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ANC Submission to Special TRC Hearing on The Role of Business

20 November 1997


The ANC welcomes the opportunity to make this submission to the Truth and
Reconciliation Commission. We firmly believe that reconciliation in our country
depends on the coming to terms with the past by all stakeholders - including
those who had power and influence in the past. We thus welcome this inquiry into
the role of business during the apartheid period.

From the earliest days of European colonisation of South Africa, economic and
other measures introduced by successive colonial and apartheid regimes sought,
among other things, to benefit white property owners, including farmers, mine
owners, industrialists and financiers, at the expense of the black majority.

The pursuit of this objective continued throughout the period of apartheid
rule, including the years of extreme repression which the TRC is mandated to
review.

These measures included land dispossession, pass laws and influx control,
racist labour legislation and practices, wage policy, financial interventions to
help white capital, acquisitions and industrial initiatives aimed at achieving
this objective.

Throughout the period of white minority rule, these white economic interests
were not merely passive beneficiaries of the activities of the white state. They
were also active participants and initiators in constructing a political and
economic system which, in the end, was classified in international law as a
crime against humanity.

The period of extreme repression, from 1960 onwards, was intended to save the
system that protected privilege based on race, thereby continuing to guarantee
business its exclusive place in the South African economy and society.

The business community in South Africa was not in the past, any more than it
is now, a monolith. It consisted of a many different firms operating in several
sectors, numerous individuals at various levels of decision-making and a number
of business organisations. A part of the business community - black business -
was, indeed, historically oppressed and suppressed by apartheid. The ANC
acknowledges that significant forces within the historically privileged business
community, including some of the major corporations, were never directly
supportive of the ruling party in the apartheid state. Prominent individuals and
corporations were well known as supporters and financiers of (white) opposition
parties, and differences between business and the apartheid government were
evident at various times. We acknowledge, too, that the business community in
South Africa played an important role in the 1980s in setting our country on a
path towards a negotiated transition.

We, nevertheless, believe that there is a need to recognise that apartheid
was more than the programme of one political party. It was a system of racial
minority rule that was both rooted in and sustained white minority
socio-economic privilege at the expense of the historically oppressed black
majority. Apartheid was associated with a highly unequal distribution of income,
wealth and opportunity that largely corresponded to the racial structure of the
society.

The historically privileged business community, which still today owns and
controls the vast bulk of the wealth of our country, needs, we believe, to
acknowledge that discrimination and oppression played a pivotal role in
determining current patterns of ownership and control. The skewing of the
distribution of wealth, income and opportunity in favour of the white minority
was inextricably linked to the disadvantage, disempowerment and discrimination
perpetrated against the black majority. It is true that not all the laws of
apartheid were directly sought, or supported, by all sections of business. A
number, indeed, were actively opposed by important business interest groups,
which saw them as unwelcome intrusions into the operation of the market. Several
of the core measures of segregation and apartheid (which denied basic human
rights to the majority) were, however, critical in determining the growth path
and patterns of accumulation of wealth in South Africa and were actively
promoted by important business groups. More generally, apartheid created over
many years a climate favourable to the building up of resources by a privileged
minority. Many business decisions were based on, at least, tacit acceptance and
approval of the status quo until challenged by pressure from the oppressed
people themselves. These business interests protected white minority privilege.

The ANC believes that the business community must acknowledge the role of
past discrimination and oppression in shaping present patterns of ownership and
control of the economy as well as the extreme distortion in the distribution of
skills and expertise that now prevail. We believe, too, that the business
community must acknowledge both its own role in creating some of these
conditions and its extensive collaboration with a system involved in gross
violations of human rights.

Among the specific issues that we believe need to be addressed are:

1. The Role of Business in shaping Apartheid Laws

One of the major debates in South African historiography in recent decades
has been over the relationship between capital and apartheid. While some writers
argued that apartheid was an ideologically created system imposed on business
against its will, a number of well researched and credible studies have shown
that many of basic laws of segregation and apartheid were introduced to create a
cheap black labour force to benefit businesses drawn from the white minority.
Some examples:

* Pass Laws pre-dated the coming into power by the Nationalist
Party government in 1948, dating back in fact to 1760. During the nineteenth
century they were extended unevenly across the country, but their real
consolidation as an effective instrument of coercion and control dates from the
time of the development of the mining industry. With the openly stated intention
"...to have a hold on the native whom we have brought to the mines",
mineowners pressed throughout the first half of the century for a tightening up
and extension of pass laws. S.Jennings, a President of the Chamber of Mines at
the end of the last century, described the pass laws, " a most excellent
law... which should enable us to have complete control over the Kaffirs"
(as quoted in Webster, 1983, p 10). In many respects the apartheid government
can be seen as having done no more than further extending and tightening up the
application of a measure introduced at the behest of the mining houses for their
own benefit. It is our contention that the continued existence in force after
1960 of pass laws must be acknowledged as a measure that continued to benefit
the mineowners and other employers.

* The Masters and Servants Laws are another example of
repressive legislation enacted to serve employer interests. These laws made it a
criminal offence punishable by imprisonment for black workers to break their
contract by, inter alia, desertion, insubordination or refusing to carry
out the command of an employer. Breaches of contract by employers were, however,
a civil offence. These laws remained on the statute book until 1977 and
continued to be used in varying degrees by employers after 1960.

* Until the re-emergence of trade unions of black workers after the 1972/3
strikes, there was little evidence of any dissatisfaction on the part of
business with the fact that "pass bearing natives" were specifically
excluded from the formal bargaining structures set up by the Industrial
Conciliation Act
. The exclusion of Africans from the system set up` in the
1920s had indeed been insisted on by employers organisations as the price to
secure their acceptance of such an arrangement with non-African workers. The
1953 Native Labour (Settlement of Disputes) Act, which prohibited
Africans from membership of registered trades unions, it is true, drew a
lukewarm opposition from some employer organisations - mainly on the grounds
that by keeping African workers out of registered unions might make unions of
African workers more militant. However, Labour Minister Ben Schoeman's policy of
"bleeding the black trade unions to death" and the subsequent
repression of African worker trade unions drew little by way of opposition from
most business organisations. On the contrary, as we shall show later, many
businesses appeared content to respond opportunistically by holding down black
wage levels.

* Influx Control regulations represented an attempt to redirect
"surplus" black labour from the cities to the farms. While they were
opposed by some sections of business, their basic intention was to benefit white
commercial farmers unwilling to pay even minimal market related wages.

* The agricultural sector needs, in our view, to acknowledge its role in the forced
removals
of the 1960s and 1970s. These were no mere aberrations of
ideologically blinkered bureaucrats, but inextricably linked to important
changes in agriculture. Research has shown that the 1960s saw an important
change in the organisation of labour in agriculture with a shift from the
"labour tenant" to a "contract labour" system. Under the
former, workers' families were given the right to occupy and work a portion of
the farmers' land, under the latter workers were recruited to the farm for a
contract period. A sizeable proportion of the millions of people forcibly
removed from rural areas proclaimed white to the Bantustans in the 1960s and
1970s were former labour tenants - "surplus people" that no longer
ministered to the needs of white farmers who were forcibly evicted often from
the areas where they had been born.

