SARB: EFF condemns Treasury opportunism

Dept's submission to SCOF consisted of distortions, untruthful statements and verbiage


Thursday, 19 November 2020

The Economic Freedom Fighters condemns the National Treasury's opportunism on the South African Reserve Bank amendment bill public hearings held on Wednesday the 18th of November 2020, by the standing committee on finance in parliament. The National Treasury submission to the standing committee on finance consisted of distortions, untruthful statements and verbiage that has no substance or evidence.

The National Treasury Ministry did not make any efforts to engage with substantive nuances of the proposed amendment in the bill tabled by the Commander in Chief and President of the EFF Julius Malema. Instead, the Minister of Finance Tito Mboweni has once again neglected his responsibilities and sent Ismail Momoniat to mislead Members of Parliament.

The South African Reserve Bank amendment bill was initiated by the EFF to deal with the ownership of the Reserve Bank of South Africa. The EFF has consistently indicated that at the moment the bill intends to only deal with ownership of the central bank to ensure that the central bank is not owned by private individuals including foreigners and majority-white people.

The EFF's proposed amendment attempts to transfer the ownership of the few predominantly white owners to the ownership of the people as a whole. The Central Bank issues 2 million shares which we as the EFF propose that all these shares must be owned by the state on behalf of the people as a whole as is the case with most central banks in the world.

It is misleading of the National Treasury to suggest that ownership of the Reserve Bank shares by the state will be an adverse signal to all investors in South African economy because it would be seen as a forceful takeover. Members of Parliament amass full rights to amend legislation in all aspects of our life including legislation that deals with financial matters if it will put the rights of South Africans as a whole above the rights of few individuals who continue to control the financial sector at the expense of all other South Africans who remain excluded and marginalized from participating in the economy.

The National Treasury has consistently put forward the interest of imaginary investors as a scaremongering tactic and to this day we have not seen their role in the South African economy to actively reduce poverty unemployment and inequality.

The so-called bilateral investment treaties and rights of foreign shareholders should not come before the rights of South Africans. South Africans ought to participate in their own economy before any foreign national is given preference. The National Treasury conducts itself as if they are an appointed spokesperson of foreign investors and gives no regards to South Africans who by the constitution should be a priority.

It is extremely unacceptable and disingenuous of the National Treasury to want to suggest that anywhere where there is state ownership there will be corruption or capture. The state owns and controls some of the well-functioning institutions including the biggest asset manager in the African continent the Public Investment Corporation (PIC).

To want to suggest that state control and ownership equates to corruption is to cast aspersions on a black government, particularly the idea that black people cannot manage complex financial institutions without corruption or capture and this must be renounced with the contempt it deserves.

The EFF strongly condemns the insinuation by the National Treasury that Members of Parliament who are elected by the public need guidance from the government when drafting legislation. We are not in parliament to follow the lead of the National Treasury that has misled the nation for many years. National Treasury has mismanagement the economy for the longest time without being held accountable. Momoniat himself is like a piece of furniture at the National Treasury that adds no value to the policy or progress of our people.

We make legislation which sometimes differs with government policy objectives because as it is the case now, we know that government is being led by a collective of incompetent people who have no commitment, political will, and capabilities to revive the economy and take this country forward.

It is misleading that shareholders can have an illegitimate claim to assets of the South African Reserve Bank including foreign reserves. Momoniat raises this point without any substantive evidence or reference to precedents anywhere in the world where there has been the nationalisation of central banks. The whole presentation was made up of fictitious stories that do not have any sense of direction or resolution to the challenges that we face in the financial sector of continued monopoly and control of banking, insurance and other financial services. What the National Treasury presentation does not articulate is that the low growth trap, high levels of debt which they are failing to manage is as a result of their incompetence.

Statement issued by the EFF, 19 November 2020