Archive for category politics
Dear Minister
Posted by Keith in BBBEE Knowledge, Charters, Fronting, Sarcasm, True Empowerment, Verification, politics on March 9th, 2011
Dear Minister,
Please advise urgently.
My client is a QSE BEP. If he follows the BEP scorecard his ED target is R22 500 because ED is based on leviable amount. His SED target is R11250.
If he follows the codes of good practice his ED target is R2800 because we will use indicative profit and R1400 for SED.
If he follows the BEP scorecard he will need to pay R33 750 for both ED and SED, but if he follows the codes his cost is R4200 – a differential of R29 550.
Since the dti and SANAS are still seeking clarity, apparently now from the DG, and you have not any statement either, I need to know if the dti will condone my client following the codes that most suit him. The precedents have of course been set and we all know that SANAS will not regard this as a non-conformance and dti will not withdraw the certificate…….
On the other hand I’ve got some clients who are NOT in the construction sector but tend to like the lower adjustment for gender so are going to follow the construction/BEP codes. Is this also okay?
I know of a company that signed the final gazetted forestry charter but wants to follow AgriBEE and will use generic until that happens. Is this ok?
Now that I think of it, another client who has a turnover of over R1billion would like to follow the QSE scorecard for tourism. Also, a difficult client (you know how clients are) likes the Construction generic ownership element, the freight transport management control (for QSEs), the codes for EE, the QSE codes for Skills, and forestry for the other elements. Can I please have special permission to change the codes to suit my difficult client? He also wants to use a verification agency that had a pre-assessment letter in Feb 2010 but has now expired.
Another client would like to use ArcelorMittal as their verification agency. According to SANAS, ArcelorMittal has been accredited (for legal metrology, specifically weighing instruments), and the client feels that since ArcelorMittal, like SANAS, has no BEE certificate, they are a good organisation to do their BEE verification. Is this possible?
Minister, in any event we know that the dti/BEE Council will never be able to identify and really does not care about fronting, but being law abiding I’d like your approval to recommend fronting to my clients, who are being hamstrung by my honesty.
Yours sincerely
Keith
Jimmy Manyi
Posted by Keith in BBBEE Knowledge, politics on March 3rd, 2011
Everyone has an opinion on the Jimmy Manyi interview issued by Solidarity. Strange then that as at this morning (3 March 2011) only 6474 people have actually viewed it. I have to suspect most critics of Jimmy have not seen it, and none have seen the entire interview nor the context in which he made these comments. The part that has been uploaded is only 47 seconds, and very selectively chosen.
The context is he was talking about was the employment equity act, and he is very well briefed on the B-BBEE codes.
He knows that companies earn BEE points by employing black people in various management, and sometimes non-management positions. Many companies will specifically try to find a certain profile person in order to improve their BEE scorecard. We ourselves always tell our clients that they will earn more points, if they were to employ a higher percentage of black people in certain management categories.
At the same time we tell our clients that for example a black female in a particular category will earn them more points, and therefore they should try to find the best person for the job, but be aware that they will earn or lose points based on their decision.
From the black person’s viewpoint, we can easily direct a particular person to where there are opportunities. We know that for example most construction companies would be keen to interview a black female civil engineer. We would not hesitate to advise a person on how best to market themselves to get a good job. At this very moment I have 1300 CVs in front of me from people who are desperate for a job as a junior admin clerk – a very sad state of affairs. I’d like to employ every single person, but obviously cannot.
Let’s look at Jimmy’s comment. The number of coloured people in the Western Cape is generally higher than the rest of the country, just as we would expect more Indians in KZN than the rest of the country. I would have no hesitation in advising a coloured person who is unsuccessfully looking for a job in Western Cape to look further – specifically target regions and companies than have poor employment equity scores.
Is this what Jimmy meant? Is this what Jimmy said? Please watch the video and decide if it leaves out the context.
Also decide if the context is as I have described.
