READER LETTER | State-owned bank another futile exercise

Instead of Gauteng premier Panyaza Lesufi focusing on assisting small businesses to expand and increase their revenue through doing business with the government, he now wants to establish a state-owned bank.

This idea was first mooted by former premier David Makhura in his 2018 State of the Province Address.

In 2022, Lesufi is making the same promise of establishing a state bank. A state bank that appears to be a duplication of the work that the Gauteng Enterprise Propeller (GEP) is doing.

In a recent reply to oral questions asked in the Gauteng provincial legislature, the premier explained that there are already several government entities that provide banking-like services in the province, such as GEP, the Township Economic Partnership Fund and the Gauteng Infrastructure Finance Agency.

Why establish a state-owned bank if Lesufi should only be focusing on ensuring that all these entities fulfil their mandate?

This will just be another waste of taxpayers’ money. Earlier this year, the Township Economic Development Act was signed into law.

State-owned financial institutions not only pose systemic risks to their economies but also threaten governments with potentially significant liabilities and with a need for a rise in taxes or reduction in government spending to make up for such financial shortfalls.

The DA is demanding that premier Lesufi gets his house in order and starts whipping entities that are not delivering on their mandate, instead of establishing new entities.

Adriana Randall, MPL, DA Gauteng shadow MEC for finance