A new Expropriation Bill, published on Friday, has made clear the circumstances under which property can be expropriated and, where appropriate, that compensation for expropriation can be zero.
The newly gazetted Expropriation Bill sets out exactly under which scenarios it would be just and equitable for no compensation to be paid when land is expropriated in the public interest. The bill will now enter the parliamentary process before becoming law.
The issue of expropriation without compensation is highly politicised and has been pushed by the ANC and the EFF.
At the same time, the security of property rights has been of major concern to investors, particularly since the ANC resolved to amend the constitution to provide for expropriation without compensation at its national conference in December 2017.
It was at this conference that Cyril Ramaphosa was elected president of the party, taking up the issue himself as a key deliverable to party supporters.
Certainty on land rights is especially critical at this time as the country strives to rebuild the battered economy. The government’s economic recovery plan, which is due to be announced by Ramaphosa in parliament on Thursday, sets this out as an important priority.
The scenarios in which land can be expropriated without compensation include, but are not limited to, the following:
- The land is not being used and the owner’s main purpose is not to develop the land or to use it to generate income but to benefit from any appreciation of its market value;
- An organ of state holds land that it is not using for its core functions and is not reasonably likely to require the land for its future activities, and the organ of state acquired the land for no consideration;
- The market value of the land is equivalent to, or less than, the present value of direct state investment or subsidy in the acquisition and beneficial capital improvement of the land; and
- The nature or condition of the property poses a health, safety or physical risk to people or other property.
The bill provides that the amount of compensation to be paid to an owner or landholder must be just and equitable and must reflect an equitable balance between the public interest and the interests of the expropriated owner or landholder.
Regard has to be taken of all relevant circumstances including the current use of the property, the history of the acquisition and use of the property, the market value of the property, the extent of direct state investment and subsidy in the acquisition and beneficial capital improvement of the property, and the purpose of the expropriation.
On Sunday, public works & infrastructure minister Patricia de Lille, delivering a statement on behalf of the interministerial committee on land reform, said the bill brought certainty to South Africans and investors because it clearly outlined how expropriation could be done and on what basis. "This legislative certainty is critical as we rebuild our economy and invest in our communities," she said.
The bill outlined circumstances when it may be just and equitable for no compensation to be paid.
"It does not prescribe that nil compensation will be paid in these circumstances. The bill provides that the amount of compensation will be determined by the courts," she said.
De Lille said the bill was gazetted and submitted to parliament on Friday after it was certified as being constitutional by the chief state law adviser.
The fact that it was deemed constitutional to allow for expropriation without compensation within the current framework of the bill of rights is significant as it has been almost two years since the National Assembly agreed that the constitution should be amended to explicitly allow for land expropriation without compensation.
De Lille said the bill has been drafted to be consistent with section 25 of the constitution as it currently stands.
The process to amend section 25 of the constitution, which runs parallel to the process regarding the Expropriation Bill, is still not complete.
Asked whether it is still necessary to amend the constitution since the legislation was deemed constitutional, Thoko Didiza, the minister of agriculture, land reform & rural development, said it remained relevant because clarity on this matter was still needed.
De Lille quoted deputy president David Mabuza, who chaired the interministerial committee, as saying that the publication of the bill was a "cogent indication that government is indeed at work to realise redress and fulfil the aspirations of the people to have an equitable society".
Mabuza said that it was a recognition of the urgency required to tackle the injustices of the past and restore land rights in a responsible manner, while ensuring that food security is maintained, that equitable spatial justice is achieved and that continuation of investment to expand SA’s industrial base is secured.
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.