Broad-based black economic empowerment is not an optional policy experiment but critical for redressing centuries of colonial conquest and apartheid exclusion, Deputy Minister of Planning, Monitoring and Evaluation Joel Mohai says.
“To oppose all remedial measures is to misunderstand the democratic settlement,” Mohai said at the B-BEEE Symposium at the University of Johannesburg on Tuesday.
The policy has recently come under fire, with billionaire Elon Musk calling it “extremely racist” after his Starlink company continued to face challenges in securing a licensing permit.
Starlink has been in a deadlock with the government, which requires all companies to cede 30% ownership to historically disadvantaged locals.
Mohai said President Cyril Ramaphosa had set out the government’s position in his State of the Nation address when he stated: “Now is not the time to abandon B-BBEE, now is the time to make it effective.”
Mohai debunked “several misleading narratives” about the policy, which he said forced citizens to choose between economic growth and inclusion, adding that exclusion weakened demand and narrowed the income base.
The notion that “because implementation has flaws, the principle itself must be discarded” was not correct, he said, adding that his department had been confronting superficial compliance. “Implementation failure can never be an excuse for the miscarriage of justice.”
He said opposition to the policy had distorted reality by stating that broad-based BEE had benefited a few.
“It is equally true that many of the black South Africans who rose in business through empowerment opportunities have had no relation whatsoever to the African National Congress,” he said.
Mohai credited the increase of black enterprises to “professional excellence and competitiveness” and discredited “the false narrative of empowerment and inclusion as discrimination”.
He said his department faced “subtle resistance to delays” and “procedural obstruction”. South Africa “cannot afford a political posture that seems to ignore historical exclusion”.
“Many black-owned firms remain trapped as subcontractors and are undercapitalised,” Moha said, noting that land access alone was insufficient without water rights, capital and market access.
Mohai called on the Industrial Development Corporation, the National Empowerment Fund, the Development Bank of Southern Africa and the Land Bank to increase development lending to productive black-owned enterprises.
“As a government, we are aware that B-BBEE is not a panacea to all of our problems; for it to be effective, it must be integrated with industrial access,” he said.
The commissioner of the Broad-Based BEE Commission, Tshediso Motona, said the policy had reached 70% ownership achievement across 758 deals, while facing “serious data challenges”.
Board-based BEE had secured R615 billion in assets acquired for black ownership — although funded by debt — with an additional R119bn towards skills. Motona said the commission had studied 28 131 broad-based BEE score cards and noted the lack of information on impact.
“The certificate does not give you the impact, although valuable,” he said, adding the scorecard should move from money-centric measurement to highlight impact on skills and sustained black enterprises.
He said compliance levels had increased since the commission was established in 2003, with an increase in the share of companies achieving levels 1 to 4, mostly within construction and transport. Sectors such as mining and agriculture lagged behind.
“Why are we not achieving scale? The answer lies in implementation.”
Montana said skills development had “flatlined” with no “radical trajectory” to improve labour capability in a country that had high unemployment figures.
“Skills development is not moving, it’s stuck, it’s stagnant, which is surprising because of the great skills challenge.”
Over the past 20 years, the commission has received 1 550 complaints — 84 of them related to companies fronting as black-owned, particularly within mining and construction.
“Black people have hit a ceiling in terms of management but of course, board representation is not fully transformed,” he said.
Officials said that while black empowerment faced implementation challenges, it remained central to government’s economic inclusion objectives