Gigaba now faces the unenviable task of being seen to effect the ANC’s commitment to “radical economic transformation”.
The entire report in which public protector Busisiwe Mkhwebane demands that R1.125-billion given to Absa must be recovered should be overturned, finance minister Malusi Gigaba told the high court in Pretoria on Tuesday afternoon.
And the court is obliged to declare that Mkhwebane breached the Constitution in abusing her office as she compiled and defended that report, the Reserve Bank added.
In a fundamental misunderstanding of how contracts work, Mkhwebane had decided that that the government of South Africa should take orders from private British intelligence agency Ciex, advocate Tembeka Ngcukaitobi told the court on behalf of Gigaba.
“She flips the entire relationship upside down,” said Ngcukaitobi.
In her report on the Apartheid-era bailout of Bankorp, later acquired by Absa, Mkhwebane found that the government had failed in its duty to act on a Ciex report that said billions could be recovered from Ciex — with a percentage going to Ciex in commission.
That simply was not a conclusion she could have reached rationally, said Ngcukaitobi.
“She has elevated the Ciex report and elevated the Ciex agreement into a binding instrument, as if it were some kind of Act of Parliament. What she has failed to appreciate is that this was simply an agreement between the government and a service provider.”
The government was not required to follow advice it paid for, said Ngcukaitobi, as evidenced by the advice it regularly receives from lawyers, then ignores.
So it had been “totally irrational” to criticise the government for not following Ciex’s advice, he said.
This had been explained to her several times, but she had ignored those submissions.
Because of those and other failures, Gigaba has asked the court to overturn the entire Bankorp report rather than just striking down sections of it, as Absa and the Reserve Bank has asked.
But the Reserve Bank also wants a declaration from the court that Mkhwebane had breached her constitutional obligation to be fair and impartial, the Bank’s advocate Kate Hofmeyr told the court.
Considering the way Mkhwebane had gone about completing her report “we submit that there has been a breach of the Constitution by the public protector” said Hofmeyr.
If that is the case, the Constitution requires a declaratory order saying as much.
Evidence in support of such an order includes the fact that Mkhwebane discussed “the Reserve Bank’s vulnerability” with the State Security Agency (SSA), said Hofmeyr, as shown by handwritten notes of that meeting.
Although Mkhwebane’s office has a long-standing procedure to record and then transcribe meetings, there are no such records for the SSA meeting, and at least two meetings with the Presidency.
When she was challenged on whether one of those meetings (only disclosed after a legal challenge) with the Presidency had infringed on her independence, Mkhwebane instead discussed a second previously undisclosed meeting with the Presidency, said Hofmeyr. And in doing so she gave a “palpably false explanation”.
When similarly challenged on the SSA meeting Mkhwebane said nothing at all, so it could now be considered common cause that the discussion had been about Reserve Bank vulnerability, Hofmeyr said.
“We submit that these facts require a declaratory order from this court that the public protector has abused her office.
Mkhwebane’s team of five advocates are expected to respond to the arguments on Wednesday.