Paul Janisch

A decent job - Jerry Schuitema

I had a decent job once.

And its definition is very different from that of Cosatu or the ILO which says: “Decent work is the availability of employment in conditions of freedom, equity, security and human dignity.”  Like some lofty constitution in trying to say everything, it says nothing about the real texture of how that translates into a working environment.

My definition is simpler: “Decent work is that which gives a sense of meaning in being able to make a contribution to another.” There were elements of that in the decent job that I once had. Clearly not all can be applied to the workplace, but many can. Many are self defined. They are certainly not easy to capture. Those who can find them are the most fortunate among us.

via www.moneyweb.co.za

Its critical performance areas covered nursing, bronchial physiotherapy, housekeeping, cooking and cleaning.

Worth reading

the Namibian: Govt pockets all rights to mine uranium

Govt pockets all rights to mine uranium (with my comments in italics)

(the Namibian) CABINET has declared uranium, copper, gold, zinc and coal as strategic minerals to allow the State-owned Epangelo Mining Company “exclusive exploration and mining” rights, Mines and Energy Minister Isak Katali told Parliament yesterday.

Katali said Cabinet recently approved a submission in this regard “so that the Namibian citizen can fully reap the benefits arising from the rich endowment of our mineral resources”.

Oh - but isn't this what we are doing (SA that is)

Mining last year contributed about 15 per cent to the country’s gross domestic product and its export earnings were more than half Namibia’s total export revenue. Namibia recently retained its position as the fourth biggest uranium producer in the world.
Katali said his Ministry’s priority this year will be to finalise the Minerals Bill and minerals policy to allow Epangelo “to fully participate in the exploration and mineral development” in the country.

Yes - this is exactly what we are doing.  Oh well

Katali also said Government is fully aware that black economic empowerment (BEE) is abused by some to make “phenomenal amounts” of money.
He said some BEE companies are “fronting”, a practice where foreign companies use local empowerment companies to clinch deals. The Minister said he also knows of BEE licensees “selling out” exploration licences as soon as they are granted them.

This type of legislating is fundamentally anti-capitalist (which is not a good thing).  People invest for a return, get the return and then move on.  Legislating for black people to retain their ownership is counter-productive.  PLEASE don't make the same mistakes South African has made - you really don't have to!!!!!!!

The Minister also told Parliament that as soon as Government’s Transformational Economic and Social Empowerment Framework (Tesef) is finalised, BEE charters for the electricity, petroleum and mining sectors will be implemented to ensure that previously disadvantaged Namibians benefit.

We are now seeing the shape that TESEF is going to take.  Somewhat similar to ours with industry charters (they have an approved financial services charter).  

“I am happy to announce that the mining charter is at an advanced stage of completion and will be gazetted as soon as all the steps are conducted,” he said.

Let me guess, it's going to be like SA's - you know legislated and not a voluntary thing.  SA's is a mess and will not achieve the targets that it has set because it's not reasonable.  As David Crosby once said - don't do it man.

via www.namibian.com.na

Allow the entrepreneurs to grow the economy -Eustace Davie

Government’s faith in government investment and spending, including investment in state-owned enterprises, is misplaced.

Mankind has not been delivered from abject poverty in the last three centuries by kings or governments but by the activities of entrepreneurs who have constantly and persistently discovered new ways of utilising resources for the benefit of consumers. Unfortunately, this vital function entrepreneurs perform is little understood, often not appreciated, and sometimes vilified, even by their greatest beneficiaries.

via moneyweb.co.za

Too true. Well worth reading

New state bid to make BEE more hands-on

New state bid to make BEE more hands-on (edited)

CAPE TOWN — Amendments to the Broad-Based Black Economic Empowerment Act, aimed at shifting its focus from equity deals to enterprise development, will be tabled in Parliament by July.

They would also address sharp criticism of black economic empowerment (BEE) as only benefiting a small elite and creating a class of passive black shareholders rather than entrepreneurs actively engaged in economic activity.

Department of Trade and Industry acting director-general Lionel October said the recommendations of the advisory council  would shift the focus of BEE away from equity investment and ownership towards productive activities.

Currently, companies scored high marks on the BEE scorecard for black ownership, which gave them a high overall score even when they performed poorly in areas such as enterprise development and procurement.

A proposal being examined by the economic cluster is that minimum scores would be required for enterprise development and procurement — or the overall score would suffer. This would compel companies to aim for achievement in all areas.

Mr Davies said what was under consideration was that points would be deducted from the overall score if minimum scores for enterprise development and procurement from small companies were not achieved.

It would also not be enough to merely hand over money for an incubator or enterprise development project. Companies would have to be actively involved in fostering small businesses.

