In an audacious move to shake up South Africa's empowerment landscape in KwaZulu-Natal, Indians and coloureds could in future be blocked from state contracts of more than R50-million.
The bid to reshape BEE policies to benefit "black Africans" is being spearheaded by KwaZulu-Natal economic development MEC Sihle Zikalala. The proposal was sent to National Treasury Director-General Dondo Mogajane in August.
It is being seen as a possible template for sweeping change in empowerment legislation to incorporate the objectives of "radical economic transformation" being touted by President Jacob Zuma. It is in line with "Operation Vula", a provincial plan to accelerate BEE, which Zuma has endorsed.The provincial treasury this week said though the memo was sent by Magagula, Zikalala and his department championed it.
Operation Vula was launched by the KwaZulu-Natal government at an event attended by Zuma in June in Ixobho. Zikalala, who spoke at the launch, said research conducted by the province in 2014 showed white companies were benefiting, followed by Indians, then Africans and coloureds.
"After that study there was a provincial procurement indaba. The indaba agreed that in the procurement spend young people must benefit not less than 35%, women not less than 30%, the military veterans ... 10% and people with disability 5%. You need a policy to advance that. That's why there was a submission to the Treasury," he added.
The request has been described as regressive by South African Muslim Network chairmanFaisal Suliman.
"There is no doubt that apartheid was a tier system and that Indians and coloureds were not as badly affected as black Africans. But ... it sends the wrong signal and it is a wrong way to approach redress."
He believed statistics would show that those who benefited most from government contracts were politically connected.
"We all want to see the distribution of wealth to the people, particularly the previously disadvantaged, but not to people linked to comrades of any political affiliation," he said.
BEE legislation, such as the Broad-Based BEE Act and Preferential Procurement Policy Framework Act, defines black as Indians, coloureds, Chinese who were in South Africa before 1994, and black Africans.
Besides this reclassification, Zikalala also wants the province to be exempt from the PPPFA laws dictating the ratio between preference and price in public procurement...