Writing on Politicsweb, Ann Bernstein, who heads the Centre for Development and Enterprise, a think-tank, argues that policymakers are “doubling down” on an approach that has already failed to deliver broad-based economic inclusion. Instead of widening participation, the proposed changes risk concentrating benefits among a smaller group of firms while placing new constraints on business activity.

At the centre of the critique is a shift in procurement policy. The proposed revisions would significantly favour firms that are 100% black-owned, while reducing recognition for those that are majority black-owned or that have made incremental progress on empowerment. Bernstein argues that this move ignores the structure of the existing business landscape, where fully black-owned firms remain a small minority, often with limited scale.

The likely consequence is a contraction in the pool of eligible suppliers. Companies may find it harder to meet procurement targets, supply chains could be disrupted, and many black-owned businesses that do not meet the stricter thresholds may be excluded from opportunities they currently access.

The proposed Transformation Fund is also flagged as a concern. Firms would be required to contribute a portion of after-tax profits in exchange for empowerment credits. Bernstein questions both the design and the governance of such a fund, warning that it could centralise decision-making and introduce new risks around how capital is allocated.

The broader argument is that the reforms move policy further away from market-based empowerment and toward a more prescriptive, state-directed model. After more than two decades of Black Economic Empowerment policy, Bernstein suggests the need is not for intensification, but for reassessment.