File Image: Noel Mcshane/Pexels
File Image: Noel Mcshane/Pexels

Municipality using 139 farms for Eskom debt security ’sign there’s ample land for redistribution’

By IOL Reporter Time of article published Sep 17, 2020

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Cape Town – The fact that the Free State Matjhabeng municipality has agreed to hand over 139 farms as security for its R3.4 billion Eskom debt shows that expropriating land without compensation (EWC) isn’t necessary.

This is the view of Free Market Foundation chief executive Leon Louw. Commenting on the farms Eskom values at R2.5 billion, or R18 million each on average, he said in a statement on Thursday “it appears that municipalities are sitting on vast tracts of superfluous land”.

“If the Matjhabeng municipality’s 139 farms are indicative of the rest of the country, the government has ample land for redistribution.”

Louw is stunned by the fact that this revelation has not generated a political and media outrage.

“Government defends EWC and the Section 25 Bill on the pretext that the willing buyer-willing seller model was necessary and failed.

’’Municipal ’farms’ are probably a small proportion of all government land. The government, especially through municipalities, owns an unknown amount of mostly derelict land, especially ’reserved’ land, which could and should be redistributed before private property is seized.

’’The scale of the scandal was exposed this week when Eskom announced that the Free State Matjhabeng municipality (which includes Welkom) had ’agreed to hand over… 139 farms’ as security for its R3.4 billion debt.

’’There is no description of the farms, so there are more questions than answers. Are they genuine farms?

’’If farmed, by whom? If not, why not? What will be done with them by Eskom? Will it start farming, sell the farms, or redistribute them? Will the government subject them to EWC? If not, why not?

’’What is one of South Africa’s allegedly most corrupt municipalities doing with 139 or more farms? Why has it not paid R3.4 billion? Why does Eskom allow it?

Municipalities sometimes own land, technically called “farms”, on the urban periphery for low-cost “township” housing, Louw said. This is an apartheid legacy.

’’For obvious economic efficiency reasons, these should have been sold and turned into real farms long ago, and small parcels of new land bought as and where required,“ Louw said.

'’Before embarking down the perilous road of EWC, the government should establish what land it already owns at all three levels of government as well as through SOEs (state-owned enterprises) and redistribute it.

“It should abandon the apartheid policy of leasing land to black people and convert all black-occupied land to full unambiguous freely tradable freehold title. Only then will we be rid of the apartheid land legacy.”

IOL

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