Vol. XI, Issue 3 (Summer 2004): South Africa
Peter K. LeMaire
Bernice A. LeMaire
For more information
concerning Africa Update
A Tribute to Mosebjane Malatsi, Former National Secretary of the PAC, South Africa
This issue of Africa Update is dedicated to Mosebjane Malatsi, killed in a tragic motor accident in May this year. He was one of the regional editors of Africa Update. Malatsi was also a prominent member of the Pan African Congress (PAC) and served as a national secretary until his untimely death.
Malatsi was a visiting fellow at St. Antony’s College, Oxford University in 1990. Before that he served as a consultant to several UN agencies, including the UNDP. He returned to South Africa and served as a senior policy analyst at the Development Bank of South Africa Johannesburg. Born in Limpopo province, Mr. Malatsi was an anti-apartheid activist for almost half a century. The introduction of the Bantu Education Act in the mid 1950’s led to Mr. Malatsi’s first major protest against white domination. He found offensive the denial of mathematics education for Africans. Robert Sobukwe, the founder of the Pan African Congress urged him to go into exile for safety, which he eventually did despite interception and arrest by the South African apartheid forces.
At a conference organized in November 2002 in Gauteng by the Institute for Security Studies (ISS), on the theme “Where Money Meets Politics” Malatsi was an important participant. The meeting focussed on ways to regulate the inflow of private funds on South African election campaigns. Mosebjane Malatsi was a fervent opponent of the privatization of state industries, which he considered to be “pandering to the free market system” that allowed profit before people. By 2004 he had become National Secretary of the PAC after returning to South Africa thirteen years earlier. A month before his untimely death Malatsi had expressed his concern over election fraud. For more on this matter see http://www.iol.co.za.
Included in this issue is an illuminating discussion on the judicial process in contemporary South Africa by Mike Kimbi Joko. We also include interviews of Professor Pitika Ntuli of the University of KwaZulu - Natal and Opsile Npsoane of the University of the Northwest, Mafeking, South Africa, on some of the challenges confronting South Africa.
We dedicate this issue of Africa Update to Mosebjane Malatsi. Dr. Gloria Emeagwali Chief Editor
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In this paper we examine the judicial process in South Africa in terms of the Black economic empowerment process and some of the post- apartheid laws that gave rise to this process. We start from the post - apartheid constitution of the Republic of South Africa through the Employment Equity Act, government regulation and self regulation, and some of the ethical challenges that have emerged as a result of the process.
The Economic Impact of the Group Areas Act of 1950
During the apartheid years in South Africa, the imposition of the apartheid machinery extended into townships. It also imposed restrictions on the manner in which business was done. Different race groups were specifically prohibited by law from owning equity in the same company. The resulting consequence of these laws was the non-integration of various race groups in the business arena, an advancement of people of Caucasian descent, and the economic stagnation of non-Caucasian groups. The gap between the rich and the poor grew larger and larger. After apartheid was dismantled in the early 1990’s, things had to change to accommodate the new order. For there to be social stability in the new South Africa, all race groups had to be seen to be upwardly mobile. Promises had been made during the apartheid period about what liberation would bring. Expectations were high as the population demanded to see what they had been fighting for. It is the action that the new Black regime in power took in terms of the legal machinery that we attempt to examine.
The Use of Law
a) Constitutional Baptism.
Negotiations leading to the end of apartheid made provisions for the enactment of a new constitution. Among other issues that were striking in the negotiation process was the integration of all racial groups. The enactment of a new constitution for post- apartheid South Africa was the beginning of the judicial process: the use of laws to change or socially re -engineer social policies in the new South Africa.
The equality provisions of this new constitution, specifically Section 9(2), states:
“Equality includes the full and actual enjoyment of all rights and freedom. To promote the achievement of equality, legislative and other measures designed to protect and advance persons disadvantaged may be taken”.
These protective measures for the advancement of persons disadvantaged by the former apartheid regime began with the constitutional process. From its origins some of these protective measures have been construed as reverse racism or discrimination and has even been attacked in the courts. The South African courts have found them constitutionally sound and they are deemed to be proper and just. As such any cry of foul play against the present majority government in this country is difficult to sustain even in law courts. These actions taken by the government were specifically to redress past imbalances created by decades of discriminatory, degrading and stagnating policies of the apartheid regime by helping the upward mobility of the previously disadvantaged race groups and not as revenge or reverse racism.
b) State Influence - in certain types of contracts and licensing arrangements.
