Chairperson, may I say that I agree very much with the hon member who has just sat down in his comments - hich were also raised by the chairperson of the select committee - on the whole question of investor education. Nothing can, in the long term, be more important to our economic future than that kind of effort, not only there, but elsewhere in society.
I wish to refer to clause 3 of the Constitution - and I am glad that the New NP feels the same as we do: We feel that the situation where the Minister replaces the President in appointing the Financial Services Board is wrong. It is far more than being purely technical, as it is pretended that the Minister does it anyway. We know how it works: Ministers do make recommendations, but we believe it to be a mistake for several reasons.
Firstly, the board members will be seen as placemen for the Minister - which, indeed, they will be. Secondly, the presidential appointments carry much more weight and can, therefore, attract a far higher calibre of person. The people themselves will be and will feel more independent when differences arise with the Ministry. By allowing the Minister to appoint the board, the legislation Finlandises the board.
I know many companies - and have been on the Board of some of them - where the very senior people in the company will not accept a ministerial appointment, but will only accept a presidential appointment. The more junior people will then go to the ministerial appointments further down the line and other appointments to various statutory bodies.
The Financial Services Board is one that should be rigorous, independent and have the highest calibre of person serving on it. Indeed, as I have said that some companies will not allow a person to serve because when one accepts a ministerial appointment, it is taken as a political appointment whereas if it is a presidential one, it is seen as nonpolitical. This is because the President appoints people wearing two hats, one for political and the other for nonpolitical appointments. So, there are companies which are precluded from accepting such appointments.
The second thing I would like to raise with the Minister is the question - which I am disappointed about, and was mentioned in his speech - of ombudsman for the financial services sector. It is an urgent priority that such an ombudsman should be appointed and, in my view, have statutory powers. We should be doing something about it, particularly now that the banks are moving into microlending - Standard Bank has just bought a microlending company meaning that it is moving into microlending and the other big banks will probably move in that direction as well. I am very pleased that they are, because some people in the microlending industry should not be in the business at all. The industry will have to be far more responsible as the big banks get involved.
But the need for an ombudsman is clear, because it will save millions in legal costs - the ombudsman could be funded by the industry itself. This will allow problems to be dealt with quickly, fairly and inexpensively, and there are no financial implications for the state. I really would ask the Minister, if he is not already doing so, to give it his urgent attention.
I also want to raise the question of microlending, which again affects the Financial Services Board directly. This microlending industry frightens me. I sat in my car in my village where I live, and watched people going into a microlending agency. I know the people - shepherds; simple and fine people. These people are like putty in the hands of microlenders, who take their IDs and whatever surety these poor people can offer.
The excellent name which our financial services sector has built in South Africa over a hundred years and longer is being squandered by these loan sharks that we very often find in these villages.