Expropriation Bill - fair or foul?

Private Property South Africa
Jackie Gray-Parker

The way in which government is tackling the land reform issue has garnered criticism from all corners and has raised concerns about property rights going forward.

In a bid to redress the wrongs of the past, government has already passed the Restitution of Land Rights Amendment Act (2014) which extends a window for restitution claims until the 30th of June 2019. Approximately 55 893 claims have already been submitted. The controversial Regulation of Land Holdings Bill and the Preservation and Protection of Agricultural Land Bill are making their way through the channels. Another Bill - the Expropriation Bill - was recently passed by parliament.

In essence, the Bill will enable the state to pay for land at a value determined by a government ‘adjudicator’ and then expropriate it “in the national interest”. Should the Bill come into force, it will effectively scrap the current ‘willing buyer-willing seller’ approach to land reform. Although the Bill still has to be passed by the National Council of Provinces and President Zuma, there’s little doubt that it will be promulgated.

Opposition parties, a number of rights groups and organisations have questioned and spoken out against the Bill. In a recent Property Professional article, Dave Stewart, executive director of the FW De Klerk Foundation which supports and promotes the Constitution and the Bill of Rights, amongst other initiatives said the following prior to the Bill being passed:

“The new Expropriation Bill would extend the power to expropriate property – and this is not limited to land – in “the national interest”, to government and to parastatals at national, provincial and municipal levels.

“In terms of the proposed bill, a municipality might offer you ‘X’ for your home. However, you may be under the impression that the home’s actual value is two or three times more than that. You could challenge the compensation offered in the courts but would have to vacate your property by a date stipulated by the municipality. Then you might be without the full value of your principal asset for years while your case proceeds through the courts. Because litigation is expensive and the outcome uncertain, you would therefore be under considerable pressure to accept the initial below-market value of compensation.”

Commenting on the Bills in general, Stewart added that the state may be trying to establish a principle that if property owners are deprived of their property in circumstances where the state does not assume ownership of the asset – but merely custodianship – there might be no requirement to pay any compensation.

Dr Anthea Jeffery, head of policy research at the Institute of Race Relations says the Bill leaves property owners open to massive losses should the government decide to expropriate their homes, land or other property.

In other reports on the matter, the Banking Association of SA warned that the Bill would expose the property market and property owners to “unquantifiable risk”. According to Phephelaphi Dube, legal officer at the Centre for Constitutional Rights, the definition of ‘public interest’ to justify the seizures in the proposed laws lacked clarity. He added that [it] opens the door to arbitrary expropriation which is based on the essential whims of the Minister.

Deputy Public Works Minister Jeremy Cronin has stated that the Bill has been misinterpreted and that “nobody will be left high and dry by an expropriation.” However, he has also stated that there is nothing in the property clause in the Constitution that says market value has to be paid.

Of course there has also been strong support for the Bill. Eskom has reportedly backed the Bill due to the fact that the power provider has experienced delays in acquiring land for the construction of electricity transmission and distribution lines. Unsurprisingly, members of the Economic Freedom Fighters (EFF) have also come out in support of the Bill, adding that the land should be expropriated without any compensation at all.

Others such as Elmien Du Plessis, an associate professor of law who specialises in expropriation law at North West University argues that criticism of the Bill is unwarranted as it will not give the state more powers than it already has, will not speed up land reform and aligns expropriation with the Constitution.

No doubt the Expropriation Bill and other land reform orientated Bills will continue to cause controversy and spark debate. And rightfully so. The matter of land reform and property rights is not something to be taken lightly and is something that everyone should take an interest in. Suffice to say if promulgated in its current form, the Expropriation Bill will probably be challenged in the courts. It will be interesting to see how things pan out.

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