The affordable education loan option
The South African Broad-Based Black Economic Empowerment (B-BBEE) summit will take place from 3-5 October 2013 at Gallagher Estate, Midrand. This occasion marks a decade since the adoption of the B-BBEE Act No. 53 by the South African Government in 2003.
The Act was assented to with the aim of establishing a legislative framework for the promotion of BEE to end the exclusion of black people from the mainstream of the economy and de-racialise business ownership through focused policies of BEE.
The BEE Summit and the future of BEE in South Africa
BEE has come a long way since the first empowerment deal back in 1993, and has moved on from a narrow-based approach, where the focus was entirely on black ownership and management, to encompass all the relevant spheres of economic activity. Even though the private sector need not comply from a legal perspective, there are sufficient economic reasons for large corporations to comply and ensure that their service providers and suppliers are as compliant as possible.
Thus, the private sector has an economic incentive to comply, in addition to the moral imperative. In the words of the Minister of Trade and Industry: “Black economic empowerment is not just a social and political imperative. We need to make sure that in the country’s economy, control, ownership and leadership are reflective of the demographics of the society in the same way the political space does. That’s why we are saying BEE remains an economic imperative. We cannot expect to grow and develop as a country if the leadership of the economy is still in the hands of only a small minority of society.” – Dr Rob Davies, 2 October 2012.
The Director-General of the dti, Mr Lionel October, recently indicated that BEE is set to enter a new phase where black entrepreneurs will be assisted more rigorously to enter the mainstream economy, through incentivising companies to offer business support to black business owners and procure more from them. This will be achieved through increasing the number of points on the BEE Scorecard companies can obtain for these two measures. Expanding the country's entrepreneurial capacity would help create more jobs and spread South Africa's wealth more evenly.
The new trajectory for B-BBEE should include a focus on the following:
• Changing the South African culture to be supportive of entrepreneurship and diversification of value chains;
• A concerted effort to link B-BBEE with other government economic development strategies such as Industrial Policy, the Competitive Supplier Development Programme and the New Growth Path (the 'real economy');
• Empowerment efforts should result in the promotion of a culture of venturing into new territories, operational excellence and risk taking;
• Focus on businesses and industries that result in significant job creation and addressing socio-economic challenges; and
• A symbiotic relationship between the public and private sectors and among private sector players and large and small enterprises to unlock opportunities.
The summit is an opportunity to create dialogue on these and other key issues and questions relating to the B-BBEE policy and legislation.