White Paper

4 LAND REFORM PROGRAMMES

4.1 The three sub-programmes

The government's land reform programme is made up of the following principal sub-programmes: Land Redistribution, Land Restitution and Land Tenure Reform.

Land Redistribution makes it possible for poor and disadvantaged people to buy land with the help of a Settlement/Land Acquisition Grant. Land Restitution involves returning land, or compensating victims for land rights, lost because of racially discriminatory laws, passed since 19 June 1913. Land Tenure Reform is the most complex area of land reform. It aims to bring all people occupying land under a unitary legally validated system of landholding. It will provide for secure forms of land tenure, help resolve tenure disputes and make awards to provide people with secure tenure.

4.2 Legal mechanisms

The Land Reform Programme will be implemented through the legal mechanisms listed in Box 4.1 and an ongoing legislative programme.

 

Land Redistribution

4.3 Purpose

The purpose of the land redistribution programme is to provide the poor with access to land for residential and productive uses, in order to improve their income and quality of life. The programme aims to assist the poor, labour tenants, farm workers, women, as well as emergent farmers. Redistributive land reform will be largely based on willing-buyer willing-seller arrangements. Government will assist in the purchase of land, but will in general not be the buyer or owner. Rather it will make land acquisition grants available and will support and finance the required planning process. In many cases, communities are expected to pool their resources to negotiate, buy and jointly hold land under a formal title deed. Opportunities are also offered for individuals to access the grant for land acquisition. The land distribution strategy is shown in Box 4.2.

4.4 Government's approach

The government's approach, as set out in this White Paper, involves a single, yet flexible, redistribution mechanism which can embrace a very wide range of land reform beneficiaries including the very poor, labour tenants, farm workers, women, individuals and new entrants to agriculture. The mechanism can be adapted to ongoing circumstances. It depends largely upon voluntary transactions between willing-buyers and willing-sellers, which should result in dispersed land acquisition and settlement, as against block settlement in designated areas. Expropriation will be used as an instrument of last resort where urgent land needs cannot be met, for various reasons, through voluntary market transactions.

The challenge for government has been to devise and implement a programme which responds even-handedly to each segment of the land market in order to provide access to the range of clients seeking to obtain land: from the poorest, especially female-headed, single parent families to emergent black entrepreneurs. The programme also needs to accommodate different land uses.

Rather than allocate different levels of resources to different beneficiary groups, all eligible applicants are provided with the same level of state support in terms of the level of grant awarded. While seeking to give priority to groups of poor households, government also recognises the importance of encouraging individual enterprise and initiative.

4.5 Rural finance

The Ministry for Agriculture and Land Affairs accepts its unequivocal responsibility to create an enabling environment with regard to financial services for land reform beneficiaries. The measures that are being taken to establish such an environment draw substantially on the conclusions of the Presidential Commission of Enquiry into Rural Financial Services (the Strauss Commission). The key recommendations of the Commission are reflected below.

4.5.1 The need for small, timeous and efficient dispensing

Equally, the challenge to rural financial institutions is to be able to make smaller quantities of working capital available efficiently without incurring overwhelming transaction costs. So far NGOs have made the best provision of critical small loans (R300 to R3 000) with women as their most successful and enduring clients.

4.5.2 Information needs

Information is a critical need in rural areas. The Strauss Commission found that the non-availability of information was a critical impediment to rural development at different levels. In some cases, it is difficult to pass on information in rural areas. This is especially the case with farm workers. In other cases, the state functionaries themselves have not been fully aware of state policy.

It is imperative that the state finance information flows to rural areas. There are two important proposals in this regard. The first proposal envisages a dynamic developmental role for the Post Office wherein it would be a centre in rural areas providing information on government grants, financial packages and the roles of different parastatal and private sector financial institutions. The second proposal envisages the state making funding available for the employment of information agents by rural organisations.

4.5.3 Support for outreach

The web of formal financial institutions thins out dramatically as it spreads from rural service towns deeper into the rural areas which are less populated and less well served with infrastructure.

The Strauss Commission proposed that the state should take responsibility to foster a greater number of rural financial institutions such as NGOs, community banks and village banks as well as make existing resources work more effectively, for example develop the delivery potential of the Post Office and create incentives for private sector banks. It was suggested that NGOs should benefit from increased state support and that donor funding attracted by NGOs should merit the award of matching grants.

4.5.4 The private sector and agency agreements

One incentive for the private sector to engage more fully would be for the proposed financial package to be available to them and not only to parastatals and NGOs. It is also suggested that the greater use of agency agreements be vigorously pursued; NGOs, for example, find the physical administration of loan repayments can be costly because of time and distance - using the Post Office to administer repayment would solve this stumbling block. Similarly the Post Office does not have loan agents and yet its institutional effectiveness will be limited if it continues a savings only policy. Agency agreements may provide the answer to this issue

4.5.5 The role of parastatals

The Strauss Commission recommended that state responsibility to co-ordinate the provision of a balanced range of trustworthy financial services, especially in the context of land and agricultural finance, would be through the appointment of a commercially oriented parastatal institution to champion the cause of rural communities.

It was therefore duly recommended that the Land and Agricultural Bank be suitably transformed to provide both land acquisition mortgage finance as well as finance for agriculturally related activities. The current network of the Land and Agricultural Bank would need to be both rationalised and extended to serve the new clientele. The network could also be extended through the use of agency agreements and one would expect a close working relationship with the Post Office to occur.

4.5.6 A cautious approach to subsidised credit

Land Reform beneficiaries have expected the government to come up with subsidised finance, especially interest rate subsidies, as this form of support was commonly made to farmers by past governments.

However, apart from placing a strain on the state fiscus, subsidised interest rates for land purchase increase the demand for land and hence increase the market price for land, without increasing its productive worth. Hence a subsidy on interest rates results in higher land prices and rates of indebtedness and this outcome is not desirable. The Strauss Commission clearly proposed that interest rate subsidies for land acquisition should not be considered.

The Strauss Commission however did not entirely reject the use of subsidies. It, for example, proposed that in the interest of getting more institutions to operate in rural areas, subsidies be used to finance the higher transaction costs of institutions delivering finance. It also proposed a set of guiding principles to be used for the design of any other subsidies that government might consider to be necessary, ie transparent, defined, targeted with clear policy objectives and for a limited period.

4.5.7 A state-supported financial package for land reform beneficiaries

There are two aspects to the state assisting in creating an enabling environment for land reform beneficiaries. The first is to assist with the flow of funds into a new market, which is weak, and in which the private sector may not be easily willing to risk their funds. The second possible area of support from the state is to assist land reform beneficiaries and entrepreneurs to get on their feet through training and through offering a set of conditions which assists them, especially in the first few years of establishing their business. The Strauss Commission, responding to these two considerations recommended (i) the state funding of a risk-sharing agreement and (ii) a set of `sunrise' subsidies. The Department of Agriculture is ultimately responsible for taking forward the proposals, if accepted, and in acquiring and distributing the state budget required to implement the proposals through the financial institutions.

4.5.8 A risk-sharing agreement

Both parastatals and private sector financial institutions are profit-oriented and have a reluctance to lend to higher risk clients - the beneficiaries of land reform are likely to be placed in this category.

The intention of a risk-sharing agreement, successfully pursued in other countries, is that the state provides a fund which acts as both an incentive and a safety net to financial institutions which begin to lend to a newly targeted clientele. The state undertakes to underwrite a percentage of the loan in the event of non-repayment. The Strauss Commission proposed the order of 80:20, as this has worked successfully in other countries, but this is subject to negotiation. The principle of the risk share is that the risk should be large enough (20 %) to ensure that lenders will behave rigorously, but also small enough that the risk of losing is not too great a disincentive.

4.5.9 `Sunrise' subsidies

The Strauss Commission proposed that the following financial `sunrise' subsidies be considered to support land reform beneficiaries: a graded entry to repayment, a flexible repayment system, a discount subsidy.

 

4.6 Valuation of land

Where state funds are used to subsidise the purchase of private land, the DLA and the Department of State Expenditure require that a fair price be paid. This will usually be 'reasonable market value'. This is defined as a price which is comparable with recent sales in the locality and one which is endorsed by an independent valuer and/or the Land and Agricultural Bank. A valuation based on market value must capture location-specific factors such as proximity to settlements and the risk of land invasion or stock theft. This is, however, qualified by the factors set out in the compensation formula prescribed by the Constitution for expropriation.

Expropriation will be considered in situations where there is no reasonable alternative land and the owner either will not sell, or will not negotiate a fair price. In considering what is a fair price, regard must be had to the compensation formula set out in the Bill of Rights. Section 25(3) of the Constitution states:

The amount of the compensation and the time and manner of payment must be just and equitable, reflecting an equitable balance between the public interest and the interests of those affected, having regard to all relevant circumstances, including -

(a) the current use of the property;

(b) the history of the acquisition and use of the property;

(c) the market value of the property;

(d) the extent of direct state investment and subsidy in the acquisition and beneficial capital improvement of the property; and

(e) the purpose of the expropriation.

4.6.1 The role of government in valuation

The role of government in the land valuation process is that of a facilitator, provider of information and a guardian of the principles set out above. Government has a responsibility to ensure that state resources are wisely used and that prices negotiated are just and equitable. The Department of Land Affairs is therefore required to appraise all land transactions concluded under the Land Reform Programme.

Government will endeavour to ensure that would-be buyers negotiate directly with would-be sellers in setting the price of a piece of land to be acquired. As facilitator, the Department of Land Affairs, or its appointed agents, has an obligation to explain clearly to grant applicants the rules with regard to valuation:

The cost of land valuation must be paid from the Settlement Planning Grant. The Department will provide guidance on acceptable fees for valuations. It may also pay for communities to hire a negotiator to assist them in the process of purchase. This will enable government to remain at arm's length, while at the same time strengthening grantees' capacity to achieve the best price.

In the case of valuations to determine compensation in expropriation cases, the work is carried out by the Land Affairs Board of the Department of Public Works. Procedures for the valuation of state land are discussed in Section 5.8.3.

4.7 Grants and services

Under the programme, the government provides a number of grants and services. To varying degrees and in different ways, the grants and services are applicable to the three land reform programmes: Restitution, Redistribution and Tenure Reform. Details on these grants are given in Sections 4.21 B 4.26 of the White Paper. They are summarised in Box 4.3.

The primary source of direct financial assistance to potential beneficiaries will be the Settlement/Land Acquisition Grant. Of critical importance is the fact that the grant will be used as flexibly as possible. The grant is set at a modest level and is in line with the grant administered by the Department of Housing, intended to assist in providing minimum shelter conditions for first-time house owners. Similarly the Settlement/Land Acquisition Grant is intended to provide a modest dwelling and/or a productive land ownership opportunity.

The grant is currently set at R15 000. It is an umbrella one in the sense that any government assistance for either land purchase or basic needs provision will be debited against the R15 000 per household maximum subsidy. The allocation of the grant will be registered on the same national data base as the National Housing Subsidy. A household may apply for both, and in any order, but cannot qualify for more than R15 000. This flexible application of the grant acknowledges the links between rural and urban households, and places responsibility on the beneficiary to choose when and how to apply the once-off subsidy.

It is expected that the majority of beneficiaries of the Settlement/Land Acquisition Grant will be the rural poor. Special emphasis will be placed on targeting women. Many of these poor are resident on farms; some may be farm workers, others are unemployed. These potential beneficiaries may have a preference for a land acquisition opportunity within the area where they have family, and possibly tribal ties. There are also considerable numbers of landless persons who are former farm workers, and on being made redundant, have clustered on the periphery of rural towns. It can also be expected that people resident in former homeland areas will be looking forward to an opportunity to access additional land or to use the grant to secure their tenure

(see Box 4.4 for potential uses of the grant).

The level at which the grant is set and the means by which it is accessed have meant that the majority of land reform beneficiaries have formed themselves into groups to access land collectively. The Department of Land Affairs is aware that there are many potential beneficiaries who would like to access land individually or as an individual family. Work is being undertaken to establish simple procedures to allow individuals to access the Settlement/Land Acquisition Grant in order to meet their land needs. Measures being examined include expedited subdivision of land to encourage individual or family smallholder ownership.

 

4.7.1 Priority criteria

Redistribution projects will be ranked in priority order according to the following criteria:

4.8 Urban land redistribution

Across the country, urban areas are struggling to cope with increases in the scale and rate of increase in homelessness and landlessness. This increase has far overtaken the rate at which housing can be provided at present. The problem is exacerbated by the insecure tenure that characterises many informal settlements.

The DLA appreciates the pressing and serious nature of urban landlessness. However, its role has to be played within the context of a multi-sectoral urban development programme and it is necessarily confined to the delivery of land and secure tenure through the development of an appropriate enabling policy and legislative framework.

The urban land reform programme thus has two elements. The first is directed towards measures that will result in the alleviation of landlessness through the provision of land. Here the DLA has been piloting a programme with the Gauteng Provincial Government. It involves using part of the Settlement/Land Acquisition Grant to buy land as a first tranche of the subsidy (see Box 4.5). If successful, it is anticipated that it will be replicated elsewhere.

The second element is the delivery of secure tenure to people in the places where they presently reside. Programmes to identify and describe land parcels, and to register land rights are the key elements of this and are discussed more fully in the Land Tenure section of this White Paper.

The measures in the Development Facilitation Act that provide for the rapid release of land for development, as well as for the initial registration of tenure in such a way that subsidy money will flow at an early stage in the process, have the potential to ease considerably the pressures on the delivery process.

4.8.1 An adequate response to land invasions

The instability, conflict and uncertainty in relation to property rights that is caused by land invasions has been discussed in Section 3.15.2. Land invasions are increasing in the absence of suitable land being identified and assembled for affordable housing. They hamper efforts to release land in a planned manner and result in 'queue jumping' for the housing subsidy and for land. Government, while strongly discouraging land invasions, does not believe that the only solution lies in evictions, which are often a route towards confrontation and civil disturbance. Evictions as a solution to land invasions are a measure of last resort and should only be considered after all other possible alternative solutions have been explored, including commitments to organised groups of landless people for the delivery of land within specific time frames. Where evictions are the course of action decided upon, this should only be after due process has been followed.