* Group Areas laws had many intentions and effects. One was to
exclude black owned businesses from central business districts. This undoubtedly
benefited, and was intended to benefit, a number of white owned businesses that
were insulated from potential competition from black entrepreneurs. Even outside
the proclaimed white urban areas, black business was severely restricted. In
1963, the Department of Bantu Administration instructed local authorities that
African business should be confined to the homelands, and trading rights in
African townships allotted only to those qualified for permanent residence. Only
those business activities which provided for essential daily domestic activities
were to be allowed, with the result that Africans could not for instance set up
dry-cleaning businesses or garages in the townships. The prospects for
developing African entrepreneurs were to be further thwarted by regulations
forbidding Africans to own more than one business. This was extended in 1968,
when no African who had business interests in the homelands was allowed to set
up in the townships as well. Even when some of these restrictions were relaxed
by proclamation in 1976, an annexed schedule of permitted activities excluded
important areas like small scale manufacturing. There is no doubt that pressure
from constituencies in the white business sector was at least partly behind the
apartheid government's actions in this regard. Even where this was not the case
directly, Asmal, Asmal and Roberts (1996, p 135) note that:

    "Such prohibitions established a clear field for white business, while
    the exclusionary tendering practices of state and parastatal institutions
    complemented apartheid's active dismantling of black business with equally
    proactive support for privileged citizens seeking to occupy a playing field
    from which blacks were forcibly excluded. Throughout all of this there were no
    protests from white business groupings or individuals; rather they treated
    these restrictions on others as opportunities to expand the scope of their own
    activities and profits".

2. Business' Own Practices in the Apartheid Era

While apartheid legislation established a basic framework of discrimination
and oppression, the practices of many businesses were themselves often racist
and discriminatory. Such practices went further than minimally complying with
externally imposed requirements that could not be altered. Businesses themselves
often engaged in discriminatory practices that went beyond what was required of
them by apartheid law. Many businesses were also often only too willing to take
advantage of potential opportunities created by apartheid repression to advance
themselves at the expense of black workers or competitors.

The migrant labour system and the compounds were not legislated into
existence by governments hostile to business, but brought into being by the
mining houses themselves. Research has shown that the migrant labour system was
the key to the cheap labour policies of the mining industry. The Chamber of
Mines, which grouped the major mining houses, became a powerful force in
establishing highly exploitative and coercive relations in the mining industry.
Not only did it lobby successfully for a tightening up of pass laws, but itself
established monopoly recruiting organisations that institutionalised the migrant
labour system. The importance of this system to the mining houses was explained
by an official of the Chamber of Mines to the 1944 Lansdowne Commission as
follows:

    "It is clearly to the advantage of the mines that native labourers
    should be encouraged to return to their homes after the completion of the
    ordinary period of service. The maintenance of the system under which the
    mines are able to obtain unskilled labour at a rate less than ordinarily paid
    in industry depends on this, for otherwise the subsidiary means of subsistence
    would disappear and the labourer would tend to become a permanent resident
    upon the Witwatersrand with increased requirements" (Quoted in Davies,
    O'Meara, Dlamini, 1985, p 9).

Highly restrictive contracts and the closed compound system - in which
workers were segregated along "tribal" lines - formed the other main
pillar of the highly coercive system of labour control that remained in force on
the mines over many decades - and indeed features of which remain intact today.

The compound system also had the effect of forcing the workers to leave their
wives and children behind in the homelands. This had a devastating effect on the
family structure. Women who accompanied their husbands to the urban areas but
who could not live with them in the hostels and did not have jobs of their own,
were 'endorsed out' by law and sent back to the homelands.

In 1897, the mining houses agreed among themselves not to pay more than a
"maximum average" wage - thus ensuring that any labour shortages would
not result in higher wages. This agreement remained in force until the
mid-1970s. Its net effect, in the context of the other measures described above,
was that the average real wage paid to black workers in the mining industry
remained lower in 1969 than it had been in 1889 (Wilson, 1972, p46).

There were no apartheid laws that specifically prevented businesses paying
their black workers more than the prevailing minimum or which made it illegal
for employers to pay black employees at the same rates as whites. It was
decisions taken by businesses themselves that played a major role in determining
patterns in this regard.

Until pressed by a resurgent trade union movement in the mid-1970s, and in
many cases even beyond this, business generally acted as though "cheap
black labour" was a natural endowment like the weather or mineral wealth.
During periods when apartheid state repression succeeded in undermining the
ability of black workers to organise to defend their own interests, businesses
often responded opportunistically and held down wages paid to black workers. The
average real African industrial wage rate, which had risen by 50% between 1940
and 1948, fell continuously for five years after 1948 and did not reach 1948
levels until 1959 (W.J.Steenkamp quoted in O'Meara, 1996, p81). Between 1963 and
1972, when the apartheid economy boomed black wages stagnated and the wage gap
between black and white workers widened. The average monthly wage paid to
African workers in the mining industry was R 24 in 1970 - a figure lower in real
terms than the wage paid in 1889. In industry - the highest paying sector -
monthly wages paid to African workers stood at R 70, well below the various
estimates of the minimum necessary to support a family at minimal nutritional
levels. The ratio of white to African wage levels in manufacturing was 5,5:1 in
the same year, whilst in mining it stood at 16,3:1 (Davies, O'Meara, Dlamini,
1985, p 31).

For decades business appeared content to accept that black workers should be
paid less than whites. Its disputes with white workers and government over job
colour bars essentially concerned the precise level at which the white/black
divide in the workplace should be located, and what jobs previously performed by
whites could be handed over to black workers at lower rates of pay. Although
specific legislative interventions to shape racial division of labour - like
Section 77 of the 1956 Industrial Conciliation Act providing for statutory job
reservation determinations - were opposed, the basic racial hierarchy in which
whites held managerial and supervisory positions, and no black was placed in
authority over a white, was largely accepted and certainly not seriously
challenged.

Black women workers suffered even more exploitation than men. If they could
find employment, it was likely to be in the fields of domestic servants or as
farm labourers, where they were appallingly badly paid. In industry, wages were
not much better; but the worst feature for women was the lack of employment
opportunities.

At least until major skilled labour shortages became evident in the late
1960s, proposals to increase training of black workers were dismissed in the
words of a then President of the Federated Chamber of Industries as
"not...a serious possibility" (E.R.Savage quoted in Davies, 1979, p
340). Indeed, a failure by businesses to seriously contemplate this possibility
in the apparent belief that cheap black labour would be available for ever has
left a legacy that impedes efforts to grow the economy today. The backlogs in
education and skills training must be recognised as a product of past
discrimination and deliberate policy which challenges business to co-operate
with government in defining an appropriate skills enhancement strategy today.

3. Business and the Trade Unions

In the previous section, we indicated how during the early years of apartheid
administration, historically privileged business at least passively endorsed the
wave of repression launched by the regime against trade unions representing
black workers. Little sign of protest was evident from business as the regime
set out systematically to "bleed the black trade unions to death". On
the contrary, we showed that the dominant reaction was to respond
opportunistically by holding down wages of black workers. During the 1960s real
wages for black workers stagnated, and for almost ten years strikes were
virtually unheard of. This was a product of the extensive repression of the
1960s, and one which business welcomed.

A major issue we believe needs to be confronted is the attitude of business
to the re-surgence of trade union organisation by black workers after 1973. 1973
saw mass strikes erupting spontaneously in Durban among construction workers,
textile workers and municipal workers. These strikes eventually involved 60.000
workers, and for the first time in many years black workers won some small wage
increases through strike action. Following the Durban strikes, many other
strikes occurred. In many cases, these were responded to by cooperation between
employers and police aimed at crushing strikes forcefully, and even violently.
For example, police action against strikes by miners at Anglo American's Western
Deep mines resulted in the death of 12 miners.

