President Cyril Ramaphosa has moved to the defence of Finance Minister Tito Mboweni and ANC head of economic transformation Enoch Godongwana on the ANC’s internal battles over the mandate for the SA Reserve Bank (Sarb).
His move follows a public spat among party leaders after secretary-general Ace Magashule announced this week that the ANC’s national executive committee lekgotla had resolved to push for the expansion of the Sarb’s mandate.
Magashule said the lekgotla had agreed to expand the central bank’s mandate beyond price stability to also include growth and employment, a claim disputed by Mboweni and Godongwana, who both said no such decision had been taken.
The two accused Magashule of recklessness and of worsening policy uncertainty through his remarks.
Following a meeting of the ANC’s Top Six yesterday, Ramaphosa said the officials had reiterated the ANC’s policy positions on the independence and role of the bank, as set out in the Constitution.
“The Constitution sets the role of the Reserve Bank as protecting ‘the value of the currency in the interest of balanced and sustainable economic growth’. It further states that this mandate must be exercised in regular consultation with government, through the Cabinet minister responsible for national financial matters. This policy has not changed,” Ramaphosa said.
In 2017, the ANC resolved to nationalise the Reserve Bank, but reneged following political differences with its alliance partners.
Ramaphosa said nationalising the bank was not a priority, adding that the recent spat over the central bank risked undermining the confidence of South Africans and investors.
“It is our desire for the South African Reserve Bank to be publicly owned. However, we recognise that this will come at a cost, which, given our current economic and fiscal situation, is simply not prudent,” he said.
According to Ramaphosa, the lekgotla had focused on priorities for the implementation of the ANC manifesto and called for a focus on growing an inclusive economy and the building of state capacity.
Several ANC leaders, Cosatu and the SACP have however pointed out that Magashule's utterances on the Sarb’s mandate were in line with the ANC's manifesto.
In its manifesto the ANC stated: “The ANC believes that the South African Reserve Bank must pursue a flexible monetary policy, aligned with the objectives of the second phase of transition.
"Without sacrificing price stability, monetary policy must take into account other objectives such as employment creation and economic growth.”
The SACP said: ”It is important for the ANC, and of course the alliance as a whole, to remain true to history and loyal to the commitments we have made to our people.”