Article of the Month - August 2015

What People Want

Chris WILLIAMS-WYNN, South Africa

 
Chris Williams-Wynn

 

1)  This paper was presented at the FIG Working Week in Sofia, Bulgaria, 17-21 May 2015. Land administration in South Africa is an interesting study because it consists of a dual system that has promoted investment in areas where private property rights were permitted, but relegated the Traditional Communities into poverty and disinvestment. The paper shows that the concept of ownership, land rights and title deeds goes much further than the ability to buy and sell property.

SUMMARY

Notwithstanding the minority of authors that disagree, most research has shown that private property rights provide far greater incentive for an individual to create wealth and preserve the value of his/her assets than State or communal ownership does.  In South Africa, policies of separate development and restrictions placed on capital expenditure imposed on the lands occupied by the indigenous people during the colonial era prevented the state from implementing the Cadastre in the communal areas of the country.  The status quo persists to this day, which has resulted in a dual system that promoted investment in areas where private property rights were permitted, but relegated the Traditional Communities into poverty and disinvestment.   

By observing the layout of rural communities, it is evident that people have made an effort to define the boundaries of their land rights through the erection of fences, hedges, stones and other visible features.  In this study, therefore, the representative sample of community members provided a broad indication of what people living in Traditional Communities across South Africa wanted in terms of land rights.  The results were twofold:

  • Firstly, members of traditional communities were seldom interested in land as a marketable commodity: community members perceive themselves as the current custodians of land belonging to their ancestors, the living and the members of the community still to be born.  This is supported by findings of other researchers such as in Goodwin (2014, pp.9–10).
  • Secondly, members of a traditional community primarily want identity.  They want to be identified with the land they occupy.  Each one wants documented evidence that links him or her to the land that he or she was born to share.  Each person wants proof that indicates: “this is our land, my land; we belong, I belong!”    

Settlement Patterns of a Rural Village on Communal Land near Mount Frere, Eastern Cape
Photo: Mark Williams-Wynn

INTRODUCTION  

The Government of South Africa recognises 12 monarchs and 774 other Traditional Leaders (Department of Provincial and Local Government, 2002, p.39).  Traditional Communities have been allocated approximately 15.5 million hectares of communal land for occupation under these Traditional Authorities, which equates to 13% of the country.  It is estimated that there are 15 million people (between 30% and 40% of the South African population) who either live in these Traditional Communities (Department of Land Affairs, July 2004, p.12) or perceive the communal area to be their “home” (Goodwin, 2014, p.2).  Apartheid settlement patterns in South Africa have resulted in extra-legal “rurbanisation”, where less-formal urbanisation has taken place in rural confines.  Lack of infrastructure (including legal structures) and resources in these rural areas has resulted in suffering, need and dependency (FIG, August 2004, p.14).  

Seldom is this land occupation recorded in any form of land right, even outside the formal land administration system.  The lack of legal recognition of ownership of the land that these communities have occupied for generations may have resulted in unwillingness of members of those communities to invest time, effort or capital into the land they call their own.  It certainly cannot be viewed as a capital asset.  Yet, well-defined boundaries of fences or hedges, which surround many homesteads in these communal areas, indicate an informal yet recognised exclusivity and right of use.  The South African Government’s own Accelerated and Shared Growth Initiative (ASGISA, 2006, p.14) recognises that land remains an unusable or “dead” asset until land tenure is instituted and formalised.  Property rights are one of the market-supporting institutions missing in the communal areas and, because they are a missing component of the infrastructure that promotes economic development, they limit private-sector investment opportunities.  Therefore, one of the keys to local investment in communal areas is the creation of tenure security for the people who have occupied their family allotments for generations.

Hedges identifying homestead boundaries on Communal Land near Mbazwana, KwaZulu-Natal
Photograph: Justin Williams-Wynn

In support of this contention, Heitger (Winter 2004, p.384) argues that the promotion of economic development without well-defined private property rights (as was attempted in the Soviet Union) turned out to be “very costly in terms of life, personal liberty and economic prosperity”.  Zirker (Summer 2005, p.127), writing about inequities in ownership in Brazil, notes that ownership is a privilege of the elite and that landlessness is the lot of the masses, and voices the demand for a re-evaluation of the distribution of property ownership.

