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DA: Statement by Lindiwe Mazibuko, Democratic Alliance shadow minister of rural development, land reform and poverty alleviation, on farm equity schemes (15/11/2010)

15th November 2010

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The Democratic Alliance (DA) welcomes the remarks of Rural Development & Land Reform Minister, Gugile Nkwinti, on the national government's intention in January 2011 to lift the moratorium on farm equity schemes (FES) - a land reform model which entails the state acquiring shares of commercial farms on behalf of the farm workers who work on them.

Farm equity schemes enable owners who want to sell their farms to do so through a scheme in which farm workers buy a percentage of the property. This is paid for by the government, using funding allocated to the Department of Rural Development for land reform purposes. Equity share agreements can be negotiated in various proportions, but in the Western Cape - where, despite isolated problems, these schemes have worked - we have found that they work best when there is a 50/50 sharing of risk and reward.

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The result has been that poor people, historically excluded from land ownership, gain access to high-value agricultural land while retaining the involvement, commitment and shared risk of the commercial farmer. This is a crucial determinant of long-term viability in land reform initiatives. It means that land reform can happen in the high-value sectors of our rural economy, and it means that land reform can become the basis for new investment and value creation in the rural economy.

The government's re-investment in equity schemes must, however, be coupled with enough safeguards to ensure that farm workers are not exploited in the process. And central to the implementation of the programme must be a commitment to the principle of willing-buyer, willing-seller.

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The DA's approach to land reform has always been about the creation of genuine, broad-based opportunity, coupled with the expansion and diversification of South Africa's commercial agriculture sector to increase productivity, create more rural jobs and promote food security. Farm equity schemes have consistently been shown to have a higher success rate than the current land reform model in which government transfers land to emerging farmers without adequate post-settlement support. We will continue to monitor the Department's implementation of the programme to ensure that land reform in South Africa becomes a win-win opportunity for all stakeholders.

 

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