After these events, the rebuilding of the progressive trade union movement
gathered momentum. Unions were established in all major centres. Although these
unions were not illegal, and focused on factory floor issues, 26 individuals
associated with the emerging unions were subjected to five year banning orders
in November 1976.

The emerging unions adopted a strategy of fighting for recognition at company
level. Most companies, however, proved to be extremely reluctant to grant
recognition. As late as 1979, even after labour legislation had been changed,
emerging unions were recognised at only 4 factories. Most employers preferred to
cooperate with the state in promoting dummy works and liaison committees as
alternatives to unions. In 1978 there were over 2.000 liaison and 300 works
committees in existence countrywide.

The 1976 Soweto uprising did, however, force both the state and employers to
rethink their strategies. The leaders of the apartheid state began to realise
that they would have to combine reforms with repression to retain control. It
was in this context that the government appointed Professor Nic Wiehahn to
investigate the country's labour laws in 1977. The Wiehahn Commission
recommended recognition of the right of African workers to form and belong to
trade unions in order to bring unions representing African workers inside the
official system of control.

Government proposed legislation providing for recognition, but which would
prevent unions recruiting migrant workers and prohibiting racially
"mixed" unions. Some of the emergent unions chose to register, others
to register on condition they were granted "non-racial" recognition
and others chose not to register at all.

The end of the 1970s and early 1980s saw the emergence of militant
"community" unionism and political action by unions. Consumer boycotts
of products, increased strike action and stayaways took place. Again, employer
cooperation with government in resisting these developments was commonplace.

Unions in the "homelands" suffered the worst repression. SAAWU was
banned by the Ciskei government, under whose rule most of its members lived. Its
leadership was repeatedly detained, harassed and tortured. East London employers
collaborated with this repression and steadfastly refused recognition in the
factories.

Despite organisational and political differences, the emerging unions all saw
the need for greater unity. Union unity talks took place between 1981 and 1985.
Within months of the first round of unity talks, one of its participants,
FCWU/AFCWU organiser Neil Aggett died while in police custody.

Unions inimical to democracy and which could be used as tools of employers
and the state, came into being.

Repression runs like a thread through the union movement's history. COSATU
was born into a state of emergency, and for most of its first four-and-a-half
years it operated under emergency rule. Concerted efforts to destroy unions
failed, largely because of their organised shop floor strength. In the process,
however, many unionists lost their lives, others were seriously injured, driven
into exile, imprisoned or mentally scarred. Tens of thousands of workers were
dismissed by employers for union activity, many of them being deported to rural
areas or neighbouring states.

Almost from the moment of its birth, COSATU was declared a restricted
organisation in terms of emergency regulations. Banning of gatherings severely
hampered it. From 1985 to 1989 indoor meetings which advocated work stoppages or
stayaways were also banned. Defiance of these regulations led to running battles
with the security forces who violently dispersed workers. Many workers were
killed, injured or detained for attending "illegal gatherings".

A massive strike wave accompanied COSATU's launch. In January 1986, at four
Impala platinum mines in Bophutatswana, 30.000 workers went on strike demanding
better wages and conditions. The company refused to talk to the NUM and
dismissed 23.000 workers. The dismissals were a combined operation between mine
security and the Bophutatswana police equipped with riot gear and teargas.

Mine companies maintained heavily armed private security forces and showed no
hesitation in calling on police and army units to assist them. The mine strikes
of early 1986 saw many miners killed and injured. Some mineworkers were detained
resulting in a strike on three Vaal Reef''s shafts.

As indicated earlier, COSATU was born into a state of emergency. Nearly 8.000
people were detained under the first state of emergency, and during the second
emergency 2.700 unionists were detained. Detentions were not the only form of
harassment during the emergencies. Union offices were raided, members
intimidated and the smooth running of unions disrupted.

Unions were targeted by the National Security Management System (NSMS)
created in the mid-1980s. The State Security Council (SSC) was continually fed
with information on unions from local Joint Management Centres (JMCs).
Representation on JMCs extended beyond the state security organs, including inter
alia
members of the business community, who must therefore have been
involved in passing on intelligence about unions to the state.

In addition the "Stratkom" wing of the Security Branch usually
dealt with operations affecting trades unions. These operations, according to
the scheme of things and as with other related activities, were coordinated by
the NSMS. Such operations ranged from murders, disappearances/abductions to the
theft of trade union subscriptions leading to a disruption of union activities
and accusations of corruption between union officials (the so-called
"double effect").

Workers in many workplaces protested against the visible repression by state
and employers. Militant CCAWUSA members on the Witwatersrand at almost 100 shops
downed tools demanding the release of union leaders. After police detained five
members of the NUM's regional executive, almost 2.000 miners at four of De
Beer's Kimberley diamond mines stopped work.

Strikes reached new heights in 1987. The first national strike took place at
OK, indirectly owned by Anglo American. Employer intransigence was a common
thread. The strike lasted 77 days and ended only after lengthy mediation had
produced a negotiated agreement. The public sector showed even greater
intransigence by management. The dismissal of a SATS worker led to one of the
largest strikes in the country. As a result of this strike 10 workers were
killed, many imprisoned, 4 sentenced to death and the state launched a sustained
attack on COSATU. COSATU House was destroyed in a bomb blast, for which the
apartheid state has now acknowledged responsibility.

Draft changes to the Labour Relations Act were published in September 1987.
These proposals sought to increase controls over unions. First, they proposed
restricting the right to strike. Second, they attempted to reverse many of the
unions' concrete gains on issues like job security. Third, they aimed to cower
the labour movement with the threat of awarding punitive damages to employers
for strike action.

While the campaign against this Bill was gathering momentum, the state once
again took action. On February 24 1988, the government effectively banned 17
organisations. At the same time, far reaching restrictions were imposed on
COSATU, effectively banning its "political" activities.

The campaign over the draft LRA led to the first steps being taken by
employers to reach agreement with unions on national legislation. Following
negotiations, an accord was reached between COSATU, NACTU and SACCOLA (an
employers' coordinating body) on amendments to the Bill, which served as the
basis of negotiations with government. Following this, there were other
instances where groups of employers engaged in dialogue with unions at national
level, as well as with other sections of the liberation movement.

While we recognise that historically privileged business' attitude towards
trade unions representing black workers has evolved over time, we nevertheless
believe it is important to record that the role of business during much of the
apartheid period was one of cooperation with the state authorities in taking
measures to undermine and crush trades unions. At decisive moments in the
re-emergence of the democratic movement, business' initial reaction was
invariably one of opposition, victimisation of activists and union officials,
and recourse to the regime's security forces. The first reaction to a strike, or
attempt by unions to organise workers, was all to often to call in the police.
Many violations of human rights occurred as a consequence. That trade unions
survived was due entirely to the strong organisation and commitment of thousands
of workers, despite the suffering and sacrifices endured. That the attitude of
business towards the unions changed over time is, in our view, largely due to
the fact that through determined struggle and at great cost, the black workers
established themselves as a force that could not be either eliminated through
repression or ignored.

