The practical implementation of land reform openly discussed

April 2015

JENNY MATHEWS, SA Graan/Grain contributor

Mr Japie Grobler, chairperson: Agri-Sector Unity Forum (ASUF) opened this discussion, but he first made a heartfelt appeal to young farmers to get involved as they are the ones who should care about the future.

Japie Grobler

Grobler presented the working document of ASUF, an organisation founded in 2012. Membership is comprised of the African Farmers Association, Transvaal Agricultural Union, Agri SA and National African Farmers Union.

Their main goals are to contribute towards effective policymaking that is in the best interest of all South Africans and advocate consensus positions to stakeholders. Consensus positions have been developed on land reform, rural safety, water, employment and labour and infrastructure. He remarked that arriving at consensus was no small achievement.

Grobler emphasised the need for government, organised agriculture and the agri-value chain to work together to find common solutions for the challenges facing land reform. Fundamental to this is the acceptance that it is in the best interest of all South Africans that land reform succeeds “within the context of maintaining the productive capacity of the land”.

Basic principles of ASUF are:

• The land reform process should be aligned with the National Development Plan (NDP).
• The value of land should be maintained.
• ASUF favours freehold title as a form of land holding for producers.
• A broad community must benefit and contribute toward the process.
• Communal areas should be developed through commercial agriculture.
• South Africa needs a stable economic environment which attracts investment.
• Land reform should occur within the framework of the Constitution.

Since land reform is a national policy, a broad community, which includes government, organised agriculture, the agri-value chain, role-players and the broader public, must all benefit and contribute towards it.

The NDP should be the guideline for the process. It is believed it will enable a rapid transfer of land to preciously disadvantaged individuals without distorting land markets or business confidence.

Some of ASUF’s suggestions are:

• A land audit of private land is the point of departure.
• The NDP’s District Land Committees (DLC’s) have balanced representation.
• A comprehensive, accessible database of land reform models.
• An SPV be established to promote viable models and provide financing.
• DLC’s must be involved in the identification of both land and beneficiaries.
• Beneficiary selection must be broad-based and inclusive beyond political connections.
• They should have training, financial and technical support.
• They should start with a five year lease agreement to prove themselves competent and thereafter be given the option to purchase the farm at its value when they first occupied it.
• Communal areas should be developed commercially.
• There must be a sunset clause so that a co-operating landowner is exempted in the future from land reform processes.
• ASUF considers the re-opening of the restitution process a risk to sustainable production and it could slow land redistribution.
• ASUF contends that land ceilings could be detrimental to food security, but suggests solutions could be found in a monetary approach, e.g. farms with a turnover of R50 million plus will expand only in a BEE partnership. Grobler warned that thus far the focus has been on issues where consensus was found, but suspects more direct confrontations will occur going forward.

Schalk Pienaar

Mr Schalk Pienaar, chairperson of Agbiz, stated that land reform will only be successful if the goal is viable, sustainable and promotes and sustains economic food production.

Furthermore it will only succeed with the right jockeys/beneficiaries and broad stakeholder and value-chain involvement. Beginner farmers must be allocated commercially viable, sustainable units and be given security of tenure from the start to stand a chance of success. Meaningful contributions from financiers, extension services and experts are essential. He added it is important to view this as a long-term process which must operate on free market principles. Pienaar also said that land reform can not only be current landowners’ problem alone.

Ralph Swart

Mr Ralph Swart, a new era commercial farmer from Elim, highlighted the problems new era farmers face:

• Landownership – land is expensive and the Land Bank does not support emerging farmers as it should.
• Rented lands – there is no security and no guarantee and that creates problems in accessing financing. Demand is furthermore high, which means there is no certainty that land will be available again.
• Quality of soils – good lands seldom come into the market. A huge problem is that the state buys up the poorest of the poor soils at sky high prices for absolute sub-standard land. When these farms are handed to a beneficiary they are already set up to fail. Swart suggests that local farmers should be consulted on the usefulness of such farming land before the state buys them up.
• The beneficiaries – the farms are not being given the right jockeys.
• Recapitalisation – this cannot only be done over one year. Rather it should be rolled out over a five year period to ensure sustainability and even then there should still be support systems like lower interest rates.
• About land reform he remarks: “Hierdie trein wat ons opgeklim het vir hulp, se wiele is pap.”

Andrew Makenete

Mr Andrew Makenete, director of Manama Hole and Musa Capital, urged a balanced view of land reform.

20 years on and no blood has been spilt and millions have been spent on restitution, redistribution and reform, but he maintains that land reform has not delivered land to black producers, the money has not been spent well and disillusionment has set in.

If we continue to do more of the same we will waste more millions. There is no proper strategic framework guiding land reform capturing both the NDP and the mood of the citizens. Current proposals by government are not viable or scientific.

He contends that land value destruction post acquisition is severe and a new approach is needed. Makenete proposed ownership of land be transferred from Rural Development and title given to the Land Bank which will issue long-term leases to farmers so that land can become an asset for the producers and give them an opportunity to move forward.

Publication: April 2015

Section: Special feedback