Submission by the Botanical Society of South Africa on the
Property Rates Bill: 2003

Dear Sir

Thank you for the opportunity to comment on this significant legislation. As we did previously in May 2000, we wish to draw attention to some often-neglected aspects of Municipal Rates regimes and their impact on sustainable landuse and biodiversity, especially on previously unrated rural land.

We fully concur with the intentions of the bill, and note that the choice of using "improved (market) value" is optimal from a conservation perspective. We acknowledge that municipalities must become financially viable and, where feasible, use rates policies to achieve better service provision. However, we also note that in certain cases local demands must be balanced with national interests, especially where municipal interests might conflict with national objectives.

Further, we note that past imbalances in land ownership need to be addressed, and that rates provide a means to put more land onto the market and encourage development of available land. However, we must point out some unforeseen consequences of the mechanism proposed for achieving this. These unforeseen consequences will hamper the sustainability of newly acquired black-owned land.

In many municipalities for instance, unused farm land is rated higher than developed land, thus forcing the owners to develop it or sell it off. Much of South Africa’s world renowned biodiversity occurs on farmland, and this rates policy will have dire negative consequences which will result in the unnecessary loss of this biodiversity just so the owners can pay the rates.

To illustrate our arguments, we provide an actual case of a 26ha piece of virgin land in the Kogelberg Biosphere Reserve, which has no services or infrastructure of any sort. It was served with a rates bill of R26000, forcing the owner, who had no intentions to sell or develop, to apply for subdivision and housing rights. This land was the home of two plants species not occurring anywhere else, has several other rare and threatened species, and provided one of only two links of continuous fynbos from the coast to mountains in the area.

We understand that many of the changes made to the bill since its first comment phase have been made after wide consultation and with opinion from constitutional experts. However, this has resulted in some previously positive aspects of the bill being removed or rendered insufficient with regards to promoting sustainable development and municipal support of national conservation and land management objectives. We wish to offer solutions that accommodate both perspectives.

Our comment is divided into 3 areas:
The need to protect nationally important biodiversity that resides on rateable land in protected areas not owned by the state.
The recognition that rates, correctly implemented, can send positive signals encouraging wise land management to conserve biodiversity and greater investment by private landowners in environmental management for the public good.
The need to avoid unforeseen consequences of the bill acting as perverse incentives for undesirable actions that promotes the unnecessary loss of biodiversity.

1- Nationally important biodiversity on private protected areas must be exempt from rates

Previously, land contractually incorporated into a National Park was exempt from municipal rates. This encouraged landowners to make their land available for the national interest in a very cost effective manner. It set the precedent that such land could not be encumbered with municipal rates if inclusion in the protected area was in the public good. Obviously, any services provided would still be charged for.

With a new framework for protected areas in SA (the Protected Areas Bill 2003) the recognition has come that land (and its attendant biodiversity) which is important to the nation as a whole is often in private ownership, and the bill caters for this to be incorporated into national and provincial protected areas.

However, the wording of the clause in the rates bill (draft 16 - S 15 (2) (e)) effectively disallows a municipal rate exemption for private land contractually bound into a national or provincial protected area. This will prevent South Africa from meeting its objectives in terms of expanding its protected areas to be key economic drivers in many marginal areas. In the Cape Peninsula National Park, for example, some properties earmarked for inclusion in the park actually pay higher rates than residential land, or are encouraged through a local rates policy to start farming if they want any rebates. This will lead to an unnecessary loss of globally important biodiversity.

We recommend: Deleting the words "State land" from clause 15 (2) (e) and replacing with "any land"

2- Encouraging sustainable and wise land use with rates

Alien invading plants are not only a key threat to South Africa’s biodiversity, but are responsible for much damage to property, and even loss of life, in wildfires. South Africa has not been very effective in encouraging people to invest in clearing invasive plants and the problem is getting worse.

The use of innovative means such as a differential rate for those properties certified as alien free, would send a very strong signal to landowners, and alter the economics of clearing aliens. Significant jobs would be created not only in clearing aliens, but also in the monitoring and auditing of this at municipal level. Greater investment in sound land management would be obtained from landowners.

Other sound land management actions could similarly be rewarded by those municipalities would might stand to benefit. For instance fire belts in vulnerable areas if properly maintained should attract a rate rebate from municipalities.

Previous versions of the Rates Bill provided for a national framework where the National Minister could promote these innovative mechanisms instead of each municipality needing to develop these schemes internally. This framework has been removed, and with it any opportunity to allow National guidance for using municipal rates to achieve other socio-economic objectives.

We recommend: Either, reinstating the national framework outlined in drafts 1-12 for guiding exemptions, (provided constitutional problems are rectified),
Or,
Creating the opportunity for the Minister to promote certain guidelines to Municipalities to encourage sustainable development and landuse, in collaboration with Ministers of Agriculture, Land Affairs, Environmental Affairs, and Water Affairs and Forestry. Formal consultation with organised local government could also be catered for.

3- Eliminating perverse incentives which will lead to unnecessary biodiversity loss

Municipal valuation of property can lead to many unforeseen consequences if the true costs of statutorily required land management are not taken into account. For instance, a landowner might allow unused parts of a property to be overrun with aliens in the knowledge that this would reduce the property’s value and thus result in lower rates to be paid. This is a perverse incentive encouraging poor landuse, wasting natural resources and will work against other government objectives, particularly those of the national Working for Water and LandCare Programmes.

We suggest: In S 38- 40 of the bill, the valuation criteria could include a specific item that does not allow the value of a property to be reduced (for rates purposes) by the presence of alien vegetation, land degradation or similar occurrences.


The Botanical Society would welcome any opportunity to explain these concerns and technical considerations to either the Parliamentary Committee or Departmental representatives. More detailed proposals for alternative wording of relevant clauses will be provided to the Committee during the public comment phase.


Yours faithfully




Mark Botha Bruce McKenzie
Conservation Partnerships Director