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Speech of Mr Jeremy Cronin, MP, Deputy Minister of Public Works, in the debate on Property Clause Limitation

13 June 2017

Speeding up Land Reform by using the limitiation clause in the Constitution to bypass the failed ‘Willing Seller, Willing Buyer Policy`

The land question in South Africa is a deeply emotive issue - and rightly so. White South Africans in particular need to understand this reality. The history of colonial and apartheid genocidal dispossession of land, livestock, crops, livelihoods, the enslavement of the Khoi and San peoples (those that survived the genocide) all of this has left a deep scar on our society. It underpins the continued racialised crises of poverty, inequality, unemployment and social distress for the great majority.

But what IS the land question in 2017? And how do we address it?

Two weeks ago the KZN land claims commission office complained that of the 110 claims settled last year, over 60% (or R423-million) was settled in cash (and not land) compensation.

KZN`s Land Restitution Support chief director, Advocate Bheki Mbili said it was a "general problem across the country…Many of the claimants already have small pieces of land and some don`t even live in those areas where their forefathers were removed from. Some say to us that they don`t want …the risk involved if they ask us to buy them these huge pieces of land that will go out of production."

Adv Bhili went on to say: "The problem with this is that if you look at the outcome of the first phase [of land restitution], the amount of land that is private land …is still in the region of between 70 and 80%. We can only change the land ownership pattern if people opt for restoration. If they opt for financial compensation the pattern stays the same. If you take the money you don`t dent the PROBLEM that currently exists."

But clearly there is a disjuncture between what the public official regards as THE problem and what "the people", the claimants regard as THEIR problem, and therefore their solution.

In the 1950s when the East German government expressed disappointment at the conduct of the people, the poet Bertolt Brecht suggested that if the government was unhappy with the people, it should dissolve the people and elect another.

Perhaps we should dissolve the people…and elect another?? Some have even suggested that we should amend the land restitution legislation to COMPEL claimants to accept land.

Obviously land restitution is only ONE dimension of what needs to be a broader land reform programme. But what the majority of land restitution claimants are telling us is that for many, for the majority of them, in fact, it is NOT a question of a simple RETURN, of a straightforward restoration, of a going BACKWARDS.

To build a non-racial, egalitarian, and inclusive society we have to go FORWARD, and radically.

Where I agree strongly with the NFP is that a market-driven solution - which is to say a "willing-seller, willing-buyer" - approach to the land question will not work.

The market is NOT what the followers of Adam Smith would have us believe - a zone of perfect freedom in which buyers and sellers interact on equal terms, trading to their mutual benefit and for the good of all.

There are huge inequalities on the market, especially in a society like South Africa.

If we attempt to introduce serious land transformation in our country, a market-driven (willing-seller, willing-buyer) approach is likely to result either in little progress or large-scale failure.

Why?

A willing-seller, willing-buyer approach is likely to result in a patchwork of farms acquired for land reform - depending on what comes on to the market. But land reform for agriculture requires effective and consolidated interventions to enable new farmers, or existing small farmers, to have a chance of success - this means state-led upstream and downstream market support, it means appropriate irrigation, water rights, fencing, agricultural extension officers, veterinary and crop services, logistics infrastructure. A piecemeal approach simply makes these critical interventions not feasible.

Of course the market might deliver up a more consolidated batch of willing-sellers under certain circumstances. This was what was rather cynically suggested by the FF+ earlier this year in parliament when they said the drought was now a good time to scale up a willing-seller, willing-buyer land reform programme - i.e. government at public expense would bail out drought-stricken white farmers and settle new farmers on parched land!!

Successful land reform programmes, like that in South Korea (which was the foundation of its subsequent remarkable industrialisation) are about scale AND about unleashing productivity.

In SA, with some 64% of our population urbanised, and ongoing urbanisation is accelerating rapidly - the land question is significantly - perhaps even primarily - an URBAN issue. But we know that the property market in our urban centres, just as in rural areas, creates barriers to entry and inclusion for the majority that are just as severe as apartheid-era Group Areas, forced removals and pass laws.

This the general context in which we need to approach the subject of today`s debate:

Is our 1996 Constitution, and specifically (as is implied in the topic for debate) is Clause 25, the Property Clause an impediment to achieving effective, meaningful, sustainable land reform - both rural and urban?

