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LREAD Perspective July 2018

LREAD Perspective July 2018

Parliament is currently wrapping up public participation sessions throughout the country, which allowed ordinary South African citizens the opportunity to speak out on the proposal to amend Section 25 of the South African Constitution in order to allow for the expropriation of land without compensation.

Some of these sessions have laid bare the raw emotion often accompanying discussions about land in our country. On the one hand, people are arguing that through colonialism and apartheid policies, black South African citizens’ land was stolen and needs to be returned. Their argument is that no compensation should be payable on something that was illegally taken. On the other hand, commercial farmers and agricultural businesses are arguing that they bought their land with legal money and mortgages, which are being paid back with commitment and hard work. They stole nothing.

Many commentators have had much to say on this topic lately, but two articles, from different perspectives, have recently stood out from the crowd for me:

  1. Joel Netshitenzhe, ANC MEC member, in his excellent article: “Separate the wheat from the chaff on land debate” in the 15th of July edition of City Press.
  2. Nick Serfontein, commercial farmer and chairman of the Sernick Group, in his passionate open letter to President Ramaphosa on what is needed for successful transformation in our agricultural sector, published on News24 on the 26th of July.

Netshitenzhe gives a clear and sober overview of the current process and issues on land reform. He emphasises that the public hearings and written submissions to Parliament on expropriation will be dealt with on its substance and not as a referendum style numbers game. He also makes the point that expropriation without compensation can already happen and it is not needed to change the Constitution to affect it. Netshitenzhe ends his article with a reminder that the Constitution directs us on general principles, but a law of general application regarding expropriation will have to be developed in order to proceed with this process.

Nick Serfontein is a farmer from the Free State who developed a sophisticated and profitable value chain in the beef industry. Serfontein farms on 5500 hectares; employs 550 people in a business, which includes a Bonsmara cattle stud, a feedlot, feed mill, abattoir, meat processing plant and retail butcheries.

Serfontein may speak on land reform and transformation, as he is putting his money where his mouth is. Sernick is currently partnering with Land Bank and the Jobs Fund with a R250 million commitment, to have a total of R500 million which will be used to train 660 new black farmers as well as establish 50 new black commercial farmers over a three-year period. These beneficiaries will be integrated in the Sernick value chain in order to increase their profitability and chances of success.

According to Serfontein, what is needed for successful land and agricultural transformation is the following:

  • A selection process for potential farmers based on ability and aptitude.
  • Black farmers need title deeds to secure access to finance.
  • Redirect the Agri Park budget to support emerging farmers and to re-capitalise their farms.
  • Re-think the role, function and composition of District Land Committees, as it is currently not delivering outcomes.
  • Establish a professional development agency to undertake the redevelopment of farms and selection of beneficiaries. This agency should facilitate recapitalisation and funding applications for new farmers from institutions such as the Land Bank. It could also provide extension services in partnership with mentors and assist with market access.
  • Keep the above functions away from government departments. They have to focus on policy, legislation and to provide an enabling environment for agriculture to prosper.
  • Involve commercial farmers with providing support. Many are willing to do so free of charge.
  • Government (or its agency as alluded to above) must assist to form partnerships to develop unproductive land. The concept of a partnership where funding is provided by government (30%), Land Bank (30%) and commercial farmers/agri businesses (40%) are excellent, but new structures are needed to make it work.
  • Keep politics away from developing farms and emerging farmers.

Both Joel Netshitenzhe and Nick Serfontein make very useful and practical observations and suggestions without being distracted by the noise currently generated by especially politicians who see the land issue as their ticket to the 2019 general elections.

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