Viable alternatives to government’s expropriation plans


Martin van Staden | Executive Committee | Rule of Law Board of Advisors | Free Market Foundation | mail me |

We published a new research paper highlighting the dangers of property confiscation (also known as expropriation without compensation) and nationalisation.

The paper Private Property, Public Interest: Alternatives to Confiscation and Nationalisation identifies at least five alternatives, each of which empowers the vulnerable, to the government’s dangerous plans which simply empower the state.

Parliament is on the cusp of amending the constitution to allow the government to confiscate property without compensation, and even to nationalise all fixed property.

Recognising the right to own and control property

The Expropriation Bill, being separately considered, is the means through which the government will try to achieve this.

The paper discusses:

  • The dangers of government’s proposed confiscation regime.
  • Why secure, entrenched private property rights serve, rather than undermine or hamstring, the public interest.
  • Discusses the alternatives to confiscation and nationalisation. These include the fact that government is financially capable of providing market-related compensation for expropriations; that restitution of land and property is achievable (indeed imperative) without destroying property rights; that urban land reform success is within grasp but underappreciated; and that much can be done about rural reform without threatening the economy or food security.
  • A viable, pro-property rights alternative to the government’s proposed legislation

All the progress made since apartheid ended stands to be undone unless people recognise that a most fundamental human right is for people to have the ability to own and control property.

Property rights and economic prosperity

When security of tenure and property ownership are removed, quality of life and income levels decline across all races and economic classes.

Property rights are a vital ingredient for countries that wish to achieve a high level of economic prosperity for the majority of their citizens.

The Economic Freedom of the World Report shows that the poorest 10% of people in countries in the top quarter of economic freedom have incomes nearly eight times higher ($12,293) than their counterparts ($1,558, PPP constant 2017, international$) in the lowest quarter economically free nations over the 2000-2018 period.

Notably, the higher a country ranks in the report, generally, the stronger the property rights (and state respect thereof) in said country.

We maintain that confiscation, and particularly nationalisation, amounts to the stripping away of all South Africans’ property rights. This will in no way resolve the country’s land dispossession legacy. Instead, it will make life even more difficult for the poor. Those who can afford to leave South Africa will do so; but for the majority, this will not be an option.

Addressing the causes of state capture and looting

Further, to adequately address the causes of the decade of state capture and looting during the COVID-19 pandemic requires the avoidance of policies that increase the discretionary powers of ministers and officials, as confiscation would entail.

The kind of transformation the country needs is of the empowering kind, as opposed to the kind that would strip away South Africans’ property rights.

Aside from its political disenfranchisement of black, coloured, and South Africans of Indian descent, apartheid’s greatest crime was its denial of the common law property rights protection enjoyed by whites. South African must not repeat the easily avoidable mistakes of the past.



Please enter your comment!
Please enter your name here