Special Hearings — Business Hearings — 1997-11-13

PROF SIMKINS: Thank you, Mr Chairman.  I'd just like to make a few comments under four or five broad headings, either occurred to me in relation to today's proceedings and indeed to the proceedings in general.
 Firstly, to remind ourselves that really the core project of the Truth and Reconciliation Commission, was to identify gross violations of human rights as defined under the act.
 For something to be a gross violation of human rights it had to satisfy two criteria.  It had to be either murder, torture, abduction or several treatment and it had to be done for a political purpose.
 Gross violations of human rights in these terms were in fact illegal when they were committed, but the TRC is part of a wider process under which amnesty could be applied for and granted if the conditions were met by applicants.  
 It has the further implication of shutting off, if you like, a recourse by victims through the court and therefore an alternative route of establishing a fund for compensation and reparation.
 Now, the hearings on business as I indeed - I think the hearings on the health system and on the legal system, are to some extent an add on and they take the TRC into another role which also has a great deal to do with human rights, but is less well defined than gross violations of human rights under the act.
 If we're talking about violations of human rights we consider a whole set of other things which may have been - which would have violation of human rights, but in some sense less serious than the gross violations.
 Secondly, this business of having to be done for political motives, largely falls away.  In so far as business violated human rights, the main reason would have to do with the core objective of business which is to make profits.
 So it would have been in the interest - in the economic interest of business, not necessarily in political interest.
 I think when we broaden the scope like this, we have a couple of important questions to which the Commission will need to pay attention.
 The first is, just try and get some notion of what human rights ought to have been under the period under review.  Are we going to use the post 1994, the human rights as defined in our final new constitution or are we going to use some other yard stick, particularly in relation to those human rights which actually depend on the level of the wealth of a society.  
 Then I think also that you, one would have to erect criteria for distinguishing between a violation of a human right and the frustration of a demand.  People may have demands and interest which they have the right to try and satisfy, but it's not human right if they're not fully satisfied, a human right is not violated.
 So, I think, these two areas are going to be quite important in - if you like - taking the Commission beyond its core project and you will have to think about these issues in relationship to writing up this particular section.
 The other thing I want to say about this head is that what our political transition has done, has been very important and it is removed racial discrimination from public policy and from our legislation and that's been the most significant political development of the century.
 But of course it has not removed every source of conflict from our society.  Scarcity remains - economic scarcity remains and so there's always competition for economic goods.  And, if you like, class conflict, if we may use that rather now, rather an old fashioned term, remain.
 Those things have not been abolished by our political transition and we need to understand what remains and what has disappeared in our discussion.
 The second broad heading I'd like to talk under is this question of the composition and heterogeneity of business.  Some speakers have said this is not a very important issue, but I think that would be a mistake.
 I think the hugely complex composition of South African business is important for at least three reasons.  Firstly, if you don't understand the heterogeneity of business, you don't understand the different interests and the different behaviour of parts of business and that's pretty important to understand.
 Secondly, I don't think you can understand the degrees to which business met, if you like, its moral obligations.  That depends on the structure and the location in the structure of business that that particular agents occupied.
 Thirdly, if you don't look at the heterogeneity of business, you can't understand the capacity of business to contribute now to the building of our society or to the modalities through which it can make a contribution.
 Now, when you look at heterogeneity of business, I'm going to suggest very briefly, three dimensions you might look along.
 The first has to do with the size of business and businesses market power.  We have very small businesses, we have one person businesses ranging from micro-enterprise in formal sector right up to very large and powerful corporations which have very substantial amounts of market power.
 The obligations of businesses with market power who could determine at least to some extent, the market environment from which they operated, are different from businesses which are essentially price takers to which - in which all activity is directed to earning a normal rate of return on capital.
 The second dimension that one has to look at, is perceptions of business and expectations about the future.  It's one thing to look back at the record of business from our current perspective, our perspective of late 1997.
 It's another thing to think about business actions in the light that businesses themselves would have had regard them in the 1960's, in the 1970's, in the 1980's, where they could merely make conjectures about the future.
 And I think this question of expectations about the future is terribly important.  The literature on political and economic change suggests a fairly common sense classification which will be important here.
 In an environment which demands change you can have three broad sorts of responses.  Firstly, you can have the stand patters.  The people who want to maintain the present system, who are going to try and stick with what they have for as long as possible.
 At the other end of the extreme, you have the innovators.  The people who are looking for change, who are trying to find ways of innovation and are exerting themselves to the utmost under the constraints they face, to innovate.
 In between those two groups of people, you probably have the biggest class;  that is of pragmatic adaptors and I think some of things we've seen and heard today, have been the responses of pragmatic adaptors. 
 Now, pragmatic adaptors on the whole would stand pact for quite a long time, but when they see the change is inevitable they will shift their position and adapt to new circumstances.  Their heart may not be in it a great deal, but they make a pragmatic decision to adapt.
 If you look at South African business responses, to the pressures on it in the period since 1960, you'll find people falling in each of these categories and indeed within businesses there may have been different responses at different times, but these expectations about the future, I think, are essential in evaluating the extent to which business met its moral obligations in South Africa.
 The perceptions, they're beyond business in fact.  They're very important in relation to COSATU's evidence and what we have to say here is, that the evidence of today says, that, right now in 1997, let alone what happened in the past, people do see things in very different terms.
