Phosa: BEE not working

2012-10-25 22:30

Johannesburg - Black economic empowerment (BEE) is not helping to reduce poverty and inequality, ANC treasurer general Mathews Phosa said on Thursday.

"Marikana taught us that... our [BEE] model is dysfunctional, and that we need to be creative when old order models of negotiation are discarded by the disenfranchised," Phosa said in a speech prepared for delivery in Johannesburg.

"If the miners at Marikana, and elsewhere, had a meaningful stake in the assets that they create, my view is that we would have had different and more positive outcomes."

He was referring to the shooting dead of 34 striking Lonmin platinum mine workers by the police in Marikana on August 16.

BEE had not made any meaningful contribution towards alleviating poverty and unemployment.

"What it did do is create an upper class of wealthy black investors who initially funded their wealth with debt through the acquisition of shareholding in successful white or international businesses."

Successful economic transformation needed black entrepreneurs who were not the beneficiaries of wealth created by others.

"The simple fact is, whether we are white or black, there is a dire need for broader participation in the wealth of this country in a way different from the current model," he said.

Wealth was never given away or successfully redistributed through force. The country's circumstances however showed that the wealth and ownership gap needed to be closed.

"If we hesitate in doing so, we will be the architects of our own demise."

He said South Africa's current policy drift and the public's opinion on these matters were not helping.

The time that elapsed between the crisis, the policy solution and its implementation did not contribute to social stability.

  • richard.jeremy.79 - 2012-10-25 21:32

    Then get rid of it then straight away please!!!

      richard.jeremy.79 - 2012-10-25 22:26

      Why can't these people in power just let common sense for once prevail.Why invest or put all your energies into something like BEE,AA and all the rest of it when you know it ain't working.ANC please stop being so damn daft and thickheaded and just move along with the times like the rest of the world.Control freaks that patronize their society with their dense and imbecilic social programs are just bonehead morons. The "collective punishment" being dished through BEE and all the rest of it only perpetuates the ANC's power and don't allow for more credible programs to be given a chance.The gap the runs between the ANC's perceptions of what is in South Africa's and South Africans best interest and the sad realities of everyday life in South Africa has become dangerously wide. Here's why: 1.40% of our population or roughly 20 million South Africans still live below the national poverty line. 2.The infant mortality rate is 6 times higher than in the OECD countries even with a healthcare system that was "modernize" in early 2000. 3.South Africa's life expectancy at birth has dropped to 49.3 years in 2012 when in 1996 it was 61.3 years for a South African. It's more about self preservation of its own skin colour,race or kind with the ANC then taking on what's in the best interest of South Africans as a whole.

      alwyn.vantonder - 2012-10-26 01:42

      The reason why they force BEE/ AA on the country, is so they can steal as much as they can, from South Africa! What a bunch of losers! And NOW, Phose suddenly switches on the light.. People from all over the world has been saying this all along, yet here we are, mr. Phosa woke up from his sleep and gave us his two cents worth. This is like watching a bad movie on repeat..

  • Gatvol Griet - 2012-10-25 21:32

    Whoa! Really? Could've told you so. Yes force will never work.

      omge.klits - 2012-10-25 22:12

      A c-o-n-u-n-d-r-u-m : Enriching a few chronies that ads little new capacity to the economy on the one hand - and on the other hand you have trade unions destroying jobs - go figure - 5 years max . . perhaps ?

  • jaded.oldfart - 2012-10-25 21:35

    that's probably because all the cream is being siphoned off by the fat cats, instead of being directed towards improving the lot of the poor...

      art5SA - 2012-10-25 23:13

      WHen Mbheki was President from 1999 till 2008... only 120 RHINO's were poached, during that period... Since 2009 more than 1396 RHINO'S have been MURDERED, under the presidency of Jacob "Double Bump" Zuma... IRONIC.... OR WHAT?

  • lvhukeya1 - 2012-10-25 21:35


      tasneem.sattar.5 - 2012-10-25 22:14

      Zuma? Patrice? Tokyo? Yengeni? Malema? PHOSA!!!

      themba.maseko.568 - 2012-10-26 09:15

      Come on people, Employment Equity is part of BEE. There are seven elements which will soon be reduced to 5. Get your facts right!

