Tag Archive | expropriation bill

Parliament goes into Easter recess

….editorial….

Now you see it, now you don’t

……    It has now become almost impossible to avoid the use of the time-honoured expression “politics aside” when following legislative developments in Parliament.

The body politic affects most things all the time – from drafting a Bill to a
government media briefing, from debating a departmental investigation to public hearings on new legislation. It all involves the ideology of who is in charge.

In fact, the Oxford Dictionary describes “politics’ as follows: the activities associated with the governance of a country or area, especially the debate between parties having power.

From this one can see how politics will always continue to dominate government policy, legislation, and the parliamentary process, since in the end all permeates down from Cabinet decisions. That’s the way it works. Until of course the moment occurs that corruption, cronyism and state capture dictate the parliamentary process itself.

Then the fine line between policy and politics gets rather tacky. Shady motives such as personal gain or protection from the law become evident. What started out as well-meaning policy can get warped by politics and the passage of legislation becomes erratic, if not unconstitutional.

Coded language

Clearly there are now two Cabinets in South Africa. Also, there are various government departments that tend to follow one faction or another, all reporting to their respective portfolio committees. Of these, some seem to adhere to parliamentary rules on oversight and others seem to be less deep in their probing.

This explains why Jackson Mthembu, Chief ANC Party Whip who conveys ANC messages to the party loyal in Parliament, plays such a critical and pivotal role.

When it becomes ‘a given’ that those in control willfully use the top-down structure to their advantage and become joined at the hip with the party list system, then the decision to follow the orders of the party begin to involve a fear of being unable to pay the school fees or pay the lease on the recently acquired BMW.

It is the party list system that is our constitutional blind spot. It encourages cronyism, defined once again in the Oxford Dictionary as: the appointment of friends and associates to positions of authority, without proper regard to their qualifications.

No change

When this aberration of the democratic process occurs on a regular basis, the expression “politics aside” seems to come back into usage. This time for a different reason.

Understandably, one cannot go through the whole laborious process in every debate and with every turn of inexplicable behaviour explaining the manipulation of facts or non-disclosure of relevant information; the influence that certain business persons have upon policy decisions; or the behaviour of state department heads who seems oblivious of their duties.

Therefore politically-correct shortcuts become necessary in order that one’s own opinion is not involved. It’s a sort of coded language that straight up and down people use as a replacement for the real thing.

So, politics aside, President Zuma is still holding up the Financial Intelligence Centre Bill to combat money laundering. Politics aside, Minister of Mining, Mosebenzi Zwane, is still attempting to get fifty-six changes adopted under the already approved Mineral and Petroleum Resources Amendment Bill and, politics aside, the Expropriation Bill is back with Parliament once again.

The good news

Far more interesting is that, politics aside, the separation of powers is still working to a greater or lesser degree; the legislative process is still being respected by most and irritating some; and the Constitutional Court is still out there as our standard bearer, minus a number of computers.

 

…. and, politics aside, we could be doing so much better.

editorial.... parlyreportsa....27 march 2017

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Restitution of Land Rights Act reversed

Concourt says land bill “improperly” passed

…,sent to clients 25 August….  The Constitutional Court has upheld anconstitutional-court application that amendments to Restitution of Land Rights Act were improperly processed by Parliament.  The Bill was tabled by Land Reform Minister, Gugile Nkwinti.

Groupings opposed to the legislation successfully argued that the amending Bill went through Parliament without sufficient consultation with affected parties.

The proposal made by the Bill was that further claims may be lodged going back to the 1913 Natives Act but the Bill, about to become an Act, had been in any case “put on hold” for 24 months to allow for existing outstanding claims, some 8,000 of them in terms of previous legislation, to processed first.

Existing claimants brought that particular application against the Bill on the basis that those who lodged claims under the new amendment to the Act would be “jumping the queue” and their claims might or were being ignored. The re-opening of the restitution of land process was therefore greeted by a mixed re-action, a fact not expected by the ANC amongst the populace concerned.

More haste less speed

madlangaOnce again the particular habit now regular of the governing party of hammering legislation through Parliament at the last minute before recess has bounced back on the Cabinet and the Presidency.    Justice Mbuyiseli Madlanga said in his finding that the Constitutional Court could find “no cogent reason” for the apparent haste to sign the Bill into law.

He said that there had been a complete lacking in the required public consultative process by all nine provinces as the Bill went through the NCOP process of approval. He described Parliament’s behaviour with regard to the passage of the Bill as “improper”.

How it started

When the Bill was first tabled in a meeting of the National Assembly’s Rural Development and Land Reform Parliamentary Portfolio Committee, Minister Gugile Nkwinti confirmed that the whole process of land restitution for black persons dispossessed of their land was to be re-opened for a period of five years.

Under questioning,he confirmed that no constitutional changes were envisaged, despite the fact that the new Bill would mean an Act that backdated claims to 1913.    Critics of the Bill noted at the time that the tabling of such legislation was, as they put it, “politically motivated” in the light that it was being processed before national elections and with the then forthcoming provincial elections in mind just around the corner. The outcome of those elections would confirm the Minister’s fear and that of the Cabinet.

Critics also stated that there was insufficient time to process the Bill properly. ANC MPs chose to ignore this warning. Thw whole process has therefore been a waste of public funds.

In the kitty

Minister Nkwinti then announced that Cabinet had set aside R47bn for theGugile_Nkwinti envisaged exercise over a period of five years. Opposition members were again alarmed, stating the country had neither the resources nor court time to process such a plan and, in any case, the Department of Rural Development and Land Reform was already facing an uphill struggle to process and finalise the existing claims it had on their books. Opposition members also called for sight of Treasury approval.

During the course of the Minister’s departmental presentation on strategy leading to the budget vote a week later in Parliament, when confronted by opposition MPs asking for a direct answer as to whether he would call for constitutional change on property rights or not, he replied that there was “no such question arising.”

The whole truth

Since that time the tandem Expropriation Bill has also been returned to Parliament unsigned and similarly passed in haste before a recess but, in this case, in the light of a possible adverse opinion by the Constitutional Court.

Minister Nkwinti chose to issue a statement on the the passage of the Expropriation Bill upon its being voted through the National Assembly although not in the domain of his Ministry.

cronin2This statement completely contradicted the declared motivations of Deputy Minister of Public Works, Jeremy Cronin, who had steered that Bill through Parliament declaring his legislation to be necessary for public works to execute infrastructure projects.

Nkwinti’s statement  claimed  that the Expropriation Bill “would bring about the possibility of at last of speeding-up land restitution and reform” thus laying the groundwork of his new land Rights Bill and contradicting the assurances of Cronin.

The numbers game

In his original briefing on the tandem Restitution of Land Rights Bill, Minister Nkwinti stated at the time that since its inception, the state’s restitution programme had benefited some “370,000 households”.    Normally one refers to “claimants” but it was his way of getting to his point using self-serving mathematics.

This meant, he said, that some “1.83m persons had benefited so far from theland-reform process, as against an estimated 3.5m people who had been forcibly removed from their land as a result of colonialisation and racial and discriminatory laws”.

A new closing deadline for lodgement of land claims was set by the Act as mid-2019 and a booklet on how to lodge a claim published.  Mobile lodgement offices were to visit all areas, the department told subsequently told MPs, and the lodgement process required no fees.

Tough words

Whilst the Constitutional Court has now re-affirmed that the right to restitution “could not be overstated” and that “restitution of land rights equals restoration of dignity”, Justice Madlanga was not prepared to overlook the fact that the time line of the parliamentary process had been manipulated.

“As an example, the process of public participation in the Northern areas was reduced to a shambles by haste”, he said, “and as a result of the truncated process of the NCOP, the whole parliamentary procedure had been tainted”. The NCOP was found to have “not applied its mind to the task.”

