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04/04/2018 17:13 SAST | Updated 04/04/2018 18:23 SAST

Land Reform: The 'Greedy' Are In The Firing Line

The concept of expropriation without compensation remains a deeply flawed and damaging one.

Martin Acosta/ Reuters

Uncertainty is a prime enemy of business and economic growth. So we are often told, at any rate. If any light can be shed on the great shadow that is land reform conducted via expropriation without compensation (EWC), then the deliberations among the exclusive attendees of the National Forum for Dialogue on Land, Heritage and Human Rights (go on, acronym that!) might prove to have some value for the broader uninvited public. Not least this author.

Intentions seem at least very certain. Minister of Rural Development and Land Reform Maite Nkoane-Mashabane declared with theatrical flair that "we are coming for expropriation" and that the first targets of the brave new policy had already been identified – although, as with any good theatre, she left suspense in the air by declining to identify those so targeted, lest they prepare to defend themselves.

Gallo Images / Netwerk24 / Felix Dlangamandla
Dr Nkosazana Dlamini-Zuma with Maite Nkoane-Mashabane during the ANC elective conference on December 18, 2017 in Johannesburg.

But even now – very now! – her department was putting together a case to begin seizing land without compensation. It would wait for no parliamentary process, neither any constitutional amendments nor the much-vaunted consultation process.

(She also made comments about Nelson Mandela's birthday, jam and living in Brussels; but that's another story.)

Deputy public works minister Jeremy Cronin played a more Socratic role, offering some thoughts on where the ANC was heading. He said that the ANC was leaning towards leaving the constitution intact. He indicated that EWC should be limited to particular circumstances – such as when a property was abandoned or where land was held for speculation. He even rebuked the EFF for their stance on the wholesale nationalisation of land, emphasising that black property owners would take a blow if that happened.

The concept of EWC remains a deeply flawed and damaging one, and the conditions set down by Mr Cronin could be creatively stretched to enable the state to perform great mischief, but there was a notable pullback from the extravagant language of a Garden of Eden that characterised earlier enthusiasms. And it says something when one of your most visible communists takes a semi-accommodating position on property rights...

There may well be a legitimate democratic debate about land use, about market dominance and the concentration of ownership. But this requires a two-way exchange of ideas...

Then there was the usual boilerplate about how this process would not harm the economy (the fine print on this minor detail is still to be worked out) and how lawlessness would not be tolerated (somewhat ironically, given what has been taking place in various spots around the country).

Former ANC secretary-general, and current mineral affairs minister Gwede Mantashe put in a performance that was perhaps more meaningful. Journalist Steven Grootes made the observation that he seemed to provide some pointers as to whose land is in the firing line. That is perhaps the million-dollar (or GDP-negating) question.

For the greedy folks, apparently.

'When a person is greedy and takes every piece of land for himself, that person should be the first for expropriation, because he doesn't need land,' Mantashe said. He went on to remark on an unnamed transgressor of this principle who has apparently been buying up farms around Queenstown. This farmer would be one of the first candidates for expropriation. Greed needed to be combated.

Greed is a moral sin – for those with an appreciation of Christian theology, it is a deadly sin, although it is unlikely that Mr Mantashe was channelling St Thomas Aquinas. It is, however, not a crime. Neither were the actions of Mr Mantashe's frenetic land purchaser. And greed, as with any sin, is a devilishly difficult thing for the blunt instruments of government action to combat. All that policy and law can realistically hope to do is to restrain the actions that arise from it.

Ultimately, it was the actions of Mr Mantashe's purchaser that seem to have bothered him just as much as his supposedly sinful impulses. More than that, there didn't even seem to be any suggestion that the purchaser was holding land for speculation, or not using it properly. Was he collecting it for funsies or building a value-adding agribusiness? Rather, it was the act of acquisition – excessive acquisition – and the growing landholdings that were deplorable. Enter EWC...

If this rings a bell, it should. Back in 2011, the Green Paper on Land Reform introduced the idea of land ceilings, land is a limited and finite resource, and therefore needing to be shared. One proposal was that privately owned land would be owned as "freehold, with limited extent". In other words, the government would restrict just how much any owner could hold.

