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Parliament Passes Division of Revenue Bill

June 4, 2021

Parliament

Parliament has passed the 2021 Division of Revenue Bill and sent it to president Ramaphosa for assent.

The bill was tabled in February during Budget 2021.

The bill aims to provide for:


• the equitable division of revenue raised nationally among the national, provincial and local spheres of government for the 2021/22 financial year;
• the determination of each province’s equitable share;
• allocations to provinces, local government and municipalities from national government’s equitable share;
• the responsibilities of all three spheres pursuant to such division and allocations; and
• to provide for matters connected therewith.

Meanwhile, speaking at the Young Women in Business Network Cocktail Dinner, the deputy minister of finance, David Masondo, pointed out that government has undertaken several initiatives in recent years to accelerate financial inclusion and the competitiveness of the South African banking sector.

These include:


• promoting entry into the banking sector;
• creating an enabling framework for co-operative banks;
• creating a framework which enables the licensing of qualifying state-owned banks;
• introducing a deposit insurance framework; and
• taking forward the Financial Sector Charter to foster transformation in the financial services sector and improving access to housing and small business finance.

Reference was also made to the development of South Africa’s Financial Inclusion Policy with the publication of a Draft Policy Paper titled “An Inclusive Financial Sector for All” in October 2020.

The Draft Policy focuses on what needs to be done to deepen financial inclusion of individuals, extend access to financial services for SMMES and facilitate a more diversified provider and distribution base for financial services in South Africa.

According to the deputy minister, the Draft Policy Paper cites extending access to financial services for Small Business as one of the three key pillars of financial inclusion.

In a separate matter, the South African Reserve Bank (SARB), in a statement, announced that the time has come to review potential exit options for its 50% shareholding in African Bank Holdings Limited (ABHL).

The SARB acquired 50% of the issued share capital of ABHL in 2016 as part of the restructuring of ABL.

It adds that it is also time for ABHL to obtain a long-term sustainable shareholder or shareholders who are better aligned to the ABHL’s strategy and growth aspirations.

The SARB pointed out that transaction advisors have been appointed “who are undergoing a process of evaluating various options for the disposal of the 50% stake, including a sale to a strategic investor or investors and an initial public offering (IPO) (although this will be highly dependent on prevailing market conditions at the time). A retail offer or broad-based ownership structure will be considered as part of the process”.

An invitation to interested parties, both local and international, to submit their expression of interest (EOIs) has been extended.