Paul Janisch

bobby the brave, the bolshevik remains

What to do?  My last post which was published on Biznews this morning.  In this article I reverted back to type and poured out my usual anti-davies vitriol, all of which hoped that Rob Davies (uppercase because of search engines) would have declined the post of minster of trade and industry. This was based on his declining a position on the ANC's NEC's in December.   But there was wishful thinking here.  I have made no secret of the fact that I think he was useless at the job.  His policies are not designed to build an inclusive economy - they were designed to redistribute, not to build.  I was initially very optimistic about him.  Here's the post I wrote when he was appointed minister

With the Zumocracy (hopefully not a zoomocracy) comes a new cabinet and new minister of trade and industry.  A notice from the Presidency's website contains the list of new ministers and their deputies.  The one we BEE-types are most concerned about is the new minister and his deputies.  

Rob my man - you have a hell of a job on your hands.  I am only aware of the mess that is BEE, but I am almost willing to bet that the rest of the department is in a similar state.   I was sent an SMS on Thursday informing me that the outgoing (and apparently pissed-off) minister had gazetted the construction sector charter under section 9.  The sender remarked that said (now ex) minister was trying to push a series of things through to make his successor's life a misery.

 

I gave our bolshie a go.  But it became very clear in a very short time that he was out of his league.  There was the business registration proposal that said every business, from the broom seller through to the major conglomerate, had to register with the local municipality and acquire a licence (something along these lines).  That seems to have fallen by the wayside, but it's one of many hamfisted programmes that he and his ministry launched in a half-baked fashion.

Yet he is still the minister.  The optimist in me wants to think that everything he did was under the aegis of the wannabe fascist zuma and that we might see a change in his myopia.  Perhaps this quote is an indication of a more realistic approach towards the empowerment process

Trade and Industry Minister Rob Davies said equity equivalents was a facility available under the Broad-based Black Economic Empowerment (B-BBEE) Act, and they could apply.

“We are not unrealistic about what we expect in terms of the B-BBEE scorecards. We want to see a progression and incremental progress.

“We are not going to be asking for something ridiculous and the moon,” he said on the sidelines of the official launch of Isuzu Motors South Africa in Port Elizabeth last week.

The underlined quote is important.  As I wrote last week - how are you going to see an improvement if you won't allow companies to get on the scorecard in the first place?  He's right here - the revised codes were implemented because people like me found ways to get around them and scores were fantastic.  bolshie took one look at this and under very one-sided advice  concluded that transformation is lagging behind.  What do you do?  You do exactly what Brigadier Jakes Swart did on Christmas day 1986, you force transformation on the people.  This is what the revised codes were about - they were an attempt to get companies to make a better plan at transforming.  The idea is noble, even if the targets  were completely off the mark.  The problem lay in the fact that the SOEs and the larger corporates were not going to tolerate a drop in score because it impacts (in the case of the private sector) on their BEE score.  I can understand why the bee commissioner (awesome awdoz) is getting pissed off with bigger companies hitting ridiculously high scores at the outset - great score but where's the change?

This is a risk we face here - if we shoot out the lights with these codes they are just going to change them again and make them even harder.  This is a strategy that a communist understands well.

Back to bolshie - I'm hoping I'm right. I'm hoping that his quote above is an indication of his long term attitude and strategy. If I am then his name will change on this blog.

Related articles

Cyril Ramaphosa Sworn in As The New President of South Africa - ClassicalPromo

Where does our favourite empowerment system fit in with Cyril's economy rebuilding programme?

Where does our favourite empowerment system fit in with Cyril's economy rebuilding programme?

Disclaimer: please excuse the uppercase usage for zuma, gigaba (abagig to this blog), davies (should be bolshie bob) and dud miyeni (in the land of sheer incompetence this one truly stands out, we are talking mkhwebane incompetent).

It’s been almost a week since Cyril’s SONA and our initial euphoria has been tempered by Gigaba’s reality biting budget speech.  It’s now patently clear that Zuma’s gallant attempt at destroying the economy was remarkably successful. That might be a little too lenient on the erstwhile statesmen. His lack of leadership has left the fiscus, the economy, the government and the country in complete turmoil. No amount of litigation and Zuma/Gupta dock-sitting is going to make this pain any more bearable. Cyril also has to live with the fact that the last nine years have created a massive trust deficit between the public and the government. Cyril’s words at the SONA were comforting and probably lulled us all into a temporary false sense of security.  But reality bites hard and we are unlikely to take his word at face value.  We want action. Zuma made all sorts of promises in his SONAs but it was only those that served the interests of his kleptocracy that were honoured.  Think about procurement set-asides that Dud Miyeni illegally imposed at SAA.

