First consider govt land for expropriation - economist

Stellenbosch – There is no reason why private property owners cannot insist that government first make public land available before expropriating private property, according to property economist Professor Francois Viruly of the University of Cape Town.

“To me the problem with the expropriation debate in South Africa is that public land, for example military land, is not first being made available before government turns to the private sector to expropriate property,” Viruly said on Thursday at a property conference hosted by Rode & Associates at the Spier Estate outside Stellenbosch.

To him the big question is around when the public could actually sue government to have public land made available before expropriating in the private sector for housing needs, for instance.

“To me the debate should therefore be about government looking at the private sector while the biggest holder of land – the public sector – is not making it available,” said Viruly.

To this, Deputy Minister of Public Works Jeremy Cronin replied that he agrees with Viruly regarding unused public land and buildings. In his view, there is nothing in the expropriation bill preventing one government department, for instance, from expropriating from another.

He used the City of Cape Town as an example of a huge amount of defence force land holding the potential to be used for mixed income housing developments.

Cronin also emphasised that the public sector needs to become much more professional, including in its property valuing capacity.

“We are committed to this, but I have to add that the office of the valuer general is not a silver bullet either,” said Cronin.

During question time, Cronin was asked why the expropriation bill does not address housing expropriation.

He replied that, although the bill does not address housing, it is incorrect to refer to it as a land reform bill, while it should rather be seen as an attempt to be a framework piece of legislation.

“The crisis in SA is less about rural and farm land than about urban spatial development. So the expropriation bill becomes potentially a valuable tool for addressing apartheid era spatial development,” said Cronin.

“The idea is for the expropriation bill to become an open-ended matter to be more clearly defined in other related legislation.”

In his view, the expropriation bill is less of a “blunt instrument” than the Expropriation Act of 1975.

“The expropriation bill gives a clearer indication to the courts and the parties to an expropriation regarding the expropriation process,” said Cronin.

He implored the South African public to remain vigilant in terms of governance, but at the same time to debate the expropriation bill without undermining the important aspects it addresses – and most importantly not to undermine the rule of law.

Dr Antonie Gildenhuys, a retired judge who was involved with the Land Claims Court, agreed with Cronin that the expropriation bill introduces complicated but necessary procedures. He too said it would be vital for government to develop the necessary expertise in the administration of the expropriation bill – especially to prevent excessive pay-outs.

“The bill does not move away from market value – although that is usually not the most important factor. It is used as a starting point,” said Gildenhuys.

As part of a panel discussion about the expropriation bill, attorney Simon Dippenaar said he wondered how people would afford the legal costs of objecting to an expropriation.

“While we have real property rights in SA, we live in unreal times because of the political turmoil. That is why it will be up to the courts to set our minds at ease on the expropriation process in SA going forward,” said Dippenaar.

Lastly, panel member Gary Fisher, executive chair of Capitalgro, said the expropriation bill is a bit of a red herring.

“It is not a silver bullet to eradicate inequality and unemployment in SA,” he said. At the same time, he does not think it will change international property investors’ view on the strength of property rights in SA.

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