Having justified constitutionally that it is permissible to allow for an amount of discrimination for developmental reasons based on constitutional grounds- to enhance economic integration of citizens- the legislature passed the Employment Equity Act 55 of 1998 and other legislation that had the effect of influencing contractual relations in the business community.
The Employment Equity Act pushed for integration at two levels, namely, the relationship between designated Employers and Employees, and, the relationship between designated employers and the state.
Section 20 of the Employment Equity Act imposes a duty on all designated employers to protect, train and promote individuals from the previously disadvantaged communities based on an employment equity plan.
In terms of the relationship between designated employers and the state, Section 53 states:
“Every employer that makes an offer to conclude an agreement with any organ of state for the furnishing of goods or supply of services to that organ of state or for the hiring or letting of any thing must, if a designated employer, comply with chapters 2 and 3 of this act”.
Chapters 2 and 3 of the Employment Equity Act deals with the creation and implementation of an employment equity plan. Simply put if you have not complied with the Employment Equity Act by creating an employment equity plan and are implementing it you cannot contract with the state.
Section 53 has the indirect impact of enforcing section 20 of the Act in enticing companies to advance employment equity goals and promote their equity plans. Compliance with the Act is sometimes seen as a burden in terms of costs and production. Training new employees or unqualified ones has a cost on training, efficiency and production. One may argue on the other hand that such costs are balanced by contracts won from the government should such a gesture of complying with the Act give rise to new business in terms of contracts with the state.
The spirit of the Employment Equity Act has filtered into other legislation. A classic example of this is the Competitions Act 89 of 1998.The purpose of this Act was to prevent monopolistic practices by companies. This Act does so by prohibiting mergers and acquisitions that will result in entities that may be monopolies or create a less competitive business environment. However at section 3(b) (ii) an exemption to such a stance is taken if the resulting entity will promote the ability of firms controlled by historically disadvantaged persons to become competitive. This in essence means that where two firms in performing a merger and acquisition would otherwise have been barred the promotion of Black economic empowerment could generate a waiver in the Competitions Tribunal. This is another enticing tool for racial integration in the business arena.
Government Control and Regulation
Based on constitutional blessings and the employment Equity Act, the impact of the requirements to integrate the South African race groups is felt in the granting of state contracts and the issuing of licenses and permits, especially when state licenses and tenders are competed for in public. It is a common feature to demand that Bidders or competitors demonstrate a serious Black economic empowerment component in their bid to win licenses. This demand has led to a wave of merger and acquisition activity and joint venturing in the corporate sector. The principal targets for these corporate activities are Black run enterprises.
Self-Regulation and Resistance
The judicial process has threatened areas where dominance by white owned corporations had endured for years. The oil, gas and mining sectors, and other areas of high finance are redefining themselves to fit with the government’s empowerment ideals as raised in the energy white paper. An example of private industry initiative in this area is the Oil and Gas business sector that has set itself quotas for empowerment or Black ownership in terms of years and the percentage of the business that should be in Black control.
It is now quite common in the list of directors in most of South Africa’s large corporations to see the names of Black directors usually ex-politicians.
Policing of the process is one of the biggest challenges. The Black economic empowerment commission was created in 1999 by a presidential mandate to deal with the process. One of the problems it suffers from is the lack of legislative teeth to correct the process where necessary. The result has been a Black Economic Empowerment Commission that can only recommend. This is in contrast to Canada where the Human Rights Commissions are charged with annual monitoring and reports to the Canadian parliament in terms of the Canadian Employment Equity Act. This gives an enforcement body the chance to achieve objectives that are set.
Reverse racism is a common attack on any pro affirmative action program. In the absence of a viable monitoring mechanism, allegations of reverse racism are common from some quarters. In the case of South Africa, young whites that had not directly benefited or enforced apartheid see themselves as having no future in the new South Africa. This perception has led to mass emigration from South Africa by whites, young and old alike to countries such as Australia, the United Kingdom and other western countries, thus taking with them valuable skills and resources.
An argument has been raised that promotion based on race or color defeats meritocracy and as such places the entire system in danger of eroding away a culture of excellence. Careful monitoring is required here.
Last but not least in terms of these challenges is the timelines for the empowerment process. Proper timelines are necessary with regards to how long the process has to go on and measurable goals. Some individuals from the black community may not even need the protection of the system. E.g. the child of a successful medical practitioner or other like professional cannot claim fifteen years from now that he is a previously disadvantaged individual.
Part of the empowerment process that the present South African government has to address is reparations for the victims of apartheid as suggested by the Truth and Reconciliation Commission. Restitution must be made. This is an issue the present government seems very reluctant to do. A class action suit in the state of New York has been filed against companies that had supposedly benefited from the apartheid system, but nothing much is being done in South Africa itself, with the exception of the Land Redistribution Program. Some form of meaningful compensation will lead to, at the very least, financial empowerment if only for a while.
