In the next three weeks, expect posts (time depending) on the EU, India, Colombia, Ukraine and Belgium. I am still welcoming any contributions from readers who wish to help out with the coverage of this avalanche of elections by submitting guest posts.

National and provincial legislative elections were held in South Africa on May 7, 2014. All 400 members of the National Assembly, the lower house of the Parliament of South Africa, and all members of South Africa’s nine provincial legislatures (a total of 430 seats) were up for reelection.

This post on the South African election is my longest one yet – it is meant to complete the relevant sections of my incomplete pre-election Guide. Good reading!

Electoral system

I covered South Africa’s political system in extensive detail in the first section of my (unfortunately) incomplete Guide, with details on the electoral system and constitutional framework.

South Africa’s system of government may be defined as being a parliamentary system, but it has elements which make it a hybrid between a parliamentary and presidential system.

The National Assembly, the lower house, is made up of 400 directly-elected MPs who serve a five-year term and are elected by closed-list proportional representation. Voters cast a vote for a party in the national election, but the allocation process once votes have been cast is fairly complex. In theory, half of the seats are filled from regional lists and the other half is filled from a party’s national list, although parties are under no obligation to submit both regional lists and a national list. In the first stage of allocation, the seats in each province are apportioned according to the largest remainder method. In each region (province), a quota of votes per seat is determined by dividing the total number of votes cast in the region by the number of regional seats, plus one (the Electoral Commission determines the number of seats allocated to each province before the election). The result plus one, disregarding fractions, becomes the quota of votes per seat for the region. To determine how many seats each party will receive in the region, its total number of votes is divided by the quota of votes per seat. This will produce a whole number, which is the number of seats initially allocated to the party, and a surplus. Once this calculation is performed, the sum of allocated seats is obtained. If this total is smaller than the number of regional seats, unallocated seats are awarded to the parties according to the descending order of their remainders. The seat distributions from all provinces are aggregated at the national level, to obtain the number of regional list seats allocated to each party.

The second stage begins with the proportional distribution of all 400 seats in the National Assembly. A quota of votes per seat is again determined by dividing the total number of votes cast across the nation by the number of seats in the National Assembly, plus one. The result plus one, disregarding fractions, becomes the quota of votes per seat. To determine the number of seats each party will receive, its total number of votes is divided by the quota of votes per seat. This will produce a whole number, which is the number of seats initially allocated to the party, and a surplus. Once this calculation is performed for all parties, the sum of allocated seats is obtained. If this total is smaller than the number of seats in the National Assembly, unallocated seats are awarded to the parties according to the descending order of their remainders, up to a maximum of five seats. Any remaining seats are awarded to the parties following the descending order of their average number of votes per allocated seats.

The regional list seats are then subtracted from the total number of seats allocated to that party’s list, and the remaining seats are filled by the candidates on the national list in the order determined before the election. In the event a party does not present a national list, the seats allocated to it at the national level are filled from its regional lists.

The upper house, the National Council of Provinces (NCOP), is made up of 90 members, with each of South Africa’s nine provinces sending a single delegation made up of ten members. Six of the ten delegates are ‘permanent delegates’, serving for the duration of the legislature and elected by the provincial legislatures, proportionally in accordance to the strength of the parties represented in the provincial legislature. The other four delegates are ‘special delegates’ – the provincial Premier, and three other special delegates elected by the provincial legislature, again proportionally to each party’s strength. The special delegates rotate based on the matter being discussed by the NCOP. According to the Constitution, while the National Assembly “is elected to represent the people and to ensure government by the people” (Section 42.3), the NCOP represents the provinces, “to ensure that provincial interests are taken into account in the national sphere of government” (Section 42.4).

Except where the Constitution provides otherwise, the NCOP’s members vote as delegations, with each province having one vote and the vote is carried with five provinces voting in favour. Legally, a delegation must vote in accordance with a mandate approved by the provincial legislature it represents. On ordinary bills not affecting the provinces, the NCOP votes individually, each delegate having one vote.

The National Assembly has full legislative powers on most matters, and its members as well as Ministers and Deputy Ministers, may introduce any piece of legislation. The NCOP considers ordinary bills not affecting the provinces and it may approve it, amend it or reject it but the National Assembly can pass the bill again with a regular majority. The NCOP has significant power on legislation affecting the provinces (Section 76 bills), with the power to introduce a certain category of such legislation (Section 76.3 bills) and it must approve all Section 76 bills. If there is a disagreement on a Section 76 bill, it is sent to a Mediation Committee which then produces a compromise bill which is sent to both houses; if that bill has originated in the National Assembly, the National Assembly has the power to override NCOP opposition and the Mediation Committee (but with a two-thirds majority). The NCOP must also approve some constitutional amendments (amendments to Chapter 1, the Bill of Rights or any amendment dealing with the NCOP or provinces), in such cases, the amendment requires a two-thirds majority in the National Assembly (three-fourths for amendments to Chapter 1) and the support of six out of nine provinces in the NCOP.

The President of South Africa is the head of state and government and is elected by the members of the National Assembly at its first sitting. The President may not serve more than two terms, and he may be removed from office with a two-thirds majority of the National Assembly (for ‘a serious violation of the Constitution or the law’, ‘serious misconduct’ and ‘inability to perform the functions of office’). The National Assembly may pass, with a regular majority, a motion of no confidence in the President. If carried, the entire cabinet and the President must resign. The President assents to and signs bills, refers bills to the National Assembly for reconsideration (if he/she so chooses) and chooses members of the cabinet.

South Africa has nine provinces with significant devolved powers and their own provincial legislatures and Premier, a framework similar to that of the national government (except that legislatures are unicameral). The provincial legislatures, which consist of between 30 and 80 members – the exact number of seats, except for the Western Cape, is set by the IEC based on provincial populations, are elected by closed-list proportional representation (largest remainder method). The provincial Premier is elected by the provincial legislature, and appoints a cabinet (Executive Council). Concurrent powers shared between both levels of government include, among others, agriculture, environment, health services, housing, public transport, tourism and trade. Exclusive provincial powers include local archives, libraries, museums, provincial planning, provincial cultural matters and provincial roads and traffic. The provincial executives are responsible for implementing provincial and appropriate national legislation, administering national legislation, developing and implementing provincial policy and preparing and initiating provincial legislation. The national Parliament, may, however, under certain circumstances, intervene in exclusive provincial powers.