In spite of my cynicism I do recognize the importance of resuscitating the economy.  We can’t run away from this.  The imperative to create employment cannot be overstated. Social interventions like black economic empowerment (BEE) have to play a greater role in this process than they ever have before.  But they cannot deliver on this imperative in their current guise. If you consider the Gigaba has raised taxes and reduced the disposable income of most corporates, and taxpayers, there is now less money for extravagant BEE programmes.  Davies’ Marxist-inspired altruistic BEE codes are in severe danger of collapsing in on themselves. 

It’s been 3 and a half years since Davies gazetted his latest set of BEE codes. In that time he has also overseen the gazetting of numerous industry specific charters, culminating in the financial sector code in December 2017. This must have felt like a coup to him because he got it done in three years, three times faster than the previous one took to gazette. Over the last three years I have seen a number of companies simply falling off the BEE radar. Of the 100-odd qualifying small enterprises (QSEs – turnover between R10m and R50m) that I have assisted in the past decade, only one has attempted to be rated under the new codes.  The balance have either opted for non-compliance or simply restructured their shareholding to appear to be 51%black owned. The sole compliance company has gone to great expense and has come out in a far worse position than the effort was worth. A number of larger companies (turnover in excess of R50m) have simply requested their verification agency to give them a non-compliant BEE certificate. Not your average non-compliance certificate, one with five zeros on it. The reasoning behind this is simple, under Davies deluded regime if you have 54.99 points or zero you are still non-compliant. Why go to the extraordinary effort and expense to get to 54.99 points when the result is exactly the same as zero. I can only assume that the market is accepting these BEE certificates because I’ve heard of very little pushback.

These companies have fallen off the BEE map and with it their enterprise and supplier development as well as socio economic contributions. They are still skilling up their staff because being in business requires it and they are still attempting to meet their employment equity commitments. There is no incentive to go back onto the BEE map because they have chosen to exercise their constitutional right to retain 100% ownership of their businesses – something that would be regarded as racist…… Because of this simple omission they will make no contribution to emerging black businesses or charities. I’m sure Davies and his cabal of Marxist and militant employees are hatching all sorts of plans to punish these companies even further because of this. But this will be to no avail. They are lost to the system and it will be nigh on impossible to get them back.

What we need now are friendlier policies that encourage compliance, not policies that presume that all corporates are inherently racist and anti-transformation.  These policies need to encourage and reward transformation, unlike the current system that punishes. Most importantly it needs to embrace every company that is able to contribute, Davies’ head-in-the-clouds system exempts companies who are more than 51% black owned and turn over less than R50m from even bothering to contribute to the empowerment process.

What if Cyril took a different approach.  What if he appointed a minister of trade and industry who saw black economic empowerment in its correct context; a context which recognises BEE’s contribution to nation building and restoring the economy. He wouldn’t have to do too much here. He cannot change the BEE codes wholesale because it will show that ANC policies are not workable.  The business community would be hard pressed to swallow another change in the ANC’s transformation policy. All Cyril would need to do is remove the priority elements requirement.  These are the elements, like ownership,  that must be complied with.  A failure to do so results in the company dropping a level.  He should also reduce the points levels to those of the earlier versions of the BEE codes.  It would also help if SANAS were told to drop their ridiculous levels of compliance checking and start giving companies the benefit of the doubt. But this might be too tall an ask for now.  This gesture would be a small step in rebuilding the trust that the zuma years have categorically destroyed and would bring those companies that have fallen off the radar back into the fold.

Business wants this country to succeed and is willing to play a significant role in this process, but it also needs to be shown that its efforts are making that contribution and that it is being acknowledged. Awarding BEE points for efforts that achieve these goals will make a major difference to the corporate lives of those contributing to employment and growth.

Will we miss him

Nodderfok. Useless arsehole that he was and continues to be. Now I listen to Jessie Doosart telling a public that detests both equally how great zuma was.

He wasn’t