The National Assembly has passed the South African Postbank Limited Amendment Bill on Tuesday, with objections from the Democratic Alliance (DA), Inkatha Freedom Party (IFP), United Democratic Movement (UDM), Freedom Front Plus (FF-Plus), African Christian Democratic Party (ACDP), Economic Freedom Fighters (EFF) and the African Independent Congress (AIC).
The Bill will be sent to the National Council of Provinces (NCOP) for concurrence. The main object of the Bill is to amend the South African Postbank Act to allow the transfer and shareholding of the bank from the South African Post Office (SAPO) to be under the control of the government.
“The Bill seeks to amend the South African Post Bank Limited Act 2010, to amend and insert certain definitions, to further amend the objects of the Act, to facilitate the transfer of shareholding from the South African Post Office SOC Limited, to government and creation of a bank controlling Company BCC, the Post Bank SOC Limited in terms of the Banks Act of 1990, which would provide for the appointment of the Chief Executive Officer and the Chief Financial Officers, and provide for matters connected in addition to that,” says Boyce Maneli, Communications Committee Chairperson.
‘A catastrophe’
DA member of Parliament, Dianne Kohler-Barnard described the Bill as a catastrophe while the UDM Chief Whip, Nqabayomzi Kwankwa says the bank will not have a developmental agenda.
“The Postbank Bill is catastrophic. It is generally accepted that the only reason this move has been made is that it was announced in 2017 that the ANC insisted that government established a state bank. That was a week after the Postbank filed its application for a commercial banking license with the Reserve Bank and the ANC gave the Reserve Bank six months to achieve this,” says Kohler-Barnard.
Kwankwa advanced the UDM’s reasons why it is not supporting the Bill.
“The United Democratic Movement does not support the South African Postbank Limited Amendment Bill. You know previous speakers spoke about you guys being a great pretender. This is pretense because what you need indeed is a developmental bank, a state bank that has a developmental agenda. And why I am saying that you have already cited that there is going to be no equity injection in this thing,” says Kwankwa.
The EFF believes that the governing party’s current leadership is not in favour of a state bank.
“The South African Postbank Limited Amendment Bill is before the House today, is only possible because the EFF introduced the Banks Amendment Bill. Before the introduction of the Banks Amendment Bill as a Private Members Bill, state-owned companies were not permitted to apply for a fully fleshed banking license. We know that the ANC does not believe in interfering in the business of White Monopoly Capital, and does not believe in empowering a Black government to stand on its own. We know that the idea of a state bank goes against anything that the current ANC Leadership believes in,” EFF MP Yolisa Yako explains.
The IFP’s Zandile Majozi says the Postbank should not be established as a separate entity.
“As the IFP we do not support the establishment of a Postbank as a separate entity and state bank. The committee while considering this Bill raised concern about the lack of internal controls at Postbank. A lack of performance at the entity and whether Post bank without the SASSA rollout, would it be able to maintain itself and what other contracts it seeks to attract. Overall the committee raised the matter of lack of performance and worrisome budget spending and expenditure by the Postbank, they have not displayed the necessary growth of full confidence of becoming a separate entity from the Post Office and becoming a state bank” says Majozi.
Wouter Wessels from the FF-Plus believes that the bank will be a liability in already tough economic times.
“In 2019 even prior to the disastrous effects COVID-19 and high stages of load shedding have had on South Africa’s economy and finances, the National Treasury said that the establishment of such a state-owned bank will be a massive liability that the country can’t afford such,” says Wessels.
‘Not convinced’
ACDP Deputy leader, Wayne Thring says while the party is not oblivious to the marginalised who are excluded from the benefits of the banking sector, especially in rural areas, the ACDP is not convinced that a state bank may be the solution.
“The idea that the solution to the problem of the economically marginalized and disenfranchised in South Africa is a state-owned bank that will rescue these disenfranchised from the clutches of the ruthless and the criminally exorbitant money lenders while extending banking services to the unbanked communities. It would be worth considering if there was some evidence to suggest the feasibility of success. Unfortunately, that evidence does not exist. We must never forget what took place at VBS,” says Thring.
The National Freedom Party supports the Bill. It cautioned that there should be no confusion in attempting to compare a development bank or a land bank to a state bank
“A land bank is specifically for Agriculture. And the development Bank is more for development and not only in South Africa, but for the region as well or in Africa. So the intention behind the state bank is, and let us not forget, commercial banks in South Africa to borrow from the Reserve Bank. So, the Reserve Bank takes your money and my money which is taxpayers’ money, and lends it to the commercial banks, who in turn use that money, lend it back to us and make profits out of that. So, actually what the commercial banks are doing, is to use your money to make money. So the idea of a state bank is, and I think it should be encouraged all over the world. Many countries have their own state bank so that you provide more services, particularly to the most vulnerable and the poorest of the poor in your country,” NFP Parliamentary Leader Ahmed Shaik-Emam reiterates.
‘Status quo’
When he closed the debate, ANC MP Lesiba Molala hit back at the opposition parties that do not support the Bill or the establishment of a state bank.
“The opposition has been trying to employ various stolen tactics to try and delay this process. In a similar way, they have played politics to delay many other transformative policies and programmes of the ANC. They are hell-bent on maintaining the status quo to ensure that economic wealth remains in the hands of the small minority to trickledown economics. This is evidenced by their persistent call to privatise all key entities of the state, which will, in turn, leave the pricing of goods and services to the private sector, only to inflate prices making it harder for the majority of South Africans to survive, particularly the poor and working class. And the ANC views the stance of the DA regressive and ANC, therefore, supports the Postbank Bill,” says Molala.
The objections of the DA, IFP, UDM, FF-Plus, ACDP, EFF and AIC were recorded before the Bill was passed.
