‘B-BBEE front’: Community schemes’ economic transformation sparks debate

Despite calls from Human Settlements Minister Mmamoloko Kubayi that community schemes need to be subject to mandatory “economic transformation”, the Democratic Alliance (DA) believes it will be used as a scheme for B-BBEE companies connected to cadres.

Speaking at the first Community Schemes Ombud Service indaba for stakeholders in Joburg recently, Kubayi noted the growth in community schemes and their importance in South Africa.

She said mandatory procurement transformation in community schemes – which include sectional title complexes, homeowners’ associations, retirement housing schemes, share block companies and housing cooperatives – were necessary.

Community Associations Institute of South Africa vice-chair, cofounder and course facilitator Johan Kruger said the main service providers in many estates were already B-BBEE-compliant.

“In many gated communities they are already B-BBEE-compliant,” he said.

Kruger added that people interpreted the minister’s call for “economic transformation” in gated communities as “a lot of people thinking they would have to sell their houses”.

“And then from now, the majority of people who would live there would be black people,” he added.

Kubayi said SA had an estimated 70 000 community schemes and had also seen a growth trend in gated communities.

She said 27% of the total value of residential property in SA was from organised communities, which meant community schemes were a significant economic sector.

“The services these schemes solicit – such as security and garden services – make the sector a huge contributor to job creation, mainly because many of the services are sourced from small and medium enterprises,” she noted.

“We, therefore, need to put measures in place to ensure that a procurement approach that gives opportunities to emerging SMMEs, especially those from previously disadvantaged communities, becomes mandatory.”

But DA shadow minister of human settlements Luyolo Mphithi said B-BBEE corruption was forcing private entities to hand over shares and tenders to companies connected to the ANC elite, which has contributed to widespread economic and service delivery collapse in the country.

Mphithi said alongside cadre deployment, B-BBEE corruption was the ANC’s preferred vehicle to capture institutions and “it has now set its sights on capturing gated communities”.

“The DA is set to expand our battle against ANC corruption following the announcement last week that the government has identified gated communities as its next target for looting and political capture,” he noted.

“This will throw the gates of organised estates wide open to ANC looting. “Kubayi issued a blanket condemnation of community schemes by claiming ‘cultural diversity’ has unfortunately become a major source of disputes within the [community] schemes.”

He said it raised the spectre of the ANC regulating procurement and ownership in these communities based on race.

Political analyst Arthur Shopola agreed with Mphithi. He said while this had the potential to become a great initiative, all the legislative frameworks established post-apartheid were intended to cater to the previously marginalised business people and small/ medium enterprises.

“There seems to be no political will in implementing the transformative policies introduced in the post-apartheid state,” he said.

He noted that even with the multitrillion-rand community scheme, there weren’t enough concerted efforts from the political leadership of the government in particular, human settlements, to appreciate that black people had been sidelined for too long and that there now needed to be some serious tangible changes.

“Although it’s a good initiative, it’s concerning to have these kinds of programmes now,” he said. “SA is turning 30 and you’re still talking about previously disadvantaged groups, disorganised land planning policies… it’s really concerning.”

He said “only a select few, in the sense that the people who are benefitting from the current design are mainly those with political connections, not ordinary South Africans”.