Land reform in South Africa has and will continue to be a contentious topic. In resolving the inequalities of the past, the South African government undertook in 1994 to make sure land ownership was more reflective of the demographics of the South African population. The promise was to return land to the black and coloured people that had it taken away from them as a result of the 1913 Native Land Act, the 1950 Group Areas Act and other similarly discriminating legislation during apartheid.
The infamous 1913 Native Land Act restricted the 80% of the South African population to 13% of the South African land based on race. Black Africans were restricted to small Bantustans while the white minority was left in control of the remaining 87%. After the first democratic elections in South Africa in 1994, the newly seated government embarked on a land reform process, involving land restitution, land redistribution and rural development.
The land redistribution process has been particularly controversial. In correcting the wrongs of the past, the land redistribution policies sought to return land to those dispossessed of it through the 1913 Land Act. The 1994 Land Restitution Act was based on the ‘willing buyer, willing seller’ concept and land was to be bought from land-owners, by the government, and then given back to those who were dispossessed by the 1913 Land Act. Unfortunately, the process has taken very long and encountered many problems.
To date, only a fraction of the government’s land reform targets have been met, which has in turn angered supporters of the incumbent political party, the African National Congress (ANC). On top of this, many land-owners have also been angered by the way in which the policies have been carried out and not receiving supposedly fair prices for their land. It was also revealed in news in November 2009 that the Land Claims Commission still owed R10-billion to beneficiaries and land-owners that it had bought it from.
There has been much said about the land reform process and more recently concerning the issue of nationalisation of land. However, the national government, through the Department of Rural Development and Land Reform, has stated that the nationalisation of land will not happen. The Minister of Rural Development and Land Reform, Gugile Nkwinti, said, in his budget speech at the end of March, that the green paper on agrarian transformation, rural development and land reform only proposed that the current land tenure system be ‘overhauled’ to improve upon previous land tenure legislation.
According to the minister, the new paper will lay out a new three-tier system, addressing the issues of: state land under leasehold, private land under freehold with limited extent, and foreign ownership with precarious tenure linked to productivity and partnership plans with South African citizens.
Despite concern from certain parties, property rights are enshrined in South Africa’s constitution and it states within section 25 that: 'No one may be deprived of property except in terms of law of general application, and no law may permit arbitrary deprivation of property.' In terms of expropriation, this is also clearly only to be done with fair compensation for those affected… 'Property may be expropriated only in terms of law of general application: (a.) for a public purpose or in the public interest; and (b.)subject to compensation, the amount of which and the time and manner of payment of which have either been agreed to by those affected or decided or approved by a court.'
This is not just idle talk but is recognised as a prominent document internationally. The 2010 International Property Rights Index lists South Africa at 24 out of the 125 countries included in the report. South Africa ranks even higher (22 out of 125) in the physical property rights sub-index.
There have also been signs that there is significant investor confidence in South Africa’s agricultural sector. The positive growth has been recognised for many months now and in September 2009, Absa and Nedbank, two of South Africa’s largest banks, committed to increasing loans to the sector. In another report towards the end of March this year, Futuregrowth Asset Management and UFF Asset Management joined forces to establish a R3-billion farmland investment fund to provide a vehicle for institutional investors to invest in South African farms. On top of this, Standard Bank has in recent days set up a R500-million economic empowerment fund for emerging black farmers.
It has been acknowledged by government that the land reform programmes implemented to date have not been sustainable and of the six million hectares transferred through restitution, there have not been many instances of continued productivity and economic gain to the new occupants. These issues will continue to plague the government and frustrate the poor.
The point is that despite the shortcomings, the government has not made any decisions, which have affected property rights detrimentally. They have recognised the shortcomings and although not everyone might be convinced that their new 2010-2013 Strategy will be immediately effective, it is unlikely to change property rights significantly. One of the concerns that has been raised is the potential altering of section 25, where the idea of 'freehold with limited extent' would potentially limit the number of properties an individual can own or limit the size of a property an individual can own.
It is a question of waiting for the green paper to be released and then participating in the debate over land reform. The South African government would clearly be doing itself and the South African people a disservice if it were to deny all people, including potential foreign investors and land owners, secure ownership over property.
