Mining charter ‘fails the people’

Two neighbours, the royal Bafokeng community of the platinum-rich Luka village in the North West and Impala Platinum Holdings Limited (Implats), have for years had an uneasy relationship – lack of trust, dishonesty and no harmony.

The Bafokeng have hosted Implats on their land where the company’s mining operations are based, with the community expecting much in return – jobs, development and business opportunities – all in line with the Mining Charter.

At the core of the Mining Charter is the promotion of transformation in the sector.

It also gives recognition to communities who live near mining operations, as being among key stakeholders who should be engaged and empowered through preferential procurement.

Lee-Anne Bruce of the Centre for Applied Legal Studies has argued that – despite the Mining Charter being intended as a tool for addressing inequality and promoting transformation in the mining sector – it had “a history of being developed without engaging the very people it is meant to benefit: mining-affected communities”.

“Despite this, the public participation process on the new Mining Charter in the months that followed was inadequate.

“Task teams on the charter did not feature community representation, with consultations with communities set up with little notice in unclear venues – without enough room to accommodate everyone,” said Bruce.

The mining series published this week, has pointed to:

• A poverty-stricken Luka community, unhappy about lack of development around them – some living in corrugated iron structures, where there are more taverns than schools and clinics; and roads full of potholes.
• Lack of business opportunities for locally based entrepreneurs, some of whom have been short-changed by Implats.
• Mining management who – despite charges of noncompliance with the Mining Charter – have refuted the claims, reassuring on putting local communities as their first priority.

Independent political analyst Ralph Mathekga and mining expert Johan Lorenzen, associate at Richard Spoor Attorneys, have blamed government for failure to hold Implats to account.

“The Mining Charter has failed the people and government could not enforce it,” said Mathekga. “Policy development needs to be closer to communities than government.”

Lorenzen argued that South African mining was likely to bring poverty rather than riches to communities that host mining operations.

“It all starts with the state’s lackadaisical approach to community consultation and consent,” he said.

“While the law expects much more, the state routinely gives mining rights over community land, where the only consultation is one or two general meetings held by environmental consultants.

“This immediately puts communities at disadvantages in negotiating fair compensation.

“This is particularly a problem because fair compensation for communities is complicated. It requires much more than a simple market valuation.

“Due to our racist history, the market value of community land is rarely high. But the impact of losing land can be immense for communities.

“What is required is recognising that communities have free, prior and informed consent before mining happens on their land.

“The informed element is important – there needs to be detailed information on how mining will impact communities.”

Until 2019, the Mining Charter was “simply not set up to empower communities”.

“There was no obligation to involve communities in the [black economic empowerment] shareholding requirement,” said Lorenzen.

“Where communities were involved in the shareholding, the shareholding would be financed through debt without any meaningful negotiation with the community.

“Servicing this debt often takes years, particularly where the majority shareholder shifts profits through management fees and other tactics.”

The Bafokeng North-A Economic Forum (Banaef), has given Implats seven days to respond to its concerns, which included that a forensic audit be conducted and Impala personnel implicated in obstructing transformation be investigated.

Banaef said a credible, internationally recognised company has already stepped in and offered to help the community of Luka in conduct the forensic audit.

“It will be prudent and honourable for the shareholders and leadership of Impala to cooperate and give the access to information for the exercise to take off and be completed,” said Banaef president Rony Mekgwe.

– brians@citizen.co.za