Forestry in South Africa
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November : Important land matters and Agricultural Development Agency update

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26 November, 2019

Important land matters and Agricultural Development Agency update

Important land matters and Agricultural Development Agency update


Following the Agri SA Centre of Excellence on Land meeting on Monday 18th November, we would like to report on the following important matters:

Amendment of the Constitution for Expropriation without compensation

  • As we have previously reported, the ad-hoc Parliamentary committee on EWC, never completed the task of recommending proposed wording to amend the Constitution. They are busy with that process now and they invited experts to address them on 6-7 November. It was once again a flawed process, as the meeting was scheduled for 11-12 November and should have included many more experts, including a broad spectrum of experts from academia. The meeting was brought forward on short notice and as a result, there were very limited inputs from experts.
  • The committee invited comments on two proposed wording options, both of which over-reach way beyond what the President and other senior party members have repeatedly said, following the shocking resolution of the ruling party in December 2017.
  • What is very important to note however, is that the proposed options make it clear that any amendment should be in respect of land and not in respect of property rights, which has been a deeply worrying issue throughout the process.
  • Nonetheless, AgriSA re-iterated their position, which is consistent with that of FSA, that they disagree with the committee's findings and with Parliament's resolution based on those findings, that the Constitution requires any amendment. The committee didn't want to entertain any dialogue on this issue, saying that the meeting was only to discuss the proposed wording of the Constitutional amendment but they finally conceded that they were able to report to Parliament that some invitees to the meeting were not prepared to discuss any changes to the Constitution.
  • Prof Elmien Du Plessis with whom FSA has engaged several times previously, also supported the view that there was no need to amend the Constitution.
  • It was agreed that AgriSA was correct not to comment on the wording and that they should also not make any written comments on the proposed wording, as doing so may legitimise the process, whereas our position and that of AgriSA, is that the process is fundamentally flawed, which precludes our participation therein. FSA will maintain this position.
  • The committee are adamant that they will conclude their work by 6 December and that by 15 February, they will Gazette proposed wording to amend the Constitution.
  • It was agreed that if they indeed Gazette proposed wording, even if it is what we expect to be very benign changes, FSA, AgriSA and all other commodity groups must at that time, once again submit our previous written objections to any proposed changes to the Constitution. This will support any future litigation we will initiate should the Constitution be amended in a way that we regard as prejudicial.
  • As we have previously reported to members, bringing about an amendment to the Constitution will require a two thirds majority in favour thereof in Parliament and if the final proposed wording is as benign as we expect it to be, it is unlikely that the EFF will support the amendment, in which case the proposed amendment will fail. Also as we have previously reported, the President himself when he was still Deputy President, defeated the proposed policy to amend the Constitution at the ANC's NEC in June 2017, so if the ANC allows its members to vote with their conscience on this issue, it is also likely that a significant number of ANC MPs will also not support the amendment. Once again this would result in a failure to secure a two-thirds majority.
  • In the worst case scenario, if the two-thirds majority is actually achieved, notwithstanding the severe damage this would do to the EFF in the process, if the wording simply makes explicit what is already possible in the current wording in the Constitution, this would pose no new threat to either property or land rights in South Africa.
  • The committee has planned for another round of public hearings on 17-18 March 2020 once the Gazette has been published. It was agreed that all associations and commodity groups should once again participate in those hearing in addition to making written submissions and our participation should once again be to express our opposition to any changes to the Constitution in this regard.


Expropriation Bill

This Bill, even though it poses no threat to forestry or agriculture in the categories of land it proposes for expropriation, has nonetheless been sent back to Nedlac to revisit the conditions under which expropriation can take place.

Status of Land Claims

  • Advocate Sandile Kobese who works in office of the Chief Land Claims Commissioner (CLCC) gave an excellent presentation to the meeting.
  • He reminded the meeting that of the original 80 000 land claims from the 1998 process, 7000 were still outstanding.
  • After the disaster which was caused through Jacob Zuma's re-opening of the land claims window under the Land Rights Amendment Act of 2014, the Constitutional Court halted the process by declaring that the legislation was invalid.
  • The Concourt nonetheless said that the 163 000 new claims lodged under the invalid legislation, were lodged correctly but interdicted the CLCC from processing them, until the 7000 outstanding claims had been settled.
  • In its second judgement on 19 March 2019 the Concourt dismissed Parliament's application for an extension to finalise the 7000 outstanding claims and declared furthermore that the CLCC must report to the Land Claims Court (LCC) instead of the Minister of DARDLR. 
  • The CLCC must report every 6 months to the LCC on the claims settled and progress in respect of phased claims. Must also report to the LCC on any challenges and constraints (budget etc).
  • The CLCC are also prohibited from declaring on the validity of claims as this is the sole mandate of the LCC.
  • Of great importance, is that FSA asked the advocate whether the CLCC can consider the competing new claims, while settling the old order claims, even if they are not "processing" them per se, so as to avoid settling a claim and finding out in future years, that there were competing claims over that area. The advocate advised that they are both able to do so and do so as a matter of course, during the public comment process, once they Gazette an old order claim. Moreover he advises that they actively alert new order claimants to the Gazette, as many of them may not know the claim has been Gazetted. The importance of this is that through this process, it is theoretically possible to avoid duplication/conflict between old order and new order claims, once the CLCC is able to process the new order claims (assuming the amendment Act is rectified).


New Property Valuations Case

  • Following the partial successes achieved in the Melmoth case, on which we previously reported to members and to which FSA contributed, there is a another case at Jakkalsdal which AgriSA are going to support.
  • In this case, the Minister who is being interdicted, has directed that Professor Moyo, who drafted the spurious regulations, must give evidence as to why the owner should not receive full market value. 
  • If this case also goes in our favour, it will expose the flawed logic by the drafters and may compel the State to finally completely withdraw the regulations.


Approved South African Agricultural Development Agency
(SAADA)

  • The Presidentially-led Public Private Growth Initiative, in which Forestry features prominently and on which we regularly report progress to members, has approved the SAADA.
  • An MoU is currently being concluded with the department of DARDLR for the establishment of SAADA.
  • It is a private sector led initiative but enjoys the support of DARDLR, National Treasury, the DHWS, DTIC and COGTA.
  • A seperate MoU is being drawn up with the banks to provide support and "patriotic capital" to the SAADA. This will involve differential rates from normal commercial loans.
  • The Motsepe Foundation is putting up R100m in capital.
  • The EU Finance Bank have expressed their willingness to invest up to R1bn at a 2% interest rate.
  • The United States' Built Fund for Infrastructure are also willing to commit large funding and again at an interest rate of 2%.  Importantly this would be repayable in Rands which mitigates the risks of currency fluctuations.
  • The SAADA want to encourage companies to invest their CSI spend through the fund which will also provide soft finance.
  • Because more than 75% of SAADA income is for black businesses, all contributors will score 100% for ED, SD and SED/CSI on their BBBEE Scorecard, if they contribute to the fund.
  • They are also looking to use Sec12J structures to augment investment, by paying rebates to contributors.

Source: Forestry South Africa