Black economic empowerment will be interpreted differently by the Western Cape government, which is now controlled by the opposition Democratic Alliance.
The DA is known for its critical view on how the ANC implements BEE, but will nevertheless have to implement legislation that steers the government to choose historically disadvantaged individuals when allocating positions and procuring services.
Chief among the DA’s criticism of the implementation of BEE by the ruling party is that the ANC uses BEE as a ”fig leaf” to cover up its policy of cadre deployment.
According to Helen Zille, the Western Cape premier and DA leader, the ANC’s concept of numerical representivity squares with that of apartheid prime minister Hendrik Verwoerd.
”We believe in diversity, not in the kind of representivity that says the population ratios need to be replicated on every level of society. That is a Verwoerdian concept. Verwoerd said the ethnic components of the population must be replicated in every other sector of society. He applied this to the ethnic components of the white population,” she said in an interview with the Mail & Guardian.
According to Zille, cadre deployment is the root cause of a failed state.
”We believe diversity is essential for excellence,” she said. ”Diversity that expands opportunities, not manipulate outcomes. They were putting people with political connections in key positions and then calling it BEE. We believe in ‘fitness for purpose’. That means you have to have the capacity to add value to the job.”
Zille’s scathing critique of the ANC’s BEE implementation comes from her experience when she took over as mayor of Cape Town in 2006.
”In the City of Cape Town my office was filled with people who wanted tenders.
”It was clear to me that tenders had previously been dispensed by the mayor, city manager and the person in charge of procurement. People thought unless you had a good connection with the mayor, you shouldn’t even put your hat in the ring. [Those who didn’t] were told, ‘don’t bother to come here, you won’t get the tender’.”
In 2004 the ANC acknowledged that the government’s implementation of BEE would not make a big difference to the economic outlook of most people in the Western Cape.
The preferential procurement policy, drawn up by the erstwhile provincial tender board after the ANC was voted into office, states that the procurement budget of R2,2-billion would contribute only 2.2% of Western Cape economic output and therefore not alter the economic development of the province significantly.
”Obviously, in this context, preferential procurement would not have any significant effect on influencing macroeconomic shifts in the local economy, specifically with respect to influencing overall growth, investment and employment,” the policy document states. It explains that preferential procurement is aimed at stimulating economic activity, protecting local industries against competition, improving competitiveness of industry sectors and promoting small businesses as well as correcting ”regional disparities”.
The DA-appointed provincial finance minister, Alan Winde, told the M&G that the government would still not be able to be a major force in using BEE to grow the economy.
”Government business is a small component of the economy. We have a budget of R30-billion and believe in a small but efficient government.”
Winde will not make major changes to the way procurement was done under the ANC, but vows to make the process transparent.
”We are bound by the national legislation on BEE, but there will be an openness of the procurement process,” he said.
Zille increased the participation of small business owners in the tender process in a similar way during her stint as Cape Town mayor. The BEE component of procurement went up by 10% because ”we were broadening opportunities”, she said.
Winde is in discussions with treasury staff to update websites listing tenders to make the tender processes more transparent. ”It must show which tenders were awarded, which companies got the tenders and who the directors are in those companies.”
He plans to focus on growing the provincial economy through local participation by re-energising the Red Door project started by the ANC government. The project gives small entrepreneurs the opportunity to receive start-up capital and support from government to open a new business.
”Some of these ideas are great, but privileged people go to the bank and poor people go to Red Door.
”I’m saying to business people, go and have a look at the business proposals and get involved.
”It makes good business sense because our economy cannot survive with the poverty we have now. We must foster a culture of venture capitalism in our communities,” said Winde.
With the allocation of positions, Zille is doing an audit of the work of the provincial government before employing more people.
”Currently in the provincial government we are busy establishing how things work, we are trying to find that out. With 72 000 employees across the province, it takes time. The ANC turns a job into a unit and employs six people to do one job so that cadres can get jobs. When I came into the premier’s office there were 23 communication professionals.”
Appointing people from various backgrounds will remain a priority of the Western Cape government.
”When we have worked out the functions we need in government, we will get people who are appropriately diverse,” said Zille.