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Positive departure

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Positive departure

9th September 2011

By: Terence Creamer
Creamer Media Editor

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The fact that the Energy Intensive User Group (EIUG) has decided to lay down a marker on future power prices well ahead of the next round of tariff deliberations is a positive departure from previous lobbying efforts undertaken by the South African business community.

Highlighting business concerns about the price path well ahead of Eskom’s actual application to the National Energy Regulator of South Africa is not merely proactive but constructive, as it will place the affordability issue at the very heart of the deliberations processes to come.

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It also represents a positive departure from the reactive stance taken by business on such important issues as labour legislation reform, the Gauteng toll roads and the destructive nationalisation rhetoric.

The EIUG’s warning that power prices are approaching an affordability ‘tipping point’ unless there is greater policy, regulatory and investment coordination to moderate the rate of increase comes at a time when there are signs that other business organisations are also beginning to take issues to government rather than simply waiting for the issues to come to them.

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Another notable example was the Chamber of Mines’ recent presentation to lawmakers, during which CEO Bheki Sibiya presented research indicating that black ownership among its members currently averaged 28%, ahead of the stipulated 2014 target of 26%.

The figures are debatable, with government insisting the com- panies are lagging in their transformation commitments. But the very fact that the chamber took the proactive step to highlight the progress (as it sees it) in a measured, yet assertive, manner is indicative of an evolution taking shape in the way business interacts with government and other stakeholders.

Although somewhat belated, the mining chamber is now also beginning to offer valuable counter arguments to the call for nationalisation. Its quantitative research outlines the already material contribution of the sector to investment, tax revenues, domestic manufacturing, jobs and community development and export earnings.

That’s not to say that the industry cannot do more. But the research also helps tease out important questions about whether a change to the ownership structure is truly key to unlocking yet further benefits, or whether these can be achieved through regulations instead.

The main point, however, is that pockets within the business community are starting to find their voices and are beginning to speak more assertively on issues that have the potential to advance or retard South Africa’s developmental progress.

The problem is that this new-found confidence is not yet a broad-based phenomenon. To reach that point, the schisms within Business Unity South Africa have to be sorted out, and sorted out in a decisive and sustainable way.

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