Endorse our submission


The allotted period for public comment to the Joint Constitutional Review Committee closed on 15 June, when the IRR submitted more than 55 000 endorsements to the committee secretariat. However, the debate about property rights and land reform is not only continuing, but will likely intensify, and your endorsement of this submission will strengthen the IRR’s efforts to protect property rights and make the case for an effective, sustainable land reform process that will best serve all South Africans.

Pat Jayiya, Committee Co-ordinator

Joint Constitutional Review Committee

PO Box 15

Cape Town

8000

pjayiya@parliament.gov.za

Please place it on the record that I endorse the following submission on why the government should not reduce property rights protections in South Africa. 

Since 1994, the ANC government has been pursuing a land reform programme with three key prongs: the restitution of land to the dispossessed, the redistribution of 30% of commercial farming land to black South Africans, and the granting of secure title to land to those lacking this. However, progress has been slow, while production has collapsed on at least 70% of restored land and sometimes on as much as 90% of transferred land.

Since 2005, the ANC and many land activists have repeatedly blamed the failures of land reform on the inflated prices the state has ostensibly been forced to pay in buying up land for restitution or redistribution. In December 2017, at its national conference held at Nasrec in Johannesburg, the ANC resolved that expropriation without compensation (EWC) should be one of the mechanisms available to the government to speed up land reform.

Soon afterwards, the EFF demanded that the ANC, in line with its Nasrec resolution, should vote with it on a motion to amend the Constitution to allow EWC. In February 2018, this motion (somewhat modified by the ANC) was adopted by the National Assembly. It ‘instructs’ a parliamentary committee, the Joint Constitutional Review Committee, to ‘review Section 25 of the Constitution and other clauses where necessary to make it possible for the state to expropriate land in the public interest without compensation’.

The history is more complex than politicians admit

The ANC’s call for EWC is ostensibly aimed at speeding up land reform. The way in which land was acquired in the colonial era, from 1652 (when Jan van Riebeeck arrived at the Cape to establish a victualling station for the Dutch East India Company) to 1910 (when South Africa became a unified political entity), is far more complex than the simple narrative of dispossession now being advanced.

In this period, there were forcible land acquisitions not only by whites from blacks, but also by the Xhosa (King Hintsa) from the Khoi and the San; by the Hurutshe from the Tswana; by the Zulu (King Shaka) from the Hlubi, the Ngwane and the Swazi; by the Ndebele (King Mzilikazi) from the Tswana; by the Kgatla from the Po; by the Tswana in the Kalahari area from the Khoi, the San, the Kgalagadi, and the Yei; and by many other black groups against their weaker neighbours. In addition, after the discovery of gold on the Witwatersrand in 1886, the independent Voortrekker republics in the Orange Free State and Transvaal were defeated by Britain in the second Anglo-Boer War (1899-1902). They were then incorporated, together with Britain’s existing colonies in the Cape and Natal, into the Union of South Africa.

The historical record is thus complex and often inadequately documented.

The period after 1913 was marked by one of apartheid’s greatest injustices – the forced removal of some 2.1m black, so-called ‘coloured’, and Indian people from their rural land or urban homes.

These land injustices are quite bad enough in their own right, without being exaggerated in any way. Yet the ANC is now distorting the historical record, so as to whip up popular anger and buttress its call for EWC. Whites are repeatedly being accused of having ‘stolen’ the land during the colonial period, when in fact many black groups were then equally intent on acquiring land by conquest and treaty. These were also the established and generally accepted means of land acquisition at the time.

EWC will not address the reasons land reform has failed

The reasons for the failures of land reform since 1994 are many and complex, but five common factors can be discerned.

The first is that the budget for land reform has long been set at only some 1% of total budgeted expenditure. In the current financial year, for instance, R3.4bn has been allocated to land restitution, but this is only 10% of the R30bn budget set aside for both agriculture and land reform. It is also far less than the R12bn allocated to the salaries of officials in these departments. The amount set aside for land restitution is also only 0.2% of total budgeted expenditure of R1.67 trillion in the 2018/19 financial year.

The second is that the government does not allow individual ownership of land acquired for restitution or redistribution. Restitution land is generally owned by communal property associations (CPAs), which are commonly riven by dissent and driven by self-interest on the part of their trustees. Redistribution land is generally kept in state ownership and can only be leased, not bought, by emergent black farmers. These farmers generally lack title to the land they work, which means that they cannot use this land as collateral and battle to raise working capital.

The third is that the government seems to assume that access to land is sufficient in itself for success in farming. However, land is only the first on a long list of requirements. No less important are experience and entrepreneurship, along with working capital, know-how, machinery, labour, fuel, electricity, seed, chemicals, feed for livestock, security, and water. 

