In the emotive discussion about skewed patterns of land ownership and whether expropriation without compensation is the answer, too much time is spent talking about matters which are not in serious dispute. And it is muddying the waters.
Democratic Alliance (DA) Shadow Minister of Rural Development and Land Reform, Thomas Walters, has long indicated that expropriation without compensation (EWC) is a diversion tactic. As the DA is reviewing its own land reform policy, and no doubt other parties are doing the same, it is important to lay out clearly which matters are in dispute and which are not.
Matters which are not in dispute
The skewed patterns of land ownership in South Africa must be addressed.
None, let alone the DA, have argued that the present distribution of ownership is acceptable. In parliament DA Deputy Shadow Minister of Rural Development and Land Reform Thandeka Mbambana passionately argued that there was an indisputable need to right the wrongs of the past.
Land reform policy as implemented by the ANC since 1994 has been a failure.
The failure of land reform has been highlighted in detail, most compellingly in the report drafted by the High Level Panel (HLP).
These two reasons:
a) the skewed patterns of ownership; and
b) the failure of past policy have been used to justify the urgent need for expropriation without compensation. Opponents of EWC, are accused of being unmoved by historical injustice and the slow pace of reform. On the contrary, it is precisely because the DA is cognisant of, and in agreement with the above that we oppose EWC.
Matters which are in dispute
Willing buyer/willing seller is the most serious obstacle to addressing the skewed patterns of ownership.
The conclusions of the High Level Panel (HLP) state that, “experts advise that the need to pay compensation has not been the most serious constraint on land reform in South Africa to date – other constraints, including increasing evidence of corruption by officials, the diversion of the land reform budget to elites, lack of political will, and lack of training and capacity have proved more serious stumbling blocks to land reform”.
So it is imperative on those who support EWC to explain why they are elevating compensation to the most serious challenge facing land reform, when it is not. If the findings of the High Level Panel are in dispute, the data which forms the basis of that dispute should be made available. If there is no dispute, then why are the resources and time of parliament not being used to address ‘the most serious stumbling blocks to land reform’?
Compensation requires greater budget allocation, which we cannot afford.
At the time of the tabling of the HLP’s report the budget for land reform was “at an all-time low of less than 0.4% of the national budget, with less than 0.1% set aside for land redistribution”. This makes it difficult to argue that compensation is a debilitating pecuniary factor.
Furthermore we have calculated that R112-billion can be saved by, among other things, reducing the size of the executive, reducing the number of foreign missions, and running provincial legislatures more efficiently. Even if you want to quibble around the margins of that figure, it’s impossible to argue credibly that there isn’t excess fat to be trimmed in order to put the country’s money where its mouth is regarding land reform. Proponents of EWC need to make a case for why there is enough money to finance a bloated administration but not enough to finance an economically prudent land reform agenda?
Expropriation without compensation requires a review of the Constitution.
Again here I will lean on the High Level Panel’s report. In a submission to the High Level Panel Justice Dikgang Moseneke stated that: “Everyone, whose property is expropriated, must be for a purpose the Constitution authorises and against payment of equitable compensation. The willingness of the buyer and/or of the seller may facilitate a smooth transaction, but does not seem to be a constitutional requirement.”
Justice Albie Sachs’s submission shares Moseneke’s sentiments. It seems therefore that from a constitutional perspective there is a strong argument that there are factors which could reduce the compensation payable, possibly even reduce it to zero in some instances. The question therefore is why the need to review the constitution when its parameters include the possibility of reduced or zero compensation? The only answer in my mind is that proponents of EWC do not want to be bound by any parameters in expropriating without compensation, and wish to be given a wide birth to undermine property rights.
It would be an unfortunate omission if I did not point out that bad policies do not need to be unconstitutional or illegal. Several policies and/or their implementation have failed us with regards to land reform, and most of them were perfectly constitutional. It is right to engage in a heated discussion about whether or not there is a need for constitutional change because it should not be embarked upon lightly. However, from a policy perspective the legal compatibility of EWC with our laws does little to settle the question about whether or not it is good policy. In conversations with investors, farmers, and banks none have mentioned the constitution as the basis for their concern. Rather what plagues them are potential losses on investments made, risk to the financial system due to the loss of land as collateral on loans, and the need to put potential developments on hold.
The state should be the custodian of land.
The EFF has proposed that parliament looks into “necessary constitutional amendments with regards to the kind of future land tenure regime needed‚ and to necessity of the state being a custodian of all South Africans”.
It would be misguided to think that it is only EFF which supports this paternal relationship. Under existing land policy those who do receive redistributed land are made tenants of the state or given conditional use rights, rather than become owners of the land. These lease and conditional use rights are often not registered thereby depriving beneficiaries of tenure security. If the goal is to equalise ownership patterns why does government policy deprive beneficiaries of ownership rights?
Wide discretionary powers.
PLAS is the current mechanism through which the state is currently redistributing land (through leases), and according to the HLP it has “widened the discretionary powers of officials”. It is no surprise that land reform is beset with corruption, uncertainty and inconsistencies when officials a) lacking legal training and skills, and b) are given wide discretionary powers.
The rule of law recognises that a state should be governed by predictable legal principles instead of the arbitrary whims of government officials. Legislation in South Africa, particularly that governing land reform, increasingly gives wide discretionary powers to ministers and officials enabling arbitrary and unpredictable decision making.
So important is the principle of the rule of law that chapter 1 (c) of the Constitution states that the Republic of South Africa is founded on the “supremacy of the Constitution and the rule of law”.
It is trite to add that officials need to have the flexibility to use discretion in their mandate of enforcing the law, however, we should be wary that discretion should not extend to powers allowing them to make up the law as they go along.
Parliament plays a critical role in holding the executive to account on the laws that it implements. But if the law gives ministers and officials broad discretion, without clear guidelines on how to exercise that discretion, then it makes it difficult for parliament to hold the executive to account, and in turn for the public to hold Parliament accountable. Why then is the debate not focused on how to limit the subjectivity of officials, and give more power back to Parliament?
If we’re interested in having a genuine debate on land reform this moment of heightened interest can still be salvaged. But only if we use this as an opportunity to blow the entire land reform process wide open, instead of the narrow focus on expropriation without compensation which should be relegated to the fringes of discussion where it belongs. DM
Gwen Ngwenya is Head of Policy and a Member of Parliament for the Democratic Alliance
Gwen Ngwenya is the COO of the South African Institute of Race Relations. She holds a masters degree in International Economics, before joining the IRR she worked in New Delhi as an economic researcher on merger and acquisition deals before the competition authorities. After a brief stint, she was poached by a global financial technology company and relocated to the United Kingdom. On her return to South Africa decided she wanted to work closer to current affairs and joined the SAIRR in 2016.
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