SUBMISSION TO THE PORTFOLIO COMMITTEE ON POLICY FRAMEWORK: WILLING BUYER - WILLING SELLER

Introduction:

At the beginning of 2004, President Thabo Mbeki, in the ANC election manifesto, committed himself and the government to:

Reduce poverty by half through economic development, comprehensive social security, land reform and improved household and community assets (page 5 of ANC Election Manifesto).

It is our view that this commitment can only be realised if there is an immediate review of the policy framework that governs land redistribution.

At different levels, several newspapers these past weeks reported on the lack of finances and problem of delays facing two pillars of the land reform programme viz. restitution and redistribution. On 11th October, in the newspaper ThisDay, Mr Tozi Gwanya stated:

"The issue of exorbitant land prices is a serious challenge affecting all three land reform programmes. Land prices have varied between R450/ha and R50 000/ha, the average price being R2 944/ha. This is making land reform unaffordable. Aggravating factors include the purchase of strategic tracts of land by foreigners, especially in the coastal areas of KwaZulu-Natal, the Eastern Cape and the Western Cape, as well as in Mpumalanga and Limpopo. Most of that land is used for game parks, golf courses, eco-tourism or private homes.

Another factor is land speculation, where those who have the money buy land, only to resell the same at a handsome profit. In some urban areas such as Simonstown, land has become so expensive that South African citizens, both black and white, struggle to afford it at all.

These challenges as well as the pace of land reform (2,9% in ten years) clearly indicates the necessity for government and especially DLA to critically question the main political framework that underlie land reform in South Africa.

South Africa’s Market –Led Agrarian Model:

The government, in selecting its policy options and guidelines for the transformation of apartheid land ownership patterns and to redress colonial and apartheid dispossession, chose a market-assisted, market-led, demand-driven approach. It is important for us to ask how it came about that we selected a market-led land reform approach rather than searching for other options more suited to helping us to overcome the legacy of our past. In fact given that dispossession in this country was led by the state, one would expect the new democratic government to have played a far more proactive role in restoring land to the dispossessed. A state-assisted and state-led agrarian reform program is what most of us expected. Instead, the government opted to follow the advice of the World Bank, other international institutions and agri-economists that have been active in commercial agriculture. Two World Bank researchers, Deininger and Binswager, who worked with South Africans in developing the market-led approach stated: "most land reforms have relied on expropriation and have been more successful in creating bureaucratic behemoths and in colonising frontiers than in redistributing land from large to small farmers (1999, 267).

From this statement it is clear that the aim is to prevent expropriation, and that the underlying economic perspective is that of we should guard against creating a bureaucracy and corruption at all costs.

In government’s general motivation for this approach, an approach that appears to be similar to other countries where market led land reform has been applied, it is clear that they want to ensure: maximum co-operation from landowners and commercial agriculture as this is critical if there are to be willing-sellers. Government has therefore made it clear that:

Government’s role is therefore to ensure that the "market" is protected and not volatile. They have to establish the legal, institutional and a policy framework to level the playing or "ploughing fields" and to provide the financial and support services to ensure that land is redistributed on demand.

To a large extent this is the framework and the approach that has been implemented in South Africa for the past decade. It is therefore appropriate that we now ask whether this market-led approach has in fact worked in South Africa and whether it has in any way overcome the historical legacy of dispossession and apartheid prohibitions on land ownership.

The answer is a very clear NO! There is sufficient evidence (and acknowledgment by the officials of the DLA, Commission on Restitution etc) to indicate that the 2,9% of land redistributed during the past 10 years is too slow, too little and has done nothing to change land ownership patterns in South Africa. Instead, as we heard from Chief Commissioner Gwanya, there has been massive speculation in land, sharp increase in land prices and in regions like the Western Cape and other prime agricultural zones there have been no willing-sellers nor any change in landownership.

In many cases it is only small and medium sized under-utilised farms or farms in marginal/remote areas, like those bordering on the Transkei and Ciskei, that have been sold and transferred to rural groups who have applied to the DLA via the LRAD programmes. An overview of land transferred will show that it is mainly remote, under-resourced and/or bankrupt farms that have come onto the market.

In December at the Peoples Tribunal on Landlessness and Rural Poverty organised by the Trust for Community Outreach and Education (TCOE) in Port Elizabeth, community groups from Muldersdrift in Gauteng, Sundays River Valley and other prime agricultural areas gave concrete evidence regarding existing reluctance to sell and the ongoing racism that prevents community groups from purchasing land. Evidence also clearly showed the high levels of frustration at the slow pace of reform and the lack of respect that poor rural communities are shown. Many feel that they are now no better off than before and that the government is incapable of anything more than empty promises.

What are the alternatives?

For South Africa to overcome rural poverty, decades of underdevelopment and the historical legacy of deliberate prohibition and century long skewed support to white commercial agriculture, it cannot utilise a framework that is biased towards the market and a framework that protects private property and maintains the apartheid status quo.

Our starting point must be that the vast majority of black people living in the rural areas are living below the poverty line. 70% of all poor people live in rural areas and it is estimated that rural unemployment is above 50% (Aliber, 2003). Besides being poor and unemployed rural communities are also ravaged by the HIV/Aids pandemic, lack of access to basic services and infra-structure and have continued to act as the support system for those who fall out of the migrant labour system and those who are pushed off commercial farms. These factors alone are sufficient to suggest that an urgent solution is needed to address the crisis. It is therefore necessary to ask why, when these urgent and dismal conditions exist, do we consider the willing-buyer, willing-seller approach to be an appropriate one.

We should be asking how land and agrarian reform can be utilised to overcome rural poverty and underdevelopment. Our primary concern should be how land can be used to overcome the problems created by apartheid. Instead we seem to be more concerned about how we can ensure co-operation and compliance of white commercial agriculture. In fact we have all seen how much commercial agriculture has gained and how their interests have remained protected even under the ANC government.

Our view is that we require an agrarian reform that is truly redistributive, one that is based on social justice, historical redress and economic development. The market cannot carry out a redistributive function, but the state can and should.

Proposals:

In line with the motivation above and the experience we have gained from working with the rural poor in SA for more than 20 years, we propose that: