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They had also failed to define the goals of transformation, which had to be about more than changing the colour of a narrow elite, NPC secretariat head Kuben Naidoo told delegates to a conference organised by the FW de Klerk Foundation. The conference was held to commemorate the 22nd anniversary of the former president’s speech that opened the way for the constitutional talks on a democratic SA.

Mr Naidoo's candid comments were in line with the refreshingly critical appraisal of the state of SA in the NPC’s national development plan, released in November.

"My view is that both government and the private sector have erred in their implementation of redress measures. The Employment Equity Act does not say that firms or the public sector should appoint people who do not meet the required criteria for a job. Yet this happens across the economy," Mr Naidoo said. This was not to suggest, however, that affirmative action was not essential to redress the effects of apartheid, he added.

Mr Naidoo said businesses were also shirking the task of training staff, spending less on this than they did 20 years ago and less than in any comparable developing country.

The government had also been at fault, with the collapse of the financial services charter being a good example, he said.

"In the charter, the banks had targets on low-cost housing, the introduction of Mzansi accounts, infrastructure lending and black and female managers. In turn, the charter had lower equity ownership targets. In the end, we ended up with higher ownership targets with all the other elements thrown out of the window. So the 9-million Mzansi accounts that were opened are now gradually being closed … because banks are not prepared to cover the costs. This is not economic transformation. It is merely rearranging the deck chairs," he said.

Implementation of the Preferential Procurement Act had been used to foster crony capitalism rather than economic transformation.

Mr Naidoo emphasised that the NPC’s national development plan would "not be worth the paper it is written on" unless the capability of the state was strengthened. The plan would be resubmitted to the Cabinet in May for implementation.

Adcorp CE Richard Pike criticised industry-wide wage agreements struck through collective bargaining and restrictive dismissal procedures as two of the main constraints on job creation.

Business would rather automate or relocate than employ more labour and was substituting labour en masse. Workers should be given the choice to opt out of wage agreements if they wanted to work at a lower wage, he said.

Mr Pike warned that about 500000 of the 3,9-million contract workers - 900000 of them using labour brokers - would lose their jobs if labour brokers were banned as the Congress of South African Trade Unions wanted. He believed the reason for the federation’s stance was a bid to boost its dwindling membership by having contract workers made permanent employees.