Farming is a tough, competitive and not very lucrative business. Economies of scale are typically a necessity for survival.

This was then developed in the 2013 Agriculture Landholding Policy Framework, which proposed lower "floors" and upper "ceilings" on agricultural land. It was given draft legislative form in the Regulation of Agricultural Land Holdings Bill, released for comment last year. These measures were entirely in line with Mr Mantashe's concerns.

The operative concept here is land ceilings. As much commentary over the past year has noted, these would force farmers to dispose of their excess land. This would provide, in theory anyway, a mass of land that could be used for redistribution (or simply be sat on, if some of the current administrative pathologies are allowed to fester). Suitably empowered with EWC, the government could take this gratis.

It's unclear how the "mega-farmers" who attended the dialogue would feel about this.

Martin Acosta / Reuters
REUTERS/Martin Acosta

Also unclear is just how well thought-out this suggestion is. Growth is a sign of a successful enterprise. There seems little reason why the expansion of an agribusiness should be seen as blameworthy, while the growth of, say, a cement manufacturer or a supermarket chain is applauded. And as long as we want to centre the ideas of "need" and "greed", we could ask whether businesspeople – Johan Rupert, Nicky Oppenheimer, Tokyo Sexwale, or indeed Cyril Ramaphosa in a previous incarnation – actually need all of their business interests? Whether anyone "needs" any given resource is a matter of perspective.

Indeed, the consolidation of farms into larger units is a phenomenon observed in various contexts around the world, from Canadian wheat producers to Dutch tulip growers. It's true even in France, where support for farming is seen as much as a preservation of the pastoral heritage and a statement of national independence as a means to guarantee foodstuffs. The reasons are quite simple: farming is a tough, competitive and not very lucrative business. Economies of scale are typically a necessity for survival.

Research into U.S. agriculture shows that smaller farms often depend on the non-farm income to survive – effectively, this subsidises the crops and livestock. One commentary commented on this: "A bigger farm isn't just slightly safer, it's the difference between being likely to fail and likely to succeed. With the safety all on the side of numbers, it's no wonder that we're seeing more farmers just getting out of the game altogether or getting bigger to try and survive."

Precisely these dynamics have been identified in South Africa. Whereas the country had more than 60,000 commercial farmers in the mid-1990s, this now stands at some 35,000.

If anything, this suggests a narrative of land reform locked in a paradigm of numbers, percentages and distribution strategies...

And while government's own Agriculture Landholding Policy Framework endorsed land ceilings, it also noted a number of lessons from experience elsewhere, some of which would appear to argue strongly against the wisdom of attempting to implement such a regime. The determination of optimal sizes needed to be carefully calibrated so as to guard against both undermining production and concentration of ownership.

Extensive support from an honest and effective state would be needed, as would the cooperation of landlords. So would security of title and ownership of the land, where necessary – the latter being something that flies in the face of government's current land redistribution policy, which is that beneficiaries will generally not get to own the holdings to which they are assigned.

Whether the state could offer much of this sort of expertise or support is doubtful. Professor Ben Cousins of the Institute for Poverty, Land and Agrarian Studies – and hardly an opponent of land reform – had this to say: "To imagine that officials who have never farmed themselves could designate landholding sizes that make economic sense in South Africa today is a fantasy. The task itself is probably inherently unfeasible, but it is definitely beyond the capacities of department of rural development and land reform officials at present."

There may well be a legitimate democratic debate about land use, about market dominance and the concentration of ownership. But this requires a two-way exchange of ideas, the collection of evidence, and not cheap moralising. This is not simply a question of faux politeness or pro-forma "consultation". It is part of trying to understand what is possible in the grubby realities of the world we live in, not of our ideological and political fantasies.

But if anything, this suggests a narrative of land reform locked in a paradigm of numbers, percentages and distribution strategies, driven by the highly doubtful notion that the big issue is the quantum of land that is available and the numbers of people that can be matched up to this. That is a political goal – whether it is a viable agrarian one; well, that's a discussion we need to have. And that's for certain.

Terence Corrigan is a project manager at the Institute of Race Relations (IRR)