CPAs: Missed chance for rural economic growth

Source: Supplied. Ayanda Ngubo, partner at Webber Wentzel.

CPAs are regulated under the Communal Property Associations Act, which came into force in 1996 and followed the 1994 Restitution of Land Act.

The 1996 Act stipulates that CPAs need to be run and be operated democratically, with equality among its members encouraged. As institutions, CPAs should be non-discriminatory and have the ability to manage their primary asset - the land - in a way that benefits its members. Furthermore, CPAs have several reporting obligations to meet.

These include submitting annual financial statements and land-related transaction reports to the director general of the Department of Rural Development and Land Reform and maintaining an up-to-date list of its executive committee and broader CPA membership.

However, while CPAs perform a set function within South Africa’s constitutional framework, it is an area that does not arguably receive enough attention from the legal fraternity given its relatively low profile. This is despite the fact that it speaks to the vital topic of land ownership.

Further, CPAs suffer from chronic under-capacity that threatens their viability, which is discussed in more detail below.

Challenges to CPA viability

Some of the chief challenges facing CPAs in South Africa are characterised by a lack of co-operation and compliance, in particular within their executive management or the committees that exist inside a CPA. These bodies often do not follow their own constitutions, and the constitution drafting process is also problematic.

It is often found that one CPA’s constitution is a replica of another CPA, even though one may be located in the agricultural sector and the other in the conservation industry. A copy-and-paste approach ignores key questions around a CPA’s sector business model and means of operation. Ideally, communities in a CPA must hold an active interest in drafting their constitution so that it speaks to their specific needs.

The biggest challenges emerge when committee members or executive officers are elected, who then, in turn, treat a CPA as a sole proprietorship, making decisions on their own even though they should consult with and receive instructions from their members.

Tensions also regularly develop between CPAs and traditional authorities, with chiefs or local leaders regularly claiming that the land should be under their curatorship versus a CPA.

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When committee members are elected, it is usually the most popular or well-resourced individuals that are assigned committee seats, with little regard given to whether these persons have the relevant skills to administer the land under their respective CPA’s purview.

Combined with a lack of resources, facilities, and financial liquidity - a status quo found all too common across South Africa’s constituent CPAs - a vicious cycle can embed itself, stunting the ability of a CPA to become a meaningful and change-making enterprise for its members.

Yet, amid these challenges, CPAs are arguably among the best models for land-owning persons to pursue. They encourage participatory democracy among their members, provide members with equitable access to land, and critically create the opportunity for members to benefit from the land itself.

Whatever financial resources are pulled into a CPA; they trickle down to each beneficiary. If operated efficiently and with care, CPAs can provide their members and the broader communities located in them significant economic benefits that can have positive generational effects.

Making CPAs successful

Given the challenges faced by CPAs and those who manage them, greater consideration should be given to partnering and appointing independent persons with needed expertise. For instance, attorneys can assist CPAs in drafting contracts or helping their elected officials to better understand the implications of the contracts they are signing.

Regarding financial management, accountants can assist CPA leaders to better manage their finances and ensure that whatever resources that may exist in a CPA are accounted for and spent judiciously.

A good example of a CPA that has leveraged the land at its disposal for the betterment of its members and the surrounding community is the Makuleke CPA. Originally from Mozambique, the Makuleke community occupied approximately 23,000 hectares of land around the northern borders of the Kruger National Park.

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The community were later disposed of their land by the apartheid government. Following the end of apartheid, the Makuleke community lodged a land claim in December 1995, with their land having been incorporated into the Kruger National Park by this time.

Extensive negotiations took place between the Kruger National Park, the government and the Makuleke community. A scheme was agreed upon where the Kruger National Park and the Makuleke community would share joint management of the area, transferred to them in 1998 for conservation purposes.

The Makuleke community holds elections for new executive members every five years, with the since-deceased Makuleke chief playing a key role in driving the CPA’s success through democratising its institutions in the community. The Makuleke have the sole right to manage and run hotels, lodges, and game drives on their land, with several concessions granted to tourist companies.

As a result of the money earned over a long period, the area has benefitted from new schools, improved electricity supply, and a high number of job opportunities in an area that typically suffers from chronic unemployment. This is a noble goal for CPAs to pursue.

While the Makuleke benefitted from their geographic position, through careful leadership and leveraging their land, they have created a future for themselves that they own. That is an objective that all CPAs can pursue in earnest and in partnership with willing actors where appropriate.