In 2000, together with two other women, Nosipho Mfengwana started a small screen-printing business in her tiny two-roomed shack in a back alley of Crossroads, Cape Town. Without electricity or running water they persevered and their company, aptly named Vukani Bafazi (Awake, women), slowly prospered.
Three years later their tablecloths, aprons, place mats and pillowcases are for sale in a growing number of shops. They recently won a small contract to provide hand-painted fabrics to a local fashion company.
But in the winter months the rain still leaks into the shack. With no electricity they have to stop work when it gets dark. Without access to skills and finance they struggle to market their products and buying a small vehicle to transport their wares out of Crossroads remains just a dream.
Last week the Democratic Alliance launched its broad-based economic empowerment policy, ”Opportunity for All”, from Mfengwana’s fabric-painting workshop, still housed in her shack in Crossroads. The aim is to show that genuine and effective broad-based empowerment starts at grassroots level, reaching people who epitomise the kind of entrepreneurship that the government’s black economic empowerment policy should assist and advance, but sadly hasn’t.
Two fundamental concepts guide the DA’s policy: ”Equal opportunity for all” and ”merit not race”. They arise from the party’s commitment to democracy, equality before the law and the freedom, worth and dignity of every individual. Because the people who need and deserve empowerment are not the African National Congress cronies, the fat cats and wabenzi, but people like Mfengwana — and millions like her across South Africa.
With unemployment at 40%, job creation is the surest way of empowering the marginalised and the poor.
True empowerment tackles poverty, unemployment and inadequate education; is measured by job creation and entrepreneurship and comes from giving people access to skills, resources and opportunities to realise their potential. Broad-based empowerment starts with a non-racial ”bottom-up entrepreneurship” approach, not the ”top-down enrichment” of a few.
Effective broad-based empowerment doesn’t need to be racially based because addressing poverty, inequality, lack of skills and illiteracy inevitably has overwhelming benefits for people from historically disadvantaged groups.
Deracialising ownership of large, listed companies is clearly desirable, but is no substitute for the broad-based empowerment that comes from flourishing small and medium enterprises owned by previously disadvantaged people. Equity ownership can best be achieved by imaginative employee share option programmes supported by a helpful tax regime.
Empowerment criteria — such as race, gender and disability — should be ”plus” factors, but not the sole considerations, when appointments are made or contracts awarded. To do otherwise is to compromise on economic growth, service delivery and the minimising of poverty and inequality. Procurement policies should target small and medium businesses with potential and have the requisite competencies, rather than established, highly profitable and successful businesses.
Affirmative-action legislation should incorporate sunset clauses because there is always a danger that measures designed to protect or advance persons disadvantaged by unfair discrimination remain in place long after they have served their purpose.
Empowerment must complement, not compete with, the need for economic growth, which must reach 6% a year if seven million jobless South Africans are to find work. For this, our economy must inspire confidence and attract investment and this requires:
An economic empowerment strategy that is equitable, transparent, and measurable, not open to abuse by ANC cronies and frontmen and who will tie potential investors up in red tape, deterring foreign investment and shedding jobs;
A flexible labour legislation regime that encourages job creation by taking account of employers and South Africa’s unemployed, rather than merely kowtowing to organised labour; and
Widespread skills training and entrepreneurial development to reduce our current skills crisis and exempting scarce skills and professions from employment- equity requirements as well as opening them to foreign applicants.
Greater ownership of the economy by black South Africans is long overdue, but for millions participation starts with a job. As long as government focuses on transferring existing equity instead of transformation through economic growth and job creation, black economic empowerment will remain a short cut to wealth for the very few and a myth to those like Mfengwana who deserve and need it most.
MP Mark Lowe is the Democratic Alliance spokesperson on trade and industry.