EFF vs ANC on land expropriation without compensation: Who will prevail? IRR’s Terence Corrigan

Institute of Race Relations Terence Corrigan sits down with BizNews founder Alec Hogg to dissect expropriation without compensation (EWC) as the EFF has backtracked in its support to amend Section 25 of the constitution. The ANC needs the EFF’s support for enough votes to rack up a two-thirds majority. The ANC says it will now fight this battle alone. Terence has been fighting against EWC for years and his in depth understanding of the topic makes for fascinating insights, a topic that all South Africans have a vested interest in. – Justin Rowe-Roberts

Terence Corrigan on his fight against expropriation without compensation (EWC): 

I think that the question of property rights is one of the great unresolved issues of the transition. And when I was at the Institute of International Affairs, one of my colleagues said to me there that there is no society in history that has been sustainably developed without secure property rights. That stayed with me. I’m very happy to have invested the last couple of years – a couple years of my life making this point here and around the world.

On the EFF backtracking on its support of expropriation without compensation and the two-thirds majority required by the ANC to amend Section 25 of the Constitution:

This all comes down to the word custodianship. The EFF since the very beginning of this round and there have been previous attempts to introduce an EWC, or EWC like regime into the country. But if you go back to January or February 2018 when the parliamentary inquiry into whether it was necessary to amend the Constitution was introduced, the EFF’s original motion was very clear that Section 25 makes land reform etc impossible, and the state must be the custodian of all land. Call this nationalisation. There was a constitutional court judgment which kind of split hairs and said ‘Well, the states are not really owning it, it’s kind of holding it’. I think for practical purposes, essentially what you end up with is nationalisation. That was the EFF’s position.

The ANC’s position I think was actually quite sympathetic to this. But the ANC is a bigger and less coherent organisation than the EFF. I think that while there is a great deal of sympathy in the ANC for an effective nationalisation of land – someone like the deputy finance minister wrote an article that this is imperative, that land must be held by the state. It’s been put forward in ANC’s documents, it has been put forward in state documents. The 2017 land audit, for instance, called for the same thing. What the ANC probably is cognisant is the following – that most of its supporters do not like this idea. This is a highly ideological viewpoint. It draws from various strands, partly from let’s say the communist agenda. But then also the idea of the of the mighty developmental state, which has been in development supposedly for 25 years.

As a foreign investor, whether the bill that is on the table makes South Africa more or less attractive as an investment destination: 

If you’re talking about the constitutional amendment bill, that attracts a lot of attention. Its main impact really is that it alters the prospects of a constitutional challenge. That I don’t think is going to be essential for foreign investors. What is going to be of far greater interest is the expropriation bill, because whereas the constitutional amendment simply redefines your rights – it doesn’t necessarily set up a new system of administration or anything like that. So we would need to see exactly what happens with the expropriation bill before that would become something you can make a firm decision on.

If I was a foreign investor, I would want to actually know what this means. Bromides and platitudes from the president at an investment conference don’t cut it. If you do not intend custodianship, why do you put this phrase in the constitutional amendment? I mean, that’s an obvious one. And if indeed your plan is to give ownership and title deeds, as the minister was saying in the Sunday Times – well, why are you not doing that? It is government policy not to issue title deeds to people who receive redistributed land. That’s not conspiracy.

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