Let’s not pretend that any attempt to buy out of BEE is going to contribute to transformation in South Africa
You have to hand it to the government. Their money-making long-term planning is incredible. Set up a well-meaning scheme 20 years ago for transformation, make it as ambiguous as possible, flood it with cadres and reap the rewards until enough people finally realise that they’re still shacking up despite this policy.
Even then, they could keep it going, pushing it more and calling the naysayers racist until they ran out of non-racist money and needed to turn to the racists. Now there’s talk of the racists being able to not be racist anymore as long as they give 3%.
Companies to buy BEE status?
The government is considering allowing companies to improve their BEE status by paying 3% of their revenue to the Transformation Fund.
I give it nine hours before somebody coins the term “white tax” and pits it against “white monopoly capital” in the South African rhetoric.
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It feels so defeating to even have to think of that future because by now, surely, after all that’s come out, we can admit that the issue of not having money is way less important than how we spend the money we already have.
Just this week, we’ve had a delightful array of news from the Tembisa Hospital probe to the KZN transport authority to the SABC. Fikilie Mbalula had to channel his best Mac Maharaj, somehow admitting to the exceptional extent of corruption in his party while trying to convince us that it’s a manageable problem, and has been well managed for the last two decades. With the DA’s precious jewel of the mountain city getting into the mix, it seems there’s no limit to how badly we spend our money.
Government’s spending crisis
About one in every seven rand the government spends goes to education, and while that sounds magnificent, uhmmm… what’s happening with schools? Oh sure, I can’t complain. The pass rate may rival Japanese criminal conviction rates, but what does it do for the kids who pass? Largely nothing if the unemployment statistics have much to say.
We’re so bad at spending money that they can’t even hide it anymore. A look at the May 2025 budget presents the biggest line item of spending is servicing debt. We’re to spend R100 billion more on that than social protection. All that borrowing, cost of borrowing and social protection, yet we find ourselves unable to crack the top 100 countries by education and can’t keep over half the population out of broad poverty.
So let’s not pretend that any attempt to buy out of BEE is going to be as catalysing to upliftment as it should. Some money will inevitably trickle down. Will it be worth setting up this whole system? Sure, to the guys that benefit, absolutely. Worth it for the country, though, I have my doubts.
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We all get it; South Africa has an earning problem. We don’t generate the funds we’d like to have. Guess what? There isn’t a country in the world that has enough to do the things it wants to do. We’re no different. Where we do seemingly take pride in differentiating ourselves is how calamitously we deploy our money while banking the “it’s just because we don’t have enough” Saambou cheque.
I’m sure many companies would love to increase their BEE scorecard, and if paying some money could do that, I don’t think they’d bat an eye. One would have to keep their eyes closed to avoid realising that a good BEE score doesn’t excuse one from their other employment equity obligations, but let’s be like the government on budgeting and gloss over that.
If it’s a revenue stream, fine. Just don’t take us for fools and try to claim it’s to aim for transformation because there’s been all the opportunity for that already, and instead, somebody got a nice house in Cape Town.