  • lvhukeya1 - 2012-10-25 21:38


      dee.bone.39 - 2012-10-25 22:25

      and matthews phosa

  • richard.jeremy.79 - 2012-10-25 21:38

    Then get rid of it then straight away!!!!!!!

  • annelise.vanderschyff - 2012-10-25 21:39

    It is not news it is facts!!!!!bee only works for anc fat cats!!!

      themba.maseko.568 - 2012-10-26 09:04

      Employment Equity is part of BEE. Do not look at it at the ownership level only. The many people that are in professional employment are largely there because of BEE policies

      themba.maseko.568 - 2012-10-26 09:12

      BEE includes Employment Equity.Do not look at it in terms of ownership only. Come on guys are you not sorry for oppressing us for so long???

  • nyiko.ngobeni.5011 - 2012-10-25 21:40

    Just a speech. How much fo the workers in the businesses he runs or has stake in own? He personally had coined it on the sand model he blames. I heard he owns the territorial franchise rights to shell on gauteng? Meaning all franchises come under him?

      johann.enslin.9 - 2012-10-25 21:44

      Hahahaha, yes, some are more equal than others.

      Billy - 2012-10-25 22:01

      whaaat, thats serious money, wonder were his input is in the fuel price fixing. its starting to make more sense now...

      art5SA - 2012-10-25 23:07

      And he OWNS every single Mac Donalds.... hense the reason Cyril is looking alot like "THE BEAST", Prop from the Natal Sharks!

      Michael - 2012-10-26 09:47

      they're all fat cants...

  • kolobe.mzansi.7 - 2012-10-25 21:44

    those with economic power will not let it work

      crracker.crackerr - 2012-10-25 22:09

      No. Rely on yourself. Don't always lean on others.

      grootrot.vanzyl - 2012-10-25 22:11

      Why do you not want to let it work, Kolobe? You have a computer and airtime - that gives you info and cash = economic power!

      pula.betsho - 2012-10-25 22:58

      Very intelligent observation,the people in power are very manupulative of the systems in place to render BEE dysfunctional.people in power went to the extent of practicing fronting,employing white females to play numbers for ee complience,arrogantly paying hefty bee non complience penalties.whoever comes president at mangaung should implement the 2nd transition or economic freedom/ee with an iron fist

      clive.schonken - 2012-10-26 08:48

      Kolobe, imagine in what big trouble Matthew Phosa is for openly declaring that BEE is not working without first discussing the issue with his mate 'Robin Hood' Davies and now you come out with your remark. Remember remarks like yours is only applicable on April 1.

  • gaby.hide.3 - 2012-10-25 21:47

    This is the first intelligent thing I've heard coming from the anc in a long time.

  • moriri.mosweu - 2012-10-25 21:48

    Let all those who benefited from BEE,distribute their wealth to other poor black people. I think that will be a true Black Economic Empowerment.

  • badladballie - 2012-10-25 21:52

    Halleluiah! This is so great! Ok guys, listen to Mr. Treasurer General now: stop demanding free stuff and start your own business rather. Yes I am afraid that does mean hard work but believe it or not that is how people get money.

      dee.bone.39 - 2012-10-25 22:16

      half brained comment. White big business in cohoots with ANC elite is equally to be blamed for the ANC elite pigging out on the countries wealth. The ANC elite has joined and encouraged big business to rape us. Banks, mobile cellphone eskom DSTV, Media 24, mines etc are pigging out like gluttons due to ANC misrule. Ww are all being well and truly screw#

      johann.enslin.9 - 2012-10-25 22:53

      White big mean those with stock freely traded on the JSE? Didn't know shares where reserved for whites only. Suggest you contact Trevor ASAP!

      badladballie - 2012-10-25 23:11

      dee.bonehead.39 you are stating the obvious about the govt and big business but there is nothing half brained about encouraging entrepreneurs to create jobs.

      robert.m.sylvester - 2012-10-26 09:03

      @the39boneheads - Businesses will adapt or die. You have no idea of what you are talking about.

  • crracker.crackerr - 2012-10-25 21:56

    Mobilze your capital and actually take over the economy. But no, the trade unions and other hangers on don't want you to be contaminated by capitalism. Keep everybody subservient. Subsrciption payments and reliant on the silly political slogans and pure lies. This country has the financial vehicles to allow the empowerment of all South Africans.

