Expropriation bungle: Amid steep political division, constitutional amendment is adopted

15 Nov 2018

The first hurdle to expropriation without compensation was officially passed when Parliament’s constitutional review committee on Thursday adopted its final report in favour of changing Section 25 of the Constitution. That decision will provide the electioneering ticket for political parties ahead of the 2019 poll. But an actual constitutional amendment will emerge only well after the 2019 elections – and despite the political and procedural pressure to get things right, the recommendations have been bungled.

That expropriation without compensation was a done deal was obvious from Tuesday when the joint constitutional review committee started deliberations on a final report. The fault lines ran, as they have all along in this nine-month process. The ANC and EFF on the one side for compensationless expropriation, now also supported by the United Democratic Movement (UDM) and the National Freedom Party (NFP), and just about all other opposition parties on the other, against.

That meant the numbers were down for a constitutional amendment. And Thursday’s committee vote played out according to these fault lines: 12 MPs showed hands for recommending a change to Section 25 of the Constitution, dubbed the property clause, and four against. And so the 17-page report was officially adopted, the first step in a significantly long journey yet to a change in the Constitution.

Outlining the nine-month process, including 34 public hearings in towns across South Africa, some 600,000 written submissions, oral presentations by over 50 organisations representing banks, civil society, farmers and others in two rounds in Parliament, the nitty-gritty of the report is in the so-called final recommendations.

And that’s where the bungling comes in.

“Parliament must table, process and pass a Constitutional Amendment Bill before the end of the 5^th democratic Parliament in order to allow for expropriation without compensation,” say the recommendations.

It’s straight from the EFF playbook. The party has repeatedly publicly said this should be in place before the 2019 elections as it claimed credit for driving this public debate.

And the EFF did so again in its statement on Thursday.

“The constitutional review committee has also taken a resolution that a Constitutional Amendment Bill must be tabled and passed before the end of the 5th Democratic Parliament. Long has this country waited for a decisive generation, who will consolidate the decolonisation process with regards to the land. With the arrival of the EFF, this was attained in less than five years.”

But it’s unrealistic. No election date has yet been set, but President Cyril Ramaphosa at a public gathering in September let slip that the elections would be before the end of May 2019. Parliament rises in early December, and returns in early February, the month that is traditionally taken up by the State of the Nation Address (SONA) and the Budget.

Constitutional amendments include notice periods of 30 days as set out in Section 74 of the Constitution, alongside public hearings, parliamentary deliberations and related legislative processes that include a law of general application. In this case that’s the Expropriation Bill which should dovetail the constitutional amendment so the constitutional change can be effected in legislation. Public Works is expected to release an Expropriation Bill for public comment by year-end.

It’s not quite clear how this time frame recommendation remained in the report the committee adopted on Thursday. Clearly not all the i’s were dotted and t’s crossed, but then both the ANC and EFF, each for their own reasons, are under pressure to show progress.

The ANC at its media briefing on Thursday focused on opposition gripes about committee procedures and the possibility of legal action, and parliamentary processes to unfold.

“The process of actually amending the Constitution is not going to happen until after the elections,” said ANC MP Vincent Smith.

When asked about the recommendation that the process would be concluded before the current Parliament dissolves just ahead of the 2019 elections, linguistic slips were blamed.

The ANC maintained it was not possible to change the Constitution before the 2019 elections and that recommendation in the report would be changed and “tightened up” before it is in the House toward the end of November. Or that the structure, the “mechanism” in the recommendations, that must drive this constitutional process may simply hand over to the incoming post-2019 election parliamentarians.

It’s all fudging in a process that can ill afford it. Only the committee which adopted the report and recommendations can change it. And leaving its to the still-to-be established structure to process the constitutional amendment is simply playing kick for touch over a blunder that the process where politicking seems to be trumping policy could ill afford.

Expropriation without compensation has been among the top questions by investors – this emerged when Nedbank CEO Mike Brown testified before the committee in September – and has followed Ramaphosa around on his overseas official visits, including this week to Belgium.

Intellidex analyst Peter Attard Montalto in a recent brief argued that while land reform overall would be “a strong long-term positive… if it can be executed through a capable, capacitated and clean state”, those conditions in government did not exist at present and may not for some time. In this context, he argued, expropriation without compensation was “potentially growth dampening” political short-term play, particularly as there have been no additional budgets set aside to support land reform.

“The existence or lack of a constitution and rule-of-law-based property rights framework, delivered by a well capacitated government framework, is an excellent long-run predictor of gross domestic product (GDP) per capita.”

On Thursday the sharp political divisions of this compensationless expropriation were on display when an opposition front of the DA, Cope, African Christian Democratic Party (ACDP) and Freedom Front Plus said the ANC and EFF had pushed though a decision that was not necessary.

“South Africa does not have a constitutional problem, we have an ANC problem,” said DA MP Thandeka Mbabama at the joint media briefing.

“The Constitution is not the barrier to land reform, but corruption, constrained budgets and a lack of political will on the part of the ruling ANC have contributed to the delays in land redistribution process.”

All options were being considered, including legal routes that are also being mulled by organisations like AgriSA, the Institute for Race Relations and Solidarity.

The IFP in a separate statement said it was disappointed that an “unfinished” report had been rushed through.

“It is wholly untrue that those who are opposed to the amendment of Section 25 of the Constitution are against land reform, said IFP MP Elphas Buthelezi.

“(L)and must be expropriated, but with reasonable compensation and with improved government policies to speed up land reform and redistribution processes.”

The report of the joint constitutional review committee as adopted on Thursday recommended:

“That Section 25 of the Constitution must be amended to make explicit that which is implicit in the Constitution with regards to expropriation of land without compensation, as a legitimate option for land reform, so as to address the historic wrongs caused by the arbitrary dispossession o land and in so doing ensure equitable access to land and further empower the majority of South Africans to be productive participants in ownership, food security and agricultural reform programmes.”

The report also recommended: “That Parliament must urgently establish a mechanism to effect the necessary amendment to the relevant part of Section 25 of the Constitution.”

That’s the next step after the committee report is debated, and will no doubt be voted on, in both the National Assembly and National Council of Provinces (NCOP). That is set to happen in the National Assembly by month’s end and also in the NCOP before Parliament rises in early December.

And because the ANC and EFF, bolstered by the UDM and NFP, have the numbers – the report adoption requires a simple majority in the House – there is no doubt this report will be adopted.

But another motion is required to establish that “mechanism” that would ultimately draft the constitutional amendment. Such a motion could establish an ad hoc committee set up specifically for this task – the committee is unlikely to do the actual drafting itself, but rely on Parliament’s own legal drafters – or this motion might simply refer the process to the justice committee.

The way this recommendation is drafted indicates that Parliament would want to remain firmly in charge of drafting. That is unusual as previous constitutional amendments – there have been 17 to date – have been drafted by the Justice Department. But going that route would mean sticking to the executive’s protocols: departmental public hearings, refining of draft Bill, submission to Cabinet – a process that rarely takes at least a month and more likely on average three months – before a constitutional amendment Bill would get to Parliament for the start of the actual legislative process.

While completing a constitutional amendment before the 2019 elections is unrealistic, establishing this structure and getting it to work is doable.

And both the ANC and EFF would want to take something more concrete than a committee decision, as adopted in the House, into 2019 when both are expected to launch their election manifestos. There’s much more electioneering mileage in talking of the process under way to amend the Constitution.

The first hurdle on the road to compensationless expropriation was passed on Thursday, but the road is still long – and full of political potholes. DM

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