SACP wants mandate of SA Reserve Bank reviewed
Johannesburg - The SACP appears to be on a collision course with President Cyril Ramaphosa after the party proposed that Finance Minister Tito Mboweni review the Reserve Bank’s mandate.
The party, which backed Ramaphosa ahead of the ANC’s December 2017 national conference, will hold its special congress in December and among the key proposals is that the central bank must alter its mandate to also focus on growth and employment priorities.
Discussion documents prepared for the end-of-year gathering are agitating for a policy rejected by Ramaphosa during his post-election State of the Nation Address in June.
“We reaffirm this constitutional mandate, which the Reserve Bank must pursue independently - without fear, favour or prejudice. Our constitution also requires that there should be regular consultation between the Reserve Bank and the minister of finance to promote macroeconomic co-ordination, all in the interests of employment creation and economic growth,” Ramaphosa said then.
But the SACP wants Mboweni to “explicitly change the mandate of the Reserve Bank to include growth and employment priorities, with the amount of money in circulation and price stability secondary targets as means to an end and not objectives in their own right.”
The SACP said even in the US, the Federal Reserve has employment as a leading indicator.
The party has undertaken to campaign for Mboweni to direct concessional credit to specific sectors such as small, micro and medium enterprises as well as local co-operative banks.
In June, Cosatu repeated its calls for the Reserve Bank’s mandate to be reviewed to, instead of narrowly fighting inflation, contribute to realising employment, economic growth and redistribution targets.
The SACP also wants the Reserve Bank to “monetise” rand-denominated debt by purchasing public debt held by the Public Investment Corporation (PIC), on condition that the continent’s largest asset manager, the PIC, invests the new cash in key productive areas.
The organisation admits that the short- and medium-term trajectory of the Ramaphosa administration are not a given as the Left is up against powerful opponents within the wider pro-Ramaphosa camp.
“The statement that a vote for the ANC, a vote for Ramaphosa, must never be a blank cheque requires the SACP to sustain and build capacity to mobilise the working class behind a programme of accountability of government and of active popular participation in ‘delivery’: #RedCardBlankCheques,” reads the party’s document.
It sees Ramaphosa’s ascendancy to power to be a little more futile for the working class.
“The SACP support for the ANC was not a reflection of being opportunistically blinded by the ‘Ramaphoria’ cult motivated by a narrow set of electoral calculations,” the party said.
At the special congress, the SACP is also expected to deliberate on whether or not to contest the 2021 local government elections and whether its processes are appropriately transparent.