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Sneaky constitutional amendment guts property rights

Ivo Vegter is a columnist and the author of Extreme Environment, a book on environmental exaggeration and how it harms emerging economies. He writes on this and many other matters, from the perspective of individual liberty and free markets.

The draft of the Constitution Eighteenth Amendment Bill, amending the property rights clause (Section 25) of the Bill of Rights, means the Constitution will no longer protect property rights. It permits expropriation without compensation at the whim of members of Parliament.

The draft amendment to the property rights clause of the Bill of Rights, sneakily published just as the schools closed for the holiday season in the hope that nobody would pay attention, is bad news for property owners.

(It is also bad news for grammar mavens, who would surely share my objection to the horrendously dissonant title “Constitutional Eighteenth Amendment Bill”, preferring instead the “Eighteenth Constitutional Amendment Bill”.)

It permits the court, “where land and improvements thereon are expropriated for the purposes of land reform, [to] determine that the amount of compensation is nil.”

The amendment further requires national legislation to “set out specific circumstances where a court may determine that the amount of compensation is nil”.

On one hand, the draft explicitly limits the possibility of “nil compensation” to land and improvements thereon when they are to be expropriated for the purposes of land reform. The property rights section also explicitly says property is not limited to land, so this allays the widespread fear that the wording might have applied to all property, including such assets as investments, cash, art, vehicles, weapons or computers.

On the other hand, it leaves the circumstances under which courts may determine that the compensation is nil up to national legislation. That means the majority party in government can change these circumstances on a whim.

For a good example of how this could work in practice, the first section of the IRR’s submission on the 2019 Expropriation Bill makes for instructive reading.

That lawmakers can at any time pass laws to change the circumstances under which expropriation would be okay with nil compensation, completely undermines property rights in land and the improvements thereon. The Bill of Rights in the Constitution is supposed to apply to all law, binding the legislature, the executive, the judiciary and all organs of state. In this case, it doesn’t bind the legislature at all, since it leaves lawmakers free to determine among themselves the conditions under which property rights will not be respected.

Their venality is exposed from the outset by the fact that “nil compensation”, in the minds of government apparatchiks, means something other than “no compensation”. This will no doubt be of great comfort to the unfortunate citizens who are granted compensation of nil, instead of not being granted any compensation at all.

The draft amendment retains the “fair and equitable” requirement of subsection 3, although it does not explain why nil compensation would meet that standard.

The preamble to the amendment bill is also rather misleading.

WHEREAS there is a need for urgent and accelerated land reform in order to address the injustices of the past that were inflicted on the majority of South Africans and especially as the hunger for land amongst the dispossessed is palpable and the dispossessed are of the view that very little is being done to redress the skewed land ownership pattern;

The slow progress of land reform has nothing at all to do with Constitutional limitations. This paragraph also conflates “land reform” with returning land to the “dispossessed”, which is more accurately termed “land restitution”. “Land reform” is a far broader term, which also covers land redistribution and land tenure reform.

There is nothing in the Constitution that would prevent land restitution, even at nil compensation.

It is also far from clear that there is a substantial “hunger for land”. Surveys have repeatedly found that the number of South Africans who desire land for farming fall in the low single-digit percentages, and that is before they’ve even considered the practical realities and precarious profit margins of agriculture. Nine out of 10 land restitution recipients opted to receive cash in lieu of land, because they wanted to live in cities, near job opportunities.

AND WHEREAS Section 25 of the Constitution of the Republic of South Africa, 1996, must be amended to make explicit that which is implicit therein, so that an amount of nil compensation is explicitly stated as a legitimate option for land reform;

Since there is nothing in the Constitution except the “fair and equitable” phrase which requires the compensation amount to be higher than nil, and since that phrase is not removed by the amendment, there is no reason why what is implicit in the property clause must be made explicit.

AND WHEREAS such an amendment will contribute to addressing the historical wrongs caused by the arbitrary dispossession of land;

No, it won’t. Land restitution is in no way limited by the Constitution, so no amendment could contribute to further restitution. In fact, land restitution (unlike land redistribution and land tenure reform) has been fairly successful in the past.

AND WHEREAS such an amendment will further ensure equitable access to land and will further empower the majority of South Africans to be productive participants in ownership, food security and agricultural reform programs;

Once again, the Constitution is no obstacle to “equitable access to land”, whatever that actually means. Moreover, more than 90% of existing land reform programmes have failed, with previously productive land having fallen into unprofitability. There is no reason to expect that this amendment will in any way contribute to land productivity or food security.

Undermining property rights does not threaten only “whites who stole the land”, of course. There are more non-white property owners than white owners, whose rights will be equally threatened by the ability of the legislature to expropriate them on a whim.

See this article on why expropriation without compensation is unnecessary, and will lead to tears. See also this article on why even supposedly justifiable land expropriation leads to a dangerous slippery slope of abuse and corruption.

The draft amendment must change, if property rights are to remain even partly protected.

Instead of leaving the circumstances in which a court may determine that the amount of compensation is nil up to Parliament, which may change those circumstances whenever they feel like it, the circumstances should themselves be enshrined in the Constitution. Changes to those circumstances should require a Constitutional Amendment.

Failing to do so makes a mockery of the purpose of the Bill of Rights, since it will effectively bestow no rights at all upon citizens to protect them against the actions of the government.

Let’s start making submissions. Submissions must be received by no later than 31 January 2020, so best not blink during the holiday season. They can be emailed to [email protected]. Alternatively, write to Mr V Ramaano, 3rd Floor, 90 Plein Street, Cape Town, 8000.

It seems to be generally agreed that nil compensation is already implied in the Constitution as it stands, provided that such compensation be deemed “fair and equitable” by a court of law. There is no need to make it explicit.

If the ruling party, for nakedly political purposes, seeks to make it explicit, then at least set the circumstances under which that may happen in stone. South Africans, black and white, deserve to be well protected from the whims of politicians and bureaucrats. The Constitution Eighteenth Amendment Bill fails to do that. DM


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