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Cosatu calls for nationalisation of the Reserve Bank

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Cosatu calls for nationalisation of the Reserve Bank

Photo by Duane Daws

17th January 2017

By: African News Agency

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The Congress of South African Trade Unions (Cosatu) on Tuesday called for government to nationalise the South African Reserve Bank (Sarb).

Cosatu was responding to a leaked preliminary report by the Public Protector Advocate Busisiwe Mkhwebane on the involvement of Absa in apartheid bail out from 1985 to 1995.

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The Mail & Guardian first reported on Friday that the provisional finding from Mkhwebane holds Absa liable for the repayment of R2.25-billion bailout from government to the Bankorp group, which was bought by Absa, in the early 1990s.

But the bank defended itself against the allegations.

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Absa said that the Davis Panel of experts appointed by former Reserve Bank’s governor Tito Mboweni in 2000 found that its shareholders did not derive any undue benefit from the Sarb’s intervention, and as such no claim of restitution could be pursued against it.

In a statement, Cosatu said there was need for a Commission of Inquiry to get to the bottom of this matter.

Cosatu said the inquiry would also need to investigate other illegal transactions that may have occurred prior to the 1994 elections and during the government of national unity.

“The allegations that the government might have overlooked recovering the monies from Absa are troubling. This report raises the role of Sarb in facilitating the syphoning of money by the private sector and thereby prejudicing the public purse,” Cosatu said.

“This matter raises the question of the independence of the Reserve Bank. We need to nationalise [the] Reserve Bank, because it seems like it is hiding the rot and insulating banks from scrutiny.”

Cosatu said based on the country’s rule of law, and with hindsight, the money should have been recovered.

“The Treasury and banks have to comply with constitution and to protect the fiscus from greedy bankers. We reiterate our call that the independence of the Reserve bank should be revisited,” Cosatu said.

On Monday, Reserve Bank governor Lesetja Kganyago said he was studying the Public Protector’s report into Absa and had already found inaccuracies in it. Kganyago said he would give an extensive feedback this week.

Mkhwebane was due to release her preliminary report on Monday, after receiving comments from implicated parties, but this did not happen as her office allegedly had problems with its servers.

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