4. Business Beneficiaries of State Patronage

It is our contention that the historically privileged business community as a
whole must accept and acknowledge that its current position in the economy, its
wealth, power and access to high income and status positions are the product, in
part at least, of discrimination and oppression directed against the black
majority. While some of the important business organisations and groups opposed
some of the laws introduced by successive apartheid governments, a number of
core discriminatory laws were both actively sought and tolerated by business.
Historically privileged business as a whole must, therefore, accept a degree of
co-responsibility for its role in sustaining the apartheid system of
discrimination and oppression over many years.

Particular sections of business were, moreover, especially favoured by the
apartheid regime. What are now powerful corporations like Sanlam, Rembrandt and
Volkskas were closely associated with the National Party and benefitted directly
from specific state support after the NP came to power in 1948. The history of
Sanlam is, indeed, inextricably interlinked with that of the National Party. It
was established in 1918 by the same individuals who founded the National Party
in the Cape. Volkskas was founded by the Afrikaner Broederbond in 1934, and as
the Broederbond's official history, published in 1979, admitted all its
directors were until that year at least appointed by the Bond (O'Meara, 1983, p
102).

These companies experienced spectacular economic growth after the coming to
power of the National Party in 1948. Sanlam's and Volkskas' assets were valued
at R 30 million each in 1948. By 1981 Sanlam's own declared total assets stood
at R 3,1 billion, while companies over which it exercised effective control had
assets worth R 19,3 billion. Volkskas' assets in the same year were R 5,1
billion (Davies, O'Meara, Dlamini, 1985, pp 70 -80)..

The awarding of government contracts to and placing of government and local
authority bank accounts with these companies was critical to this rapid
accumulation. But the relationship between these companies and the apartheid
state went far beyond this. There was a close strategic partnership between the
leaders of these corporations and the top decision-makers in the apartheid
state. Management staff regularly passed to and fro between the corporations and
parastatals.

The top leadership of Sanlam, Volkskas and Rembrandt were key players in both
the National Party and the Afrikaner Broederbond. They were the close
confidantes and advisers of political leaders of the apartheid state. Although
both Sanlam and Rembrandt became associated with the so-called verligte
wing of the National Party, the differences they had with verkramptes in
the party were not over whether, but rather over how best, to maintain control
by the apartheid regime and with it minority white economic privilege. The
relationship between these corporations and the regime became particularly close
during P.W.Botha's term as head of government. The corporations worked closely
with the military in designing the "total strategy". They were also
prominently involved in developing the apartheid state's military capacity. Less
transparent, but of critical importance in establishing the truth about our
past, is the role they may have played in the implementation of the "total
strategy" - with the gross violations of human rights associated with this.

Organisations like the Afrikaanse Handelsinstituut and white commercial
farmers groupings also had close connections with successive apartheid regimes.
White commercial farmers formed an important constituent base of the National
Party. An extensive system of state support and subsidy was established and
maintained under apartheid. There was often very little distinction between
parastatals and organisations set up by farmers themselves. Cooperatives played
the role of control boards and assets accumulated through the exercise of their
public (control board) function were often used for private benefit by
cooperatives.

Much more significant was the role of white commercial agriculture in
soliciting state support and condonence of widespread and systematic abuses of
black farmworkers' rights over many years. The "tot system", use of
prison labour, assaults and even murders that went unpunished are well known. As
indicated earlier, historically privileged commercial farmers bear, in our view,
a large measure of responsibility for the large scale forced removals of
"surplus people" that occurred in the 1960s and 1970s.

We call on the various business organisations that were intimately associated
with the apartheid regime (only some of which have been mentioned in this
submission) to acknowledge the role which they played in devising, at various
stages, strategies associated with apartheid - be they socio-economic or
repressive and discriminatory measures directed at labour or black competitors.
We believe, too, that they should be willing to accept that the assets and
wealth that they hold today are the product, in part at least, of particular
support, assistance and indeed patronage they received from successive minority
governments. We call on them, finally, to come forward and account for their
role in the implementation of particular measures, like forced removals, the
Group Areas Act and the "Total Strategy".

5. Business and the Militarisation of South Africa

The last two-and-a-half decades of apartheid rule saw the increasing
militarisation of our society. Many private sector companies benefited greatly
from this. With the accession to power of P.W.Botha in 1978, the "total
strategy" became the guiding vision of government. One of the first
priorities that P.W.Botha set for himself was the winning over of the private
sector to this vision.

The Carlton Conference, held in 1979, introduced leading business
personalities to the government's new strategy, which included the maxim that
the struggle was 20% military and 80% social, political and economic. Business
was called upon to play its economic role within this integrated strategy.
Leading business personalities were flattered by this attention, and Harry
Oppenheimer declared that the conference was the beginning of a "new
era".

However, the apartheid government did not leave matters there. Over the
coming decade the collaboration between the apartheid war machine and the
private sector was to be increasingly institutionalised. This
institutionalisation occurred on at least four fronts:

  • through the production of arms and other military equipment, under the
    general coordination of Armscor;
  • through the National Security Management System with its regional and
    Joint Management Committees;
  • through the Defence Manpower Liaison Committee (Demalcom); and
  • through the National Keypoints process, which helped privatise repression.

i. Armscor

Business' active collaboration in the production and acquisition of military
equipment for the apartheid war machine increased significantly after 1977, the
year in which the UN Security Council imposed a mandatory arms embargo on South
Africa. In that year, Armscor, which had been established in 1964 to manufacture
arms, was merged with the Armaments Board, which had been responsible for
purchasing arms abroad and maintaining cost control. The revamped Armscor was
given overall responsibility for armaments production and procurement. Its total
assets rose from R 200 million to R 1,2 billion between 1974 and 1980 (Davies,
O'Meara and Dlamini, 1985, p 104).

Central to Armscor's strategy was the forging of a strong strategic
partnership with important forces in the privileged business sector. Leading
business personalities were invited to serve on, and accepted, important
positions in armaments related structures, particularly after P.W.Botha's
accession to power as head of government in 1978. In 1979, senior Barlow Rand
executive, John Maree, was seconded by his company to serve for three years as
Armscor's executive Vice-Chair. The same company's chairperson, Mike Rosholt,
became a member of the Defence Advisory Board in 1980. Also serving on the Board
at various stages during the 1980s were such business luminaries as Anglo
American chairperson, Gavin Relly; Johannesburg Stock Exchange President,
Richard Lurie and the President of the South African Agricultural Union, Jaap
Wilkens .

Although Armscor itself became a large player, with subsidiaries responsible
for the manufacture of weapons, ammunition, pyro-technical products, aircraft,
electro-optics, naval craft and missiles, its preferred modus operandi was
to contract out as much as possible to private companies. Many private sector
companies became involved. Owing to the secrecy of these activities not all the
facts are known. In 1987, Armscor's chief executive referred to 975 companies
directly supplying Armscor (Business Day, 21/9/1987). This implied a much
larger number of sub-contractors. One researcher suggested that in 1983 Armscor
was distributing work to some 1.200 private contractors and sub-contractors, and
that at least 400 companies were dependent for their survival on Armscor
contracts (S.Ratcliffe cited by G.Simpson in Cock and Nathan, 1989, P223). In
1988 another researcher estimated that the number of private sector
sub-contractors to Armscor had grown to 3.000 (Grundy, 1988).