Registration and voting is voluntary. All South African citizens over the age of 16 with a valid identity document may register to vote, although only registered voters above the age of 18 are eligible to vote. Elections for all levels of government are managed by the Electoral Commission of South Africa (IEC), a chapter nine independent state institution.

20 years of democracy (and ANC rule)

South Africa’s 2014 general election, the fifth since 1994, is a landmark election in the country’s young democracy. 2014 marks the twentieth anniversary of multi-racial democracy – the first free elections open to all races were held on April 27, 1994. 2014 is the first election in which the “born-free” generation – young South Africans born after the end of apartheid (1994) – are eligible to vote. 2014 is the first election to be held after the death, in December 2013, of South Africa’s first black President, the legendary Nelson Mandela.

Since 1994, South Africa has been a one-party dominant system ruled by the African National Congress (ANC), the historic liberation movement. The ANC has won every election since 1994 with over 62% of the vote, peaking at 69.7% in 2004 and winning 65.9% in the most recent election, in 2009. The ANC also governs eight of South Africa’s nine provinces and all of the country’s major cities, except for Cape Town.

Much can be said – good and bad – about the ANC’s record in the last twenty years, and a lot depends on one’s perspective. It is important to recognize both the good and the bad which has come with 20 years of ANC rule in South Africa.

South Africa is now a liberal democracy, with a constitution which is often said to be one of the most progressive constitutions in the world – especially thanks to its Bill of Rights. Although two decades of ANC rule have eroded the independence of independent institutions and has hampered Parliament’s constitutional mandate to hold the government accountable to the people, South Africa remains an electoral democracy with free and fair regular elections. Despite cases of judicial and political misconduct, South Africa’s judiciary remains independents and the courts have rendered judgements against the government or its policies. Even if impunity for corruption remains a huge problem, a number of politicians – including members of the ANC – have been convicted and served prison time for corruption. Since 1994, the courts’ interpretation of the Bill of Rights have resulted in landmark judicial decisions, which notably abolished capital punishment (1995), upheld the country’s liberal abortion laws (1998) and ordered the legalization of same-sex marriage (2005). The Constitution guarantees a wide range of freedoms, including the freedom of speech, assembly, freedom and security of the person and conscience; these rights are generally respected and protected in practice. Although the public broadcaster, the SABC, is often accussed of being biased in favour of the ANC, South Africa has a large array of private media sources which may often be critical of the government and investigate corruption scandals. The country has a vibrant civil society with a large number of NGOs and community organizations which can be influential on government policy.

Above all, institutionalized racism is a thing of the past. All South Africans – regardless of their race/ethnicity - have the right to vote, live and work wherever they wish, move freely across the country, love and marry who they want, engage in political activities unimpeded, protest the government within the limits of the law and are equal before and under the law. Races mix and intermingle freely, especially in the middle-class suburbs of urban centres.It is a lasting and significant achievement, whose importance should not be downplayed. Nevertheless, twenty years is a short period of time to erase the legacy of hundreds of years of segregation and racism from popular culture, individual mindsets, society, the economy and politics. Racial antagonisms, stereotypes or misconceptions remain deeply rooted in individual mindsets, meaning that the slogan of a ‘rainbow nation’ remains far more of a dream than a reality.

It is clear that poverty, inequality, unemployment and high criminality remain huge and daunting challenges for South Africa and it is also clear that the ANC has failed on a number of fronts in tackling these issues adequately. Nevertheless, it is necessary to recognize that there have been significant improvements in the standard of living of many South Africans. According to the World Bank, the percentage of the population living below the national poverty line declined from 31% in 1995 to 23% in 2006. According to a recent publication by Stats SA, the percentage of people living under the upper-bound poverty line declined from 57% to 45.5% between 2006 and 2011. Between 1996 and 2011, according to the respective censuses, the percentage of the population (20+) with no schooling declined from 19% to 8.6% while the population who had graduated Grade 12 and/or had higher education increased from 23.4% to 40.7%. The percentage of formal housing increased from 65% to 77.6% in the same time period, and more houses gained access to piped water (61% to 73%), flush toilets (49% to 57%), electricity for lighting (58% to 85%) and basic household amenities.

Since 1994, a black middle-class has emerged – a much larger number of black South Africans now attend universities alongside white students, live in historically lily-white middle-class suburbs and hold professional or managerial positions in the economy, although major racial inequalities remain in the makeup of the country’s moneyed elites and economic power-holders. Although blacks remain significantly poorer and more disadvantaged than whites and other racial minorities, many have nevertheless seen their standards of living improve in the past 20 years.

A reason for the increase in the standards of living and a decrease in the poverty of the South African population, especially the black majority, has been the social grants created by ANC governments. In 2011, about 15 million South Africans received social grants.

Homicide rates in the RSA since 1995 (source: UNODC)

South Africa remains one of the world’s most violent and crime-ridden societies, with a homicide rate of 31.1 in 2012/2013 according to police (SAPS) statistics – representing a total of over 16,000 murders in twelve months. Other crimes are extremely common as well – according to the SAPS’s latest crime statistics, the other most common types of crime included theft, burglaries in residential premises, drug-related crimes and assault. South Africa is tragically notorious for very high levels of sexual violence – the SAPS reported over 66,000 sexual offences in 2012/2013 (an extremely high rate, representing 127 per 100,000 inhabitants) and everything indicates that the actual rate may be much higher because only a minority of rapes and sexual assaults are reported to the SAPS. Some surveys have found that about a quarter of men in two provinces admitted that they had raped someone. Thousands of children and newborn infants have been raped in the past decade (often by relatives or guardians), an horrendous phenomenon attributed to the ‘virgin cleansing myth’ which holds that someone may be ‘cured’ of HIV/AIDS if they sex with a virgin. Despite very progressive legislation on gay rights, homosexuals in South Africa face the threat of ‘corrective rape’ (to ‘convert’ them to heterosexuality). Crime-fighting efforts are hurt by the poor reputation of the SAPS, which has been hit by numerous cases of police corruption, incompetence and insensitivity up to the highest levels of the force.

