OPINION | Expropriation Act won't solve SA's unemployment and poverty but aggravate both problems
SA's new Expropriation Act, which allows for the expropriation of property without compensation, undermines the property rights of South Africans and non-South Africans, and would have faced similar fierce opposition domestically and internationally, even if US president Donald Trump was not in power.
The constitution allows for expropriation with compensation if it is in the public interest. Contrary to those who pushed the Expropriation Act, it will not advance the transformation of black South Africans from poverty, unemployment and hunger to wealth, employment and abundance. It will do the opposite.
Contrary to statements by defenders of the Expropriation Act, it is only aimed at a small number of white farmers, it undermines wider property rights – which includes ownership businesses, pension funds, mining licences, shares, savings, intellectual property, government bonds etc., undermining the functioning of SA’s market economy, the sanctity of ownership, savings and investments.
Ironically, not even state property is secure. SA's state rail infrastructure has been vandalised by criminals and taxi mafias, who want to take over railway passengers, and truckers who want to take over rail goods transport – this capturing of state transport has contributed to the de-industrialisation of the country – meaning formal job losses, business closures and rising poverty.
Given the current collapse of the rule of law means the Expropriation Act will unleash unprecedented chaos, which will lead to even more unemployment and poverty for mostly black people.
The Expropriation Act is not necessary. The constitution already makes provision for expropriation of property for public interest, for which owners must be compensated. The Expropriation Act has very little to do with transformation but is purely populist.
The formulation of the law has been criticised since it was first mooted by the then majority governing ANC at its 2007 national elective conference. However, ANC leaders have stubbornly persisted with the Expropriation Act despite all the warnings before.
The initial bill was introduced in the previous ANC majority governmental term, before the coming into power of SA's current multiparty government of national unity (GNU) in 2024 but not signed into law. It was signed into law after the formation of the GNU.
The ANC's GNU partners objected to the law, as the ANC did not consult them and adopted the law unilaterally as if it were still the majority government, and not part of a new multiparty government, which should collaboratively come up with new policies.
Non-ANC GNU parties questioned why a bill that was put together by the previous ANC majority government should be adopted by an entirely new GNU – it should have been re-introduced to parliament, as it was a new government with new priorities.
I was head of the 2017 SA government commissioned team that reviewed SA's state-owned land and property holdings, and modelled an agency which can hold the country's state land and property. We recommended that surplus state land be made available to previously disadvantaged communities. Cabinet adopted the report in 2018.
Many ANC leaders, including President Cyril Ramaphosa, view the ANC as having lost votes on its left populist flank, to former ANC spin-offs, such as the EFF and MK Party. Within the ANC, opposition to the party's GNU with former multiparty charter members, such as the DA comes from the ANC's left populist factions. Ramaphosa, ostensibly to placate left populists within and outside the ANC, has introduced a number of populist policies, including the Expropriation Act.
The Expropriation Act has given left populists emotional, factional, and ideological satisfaction. It was also forced through to make up for government land reform failure because of corruption, incompetence, and failure of the rule of law – and are now trying to use the act to overcome that self-inflicted land reform failure.
For genuine land transformation, state land should be made available, communal land must be changed to individual title deeds, the failed state housing delivery programme must be resuscitated. Corruption, incompetence and toxic policies in the land reform public sector, state-owned entities and restitution programmes must be eliminated. Over 90% of all land restitution farms have failed for one or the other reason – meaning what were once thriving commercial farms have now been informalised.
They have failed either because productive land was given to workers or communities without any skills to commercially farm, or it was given to politically connected ANC leaders who have never farmed, or criminals forced the owners out, under the bogus restitution, often with the help of corrupt political and government land officials claiming land restitution.
State failure must be reversed and growth must be boosted through cancelling anti-growth policies such as the Expropriation Act. A middle way out for the ANC is to review the act or put it on hold until the courts pronounce on its constitutionality.