Whatever the precise figures, it is clear that hundreds and probably
thousands of South African private sector companies made the decision to
collaborate actively with the apartheid war machine. This was no reluctant
decision imposed on them by coercive apartheid legislation. Many businesses,
including subsidiaries of leading corporations, became willing collaborators in
the creation of the apartheid war machine, which was responsible for many deaths
and violations of human rights both inside and outside the borders of our
country. It was, moreover, an extremely profitable decision. Billions of Rands
of taxpayers' money, channelled through secret defence accounts, subsidised
hundreds of private sector companies. Cost effectiveness was not a central
issue. Secrecy and the ability to deliver large quantities of the required
materials were the pre-eminent criteria.

The parasitism of many of these local private sector companies went further
than this. Despite boastful claims to the contrary, many of the local private
sector corporations were not involved in the genuine development of these war
materials. They were more often useful conduits for foreign technologies,
helping the apartheid state to evade the UN arms embargo. Local private sector
corporations often worked with foreign holding companies or subsidiaries. Local
private companies, on behalf of the apartheid state, also used the loophole of
"dual purpose" products (products that had both a civilian and
military application), pretending that the products were being imported for
civilian use.

There are many examples of this kind of operation. Barlow Rand, one of the
leading industrial groups in our country, was heavily implicated. To take one
example: In 1977 Barlow Rand bought a 50% stake in the British-owned General
Electric Company (South Africa). Included in this deal was Marconi (South
Africa), a long standing major supplier of radar and communications equipment to
the SADF, but then feeling the heat of the UK government and UK public
anti-apartheid opinion. This kind of deal enabled the overseas companies to take
pressure off themselves in terms of mandatory UN arms sanctions, while enabling
the apartheid regime to have continued access to high tech products under the
guise of their being "locally produced" or even "locally
developed" (references to Barlow Rand from "The Electronic Back Door:
A brief case history on the involvement of Barlow Rand in the South African
Military-Industrial Complex", Resister, 41, December 1985 and
G.Simpson in Cock and Nathan, 1989).

ii. The National Security Management System

The NSMS was another key institutional inter-face between the apartheid war
machine and the historically privileged business sector. Elaborated in the
second half of the 1980s, the NSMS structures were integral to the whole
"repressive-reform" strategy of the apartheid government at the time.

As Major-General Wandrag, head of counter insurgency in the SAP, explained:

    "The only way to render the enemy powerless is to nip the revolution
    in the bud by ensuring that there is no fertile soil in which the seeds of
    revolution can germinate" (ISSUP Review, October 1985, p 15).

The NSMS structures identified "oil spot" townships, in which they
hoped to launch "elite" development projects that would help build a
buffer social stratum amongst black township dwellers. Lacking sufficient
resources for the "oil spot" programme the military was anxious to
draw in the private sector.

Many in the private sector were happy to oblige. Fred du Plessis, chairperson
of Sanlam, and a leading advisor to P.W.Botha, spoke in 1988 of the necessity of
delivering certain economic benefits to key sectors in the black community, in
order to distract black people from their political aspirations. He spoke of
"...a situation where people ten years from now feel things are going so
much better for them that they do not feel anxious about political power"
(Business International, 1988).

Leading business personalities and corporations shared the Total Strategy
ideology with the regime, and supported the notion of "repressive
reforms" that were integral to it. The institutional co-option of the
private sector was particularly a feature at the local level, in the Joint
Management Committees (JMCs).

The Port Elizabeth community liaison forum, working under the Port Elizabeth
mini-JMC, provides some idea of the functioning of the system. Apart from key
SADF and SAP command structures, there were 27 members of the forum from the
private sector, including the Master Builders' Association, Assocom, the Midland
Chamber of Industries, the Port Elizabeth Chamber of Commerce, the Small
Business Development Corporation, the Afrikaanse Sakekamer and the NGK.

The major decision of the forum appears to have been the construction of a
"major sports centre at Kwadwesi - a new prestige neighbourhood". The
focus on a "prestige" black neighbourhood, in a city racked with high
levels of unemployment and poverty, was typical of the NSMS orientation
(information on the NSMS and PE liaison forum from K.Phillip in Cock and Nathan,
1989).

iii. The Defence Manpower Liaison Committee (Demalcom) and Conscription

Until 1982 the SADF and the business sector discussed strategic issues around
"manpower utilisation" in the Defence Advisory Council. This body was
then replaced by the Defence Manpower Liaison Committee, whose task was to
"promote communication and mutual understanding between the SADF and
Commerce and Industry with regard to a common source of Manpower" (Defence
White Paper, 1982). In addition to the personnel from the various arms of the
SADF, 21 employers' organisations were represented on the Committee.

Similar Committees were established at provincial and regional level. The
Johannesburg Committee included representatives from the SADF's Witwatersrand
Command, the Randburg Commando, the Johannesburg Chamber of Commerce, the
Johannesburg City Council, the Randburg Town Council and Chamber of Commerce,
the Transvaal Chamber of Industries, the Security Association of South Africa,
the Engineers' Association of South Africa, the Institute of Bankers, the Anglo
American Corporation, and others.

These Committees dealt with a range of issues eg.

  • they planned conscription intakes
  • they drew up guidelines for companies regarding staff conscripted into the
    SADF.
  • the Committees were involved in the State's attempts to control labour; in
    particular labour involvement in the liberation struggle.
  • "We put everything under the hat of labour. The brain drain, labour
    unrest, stayaways - so, for example, we would go to the organised sector and
    say, 'You can expect trouble on the following days' - say, for example, on the
    16th (that's a bad day to pick!) - to give them time to adjust, and pre-empt
    unnecessary hardship and firings, by giving clear guidelines to workers. It
    could be a small business - he doesn't read the papers, he's not aware - so by
    warning him, he can buy stock early, make sure his salesmen aren't on the
    road, and so on." (Col. Du Toit, Chairperson of the Johannesburg
    Committee quoted in Cawthra, 1986).

  • The Committees provided the cover for the involvement of the SADF in
    Township development.

Again Col. Du Toit:

    "The support of the private sector is given in the form of allowing us
    to use the expertise and knowledge that they have so much of. The idea is not
    to look for funds from them, because that's not on, but to get them to
    appreciate that we need their expertise. One way of getting such expertise is
    by conscripting it, and some skilled conscripts have been called up and placed
    in ostensibly civilian positions where their skills are needed. So for
    example, the army is involved in Alex, then they would call up an engineer,
    and say to him, 'You are going to work in Alex for such-and-such a company'
    I'm not going to say a name. Then the army would use his technical skills in
    this way. In the building trade, this approach has been very successful. These
    guys don't wear uniforms, they just work in the company, and they are credited
    with their call-ups." [ibid]

  • The Committees were given intelligence briefings "to place
    controversial subjects into the "correct perspective".

Following Demalcom guidelines, companies began topping up the low salaries
paid to national servicemen. Many continued to pay full salaries to their
conscripted staff. Some also paid employees who volunteered for extra military
duty. Companies thus facilitated conscription, and their payments amounted to a
large subsidy for the SADF. They also gave their staff paid time off during
commando service.

One researcher, writing in 1988, estimated that "most private companies
currently do this, and ...one fifth continue to pay full salaries" - even
though there was no legal obligation to do so (Phillip in Cock and Nathan, 1989,
p 211).

iv. National Key Points - the privatisation of repression

The National Key Points Act of 1980 created another network of collaboration
between the apartheid security forces and the private sector.