Give it time

Pending re-enactment of the Act, the Commission on Restitution on Landland-claims-court Rights may continue to receive claims and acknowledge receipt but only process them once existing outstanding claims that had a closing deadline of 1998 are finalised. After 24 months, further consideration can be made on the possible re-enactment of the legislation.

In conclusion, Opposition parties fear that the new Act will allow traditional chiefs with the additional powers granted in terms of legislation favoured by President Zuma to supersede rights on land already granted to communities.

One way only

Disquiet was also expressed by some MPs with the land acquisition claim alternatives as financial compensation was mainly the choice for claimants.

Some MPs expressed the view that they were “uncomfortable” with a monetary solution as a solution to dispossession since this almost amounted to a bribe.

DA MP Thomas Walters said in his view the reason for the slow rate of land occupation was not, as the ANC claimed, the result of whether or not there was a solution on the willing-buyer, willing-seller principle but rather a reflection of the fact that 92% of land claimants preferred to take cash pay-outs instead of working the land and creating jobs.

Minister Nkwinti strongly denied this as did the Department of Rural Development and Land Reform.

Previous articles on category subject
New approach to land reform – ParlyReportSA
Land reform: Something very sad is going on – ParlyReportSA
Minister says need for legislation on land reform a priority
Agri-SA gives views on minimum wage – ParlyReportSA

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Parliament and the investment climate

Seven issues spooking investment…….

editorial……Nothing, absolutely nothing, will stop growth more effectively than to be constantly changing the investment national assemblyclimate by altering the playing field levels; criminalising business for non-compliance of local laws which have nothing to do with business; and bringing about the kind of atmosphere of uncertainty in which investors are constantly attempting to establish current government policy and the reasons for any changes.

Not to understand the reasons is sometimes worse than disagreeing with them. At least if one dislikes an idea one can usually work around the issue. As long as you know its constant its good for investment.

What we know

At parliamentary portfolio committee level, the issue of transformation has been accepted by all as necessary. All are agreed that apartheid was a terrible thing. Most realize that taxes will, without doubt go up, such as carbon tax and probably VAT, as will the cost of living. Most are agreed that service delivery in respect of the ideals of the NDP, especially at local level, is pretty poor.

Also, most agree that just before any kind of election, parliamentarians say some pretty odd things and make totally impractical promises in order to get votes. Look at the USA. However, in rating agency terms of where we stand in South Africa most of these issues have been “discounted”, to use their term.

What we need to know

stone sizaniHowever, in Parliament, cabinet statements, budget vote speeches and government departmental briefings are important to study in terms of trying to establish some measure of understanding as to where government is headed. The aim is always to establish certainty, not give views.

With certainty in the offing, capital investment can be planned for and growth expected. A clearer picture of government policy is always necessary for the greenhouse of ideas in planned expansion and development; whether the plans are worth the risk to exploit and, furthermore, to create an environment where the international message goes out…… this is the place to invest.

What we don’t knowgreen question mark

So what is troubling investors?    Aside from the nonsense going on at the SABC, here’s a few ideas and we are sure there are more….

Seven good reasons for a start:

1. What is the real plan of execution behind the Expropriation Bill? Definitions ranging from “the basis of land reform”; queries on the definition on “the public interest”; and a determination, it appears, not to study the constitutional aspects; all these queries and worries contribute to uncertainty.

2. Imagine what happened to planning departments in the mining industry during the last eight months with Minister Zwane’s surprise contributions to BEE shareholder arrangements and also by stating he was turning charters into law, presumably as part of MPRDA legislation. Uncertainty reigned.

3. It’s not good to hear that the BEE pointing system is to change yet again under the Preferential Procurement Act in major sectors that contribute to growth. One understands that President Zuma warned of this in SONA but how many more changes are to come but how many more times will DTI refine their idealogical BEE process?

4. When are intellectual property uncertainties to end? Where is the new legislation? Planning for the internationals in the pharmaceutical industry can hardly be easy.

5. New climate change fuel specifications are upon us and the Minister of Energy is totally uncertain on this issue, as she is with gas exploration, shale gas, a state refinery and the energy mix generally. Many potential investors have given up the waiting around and have gone, whether the oil price drop was to blame or not.

6. Minimum wage legislation will eventually arrive as far as the human resources environment is concerned but labour law as a whole is in flux with new drafts still with NEDLAC. South Africa is now rated one of the worst countries for an uncertain labour climate.

7. The national health insurance scheme coming from the likes of Minister Aaron Motsoaledi is foggy, unsettling to the financial world and confusing to medical health providers. Issuing White Papers is fine but turning these into legislation requires a finely tuned plan and policy directive. One never knows what the good doctor is to say next.

Cabinet cohesion

A lot of the problems come either from Ministers with little interest in the investment climate and who are probably not up the demands of their portfolio, or who appear to have “hobby horses” of their own. In addition, the friction between National Treasury and the Cabinet, so evident in Parliament, is adding fuel to the fire in terms of financial uncertainty.

A good orchestra always needs a good conductor with the ability of bringing people together accompanied by legislative certainty providing the musical score. South Africa badly needs a leader who can do this.

In parliamentary terms, most will be more relaxed when the current local elections are over; Parliament can restart and pressure then applied again to get clarity on exactly what investors can and should expect.

Previous articles on category subject
Parliament, ConCourt and Business – ParlyReportSA
Minister Brown wants utility shareholder management – ParlyReportSA
Editorial: Working committees – ParlyReportSA

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Expropriation Bill tops parliamentary agenda

Expropriation Bill to be voted on ….

Sent to clients 4 January….The Expropriation Bill is now carried over into this year’s first parliamentary termcronin2 because of the earlier strike of parliamentary workers, still not fully resolved. The Bill originally provided for the “expropriation of property for a public purpose or in the public interest, subject to just and equitable compensation.”

What defines “a public purpose”, “property” and “the public interest” have been the subject of five weeks of hearings and debate in the Portfolio Committee of Public Works. Reference to the Constitution has been constantly made.

The Bill, considerably refined in some aspects, is expected to be passed quite early in the new parliamentary year as part of a personal determined drive by Deputy Minister of Public Works, Jeremy Cronin.

Behind the Bill

Minister Cronin has attended each and every portfolio committee debate, all the hearings and responded for the most part to Opposition questioning and the rejection, to varying degrees, to changes of some of the proposals contained in the Bill and accommodating others.

The State Law Advisor and various parliamentary legal advisors have been attending all meetings since their advice was constantly being sought during discussions in the clause-by-clause debates.

A major issue to be debated was whether this Bill could be “trumped” by BEE legislation, a trumping proposal for BEE legislation to trump other legislation having being proposed in different forums. It appears that this is now the case.

The Bill has achieved a “B” version – in other words there being so many amendments that the entire Bill has had to be re-printed and tabled, this now being the version parliamentarians are working from.

Luthuli House query

The fact that the expression “subject to just and equitable compensation” was removed by the ANC from the long title of the “B” version of the Bill has led many Opposition members to suspect the motives of the ANC in supporting many of the amendments made during the closing passage of the Bill. This issue will probably be the first to be debated when Parliament re-opens.

Until now, Deputy Minister Cronin has been going to extreme measures to explain that the main purpose of the Bill is to assist Eskom in its drive to equip the utility with the tools to enable it to connect more grid lines to under supplied industrial areas. However, the recent change has re-established a lack of trust by opposition members, particularly those representing the farming lobby, that this is really the policy behind the Bill.

Previous articles on category subject
Expropriation Bill grinds on – ParlyReportSA
Expropriation Bill phrases could be re-drafted – ParlyReportSA
Zuma goes for traditional support with expropriation – ParlyReportSA

Posted in Land,Agriculture, LinkedIn, public works, Special Recent Posts, Trade & Industry0 Comments

Special cabinet statement might correct damage to SA

Editorial…..

At last, a sensible special cabinet statement……

Sent to clients 15 Jan…On 13 January, a Special Cabinet Statement was issued and, as compared to previous irregular missives, the word “special” indicated some hope.   Instead of just containing the usual reasons for having to rejoice on certain public holidays, details of the passing of MK operatives and certain Bills approved, the latest document was full of economic facts and financial fiscal information placing a positive spin on the current economic gloom. At last, an acknowledgement that there is a hand on the tiller.

Clearly there has been a palace revolution, if only in this sphere alone.

As the Cabinet Lekgotla is planned, Parliament also prepares to receive it’s parliamentarians all fresh from the respective political party get-to-gethers. A lot has changed since they all parted company and quite likely a lot more is to change before MPs gather for their first meetings.

No doubt the EFF will try to make a circus out of things but nevertheless the show will go on.    However, EFF or not, it is becoming more and more difficult to sort out between political comment, which is not our focus, and the mechanics of State policy and its direction, oversight on financial issues and legislative alerts that affect business and industry.

Bad four days

Rob-DaviesRed lights are flashing in all camps, not least of which is the fact that it is difficult to tell who did the most damage to South African markets – China or President Zuma. In parliamentary terms, the Portfolio Committee on Trade and Industry seems determined to stand by SACP Minister of Trade Industry, Dr Rob Davies, in all matters dealing with BEE and trade agreements- as does DTI itself – and the Public Works Portfolio Committee seems unable to wear down SACP Minister, Jeremy Cronin, on issues regarding the Expropriation Bill.

Similarly, Lumka Yengeni’s Portfolio Committee on Labour Committee has no hope of a good outcome when it ordered, in the last session, an end to the shambles and confusion in Minister Mildred Oliphant’s Department of Labour, another Kwa-Zulu appointee of President Jacob Zuma.

Always a problem

Finally, despite some excellent MPs from all parties sitting in the Portfolio Committee on Energy, the vague report backs made to them by Department of Energy is leading to a sense of frustration in that particular Portfolio Committee which is not effective either as a result. In the area of good communications, Minister of Energy, Tina Joemat-Pettersson can only be described as a menace.

The good news is that stalwart ANC Joanmariae Fubbs remains Chairperson of the Trade and Industry Portfolio Committee  and holds the ship steady with her disciplines. SACP executive Yunus Carrim stays as Chairperson of the Standing Committee on Finance and one wonders if he will see eye to eye in view of his ideologies with Minister Pravin Gordhan.

Overlooked as well

A Jacob Zuma appointee, Ebrahim Patel of COSATU fame but a hard worker and very leftist, remains Minister ofebrahim patel Economic Affairs but even he was overlooked for Minister of Finance when the President came up with name of David van Rooyen, who, to be quite frank, we had great difficulty in recalling his presence in Parliament over the last few months. A close shave but costly.

Back onto legislation. Whatever happened to the Private Security Industry Bill nobody knows but one hopes that the President was not using it to play silly games with the Obama administration on the AGOA issue. Maybe it gets discussed at the Lekgotla. Maybe not.

Politics ahead of economics 

In the meanwhile, one hopes that the message is got through at the Cabinet Lekgotla that what the President says vitally affects each one of his citizens and that that the private and personal politics being played out at the moment are particularly damaging to the business of Parliament and its relationship with commerce and industry.

Just as importantly, there has to be a better understanding in government departments when reporting to Parliament why business institutions need clarity of policy to gain investment confidence.

opening parliamentParliament is an important and independent tool of democracy in the fight against autocracy but so many departments seem more in awe of the auditor general than they are of the need for answers to parliamentary questioning and attempts to get the truth.

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Expropriation Bill grinds on

Expropriation: “public interest” and “property”

3- day précis…sent to clients 2 Nov….. Parties are coming closer during debate in the Portfolio cronin3Committee on Public Works to a slightly watered down Expropriation Bill, with Deputy Minister of Public Works, Jeremy Cronin, leading for the Minister who tabled the Bill before Parliament.

The name of the Bill has not resonated well amongst the international business community in the light of other events in Southern Africa.

Nevertheless, Minister Cronin has stated that eventually such a Bill will succeed, despite the concerns of many parties and that the proposed Bill has no malevolent purpose other than assisting “in the public interest”.

The public interest?

Therein lies the problem in that it remains a state responsibility to decide what the public’s interest is and which “public” is the subject matter of any decision for invoking the legislation.   As is the case with so much legislation at the moment, it is therefore a question of the wording of the Minister’s powers and the definitions of the tools at his or her disposal which is of debate.

Most of the debate earlier had centered around the definition of “property to be expropriated” in the light of the fact that the Bill cannot exceed the powers of the Constitution, wherein the word “property” is also not expanded upon – a number of court precedents arising previously where no final determination was made on the subject.

Calling in the Constitution

At one stage, the Deputy Minister proposed that “property” could be defined as “contemplated in section 25 of the Constitution”, the Deputy Minister considering this a major concession by the Department.  However, Opposition members still claimed that the word “property” could not be used in any piece of legislation without a definition of the term “property” also being listed and also in the knowledge that such terminology could not be contextualized even in terms of the Constitution.

On what could be expropriated, the Deputy Minister presented another alternative wording stating the that “the Minister’s power to expropriate property applies to property which is connected to the provision and management of the accommodation, land and infrastructure needs of an organ of state, in terms of his or her mandate”.

This was not found to be satisfactory either by the Committee since the term “that does not fall within his mandate” was vague and could be determined in any number of ways and open to any kind of interpretation.

The Deputy Minister was advised by senior counsel the way the Constitutional Court defined property land seizureremained “ a moving target”, especially section 25, and also in the Bill of Rights and this matter needed to be looked at again.

New draft for discussion

The Deputy Minister is to return to the next meeting with a further proposal on the definition of property issue which would possibly be part of a “B” version of the Bill, then to be reconsidered in totality by the committee. Such will be ready in a few days.

Another alteration of major importance so far is that a new wording using the expression “disputing party” has used in some cases instead of “claimant”. This is now used to describe “claimants” where they no longer are such in the process of expropriation, particularly in not accepting the amount of compensation offered. This is important, as thus the Bill and the parties will accept that indeed a dispute has occurred.

Two months in debate

At this stage the Bill has had three full days of “clause by clause” debate with more to come, draft clauses flying backwards and forwards, the final to be proposed by the Minister as agreed to and under the guidance of the State Law Advisor representing the State’s last offer of compromise and agreement to change wording and those changes as so far agreed to by the Committee.

Minister Cronin still maintains infrastructure projects are being held up, having to be changed or stopped. He had earlier called upon Eskom to give evidence of this.

There is general agreement that Deputy Minister Jeremy Cronin has bent over backwards with subsequent alterations to meet demands but there still exists amongst Opposition a feeling that ulterior motives exist for the legislation and the legislation is not simply “to assist Eskom buy land for electricity development”, as Minister Cronin first declared.  In the background is the threat of a constitutional challenge but this has dissipated somewhat.

The “E” word

pylonsMuch of the debate has also centered around the issues of “municipal planning” and “powers of municipal mangers” giving credence to Minister Cronin’s views. He has said the word “expropriation” is a loaded expression at this time in Africa’s history and has an unfortunate influence on the necessity for the Bill to proceed.

There is also change, seen by Opposition members as an improvement, which deals with the mediation process which previously allowed the expropriating authority to use the absence of a timeous response to bypass the process of mediation. This is not now the case, the issue of mediation being allowed to proceed under any circumstances should this be required.

