MAT CUTHBERT: ANC continues to prioritise cadres over genuine empowerment

The ANC’s response to the DA’s Economic Inclusion for All Bill reveals how it continues to prioritise cadres over genuine empowerment.

With 44-million people languishing in poverty and 12-million unemployed, and SA still holding the dubious distinction of being the most unequal country on earth, it is unacceptable to believe that the situation can be maintained.

Despite the black middle class expanding in the early 1990s and into the 2000s due to a growing economy and expansion of the public sector, the black unemployment rate increased by nine percentage points from 2014 to 2024, and 30-million black South Africans now find themselves trapped in poverty. This is clear evidence that BEE has failed.

Not only has BEE left the vast majority of South Africans destitute, it has also served as a state-sponsored tool for corruption, exploitation and rent-seeking. Daily news headlines in SA are littered with examples of how tenderpreneurs have subverted public procurement laws, inflated prices and failed to deliver critical services.

Not only has BEE left the vast majority of South Africans destitute, it has also served as a state-sponsored tool for corruption, exploitation and rent-seeking.

One of the most glaring examples is Transnet’s 2014 locomotive contract, which unlawfully inflated the price of 1,064 locomotives from R39bn to R54bn to favour Chinese suppliers and channelled more than R6bn in kickbacks to Gupta family-linked companies under the pretense of transformation.

As if the looting of state funds meant for public services was not bad enough, state-sponsored corruption has become increasingly intertwined with murder. The names of Babita Deokaran and Mpho Mafole starkly illustrate this point.

Deokaran was shot multiple times outside her home because she courageously decided to expose the blatant corruption at Tembisa Hospital, which cost SA taxpayers R2bn. One doesn’t need to look far to identify those responsible for the alleged industrial-scale looting of public funds.

ANC cadres such as Hangwani Maumela, Sello Sekhokho and Vusimuzi “Cat” Matlala have all been subject to Hawks or Special Investigating Unit probes. Matlala has been implicated at the Madlanga commission, revealing his links to senior politicians and police officials. It is also alleged that he covered the costs for several party events and offered inducements to delegates.

Patronage networks, stolen wealth

Mpho met a similar fate to Deokaran when he was shot nine times in the head and upper body three days after reporting procurement irregularities and subversion of the supply chain management policies for a R1.8bn chemical toilet tender in Ekurhuleni.

These examples clearly illustrate the extent to which cadres will go to protect their patronage networks, stolen wealth and the exclusionary system that locks the majority of South Africans out of opportunity.

Considering the size of SA’s R1-trillion, or more, state procurement expenditure, there is a huge opportunity for public funds to be diverted away from critical infrastructure investments and frontline social services such as education, healthcare and policing, as illustrated above.

In 2017 acting National Treasury chief procurement officer Willie Mathebula testified before the Zondo state capture commission that more than 50% of the country’s procurement budget was lost through deliberate abuse of the system.

Why the Economic Inclusion for All Bill is so important.

Who are the most affected by the abuse of public procurement? Poor South Africans who depend on the state for most of the goods and services they receive. This is why the DA’s Economic Inclusion for All Bill is so important.

The bill aims to create a public procurement system that fosters genuine economic empowerment by providing incentives for tangible outcomes such as job creation, poverty reduction and skills development. It fundamentally reforms SA’s public procurement framework by aligning it with section 217 of the constitution, which governs public procurement and mandates that all state organs must contract for goods and services within a system that is fair, equitable, transparent, competitive and cost-effective.

In addition, the bill removes provisions for set-asides, prequalification criteria, subcontracting conditions and local content designations, replacing these measures with an outcomes-driven system focused on inclusive development and value-for-money procurement.

Our alternative empowerment scorecard, which accompanies the bill, aligns with the 17 UN sustainable development goals (SDGs), which serve as a universal call to action for the government, business and civil society to end poverty, address inequality and create a pathway towards sustainable economic growth by 2030.

The DA’s alternative scorecard has three components:

• A value for money component assesses the cost-effectiveness, technical capacity, reliability, innovation, compliance and operational capacity of bidders, which account for 80%.
• An economic inclusion component evaluates bidders’ proven contributions to the SDGs across five categories — human development, economic empowerment, environmental sustainability, inclusive communities and governance — and a mixed-impact option, which make up 20%. Instead of giving nominal ownership to ANC cadres, the DA’s plan aims to empower all South Africans lacking economic opportunities through skills development, scholarships and early childhood programmes. It also promotes job creation, small businesses, infrastructure investments, environmental projects such as renewable energy, recycling and reforestation, and community initiatives such as legal aid centres, urban greening and NGO partnerships.
• The disqualification criteria exclude bidders if there is documented evidence of fraud, corruption or misrepresentation. This guarantees that those guilty of abusing public funds are prevented from conducting business with the state.

The DA’s approach to empowerment fundamentally differs from that of the ANC. While the ANC’s policy is exclusive to cadres, the DA’s policy requires no political connections. Under the ANC, race remains the primary criterion, whereas the DA emphasises needs-based empowerment.

The ANC encourages a fronting culture, while the DA promotes social impact and value for money in procurement. The ANC continues to exclude small businesses, whereas the DA regards small businesses as vital partners in the fight against unemployment.

As a party that cares deeply for our country and its people it angers us to see how the ANC has used state resources to line its pockets instead of delivering much-needed services and upliftment to the people.

It doesn’t have to be this way. By strengthening the DA’s hand in government we can bring good governance to more national departments, deliver services and create a more prosperous SA for all.

Achieving economic inclusion for all is within our reach. I appeal to South Africans to get behind our bill and help us dismantle the exclusionary system that has prioritised ANC cadres over genuine empowerment.

• Cuthbert, MP, is DA head of policy.