Standing Committee on Finance Chairperson explains process behind adoption of Taxation Laws Amendment Bill
The Chairperson of the Standing Committee on Finance read out the following statement at the beginning of the public hearings on the Taxation Laws Amendment Bill (“Provident Fund Bill”):
“The majority in the Committee welcome the decision by government to seek consensus on the annuitisation aspects of retirement reform and request parliament to consider some amendments to the Bill we passed in November regarding this.
We have to, however, respond to sweeping comments made about the parliamentary, as against the government, processing of the Bill, and we refer in particular to the Report we tabled to Parliament on the Bill on 25 November 2015”
Among the more relevant aspects of the Report include the following:
“The SCOF (Standing Committee on Finance) requested stakeholders and the public to comment on the latest amendments. Written submissions were received and a public hearing was held on 10 November 2015.
The majority of stakeholders supported the amendments. The Chairperson of the Committee also facilitated further engagements outside the formal sittings of SCOF with stakeholders who did not agree with the amendments and National Treasury.
Besides SCOF’s engagement with stakeholders and the public, National Treasury reported to the Committee that they also engaged with stakeholders before and after the Bill was introduced to Parliament. In the case of the retirement reform amendments, these consultations, according to National Treasury, have been taking place since 2012, including through NEDLAC, even though finally there was no agreement in NEDLAC on the tax harmonization and annuitisation amendments. SCOF is unable to tell about the quality and depth of these negotiations, but that there have been negotiations is clear to the Committee.
The Committee did everything possible, under difficult circumstances, to try to get consensus on these amendments, and it deeply regrets that it was not able to. Treasury has provided evidence that those aspects of these amendments that the Congress of South African Trade Unions disagrees with requiring annuitisation will begin to come into effect after five years or more for most workers, and the Committee has amended the Bill to require the Minister to review them through consulting further with stakeholders and reporting back to Parliament by 30 June 2018.
The amendment to clause 3 of the Bill provides that: “ The Minister shall, after consulting relevant stakeholders, review the impact and implementation of paragraphs (k), (l), (o), (p), (q), (r), (t), (u), (v), (w), (x) ,(y) ,(z) and (zC) of clause 3(1). The Minister shall table a report on the review in the National Assembly not later than 30 June 2018.”
Given the levels of indebtedness, the Committee is excruciatingly aware of how strongly workers feel about access to their provident funds and have urged Treasury to embark on a massive campaign to engage with workers and their representatives on these proposals…..
SCOF (the Committee) believes that the Comprehensive Social Security Reform Paper, which has been on the agenda for more than ten years, needs to be finalized as soon as possible and urges government to ensure the paper is published as soon as possible. National Treasury has made it clear that the retirement reform amendments referred to in section 2 above are consistent with the pending Paper.” (Emphasis added)
The Committee did in fact have public hearings, did in fact get a report from National Treasury on the NEDLAC process, did in fact say that we cannot judge the quality of the NEDLAC discussions, and did in fact over further two weeks foster negotiations with parties opposed to annuitisation.
Perhaps the Committee could have done more to ensure public consultation last November, but, unfortunately, not much more. However, we will now do everything we can to foster consensus on the amendments before our Committee.
For media enquiries or interviews with the Chairperson, please contact:
Sureshinee Govender
Tel: 021 403 2239
Cell: 081 704 1109
Email: sgovender@parliament.gov.za