The fourth is that many of the people to whom land has been transferred have little knowledge of agriculture, and have simply been dumped on farms with little effective support from the state. According to Salam Abram, an ANC MP who is himself a farmer and who served on the parliamentary committee for agriculture for twelve years, land reform has been a ‘dismal failure’ because no proper ‘after-settlement’ support has been provided to beneficiaries.

The fifth is that the restitution process has been dogged by so much inefficiency and corruption that officials do not know how many claims they have received, how many they have gazetted, how many have been wrongly gazetted (and should thus be delisted), and how many have yet to be resolved. The land reform process has also often been abused to benefit ANC insiders who use their political connections to get the state to buy them farms and then sell off cattle and other assets and allow crop land to fall fallow.

Farmers are not racists or land thieves and poor people are not demanding land

Since 1994 white farmers have repeatedly been stereotyped as incorrigible racists who commonly abuse, assault, and even kill their hapless farm workers. Evidence of good relationships between farmers and their employees has been ignored or downplayed, while incidents of violence on farms have been given major and often distorted coverage. This stigmatisation has paved the way for the major propaganda campaign now being mounted in support of the EWC proposal. This involves the constant repetition of various key themes, so as to conceal the truth and skew public perceptions. Racially charged rhetoric about whites having ‘stolen’ the land is also being used to buttress the EWC demand.

The government has long claimed that public ‘clamour’ for access to land is forcing it to step up the pace and extent of land reform. More recently, Mr Ramaphosa has repeatedly stated that the ANC must move ahead with EWC because of a ‘pressing’ and ‘urgent’ hunger for farming land among South Africans.  However, comprehensive opinion polls commissioned by the IRR from 2015 to 2017 have repeatedly shown that the great majority of black South Africans have little interest in land reform. This is not surprising, as the country is urbanising rapidly and most people want jobs and houses in the towns and cities.

In the IRR’s 2016 field survey, moreover, only one percent of black respondents (down from two percent the previous year) said that ‘more land reform’ was the ‘best way to improve lives’. By contrast, 73% of black people saw ‘more jobs and better education’ as the ‘best way’ for them to get ahead. In similar vein, in the IRR’s 2017 field survey, only one percent of black respondents identified ‘speeding up land reform’ as a top priority for the government. Even among people who were dispossessed of land under apartheid laws, there has been little interest in land as opposed to cash compensation. By 2013, thus, only 8% of some 76 000 successful land claimants had chosen to have their land restored to them, while the remaining 92% wanted cash compensation instead.

Black people control more land than politicians admit and will lose out under EWC

The government has long promised a comprehensive audit of land ownership by race. An audit of this kind was thus finalised in November 2017 and released in February 2018. Its main focus was on allocating a racial identity to privately owned land, but it found that 61% of the country’s total land area was owned by companies, trusts, churches, and other organisations, the racial identity of which could not easily be established. The audit therefore left this land out of its analysis.

Turning to the 33% of land owned by individuals, rather than by juristic entities, the report stated that blacks owned a mere 1.2% of rural land and only seven percent of formally registered erven (plots) in towns and cities. As regards some 94 million hectares of agricultural land, the audit stated that 37 million hectares were privately owned by individuals, of which whites owned 26.7 million hectares (72%), coloured people owned 5.4 million hectares (15%), Indians owned 2 million hectares (5%), and blacks owned 1.3 million hectares (4%).  

The report’s conclusion – that black people own less than two percent of all land and only four percent of agricultural land – leaves out the 61% of land which is privately owned by companies and other juristic entities. It also excludes:

  • all land in state ownership;
  • all land held in traditional customary ownership;
  • the formal houses that are owned by 8 million black people, but often without their having title deeds; and
  • most restitution and redistribution land (the 8.2 million hectares the state claims to have bought, but which cannot be privately owned by black people because of the government’s insistence on collective or state ownership, as earlier outlined).

A far more accurate audit of land ownership has been conducted by Agri SA. This audit report (published in November 2017) put the total amount of land, both urban and agricultural, owned in 2016 by the government and ‘previously disadvantaged individuals’ or ‘PDIs’ (defined as people of black, coloured, and Indian descent) at 43 million hectares or 35% of the country’s land area. It put the total quantity of farming land owned by the state and ‘PDIs’ as 25 million hectares or 26.7% of the total. Taking land potential into account, it put the proportion of agricultural land owned by the government and PDIs at 46.5%.

EWC will not see poor people owning land

The ANC has repeatedly claimed that EWC will ‘return’ the land to ‘the people’.  However, this is fundamentally misleading. Land expropriated without compensation will be owned by the state, not by individual black South Africans. Nor will it be transferred to them thereafter, for the ANC’s policy is to keep land in state ownership. Land acquired via EWC will be held by the state as a patronage tool and used by it to deepen dependency on the ruling party. This is the fraud at the heart of the EWC idea.