It may be also logical to argue that the ethical issues raised against the empowerment process in South Africa are still too early. That might be so if the time frame is judged against the period the rest of the world took to respond to apartheid. It is common knowledge that the then British Prime Minister Thatcher claimed that she was against sanctions on the grounds that they would worsen the conditions of the Black worker in South Africa. Whatever its criticism, empowerment is necessary for social stability in South Africa.
1. M. Kimbi Joko holds a Master of Laws from the University of Natal, South Africa. He was formerly a legal consultant at Siwendu Ngakane and partners, Attorneys, South Africa. This was part of the research for the Masters thesis entitled “Investor protection in Empowerment schemes of arrangements and joint ventures”.
2. Sections 15-17 of the Group Areas Act 41 of 1950.
3. Act 108 of 1996
4. Rycroft, A “Obstacles to employment equity? The role of judges and arbitrators in the interpretation and implementation of affirmative action policies”. Volume 20 Industrial Law Journal 2000 at 1411 refers to juridification or the judicial process as “the use of law by the state to steer social and economic life in a particular direction by limiting the autonomy of individuals or groups to determine their own affairs”.
5. Pretoria City Council v Walker 1997(4) SA 189 (T)
6. Section 1 of the Employment Equity Act of 1998 defines a designated employer as one who employs fifty or more employees or one with an annual turnover of two million South African Rand for the agricultural industry, seven and a half million for mining and quarrying, ten million for manufacturing and the energy sector companies like oil and gas and electricity, five million for construction, catering, accommodation and some service industries, municipalities, all organs as defined by section 239 of the South African Constitution excluding the army and intelligence services, all employers bound by collective agreements in terms of section 23 of the Labour Relations Act 1995 to the extent to which they are bound by the collective agreement.
7. In practice, an employment equity plan constitutes a survey of all non-whites in an organization, their status in terms of jobs, qualifications and experience and a statement of goals in terms of movement from one tier to the other.
8. Kobokaoane, T “Euphoria gives way to reality in the business world” Sunday Times Business Times July 30 2000 at page 8. Commentaries by this author on the cost of insufficient skills and its impact on businesses in empowerment circles.
9. The requests for proposals the South African Telecommunications regulatory authorities in granting a third cellular phone license, and the requirements of the Kwa-Zulu Natal Gambling board for the issuing of the five casino licenses in that were being issued in that province all required the demonstration of strong black economic empowerment and compliance with the Employment Equity Act.
10. See the Empowerment Charter created by The South African Petroleum Industry Association. See also the South African Truth and Reconciliation Commission final report.
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Interview with Professor Pitika Ntuli of the University of KwaZulu- Natal held at the Africa Center, London, April 2004. The interviewer was Dr. Gloria Emeagwali of CCSU.
GE: Professor Ntuli it is quite a pleasure meeting you. What is your role in the new South Africa, Sir?
PN: I am currently the Executive Director for Organizational Culture and African Scholarship in the newly merged University of Kwa Zulu Natal which brought together the white university of Natal and the Historical Indian University of Durban. The majority of students are Africans. So my task is to ensure that these newly merged cultures function together and that we build a really singular leading university. Our mission and vision for the new university is the creation of a premier leading university of African scholarship, which lies within my office.
GE: That must be quite a challenge. What do you consider the greatest constraint so to speak and how have you been able to overcome some of these?
PN: The areas of constraints come from two sources. Firstly you come up with two institutions, each one with its own particular culture of doing things, and also from a racially divided society and the legacy of apartheid. The suspicion that one university holds against the other and the smaller university suspecting that it has not been a merger but that it is being swallowed up. So having to set up workshops to build a joint vision is a daunting challenge. The second problem is that our universities in South Africa are universities in Africa and not African universities and the predominant ideas are eurocentric. So to challenge that and also using the argument for the resurrection of African knowledge systems raises numerous challenges and insinuations and notions about the lowering of standards.
GE: What about funding?
PN: South African universities are fairly well resourced although there is no resource that is sufficient.
GE: So funding has been from the central government.
PN: Yes. When the Vice Chancellor took up office he received funding from the Melon Foundation. His vision was to make the university responsive to the needs of the country, better to engage with a globalizing world and to create a kind of competitive advantage. Are you a member of the ANC?
No. I gave up politics in order to retain a critical eye as an intellectual.
