Land restitution has some success

A recently released report has found that financial compensation for land restitution was mostly well spent, despite misgivings by the Commission on the Restitution of Land Rights.

In about 30% of the cases, the restitution award did produce “a substantial economic benefit” – according to the report, titled Paying for the Past: Addressing Past Property by Professor Bernadette Atuahene of Princeton University.

“The majority of these people spent their financial award on improving their current homes, thus increasing the value of their primary assets,” Atuahene writes.

In 32% of the cases, there was moderate economic impact and in 38% of cases there was only a small economic impact to the recipients.

Atuahene said that despite these successes, many commission officials had a dim view of their own work, according to anecdotal information. Some believe the compensation is wasted because the money is gone but the recipients are still living in poverty.

She quotes one official as saying: “Financial compensation is not having an effect. We will assist with payment in the morning, and in the evening everyone is in the bottle store. They don’t know what to do with the money.”

As a result of this view, Atuahene notes the commission has shifted its focus from financial compensation and is now emphasising land transfer. She argues that the commission should reconsider its new emphasis.

“Since the commission has proven it has limited capacity to transfer land, it must find ways to make financial compensation more effective,” Atuahene said.

She argues that the commission should offer more options for potential recipients. As an example, if the commission wants to promote home improvements, and a person is entitled to a R20 000 financial award, they should instead be given the option of a R30 000 voucher for building materials.

The commission could offer similar bonuses if they, and the recipients, wanted to use their financial awards for education or job training.

They should also provide financial counsellors to help claimants choose between their different options.

“The key is to give beneficiaries choice and to incentivise (sic), not force them to use their financial awards in ways that [will] have a lasting economic impact,” Atuahene writes.
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