Mining Charter to benefit ANC-cronies - DA

Cape Town – The third version of the Mining Charter released on Thursday has opened the doors to even more enrichment of ANC-cronies, the Democratic Alliance (DA) said in a statement.

GAZETTED: Read the full Mining Charter 

Mineral Resources Minister Mosebenzi Zwane at a media conference in Pretoria conveyed the latest – and final – Mining Charter which has come into effect on Thursday June 15.

In the revised charter, the black ownership element is elevated from the current 26% to 30% and mining companies have 12 months in which they need to comply with the new target.

READ: Chamber to challenge new Mining Charter in court 

In addition, the minister has set a new target for prospecting licences of a minimum of 50% plus one black person shareholding, which must include voting rights.

New employment equity targets

The employment equity targets in the sector has also been adjusted upwards. At board level there needs to be 50% black representation of which 25% needs to be women, at senior management level 60% of representation must be black of which 30% needs to be women, black representation at middle management level will henceforth be at 75% of which 28% needs to be women and at junior management level 88% needs to black of which 44% needs to be women.

READ: Zwane reveals final Mining Charter, despite mining boycott 

James Lorimer, DA spokesperson on mining said in the statement that the release of the latest Mining Charter is proof that the ANC government does not care about long-term and sustainable transformation in the mining sector.

"Version 3 of the Mining Charter will be a disaster for the mining industry," Lorimer said, adding that the new rules amount to a "massive giveaway" of mine value to the ANC’s favoured groups.

'Bring mineworkers into mining schemes' 

Lorimer said his party supports share schemes for miners when they are structured to benefit the workers and are economically viable. "One way of diversifying the mining sector would be to bring mine workers into mining schemes. It’s pointless to try and diversify if it leads to the collapse of companies.

"But this is not what the ANC government is proposing. Instead, the ANC government’s Mining Charter proposal wants to make cronies and insiders richer, as they open up new opportunities to get in on mining deals."

READ: Guptas just another Anglo, Glencore CEO to Zwane 

Lorimer said there is enough evidence of how "connected cronies", such as the Gupta family has preyed on such deals.

In the new Mining Charter, Zwane also announced that 8% of mining companies' shareholding needs to go towards workers, while another 8% of shareholding is allocated to mine communities that will be be held through a trust.

"The reality is that only 8% of ownership will ever make it into the hands of mineworkers under Zwane’s proposal," Lorimer said.

The DA is also of the view that the requirement that all prospecting rights must be 50% +1 BEE inclusive, will mean the "virtual death" of prospecting.

"The BEE sector is perennially short of cash, particularly for speculative actions like prospecting. The amount of prospecting will plummet. Even if there are new finds, capital will be extremely difficult to raise," Lorimer said. 

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