GE. South Africa is now ten years old in terms of electoral politics. An election is coming up soon. What are you v your views. What has the new South Africa achieved?
PN: South Africa as a country has been able to put into place enabling structures that are very good but the problem is implementation. Our own higher education continues to teach issues that are irrelevant to the community and the university has continued to be elitist. For me to answer this question let me personalize the issues. Last year I sat with about three different ministerial meetings. What should be the role of traditional leadership? One of my tasks was to ensure that IKS permeate the curriculum, from Biology to the Arts, if not by the time the students got over to the university they would be unprepared.
GE: It seems to me that South Africa us indeed a leader in terms of IK. Have you linked up as yet with some other African country?
PN: I am happy you have asked this question. Four weeks ago there was a meeting that took place in Tanzania on IKS. South Africa has now worked on a bill to protect the intellectual rights of traditional doctors.
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INTERVIEW OF OPSILE NPSOANE ON AIDS IN SOUTH AFRICA. The interview of Opsile Npsoane (ON) of the University of The Northwest,Mafeking, South Africa took place in Johannesburg in 2002.
The interviewer was
Professor Gloria T. Emeagwali (GE) of Central Connecticut State
GE: What about AIDS? Do you think the cure is going to come from the traditional medical practitioners?
ON: AIDS is a trillion-dollar industry. It is highly manipulated and highly controlled. If AIDS were a naturally derived disease we could have gotten a cure in Africa but given the way AIDS manifests itself- camouflages itself, disappears and re-appears- this is difficult.
GE: Do you agree with President Mbeki’s stand on AIDS?
ON: I am not a politician. If I were I would have commended him. He scored some political points.
GE: I don’t think so. I think politically speaking he lost marks.
ON: I think we need to address the issue of availability and access in each country and assess what the people can provide on their own initiative. The West wants to patent and control the show because pharmaceuticals involve a lot of money.
GE: What of the African potato?
O N: It does not cure AIDS but it boosts the immune system in terms of the white blood cells.
GE: There have been a few Nigerian claims we have to look into also. Is it true that one in five persons in South Africa, Botswana and Zimbabwe has aids?
ON: Well statistics are statistics. People dispute them. In fact statistics are not a-political and the general population does not go for tests. In any case, though, the fact is that HIV-AIDS is around. It is destroying our families and killing our people and we have to do something about it.
GE: Finally, Are you satisfied with the way that the South African government is handling the AIDS crisis in terms of educational programs and so on. Do you think that there is more to be desired?
ON: Well there is too much posturing in addressing the problem of HIV-AIDS. We should work within communities to address this problem. I am a bit disturbed at the kind of attention that is being drawn. AIDS campaigns have now become business for other people. Some NGO’s are even making money from the problem.
 Michael Joko holds a master of laws from the University of Natal, South Africa, formerly a legal consultant at Siwendu Ngakane and partners, Attorneys, South Africa. This was part of the research for the Masters thesis entitled “Investor protection in Empowerment schemes of arrangements and joint ventures”.
 Sections 15-17 of the Group Areas Act 41 of 1950.
 Act 108 of 1996
 Rycroft, A “Obstacles to employment equity? The role of judges and arbitrators in the interpretation and implementation of affirmative action policies”. Volume 20 Industrial Law Journal 2000 at 1411 refers to juridification as “the use of law by the state to steer social and economic life in a particular direction by limiting the autonomy of individuals or groups to determine their own affairs”.
 Pretoria City Council v Walker 1997(4) SA 189 (T)
 Section 1 of the Employment Equity Act of 1998 defines a designated employer as one who employs fifty or more employees or one with an annual turnover of two million South African Rand for the agricultural industry, seven and a half million for mining and quarrying, ten million for manufacturing and the energy sector companies like oil and gas and electricity, five million for construction, catering, accommodation and some service industries, municipalities, all organs as defined by section 239 of the South African Constitution excluding the army and intelligence services, all employers bound by collective agreements in terms of section 23 of the Labour Relations Act 1995 to the extent to which they are bound by the collective agreement.
 Kobokaoane, T “Euphoria gives way to reality in the business world” Sunday Times Business Times July 30 2000 at page 8. Commentaries by this author on the cost of insufficient skills and its impact on businesses in empowerment circles.
 The requests for proposals the South African Telecommunications regulatory authorities in granting a third cellular phone license, and the requirements of the Kwa-Zulu Natal Gambling board for the issuing of the five casino licenses in that were being issued in that province all required the demonstration of strong black economic empowerment and compliance with the Employment Equity Act.
 See the Empowerment Charter created by The South African Petroleum Industry Association.