ANC treasurer general Mathews Phosa's statement that government will bail out banks is "dangerous and inappropriate", the Democratic Alliance said on Wednesday.

Phosa, who was an ANC party official with no position in the government, had promised bailouts to South African banks should the world credit crisis hit South Africa hard, DA spokesperson Kobus Marais said.

"The livelihoods of all South Africans hinge on our country being able to navigate its way through the world financial crisis, and jumping the gun with promises that he is not in a position to fulfil is dangerous and inappropriate."

Respect boundaries

He called on Phosa to respect the boundary between the ANC as a political party and its role in government, and leave the job of managing the economy to Finance Minister Trevor Manuel.

Bailouts had been an unpleasant but necessary evil in the United States and Europe, Marais said.

If the debt repayment crisis continued to intensify, there might well be repercussions for South Africa's banking system, which had so far been mostly immune.

In such circumstances some policy interventions would be essential to preserve the life savings of South African citizens, preserve jobs, and keep the economy going.

"But the decision about intervening in the banking system is one that the minister of finance must make, after due consideration of all the facts, and after appropriate consultation.

Jumping the gun

"By jumping the gun, with a promise that has been neither properly debated nor officially sanctioned by the Finance Minister, Phosa is building up potentially risky expectations on the part of both bank users and banks themselves," he said.

Phosa was also undermining the credibility of any future rescue package that might become necessary by creating the impression that such a package would be based on politics rather than sound economics.

For as long as the ANC had been in government, it had struggled to draw the line between party and state, and many promises made for political expediency had turned out to be impossible to implement in practice.

"Phosa should not risk our economic sustainability by falling into this trap," Marais said.

On Tuesday, Phosa said were SA banks to come under pressure, the government would intervene strongly to protect them.

The National Treasury has declined to comment on Phosa's remarks.

Sapa