Mkhwebane won’t oppose Reserve Bank review application

Public Protector Busisiwe Mkhwebane will not oppose the South African Reserve Bank (SARB) review application of her controversial Absa report which recommended an amendment to the constitution.

On Monday, Mkhwebane’s office released a statement after she filed her answering affidavit following a review court application instituted by the Reserve Bank last month.

“Having considered the legal advice from the Senior Counsel, which advice she accepted, the Public Protector, Advocate Busisiwe Mkhwebane, has decided not to oppose the SARB’s review application,” Public Protector spokesperson Cleopatra Mosana said in a statement.

Mosana offered the reasons that had prompted Mkhwebane to recommend amendment to the constitution.

“In this affidavit, the Public Protector submitted that the mandate of SARB is narrowly stated in section 224(1) of the Constitution, as there are central banks in other countries that have relatively multiple or broader mandates, such as to include, as primary objects and not as consequential or secondary objects, the promotion of full employment (job creation) and balanced economic growth,” she said.

Mosana said after her investigation it had appeared to Mkhwebane that the major motivation for the “lifeboat” had been the fear of a “run on the banks”, which could have resulted in adverse financial impacts and uncertainty among local and international investors and depositors.

“It is not evident that the socio-economic well-being of South Africans, including as regards the diversion of money that could have been used for job creation and other socio-economic objectives featured in the assessment of whether or not the ‘lifeboat’ ought to have been extended.

“In her view, such a failure to assess the other socio-economic objectives were probably enabled, and could continue to be enabled, by the narrowly stated mandate of the SARB. If left unchanged or reviewed, this narrowly stated mandate could continue to enable decisions to be taken that prejudice the socio-economic interests of ordinary South Africans, including as to the realisation of full employment or job creation.”