Hon Chairperson, hon members, Ministers present here and Minister of Finance, let me start by reading from Marianne Williamson's A Return to Love which says:
Our deepest fear is not that we are inadequate. Our deepest fear is that we are powerful beyond measure. It is our light, not our darkness, that most frightens us. We ask ourselves, Who am I to be brilliant, gorgeous, talented, fabulous? Actually, who are you not to be?
The above extract from the book, and these words in particular, have become like nylon to us, signaling the change shining through the women who dared to challenge the barricades of social limitations which do not only restrict creativity, freedom and expression, but linger to affect every other area of an individual's wellbeing.
Before I confine myself to the report and recommendations of the Standing Committee on Finance to this House, allow me to salute, with respect, the relentless effort of our democracy in embracing the evident torch of light, achievements and paradigms demonstrated by the women of our nation in all spheres of life. The debate on the South African Reserve Bank Amendment Bill takes place when the entire country is celebrating the success of our efforts to liberate women from years of oppression suffered on the basis of their race, class and gender.
It is during this month that we assess the impact of our government's corrective policies and the positive effects that such policies have had in creating a national democratic society in which the women's role is at the centre of development.
The implementation of such corrective measures should not assume that the consequences of democracy will automatically translate into the eradication of patriarchy, which was and still remains the embodiment of economic, social, religious, cultural and other forms of oppression of women in a democratic society.
As we strive to create the ideal society that Tat'uMandela, Tat'uSisulu, together with many other heroes and heroines of our struggle, sought to create, we must never forget to appreciate the first steps they took to make us feel the need to rise even when we thought and felt that we did not have the means to make our case known beyond our borders. Through their courage and commitment, they made it possible for even the most hesitant to realise the need to challenge the everyday reality of life and struggle.
The demand for progress around this particular issue can be decoded in the loud voices whose echoes have broken the walls of silence in our economic corridors. This is a clear indication that time has come for us to honestly introspect the contributions that the financial sector has made in the feminist fight against poverty evident in the physical marginalisation, psychological abuse and the undermining of the potential of women. We must also assess how the sector has assisted in the redirection or lack of equal opportunities for women in positions of authority and power in the economy.
Most importantly, we must, from our political perch, focus on specifics so as to answer the question: Have the financial institutions succeeded in creating unambiguous structures, systems, as well as conducive cultural conditions that embrace the abilities of women so that they flourish and enrich the life of our nation?
The Minister has adequately dealt with the important role of the South African Reserve Bank, particularly in the economy, as well as the relevance of the amendments to the existing Act to address the challenges that the Reserve Bank has encountered in the past few years.
In the processing of this Bill, the committee had an opportunity to interact with various stakeholders, including some of the shareholders, through written and oral submissions. Once again, the committee, in processing this Bill, had to strike a balance between public interest and participation and the challenges that these amendments seek to address within a stipulated period in terms of the Reserve Bank regulations.
Members of the House will be aware of the debate in the public domain regarding the role of the Reserve Bank which has been going on in the recent past and now recently, since the publication of the Bill for public comment. Prior to the publication of the Bill, the debate was whether it is desirable to have private investors as shareholders in the bank or whether it should be entirely owned by the state. These questions arose out of the concern that private shareholders could use their shareholding power to influence the bank and monetary policies to the detriment of the nation and its interests.
Proposed amendments, among others, reflect on the composition of the board. Guided by making the minimum interventions in the Bill, the committee confined its work and aimed at ensuring that the substance of the key mandate of the Reserve Bank remains the domain of the Governor and the Deputy Governors of the Reserve Bank.
In this regard, the proposed amendment of the composition of the board gives effect to the separation of responsibilities between the executive and the board. In terms of the current legislation, as it stands, the board delegates the executive authority to the Governor of the Reserve Bank, which is not healthy. The amendments therefore ensure that the board remains focused on governance matters while the functioning and day-to-day activities of the Reserve Bank are the responsibility and the domain of the Reserve Bank Governor.
The Bill also proposes that four directors be appointed by the President in addition to those who will be nominated through the public process. It is our considered view that this will strengthen the board's functionality in observing governance matters in the day-to-day activities of the bank.
It is important to indicate that the Reserve Bank, unlike other commercial banks, is a statutory body that derives its mandate from the Constitution, which guarantees its independence from external influence. Therefore the role of shareholders is very limited and is outlined in the regulations.
It is in this regard that each person is allowed to own a maximum of 10 000 shares, irrespective of the size of their pocket or the institution that seeks to participate in the shareholding scheme of the Reserve Bank. This ensures that ordinary people can have an equal vote as ordinary shareholders in the bank in terms of the decisions that they need to make.
The consequence of the activities of the shareholders may result in narrowing public participation of ordinary citizens in the bank as some of them seek to manipulate share prices. Ordinarily, the issued shares of the Reserve Bank were, at the beginning, between R1,20 and R1,50. At the time of this amendment being presented before the committee, some of the shareholders had actually manipulated share prices to the value of R6 000 per share. That tells all of us that ordinary people are not able to be participants in the affairs of the Reserve Bank. It begins to be the domain of the few, the rich and those who are driven by nothing else but profit motives. [Applause.] Therefore the committee is in support of the establishment of the panel which will ensure that fit and proper persons will serve on the board.
How is this going to happen? The Amendment Bill seeks to establish a panel that will process nominations, and such a panel will be checked by the Reserve Bank Governor. A retired judge, three representatives from the National Economic Development and Labour Council, Nedlac, and one person appointed by the Minister will be part of it. Its responsibility is only confined to processing and interviewing those who will have been nominated to participate or to serve as directors of the Reserve Bank.
With regard to some shareholders who are opposed to the role of the central bank as defined in the Constitution, the ANC strategy and tactics direct us on how we should deal with these matters. They clearly outline that as we surge forward, the key question that should remain uppermost in our minds is: What kind of a society do we seek to create? In other words, what is the character of the national democratic revolution?
It is in this understanding that transformation will encounter resistance from time to time, precisely because colonialisation of a special type contained in itself contradictions which cannot be resolved through reforms.
The changes proposed in this Bill will stand or fall on the basis of whether or not it is able to eliminate the main antagonism of the system we currently have in the administration of the bank. Perhaps the question we need to ask now is whether or not the current form and structure of ownership of the bank, with private ownership of shares, is in fact desirable.
Given our history and our experience, which has now necessitated the amendment of the current legislation, it is significant to note that ours is one of the few - nine - central banks in the world that have this kind of arrangement, where private shareholders participate. Among the nine are Australia, Belgium, Greece, Italy, Japan, Pakistan, Switzerland and the