The Inclusion Of Black Empowerment Within South Africa

in Commentary

The execution of Black empowerment in South Africa started with first democratic elections in the country in 1994, when Nelson Mandela, the president of the ANC, was chosen as President. This was the political liberation of the black population.

The ANC government, however, realised that without economic freedom and black empowerment in this connection, the country would face revolt at some point. So, in 2001, the concept of Black Economic Empowerment (BEE) was tabled and a model thereof applied. The model had 7 pillars, but only two were obligatory or known as direct empowerment, i.e. equity ownership and management. This led to a flurry of economic and commercial action. Virtually instantaneously a few blacks became loaded individuals through JSE listed share transfers and deals on one hand, and on the other white owned business scurried to employ black management in order to abide by government tender requirements. Both issues transpired not to have had the required effect of black empowerment, but for a number of privileged. On the equity issue some people who in the main were well associated ANC individuals became very wealthy without any overspill to the black masses. Of those blacks selected to management positions in certain white controlled companies, ended up to often be token appointments, also due to a lack of any successful leadership development training by the appointees. A few of these individuals were paid huge salaries without being able to contribute much to the company, as they were quickly identified and had little impact in the giving of tenders.

Reacting to wide-spread criticism of BEE, the government in 2003/4 launched an amended model called Broad Based Black Economic Empowerment (B-BBEE) where equity ownership and management only measured 30% of the total rating in the model, thereby efficiently putting pay to the previous grievances of "equity stripping" by a few individuals, who were also criticised by government for not being true enterprisers creating work opportunities.

The new model promoting black empowerment, was broadly accepted but also criticised as being difficult to attain due to the variables to be achieved, particularly on the issue of employment equity. The critique from organised business was not so much the issue of employment equity by itself but the difficulty in execution, based on racial "quotas". In many cases there basically were not enough people of colour that were certified to be appointed. In the case of generic businesses (big business) they over a 5 year period had to achieve a workforce consisting of 43-80% blacks (black Africans, coloureds, Indians as well as women and disabled persons in the mixture). This policy also led to large scale retrenchment of white employees in the public and private sector, which obviously caused an outcry of the affected individuals, which did total very many. This is still not a very popular aspect of the B-BBEE model, although the going seems much smoother and more successful as time goes by.

With some 23% of the inhabitants without a job and 16M individuals receiving grants paid for from the tax base of only 6M people, it is apparent that something had and still has to be done to fairly distribute wealth in the country.

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Janet Marksen has 11 articles online

Janet is a freelance article author and website manager for internet websites along the lines of who shares knowledge about subject matter like black empowerment.

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The Inclusion Of Black Empowerment Within South Africa

This article was published on 2012/05/24
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