Further, and particularly in Western countries, the owner of a land right can use his or her title deed as security with a financial institution in order to raise a loan (Blair et al, 2005, pp.50–52).  Land rights have worked in the West, and they have worked in South Africa:  through the generation of active capital from formal property rights, many South Africans have realised their dreams of improved economic security.  Conversely, those who do not have anything but insecure tenure perceive that the Traditional Community provides them with little more than some form of social security (Goodwin, 2014, pp.5–6).

Section 25 of the South African Constitution (Republic of South Africa, 1996) clearly states that: “no law may permit arbitrary deprivation of property”?  The Constitution further places an obligation on Parliament to ensure, through the enactment of legislation, that all people and communities are provided with secure tenure.  It therefore seems illogical (at least to the researcher) that the South African land administration system still retains what Mamdani (Fall/Winter 2002, p.53) refers to as the “bifurcated legal structure” created by the colonial practice and apartheid laws of the former regime.

Fences separating a homestead from a communal tap near Mseleni, KwaZulu-Natal
Photograph: Justin Williams-Wynn

THE DEMAND FOR PRIVATE PROPERTY RIGHTS  

The Land Summit meetings held throughout South Africa during the middle of 2005 indicated overwhelmingly that the people of South Africa want to own land.  One reason, as Nonyana twice states in her article on resolving tenure disputes in rural communities (Nonyana, June 2004, p.3, 7), is that “Land ownership is associated with power.”  Mobumbela, in discussion with authors Kayser and Adhikari (2004, p.330) declares that “when it came to the question of land, people were prepared to die.”  These perspectives are understood in the context of property rights being, according to Zirker (Summer 2005, pp.129–130), a “legal, equitable, or moral title or claim to the possession of property” and the “enjoyment of its privileges … [free] from interference by others, particularly the government”.  

de Soto’s hypothesis of why capitalism has failed everywhere except in the West (de Soto, 2001, p.55) argues that the reason for its success is that only in the West is property easily tradable and transferable.  Hanlon (September 2004, p.612–614), however, questions whether it is exclusively the western-type freehold title as proposed by de Soto that increases efficiency in the land market?  Instead, he suggests that the World Bank’s policy (i.e., Deininger, 2003) dismisses de Soto’s hypothesis.  Nevertheless, de Soto’s record of historical fact still stands: the United States was no better off in the 19th century than is Africa today (de Soto 2001, pp.15–16).  Their pioneers were seldom more than adventurers and fortune-seekers; yet, once the United States government of the day had recognised the claims of the settlers as legitimate land rights, the new owners had a greater incentive to invest in their land, which has supported the US in becoming the economic power it is today (Deininger, 2003, p.27).

The same is evident in South Africa.  All that the Afrikaner people had left after the ravages of the Anglo-Boer wars was their land rights.  What the British had not confiscated, they had burnt or destroyed.  Yet, within a few decades, admittedly with the support of discriminatory legislative measures, much wealth was re-established from the land.  Conversely, in Traditional Community Areas, where still no land rights are formally documented even after 20 years of democracy, people largely remain in abject poverty.  Ralikontsane (2001, p.69) argues that secure land rights are a necessary component of an effective land administration system and Kifle, Hussain and Mekonnen (June 2002, p.16) propose that good governance seeks to “create an enabling environment for the private sector—by ensuring respect for property rights and by creating legal and judicial systems that enforce contractual obligations and create a level field for private enterprise.”  Another argument given by Blair et al. (2005, p.231) is that “effectively enforced property rights are important for reducing investment costs and risks…”

Amidst much ideological opposition, the United States inculcated the concept of private property rights into the Third World during the 1960’s and 1970’s through its foreign policy influence.  The reasons for the promotion of land rights into the Third World were many, including the policy of undermining socialist ideologies and the means by which their investments in African territories could be protected from nationalisation and state intervention.  Over the years, these policies have evolved and, currently, the global community perceives that the primary objective of any land policy should be sustainable development (FIG, August 2004, p.16).  Therefore, much of the historic opposition to property rights (as epitomised by countries such as Cuba and Nicaragua) is currently weakening and, according to Zirker (2005, p.126), even the Chinese Communist party has recently announced that “private property rights ‘legally acquired’ are inviolable.”

