EXPROPRIATION OF LAND
INTRODUCTION
At its 54th national conference in December 2017, the ANC resolved to expropriate land without compensation. As a result the matter has been referred to the Constitutional Review Committee, which is expected to share their recommendations and findings by the 31st of August 2018 as to whether section 25 of the Constitution needs to be amended.
The purpose of this article is to provide some insight into the expropriation of land issue which is currently dominating SA media.
SECTION 25 OF THE CONSTITUTION - THE LEGILATIVE BASIS FOR EXPROPRIATION
Section 25 of the Constitution of the Republic of South Africa, often referred to as the ‘property clause’, forms part of the Bill of Rights and has 9 subsections, unpacked or explained as follows:
(1) No one may be deprived of property except in terms of law of general application, and no law may permit arbitrary deprivation of property.
This indicates that expropriation will only be allowed if it is done in terms of law or legislation applicable to all within the country and achieved in a manner that is not irrational and with good cause.
(2) Property may be expropriated only in terms of law of general application –
(a) for a public purpose or in the public interest; and
(b) subject to compensation, the amount of which and the time and manner of payment of which have either been agreed to by those affected or decided or approved by a court.
This clause provides that compensation must be payable for expropriation of land and should the parties not be able to agree on the amount of compensation, the court may make a ruling in this regard. Many argue that this clause is sufficient to provide for expropriation without compensation provided the parties agree on no compensation or the court makes a ruling to this effect.
(3) The amount of the compensation and the time and manner of payment must be just and equitable, reflecting an equitable balance between the public interest and the interests of those affected, having regard to all relevant circumstances, including –
(a) the current use of the property;
(b) the history of the acquisition and use of the property;
(c) the market value of the property;
(d) the extent of direct state investment and subsidy in the acquisition and beneficial capital improvement of the property; and
(e) the purpose of the expropriation.
These are listed elements that the parties must bear in mind during their negotiations for compensation, and if necessary, the factors the courts must clearly consider when ruling on the amount of compensation due for expropriation.
(4) For the purposes of this section –
(a) the public interest includes the nation’s commitment to land reform, and to reforms to bring about equitable access to all South Africa’s natural resources; and
(b) property is not limited to land.
This section clearly underlines the necessity of land reform and the need for equity and fairness in light of the past injustices related to racially discriminatory laws. This section furthermore provides that land reform does not need to be limited to land and may include built up properties and natural resources.
(5) The state must take reasonable legislative and other measures, within its available resources, to foster conditions which enable citizens to gain access to land on an equitable basis.
We see the key terms of ‘reasonable’ measures and ‘equity’ being underlined once more, emphasising that these processes should not be achieved in an arbitrary fashion, but instead in an honest and impartial manner.
(6) A person or community whose tenure of land is legally insecure as a result of past racially discriminatory laws or practices is entitled, to the extent provided by an Act of Parliament, either to tenure which is legally secure or to comparable redress.
This section confirms that those who are left without a home or land as a result of racially discriminatory laws, are entitled to legally secured tenure (e.g. legal right to occupation) or to comparable restitution.
(7) A person or community dispossessed of property after 19 June 1913 as a result of past racially discriminatory laws or practices is entitled, to the extent provided by an Act of Parliament, either to restitution of that property or to equitable redress.
This section addresses those who were ejected from their homes and land after 1913, and clearly indicate that these parties are entitled to claim their properties back or be compensated for their loss.
(8) No provision of this section may impede the state from taking legislative and other measures to achieve land, water and related reform, in order to redress the results of past racial discrimination, provided that any departure from the provisions of this section is in accordance with the provisions of section 36(1).
(9) Parliament must enact the legislation referred to in subsection (6).
These sections empower and guide lawmakers to address land reform and expropriation within legislation, provided such legislation does not infringe on the right in the Bill of Rights unless such limitation is in terms of law of general application, to the extent that the limitation is reasonable and justifiable in an open and democratic society based on human dignity, equality and freedom, and taking into account all relevant factors, including the nature of the right infringed, the importance of the purpose of the limitation; the nature and extent of the limitation; the relation between the limitation and its purpose; and provided there are no less restrictive means to achieve the purpose.
WHY IS EXPROPRIATION ON THE AGENDA?
Different programs currently exist within South Africa for the purpose of protecting and restoring rights to property, including the Land Claims Court, upgrading of rights of leasehold to rights of full ownership, and the redistribution of land through the provision of RDP housing by municipalities. However, despite these efforts South Africa’s land reform is widely regarded to have failed since 1994. It is argued that government is feeling pressured to fast-track the process and to use expropriation without compensation as a means to promote land ownership and wider participation in the agricultural sector by previously disadvantaged groups.
WHAT WILL BE REQUIRED TO AMEND THE CONSTITUTION?
Should amendment of the Constitution be required, such amendment will need to be accepted by at least six of the nine National Council of Provinces and about 67% majority vote by the National Assembly. However, should it be argued that that the changes to section 25 may infringe on the founding values of the Constitution, a 75% majority vote will be required by the National Assembly.
Finally, should this motion be passed, a white/green paper outlining the policy proposal will be developed and engagements with lawmakers, attorneys and the public will have to commence across South Africa.
WHAT KIND OF PROPERTY WILL BE AFFECTED?
There is no certainty on which land will be affected by expropriation policies, however in his State of the Nation Address, President Cyril Ramaphosa confirmed that expropriation will be done in a manner that doesn’t harm the economy and food security.
The President has also reiterated that government would not tolerate land grabs and have in the previous months ordered police to stop land invasions in Orange Farm and Blue Hills, Johannesburg. It is worth noting that the agricultural sector’s debt amounts to approximate R144 Billion in 2016, hence the burden to the State might be vast as it would have to buy agricultural land that is bonded and first satisfy such debt before expropriating the land without compensation.
WILL RESIDENTIAL PROPERTY BE AFFECTED
Whilst there is much hype around this, such hype is mischief making by politician and interest groups for their own gain. Residential property in general will not be affected.
HOW LONG WILL IT TAKE
It is expected that expropriation without compensation will take years to be implemented in South Africa. This is due to the fact that various pieces of legislation (e.g. National Credit Act and Expropriation Act) will need to be amended to align with such policies, and that legislation providing for just and equitable expropriation is expected to be appealed all the way up to the Constitutional Court
CONCLUSION
To the extent that section 25 is amended, it will not affect residential property and will be done in a manner that does not harm the economy.