Border Management Authority Bill [B9-2016]: discussion on way forward

Home Affairs

18 October 2016
Chairperson: Mr B Mashile (ANC)
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Meeting Summary

Due to the letter the Committee received from the Minister of Finance advising it not to deliberate on the South African Revenue Services (SARS) related matters, the Committee resolved to refer the Border Management Authority Bill to the concerned departments for further engagement.

The Committee noted that the letter required a specific engagement outside of the scheduled meeting and had a serious impact on the Bill.

National Treasury reported that it held a lot of meetings and reached various agreements on how to proceed with the Bill. In this respect, it had decided to stick to the recommendations contained in the Davis Tax Commission Report. It was not against establishment of the BMA but it did not support the transferring of the SARS’s function to the BMA. SARS should collect the revenue.

The Department of Home Affairs stated that it preferred to follow the Chairperson’s proposed approach: the matter should be discussed between the concerned departments. It was worth noting that the BMA was not a brain child of the DHA but cabinet.

The Committee considered the DHA’s responses to the questions posed by the Chairperson and the DA’s submissions. The Committee were of the view that the DA’s inputs and responses received from the DHA would help the drafters to improve the content of the Bill while awaiting for the Minister of Finance and the Minister of Home Affairs to resolve their differences on operationalisation of the BMA.


Meeting report

Opening Remarks
The Chairperson welcomed everyone.

The Chairperson explained that there had been several developments on the Border Management Authority Bill. First, last week the Department of Home Affairs presented a proposal on how to deal with customs at ports of entry. This proposal was sent to National Treasury for comment and this has finally been received. In its response, National Treasury raised issues that require engagement outside this forum. The document had been circulated to Members. In his view, the two ministers, together with the Deputy President, must have a serious engagement to see if we can’t have a way forward. He had originally thought this would happen this week but Treasury was busy with preparations for the MTBPS so it is only likely to happen next week. The Committee would not make much head way in debating this without the two political prinicpals.
Second, the DA had submitted a written proposal, and the Committee would review this.

The Chairperson introduced members of the DHA delegation, National Treasury delegation, SAPS delegation and Parliamentary staff. He acknowledged apologies from SJ Nkomo (IFP), Ms O Hlope (EFF) and Ms NA Mnisi (ANC) for their absence and from Ms TE Kenye for late arrival.

Deliberation on letter from the Minister of the Finance
Mr Ismail Momoniat, Deputy Director-General: Tax and Financial Sector Policy, National Treasury said that the National Treasury held a lot of meetings and reached various agreements on how to proceed with the Bill. In this respect, National Treasury decided to stick on the recommendations contained in the Davis Tax Commission Report.  They were not against establishment of the BMA but did not support the transfer of the SARS’s function to the BMA. SARS should collect the revenue. In fact, disagreement between the National Treasury and the DHA was small. In the view of the National Treasury, it would not be in the interest of the public to transfer the functions of SARS to BMA.

Mr Mkuseli Apleni, Director-General, DHA, remarked that the he preferred to follow the Chairperson’s proposed approach - the matter should be discussed between the concerned departments. He stressed that he was working on the Bill simply because of the outcome of the Cabinet decision and not because of the Minister of Home Affairs’ decision. The decision being implemented was a Cabinet resolution.

Alluding to the letter, the Chairperson explained that the Minister of Finance had advised him that the Committee should not deal with anything to do with custom collection. In a nutshell, the Committee should not touch SARS related matters. Taking this into account, the meeting would not take the Committee anywhere. There would be no progress.

Mr M Hoosen (DA) said that the Minister’s letter would have a serious effect on the Committee’s engagement with the Bill.

Mr D Gumede (ANC) first apologised for coming late and then remarked that, in his understanding, the BMA was a cabinet decision and that the Minister of Finance was a member of that Cabinet. It was discouraging if one considered that there had been engagement between the National Treasury and the DHA for more than six months and there were no good results. The Minister’s letter was an indication that there was no engagement at all. He was asking himself why these two parties could not reach a concrete agreement. In the previous meeting, the DHA indicated that it was not interested in collecting revenue. So what is the problem? It seems that Treasury was against the establishment of the BMA.

The Chairperson felt that the BMA Bill needed more time for the DHA and National Treasury to discuss and solve their differences.

Ms D Raphuti (ANC) said that she had read the letter. Clearly, the Minister of Finance was not against the establishment of BMA. Instead, he wanted the BMA to be established but certain functions of SARS could not be transferred to the BMA. These functions could be transferred to the BMA when the Treasury was satisfied that the BMA could take over the functions in question. Accordingly, the Committee should propose the period in which the functions of SARS could be transferred to the BMA.

Mr Apleni noted that it was discouraging to hear that the Minister of Finance was not working together with the DHA to ensure operations of the BMA. It was crucial to note that the introduction of the Bill went through various stages. It was initiated by the Cabinet decision. It was then drafted. The first draft was sent to the Cabinet for approval. It was approved. The Draft Bill was published for public comments. These comments were incorporated in the Bill. After these exercises, the Draft Bill was sent to the Committee for consideration. He placed emphasis on the fact that the DHA was not the initiator of the Bill. Rather, Cabinet decided that the DHA should lead the establishment of the BMA and the craft enabling legislation. When these decisions were taken by the Cabinet, the Minister of Finance was there. The Department of Finance had a time to express their concerns during cabinet discussion and drafting processes. Why should Treasury feel threatened by the Bill? The Minister of Finance could not override the decision of the Cabinet.

The Chairperson stated that the Bill should be returned where originated for further engagement.

