Davies warns of stricter BEE codes

2012-07-10 11:41

Johannesburg - Trade and Industry Minister Rob Davies warned on Tuesday that black economic empowerment points would be deducted from businesses which did not invest in enterprise, supplier, and skills development.

Too few companies were giving sufficient support to these areas in terms of the BEE Act and Codes of Good Practice.

"Far too few companies are involved in this space," he said at a summit in Johannesburg for SMMEs from the public and private sector.

BEE legislation would be tweaked to ensure more attention was given to supporting small business.

"If you don't earn a percentage of the target (for these sectors), we will deduct points from the overall scorecard," he said.

Davies said government wanted to encourage a symbiotic relationship between big and small companies.

By developing black entrepreneurs, particularly black industrialists, corporates would contribute to South Africa's industrialisation and to a significant manufacturing sector.

"We want to see this space occupied increasingly by black manufacturers and black industrialists," he said.

Accordingly, government's infrastructure rollout, as well as the industrial development action plan, stipulated that a certain percentage of equipment was source from local suppliers.

This policy had already been implemented when sourcing buses, electricity transmission lines, and locomotives.

"This is the way we are intending to move forward," he said.

Government would also double the number of small business incubation programmes from 30 to 60 in the next three years, said Davies.

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  • jonathan.seagul.5 - 2012-07-10 12:11

    BEE and AA or whatever other combination of alphabetic letters you may think about is going to lead to the downfall of the SA economy. I will have nothing to do with it and employs only on merrit and are proud to say that I have a balanced and competant work force. As a matter of principal I will not deal with the government because they don't pay their accounts. My business is sucsesfull and those who don't want to deal with us for not having a BEE rating are welcome to go. I have seen the BEE companies come and go and we are still there because our business is based on good old fashioned, quality products and good professional service and that you can only supply with competant staff.

      Glyn - 2012-07-10 12:20

      @jonathan.seagul.5 - My comment below applies to the BEE and AA policies of the anc. I fully support your comment and believe that the only way forward to a peaceful and prosperous South Africa is by practicing Equal Opportunity policies. BEE and AA are deliberate handicaps to the economy, not a good idea! Vote DA!

      bob.mcmillen.564 - 2012-07-10 12:25

      It has to be extremely degrading to know your black owned company is only successful because of racist government laws, forcing other companies to deal with you just because of your skin colour, I wish more large companies would take your stance Jonathan and deal only with competent efficient companies regardless of colour.

      press.enter.12 - 2012-07-10 12:34

      That's it ANC punish those bastard revolutionary white entrepeneurs who want to dare to start businesses in South Africa - Viva no white entrepeneurs Viva . . . . !!!!!

      oomkrummel.krummel - 2012-07-10 13:35

      We need divine intervention...BEE can never work in this country..Amen..! - 2012-07-10 14:08

      Jonathan.Seagul... You Sir, are a real thinker! I share your views 100%

      claudia.meads - 2012-07-10 14:09

      Seems like Rob Davies has succumbed to the ANC's obligatory cognitive lobotomy. How can you conceivably expect all companies to be training/development institutions? It is not the mandate of just any/every company - eg the company's core competency is - logical is it not.., except if you are a member of the ANC it seems, then the rational faculties have to be removed first. In fact, forcing companies to engage in certain activities, at their expense could well be grossly in contradiction with SA's Constitution. The real issue is that the fascist ANC regime has wholly failed in this regard - mostly because their expectations are nothing more than a far-fetched fairy tale. As such, the ANC now wants to force the impossible upon others - it is SIMPLY UNCONSTITUTIONAL. The time has arrived for SA companies to simply ignore the BEE requirements en masse - it is clearly grossly unconstitutional.

      aaron.radebe.1 - 2012-07-10 14:31

      According to this article - - white control less than a third of the economy now. Remind me again, at what point does race based discrimination become unjustifiable? When is the UN mandated sunset clause on our affirmative action laws?