"In Asia, small and big businesses have a symbiotic relationship where big business gets a lot of input from small business and works hard to ensure that it has the required capacity and the technology," Mr Davies said.
via www.businessday.co.za

So what do you do, clap your hands vigorously and chant "should have happened a long time ago".  

The italicised and highlighted sentences are relevant.  But there are concerns

1. What's with the stick - why punish companies for not achieving a sub-minimum.  The proliferation of BEE certificates in the economy shows how many companies are taking this BEE thing seriously. Many businesses cannot purchase from smaller businesses because they buy 90% of their products from a single supplier.  And if that supplier is improving on their own BEE scorecard then we are seeing progress.  
2. I have a huge concern about companies now having to become involved with their ED beneficiaries.  This is stupid and won't work - I don't care if it works in Asia. Here companies do what they do best which is run their own businesses - not helping other businesses.

Come on Rob, the ED principle has done wonders for so many businesses - why do you want to overhaul something that isn't broken, it just needs a little refinement which includes tax breaks and other types of incentives.  And also fire that useless Zungu, what the hell has he done for any business in South Africa - other than being a professional black.

Richard Ferrer just called me and asked if outsourced incubators and other types of ED facilitators are now going to be out of a job.  I don't think so - they will need to get closer to the companies who are paying them.  They'll also need to become the bridge between the two entities.  It'll take a little creativity but they will become more relevant than ever.

Minister revokes over 400 mineral rights

South Africa has found widespread violations during an audit of miners and other mineral rights holders in the country, Minerals Minister Susan Shabangu said on Monday.

"The moratorium on prospective rights has been lifted but in Mpumalanga these will only lifted in September," Shabangu said.

via www.businessday.co.za

IRBA and issuing BEE certificates - and an ABACUS warning

The IRBA published a notice last week.  They are telling their members (who wish to become verification agents) not to jump the gun too early.

registered auditors, other than those already accredited by SANAS as Verification Agencies, are not permitted to issue B-BBEE Rating Certificates until the dti has published the Code of Good Practice 005, duly signed by the Minister, and individual registered auditors have met the training requirements of the dti.

Underlining is my emphasis.  The DTI (I prefer uppercase) is taking this training thing very seriously.   And they should - I came across a certificate issued by ABACUS which is wrong, very wrong.  I won't upload the certificate to protect the client - but this company is a danger to anyone looking to get a certificate.  SANAS, when you have a look at them again, please contact me first and I'll tell you about that certificate.  In the meantime send this embarrassment off on training.

On the subject of SANAS' own BEE certificate (or lack thereof).  SANAS told me that they were very aware that they needed a BEE certificate but their problem was one of HOW?  Do they send out a tender to their accreditees to verify them.  In other words, how do you ensure that the certificate is independent?  However with the IRBA becoming the competing SANAS - they both can get independent certificates issued.  Problem solved.

A bit more on charters to come

Two articles caught my eye recently.  

ICT Charter - Let it die

After eight long years of toing and froing, the ICT sector will finally have clarity on how it should implement empowerment, as the long-awaited charter has been submitted for gazetting. However, this is not exactly good news.

Nicola Mawson postulates that the charter is going to cause more trouble than the problems it plans to solve.   One of the more relevant issues is the fact that ICT companies need to achieve a 30% ownership target.  She (correctly) observes

Legislation in the sector was meant to make things easier – not make it so hard for companies that transformation becomes a spiral of red tape, instead of a way to empower those who deserve to benefit. The charter will create a regulatory nightmare in its current form – and do nothing to redress the imbalances of the past. After almost eight years in the making, it's frankly defunct now anyway – the sector has moved on and done its own thing in accordance with the codes.

I really don't want to labour this blog with Levenstein (the content on this blog is far superior than anything his company has ever published), but the underlined section is very valid.  By labouring the charter point our hero is wreaking havoc with the whole process, you know, spanner in the works type of thing.  Oh yes, on that subject, I saw a Facebook comment from the same Incredible Skulk stating that he spends 30% of his time checking on BEE certificates to make sure that the companies aren't fronting (unlike his company of course).  Do you see the business model now?  Simple - reject a certificate and then phone the offending company telling then that their certificate is invalid.  And the rest is obvious; actually there is another revenue stream that no-one really knows about - if anyone has the Levenstein/Tempest email please can you post it in the comments below.  It makes for the most interesting reading and business model.

Back to Mawson

On top of which, the charter adds requirements to stipulations. If an ICT company wants to sell cellphones to a mine, for argument's sake, it will have to comply with the mining charter so the mine can gain procurement points. Ditto construction, financial services, tourism... the list goes on.

I've seen this problem.  I have a client out in Westonaria who was told by the mines that they have to comply with the mining charter's HDSA requirements if they want to do business with the mines.  In other words a BEE scorecard (correctly issued or whatever) is not good enough in that sector.   The fact that this is an untenable situation cannot be missed by the DTI (or can it).

