Cape Town - Parliament's finance portfolio committee has rejected figures which state the financial services sector is meeting and exceeding transformation targets.
The Financial Sector Charter Council (FSCC), which oversees the implementation of the financial services transformation charter, told the committee the sector had exceeded the 10% ownership target.
This was one of the goals set for the industry by the sector's empowerment charter. According to the FSCC's Nkosana Mashiya, direct black ownership in the sector is 11%.
Mashiya said while ownership and control targets are low, the sector had exceeded the minimum requirements. For example, the minimum for blacks employed in senior management positions by 2008 was between 20% and 25%, while in reality the sector had reached 25.37%.
The target for empowerment financing was R1.5bn, but the sector had reached R4.44bn by the end of 2008.
However, finance committee chairperson Thaba Mufamadi was blunt about the fact that he did not buy these figures.
"If it is so transformed, why can't it relate to people?" he asked.
While some speakers accused the FSCC of massaging the figures to suit its members, all of whom are voluntary, Mashiya stressed that the council needed to be given more teeth so that it could supboena member trade associations.
These include the Savings and Investment Association, the Banking Association of South Africa, the International Banking Association, the SA Insurance Association and the JSE Securities.
Trade federation Cosatu told the committee this sector did the bare minimum when it came to ownership and empowerment issues, and called on government to come up with legislation to force transformation.
National Treasury, which copped criticism from labour for "babysitting" the sector, warned MPs that transforming the sector demanded a serious balancing act.
Treasury deputy director general Ismail Momoniat said that black economic empowerment codes did not set targets that were demanding enough for the financial sector charter, while the FSCC had taken its eye off the ball by focusing on ownership.
This meant that other areas of empowerment and transformation, like access to banking, had taken a back seat.
Nevertheless, Momoniat said MPs had to remember that the financial services sector was already paying its dues in the form of taxes.
"This (empowerment) is an added burden. Capital is mobile so we have to strike a careful balance and all charters should be pushing jobs, jobs, jobs," he said.
He then stressed that government was planning further regulations for this sector, which would be an additional burden to bear in ind when reviewing empowerment charters.
- Fin24.com