15 May 2012

South Africa: Govt to Help Set Fair Prices in Selling Land

Cape Town — The Minister of Rural Development and Land Reform, Gugile Nkwinti, says government needs to be involved in setting fair prices when it comes to the willing buyer, willing seller practice of land reform.

Addressing media ahead of his Budget Vote in Parliament, Nkwinti said the state needed to be involved because the market alone would overprice the land.

When land was sold by a farmer to the state, it was estate agents, land valuers and others that benefited rather than farmers themselves, he said.

He singled out a recent case where he had been approached by the Chairman of the National Council of Provinces (NCOP) - who was concerned that the state had not been paid for farm land it wanted to buy in Limpopo because the land was priced too high - at R35 000 a hectare.

"They (department officials) met with the farmers and they asked us where do you get that story that we are selling farm land at R35 000 a hectare?"

He said the department's officials and caucus members then met and came up with a figure of R4 750 a hectare, meaning the farm was then sold for R6.9 million instead of R50 million.

"And the money would not have gone to the farmer, you see, it would've fallen through the cracks - between government and the farmer and that's the story here, and it's worrying that often we think it's the farmers that are ripping [the government] off," he said.

The minister said his department would continue to look at the issue of land ownership by foreigners, pointing out that the right to own land in another country was "a privilege and not a right".

He said exceptional circumstances did exist where expropriation was the best option for the state to take over land. He singled out an example where a Norwegian had bought land in Grahamstown and was later arrested for using stolen proceeds from a Norwegian municipality to buy the land.

The government, he said, was now negotiating with the Norwegian government to buy back the land.

However, in an example like this - where stolen money had been used to purchase land - it was better for the state to expropriate the land rather than to buy it.

The six working groups set up by the department last year to look at proposals under the Green Paper on Land Reform were still at work.

However, he said, to speed up the process, where there was progress in each of the working groups and proposals had been formulated, these would be put forward to the Cabinet to approve for implementation.

The proposals around communal land tenure, Nkwinti said, would take the longest to reach consensus on as they were the most difficult, while the working group looking at the proposal to set up a Land-Valuer General was moving along quickly.

The department on Tuesday also launched its midterm review, which details the achievements and challenges of the department since its launch in 2009.

The department's Director General, Mdu Shabane, said the report covers all the department's rural development initiatives in the country, including the Comprehensive Rural Development Programme and highlights the impact as well as the lessons and challenges of these initiatives. Shabane said the programme had expanded to every province, and nearly 200 000 households across the country had been profiled as part of the programme's aim to assist rural communities.

About 1.1 million planned parcels had been registered and analysed by the state and these were currently being verified with the aim of completing the verification process by next month.

The state had also bought over a million hectares of land since 2009. The department aims to survey 2.7 million hectares of state land by December. In all, 8 041 young people had been enrolled in the National Rural Youth Service Corps (Narysec) programme, since its launch last year. Shabane said they hoped to reach 15 000 participants by the end of this year.

About R400 million had been set aside to pay for the stipends of participants and the actual training, and would be complemented by a further R190m in funding from the Department of Higher Education.

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