ATC140327: Report of the Select Committee on Finance on its activities undertaken during the 4th Parliament (May 2009 – March 2014), dated 25 March 2014
NCOP Finance
Report of the Select
Committee on Finance on its activities undertaken during the 4th Parliament
(May 2009 March 2014), dated 25 March 2014
1.
Introduction
1.1
Department/s and
Entities falling within the Committees portfolio
National Treasury
The
National Treasury is responsible for managing South Africas national
government finances. The Department supports efficient and sustainable public
financial management, which is fundamental to the promotion of economic
development, good governance, social progress and raising the standard of
living for all South Africans. The Constitution of the Republic of South Africa
(Chapter 13) mandates the National Treasury to ensure transparency,
accountability and sound financial controls in the management of public
finances.
The
National Treasurys legislative mandate is also described in Chapter 2 of the
Public Finance Management Act. In the PFMA, the National Treasury is mandated
to promote governments fiscal policy framework; to coordinate macroeconomic policy
and intergovernmental financial relations; to manage the budget preparation
process; to facilitate the Division of Revenue Act, which provides for an
equitable distribution of nationally raised revenue between national,
provincial and local government and to monitor the implementation of provincial
budgets.
Entities
|
Name of Entity
|
Mandate of Entity
|
|
South African
Revenue Services
|
The South African Revenue Service Act 34 of 1997,
gives
SARS the
mandate to perform the following tasks:
·
Collect all revenues that are
due;
·
Ensure maximum compliance with
the legislation; and
·
Provide a customs service that
will maximise revenue collection, protect our borders and facilitate trade.
|
|
Financial and Fiscal Commission
|
The Commission derives its
mandate from Chapter 13 of the Constitution of the Republic of South Africa
Act No. 108 of 1996 as amended. Sections 220, 221 and 222 as well as related
Sections 214(2), 219(5), 228(2)(b), 229(5), 230(2), 230A(2) and 230A(2)
provide among others that the Commission is an independent, objective,
impartial and unbiased advisory institution that has to be consulted by
Government with regard to division of revenue among the three spheres of
government and in the enactment of legislation pertaining to provincial
taxes, municipal fiscal powers and functions, and provincial and municipal
loans.
|
|
South African Reserve Bank
|
The Reserve Bank is required to
achieve and maintain price stability in the interest of balanced and
sustainable economic growth in South Africa;
The achievement of price
stability is quantified by the setting of an inflation target by Government
that serves as a yardstick against which price stability is measured;
The achievement of price
stability is underpinned by the stability of the financial system and
financial markets. For this reason, the Bank is obliged to actively promote
financial stability as one of the important determinants of financial system
stability;
Currently, sections 223 to 225
of the Constitution of the Republic of South Africa, 1996, the South African
Reserve Bank Act, 1989 as amended and the regulations framed in terms of this
Act, provide the enabling framework for the Bank's operations. The Bank has a
considerable degree of autonomy in the execution of its duties.
In terms of section 224 of the
Constitution, 1996, "the South African Reserve Bank, in pursuit
of its primary object, must perform its functions independently and
without fear, favour or prejudice, but there must be regular consultation
between the Bank and the Cabinet member responsible for national
financial matters." The independence and autonomy of the Bank
are therefore entrenched in the Constitution;
The Bank has been entrusted
with the overarching monetary policy goal of containing inflation.
The Bank can use any instruments of monetary policy at its disposal to
achieve this monetary policy goal. This implies that the Bank has
instrument independence in monetary policy implementation but not goal
independence in the selection of a monetary policy goal;
The Governor of the Bank holds
regular discussions with the Minister of Finance and meets periodically with
members of the Parliamentary Portfolio and Select Committees on Finance. In
terms of section 32 of the South African Reserve Bank Act, 1989, the Bank
publishes a monthly statement of its assets and liabilities and submits its
Annual Report to Parliament. The Bank is therefore ultimately accountable to
Parliament.
|
|
Financial Services Board
|
The Financial Services
Board (FSB) was constituted by the Financial Services Board Act, 97 of 1990
(the Act). The functions of the board are:
financial
services;
The FSB is a unique,
independent institution established by statute to oversee the South African
non-banking financial services industry in the public interest. The FSBs
mission is to promote sound and efficient financial institutions and services
together with mechanisms for investor protection in the markets we supervise.
The Executive Officer of
the FSB is the Registrar of Pension Funds, Registrar of Friendly Societies,
Registrar of Long-Term Insurance, Registrar of Short-Term Insurance,
Registrar of Stock Exchanges, Registrar of Financial Markets, Registrar of
Collective Investment Schemes and the Registrar of Financial Services
Providers.
Of importance is that the
FSBs purpose is to serve the public interest, not the private interests of
market participants.
|
|
Financial Intelligence Centre
|
To establish and maintain an effective policy and compliance
framework and operational capacity to oversee compliance and to provide high
quality, timeous financial intelligence.
|
|
Development Bank of Southern Africa
|
The Development Bank of
Southern Africa (DBSA)s role, powers, functions and duties are defined by
the Development Bank of Southern Africa Act, 1997.
These are published in the
Government Gazette No17962 Vol. 382 on 25 April 1997 No 641.
The DBSA is registered as a
company in terms of the Companies Act, 1973, but is exempt from the
provisions of the Companies Act, 1973 (Act 61 of 1973).
The Minister may, by notice in
the Gazette, apply any provision of the Companies Act, 1973, the Banks Act,
1990, or such other law to the Bank, in so far as such provision is not
inconsistent with the provisions of the Development Bank of Southern Africa
Act, 1997 (Act 13 of 1997) with such modifications as the Minister may deem
fit and may specify in that notice, and may withdraw or amend any such
notice.
|
|
Auditor-General
|
The Auditor-General has a
constitutional mandate and, as the Supreme Audit Institution (SAI) of South
Africa, it exists to strengthen our countrys
democracy by enabling oversight,
accountability and governance in the public sector, thereby building public
confidence.
|
|
South African Local Government
Association
|
SALGA
is
a listed public
entity, established in terms of Section 21 of the Companies Act, 1973 (Act 61
of 1973), and recognised by the Minister of Cooperative Governance and
Traditional Affairs in terms of the
Organised Local Government Act, 1997 (Act 52 of 1997)
.
