyers was higher than debt collectors. If he was not mistaken, they did sent a draft of interest from debt collectors, DTI commented, and there were various proposals. 10% won. The lawyers’ interest was still high. They were prepared to do it in writing. They were told by that DDG that there was a lot of lobbying, so the Committee could also talk to the other Committee so that they could close this issue. They could confirm that it was higher in writing, but since it was not in the same regulatory framework because they were not part of the debt collection agency they went back to law society and implemented there, therefore what they were doing was nothing. He took it as a comment.

He referred to the Chairperson's comment that the laws were there, but it seemed they were not building capacity in the area of enforcement. They would probably come to request money to support the NCR because the budget was too small. They would talk internally as DTI to say the budget was small but they wanted to build that capacity of enforcement.

Mr Kumkani added that with unsecured lending, most of the problems picked up, were people were paying off debts until they died, there were no statements issued showing the balance. Even government did not know where these people were operating. There were lots of garnishee orders that were being granted. Introducing these kinds of regulations was to ensure they monitored, regulated and they knew where they were. It was also to teach them that they had to be part and parcel of the bigger picture of the credit industry. There was a need for NCR to enforce the Act in that regard. With the retention of ID cards now dealt with effectively, it was a criminal offence to do those things.

To add on about social grants, DTI could not amend the Social Assistance Act, the only thing they could do within the affordability assessment, was put in a buffer. If when doing the assessment, the income went below R800, that particular loan had to be declined. It was how far they could go to ensure social grants were not used as collateral on credit.

On amending the Social Assistance Act, Mr Netshitenzhe said it was here in Parliament where they were approached by Black Sash to amend the National Credit Act. Could DTI deny credit to people? They also conferred with the State Law Advisors. It was not their jurisdiction. More particularly, they could not come and do a consequential amendment here, so they needed to go back and amend the legislation, and that was what they were trying to do.

The Chairperson did hear what he had said about finances and they would keep that in mind for the future, in the second year of the MTEF.

Mr Hill-Lewis felt that they had to consider amendments using a new category of criminal offence for repeat or gross reckless lending. So for example, the NCR found 699 cases of reckless lending at one branch of the African Bank in Dundee. That went beyond accidental reckless lending or an isolated incident. That should be dealt with as a criminal offence of reckless lending. He wanted to see that introduced as a separate category.

The Chairperson said that was a proposal that she did not think anyone was opposed to. On that particular note, they clearly were just at the beginning, they needed to do something urgently, particularly to entertain debt forgiveness. They had already agreed as a Committee that they would welcome amendment to the legislation that would include measures around reckless lending, and the powers of the NCR to effect its mandate more effectively, and not find legal impediments on the road to securing this. They did wish to look at all these things, they had even looked at university graduates who had student loans. She was glad that they had taken this on board with other departments such as Higher Education and Mineral Resources in terms of miners facing across the board forced retrenchment. They welcomed the expanded research and draft legislation, in early August. Perhaps they could send through reports in July as to how things were going, so that they did not find themselves looking at 2017 or 2018. She thanked all the entities there, NCT, NCR, NCC and DTI.

Next week on 24 May they would be meeting from 9:00 to 13:00, with major input on IPAP, which included steel issues, followed by the terms of reference on the colloquium on local procurement plus the verification issue. On 25 May, they had agreed to a joint meeting with Finance, on base erosion and profit shifting, and what they called transfer pricing, but also the Panama Papers.

Mr Macpherson asked if the Minister would be present on 24 May.

The Chairperson understood that he was scheduled to be, but he was travelling at length. She knew currently he was in Iraq. What they would have was the Director General, and DDG, Mr Strachan. There was no reason why he should not use that as the platform to raise his issues. 

Meeting adjourned.


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