The open opportunity that comes with clean government
NEWS24 / 05 MAY 2019 - 15.03 / HERMAN MASHABA
It is one of my greatest aspirations for the people of Johannesburg that the vast enterprising potential of black entrepreneurs and businesses can be unshackled, writes Herman Mashaba.
On Friday this week, our council debated my State of the City Address. I was not shocked, unlike the president, when the ANC decided to attack the Inner City Rejuvenation that is underway in Johannesburg.
Johannesburg cityscape, taken at sunset, showing Hillbrow residential centre with the prominent Ponte flats and the communications tower.
What did surprise me was their line of attack. They claimed that I am closely linked to the companies that have been awarded this work, profiting from the exercise.
While that, frankly, doesn't warrant a response, I was left wondering how it is that anyone can oppose the work of rejuvenating the Inner City of Johannesburg.
Derelict buildings have been expropriated, handed over to the private sector and now R21bn worth of investment, with 11 000 construction sector jobs, will create over 6500 housing opportunities. All of this, without costing the ratepayer a cent. Who could oppose this?
I received my answer when I attended an event with the developers awarded the work of developing these buildings. The group comprised young, black, first time entrants into the market. All with impeccable credentials and strong financial backing from dependable institutions.
The sentiments that were consistently expressed by this group? We would never have bothered to tender for these projects in the past. The outcome was always pre-determined, a closed circuit of politically connected elite in the sector.
Under our multi-party government, efforts to clean up fraud and corruption, efforts to fix our supply chain processes, are affording new black-owned businesses opportunities that never took place before. Already, our procurement spend on small, medium and micro-enterprises is sitting at around 22%, from the 5% historically achieved.
This is because, for the first time, developers were awarded the work based on their BBBEE credentials, their ability to do the work, their financial backing, how many jobs that could create, how many units they could provide and the cost of the rentals they would charge. In departing from the past, there were no other secret criteria hashed out in dark corners in smoke-filled rooms.
In my engagements with these developers I was afforded a brief moment of optimism. This optimism stems from a belief that I had held in 1994 that our new found democracy would achieve an explosion of black entrepreneurship and business. That belief slowly dwindled over the years to the point that I realised that economic liberation was not high on the agenda for the ANC. Black-owned and operated businesses have suffered in our new democracy under the weight of corruption and tenderpreneurship.
However, this belief that I previously held, is starting to be given life in Johannesburg. For the first time in memory, unemployment is on the decline with 110 000 net new jobs being created in 2018, reducing unemployment by 1.1%. Our economic growth rate picked up from 1.4% to 1.7% in 2017/18, with new data expected soon. Our levels of facilitated investment rose from R4.5bn in 2016/17, an all-time high at the time, to R12bn for 2018/19 with one quarter still to go.
While these numbers are promising of a direction in which Johannesburg is heading in, it does not compare to the experience of meeting these developers awarded the work of rejuvenating the Inner City of Johannesburg. With the barriers of corruption and tenderpreneurship removed, these largely black-owned businesses now have won tenders that will grow their businesses, improve their standing in the sector and achieve the complete turnaround of the Inner City of Johannesburg.
Returning back to the ANC in Johannesburg, it starts to make sense why they would oppose this kind of thing. With our forensics teams having a case load of over 5 000 investigations, involving more than R25bn, corruption and tenderpreneurship was clearly an institutional culture under the ANC's governing of Johannesburg. These very same developers, now awarded the work of rejuvenating the Inner City, did not bother to apply. They knew they stood no prospect to compete with the tenderpreneurs who dominated the supply chain environment in Johannesburg.
Now that those who were the politically connected businesses of the past, are losing out on what has been a massive income stream from the City of Johannesburg, and not channelling money back to the ANC, their opposition to this project starts to gain clarity. In fact, I now take great pleasure in receiving the insults that arise from these politically corrupt interests being starved.
I stand behind the developers awarded the work of rejuvenating the Inner City of Johannesburg. I do so because they have won these opportunities in what is likely to be the first free and fair supply chain process of this magnitude from many, many years. However, I do so, particularly, because of what it represents to the lifting of the oppressive weight of corruption and tenderpreneurship that has throttled the explosion of black entrepreneurship and business in our country.
It is one of my greatest aspirations for the people of Johannesburg that the vast enterprising potential of black entrepreneurs and businesses can be unshackled to realise their potential to transform our economy in a way that it grows and creates the jobs that are so sorely needed.
This is my belief, and we are starting to see it happening.
- Mashaba is executive mayor of the City of Johannesburg.
Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER