Public Investment Corporation Bill: hearings

Meeting report

FINANCE AD HOC COMMITTEE
22 June 2004
PUBLIC INVESTMENT CORPORATION BILL: HEARINGS

Chairperson: Ms B Hogan

Documents handed out
University of Stellenbosch Business School presentation
Financial Services Board - Application of FAIS to PIC (document withdrawn)
Minister's Budget Speech
Public Investment Corporation Bill [B6-04]

SUMMARY
The Financial Services Board looked at the application of the Financial Advisory Intermediary Services Act to the Public Investment Corporation Bill. The submission had to be discontinued halfway for reasons that were not clear to the Committee. The Committee was displeased and said that such kind conduct symbolised disrespect for Parliament.

The University of Stellenbosch Business School focused on the government's ability to set up the Corporation. Given Treasury's track record with other government-linked institutions, it was believed that the Corporation would succeed.

MINUTES
Financial Services Board
Dr F Van Zyl (Financial Services Board - Head: Legislation and Research) briefed the Committee on the application of the Financial Advisory Intermediary Services Act to the Public Investment Corporation (PIC) Bill and the relationship between that Act and this Bill.

Dr Van Zyl indicated certain potential conflicts between the Act and the Bill. For example, the FAIS automatically applies to the PIC and consequently the PIC has to pay a fee in order to be registered as a financial services provider. However, in terms of clause 9(2) of the Bill no fee is payable in respect of the registration of the Corporation as a financial services provider.

After a tea break Dr Van Zyl announced that FSB had instructed him to discontinue the presentation. The Committee was not amused with the developments. The move was strongly condemned. The Chair stated that FSB would be asked to explain why the presentation was stopped.

University of Stellenbosch Business School
Prof N Biekpe (University of Stellenbosch) said that he had not realised that he was supposed to make a submission on the Bill in which he would convey any concerns that he might have on individual clauses. The Committee agreed that this had not been clearly conveyed to him.

He proceeded to provide a background to the Bill and give a history of the Corporation. He then comment on the government's ability, from a financial management viewpoint, to initiate the Corporation. He felt that given the good track record of government-linked institutions such as Eskom and Denel, the Corporation would be a success.

The meeting was adjourned.