Failures of the land reform programme can be mitigated if the programme’s beneficiaries are provided with the required support, believes the Vumelana Advisory Fund, a non-profit organisation that has been providing support to beneficiary communities in the land reform space for over 10 years. To start with, governance within communal property associations (CPAs) needs to improve.
In many instances, the intended goal of empowering the beneficiary communities is not realised due to infighting among the beneficiary communities and lack of working capital, lack of resources to access water rights, and develop related critical infrastructure.
This, in turn, leads to once-productive land lying fallow. Often, the claimant communities lack the necessary skills and managerial aptitude to put in place the good governance structures that would give assurance to prospective investors of a return on their investment.
“Working with several claimant communities over the past 10 years has given us invaluable insights into the land reform programme and enabled us to develop an intimate understanding of how to capacitate the land reform beneficiaries and ensure that they use their land productively,” said Peter Setou, chief executive officer of Vumelana Advisory Fund.
“We have learnt that throwing money at the problem is not a magician’s wand that will change the fortunes of the land reform programme,” Setou said.
In addition, many case studies related to the land reform programme have a fair understanding of what works, and what doesn’t. This has helped Vumelana to identify which interventions are required to give impetus to the land reform programme.
Where CPAs miss the bus
Setou points out that the lack of good governance in many communal property associations (CPAs) is a major impediment dissuading potential investments.
To improve good governance, Vumelana Advisory introduced a programme called the Communal Property Institution Support Programme, or Organisational Development and Capacity Building, to support the development of well-governed CPAs. Setou said that the programme does not take a blanket approach but is tailored to meet the differing capacity needs of each beneficiary community.
The support given to claimant communities in accordance with this programme includes practical programmes such as institutional development support which entails providing CPAs with support to draft constitutions, develop trust deeds, and shareholder agreements.
The support also includes giving governance support to assist with beneficiary verification, preparing accounts and convening annual general meetings.
In addition, beneficiary communities are assisted with policy and procedure development and given management support. This encompasses support and advice on administration issues including, among others, remuneration, procurement, finance, human resources, and benefit distribution policies.
Guidance is given on operational issues such as the acquisition of premises, appointment of staff, selection and appointment of accountants, registration with the South African Revenue Services (Sars) and opening of bank accounts. This assistance also extends to capacity building and training in financial management, record keeping, and corporate governance support.
The transaction advisory support programme
This is one of the flagship programmes that is designed to support land reform beneficiary communities and investors conclude community private partnerships.
Vumelana Advisory Fund has always believed that the success of the land reform programme hinges on mutually beneficial partnerships between the beneficiary communities and commercial investors who have the capital required to make the land productive.
These community private partnerships provide opportunities for income, employment, skills development, shareholding and ultimately the transfer of operations to communities without the community giving up ownership of the land or depending on government grants.
These partnerships provide a commercial foundation for the economic development of local communities. To build on this foundation, CPAs and other land-holding entities that are custodians of the communities’ assets must be well-governed and properly managed.
Good governance is a prerequisite
“The land reform programme has immense potential to stimulate rural economic development, contribute meaningfully to food security and create employment opportunities.
“Properly managed, this programme provides a pathway out of poverty for land reform beneficiary communities. Our experience has shown time and again that those CPAs that manage their affairs in a diligent manner have a better chance of attracting much-need commercial partners. So, good governance is not an option, but a prerequisite to a successful land reform programme,” Setou said.
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