Freedom From Poverty Bill: a radical shift or a false promise?

THE Freedom From Poverty Bill, introduced by the Institution of Race Relations (IRR) as a replacement for the Black Economic Empowerment (BEE) and the Employment Equity Act (EEA), has been met with mixed views.

- GCWALISILE KHANYILE

Under the bill, there is Economic Empowerment for the Disadvantaged (EED), which is codified as an alternative to BEE and a proposal for true transformation, as it will be based on need, not race.

It was launched this week as part of the #WhatSACanBe campaign in a webinar discussion between IRR Head of Policy, Dr Anthea Jeffery, and IRR Strategic Engagements Manager, Makone Maja.

The BEE aims to correct past inequalities and is governed by the Broad-Based Black Economic Empowerment Act.

Its application is limited to people who are black, of mixed race, and Indian, and excludes white people, including those with disabilities.

Explaining the difference between the two policies, Jeffery said the BEE uses race as a proxy for disadvantage, EED targets the poor, and identifies disadvantage based on a means test.

“This would enable poor whites to benefit too, but 99% of its benefits would in practice go to poor black people. Its nonracial focus would reduce racial divisions, put an end to race classification, and comply with the Constitution's founding value of non-racialism.

“The EED is voluntary, which means companies would no longer be required to keep the current BEE scorecard to aid them in state procurement contracts, or race-based ownership deals, management posts, and procurement contracts.

EED’s scorecard incentivises companies for their key contributions to the economy by rewarding them with EED points for these actions. With EED, the points cannot be redeemed to gain from preferential procurement,” Jeffery said.

She added that EED introduces education and health voucher-based support for poor people to be used at schools or health facilities of their choice.

This, she said, will redirect much of the revenue now spent on dysfunctional schools, hospitals, and housing developments into tax-funded vouchers for low-income families.