WEDNESDAY, 8.30AM
THE RESERVE Bank told parliament yesterday that the average household debt in South Africa is 67% of disposable income “exceeding the international average of comparable countries by a considerable margin”.
The Bank said that the number of home loans grew by 38%, but the level of arrears also grew 24% to R5 billion. At the same time, the value of the properties steadily declined, reducing the banks’ security.
Reserve Bank officials have met with the commercial banks to discuss increasing the risk weighting of mortgages “to reflect the real risk inherent in home loans”. The Bank was also concerned that home loans were being used to finance other consumer spending.
Housing minister Sankie Mthembi-Mahanyele meanwhile said that the mortage Indemnity Fund had created more than 90 000 new loans worth R6,2 billion, and had managed to resolve bond disputes going back several years.
The housing department had approved subsidies to build 500 000 houses, with a further 280 000 applications close to being approved. Ther government will also review the principle of freehold rights (ownership of land) to allow for less expensive “occupational rights”, particularly in rural areas.
BUSINESS BRIEFS
CENSUS RESULTS DELAY
The target date for the release of results of the 1996 census has been postponed to April next year, but the Central Statistical Service will produce a preliminary report by the end of next month, Finance Minister Trevor Manuel said on Thursday. The exercise will cost R31-million more than budgeted, but grants from the Reconstruction and Development Programme and Swedish donors will cover the extra expense.
ZUMA’S MEDICINE PRICE WAR
A LEGAL challenge might delay the Medicines and Related Substances Control Amendment Bill, Health Minister Nkosazana Zuma said on Thursday, but she believes her department will win. The Bill, currently being debated by the parliamentary Health Committee, is designed to cut the price of pharmaceuticals and has come under serious fire from drug companies.
MINISTRY DENIES DEAL
A CLAIM by Transtel Cellular – that Transnet’s deal to sell the division to MTN had been agreed to by government and labour – was denied on Thursday by the Public Enterprises Ministry. Transtel Cellular’s union, Salstaff, also said it had not been consulted and its own black empowerment option has been “dismissed without consideration”.
SATRA CONSIDERS TELKOM
COMPLAINTS lodged with the Competition Board against Telkom’s internet activities will now be considered by the South African Telecommunications Regulatory Authority (Satra). Satra chairman Nape Maepa said the authority will meet interested parties shortly in an effort to “stabilise the industry as quickly as possible”.