Special Pensions Amendment Bill [B29-2008]: hearings & Financial Services Laws General Amendment Bill [B21-2008]: adoption

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Finance Standing Committee

11 June 2008
Chairperson: Mr N Nene (ANC)
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Meeting Summary

The Committee heard oral submissions by representatives from the AZANLA Military Veterans Association, AZAPO, the ANC Veterans League and the Khulumani Support Group on the Special Pensions Amendment Bill.  All four organisations proposed that service in the liberation organisations replaced the age criteria for qualification.  AZANLA MVA, AZAPO and the ANC Veterans League raised objections to the disqualification of applicants if they committed a crime.  Suggestions were made regarding the provision of skills training, medical care benefits, alternative supporting documents, the effective date of benefits payable and the scrapping of cut-off dates for applications.

Members asked questions about the number of members who were active in the organisations, the verification of membership, whether the organisations submitted comments to the original Act, how undeserving persons could be prevented from applying for special pensions and the nature of the training requested.

The Chief Director: Legislation of National Treasury briefed the Committee on amendments to clauses 1 and 13 of the Financial Services Laws General Amendment Bill that was adopted by the Committee on 4 June 2008.  The tabled Bill inadvertently placed unintended restrictions on pension fund payments to testamentary trusts.  The wording of clauses 1 and 13 was amended to address the unintentional omission.

The Committee agreed to the proposed amendments and the Bill was adopted, with amendments.

Meeting report

Special Pensions Amendment Bill
AZANLA Military Veterans Association (AZANLA MVA) submission

Mr George Biya (Deputy Chairperson, AZANLA MVA) presented an overview of the historic factors and current challenges faced by the members of the organisation (see attached document).  Areas of concern in the proposed Bill were the threshold age of 30 as at 1 December 1996, the effective date of 1 April 2001 for the back-payment of benefits, the formulae applied to calculate benefits and the disqualification of candidates who committed crimes after 2 February 1990.

AZANLA MVA recommended that age 25 was the threshold for applicants, that job-guaranteed skills training was provided for candidates under the threshold age, that applicants who committed crimes before 27 April 1994 were not disqualified and that the lump sum payment of benefits were backdated to the date the applicant joined the organisation.

Azanian People’s Organisation (AZAPO) submission
Mr Strike Thokoane (Secretary General, AZAPO) presented the organisation’s comments on the proposed Bill (see attached document).

AZAPO suggested that service rather than age should be used to determine if an applicant qualified for the special pension.  Three years rather than five years of detention should be applied and benefits for all applicants should be backdated to 1996.  The organisation suggested that age 60 rather than 65 was applied for migration.  The amount of pension for surviving spouses was R500.00 per month and was considered to be too low.  The organisation proposed that Schedule 1 of the Criminal Procedure Act was replaced by Schedule 2 in respect of disqualification and withdrawal of the pension if the applicant committed a crime.  Surviving spouses should be allowed to apply for benefits beyond the one year currently provided for in the Act.  The organisation was concerned that candidates would be disqualified if they applied too late.

ANC Veterans League submission
Mr S’khumbuzo Qwabe (KZN Provincial Co-ordinator, ANC Veterans League) presented the organisation’s comments on the proposed Bill (see attached document).

Suggestions included the application of service rather than age to determine qualification for special pensions, the provision of skills and education to those who did not qualify for the pensions, the provision of medical care in addition to burial benefits and that burial benefits were appropriate to the position of the member.  Members who worked at the time should also qualify for special pensions.  The League suggested that letters and affidavits from the ANC were acceptable in lieu of death certificates.

Mr Qwabe commented on the swift arrest of members for committing crimes, particularly in KwaZulu Natal.  He said the organisation had no faith in the South African Police Service (SAPS) in KwaZulu Natal.

Khulumani Support Group submission
Ms NomaRussia Bonase (Co-ordinator, Khulumani Support Group) briefed the Committee on the organisation’s comments on the proposed Bill (see attached document).

Khulumani was actively involved in informing, reaching and assisting potential applicants for special pensions.  The group suggested that the cut-off date for applications was withdrawn, that qualification based on age was replaced by service criteria, that documentary proof of membership of the political organisations was not required and that the special pensions were extended to other victims of human rights violations who were excluded from the TRC processes.  Khulumani requested that a substantial portion of the funds remaining in the President’s Fund was transferred to the group and that Government withdrew its opposition to the Khulumani lawsuit.