SALGA
represents local government on numerous intergovernmental forums such as the
PCC, Minister and MECs (MinMec) forum, the Budget Forum, the
National Council of Provinces (NCOP)
and the
Financial and Fiscal Commission
.
SALGA aims,
among other things, to:
·
Transform local government to
enable it to fulfil its developmental role;
·
Enhance the role of provincial
local government associations as provincial representatives and consultative
bodies on local government;
·
Raise the profile of local
government;
·
Ensure full participation of
women in local government;
·
Act as the national employers
organisation for municipal and provincial member employers;
·
Provide legal assistance to its
members, using its discretion in connection with matters that affect employee
relations.
SALGA is
funded through a combination of sources, including a national government
grant, membership fees from provincial and local government associations that
are voluntary members, and donations from the donor community for specific
projects.
|
|
Land Bank
|
The mandate of the Land Bank is agricultural development.
This makes the Bank different from other
banks and financial institutions in that it lends money for farming,
processing and marketing in South Africa. The Bank's mandate enables it to
offer special development programmes and strategies which include:
|
|
Municipalities
|
The mandate of the municipality, as contained in section 152 of
the Constitution, is:
These policy statements guide the formulation and implementation
of the integrated development plan and every decision and action of the
municipality.
|
1.2
Functions of the
Committee
Parliamentary committees are mandated to:
·
Monitor the financial and non-financial
performance of government departments and their entities to ensure that
national objectives are met.
·
Process and pass legislation.
·
Facilitate public participation in Parliament
relating to issues of oversight and legislation.
The Select Committee on Finance was established in terms of Section 4(1)
of the Money Bills Amendment Procedure and Related Matters Act, No. 9 of 2009.
In terms of Section 4(2) of this Act, the Committee has powers and functions
conferred to it by the Constitution, legislation, the standing rules or a
resolution of a House, including considering and reporting on:
·
The
national macro-economic and fiscal policy;
·
Amendments
to the fiscal framework, revised fiscal framework and revenue proposals and
Bills;
·
Actual
revenue published by the National Treasury; and
·
Any other
related matter set out in this Act.
The mandate further encompasses the Committees
function to legislate, conduct oversight on the Executive actions; facilitate
public participation, facilitate international agreements, and review matters
of public interest in relation to the National Treasury and its entities and
the South African Reserve Bank.
1.3
Method of work of the
Committee
The Committee
conducted oversight visits to engage with identified municipalities together
with the national and provincial departments on the following issues: development
and implementation of municipalities budgets; compliance with the Municipal
Finance Management Act (MFMA); spending and performance of municipalities with
regards to conditional grants; the relations and collaboration between the
municipalities and various national and provincial departments (including
parastatals); service delivery and capacity constraints of the municipalities;
and the alignment of municipalities Integrated Development Programmes with the
Provincial Growth and Development Strategy.
The
stakeholders invited to participate in the meetings during the oversight visits
included the National and Provincial Departments of Cooperative Governance; the
National and Provincial Treasuries; South African Local Government Association
(SALGA); the Department of Energy; Financial and Fiscal Commission (FFC); the Department
of Water and Environmental Affairs; the Office of the Auditor-General; the Development
Bank of Southern Africa and Eskom, the MECs for Finance, and Provincial Finance
Committees in the Legislatures.
The Select
Committee on Finance had facilitated public participation through public
hearings held in Parliament with the stakeholders. The Committee also invited
submissions from the general public through the media. These submissions were
then considered, assessed, adopted and tabled. Some of the stakeholders that
the Committee engaged with during public hearings are the Manufacturing Circle,
Business Unity South Africa (BUSA); Earth Life Africa; Financial and Fiscal
Commission (FFC); South African Institute of Tax (SAIT); National Union of
Metalworkers South Africa (NUMSA); Federation of Unions of Southern Africa
(FEDUSA); South African Institute of Chartered Accountants (SAICA) and
Pricewaterhouse Coopers (PwC). These stakeholders made submissions with regards
to the fiscal framework and revenue proposals.
The Cabinet in terms of section 100 (2) (a) of the Constitution, resolved
that some Ministers will resume responsibility for relevant functions of the
Provincial Executive of the Limpopo Province, in terms of section 100 (1) (b)
of the Constitution.
During the period
of the intervention,
members of the NCOP that serve on the Select
Committees on Finance, Appropriations, Social Services, Education and Public
Services
visited the Province (on three occasions) to
engage with the leadership of the departments placed under administration. The
Administrators for each of the departments under intervention were appointed
and were tasked with developing action plans.
The
Select Committee on Finance compiled an oversight report based on the
observations and findings made during the interactions with different
stakeholders. The Committee tabled three oversight reports (with
recommendations) in Parliament. Key amongst the recommendations was the
decision to review the intervention regularly (quarterly).
Section
100 (2) (c) of the Constitution provides for the NCOP to, whilst an
intervention continues, review the intervention regularly and make
recommendations to the National Executive.
The Committee dealt with the legislation
referred to it in terms of the requirements of the Money Bills Act, the
Constitution and the Standing Rules of the National Council of Provinces. The
specific legislation that the Committee had dealt with is discussed in the
report.
1.4
Purpose of the report
The purpose of this report is to provide an
account of the Select Committee on Finances work during the 4
th
Parliament and to inform the Members of the new Parliament of key outstanding
issues pertaining to the oversight and legislative programme of the National
Treasury and its entities.
