Parties join fray against BEE fronting

Business fronting and Broad-based Black Economic Empowerment (B-BBEE) fraud has come under serious scrutiny as many white-owned businesses are being exposed for using black people as proxies to get tenders.

Based on this, many political parties have also entered the fray, questioning the modus operandi of big companies such as Sasol, which is also a transgressor when it comes to turning a blind eye to fraud and fronting.

Sunday World has been running a series of stories about one company, NJM which was also investigated by Sasol and later found guilty of committing fraud on its claims it was compliant when it came to BEE.

This week, another company, TW Civils, was also flagged by investigators of Sasol, however, the chemical giant turned a blind eye to the findings and allowed the contractor to continue its work, despite serious revelations that it was using black people as fronts, while having an expired BEE certificate. Xiluva leader Bongani Baloyi said B-BBEE should be replaced with broad transformation and economic inclusion.

“It is evident that B-BBEE has completely failed and has not achieved its intended goals to address the historical economic imbalances caused by apartheid and encourage the transformation of the South African economy. This has led to a growing disillusionment and frustration within the black community, as they feel that the promises of transformation and empowerment have not been fulfilled,” said Baloyi.

He also stated there is a need for genuine transformation, where black people are truly empowered and have equal opportunities to succeed.

“It is time for a fundamental shift in mindset and action, where black people are no longer seen as a means to an end and be used as pawns in white-owned companies through fronting but as valuable and respected contributors to society.

“Only then can we truly promote economic growth and development that is inclusive and sustainable for all. As such, it is necessary to replace B-BBEE with a more effective and inclusive approach such as broad transformation and economic inclusion to ensure genuine empowerment and equal opportunities for all individuals,” said Baloyi.

When asked about its take on BEE fraud committed by white-owned companies at Sasol, DA’s spokesperson in energy Kevin Mileham said he and his party were not going to be dragged into the matter.

“Sasol is privately owned, and it is not a state-owned entity. The company is listed on the stock exchange,” said Mileham.

When he was told the government has shares in Sasol, Mileham retorted: “It’s a minority shareholding. I’m not prepared to comment on this, please contact Sasol for commentary.”

However, ActionSA president Herman Mashaba lashed out at the ANC for the failed B-BBEE.

“This is the reason why ActionSA is of the view that this failed ANC B-BBEE has to be scrapped.

“Why government is not doing anything about it is because of ANC bigwigs being shareholders in these companies.

“Our recent policy conference called for inclusive economic empowerment to benefit ordinary black, coloured and Asians previously excluded from economic participation.

“All businesses will contribute to the Opportunity Fund for 30 years, with these funds we will build schools, health facilities and finance black businesses at favourable rates,” said Mashaba.

IFP acting spokesperson Liezl Van der Merwe said: “Fronting not only “frustrates the achievement of the objective(s)” envisaged by the B-BBEE Act, but it is also a type of fraud, and therefore illegal.

“The IFP is against any form of fronting, and in full support of the fines and penalties imposed through the act.”

BOSA leader Mmusi Maimane said: “We are opposed to all forms of corruption and exploitation, regardless of who the perpetrators are and how it is conceived and carried out. BOSA is committed to economic growth that is diverse, rapid, ambitious and inclusive.

“We hope that all investigations into such forms of corruption and corner cutting bear out the reality and the perpetrators are prosecuted”.

He added: “Our party thrives to build a collective narrative and we believe that demographics can and will cause polarisation. Transformation avoidance and evasion undermine the development objectives of the country, and should be condemned.”

Mbalula did not respond to our request for comment.

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