Sara Gon says it is wrong that the children of billionaires should profit ahead of the poor
Figures show ‘disadvantage’ is the proxy for disadvantage
The Democratic Alliance (DA) says that its Black Economic Empowerment (BEE) policy is based on the premise that ‘race’ remains a proxy for ‘disadvantage’.
To this, Frans Cronje, CEO of the Institute of Race Relations (IRR), responded: ‘You do not need a proxy, let alone the proxy of race, to determine disadvantage because disadvantage itself can easily be determined, measured, and assessed.’ (‘DA playing a dangerous game with BEE’, BusinessLive, 13 February).
Two days earlier, Cronje had criticised the DA for retaining race as a proxy for disadvantage (‘B-BBEE: The DA again surrenders to the ANC, Politicsweb, 11 February).
The response on Twitter from the DA’s Shadow Minister of Communications, Phumzile Van Damme was: ‘You are no longer a “think-tank”, @IRR_SouthAfrica& just driven by bitter, malicious people bent sowing seeds of disinformation based on personal gripes & settling scores. You’re no better than a propaganda bot right now. Do better, you’re damaging your own credibility.’
To which Max Du Preez, veteran journalist and editor, tweeted in response: ‘I tend to agree. IRR has become a polite, English-speaking version of AfriForum.’
All that the IRR has done is to have expressed its genuine, classically liberal principles, and displayed the imagination not to hold the ANC’s Broad-Based Black Economic Empowerment (B-BBEE) policy as sacred dogma.
If race is a proxy for disadvantage, then the heirs of a Cyril Ramaphosa or a Patrice Motsepe will always be entitled to benefit from B-BBEE – they’re black, thereforethey’re disadvantaged. This can’t be right.
The ANC’s policy has also been criticised at various times by Moeletsi Mbeki, the South African Communist Party, Mathews Phosa, Pravin Gordhan, Gwede Mantashe and Dr Mamphela Ramphele.
The Equality clause (Section 9) of the Constitution prohibits unfair discrimination, but subsection (2) allows ‘legislative and other measures designed to protect or advance persons, or categories of persons, disadvantaged by unfair discrimination’.
This has resulted in the Employment Equity Act of 1998 and the Broad-Based Black Economic Empowerment Act.
The Equity Act governs the implementation of affirmative action at the workplace for employees and applicants for employment. It provides that affirmative action measures can include numerical goals, but not quotas. In using ‘national demographics’ to achieve representation, goals have in effect become quotas. Nowhere in the world do all job categories represent the exact demography of a country.
The Empowerment Act promotes economic transformation to enable meaningful participation of black people in the economy; change in the racial composition of ownership and management structures, and more. The well-off elite largely continue to be enriched; compliance is time-consuming, often difficult to achieve; and expansion and investment are hindered.
The public sector often states specifically in job adverts that ‘Blacks only need apply’. Sometimes there are no black applicants, but in order to meet increasingly rigid quotas, the post is then either withdrawn or just not filled.
The government’s new youth employment initiative, Yes4Youth, is an online portal for work-seekers to apply for jobs. The government then refers the applications to a range of corporate partners for potential employment.
In order to confirm that the applicant qualifies for the service, the first step asks whether the applicant is Black, Coloured or Indian. Selecting “no” produces a pop-up which says: “I’m sorry. YES is only available to Black, Indian, or Coloured South Africans who are 18–34 years.”
Yes4Youth appreciates “how difficult the job-seeking journey is for people of every race. However, Yes’s approach aims to redress the skewed economic realities created by South Africa’s past”. (‘Unemployed white South Africans blocked from registering on government jobs website’, MyBroadband,Staff Writer 30 October, 2018)
The tables below suggest that discrimination against white youth is just an unfair and unending policy of retribution.
The IRR’s proposal is Economic Empowerment for the Disadvantaged (EED). EED aims to improve the lives of poorer people through rapid economic growth, excellent education, more employment, and the promotion of successful entrepreneurship.
Businesses would earn points for contributions of different kinds – the investments they make, the profits they generate, the jobs they sustain or create, the suppliers they support, the innovation they foster, and the contributions they make to tax revenues, export earnings, and foreign currency inflows. EED would create opportunities for all.
EED will be based on means-testing: those earning below a certain amount would be entitled to government-funded vouchers, which they could use to access education, healthcare and housing. People would no longer have to rely solely on government services. This would give people more choice.
Since the IRR’s proposal is not based on race, but on circumstances, some of the beneficiaries would be white –but our tables below show that the number of whites who may benefit would be so small as to be inconsequential and would take nothing away from the black poor.
We have looked at the age groups most likely to be affected by affirmative action. The figures are instructive.
Number of people in the 15 – 34 age by population group at 2018*
Population group ages 15 - 34
% of population ages 15 - 34
*Socio-Economic Survey of South Africa 2019 from figures provided by Stats SA, mid-year population estimates 2018, Statistical Release p0302, 23 July 2018, Table 6, P10.
The number of people living in poverty by population group of all ages in 2015**
of people living in poverty of total population
% of people living in poverty to total population
% of people living in poverty to total population of the poor
**Determining the number of poor people is very difficult. Poverty is divided into a number of categories, therefore it is difficult to calculate the total number of poor. The most recent figures we could find are for 2015. Source: FACTSHEET: South Africa’s official poverty numbers, Africa Check, Researched by Kate Wilkinson, 15 February 2018
Overall, 94,8% of people between 15 and 34 are black and 5,1% are white. BEE as it is practised currently can only be unfair discrimination against young white people born between 1985 and 2004.
When it comes to improving the life of the poor, the situation is even more absurd.
The percentage of white people in poverty as at 2015 was 0,09% of the total population and 0,16% of the total population of poor. The number of whites who would be beneficiaries of EED is so negligible that continuing to base BEE on race as a proxy for disadvantage, is in every way, unjust.
Sara Gon is a Policy Fellow at the Institute of Race Relations (IRR), a think tank that promotes political and economic freedom. Readers are invited to take a stand with the IRR by sending an SMS to 32823 (SMSes cost R1, Ts and Cs apply).