Gigaba to challenge Mkhwebane’s proposal on Reserve Bank’s mandate

Advocate Busisiwe Mkhwebane found the Reserve Bank's monetary policy mandate should no longer focus on inflation targeting.

FILE: Minister Malusi Gigaba. Picture: Christa Eybers/EWN.

JOHANNESBURG - Finance Minister Malusi Gigaba has confirmed he's challenging the proposal by the Public Protector Busisiwe Mkhwebane to change the Reserve Bank's mandate of maintaining currency and price stability to focus instead on growth.

In a statement released by the finance ministry on Wednesday, Gigaba said: “There is no intention on the part of the executive to amend the Constitution in any manner."

Two weeks ago, Advocate Mkhwebane found the Reserve Bank's monetary policy mandate should no longer focus on inflation targeting.

The Finance Minister says the constitutional amendment proposed by the Public Protector for the Reserve Bank is not necessary and has instructed counsel to take her CIEX report on review.

The bank and Absa have already filed papers in the High Court to challenge Mkhwebane’s report, which also looked into an apartheid-era bail-out for Absa’s predecessor Bankorp.

Minister Gigaba says a constitutional amendment is unnecessary, saying the Reserve Bank does not protect the currency for its own sake but rather to ensure balanced and sustainable economic growth.

Advocate Mkhwebane proposed changes to the Reserve Bank’s mandate to include protecting citizen’s socio-economic conditions.

But Gigaba says Mkhwebane’s findings of fact are not necessarily adequately connected to the evidence before her.

In Absa’s court papers filed last week, economist Iraj Abedian described the remedial action as both unscientific and irrational.

(Edited by Winnie Theletsane)