This report provides an overview of the
activities that the Committee undertook during the 4
th
Parliament,
the outcomes of key activities, the challenges that emerged during the period
under review and issues that should be considered for follow up during the 5
th
Parliament. It summarises the key issues for follow-up and make recommendations
to strengthen operational and procedural processes to enhance the Committees
oversight and legislative roles in future.
2.
Key statistics
The table below provides an overview of the
number of meetings held, legislation and international agreements processed and
the number of oversight trips and study tours undertaken by the Committee, as
well as statutory appointments the Committee made, during the 4
th
Parliament.
|
Activity
|
2009/10
|
2010/11
|
2011/12
|
2012/13
|
2013/14
|
Total
|
|
Meetings held
|
48
|
34
|
23
|
20
|
33
|
158
|
|
Legislation processed
|
5
|
3
|
4
|
5
|
12
|
28
|
|
Oversight trips undertaken
|
2
|
2
|
5
|
1
|
1
|
11
|
|
Study tours undertaken
|
0
|
0
|
0
|
0
|
0
|
0
|
|
International agreements processed
|
4
|
14
|
3
|
10
|
0
|
31
|
|
Statutory appointments made
|
0
|
0
|
0
|
0
|
1
|
1
|
|
Interventions considered
|
0
|
0
|
1
|
0
|
0
|
1
|
|
Petitions considered
|
0
|
0
|
0
|
0
|
0
|
0
|
3.
Legislation
The following pieces of legislation were referred to the Committee and
processed during the 4
th
Parliament:
|
Year
|
Name of Legislation
|
Tagging
|
Objectives
|
Completed/Not Completed
|
|
2009/10
|
Appropriation Bill
[B5 2009]
|
Section 77
|
To appropriate
money from the National Revenue Fund for the requirements of the State for
the 2009/10 financial year; to prescribe conditions for the spending of funds
withdrawn for the 2010/11 financial year before the commencement of the
Appropriation Act for the 2010/11 financial year;
and to provide for matters incidental
thereto.
|
Completed
|
|
|
Adjustments Appropriation Bill
[B13 2009]
|
Section 77
|
To effect adjustments to the appropriation of
money from the National Revenue Fund for the requirements of the State in
respect of the 2009/10 financial year; and to provide for matters incidental
thereto.
|
Completed
|
|
|
Western Cape Inherited Debt Relief Bill
[B6-2009]
|
|
To authorise the
discharge of certain debts of the former Cape Provincial Administration and
the former House of Representatives, which have devolved upon the Western
Cape Province in terms of the Constitution of the Republic of South Africa,
1993, and are still outstanding; to make arrangements for the settling of
accounts in relation to the debts; and to provide for matters incidental
thereto.
|
Completed
|
|
|
Taxation Laws Second Amendment Bill
[B11-2009]
|
Section 75
|
To provide for
the allocation of payments; amend the Transfer Duty Act, 1949, so as to
extend a time period;
|
Completed
|
|
|
Taxation
Laws Amendment Bill [B10-2009]
|
Section 77
|
To amend the
Transfer Duty Act, 1949, so as to amend a definition; to make a new
provision; to provide for an exemption; to effect consequential amendments;
amend the Estate Duty Act, 1955, so as to make further provision for a
deduction; amend the Income Tax Act, 1962, so as to fix the rates of normal
tax and amend monetary amounts; to amend and insert certain definitions; to
effect technical corrections; to repeal certain provisions; to amend certain
provisions; to make a new provision; to effect textual and consequential
|
Completed
|
|
|
|
|
|
|
|
2010/11
|
South African Reserve Bank Amendment Bill
[B10-2010]
|
Section 75
|
To amend the South African Reserve Bank Act, 1989
(Act No. 90 of 1989) (the Act) in order to achieve the following
objectives: To stop shareholders of the South African Reserve Bank (the Bank)
from circumventing the Act's current limitation of a maximum of 10 000 shares
per shareholder; to allow for the nomination of directors by a broader base
of the South African public and to broaden representation on the Board of the
Bank (the Board); to provide for the establishment of a Panel for the
election of directors; to define clear criteria regarding when persons are
disqualified from serving on the Board; to provide for the confirmation of
Board nominees against fit and proper and fiduciary criteria; to clarify
the powers and functions of the Board, which will primarily be those of
governance, with all remaining powers and duties of the Bank as set out in
section 10 of the Act being vested in and being exercised by the Governor and
Deputy Governors; and to provide for the possibility of the Governor and
Deputy Governors to be re-appointed to serve a term of less than five years.
|
Completed
|
|
|
Voluntary Disclosure Programme and Taxation Laws Second
Amendment Bill
[B 29 2010]
|
Section 75
|
To introduce a voluntary disclosure programme;
amend the Transfer Duty Act, 1949, so as to provide for electronic submission
of returns and electronic payment of duty; amend the Income Tax Act, 1962, so
as to amend certain provisions; amend the Unemployment Insurance
Contributions Act, 2002, so as to effect a technical correction; amend the
Mineral and Petroleum Resources Royalty (Administration) Act, 2008, so as to
amend certain provisions; and provide for matters connected therewith.
|
Completed
|
|
|
Taxation Laws Amendment Bill
[B 28
2010]
|
Section 77
|
To amend the Transfer Duty Act, 1949, so as to
amend a provision; amend the Income Tax Act, 1962, so as to amend, delete and
insert certain definitions; to effect technical corrections; to repeal
certain provisions; to amend certain provisions; to make new provision; and
to effect textual and consequential amendments; amend the Customs and Excise
Act, 1964, so as to amend provisions; and to make provision for
continuations; amend the Income Tax Act, 1990, so as to effect technical
corrections; amend the Value-Added Tax Act, 1991, so as to amend certain
provisions; amend the Unemployment Insurance Contributions Act, 2002, so as
to amend a provision; amend the Securities Transfer Tax Act, 2007, so as to
amend certain provisions; and to effect a consequential amendment; amend the
Revenue Laws Amendment Act, 2008, so as to effect technical corrections;
amend the Taxation Laws Amendment Act, 2009, so as to effect technical corrections;
amend the Taxation Laws Amendment Act, 2010, so as to repeal a
provision; and to effect technical corrections;
amend the Taxation Laws Amendment Act, 2011, so as repeal a provision; and to
effect technical corrections; and to provide for matters connected therewith.