Progress

More debate is to follow in subsequent days but a final document will no doubt be voted on by the committee shortly before going to the National Assembly, probably in this session of Parliament. In a meeting subsequently, a “B” version of the Bill was introduced and Chapter 4 on Intentions to Expropriate and Expropriation of Property was completed to the satisfaction of most, leaving the impression that much of the steam about the Bill in general had been reduced.

The issue of the definition of “property”, however, still remains a contentious issue simply because of legal determinations.  On 21 October, to expropriate where there was a mortgage bond was debated at length and satisfaction reached and that notice to the expropriated party and any farm workers or dwellers must be simultaneous before the issue of “just and equitable compensation” is considered.

More serious issues

On 27 October the major issue of debate involved the term of “just and equitable” compensation in the Constitution and how this would be applied to the expropriation process in the Bill.

Also debated was the question of a large community being expropriated and whether water availability, dwelling provision and the needs of a community restored. The Minister explained that the Expropriation Bill per se was about expropriation and the process and not about land reform and for this process there was plenty of legislation already to hand and new legislation planned.

The following week of November, however, should see this matter resolved mid-month providing hecronin current NEHAWU strike action of disturbing meetings does not continue, but whether all will be to the satisfaction of each party has become somewhat academic, it becoming more and more evident that Deputy Minister Cronin, who has handled each stage of the process personally, seems determined, in his patient and determined way, to see this Bill through with the property clause undefined.

Last minute attack

The EFF attempted to delete the whole of chapter 5 on compensation in the Bill as they maintained that the subject matter was expropriation, not compensation at all but such a suggestion was put aside by the chairperson Ben Martins as a political ploy rather than a serious contribution.

Other articles in this category or as background
Expropriation Bill phrases could be re-drafted – ParlyReportSA
Expropriation Bill has now to be faced – ParlyReportSA
Zuma goes for traditional support with expropriation – ParlyReportSA
Expropriation of land stays constitutional – ParlyReportSA
Amended Expropriation Bill returns – ParlyReportSA

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Expropriation Bill phrases could be re-drafted

Most countries have forms of expropriation…..

As a result of three full days of public hearings on the new Expropriation Bill,  Deputy Minister of croninPublic Works, Jeremy Cronin, confirmed that in a number of aspects, notably on issues of arbitration and definitions of “the public interest”, the Bill as tabled needed re-drafting considering certain constitutional aspects.

He was adamant that a Bill of this nature was needed, a fact not disputed by many in submissions, but the wording of the Bill at present certainly seems to have raised the spectre of a constitutional challenge if the hearings were anything to go by unless considerable alterations take place.

Expropriation definition will trump all

Whether the Expropriation Bill is land reform in disguise or a genuine attempt by the Ministry of Public Works to unlock mechanisms that are preventing infrastructure development became the kernel of discussion and debate. This was after some twenty five submissions by various parties across the entire business, political analyst and land ownership spectrum.

Clearly opinion is still divided but the motives for dissension and the subject of the submissions put to the Portfolio Committee on Public Works were as varied as the arguments put forward by the department itself in the need for such a Bill.

Eskom used as reason

The worry behind any disagreements with the wording of the new Bill appeared in question time. Would the Department of Public Works (DAPW) seriously put forward an ANC Alliance proposal for “land grabbing” under the simple guise of a platform of argument such as that Eskom needed to resolve land issues to extend electricity grid installations or that the N2 was held up in the Eastern Cape?

Anything else in the “public interest” including “property”, as yet undefined, would be unconstitutional, said many of the submissions, whether agreeing to the basic need to alter the anchor Act by amendment or not because the ‘willing buyer, willing seller” principle was clearly “out of the window”.

How close is Constitution on “expropriation”

Minister Cronin The Bill tabled clearly states that it “seeks to align the Expropriation Act, 1975, with the Constitution and to provide a common framework to guide the processes and procedures for expropriation of property by organs of state.”    This, the Bill says, would be in the “public interest” but again and again the query arose as to what the “public interest” might be.

Throughout the entire round of submissions, the Deputy Minister of Public Works, Jeremy Cronin, was at pains to express the benign in nature of the proposed Bill insofar as plans to expropriate land. The intention of the Bill was merely to speed up processes that hindered development in the “public interest”, he argued.

He admitted that in some cases this might include “land development” but denied that the Bill was in fact a pre-cursor to the proposed Land Reform Bill and the recently tabled Promotion and Protection of Investment Bill, where the issue of land in the one case and “property” in the other case arose.

CCCI attacks whole raft of Bills

ccci logoSuspicions in respect of this were strongly expressed by Ms Janine Myburgh of the Cape Chamber of Commerce (CCCI) who claimed to represent also the views of SA Chamber of Commerce, in completely rejecting the Bill as a flagrant attempt to undermine the Constitution.   She thus brought CCCI to a great degree into contradiction with Business Unity SA (BUSA) and even Agric-SA, both of whom agreed that such a Bill was in order but that the wording need much attention on the issues under debate.

In some respects the CCCI presentation, as lodged with Parliament and subsequently circulated, differed in basic content from the speech actually made, which was particularly vehement in its rejection of the Bill and which, Ms Myburgh said, flew in the face of the Constitution. She linked the Expropriation Bill with the Promotion and Protection of Investment and other land reform legislation from the Minister of Rural and Land Development together.

Coming round the corners is more…

CCCI was convinced that the Expropriation Bill was the first of more legislation to come that could damage any investment in the South African economy; was an attempt to provide precedent for expropriation at “any price”; and should be the subject of a constitutional challenge. The need for the Bill in totality was rejected.

The chairperson, Ben Martins, complained that the CCCI submission brought “nothing to the party” with no alternative suggestions, “nor an attempt to understand the processes involved”. They should only discuss the Bill before them. The UDM stated that they doubted whether Ms Myburgh, an attorney, “had even read the Bill” and Minister Cronin, said that the input by CCCI was an embarrassment and a waste of the committee’s time. There would be a Bill tabled eventually, that was a fact that seemed to be accepted, but to contribute nothing was a pointless exercise, he said.

He expressed his view that Ms Myburgh should not even be allowed to respond to these different criticisms since her organisation either had not read or did not understand the Bill. He asked how the Bill could be “unconstitutional” when it directly enforced the “public interest”. What was being discussed, he said, was to define this with wordings necessary to resolve issues, achieve this, and move forward.

Minister Cronin said that CCCI had adopted an alarmist attitude, which he was continually at pains to oppose, and added that a wide majority of stakeholders who had intervened in the public hearing thus far, including Business Unity South Africa (BUSA), Agriculture South Africa (Agri-SA) and the Banking Association South Africa (BASA) amongst others, had raised useful contributions which had to be considered.

Minister Cronin said that he hoped that the media present would have the intelligence to understand the processes envisaged by the amended Bill and the suggestions that had so far come forward were part of a process that all countries had.  He condemned the attitude of CCCI towards an Act that had been in place but needed revision because of circumstances.

Institute of Race Relations

anthea jeffriesRight from the start of hearings, the first being from the South African Institute of Race Relations (SAIRR) represented by Dr Anthea Jeffrey, the point was that in the case of poorer folk the whole question of court litigation costs was not only a dubious issue but the time frame for lodging an appeal had to be extended from 60 to 120 days.

When asked why SAIRR should become involved in land issues, Dr Jeffrey replied that it was just a question of the unconstitutionality of the issues and for many years SAIRR had been involved in discrimination against black land ownership.