Can the blockage (as is implied in the topic for debate) in Clause 25 be overcome by invoking Clause 36?

Let me appreciate the intention behind the Hon. Member from the NFP`s proposal - to stay within the bounds of the Constitution and at the same time find a durable approach to Land Reform.

But well intentioned as it is - the topic for debate is misguided, is barking up the wrong tree.

There is absolutely no need to sneak around Clause 25 by invoking Clause 36.

  1. In the first place, there IS no "willing-seller, willing-buyer" requirement in the Property Clause - in fact you won`t find any reference to "willing-seller, willing-buyer" in the Constitution at all. What is to be found in the Property Clause is the requirement that in the case of expropriation, "just and equitable" compensation must be paid.

But the Property Clause is very clear, compensation is not based simply on "market value", but on the principle of "just and equitable". The Property Clause allows for expropriation in the public interest - which it explicitly defines as "The nation`s commitment to land reform, and to reforms to bring about equitable access to all South Africa`s natural resources."

  1. What is more, Clause 25 has its own Limitation Clause - even before we get to Clause 36. Clause 25 (8) reads: "No provision of this section may impede the state from taking legislative and other measures to achieve land, water and related reform, in order to redress the results of past discrimination…"

In other words, the compensation provision cannot be used to impede land reform…and, therefore, I would argue, compensation could, in certain circumstances, be merely a token.

Is compensation the real hurdle to effective land reform?

We`ve already noted that hundreds of millions of rands are being spent in the Land Restitution programme to pay cash to claimants and NOT to purchase land.

Also to be noted is that in the past the state has often been taken for a ride - the R1-billion paid for a land restitution claim on Mala-Mala being the most obvious case.

This Parliament in 2014 passed the Property Valuation Act, which, amongst other things established a state Valuer-General. Instead of relying on the private sector to value property, the Department of Rural Development and Land Reform now has its own Valuer-General, and according to Minister Gugile Nkwinti, already that office has saved the public purse R84-million on what would otherwise have been paid for farms.

What is more, the courts are ahead of many politicians sitting here in Parliament.

In July last year, the Land Claims Court heard a case in a land claim brought by a Mr Philemon Msiba whose father had been a tenant farmer. When the dispute over payment finally reached the Land Claims Court last year, the farm owner`s expert valuer said the market value of the portion of claimed land was R4,4 million. The state valuer general for the Department of Rural Development and Land Reform argued that it was R1,8 million.

Interestingly, the Land Claims Court brought the price down even further - to R1,5 million. The wording of its ruling is noteworthy - it argued that a "just and equitable" price is not the same thing as a market-price. Moreover, in its ruling it argued that, in assessing price in cases of land reform "market value must not be given more weight than other factors listed in Section 25 of the Constitution" - these other factors include the "history of the acquisition of the property" and its "current use", and the "purpose" for which it is now being acquired.

Interestingly (perhaps not surprisingly) during Portfolio Committee hearings on the Expropriation Bill, the DA and FF+ argued, contrary to what the court has ruled, that "market value" should be the pre-eminent criteria.

What about the EFF?

The EFF`s position has been both consistent and incoherent.

It says it wants to give the ANC its parliamentary votes so that we can change the Constitution to allow for expropriation without compensation - but while it is saying that, it is giving its votes to the DA in Metros - the very DA that wants compensation to be determined largely on the basis of market value.

On the other hand, the EFF says the present government is a kleptocratic government - but it wants to change the Constitution so that this same government can expropriate without compensation! Go figure!!

We don`t need to change the Constitution - but we do need to expedite the long-delayed Expropriation Bill - which the President has sent back, but on strictly procedural grounds.

Above all we need to drive a sustainable rural and urban land reform programme that can`t be about hitting mechanical targets for their own sake. A radical land reform programme must be about productive lives, about sustainable livelihoods, about food security for all, about not just a new class of commercial farmers, but also sustainable livelihoods and sustainable communities for those living in communal land tenure dispensations, about mixed-use, mixed-income human settlements on well-located land.

The Constitution is not an impediment to these objectives - in fact it is a clarion call to achieve these goals.

     
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