Nevertheless, violence and murder in South Africa has declined since 1994 and the waning days of apartheid. In 1995, the homicide rate in the country stood at 64.9 and has fallen by 18% in the last ten years. According to SAPS statistics, most types of crime have also decreased in this period, except for robberies, drug-related crimes and commercial crime. Nevertheless, there was a slight increase in most crimes – included murder – between 2011/2012 and 2012/2013. During the negotiations to end apartheid and the pre-electoral period in 1994, several regions of South Africa were in a state of quasi-civil war due to political violence between warring parties (notably the ANC and the Zulu Inkatha Freedom Party, or IFP) and the serious threat of terrorism from white supremacist groups such as the AWB. Today, political violence between supporters of different parties has been nearly eliminated, with only limited incidents during election periods in a handful of hot zones. Similarly, white supremacist terrorist organizations have almost all faded from view and pose no threat to the state.

Economic policy and socioeconomic challenges

The ANC, in general, has often prided itself on its sound management of the economy. Indeed, existing (and mostly white-owned) businesses in the country and foreign investors were fairly enthusiastic or at least positive about the ANC’s management of the economy in the 1990s and early 2000s.

The ANC was born as a small, moderate black ‘bourgeois’ movement, but the radicalization of the movement after 1948, the influence of the alliance with the Communist Party (SACP), ties with the Eastern Bloc and the socioeconomic effects of segregation and apartheid on the black population meant that the ANC moved firmly to the left during the struggle against apartheid and found its allies mainly on the left. To this day, the ANC governs in a ‘Tripartite Alliance’ with the South African Communist Party (SACP) – an historic ally of the ANC and the liberation movement – and the Congress of South African Trade Unions (COSATU), the country’s largest trade union federation founded in 1985 and a major player in the liberation movement in the late 1980s. The apartheid government, under PW Botha’s ‘total onslaught’ strategy, sold the notion of the ANC as a dangerous communist movement and the ‘red danger’ (rooi gevaar, combined with the old and explicitly racist black danger or swart gevaar) to the Western world and his white constituents in South Africa.

In the Freedom Charter, a landmark document adopted by the ANC and its Indian, Coloured and white communist allies in 1955, it is stated that subsoil minerals, banks and monopoly industry shall be owned by the people (state), that the wealth of the country be ‘restored to the people’ and that the land ‘redivided amongst those who work it’. The Charter’s vision was reiterated by the ANC during the duration of the struggle, by the United Democratic Front (UDF) in the 1980s and the ANC still refers to it as a foundational document. In documents issued by the ANC during the negotiations to end apartheid, the party enunciated a ‘developmentalist’ perspective arguing for a mixed economy with some state intervention in the economy with the aim of a more equal distribution of wealth, the development and reconstruction of the economy. In 1994, the ANC and its allies adopted the Reconstruction and Development Programme (RDP), which served as the basis for the ANC’s platform in the 1994 election. The RDP largely remained in the Charter’s tradition, aimed at the democratization of the economy, alleviating poverty, addressing the catastrophic state of social services and human development for the majority of South Africans, the broader development of the economy and economic growth. Although the RDP included some economically liberal measures, the gist of it still accorded a leading role to the state in restructuring the economy. Indeed, under the guises of the RDP, the ANC government spearheaded a major infrastructure program in the 1990s which built over a million cheap houses (so-called ‘RDP houses’, often criticized for being dreary and bleak pillbox-like mass building structures), a major expansion in access to piped water, electrification, the construction of 500 new clinics and a public works program.

When it took office the ANC quickly signaled that it would not take any revolutionary or radical decisions, and instead began arguing for a fairly liberal economic policy. In June 1996, the ANC’s new finance minister, Trevor Manuel, unveiled the Growth, Employment and Redistribution (GEAR) plan as the government’s macroeconomic framework. GEAR aimed to achieve a ‘competitive fast-growing economy’ (at a rate of 6% by 2000) which would create 400,000 jobs by 2000; to reach these targets, GEAR called for the reduction of the budget deficit (to 3% by 2000), reducing inflation, a relaxation of exchange controls, a reduction in tariffs, policies to stimulate private and foreign investment, the acceleration of non-gold exports, privatization and labour market ‘flexibility’. Although GEAR still talked of income redistribution, poverty reduction and infrastructure development by the state, the general theme of the new government’s macro-economic framework was very clearly liberal and destined to please the business community and international financial institutions. The ANC - led by Trevor Manuel, labour minister Tito Mboweni (who later became Governor of the South African Reserve Bank, from 1999 to 2009), then-Deputy President (later President) Thabo Mbeki, trade and industry minister Alec Erwin and Mbeki’s right-hand man Essop Pahad - defended GEAR as necessary for sound economic growth and job creation while claiming that GEAR nevertheless remained in the tradition of the Charter and GEAR (although, in 2002, President Mbeki would claim that the ANC had never been and would never be a socialist party). The ANC, since 1994-5, had been preparing the ground for a shift away from its interventionist and ‘developmentalist’ orientations by arguing that the National Party (NP) government had left it with a huge debt and deficit – indeed, South Africa’s economy had gone down the drain due to a wide host of factors since the 1980s.

GEAR, however, was strongly criticized by the left of the movement – namely COSATU and the SACP – as being a betrayal of the Charter and RDP values and a home-grown version of the ‘structural adjustment programs’ which would be unable to address the issue of massive income inequality. In short, the left saw GEAR as ‘growth without development’, whereas the RDP sought ‘growth with/and development’.

