Expropriation Bill makes it quick and cheap for state to seize property

The revised Expropriation Bill of 2015 has been released and poses a major threat to private property rights.

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It is “just as unconstitutional as its 2008 and 2013 predecessors”, according to Dr Anthea Jeffery, head of policy research at the Institute for Race Relations.

In its revised format the Bill allowed the state to take ownership and possession of property by notice to the owner – and without a prior court order confirming the validity of the expropriation.

Despite its many constitutional flaws, public works minister Thulas Nxesi was aiming to push the Bill through Parliament before the end of the year, added Jeffery.

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The Bill, she said in an article, empowered the state to take property upfront, and left it to those affected to seek redress in the courts thereafter – if they were able to afford this.

As a result, former owners “will be under great pressure to accept the compensation offered by the state, which will generally be less than market value,” said Jeffrey.

The Bill would not only make it possible for the state to “acquire all manner of assets at bargain basement prices and irrespective of the great hardship this may cause”, it would also place banks that held mortgages over property subsequently expropriated at risk, as the compensation payable might not be enough to pay off outstanding loans.

More importantly, seizing of property in this manner was barred by both the common law and the Constitution, said Jeffery.

She referred to the Bill as “a Draconian measure giving all state entities the power to take from farmers, miners, firms, and ordinary people their most important assets”, while offering less-than-adequate compensation in return.

The overall economic ramifications of the Bill were impossible to foresee, said Jeffery – but the threat to property rights implicit in the Bill would deter investment, growth, and job creation.