The South African Reserve Bank (SARB) has stated that it will challenge recommendations made by Public Protector, Busisiwe Mkhwebane to reform the institution’s constitutionally mandated powers.
Mkhwebane explained on Monday that an investigation into Sarb’s bail-out of Bankorp in the 1980s and 1990s found that funds amounting to R1 billion were “misappropriated” by the SARB.
The Public Protector added that she would recommend a constitutional amendment to the powers of the SARB around the protection of local currency to fluctuation.
“The Reserve Bank has consulted its legal team and has been advised that the remedial action prescribed by the Public Protector falls outside her powers and is unlawful”, read the SARB’s official statement.
The Public Protector’s announcement came as a shock to many, including the person who laid the initial complaint against the Reserve Bank and its Bankorp bail-out, advocate Paul Hoffman.
“She’s on a frolic of her own”, expressed Hoffman who had requested an intervention by Mkhwebane’s office into the Bankorp matter. “It has nothing to do with the complaint”.
The recommended amendment would essentially limit the powers of the SARB in protecting the rand against currency changes globally and weaken the rand initially to foreign currencies.
The report recommendations are expected to fall short of their desired effect as they must be considered in Parliament before being fully implemented.