So, while you were sleeping, or on holiday, or buzzing around town preparing your kids for school, the department of employment & labour has been hard at work.
From mid-February companies throughout the economy employing 51 or more people will be dialling into sectoral virtual meetings with the department to begin a consultation.
They will be talking about how, precisely, sector by sector, plans will be made and recorded for the purpose of monitoring, all companies will ensure their staff complements begin to better mirror the demographics of the country, and in particular the region around them.
You’ll remember the Jimmy Manyi of old taunting businesses more than a decade ago about racial quotas — are there too many Indians in your Cape Town courier business, too many so-called coloureds in your Mpumalanga sugar mill? Well, the employment & labour minister will now decide in terms of the Employment Equity Amendment Act, which came into force on January 1.
Companies in the mining and quarrying, water supply, sewage, waste management and remediation activities sector, and the wholesale and retail trade, repair of motor vehicles and motorcycles and every other economic activity in between, will be consulted and then handed new sector-specific racial employment targets and accompanying regulations. It’s all about to happen.
The letter to CEOs and chief equity officers of companies in a typical sector reads that “in accordance with Section 15A (2) of the EE Amendment Act, which mandates the setting of numerical sector targets to address the underrepresentation of designated groups of the workforce in the workplace, the Commission for Employment Equity jointly with the department of employment & labour would like to convene a virtual consultation meeting with your sector.
It is the eternal ANC dilemma — it needs to choose inclusion, or transformation, or it needs to choose growth. It has been unable to make both happen at the same time ...
“The purpose of the meeting is to discuss the proposed sector numerical EE targets for the Electricity & Gas, Steam and Air Conditioning Supply Sector before publishing the final sector EE targets for implementation. The details of the virtual consultation meeting are as follows: Date: Friday, February 14 2025 Time: 12h00-13h00 Platform: Microsoft Teams”.
So hurry, hurry. I know many of my friends who count themselves as African nationalists would be perfectly comfortable with this sort of social engineering. In another reality though, it is utterly destructive, an admission that 30 years of employment equity (affirmative action) hasn’t “worked” and that, typically for the ANC, its answer is to dig the hole deeper in the woeful expectation that somehow, this time, with force and compulsion, it’ll work.
It won’t. The ANC has lost touch with the real world. It has no idea what it is like to really employ 51 or more people full-time, to pay their salaries on time every month, to make provision for their pensions and health benefits while fighting off the competition, government regulation on all sides, paying rates and taxes in ANC-run cities that have completely broken down, paying back your debt while the state you had that contract with hasn’t paid you now for three years.
More racial engineering isn’t going to create a single job. Most well-run small companies get to the point where their owners have to decide whether to expand or stay small. Given that the new laws don’t apply to businesses with fewer than 50 staff most will now probably elect to stay that way. Why invite a world of pain by opening a branch with 10 new staff in East London?
Happily for the cheering gallery, the new laws coincide with the creation of a R100bn Transformation Fund announced by trade, industry & competition minister Parks Tau, who reminded companies that BEE legislation requires them to pay the equivalent of 3% of posttax profits to black-owned companies.
Add the Transformation Fund and the new equity laws to other regulations like a 30% stake for BEE partners in new investments, or local content laws, and you see the ANC building an almost perfect armoury to suppress investment while convincing itself that what it is doing is just and right.
It takes a lot of courage to start even the smallest business, even in an open economy. In SA the rules just make no sense. There must surely be a political party somewhere in this country that understands how to incentivise enterprise rather than always to suffocate it?
President Cyril Ramaphosa believes he has 10 big infrastructure projects “shovel ready” for this year. We will see. He should talk about them more loudly and more often so we can judge. Where will the money come from? Who in their right mind would risk partnering with this government in any enterprise other than an absolute slam-dunk?
Don’t be fooled by foreign investment into the JSE. It doesn’t touch sides and will go the moment there’s a better deal somewhere else. Welcome to Ramaphosa’s always ephemeral world of “inclusive growth”; it doesn’t actually exist even though he uses the term all the time. He gets to regulate and even enforce the inclusion, but he doesn’t or can’t do growth.
It is the eternal ANC dilemma — it needs to choose inclusion, or transformation, or it needs to choose growth. It has been unable to make both happen at the same time, and while it’s clear inclusion doesn’t guarantee growth it doesn’t have the political courage to chase growth to create more inclusion.
And where, you have to ask, is the DA, now so happily wrapped up in the government of national unity (GNU)? It rolled over to allow the Basic Education Laws Amendment Bill on the shaky ground that it would have a hand in writing the regulations for the bill. Will the same apply to National Health Insurance when Ramaphosa brings it into law, as he almost certainly will?
Two years ago the DA led protests about the race quotas about to be imposed on companies. Where is it now? A quiet mutiny is beginning to gather inside the DA as MPs, many of whom would once have been shadow ministers of this or that, with trenchant views on the news of the day, are now required by GNU membership to keep quiet and toe the line in the face of outrageous or simply foolish policy.
DA leader John Steenhuisen’s rush into cabinet has rendered his MPs mere voting fodder, and something will break soon. Watch this space.
• Bruce is a former editor of Business Day and the Financial Mail.
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