  • sminx.r.mandla - 2012-10-25 22:00

    Finally some sense, now I rate what would make more sense is to scrap it off completely because hardly any community or intended beneficiary has received anything but instead ex-cons like Gayton and bigots in the ANC receive what doesn't belong to them!!

  • bongane.zwane.948 - 2012-10-25 22:03

    I'm ashamed as a black person that such was put in practice by greedy old man with no business knowledge what so ever sies bunch of ........ that money is the tax payers money meaning both black

      bongane.zwane.948 - 2012-10-26 02:17

      Cut my comment i don't care! but the companys that benefitted also in the BEE deals are to blame for taking the country and the unemployed for a ride.

  • Peché - 2012-10-25 22:08

    LOL, yes we know...

  • nyiko.ngobeni.5011 - 2012-10-25 22:11

    He's guilty like all of them on grounds of common purpose. He can talk like this but what has he ever done about it? Wasn't he premier of mpumalanga not long ago? Hasn't he benefited? He did and still does

  • rob.gunning.1 - 2012-10-25 22:12

    I agree 100% with Mr. Phosa

  • vongani.nkanyani.7 - 2012-10-25 22:12

    BEE is a way of creating Business men with no business minds. Try and empower entrepreneurs.

      johann.enslin.9 - 2012-10-25 22:43

      Right on.

      daniel.machet - 2012-10-26 00:04

      I remember that when the ANC came to power, the political catch words were entrepreneurship and SMME's... but without investing in education , promoting a culture of saving, building on the infrastructure already there... it was just lip service

  • fort.horseman.7 - 2012-10-25 22:28

    When u have a vanity infested mentality assuming a whimsical notion of divine superiority over people of other creeds and cultures,financial resolves will not be enough to address the more serious mental diseases and injustices in S.Aan society. There needs to be stringent laws against inequality and ethnic discrimination in SA,also.

  • dee.bone.39 - 2012-10-25 22:29

    WTF. he's talking about himself. Its like Zuma talking out against corruption. These guys dont care a hoot about what tney say

  • qhama.bona - 2012-10-25 22:41

    I agree with Phosa. If you look at the reasons why BEE was created you will notice it was to create pool of black entrepreneurs who would contribute to the creation of meaningful jobs for the previously disadvantaged racial groups. However what BEE has created is a minority of politically connected oligarchs who have done nothing meaningful in the business sector. Like Phosa says this black elite has been given shares by businesses because those companies want political protection from those politically connected individuals. Instead what BEE should look to do is to empower those small businesses from the informal sector because that's how unemployment can be reduced. Another impediment to BEE is the rigidity of labour laws in this country. Because the ANC are in an alliance with Cosatu they often give in to their outrageous demands. That makes it extremely difficult for businesses to employ people because the cost of keeping those workers is far too expensive. Instead businesses are looking at ways to cut costs by using more machinery. If we are serious about creating more jobs government have to loosen those labour laws ever so slightly because businesses must also get incentives.Instead of expanding the social grants (which are also important) more money must be invested in skills development. Like Phosa says the another Marikana massacre must be avoided at all costs . If we do the basics then we'll be fine. However we need leadership with a backbone.

  • zwelakhe.sithole.1 - 2012-10-25 22:57

    Where was Mathews Phosa all along? Now that the ANC is now in the middle of this, he comes with this observation to divert isssues from the ANC, who are in government that has committed masssacres, first with HIV/AIDS denialism and now Marikana shootings.

  • themba.maseko.568 - 2012-10-25 23:02

    BEE was only supposed to deracialised poverty or wealth, which it has done very well. Virually all black middle class who are doing well, did so after the end of apartheid.

  • phumeza.mabukane - 2012-10-25 23:05

    I like the part were he says that workers must also be given stakes in mines and this must apply in all primary industries

      badladballie - 2012-10-25 23:44

      Unbelievable. He did not say workers must be "given" stakes. Workers have the right to buy shares in the company they work for and this would be very good for the company and the workers. Workers do not have the right to just get the companies shares for free just because they work there. Worthless shares are very bad for the company and for the workers. If the workers start their own company then they have the right to have all their own companies shares for free. I sincerely hope this makes sense to you.

      donny.doncaster - 2012-10-26 00:19

      Rather work on the gearing in your head.

      sally.lewitt - 2012-10-26 02:20

      We 'hear' what we want to 'hear' Pity!

  • Gert van Coller - 2012-10-25 23:13

    stating the obvious. yawn..

