The Committee met to deliberate on the legal opinions provided by the Western Cape Provincial Parliament’s Legal Advisor and the Premier’s State Law Advisor in respect of the matter arising from the deliberations on the submissions received on the Western Cape’s Gambling and Racing Amendment Bill [B1 – 2020].
Legal opinions had been requested from the Western Cape Provincial Parliament (WCPP) through Adv Romeo Maasdorp and the Department of the Premier State Law through Advisor Ms Astrid Muller. Members were reminded to not take the verbal presentations as the official legal opinions but rather to consider the written documents provided as the official legal opinions.
After discussions amongst Members and the present delegates, a consensus was reached that an external legal practitioner should be consulted in order to investigate the constitutionality issues which had been raised as well as the rationality aspect of the Bill. This was as a result of two contrasting arguments which arose from the discussions. The external legal opinion would help guide the Committee in making well informed decisions and exhausting all available resources when confusion still occurred after internal opinion had been sought. The external opinion could even delve deeper than what the internal opinion had and would allow the Committee to evaluate what external legal practitioners thought of the Bill.
The Chairperson welcomed Members and the delegation to the meeting. The focus would be on the legal opinions provided by the Western Cape Provincial Parliament’s Legal Advisor and the Premier’s State Law Advisor in respect of the matter arising from the deliberations on the submissions received on the Western Cape’s Gambling and Racing Amendment Bill [B1 2020]. The rules of engagement of the meeting were explained, thereafter followed by introductions and received apologies.
The Chairperson explained that there had been some concerns from stakeholders regarding the constitutionality of the objective of the Bill which related to the industry paying for itself and whether some stakeholders such as casinos and Limited Payout Machines (LPM) operators would be bearing the bulk of the costs.
Legal opinions had been requested from the Western Cape Provincial Parliament Legal Advisor and the Department of the Premier.
Adv Romeo Maasdorp, Western Cape Provincial Parliament Legal Advisor, took the Committee through his legal opinion.
Ms Astrid Muller, Department of the Premier, State Law Advisor, took the Committee through her legal opinion.
The Chairperson thanked Adv Maasdorp and Ms Muller for their presentations. Members were reminded to not take the verbal presentations as the official legal opinions but rather to consider the written documents provided as the official legal opinions. The verbal presentations were a medium of explanation and summary of the official legal opinions.
Ms N Nkondlo (ANC) asked on what the law was in terms of the principle of rationality. She stated that she failed to understand the logic that Adv Maasdorp was trying to explain in justifying that everyone be on the same equal basis because of the principle of rationality.
The application of differentiation should be allowed according because of the economic context. She used the example of the law of tax; where the amount of tax people paid differentiated based on the income people received. The logic that Adv Maasdorp was using would then imply that tax law was irrational.
Adv Maasdorp responded that the issue of rationality, as quoted from a Constitutional Court case, in his legal opinion stated that the requirement of rationality was not the exact test for whether legislation was fair, reasonable or appropriate nor was it aimed at deciding whether there were better means which could be used. To ask Parliament to pass the Bill would be to accept that they would be passing a law which could carry a vast burden of financial obligations on some in the industry. Simply put, he believed there ought to be a measure used to obtain an objective for the public good.
The example of the taxpayer’s differentiation was a good illustration, as the taxpayer block was a differentiation per income bracket. However, the issue at hand would be one where people within that same income bracket would be treated differently when applied to the current context. Differentiation, which had no rational basis, could have had policy reasons but it stood on its own two feet and was predicated by policy. The law itself had to pass constitutional scrutiny and therefore could not differentiate arbitrarily.
The point which encapsulated the essence and underlying value that he was trying to achieve was that all persons should to be treated equally before the law without discrimination.
Ms Muller responded that from the comments received by the National Gaming Board (NGB), the concern was that the operator fees would be the costs paid to the site operators. As she had previously explained, that would not be the case as the charges would be paid by the route operators and that there was no getting over the costs to the site operators, therefore, the issue had been addressed.
In response to her statement on the Bill not being arbitrary, she mentioned that as Provincial Treasury had previously explained, there were good reasons as to why the Department could not charge the totalisators and bookmakers. The totalisators were in a difficult position and the industry itself was in decline, as such it would not be sensible to link the sustainability of the Board to such an industry. The bookmakers, within the context of their environment, had been shown that they were a high flight risk and once again it would not be sensible to link the Board’s sustainability to such an industry.