She said that under the present Act the validity of any expropriation could be challenged, whereas under the new proposals it could not; SAIRR was deeply concerned that all types of property could be expropriated; property that was expropriated “in the public interest” should be better defined and she asked that the new Bill should trump all other Bills.

She complained that Bill in no way assumed responsibility for loss of livelihood; loss of property and the unintended consequences of taking land. She reminded MPs that over 8.6m black people owned their own homes in South Africa.

Dr Jeffrey was asked what she meant by making the remark that “a number of interested organisations would be taking the current wording to the Constitutional Court if the wording should stand”. Would SAIRR really appoint silk and go to the Court, they asked.  She replied succinctly, “It totally depends what you put in the Bill”.

Earlier, Ms Vuyokazi Ngcobozi, Parliamentary Legal Advisor, reminded the Portfolio Committee that it needed to be mindful of Section 25(2b) of the Constitution which states that if parties did not agree on compensation, they should approach a court.

People could not afford to take the route of going to court, she said, and arbitration was expensive. However, this was a right which is provided for in the Constitution. Alternative approaches had to be considered, she said. There was, throughout the hearings, much debate on which courts should be used.

Eskom goes up front as reason

eskom logoEskom in its presentation said that it was currently experiencing significant delays in acquiring servitudes for the construction and installation of its infrastructure and this was largely due to an “ineffective expropriation process”. They quoted one essential transmission line to the Western Cape which had been held up for six years and one even more critical line to the Vaal Triangle industrial area held up for four years.

When asked why the land had to be bought, Eskom said in many cases this was the only route to acquire rights. At this point, the Deputy Minister responded that there was absolutely nothing against the acquisition of servitudes in the public interest but the issue remained the market value for such rights, whether ownership or servitudes, and the Bill itself therefore remained a Bill about expropriation of such rights.

SA Institute of Valuers

This point was made by Saul du Toit of the SA Institute of Valuers (SAIV) in urging both the committee and the department not to leave the notion of value as openly definable and to align it with market value for purposes of fairness and constitutionality and the rights of a property owner.

He found himself answering provocative questions from EFF members who stated the land was not the property of the current owners in the first case so the question of rights did not apply.

Mr du Toit urged members of the EFF to obtain a copy of “Grundrisse” by Karl Marx, in which Marx explained how “labour” actually allocates a certain value to land.  He again confirmed that it was highly doubtful whether some magistrate’s courts, which had to take a fair share of the load of expropriation cases away from costly High Court actions, had the experience but not necessarily the competence, to deal with expropriation matters.

One submission, from a valuator, Mr Peter Meakin, suggested that that all land, as in Hong Kong, should become state land and leased back to owners, thus completely changing the structure of taxes and rates into rent and leasing costs, making expropriation a much easier matter, providing just compensation for property only as the main issue. The impracticality of this suggestion led to very little debate.

Agric-SA- “process must totally protect”

agri-saMs Annelise Crosby, parliamentary representative for Agri-SA, said they “supported orderly land as a prerequisite for rural stability and inclusive rural development.” She stated that “expropriation should only be used as a last resort where negotiations had failed”.

Agri-SA had been totally opposed to the original 2008 Bill on the basis that it restricted access to the courts and was not in line with Section 25, 33 and 165 of the Constitution and she said that government “should be applauded for the extensive and inclusive consultation process which it undertook on the 2015 Bill before the showed significant improvements”.

However, expropriation without compensation, she said was traumatic, causing financial loss, emotional stress and suffering.  Agri-SA proposed that the full 100% of compensation offered be paid to the owner on the date which the state took responsibility of the property. Under no circumstances should an expropriation lead to insolvency on the part of the land owner because the compensation was not sufficient to settle the loan secured by the mortgage bond and settlement paid in time.

Claimants, she said, should as far as possible be placed in the same position as was the case before the expropriation. The definitions of “expropriating authority” and “public interest” were broad and left a lot of room for uncertainty.

Also Ms Crosby said, “due regard must be given to the owner’s right to privacy and these should therefore be resolved in the wording, submitted by Agric-SA, before the Bill was finalised if it was to be acceptable.”

Banking Assoc: Expropriation should only be for land

basaThe Banking Association of SA (BASA) went a stage further, stating the whole preamble to the Bill and the Constitution should be altered to state that the Bill be restricted to land, water and related reform as opposed to “other types of property”.

BASA noted since the instigation of the original Act the word “property” had become a debatable issue at law. This was agreed later by Minister Cronin and not even the Constitutional Court had been able to rule on this.  BASA pointed out that the Bill had to be aligned to the Constitution which called for “just and equitable” access to land which was missing in the proposed Bill, thus there being no adequate safeguard against abuse of the power to expropriate.

BASA stated that the new Bill left out the previous expression of “consequential loss” contained in the original Act and any replacement or amendment should be aligned to relevant international norms and standards. In terms of global regulatory requirements, they said, lenders are required to make use of market values against which mortgage loans are made and they could see “no valid reason” for leaving out the relevant clauses as contained in the original Act.

“Expropriation is a drastic measure which places an inordinately heavy burden on the shoulders of particular individuals. The full extent of their consequential loss must be taken into account, not disregarded”, BASA emphasised. They disagreed with the concept that any property that had been “taken without the consent of the expropriated entity or person” should not be taken into account.

BASA set out a full alternative set of wordings and concluded by urging government use caution and act in strict compliance with the Constitution, especially in cases when a heavy burden on the expropriated person became apparent. They concluded with the comment that South Africa could ill afford to have an Expropriation Bill that works against investment growth and the creation of jobs. This was not conducive to a satisfactory international business environment, they said.

Taking bits out of land destroys values

The South African Institute of Valuers (SAIV) further said that land assets should be considered as holistic units and should not be divided up by any expropriation process since the units thus divided, they argued, become non-viable and lost their use or value. The expropriation process, they argued, had to be related to market value for purposes of fairness and constitutionality.

Discussion again centered on what courts should be used, SAIV sharing its experience with the Gautrain expropriation where some 1,400 cases of expropriation were satisfactorily concluded by arbitration before the necessity of going to the courts arose.

SAIV called for privacy on compensation agreements, for if the amounts paid, the Institute said, were to become public, landowners could rely on data from previous cases and play these off against each other as well as against the state.

Minister Cronin’s consistent assurances throughout the hearings that the amended Bill was benign on the issue of expropriation and mainly for state utilities to complete infrastructure projects was challenged after a submission on the third day by Prof. Ruth Hall for Institute for Poverty, Land and Agrarian Studies (PLAAS)

She said the amending Expropriation Bill highlighted “the necessity to bring expropriation laws and theirRuth hall compensation components into line with the Constitution in order to remove the ‘veto power’ of landowners in relation to land reform and to ensure consistency in expropriations undertaken by the different arms of government.”

Prof. Hall said that the proposals, for the first time, properly phrased historical factors into a Bill, particularly regarding the shaping of compensation in order to address the apartheid legacy and the necessity for redress. She said a state “advisory panel on expropriation” could provide all citizens with a cost free framework for negotiations and arbitration in order to address the costly and “intimidating” court system.

Minister Cronin hastened to assure Prof. Hall that this legislation, like much of South Africa’s current legislation, had the main purpose of addressing improprieties of the past and was designed to continue the process of redress.

sapoaThe South African Property Owners Association (SAPOA), represented by Adv. Gerrit Grobler, felt that in broad terms the Bill conformed to international standards and the department was to be commended. “It is workable, practical and constitutionally sound but there were a few outstanding matters needed to be attended to and that the Bill could not go forward as it was.”

Originally only the High Court where the property was situated could determine compensation for all instances of expropriation, Adv. Grobler said, but in 1975 the Expropriation Act provisions allowed for compensation to be decided by a magistrate but subsequently were deleted from the Act because compensation mostly fell outside the experience of magistrates.  This had to be cleared up and decided upon, he said.

