Public Finance Management Act, 1999 (Act No. 1 of 1999)RegulationsTreasury Regulations for Departments, Constitutional Institutions and Public EntitiesPart 8 : Miscellaneous23. Government payroll deductions |
| 23.1 | Definitions |
In this regulation, unless the context indicates otherwise, a word or expression to which a meaning has been assigned in the Act, has the same meaning, and—
"Accountant-General"
means the officer of the National Treasury designated as the Accountant-General;
"basic salary"
means the annual notch that an official is employed on divided by 12. It excludes additional remuneration from overtime or other allowances;
"benefit deduction"
means a deduction on Persal against an official’s salary for a debt arising from employment benefits, including home owner’s allowances and the motor finance scheme for senior officials;
"collective agreement deduction"
means a deduction on Persal against an official’s salary arising from a collective agreement between the state and a union registered with the Public Service Co-ordinating Bargaining Council or similar body, in accordance with applicable law;
"debt"
means an amount of money owed and already payable by an official to any person and for the purposes of these regulations, includes insurance premiums deducted in terms of policies with long and short-term insurers;
"deduction code"
means a code issued by the Accountant-General to enable a person to deduct money from an individual paid via the Persal system;
"Director-General"
means the Director-General: National Treasury;
"discretionary deduction"
means a deduction on Persal against an official’s salary, other than benefit, collective agreement, state or statutory deductions;
"official"
means a person in the employ of a department or a person in the employ of a constitutional institution who receives his or her salary via Persal, but excludes persons employed in terms of section 1 of the Magistrates Act, 1993 (Act No. 90 of 1993) and section 3 of the Intelligence Services Act, 2002 (Act No. 65 of 2002);
"Persal"
means the personnel salary system of national and provincial government, and includes the Persol system;
"person"
depending on the context, includes reference to the state or any other legal entity;
"state deduction"
means a deduction on Persal against an official’s salary for a debt to a department that is subject to section 34 of the Basic Conditions of Employment Act (Act 75 of 1997);
"statutory deduction"
means a deduction on Persal against an official’s salary, which is required or permitted in terms of a law, court order or arbitration award.
| 23.2 | Persal deductions |
| 23.2.1 | No official or employee of an entity contracted to operate Persal may, whether for paying a debt or any other purpose, process a discretionary deduction except in accordance with the provisions of these regulations and the agreement as contemplated in paragraph 23.3. |
| 23.2.2 | Before a benefit, collective agreement, state or statutory deduction is processed on Persal, the accounting officer must certify that the deduction is due and that no portion of it is a discretionary deduction. |
| 23.2.3 | Where such certification is for an emoluments attachment order issued against an official in terms of section 65J of the Magistrates’ Court Act (Act 32 of 1944), the accounting officer must be satisfied that— |
| (a) | the documentation presented by the judgement creditor or his or her attorney inter alia reflects, as contemplated in this Act – |
| (i) | that the official has given written consent to the issuing of the order or that a court has authorised it (on application or otherwise), and that this authorisation has not been suspended; or |
| (ii) | that the official has first been sent a registered letter advising him or her of the amount of the judgement debt and costs, and warning that an emoluments attachment order will be issued if this amount is not paid within ten days of the date of its posting; |
| (b) | after the deduction, the official will have sufficient means for maintenance for him or herself and any dependants. |
| 23.2.4 | Should the deduction not leave the official with sufficient means for maintenance or for that of his or her dependants, the accounting officer must advise the official of his or her right to approach the court to either rescind the order or amend it to affect only the balance of the salary after provision for such maintenance. |
| 23.3 | Deduction codes |
| 23.3.1 | Any person may apply for a deduction code for a discretionary deduction, subject to the requirements as laid down by the Accountant-General. |
| 23.3.2 | Only the Accountant-General may approve the issuing of deduction codes, in terms of an agreement between the Accountant-General and a person qualifying for such a code. |
| 213.3.3 | A person applying for a deduction code must certify in the application that— |
| (a) | the code is required by – |
| (i) | a department; |
| (ii) | an insurance company (for insurance deduction codes) approved by the Financial Services Board; |
| (iii) | a company (for loan deduction codes) that is registered under the Banks Act (Act 94 of 1990) or with the Micro Finance Regulatory Council (MFRC); |
| (iv) | a public higher education institution; or |
| (v) | a private higher education institution approved by the national Department of Education. |
| (b) | third parties, including brokers, will not be allowed access to the code; |
| (c) | the person consents to— |
| (i) | entering into an agreement with the Accountant-General, which is subject to annual review; |
| (ii) | the oversight of the Financial Services Board and the National Treasury to monitor compliance with the agreement and this regulation; and |
| (iii) | an audit, at own expense, by parties determined by the Accountant-General; |
| (d) | the person is in good standing with the South African Revenue Services and will annually provide the Accountant-General with proof of such good standing. |
| 23.3.4 | The Accountant-General may levy a fee of up to 5 per cent of deductions for emolument attachment orders, except orders specifically for child maintenance. |
| 23.3.5 | The National Treasury may, for a discretionary loan deduction, determine the maximum loan period, the maximum loan amount and the interest rate (this will form part of the agreement with the Accountant-General)— |
| (a) | for loans over R10 000, the Usury Act limit is the maximum, all inclusive interest rate; |
| (b) | for loans below R10 000, the maximum is 27 per cent plus an administrative cost subject to a limit set out in the agreement with the Accountant-General. |
| 23.3.6 | Discretionary deductions may not exceed 40 per cent of the official’s basic salary, provided that— |
| (a) | deductions for insurance premiums do not exceed 15 per cent; |
| (b) | other discretionary deductions do not exceed 25 per cent; and |
| (c) | the minimum take-home pay is as specified in the agreement with the Accountant-General. |
| 23.3.7 | Notwithstanding the provisions of paragraph 23.3.6, discretionary deductions in excess of the limits prescribed by that paragraph may be deducted; provided that the Accountant-General is satisfied that not allowing such deductions will substantially prejudice the interests of the employee and that such deductions shall be limited in duration to a period as determined by the Accountant-General. |
| 23.3.8 | The Minister of Finance may determine the future of the discretionary deductions system and the number of deduction codes on the Persal system. |
| 23.3.9 | Insurance companies to whom deduction codes are allocated may vary premiums periodically, provided that the annual increase does not exceed 15 per cent of the premium or ten rand (R10), whichever is greater. |
| 23.4 | Contravention of regulations and penalties |
| 23.4.1 | Any serious or persistent material non-compliance with this regulation or the terms of the agreement with the Accountant-General constitutes misconduct. |
| 23.4.2 | It is a serious contravention for any person to knowingly exceed the deduction limits described above. |
| 23.4.3 | The Accountant-General may penalise a person for contravening this regulation by— |
| (a) | withdrawing or suspending the use of a deduction code; |
| (b) | refusing access to the Persal system for a specific period; |
| (c) | publishing the identity of the person and the details of the contravention; |
| (d) | laying criminal charges; and |
| (e) | if the person is an official, direct that the contravention be dealt with in terms of the Act. |
| 23.4.4 | Any person aggrieved by a decision of or penalty imposed by the Accountant-General may appeal to the Minister of Finance, whose decision will be final. |