THE NATIONAL COUNCIL OF PROVINCES
QUESTION FOR WRITTEN REPLY
265. Mr K A Sinclair (COPE-NC) to ask the Minister of Trade and Industry:
Whether, with regard to recent media articles (details furnished), he
has found the current state of affairs at the National Empowerment
Fund to be satisfactory; if not, why not; if so, what are the relevant
details? CW362E
Reply:
At the time of PFMA classification following its establishment in 1998
through the promulgation of the National Empowerment Fund (NEF) Act, 105 of
1998, the NEF was conceptualised to be primarily an invetstment vehicle
through which to facilitate the transfer of government equity allocations
to black people out of the then state entity privatisation programme. Since
inception, the NEF has evolved into a Development Finance Institution (DFI)
reporting into the dti. NEF has been focusing on funding to black
empowerment businesses across all sectors and stages of business.
The original classification of the NEF as national public entity listed
under Schedule 3A of the PFMA, made in terms of the following defined
requirement of the PFMA, was on the bases that the NEF is 1) established in
terms of the national legislation (the NEF Act); 2) fully funded from the
National Revenue Fund; and 3) accountable to Parliament. Since 1 April
2010, the NEF has not been dependent on the NRF as a result of the moneys
received from the sale of MTN shares. Based on the performance of NEF of
519 approved transactions worth R5 048 billion and 417 disbursements worth
R 3 644 billion and a projection of 200Â 000 jobs (accumulated) to be
created over the next three years and a definitive number of 40Â 000 jobs
created as at 31st March 2013, a request was made that the NEF be
recapitalized.
The dti and National Treasury together with NEF are looking for a
favourable solution on the issue of recapitalisation.