Moving the second reading of the National Keypoints Bill, the apartheid
Deputy Minister of Defence, said:

    "At the moment the Republic of South Africa finds itself in the midst
    of an unconventional war which up to now has been of relatively low intensity.
    However, it may be expected that in the future the terrorists onslaughts will
    increase both in frequency and intensity....The private sector is in the front
    line of a terrorist onslaught. The enemy threatening us can best be combated
    by a calm and determined Government, public and business community..."
    (Hansard, 12 June 1980)

Hundreds of installations and areas were designated as National Keypoints in
terms of the legislation including mines, power stations, oil refineries and
various factories. Owners were required to provide and pay for security as well
as set up security Committees jointly with the SADF which included recommended
private security consultants. Provision had to be made for the storage of arms
on the premises.

The effect of this legislation was:

  • to shift some of the financial burden and responsibility for
    "national security" onto the private sector, releasing apartheid
    security forces for other activities; and
  • to create, as the Financial Mail pointed out at the time, a
    "multi-million rand bonanza" for the private security industry. By
    1983, the private security industry had an annual turnover of R 1.000
    million, and comprised over 500 companies (Phillip in Cock and Nathan, 1989,
    p 213).

The required appointment of private security consultants, and the use of
private security companies to guard national keypoints led to the integration of
state and private sector security companies with a uniform security strategy.
The militarisation of South African security companies is evident to this day.
Many senior personnel from the state's security establishment joined private
companies on retirement.

White employees and occasionally "reliable blacks" were organised
into industrial commandos attached to industrial plants, groups of factories or
industrial areas. Training and deployment was undertaken jointly by management
and the SADF.

Publication of information on keypoints was prohibited, and subsidiaries were
even prohibited from informing parent companies that their installation had been
declared a keypoint. Other legislation prevented many private sector companies
from providing information about trading partners, sources of supply,
production, etc.

To Sum Up: While the growing militarisation of our society in the late 1970s
and through the 1980s constituted a huge drain on resources, thousands of
private sector companies were happy to reap profitable private benefits for
themselves. No doubt there were disadvantages for the private sector as a result
of the increasing conscription of white males, and the growing need to spend
large sums of money on company security. Despite occasional complaints about
such "irritations", the track record of the private sector in the
growing militarisation of South Africa through the 1980s was generally one of
greedy collaboration.

Craig Williamson told the TRC special hearings on security forces that
privileged business was more than willing to provide logistical support for the
regime's covert operations. He said covert units never had any trouble obtaining
from private sector suppliers equipment needed in covert operations, including
"unconventional" supplies such as false credit cards.

What is more, leading personalities from the business community played a
proactive role in the process of militarisation. Many of them helped to
elaborate and propagate the "repressive reform" ideology that
underpinned militarisation and its guiding philosophy - the total strategy.

We call on the business community both to acknowledge its role in the
militarisation of our country, and to indicate precisely what relationship it
had with covert units of the apartheid state responsible for gross violations of
human rights.

6. Business and the Apartheid Nuclear Weapons and CBW Programme

The secret nuclear weapons programme undertaken by the apartheid regime would
not have been possible to implement without the direct participation of
business.

In 1975 the ANC alerted the international community to Pretoria's intention
to build nuclear weapons and its attempts to acquire the relevant technology.
The ANC's document, "The Nuclear Conspiracy" (annexed), provides
information on the regime's intentions as well as documenting some of the
international collaboration in the nuclear programme. Further information was
provided to the United Nations including evidence that the regime considered it
"safe" to use tactical nuclear weapons in the region.

Though denying our evidence at the time, the apartheid government admitted in
1993 that it had built nuclear weapons ("devices") and tried to focus
attention and gain credit through its decision to dismantle these.

The ANC calls on the TRC to establish who took the decision to build these
weapons and what were the intentions on their use. We further request the TRC to
investigate the culpability of the many South African companies and scientists
who participated in this heinous programme

It is widely recognised that South Africa under apartheid was also involved
in clandestinely developing both a chemical and biological warfare capacity, as
well as a missiledelivery system for that purpose. As part of these activities,
the SADF established a number of front companies such as Delta (G) Scientific
and Roodeplaat Research Laboratories, amongst others, which were privatised
prior to the 1994 elections. The extent of business involvement in such
programmes remains an open question that needs further investigation. It has
also been revealed that while the programme had largely a defensive capacity,
there was an offensive aspect which was allegedly utilised against
anti-apartheid opponents as well as some neighbouring states.

7. Business and Sanctions Busting

South African and international companies were involved in breaking the oil
embargo and the laws of a number of countries. National and multinational
companies continued to supply fuel to the SADF notwithstanding protests from
their shareholders (international) and representations from the ANC. They
justified their actions by claiming they were forced to do so by the laws of
South Africa.

Much of the corruption and lack of morality that prevail in our country today
owes its origin to these practices and other covert activities of state agencies
as well as systematic sanctions busting by business interests promoted and
assisted by the regime through secrecy provisions and legal protection provided
to those who violated the laws of other countries. State agencies, commercial
and financial institutions were involved, as well as international criminals who
were often welcomed and given sanctuary in South Africa.

Multinational corporations participated with South African companies in all
the activities to which we have referred. Rarely did they voluntarily dissociate
themselves from involvement in apartheid. Among the notable exceptions are the
Volvo Group in Sweden and Wates Construction in the UK.

Under pressure to disinvest from their shareholders and anti-apartheid
movements in their home bases, other companies justified their continued
involvement on the grounds that staying in South Africa helped black South
Africans. They did not address what they could do to stop being drawn into the
repressive state machinery deployed to defend apartheid.

Responding to these arguments, the late President of the ANC, Oliver Tambo,
said in May 1987.

    "It is difficult for us to accept the argument of business both inside
    and outside the country that it is politically impotent. Business has chosen,
    until now, to align itself with and benefit from the economic and military
    state that is part of the apartheid system. With apartheid universally
    condemned and disinvestment and sanctions vigorously resisted, international
    business has turned to justify its presence by promising to provide so-called
    neutral support in the form of black education, housing and welfare...the
    issue is not simply about black education, housing or welfare, notwithstanding
    that these are grossly neglected by the apartheid State. The point is that
    such neutral support will always be compromised by the apartheid system
    (and)... such neutral support will further enmesh international business in
    the apartheid system....It has become far more urgent that they define their
    political alignment. This, necessarily, means that corporations have to
    distance themselves from and resist the short term pressures that lock them
    into Pretoria's embrace. It is our firm view that the true interests of the
    business community lie not in continuing to identify with a system doomed to
    disappear, but to relate to the forces for change which are destined to take
    charge of the socio-economic life of a non-racial, democratic South Africa.
    Such a perspective is, in our view, the only way to peace, stability and
    progress not only in South Africa but the entire Southern African region"

8. Business' Role in Seeking a Negotiated Settlement

In previous sections of this submission, we indicated how during the early
years of the Botha government close ties of collaboration were forged between
important sections of the privileged business community and the apartheid
regime. The "reformed apartheid" project and the "total
strategy" of P.W.Botha attracted a good deal of support from business
circles that reached beyond the historical support base of the National Party.

It should be noted that the bottom line of P.W. Botha's "reformed
apartheid" remained throughout an unwillingness to contemplate any move
beyond racial minority rule. Every reform introduced by Botha was intended to
shore up rather than undermine minority rule, and when reforms failed to produce
a new support base in the black community the regime fell back on repression.

