The Democratic Alliance (DA) has formally launched its legislative bid to repeal Black Economic Empowerment (BEE) from government procurement, replacing it with a new system it claims will empower all South Africans based on economic need rather than race.
The party’s Head of Policy, Mat Cuthbert, unveiled the party’s “Economic Inclusion for All” bill in a detailed interview, arguing that the existing BEE framework has failed the majority of South Africans and was originally designed to benefit a politically connected elite.
The announcement comes as the DA’s partner in the Government of National Unity (GNU), the African National Congress (ANC), is reportedly preparing to discuss revisions to the current form of BEE. Cuthbert confirmed the DA is open to these talks but stands by its proposal for a fundamental overhaul.
A System of “Exclusion” from the Start
Cuthbert made a striking historical claim about the origins of BEE, asserting its foundations were not built on genuine redress.
“The genesis of BEE particularly in the early ’90s was a group of big white businesses that sat in a room with ANC politicians and devised this particular system in order to be able to maintain the status quo,” Cuthbert stated.
He described this as a series of “share swaps” and ownership deals that benefited “ANC politically connected individuals,” a group he indicated included the current president. “The system from the outset was set up as a system of exclusion,” Cuthbert argued.
“Failed to Uplift the Vast Majority”
Defending the call for repeal, Cuthbert pointed to unemployment and poverty statistics, which he said have worsened for most South Africans despite three decades of BEE policy.
“We have 12 million in unemployment, 44 million South Africans trapped in poverty. This is not a tenable situation,” he said. He cited data showing the black unemployment rate increased by 10% from 2014 to 2024, while white unemployment decreased by 1%.
“Despite the ANC’s transformation policies, we failed to uplift the vast majority of South Africans who are black,” Cuthbert said.
The DA’s Alternative: The “Economic Inclusion for All” Bill
The proposed bill seeks to remove race as the primary criterion for government procurement preferences. Instead, it would give preference to companies that contribute to what the DA terms “valuable contributions to society.”
Cuthbert explained that 80% of a company’s evaluation for state contracts would remain based on the constitutional principles of being “cost competitive, equitable and fair.” The remaining 20% would be based on an “economic inclusion” scorecard.
This scorecard would award points for initiatives like job creation, skills development, investment in community infrastructure, feeding schemes, and early childhood development programs.
“Our policy itself would not exclude black South Africans but it would open to all South Africans who find themselves in a situation of poverty, unemployment and obviously locked out of opportunity,” Cuthbert said, emphasizing the party’s belief in “needs-based empowerment.”
Open to GNU Engagement
When challenged on whether the policy simply discarded a necessary tool for racial redress, Cuthbert insisted the DA believes in transformation and acknowledges historical injustices. However, he maintained the current system “locks in opportunity for a connected elite.”
He confirmed the DA is prepared to engage with its GNU partners, including the ANC, on the future of empowerment policy, noting “interesting developments” and leaks from ANC officials suggesting internal discussions on the matter.
The bill has been gazetted, marking the first step in the legislative process. Cuthbert expressed confidence in gathering public and cross-party support, stating the mood in the country has shifted and people are “tired of failed empowerment policies.”