|
Completed
|
|
|
|
|
|
|
|
2011/12
|
Tax Administration Bill
[B11-2011]
|
Section 75
|
To provide for
the effective and efficient collection of tax; to provide for the alignment
of the administration provisions of tax Acts and the consolidation of the
provisions into one piece of legislation to the extent practically possible.
|
Completed
|
|
|
Taxation Laws Amendment Bill
[B19 -
2011]
|
Section 77
|
To amend the
Transfer Duty Act, 1949, so as to amend and delete certain definitions; to
modify rates and thresholds; to make new provision; and to effect textual and
consequential amendments.
|
Completed
|
|
|
Taxation Laws Second Amendment Bill
[B20-2011]
|
Section 75
|
To amend the
Income Tax Act, 1962, so as to amend certain provisions; amend the Customs
and Excise Act, 1964, so as to amend certain provisions; to make additional
provision for disclosure of information; to broaden the scope of a provision;
and to make provision for continuations; and to provide for matters connected
therewith.
|
Completed
|
|
|
Government Employees Pension Law Amendment Bill
[B15-2011]
|
Section 75
|
To amend the
Government Employees Pension Law, 1996, so as to amend a definition and
insert a definition; to provide for the payment of a pension interest to a
former spouse of a member on divorce or the dissolution of a customary marriage;
to amend the powers of the Board to make rules; to amend the provisions
providing for the recognition of pensionable service of former members of
non-statutory forces or services; and to provide for matters connected
therewith.
|
Completed
|
|
|
|
|
|
|
|
2012/13
|
Credit Rating Services Bill
[B8-2012]
|
Section 75
|
To provide for the registration of credit rating
agencies; provide for the regulation of certain activities of credit rating
agencies; provide conditions for the issuing of credit ratings and rules on
the organisation and conduct of credit rating agencies; and to provide
matters connected therewith.
|
Completed
|
|
|
Financial Markets Bill
[B12-2012]
|
Section 75
|
To provide for the regulation of financial
markets; license and regulate exchanges, central securities depositories,
clearing houses and trade repositories; regulate and control securities
trading and the custody and administration of securities; prohibit insider
trading and other market abuses; provide for the approval of nominees; provide
for codes of conduct; replace the Securities Services Act, 2004, as amended
by the Financial Services Laws General Amendment Act, 2008, so as to align
this Act with international standards; and to provide for matters connected
therewith.
|
Completed
|
|
|
Rates and Monetary Amounts and Amendment of Revenue Laws Bill [
B10 - 2012]
|
Section 77
|
To fix the rates of normal tax; amend the Income
Tax Act, 1962, so as to amend rates and monetary amounts; amend the Customs
and Excise Act, 1964, so as to amend rates of duty in Schedule 1; and to
provide for matters connected therewith.
|
Completed
|
|
|
Tax Administration Laws Amendment Bill
[B35-2012]
|
Section 75
|
To make a provision for the enactment of an
international agreement into law; insert a provision providing for the application
of the Tax Administration Act, 2011, to certain matters relating to customs
and excise; amend the Estate Duty Act, 1955, so as to effect a consequential amendment;
amend the Income Tax Act, 1962, so as to effect textual amendments; to amend
certain provisions; to insert new provisions and to effect
consequential amendments; amend the Customs and
Excise Act, 1964, so as to amend a provision; amend the Value-Added Tax Act,
1991, so as to amend a provision and to insert a new provision; amend the Unemployment
Insurance Contributions Act, 2002, so as to effect a textual amendment; amend
the Mineral and Petroleum Resources Royalty (Administration) Act, 2008, so as
to insert certain provisions; amend the Taxation Laws Second Amendment Act,
2009, so as to repeal a provision; amend the Taxation Laws Second Amendment
Act, 2011, so as to postpone an effective date; amend the Tax Administration
Act, 2011, so as to effect technical corrections, to regulate tax
practitioners; and to provide for matters connected therewith.
|
Completed
|
|
|
Taxation Laws Amendment Bill
[B34 - 2012]
|
Section 77
|
To amend the Transfer Duty Act, 1949, so as to
amend a provision; amend the Income Tax Act, 1962, so as to amend, delete and
insert certain definitions; to effect technical corrections; to repeal
certain provisions; to amend certain provisions; to make new provision; and
to effect textual and consequential amendments; amend the Customs and Excise
Act, 1964, so as to amend provisions; and to make provision for
continuations; amend the Income Tax Act, 1990, so as to effect technical
corrections; amend the Value-Added Tax Act, 1991, so as to amend certain
provisions; amend the Unemployment Insurance Contributions Act, 2002, so as
to amend a provision; amend the Securities Transfer Tax Act, 2007, so as to
amend certain provisions; and to effect a consequential amendment; amend the
Revenue Laws Amendment Act, 2008, so as to effect technical corrections;
amend the Taxation Laws Amendment Act, 2009, so as to effect technical corrections;
amend the Taxation Laws Amendment Act, 2010, so as to repeal a provision; and
to effect technical corrections; amend the Taxation Laws Amendment Act, 2011,
so as repeal a provision; and to effect technical corrections; and to provide
for matters connected therewith.
|
Completed
|
|
|
|
|
|
|
|
2013/14
|
Merchant Shipping (International Oil
Pollution Compensation Fund) Administration Bill
[B42 2013]
|
Section 75
|
To provide for administrative matters in
connection with the levy imposed in terms of the Merchant Shipping
(International Oil Pollution Compensation Fund) Contributions Act, 2013; and
to provide for matters connected therewith.
