Department of Trade and Industry
The trade and industry department has called for the revised Draft National Credit Amendment Bill to be published in the Government Gazette for comment.
During a briefing to the portfolio committee on trade and industry, the department added that the revised draft bill needed to be published for comment due to the “material changes that have been made to the Bill since it was initially published.”
The department was providing responses to the submissions received on specific clauses published for comment at the end of May 2018.
In terms of a concern of unintended consequences flowing from clause 12(b) on “reduction of interest and fees”, the department indicated that unintended consequences would be “mitigated by criteria on reductions which will be fair and sustainable.”
The department added that a zero rate is beneficial for credit providers rather than not receiving any payments from consumers.
As regards the possible conflict of interest in the National Credit Regulator (NCR) undertaking debt intervention, the department declared that no conflict of interest would arise as the NCR would not be deciding but rather processing and recommending at no cost to the consumer.
Commenting on clause 29 (a) on “funding of financial literacy”, the department responded that it was “not in support of the proposal to burden over-indebted consumers further by the imposition of a levy.”
Rather, the levy had to be imposed on credit providers.
In response to concerns raised on clause 29 (b) on the minister adjusting gross income and maximum debt, the department pointed out that the minister will “undertake the necessary research, consider relevant factors and consult the credit industry in the formulation of regulations contemplated herein.”
Meanwhile, Advocate Charmaine van der Merwe, Parliamentary Senior Legal Advisor, also provided feedback on a legal opinion on the draft bill submitted by Adv Trengove.
Adv van der Merwe recommended that the clause empowering the Minister to prescribe a debt intervention measure be removed from the draft bill.
She also indicated that adequate consultation on the specific clauses took place.