GEAR was largely unsuccessful in meeting its targets. Economic growth never did hit 6%, and growth from 1995 to 2000 was generally weak. However, the early 2000s saw strong economic growth, under Mbeki’s cautious orthodox fiscal and monetary policies – South Africa’s economy reached growth rates over 5% between 2005 and 2007. Under Mbeki’s presidency, the domestic and foreign business community and international finance generally praised the ANC’s sound and competent handling of the economy. GEAR’s major failure, however, was jobs: the official unemployment rate grew from about 19% in 1996 to nearly 30% in 2002. Since then, unemployment and jobs has remained South Africa’s leading economic and social problem, remaining stuck at frustratingly high levels between 21% and 25% (at the official, and conservative, definition – under the expanded definition, over 35% of South Africans are unemployed). Instead of creating jobs, the policies of government and business following GEAR led to major job loses.

Official unemployment and absorption rates in South Africa since 2003 (source: Stats SA, own graph)

In Stats SA’s latest Quarterly Labour Force Survey for Q1 of 2014, the official unemployment rate stood at 25.2% – a 1.1% quarter-to-quarter increase and 0.2% year-to-year increase. Under the expanded definition of unemployment, the figure was 35%. Only 42.8% of the population aged 15 to 64 has a job. Unemployment, like almost all social and economic indicators, is conditioned by race. Under the expanded definition, 39.9% of blacks, 27.6% of Coloureds, 17.6% of Indians and 8% of whites were unemployed. There is also an even more extreme age factor: young South Africans, especially young blacks, face extremely high levels of unemployment – across all races and using the expanded definition, 66% of those 15-24 and 39% of those 25 to 34 were unemployed against 14.4% of those 55 to 64.

A 2006 study said that while the proximate cause of high unemployment was that “prevailing South African wages are too high compared to real wage levels that would clear labor markets at lower levels of unemployment”, the structural cause was the weakness of export-oriented manufacturing since the 1990s; the relative shrinkage of which led to a fall in demand for low-skilled or unskilled labour. In 2013, only 25.6% of employees in all industries were considered skilled, compared to 46.1% who were semi-skilled and 28% who were unskilled. Even in tertiary industries, only 29% were skilled and 43% had less than the Matric (South Africa’s high school graduation exam).

However, despite fairly neoliberal fiscal and monetary policies, the ANC also retains interventionist pulses – the public sector remains a major employer, the government still owns many industries and utilities, labour laws are criticized by some as being restrictive, some regulations and laws still deter private and foreign investors, employment equity laws impose increasingly strict guidelines on businesses and subject them to fines if they break them, corruption is a major problem and the new dispensation since 1994 has been used by a lot of ANC cadres to enrich themselves in business, creating a crony capitalist system.

It is also worth pointing out that despite an economic record which is very far removed from traditional socialism, the ANC ‘talks left, walks right’ with leftist rhetoric which still talks of the ANC as a ‘revolutionary liberation movement’, an ‘economic revolution’ and the ANC styles its ideology and policies as the ‘National Democratic Revolution’.(

For a party which had an ostensibly ‘radical’ economic platform prior to winning office, why did the ANC shift towards neoliberal policies? The negotiations to end apartheid in South Africa are sometimes referred to in the literature as an ‘elite pact’ – the elite of the old ruling party, the NP, reaching a compromise and agreement with the elites of the opposition liberation movement, the ANC. In these negotiations, the NP conceded a number of important issues to the ANC – it abandoned all previous demands for entrenched group rights, ‘minority vetoes’, consociational government, special legislative and executive representation for races and effectively accepted the ANC’s maximalist demands of majority rule, one man one vote, centralized devolved government and a Bill of Rights based on individual rather than group rights. In return, the ANC adopted a liberal democratic constitutional framework, the independence of the judiciary and some form of limited protections for linguistic and racial minorities. However, the most significant concession made by the ANC to the NP was its acceptance of a liberal, capitalist macroeconomic framework which guaranteed property rights, the continuation of orthodox fiscal and monetary policies and a general focus on growth and economic stability rather than redistribution.

The NP’s own evolution from defense of minority rights (and opposition to majority rule) to a more impassioned defense of the existing liberal capitalist economic model was a gradual process, whose roots were apparent beginning in the early 1970s. After HF Verwoerd’s assassination in 1966, the NP shifted from the Afrikaner nationalism of the 1940s – with its core tenets of republicanism, anti-imperialism, Calvinist mysticism and opposition to ‘English’ (or ‘Jewish’) monopoly capitalism – towards pan-white nationalism, which sought alliance and conciliation with the English-speaking whites (the traditional opponent of the Afrikaner) in the context of shared opposition to black majority rule, ‘communism’ and the defense of capitalism. This shift was facilitated by the settlement of the republican question in 1961 and the economic advance of the Afrikaner since 1948 as a result of NP policies; under the prime ministership of BJ Vorster (1966-1978), apartheid was increasingly subordinated to economic concerns when the two clashed (but, at the time, white supremacy remained beneficial to the South African capitalist economy). Radical white supremacists – such as Albert Hertzog and his followers, who were expelled from the NP in 1969 – challenged this new paradigm, defending a dogmatic and bygone vision of ‘Verwoerdian apartheid’, but the NP remained firmly in control. Within the NP, the verligte (enlightened) faction emerged, grouping well-connected economically liberal individuals in the party who placed capitalism above rigid defense of apartheid and were willing to compromise on some aspects of white supremacy in order to protect white minority rule. The verligte, in contrast to the conservative verkrampte, were pragmatic, flexible, open to compromise and eventually evolved towards neoliberal capitalism in the 1980s.

