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Johannesburg - Reserve Bank governor Lesetja Kganyago has castigated Public Protector Busisiwe Mkhwebane, calling her actions reckless and incompetent.
He questioned whether she truly understood South Africa’s Constitution.
Kganyago filed his searing affidavit in the North Gauteng High Court in Pretoria on Friday after Mkhwebane announced earlier this week that she would not oppose the review application of the South African Reserve Bank (SARB), relating to its mandate, following her report in which she called for the constitutional mandate of the bank to be changed.
The bank said it would still be continuing with its review application, despite the Public Protector stepping bank.
READ: Public Protector defends SARB stance but won't oppose court application
The governor didn’t mince his word in the court papers saying that Mkhwabane had a “fundamental lack of understanding of the monetary system and the role of central banks”.
“The report was reckless. The Public Protector’s explanation of it is based on a clear lack of understanding of the Constitution. It perpetuates a fundamental misunderstanding of the Bank’s powers and functions,” Kganyago said in his sworn affidavit.
He said Mkhwabane’s impugned remedial action had immediate and damaging consequences for the country.
“It is clear from her answering affidavit that she had no regard to the inevitable and serious impact of her report before releasing it.”
Said Kganyago: “Despite the public protector now conceding the merits of the case, she has filed an affidavit in which she seeks to explain 'how and for what reasons' she arrived at the remedial action."
READ: Gigaba takes Public Protector's ABSA report on review
The governor said Mkhwabane’s explanation also shows that she failed to take into account detailed submissions the bank had provided to her in February.
Kganyago felt the only explanation that the Public Protector has offered for her clearly unlawful conduct, “exposes her own lack of competency”.
He concluded that it was not the place of the Public Protector to meddle “in these matters”.
Kganyago’s scathing affidavit will increase pressure for action against Mkhwebane, whose credibility has plummeted since her contentious Reserve Bank recommendation in June.
Her report titled “Alleged Failure to Recover misappropriated Funds” moved markets and caused a political storm that is still raging. The investigation criticised the government and SARB for failing to recover an apartheid-era loan of R1.125bn from Bankorp Limited/Absa Bank, advanced as an “illegal gift” to the Bankorp group.
In the report she recommended that a portfolio committee on justice and correctional services initiate a process to change the constitutional mandate of the Reserve Bank.
Her proposal caused the rand to slide against all major currencies. Two days after the report’s release, credit ratings agency S&P Global also asked SARB for a meeting.
SARB first filed the application at the North Gauteng High Court on Tuesday June 27 to have her recommendation set aside.
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