Letter: Race-base relief unconscionable in time of crisis - Businesslive

22 April 2020 - We stand by this assessment, and the minister offers nothing to challenge its substance.

The Institute of Race Relations must thank tourism minister Mmamoloko Kubayi-Ngubane for the compliment she paid us in quoting from our critique of broad-based BEE (B-BBEE ).

It read: “Race-based empowerment policy has long been a burden on business, for both domestic and foreign firms, while having performed questionably at opening up opportunities for new entrepreneurs and having unquestionably failed to spur desperately needed economic growth. When the health emergency recedes, SA will need to go for growth with single-minded determination. It will need every ounce of entrepreneurial energy it can muster. The very stability of the country will be at stake if it does not.”

We stand by this assessment, and the minister offers nothing to challenge its substance. On the question of the tourism relief measures, the department intends to link its pandemic mitigation support to enterprises based on their B-BBEE credentials. This though numerous predominantly smaller firms have never been required by law to be certified or have not sought certification in pursuit of government and corporate contracts. They nevertheless pay taxes, support local economies and provide employment.

This is unconscionable — it is difficult to see this as anything other than denying assistance on racial grounds. As Justice Malala wrote recently: “The coronavirus has destroyed businesses, black and white. It’s destroying jobs, black and white. We need to save jobs, urgently, provided by both black-owned and white-owned small businesses. This is not the time to disburse urgent and necessary funding by race. You don’t need a genius to tell you just how spectacularly this will fail.”

Nor, we would suggest, does it take genius to surmise that in a country with a battered economy, economic contraction on top of long-term retardation, an unemployment rate in excess of 29% (watch this space), and a struggling small business community facing devastation, it is a policy that needs to be fundamentally rethought.

The minister’s position hardly speaks to an “inclusive” economy. Quite the contrary, in fact.

Terence Corrigan
Institute of Race Relations

https://www.businesslive.co.za/bd/opinion/letters/2020-04-22-letter-race-base-relief-unconscionable-in-time-of-crisis/

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