|
Completed
|
|
|
Merchant Shipping (International Oil
Pollution Compensation Fund) Contributions Bill
[B41 2013]
|
Section 77
|
To provide for the imposition of the
International Oil Pollution Compensation Fund Contributions Levy on persons
referred to in Article 10 of the 1992 Fund Convention; to provide for the
manner in which the levy is determined; to provide that levies and interest
due to be paid to the International Oil Pollution Compensation Fund are a
direct charge against the National Revenue Fund; and to provide for matters
connected therewith.
|
Completed
|
|
|
Banks Amendment Bill
[B43-2012]
|
Section 75
|
To amend the Banks Act, 1990, so as to
define certain expressions and to amend certain definitions; to
bring certain provisions in line with their practical application; to update
references to legislation and institutions; to extend the use of the name
bank to representative offices; to provide that a contravention of the Financial
Intelligence Centre Act, 2001, is a cause for suspension or cancellation of registration
as a bank; to align the Banks Act, 1990, with the Companies Act, 2008; and to
comply further with the requirements of the Basel Committee of Banking Supervision;
and to provide for matters connected therewith.
|
Completed
|
|
|
Rates and Monetary Amounts and Amendment of Revenue Laws Bill
[B12 - 2013]
|
Section 77
|
To fix the rates of normal tax; to amend
the Income Tax Act, 1962, so as to amend rates and monetary amounts; to amend
the Customs and Excise Act, 1964, so as to amend rates of duty in Schedule 1;
and to provide for matters connected therewith.
|
Completed
|
|
|
Financial Services Laws General Amendment Bill [
B29-2012]
|
Section 75
|
To
amend and update the Pension Funds Act, 1956, the South African Reserve Bank
Act, 1989, the Financial Services Board Act, 1990, the Long-term Insurance Act,
1998, the Short-term Insurance Act, 1998, the Inspection of Financial Institutions
Act, 1998, the Financial Institutions (Protection of Funds) Act, 2001, the
Financial Advisory and Intermediary Services Act, 2002, the Collective Investment
Schemes Control Act, 2002, the Co-operative Banks Act, 2007, and the Financial
Services Laws General Amendment Act, 2008, in order to close regulatory gaps,
to effect improvements to certain provisions, to provide for increased
supervisory capabilities, to rationalise and align the supervisory functions
afforded to the Registrar; and to align the aforementioned Acts with the Companies
Act, 2008; to amend the National Payment System Act, 1998, the Medical
Schemes Act, 1998, and the Co-operatives Act, 2005, to the extent that those
laws impact on the stability of the financial services sector and
impede on a holistic regulatory approach and effective supervision; and to
provide for matters connected therewith.
|
Completed
|
|
|
Employment Tax Incentive Bill
[B46 -
2013]
|
Section 77
|
To provide for an employment tax incentive in the
form of an amount by which employees tax may be reduced; to allow for a
claim and payment of an amount where employees tax cannot be reduced; and to
provide for matters connected therewith.
|
Completed
|
|
|
Tax Administration Laws Amendment Bill
[B40-2013]
|
Section 75
|
To amend the Transfer Duty Act,
1949, so as to effect consequential amendments; amend the Income Tax Act,
1962, so as to effect textual and consequential amendments; to amend
provisions; and to effect technical corrections; amend the Customs and Excise
Act, 1964, so as to amend a provision; to make a new provision; and to amend
provisions; amend the Value-Added Tax Act, 1991, so as to effect technical
corrections; amend the Skills Development Levies Act, 1999, so as to make a
new provision; and to effect consequential amendments; amend the Unemployment
Insurance Contributions Act, 2002, so as to make a new provision; and to
effect consequential amendments;
amend
the Securities Transfer Tax Act, 2007, so as to effect consequential amendments;
amend the Mineral and Petroleum Resources Royalty Act, 2008, so as to effect consequential
amendments; amend the Mineral and Petroleum Resources Royalty
(Administration) Act, 2008, so as to effect a technical correction; amend the
Tax Administration Act, 2011, so as to amend certain provisions; to effect
technical corrections; and to effect textual and consequential amendments; and
to provide for matters connected therewith.
|
Completed
|
|
|
Taxation Laws Amendment Bill [
B39 -
2013]
|
Section 77
|
To amend the Transfer Duty Act, 1949, so as to
amend provisions; amend the Estate Duty Act, 1955, so as to amend a
provision; amend the Income Tax Act, 1962, so as to amend, delete and insert
certain definitions; to effect technical corrections; to repeal certain
provisions; to amend certain provisions; to make new provision; and to effect
textual and consequential amendments;
amend the Customs and Excise Act, 1964, so
as to amend provisions; and to make provision for continuations;
amend the Value-Added Tax Act, 1991, so as
to amend certain provisions; repeal the Demutualisation Levy Act, 1998; amend
the Securities Transfer Tax Act, 2007, so as to amend a provision; amend the
Mineral and Petroleum Resources Royalty Act, 2008, so as to amend certain
provisions; and to amend Schedules; amend the Taxation Laws Amendment Act,
2011, so as to amend certain provisions; amend the Taxation Laws Amendment
Act, 2012, so as to amend certain provisions; and to effect technical
corrections; make provision for special zero-rating in respect of goods and
services supplied in certain circumstances; and to provide for matters
connected therewith.
|
Completed
|
|
|
Customs and Excise Amendment Bill
[B44B
2013]
|
Section 75
|
To amend the Customs and Excise Act, 1964, so as
to delete all provisions superseded by general provisions of the Customs
Control Act applicable to all tax levying Acts; to delete all provisions
relating to the customs control of imported goods and goods to be exported;
to delete all provisions relating to the imposition, collection and refunding
of customs duties and other matters relating to customs duties; to limit the
remaining provisions of the Act to excise duties, fuel levies, Road Accident
Fund levies, environmental levies, air passenger taxes and matters relating
to such duties, levies and taxes; and to change the name of the Act to the Excise
Duty Act, 1964; and to provide for matters connected therewith.
