GOVERNMENT’S POLICY ON STRENGTHENING THE RELATIVE
RIGHTS OF PEOPLE WORKING THE LAND: INCLUDING THE 50%
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PROPOSAL AND SIZE OF LAND OWNERSHIP CEILINGS
LEGISLATION
• Since the re-election of the current Government, there has
been a marked increase from Government’s side to continue
with, and with considerable vigour, the restitution of land.
• The Minister has published a draft but final policy proposal on
Strengthening the Relative Rights of People Working the Land
dated 21 February 2014. It is this policy that has given rise to
the farming sectors outrage at a proposal that up to 50% of a
farm can be expropriated without direct payment to the owner
i.e. expropriation without compensation.
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• The bottom line of Government’s Land Reform Proposals is as
it appears in the last paragraph of the 50% proposal which
states as follows,
“The moral basis for these proposals is that fellow South Africans
who benefited from the proceeds of the land dispossession wars
and the race based segregation policies and laws of successive
colonial and apartheid regimes have a moral duty and
responsibility to contribute to the restoration of justice and
national reconciliation efforts. Secondly, maintaining the current
status quo is politically undesirable and unsustainable.”
The following specific Acts are relevant:
•
On 1 July 2014 the President signed into Law the Restitution
of Land Rights Amendment Act, Act 15 of 2014. It provides
for the reopening of the process to lodge a land claim and
such period has now been extended to 30 June 2019 i.e.
there is another 5 years for individuals and/or communities to
put in land claims. It also provides for and creates certain
offences and penalties if there is contraventions of the
Restitution of Land Rights Act;
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•
Also on 1 July 2014 the President signed into Law the Property
Valuation Act, 17 of 2014. This Act provides for the established
of the office of the Valuer General, provides the mechanism for
the valuation of property that has been identified for purposes of
land reform and the purpose is to give effect to the provisions of
the Constitution which provide for land reform and facilitate land
reform through the regulation of the valuation of property;
•
The upgrading of Tenure Rights Act, 112 of 1991;
•
The extension of Security of Tenure Act, 62 of 1997;
•
The Interim Protection of Informal Land Rights, Act 31 of 1996;
•
The Commercial Properties Association Act, 28 of 1996;
•
The Expropriation of land Act, 63 of 1975;
•
The Restitution of Land Rights Act, 22 of 1994;
•
The Abolition of Racial Based Land Measure Act.
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•
•
Five new Acts are proposed for 2014 these are:
•
The Communal Property Association Amendment Bill;
•
The Communal Land Tenure Bill;
•
Extension of Security of Tenure Amendment Bill;
•
The Regulation of Lands Holding Bill;
•
The Election Deeds Registration Bill;
•
The Promotion and Protection of Investment Bill 2013.
As you can see, it is a variable minefield of legislation and
proposed legislation to deal with land restitution.
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•
WHAT ARE THE MAIN ISSUES
RELATING TO LAND REFORM?
The State’s ability to deprive someone of property:
•
Section 25 of the Constitution provides for circumstances
where the State can deprive a land owner of property.
Deprivation of property can occur without compensation.
However not all deprivation of property is an expropriation
explained hereunder.
•
Deprivation of property means that the State can limit a farm
owner’s rights in terms of what he can or cannot do with this
property. For example the registering of servitudes in the
name of the Government which happens on each property
transaction. The State can also limit your rights for example
determining what the building lines are next to a highway or
similar circumstances.
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•
A land owner has no right to compensation if he is deprived of
property unless that depravation is equal to an expropriation.
Not all depravation equals expropriation however all
expropriation does amount to depravation of property.
•
Deprivation of property is lawful on condition that the decision
made to deprive someone of property is rational and relating
to the purpose of which the power was given. Such
deprivation may therefore not be arbitrary;
•
Section 25 of the Constitution also allows for expropriation of
property. Our Constitution guarantees no expropriation
without compensation. This means that the State cannot
lawfully take over property unless it pays for it. The Minister’s
50% proposal is indeed an expropriation attempt to
expropriate 50% of a farmers farm without compensation.
Consequently his proposal is unconstitutional.
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•
WHAT THE MINISTER IS ASKING
THE ORGANISED AGRICULTURAL
INDUSTRY TO AGREE TOO?
•
What the Minister is asking the organised agricultural
industry to agree to?
•
Is to agree to give up 50% of their farms without being paid
for them;
•
The entire agricultural industry must object to this proposal
of the Minister as it “flies in the face of the Constitution”.
The 50% ownership proposal:
•
The Minister is proposing that a current owner will retain 50%
of his farm and what he wants farmers to do is to give away
the other 50% to his workers who acquire ownership of
portions of the farm depending on the length of years of
service;
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•
The State will acquire the ownership of the 50% not retained
by the farm owner. In lieu of compensating the farmer for the
loss of 50% of his farm, the State will pay money into a fund
and the purpose of the fund is to finance the upliftment and
education of farm workers to enable them to farm the land.