In the final analysis it is the delivery of appropriate land at a rapid pace that is the solution to land invasions.

From both a cost perspective, and from the need to minimise conflict and stabilise communities, it is preferable, that where it is possible and appropriate, in situ upgrading of tenure and regularisation of land rights is seen as a solution to land invasions. In particular, the upgrading of tenure in these situations, may provide individual households with sufficient security and ownership to give them independence from 'warlords' seeking to extract rent from them in return for land.

This position does not in any way imply governmental support for land invasion as a means of acquiring land. Government maintains its right to take legal action against land invaders. It is also determined that land invasions or threats of land invasion will not be rewarded with special treatment.

Finally, the high cost of urban land in well-located areas, relative to available subsidies, makes an investigation of urban land prices and the means to make the expenditure of subsidy funds most effective, an essential step. The DLA is currently investigating mechanisms for the financing and release of better located land in urban areas for settlement by the poor.

 

4.9 Access to land and tenure security for farm workers

There are about 1,2 million farm worker households in South Africa. They constitute one of the poorest and most insecure sections of our population. The channelling of settlement grants to farm workers is problematic because their housing is tied to employment. Termination of employment results in loss of housing and any benefit provided by government. In the past, subsidies were provided to the farm owner for farm worker housing. Government now wishes to direct the subsidy to the farm workers and their families in a way which would improve tenure security and at the same time contribute to a more equitable ownership of land and to reconciliation and harmony.

The Settlement/Land Acquisition Grant can be used in a number of ways to achieve these aims, in diverse situations. There are two main settlement options for farm workers.

4.9.1 Off-farm settlement options

These entail the purchase of land and establishment of housing and service infrastructure close to existing farm employment and other employment opportunities. Such options would be more viable where a number of farm workers apply as a group for assistance to establish an 'agri-village'. Another option is settlement in nearby towns, in which case the workers concerned would be eligible to apply to the Provincial Housing Board for a housing subsidy. There are also instances where farmers and farm workers negotiate an arrangement in which a part of the farm is sub-divided.

4.9.2 On-farm settlement options

Settlement options range from schemes in which agreements between the parties cover investment in farm worker housing and amenities only, to schemes in which investment includes equity shares in the farming enterprise as a whole. Several innovative schemes are being piloted by land owners and their employees. The feasibility of others is being studied. Options include:

(a) A contractual agreement between the state, farm worker and the farm owner, in which the farm worker and his/her family use the grant to enhance the housing stock and/or non-bulk service provision on the farmer's land, subject to the right of occupancy for the farm worker and his/her family.

The agreement should also ensure that the farm worker will be financially compensated by the owner for any improvements effected by the farm worker, in terms of own investment and as a beneficiary of the grant, should the occupancy be terminated; and that the funds would be reinvested to provide for alternative settlement opportunities.

(b) An equity share-holding arrangement between the farm worker and the farm owner whereby the value of the grant which is invested in the farm enterprise is held as an equity share by the farm worker.

In these equity schemes, farm workers obtain part ownership of a farm on which they work, thereby sharing in its capital growth, profits and risks. Where government grants are involved, the state needs to be reassured that the investment of public funds is justified and that the interests of the intended beneficiaries - the farm workers - are adequately safeguarded. The state needs to be assured that government grants are adequately matched by funds provided by the farm owner. Such schemes must pass the acid test, namely that they significantly improve the security of tenure of the farm-worker, contribute to land redistribution, reconciliation and harmony.

4.9.3 Partnerships with the private sector

Private sector initiatives in land reform are partnerships/agreements between recipients of the Settlement/Land Acquisition Grant and owners of private businesses, which broaden the base of land ownership, offer security of tenure and raise incomes of the grantees. The Department of Land Affairs, together with organised agriculture, believes that successful partnerships should be actively developed. The Department supports initiatives which have the potential to widen the scope and efficiency of the land reform process, and promote the sharing of risks and responsibilities. Recipients can use their grant to purchase a share in the land and the infrastructure that is critical for the productive use of the land. Such cooperative arrangements can greatly improve farm production and the income of the partners.

Qualifying schemes have to be land based and involve the immediate provision of tenure security for the grantees. Enhanced security of tenure is the principal criterion and has to be part of the written agreement between the Department, the grantees and other participants. The Settlement/Land Acquisition Grant must be used for acquiring land and productive assets.

Box 4.6 summarises some initiatives proposed by the private sector. Some of these are presently being piloted. Clear lines between eligible and ineligible schemes cannot be easily specified in advance. Each partnership proposal will be assessed on its merits. The Department is committed to playing a direct and active role in leveraging financial resources to increase the financial and economic viability of land reform. Provincial Directors have authority to follow up initiatives, accessing specialist advice where and when necessary to support farm workers and landowners to prepare partnership agreements. A private sector help desk has also been established in the DLA Head Office, Pretoria.

4.10 Labour tenants

As labour tenants are a specific category of rural dwellers who are particularly vulnerable, with specific land needs, the Land Reform (Labour Tenants) Act, 3 of 1996, was passed by Parliament. The Act was retrospective which means that all labour tenants are protected by this Act as of 2 June 1995. The objectives of the Act are twofold. On the one hand, the Act provides for the protection of the existing rights of labour tenants. On the other hand, it makes provision for the acquisition of land for existing labour tenants who will be able to access the Settlement/Land Acquisition Grant for this purpose. The Act applies only to Labour Tenants as defined by the Act and excludes other categories of rural land dwellers, such as farm workers, tenants on farms or persons who would have qualified as labour tenants were it not for the fact that they unilaterally ended their labour contract with the farm owner.

Chapter 2 of the Act provides for protective tenure for labour. Tenants cannot be evicted simply because the owner decides to give them notice, but only when they have breached the contract or are guilty of misconduct, or the owner has very specific needs for land. In the event of eviction, the process has to follow particular procedures. Only the Land Claims Court can order the eviction of a labour tenant. Magistrates are obliged to refer eviction applications to this court if the evictee can establish that he/she falls under the Act.

Chapter 3 of the Act deals with the right of labour tenants to acquire the land which they occupy, or use. This section of the Act aims to promote negotiations between the parties at a local level to reach a settlement. In the case of failure to reach agreement, the matter will be referred to arbitration via the President of the Land Claims Court. This will necessitate the establishment of a panel of arbitrators by the Minister for Agriculture and Land Affairs in consultation with the Minister of Justice.

4.11 Addressing gender equality

It is essential that gender equity be ensured in the land redistribution and land reform programme so that women achieve a fair and equitable benefit. This requires the following:

All of the above points refer not only to redistribution but are also applicable to the Land Restitution and Tenure Reform programmes. A Women's Rights in Land sub-directorate has recently been established in the Department. It is responsible for ensuring that all the Department's policies and programmes properly fulfil the requirement for gender equity.