  • stephen.moloi.56 - 2012-10-25 23:19

    why kept quite for so long?ke lapiswa ke mampetje eish!

  • charles.maputla - 2012-10-25 23:22

    BEE only worked 4 a few politically connected plus the chinese. Remember they were declared black and they are now benefiting in BEE deals. Chinese are blacker that most so called black people. Ggaaaa!

      robert.m.sylvester - 2012-10-26 09:07

      Good point

  • trevor.mashilo - 2012-10-25 23:26

    At least he said some valuable thoughts,Lets wait nd c if his Buddies will agree to his Mindful Opinions.

  • elsbeth.verhoeven - 2012-10-25 23:31

    I know that the South African Government can learn from the Turkish Government. It has all to do with leadership. That country got a new leader 11 years ago. And since he is there everything is booming. The economy has grown enormously and the people are very hard working.

  • daniel.machet - 2012-10-26 00:00

    These comments are well thought and well worded... I hope the follow through has equal intent, is constructive and takes us forward (that said, no country can fund Zuma's or Malema's insatiable appetite)

  • oneandonlypeanut - 2012-10-26 00:12

    Funny enough, I told my dad today that we as South Africans can fix 60% of the country's problems by scrapping BEE, and here I am reading this article. You cannot create jobs by forcing whites out and placing some brother's buddy in that position that cannot do the job. The few blacks that CAN do the job cannot apply for that position because it's already filled by some brother's buddy. Do you understand what I'm saying, BEE undermines both white and black alike, except those who wangled themselves in.

  • daniel.machet - 2012-10-26 00:18

    hmmm... I wonder if they could somehow link pension schemes to the companies' which contribute i.e. have a mining/metal industry pension scheme which invests primarily in the mines, that would equate to a big chunk of ownership (normally I would say that diversifying would be a safer option but given how poorly our national pension schemes perform(probably because they invest in poorly performing quasi-state entities), the motivation this could have and the fact that workers would become two key stakeholders in the mines (and as influential shareholders have a say in how the profits are spread, who is hired to run the company and how much they are prepared to pay for those services oh, perhaps they could forward their union fees for this too).Hell who would need to nationalise, they would just need to push for a sizable enough shareholding in key public companies... of course how would they trust the people who are put on the board to act in their best interests?

  • yolanda.haripersad.1 - 2012-10-26 00:22

    What a revelation??? And how do you plan on fixing it?

  • herman.burger.5 - 2012-10-26 00:40

    So BEE is not working. fact is that NOTHING the ANC did since coming into power worked: Not education, not health services, not crime prevention, not basic service delivery, not housing, not job creation. The only things that really flourished are violent crime and corruption. The reason for the failure is obvious. Running a modern country successfully is a non trivial matter which requires skills taught at business schools and universities rather than revolutionary rhetoric and the deployment of cadres.

  • daniel.motlhatlhedi - 2012-10-26 00:41

    Are u saying this because you are going to Mangaung or u know for a fact it doesnt work since its benefiting your fellow ANC members.

  • jacques.botha.792 - 2012-10-26 00:44

    The goverment must make that lowest worker pay minimum wage of R1300.00 per week or R5000.00 per month after deductions and not R1300.00 per month, in today's economy life to survive in SA you must earn at least R10 000.00 per month but you can start with the ABOVE and no unions or strike will ever happen until the goverment give in, BEE have never helped the poor blacks only the goverment can help them, cause they have the power to give them the light for a bright SA to help them with food and water and a better life, if they are, then all of us will be helped

  • manie.feyer - 2012-10-26 00:53

    Simple, replace 90% of white jobs and business ownership through affirmitive Action,BEE and BB-BEE to obtain equality for our Rainbow nation. Oh my, that is only 875,000 jobs that the 57,000,000 will be able to get out of their Master Takeover Plan/s. For the dream that all MUST be equal, have a nicely furnished house in a good Suburb or your own Farm, a new car and motorboat and can afford a one month holiday every year in a 5 Star Hotel, a mere 8 Million Black jobs and Businesses must be created, take note, at an income that wil deliver this so called Whiteman's lifstyle. The masses can pull an upright but lazy tantrum, known as TOI-TOI, as much as they like, as it will remain a pipedream that 8 million Black jobs or business will fall out of the sky or will be created to afford the said percepted Whiteman's lifestyle. How did most all Whites achieve to life so well then? Easy bra, they worked hard and know what they do and do it right fast. Now at 63, throughout my life as a Whiteman, through hard work and generating income, Government took a share of my income as Tax, Water and Lights Rates, Property Tax and what not. I never received a single penny or a cent from Government. Blacks were brought under the impression that whites got it all from Government. Wrong, we worked for every cent. To this day Whites were forced to and can think out of the box to generate income and create sustainable businesses. Most Blacks depend on the State to survive and get all for free.

