Processes and procedures in developing legislation; Summary and analysis of legislation administered by DSBD

Small Business Development

27 November 2019
Chairperson: Ms V Siwela (ANC)
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Meeting Summary

Members of the Portfolio Committee were made aware of how a Bill was tabled in Parliament, and the various processes involved before it became law. The Committee’s researcher gave a detailed explanation of the different types of Bills that could be initiated, and the criteria that determined whether they would be processed through the National Assembly or the National Council of Provinces.

Members’ main concerns were the length of time it took for the legislative process to be completed. It heard that research by the Parliamentary Monitoring Group (PMG) had found the average duration to be 183 days. The Chairperson wanted to know what could be done to speed the process up, because it impacted on service delivery.

A Member commented that the scarcity of Private Members’ Bills seemed to indicate a fear to initiate legislation because it was considered the preserve of the Executive. An opposition Member contended that in the past, Bills initiated by the opposition were “wiped off the table” due to political interference, to the extent that the late Dr Mario Ambrosini had had to go to court to get his Bill adopted as law.

The Chairperson said barriers between parties had to be removed, as Members were all part of the same Parliament, with a common mission to bring service delivery to the people.


Meeting report

How to review and amend legislation

Ms Nwabisa Mbelekane, Committee Researcher, said the Legacy Report helped Members to realise there was a need for legislation to be reviewed and amended, so she would provide the ‘HOW’ to do so. The “red-tape Bill”, the review of the Small Business Act and the Small Business Ombudsman, were all situations where this knowledge would be applicable.
Challenges existed, and the way to take the sector forward was through legislation. The Committee’s role and Parliament’s role, and the obligation vested on the Committee, was to make law. The objectives of making laws could be found on page 3 of the ‘Processes and Procedures of Passing a Law in Parliament: The National Assembly.’

The constitution prescribes that Parliament should make laws in certain areas, and the constitution provides guidance on what laws should be made, for example, on matters relating to agriculture, consumer protection, health, housing, public transport, regional planning and development, and this was found in schedule 4 of the constitution. Schedule 5 of the constitution deals with laws made in relation to matters of provincial-planning, liquor-licensing, provincial roads, traffic and provincial sport.  Part B of schedule 4 relates to municipal by-laws on building regulations, municipal health services and trading, and part B of schedule 5 talks to controlling local amenities and street trading.

The Constitution talks about there being different types of Bills because there are different procedures for each Bill. When draft legislation is introduced into Parliament, the type of Bill needs to be known. A s74 Bill amends the constitution and aims at making changes to the basic values of the constitution. A s75 Bill is an ordinary Bill not affecting the provinces and can be introduced only in the National Assembly. A s76 Bill which affects the provinces may be introduced in either the National Assembly or the National Council of Provinces ((NCOP), but must be considered in both Houses. Lastly, a s77 Bill which relates to money, levies, taxes and appropriations which is introduced in Parliament by the Minister of Finance, must be introduced in the National Assembly.
There were three ways to introduce a Bill:
Private Members’ Bills (s75 refers to a Member in the National Assembly);
Through a Committee, like the Portfolio Committee on Small Business Development; and
Executive Bills. This was the common way of introducing Bills, making up 90% of Bills delivered. These were initiated by the Minister and Deputy Minister, where nobody else could initiate them.

Drafts of Bills should be accompanied by a legal opinion from a legal advisor before it can be approved to be in the gazette. The draft would be reviewed by a social-economic impact unit established by the presidency. The aim of the unit was to help drafters evaluate the implementation and compliance costs, as well as the impact of the draft legislation on the priorities of the nation -- economic inclusion, growth and environmental sustainability – as stated on page 10 ofProcesses and Procedures of Passing a Law in Parliament: The National Assembly’. When a Bill is introduced, one should not only focus on the purpose of the Bill, but also focus on the implications -- the financial implications, how it would affect the other areas of the department, and whether the drafters had over- or under-estimated the costs or benefits.

When a Committee decides on a problem and wants to introduce a certain Bill, S73 allows for it to introduce it in the National Assembly. A Committee Bill needs to ensure it gets permission from the National Assembly by taking a memo of the proposed legislation, and an explanation of the objects of the legislation. The view of the executive must be expressed in the memo, and the financial implications considered. After the Bill is drafted, the memo of the summary of the Bill would be drafted in consultation with the Parliamentary legal services or other legal services to ensure the draft would contain a legal opinion, classification of what type of Bill it was, and the certificate must be there. The Bill must ensure the relevant department had been given enough time to comment on the draft legislation, and the public had been given three weeks to look at the draft legislation. When Parliament was passing any Bill, the public must be involved, and this was one of the ways which was provided for in the constitution. The Bill must be published in the government gazette and the National Assembly table must assist the Committee in this regard.

There would be an invitation for interested parties to submit representations. The Bill would then be submitted to the Speaker, who would refer the Bill to the Committee. The presentation, instead of going for a first reading, now had a second reading, and if the Bill was introduced by a Committee, the Committee would deliberate on the Bill, and draft the Bill. This allowed the Bill not to be introduced to the National Assembly for decisions, but would go straight to the National Assembly where it would be debated, and decisions would be made.

