Parliament has passed the Appropriation Bill and sent it to president Ramaphosa for assent.
The bill was tabled in parliament in February during Budget 2021.
The national assembly gave the green light to the bill earlier this month and sent it to the national council of provinces for concurrence.
The Appropriation Bill aims to:
• appropriate money from the National Revenue Fund for the requirements of the State for the 2021/22 financial year;
• prescribe conditions for the spending of funds withdrawn for the 2022/23 financial year before the commencement of the Appropriation Act for the 2022/23 financial year; and
• provide for matters incidental thereto.
Parliament has also passed the Special Appropriation Bill, tabled during Budget 2021, and sent it to the president.
The Special Appropriation Bill aims to:
• appropriate an additional amount of money to votes of Health and Social Development;
• effect an adjustment to an appropriation of money to the vote of Public Enterprises; and
• provide for matters connected therewith.
R1.25 billion is allocated to the health department to procure COVID-19 vaccines and implement a related COVID-19 vaccine research project; R2.826 billion is allocated to the social development department in order to fund the extension of the Special COVID-19 Social Relief of Distress Grant and allocations to the public enterprises department are adjusted to assist SAA subsidiaries with urgent funding needs.
Meanwhile, national treasury recently briefed the select committee on finance on the Financial Sector Laws Amendment Bill.
The bill was tabled in parliament in August 2020.
In an earlier statement, treasury indicated that the bill is “part of the Twin Peaks reform of the financial regulatory system applicable to the financial sector”.
Cabinet approved the bill in June 2020 for tabling in parliament.
In its statement, cabinet pointed out that the bill proposes to designate the Reserve Bank (SARB) as the Resolution Authority and strengthens the SARB’s regulatory tools designed to ensure stability of the financial system.
The proposed legislation also aims to introduce South Africa’s first comprehensive deposit insurance scheme that will ensure that depositors are paid their funds when a bank fails.
Some of the acts to be amended include the Insolvency Act, the South African Reserve Bank Act, the Banks Act, the Mutual Banks Act, the Competition Act, the Financial Markets Act, the Insurance Act and the Financial Sector Regulation Act.
Amendments are proposed to the Insolvency Act to clarify that the provisions of the Financial Sector Regulation Act of 2017 apply to the liquidation or sequestration of the estate of a designated institution; to exclude dispositions made in case of resolution from the application of the Insolvency Act and to clarify and refine the application of certain provisions of the Insolvency Act.
Proposed amendments to the Competition Act of 1998 aim to exclude transactions in relation to resolution from the application of certain provisions; and to provide for consultation with the Competition Commission in relation to certain transactions.
Proposed amendments to the Financial Sector Regulation Act of 2017 aim to provide for the establishment of a framework for the resolution of designated institutions to ensure that the impact or potential impact of a failure of a designated institution on financial stability is managed appropriately; to designate the Reserve Bank as the resolution authority; to establish a deposit insurance scheme, including a Corporation for Deposit Insurance and a Deposit Insurance Fund; to provide for co-ordination, co-operation, collaboration and consultation between the Corporation for Deposit Insurance and other entities in relation to financial stability and the functions of those entities; to make provision for designated institutions in connection with resolution matters; to further provide for information required to assess a levy; to effect consequential and technical amendments to certain provisions and to accordingly amend the long title and the Arrangement of Sections.
In the briefing, treasury highlighted key proposals in the bill including enhancing the Reserve Bank’s financial stability mandate and expanding its objective for depositor protection; stabilisation powers to include bail-in, transfer of certain assets and liabilities as well as the creation of bridge institutions; Resolution Authority (i.e. Reserve Bank) to be responsible for the development of resolution plans for all designated institutions and safeguards to include a new proposed creditor hierarchy and adherence to the ‘no creditor worse off’ principle.