Finance bill finally adopted by National Assembly
Bill includes amendments to various pieces of legislation, including a provision to allow for the establishment of state-owned banks
The National Assembly on Wednesday night adopted the Financial Matters Amendment Bill, an omnibus bill amending several pieces of legislation, after the governing ANC managed to ensure a quorum of voting MPs.
This followed the failure of the assembly to adopt the bill on Tuesday night because it was one vote short of a quorum of 201 MPs. Most members of the DA, which opposes one of the bill’s provisions to allow for the establishment of state-owned banks, were intentionally absent from the National Assembly when the vote was taken in order to break the quorum. They did the same on Wednesday night.
The bill includes amendments to the Insolvency Act to provide security for counterparties in over-the-counter derivative transactions in the event of liquidation and ensure that SA complies with internationally accepted requirements. The adoption of the measure was urged by Reserve Bank governor Lesetja Kganyago and the Banking Association SA.
The bill also includes amendments to the Banks Act to allow for the establishment of state-owned banks by state-owned enterprises (SOEs) on certain conditions. The minister of finance in concurrence with the minister responsible for the SOE must approve the application for a banking licence.
The assets of the SOE and those of its holding company and the holding company of the holding company must also exceed its liabilities. They will also have to comply with the conditions of a banking licence applicable to all other banks.
State-owned banks will not be permitted at this stage at provincial and municipal level.
Finance committee chair Yunus Carrim emphasised that an amendment to the Banks Act was necessary to facilitate the licensing of Post Bank.
Amendments were also proposed related to military pensions and the Government Employees Pension Fund, but amendments to the Auditing Profession Act aimed at strengthening the governance and powers of the Independent Regulatory Board of Auditors have not been included.