Congratulations – Broad-based is the winner
Posted by Keith in BBBEE Knowledge, DA, General, True Empowerment, politics on September 21st, 2010
The leader of the DA, Mrs Helen Zille has written at length about the need for empowerment to be broad-based. The DA has had a broad-based policy for a long time, but for unknown reason has never publicised it widely. Nevertheless we congratulate Premier Zille’s call for broad-based empowerment. However the DA’s policy falls way short of the dti’s codes of good practice. It offers no objective measurement, like the scorecard does, and it gives no targets or indicators to guide compliancy. It falls back onto a subjective approach to broad-based black economic empowerment.
Congratulations today must also go to the department of trade and industry – and the specific people how guided the original act through parliament, and then spent many years developing the codes. In researching this article we looked back at the draft codes of 2005 and 2006 and compared them to 2007. It is very instructive to see how they progressed and improved to the final stage.
Congratulations must also go to the tens of thousands of companies that are making an effort to comply and have produced their own scorecard or verified certificate. While there is a long way to go, some progress is being made towards true, and broad-based empowerment. Many companies are spending a lot of money on skills development. Many are working very hard on enterprise development. Corporate social responsibility is still being implemented and helping the poor and poverty stricken.
Yes, there is a long way to go, but our first fight was to get everyone to start thinking broad-based. The ArcelorMittal deal, on which we were the first to comment has turned out to be the catalyst, or the final straw to narrow-based to making the whole of South Africa realize that broad-based was the way to go, and that broad-based was always the policy of the dti. We are now seeing the politicians calling for broad-based. The SACP has also condemned narrow-based, in favour of broad-based.
Most companies – our clients are very happy to follow broad-based once they know what it entails.
It’s taken some time, but we are getting very excited that broad-based is the winner.
New mining charter
Posted by Keith in BBBEE Knowledge, True Empowerment, politics on September 13th, 2010
See http://www.buanews.gov.za/news/10/10091315051002
“The minister said the reviewed Mining Charter represented collaborative work among stakeholders under the auspices of Mining Industry Growth, Development and Employment Task Team (MIGDETT).”
I wonder why the dti was not represented?
Fronting and Enrichment – the solution
Posted by Keith in BBBEE Knowledge, politics, procurement on August 20th, 2010
Government tenders awarded to tenderpreneurs, and enrichment via dodgy ownership deals causes a lot of anguish for many South Africans. Currently government tenders are awarded on the basis of many factors: price, performance and “empowerment credentials”. This loosely translates to asking a company for its black ownership and details of its directors.
Section 10 of the B-BBEE act makes it compulsory for organs of state and public entities to take into account the B-BBEE status of the supplier in setting up preferential procurement policies. Virtually no public entity is doing this. Those that do not are in breach of the constitution. A tender, license or disposal of state assets can only be awarded to a business if government takes into account the B-BBEE status of the tenderer. The act states further “..and as far as is reasonably possible apply any relevant code of good practice issued in terms of this act.”
Although the act does not give a clear definition of “take into account” or ” reasonably possible apply”, and does not state how it should be applied, what is clear is that every state entity MUST at least ask for a valid B-BBEE certificate, and should give their own reasonable interpretation of how they are going to apply the codes to their particular tender or license.
Any government agency that does not do this is in breach of the act and therefore in breach of the constitution.
The act was signed into law in January 2004, and the Codes of Good Practice were gazetted in February 2007, so government has had more than 3.5 to implement its own policies.
There is no discretion at to whether or not government applies this clause.
Once they do, the affect will be that all organs of state will be asking all suppliers for their valid B-BBEE scorecards. This will result in focusing government on broad-based issues, rather than the old, discredited and annoying narrow-based method that they currently use. It will result in more compliance and improved transformation.
Government is doing nothing to further the good cause of B-BBEE
Posted by Keith in BBBEE Knowledge, politics on August 17th, 2010
I’ve come to the conclusion that government is doing nothing to further the cause of B-BBEE. The only organizations doing anything are in the private sector. Thousands of businesses have worked towards compliancy and obtained a scorecard. They give their scorecards to each other, because that is how B-BBEE is supposed to work. Each company asks the next one for a scorecard: there is no law forcing a company to get a scorecard, just the pressure from their customer in the private sector. When it comes to government, t stops working. Government does not ask for your scorecard, and few public enteprises and government departments even have their own scorecard. The incidence of compliance in the public sector is almost zero.
