Funding gaps remain the silent killers
of land reform success, writes Peter Setou
The funding gap – the persistent vacuum between the legal restoration of land and its evolution into a self-sustaining asset – is quietly negating the promise of South Africa’s land reform programme.
The narrative on the ground has become tragically predictable, report after report details the plight of beneficiaries who hold title to land that yields no fruit. Three decades into democracy, it is estimated that up to 70% of restituted land in South Africa remains fallow or less productive. This is not for a lack of will but is due to a systemic lack of post-settlement support and funding challenges. Inadequate skills, lack of access to funding and market access gaps, coupled with poor basic governance practices continue to affect the results of the land reform programme. This hampers the ability of beneficiary communities to utilise their newly acquired assets to support their livelihoods, including creating much needed jobs.
Vumelana suggests that the private sector can provide a vital missing link in supporting a sustainable land reform programme. By strategically repurposing Corporate Social Investment (CSI) from traditional charity to catalytic economic support, businesses can bridge these gaps and turn the tide.
Traditional models of support have not been successful
While government’s efforts to restore land to previously disadvantaged communities should be lauded, the transfer of land alone is not enough.
The Recapitalisation and Development Programme (RECAP), for example, launched in 2010, aimed to breathe life into struggling projects by moving away from once-off grants toward a mentorship model. The intention was to pair communities with established commercial “strategic partners” to guide them through technical production. However, the reality was often a mismatch between the beneficiaries and the strategic partners, in many cases, partners were accused of self-dealing, using government funds to benefit their own operations rather than transferring skills. Additionally, poor planning and ineffective implementation on the part of government also contributed to failure in these projects. Monitoring to ensure that knowledge was actually being shared was negligible and many communities were left no better off when the five-year RECAP period ended.
Similarly, the Comprehensive Agricultural Support Programme (CASP) is frequently criticised for its implementation gap. Designed to provide six pillars of support, including research and marketing, it has been marred by capacity challenges. Provincial departments often lack the technical staff and resources to deliver holistic support. Consequently, CASP frequently devolves into a fencing and water tank programme, providing physical infrastructure but failing to provide the market access and financial management skills required to enable beneficiaries to turn a profit from their land.
Bridging the gaps
Partnerships with private sector players offer some hope in turning the situation around, but these partnerships cannot happen in a vacuum. They require independent facilitation through credible and experienced transaction advisors who can help the community to navigate through complex negotiations with experienced private sector players and ensure that agreements are fair to both parties. This, however, requires funding, and government can play an invaluable role in funding a transaction advisory programme aimed at supporting land reform beneficiaries.
This must be complemented by a capacity-building and institutional support programme targeting CPAs to ensure good governance and improved management of restored assets.
This will in turn ensure that CPAs remain stable and investment-ready and thus attract private investors with whom to partner and put the restored land to productive use.
When partnerships work, land reform can thrive
Despite the challenges’ impact on land reform, there are pockets of success which demonstrate what is possible when these gaps are bridged. Through the Community Private Partnerships (CPP) model, Vumelana has managed to showcase what success can look like when these partnerships are independently facilitated with the best interest of both parties in mind, the beneficiary communities and the private investor.
The Moletele CPA in Limpopo serves as a good example: through structured partnerships, they have successfully managed vast citrus and mango estates, proving that community-owned land can compete in global markets.
Similarly, the Mmamahlola CPA and the Masakona CPA have shown that when governance is prioritised and professional transaction advisory is utilised, communities can move beyond subsistence. These cases highlight that success isn’t just about farming – it’s about well-structured partnerships, where risks and rewards are proportionally shared, and the private sector brings the technical mentorship that state programmes often lack.
Repurposing CSI for restitution projects
The private sector needs to recognise that investing in the success of land reform is an investment in broader social cohesion and economic sustainability.
CSI allocations can play a crucial role in enabling a successful land reform programme. With the right monitoring and evaluation structures in place, there is a lot of opportunity for scale and progress.
CSI in this instance should not be seen as a donation, but as a fundamental de-risking agent. When a company funds governance training for a CPA or covers the legal fees for a joint-venture agreement, it creates a new, stable partner who will contribute to the economy, one that can be self-sustaining, create jobs and expand market reach.
There is an opportunity for the private sector to use CSI budgets to embrace proven land reform models, including progressive partnership driven models and to scale up some of the innovative work done on restituted land to date.
Furthermore, the private sector can play a greater role in supporting efforts to bridge governance gaps among CPAs, empowering them to put structures in place to use their land productively.
The land reform programme can, without a doubt, reach its full potential through closer collaboration between the private sector and non-profit organisations, supported by government, working together.
Peter Setou is the Chief Executive of the Vumelana Advisory Fund (Vumelana) a non-profit organisation that was established in 2012 to help communities in the land reform programme to put their land to productive use through its
Community Private Partnership (CPP) model. Vumelana funds advisory services to structure commercially viable partnerships between communities and investors that create jobs, income and skills.
Vumelana aims to demonstrate the value of partnerships as a means of fostering productive use of restored land, providing linkages to finance, skills and networks needed to make effective use of land and at the same time encourage a more inclusive agenda for land reform.
For more information about the organisation, visit www.vumelana.org.za. To contribute to Vumelana’s work, email info@vumelana.org.za