Under PW Botha (1978-1989), the priority of the NP government became the defense of white minority rule against an upswell of black resistance following the strikes in 1973 and the Soweto riots in 1976. To achieve this aim, Botha used several tactics – mixing reform with repression. Botha enjoyed close ties with the traditional Afrikaner business elites in the Cape Province, and Botha’s economic team – with Barend du Plessis, an admirer of Margaret Thatcher’s policies in Britain, serving as his finance minister after 1984 – was clearly neoliberal in orientation (although Botha had no clearly defined economic views himself). He came into office when the apartheid system had contributed to an economic deterioration - because of the rigidity of influx control, a severe skills shortage and an artificially limited domestic consumer market. Faced with growing demands from big business and Afrikaner capital, Botha’s government acceded to some of their requests to adapt apartheid to the capitalist economy.  For example, Botha’s government adopted the recommendations of the Wiehahn and Riekert commissions (appointed by Vorster), which had called for the legalization of black unionization within limits, the regularization of urban blacks by granting them property rights and the relaxation of influx control (all the while tightening the screws on blacks outside urban areas or illegal black migrants from the ‘homelands’) – in a nutshell, the NP finally admitted what had been obvious since the 1940s – black urbanization was a permanent reality (accepted by the United Party’s Fagan Commission in 1948, but rejected by the NP’s Sauer Commission). Under Botha, the aim of his ‘reforms’ were to coopt pliable non-white elites into the system in order to perpetuate white minority rule and domination. The business sector saw the lack of a black middle-class as an obstacle to the survival of capitalism, and the NP realized that it would need to find black allies in order to maintain power. Botha’s attempts at cooptation of blacks, Coloureds and Indians (the latter two groups with the Tricameral Parliament) failed horribly, and by the second half of Botha’s stint in office, the focus shifted to repression and the consolidation of the ‘securocracy’ at the helm of the state. The economy collapsed even further under the weight of international sanctions, capital flight, growing indebtedness and a rapid increase in the levels of violence and political instability throughout the country (with states of quasi-civil war building up in KwaZulu-Natal and the PWV). However, Botha’s eclectic strategy of reform through cooptation and ‘total onslaught’ repression under an opaque and often extrajudicial securocracy signaled a major shift in the NP’s identity and class basis. With the split of Andries Treurnicht’s hardline faction to form the Conservative Party (KP) in 1982, the NP moved from being a cross-class Afrikaner nationalist alliance to a white-dominate elite alliance of whites (Anglo and Afrikaner) and pliable non-white tools. With the economic crisis, Pretoria had also become increasingly dependent on loans from the IMF and private lenders, and it had adopted neoliberal IMF-dictated policies (notably privatization.

During the negotiations to end apartheid under FW de Klerk’s presidency, the verligte faction – now represented by Roelf Meyer, a young technocrat who went on to become the NP’s lead negotiator alongside the ANC’s lead negotiator, trade unionist Cyril Ramaphosa – gained the upper hand over the verkramptes, who were determined to fight till the end to protect minority rights or gain a ‘white veto’ under the new constitutional arrangement. Seeing that minority/group rights were unpalatable to the ANC and even the West, the verligte leaders compromised with the ANC and their interest became clinching an elite compromise to secure conditions for continued capital accumulation. To prod the ANC away from its interventionist and socialist inklings, the NP led a concerted effort along with business leaders, foreign investors and international financial institutions to move the ANC in the direction of free-market capitalism. South African business leaders had began meeting with ANC leaders in exile as early as 1986, and as the negotiations on a new constitution moved forward, parallel meetings were being held between ANC leaders and business leaders. Derek Keys, a former mining executive who was brought in as FW de Klerk’s technocratic finance minister, played a major role in these talks with ANC leaders (people including Manuel, Mbeki, Mboweni etc) and bringing them towards ‘pro-business’ viewpoints with guarantees to protect property rights and abandon any serious intentions of nationalization. These negotiations not only included the ANC but also COSATU, who agreed to tariff reductions and GATT/WTO membership. The collapse of the Soviet Union, the end of the Cold War and the rising tide in favour of free market solutions were further impetuses on the ANC to move away from interventionist and socialist ideas. Unlike other African liberation movements, the ANC gained power in an era where there was no ‘alternative’ economic model to capitalism as there had been during the Cold War.

In the end, therefore, the NP had successfully pushed the ANC towards accepting the core tenets of the free-market economy and capitalism. After taking office in 1994, the ANC therefore honoured its part of the ‘elite pact’ with the NP – Derek Keys was kept on for a few months after the 1994 election and the incoming ANC government revised the original RDP (drafted in collaboration with COSATU and the SACP) with a White Paper which effectively laid the ground for GEAR in 1996.

Perhaps the best example of ‘elite pacting’ came in 2005, when the remnants of the NP (rebranded as the New National Party) merged with the ANC. Since the NP’s ill-advised decision to quit the national unity cabinet with the ANC in 1996 and FW de Klerk’s later resignation from the leadership (and his replacement by the incompetent Martinhus van Schalkwyk, who is now the ANC Minister of Tourism), the NP had lost its white supporters (in 2004, the bulk of the NP’s vote came from Coloureds – a group which the NP had disenfranchised in the 1950s) and was unable to become an opposition party. It waffled between frontal opposition to the ANC or cooperation with the ANC government, finally settling in favour of the latter. The ANC-NP merger certainly does appear quite contradictory given the party’s history, but by 2005 the hardliners had decamped and the NP had long since given up being an ethnic party. Already during the transition, the verligte leaders had been able to safeguard the interests of (predominantly white) capital and expand the ranks of the property-owning middle-classes to blacks. Unable to deal with the loss of power, the NP found the only way out of the hole and the only chance to share the spoils again: merging with the ANC. The merger aroused some opposition within the ANC, notably from the SACP (though mostly because it feared the NP was a Trojan Horse which would turn the ANC into a right-wing party); but Mbeki’s allies had actively supported a merger which went down on terms extremely favourable to the much stronger ANC.

Affirmative action and Black Economic Empowerment

Instead of nationalization, the ANC government has implemented affirmative action policies – known as Black Economic Empowerment (BEE, or officially Broad-Based Black Economic Empowerment) and Employment Equity – to address apartheid’s economic legacies. The ‘designated groups’ who benefit from BEE and Employment Equity are blacks, Coloureds, Indians, women of all races and people with disabilities of all races.