4.12 Local government commonage

In large parts of the country, in small rural towns and settlements, poor people need to gain access to grazing land and small arable/garden areas in order to supplement their income and to enhance household food security. The Department of Land Affairs will encourage local authorities to develop the conditions which will enable poor residents to access existing commonage, currently used for other purposes. Further, the Department will provide funds to enable resource-poor municipalities to acquire additional land for this purpose.

4.12.1 Policy and legislative environment

Legislative competence for municipal commonage rests with provincial and municipal authorities, some of whom are already engaged in initiatives to support poor residents in gaining access to this land. The Department will offer assistance for the development of appropriate provincial policy, legislative frameworks and administrative systems for the maintenance and use of municipal commonages for land reform purposes, if so requested by provincial or local government. Support will be given to municipalities requiring assistance to determine how to regulate the relationship (using by-laws and/or by private agreement) between the user group, themselves and legal authorities. Examples of management plans between users and a local authority are available.

The Department of Land Affairs has been informed of a number of situations where commonages are not being used for the public purposes set out in the title deeds to the land, and where there is a demand for the land by poor people within the community. This has raised the question of whether this land should be requisitioned for its original purposes. The Department of Land Affairs is at present considering this.

In addition, consideration is being given to the possibility of buying out existing leases (that were signed prior to the local government elections) under the following conditions: if there is a desperate and urgent need for access to the commonage which cannot wait until the lease expires; the lessee is willing to be bought out; and where the municipality concerned has no financial resources to enable it to do this itself.

4.12.2 Grant for the Acquisition of Land for Municipal Commonage

The Department of Land Affairs will offer a Land Acquisition Grant to primary tier local authorities to enable them to buy land to create or extend a commonage for use by poor and disadvantaged residents for agricultural purposes. An application should be made by the Local Authority which must include information about the intended beneficiaries.

The Land Acquisition Grant will be disbursed by a provincially-based committee convened by the DLA provincial office, in consultation with the relevant provincial department responsible for administering the Municipal/Local Authority Ordinance governing the commonage.

The amount of the grant in each case will be determined by the DLA provincial office, taking into account the availability of funds and the principles of fairness and equity. Details of this grant are given in Section 4.24.

Land Restitution

4.13 Purpose

The goal of the restitution policy is to restore land and provide other restitutionary remedies to people dispossessed by racially discriminatory legislation and price, in such a way as to provide support to the vital process of reconciliation, reconstruction and development. Restitution is an integral part of the broader land reform programme and closely linked to the need for the redistribution of land and tenure reform. The Restitution of Land Rights Act, 22 of 1994, and the Constitution provide a legal framework for the resolution of land claims against the state, where possible through negotiated settlements. The Land Claims Court is responsible for adjudicating claims. The government has set itself the following targets:

Experience locally and internationally has shown that the finalisation of claims and implementation of restitution awards can be a difficult and very lengthy process. Progress will therefore be evaluated periodically, and it may be necessary to review time frames and develop measures to address any delays which may occur.

4.14 Government's approach

4.14.1 Justice and equity

In developing an appropriate approach to restitution claims, it is important to identify the different ways in which people have been prejudiced through dispossession. In this regard a broad distinction can be made between the following:

Restitution policy is guided by the principles of fairness and justice. At the heart of this is the recognition that solutions must not be forced on people. The restitution process is driven by the just demands of claimants who have been dispossessed. They have a right to restitution in one form or another. The Department and the Commission will encourage claimants and others to come together to resolve claims. Where this cannot be achieved, the Land Claims Court will decide the case in accordance with the provisions of the Constitution and the Act.

The principles of fairness and justice also require a restitution policy that considers the broader development interests of the country and ensures that limited state resources are used in a responsible manner. To be successful, restitution needs to support, and be supported by, the reconstruction and development process.

The parameters of the restitution process are determined by the Constitution and the Restitution of Land Rights Act. Further policy is being formulated on the basis of these parameters. For the purpose of the White Paper, the following areas of policy are elaborated on: qualification criteria, forms of restitution, compensation, and urban claims.

4.14.2 Qualification criteria

The Constitution and the Restitution of Land Rights Act create a right for certain dispossessed people to claim restitution. Claimants should apply to the Commission on Restitution of Land Rights before 1 May 1998. The Commission will deal with those claims which qualify for investigation.

Since the start of the Commission's work, over 14 000 cases have been lodged, but only a few have been processed. Ways are being sought to take unnecessary pressure off the Commission to enable it to deal with the more difficult or complex cases. Legislation will be tabled to enable claimants in less complicated cases to have direct access to the land Claims Court with the leave of the Court.

A restitution claim will be accepted for investigation in terms of section 2 of the Restitution of Land Rights Act and section 121(4) of the Interim Constitution where the claimant was:

(In terms of the new Constitution, the fourth condition is: dispossessed as a result of past racially discriminatory laws or practices.)

The claimant should have had a registered or unregistered right or interest. Such a right may have been established by occupation of the land for a substantial period. It is not limited to a right recognised by law. It is not limited to ownership rights, and it may include certain long-term tenancy rights and other occupational rights.

Recognition is thereby given to the fact that racial laws may have prohibited certain claimants from obtaining legal rights on account of their race.

The following examples, given in (a) and (b) below, may be considered by the Commission as qualifying for investigation in terms of the acceptance criteria.

(a) The Black Administration Act, 38 of 1927, the Development Trust and Land Act, 1936, the Group Areas Act, 1950, 1957 and 1966, the Community Development Act, 1996 and the Black Resettlement Act, 1954 were used to remove, evict and expropriate 'black spot' communities, unregistered and deregistered labour tenants and disqualified urban dwellers.

(b) Persons who were dispossessed as a result of threats of state action under racial land laws may also qualify. So-called voluntary removals and voluntary sales occurred when inducements of alternative land were made or after racially segregated residential areas were declared, but before final expropriation happened. In certain cases, apparently race-neutral laws such as the Slums Act and the Prevention of Illegal Squatting Act were used to effect racial zoning. In other cases, state action under discriminatory law played a secondary role in the process of dispossession, and private parties contributed to the discriminatory act of dispossession.

If dispossession occurred in the form of expropriation under certain legislation, the claimants must show that they did not receive just and equitable compensation at the time of dispossession, taking into account the circumstances of the dispossession.

The Constitution does not allow the Land Claims Court to consider compensation claims arising from dispossession prior to 19 June 1913. This is the date when the Native Land Act was promulgated. It heralded the formal adoption of territorial segregation as the leading principle of post-Union land policy. The 1913 cut-off date recognises that systematic dispossession predated the post-1948 grand apartheid era of legally sanctioned forced removals. However, although dispossession took place during the colonial era prior to 1913 through wars, conquest, treaty and treachery, the government believes these injustices cannot reasonably be dealt with by the Land Claims Court.

