Page 67 - SARB: 100-Year Journey

1932
13 January 1932
The SARB releases a press statement about the gold standard and gives assurance it has substantial exchange resources and
is confident that it is able to handle the exchange position effectively.
27 and 29 January 1932
Parliament meets. The Union government seeks the establishment of a Select Committee on the Gold Standard.
22 February 1932
A Parliamentary Select Committee is appointed to resolve questions around the maintenance of the gold standard.
Between September 1931 and February 1932
An estimated amount of between
£13 million and £14 million left the Union of South Africa, according to evidence presented before the Select Committee on the Gold Standard by representatives of two commercial banks. The Committee’s own estimates placed the figures at between
£9 million and £10 million.
A gold mine in Johannesburg. /Getty Images
May 1932
The Report of the Select Committee on the Gold Standard recommends the Union of South African remain on the gold standard on the existing basis.
21 December 1932
Tielman Roos steps down from the Appellate Division of the Supreme Court to re-enter politics with the
aim of challenging the maintenance
of the gold standard. Roos was the former leader of the National Party
in the Transvaal. His re-entry to the Union of South Africa’s political scene posed a threat to the National Party’s majority in Parliament, which the party in government had used to ensure
the country remained on the gold standard.
23 December 1932
Speculation against the South African pound resumes, sparking a frenzy
of withdrawals of between £2.5 million and £3 million in three days.
SARB Governor Johannes Postmus writes to the Minister of Finance.
27 December 1932
The SARB, Barclays Bank, the Netherlands Bank of South Africa and Standard Bank address a letter to the Minister of Finance suggesting that, to avoid a crisis of the first magnitude, immediate steps should be taken to protect the Bank’s exchange and gold resources by suspending the convertibility into gold coin of Reserve Bank notes. They appealed for section 18 of the Currency and Banking Act 31 of 1920 to be suspended.
28 December 1932
The Minister of Finance issues a proclamation under the Finance Emergency Regulations Act of 1931 relieving the Bank of its obligation to pay its notes in gold coin on demand and making such notes legal tender for any payment by the Bank.
29 December 1932
The Minister of Finance clarifies that the Union has cut the link with the gold standard and the banks would be left free to determine the level of the South African pound in accordance with their exchange resources.
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