Solidarity begins massive campaign to stop Rob

The Solidarity Movement, which includes Solidarity, AfriForum and Helping Hand, today launched a massive campaign to stop the recently proposed BBEEE codes announced by Trade and Industry Minister Rob Davies. In terms of the proposed codes, companies' socio-economic development contributions would only be recognised if 100% of the beneficiaries are black.

‘We are planning to send thousands of objections to Minister Davies. Twitter, Facebook, e-mail chain letters, SMSs and websites will be used to mobilise people on a large scale to object to the codes. People can send letters of protest directly to Minister Davies via the website www.solidariteit.co.za/en, and the campaign can be followed on Twitter at #stoprob. Protest can also be lodged simply by texting the word "Rob" to 34388,' Dirk Hermann, Solidarity's Deputy General Secretary, said.

The newly proposed code reads as follows: ‘The full value of socio-economic contributions made to beneficiaries is recognisable if at least 100% of the value directly benefits black people.'

Hermann says this approach does not constitute social responsibility, but amounts to social irresponsibility. ‘There is no justification to determine development contributions for needy people on the basis of race. A ten-year-old boy in an orphanage surely cannot be regarded as a beneficiary of apartheid. A nursery school in an impoverished area cannot be punished just because it takes in black and white children. Boys Town cannot be denied development contributions because they are offering a safe haven to a troubled white boy, and a company cannot turn its back on an old-age home regarding development contributions because a frail white granny is living there,' Hermann said.

‘To stipulate that 100% of the beneficiaries must be black is 100% wrong. This provision will not only be to the detriment of needy white persons, but also thousands of needy black people. If only 1% of the children in an orphanage are white, then the 99% of black children will also be disadvantaged. The codes are discouraging any form of integration. The codes therefore impose gross discrimination as a means of getting any support,' Hermann says.

The current codes stipulate that 75% of the beneficiaries have to be black and if less than 75% of the beneficiaries are black, then companies' socio-economic development contributions are proportionally recognised in accordance with the number of black beneficiaries. This proportional approach does not feature in the proposed codes, and the 75% of black beneficiaries has been increased to 100%.

‘The proposed codes have already been approved by cabinet. The 100% race-based approach therefore has the stamp of approval of the highest executive authority in South Africa. It is therefore not merely a poor formulation by an official,' Hermann said.

At the launch of the codes, Minister Davies described their purpose as follows: ‘We need to make sure that in the country's economy, control, ownership and leadership are reflective of the demographics of the society in the same way the political space does.'

Hermann is of the opinion that Davies' words bear evidence of a totalitarian mindset. ‘The proposed empowerment codes attest in their entirety to an obsession with race and with endeavours to achieve absolute racial demographic representation. Although the Solidarity Movement focuses on the socioeconomic spending side of the new codes for the sake of illustration, we fear that the codes are detrimental at many other levels, too. Such social engineering will enrich only a select few and, ironically enough, disadvantage ordinary black people,' Hermann said.

The public has until 5 December to comment, and the Solidarity Movement plans to flood Minister Davies's office with objections.

Read the letter to Davies and object to the codes via www.solidariteit.co.za/en/stoprob/

Solidarity's motivation against the codes - and the pro forma letter to Rob Davies:

On 5 October 2012 Trade and Industry Minister Rob Davies published amended broad-based black economic empowerment (BBBEE) codes in the Government Gazette (vol. 568, no. 35754). The Department of Trade and Industry (DTI) awaits comment until 5 December 2012.

The codes contain, among other things, amendments to the way in which companies can earn BBBEE points from spending on socio-economic development (SED). Company contributions to SED are now recognised for purposes of BBBEE, but only if 100% of the beneficiaries who directly benefit from a contribution are classified as generically black. If any of the direct beneficiaries are not classified as generically black, a company will not receive any BBBEE points for that spending. Trade and Industry (DTI) awaits comment until 5 December 2012.

The current codes

3.2 Socio-Economic Development Contributions

3.2.1 Socio-Economic Development Contributions consist of monetary or non-monetary contributions actually initiated and implemented in favour of beneficiaries by a Measured Entity with the specific objective of facilitating sustainable access to the economy for those beneficiaries.

3.2.2 The full value of Socio-Economic Development Contributions made to beneficiaries is recognisable if at least 75% of the value directly benefits black people.

3.2.3 If less than 75% of the full value of Socio-Economic Development Contributions directly benefits black people, the value of the contribution made multiplied by the percentage that benefits black people, is recognisable.

The proposed codes

3.2 Socio-Economic Development Contributions

3.2.1 Socio-Economic Development Contributions consist of monetary or non-monetary contributions actually initiated and implemented in favour of beneficiaries by a Measured Entity with the specific objective of facilitating income generating activities for targeted beneficiaries.

3.2.2 The full value of Socio-Economic Development Contributions made to beneficiaries is recognisable if at least 100% of the value directly benefits black people.

Implication

Under the current codes, companies can earn BBBEE points for their full SED contribution, provided that a threshold of at least 75% of the direct beneficiaries are classified as black. However, the amendment of paragraph 3.2.2 means that the full value of any particular SED spending by a company will only earn it BBBEE points if 100% of the contribution directly benefits black people. Should a single direct beneficiary be classified as white, the full value of the relevant SED spending will not count towards BBBEE points for the company any longer.

Furthermore, under the current codes, SED spending are recognised pro rata for BBBEE purposes if fewer than the threshold of the direct beneficiaries are classified as black. However, the deletion of paragraph 3.2.3 removes this pro rate provision.

The implication is clear: under the proposed codes BBBEE points for SED spending can only be earned if none of the beneficiaries are white. If any direct beneficiary of a project is white, none of the spending on black people will earn a company any BBBEE points either.

Unless companies find some way to sidestep these regulations, one can assume that they will tend to adjust their SED spending. They will redirect the spending with which they hope to earn BBBEE points to organisations that are able to show that none of the direct beneficiaries of the contributions are white.

The easiest way to understand the new codes is to picture Rob Davies as someone who wants to encourage the existence of blacks-only welfare organisations.

To: Trade and Industry Minister Rob Davies

Subject: Recently proposed BBEEE codes

Dear Mr Davies

I strongly oppose the recently proposed BBEEE codes that you announced recently. In terms of the proposed codes, companies' socio-economic development contributions would only be recognised if 100% of the beneficiaries are black.

Minister Davies, it is 100% wrong to stipulate that 100% of the beneficiaries must be black. This provision will not only be to the detriment of needy white persons, but also thousands of needy black people. If only 1% of the children in an orphanage are white, then the 99% of black children will also be disadvantaged. The codes are discouraging any form of integration and therefore impose gross discrimination as a means of getting any support.

This approach does not constitute social responsibility, but amounts to social irresponsibility. There is no justification to determine development contributions for needy people on the basis of race.

A ten-year-old boy in an orphanage surely cannot be regarded as a beneficiary of apartheid. A nursery school in an impoverished area cannot be punished just because it takes in black and white children. Boys Town cannot be denied development contributions because they are offering a safe haven to a troubled white boy, and an old-age home cannot be denied development contributions because a frail white granny is living there.

I repeat: the new proposed BBEEE codes are 100% wrong and attest in their entirety to an obsession with race and an endeavour to achieve absolute racial demographic representation.

I demand that the proposed codes be withdrawn.

Regards

Source: http://www.solidariteit.co.za/en/stoprob/

Statement issued by Piet le Roux, Spokesperson: Solidarity, November 18 2012

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