The Democratic Alliance (DA) has condemned Minister Parks Tau’s unilateral announcement of a R100 billion Transformation Fund to exclusively support black businesses, labelling the move "irresponsible" and "illegal".
The fund aims to address financial barriers faced by historically disadvantaged groups, including black South Africans, women, youth, people with disabilities, and those in rural and township areas.
The party criticised the minister for bypassing necessary Cabinet discussions and approvals, undermining both good governance and the Government of National Unity (GNU).
In a statement, DA spokesperson Toby Chance on Trade, Industry & Competition expressed opposition to the plan, which proposes imposing obligations on private companies through the Broad-Based Black Economic Empowerment (BBBEE) codes, requiring contributions to the fund under the threat of penalties.
"The minister’s plan to impose further obligations on the private sector through the BBBEE codes and force companies to contribute to this fund or face penalties is not only uncompetitive but also illegal," the DA said.
The DA has also raised concerns about the fund’s potential for corruption and mismanagement, noting the lack of accountability within the National Empowerment Fund, tasked with administering the initiative.
"This fund could very easily become a bottomless pit for taxpayers’ money, with little to no oversight or meaningful outcomes," the party warned.
Furthermore, the DA criticised the Minister’s approach as a violation of the principle of good governance.
"It is unthinkable that the Minister would announce a policy of this magnitude without ensuring the necessary legal processes are followed. The government cannot arbitrarily impose taxes or new financial obligations on businesses without proper legislative procedures," said Chance.
The party has called on Minister Tau to immediately present the matter to Cabinet for proper discussion and approval. "The DA will not support any effort that seeks to undermine the rule of law or jeopardise the competitiveness of the South African economy," it said.
The DA vowed to continue advocating for a government that operates transparently, consults its partners, and adheres to the law, emphasising that such a "reckless plan cannot and will not be allowed to proceed without the necessary legal framework and Cabinet approval."
IOL Politics