Due to the nature of the industries, the Department could not charge them at that stage so there was an actual link between what the government was trying to achieve – which was to make the industry and Board financially self-sufficient. Charging totalisators and bookmakers posed the real risk of undermining the very thing which was achievable by only charging casinos and LPMs. Hence, she believed that the differentiation was rational, referring back to the example of the tax law. She emphasized that nowhere in her opinion had she stated that the legislation was fair, reasonable or even appropriate as that had not been the concern. The concern was to check whether there was a link between what government was trying to achieve and the differentiation; concluding that just as the Department had explained, there had indeed been a rational link and the differentiation had not been arbitrary.
Mr Anthony Phillips, Acting DDG: Fiscal and Economic Services, Western Cape Provincial Treasury, responded that each province had its own gambling legislation and unfortunately that gambling legislation had also differentiated between the same players within a specific province. In other words, the country had a monopoly around casinos as well as the LPM industries. Those operators operated in different provinces and were subject to different taxation as well as gambling laws. The amendment sought to address the issue around the regulation and self-sustainability of the Board from an economic and fiscal perspective. All provincial and national departments of government had been severely hit with regard to its revenue or income, with the point being that all of them had to make difficult decisions; asking as to what made the industry so different when it had to make difficult decisions when it came to it regulating itself.
Ms Nkondlo mentioned that the Department of Economic Development could assist the Committee with an indication of the regulatory environment in the different economic sectors. Their input would help shed light on the application of differentiations across economic sectors and whilst it may not have been about the fees, the mere principle of how it was applied could help the Committee in reaching an understanding. Despite hearing what Adv Maasdorp said, she struggled to grapple with the application of it when contrasting to norms where differentiation occurred daily within the economic sectors – referring back to the tax law example.
Adv Maasdorp responded that he truly appreciated the input by Members. However, he stated that what he meant was that the differentiation between the fee payers and those who had been excluded was arbitrary. It was a direct result of the exclusion not being founded but rather inexpedient in the sense that it had not included or considered the inclusion or payment of fees by other players. He clarified that it had been one driven by necessity and not by principle.
Explaining that in his written opinion, he had stated that Treasury was labouring under a self-imposed imperative which they had created in the context they sought to use as prediction for the Bill. He accepted what had been said by Mr Phillips and rightly agreed that indeed Mr Phillips response had been correct. He emphasized that Treasury had been labouring under a self-imposed imperative and the only remedy for the Bill would be to include everyone and proportion the application for payment. By doing so, the payment could not be labelled as irrational or outside of the law.
Ms Muller responded that the operators did not have to be treated equally, all that was needed was to show that there was a link between what government was trying to achieve and the way in which the operators were treated differently.
The Chairperson said that she believed the topic had been exhausted and Members needed to deliberate on the way forward.
Mr D Mitchell (DA) stated for the record as a proviso that whilst he was mindful and valued the legal opinions received from both legal practitioners, he proposed that the Committee Chairperson writes to the Speaker in order to seek a third legal opinion.
The Chairperson agreed with the proposal by Mr Mitchell, elaborating further that as a Committee they needed to satisfy themselves in order to make the correct decision based on law and concrete understanding of it. As such, the Chairperson said that seeking an impartial legal opinion on the matter would only help to add better understanding to the knowledge of the Committee, especially since the Committee had to decide on the matter.
Adv Maasdorp responded that firstly, he hoped the Chairperson meant that there would be a preference to obtain an ‘external’ rather than an ‘impartial’ legal opinion as he believed that all opinions, especially ones emanating from himself were independent or impartial and only motivated by what the law dictated and facts conjured. Secondly, he stated that he was not sure if it would be wise for the Committee to seek another opinion as an opinion was just that – an opinion. At what point according to him, would the Committee satisfy themselves before reaching a decision. A majority opinion did not necessarily mean that the opinion was correct as there were many instances where the minority opinion was actually more legally based in law than the majority.
The Chairperson apologised and corrected the use of the word impartial to external for the third opinion sought. What had been meant was that an external opinion be sought from outside the walls of the WCPP in order to get deeper understanding and knowledge of the varying legal viewpoints.
Ms Makamba-Botya (EFF) stated that she wished to express her gross disappointment in the manner in which the Committee operated when a majority of Members in the Committee did as they pleased when it suited them and their agenda or when they were dissatisfied with the legal advice they received within the parameters of the legislature. She gave an example of where legal advice had previously been sought from Adv Maasdorp and some of the Members had not been satisfied with the manner in which the matter was dealt with, despite that there had been no third-party legal advice sought or mentioned by the Committee. She failed to understand why Members were being afforded the opportunity now to seek external legal advice when there had been legal advice already sought from two legal practitioners within the parameters of the legislature who gave two contrasting directives to allow the Committee to make informed decisions.
