National Treasury on draft procurement regulations, Cooperative Bank Act status, funding access initiatives supporting MSMEs, cooperatives & DSBD’s Funding Policy

Video The Portfolio Committee met virtually for a briefing by National Treasury on the draft General Public Procurement Regulations, the status of the Cooperative Banks Act of 2007, and National Treasury's role in improving access to funding for micro, small and medium enterprises (MSMEs) and cooperatives, including support for the Department of Small Businesses Development, MSMEs and the cooperatives funding policy. National Treasury presented reforms aimed at strengthening financial inclusion, cooperative banking, and MSME financing. Its briefing covered amendments to the Cooperative Banks Act, the development of risk-based prudential standards, and initiatives such as the movable assets collateral registry. Members raised concerns about access to finance, collateral constraints, regulatory thresholds -- such as the 15% borrowing limit and membership caps – the exclusion of cooperative financial institutions (CFIs) from the Corporation for Deposit Insurance (CODI), governance risks, and cybersecurity. Procurement reforms were also discussed, particularly the proposal for direct payment to sub-contractors and its implications for quality assurance and accountability. In response, National Treasury explained that reforms were ongoing and subject to public consultation, with a shift toward risk-based supervision and a tiered regulatory approach for CFIs. The establishment of the Financial System Council of Regulators was highlighted as a coordination mechanism for financial inclusion. CODI inclusion of CFIs remained planned for a later phase, pending improved data systems and readiness. On procurement, the Office of the Chief Procurement Officer indicated that draft regulations remained open for public comment, with sub-contracting reforms intended to address non-payment while maintaining quality control and accountability. The Committee was also briefed on a proposed study tour to Brazil scheduled for June. The Democratic Alliance (DA) indicated it would not participate due to constituency obligations during the voter registration weekend, and adjustments to the delegation were noted.