Afriforum launches another suit against government over BEE

AfriForum is again taking legal action against government – this time the Department of Small Business Development over the application of BEE requirements in providing relief to enterprises seeking assistance due to the COVID-19 pandemic.

This is similar to a prior case the lobby group brought against the Department of Tourism, together with trade union Solidarity.

Both parties had approached the North Gauteng High Court in Pretoria in a bid to have the department’s empowerment-based criteria for businesses seeking government assistance in the wake of the coronavirus, declared unlawful.

The department, led by Minister Mmamoloko Kubayi-Ngubane has allocated R200 million for the tourism industry, which has been one of the hardest hit sectors, as a result of the global pandemic.

The court ruled in favour of the department and the lobby group and union intend taking the matter up with the Constitutional Court.

The Minister is being dishonest and promoting a “racial agenda”

AfriForum’s latest action comes after Minister Khumbudzo Ntshavheni stated in a parliamentary meeting that they would be applying BEE requirements upon considering relief applications.

The lobby group has accused Ntshavheni of not being truthful by contradicting an earlier Afriforum statement in March, in which it was said that BEE codes would indeed be applied.

“As if it is not unethical enough that government is even in this time of crisis promoting a racial agenda, the situation is being worsened by the Minister’s deliberate misrepresentations”, said CEO Kallie Kriel.

According to Kriel, the minister’s dishonesty is being exacerbated by her Department even being willing to, in court papers that were signed under oath, undertake to Solidarity that they would not continue with the use of racial criteria when relief is provided to enterprises.

“AfriForum will take this matter to the highest court to ensure that justice is done”

Relief funds may soon be exhausted

Government set aside R530 million for her department’s small business relief scheme, however the funds are running dry and there are talks with National Treasury to avail more money, to support businesses which have been severely impacted by the COVID-19 outbreak.

“Our pot or kitty is too small,” she said. “We are working with National Treasury to make sure more money in the scheme is available”, Khumbudzo said. She appeared in an online meeting with MPs on Tuesday, 28 April, 2020.

The minister said thus far 665 businesses had benefited from the department’s debt relief scheme, resulting in the preservation of about 10 000 jobs. Four small businesses had benefited from the growth and resilience scheme.