The government believes it is not possible to address pre-1913 claims through a judicial process such as that laid out in the Restitution of Land Rights Act or Aboriginal Title Arguments that have been used in countries such as Canada and Australia. In South Africa, ancestral land claims could create a number of problems and legal-political complexities that would be impossible to unravel:

To what date should the clock be put back? Would it be possible for the courts to verify the historical land claims? On what basis would the legitimate descendants be identified and apportioned compensation?

The government's land redistribution programme must address the present-day effects of this historical dispossession. In cases of established merit, priority access to the programme may be granted.

4.14.3 Historical claims pre-1913 and labour tenants

There will be numerous claims from people who fall outside the scope of the Restitution of Land Rights Act, either because they did not have a 'right in land' as defined in the Act because they were not dispossessed as a result of racially discriminatory laws and policies, or because they were dispossessed prior to 19 June, 1913. The Department is committed actively to seek alternative remedies. Cases of unfair dispossession of land which are not provided for in the Restitution of Land Rights Act, will be accorded priority status in the land reform programme. Furthermore, the Commission is empowered to make recommendations to the Minister on alternative remedies for such claimants.

Remedies must take into account the specific context of each category of potential claimant:

4.14.4 Forms of restitution

People who were dispossessed, as defined in the Restitution of Land Rights Act and the Constitution, have a right to restitution. What has to be resolved is the form in which the right will be recognised. The constitutional right to claim restitution does not mean that each and every successful claimant will receive a piece of land, a house and/or an amount in compensation. The overriding principle of fairness and equity dictate that each case must be treated on its merits. However, the constitutional right to restitution does, at the very least, guarantee each successful claimant the right to participate in formulating a restitution package to give recognition to such claims.

Many claimants feel strongly about returning to the particular land from which they were removed. Others want another form of recognition of their loss and violation of their human rights. The restitution process does not prescribe the outcome of each claim, but provides a framework and various options which can be used to arrive at an appropriate solution through negotiation by the parties or adjudication by the Land Claims Court.

Restitution can take the following forms:

The principle is that preference should be given to the restoration of land. Any compensation that was received at the time of removal, and any improvements to the property since dispossession will have to be taken into account when structuring the package for restoration. At the same time, the process of restoration should be supported by providing restitution beneficiaries priority access to land-focused support programmes in terms of a Settlement/Land Acquisition Grant or the National Housing Subsidy which is set at a maximum of R15 000 per household. It is vital that the intention of claimants who wish to return to the land is noted and the implications and feasibility of restoration determined, as early as possible in the restitution process, in order to enable the necessary planning and preparation.

Certain successful claimants may be able to access other grants and services of the Land Reform Programme which are summarised in Box 4.3. Preferential treatment will be given to people who show initiative in resolving claims through locally negotiated settlements, or other innovative means.

Where land is awarded, the Land Claims Court may determine the manner in which rights are to be held and set conditions to ensure that all dispossessed members of a community shall have access to the land, on a basis which is fair and non-discriminatory towards any person, including women and people whose rights were not formally recognised due to racially-based measures of the past.

4.14.5 Compensation

(a) Compensation to claimants

The state will have to compensate certain successful claimants where restoration or other remedies are not appropriate. These claimants would be persons who held rights in land which were taken from them with inadequate or no compensation. The Interim Constitution entitles such claimants to just and equitable compensation. The applicable portion of Section 123(4)(a) reads as follows:

The compensation...shall be...just and equitable taking into account the circumstances which prevailed at the time of the dispossession and all other factors as may be prescribed by the (Restitution of Land Rights Act, 1994 [such as factors listed in Section 34]), including any compensation that was paid upon such dispossession.

It is impossible to prescribe fixed rules for the determination of just and equitable compensation to claimants. However, the principle would be to compare the compensation that was received at the time of dispossession with the compensation for the land to which the claimant would have been entitled had he or she been expropriated in terms of the provisions of Section 28(3) of the Interim Constitution read with the Expropriation Act. This difference should serve as the basis for calculating the compensation to claimants.

In practice, it may prove very difficult to make such calculations. Ways will be sought on a case-by-case basis, through negotiations between the parties, to determine the appropriate compensation amounts. Should negotiations fail, the Court should determine the amounts payable.

(b) Compensation to land owners

The question of compensation for privately owned land needed for restitution is dealt with in sections 28(3) and 123(2) of the Interim Constitution. Section 123(2) provides that where land is expropriated for compensation, this shall be subject to the payment of 'just and equitable' compensation calculated in the manner provided for in section 28(3). The relevant portion of Section 28(3) reads as follows:

.....where any rights in property are expropriated..., such expropriation...shall be subject to the payment of agreed compensation or, failing agreement, to the payment of such compensation and within such period as may be determined by a Court of Law as just and equitable, taking into account all relevant factors, including, in the case of the determination of compensation, the use to which the property is being put, the history of its acquisition, its market value, the value of the investments in it by those affected and the interests of those affected.

The underlying principle is that while an owner should be fairly compensated for what he or she paid for or invested in the land, he or she should not make a profit at the expense of the public as a result of any special benefits that were given. This principle remains the same under the new Constitution.

Ultimately it is the Courts, and not the Department, that have the power to determine what is 'just and equitable' compensation. However, the Department has a mandate and an obligation to enter into negotiations with the relevant role players to try to settle the issue of compensation prior to referral of the matter to the Courts. The Department will enter such negotiations in terms of guidelines derived from the 1995 report of the Ministerial Committee Regarding the Determination of Land Values. In terms of those guidelines, the calculation of 'just and equitable' compensation should have regard to the following factors, amongst others that may be relevant in particular circumstances:

4.14.6 Urban claims

There are a number of factors which complicate the resolution of urban claims.

On the other hand, the restitution programme provides the opportunity to initiate a process of healing, re-integrating and reconstructing the cities and towns that still bear the scars of racial zoning.

Although the above mentioned conditions are particularly prevalent in urban areas, they also apply to many rural cases. The following guidelines are presented to ensure a fair and streamlined procedure to deal with these cases:

(a) Claimants will be encouraged to form groups for each affected town, suburb or former group area to jointly submit and/or negotiate the settlement of their claims. There will be general guidelines and rules for membership and allocation, but the group should be involved in the definition of what the appropriate solution in their particular case would be.

(b) Former residents of areas such as Pageview, District Six and Cato Manor should be afforded the opportunity to participate in shaping the future of the areas which are still available for development. Where appropriate, available alternative land could also be included in the development projects. The nature of this participation in the planning process should be the subject of negotiations, but should recognise that there are broader public interests which should also be considered in the planning process. It is important that this process be driven by local needs and concerns.

(c) Successful claimants should be afforded the opportunity to acquire property within the framework of the above mentioned development projects. Where appropriate, these participants will be offered development assistance within the framework of the housing programme for the area. The Act provides a number of mechanisms to support development-directed group resolution (see Box 4.8). Moreover, other statutory instruments, such as the Development Facilitation Act, the Communal Property Association Act, and Housing Subsidy Guidelines for Institutions may further bolster group restitution initiatives. The beneficiaries of housing programmes who do not qualify for restitution could also be included in group development projects.