Mr Momoniat felt that issues of disagreement stemmed from interpretation of the Cabinet decision. The collection of taxes and revenue could not be spilt.

The Chairperson responded that both Mr Apleni and Mr Momoniat were not part of the Cabinet; instead they received mandate from their bosses and there could not quarrel on the mandate which was beyond their reach.

The DHA’s responses to the questions posed by the Chairperson
The Chairperson took Members through the responses to the 34 questions posed by the Committee. On the question of whether there should be two Deputy Commissioners to assume the office when the Commissioner was attending to other commitments, the DHA responded in the affirmative. After deliberations, Members agreed that the President should be empowered to appoint the Commissioner and two Deputy Commissioners.

On the question of extending the time of presidential notification to recruit the Commissioner, the DHA extended the time to six months from three months. The time to vacate office was also extended to 65 years in order to align it with the Public Service Act, 1994. The retention of Commissioner beyond 65 years was possible, but could not go beyond maximum of two years. Mr Apleni stated that extension of retirement age could, in certain exceptional circumstances, be extended by Parliament.

On the question of border guards to have identifications card, the DHA responded that they would be in uniform.

The DHA explained that the BMA was proposed to be established as a Schedule 3A National Public Entity, which had the status and conditions of employment of the Commissioner. His remuneration might be more favourable than that of Director General because his/her work entailed various expertises.

On the question of seeking support from SAPS and SANDF, Members argued that Border Guard officers might encounter a serious a challenge and come to insurmountable problem and request the SAPS assistance and sought clarity on whether the SAPS or SANDF had to comply. Mr Apleni stated that it was in agreement with the SAPS and believed that the Bill was speaking to this situation.

On the question of fundraising or accepting donations from private persons, Mr Apleni, referring to clause 23, stated that the PFMA would be regulating the BMA revenue and finances. In terms of the PFMA, the donation was subject to the National Treasury’s approval. The BMA could receive a donation when it was donated by other departments. Donations could not be cash if provided by other people. The BMA could not fundraise. All donations in cash ought to be subjected to PFMA.

The Chairperson felt that the BMA should not fundraise because it was a security entity and that accepting donations would open the door to manipulation of the agency. The Committee should ensure that there was no room of manipulation of the BMA which would play a major role in securing South Africa.

Mr E Kekana (ANC) seconded the Chairperson and noted that in dealing with security matters, there should be no reason to justify acceptance of a donation.

The Chairperson stated that the matter should be left to the DHA to reconsider.

On the question of whether the Minister of Home Affairs should automatically chair the Inter-Ministerial Consultative Committee (IMCC), the DHA responded that it would be wise to have another Minister to chair the IMCC given that the Minister of Home Affairs would be reporting to the BMA. The Chairperson stated that because the BMA was under the DHA, the Minister of home affairs ought to chair the inter-ministerial committee or meetings. Mr Apleni stated the Minister should rather co-chair. Mr Gumede felt that there should be a professional secretariat who should head the IMCC because there might be cases where ministers might be away or busy and could not convene meetings or respond to certain concerns on time.

On the question of of Agriculture, Cooperative Government, Environmental Affairs, Health and Economic Development in the IMCC, the DHA responded that the IMCC was limited to core principal departments, with others included as and when the need arise. The Chairperson stated that all departments were affected by the BMA Bill but there were those who were directly affected, in particular, the DHA, SAPS and SANDF.

Ms Raphuti felt that all departments should form part of the IMCC.

Ms T Kenye (ANC) said that it was not wise to reduce departments to core departments.

The Chairperson said that Members were deviating from the mandate that was given to the DHA to reduce the number of departments. To him, the president should be given power to extend membership of the IMCC as and when need arises. The IMCCC could not be convened as a Cabinet. Rather, directly affected departments should form part of it.

Mr Hoosen stated that the Department of Tourism and Economic Development should be part of the IMCC.

Mr Gumede cautioned Members and advised them to step back and ask themselves what issues the IMCC would be dealing with. As a principle, it was a Cabinet that determined policy and directions. This should be taken into account in deciding who should be or not in the IMCC.

Members agreed with other responses provided

The Chairperson requested Mr Hoosen to brief the Committee on the DA’s submissions.

DA’s submission on the Bill
Mr Hoosen took the Committee through the DA’s proposed amendments to BMA.

After taking the Committee through proposed amendments, Mr Apleni stated that submission from the DA was received that morning and his Department was not in a position to comment more about it. The BMA was proposed to be a single coordinated entity. This implied that there would be no other person in the border line. All those people, be it from defence, SAPS would be working as a part of and reporting to the BMA. Mr Apleni stated that the DHA would respond on the issues raised in writing.

Mr Gumede stated that some issues raised by the DA was covered by the responses from the DHA and those covered should be ruled out.

Ms Raphuti stated that many issues being raised by the DA were administrative and should be dealt by the DHA and responded to in writing. She was concerned that the submission was submitted that morning and Members did not get adequate time to engage with it.

Mr Kekana and Ms Kenye seconded Ms Raphuti.

Members went through the DA’s concerns one by one and stated that they were materially substantive. The Chairperson stated that both responses and the DA’s concerns should be taken into consideration in redrafting the Bill.

Consideration and adoption of the letter addressed to the Director-General of Finance
The Chairperson said that in the previous meeting Members had talked about the cutting of remuneration of the DHA workers. In this regard, he had written the letter addressed to the Director General of Finance.  He read the letter.

Members approved the letter.

The Chairperson stated that the DA’s inputs and responses received from the DHA would help the drafters to improve the content of the Bill.

Meeting was adjourned.


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