  • Glyn - 2012-07-10 12:14


      ian.furman - 2012-07-10 12:20

      It has nothing to do with being racist!we are a bee company and routinely get told that we can not use the credentials of black entrepeneurs because they have not paid to be registered!!it is hypocritical and just another government racketeering scam.

      Johan De Beer - 2012-07-10 15:15

      Ian, you are talking nonsense.

  • chris.shield - 2012-07-10 12:20

    Ban "supplier lists", It's nearly impossible for a start-up to supply big mines and corporates due to the reams of paperwork it takes to become an approved supplier. While you're at it put a maximum limit of 30 days from invoicing that can legally be used in their payment terms. Also ban overly complicated tender documents, there is no reason for a tender to run past 3 pages when supplying equipment. It takes days to fill in some of the tenders big companies put out whether you're building a factory or selling a packet of bolts, no entrepreneur has the spare time to even bother....

  • Thobile Lugwadu - 2012-07-10 12:23

    Talking is cheap minister , lets employ a system that says, once empowered, always empowered. This will ensure that a significant number of HDIs participates. I am very much interested in incubator programmes since they can bring about skills transfer as well

  • Hermann - 2012-07-10 12:23

    Rob Davies is calling blacks inferior and therefore want to advance them through legislation - forced advancement - instead of letting well deserved merit pave the way.

  • rob.gunning.1 - 2012-07-10 12:33

    What a fantastically racist concept. Keep up the great racist work. Your children will be so proud of your racist policies. Viva racism!

  • lerato.kay.3 - 2012-07-10 12:40

    Affirmative Action is applicable because the government is trying to redress past ills. For any person to criticise such an exercise is shocking, If you really want the gvt to eradicate such a policy then we must look at ways to equal distribution of wealth. If our economy was efficient we wouldn’t need such laws I agree. How about the government making sure that resource ownership is a true reflection of our demographics. In as much as the 80% of the means of production are in the hands of the minority we will still need AA. I just wish one day we will have an apologetic gvt that will aggressively see to equality in our society. It pains me to see some comments implying that AA would collapse the economy because blacks are useless.

      louis.jordaan.1804 - 2012-07-10 12:54

      Lerato, smoke this. I am white, always worked for white owned companies and then decided to start my own company in 1998 with an input capital of R350.00, yes R350.00. The first year, turned R750K, in 2006, turned almost R15mil. Took on BEE partners in 2007 and closed the company dorrs in 2008. Equality and oppertunity, kiss my a$$

      Robin - 2012-07-10 13:14

      @lerato : you don't have a clue what you are talking about ! May I suggest you touch up on your vastly lacking comprehension of economic matters by reading the works of Prof.Dr. Walter E Williams (and yes, he is a well respected negro economist). For instance : find out from him what the reasons are, that in the USA 27.4% of the white youth and 52.2% of the black youth were unemployed - despite affirmative measures by the USA government running in the trillions of Dollars. For starters you can look at youtube: "John Stossel - the State against blacks" - an interview with prof. Williams. ..and why is it that in the USA 90% of the economists agree that the implementation of minimum wages increases the rate of unemployment !

      rob.gunning.1 - 2012-07-10 13:36

      Lerato.. Please use your brain... No matter what happens, the means of production will always be owned by a minority of people. Too many cooks spoil the broth. You can't have an infinite number of people owning a finite amount of primary resources. Learn to compete and become creative enough to move into a new transition of business, don't legislate it to be more beneficial to one race over another. We don't live in the Congo, we live in South Africa. Behave as such.

      lerato.kay.3 - 2012-07-10 13:45

      Given the current status of the US economy with all due respect to your intellect I don’t think it’s a good idea to use a dysfunctional economy in making a so called factual and well researched argument. You could have used the BRICS or Asian Tigers, they could have been better examples. Anyway back to your argument, AA seeks to redress the past injustice; we are not saying all blacks must be upgraded irrespective of their qualification. AA seeks to promote qualified black individuals so as to compete with their white counterparts, I for example I completed my undergrad at UCT ages ago and in my class I had students from all race groups struggling. I excelled and was one of the best students in my class and to my shock and amazement we had some guys that struggled to graduate and when they did, first day at work they were paid far much than I was despite the fact I was with the firm 16months before these struggling students finally graduated. We might deny this but apartheid system really affected our market dynamics and in such situation that’s when you need the gvt to use its invisible hand to correct such inefficiencies. As for @louis.jordaan.1804 there is no way that I will kiss your @$$ too late for that you lost your chance in 1993, not in a million years and that’s a promise! Tables will turn and you might find yourself doing that, and history doesn’t disappoint it happened just to our neighbours and it’s coming to SA – time will tell.