(d) Individual portions of land for residential and related uses where it is fair and feasible to effect such actual restoration. In these cases, claimants would be returned and may be expected to contribute to the acquisition costs on a market related basis, taking into account any compensation received at the time of dispossession.

(e) Compensation to individual claimants: Any compensation paid or other consideration received at the time of dispossession will be taken into account when calculating reparatory compensation, if any. Participation in development projects does not exclude individual claims for reparatory compensation.

The Department will play a central role in coordinating the urban restitution policy. It will work with appropriate authorities to identify land that potentially can be used for group initiatives. Within the framework of the restitution and land reform budget, the Department will, if financially feasible, provide a special restitution (planning) budget to each town and city (or parts of cities and suburbs) affected by apartheid residential segregation and from which a substantial number of restitution claims originate. The local authority should be the driving force to bring local negotiation processes to fruition. Local authorities that show initiative in the restitution programme will get priority consideration for planning budgets. The Department, in cooperation with provincial government and Provincial Housing Boards, will give special attention to the plight of victims of urban dispossession who lack shelter and security of tenure.

Private sector and other civil society initiatives will be crucial for the viability of locally negotiated group restitution projects. A National Urban Restitution Task Team is being considered to bring the relevant role players together and provide direction to the urban restitution process. In addition, Urban Restitution Steering Committees at provincial level may be necessary for areas where large numbers of claims are clustered, such as the Western Cape, the Eastern Cape, KwaZulu-Natal, and Gauteng.

Land Tenure Reform

4.15 Introduction

Tenure reform is a particularly complex process. It involves interests in land and the form that these interests should take. In South Africa, tenure reform must address difficult problems created in the past. The solutions to these problems may entail new systems of land holding, land rights and forms of ownership, and therefore have far-reaching implications. For these reasons policy development in respect of tenure reform has to be done with extreme care. In order to ensure this, a two year period was set aside for consultation around tenure policy, for implementation of test cases and for the preparation of legislation. In the interim, a number of measures have been introduced to deal with urgent and pressing matters that cannot wait. A separate Green Paper on Tenure Policy will be released at the end of 1997. The guiding principles that are informing the policy development process and the programme of action that is being undertaken are described below.

4.16 Guiding principles of tenure reform

In instances where overlapping and conflicting rights make it impossible for different vested rights to be upgraded within one area, it will be necessary to accommodate vested rights on additional land. The Settlement/Land Acquisition Grant or other appropriate compensation will be used to assist people to acquire land in instances where others have stronger rights to the land which is currently occupied. The acceptance that tenure reform will require the acquisition of additional land in specific circumstances will ensure that tenure reform and upgrading of rights happens in a way which does not lead to internal evictions which would undermine the principle of security of tenure. It also addresses the reality that most tenure problems are exacerbated, if not caused, by severe land shortages and overcrowding.

4.17 Land tenure laws

Two important pieces of legislation dealing with tenure have been passed by Parliament in 1996. These are the Interim Protection of Informal Land Rights Act, 31 of 1996, and the Communal Property Associations Act, 28 of 1996. The first is a holding mechanism that prevents violation of existing interests in land until new long-term legislation is in place. The latter provides a means through which people wanting to hold land jointly and in groups can organise their tenure. In addition, the Upgrading of Land Tenure Rights Act, 112 of 1991, was amended to bring it in line with tenure policy (see Boxes 4.9, 4.10 & 4.11).

4.18 Constitutional guarantees The new Constitution guarantees:

25 (6) A person or community whose tenure of land is legally insecure as a result of past racially discriminatory laws or practices is entitled, to the extent provided by an Act of Parliament, either to tenure which is legally secure, or to comparable redress.

25 (9) Parliament must enact the legislation referred to in subsection (6).

These provisions put the Department of Land Affairs under a constitutional obligation to develop a law which sets out the types of vested interests in land which were undermined by discriminatory laws and a mechanism to convert such interests into legally secure tenure rights. The rights based approach and adjudicatory principles are being developed to fulfil this task.

4.19 The Land Tenure Reform Programme

Tenure reform delivers security of tenure in diverse ways. For example: by the award of independent land rights and secure lease agreements; through protection against eviction; by membership of a group based system of land rights or through private ownership. There are a series of key tasks that are necessary in order to develop the government's tenure reform programme. The most important of these are the following:

Once it has been assessed and finalised the criteria and procedures for government funding of the process will be set out in law. This process will entail a review of the Upgrading of Land Tenure Rights Act, 112 of 1991.

The bias in our law towards the rights of owners as against other occupants, results in evictions being allowed which are unfair and cause major social, political and economic dislocation. In this context it is necessary to revisit the current laws governing evictions and develop proposals that limit the circumstances and procedures which govern evictions.

Alternatives which enable people to escape their status as insecure and subservient on land belonging to others must be created, including the provision of additional land on which people can enjoy independent land rights. Without additional land the extreme overcrowding and pressure on land which is the root cause of tenure breakdown remains untouched.

It is also necessary to develop a law which regulates and protects the rights of occupants on land belonging to others. An analogy is protective tenancy measures.

The Department has recently published a Bill intended to address this situation. The Extension of Security of Tenure Bill addresses the relationship between occupiers and owners, as well as the circumstances under which evictions can take place, and the procedures to be followed.

The Bill is underpinned by the following four principles:

The Bill is applicable in all areas except proclaimed townships and therefore affects relationships between owners and occupiers in a wide range of rural and peri-urban situations.

A point of departure in the 'upgrading context' is that the 'rights enquiry process' would establish whether the rights at issue are group based or individual. Where the rights belong to a group the group must be able, by democratic majority, to choose what form of land holding system best suits their needs. They may choose to individualise their rights but this decision would be valid only if it was taken by the majority of rights holders. One of the challenges of the new forms of ownership is that they must be flexible and accommodate change over time. The laws in terms of which they are created must also provide for adequate rules and institutions to support the efficient functioning of that particular form of ownership. They must also protect the rights of members from abuse under group systems and uphold the basic human rights guaranteed in the Constitution of the country.

At the moment the only legal solution in this context has been for the people affected to form family trusts and similar institutions. This is expensive and puts a heavy burden on the process. Thus a new form of family ownership which will be simple and easy to administer is being investigated to address the problem.

In the interim the Department of Land Affairs is of the view that such areas should be treated as privately owned land. There are many areas which have belonged to particular groups or tribes since time immemorial. There are also areas where groups purchased land but did not get title. Instead, in both cases the land is registered in the deeds office as Astate owned@. This is an anomaly created under colonialism and apartheid. In such instances the rights of the long term holders of the land should be treated as ownership rights. This means that no tier of government or government department has the right to treat the land as state owned. Instead the rights holders must be consulted in all matters pertaining to their land rights. Anything less would amount to confiscation of historical or indigenous land rights.

When formal transfer takes place, it must enable the members of such group systems to exercise and protect their land rights effectively through democratic processes. Accordingly the ownership of the land will vest not with chiefs, tribal authorities, trustees or committees but in the members of the group as co-owners of the property.