He advised that the 60 day notice of expropriation was too short and felt it would not meet constitutional muster.   It could not be expected that property could be valued and a claim for compensation prepared in such short time. He suggested 6 months in the light of court rolls being overloaded.

Mr M Ndlozi (EFF) said that SAPOA represented land and property of capitalists, some of whom were the main beneficiaries of the policies of a criminal government. SAPOA needed to have a conversation around the criminal acquisition of land, he said.

Adv. Grobler, when replying, said if a property owner who had paid full value for the property, whether in 1960 or 1975 and the property is taken away, then the owner would lose the market value which he or she had paid for the property. That was a fact. If the land was acquired for nothing, then this would be taken into consideration.

gerrit groblerAdv Grobler said he was not a politician but a lawyer and therefore could not discuss any member’s personal ideologies. He followed only the Constitution which outlined the principle that compensation for expropriation be paid.

However, SAPOA continued with the proposition that High Courts, or preferably arbitration beforehand, had to take place first in terms of the Constitution but the argument remained, as had been stated from the start of the hearings, that these costs were too high and the period in which a defence could be prepared before expropriation took place was too short. This had to be reconciled, he said.

Adv Grobler again repeated that the Bill was a good piece of legislation which needed a few technical adjustments. Magistrate courts were specifically good in matters relating to criminal law but not to expropriation. However, he stressed that the proposals would “not serve the bottom end of the market”.

Deputy Minister Cronin thanked the presenters for providing clarity on the jurisdictional areas of the High Court and the Minister notably remarked that it made sense to begin assessing things from a market value point of view.

On the Eskom matter, he said the problem with Eskom was that the entity was pursuing the “willing buyer, willing seller” approach and a couple of landowners held out to drive up prices. Therefore such a Bill as tabled was important to tackle land acquisition although it had to be in line with the Constitution.   Adv. Grobler was thanked by the chairperson, Ben Martins, for his thoughtful observations.

cosatu2The Congress of South African Trade Unions (COSATU) submission descended into an argument between their need for an answer why land restitution had “failed so far” and the fact that the land was “stolen” in the first place. A response was made by FF+ member, F Groenewald, that most of the land referred to had been stolen from the Khoi-San by such historical parties as King Shaka in the first place.

Chairperson, Ben Martins, called for order and asked both parties to continue their debate “at another timeBenedict Martins in a different place” since the issues were irrelevant to the meeting.

However, Mathew Parks, parliamentary coordinator at COSATU, submitted the view that government should never compensate theft and emphasised that arbitration should be able to take place prior to referring to a court at low cost. The present process was, moreover, described as long, costly and intimidating. This could be sorted out without changing the Bill.

He suggested as a solution the development of an advisory panel on expropriation which would provide actors in a dispute with a comprehensive framework, enabling the development of fruitful negotiations.

He described the recent criticisms directed against the Bill in the media as attacks lacking any foundation. He urged members of the committee to vote in favour of the Expropriation Bill as it stood.

In conclusion, Deputy Minister Cronin said that Department of Works and his Ministry Department had much benefited from the general support and advice contained in the majority of the submissions. It was a Bill which was now perceived as a nearly completed and was now a working document which any government needed to bring matters in line with international practice.

He added that the Freedom Charter “did not contain any reference to the possibility of nationalising any land” and this was a “red herring”.

Other articles in this category or as background
Expropriation Bill has now to be faced – ParlyReportSA
Zuma goes for traditional support with expropriation – ParlyReportSA
Expropriation of land stays constitutional – ParlyReportSA
Amended Expropriation Bill returns – ParlyReportSA

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Land Holdings Bill joins state acquisition trend

Any new land holdings by foreigners to be excluded…

bbc logoThe BBC on their website quotes Minister Gugile Nkwinti of Rural Development and Land Reform (RDRL) as stating that a Land Holdings Bill “would be introduced to the South African Parliament by 2019″ which would, quoting the Minister further, restrict to locals the purchase of new land in terms of South African law.

In the light of the ministry involved and its mandate, this is likely to mean “productive” or agricultural land.

On their website and under the heading “SA to fast-track bill to block land sales to foreigners”, the BBC further reported that according to Minster Nkwinti this “would not mean annexing of current properties as this would be unconstitutional”.

Too much owned by foreigners

A weaker rand and lenient property laws had contributed to the South African decision, said the BBC, and further quoted the Minister as stating that “7% of land in SA was currently owned by foreigners.”  Minister Nkwinti has since said it might be less than 5%.

A “foreigner”, said the BBC,  is as per “the definition used by the South African Department of Home Affairs”.

Gugile_NkwintiLocally, Minister Nkwinti has said that Bill is to be tabled urgently in Parliament but that he had “no problem with the Bill being processed in the financial year ending 2016”. It is important to realize, he said, that the Bill will apply to agricultural land ownership only, or what is termed “productive land”.

Other Bills in process on expropriation

When the first outcry against the Bill was heard in South Africa, the BBC continued, it was soon confirmed by the RDRL department that residential property was not being targeted. Most of the argument against the Bill has been on constitutional issues, backed by a fear that this is the “thin edge of the wedge” in terms of investment certainty, the BBC concluded.

The reason for the Bill, Minister Nkwinti also said during a local media briefing in the parliamentary precinct, was to “address land reform and food security in South Africa.” The property referred to was that which exceeded a 12 000 hectare ceiling and the minister added that “on the basis of a just and equitable principle we shall pay for any land.”

A separate Bill is now to be enabled whereby a state valuator post is established to evaluate whether a stated market price is fair or not and to process such acquisitions. How independent this valuator will be from state pressure is not clear.

This is all in tandem with an Expropriation Bill, stated as being more designed to meet state infrastructure requirement needs, the acquisition of land for state electricity transmission grids being quoted by Deputycronin  Minister Jeremy Cronin, who briefed Parliament on the Bill, as an example. However the Bill is unclear on the use of the words “in the public interest” and what constitutes  “property” in terms of the tabled Bill.

Also out for comment at present is a Promotion and Protection of Investment Bill tabled by the Minister of Trade and Industry which deals with the subject of foreign based investment in South Africa and the “protection” of local industry and local manufacturing.

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Expropriation Bill has now to be faced

Much of the sting goes out of Expropriation Bill…..

landseizuresThe subject of expropriation, not necessarily of land but any property, has now reached the stage of a considerably watered down third Bill which has now been tabled and whilst there are grumbles from many quarters, it appears that the new Bill has not caused the same furore as its predecessors.

The long awaited Expropriation Bill (B4-2015) came before Parliament in the form for a briefing to the portfolio committee of public works attended by the minister of public works, Thulas Nxesi, the briefing itself remaining very much in the hands of the deputy minister, Jeremy Cronin.

Great emphasis was laid by both ministers on the difference between expropriation as a “public purpose” and expropriation “in the public interest”, a difference they said that was clearly laid out in South Africa’s Constitution.

Public purpose, public interest

nxesiMinister Nxesi in his introduction said if there was a need to put up electricity lines or build a road, it was then for a “public purpose” and he saw that there could be no argument – a statement which was later queried by opposition members.

However, minister Nxesi said, expropriating property for “public interest” had to pass a rigorous rationality test as stipulated in the Constitution but a major problem with all Bills previously tabled was that there was no recourse to the courts and on this issue the cabinet had decided to withdraw them. Jeremy Cronin seemed to come to the rescue with a far more detailed and rational presentation.  

He argued that expropriation was an essential mechanism or tool for any state in any country to acquire property under certain instances but much emphasis had been laid in South Africa on the issue of land and white commercial farmers.