Ms Nkondlo highlighted that she was in support of getting an external opinion. Currently, there had been two contrasting arguments. The external legal opinion would only help guide the Committee and herself in making well informed decisions and exhausting all available resources when confusion still occurred after internal opinion had been sought. The external opinion could even delve deeper than what the internal opinion had and would allow the Committee to evaluate what external legal practitioners thought of the Bill.
Mr A Van der Westhuizen (DA) stated that he supported the notion by Ms Nkondlo that an external legal practitioner be consulted, who could drill deeper in terms of the constitutionality issues which had been raised as well as the rationality aspect of the Bill.
The Chairperson said that even if the Committee was to get a third legal opinion, it did not necessarily mean that the Committee would agree with the third legal opinion which would obviously be based on the information or reasons which would be put forward. Despite the Chairpersons honesty of leaning more towards one side when considering the environment and size of particular industry players, etc. she sought not to dispute one opinion or another.
She agreed with Mr Mitchell that a third opinion be sought in order for the Committee to see what reasons the third party would put forward as to why or why not they supported the differentiation and whether or not the differentiation would or would not be constitutional. As such, she supported Mr Mitchells request to write to the Speakers Office requesting for an external legal opinion. The reason being that it was the Speaker who represented the WCPP and if the Bill landed in Court there needed to be a surety that the Committee had exhausted all internal resources before granting its request.
Adv Maasdorp responded that it would be crucial to get a brief to an external legal practitioner so that the salient points which were sufficiently canvassed for the benefit of the Committee, however, to ask for a brief on the general constitutionality of the Bill could be huge requirement as it was a very wide scope.
The brief would have to be on the crucial points and well-articulated as he believed that if the brief was even in a nuanced way different, the Committee could receive a response which would not be sufficiently helpful.
Ms Muller stated that she was satisfied with the proposed approach.
Ms Z Adams, Procedural Officer for the Western Cape Provincial Parliament, stated that regarding the external opinion, there were no rules which guided them but as long as they stuck within the legal realm of what had been asked then it should be okay.
The Chairperson said that a letter would be written to the Speaker requesting an external service provider on the particular matter, however, before the brief was admitted to the external provider; the Chairperson would meet with the Office of the Speaker which would need to include the Legal Department of WCPP, the Procedural Department of the WCPP, a representative from Provincial Treasury and the Legal Department of the Office of the Premier to discuss the matter.
The Chairperson asked if Members agreed on the suggested way forward.
Mr Mitchell, Mr Van der Westhuizen and Ms Nkondlo all agreed.
Ms Makamba-Botya stated that she had no comment.
The Chairperson said that she was comfortable on the proposed way forward and unless there were any specific objections, she took it as though she was mandated to go through with the proposal. She requested that for the time, as members they wait until they have received feedback before scheduling a date for the deliberations.
Members agreed on the proposal.
Other Committee Business
The Chairperson reminded Members of the oversight visit to the Ankerlig Power Station in Atlantis on the 15 October 2020. Members travelling with the WCPP transport were informed to meet at the Dorp Street entrance on the day as the transport would be leaving at 7 am. Members were to bring proof of identity and would need to fill out a screening questionnaire which would be submitted to the security at Ankerlig Power Station before entering the premises. Electronic copies of the questionnaire would be forwarded to Members travelling via private transport who would need to print it out and hand it to the Procedural Officer on the day of the oversight visit. Lastly, Members would undergo the COVID-19 screening protocols on entry to the Ankerlig Power Station where masks and closed flat shoes would need to be worn.
No pictures would be allowed as it posed a safety issue, however, the Chairperson requested for one to be taken on the walk as proof of the oversight visit if allowed. The facility did not have a canteen, and as such extra time had been allocated for lunch at a restaurant which was a drive from the power station.
Mr Van der Westhuizen said that he had been requested to attend a meeting at 8 am. He asked if it would be possible for him to attend his virtual meeting until 9 am in his car or a safe spot at the facility where he could thereafter join the rest of the Members on the oversight visit activities.
Ms Adams said that she had double checked with the logistical unit and if the transport departed at 7 am they were likely to arrive at the facility at 8 am. However, another half an hour had been designated for security checks.
The Chairperson responded to Mr Van der Westhuizen that Ms Adams would be asked to alert security that he would be coming in his own private vehicle and after his virtual meeting had ended, he could join the rest of the Members.
The Chairperson thanked Members for the robust discussion, explaining further that she was confident that their Committee was doing whatever they could to ensure that they were prudent and were working in the best interests of the public.
The meeting was adjourned.
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