Compensation for land
http://www.thezimbabwean.co.uk
In an important piece in the on-going Sokwanele debate on land entitled “The
significance of land compensation for rehabilitation of Zimbabwe’s land
sector”, Professor Mandi Rukuni, former chair of the Zimbabwe Land Tenure
Commission and professor of agricultural economics at UZ, offers his
thoughts on the compensation issue. As ever it is a measured, pragmatic
stance and one with much merit. He makes a number of key points and
13.11.12
by IAN SCOONES
He points out that existing legislation (from 2000) allows for compensation
for ‘improvements’ only. This has been confirmed in the still-disputed draft
Constitution, suggesting at least that the MDC agrees with this formula,
although the Constitution allows for full compensation including for land
for those farms governed by investment treaties. Around 125 farmers settled
on this basis in the early 2000s before hyperinflation kicked in. Now others
are contemplating this, among the former owners of the 1250 farms that have
been surveyed and valued. Thus since the Fast Track programme, 210 farmers
have been compensated for improvements. Compensation values which have been
paid out vary from about $200,000 to $1.2 million, according to Rukuni.
But what would the total cost? In order for the agricultural economy to move
forward and for investment to flow, with confidence once again being
restored, dealing with the compensation issue is a priority. Under the
existing law, compensation and so ‘quittance’ must precede the issuing of
any new lease. Without compensation then, especially for the larger A2
farms, lease arrangements are impossible, resulting in continued insecurity
for existing farmers.
According to government, the total settlement bill on this current basis
would be US$1.5-2 billion. However, the Commercial Farmers’ Union disputes
the legislation, arguing that compensation values should include land,
improvements, interest and consequential damage. They estimate the total
would come to between $6 and $10 billion. Clearly there is a big gap between
the estimates. What then is a pragmatic solution? The fact that the
government is serious about compensation is clear from the budget
allocations up to 2014, over which period some $30 million has been
earmarked for compensation. This is clearly not enough, and other support,
including from the international community will be required, to resolve
this. So, what else needs to be done?
Rukuni identifies two things for immediate action. First, valuations must be
speeded up. Currently over 5000 properties still need to be properly valued,
and if valuations are disputed, they must be dealt with in the
Administrative Court. Second, a Land Acquisition Compensation Fund needs to
be set up to allow swift and complete payment of all compensation. The fund
would be made up of contributions from the national budget, contributions
from international donors and development banks, and from transfer fees and
ground rents from A2 farmers once leases were issued.
Above all, Rukuni argues for a pragmatic and flexible process. While there
are some who will stick out for a full settlement and will continue to
pursue this in any court that will hear them, there are many others –
perhaps the majority – who want an end to the uncertainty. For many the
economic collapse, as well as the loss of their farm assets, has resulted in
severe hardships, very often in a vulnerable period of retirement, given the
age profile of most former white farmers.
Rukuni comments, showing his frustration with all sides: “…frankly the
country needs a more proactive leadership from both government and organized
farmers on this matter. It is better for government and farmers to face
donors with a negotiated position than the current huge gulf in positions”.
In other words, he suggests, until there is a sense of joint movement on
this donors, whose budgets are being squeezed in any case are unlikely to
touch the politically charged prospect of compensating a few thousand white
former farmers, prioritizing them above other perhaps more pressing
humanitarian and development needs in the country.
Yet for the country to move forward some compensation deal, at least for the
majority, is essential. This must emerge from a national consensus, driven
jointly by former farmers and the inclusive government. This must represent
a reasonable, not a maximum, claim, more likely in the ballpark of the
government’s estimate. My personal view, expressed in an earlier blog, is
that, rather than expecting the constrained national budget and aid budgets
to bankroll this, any compensation settlement must be wrapped up in a deal
around national debt. Yet sadly on this too, there remains little consensus.
So, while the administrative and legal mechanisms for resolution exist, the
political commitment from key players must be there too. Sadly, this may
still be something that has to wait until a new political settlement is
reached, hopefully in the next year, with a new agreed Constitution being
the basis for moving forward on this thorny consequence of the land reform.