He admitted that whilst “public interest includes the nation’s commitment to land reform” in the Bill before them, a fact emphasised in the preamble to the Bill, the proposed legislation was very much in the nature of a mechanism to deal with expropriation rather than say who it applied to.

Expropriation just a “tool”

croninMinister Cronin added that this was one of many reforms taking place to bring about equitable access to all South Africa’s natural resources and reforms to redress the results of past racial discriminatory laws or practices. Such a preamble existed in much of South Africa’s legislation since 1984.

He said, “The Constitution requires “just and equitable” compensation to be determined by having regard of all circumstances without placing undue weight on any single or particular factor. National, provincial and local government were empowered to expropriate property to varying degrees through several pieces of legislation, he noted.

Deputy minister Cronin tracked the history of the Bill before them stating that the 1975 Expropriation Act was totally unconstitutional as it gave draconian powers to the state and was “wisely” withdrawn. A further 2007 Bill was also removed on these grounds and the current Bill was unable to be processed for Parliament before the 2014 elections.

In line with Constitution

settlement_law_justice_However, he said, the Expropriation Bill B4-2015 seeks to ensure consistency with the Constitution and to provide uniformity of procedure of all expropriations without interfering with the powers granted to the expropriating authorities.

Opposition members claimed that the Bill enlarged upon the definition of “public interest” contained in the Constitution and the Bill could not do this constitutionally. Nor did the Bill talk to in broad terms to the issue of compensation, whether it be a commercial farm or alternative accommodation for a shack dweller.

They argued that the new Bill did not talk to the issue of the interest of a bank in terms of a mortgage and where the bank might stand on such issues. The Bill now tabled, minister Cronin said, detailed the manner in which the expropriating authority had to follow, as well as setting up the process of evaluation and the authority to do this “in a just and administrative way”.  

On mortgages and loans from a bank, he said it was the bank that will be expropriated and not the individual.

Credibility of Bill challenged

masangoDA member Masango contradicted this and said any agreement or loan was between a person and the bank and not the state and the bank and he asked how the Bill could have possibly got through the NEDLAC process.

He also raised the issue of poor people not be able to afford litigation if the process of expropriation was contested. ANC member Madlopha said “whilst the media had been rubbishing the Bill, saying that it targets white commercial farmers”, the Bill in her mind gave the state power to expropriate with only a simple notice to the property owner, a process which seemed to contradict with common law.

Blaming apartheid and more

Minister Cronin responded along the lines that in expropriation, the property clause in the Bill of Rights guided the process. Indeed, argument, he said, will no doubt occur on “just and equitable compensation matters” but this did not remove “the consideration of colonial injustice”.   

It was the Constitution, he said, that insisted that in determining “justice and equitable” compensation it should include the process of “restitution”. Deputy Minister Cronin commented that expropriation did not just affect white commercial farmers and any compensation would consider the amount of bond outstandings. 

He concluded that the new Bill was attempting to shorten the process of any litigation. He added that the NEDLAC findings on the Bill would be supplied to Parliament and suggested that the committee ask Agric-SA to appear before them to obtain their views.

Other articles in this category or as background

Zuma goes for traditional support with expropriation –

ParlyReportSA New approach to land reform – ParlyReportSA

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Zuma goes for traditional support with expropriation

Editorial….

Session ahead may bring clarity on expropriation…….

NAIt is a difficult time for business and industry to establish exactly where they are in terms of the legislative environment in South Africa, land expropriation and state or BEE participation being mainly the issues.  However, the cabinet must be aware of the need expressed in many circles for more certainty in terms of the investment climate.

The Bills held back by the Presidency for re-consideration or signature are re-emerging slowly back into the public sphere.   Aside from the highly controversial Traditional Courts Bill adding power to the arm of President Zuma’s supporters in rural  leadership roles but offending women’s rights groups, now re-tabled in Parliament in a different form, as a section 76 Bill, is the Expropriation Bill.

Being a 76 section Bill means that the proposed changes and the formation of a state valuator’s office as thezuma traditional final arbiter on land restitution will have to be debated in all nine provincial legislatures and a mandate provided to the National Council of Provinces to gain concurrence with any vote on the Bill taken in the National Assembly. 

It is interesting to note that some time ago, President Zuma let it be known that he would also like to see this Bill considered by the House of Traditional Leaders. This is probably in the light of the debate now emerging that traditional chiefs were not consulted properly, if at all, in terms of the Restitution of Land Rights amendments.

Serving notice

Crucially, the Expropriation Bill still seeks to allow any ‘expropriating authority’ to take property by serving a notice of expropriation on the owner stipulating the value the state will pay, presumably according to the state valuation if there has been an appeal.

Commentators have noted that the new Bill differs in that the state may then serve a further notice of expropriation, which could be less, more or not necessarily revised at all, and the owner will be deemed to have accepted that transfer of land to the state unless the owner commences litigation within 60 days.

The short amount of time to respond and appoint and brief counsel and the fact that litigation, a highly costly process (costs being to the owner not the state), will no doubt be an issue debated extensively in Parliament. At this moment the main opposition party has been caucusing on the Bill. The fact that the Bill will now have to be debated in all nine provinces will leave a fluid situation for some time yet.

Struggling to produce

The Protection of Investment Bill remains an unknown quantity. Speaking to the DTI legal advisor, all he could say was “We are struggling with it”. 

Similarly, no tabling notice has been published with regard to the Private Security Industry Bill.

No energy  outcome

At the time of writing the “Five Point Energy Plan”, promised by the cabinet “war room”, has also not been presented to Parliament, the minister of energy advising all that it was necessary to have first a trip to the DRC and discuss the Grand Inga Hydro project.

Instead of her unadvised non-appearance in Parliament, a presentation by the department of energy took place, monitored in this report. What did emerge however was that future regarding the intended energy mix is also very fluid, there clearly being a division of interest in what is necessary to bring about in the short term better service delivery to the poor and in the longer term the needs of investors.

Traditional support

Time and time again, since his state address to the nation, President Zuma, where land matters are concerned, has made reference to the Council of Traditional Leaders, the majority party having no doubt realised that this base of power can either be pacified or radicalised – a very sensitive area and where the least service delivery by government occurs.

In his speech opening the National House of Traditional Leaders, he encouraged traditional leaders to take advantage of the 2013 Restitution of Land Rights Act as amended and rushed through at the end of the last Parliament and for them to put in claims.

The amendment Bill passed reopened the window for lodging restitution claims, but retains the restriction that dispossession must have taken place after 1913. The hints by the President in subsequent days in further briefings that the date of 1913 “is negotiable” have led to further claims being notified some of them apparently going back many hundreds of years. 

Once again, this will only be finalised when parliamentary debate finally takes place as the issue is bound to be raised but the whole matters adds to current uncertainty.

Hole in the pocket

Meanwhile the budget for what can be paid out in the form of restitution has been decided by minister of finance Nene and was presented in the last budget to Parliament in the current session.

President Zuma’s reference in Parliament to land held by foreigners in the state of nation address produced an unfortunate atmosphere which was somewhat mollified by off-the-record remarks by ministers to the media but no legislative clarity for Parliament to consider has emerged.

Indeed, a difficult time for business and industry, not forgetting that the Eskom issue is about to be raised again in forthcoming portfolio committee meetings in the coming week, hopefully bringing some clarity to the issue of reliable electricity supply.

Editorial only

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NEDLAC gets called to task

NEDLAC not clear on performance……

nedlac logo smallDespite having received an unqualified audit from the auditor general on its annual financial statements, National Economic and Labour Development Labour Council (NEDLAC) officials were requested by the parliamentary portfolio committee on labour to re-present their financial statements to give more clarity on how their 2013/4 budget had been spent.  Once again, chairperson Lumka Yengeni  established that any labour portfolio committee meeting  is no walkover.

