Picture: 123RF/LOES KIEBOOM
Picture: 123RF/LOES KIEBOOM

This time last year SA heard for the first time that the ANC was considering amending section 25 of the constitution to allow for the expropriation of land without compensation.

Since the landmark announcement at the governing party’s 54th national policy conference, land reform dominated public conversation in 2018, with the phrase “expropriation without compensation” becoming SA’s word of the year. 

The Joint Constitutional Review Committee’s adoption of the recommendation to parliament that section 25 be amended was followed by an urgent interdict by lobby group AfriForum to halt the debate on land reform in the National Assembly, which was subsequently dismissed in the high court. A date has not yet been set to hear AfriForum’s second case centred on the public participation process.

As expected, the ANC and EFF voted in favour of the adoption of the committee’s report. Though the report states that parliament must table, process and pass a constitutional amendment bill before the end of the fifth democratic parliament (our current parliament), it is highly unlikely the Expropriation Bill will be finalised in 2019.

Furthermore, parliament’s traditionally busy schedule at the beginning of the year makes it implausible that the lengthy process of adopting a bill, which includes, among other conditions, another public participation process, will be concluded before the country’s national general elections in 2019. So, as we look ahead, land reform will undoubtedly take centre stage in the run-up to 2019 elections.

Debates about changing the constitution were received with criticism, with some arguing that expropriation of land without compensation would erode property rights, which are the foundation of individual liberty; if property rights collapse, so too will the economy. Today we are faced with the reality of the decision that the governing party has taken to proceed with amending section 25 to allow for expropriation of land without compensation. Several warnings have been raised around the impact this will have on the economy and job creation.

Amid concerns raised by the SA business community about the possible impact on investment in our current economic climate, which is characterised by job shedding in key sectors such as agriculture, the depreciation of the rand and the country’s relegation to sub-investment grade by ratings agencies, international investors have called for the government to provide greater clarity on its land reform plans.

The cost implications of this process must be clearly articulated. It is estimated the government would need the equivalent of at least double the annual GDP to implement a satisfactory land resettlement programme based on expropriation without compensation. It may help the government to phase the process in a way that is affordable as the expectations created might lead to negativity, anarchy and even ghost settlements; it would be prudent to provide a financial plan on how exactly this process will work.

From our current position on the issue, it may be worthwhile to begin to shift our focus and look at what can be done to ensure the process is seamless, progressive and achieves the outcomes it seeks in the face of naysayers. From where we stand, our reality as a country is that expropriation without compensation will proceed; how it’s done will make or break the country, and the government must clearly articulate this and guide the process to enable a progressive process going forward.

A number of questions have been posed by agricultural economists and researchers alike about how expropriation without compensation will be implemented, such as:

  • How will the law cater for the assets on a farm and improvements made on the land?
  • If compensation is due for farm assets and not just for the land itself, then would it be prudent for the government to pay more to compensate farmers for improvements to the land in order to obtain the actual value of the land?
  • Will there be compensation to banks, which are often de facto partial owners of land through farmers’ debt? 

Other questions worth asking include:

  • How do we urgently address the current problems facing land reform?
  • How do we select land-reform beneficiaries, and what are they eligible to receive?
  • How will beneficiaries of land reform be supported to ensure productive use of land?
  • How do we make it possible for churches, mines, banks, state-owned enterprises etc to donate land for land-reform purposes?
  • Does the country have enough resources, expertise and capacity to support beneficiaries of land reform without the support of the farmers who may be displaced?
  • How will the government ensure that land reform leads to poverty reduction for the millions of South Africans who live in extreme poverty?
  • How will reform in urban and rural areas be addressed?

As parliament moves forward with expropriation without compensation, it is important that we don’t turn a blind eye to the challenges of land reform. In fact, we must look at the government’s target to redistribute 30% of the land by 2030 while we seek to understand why only 8% of the target has been reached and, even more importantly, why a significant portion of this redistributed 8% has been unsuccessful.

We must address these challenges as we seek to move forward to make land reform a success in SA. If we decide to look past these issues, this process is bound to backfire spectacularly. 

Looking at the country’s not-so-impressive track record with previous efforts to redistribute land, partnerships will be crucial to help drive a more progressive process. The public and private sectors must delve deeper into how partnerships can be cultivated without tensions to enable a more successful land reform process.

Vumelana Advisory Fund has been assisting beneficiaries of land reform to establish commercially viable partnerships between investors and the communities with a focus on creating jobs, skills and income with some measure of success. It is important that we refrain from reinventing the wheel. Let us rather use the lessons learnt over the years and build on this to address the current challenges and fast-track sustainable land reform. In doing so, we must not forget the wounds borne by all South Africans because of the land issue. If we forget, we will not heal or succeed. The process must tackle not only the land issue, but also the past and present psychosocial scars the issue of land has left behind.

Whatever we do, all South Africans must guard against expropriation without compensation only benefiting the greedy appetites of the chosen few and ensure the process will not be sacrificed at the altar of political expediency.

 Setou is the CEO of the Vumelana Advisory Fund.