Hon House Chair, the NFP, after careful consideration, is of the opinion that the Development Bank of Southern Africa, DBSA, Bill, in its present form, is not in the best interests of the people of South Africa.
The Development Bank, as a listed major public entity in terms of Schedule 2 of the Public Finance Management Act, should first and foremost engage in financing ventures where beneficiaries are first and foremost South Africans. The NFP accepts the 70%/30% split between domestic regional involvement, as is currently the status quo, since 30% regional involvement is close to home and likely to benefit South Africans due to the proximity of recipient countries.
We are, however, concerned that financial involvement with other countries, which does not directly impact on the general well-being or improvement of the Southern African Development Community, SADC, region will divert resources away from the region and in the process dilute the benefit for South Africans. For this reason, the NFP does not support the amendment to increase the reach of the Development Bank of Southern Africa beyond the SADC region.
The NFP is also not in support of the amendment to increase the authorised share capital of Development Bank of Southern Africa. South Africans are faced with a strong possibility of increased taxes next year and we are constantly reminded that there is a need to cut back on expenditure; yet, the Bill proposes a massive increase of R15 billion in the share capital of the Development Bank of Southern Africa. Ultimately it is the taxpayer who will be burdened.
We may well say that the increased share capital will benefit South Africans as it increases the capital available to fund domestic projects in accordance with the 70%/30% allocation. We are, however, mindful that it also means that more money will be available for regional and continental assistance.
Should the increase be accepted as per the Bill, then it will be prudent significantly to reduce the percentage of capital available for nondomestic development to ensure that more funds are available for domestic development. Charity begins at home, hon House Chair. As the NFP, we would prefer to see the Development Bank of Southern Africa focus on improving the lives of all South Africans as its core function and leave regional and continental development to institutions that are funded regionally or continentally.
By approving the increased reach of the Development Bank of Southern Africa, as well as its share capital, we will have a situation where South African taxpayers, indirectly, have to carry all the risk even though the benefit may accrue to other countries. We believe that this is inherently unjust. Thank you, Chair. [Time expired.]