LETTER: Land rent can benefit all South Africans
Land cannot be distributed equally physically, so the locational advantage should be collected instead
Peter Bruce rightly infers that white South Africans should acknowledge the injustices of exploitation by capital and land acquisition during the colonial era. The latter were described by Tembeka Ngcukaitobi in The Land Is Ours while chronicling the epic contestations by early 20th-century black lawyers of moves to dispossess blacks of land both before and after the notorious 1913 Native Land Act.
In the process he also laid bare the failure of the British to ensure the establishment of basic principles of justice in SA after their victory in the Anglo-Boer War. Bruce then asks if there is a way whereby South Africans can talk to each other across our prejudices and fears.
There are indeed many ways, but the first and most important is to acknowledge the fundamental phenomenon of land and/or natural resources rent, which can be defined as the excess (and unearned) return to landowners after normal returns to labour and capital. This is, however, just another way of saying that all human beings need land but, as the latter cannot be distributed equally physically, the locational advantage (land rent) should be collected instead, for the benefit of each and every citizen.
I have often argued in these columns that these rents would obviate the need for most, if not all, taxation with massive incentivising effects both for landowners to sell surplus land and for entrepreneurs to start new businesses by taking advantage of the improved supply, and hence cheaper land, and little or no tax on the product of labour and capital.
Conversations around this topic could well be calm and enlightened after the early reintroduction of site value-only municipal rating, which would immediately give a practical demonstration of the advantages of a small but significant move in this direction.
Other ways of talking calmly about land would include digesting the work of both the main and supplementary reports of the presidential advisory panel on land reform. This in turn would be greatly enhanced if President Cyril Ramaphosa were to instruct all the members to reconvene until they establish a consensus — which, apparently largely due to time constraints, they were unable to achieve.
Bruce’s plea for South Africans to engage intelligently on the topic would include a much more meaningful effort by the government to acknowledge and support the substantial efforts in the direction of land reform by the commercial sector in recent years. Finally, it would also include acknowledgment by Ngcukaitobi and others that the land, as per the preamble to the constitution, belongs to all South Africans.
Stephen Meintjes, Parkwood