  • manie.feyer - 2012-10-26 01:01

    Time to wake up. Just a few ANC Cadres steal it all, which are going to leave you much worse off than before 1994 when you could still afford to buy a piece of meat, already today you can only afford to buy meat barren bones to cooc up something to eat.

  • cliff.slabbert - 2012-10-26 01:18

    What a genius!!!!!!

  • manie.feyer - 2012-10-26 01:19

    What makes mr. Phosa reason that giving miners an income of R18,000p/m as having a meaningful stake in the assets they create,will not resonate throughout the whole RSA economy where all would demand R18,000p/m wages. Meaning everybody will stay exactly where they were as cost of living will also increase simalirly and even more that the apparent wage increases so hard fought for. Seriously foolish leaders.

      goeie.jaarling - 2012-10-26 07:23

      You BraTambo, is a wise man!

  • mokoka3 - 2012-10-26 01:59

    Don't start with BEE, you yourself Phosa, you benefited from it, you're rich and now it must stop. That's nonsense.

  • fort.horseman.7 - 2012-10-26 02:02

    Mr Phosa,i believe that u r a sincere politician.but as much as we try,we require Divine Intervention to be blessed in our endeavours.God says 'I will not change the condition of a nation,until they change the condition of themselves'.Iv been around the world and people even praise the roads in SA.We are short of nothing,but the ANC must take drastic steps to root out corruption,incompetence,racial injustice and sinister activities within the state,moral upliftment of the black pshycy,to uplift them out of the decades of human and moral degradation and dehumanisation which prevails unfortunately even by the recent establishment of the new Black elite. These steps wil also instil the confidence to break thru the shackles of poverty sumd up with bee.

      fort.horseman.7 - 2012-10-26 02:21

      And more seriously if the ANC dont remove the 2 morons Angie M and enver surtee,at head of education u gona have a serious illeterate youth problem with only a 'blackberry' education that will be incapable of even handling a bank a/c let alone becoming entrepeneurs!

      louis.hager.12 - 2012-10-26 05:47

      There's no such thing as a sincere politician.

      fort.horseman.7 - 2012-10-26 07:26

      Ok guys,i agree,BEE is a failed recipe,and just creates endless opportunities for corruption, tender fraud,and opportunities for a selected few,and has shown no merit to adress empowering of the masses,So big co orperations who are reaping SAs mineral resources,maybe you can contribute and start playing a bigger role to payback to the rightful owners of that mineral wealth.But gov. need to educate the youth 1st.,with credible people heading it.

  • bongane.zwane.948 - 2012-10-26 02:09

    It was meant to inrich members of the ANC say it! and poverty was just a keyword in putting your hands in Taxpayers money.

  • bongane.zwane.948 - 2012-10-26 02:23

    And the companys that benefitted from such are to blame. still unemployment is high

  • Sammy Willow - 2012-10-26 02:29

    took 19 years to figure that out

  • mammudi.makgaleng.3 - 2012-10-26 02:32

    What are you waiting for? Take it out of the system

  • zolisa.dlokovu - 2012-10-26 04:36

    I agree. 100 %

  • andy.mku.9 - 2012-10-26 05:07

    Mr Phosa i think we need ministry of wealth distribution and land expropriation

      Karel du Toit - 2012-10-26 05:14

      and then become zim with no food

      Karel du Toit - 2012-10-26 05:16

      you need to create your own wealth you cant demand it

      cya.khubone - 2012-10-26 05:35

      I don't want my country to be like zimbabwe

      Karel du Toit - 2012-10-26 05:56

      Then learn from zimbabwe and do not remove or redistribute farms that provide food. But please take all the tabaco farms we dont need them.

  • masta.pilusa - 2012-10-26 05:12

    I think BEE has nothing to do with poverty bcause it was not based on poverty.It was a way of making a gap between poor and rich among blacks.