|
Completed
|
|
|
Customs Control Bill
[B45B
2013]
|
Section 75
|
To provide for customs control of all vessels,
aircraft, trains, vehicles, goods and persons entering or leaving the
Republic; to facilitate the implementation of certain laws levying taxes on
goods and of other legislation applicable to such goods and persons; and for
matters incidental thereto.
|
Completed
|
|
|
Customs Duty Bill
[B43
2013]
|
Section 77
|
To provide for the imposition, assessment,
payment and recovery of customs duties on goods imported or exported from the
Republic; and for matters incidental thereto.
|
Completed
|
|
|
Financial Management of Parliament Amendment Bill
[B1 2014]
|
Section
76
|
To amend the Financial Management of Parliament Act, 2009 so as to
insert further definitions; to deal with the financial management of
provincial legislatures; to amend the provisions dealing with the oversight
mechanism; to amend provisions dealing with Parliaments annual budget,
appropriations and approvals; to amend the provisions dealing with donor
funds; to delete certain provisions dealing with Parliaments own revenue
sources; to align the provisions dealing with reporting and auditing with the
Public Finance Management Act, 1999; to repeal certain sections of the Powers
and Privileges Act, 1963; to delete certain references to provincial
legislatures in the Public Finance Management Act, 1999; to include
references to performance management; to amend the long title; and to provide
for matters connected therewith.
|
Completed (on 25 March 2014)
|
Challenges
encountered
The following challenges emerged during the processing of legislation:
·
The National Assembly takes long to process Section
76 legislation. This puts pressure on the National Council of Provinces and its
Committees to meet the six weeks cycle deadline; and
·
Some of the gaps in
the Money Bills Act are the tight timeframes and lack of sanctions for
non-compliance with the Act by the Committees.
Issues for follow-up
The 5
th
Parliament should consider following up on the
following concerns that arose:
·
Section 76 legislation should be tabled in the
National Council of Provinces, allowing more time for Committees to go through
the six weeks cycle when processing it; and
·
The Committee should
coordinate with the Standing Committee on Finance and the National Assembly to
fas- track the process of reviewing the Money Bills Amendment Procedure and
Related Matters Act, No. 9 of 2009, in order to address some of the existing
gaps that may prevent effective implementation of the Act.
4.
Oversight trips
undertaken
The following oversight trips were undertaken:
|
Date
|
Area Visited
|
Objective
|
Status of Report
|
|
21 23 September 2009
|
Mpumalanga
|
To monitor and evaluate coordination
pertaining to the provision of municipal services and support given to
municipalities
|
Adopted
|
|
02 04 March 2010
|
Northern Cape
|
To monitor and evaluate coordination
pertaining to the provision of municipal services and support given to
municipalities
|
|
|
20 23 July 2010
|
North West
|
To monitor and evaluate coordination
pertaining to the provision of municipal services and support given to
municipalities
|
Adopted
|
|
15 16 September 2010
|
Gauteng, Pretoria
|
Oversight visit to the South African
Reserve Bank
|
No report required
|
|
25 29 July 2011
|
Limpopo
|
NCOP Follow-up
visit to Limpopo Province, to monitor progress made on the issues raised
during Taking Parliament to the People.
|
|
|
16 19 August 2011
|
Free State
|
Due to the outcomes of the Auditor-Generals
report on municipalities, the Committee resolved to conduct an oversight
visit in order for municipalities to fast-track service delivery.
|
Adopted
|
|
10 14 October 2011
|
North West
|
The Committee conducted a follow-up visit
to the municipalities it had visited in the North West Province during 20
23 July 2010, and planned to monitor progress made by the sector departments
in assisting the struggling municipalities.
|
Adopted
|
|
24 27 January 2012
|
Northern Cape
|
The
Committee conducted a follow-up visit to the municipalities it had visited in
the Province of the Northern Cape during 2 4 March 2010, and plans to monitor
progress made by the sector departments in assisting the struggling
municipalities
|
Adopted
|
|
25 30 March 2012
|
Limpopo
|
To
engage with five Limpopo departments in terms of section 100 (2) (c) of the
Constitution of the Republic of South Africa, 1996.
|
Adopted
|
|
01 05 October 2012
|
Limpopo
|
To
engage with five Limpopo departments in terms of section 100 (2) (c) of the
Constitution of the Republic of South Africa, 1996.
|
Adopted
|
|
22 26 April 2013
|
Limpopo
|
Review
of the Limpopo intervention in terms of section 100 (2) c of the Constitution
of the Republic of South Africa.
|
Adopted
|
Challenges
encountered
The following challenges emerged during the oversight
visits:
·
Too many municipalities were invited, limiting time for the Committee to
sufficiently engage with all the municipalities;
·
General non-compliance with legislation and regulations
by municipalities, particularly with the
governance, financial
management, administration and service delivery;
·
Cash flow problems in most municipalities,
reflecting poor planning and budgeting. Municipal budgets were also not
credible;
-
There
was an increasing trend in outstanding creditors in most municipalities,
revenue collection rate was too low even in
municipalities
that had the potential to collect more
;
-
Municipalities
were still heavily reliant on consultants to perform financial functions, whereas
there were officials employed to carry out those functions;
-
Inconsistent
revenue collection; the billing system required urgent attention;
-
Non-compliance
with supply chain management regulations was identified as the cause of
most of the irregularities reported;
-
The
support provided by the provincial certain provincial departments of
Cooperative Governance and Traditional Affairs (COGTA) with regard to
financial assistance, was of concern to the Committee in terms of the
legality thereof;
-
Inadequate
and ineffective support by the provincial CoGTAs to ailing municipalities;
-
The
municipalities owed huge amounts of money to Eskom and these debts could
become unmanageable if not addressed on time;
-
SALGA
was not executing its mandate effectively in terms of capacitating
municipalities;
-
Section
139 interventions were ineffective given that the municipalities under
administration could still not submit financial statements for auditing
and relied heavily on consultants to perform services of the CFO;
-
Municipalities
did not have clear plans to address issues raised by the AG, to move
towards clean audit by 2014 and also failed to implement the Committee on
Public Accounts resolutions.
