SONA 2022: Ramaphosa’s golden opportunity to announce veto of flawed employment equity law

President Cyril Ramaphosa has a golden opportunity when he delivers his 2022 SONA tomorrow to announce that he will veto the deeply flawed Employment Equity Amendment (EEA) Bill and send an unambiguous signal that his administration is making a clear break from the failed policies that have led South Africa down a zero-growth path.

So said IRR Head of Campaigns Gabriel Crouse at the announcement of the Institute’s petition to back the call for Ramaphosa to veto the Bill. [https://irr.org.za/campaigns/stop-race-quotas]

Crouse said: “Rather than cutting red tape and embracing merit, which is the best chance most black South Africans have of a more prosperous future, the EEA Bill will redouble incentives for cadre cronyism. This is unconstitutional citizen abuse and Ramaphosa should speak out against it.”

The EEA Bill was approved by the National Assembly at the end of last year, and now stands before the National Council of Provinces where it is expected to receive assent without alteration. However, in terms of Section 79 of the Constitution, President Ramaphosa must veto any bill if he “has reservations about its constitutionality”.

In the context of South Africa’s 34.9% unemployment rate and general economic stagnation, President Ramaphosa can use his State of the Nation address tomorrow to announce his intention to veto the EEA Bill – and thus send a strong signal that his administration is serious about reform geared to growing the economy and building a better future for all South Africans.

However, if the Bill is allowed to become law, it will empower the Minister of Employment and Labor, currently Thulas Nxesi, to set regional, sectoral and sub-sectoral race quotas, described as “numerical targets”, for the bulk of the private sector. These quotas would be set at the Minister’s discretion.

Without meeting the stipulated race quotas businesses could suffer a ban from government contracts – even those businesses that offer taxpayers the best value for money. This would violate Section 217 of the Constitution.

In addition, the EEA Bill requires businesses to take on the task of establishing the race of all employees, whether by an apartheid ‘pencil test’ or some other mechanism unspecified in the EEA Bill, failing which they can suffer R2.7 million fines, or fines equal to 10% of annual turnover for a “repeat offence”.

Said Crouse: “The EEA Bill would effectively take the tools of social engineering and cadre deployment that have been applied in the public sector – and which incentivized corrupt elements of the financial services sector too – and force them through the private sector in general. In cabinet it seems nothing has been learned from the last decade-and-a-half. If Ramaphosa wants to make things better, he will veto this Bill to stop them from getting worse first.”

IRR polling shows 80% of South Africans would prefer to turn away from BEE and Affirmative Action and towards need-based vouchers for social services. IRR polling also shows that a greater proportion of white people than black people believe they would personally benefit from keeping race-laws instead. This may indicate a further sense in which social engineering policies in South Africa do not have the effects they supposedly intend.

The argument against the EEA Bill’s constitutionality is laid out it in detail in the IRR’s petition to President Ramaphosa. Problems range from the lack of a coherent and contemporary socio-economic impact assessment to a fundamental derogation from the Constitution’s Chapter 1 protection of non-racialism.

Particular attention is worth paying to the language of the Constitution in Section 9, the Equality Clause, and Section 195, on Public Administration, which set basic rules on racial preferences in employment. Section 195 indicates that the Constitution’s call for “broad representativity” is confined to the public sector.

However, the EEA Bill not only substitutes “broad representivity” with narrow “numerical targets” or race quotas, but also applies the quotas more broadly than the Constitution allows by ramifying them across the private sector too.

Concluded Crouse: “Basically, the EEA Bill is BEE on steroids, which comes as no surprise since Ramaphosa’s cabinet has promised ‘more aggressive BEE’ throughout the last four years.

“Most South Africans know that BEE really stands for Blatant Elite Enrichment and Ramaphosa would gain support by turning against quotas. We encourage citizens to read up on the petition and sign the call on Ramaphosa to block a new form of pencil test from going nationwide.”

Media contacts: Gabriel Crouse, IRR Head of Campaigns – 082 510 0360; gabriel@irr.org.za
Chris Hattingh, IRR Deputy Head of Campaigns – 083 600 8688; chris@irr.org.za
 
Media enquiries: Michael Morris Tel: 066 302 1968 Email: michael@irr.org.za