      foxiloxi - 2012-07-10 15:21

      Lerato, BEE is benefiting a small select few at the expense of the masses, only those few black elite are getting rich while the rest of the nations suffers in poverty!! Secondly, the BEE laws and regulations in place currenlty prevent those white entrepreneurs that do open small business from growing and from employing more people due to those very laws, so in essence, you BEE and AA are actually stopping growth and creating more unemployment, lastly, why do you insist on re-distribution of wealth, why do Africans not create wealth from scratch, if whites can do it then blacks can as well, there is nothing stopping them from creating wealth and everything on their side to assist them in creating wealth such as the AA and BEE Laws? Answer this for me please in a sensible manner preferably?

      rob.bancroft.94 - 2012-07-10 15:37

      lerato, your understanding of how the US economy is run not only shows your ignorance of it, but also your understanding of the implications of BEE. It is not the economists who run the US economy, but the politicians at the end of the day.

      jan.calitz1 - 2012-07-10 15:50

      I will distribute my credit card and business loan debts to you, Kay. Will you please accept?

      freddy.vanwijk - 2012-07-10 17:37

      Affirmative action has caused billions in damages and successes are very few & far between. The morale of those affected are disappearing down a bottemless pit faster than a flushing toilet. I've read the comments thus far and I fully agree. What government is failing to do is how the minority can overcome this. People from all walks of life still fail to realise that if you want to achieve your objectives & goals, you must look at opportunities that present itself and be prepared to self-educate and compete instead of feeding off others.

      wo0two0t - 2012-07-12 11:01

      @lerato - Our government have created a stigma for black people. Allot of companies don’t want to but need to employ blacks because of BEE and AA. BEE and AA creates a lazy black working class - I see it every day and I’m sure some employers see it as well. I’m not saying all black people are lazy but BEE makes it so easy for you guys that you don’t really need to try all that hard and when blacks are employed they almost feel we owe them something for employing them otherwise they will go elsewhere. A skilled hard working black female is like gold in SA regarding BEE and AA – she can ask for way more than she’s worth. Is this fair for all races? Think about it. In business we don’t have time for this BS, just employ the best person for the job colour doesn’t mean $h!* otherwise you are setting yourself up to fail.

      filum.ho - 2012-08-22 00:07

      I am a minority and I am Asian. I understand the need for AA. What i can't understand is how anybody can honestly defend the track record of this government in empowering the population at large. Not a day goes by without some corruption scandal, failed service delivery and just shocking management of this country. Empowerment is not only about the equal distribution of wealth. It begins with putting down a solid foundation and this starts with education. Because of incompetent individual put into positions of responsibility we are left with a legacy of high crime, huge youth unemployment, terrible service delivery and the list goes on and on. The tragedy is that this country has almost unlimited potential. It is absolutely normal for politicians in power to look after their own. However, in most countries there is still accountability and that's the difference. I think most people on this forum would agree that if a BEE company could deliver a service at roughly the same degree of efficiency and competitiveness as any other company, it would be hard to argue against their appointment. We need to build solid foundations. More money needs to be directed to educating the youth. Entrepeneurs regardless of color need to be encouraged as small and middle sized businesses drive job creation. Policy needs to take a longer term outlook and most of all we need accountability.

