2. Briefing

The Committee was briefed on the purpose and content of the Bill by the Department officials and a workshop for all Members of the Provincial Legislature was also organized to give members more insight into the Bill.

3. Consultation

The Committee considered the scope of consultation on the Bill and resolved as follows:

• Due; to the nature of the Bill, the Committee felt that there is a need to conduct public hearings.

• Public hearings on the Bill were therefore conducted.

4.Concerns

The Committee does not have any major concerns on the Bill and support the purpose and spirit of the Bill.

The committee having considered the Bill resolved that die following mandate be conferred:

(a) To support the principles, objectives and substance of the Bill.

(b) To propose for the following amendments:

• The definitions are to a large extent unclear and axe characterized by cross referencing more than giving meaning that is intended to be attached to the particular words. In this regard see the definition of the words, inspector, credit agreement, credit facility, consumer court, credit bureau and credit regulator. It is proposed that the above words should be clearly defined. To give an example) the word, credit agreement, should be defined to reflect the relationship between the consumer and the credit provider.

• Although the word, consumer, is clearly defined, the use of the word, party, in the definition may be problematic as it is not clear whether it refers to both natural and juristic person or not. This definition should therefore be reworked to reflect both natural and juristic person. The same applies to the definition of credit provider.

• The use of the word, all in the definition of credit agreement may be problematic as it presupposes that before an agreement is regarded as a credit agreement it should comply with all the requirements in section 8 which is not necessarily correct as an agreement which satisfies some of the requirements in section 8 may be a credit agreement. An agreement can be a credit agreement if it satisfies the requirements section S(3) or 8(4) only.

• Notwithstanding the provisions of section IS, it is proposed that the Bill must provide for the establishment of a dedicated consumer education, advice and information services. This will also ease pressure from the National Credit Regulator and will ensure that consumers are more informed as this institution will be dedicated to this only

• Alternatively it is proposed that National Consumer Advice Offices be established through which research based programs can be developed to enhance public education and advice.

• It is further proposed that the role of provincial government must be clear with regard to the functioning of the institutions created in the Bill,

• It is strongly proposed that there should be a once off amnesty for all the people who are already blacklisted.

• A farther obligation should be added to credit grantors to enquire from the consumer whether the contract should be explained to him or her and if the consumer wishes, the whole contract should be explained.

• It is proposed that the services of the debt counselors should be free of charge as most people who will be in need of this service might be highly indebted. Debt counselors can be financed by a public fund with the mandatory contributions from registered credit grantors.

• Fees charged by debt collectors should also be regulated.

• Although section 25 makes provision for the appointment of inspectors the functions for those inspectors are not immediately reflected and it is therefore proposed that the functions of the inspectors be reflected in one section and more preferably under section 25.

• The existence of provincial regulators may create problems as each may prescribe certain norms and standards for its province and this may be undesirable and confusing for people operating in various provinces.

• It is further proposed that all people operating business of providing credit should be registered as opposed to the threshold provided for in section 40.

• It is further proposed that section 36 be amended to require that when the copy of the report is transmitted to the Premier, then the Premier must table it in the Provincial Legislature.

(c) That Honorable P Masualle, be. designated as a Special Delegate to attend a meeting on Negotiating Mandates on behalf of the Eastern Cape Province.