ECONOMY-SOUTH AFRICA: Affirmative Action — the Only Way Forward?

By IPS Correspondents Reprint | | Print |

Gumisai Mutume

JOHANNESBURG, May 20 1998 (IPS) - A question being increasingly asked in academic circles here is whether South Africa is rushing down a road that has caused some amount of controversy in the United States in recent years: that of affirmative action.

At the heart of the debate is a proposed Employment Equity Bill. Soon to be legislated in South Africa, it will compel private companies to employ at least 75 percent Blacks, 50 percent women and 5 percent disabled people.

The mainly white opposition parties in South Africa see it as ‘reverse racism’ but the ruling African National Congress (ANC) says it is the only way to deal with centuries of discriminatory policies and affirmative action that has brought Afrikaner males to the top of the economic ladder.

Across the Atlantic in the United States, affirmative action remains a much discussed subject, with some singing its praises while others have reservations about its merits. “There is no one view on affirmative action among African Americans,” says Ronald Gault, managing director of JP Morgan, a firm of investment bankers. ‘Many of us Blacks and Whites are looking at ways to refine and redefine affirmative action.”

“Many of us are realising that promoting diversity promotes good business,” adds Gault, himself an African-American working in South Africa. “Is this an answer for everyone?”

South Africa is taking a cue from the successes and shortcomings of affirmative action policies in the United States as it moves away from a society largely dominated by Whites.

When it becomes law sometime this year, the Employment Equity Bill will require anyone who employs 50 people or more to monitor his/her workforce by race, gender and disability, identify any under-representation and make reasonable progress in achieving employment equity within five years.

The bill will empower the state to impose fines of up to 100,000 U.S. dollars in the first year on employers who do not comply with it. The penalty becomes 120,000 dollars in year two, increasing progressively up to 185,000 in the fifth year.

Another deterrent is that the award of government tenders will also depend on whether a company has an employment equity plan.

“Affirmative action is the route towards employment equity — a situation where there is no discrimination on the labour market,” says Guy Mhone, director in the Department of Labour. But, he adds, “the current bill only deals with affirmative action in the labour market.

“It is not a policy of total social transformation. It is therefore inadequate to deal with the problems at hand,” explains Mhone, who argues that affirmative action is a must, but has to be accompanied by broader policy proposals to deal with unequal access to land, assets, finance, human resource development, broken families, education and training.

Blacks constitute 76 percent of South Africa’s 37.9 million people while Whites are 12 percent, but about 95 out of every 100 poor South Africans are Black. The average White earns more than nine times the income of the average Black. And the unemployment rates are four percent for Whites as against more than 40 percent among Blacks.

These are just a few examples of the disparities that the ruling African National Congress (ANC) seeks to redress through affirmative action policies.

“The sheer number of poor people in South Africa is shocking,” says Jeffrey Humber, chief executive of the securities firm Merril Lynch. “The requirements of equity become harder to make work when you are dealing with a majority. But I don’t know a better way to do it other than affirmative action.”

Humber, also an African American, says one variable that needs to be considered is whether America and South Africa are comparable? “The answer is yes and no,” he feels.

Both countries suffered from government-supported racial divisions. However these ended at different points — with a relatively large middle class in America and a small one in South Africa. Blacks in America are a minority in a very rich country whereas in South Africa they are a majority in a nation whose economy is stagnant.

Whites are increasingly feeling pressured. ‘Are white males an endangered species?’ is a question often heard as fears of Whites being replaced by Blacks grow. On the other hand, proponents of affirmative action stress that it isn’t just about race.

“We are not saying being black should be the be-all and end- all,” says Jimmy Manyi of South Africa’s Black Management Forum. “We are putting competence as well as a criteria for affirmation.”

Some critics of the Employment Equity bill say it’s because general elections are due next year that the ANC — not having done much for black economic empowerment — is now in a hurry to ensure the corporate workforce mirrors national and regional demographics.