Farms handed to land claimants keep collapsing as SA’s food crisis deepens. What are you doing to ensure they stay productive?
We’ve learned our lessons. After doing a review of all our projects, we’ve created a post-settlement support framework for all land reform farms through our Land and Agrarian Reform Programme (Larp). In the past we failed to put together a package to create effective support. We’ve learned that we must work closely with the agriculture department and other entities like water affairs and forestry, and municipalities. We want to create customised support packages throughout the value chain. We have a handle on this now. The only outstanding questions are getting sufficient capacity, which we don’t have in provincial agriculture departments, and dealing with community conflict, which has been the cause of many farms collapsing.
How do you plan to address capacity?
We can no longer do land reform as though responding to a static need. We must confront the realities of rising input costs, especially energy, and how these affect production processes. You can’t have a project manager with oogklappe. Agriculture is part of the global commodity market, subject to price volatility. Established farmers can hedge against this through risk management strategies, by owning the value chain. We need project managers who understand agricultural economics – especially how the value chain works – not just policy or legislation. Larp recognises recruiting appropriate skills for these areas. It’s about marshalling technical expertise on the ground. When we don’t have it we will recruit from outside, and form partnerships, particularly with experienced farmers.
And community conflict?
We’re setting up a mediation facility as an urgent priority, using NGOs who specialise in community corporate governance. We will appoint caretaker management companies to run farms, while conflicts will be addressed so production is not affected in the interim.
All land claims should have been settled by end March 2008, yet about 5 000 remain. Why did you miss the deadline?
These are very difficult claims. It’s a painstaking process. We have to consider all aspects of what’s in the national public interest. The claim on Moeketsi covers ZZ2, which produces virtually all our tomatoes. If you transfer land you have to be 100% sure the farm won’t collapse in a few months time. The same goes for the Vaalharts irrigation scheme. Agriculture is a major pillar of the local economy.
Land claims are a major disincentivefor investment in agriculture, fuelling spiralling food prices. Can SA afford these delays?
It’s in no one’s interest to delay settlement. I agree that prolonged uncertainty caused by land claims doesn’t promote confidence in the land market and it’s a disincentive for production, entrepreneurship and investment. But we face a catch-22 situation. If we do it too fast, without the capacity to be sustainable, we’re ignoring issues that cause harm and destruction.
Do you concede that administrative blunders play a major role?
Yes. This is part of our historical legacy. When we accepted the targets, we should have asked what organisational capacity was needed to achieve them. The public sector hasn’t mastered matching the job competency profile with job requirements. This mismatch causes much inefficiency. A major constraint is that in land reform we aren’t getting the skills we want. We don’t have the legal skills to draft agreements or the skills to understand valuations. This is not our crisis – it’s a crisis of education. There are many unemployed graduates, but some of them can’t even write a letter. These are bigger questions for our society to grapple with.
What are you doing to fix the problem?
In the short-term we’re stepping up on-the-job training and coaching of staff. We’re also recruiting from the market, even from outside SA, especially scarce skills like planning and agricultural economics.
When can we expect restitution to be wrapped up?
Our minister has given us marching orders. By the end of this financial year we must finalise all claims, except an estimated 2% of very difficult cases that could take a few more years because of jurisdictional disputes with traditional authorities, court action by farmers, or where there are national implications, as with big irrigation schemes, forestry land or conservation land. We’re working hard to finalise the rest, but spending our budget is a problem. We spent R15 billion to settle 74 800 claims since 1995. For the remaining 5 000 we have conservatively estimated it will cost R17 billion for land acquisition alone, excluding grants and transaction costs. That’s more than the whole department or provinces’ [budget]. We can only handle a certain amount of transactions and still achieve risk management compliance. With such a high volume of work, people make mistakes. We just don’t have the financial skills.
Will the new expropriation law be used to speed up claims?
The amendment to the Expropriation Act will make it easier for us to crack some of our cases. Current expropriation law makes it subject to long-winded processes, and compensation paid to landowners could become prohibitive. It also provides for solatium and future losses that could be held up in court for years. The new act should do the trick. It must be tested in court, but we feel it will crack some tough nuts.
Will it became the main instrument of getting land? No. Negotiation is our primary instrument. We want to negotiate the landowners out of their reluctance to sell. Expropriation will always be a last resort.
So the new law isn’t about scaring farmers into selling at below market value?
Our policy is still to pay market value, but we need to review this urgently. If you have a fertile farm next to an informal settlement, the market won’t pay much for it, but an unproductive piece of land in a coastal area might fetch a high price. Land value must be linked to its purpose. If it’s agricultural land, it’s purpose is to produce food, so productive value becomes important.
Are you advocating direct state interference in the land market?
Land is a natural heritage. Once you give it away to other interests and make it inaccessible to SA, it’s lost forever. That would be a big mistake. We need economists to look at this. We need to manage gross distortions in the land market, including foreign investment.
So you would offer R2 million for an unproductive seafront farm that could fetch R50 million on the market?
No. We must use a combination of productivity and market value. Where productive value is low the discrepancy with market value must not be too high. We must infiltrate issues of social justice where the markets fail. But issues of equity, justice and fairness apply to all, including landowners. It’s not fair to pay a price below market value. Land reform objectives include national reconciliation, maintaining confidence in the land market, economic growth, and not dumping white farmers but convincing them they still have a role as SA citizens with a valuable contribution to make in agriculture. Our neighbour [Zimbabwe] is a living example of how not to do land reform. |fw
