Public Protector gives up Reserve Bank fight as court case looms

The public protector will not oppose a court challenge against her binding proposal calling for a change to the mandate of the Reserve Bank, her office announced yesterday.

Busisiwe Mkhwebane recommended last month that the central bank's mandate of maintaining price and currency stability be changed to focus on growth.

That set off a political row that has hit the rand and government bonds, and prompted court challenges from Reserve Bank governor Lesetja Kganyago, Finance Minister Malusi Gigaba and parliament Speaker Baleka Mbete. They argue that Mkhwebane went beyond the scope of her mandate.

Public protector spokesman Cleopatra Mosana said last week Mkhwebane had filed a notice opposing the challenges to her recommendation.

Yesterday, however, her offices said Mkhwebane would no longer be putting up a defence of her recommendation in court.

"Having considered the legal advice from senior counsel, the Public Protector, Busisiwe Mkhwebane, has decided not to oppose the SA Reserve Bank's review application," Mkhwebane's office said.

The rand was unmoved by the news.

Analysts say it is unclear what prompted Mkhwebane's recommendation. It will now be up to the courts to decide whether her mandate extends to the central bank.

The Reserve Bank requested for a hearing of the case next month.

The ANC has stated it is opposed to altering the mandate of the central bank. But its ally Cosatu, South Africa's biggest labour union federation, has backed calls for changes, saying the bank was not acting in the interests of South Africa's poor.