It will be set out in law that the members of the landowning group will have the power to choose the structure which represents them in decisions pertaining to the day to day management of the land and all issues relating to members' access to the land asset. A majority of members would also be able to set aside unpopular decisions made by the land management structure.

The law will also provide for protections pertaining to equality and rights for women. Any decision which discriminates against women would be invalid. In order for the rights and protection enshrined in the envisaged law to be effective, no transfer of land to group based systems will happen until there has been a process of information sharing and discussion with the members of the land holding group.

It is recognised that there are many areas in which the system of customary land tenure is popular, functional and relatively democratic. It would be unnecessary and even dangerous to interfere which such functional systems, especially while there is no proven better alternative. However, there are also areas where abuse by chiefs and tribal authorities is endemic and women are severely discriminated against. It is intended that the above measures would enable functional and popular traditional systems to continue operating, while providing a strong and guaranteed route for a majority of dissatisfied members to replace control over land by illegitimate structures with new democratic institutions.

The Department of Land Affairs does not believe that the above measures are in conflict with customary law. They provide recognition and protection for indigenous land rights and vest the ultimate ownership and control over the land with the members of a group as is the case under customary law. The requirement that traditional systems adapt to accommodate the changing position of women is also not fundamentally threatening to customary law. There are many deeply traditional areas where these changes are happening spontaneously.

These measures are necessary in order for tenure reform to conform with the Constitution and will provide redress to members of group systems whose basic human rights have been abrogated. Much of the land which will be transferred to group ownership is currently held in trust by the Minister for Agriculture and Land Affairs. He or she is under a fiduciary duty to ensure that the form of transfer of ownership accommodates and protects the rights of all the beneficiaries of the trusts which will be wound up at the point of transfer to full ownership.

One of the options available to members of group ownership systems will be to convert their rights into individual ownership as long as the decision is taken by democratic majority. They may also choose to individualise only certain areas and impose particular conditions in these areas. The Department will develop forms of ownership which accommodate different choices including a combination of individually owned areas within group ownership systems. This may be done by amending existing laws to make current legal options accessible to people living under isolated rural conditions. The intention is to provide people with a range of options from which they can choose, it is also to design the systems to be flexible to accommodate change over time.

While the Department of Land Affairs is committed to the recognition and protection of pre-existing land rights which were undermined by colonialism and apartheid, it is equally committed to protecting and upholding the basic human rights of all South Africans. In particular the rights of members of group based land holding systems must be protected, especially the process of inclusive decision making in all matters pertaining to the management of the jointly held land asset.

In some provinces chiefs and tribal authorities have been involved in processes which appropriate land reform projects to themselves rather than to all the intended beneficiaries, or to all the members of the tribe which owns the land. This is counter to our policy and measures are being put in place to ensure that such misappropriation of land reform assets cannot take place.

Unfortunately the Department's acceptance of group based land holding systems and the recognition of historical land rights has been construed by some chiefs as an opportunity to consolidate their own personal power. The Department will not condone land reform measures being used to bolster individuals or small groupings of people. A process of monitoring and evaluation will be set up to assess whether we do in practice balance our joint goals of protecting group-based historical land rights and protecting the human rights of members of group-based systems. The test will be whether the members of group-based systems are able to make and challenge decisions in relation to their shared land asset in ways which reflect the views of the majority of members.

It is for reasons such as this that far reaching protections for women will be built into the new forms of ownership and the procedures for upgrading rights. The equality clause in the Constitution makes this a requirement. The Communal Property Associations Act already has important provisions in this regard and mechanisms to enforce the rights of women. Tenure reform provides key opportunities to build protection for the rights of women into the new forms of ownership which are being developed, in particular family based rights and group ownership systems.

4.20 Interim measures

The process of formalising and securing land rights which has been described previously will happen slowly and on request by the affected rights holders. A programme of forced land titling will not be undertaken. If the people affected do not deem it in their interests to go through the process of formalising land rights then experience elsewhere has shown that they will not maintain the system and the whole process will have been an irrelevant wastage of state resources. Furthermore, there is limited capacity within government to respond even to the areas where urgent requests for untangling and formalisation of rights are being made.

Both of these factors imply that there will be extensive areas where tenure reform does not take place for many years. In the interim much of the land in the former homeland areas remains registered as state owned. The people living on this land do not have the legal capacity to protect or control this land. If the land belonged to them the powers and duties of ownership would be devolved to them. However, whilst it still belongs to the state the question of the administration of these areas remains a government responsibility. The existing permit based Permission to Occupy system contradicts many of the tenure principles described above. It is prime apartheid legislation that will remain in force in many places for some time to come. To deal with this, interim measures that entail a limited reform of regulations governing access to and control over land are being established. These are described in the section dealing with land administration. (see Section 5.12 B 5.13).

Financial Grants of the Land Reform Programme

4.21 Introduction

The Department of Land Affairs offers the following grants in support of the Land Reform Programme. To varying degrees and in different ways, each of these is applicable to each of the main Land Reform focus areas, ie restitution, redistribution and tenure reform. In summary, these are:

(a) Settlement/Land Acquisition Grant: This grant is currently set at a maximum of R15 000 per qualifying person, to be used for land acquisition, enhancement of tenure rights, and investments in infrastructure, home improvements, and farm capital investment according to the plans put forward by applicants.

(b) Grant for the Acquisition of Land for Municipal Commonage: This grant is to enable primary municipalities to acquire land in order to extend or create a commonage for the use of qualifying persons.

(c) Settlement Planning Grant: This grant is to be used to enlist the services of planners and other professionals, who will assist the applicants in preparing grant applications.

(d) Grant for determining Land Development Objectives (LDOs): This grant provides for under-resourced, poor or rural local authorities to undertake a strategic planning process to set 'land development objectives' (under Section 28 of the Development Facilitation Act, 67 of 1995), on the understanding that this provides a framework for decision making on the allocation of resources for land reform and settlement.

4.22 Eligible applicants

Applications for the above mentioned grants can be made by, or on behalf of, the following:

4.23 The Settlement/Land Acquisition Grant

4.23.1 Objective

The objective of the Settlement/Land Acquisition Grant is to improve land tenure security and to extend property ownership and/or access to productive resources to the historically disadvantaged and the poor.

To this end the grant can be used :

It is understood that the focus of this grant is to assist those who in the first instance have land needs and security of tenure needs. Where mainly water provision or housing is sought, the applicant should be directed to another more appropriate institution, such as the Department of Water Affairs and Forestry or the Department of Housing.

4.23.2 Eligibility

Being eligible in no way ensures that a grant will be awarded. Rather, eligibility determines whether an application will be considered. The award of the grant will depend upon the approval of a grant application, including a business plan where required by the Department.