Under Employment Equity, first adopted by law in 1998, all designated employers (firms with over 50 employees) are obliged to make their workforces racially representative through analysis of workforce demographics and employment practices and the yearly submission and implementation of an employment equity plan/report (including numerical goals to achieve equitable representation suitably qualified people from designated groups). In effect, employers must set and meet racial targets to make their workforce representative of the economically active population (so it must be 75% black), and they are subject to fines – made more onerous by a series of controversial amendments to the Act in 2013 – from the government if they fail to do so. The 2013 amendments also raised significant controversy and concerns over ‘racial quotas’ because it repealed provisions which forced the government to take into account skills shortage when evaluating employers’ compliance.

Although Coloureds and Indians are legally entitled to benefit from Employment Equity, the behaviour of the Department of Labour and the wording of proposed bills in recent years have raised controversy. The 2013 amendments ultimately retained the clause requiring the government to take into account national and regional workforce demographics when assessing employers, a prior 2010 bill had removed references to ‘regional’ demographics. Because the Coloured population are heavily concentrated in the Western Cape and Northern Cape provinces, and Indians are largely concentrated in KwaZulu-Natal (KZN), there was significant concerns that Coloureds and Indians would struggle to find employment in their home provinces. The Director-General of Labour added fuel to the fire by stating that Coloureds were ‘over-concentrated’ in the WC.

BEE’s aim is to make the economy more broadly representative of the demographic makeup of South Africa, by promoting meaningful black ownership, management, employment, training and skills development in South African companies. Each company (with a turnover over R10 million) is evaluated by the government on a BEE scorecard, under which they are required to meet minimum requirements in a number of different areas (ownership, management, employment equity, skills development, procurement from BEE firms, supplier/enterprise development etc). To achieve the requirements of BEE, companies undertake a number of BEE initiatives – policies, practices and business transactions (for example, selling shares in a company to a company owned by blacks). The company’s score on the BEE scorecard increases or decreases their chances of winning government procurement contracts and insufficiently ‘empowered’ companies in regulated sectors may see their licences revoked. Responding to criticism that the first BEE scheme was heavily focused on enriching a select few, the Mbeki government adopted ‘Broad-Based Black Economic Empowerment’ (B-BBEE) in 2003, which aimed to distribute wealth across a broader spectrum.

This text from the Institute of Race Relations gives a good overview of the EE and BEE laws and codes as they stand after the 2013 amendments, and explain the costs of both policies on small businesses.

BEE has been a highly divisive issue in South African politics. There has been the common criticism leveled against affirmative action policies in general, but there is broader criticism of the results of BEE. Instead of redistributing wealth and jobs to the black majority, BEE has been perceived as having helped a well-connected few – ANC cadres, black entrepreneurs and other black middle-class individuals on good terms with the ANC – while leaving the bulk of the black majority in continued poverty. Indeed, a lot of the BEE deals – valued at R600 billion according to the Institute of Race Relations – have benefited a small closed circle of black entrepreneurs, many of them with close indirect or direct (serving on party executive) links with the ANC, COSATU and the SACP. The ANC has been accused of using BEE as a means of providing patronage, meting out punishment and co-opting potential rivals within the Alliance and allowing them to make a buck. A number of ANC leaders from the struggle era have benefited quite handsomely from BEE and the new economic policies, joining the ranks of an increasingly deracialized business elite – people such as Tokyo Sexwale, Cyril Ramaphosa, Jay Naidoo and Saki Macozoma have become wealthy businessmen, even while keeping a foothold in politics. Sexwale, a former provincial premier and the Minister of Human Settlements from 2009 to 2013, sat on the boards of several important corporations and founded Mvelaphanda Group, a large holding firm which had interests in diamond mining and oil and which made Sexwale one of the top beneficiaries of BEE. Although Sexwale officially gave up most of his business interests and chairmanships when reentering in 2009, a lot of business empire (especially as it relates to mining) remains clouded in secrecy – with unclear secret dealings over mining deals in Guinea, for example. Ramaphosa, a former trade unionist (in the National Union of Mineworkers, or NUM, one of the main unions in COSATU) who was touted as one of Mandela’s potential successors in 1998-9 before being sidelined in favour of Mbeki, left active politics and became a multi-millionaire with several investments in mining and seats on the boards of mining firms, including Lonmin, which owns the infamous Marikana platinum mine.

The new black business elite has been negatively perceived as a clique of ‘crony capitalists’ who have enriched themselves, joined the ranks of the elite but given little attention to the plight of the black majority.

Black, Coloured and Asian average income per capita as a % of white income (=100), 1917-2008

In general, BEE’s success has been rather limited. While it has succeeded in broadening and deracializing the ranks of the elite, which had been the goal of the ANC-NP ‘elite pact’ in 1994, BEE has not really radically altered the ownership structure of the South African economy. A number of companies complied with BEE solely on paper (officially defined as ‘fronting practices’ by a 2013 amendment to the B-BBEE Act, and now punishable by potential jail time), but actually limiting blacks from participating in the management or granting associated economic benefits. In 2010, The Economist reported that blacks served as the CEOs/CFOs of only 2-4% of the 295 companies on the Johannesburg Stock Exchange; they are present in larger numbers (but still far below the actual demographic makeup of the broader population) on the boards. Most of the economy remains controlled by white South Africans.

Generally, the larger white-owned corporations and big businesses have generally adapted to the new constraints of BEE and the new post-apartheid dispensation quite well. The ANC has made friends with leading businessmen (Anton Rupert and Harry Oppenheimer, two of South Africa’s most well-known business magnates of the 20th century, became friendly allies of the ANC after apartheid – a system which they had generally opposed but still benefited from), regardless of race, a friendly association for which the ANC has often been criticized. A lot of the larger businesses have not criticized BEE: they know that the ANC and BEE are here to stay, many understand the rationales and aims of BEE and they have the resources to adapt to the system. The costs of BEE have generally been less onerous for the larger corporations than for smaller businesses, who have tended to suffer most from the high costs associated with BEE transformations. The amendments to the BEE codes in 2013, which set even stricter requirements for black ownership, management control and procurement and which made achieving strong results on the BEE scorecard considerably more difficult, will likely hurt small businesses and family-owned companies (who also have to comply with mandatory EE laws, made more stringent by 2013 amendments). Critics of the EE and BEE legislation say that small businesses bear the heavy costs of meeting ‘unrealistic’ EE racial targets and complying with BEE guidelines (especially if they seek to keep the government as a potential customer); the pressures may in turn force them out of business, adding to the crisis of unemployment.

