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BEE benefiting only a few

BEE benefiting only a few

Black Economic Empowerment (BEE) is becoming more narrow-based instead of becoming more broad-based, according to the Institute for Race Relations.

“Clearly a small group of beneficiaries are having their way at the cost of the many,” Dr. Anthea Jeffrey, head of policy research at the IRR told Talk 702 earlier this week amid new BEE proposals drafted by the National Treasury.

Under the new proposals, government tenders up to R10 million be evaluated only 50% on price, while the preferential weighting for BEE will also count 50%.

Carol Paton at Business Day noted this week that the government would pay a large premium on all procurement less than R10 million, under the new draft. The size of the premium will depend on how many points a company can score on the non-price factors to compensate for its higher price.

Read: How government plans to legalise corruption: Helen Zille

Olga Meshoe, a director at Transcend Corporate Advisors told Talk 702 that the new proposals is a step in the right direction to stimulate the economy.

The pricing will increase, Meshoe admitted, however, she said that one need to appreciate that for those with good BEE score cards, it means that those company were looking out for other communities, up-skilling workers and contributing sustainably to the economy.

“Entities that are now going to be tendering, with a good scorecard, it can be said that they are contributing to the broader conversation of transformation,” the lead of the BEE strategy consulting firm said.

She said that even though the pricing might be an aspect that South Africans have to pay for in the short term, the fact that black business was given an opportunity is a positive.

She said that while white owned business may be looked at in a less light, there are ways that they can contribute positively to BEE, and be in the running for government tenders.

The IRR’s Jeffrey, said there is a group of BEE proponents, who have pushed for many years for the BEE rules to be tightened up in various ways.

That, she said, has happened with changes to the BEE genetic codes happening earlier this year.

“They did say that the 10% weighting on contracts above 1 million was far too little – they believe it needs to be above 50%,” Jeffrey said.

She pointed out that The Department of Trade and Industry (dti) announced in 2014 that it wanted to create 100 black industrialists in the next three years.

“BEE is becoming more narrow-based instead of becoming more broad-based…clearly a small group of beneficiaries are having their way at the cost of the many,” Jeffrey said.

More on BEE

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BEE benefits blacks the least

BEE rules are getting stricter

How many BEE millionaires are in South Africa

BEE benefits everyone: ANC

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  • Xileer

    “the lead of the BEE strategy consulting firm said”
    “the fact that black business was given an opportunity is a positive”

    Is it even possible to get more biased? What next – A quote from the Financial director of Hulett claiming that Sugar is good for your teeth?

  • Frank Payne

    Gee whiz – you don’t say. I think it’s a rather obvious development to anyone who walks around with their eyes open. Let’s talk about how to change it rather.

  • BEE is merely an extension of being able to get ‘cadres’ contracts/ work,regardless of the inefficiency of that company. eg . Above. A co that couldn’t supply books to schools on time is now going to supply tablets and laptops!!

  • Rob Charlton

    BEE can/could only work for the general good if the economy was on an uninterrupted rising path of growth. Otherwise, sooner or later, any “deal” would go “underwater”. By its very nature, BEE is counterproductive in this regard. The very basis of it is flawed as a means for guaranteeing an improvement in the general good.

  • Umlazi

    The only thing we hate more than Racism is BEE!

  • Carpe Diem

    As far as Olga Meshoe is concerned, it is perfectly acceptable to blatantly discriminate against white owned businesses, because such discrimination will “contribute positively to BEE”
    She is equally comfortable with Government tenders increasing in price at the expense of the taxpayer, because black businesses are being “given an opportunity”
    This is all very reminiscent of the views prevalent during the apartheid era.

  • Valecia Supra

    Not surprised, when you lie about your qualifications, and are unable to step up to the requirement of the position, YES only a small number will benefit.
    BEE is also reversed racism, as qualified white persons are losing their jobs for BEE, and the companies are going down hill. Only a select few make a success, but then, they are honest

  • Chris

    Yes we all know this, and the only way you will benefit from BEE is if you are black and high up the ranks of the corrupt cANCer government.

  • Jonathan Pompies

    He he he… I like it… The more they try to drag the YT down, the more he will prosper…
    The more laws they make to disadvantage him, the more opportunities they create for him. Look how many WISP’s are popping up because of Telkom’s incompetence, look how many solar/ PV installers are popping up because of Eskom incompetence.
    Now I see they want to reduce the speed limits on roads down to 100km from 120km… The locust is just not able to operate at high speeds so they want to slow the rest of us down the the same level… more opportunities arise.

    Jy’t ‘n verstand gekry om uit die boks te dink, Jan…

  • Simon

    I wonder how many houses can be built for each 10 million rand tender that is 50% over inflated.

    Let’s benefit that “few”.

  • the-TRUTH

    The TRUTH is that this BEE is more of a curse instead of being part of a panacea to advancing socio-economic development – this is my view…

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