Ann Bernstein

Ann Bernstein

Food prices are rising fast. The future of land reform will affect the country's ability to reach its economic growth targets, produce its own food and compete in global agricultural markets.

It is, therefore, really worrying that land reform is heading for trouble. The director-general of Land Affairs, Tozi Gwanya, recently said that at least half of government's land reform projects have not made the people newly settled on the land better off.

White-black redistribution is taking place far too slowly to meet the government's target that 30 percent of commercial agricultural land be black-owned by 2014.

Plans to improve tenure for black people in rural areas have made little, if any, progress. The restitution process has successfully settled almost all claims in the cities.

The remaining 5000 claims are typically large rural claims. These are difficult and expensive and progress has been extremely slow. Only four percent of claims on the rich sugar lands of KwaZulu-Natal had been settled by late last year.

The government has said that its 2008 deadline for settling all land restitution claims will not be met.

A bizarre development is that some black emerging farmers now find their new land under claim as the restitution proceeds in isolation from Black Economic Empowerment (BEE) and redistribution policies

Meanwhile private companies and markets have made major contributions to land reform.

Centre for Development and Enterprise (CDE) research shows that:

lMarket transactions have already transferred land equivalent to 40 percent of the land transferred through government's land reform programmes.

lThe quality of land transferred through private market processes is higher.

lPerceptions that "the market" or "white farmers" have been manipulating prices upwards or resisting land reform are wrong.

Land prices have not been rising much faster than inflation and, in many areas, there are many "willing sellers" who are also willing to assist new black farmers settle into farming.

lIn three major agri-business sectors (sugar, timber and fruit) the private sector has been actively engaged in promoting and supporting land reform for at least a decade.

lThe large private sector banks are now a leading source of finance for BEE in farming and agri-processing. In 2004 the private sector funded more than twice as many land transactions as the state.

lThere are a growing number of BEE deals by land-based companies, such as Sappi's major deal with the Lereko Property Consortium.

Deals like this extend black ownership not only over land, but also into more profitable parts of the agri-processing value chain.

lThe results of private sector-led land reform are usually better than state programmes in terms of productivity and sustainability.

This is because of the private sector's emphasis on effective BEE and its ability to give technical support to new farmers.

The positive role of markets and private sector in land reform can and should be expanded in partnership with the government.

So CDE is calling on the government, ANC and private sector to establish a talented, action-oriented partnership that will report to parliament every six months.

This partnership should consist of senior leaders in government, the ruling party and the private sector. Its work would focus on five tasks:

lCompleting restitution quickly and well: We need a public-private task team to resolve remaining restitution claims urgently.

This should include buying land efficiently and providing options, including cash settlements and agricultural college bursaries.

lGetting redistribution right: More land will be needed for black settlement and ownership in rural and urban South Africa.

It's essential that redistribution meets these needs in ways that leave land reform beneficiaries and the country permanently better off.

lDe-racialise commercial agriculture: We need many more commercially viable private sector land reform initiatives like the sugar industry's Inkezo Land Company.

Inkezo has had a lot of success in redistributing land and supporting emerging farmers. Unfortunately it's now severely hampered by land claims.

Other farming sectors should establish similar organisations provided government can guarantee environments where they can realistically operate.

lTackle rural poverty directly: Instead of using land as the only way of addressing rural poverty, we need to think more creatively.

Two practical suggestions. The government should allocate R1 billion a year for five to 10 years to a rural education fund to provide education for young rural people.

Many of South Africa's greatest achievements have been the result of public-private partnerships. We need this kind of partnership for land reform now.

lAnn Bernstein is executive director of CDE. This article is based on a new CDE report, Land Reform in South Africa: Getting back on track, co-authored with Dr Jeff McCarthy.