Mashatile denies knowledge of illegal contracts awarded to his children amid tender allegations
Deputy President Paul Mashatile likened fronting to economic sabotage when he was answering oral questions in the National Assembly.
Image: Paul Mashatile / X
Deputy President Paul Mashatile has denied knowing that his children are benefitting from irregularly awarded government tenders.
This statement follows comments from DA MP Mark Burke, who claimed on Thursday that there are concerns regarding a questionable fire detection and suppression contract.
“When it comes to Black Economic Empowerment (BEE), is the R49 million Gauteng hospital contract, awarded to your children, not further proof that BEE stands for Biased Elite Empowerment?” Burke asked during a question-and-answer session in the National Assembly.
In his response, Mashatile said he was not sure what Burke was talking about and did not know what contract he was referring to.
“Let me say this, honourable Speaker, what we do as government is to ensure that when we empower people, we do it properly, no corruption, no favouritism anywhere,” he said.
“If there are children of the Deputy President somewhere who are favoured by some government department, I will oppose it myself if I find out that there is such a thing.
“At the moment, honourable member, there is no illegal or irregular contract which was ever allocated to my children that I know of. If you do have information, you can come and give it to me,” said Mashatile.
Responding earlier to the main question posed by ANC MP Malusi Gigaba, Mashatile said B-BBEE has opened doors for many previously disadvantaged people.
“Since 2021 to date, R94 billion has been invested in black-owned enterprises, with R72bn in skills development and R600bn in shared transactions, but of course, compliance remains a challenge.”
He mentioned that he did not wish to boast about the figures, as the government must ensure the investment benefits as many people as possible.
“We are now strengthening regulation and stricter rules to ensure compliance. We must move from compliance to delivery, align B-BBEE with District Development Model but also localisation, industrialisation, and empowerment that reaches both urban and rural communities.”
Mashatile said there was need to strengthen enforcement against practices like fronting.
“It is critical to combat because it is economic sabotage. Empowerment efforts must be concrete, be reflected in job creation, establishment of enterprises, and opening of markets, and significant involvement of women, youth, and people with disabilities,” he said.
Patriotic Alliance MP Marlon Daniels said they understood the uncomfortable truth that fronting is real.
“To what extent he (Mashatile) accepted fronting and compliance-driven deal-making have weakened transformative impact of BEE and what steps are being taken to redirect BEE to broad-base participation rather than narrow group of beneficiaries?” asked Daniels.
In response, Mashatile said the B-BBEE framework was reviewed to deal with the problem of fronting.
“I did say earlier that I likened it to economic sabotage. If people are fronting, it means they are not really part of the economy. They are not doing the work. They are not building any businesses. They are sitting somewhere, but their names are used. In fact, it must be a crime that is treated seriously.”
He said that, as the review of the empowerment framework was undertaken, legislation must be tightened to ensure that strong penalties are imposed to deter people from being tempted to get involved in fronting.
“We want people to run real businesses and ensure we can measure that they run businesses, and not do desktop analysis and say ‘there are so many blacks involved and own businesses’, and we don’t see it. We need to see those businesses,” said Mashatile.
He added that the Department of Trade, Industry and Competition, and other government departments must ensure they have officials who visit businesses and verify whether black people run them as they claim.
“I agree with you that we must eliminate fronting.”
Responding to another question earlier from DA Deputy Chief Whip Baxolile Nodada, Mashatile said abandoning B-BBEE was not an option, as doing so would be abandoning transformation.
“B-BBEE is a necessary tool for transformation, essential for achieving economic equality, and we're going to proceed to implement it,” he said.