Mr B Mnguni (ANC) noted that all the organisations commented on the issue of the qualifying age.  He asked if the organisations could determine how many members were active combatants and how many left the country to study abroad.  He asked how membership of the organisations can be verified.

Mr N Singh (IFP) asked if the organisations had the opportunity to comment on the original Act.  He asked if the organisations experienced any problems with the administration of the Act.  He noted that the ANC Veterans League added oral comments to the written submission.  He remarked that Mr Qwabe’s comments regarding the SAPS in KwaZulu Natal were unfair in the light of developments over the last 14 years of democracy.

Mr S Asiya (ANC) related his own experiences and asked how the organisations proposed to limit everyone from jumping on the bandwagon if the cut-off age for special pensions was not applied.  He asked for clarity on the crimes listed in the schedules to the Criminal Procedure Act.

The Chairperson explained that serious crimes were listed in Schedule 1 to the Criminal Procedure Act.

Mr K Moloto (ANC) asked AZAPO to clarify the comment made during the presentation that the scrapping of the age criteria and reducing the period of detention to three years would not impose more strain on the fiscus.  He remarked that if the restrictions were removed, the result would be to open the floodgates and persons who were as young as 15 at the time, would qualify for pensions.  He said that verification was critical to the credibility of the process and the assistance of the organisations was necessary to prevent undeserving persons from receiving the special pension.  He said that the special pensions were not intended as payment for services rendered but were intended to close the gap where persons were unable to make provision for their own pensions.

Mr M Johnson (ANC) asked AZAPO to clarify if the proposed term of detention of three years was determined as three continuous years in detention or three years in total.  He asked AZAPO to explain the comment that members who were deployed but worked did not contribute to pension funds.  He asked what age group the persons were currently who would receive the suggested job-guaranteed skills training.  He asked how the crimes listed in Schedule 2 differed from those in Schedule 1 to the Criminal Procedure Act.

Mr Biya undertook to advise the Committee on the number of members who belonged to AZANLA MVA.  He said the number of was reducing.  As stakeholders in the process, AZANLA MVA was willing to play an active role in ensuring that deserving persons benefited from the special pensions.  He gave the assurance that the organisation was willing to work with the Department to ensure an effective process.  He admitted the organisation had experienced some faults in the system in the past.  He said that AZANLA MVA did not make a submission on the Act in 1995.

Mr Thokoane explained that he last served on the Special Pensions Board more than a year ago and did not have a conflict in interest in representing AZAPO at the hearing.  In response to a question from the Chairperson, Mr Thokoane confirmed that he served on the board in addition to his position as Secretary-General of AZAPO.  He advised that AZAPO was not invited to comment on the principal Act when it was originally proposed but made submissions on subsequent amendments.

Mr Thokoane told the Committee that many members were recruited at a young age.  He did not consider that there will be substantially more applications if the special pension was based on service rather than on age.  He said that the three year period of detention may be an accumulation of shorter periods spent in detention.  He admitted that there were cases where undeserving persons had received the special pensions and suggested that mechanisms were put in place to prevent such cases in future.  He confirmed Mr Biya’s comment that the number of members were dwindling and advised that the political organisations involved should be in a position to submit lists of their members.

Mr Qwabe explained that the commanders of underground units should be allowed to verify who had served under them.  He said his comment on the SAPS was based on the SAPS’ inability to combat crime in the ANC-dominated areas in KwaZulu Natal.  Members were arrested for crimes during clashes between the IFP and ANC in the province.

Mr Qwabe suggested that skills training included general building and related skills such as plumbing and electrical wiring as well as training in the tourism industry.

The Chairperson commented that the determination of a qualifying age was not an easy decision as there would always be persons who lost out.  He pointed out that the special pensions were not intended to address all the other problems in society, which were more appropriately dealt with elsewhere.

[PMG note: The remainder of the discussion on the submissions was conducted in Xhosa]
Financial Services Laws General Amendment Bill: Briefing by National Treasury
Ms Jo-Ann Ferreira (Chief Director: Legislation, National Treasury) briefed the Committee on the proposed amendments to clauses 1 and 13 of the Financial Services Laws General Amendment Bill (see attached document).

She explained that the amendments to the tabled Bill were necessary to correct the unintentional restrictions placed on testamentary trusts.  The Bill was agreed by the Committee on 4th June 2008.

No questions were asked by Members.

The Chairperson read the Committee’s Report on the Bill.

Members agreed to the proposed amendments to clauses 1 and 13.  The Bill was adopted, with amendments.  Mr Asiya seconded the motion.

The meeting was adjourned.


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