Members of the committee complained that the figures presented by NEDLAC needed to be presented on a quarter by quarter basis and had to show specifics of categories spent against budget. Five working days was given for such a report to be in the hands of chair of the committee, Lumka Yengeni.

Mkhize left for family reasons…

Alistair Smith, Executive Director of NEDLAC, who replaced Herbert Mkhize in the 2011/2 year, the same year as that being subjected to special forensic audit by the auditor general, is now himself resigning. When asked by Ian Ollis (DA) why this was so, he said that he wished to spend more time with his family, indicating that total retirement from the business world was on the cards.

The committee noted that the special forensic audit, only recently commissioned, was not of specific interest at this stage as it was a separate matter not connected to the year under review and in any case the report was not yet ready.  However, chair Lumka Yengeni said the financial report now presented to the committee by NEDLAC gave no idea of performance against objectives and equally no idea of programme targets, all of which was the purpose of parliamentary oversight.

Alistair Smith in his review promised to meet the deadline for a fresh report and said that whilst it was the job of NEDLAC to promote economic growth, social equity and decent work through a culture of social dialogue and engagement to bring about effective participation in policymaking and legislation, performance was dependant on stakeholder partners.

Urgent talks on future

He warned MPs that in the short to medium term South Africa’s growth prospects are constrained by global conditions and domestic factors, including low investment and savings, weak domestic demand, low business confidence, energy constraints and challenges in our labour market.    “We need to have urgent conversations about how to tackle these growth constraints and these conversations must be guided by a willingness to resist quick-fix and knee jerk solutions”, he said.

Alistair Smith pointed to the fact that in the area of legislation NEDLAC had achieved much in 2013/2014 despite the constraints of a difficult year due to elections and a change in ministers and their portfolio responsibilities.

Dealt with by NEDLAC during the year had been the Restitution of Land Rights Amendment Bill; the Gas Amendment Bill; the Expropriation Bill; the Public Administration Management Bill and the Unemployment Insurance Amendment Bill, Alistair Smith reported.

New legislation ahead

Currently in hand were meetings and study groups dealing with a new Housing Consumer Protection Bill; amendments to the Occupational Health and Safety Act: compensation factors added to the Compensation for Occupational Injuries Act: regulations for assessment of work of equal value; and a review of the Codes of Good Practice on dismissal factors.

He also warned parliamentarians that it was “necessary that we take stock of the state of our society and especially of the socio-economic challenges that threaten our social cohesion and may eventually even threaten our hard won democratic gains.”

NEDLAC’s balance sheet showed that of the appropriation of over just under R27m, well over 26m had been spent in time and that the long outstanding risk management committee was about to be formed. A complete renovation of the entity’s headquarters, known as NEDLAC House, had been concluded at a cost of R30m.

Also completed,  Alistair Smith said, was work on the Extension of Security of Tenure Amendment Bill and much had taken place with regard to the extended public works programme; access to housing finance; small business financing;  and research on tax matters for the Davis Tax Commission.  Of immediate concern, he concluded, were meetings concerning the National Land Transport Bill.
Other articles in this category or as background
http://parlyreportsa.co.za/cabinetpresidential/nedlac-gets-a-stronger-voice-in-sez-management/
http://parlyreportsa.co.za/bee/back-comes-gender-bill-for-rethink/

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Amended Expropriation Bill returns

Previous “problem” areas addressed…

ThembelaniNxesiOnce again to be tabled by the minister of public works, Thembelani Nxesi, cabinet recently approved what has been promised a much amended Expropriation Bill which will first go for public comment – a government spokesman stating that the problem areas of the previous Bill withdrawn during the parliamentary process two years ago having been addressed. The controversy surrounded what was defined as “the public interest”.

In a statement following a post cabinet meeting briefing in Cape Town recently, a cabinet spokesperson said that proposed amended legislation will aim to “achieve certainty and give guidance to those involved in or subject to an expropriation process, both for the state, as well as a private individual”.

She promised that the draft would be published on the department’s website shortly.

Constitutionally acceptable

The draft bill and its forerunner is intended to repeal the current Expropriation Act of 1975 and according to cabinet, the bill will ensure that expropriation is carried out in accordance with constitutional principles and within the “spirit and provisions” of the Constitution.

The draft bill has been under discussion at NEDLAC, a process which follows immediately after approval by cabinet, the next stage being for the minister of public works to call for public comment.

Bill acts as guidelines

Speaking last year, the public works minister, Thembelani Nxesi, indicated that the purpose of the bill is to align the existing statute with the Constitution in order to provide a common framework to guide processes and procedures for the expropriation of property by all organs of state.

Agri SA, the main representative farming body in South Africa, led the objections to the previous bill which formed the basis of acrimonious debate in Parliament based on objections on constitutional grounds.   Most of the problems surrounded the definitions of what the minister might use as a reason for expropriation “in the public interest”.

AgriSA will be watching

This was followed by the Bill’s subsequent withdrawal after advisement by specialist constitutional experts appointed by the parliamentary legal advisor.   Agri SA warned at the time, “It is clear that legal and market principles could be violated if such an approach as is worded at present is adopted”.

The cabinet spokesmen has now stated that the new draft “seeks to achieve certainty and give guidance to those involved in the expropriation purpose, both for the state as well as a private individual”. Further comment was that any expropriation would be subject to a price that would recognise the situation of what the status quo was on prices before the issue of expropriation came up.

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Posted in Justice, constitutional, Land,Agriculture, Trade & Industry0 Comments

We can do better says new public works minister

Thembelani Nxesi, minister of public works minister, during his maiden budget vote speech, told parliamentarians that he welcomed the budget of nearly R8bn for next 2012/13, saying “while it represents an increase of approximately 2% from the previous year’s budget, it sends a clear message that the department must not think of a real increase in budget, until there is real improvement in performance”.

On the leases, the minister said there were no quick wins as years of poor management, under capacity and lack of financial controls had provided fertile terrain for fraud and corruption. Minister Nxesi says serious irregularities have come to light, thanks to the detailed work of the Special Investigating Unit.

On this issue, Nxesi said, “To give a sense of the scale of the task we face, the department manages approximately 3000 leases – of which a quarter has lapsed and is being paid on a month by month basis. Recent media reports have highlighted problems experienced by the South African Police with their accommodation. To place this in perspective: we manage 1,277 leases on behalf of SAPS.”

Twenty-two such leases have already been identified in one region alone — involving payments of over R64m, the minister told parliamentarians. He said, “This includes leases where the department paid for the duration of the lease without the building being occupied. We have instructed our lawyers to approach the High Court to nullify these irregular lease agreements, and institute civil action against whoever unduly benefited. “

He said, “Criminal cases are being opened against several officials; more are expected. I am informed that some criminal investigations have been concluded and arrests are imminent.”

The long-awaited Expropriation Bill will be tabled during 2012, said Nxesi. This was shelved in 2008 after objections that it was unconstitutional since the draft aimed to allow the state to expropriate farms in the public interest, including for land reform.   The issue was, when the bill was shelved, as to whether government officials, rather than the courts, should decide on the amount of compensation for owners of expropriated farms .

Previous minister of public works, Geoff Doidge, said last year a new draft was underway and would be “be applicable across the board as appropriate in constitutional terms for all state entities to use where a common framework is needed as a guide to expropriate property”.

Legislation will also be introduced “reforming” the Council for the Built Environment, Nxesi said.

Posted in Cabinet,Presidential, Finance, economic, Public utilities, Security,police,defence, Trade & Industry, Uncategorized0 Comments


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