A risk in the coming week- South Africa

A risk in the coming week- South Africa

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In the coming days, on the 14th to be precise, the Parliamentary Committee on Public Works and Infrastructure will decide on the wording of the New Expropriation Bill.

If Expropriation without Compensation is to become a significant part of the government’s policy arsenal, this piece of legislation will be a primary weapon to achieve it.

Although lacking the flair and drama of the constitutional amendment – with all the implications of resetting South Africa’s constitutional order and the relationship between the citizen and the state – the adoption of a new piece of ‘ordinary’ legislation could prove to be far more important.

It bears noting that expropriation legislation is a standard feature in legal systems; there are instances in which all governments will expropriate property. There is also merit to the claim that South Africa’s existing legislation is not compliant with the Constitution. The issue is not whether South Africa should have legislation defining this power, nor whether a new Act is needed, nor even whether in particular instances expropriation might be used for purposes of land reform. Rather it is whether the provisions in this Bill satisfactorily protect the interests of South Africa’s people, and what its wider implications for policy might be.

The Institute of Race Relations has spoken out against this Bill.

Key concerns

One the key concerns is the manner in which expropriation is defined. In the Bill it ‘means the compulsory acquisition of property by an expropriating authority or an organ of state upon request to an expropriating authority, and ‘‘expropriate’’ has a corresponding meaning.’

The Institute argues that this definition tries to translate into general law a 2013 Constitutional Court ruling which stated (it was careful to state that this applied specifically to the facts of the case) that the taking of property by the state as ‘custodian’ on behalf of South Africa’s people does not qualify as expropriation and so does not merit the payment of any compensation. This would set the scene for the mass ‘custodial’ taking of all land in the country, and has been demanded by the Economic Freedom Fighters and by many within the African National Congress.

  New land expropriation laws are worrying

The Bill further sets out a number of circumstances under which ‘nil’ compensation would be payable. (Think of this as the most direct expression of EWC.) Five such circumstances are enumerated, though the list is not limited to these, potentially opening up opportunities for the state to take private property in other instances too.

Equally important is the process the Bill sets out for compensation.

The state is to identify the land it wants, and then to negotiate with the owner for its acquisition. If this is not successful – perhaps if the owner declines the compensation on offer – the state will issue a notice of intention to expropriate. It should invite representations, but while these must be considered, they need not be given a response.

Notice of expropriation

The next step would be to issue a notice of expropriation. This specifies the dates on which possession and the right to own will pass to the state. This could take place within weeks or even days. The only limit here is that the date ‘must not be earlier than the date of service’ of the notice.

While this can be opposed in court, it would be expensive to do so, and might have to be done only after the property has already passed into the state’s ownership. Where the property is an income-producing asset (think a farm or rental property), this will mean loss of that income too. The incentive would probably be to take what is on offer.

I’ve previously argued that what is sometimes obscured by the idea of EWC is not that no compensation at all may be paid, but that what is offered is nominal or inadequate. In late 2020, I put it thus: ‘It is not only the quantum of compensation that is at issue, but the latitude afforded the state to take property from those subject to it. It is, in other words, about weakening property rights in general.’

More recently, we have drawn attention to the manner in which this Bill interacts with other proposed legislation and associated developments. These include – my column last week dealt with this in some detail – the Land Court Bill, the Unlawful Entering on Premises Bill, and the recent case around the eviction of Bulelani Qolani. It is by no means clear that the Expropriation Bill (in its justification of ‘nil’ compensation where the owner does not exercise ‘control’ over a holding) will not serve as a handy means to legitimate land occupations that the state might find politically inconvenient to act against. The state already often seems to find itself  impotent to counter land invasions.

Take into account also the political context: a stressed society, a corrupt governmental system, and a ruling party that has run out of imagination. Cumulatively, these impulses could be profound. The Director of the Centre for Development and Enterprise, Ann Bernstein, made the following comment in an exchange with the Institute, in which she argued that the Bill did not represent the danger that we claimed: ‘There exists a real risk that despite the bill not making the vast changes to the existing legal provisions that some claim, its passage will inaugurate a period of far more aggressive, more frequent use of expropriation by the 250-plus state entities that already had these powers under the old legislation.’

This is a concern that we share – although as I’ve pointed out, contending that some of the changes would be weighty ones. 

Watch the coming week carefully. Its impact could echo for some time to come.

Terence Corrigan
Terence Corrigan is the Project Manager at the Institute, where he specialises in work on property rights, as well as land and mining policy. A native of KwaZulu-Natal, he is a graduate of the University of KwaZulu-Natal (Pietermaritzburg). He has held various positions at the IRR, South African Institute of International Affairs, SBP (formerly the Small Business Project) and the Gauteng Legislature – as well as having taught English in Taiwan. He is a regular commentator in the South African media and his interests include African governance, land and agrarian issues, political culture and political thought, corporate governance, enterprise and business policy.

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