I wanted to stay out of this for a while, but I am now drawn in. It was quite a surprise to see the headline on the front page of Business Day yesterday (Fuel giants warned to pump up BEE efforts), it is quite sensational and untypical of Business Day. The story revolves around a "warning" made by minerals and energy chief director of hydrocarbons Nhlanhla Gumede (not the minister you will note). He said that "licensing would be used as a tool to achieve compliance, with licences possibly being withdrawn or withheld if companies did not make efforts to meet their commitments."
Section 10 of the BBBEE Act allows the state to query empowerment credentials before issuing licences, concessions etc. Gumede would make use of this section and the requirements of the new Petroleum Products Act, the act speaks of the Petroleum transformation charter and makes it a condition for awarding a licence (which is strange because the charter has not been gazetted!)
However you have to consider the implications of using section 10. Withdrawing licences could result in many people losing their jobs and the country riding bicycles. Section 10 is there as a last resort and should be used if all other avenues have been exhausted.
The Business Day responded today in the Opinion and Analysis section Fuelling empowerment. They make the valid point that there is a desire to transform and that the liquid fuels sector were the darlings of empowerment a few years ago. The problem they face lies in finding suitable black investors who have access to capital. The editorial notes that the procurement target could be easily achieved by contracting crude oil through a black-owned middleman, they wisely discard this idea, but observe that the industry has made great strides in employment and training.
People of the petroleum industry (especially you in government), empowerment is about elevating previously disadvantaged people through employment, skills development, enterprise development and CSI. Focus on those things and the ownership element will sort itself out.
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