Protector hurts the rand
Her Absa report hits the currency Moots change to the constitution
PUBLIC Protector Busisiwe Mkhwebane yesterday exposed herself to further public scrutiny and caused the rand to fall 1.5% after her assertion that she would approach Parliament to revise a section of the constitution.
Mkhwebane was widely criticised for her lack of understanding of the constitution and the limitations it put on her powers, with constitutional experts saying she does not even have the legal powers to recommend the amendment of the constitution.
While releasing findings of her CIEX report yesterday, Mkhwebane said she would approach Parliament to revise a portion of the constitution that deals with the role of the Reserve Bank, after investigations found that Absa was liable to pay back R1.125 billion for benefiting in a deal regarding the acquisition of Bankorp.
Mkhwebane recommended that the Special Investigating Unit recover the money from the bank with the help of the Reserve Bank.
The CIEX had conducted the investigation in 1997, following the request of the South African Secret Service, into banks that were given “lifeboats” by the Reserve Bank.
Constitutional law expert Pierre de Vos said yesterday that the “public protector was not constitutionally authorised to order a democratically elected Parliament to amend the constitution”.
Phephelaphi Dube of the Centre for Constitutional Rights in Cape Town concurred, saying it was “almost irrational for the public protector to recommend that the constitution be remedied for offences which took place before 1994”.
“It doesn’t make sense. First of all, we need to look at who has the powers to change the law. Only Parliament or the minister. It will mean that the National Assembly has to agree by a two-thirds majority. She (Mkhwebane) doesn’t have that power.
Dube said further that the remedial action Mkhwebane was calling for was debatable, and that there could be a judicial overreach.
“It could mean far-reaching amendments to the constitution, as there has to be participation by the electorate.
“I think I am not alone in expressing the view that there has been a possible overreach by the public protector,” said Dube, speaking on 702 last night.
Also sharing the same sentiment was Professor Shadrack Gutto, another constitutional expert, who said that by recommending the amendment of the constitution, Mkhwebane was overreaching the powers of her office.
“She (Mkhwebane) can’t recommend broad changes in how banks and other financial institutions operate.
We have a financial ombud’s office, so where does the public protector come in? She should have rather recommended to operate together with financial ombuds to see where we go.”
He added: “I don’t think we need to amend the constitution at all. She is not giving reasons why there should be changes.
“What we need is progressive interpretation of the constitution to achieve certain objectives. The problem is more about interpretation and application than actual provisions in the constitution.”
Absa were adamant that they have done nothing wrong. In a statement yesterday, the bank said they had met all their obligations regarding the loan offered by the Reserve Bank in 1995.
“It is our firm position that there is no obligation to pay anything to the government,” the bank said, stating they were willing to go to court to get a ruling on the matter.
After a leaked provisional report in January, the bank said they had done nothing wrong and demanded to see the documents Mkhwebane used to reach her conclusion.
The bank said the provisional findings were “legally and factually flawed”.
The SACP, which has been vocal on the issue since it surfaced, said its stance on the matter had not changed.
“In January, we called on Absa to pay back the full amount, plus interest. We still hold the same view. Money must be paid back without fear of favour,” said the party’s spokesperson Alex Mashilo.
He warned that Mkhwebane’s findings should not stop efforts to target others “involved in looting”.
“All looters of resources must be held accountable. Even those that loot under the guise of radical economic transformation. We must clear corruption on all fronts,” he said.
The ANC Youth League expressed delight in the findings, saying they would monitor the process and exert pressure where needed.
The Umkhonto we Sizwe Military Veterans, who have called for Absa to be held to account , said the bank should repay the money so it can be used for education.