Fences defining boundaries on Communal Land near Qunu, Eastern Cape
Photo: Mark Williams-Wynn

THE ARGUMENT AGAINST PRIVATE PROPERTY RIGHTS  

 Nevertheless, there are some dissenting voices to the clamour for property rights.  Zirker (2005, p.126) argues that property rights are essentially a Western capitalist concept and this is supported by de Soto’s hypothesis of why capitalism has failed everywhere except in the West (de Soto, 2001, p.55).  A reason given for the success of capitalism in the West is because capitalism works best where property is easily tradable and transferable (PLAAS Policy Brief, October 2005).  However, in a market economy, the poor are the most vulnerable and often their only means of generating capital is through the sale of their property.  Even though they may own the land that they occupy, they do not have the means to secure credit and they seldom have the capacity to repay a loan.  The PLAAS policy brief therefore argues that individual ownership actually decreases the security of tenure of many occupants.  This position is supported by reference to a study carried out in an economic housing development in Joe Slovo Park, Cape Town.  Hence, PLAAS believe that the property market promotes capitalism at the expense of livelihood security of the poor.

In another investigation into communal land rights, this time in Mexico, Munoz-Pina (October 2003, p.130), cautions that the cost of privatisation can exceed the expected benefits.  Firstly, there is a scarcity of willing buyers of land in communal areas and, secondly, the actual realisable land value is still very limited.  Even with economies of scale, the values of land parcels are unlikely to warrant the expenditure and, further, the benefit would be spread unevenly, depending on where the demand is.  Also, Munoz-Pina is concerned that community life, which provides “other advantages such as information sharing, mutual insurance and political clout” – i.e., collective action – would be destroyed.  Amin and Thrift (in Harrison, 1994, pp.84–85) also have negative perceptions when they consider that: “… efforts to regenerate the local economy through locally regulated ventures … run the risk of doing little more than legitimising a false belief in the possibility of achieving solutions for what are global problems beyond local control …”  They continue: “Somewhat bleakly then, we are forced to conclude that the majority of localities may need to abandon the illusion of the possibility of self-sustaining growth and accept the constraints laid down by the process of increasingly integrated global development.”

Fences and hedges defining boundaries on Communal Land near Tsolo, Eastern Cape
Photo: Mark Williams-Wynn

Are these truly justifiable reasons to oppose private property rights?  It is common knowledge that there are huge variances in the monetary value of property, depending on its location and its useful resources.  However, the author supports the contention of Azhar (October 1993, p.118) that land has no value at all to the occupant until he or she has the right to own and to trade it and to harvest the resources it provides.  Even so, much of the value of the land is determined by the land market, which is not concerned about the livelihood security of the occupant, especially where the occupant is very poor!  In all three cases – that of PLAAS, Munoz-Pina, and Amin and Thrift, therefore, very valid concerns are raised, but their concerns should be matters to protect against when creating land rights, rather than being reasons not to issue private property rights.

BENEFITS OF TENURE SECURITY  

This research needed, therefore, to look beyond the market value and tradability of land.  UN-Habitat’s document entitled “Global Campaign for Secure Tenure” (1999, p.7) advocates secure tenure because the body believes that it ensures there is progressive and sustained improvement in the living conditions of the beneficiaries.  Further, the provision of secure tenure advances the fulfilment of Target 11 of Goal 7 of the Millennium Development Goals – “to achieve a significant improvement in the lives of at least 100 million slum dwellers by the year 2020” through increasing the “proportion of people with secure tenure” (i.e., Indicator 31) (UN-Habitat, 2003, p.26).  Subsequent to the Millennium Development Goals, the United Nations established an Open Working Group (OWG) of Sustainable Development Goals to define agreed goals for the post-2015 Agenda.  The OWG has developed 17 goals with 169 targets.  Proposed Goal 1, target 4, reads: “By 2030, ensure that all men and women, in particular the poor and the vulnerable, have equal rights to economic resources, as well as access to basic services, ownership and control over land and other forms of property, inheritance, natural resources, appropriate new technology and financial services, including microfinance” (Open Working Group, 2014, p.7).

While UN-Habitat literature referred to above may have had its focus on urban areas, it is important to note that urbanisation of many Traditional Community areas is taking place, especially where they are in closer proximity to existing metropolitan areas.  These are highlighted in the research by Mogale, Mabin and Durand-Lasserve (April 2003).  Secondly, if the lack of security of tenure is a limiting factor in urban areas, how much more so in the rural parts of the Tr