AgriBEE target under fire

Not much going on here because the charter was gazetted under section 12 two years ago.

Johan Pienaar, the deputy executive director of AgriSA, said he was concerned about the lack of an overarching BEE charter in the sector. The government had gazetted the charter in 2006 (actually it was in March 2008), which should have been published as a code of good practice but had not.

And then he said

commercial white farmers had taken the initiative to assist black farmers in gaining market access, pointing out that organisations such as GrainSA and the Wool Growers Association in the Eastern Cape had contributed close to R200m towards AgriBEE-related initiatives.

You can read the contra arguments in the article.

And finally - or as my mate Grant says "ask me something about sport"

A transformation charter which will apply to all sports organisations is being drawn up

 Speaking in the National Assembly during the debate on his budget vote, Sport and Recreation Minister Fikile Mbalula said South Africa was still witnessing a sporting environment where there was a skewed picture of sporting facilities and opportunities.
"It is a responsibility of this government to fundamentally change the status quo, and ensure that South Africa has national teams and the amenities are a true reflection of South Africa's population," he said.

To ensure actions were focused and directed, SRSA (sport and recreation department) together with the stakeholders had started a process of drawing up a transformation charter which would apply to all sports organisations.

The speech the erstwhile ANKLE (ancyl) president made is full of great ANC rhetoric, words like national discourse, realisation of  priorities of national objectives, robust debates, engaged and mobilise.

Fikile - don't make the same mistakes that everyone has made.  Get a good charter drafted (which includes correct punctuation and spelling) and make sure that your administrators know what they are doing - otherwise it'll be a (insert your own expletive here), like all the others.  

Moratorium on mining licences set to be lifted on Monday

The eight-month moratorium on granting prospecting licences is expected to be lifted on Monday with the unveiling of an online application system expected to ensure transparency and reduce turnaround times

via www.iol.co.za

But has the DMR managed to shake off its corruption label?

Reporting fronting to the DTI as per the Guidelines on Fronting (etc)

Anybody had any experience in reporting fronting to the DTI. I know of a company that is very concerned about a high profile fronting case and wants to ensure that the DTI investigates it.

Please respond in the comments section.  We'd all love to know how to do it properly

Best line of defence is attack, just hope that your front is never exposed

Interestingly the codes themselves make no reference to fronting.  Fronting is discussed in a subsequent document (Guidelines on Complex Structures & Transactions, and Fronting  - Previously Statement 002).  Fronting is now provided with a proper definition

Fronting means a deliberate circumvention or attempted circumvention of the B-BBEE Act and the Codes. Fronting commonly involves reliance on data or claims of compliance based on misrepresentations of facts, whether made by the party claiming compliance or by any other person.

You'll notice from the definition that fronting can only be an intentional act, it cannot be by accident or mistake.  This is the reason why fraud can be included in this definition (definition taken from a MTN website).

In South Africa, fraud is defined as the unlawful and intentional misrepresentation which can lead to actual or potential disadvantage to another individual or group. The use of the term is in its widest possible meaning and is intended to include all aspects of economical crime and acts of dishonesty.

There's no shortage of definitions of fraud  in the Google world - feel free to check them up yourself.

Econoserv S A CC (2003/008557/23)

We have a situation with a certain Econoserv S A CC.  Most of you won't know who they are until you do a Google check on them.  If the internet is correct then it would almost be impossible to seperate Econobee from Econoserv S A, in certain cases Econobee is either a division of Econoserv S A, or trading as Econobee.  When we dig a little deeper into Econoserv we find out from this website that 

EconoServ is partly owned by Dinoka Investments - a majority black owned investment company which aims at investing and developing companies that work synergisticly together and have potential to grow.

They conveniently point us to the Dinoka website that states

Dinoka Investments is a majority black owned holding company that has shareholding in Econoserve (25.1%). It also offers consulting services in Enterprise Development and Human Resources.

This now tells us that Econoserve (with an extra e) is about 25.1% black owned.  If we use the modified flow through principle then it must be at least 25% black owned because of its majority black ownership, although this would not include black women ownership.   The Econoserve reference is in all likelihood a typo because there is no reference to Econoserve on CIPRO and the foot of the Dinoka webpage refers back to Econobee (I've uploaded a screenshot of the Dinoka website with this highlighted) 

Copyright © 2011 Dinoka - In association with EconoBEE Dinoka Enterprise Development- Training - EE - BEE- Business

What is also interesting is that this is not some sort of hangover from the past because the copyright notice is dated 2011, and this is the same with the Econoserve website that I referred to above. 