Qualifying persons: In line with the Department of Housing guidelines in the 'Housing Subsidy Scheme' Manual ( November 1995), any person who complies with the criteria laid down in this section may qualify for a grant , if he or she is married (in terms of the Civil Law or in terms of Customary Union) or habitually cohabits with any other person; or if he or she has proven financial dependants. For the purposes of the grant, the word Aspouse@ includes any partner with whom an applicant under the Scheme habitually cohabits. A person shall qualify for the maximum amount of the subsidy only if:

Single persons (of either sex) without dependants will not normally qualify for the grant. In cases where it can be reasonably established that this regulation unfairly acts against a single needy person without dependants, the Department official responsible will use his or her discretion in deciding whether a grant should be awarded. Qualifying persons may apply individually or as groups. Qualifying persons which have an average household income of less than R1 500 per month are eligible for the grant. For groups, average household income must be less than R1 500 per month. Although a means test for groups will not be applied as a matter of routine, in certain cases investigations may be conducted by the relevant authority and thereafter a decision made on the eligibility of the group.

4.23.3 Disbursement

The grant to an eligible person currently has an upper limit of R15 000 per qualifying person. Whether any grant money will be awarded at all, and if so, how much, depends upon the decision of the Provincial Director of the Department of Land Affairs after consultation with the relevant structures.

Grants awarded to applicants who have applied as a group, must be disposed of according to collective decision making, as determined in the group's charter or constitution. The pooling of grants does not preclude catering to differences among applicants in terms of how the money may be used, for example, the group may agree that some applicants will benefit more in terms of agricultural land than housing, while other group members will benefit more in terms of housing than land.

Disbursement of the grant for capital items (for example, livestock, machinery, wind pump) to be used in agricultural production and settlement, but excluding seasonal inputs (for example, seeds, fertilizers), will be subject to the following conditions.

Any government assistance for either land purchase or on-site services (excluding grants for provision of connector and/or bulk infrastructure) will be debited against the grant and/or the Housing Subsidy. To effect this, the grant will be registered on the same national data base as the national Housing Subsidy. A qualifying person may apply for both, and in any order, but cannot qualify for a total of more than R15 000. Also, any settlement benefits received from the government since 1 April 1994 will be taken into consideration in deciding the value of the subsidy which a qualifying person may obtain.

The grant may be applied to the acquisition of state land, where this is available and has been identified for redistributive purposes. The value of the state land would be debited against the grant for which the applicant qualifies.

The burden is on the applicant to consider carefully in advance how to use this once-off resource. By choosing to use the grant in a certain way, the applicant may have to forego other possible uses, particularly if the applicant has already drawn near the maximum. There should be flexibility in terms of how an applicant may seek to secure grant finance over time. For example, the applicant may apply for and be awarded a portion of the R15 000, and may then re-apply for an additional portion at some later date.

Until an award of a Settlement/Land Acquisition Grant is approved, the applicant(s) will generally not be in a position to make a firm offer on a particular piece of land. Properties offered for sale should nonetheless be identified and their affordability assessed on the basis of what share of the Grant might go towards land purchase and the size of their own contribution.

The grant will not necessarily cover the total costs involved in land acquisition and development. Own equity, loan financing and other sources may have to be tapped, either in terms of a partnership agreement or according to some other arrangement, for example, as may be developed in the course of the planning processes assisted through the Settlement Planning Grant.

4.23.4 Tenure and settlement options

The grant will be applied in a flexible way B to allow local initiatives to be accommodated in a range of different land acquisition and tenure situations. For example:

4.23.5 How to access the Settlement/Land Acquisition Grant

The grant can be obtained on application to the Department of Land Affairs. This must include a business plan. Depending upon the circumstances, the applicant(s) may need the assistance of a planner, who may be financed through the Settlement Planning Grant (see Section 4.25)

The application will be reviewed by the relevant Provincial Director of the Department of Land Affairs. The Provincial Director will obtain advice from the relevant provincial and municipal structures and departments and thereafter make decisions on grant applications in terms of the criteria set out above (see Section 4.22). The response to an application could be outright rejection (for example, if it does not fall within the brief of the Department of Land Affairs), rejection with suggestions for re-submission (for example, application may have merit, but needs refinement), partial approval (for example, only some of the group's intentions are considered worthy of funding at the time), or full approval. The review of the grant applications will be flexible and informative. The Department of Land Affairs will draw on its accumulated experience as much as possible to communicate with applying groups as to how they may improve their applications .

4.24 Grant for the Acquisition of Land for Municipal Commonage

4.24.1 Objective

The grant is to enable primary local authorities to acquire land to extend or create a commonage for the purpose of establishing schemes involving the productive use of the land resources (for example, food gardens, arable, grazing, wood fuel and other veld products, eco-tourism) by or for the benefit of poor and disadvantaged residents. Ownership would be retained by the municipality which would lease the land to qualifying applicants.

4.24.2 Disbursement and access to the Grant

The Department of Land Affairs will consider applications from primary level municipalities, subject to the following conditions being met:

To ensure that the land acquired with the grant is used for the intended purposes, a notarial deed of perpetual servitude will be endorsed on the title deed.

The application for the grant will be appraised by the Provincial Director of the Department of Land Affairs. The recommendations of the relevant provincial authorities and other key role players will be solicited in considering the application. In determining the level of the grant the following criteria will be considered:

4.25 Settlement Planning Grant

4.25.1 Objective

The grant is to assist poor communities to plan for the acquisition, use and development of land and for the mobilisation of resources required to do this.

The grant is designed to support each of the Department's three sub-programmes, namely restitution, redistribution and tenure reform. The grant can assist applicants for the Settlement/Land Acquisition Grant. It could also be used to support land reform initiatives undertaken by other institutions, for example, local authorities and NGOs (for example, churches) who wish to use their own land resources to implement land reform projects.

The grant enables those engaged in land reform initiatives to select and appoint Department of Land Affairs-accredited planners and other professionals from private firms and NGOs, with whom they will collaborate on a strategy for land reform. The services which can be covered by the grant include legal and financial-planning assistance, land use planning, infrastructure planning, land valuation, and assistance with land purchase negotiations, including the formation of a legal entity.

There are two principal planning phases that may be financed through the Settlement Planning Grant:

A given applicant may seek to take advantage of one or the other, or both. In certain restitution cases, the grant may be made to claimants early on in the negotiation process, on conditions to be determined on a case-by-case basis.

4.25.2 Eligibility

Applicants for the Settlement Planning Grant can be made by, or on behalf of, lawful citizens or permanent residents of the Republic of South Africa, listed in Section 4.22.

4.25.3 Disbursement

The Settlement Planning Grant (estimated at 9% of the project cost) is intended to be disbursed in two stages: 3% for feasibility study and 6% for detailed design. Provincial Directors should use their discretion in deciding how much to allocate at each stage. For projects of average size and complexity, the initial stage payment for feasibility study will usually be adequate. Only the large and complex projects would require a second instalment to pay for a detailed settlement plan.

9% of the total project cost should be seen as a reasonable upper limit to allocate to planning, rather than a hard and fast rule. Proposals to spend sums in excess of that amount on planning will be examined closely. The twin dangers of over-planning and over-expenditure on planning are ever present.

In cases involving land restitution and land tenure reform, the amount of the grant will be determined on a case-by-case basis.

4.25.4 How to obtain the Settlement Planning Grant

Interested parties wishing to acquire land under the Land Redistr