Below is an interview Political Analysis South Africa’s Stephanie Naidoo had with Adv. Anton Alberts, a Freedom Front + (Vryheidsfront Plus, FF+) Member of Parliament and the Portfolio Committee on Trade and Industry in Parliament, on disadvantage as a result of transformation, specifically Affirmative Action and Black Economic Empowerment. According to the Freedom Front Plus, “during a parliamentary question by the Party over the negative effect of transformation, President Zuma commented that he knows of nobody that was disadvantaged by transformation. The Minister of Trade and Industry, Minister Rob Davies, also claims that no white individual has been impoverished by BEE.”
Interviewer: A petition was previously launched by the Freedom Front Plus titled “say no to discrimination” in response to claims that transformation has not had a negative impact on any individuals. Please could you elaborate on this, and explain the context of the petition?
Hon. Anton Alberts: The petition on being disadvantaged by transformation was launched three or four years ago, but we obviously are still getting information from people who are disadvantaged and we also know that the DTI is now, for the first time, trying to make sure that they have data on the effects of BEE on the market because, they did not have that before. What I did say to them was that they cannot implement a policy without having sufficient information on the effect it will have on the market. People might lose jobs, as a result.
I sit on the Portfolio Committee in Parliament, on Trade and Industry, so we deal with BEE and BEE dispensation, directly, in all the Regulations. And, the fact is, when they amended the BEE Act in order to, what they call, strengthen the Act and make it even more stringent, we were opposed to that. Because, we said to them that they do not have sufficient information about the effect this will have on job creation; it might even destroy jobs in the process. And, they conceded that they do not have information about what the effect of BEE would be, especially a more stringent BEE. And, they were also, basically caught out, that even after how many years that they have been implementing BEE in a certain form, they do not have data; they have not collected data, on who has transformed, who has not transformed, does it create jobs, does it destroy jobs, what the real effect of this is. And, it is not a question of whether it is well-intentioned or not, it is a question of “what is the effect of the decisions you make, in real life?” – They did not have that information at hand, and they still went through and amended the BEE Act and made it more stringent. And our research, and the research of various other think tanks, such as the Institute of Race Relations, shows very clearly, that BEE is harming the economy; it puts a strain on the economy, it puts a disincentive on companies spending any more money in the economy – so they are rather saving the money, or they are taking the money elsewhere in the world, and not spending it in South Africa, because of this. And, it is destroying many, many job opportunities, and taking away many potential jobs, which could have been created.
The project that you are referring to, was a project that was basically launched at the same time that the BEE Act was being amended, but that is now a couple of years down the line already. And, we are still fighting this matter, and we believe that BEE, as it is implemented right now, is not a proper developmental instrument and that there are other developmental instruments to allow access for people who did not have access before, and at the same time grow the economy. Because, at the same time, one problem that we do have, is that government is continuously “rearranging the deckchairs of a Titanic;” they are not growing the economy, they are just redirecting resources, in other directions, while the majority of people are still suffering. So, in order to save everyone, you have got to make the ‘ship’ bigger, and they are not doing that; in fact, the ‘ship’ has got a hole in it, and it is sinking, as it is. And, that is very disconcerting for us; and we all see that under the guise of BEE, many people have been filling their pockets, and stealing left, right, and center – with the Gupta’s, and State capture, now at the forefront. And, we see how they have done it – they have used BEE methodologies to get into the system, but they were only enriching themselves and a handful of people, and definitely not broad-based. So, Broad-Based Black Empowerment is a pipe-dream; it is just a lie – it is not really broad-based, at all. And, we believe that there are other policies that can be used, that will actually get assistance and help, to the poorest of the poor, much quicker than they are doing at the moment – which is just an enrichment game for the current governing elite.
As you explained, the petition took place a few years ago. Was there a substantive outcome, and indeed, what do you believe a substantive outcome would be?
Well, there was not, because the government is continuing on the same route it is, and in fact, increasing its speed on that road, which will just lead to a calamitous crash, in the end. Even the designers, the people who advised on the original policy on BEE, for instance, one of the consulting firms called Rothchilds, came to the hearings on the amended BEE Bill, and said “when we designed this, we thought it would work, this way, and we are now seeing that it is working in a different way; we are now quite concerned about the route it is going, and we are actually saying that we must take everything off the table, and redesign the whole thing because, what we have now is not working.” They were the government’s advisors in devising the original BEE Act. As stated, they changed their position completely during the hearings on the BBBEE Amendment Bill in 2013 and wanted BBBEE to be scrapped completely and a whole new developmental model created. This was a scathing indictment from the creators of the empowerment model, yet was ignored by government.
