The Institute of Race Relations (IRR) has told MPs that South Africa’s land reform problems stem largely from inefficiency, corruption and an absence of secure ownership, and the Expropriation Bill now before Parliament will not provide solutions.
This point was made in a presentation to Parliament’s portfolio committee on public works and infrastructure on the Bill by IRR head of policy research, Dr Anthea Jeffery, this week.
Jeffery also pointed out that the Bill covered far more than land, as was commonly thought.
The threat to property covered ‘homes, pensions, business premises, mining rights, shares, and unit trusts – all of which will fall within the Bill’s definition of ‘property’ – and all of which will be vulnerable to expropriation for ‘nil’ or inadequate compensation’, she said.
Contrary to government reassurances, the Bill was thus not limited to land reform, Jeffery pointed out, and it would not solve land reform problems, ‘which stem largely from inefficiency, corruption, and an absence of secure ownership’.
In a statement yesterday, Jeffery pointed out that, rather than contributing to land reform, the Bill threaten the property rights of all South Africans: from the 9.8 million people with home ownership (7.8 million of whom are black) to the roughly 18 million individuals with customary law plots, and the estimated 17 million people who belong to pension funds. It would also harm all business owners, both large and small.
“At the same time,” said Jeffery, “the economic fall-out from the Bill will further hurt the 11 million individuals now unemployed by reducing investment, limiting growth, and stalling any post-lockdown recovery.”
Jeffery argued that three ‘core amendments’ were required.
‘First, the bill must make it clear that a prior court order – which confirms the validity of the expropriation and decides on the just and equitable compensation to be paid –must be obtained before a disputed expropriation can proceed.
“Second, the bill must require that the full amount of compensation be paid prior to the transfer of ownership to the state. And third, the compensation payable must include damages for all losses resulting from the expropriation. Such damages would include moving costs, any loss of income, and any outstanding balance on a mortgage bond which the compensation paid would otherwise not be enough to cover.’
Added Jeffery: “South Africa needs new expropriation legislation that is fully compliant with the Constitution, but the current Bill does not meet that test. The IRR’s alternative bill, by contrast, will bring the Bill into line with the Constitution, with international best practice, and with the economic imperative to increase prosperity for all.”