A department must prepare a draft Bill and a memo on the socio-economic impact assessment when introducing a Bill. This needs to be done before approval by Cabinet. After approval by Cabinet, it must go to the state law advisor for certification and classification, and thereafter must be published, and the public must be involved. Once all these requirements were fulfilled, then the Bill would come to the Speaker’s desk, and the Speaker would refer the Bill to the relevant portfolio Committee. The Bills office would look at the draft to see if mistakes existed and all the legislative requirements had been met, and then there would be a first reading which would be done by the Minister, who would introduce the Bill before Parliament. When the Bill was being introduced in the National Assembly, Parliament would need to identify whether it was a s74, s76 or s77 Bill, and this was done in Parliament through the joint tagging mechanism. A joint tagging committee sits down and decides on the classification of the Bill, and the process was called ‘tagging’.

Tagging determines the procedures for a Bill to become a law, and helps Parliament decide on those procedures – whether it should go to the NCOP or the National Assembly, or the submission of notice of the first reading when a Bill is introduced by a Cabinet Minister or a National Assembly Member of Parliament. When it comes to the Committee there is no first reading. When the Committee receives the Bill, the Speaker would note there was a Bill that was with Parliament and the Speaker had referred it to the Committee, and the Committee would invite interested persons to make comments to it via invitations and through the media.

A Bill was signed into law when it was referred to the President after the National Assembly had passed it. The constitution requires that the President must assent to, and sign, the Bill. However, if the President is not happy with the constitutionality of the Bill, he could send it back to the National Assembly, where the President’s consent would be conceded.

If the Bill affects the provinces, the NCOP must participate. If the President does not consent to the Bill, it must be referred to the Constitutional Court on its constitutionality, and if the Bill is decided to be constitutional, then the President must sign it. A Bill signed and consented to by the President would become an Act of Parliament and would be published in the gazette.

An Act takes effect when it is published in the gazette, on the date determined in the Act. The date is determined by the President. Sometimes an Act requires certain actions to be taken by a department. For instance, regulations need to be drafted and included in the Act, and determinations or rules should be made part of the Act before it is implemented. Once the necessary actions have been finalized, the President is approached and requested to put the Act into operation on a certain date. After the President had assented to implementation of the Act, a proclamation is published in the government gazette, and the Act comes into effect.

This is how Parliament processes a Bill overall, and the Committee is expected to participate, especially when the Bill comes to Parliament.


A Member asked for clarity on s75 Bills affecting the provinces, commenting that the NCOP played a limited role in the Bills which did not affect provinces.

Ms K Tlhomelang (ANC) asked if there were processes to make inputs into executive Bills without facilitating public participation.

The Chairperson advised Members to empower themselves by looking at the Legacy Report which featured past presentations by this research team, and other relevant material. She referred to the time it took to process legislation, with red tape delaying serious issues affecting society. What could the Committee do in the meantime? Without changing certain things timeously, entrepreneurs, and businesses were dying.

Mr H Kruger (DA) states pressure must be put on the Department to bring the Small Business Act forward, since it had promised to bring it forward for the past six years, as well as the Ombudsman, but it had never happened.

Department’s response

Ms Mbelekane said the NCOP could only make amendments, but these could be rejected by the National Assembly, since the different Houses had different powers and responsibilities. The National Assembly gets these powers from the constitution, due to the different Houses having different expectations. The constitution and rules book explain more on this.

She said research conducted by the Parliamentary Monitoring Group (PMG) had found that from introduction to adoption, legislation took an average of 183 days to process, but it would depend on the particular Committee how long it would take be adopted. To push the Bill through, scheduling must take place.

The Chairperson said she needed to about the timeframes so the Committee could put them in place and make demands on departments to push Bills through for adoption.

Prof C Msimang (IFP) referred to the differences between big and small businesses’ charters. His main fear was that this Committee would not meet its target in the National Development Plan (NDP), and a boost must be provided. In Namibia, there was a compulsory charter, so the small businesses had breathing space. Why was this type of charter not compulsory in South Africa? There was a need to make some provisions in the charter compulsory.

Mr Kruger said that when the Bill went to the NCOP, and they took it for public participation, and any problems identified would come back to Committee and not the National Assembly, which could fix the problems. The process was made longer by the Committee.

Mr Z Mbhele (DA) commented on the timeframes for the processes, and said that technical Bills involved quick corrections, his own experience was that going clause by clause was a lengthy process.

Ms Mbelekane said a Bill lapsed if it went from the National Assembly to the NCOP. If the NCOP rejected a Bill passed by the National Assembly, it was referred to the mediation committee. A two-thirds majority in the Assembly was needed to pass the Bill.

Prof Msimang suggested that the scarcity of Bills from private Members and Committees could be due to a fear to embark on the process, since it was considered the “holy ground” for the Cabinet. The late Dr Mario Ambrosini eventually had to take Parliament to court to have his Bill passed into law.

Mr Kruger commented that in the past, if an opposition Member put forward a private Member’s Bill, it would be wiped off the table due to political interference. The Ombudsman Bill could be pushed through more quickly, since it was a well-researched Bill, and it would be a ‘cut and paste exercise.’

The Chairperson responded that the executive was working on the Bill, and this would be duplicating the work. She said Members also needed to have less fear, since they had authority and the barriers between the parties should be removed, as they were all one in the House of Parliament, with a common mission to bring service delivery to the people.

She called on Minister Patel of the Department of Trade and Industry, to suppress imports to support local business, and added that the Portfolio Committee should be expanded to become the “Small Business Development and Co-Operatives Committee,” and this would lead to greater success. 

The meeting was adjourned.


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