So, if the designers, who advised government when they initiated the first BEE process, come to Parliament and say “this thing is not working” – then somebody should pick up and listen. But, nobody cares, because they are driving an ideological process whereby they are just bamboozling the public at large, and saying “we are doing something, it is called BEE, and it will empower you one day” but, most of those people will die at work – they will never see any empowerment, it is just a lie. So, it is clear that this system must be scrapped as it is. We must go back to a system where businesses feel that they are comfortable within the economic environment that they are in; that they have policy space, and safety, to spend their money in the economy and create more jobs, and start initiating more economic projects. And, at the moment it is not happening from companies within South Africa, and it is definitely not happening in real terms, from many new companies from outside of South Africa. So, there are a lot of policy problems that are hampering growth; and not only the BEE, there are various other pieces of legislation that are keeping foreign investment from South Africa; for instance, the legislation regarding the insurance coverage of foreign companies in South Africa, and certainty that they will not be expropriated without compensation.
The legislation that I referred to that is keeping foreign investment from South Africa is the ironically titled Protection of Investment Act 22 of 2015. This Act replaced and is busy replacing many Bilateral Investment Treaties (BIT’s) with other countries, where last mentioned, provided more protection against expropriation, guaranteed values in case of expropriation and prohibited expropriation without compensation.
That legislation which was created, that replaced existing international treaties in that regard, gives those companies less protection than they were afforded by the Treaties which were in place. And, those companies have indicated that they will not be investing in this country anymore, as a result. In fact, the American Chamber of Commerce told us that there is R3 000,000,000,000 (three trillion Rand) worth of investment waiting to come into South Africa from the Unites States, only. But, they will not bring a cent to South Africa unless there is policy certainty that their businesses will be protected in South Africa. So, government has lifted protection against businesses, that they had against expropriation without compensation, they have kept implementing BEE in a more stringent manner which is not empowering people – it is now a scientific fact, that it is not empowering people, and it keeps businesses within South Africa, and from outside of South Africa, from investing in this country, and without those investments we cannot grow our economy. This means that if the economy does not grow, there will not be enough new jobs, and this is happening when the world is going into the Fourth Industrial Revolution where machines will be taking over more and more of our jobs. Even, computers will be taking over jobs of lawyers, and doctors, and journalists, in the future so, it is not only the labourers who now have to fear for their positions because of the machines taking over, but it is also regular office jobs, let me put it that way, that are under threat. That is going to change the world, never mind South Africa, and yet we are not taking that seriously.
I have said this, again and again to various Socialist-oriented Members of Parliament: “you are scared that white people might be taking jobs from black people, but you should not be worried about that, because that it not anything that you need to be concerned of; it fails in comparison to the jobs that will be destroyed when the robots take all of our jobs.” And, these people in government at the moment are oblivious to what is happening around the world, and how it will impact South Africa, as well. While they are playing ideological games, with policies that do not work and are proven not to work, we are very concerned about this because, it will increase the poverty in South Africa, it will increase threat of an environment of revolution because people are hungry, and they will do anything – that is understandable, but we can avoid that if we now change direction. And, that is why it is so important to either force the government to change policy direction, or kick the government out, and form a coalition government in 2019; hopefully we can do that.
Is there anything that you would like to add?
I think it is important that we have a look at what policies work around the world. It has now been between 200 and 300 years, since the Industrial Revolution started, and started changing the world, and colonisation happened, and many countries around the world were pulled into the Modern World, and whether we like it or not, we are part of a global economy. And, where we stand in history, we have the one advantage, to look back at history and to look at the whole world as a laboratory, of sorts. And say to ourselves, “in which part of the laboratory did the economies work, and why did they work? What were the policies?” And, see whether we can take those lessons learnt and adapt them for our own circumstances, and implement them here, so that we can start killing-off the poverty, which is our greatest enemy, as soon as possible. Unfortunately, if we increase poverty in South Africa; and we are on that road, unfortunately, at the moment – then only a few people are being enriched. We do not know if the fabric of society will hold, and that will be a terrible thing to happen. If society just implodes, and there is no law and order; we do not know what will happen then – nobody will be safe. So, it is not in our interest to wish upon anyone continued poverty. Even if you are the most selfish person in the world, and we are not, it would be in your interest to make sure that your neighbours are not hungry, and have jobs, and decent schools, and so on. That is what we must work for, and work towards; but, we can only do it by looking at what policies work around the world, and implementing that. And many examples are shining through – countries which were decimated in the Second World War, like Germany, like Malaysia, the Asian Tigers are very good examples, that just pulled themselves up by implementing the right policies. So, it can be done; those examples are there, we must just go and learn those lessons and implement them here.