Instead of alleviating the problem of income inequality in one of the world’s most unequal societies, BEE and other government policies may have instead aggravated the problem. South Africa’s Gini coefficient has actually increased since the fall of apartheid, and has stabilized at about 0.7 in the last decade, making South Africa one of the world’s most unequal countries. Existing income inequalities between the races have been worsened by growing income inequalities within racial groups: for black South Africans, the Gini coefficient increased from about 0.5 to over 0.6 since the fall of apartheid. Today, over half of the black population remains poor, while less than 1% of whites lives under under the upper-bound poverty line.

Land reform

Land reform has been another legacy of apartheid which the government has struggled to address. The years between 1870 and 1920, especially the post-Boer War years, saw the growth of commercial and capitalist (white) agriculture in South Africa (especially in the British colonies of Natal and the Cape), with the consolidation of land in the hands of powerful large landowners at the expense of poor white landless tenant farmers (bywoners) and black tenant farmers and squatters. This transformation was accompanied by a succession of legislation which aimed to disposes Africans peasants of their relative independence and/or their access to white-owned land, ultimately culminating in the 1913 Natives Land Act. The Natives Land Act confined black land ownership (in a communal framework) to the ‘native reserves’ – rural areas which made up 7% of the country’s territory (increased to 13.5% with the Native Trust and Land Act, 1936) and which would form the basis for the apartheid-era homelands or Bantustans. In ‘white South Africa’, blacks were banned from buying or hiring land.With the Land Act, blacks were ‘proletarianized’, being forced to become cheap migrant labour for the mines and cities or farm workers dependent on a white landlord. NP rule in the 1960s and 1970s boosted larger farms, leading to an increase in the size of farms and a decrease in the number of farmers. The white-owned farms became mechanized agri-businesses, and beneficiaries of generous agricultural subsidies from the NP government. When apartheid ended in 1994, about 87% of privately-owned commercial farmland was owned by whites.

The Constitution adopted in 1996 guarantees property rights, although a clause of the Bill of Rights allows for expropriation with compensation “for a public purpose or in the public interest”, a term which explicitly includes land reform. The Bill of Rights also grants persons or communities dispossessed of property by the Land Act or other racially discriminatory laws the right to restitution of property or equitable redress.  The ANC government passed as Restitution of Land Rights Act in 1994 to govern the process of restitution or equitable redress envisaged by the Constitution, setting December 31, 1998 as the deadline for applications for land claims. A commission was created to resolve restitution claims, through negotiated settlements rather than expropriation. Under restitution, most claimants have settled for financial ‘redress’, although 2.6 million hectares had been redistributed by 2009.

The window for claims closed in 1998, but in 2013, about a quarter of claims registered with the government were not yet finalized and about 50% of the land acquired for restitution had not yet been transferred. In 2013, the ANC government passed a Restitution of Land Rights Amendment Bill, which reopened the window for restitution claims and extended the deadline to 2018. The law was criticized for undermining independent ownership rights in favour of traditional tribal leaders, the financial cost of reopening restitution (R129-R179 billion), limits on land restoration made dependent to ‘productivity’ and confusion around pre-1913 claims (for example, the Khoisan people dispossessed of their land prior to 1913).

On the separate issue of land reform (redistribution), the ANC adopted a policy of “willing buyer, willing seller” at market price, similar to the British-funded scheme in Zimbabwe between 1980 and 1992 and policies promoted by the World Bank, and set an initial target of redistribute 30% (26m ha) of land to black people by 2014. However, twenty years later, only 6-7% (less than 3m ha) of land has been redistributed – pushing the government to push back the ‘deadline’ to 2025, although it is estimated that if current performance continues, the likelihood of reaching that target by 2025 is low. Furthermore, a lot of the land which has been redistributed lies unused because of a lack of capital, skills shortage, the poor quality of a lot of the redistributed land (the high-quality land is often beyond the means of those black farmers who can acquire land), the government’s excessive focus on commercial agriculture and a lack of support services from the state. The land redistribution process has been hampered not only by intransigent white landowners as the ANC likes to claim, but also by insufficient budgets – it has already cost the government $6 billion, and the extension of the deadline to 2025 could cost it another $9.4 billion.

The ANC has been criticized for having chosen a very cautious and conservative path, and interpreting that property rights language of the Bill of Rights in a way which limits the government’s ability to intervene. The Minister of Agriculture and Land Reform between 1996 and 1999, Derek Hanekom, a white Afrikaner ANC member, took a fairly activist and pro-redistribution stance, but under Mbeki’s presidency, he was replaced by Thoko Didiza, whose ministry now tended to focus heavily on commercial farming by a new class of black commercial farmers rather than alleviating poverty.

Others, wary of radical land reform (such as the fast-track land reform/expropriation without compensation policies pushed forward, with disastrous results, by Robert Mugabe in Zimbabwe), have argued that the issue is one of land development and use rather than land tenure, and often warn that a Zimbabwe-like approach to land reform in South Africa would prove economically disastrous because a lot of white-owned farms are productive agri-businesses and major employers. Some point out that the government itself owns a lot of land which is currently unproductive. The general failure of land reform since 1994, the poor experience on redistributed land (for a variety of reasons) and tense relations between white owners and black farm workers or landless blacks has significantly heightened tensions in rural areas. Well publicized farm attacks – often by unemployment young black men against white farmers – have attracted a lot of attention in the West, although their numbers are hard to quantify and there have been numerous misconceptions or urban myths surrounding farm attacks (for example, there is little proof that the attacks are politically motivated).

