Public Protector backtracks on order to change the Constitution

Public Protector Busisiwe Mkhwebane has announced she will not challenge the Reserve Bank’s court case to set aside her recommendation that its mandate in the Constitution be changed.

Mkhwebane last month released her latest report on the apartheid-era looting of the state by Bankorp – the financial institution that would later be incorporated into Absa.

In her findings, Mkhwebane found that the Reserve Bank and the government failed to recover R1.125 billion from Bankorp for irregular monetary gifts granted to it during apartheid.

As part of her ruling, in an apparent bid to “prevent the same thing from happening again”, Mkhwebane recommended that Parliament move to change the Reserve Bank’s mandate as written in the Constitution.

The Reserve Bank immediately launched court proceedings to have the order reviewed and set aside, amid raised eyebrows from legal experts who said the move was unconstitutional.

On Monday (10 July), Mkhwebane submitted her answering affidavit for the case, in which she defended her recommendation, but after receiving legal advice, chose not to challenge the review application.

Notably, however, this does not relate to the order that Absa pay back R1.125 billion.

According to Mkhwebane, her reasons for seeking a change in the Constitutional mandate for the SARB were rooted in the current mandate being “too narrow”.

She said the constitutions of other countries had broader mandates, with multiple objectives – like those seen in the USA, China, or the UK.

Her recommendations sought to ensure that the SARB could not use its narrow mandate to justify “lifeboats” – as was the case with Bankorp/Absa – and to enable decisions to be taken to the “full realisation of full employment or job creation”.

According to Mkhwebane, she has accepted that she was wrong to order Parliament to carry out the Constitutional amendments.

“I was advised that the wording of the remedial action…coupled with the requirement for an action plan…conveyed a mandatory remdial action that the parties affected had to implement or to have reviewed and set aside by the court.” she said.

“I accept that it is not possible that the Constitution would confer a power upon the Public Protector to undermine other provisions of the Constitution.”

Mkhwebane has consented to having the recommendation reviewed and set aside.

Read: Public Protector’s Reserve Bank ‘suggestion’ could wipe R138 billion from SA’s economy: SARB

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Public Protector backtracks on order to change the Constitution