Why Black Empowerment Has Failed
Earle this week I wrote an article about the new amended employment laws in South Africa for companies who employ more than 50 people. Those deemed to be in violation of the new regulations will be fined 2% of turnover or R1.5 million. These are not new laws as this has bee around since it was introduced in 2003. I think this is more about the government looking to find extra revenue by what ever means.
When Black Economic Empowerment was introduced back in 2003 no one envisaged we would still be dealing with this 22 years later. The problem is the system is floored and this will never work. I do believe with the Trump bashing SA received recently this will be part of the new trade negotiations and why there has been some new amendments. The economy is stagnant and suffering partially to BEE regulations and the main culprit being tax revenue not flowing back into the economy so there is no money flow.
BEE was put in place to help those disadvantaged in the past get a helping hand by becoming business owners/partners/directors in established companies. This is where the BEE score card used was doomed for failure right from the outset. The problem was so few blacks were educated prior to 1994 to any level that would deem them of use to a company let alone be a director or have any say. Those that benefitted from BEE ownership/directorship roles were merely a name on the paper and were paid even if they did not physically do any work. I knew a few directors who did just this and in the end they parted ways as it does not work.
The other problem was that the pool of black people this benefitted was so small and these were always those who had political connections. This was always about benefitting the few and not about uplifting the population. More effort should have been spent on skills giving the people necessary tools to add value to the economy. This has been left up to companies to upskill staff
When we revisit those that were previously disadvantaged how can someone under 31 years of age qualify as everything was all thigs equal from 1994. This is the problem facing this BEE employment regulation on who you can and cannot employ because there is o segregation in education like there was in the past. You could justify a 40 year old or 50 year old ever had the same opportunities, but not a 30 year old.
The government never really enforced the BEE regulations 100% because they were open to bribes and corruption and it s far too late to make this system work now. Education is still questionable and if an applicant has any promise companies would snap them up. Zimbabweans benefit more than the locals as they seem to have a better education and offer a wider range of skills.
You have to ask why there are 60% of people under 34 unemployed. Reality hits home when you realise the majority of the population struggles with the basics like literacy and thus have limited prospects. We had a case recently where our cleaning lady put a powerful detergent in the hand soap dispenser because she could not read the labels.
The biggest issue at the end of the day is the economy and not your skin color because a growing economy provides jobs for all. The education for everyone has to improve and not just the upper and middle class. Can the economy be fixed is the big question and as long as the masses vote the same political parties to power there will be no change. This I firmly believe was the governments strategy all along was to keep the masses uneducated so they cannot think for themselves and makes them easier to control..
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I would say that one of the largest inequalities that affect blacks is their inability to generate wealth. Wealth is not the measure of what you have made and purchased, but rather, the measure of what you have made and could purchase, but have not.
They had a lifestyle and a cultural ability to grow their own wealth when they live as they had done historically. They had villages with homes and buildings and cattle and farmlands.
This problem as described above with that massive population hike has nothing to do with them being black. The black population along with the low to middle income families of all the other culture/races all sit with the same problem: An economy run by a greedy elite that uses politicking to keep people focused on racial issues while their instillations and regulations ensure that the real power derived from the taxman is managed and distributed by themselves.
We need the ANC out. We need a government made up of educated and morally conscientious souls who wish to resolve the socio-economic problems in South Africa and not benefit from them.
I can not speak to the political aspect, because I am admittedly ignorant of these things. I only speak to what I observe from our own demographic. The ability is there. The will is not. They would much rather be given their needs without effort.
Indeed. One has to ask why they have this mentality...
I have never looked at it in this way before but I know they love to spend not caring about tomorrow or next month ad it could be down to education. I know someone who just bought a new car for $200k and has no insurance.
"Interesting points! But do you think better skills development alone would have changed the outcome of BEE, or were deeper systemic reforms needed?"
This is exactly the point. Focus and attention was not given towards skills development and education. So the masses stay uneducated and have increased their population to more than double, brining new uneducated or sub-educated population into the fold, part of culture identity that is the same as the current ruling class.
This has caused the uneducated to look up at the podium and see their own culture in the lead of the country and therefore give them hope that "Things will get better, we just need to hold on and be patient."
I have been in contact with both kinds of people. They are not the same. They are not equal and until the masses can see that, nothing will change.
Indeed. It was their intention to have a new elite take the place of the old government. Nothing has improved for the general people. It has only gotten worse.
https://www.reddit.com/r/economy/comments/1kaqq2b/why_black_empowerment_in_south_africa_has_failed/
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