Issues for follow-up
The 5
th
Parliament should consider following up on the
following concerns that arose:
·
During oversight visits, the Committee should consider partnering the
best performing municipalities with the under-performing ones in a province in
order to share best practices;
·
The Committee should strengthen its oversight over municipalities and conduct
on-site visits;
-
The
Committee should regularly invite SALGA, COGTA and other relevant
stakeholders to account in Parliament, with respect to the support given
to municipalities; and
-
The
Committee should continue to regularly monitor and evaluate finances of
provinces and municipalities.
5.
Study tours
undertaken
No study tours were undertaken due to time
constraints and Parliamentary Programmes /activities. The Committee should
consider conducting study tours and budget sufficiently for these tours.
6.
International
Agreements and Protocols
The following international
agreements were processed and reported on:
|
Date referred
|
Name of Agreement
|
Objective
|
Status of Report
|
|
16 September 2009
|
Agreement between the Republic
of South Africa and the United Mexican States
|
Avoidance of Double Taxation
and the Prevention of Fiscal Evasion with respect to Taxes on Income
|
Adopted
|
|
16 September 2009
|
Agreement between the Republic
of South Africa and the Federal Republic of Germany
|
Avoidance of Double Taxation with respect to Taxes
on Income and on Capital
|
Adopted
|
|
11 August 2010
|
Protocol
amending the Convention between the Government of the Republic of South
Africa and the Government of Ireland
|
Avoidance
of double taxation and the prevention of fiscal evasion with respect to taxes
on income and capital gains, with protocol
|
Adopted
|
|
11 August 2010
|
Protocol
amending the Convention between the Republic of South Africa and the Kingdom
of Sweden
|
Avoidance
of double taxation and the prevention of fiscal evasion with respect to taxes
on income
|
Adopted
|
|
18 April 2011
|
Protocol
between the Government of the Republic of South Africa and the Government of
the United Kingdom of Great Britain and Northern Ireland
|
To amend the Convention for the Avoidance
of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes
on Income and on Capital Gains
|
Adopted
|
|
18 April 2011
|
Agreement
between the Government of the Republic of South Africa and the Government of
the Republic of Kenya
|
Avoidance
of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes
on Income
|
Adopted
|
|
23 August 2011
|
Agreement
on the establishment of the African Tax Administration Forum
|
Establishment
of the African Tax
Administration
Forum
|
Adopted
|
|
19 October 2011
|
Agreement between the Government of the
Republic of South Africa and the Government of Bermuda for the exchange of
information relating to tax matters
|
Exchange
of information relating to tax matters
|
Adopted
|
|
19 October 2011
|
Protocol and additional protocol amending
the convention between the Republic of South Africa and the Republic of
Austria
|
Avoidance
of Double Taxation with respect to taxes on income and capital, signed on 4
March 1996
|
Adopted
|
|
19 October 2011
|
Agreement between the Republic of South
Africa and the Government of the Commonwealth of the Bahamas
|
Exchange
of information relating to tax matters
|
Adopted
|
|
19 October 2011
|
Agreement between the Government of the
Republic of South Africa and the Government of the Republic of San Marino
|
Exchange
of information relating to tax matters
|
Adopted
|
|
19 October 2011
|
Agreement between the Government of the
Republic of South Africa and the Government of Jersey
|
Exchange
of information with respect to taxes
|
Adopted
|
|
19 October 2011
|
Protocol Amending the Agreement between the
Government of the Republic of Seychelles and the Government of the Republic
of South Africa
|
Avoidance
of Double Taxation and the prevention of fiscal evasion with respect to taxes
on income
|
Adopted
|
|
19 October 2011
|
Agreement between the Government of the
Republic of South Africa and the Government of the States of Guernsey
|
Exchange
of information relating to tax matters
|
Adopted
|
|
19 October 2011
|
Agreement between the Government of the
Republic of South Africa and the Government of the Cayman Islands
|
Exchange
of information relating to tax matters
|
Adopted
|
|
19 October 2011
|
Protocol Amending the Agreement between the
Government of the Republic of South Africa and the Government of Malaysia
|
Avoidance
of Double Taxation and the prevention of fiscal evasion with respect to taxes
on income, signed at Pretoria on 26 July 2005
|
Adopted
|
|
15 February 2011
|
Protocol
between the Government of the Republic of South Africa and the Government of
the United Kingdom of Great Britain and Northern Ireland
|
To
Amend the Convention for the Avoidance of Double Taxation and the Prevention
of Fiscal Evasion with respect to Taxes on Income and on Capital Gains
|
Adopted
|
|
15 February 2011
|
Agreement
between the Government of the Republic of South Africa and the Government of
the Republic of Kenya
|
Avoidance
of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes
on Income
|
Adopted
|
|
31 May 2012
|
Agreement
between the Government of the Republic of South Africa and the Government of
Gibraltar
|
Exchange
of information relating to tax matters
|
Adopted
|
|
31 May 2012
|
Agreement
between the Government of the Republic of South Africa and the Government of
the Commonwealth of Dominica
|
Exchange
of information with respect to taxes and tax matters
|
Adopted
|
|
31 May 2012
|
Agreement
between the Government of the Republic of South Africa and the Government of
the Republic of Liberia
|
Exchange
of information relating to tax matters
|
Adopted
|
|
12June 2013
|
Convention on
Mutual Administrative Assistance in Tax matters as amended by the 2011
protocol
|
Convention
on Mutual Administrative Assistance in Tax Matters
|
Adopted
|
|
04June 2013
|
Agreement
between the Government of the Republic of South Africa and the Government
of the Republic of Botswana
|
Avoidance of
Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on
Income with Protocol
|
Adopted
|
|
04 July 2013
|
Convention between the Republic of South Africa
and the Republic of Chile
|
Avoidance of Double Taxation and the Prevention
of Fiscal Evasion with respect to taxes on income and on capital
|
Adopted
|
|
04 July 2013
|
Agreement
between the Government of the Republic of South Africa and the Government of
