Tshabalala is also happy with the proposed
reforms of retirement funds, so does chairman
of Alexander Forbes, Sello Moloko.
‘At current levels, too many South Africans
will retire poor. This further exacerbates an
already low national savings culture and an
ever-increasing burden on the State to provide
necessary, but costly social grants,’ says Moloko.
‘This is an issue that calls for government, the
retirement benefits industry and other key
stakeholders, such as employers and trade
unions, to put our heads together to suggest and
implement sustainable and all-encompassing
retirement benefits,’ he says.
Tshabalala says bankers are keen to engage
with National Treasury to discuss how to
increase mortgage lending and increase the
overall lending book.
‘I think this will lead to valuable discussions
about the balance of responsibility between the
public and private sectors to offer and guarantee
housing finance; and may also enable us to look
(as a country) at how best we can respond to
the Basel III requirements without unduly
restricting long-term lending.’
Bankers say they are also keen to play their
part in encouraging responsible lending and
recovery of loans, which Gordhan mentioned in
the budget. Gordhan has been on a crusade that
has become almost personal, to force both banks
and non-financial credit providers to adopt more
responsible lending practices and discourage overindebted customers to borrow more.
Estimates show that of the more than
19.5-million credit active South Africans, as
BRICS countries
also plan to pool
their combined
foreign exchange
reserves of
$4.5 trillion to
support each
other at times
of balance of
payments or
currency crisis.
many as 12-million have missed at least one
debt instalment, while more than nine million
have impaired credit records, meaning they
have missed three or more instalments. Even
more worrisome is the fact that more than 55%
of credit-active people spend more than what
they earn.
‘We fully share the Minister’s concern
about personal lending and recovery
practices that may have left workers
without money to live on,’ Tshabalala says.
‘As agreed between the members of The
Banking Association South Africa and
the National Treasury in November 2012, we
will continue to work with the Treasury and
the National Credit Regulator to make sure
that abusive practices are brought to an end,’
he says.
Gordhan also confirmed plans by BRICS
member countries to establish a development
bank to mobilise savings to fund infrastructure
projects and other projects aimed at stimulating
intra-BRICS trade and investment. The
Minister says BRICS countries also plan to pool
their combined foreign exchange reserves of
$4.5-trillion to support each other at times of
balance of payments or currency crisis.
Tshabalala says that the proposed BRICS
development bank could well be a useful new
source of funds for infrastructure development.
‘The creation of a BRICS foreign exchange pool
and a BRICS trade insurance risk pool could
be valuable new sources of financial stability
for South Africa and our BRICS partners,’
he says. By Sure Kamhunga
PRAVIN GORDHAN – A QUIET CRUSADER
Amiable, friendly and forthright, Pravin Gordhan (born 12 April, 1949) is the man managing the finances of Africa’s largest economy.
He plays an important role as South Africa’s representative at the G20 group of countries and also provides input and influence on
the Basel Committee of Banking Supervision, of which South Africa is a member.
Gordhan took over as Finance Minister from Trevor Manuel on 11 May 2009, taking charge of state finances that were in surplus,
thanks to high tax revenues boosted by a commodity boom not seen in decades.
Gordhan joined the Ministry of Finance after a successful stint at the South Africa Revenue Service (SARS), where he was
instrumental in ensuring that it was run with operational and management autonomy that is found in