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Johannesburg – Parliament has filed a supporting affidavit for the South African Reserve Bank’s (SARB) application against the Public Protector’s report.
According to a statement issued by Parliament, Speaker of the National Assembly Baleka Mbete filed the affidavit at the North Gauteng High Court on Friday.
READ: SARB files urgent court application against Public Protector
Reserve Bank Governor, Lesetja Kganyago filed the initial application in June, asking the court to set aside Public Protector Busisiwe Mkhwebane’s remedial action to have the mandate of the SARB changed.
In Parliament’s affidavit, Mbete indicates that the public protector’s order is unconstitutional, it is not a remedy, it encroaches on Parliament’s exclusive domain and is undemocratic. She also said that it “negates” section 74 of the Constitution which sets out the special requirements for amending the Constitution. Mkhwebane’s amendment “perverts” the separation of powers.
Mbete explained that the public protector’s order is unambiguous, and not merely an order that a motion for its amendment be introduced in Parliament first.
The effect of the amendment would remove the primary objective of the Reserve Bank to protect the value of the currency, the affidavit read. “It does not allocate this function to anybody else. It leaves the currency unprotected.”
ALSO READ: SARB affidavit pokes holes in Public Protector report
The order is unconstitutional because it is beyond the scope of the public protector’s mandate, which is designated by the Constitution, said Mbete.
“The public protector is thus a creature of the Constitution and her remedial powers are derived from the Constitution. She operates under the Constitution and not over it… She does not have the power to order or even propose an amendment of the Constitution."
Further, Mkhwebane’s remedy is unrelated to the matter investigated. Mkhwebane investigated government and the Reserve Bank’s failure to recover money from Bankorp, now Absa. The remedy to have the Constitution amended and “strip the Reserve Bank of its primary function” is unrelated to the findings made.
“Her order, that the Reserve Bank be stripped of its primary function of protecting the value of the currency, seems little more than a personal predilection wholly unrelated to the improper conduct that she found in this case,” said Mbete.
“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.”
The public protector may not prescribe to Parliament how to exercise its discretionary powers, Mbete said. This power lies with the Constitution.
The function of promoting “balanced and sustainable economic growth” and ensuring the socio-economic well-being of the citizens lies with the national executive, and not the Reserve Bank, Mbete highlighted.
READ: Public Protector to oppose bid by Treasury, SARB and ABSA
The public protector is yet to file responding affidavits to those filed by the SARB, ABSA and Treasury, her office confirmed to Fin24.
Finance Minister Malusi Gigaba is challenging her order as it seeks to remove his role to consult with the Reserve Bank, found in section 224 of the Constitution.
In its affidavit, Treasury indicated that Mkhwebane does not have the power to direct policy change, as this responsibility lies with the national executive.
The Reserve Bank’s mandate to protect the currency is in the interest of “balanced and sustainable economic growth” of the country, Treasury said. “As such, there is no rational foundation to the recommendation to remove the ‘currency protection’ mandate of the Reserve Bank.”
Gigaba explained there is no contradiction between protecting the value of the currency and the need to address socio-economic challenges of the economy. “The two objectives contained in section 224(1) should not be read disjunctively or in opposition to one another - they are mutually reinforcing and supportive."
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