Some time back a survey was done by Consulta Research, purporting to show that government has made enormous strides in B-BBEE. That survey was flawed. They forgot the ask the only question that should have been in the survey: “Can you please give me your B-BBEE scorecard or B-BEE certificate.” That would have shown that private enterprise leads the way over government – in most cases the relevant government department or enterprise does not even know what B-BBEE means.
Government and departments have no scorecard, and neither do they ask for a scorecard when you may want to do business with government. If I want to do business with many of the large corporations MTN, Vodacom, FNB – the will ask for my B-BEE scorecard. This polite request, not always an demand has been sufficient for many thousands of businesses to work towards achieving a B-BBEE certificate. If government has to ask the same, the incidence of compliance would increase – probably double overnight.
Instead government chooses to focus on other areas, in contradiction to the B-BBEE codes. The debacle over ArcelorMittal is a case in point. Governmentis interested in 26% black ownership, which has almost nothing to do with B-BBEE. ArcelorMittal would want to get a B-BBEE certificate because their customers are asking, and ArcelorMittal has been promising this for years! Instead ArcelorMittal want to allocate 26% of their shares to meets government’s requirements, but this goes nowhere to helping ArcelorMittal get a scorecard.
Instead of furthering B-BBEE, and supporting those companies that have made a sincere effort, goverment is hindering B-BBEE.
Who is confused today?
Posted by Keith in BBBEE Knowledge, True Empowerment, politics on November 20th, 2009
Business Report has published an article quoting Jimmy Manyi, the director general of the department of labour, that government will get tough on companies that do not comply with affirmative action and B-BBEE laws.
I understand his frustration – we have the same frustration with companies that refuse to make any effort, while publicly stating that they support the initiative. Our clients lose points if their suppliers do not comply.
The confusion comes when Jimmy Manyi states “His department is planning on introducing a clause into the BEE act which would allow governmen to terminate or refuse contracts of companies that do not comply with the law by June next year.” The article further states “He said it was his job as the DG of Labour to ensure that this happened.” The fact remains that the B-BBEE act is administered by the department of trade and industry, not labour. I need to ask “Who is running B-BBEE – dti or labour or treasury?” In the case of employment equity, the department of labout is certainly responsible, but this forms only a small part of the BEE scorecard.
Jimmy Manyi wants to allow government to terminate or refuse contracts that do not comply with the law. The irony is that government currently does not follow the B-BBEE act. Treasury has been trying for some time to reconcile the PPPFA – the law that government does follow the the B-BBEE act, and it probably will not even be enacted by June 2010. It may well happen that the revised PPPFA makes it mandatory to follow the B-BBEE act, but this will be the responsibility of Treasury, not the DG of labour.
Another issue is that the B-BBEE act is based on a scorecard, so it is not feasible to state categorically that a company complies or does not comply. A key point of the B-BBEE scorecard is levels of compliance. Surely the new clause proposed by Mr Manyi should be based on levels of compliance? In any event it is compliance with the principles of B-BBEE, not the law. The act as is stands makes B-BBEE mandatory only for government and government enterprises, not companies. The dti believes that the cascading effect of each company asking every other company (their suppliers) for a scorecard is a good way to go about ensuring B-BBEE levels of compliance.
Ironically again the enterprises that should become compliant, and which Jimmy Manyi should be concerned about, are the many government enterprises that do not have scorecards, or have very poor scorecards. SAA is a level 8 – pretty poor for the national carrier. The PIC does not even know they need a scorecard!
While I have no problem in ministers and DGs condemning companies for not having a scorecard or not complying with any act, the message that is going out is totally confusing, and contradictory.