What is proposed is that workers who have been employed
for 10 years get 10% of the workers’ half of the business.
Those employed for 25 years get 25% of the 50% and those
employed for 50 years get 50% of the 50% to be allocated to
the farm workers. Those that have been working for less than
10 years get nothing.
•
To date all the AGRI members and all AGRI geared business
including the financial institutions have all rejected the
Minister’s proposal as being unworkable. That proposal is
unworkable for a number of very important reasons. The
main ones being:
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•
 Most farms already have land claims on them;
 With the reopening of the land claims process those that do
not yet have claims will have land claims on them soon;
 It is therefore impossible to implement the Minister’s proposal
because farms cannot be divided, sold or in any way
tampered with during a land claims process without the Land
Claims Commissioner agreeing to such changes;
 The intention is to expropriate without compensation
which is unconstitutional;
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 Most farms are bonded for capital and, the organised
financial banking industry cannot agree to the proposal
as it is unworkable. The proposal includes that the new
owners get the land free of debt.
At the recent Land Summit held between the 3rd and the 6th of
September 2014 the Minister also brought to the table the
question of land ceilings. This was first considered in a
green paper of October 2012The State land audit has been
completed. According to this audit approximately 23% of land
in the country is owned by the Government. The land ceiling
proposal is that:
•
the majority of land should be held by the State and the State
can lease the land out on 30 year leases.
•
Foreigners will not be allowed to own land but will only be
able to lease land.
•
Land that is held by private individuals or private entities will
be regulated as follows:
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•
 A small enterprise may not hold more than 4000 hectors;
 A medium size enterprise 4000 to 8000 hectors; and
•
A farmer that holds more than 12000 hectors would be
required within a period of (let’s say 12 months) to hand over
the other land to the State. At this stage the proposal is that
the handover will be accompanied with payment of
compensation.
•
There are no guidelines as to what a small, medium and large
enterprise is.
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 A large enterprise 8000 to 12000 hectors.
•
Government will shortly be issuing a Bill which has the
intention that all land owners will have to declare inter alia:
 What their race is;
 Their gender; and
 The amount of land owned;
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• The intention will be to take that information to determine
which farms are to be targeted with regarding to the Land
Ceiling Proposal and possible expropriation.
•
Government and the organised agricultural industry are at a
stalemate. It is this stalemate that has lead the Minister to
call on all South Africans to make proposals to him on how to
resolve this rather problematic issue. The reason why we are
here today is to decide what the Sabie Valley consortium
wants to do.
•
The main areas of contention and differentiation between
Government and the organised agricultural industry are the
following:
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WHERE ARE WE IN THE LAND
REFORM PROCESS EXCLUDING
LAND CLAIMS?
1. FOR:
1. AGAINST:
The Minister is of the view that the policy that he has
proposed i.e. that as much as 50% of the person’s
farm can end up in the hands of the farm labours is
needed. Ownership of the farms or part of the farms
must move to the labourers.
The Minister’s latest policy is not
required. There is no place for such a
policy in a system where there are
already Agricultural BEE Codes, Share
Ownership Schemes and Empowerment
Schemes.
Farmers will not be compensated for that portion of
the farm that goes to the labourers but rather that
Government will put the money which would have
been paid to the farmers into a Fund which is to be
administered by the Government with the intention of
using the funds to uplift black farmers.
The Minister is of the view that Share Ownership
Schemes and BEE Empowerment Schemes have not
worked.
As opposed to the Minister’s policy they
are of the view that these current BEE
and Share Ownership Schemes can offer
better result than the Minister’s policy of
taking as much as 50% of the farm and
giving it to the labourers.
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It is quite interesting that in an article written by RUTH
HALL on 8 September 2014 when she addressed the
Land Summit, she recorded that of the 88 Farm Equity
Share Projects implemented between 1996 and 2008
only 9 of those have declared dividends and of those 9
the dividends declared were between R 200 and R
2000 per year. No wonder Government does not
believe that these proposals are sound.
2. FOR:
2. AGAINST:
The policy will lead to
transformation of the farming
sector, will stabilise food
security and will improve the
tenure of farm labourers.
The proposal threatens food security, will
lead to substantial job losses, reduce
confidence in the agricultural sector and
will lead to disinvestment by foreigners in
South Africa.
As you know, the 50% advocates that
labourers who have less than 10 years
employment are not entitled to anything.
The incentive is therefore large for farm
owners to simply get ride of farmers in
the ninth year i.e. to avoid them getting
10 years tenure which then enables them
to qualify in terms of the 50% proposal.
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As opposed to the Minister’s policy they
are of the view that these current BEE
and Share Ownership Schemes can offer
better result than the Minister’s policy of
taking as much as 50% of the farm and
giving it to the labourers.
3. AGAINST:
The Minister has already stated
that he will not consider AGRI
Villages as an alternative to his
policy proposal as this simply
leads to further segregation
which is not what Government
wishes to achieve.
