Letter: Chamber of Commerce shows ignorance over land reform report - Businesslive

1 August 2019 - The Cape Chamber of Commerce and Industry demonstrates extraordinary ignorance of the contents and implications of the report of the presidential advisory panel on land reform.

The Cape Chamber of Commerce and Industry demonstrates extraordinary ignorance of the contents and implications of the report of the presidential advisory panel on land reform (Cheers for land panel, July 31).   

The panel endorsed expropriation without compensation (in 10 supposedly limited circumstances — such as land that is held “purely for speculative purposes” — but also made clear that the circumstances meriting “nil” compensation are “not limited to” the ones it lists.

The panel further suggests section 25 of the constitution be amended to “move away” from current “mandatory” compensation. The wording it suggests would authorise the adoption of virtually any expropriation law. 

The panel also recommends a new “compensation policy”, under which compensation will range from “zero” to “minimal”, “substantial” or “market-related”, depending on the circumstances.

Given the state’s fiscal circumstances and the ideological inclinations of the cabinet, market-related compensation — not necessarily the same as market value — is likely to become the exception. 

The report further suggests that all municipalities, including urban ones, “with the input of local residents”, must identify well-located and appropriately serviced land that is suitable for redistribution. “Individual owners of properties that meet the criteria of land required for redistribution… may [then] offer their land as donations, or enter into negotiations with the state, failing which the state may proceed to expropriate.”

This is fundamentally coercive and will in practice make it very difficult for banks to accept land as collateral for loans as virtually any land in any part of the country could be expropriated at well below market value.

The panel also seeks the introduction of “prescribed asset” requirements, though it does not use this terminology. Instead, it urges “a specific drive to mobilise the private sector, ie commercial banks, asset managers and pension funds, to respond to the urgency of financing the excluded majority”. 

That a chamber of commerce could welcome such a draconian intrusion does much to explain why the ANC has been able to proceed so easily with interventions fundamentally at odds with the needs of the economy — and also with the preference for “business-friendly” policies of the great majority of South Africans, both black and white.

Dr Anthea Jeffery
Institute of Race Relations

https://www.businesslive.co.za/bd/opinion/2019-08-01-letter-chamber-of-commerce-shows-ignorance-over-land-reform-report/

© 2018 South African Institute of Race Relations
CMS Website by Juizi

Terms & Conditions | Privacy Policy | Accuracy Guarantee | Sponsors & Donors