| (1) | Despite section 18, the National Treasury may in its discretion or on request of a transferring officer or a receiving officer stop the transfer of a Schedule 4 or 5 allocation, or a portion thereof, to a province or municipality— |
| (a) | on the grounds of persistent and material non-compliance with this Act; |
| (b) | if the National Treasury anticipates that a province or municipality will substantially underspend on the allocation, or any programme, partially or fully funded by the allocation, in the 2015/16 financial year; |
| (c) | for purposes of the assignment of a function from a province to a municipality, as envisaged in section 10 of the Municipal Systems Act; or |
| (d) | if a province implementing an infrastructure project does not comply with construction industry best practise standards and guidelines, as identified and approved by the National Treasury. |
| (2) | The National Treasury must, before stopping an allocation in terms of subsection (1)(a), (b) or (d)— |
| (b) | inform the relevant provincial treasury of its intention to stop the allocation. |
| (3) | The National Treasury must give notice in the Gazette of the stopping of an allocation in terms of this section and include in the notice the effective date of, and reason for, the stopping. |
(4)
| (i) | an allocation, or any portion thereof, is stopped in terms of subsection (1)(a), (b) or (d); and |
| (ii) | the relevant transferring officer certifies in writing to the National Treasury that the payment of an amount in terms of a statutory or contractual obligation is overdue and the allocation, or a portion thereof, was intended for payment of the amount, |
the National Treasury may, by notice in the Gazette, approve that the allocation, or any portion thereof, be utilised to pay that amount partially or fully.
| (b) | The utilisation of funds envisaged in this subsection is a direct charge against the National Revenue Fund. |