The problem with this approach is it encourages those who want to find an excuse to delay their implementation. They will now say they want to wait until the revised act is gazetted, or they want more information before thinking of implementing transformation. I know it is an excuse, and they should be condemned for this, but they will use confusing reports, such as the DG’s comments to justify their inactions.
I do support his call for government to refuse to do business with companies that do not have a BEE scorecard, my problem is that he is sowing confusion.
Julius Malema
If I can make a statement that so inflames you that you speak without thinking and jump to conclusions because you get so emotional about the subject, does that mean your true feelings are showing?
There are lots of issues we, South Africans, or even the world population does not agree upon. There are some that are absolutely certain to raise blood pressure and yield a response that you maybe may not have made in the light of day.
Issues such as rugby/sport, religion and politics are top of the list. If I said I think the KZN Sharks are useless, I know some people would disagree vehemently, and some would get quite rude and aggressive. If previously they were very placid, then when a big issue confronts them and they become aggressive, what can we say about those people? Are they placid or aggressive?
Now to racism and other “isms”: How do we judge whether a person is racist? If the person is derogatory towards a group of people, is he a racist? If he is derogatory to one person, but applies his logic to all people who belong to that group, is he a racist. If he makes nasty comments about Jews, based on his experience with one Jewish person, is he anti-semitic?
I’d tend to say that all the above is racism, sexism, anti-semitic etc depending on the particular group who is insulted, or feels insulted. I would think that even if a person states he is not a racist or anti-semite (”some of my best friends are black/Jewish”), his actions at some point or another may prove otherwise. These actions/feelings could be deeply embedded in one’s psyche.
Now to Julius Malema, He tends to rub many people up the wrong way, particularly white people. Recently, in welcoming Caster Semenya he condemned white people in also not coming to the airport. The interesting point is how they reacted. Many made rude comments about Julius, his mother, his racial group.
A common comment was “We were working”. Who is the “we”? All white people, therefore excluding black people? Many whites fell into the trap that Julius, maybe inadvertently, had set. Their reaction proved the point that Julius is always making. They responded with rude, racial comments right back to Julius. Disagreeing with a person does not make you a racist or anti-semite, or even a Bulls or Western Province supporter 
. Making comments about the group as a whole does make you a racist etc.
The point is the reaction of many people brought out their true feelings. I guess it’s not easy to hold back when he makes very aggressive comments. In a strange way he brings the worst, and best out of people, and in some cases proving his point. If this is by design or not – it does not matter. It is the reaction of the person that counts, and how I and others perceive that reaction.
Comments?
Appointment of new Reserve Bank governor
What will the detractors of BEE say now that a Black man has been replaced by a White person to head the South African Reserve Bank?
Personally, I see no problem with the appointment as long as she is the best candidate in the market. I have always supported the notion that BEE should make good business sense.
This appointment should send a strong message to those who think BEE is applied blindly on the basis of colour. BEE is about a progressive nation where every race is given an opportunity to contribute towards economic growth.
Ministries must work together
Posted by Keith in Enterprise Development, General, politics on June 12th, 2009
An article in the Business Report quoted the new minister of trade and industry, Rob Davies, as saying ministries must work together and specifically mentioned the need to help grow SMMEs.
It’s time for the minister to “walk the talk”. It time to talk to his colleagues in treasury, energy and those responsible for state owned enterprises to get their act in order – one single BEE code will help SMMEs, and improve BEE compliance. It time to stop making so many demands on SMMEs, like the requirement to have their BEE scorecard verified, and allow self-assessments.
The minister proudly states that regulations have been put in place in the new companies act to make compliance easier.
So they ease one area only to add red tape somewhere else!
The minister also states that government is trying to pay its SMME suppliers in 30 days. This is a big improvement over the existing situation of 3-6 months. However the enterprise development codes state that enterprise can earn BEE points by paying COD, or at least within 10 days. so once again government is setting stadnards for us, that they are not prepared to try to meet.
At least the minister is making the right noises – it’s time for him to really understand how SMMEs operate and the challenges they face and DO something.
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