THE BLOG
19/03/2018 12:52 SAST | Updated 19/03/2018 16:08 SAST

Government's Final Resolution On Land Is Vague – Perhaps Deliberately So

Scepticism over the state’s ability to adequately allocate and manage resources is not unwarranted.

Edgard Garrido/ Reuters

The language of land: Deciphering the proposed amendments to the property clause

The National Assembly's resolution on February 27 to review the property clause resulted either in near hysteria or euphoria.

However, there is a sore lack of nuance – and in some cases, even deliberate misinformation – regarding the contents of the motion passed. It is necessary to understand these nuances, because subtle differences in use of language can have huge legal implications. For instance: it is clear that the EFF and the governing party want two totally different outcomes.

While the resolution was an EFF-sponsored motion, it is important to note that the final resolution adopted is an amended version of the EFF's initial proposal. The crux of the final resolution is to "review section 25 of the Constitution and other clauses necessary to make it possible for the state to expropriate land in the public interest without compensation, and in the process conduct public hearings to get the views of ordinary South Africans, policymakers, civil-society organisations and academics, about the necessity of, and mechanisms for, expropriating land without compensation".

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As such, the final resolution is vague – perhaps deliberately so. It throws the ball back to the South African public and demands that they fill in the gaps created by the vagueness. The wording is laced with ambiguity and lends itself to many interpretations. Hence this piece's focus on what could have been, but is not: the state as the custodian of all land.

The EFF motion stated that the "property clause makes it practically impossible for the dispossessed of their land to get justice for injustices perpetrated against them". A salient feature of the failed initial resolution is a provision that takes "into account the necessity of the state being a custodian of all South African land". It is probably this – since deleted – phrase, alongside the final reference to "expropriation without compensation", that has given the impetus for both the hysteria and the euphoria.

These conflicting responses were to the state's perceived intention to either abolish private property rights, or to make land available to all South Africans. Scepticism over the state's ability to adequately allocate and manage resources is not unwarranted, given the well-documented failings of state-driven land reform initiatives.

Point six of the original EFF diagnosis of the problems focuses solely on the property clause and the payment of compensation. This was changed by the governing party, which divided the blame between policy instruments, its "willing buyer, willing seller" policy, and "other provisions of Section 25". This is saved by the vagueness of "other provisions", should the talks show that the problem is indeed not with the first part of property clause.

For years the governing party has been talking left and walking right. And it seems to be adopting that same strategy in this case.

The governing party also deleted the allegation that "this property clause makes it practically impossible for those dispossessed of their land to get justice for injustices perpetrated against them". This is not only a mea culpa from the governing party, but they had to delete it, because the High-Level Panel on the Assessment of Key Legislation and the Acceleration of Fundamental Change report showed clearly that this is not the case.

The radicalness was further toned down when radical land reform (without compensation) was replaced with using existing state mechanisms to address the issues, and only resorting to expropriation without compensation when it would increase agricultural production and improve food security. The task was changed from reviewing and amending section 25 to make it possible to expropriate without compensation, to merely "reviewing" it and other clauses, and "amending where necessary".

The resulting ambiguity leaves the state with an exit strategy in either direction; expropriation with compensation or expropriation without compensation. For years, the governing party has been talking left and walking right. And it seems to be adopting that same strategy in this case.

Sumaya Hisham / Reuters
Julius Malema, leader of the EFF, speaks during a media briefing at Parliament in Cape Town. February 12, 2018. REUTERS/Sumaya Hisham

These subtle changes matter, because the EFF wants the removal of (presumably all) land from the sphere of private property to that of public property. Not an altogether strange phenomenon in South Africa, as this happened to a limited extent with nature (National Environmental Management Act - NEMA), but to a large extent with water (National Water Act) and minerals (Minerals and Petroleum Resources Development Act - MPRDA). In the case of NEMA, for instance, this custodianship duty covers private land.

The MPRDA that removed minerals from the sphere of private property completely has been the subject of a court case, in which the argument was that changing the nature of the property rights in relation to minerals, from private property to public (regulated by state-issued permits), was an expropriation of mineral rights and that compensation needed to be paid. The court found that since the state did not acquire any property and would merely regulate the property, a deprivation rather than an expropriation would take place, and that no compensation would, therefore, be payable.

