EFF call for the nationalisation of banks rejected
Parliament on Tuesday shot down an EFF plan to nationalise banks without compensation.
Nationalisation of mines, banks and other strategic sectors of SA’s economy remain at the front and centre of the party’s policies.
The issue of nationalisation came to the fore recently after Christopher Malikane, an adviser to Finance Minister Malusi Gigaba, also called for the government to take over banks, mines and insurance firms.
Malikane, who is an economics professor at Wits University, proposed the setting up of a state bank that would combine all governmentowned financial institutions, the nationalisation of the Reserve Bank and the expropriation of land without compensation.
Gigaba has since distanced himself from Malikane’s views.
Opening the debate in Parliament on Tuesday, EFF leader Julius Malema said that the financial services sector was one of the biggest sectors in the economy, contributing about 20% to GDP, yet it remained the most untransformed.
He said banks controlled many aspects of people’s lives including property and cars, but the banks “refuse to transform”.
There was no single bank in SA with meaningful ownership by black people, said Malema.
“In our view, state ownership must be prioritised, but we should not [reject] all other forms of ownership.”
Malema proposed that Parliament introduce an ownership act stipulating that the state would assume a 51% stake in the ownership of banks. The rest, he said, would be owned by pension fund institutions, co-operatives and private individuals.
He said the state should create a state-owned bank, which would be used, among other functions, to distribute social grants, pay all government employees and provide finance for housing and vehicles for ordinary South Africans.
Malema called for the listing of state-owned companies on the JSE, saying that this could help stabilise them and boost their profitability.
“The success of Telkom should be why listing should be considered as an option for state-owned companies,” the EFF leader said.
However, all other parties opposed the EFF’s views.
ANC MP Adrian Williams said the nationalisation of banks without compensation would not benefit the poor, “it is the poor who will ultimately pay for it”. The country would not only gain control of the banks, but would be burdened with their liabilities, which the taxpayer will have to pay for. “That is why the ANC will not support this motion,” said Williams.
He said that in Nigeria, the government took over banks in the 1970s and by 1994, the sector was insolvent.
DA MP and finance spokesman David Maynier said: “The idea of nationalising the banks without compensation is not just a bad idea, it’s a mad idea that would crush the hopes of the 9.4-million people who do not have jobs.”
African Christian Democratic Party leader Kenneth Meshoe said nationalisation would accelerate state capture and “will be disastrous for the economy under the current climate of abuse of state resources”.
Cas Coovadia, the MD of the Banking Association SA, said: “Any nationalisation of banks will have a direct impact on stability and will seriously undermine what fragile levels of confidence remain in our economy and society.”