Transcript Revisiting the “Willing Buyer, Willing Seller” Principle

Revisiting the “Willing Buyer,
Willing Seller” Principle
By Ebrezia Johnson
University of Stellenbosch
Presentation for the Land Law Forum
16 August 2005
Reasons for Revisiting the WSWB Principle

Property Clause (S 25 of the Constitution) regarded as being responsible for
slow pace of land reform

Slow pace of land reform = 3% land transferred to Blacks since 1994

Land hunger → Land grabs → Reality or Myth?
Origins of WBWS Principle

Advocated in 1990’s by the World Bank as a market-led/market-based
mechanism by means of the following:
 Selective expropriation; land taxes; subdividing landholdings & the
negotiation of ‘exit strategies for current landowners’
 Approach to WBWS of the ANC differ substantially from that of the World
Bank – set out in their South African Agriculture: Structure, Performance
and Options for the Future
Origins of WBWS Principle (Cont.)

WBWS usage history in SA with regard to the 1975 Expropriation Act

WBWS absent: ANC’s Ready to Govern document & 1994 the RDP
programme

1997: White Paper on South African Land Policy → WBWS cornerstone of
land reform policy
Meaning of WBWS

WBWS – distinct meaning in SA context

Willing sellers (private owners) → choice to sell or not to sell → their land →
@ market or market-related prices to the highest bidder or buyer of choice

3 Elements of WBWS in SA:
i. Discretionary powers of landowners
ii. Compensation to be paid to landowners
iii. Role of the State in acquiring the land
WBWS – General Remarks

Willingness to acquire land by landless still dependant on willingness of seller
& the willingness of State to approve application and provide funding

WBWS protects property rights of current landowners

According to Lahiff (Plaas, Policy Brief no.17) State “chose not to enter the
land market on behalf of potential beneficiaries.”
WBWS – General Remarks (Cont.)

State provide grants to potential land beneficiaries- who themselves have to
identify a ‘willing seller’ → secure an agreement → buy land @ agreed price

Lahiff: Willing buyer = abstract concept: “refer neither to the State (which
does not buy land on its own behalf or own initiative) nor to the intended
beneficiaries (who only become effective buyers once they secure state
approval and funding.
WBWS - Recommendations

Not full-scale expropriation of land – unwilling seller – selective expropriation
of portion of land together with land tax incentives offered by the State to
unwilling sellers

And still offering market-related compensation for the to be expropriated land
based on principles of if being just and equitable
WBWS - Recommendations

Not Full scale expropriations → anarchy = land grabs = Zimbabwe route of
speeding up land reform

Lahiff: acquiring land by paying productive value – based on estimated
productive value of the land in case of agricultural usage of the land
WBWS - Recommendations (Cont.)

Role of the State should become more visible and pro-active