  • carolyn.myburgh - 2012-07-10 12:43

    I am with Jonathon on this one we tried the skills developement it very nearly sent us upside down, we still have a BEE rating but will not go out of our way to do this again (these kids no nothing of what they say they learnt in college) We like the idea of doing business after 100% BEE companies have been there and completly fluffed the job taken the money and disappeared then we get the job and our reputation is no so huge we cannot keep up with some of the requests to fix other companies mess, so in that way BEE is good for us but not much else!!!

  • Henk - 2012-07-10 13:30

    Damn you are dumb. Just the other day Zuma said whites have all the money. Yet you want to exclude this money? WTF? If you provide the space for business without government interference this country will shine by itself. By the way most of the skilled whites have left this country already, so you do not need to worry about whites taking over the workspace any more....

  • stephen.crossley.56 - 2012-07-10 13:39

    All these problems are caused by poor education standards in this country. Poor education leads to more people, our economic growth cannot and will not be able to match the exponential growth of the population. Good education will incalcate social and environmental resposibilty. Our revered and poorly educated President has 21 children, if every male in the country say 25,000,000 had 21 children there would be there would be 525,000,000 people living in SA in one generation, thus 11.025 billion in two generations. TEACH the kids so they do not breed themselves into abject poverty.

  • Robin - 2012-07-10 13:52

    Minister Davies - the reputed black economist professor Dr. Walter E Williams of the USA has some macabre points of view on poverty, like this one : The welfare state is like a giant drug pusher - the government has lured its citizens into a system of dependancy, not encouraging them to try. They may never learn to pull themselves out of poverty - one step at a time !

  • willem.dehaan.94 - 2012-07-10 14:19

    It would appear that some people are hard of hearing and have limited eye-sight plus an inability to learn. Seems that it comes with the position of minister or it might even start with becoming a member of the ANC. Almost 20 years of cadre-deployment and Be and Bee and the whole alphabet and what has it taught us, who can see and hear? That it is a flop, inevitably leads to mismanagent, corruption, failure, waste of money, insolvency, enrichment of cronies, etc etc. But no, the honourable minister has not seen or heard or in any other way sensed these evils, or if he has, definitely not learned anything. He wants to increase ...?(!) Mr Minister, with the GREATEST RESPECT (I trust you know what that really indicates), when a lorry is running down the pass and going for the abyss you apply the brakes, you do NOT step on the gas!

  • jannie.kotze.7 - 2012-07-10 15:30

    Why is it that Coloureds and Indians were very successfull and excel in the Apartheid era, and are doing so much better now without exceptional favours from government?? The cANCer is degrading Africans by making laws to over protect and give hand-outs for free to them. There are many Africans that do well without government assistance! This is purely a racist cANCer that aims to destroy the country and its economy! Your corruption and thieving has done more damage in 18 years than what Apartheid did in 48 years! Cohesion is impossible with JZ, his cronies, and racist laws!

  • fanie.dutoit2 - 2012-07-10 15:34

    Results: Decreased productivity, less employment opportunities, less tax for the government, less services by the government = more poverty.

  • bongani.khumalo.967422 - 2012-07-10 15:47

    try make it easy to get a VAT number, easy to hire and fire, easy to open a bank account and get rid of all the retarded and arbitrary legislation that our government insist on passing for no new reason and then you will be able to create industrialists. A bot of safety and security would also help but I'm starting to think that the government benefits from crime and turkeys dont vote for xmas

  • Arthur Salvado - 2012-07-11 07:53

    Another nail in the coffin. Great pity, serious and true. Welcome to the new Zim. Ouch

  • NicBob - 2012-07-12 12:07

    Government knows exactly what it is doing. There is no attempt being made to actually "empower" anyone, it's a scam for votes. Everyone knows that it doesn't work. Look at the unemployment rate compared to when BEE and AA were first put in place, has anything improved? If government really wanted to help blacks in South Africa, they would make an attempt to improve education. The same approach to the economy has been used for education as well though and instead of trying to increase salaries for teachers, improving syllabii and focusing on the children's needs, they encourage the lowering of standards in schools in order to make it easier to pass. The best way of helping blacks on a large scale would be to improve the country as a whole, since blacks are the majority, they would benefit the most.

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