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COSATU is worried that BEE is under threat after the National Treasury’s “gutting decision” regarding the government's Preferential Procurement Regulations.
This, the trade union federation said, would mean the abolishment of any measures to support local procurement and broad-based black economic empowerment (BBBEE).
"This is an unmitigated disaster and a giant step backwards for South Africa’s painstaking efforts to support localisation and BBBEE since 1994. All properly adjusted persons can see South Africa remains scarred by nearly 350 years of colonialism and apartheid," said a statement by the union.
Cosastu said that a majority of the wealth is still in white male hands, noting that South Africa was an unequal society and that it was unsustainable where poverty and race are symbiotic at all levels. The union called this a time bomb waiting to explode.
"Local procurement is key to sustaining and creating badly needed local jobs, from manufacturing to agriculture. BBBEE is key to shifting ownership to reflect our demographic diversity and to empowering the disadvantaged. The 2011 and 2017 Preferential Procurement Regulations were explicit in the need for all national and provincial government departments, municipalities, entities, and state-owned enterprises to support locally produced goods and BBBEE," added the statement.
Referring to the Constitution, Cosatu added that government at all levels should pursue legal, social, and economic measures to address the legacies and inequities of the past and present.
"The BBBEE Act follows suit. The sectoral master plans are premised on supporting local procurement and BBBEE. The Public Procurement Bill that will soon be tabled at Parliament compels all state organs to do likewise," added the trade union organisation.
According to Cosatu, public procurement stood at R1 trillion per annum and is the largest source of stimulus in the economy, which it says plays a huge role in supporting local companies and BBBEE.
It said there were countless successful industrial economies around the world that have effectively supported similar measures aimed at creating and sustaining local jobs and businesses and empowering historically disadvantaged communities.
"It boggles the mind why Treasury has now wilted at the hands of Sakeliga, an obscure right-wing organisation, and abandoned the very principles of transformation and localisation that the majority of the nation has embraced and voted for since 1994.
“By removing any requirements for state organs to support local procurement or BBBEE, the government will be powerless to intervene when these state organs simply choose to import goods that can be locally produced or refuse to support emerging entrepreneurs," continued the statement.
Cosatu said the Presidency needed to intervene and instruct Treasury to withdraw this inexplicable gutting of the Preferential Procurement Regulations and reinsert the previous commitments to support local procurement and BBBEE.
"Cosatu will be seeking an urgent meeting with the Ministers for Finance and Trade, Industry, and Competition to ensure that sanity prevails," said Cosatu.