Corruption and the arms deal

Corruption has been a major problem in post-apartheid South African politics, with a widespread perception both domestically and abroad that the government is extremely corrupt and ‘kleptocratic’. The reality isn’t that horrendous – while corruption is a reality, South Africa is actually one of Africa’s least corrupt countries – on the 2013 Corruption Perceptions Index, South Africa ranked 72nd in the world (placing it behind Botswana, Rwanda, Ghana and Lesotho) and actually is ranked as less corrupt than India, PR China and EU member-states Greece and Bulgaria. However, a lot of South Africans compare their country’s corruption problems with that of other G20 members, and, indeed, with such comparison, South Africa is considerably more corrupt. Two decades of ANC rule have worsened the problems of corruption and especially the impunity of politicians and public servants. The ANC has tended to fight tooth and nail to defend its corrupt MPs and cabinet ministers from prosecution, it has perverted independent state institutions (such as the SAPS, the Auditor General or the National Director of Public Prosecutions) to keep them from doing their constitutional job to investigate and punish corruption, and it has blocked Parliament and its own MPs therein from investigating corruption and holding the government to account as it is constitutionally mandated to. The electoral system contributes to the difficulty of Parliament to hold the ANC and government to account: all MPs are elected from a closed party list, and their ranking on the party list (and, hence, their chances of winning a seat) are determined solely by their party rather than by voters, so their actual accountability is with the party which got them there in the first place. It is no secret that an ANC MP (or an opposition MP) who has criticized the party’s leadership or acted contrary to leadership fiats are often forced to resign from office or are removed/downgraded from the list at the next election.

The largest scandal in post-apartheid South Africa – perhaps even in South African contemporary history – is the massive Arms Deal scandal which dates back to the last years of Nelson Mandela’s presidency but which continues to haunt the ANC to this day and his directly involved incumbent President Jacob Zuma and several ANC cabinet ministers past and present. In 1998-9, the ANC government announced its intention to modernize the South African National Defence Forces (SANDF)’s defense equipment with the purchase of frigates, marine helicopters, light fighter aircraft, submarines and battle tanks – the very idea of this deal was soon questioned, given the new government’s purported committment to reducing defense spending in favour of reducing poverty. The deal, finalized in 1999, involved about R50 billion (1999 rands) in purchase of new military equipment from German, British, Swedish and French arms firms. Beginning in 2000, the first allegations of corruption, bribery, gross conflicts of interest and fraud began to emerge, through the work of whistle-blower opposition MP Patricia de Lille and an investigation by the Auditor General. The first questions pertained to the decision to award the fighter jet contracts to BAe/SAAB – the costlier bid (in this big contract, the government decided to exclude cost as a criteria, despite a cheaper and technically equivalent bid by the Italians), the decision to grant the frigate deal to the German Frigate Consortium, the allocation of a naval sub-contract to a French company at substantial cost and inadequate offset guarantees from the successful bidders. The actual costs of the deal quickly ballooned out of proportion, far exceeding the government’s initial estimates.

The Minister of Defence at the time, former Umkhonto we Sizwe (MK, the ANC’s armed wing during the struggle) commander Joe Modise, was alleged to have received R5 million from BAe to the MK Veterans Asssociations, R10-35 million in bribes from various bidders and shares in a defense company (Conlog) which benefited from the arms deal (Modise would later become chair of Conlog after leaving office). The Director of Procurement in the SANDF, ‘Chippy’ Shaik, was accused of favouring his brother, Schabir Shaik, who was director of a company (partly owned by Thomson-CSF, a French contractor chosen by the German Frigate Consortium to provide the combat suits for the ships) bidding for sub-contracts. That naval suit contract had gone to Thomson-CSF over a local contractor favoured by the Navy itself; it was no coincidence that Schabir Shaik’s company was owned by Thomson-CSF and that its board included people linked to Chippy and Joe Modise. Altough Chippy, in a parliamentary hearing, claimed to have recused himself from meetings where his brother’s interests were discussed, it soon became clear that he had lied – he had participated and intervened in government meetings, to promote his brother’s business.

As Parliament’s Standing Committee on Public Accounts (Scopa) began an investigation, under the leadership of IFP MP Gavin Woods and ANC MP Andrew Feinstein, further details of corruption in the arms deal began to be uncovered. Contractors who had not been selected alleged that Chippy Shaik and men linked to Modise were expecting bribes if their bids were to be seriously considered by the government or to give a ‘push’ to their bids.

The ANC leadership in government (Deputy President Jacob Zuma) and in Parliament (the Speaker), as well as the National Prosecuting Authority (NPA) initially assured Scopa of their full support for the arms deal investigation. But as Scopa, spearheaded by Woods and Feinstein, began digging too deeply and sought to involve the Special Investigating Unit (SIU, an anti-corruption authority with the power to recover money lost to corruption and crime) in a wider investigation, the ANC leadership in government (led by Essop Pahad, President Mbeki’s ruthless enforcer) quickly moved to rein in the investigation, brought the ANC’s parliamentary leadership under the whip, undermined Scopa’s work and made sure that the SIU was not part of any investigation. Mbeki resisted pressure from the media and civil society, and refused to sign a proclamation for SIU to participate in the investigation. Scopa’s ANC members were turned against Feinstein and the investigation, and obediently obeyed the party line. The Auditor General, who had originally independently pursued the case, was bullied by the Presidency and the government into submission. As Andrew Feinstein, the maverick ANC MP defied orders from above, he was relieved of his chairmanship of the ANC component of Scopa and was finally compelled to resign from Parliament in August 2001.

The Auditor General’s report into the deal, in November 2001, included several serious accusations or comments (Modise’s behaviour with Conlog, Chippy’s conflict of interest, non-compliance with procedures) but ultimately avoided the issue of cabinet’s honesty on the costs and exonerated cabinet of any wrongdoing. It was later revealed by the media that the report had been doctored by the concerned ministers, the President and Chippy before publication. The published report absolved the cabinet of wrongdoing, whereas the original wording had said that Ministers could have influenced decisions during the process to select the costlier BAe/SAAB bid. That aircraft had not been the preferred option of the Air Force (SAAF), it was not of much greater technical capacity than Italy’s Aeromacchi jet but it was selected after the cabinet subcommittee decided to remove cost as a criteria. Nevertheless, Parl

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