The Democratic Alliance (DA) is facing a backlash over its plan to table a bill scrapping the country’s broad-based black economic empowerment policy.
The war over BEE intensified this week, with the ANC calling the proposal to do away with it “mad”, “nonsense” and “unconstitutional” and vowing to oppose it in parliament, setting the two biggest parties in the fragile government of national unity on course for a fresh fallout that could sound the death knell for the pact.
The coalition put together by President Cyril Ramaphosa after the ANC lost its parliamentary majority in last year’s general elections has teetered on the brink several times as the parties clashed over the national budget, black empowerment, land expropriation, the National Health Insurance as well as admission and language policies in schools.
The DA this week announced that it would seek support from the ANC and its other partners in the government of national unity (GNU) for the Public Procurement Inclusive Bill to replace what it said were years of ineffective empowerment policies that have left the majority of South Africans unemployed, impoverished and hopeless.
But ANC treasurer general Gwen Ramokgopa told the Mail & Guardian the proposed bill would be unconstitutional and her party would never support it.
“That’s nonsense because it is a constitutional mandate. The constitution says to redress the past inequalities,” she said.
The broad-based BEE policy allows for preferential treatment in government procurement processes to businesses which contribute to black economic empowerment according to measurable criteria, including partial or majority black ownership, hiring black employees and contracting with black-owned suppliers.
ANC Youth League president Collen Malatji said the proposed bill was a clear indication that the DA was a racist organisation that refused to accept the reality of apartheid and did not believe in being led by a black leadership.
He said the DA was against affirmative action, including BEE and other progressive policies aimed at addressing the injustices of South Africa’s past.
“This further confirms that any black person who votes for the DA, there is something wrong with them upstairs — including members of parliament who are black in the DA — because it is clear that the DA is anti black,” Malatji said.
“The black people who are in the DA are no different from the black police who killed black people under apartheid. There is no way that the ANC will entertain such a clownish proposal,” he said.
The ANC should stand firm against the DA “even if they don’t vote with us anymore, than support policies that are anti-black”.
This was a reference to the clash between the two parties earlier this year over the national budget tabled by Finance Minister Enoch Godongwana, which culminated in the DA forcing the ANC to scrap a proposed increase in VAT.
The DA also flexed its muscle as the second-largest party in the GNU by threatening not to support the higher education department’s budget if President Cyril Ramaphosa did not fire corruption accused minister Nobuhle Nkabane.
Again, the ANC caved in, with Ramaphosa axing Nkabane in July. She had been under fire for allegedly lying about the process of appointing Sector Education and Training Authorities (Seta) board chairs.
Some in the ANC fear the DA might similarly get its way with the Public Procurement Inclusive Bill.
The uMkhonto weSizwe (MK) party of former president Jacob Zuma, which replaced the DA as the official opposition, has also signalled its intention to defeat the bill in parliament.
MK party head of presidency Magasela Mzobe said scrapping BEE would be against the interests of black people and the project of redressing the legacy of apartheid.
“We don’t know how the ANC will vote because they are in the same government; it is for them to explain what they agree on,” he said.
“To us, the GNU is proposing the scrapping of BEE and, as an official opposition, we will oppose that.
“As to whether the ANC votes with us or their government as partners, we will only know that in parliament,” Mzobe
ANC Veterans League president Snuki Zikalala said BEE was a principle that the party would not be willing to compromise on, even if the DA used the same tactics it had to win the fight over VAT.
“They must not play with us; we are not scared of them pulling out [of the unity government].
“We are not compromising at all because we are addressing the past economic imbalances. You can see white people are richer than black people,” Zikalala told the M&G.
This week, Ramaphosa told journalists that, while he had not seen the DA proposal, “at the moment, the BEE policies, legislation and regulations as they stand apply without any dilution whatsoever”.
“We will continue to insist that the BEE process of transforming our economy is the correct approach to transform our economy to make sure that the participation of our economy in our country is inclusive,” the president added.
During a meeting of the ANC’s national executive committee (NEC) earlier this month, part of the discussion was on BEE and the party’s continued support of the policy. In his closing remarks, Ramaphosa said that the NEC had reaffirmed its commitment to it.
But DA head of policy Mat Cuthbert said public opinion on BEE had changed and it was in the interests of the ANC’s own electoral fortunes to support the Bill.
“We need reform in this space. If we are actively putting in place transformation policies that are not uplifting the people that they purport to uplift, we are strangling our economy from growing, then we’ve got to say to ourselves, ‘Well, we can’t keep on doing the same thing over and over again and expecting a different result,’” Cuthbert told journalists.
“Most importantly, it’s about shifting the conversation within parliament, about shifting the conversation within the GNU.
“It is not a stationary thing for the GNU; it’s a constant site for political contestation, for policy contestation, and for us to make sure that we are able to influence the policy agenda within the country.
DA federal chair Ivan Meyer described BEE as state-sponsored corruption, theft and fraud by “cadres”, designed to enrich only a few politically connected people.
“BEE makes people poorer and we have evidence of that. In the last 30 years, BEE has made ordinary South Africans poorer and we know it is a painful experience for people to get a job where it is possible to get the job with the right policies.
Meyer said the Public Procurement Inclusive Bill aims to create a procurement system that encourages genuine economic empowerment by offering incentives for tangible developmental outcomes such as job creation, poverty reduction, skills enhancement and environmentally sustainable practices.
“Furthermore, the transitional measures in the Bill include the winding down of the BEE Commission over 12 months and the systematic removal of references to BEE across legislation.”
To give effect to this change, the Bill empowers the minister of trade, industry and competition to develop a simplified preference points system based on a supplier’s demonstrated contribution to inclusive development and social impact.
The Bill however, does not say how the injustices of the past would be addressed by empowering previously disadvantaged groups, which mostly include black South Africans.
Cuthbert said the DA’s approach to empowerment fundamentally differs from that of the ANC — while the latter’s policy is only for cadres, the DA’s demands have no political connections.
“The DA may be in coalition with the ANC in government, but that doesn’t mean we need to agree with them all the time.
“We are in the GNU to represent the interests of all South Africans, and we will not relent,” he said.
This week, the National Empowerment Fund (NEF) — a government agency established to promote and facilitate black participation in the economy — said while it welcomed robust debate on how to strengthen transformation, it rejected the notion that removing race as a determining factor would advance inclusive economic growth.
“Since inception, the NEF has approved over R15.5 billion to black-owned and managed enterprises across all provinces.
“A recent independent study confirms that for every R1 invested in transformation projects, the NEF generates R2.21 in economic return, with additional transformation gains reflected in enterprise growth, skills development, and community upliftment,” it said in a statement.
The fund said that this showed tangible progress in transforming the economy.
“Between 2023 and 2025, the NEF extended funding to enterprises across key growth sectors, ensuring that empowerment capital reached the grassroots of the economy — with over 70% of township enterprises and nearly half of rural businesses reporting that NEF support directly contributed to their sustainability and expansion.”
The fallout is the latest threat to the fragile government of national unity that has frequently come to the brink of collapse over policy clashes between its two largest parties
