Land Reform

Land reform solutions reside more in cities than on farms

Ngwathe.jpg

Land reform policies and programmes that exclusively focus on transfers of commercial agricultural land and percentages of farms to farm workers and other beneficiaries are counterproductive.

While the topic of land reform is almost constantly in the news, the executive director of the Free Market Foundation (FMF), Leon Louw, believes the focus should shift to urban areas.

Land reform should rather focus primarily on the seven to ten million municipal council-owned township houses in urban areas, where the vast majority of landless people reside, and not exclusively on the country’s 40 000 commercial farms, Louw argues.

“Property already owned by the state can and should be transferred to the legal residents, thus empowering millions of citizens. Our concern is that by focusing on farmland, government diverts attention from the solution,” Louw is quoted in an article by Inter Press Service.

The organisation proposes that all council-owned properties be upgraded to unambiguous and freely tradable private ownership at minimal or no cost to the lawful residents. This could result in government injecting some R3 billion into the economy.

The Peruvian economist Hernando de Soto explained that the world’s poor are not nearly as poor as imagined because they possess the most valuable capital in every country namely land. But all this land is ‘dead capital’ as these people occupy but do not own it.

“The government could virtually overnight turn this ‘dead capital’ to which black South Africans have been subjected since 1913 into ‘dynamic capital’ through full ownership in the hands of private citizens,” FMF says.

A title deed is seen as a profound game changer for millions of the country’s poorest citizens as it is a tangible asset against which they can borrow money, earn rental income and begin to change their family’s socioeconomic circumstances.

In 2010, the FMF in conjunction with the Ngwathe (Parys) municipality in the Free State province initiated a land reform project that serves to convert land currently held under a complex variety of restrictive tenures and titles to unambiguous, freely tradable ownership.

“In the run-up to the launch of the project, FMF and project partners resolved numerous complex issues ranging from the conversion of property-related debt to civil debt, waiving electrical compliance certificates, and managing mismatched council and deeds registry records,” FMF said in a statement.
“Ngwathe is the first municipality to decide that all black-held council land be held under precisely the same title as full freehold land in historically white areas. The vision is not of black citizens being beneficiaries of land allocation, but of owners having their rights confirmed.”

Twenty four farmers of the Weideveld Boerevereniging, Parys, joined the initiative by agreeing to pay R750 000 to the land reform project that will assist their employees to become homeowners for the first time and see 406 houses converted to freehold.

“Land reform is a highly emotive and increasingly political divisive issue, yet these Free State farmers, without political motive or public fanfare, are quietly helping local black citizens to get access to freehold titles of the homes they currently occupy under apartheid era regulations,” FMF said in a press statement.

“This is a first in South Africa and stands as a prime example of what can be achieved if all parties involved are committed to the principle and ideal of full title for homeowners.”

by Hennie Duvenhage

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