THE mining industry is waiting apprehensively for the chairperson of the African National Cosa Nostra and sometimes minerals and petroleum Minister, Comrade Gwede, to gazette another round of BEE for the industry, by way of an amendment to the MPRD Act.
The new rules may require BEE for renewal of existing mining rights. For gees and in a move as constitutional as bringing back the Group Areas Act, Comrade Gwede simultaneously intends for the State to take control of movable tailings dumps.
The new BEE dispensation will be the fifth time that the rules will change since inception of the MPRD Act in 2004. There have been three mining charters, and the incoherent babble that is the 2009 Codes of Good Practice for the mining industry.
In a time when South Africa is suffering increasing joblessness and despair, even the Comrades must realise that more BEE is not going to create one extra job. Jobs carnage is looming warned Friday’s Business Day headline. So why do they pursue it? The answer my friend, is written on scraps of paper blowing in the wind outside Luthuli House.
The salivating Comrades remember when around 2004, mining bosses traipsed there to meet, amongst others, Mendi Msimang, the ANC Treasurer General, he would give them the names of their new BEE partners. I saw the list given to Aquarius Platinum, the first PGMs miner to convert all its old order mining rights. On the scrap of paper handed to “King Rat”* Stuart Murray (former CEO of Aquarius), appeared the late Zwelakhe Sisulu and one of Nelson Mandela’s daughters.
I recall a meeting at the DMR head office, when a demure Roeland van Kerckhoven, financial director of Angloplats, concluded an arranged marriage at the instance of the DDG Jacinto Rocha, with a consortium lead by mining engineer and former DMR official, Harold Motaung. Angloplats was promised long outstanding mining authorisations on the farms Twickenham and Hackney if a deal was done with the new suitors on the properties that eventually became the Atlatsa operation. Van Kerckhoven nodded and smiled weakly.
The chosen few would then team up with a white hand man, often an experienced former banker, who would help them navigate the complex and expediently hated capitalist world of corporate finance, tax and lending. Tokyo Sexwale had the brilliant but finally tragic Mark Wilcox, Ramaphosa had the geologist turned banker Rowan Smith, and the list goes on. The cash flowed and flowed for the political elite, who, I was told by a friend, tithed to Luthuli House.
Never again
But the Comrades and the job destroying machine that is the ANC, choose to ignore one simple fact – it will never happen again.
Mining BEE worked around 2004 for two reasons. Firstly, everybody bought into transformation in the mining industry, it had to happen. South Africa was in a good space; the Rainbow Nation was firing on all cylinders under the measured Thabo Mbeki. Everybody wanted to pour cash into the democratic miracle that South Africa was to the world. There was money and appetite for BEE.
Secondly, the trust deficit between the State and big business was encouragingly small. The first mining charter was negotiated and signed off by the DMR, the Chamber of Mines, NUM and others. The MPRD Act was gazetted in 2002 and only became effective two years later. Everybody knew what the baby looked like before it was born. There were no surprises.
But all that has changed dear Comrades. You have, through endemic corruption and neglect, destroyed the economy, the rule of law and the morality of the Constitution. The world no longer reveres us, they fear us as we march and march against ourselves in the streets. Mining fixed domestic investment has left our shores and billions of dollars have moved to South America and elsewhere.
End the self-serving obsession with BEE, arrest the crime rate and the money will come back. Then we can create jobs and improve the predominantly miserable lives of communities in resourced areas. But the Comrades don’t prioritise that because in a nutshell, they couldn’t care less. It is time for the mining industry to draw a line in the sand and collectively say to them, “Enough”.
(Disclaimer: no middle-aged white men or Comrades were injured in the writing of this article).
* So named because he was the largest company of the “rats and mice” in the platinum group metals sector.
Hulme Scholes is a partner at law firm MalanScholes.
