The Institute of Race Relations Challenges BEE on Community Schemes

Mmamoloko Kubayi, South Africa's Minister of Human Settlements, has ignited controversy with her proposition to enforce a race-based economic shift on community schemes. The move has raised alarm about repercussions on homeowners and the middle-class sector. The Institute of Race Relations (IRR), seeking clarity and challenging the minister's intention, has pledged to resist this contentious policy change.

Almost a month ago, Minister Kubayi addressed the Community Schemes Ombud Service (CSOS) Indaba, suggesting that community schemes — including sectional title complexes, homeowner associations, retirement housing schemes, share block companies, and housing cooperatives — should undergo mandatory 'economic transformation'. The insinuation is the imposition of racial laws such as Black Economic Empowerment (BEE) into these community schemes, a policy that has not had remarkable success since implementation.

As South Africa grapples with declining service delivery, unemployment, low economic growth, and persistent inequality, enforcing more laws premised on race seems counterintuitive. Rather than tackling these fundamental challenges, the government's focus on community schemes feels misguided to the IRR.

Housing and related costs often form the largest monthly expense for many South Africans, and the potential introduction of enforced BEE as a kind of tax could have significant implications for middle-class citizens. The IRR has sought clarity from Minister Kubayi on several fronts, including consultation with community scheme stakeholders, the potential implications and consequences of BEE on community schemes, and the legal basis for expanding BEE into this sector.

While the IRR has been active in seeking this clarity, many organisations in the community schemes sector are yet to voice their stand on Minister Kubayi's viewpoint. Amid these developing circumstances, the IRR gears up to fight this proposed policy change, drawing parallels to their successful fight against apartheid.