NewsSouthern AfricaSouth African parliament joins legal bid to quash call to change central bank's mandate

Sat,22Jul2017

Posted on Monday, 10 July 2017 11:02

South African parliament joins legal bid to quash call to change central bank's mandate

By Reuters

Speaker Baleka Mbete is in support of the South African Reserve Bank's legal bid to quash the recommendation. Photo: Nic Bothma/AP/SIPAThe South African parliament has filed papers in court challenging the anti-graft watchdog's proposal that the central bank be forced to change its economic mandate, it said.

 

Parliament said the affidavit by Speaker Baleka Mbete was in support of the South African Reserve Bank's legal bid to quash the recommendation, which was made by Public Protector Busisiwe Mkhwebane, the head of the powerful anti-graft unit.

The proposal is also being challenged by Finance Minister Malusi Gigaba.

Mbete said Mkhwebane's bid to force the central bank to target growth rather than inflation was unconstitutional as it was beyond the scope of the her mandate and encroached on Parliament's domain of enacting legislation.

Up to the courts

Mkhwebane made the proposal to change the bank's mandate when she delivered her findings on an apartheid-era bailout of a bank that was subsequently bought by Absa, now a unit of Barclays Africa Group.

"Nobody can rationally suggest that the failure by the South African government and the Reserve Bank to recover money from a bank is appropriately remedied by stripping the bank of its primary object of protecting the value of the currency," speaker Mbete said in an affidavit published on the Parliament website.

Mkhwebane is opposing the challenges to her recommendation.

It is unclear what prompted Mkhwebane's recommendation and analysts say it would be up to the courts to decide whether her mandate extends to the central bank.

 



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