 And implicitly in the way that they asses their contribution, is the idea of a counterfactual of what might have been if Apartheid had not been.
 I think there is a chasm between business and certainly COSATU on that.  That would be important to talk about in assessing contributions.
 Thirdly, business was heterogeneous and very heterogenous in its relation to the State, between 1960 and 1994.  Closest to the state were the parastatals.  The parastatals very often structured park your wholly along civil service lines, closely subject to Government direction.
 Beyond them you might then identify what you could call the "Binnekring" private sector Afrikaners.  The people who were close to the Government who were in the private sector, are connected to the Government by cultural associations in the light and having at all times close accessibility to meet - to seeing officials and cabinet ministers and to engage in discussions with them.
 Beyond them you have Afrikaners more generally and also White English speaking business.  Certainly in important ways beneficiaries of the system that applied in that time, although the White English speakers point to and rightly point to ways in which they were disadvantaged, both in the (indistinct) size of the business and at least relative to some of these other groups that I've already talked about.
 The Avalon Cinema contribution this morning reminds us of the particular treatment of a dynamic entrepreneur of community among people known to Apartheid as Asians or Indians, suffered particularly under the group areas act and some of its predecessor legislation in the 1940's and then right outside of that, Blacks subject to huge disabilities to the point in which Black formal business only really start to become a reality in the later Apartheid period, the informal sector in the (indistinct) of the system of course was always there.
 So, these considerations which I've tried to sketch out in broad terms, I think these been brought to bear on the evidence that we've heard today and no doubt in the two days before it.
 The third point I'd like to deal with and this is not dealt with in my submission, is the issue of reparations.
 Closest to the work of the TRC is the formation of the President's fund and the dispersement of compensation to people who suffered from gross violations of human rights who apply for assistance.
 We have seen in the press recently and in recent weeks two quite important contributions in relation to the financing of this President's fund.
 One suggestion has been the financing by means of a wealth tax.  Another suggestion has been the appropriation of some of the capital - some or all of the capital reserves of Sasria, the right insurance company that was formed during the Apartheid period.
 Those are two ideas.  I think there are several more ideas that could be brought to bear on it and I think will have to be brought to bear on it, before this matter can be finalised.
 That's the most important thing.  I would just make a suggestion, Mr Chairman, if I might, it would be helpful if as soon as possible one could get at least a bull (indistinct) estimation of what is required by the President's fund to discharge its obligations, because I think once you start from the expenditure side, then I think some of the financing things will fall most easily into place and I think you might get quite a lot more co-operation if you start with the task and not necessarily with the taxation aspects of it, although that all has to be dealt with by the time we're finished.
 I think there are two aspects of reparations which have been dealt with today and these are firstly, the clear aspect - aspiration on the part of South Africa's workers that there should be greater satisfaction of worker claims than there has been in the past.  So that's one dimension.
 I think also implicit in matter of what we have said around not only this part of the TRC's hearing, is that there's a need for funding of more social infra-structure, much of which I would have to be provided through the public sector, though in partnership with the private sector.
 These two broader sets of claims start to interface actually with Government policy and can hardly be considered without it.  We after all, do have a Government policy - a Government in charge where COSATU is part of it - and a most organised part of its support base.  We do have a Government that's committed itself to the reconstruction and development programme and so these things need to be raised, but they need to be discussed in the light of Government policy.
 There needs to be, if you like, a distinction between the specific things flowing out of the TRC in light of its specific task and then the more general orientation of Government policy and identification in either case of the actors that should be involved in the debates that need to happen.
 The final point, Mr Chairman, that I would like to make in relation, again back to my original submission, is that one of the things - one of the jobs of the TRC was to make recommendations on how we would avoid a repetition of gross violations of human rights and violations of human rights more generally.
 We can rule it out with a great deal of certainty there's no chance of the Apartheid system ever re-emerging the particular historical circumstances which gave rise to that has passed beyond recall.
 I would say that the two things that really have to be focused on here to avoid a repetition of violation of human rights, is firstly, the importance of democratic consolidation.
 Mr Naidoo here expressed himself in very optimistic terms that we already had a mature democracy.  I would beg to differ.  I think the bedding down of democracy is a matter of decades even of centuries and that we have to pay attention to the conditions of democratic consolidation to make sure that we avoid a repetition of the large scale violations of human rights that we've seen in the past.
 The second thing that we have to pay attention is firming up the rule of law.  Now, firming up the rule of law is not the same thing exactly as democratic consolidation.  You can have democracies where the rule of law is rather weak.  In the end if the rule of law becomes very weak, then democratic break down is much more likely and may indeed become inevitable.
 But there is a major concern in South African society at the moment that the rule of the law is far too restricted.  There a whole regions of the country in geographical terms where the rule of law is very weak and there are whole areas of our society which are insufficiently regulated by the laws that we have.  
 So, that extension of rule of the law is the second important thing about repetition.  And so, I think it's not so much a question, if you like, dismantling a set of supports for Apartheid, that has already happened, it's bringing to bear the loads of capital accumulation, of human capital and inspanning it to work for these two goals;  the consolidation of our democracy and the extension of the rule of law in South Africa.
 Thank you, Mr Chairman.