Copyright © 2011 EconoServ SA CC

See the screenshot here

There are now two different websites that bolster the black ownership of Econoserv S A CC.  To make sure that we are talking about the same company I then checked the co.za domain records for both econoserve.co.za and dinoka.co.za.

 Econoserve.co.za was first registered in August 2006.  The registrant is listed as 

2a_registrant          : EconoServ SA cc

2g_billingemail           : [email protected]

with the administrator as 

4a. admin                  : Levenstein, Keith

4b. admintitle             : CEO

4c. admincompany           : EconoServ SA cc

4g. adminemail             : [email protected]

Dinoka.co.za is quite similar, although registered a little later that year (November).  Again 

2a_registrant          : EconoServ SA cc

2g_billingemail           : [email protected]

with the administrator as 

4a. admin                  : Levenstein, Keith

4b. admintitle             : CEO

4c. admincompany           : EconoServ SA cc

4g. adminemail             : [email protected]

What does CIPRO say about Econoserv S A CC and who its members are?

You can never take a company's word for anything these days so I then went to look at the Econoserv SA CC CK documents.   There is NO black ownership!!! The two members of  the CC are

• KEIGH JULIAN LEVENSTEIN  (this is a typo because the ID number is the same as one Keith Julian Levenstein)
• HILARY LEVENSTEIN 

Each with a 50% "member size percentage".  For those of you who don't know who Hilary Levenstein is, you can see her on the Econobee website listed as one of the "Key Members of the EconoBEE Team".  She is Keith Levenstein's wife.

This is quite simply a GROSS MISREPRESENTATION OF ECONOSERV S A CC's OWNERSHIP STATUS  

What I don't know, but what is very easy to find out is whether this black ownership ever existed.  I have my doubts that it did - the most telling error is in the Dinoka website that tells us

 Dinoka Investments is a majority black owned holding company that has shareholding in Econoserve (25.1%)

Firstly a company, whether a CC, Pty (Ltd), or Ltd, cannot own a share in a CC, although a trust is able to own a CC.  I noticed this when the site first went live a few years ago.  My initial thought was that the CC had a trust attached to it as a shareholder - no such luck.

Secondly I could find no reference to Dinoka as a company on Cipro's records although I did find a shelf company with the same names on the Dinoka website as directors (along with a certain Christian Gouws).  This company,  SILVER MEADOW TRADING 165 (Pty) Ltd (2006/037473/07) is now deregistered.  

What exactly is Econoserv S A or Econobee's take on fronting?

If their dispactches on their website are anything to go by they are not in favour of it at all.  One blog post tells us that they have "won the battle against Fronting – the war continues!!!"  Another dispatch tells us about the consequences of using the wrong scorecard.  

EconoBEE began investigating this form of BEE fronting some months back when it discovered a corrolation between agencies participating in this devious activity and the fact that they had not yet been issued with an extension of scope to verify against those sector codes.

 And finally (although this is but a smattering of the many articles, blog posts and news articles that Econobee has published on the subject) one of their newsletters informs us that

 "Fronting is fraud"

What then to make of Econoserv S A's own black ownership misrepresentation.  To answer this I must return to the beginning of this post which defined fronting as 

a deliberate circumvention or attempted circumvention of the B-BBEE Act and the Codes. Fronting commonly involves reliance on data or claims of compliance based on misrepresentations of facts, whether made by the party claiming compliance or by any other person.

The ownership claims on these two websites cannot be regarded as some sort of mistake -

1. They weren't put there by accident.  They were put there by the websites' owners intentionally.  
2. The copyright on both websites is for 2011.  
3. There is a clear declaration of Econoserv S A CC's ownership, which includes Dinoka Investments.

In other words this must be regarded as a form of fronting, something that in my opinion is infinitely worse than a company using a DTI generic scorecard when a sector charter might apply.  

And so I must conclude with what Econobee wrote in the newsletter I referred to above, it seems that Econoserv S A CC (t/a EconoBEE) is possibly one of those 

companies (who) are gaining an unfair advantage over you, getting business they do not deserve to win.

And again, I will help Econobee 

speak out against crime, fraud and fronting.

by letting the South African public know that Econoserv S A CC/Econobee/EconoBEE is actively involved in such practices.

I'll let the reader decide whether this is fraud or not - it would seem that Econobee themselves would regard it as such.  Would you expect anything else from a company that courts controversy just for the sake of ................ courting controversy.  

A few notes

There was no shortage of concerned readers who helped me research this post.  Some not too far off the EconoBEE camp.  Thank you for your input.  Also please refer to the two screenshots I posted above if you have problems accessing these sites that point to the Econoserv S A black ownership. I also have emails from numerous people confirming that these two sites were live in April, 2011, these people sent me screenshots confirming the dates.  These are pages printed from both sites on the 12th of April, 2011.