Mining charter is caught between two elite classes

Mining legislation reflects the aspirations of emerging elites at the expense of a largely black, poor working class and impoverished mining communities (Mike Hutchings/Reuters)

Mining legislation reflects the aspirations of emerging elites at the expense of a largely black, poor working class and impoverished mining communities (Mike Hutchings/Reuters)

First and foremost, there are “black” people whose social mobility into the elite and middle classes have not been contingent on the form of BEE being discussed.

Under the guise of transformation, the state has attempted to change the face of capital accumulation in the post-apartheid era, and there have long been questions about whether black economic empowerment (BEE) policies have been successful in changing wealth distribution.

But what is certain is that the government has played an active role in creating a class of capitalists closely aligned to the state through these policies. This has seen an accumulation of wealth among current members of government with access to business, former politicians and others who have formed part of the state’s patronage network.

READ MORE: South Africa walks mining tightrope

The end of apartheid saw the emergence of a “black” elite whose accumulation was predicated on their alignment with “white” business entities, whose accumulation of wealth rested on finance, mining and related capital-intensive industries, the mineral energy complex.

Business elites aggressively sought to absorb emerging “black” capitalists as an insurance against the possibility of nationalisation and other more radical reforms that threatened their interests. This manifested itself in the form of transfers to a handful of “black” individuals with close proximity to the state, albeit attached to a significant amount of debt, either through directorships or preferential shares.

But, as Nimrod Zalk, in New Agenda: South African Journal of Social and Economic Policy, issue 63, pointed out: “The phenomenon of BEE emerged out of the corporate sector before becoming entrenched in government policy and taking on forms unanticipated by and ultimately beyond corporate control.”

Mapping the structure of the post-apartheid economy, we see how these emerging and entrenched elites engaged each other antagonistically in the post-apartheid political economy. Consider the manner in which emerging “black” elites, through the Mineral and Petroleum Resources Development Act and the mining charter, have attempted to wrestle control from previously entrenched elites in the mining sector.

The Act and charter raise serious questions about whether the government is seriously seeking to address patterns of ownership in the sector. Although the charter is being redrafted (again), previous iterations appeared to be focused more on elite reshuffling in the industry rather than on addressing the economic imbalances of the past and opening up the industry to broader “black” participation and not a handful of politically connected elites.

The legislation seeks not to deracialise wealth or to ensure that the most vulnerable people are able to share in the fruits of the country’s mineral resources. It is an attempt by an emerging capital group to displace entrenched elites in the mining and energy sectors. The legislation will benefit those who are close to government at the expense of those who accumulated wealth under apartheid.

This is not transformation, it is reformation. The legislation reflects the aspirations of emerging elites at the expense of a largely “black”, poor working class and impoverished mining communities. Minister of Mineral Resources Gwede Mantashe himself professed that “the mining charter and other BEE programmes are in place to create “black” capitalist elites”.

The structure of the industry remains the same: conglomerates seek to extract mineral resources at the lowest production rate to secure profit, with little regard for the broader social implications. The exploitation of a largely “black” working class is not less abhorrent when it occurs under the auspices of a “black” elite. This is surely not what we intend transformation to be.

It is difficult to contemplate how the ANC can navigate and appease the various interest groups while making a concerted effort to restructure the economy and the mining sector in a way that will ensure that impoverished mining communities are empowered.

READ MORE: How to ensure communities living near mining activities get a better deal

But a great opportunity has presented itself. A re-evaluation of the mining charter, which will put the interests of the most vulnerable first, should be the priority of the ANC. There is a dire need to ensure mining is properly governed and regulated to ensure the safety of workers — this year 21 people died at Sibanye-Stillwater mines in Gauteng and six at Palaborwa Mining in Limpopo — and to restructure employee-employer relations, and to ensure that mining becomes a source of sustainable mineral extraction, which will allow mining communities and their environmental surroundings to flourish.

This emerging “black” elite will also need to be put under pressure to provide the climate for sustainable resource extraction because it will not come about through market forces.

I certainly hope the final amended mining charter will advance a programme for a better life for all.

Bongi Maseko is an associate at the Institute For African Alternatives

Bongi Maseko

Bongi Maseko

Bongi Maseko holds a BSocSci degree from the University of Cape Town in politics and international relations. He is currently in his penultimate year of a LLB degree and an intern at the Institute for African Alternatives, publisher of New Agenda: South African Journal of Social and Economic Policy.   Read more from Bongi Maseko

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