Landlessness is not the predominant cause of poverty and inequality 

The ANC often also claims that skewed land ownership is the predominant cause of poverty and inequality. This diagnosis makes little sense. The agricultural sector contributes a mere 2.3% to GDP and provides only some four percent of all employment. Hence, it cannot possibly provide all the jobs and incomes required to lift some 30 million people out of poverty. In addition, the key causes of poverty and inequality lie rather in anaemic growth, poor schooling, high unemployment, state inefficiency, pervasive corruption, and a mistaken reliance on BEE, which benefits a small elite while bypassing and harming the poor.

EWC will harm the economy and undermine South Africa’s democracy

The Constitution should not be amended to allow EWC. The property clause was one of the most tightly negotiated compromises in the final Constitution. Non-ANC parties conceded the principle of expropriation in the national interest, which included land reform. In return, the ANC accepted that equitable compensation would be paid for expropriated property. The property clause was at the heart of the constitutional agreement – because, as the ANC correctly observes, 'property relations are at the core of all social systems'.

An EWC amendment would not only unravel one of the most important elements in the Constitution but also set a precedent for further damaging changes. The doctrine of judicial review, for example, is already being eroded – especially on issues vital to the ANC's National Democratic Revolution (NDR) – through the ruling party’s significant control over judicial appointments. But the doctrine might then be jettisoned altogether, so that the legislation adopted by Parliament can no longer be ‘undermined’ by unelected judges. This would take South Africa back to the doctrine of parliamentary sovereignty and fundamentally weaken all constitutional safeguards against the abuse of power.

The notion that EWC is possible within the parameters of the present property clause is only marginally less dangerous. This, too, would deal a ‘body blow’ to the negotiated settlement reached in the 1990s. It would be an invitation to the government to embark on the extensive custodial takings and wide-ranging regulatory expropriations it already has in mind. This, too, would fatally erode investor confidence and the prospects of boosting growth and reducing unemployment.

The EWC debate has already spurred a series of urban land invasions, while much fixed investment into South Africa has been delayed pending the outcome of the EWC proposal. If that proposal goes ahead, South Africa may never attract the investment it needs to grow the economy, create jobs, and free poor people from a life of poverty and dependency.

What should be done?

The critical issue is not the number of hectares transferred – especially when most of that land is then likely to fall out of production – but rather how best to increase the number of successful black commercial farmers. Emergent farmers wanting to expand into large-scale production must thus be helped to do so. However, no one should be encouraged to believe that farming is an easy option, when agriculture is in fact an exceptionally high-risk sector – and especially so in a water-stressed country such as South Africa.

Emergent farmers who want to expand should buy property at market prices from among the 20 000 farms that are already on the market. Preferential interest rates could be made available by the Land Bank to facilitate these purchases. Estimates by the IRR show that several hundred new commercial farmers could be financed annually just by cutting the amount of money spent on VIP protection of politicians or subsidies to parastatals.  

For example, the IRR estimates that it would cost between R15 million and R20 million to set up a black commercial farmer with a 1 000ha farm. purchased free and clear, with the required equipment and livestock (200 head of cattle) and working capital for three years. Consider that the government has spent about R15 billion over the past two years bailing out South African Airways - this money could have set up between 750 and 1 000 serious black commercial farmers. Given that there are about 35 000 commercial farmers in the country, this would be a significant numbers of farmers who would contribute to the sector.

The role of the state should largely be confined to the critically important task of providing better rural infrastructure in the form of roads, railways, and dams. Electricity, abattoirs, produce markets, and milling and storage facilities could be provided either by the state or by the private sector.

The government should also help with the financing of effective extension services. The government should stop trying to provide these services itself, as it clearly lacks the capacity to do so. Emergent farmers will often need to borrow from commercial banks and will battle to do so unless the government guarantees their loans. This will have to be done if small black farmers are to grow into big ones.

South Africa’s current crop of 35 000 or so commercial farmers should be encouraged to stay on the land and keep producing, so as to feed the nation, contribute to export earnings, and provide the necessary mentoring to new entrants. The population is expanding (from 40 million in 1994 to a projected 67 million in 2030) and will soon be more than 70% urbanised. Its need for secure and affordable food supplies thus cannot be met in any other way.

In addition, much of the country’s well-watered and high-potential farming land is still held in customary communal tenure in former homeland areas. As a result, large swathes of this land are not being used for agriculture at all. This land cannot be brought into full production without much better infrastructure and sound extension services. Secure title must also be transferred at reasonable prices to present occupants, who are currently tenants of the state as represented by traditional leaders. Those who rely on social grants rather than on farming could be bought out by people wanting to become commercial farmers. Consolidation into much larger units will also be needed to achieve economies of scale.

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