the Republic of Costa Rica
|
Exchange of
information relating to tax matters
|
Adopted
|
|
04 July 2013
|
Protocol
Amending the Agreement between the Government of the Republic of South Africa
and the Government of the Republic of Malta
|
Avoidance of
Double Taxation and the Prevention of Fiscal Evasion with respect to taxes on
income signed at Rome on 16 May 1997
|
Adopted
|
|
04 June 2013
|
Agreement
between the Government of the Republic of South Africa and the Government of
the Republic of Mauritius
|
Avoidance of
Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on
Income
|
Adopted
|
|
04 July 2013
|
Agreement
between the Government of the Republic of South Africa and the Government of
Samoa
|
Exchange of
information relating to tax matters
|
Adopted
|
|
12 June 2013
|
Supplementary
Protocol Amending the Agreement between the Government of the Republic of
South Africa and the Government of the Sultanate of Oman
|
Avoidance of
Double Taxation and the Prevention of Fiscal Evasion with respect to taxes on
income
|
Adopted
|
|
04 July 2013
|
Protocol Amending the Convention between the
Republic of South Africa and the Kingdom of Norway
|
Avoidance of Double Taxation and the Prevention of
Fiscal Evasion with respect to taxes on income
|
Adopted
|
|
10 September 2013
|
Agreement between the Government of the Republic of South Africa and
the Government of the Republic of Mozambique
|
Implementation of one-stop border posts (Combined Border Control Posts
on the Mozambique-South Africa Border)
|
Adopted
|
Challenges
The following challenges emerged during the
processing of international agreements:
-
Submission
of draft international agreements by the National Treasury to Parliament did
not allow sufficient time for assessment;
and
·
Expiry of the terms of the agreements
occurring at the same time put pressure on the Committee.
Issues for follow-up
The 5
th
Parliament should consider
following up on the following concern that arose:
-
The
Committee should be afforded adequate time to scrutinise and assess
international agreements in order to make informed decisions and make
recommendations.
7.
Statutory
appointments
In terms of section 15 (1) of the Money Bills
Amendment Procedure and Related Matters Act, No. 9 of 2009,
There is
hereby established a Parliamentary Budget Office headed by a Director, the main
objective of which is to provide independent, objective and professional advice
and analysis to Parliament on matters related to the budget and other money
bills.
|
Date
|
Type of appointment
|
Period of appointment
|
Status of Report
|
|
09 May 2014
|
Director Parliamentary Budget Office
|
Five years
|
Adopted by the House
|
8.
Interventions
The following intervention was referred to and processed by the
committee:
|
Title
|
Date referred
|
Current status
|
|
Notice
of intervention issued in terms of section 100 (1) (b) of the Constitution,
1996, to the Departments of Basic Education; Treasury; Health; Transport and
Public Works in the Province of Limpopo.
|
14 December 2011
|
Completed
|
Challenges
encountered
The following challenges were experienced during the process of the
intervention:
·
Lack of clarification of roles
and responsibilities impacted negatively on the implementation of the
intervention;
·
The scope of the intervention did
not have timeframes, action plans, exit strategies, review periods and service
delivery plans;
-
Lack
of effective ongoing and regular communication and cooperation within all
stakeholders;
-
Guidelines
were not developed and presented at the time that the national executive
placed the Province or departments under administration;
-
Administrators
of some departments changed regularly;
·
Lack of sufficient skills (key senior
positions filled) with qualified competent people to support the provincial
departments and their entities; and
·
Inadequate measures in place to monitor and
provide technical support and training to the provincial departments and
entities.
Issues for follow-up
The 5
th
Parliament should consider following up on the
following concerns that arose:
-
The
Committee should follow up on the implementation of recommendations made;
·
The Committee should review the Section 100
interventions regularly, preferably quarterly. This could be done through
meetings and oversight visits including site visits; and
·
The Committee should
follow up with the Minister of Cooperative Governance and Traditional Affairs
to consider introducing national legislation to regulate the process of an
intervention in line with the provisions of section 100 (3) of the
Constitution, 1996.
9.
Petitions
No petitions were
referred to the Committee during the fourth Parliament.
10.
Obligations conferred
on Committee by legislation:
In terms of Section 4(2) of the
Money Bills Amendment Procedure and Related
Matters Act, No. 9 of 2009
, the
Committee has powers and functions conferred to it by the Constitution,
legislation, the standing rules or a resolution of a House, including
considering and reporting on:
·
The national
macro-economic and fiscal policy;
·
Amendments
to the fiscal framework, revised fiscal framework and revenue proposals and
Bills;
·
Actual
revenue published by the National Treasury; and
·
Any other
related matter set out in this Act.
The mandate further encompasses the Committees
function to legislate, conduct oversight on the Executive actions; facilitate
public participation, facilitate international agreements, and review matters
of public interest in relation to the National Treasury and its entities, and
the South African Reserve Bank.
11.
Recommendations
·
The Committee should strengthen and enhance
partnerships with internal and external stakeholders such as the Parliamentary
Budget Office, Financial and Fiscal Commission, the National Treasury and others;
·
The
Committee should continue the quarterly interactions with the provincial
treasuries and
use the third quarter 2013/14 provincial treasuries budget and
expenditure report as a basis to continue the provincial work done by the
Committee;
·
The
Committee should i
mprove enforcement of legislation
such as the PFMA, MFMA and any other
relevant finance related legislation in the provinces and municipalities in
terms of service delivery; and
·
The
Committee should prioritise oversight over the municipalities that the 4
th
Parliament Committee could not visit due to time constraints.
Documents
No related documents