If there is an intention to
improve farm workers living
conditions then AGRI
Villages provide a better
alternative to what the
Minister is proposing.
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3. FOR:
4. AGAINST:
The problem is that within the
Macadamia Nut Industry
there is no land available to
purchase with the intention of
trying to establish AGRI
Villages. Existing
Government owned land is
already over populated or
held for strategic purposes
and therefore it is impossible
to suggest to Government
that the land should be used
to establish AGRI Villages.
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4. FOR:
5. AGAINST:
The policy that has been put
forward must be legalised,
legislated and made
compulsory.
It is not possible to make
the policy compulsory and
compliance with the policy
must be voluntary. If the
Minister intends to make
the policy proposal legally
binding and compulsory
farmers will simply
disinvest in their farms.
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5. FOR:
6. AGAINST:
Those that are to benefit by the
policy should not be
responsible for the previous
debt of the farm owners.
The proposal is unworkable
because farms have been
bonded for working capital.
Consequently if the
Minister’s proposal is to
work those getting the
asset must also get the pro
rata liability attached to the
land.
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6. FOR:
7. AGAINST:
The policy that Government is
proposing must work
retrospectively.
The policy proposal cannot
work retrospectively or
going forward for that
matter. The policy is
rejected.
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7. FOR:
In a nutshell the following:
• Government’s policy dictates, and appears to be a nonnegotiable that part of the land (50%) must be transferred
to the labourers. The current Share Ownership Incentives
and Empowerment Schemes are not working and will not
work and are not alternatives to the policy proposals.
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• Against this the organised agricultural industry maintains
that the proposed policy will not work and the only way to
achieve what the Minister wants is to improve Share
Ownership Schemes and Empower Schemes.
•
One must work harder at implementing the AGRI BEE Codes.
•
Share Incentive Schemes must be improved thereby giving
labourers part of the business (not necessarily the land).
•
Look at State owned land and convince Government to rather
utilise State owned land better.
•
Move labourers on to State owned land and create AGRI Villages
and the AGRI Industry will then support the Minister by providing
training, transfer of skills, and other supplementary services to
assist with the upliftment of farm labourers;
•
Consider suggesting to the Minster regarding land which was
expropriated in terms of the Land Restitution Act, which land has
now fallen into disuse, stands unused and is unproductive.
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THE FOLLOWING ALTERNATIVE
PROPOSALS HAVE BEEN MUTED?
• It appears from the Minister’s comments and things that he has
done, that the land that has been reclaimed and expropriated
at great cost to Government in terms of the Land Restitution
has not been very successful. We all know of examples where
such land was reclaimed and now stands in ruins. It seems
that the most logical way to try and solve the land crisis issue
is to recapitalise such land, implement proper controls and
restore the land to be productive again.
• The agricultural industry can offer assistance to the Minister on
how this can be done. Examples exists. The recapitalisation
must come from Government. However there are a number
of auxiliary things that will need to be done and it is here that
the mac nut industry can play a roll, including inter alia:
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 Educating farm labourers on how to run a business;
 Educate farm labourers on the best farm practice;
 Skills transfers to labourers to help them to become
profitable;
WHAT CAN THE MACADAMIA NUT
INDUSTRY DO?
As you know Government has asked all South Africans to come up with
proposals. The following is suggested and the floor will be opened up for
debate for other suggestions:
•
1st : A mandatory objection to the Ministers proposal is required,
both with regards to the 50% proposal as well as the Land Ceiling
Proposal. You simply cannot give away a Constitutional Right
guaranteed by the Constitutional, and it is my recommendation that
you object most strenuously to the Minister’s proposals of expropriation
without compensation
•
2nd : The principle of right of first refusal should be mandatory. If a
farmer wants to sell his farm it should be compulsory for the farmer to
first offer his farm to Government.
Government will have the
opportunity to buy the farm at the market value for a certain period of
time. This is the model currently applied in Namibia. Considerable time
and effort will have to be spent on improving on that model, but the
basic principle appears to be sound.
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•
3rd : Although Government has invited suggestions and alternative
proposals to its policy, it has become quite clear that what the Minister
wants is for the industry to come up with suggestions as to how he can
implement the policy he has put forward i.e. he does not want to change
the policy but wants suggestions as to how his policy can be
implemented. It is therefore mandatory that an objection must be lodged
against the Minister’s policies.
•
4th : The only possible option is for the Macadamia Nut Farmers to put a
proposal forward in which it offers technical as well as farming skills
support i.e. transfer of skills to labourers who will be the beneficiaries of
recapitalised land which has already been expropriated by the State and
which has currently fallen into disuse.
•
Of course it may be that the Mac nut industry decides to simply object
and not offer anything nor make any proposals. This can be debated. It
seems to me that simply objecting only has the benefit of telling
government that like all other AGRI participants the Mac farmers also do
not support his proposals.
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•
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 Information to be added here following an open floor
debate:
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