Mining still way off old charter’s goal

Much of our time is spent fighting over that with which we are now saddled — and little or none on how to make it work better and for more people.

The new Mining Charter has herded both sides of the argument into their traditional laagers. The industry and its supporters complain the government is forcing changes in racial ownership and management that will kill investment while benefiting a select few. The government and its supporters say whites will hog the industry unless they are forced to give way.

In a sense, both are right. Mining is still way off the goal spelt out in the previous charter: an industry that “draws on the human and financial resources of all SA’s people”. But the new charter’s approach — imposing a set of arbitrary numbers — will not solve the problem because it ignores the need to negotiate change. The conflict is a dispute between insiders about how to share out what the country has, not a discussion about how to change it.

The core fight is about the size of the minority black shareholding in the industry. This does not necessarily entail any change to whose “human resources” contribute to running the mines. Its likeliest result will be that black people acquire a bigger chunk of businesses but no greater role in running them.

This is ideal for the ANC patronage faction, which is interested in access to money, not managing companies. But it brings no closer what the first charter thought SA needed: that black people play a growing role in running mining companies.

Black economic empowerment (BEE) has been obsessed with ownership, not who makes decisions in companies: BEE programmes do not seem to be much interested in how to ensure that more black people and women gain a role in actually running companies.

In theory, this charter does care about who runs companies because it has wildly ambitious targets for black and women board members and managers. But it is telling that, although these changes would disrupt companies more than the share provisions, they have been largely ignored in the companies’ reaction. This suggests mining companies know these targets are not serious intentions.

One feature of racial change in business has been filling black management quotas by appointing people to positions that require talking to the government, bargaining with unions or public relations, not operational tasks. Just as BEE is not fussed much about whether black share owners play a role in running companies, employment equity does not care much whether the people who fill up management quotas do any managing.

The mining dispute is therefore essentially about which insider group — the economically connected owners or the politically connected aspirants — should get what share of an industry that is still not enriched by the skills of those who have always been excluded.

Many other economic policy disputes between “right” and “left” in society are arguments between insiders on how to share out that which is off limits for much of the country.

The charter debate does not ask whether any thinking needs to change if they are to fulfil the second goal of the original document, to “offer real benefits to all South Africans”. Because of its past role as a source of great wealth and a symbol of white economic power, fights over the mines assume they remain a potential source of bounty to many people. This ignores the reality that the days in which mines were mass employers are over. Whether SA ends up with an industry in which companies do as they please or one in which they are bound by strict quotas (or anything in between), the mines will never again offer jobs to hundreds of thousands.

This is a crisis for parts of the country that are built around mine employment. It can be averted only by finding ways in which mining companies, working with the government and other key interests, can contribute to opportunities for people who will no longer be employed by mines, ensuring that fewer jobs do not also mean fewer livelihoods.

Some of this thinking lay behind the social plans that were part of the first charter; they called for companies to play a role in tackling the social costs of job losses. But not much has come of them because business, labour and the government still assume, despite glaring evidence to the contrary, the industry will somehow provide and there is no need to think beyond it.

As long as that continues, fights about the mines will continue to be about how what works for a few is divided up, not how to make it work for many more.

BECAUSE OF ITS PAST ROLE AS A SOURCE OF GREAT WEALTH, FIGHTS OVER THE MINES ASSUME THEY REMAIN A POTENTIAL SOURCE OF BOUNTY TO MANY PEOPLE