Despite business' retrospective claims that it was always at the cutting edge
in seeking democratic reform in South Africa, there was, in fact, a good deal of
common ground between leading business circles and the Botha regime over the
ultimate objective in seeking "reforms" that would draw historically
oppressed communities into a new political dispensation while at the same time
preserving ultimate control by the white minority.

Former Anglo American Corporation chairperson, Gavin Relly, is on record
pronouncing himself "not in favour of one-man, one-vote in South
Africa", because that "would simply be a formula for unadulterated
chaos at this point in time in our history." (quoted in Kanfer, 1993, p
347). Anton Rupert of Rembrandt said in 1981, "After many African countries
became free they got dictators like [Idi] Amin's. We have to find a solution
that won't end up giving us one man one vote." (quoted in O'Meara ,1996,
p.187). And the doyen of corporate South Africa, Harry Oppenheimer, told
"Business International" in 1980,

    "Since we're not going to get the Nationalists out of power so quickly
    - much as I'd like to see the Progressive Federal Party come in - one has got
    to find a means of doing social justice in a way that the reasonable people in
    the National Party might go for. This does shut out going for one man one vote
    in a unitary state, although clearly one's got to go for one man (sic) one
    vote in some form. I used to be very keen on a qualified franchise, but it's
    no longer practical. I think therefore one should go for everybody voting in
    some sort of federal society. We have to go to look for our salvation to that
    fascinating business of constitution making" (quoted in O'Meara, 1996, p
    187).

As argued in section 5 above, the years immediately following P.W.Botha's
accession to power saw an unprecedented level of practical cooperation between
business and the apartheid regime at a number of levels, including over the
militarisation of our society. The 1979 Good Hope and 1981 Carlton conferences
appeared to have had the effect of winning over many leading business
personalities. Mr Harry Oppenheimer, said at the Good Hope conference that he
saw "greater reason for real hope in the future of the country than I have
felt in many years" (quoted in O'Meara, 1996, p 294). Business
personalities from outside the ranks of the historic support base of the
National Party accepted being drawn in to a range of advisory bodies and
parastatals and commentators spoke of the Botha regime resting on an alliance
between business and the military.

We acknowledge that this began to change in the mid-1980s when the combined
pressures of mass action and international isolation made Botha's project of
reformed apartheid unworkable. In the context of a deepening political crisis
that was beginning to take a real toll on the economy, a number of important
leaders from the historically privileged business community began to "break
ranks" and contemplate a negotiated settlement that reached beyond the
parameters of "reformed apartheid" some time before politicians from
the ruling party were willing to do the same. We regard this as a positive
development in the history of our country, and believe that the visits to meet
with the ANC in Lusaka and elsewhere as well as the various
"post-apartheid' conference and scenario activities initiated by business
in the late 1980s on balance contributed to an eventual democratic settlement in
our country.

At the same time, we believe that it is important that an accurate account
emerges of this process. The Botha regime's rejection of pressures to negotiate
an acceptable transition to democratic rule in 1985 was followed by the
imposition of states of emergencies, the escalation of assassination campaigns
against anti-apartheid activists within the country and abroad and further
destabilisation of neighbouring countries. It was during this period that some
of the gravest violations of human rights occurred. While significant groupings
within historically privileged business began to grope towards the idea of a
negotiated democratic transition, considerable vacillation was evident and
leading personalities from major corporations continued simultaneously to give a
degree of political support to the Botha regime's states of emergencies.

It is our view that until the latter part of 1984, relations between
historically privileged business and the Botha regime remained generally warm.
When "reformed apartheid" appeared to be viable, it attracted a good
deal of support from business circles. The campaign for a 'Yes Vote' in the
November 1983 referendum on the proposals to establish the tri-cameral system
was enthusiastically supported by many corporate leaders. The Nkomati Accord
signed with Mozambique in March 1984, whose principal objective from the South
African government side was to secure the expulsion of the ANC from Mozambique
and Mozambique's subjection to South African hegemony, was also warmly welcomed.
Many leading business personalities were invited to the Nkomati ceremony, and a
number of these expressed both support for the political objectives of the Botha
regime in Southern Africa and an interest in exploring the possibilities of
themselves becoming involved in "making the new relationship work".
Typical of the mood of the time was the following statement by the Chief
Executive of Assocom. In April 1984, he said,

    "Most businessmen today - in the aftermath of the Nkomati
    Accord...stand closer to the Prime Minister's goal than ever before" (The
    Star,
    25/4/1984).

It was only as the regime's incapacity, firstly, to resolve the worsening
domestic crisis and, secondly, to capitalise on the Nkomati Accord, became
evident that relations began to become strained. Some signs of such strain were
evident in November 1984 when the arrest of trade unionists involved in the
'stay away' strike of that month led six leading business organisations to
submit a memorandum complaining that the regime's heavy-handed action was
threatening to undermine industrial relations. The same month also saw
expressions of disquiet at the regime's double dealing with Mozambique - which
was confirmed a few months later when the "Gorongosa documents"
captured at Renamo headquarters showed beyond any doubt that SADF support for
Renamo's armed campaign had continued despite the Nkomati Accord.

By the beginning of 1985, serious criticism was also being voiced of the
handling of the deepening fiscal crisis of the apartheid state. In January 1985,
The Star summed up the views of leading businessmen on this as follows:

    "For the first time in the country's long history the feeling is
    increasingly growing that things have got out of hand and that the government
    - in the visible form of [Finance Minister] Mr du Plessis - simply has no
    answers..."

Talk of the end of the 'spirit of Carlton and Good Hope' began to be common
and by mid-1985 a variety of 'plans' and 'programmes' for a 'settlement' began
to emerge from business circles. P.W. Botha's 'Rubicon Speech' of August 15th
1985 provoked a major rupture. The Sunday Star wrote:

    "Business leaders who normally support President Botha were
    'shattered' by his speech...His speech, watched by millions globally, ended
    any remaining cosiness between business and the government, built up after the
    Carlton and Good Hope conferences..."

On September 13 1985, a group of leading business personalities travelled to
Zambia to meet with the leadership of the ANC. The delegation included Gavin
Relly, Chairman of Anglo American; Tony Bloom, Chairman of Premier Milling and
Zach de Beer of Johannesburg Consolidated Investments. This meeting took place
despite strictures from Mr Botha about 'disloyalty' and went a long way to
establishing recognition within the then dominant minority community of the
reality that there could be no solution to the crisis of legitimacy that
excluded the organisations of the historically oppressed.

The ANC welcomes and acknowledges the fact that business broke ranks with the
Botha regime in this way, and believes that it contributed to creating a climate
within the privileged minority community more receptive to genuine, inclusive
negotiation. At the same time, we feel obliged to point out that in the
mid-1980s this break was not yet absolute. Much of the negative reaction to the
Rubicon speech was because it was feared (rightly in the event) that it would
provoke an international reaction that would harm business. This materialised in
the form of the refusal by foreign banks to "roll over" South Africa's
international debt. The Reserve Bank, however, intervened and secured a debt
standstill agreement. Although this imposed a tight repayment schedule, it did
succeed in avoiding the devastating consequences that would have followed had
the foreign banks insisted on immediate repayment. At the same time, the Botha
regime's states of emergencies appeared towards the end of 1986 and 1987 to be
reducing the level of mass action against the regime. In this context, and at
least until the cyclical downswing of late 1988 and events in Cuito Cuanavale,
the immediate threat appeared to recede. Seeking change appeared, in this
context, to have become a less urgent priority and a partial return to
"business as usual" became evident between 1986 and 1988.

