Mkhwebane ‘didn’t invent’ ideas about the mandate of the Reserve Bank

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Suspended Public Protector, Advocate Busisiwe Mkhwebane, “did not invent” ideas about the mandate of the Reserve Bank – they had long been there before she joined the office of the Public Protector. Photo: Jaco Marais
Suspended Public Protector, Advocate Busisiwe Mkhwebane, “did not invent” ideas about the mandate of the Reserve Bank – they had long been there before she joined the office of the Public Protector. Photo: Jaco Marais

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Suspended Public Protector, Advocate Busisiwe Mkhwebane, “did not invent” ideas about the mandate of the Reserve Bank – they had long been there before she joined the office of the Public Protector. This was the evidence of a former investigator in that office, Livhuwani Tshiwalule, during cross-examination at the parliamentary inquiry into Mkhwebane’s fitness to hold office.

Tshiwalule worked at the chapter 9 institution from 2014 until December 2016, and one of the reports he worked on was the CIEX report. It is in the CIEX report that Mkhwebane made recommendations for a constitutional amendment to change the mandate of the Reserve Bank. However, the Pretoria High Court set aside the report. Judge John Murphy ruled that the recommendation by Mkhwebane was “disastrous”. She agreed that the remedial action to ask for the constitutional amendment of the Reserve Bank was unlawful.

During cross-examination, Tshiwalule, answered questions by Mkhwebane’s legal counsel Advocate Dali Mpofu, and revealed that discussions about the mandate of the National Treasury and the Reserve Bank were in the draft documents of the CIEX report.

He was responding to a question by Mpofu that one of the “reasons/excuses given for the lack of appetite to recover the money” was that the primary mandate of the Treasury was to protect the economy, and the state would not do anything to jeopardise it.

READ: Mpofu makes fresh attempt for inquiry to subpoena Ramaphosa 

The CIEX report was about the bailout by the Reserve Bank to Bankorp during the apartheid era. It recommended that Absa, which had bought Bankorp in 1992, pay back the R1.125 billion bailout.

“So, I’m saying, therefore, if that was then posed as a reason or excuse, then that would have shown the connection between the failure to recover the money and the mandate issues, the broad mandate economic issues,” said Mpofu.

Mpofu said:

All I’m saying is that, rightly or wrongly, there was a connection that was being proposed – whether it was genuine or not genuine is another issue – between the mandate of the Treasury and the failure to recover the money. There was that connection made in your time; it was made before Advocate Mkhwebane’s time. It was made to you.

Mpofu said discussions with former president Thabo Mbeki and former finance minister Trevor Manuel had indicated that the reason money was never recovered was to protect the economy. Mpofu said Manuel had further said that his primary role was to protect the economy against any potential risk.

READ: Mkhwebane suffers another legal blow in latest ruling against Pillay 

“So, when he says his primary role, he is talking about his mandate?” Mpofu asked Tshiwalule. Tshiwalule said he had been speaking about the mandate of the Treasury.

“Yes, of the Treasury which, broadly speaking, covers the Reserve Bank. The Reserve Bank falls on the monetary policy side. But he’s talking about the role of the state, so to speak. So would you, therefore, agree with me now, against this background, that there was – and, again, I must stress I’m not saying you agree with it – but there was a stated connection between the mandate issues of the state, ministry, of the Reserve Bank and so on and the failure to recover the money – whether it was a good or bad reason, that’s another matter – but there was a stated connection, correct?” asked Mpofu. Tshiwalule agreed.

“And that connection between the mandate of the Reserve Bank, among other things, and the failure to recover the money was made to you and Advocate [Thuli] Madonsela long before Advocate Mkhwebane was even interviewed by Parliament. Correct?” Again, Tshiwalule agreed.

Mpofu then said that Mkhwebane would testify that the connection between mandate issues “were not her invention” but something she already found at the office of the public protector.

READ: Mkhwebane impeachment: Witness told off during inquiry 

Tshiwalule said:

Yes, I would agree … There was an opportunity for her to probably not go with that, as she had done the other changes in the report. I’m sure that will be a proposition that will be accepted as well – that she had an opportunity to amend whatever it is that she needed to amend on the report. You and I agree that the final say rested with her in as far as the final report [is concerned].

Mpofu said Mkhwebane probably had not removed that part in the report because she had agreed with it.

“The only thing I wanted to illustrate is that this was not her invention. She found it there. And, as you correctly pointed out, she retained it. Voluntarily,” he said.

“So, this notion that she expanded or came up with all sorts of wayward angles to this is not founded by the evidence, because these statements were already in your documents long before she arrived – correct?”

READ: Mkhwebane impeachment: Mpofu suggests Gordhan influenced Pillay’s position as deputy commissioner at Sars ‘with just a matric certificate

Tshiwalule said they had been in the draft document.

He had also told the committee that, in December 2016, he had received an email from Mkhwebane asking him to do further research on other countries’ reserve banks and whether the states had any control over those. He said he looked at reserve banks in China, Nigeria, the US, Russia and Zimbabwe.

Adding that he had, however, done the research, he said: 

I must obviously clearly indicate that I did not understand this because there was no link between the complaint that came from Advocate Paul Hoffman and this request.

“But I didn’t understand where we were going with this, because the issue from the complaint had nothing to do with what she was asking. Nonetheless, I proceeded to do this research and look at how other central banks around the world deal with the issue of control in as far as whether they’re nationalised, state-owned or privately owned [is concerned],” he said.

READ: Mkhwebane impeachment: Committee raises questions about Arthur Fraser’s intervention at the Public Protector’s office 

‘Leak of the report’

Tshiwalule told the section 194 committee that, after leaving his job at the Public Protector, he had learnt that there had been a leak of the provisional CIEX report. After the leak, police had come to his new workplace to inform him that they had been investigating it.

“I was advised that Advocate Mkhwebane had opened a case about the leakage of the report and my name was mentioned when the complaint was made.”

He said he had had nothing to do with the leak. He said he had also been approached by the National Prosecuting Authority, to which he provided an affidavit. And police had come to his house to do a search.

He said:

They asked if they could conduct a search in my home for relevant documents. However, they did not have a search warrant and, accordingly, I refused to permit them to search my home. I have not heard of the investigation or its outcome since.

Later, when answering questions from MPs, he said he had felt “harassed”, particularly when police had come to his house.


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