At the time there was a debate about whether this paves the way for nationalisation without compensation. The Constitutional Court made it clear that the judgment is limited to those specific facts. It remains open, then, whether the changing of the nature of a property right from a private right to a public right controlled by the state, will be an expropriation for which compensation is payable. What the EFF foresees in its policy document, would be for the state to "administer and use land for sustainable-development purposes", and seems to signal more to nationalisation rather than custodianship.

Custodianship over land would involve a series of regulations regarding the use and enjoyment of private property, thus curtailing the entitlements currently enjoyed by private property owners.

This complete system overhaul will leave no stone unturned. All property, regardless of the class, race or status of the owner, will be transferred to the state. Here, the EFF speaks of the state both as owner and as custodian, which in law, are two different legal constructs.

If the state is the custodian of the land, it will, as in the case of the other acts, be limited by legislation that grants it custodianship to manage the land in line with the principles laid down in legislation.

In general, it is acceptable for the state to be the custodian of scarce resources, because it is presumed that the state will manage the resources in a way that benefits future generations. It is also assumed that it will provide equitable access to the resources. If this is what is implied with custodianship in the EFF policy, what "equitable access" is, needs to be explained.

What can be gleaned from the EFF policy is that land-use licences will be granted for the purpose applied for, for a duration of 25 years, if the land remains used as planned. The state holds the right to withdraw the licence and reallocate the land if so needed. This is also to prevent farming on a large scale. (Erroneously, the policy also mentions that the state can expropriate land in instances where land is not used for the purpose so applied for. The state cannot "expropriate" its own property; it would be withdrawing consent to use the land – a different process in law).

Kirkikis via Getty Images

Nevertheless, it is important to delve further into the notion of state custodianship and to distinguish it from nationalisation. The dictionary meaning of nationalisation is a "taking by the state of privately held rights with or without payment or compensation". An example is that of industries – including coal and steel – across Europe post-World War II. Suffice to say, since nationalisation involves the state acquisition of private property rights when applied to land, this would mean the effective abolition of private property, as was seen in the former Yugoslavia post-World War II.

Custodianship, in the case of the MPRDA, regardless of its merits, does not mean that the state has acquired and thus became the owner of the mineral rights concerned. The state cannot, as would an ordinary owner, use and enjoy any of these rights unfettered. The state is a mere administrator as a way of giving effect to its responsibility to ensure more equitable access to natural resources.

The state thus has an elevated duty of care, which is distinguishable from that of an ordinary owner, in that custodianship demands that the state act in the best interest of the nation. Custodianship over land would involve a series of regulations regarding the use and enjoyment of private property, thus curtailing the entitlements currently enjoyed by private property owners. The state would play an increased role in determining how private property is used. But this does not necessarily mean that the state is the "owner" in the private-law sense of ownership.

There is a need to aggressively deal with South Africa's unequal society while managing concerns such as job losses and investor confidence.

Custodianship depends on the high degree of trust between the citizens and the state – and at the moment, South Africa is operating on a trust deficit between the state and citizens. For example, the recently deposed mining minister, Mosebenzi Zwane, gave cause for distrust of the custodianship model, given the widely reported influence of external sources in the drafting and framing of key mining policies. In the context of water, state custodianship is also not always beneficial for the poor.

The Preservation and Development of Agricultural Land Framework Bill that provides for the state (in the form of the Department of Agriculture, Forestry and Fisheries) being custodian of agricultural land is two years behind schedule while its constitutionality is being questioned. There thus seems to be a reluctance on a blanket acceptance of such a model. The deletion of the word "custodianship" from the EFF motion signals a move away from such a general model for property. On this point, at least as far as we can glean from what is in the public domain, the ANC and the EFF policy differs remarkably.

Ultimately, the custodianship model has to be underpinned by transparency and accountability, in addition to well-functioning public institutions. That said, policy in South Africa's highly unequal society cannot be framed in response to poor governance issues.

There is a need to aggressively deal with South Africa's unequal society while managing concerns such as job losses and investor confidence. A nuanced understanding of the transformative nature of the Constitution's property clause, applied with fidelity, would be a good place to start.

Professor Elmien du Plessis and Ms Phephelaphi Dube