In this context, prominent forces in the historically privileged business
community gave open support to government's imposition of a country wide state
of emergency in June 1986. By early 1987, 30.000 activists had been detained.
Numerous reports of torture, murder and security force abuses had emerged
despite restrictions on reporting of "unrest". Nevertheless, Gavin
Relly in his 1987 Anglo American Chairman's Annual Statement said,

    "The imposition of the State of Emergency last year, and its recent
    renewal, though regrettable, were necessary ...It would be foolish to pretend
    that communities exposed to violence have not benefitted...or to deny that
    many South Africans prefer a state of affairs in which their attention is not
    drawn constantly to the realities of the nation's problems" (Anglo
    American Corporation, 1987, p 2).

Trust Bank, in an otherwise generally depressed review of the economy in
October 1988 said:

    "The 60 percent increase in South Africa's security expenditure over
    the past two years was clearly essential in the circumstances. In fact, the
    damper put on socio-political instability by the security forces has
    definitely played a role in the recently improved performance of the
    economy."

While acknowledging and appreciating the positive role of business in
initiating a move towards seeking a negotiated democratic settlement, we
nevertheless call on business to acknowledge that it provided a degree of
political support for repressive measures that formed the legal cloak for many
gross violations of human rights in the late 1980s. We regard it as a
particularly serious indictment that at a time when probably the most serious
violations of human rights in our country's history were occurring, business
leaders not only refrained from making any significant protest but were indeed
prepared to endorse to some degree the ongoing repression. We believe that it is
not just the foot soldiers of apartheid that need to accept responsibility for
its crimes, but also the political leadership and the captains of industry whose
acts or omissions created the climate that made those crimes possible.

9. Business and Violence in KwaZulu-Natal

The violence that erupted in various parts of our country both before and
after the unbanning of the ANC and other organisations is a matter of deep
concern to all those with the interests of our country at heart. The ANC has
long maintained that the roots of much of the so-called "black on
black" violence can be traced back to "third force" elements
operating in the apartheid state's security forces. We acknowledge that the
business community has at various stages of our transition, and particularly
after 1990, participated in conflict resolution and other peace initiatives. The
ANC appreciates these efforts. At the same time, we feel obliged to indicate
that a number of attempts by the ANC and Mass Democratic Movement to involve
business in peace initiatives did not at critical moments result in an adequate
response.

We are also concerned about a number of allegations made over the years about
business support for JMC and covert operations units of the apartheid security
forces in KwaZulu Natal. Among others we believe it is important to establish
the relationship between business and JMCs/covert unit structures in the
following cases:

  • At Mooi River at the time of the outbreak of violence in the township and
    at the Mooi River Textiles factory in 1990;
  • at BTR SARMCOL in Howick and RBM at Richards Bay and Empangeni; and
  • The circumstances under which Tongaat Hullet rented out the farm Waterloo
    in the Verulam area to security force agents. The body of murdered activist,
    Phumezo Mgxiweni, was unearthed on this farm by the TRC earlier this year.
    At the time, ANC MP, Blade Nzimande, referred to the unusual circumstances
    under which the farm had been leased and called for a full investigation
    into the role of Tongaat Hullet in this.

10. Conclusions

We have argued in this submission that the historically privileged business
community was a beneficiary of a system in which white privilege and black
oppression were the two sides of the same coin. We have tried to show that for
many years after 1960 historically privileged business as a whole, as well as
particular parts thereof, remained involved in varying degrees in the active
promotion of discriminatory measures as well as continuing to benefit from those
introduced in earlier periods. It was not just laws and regulations imposed by
the apartheid state, but business' own discriminatory practices that contributed
to the creation of the highly skewed distribution of income, wealth and
opportunity that we are forced to grapple with today. It is also our contention
that significant sections of the privileged business community, reaching well
beyond the traditional support base of the ruling NP, actively collaborated in
promoting the programmes and policies associated with the Botha government's
"total strategy". Not only were important business leaders and
corporations actively involved in the militarisation, but gave a degree of
political support to repressive measures and acts of military aggression
implemented by the apartheid state.

We readily concede that not all of the measures of apartheid were sought by
business. We also acknowledge that as the apartheid system became increasingly
dysfunctional to business from the mid-1980s onwards, a number of historically
privileged business organisations (including some of those close to the then
ruling party) began to grapple for solutions that reached beyond the parameters
apartheid political leaders were then prepared to contemplate. The role which a
number of leading business personalities and organisations played in promoting
dialogue and negotiation at the end of the 1980s, we judge to have been a
positive contribution to bringing about a transition to democracy in our
country. This cannot, however, detract from the reality of a record of extensive
collaboration by business with a system involved in gross violations of human
rights.

We make a plea to business to confront its past, not as an exercise in
historical debate. We believe that acknowledging past injustices is the key to
reconciliation. Specifically we believe that the acknowledgements we have called
for in this submission should be a spur to action. We call on historically
privileged business organisations to recognise that genuine reconciliation
requires addressing the inequalities, inequities and developmental backlogs that
the system of discrimination, from which they benefitted in varying degrees, has
left as the heritage of our new democratic order. If these hearings produce a
new commitment on the part of business to work together with government and
other stakeholders to overcome problems of inequality and underdevelopment, they
will, in our view, have been worthwhile.

REFERENCES

Anglo American Corporation (1987), Chairman's Statement, Johannesburg.

Asmal, Kader, Louise Asmal and Ronald Suresh Roberts (1996), Reconciliation
through Truth: A Reckoning of Apartheid's Criminal Governance,
Claremont,
David Phillips.

Business International (1988), Apartheid and Business, London.

Cawthra, Gavin (1986), Brutal Force: The Apartheid War Machine,
London, International Defence and Aid Fund.

Cock, Jacklyn and Laurie Nathan (ed) (1989), War and Society: The
Militarisation of South Africa,
Cape Town, David Phillip.

Davies, Robert (1979), Capital, State and White Labour in South Africa
1900-1960,
Brighton, Harvester Press.

Davies, Robert, Dan O'Meara and Sipho Dlamini (1985), The Struggle for
South Africa: A Reference Guide to Movements, Organisations and Institutions Vol
1,
London, Zed Books.

Defence White Paper, 1982, Pretoria.

Grundy, Kenneth (1988), The Militarisation of South African Politics, Bloomington,
Indiana University Press.

Kanfer, Stefan, (1993) , The Last Empire: De Beers, Diamonds and the
World,
London, Hodder and Stoughton.

O'Meara, Dan (1983), Volkskapitalisme: Class, capital and ideology in the
development of Afrikaner Nationalism 1934-1948,
Cambridge, Cambridge
University Press.

O'Meara, Dan (1996), Forty Lost Years: The Apartheid State and the
Politics of the National Party, 1948-1994,
Quadrangle, Athens, Ohio
University Press.

Webster, Eddie (1983), "Background to the Supply and Control of Labour
in the Goldmines" in E.Webster (ed), Essays in Southern African Labour
History,
Johannesburg, Ravan Press.

Wilson, Francis (1972), Labour in the South African Goldmining Industry, Cambridge,
Cambridge University Press.

Periodical Publications:

Business Day

Financial Mail

Hansard House of Assembly Debates

Issup (Institute of Strategic Studies University of Pretoria) Review

Resister

The Star

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Weekly Mail and Guardian