Monday, 28 April 2014

Land tenure dilemmas in Zimbabwe

A key question for policymakers today is what tenure system makes sense for the new configuration of land, livelihoods and production after land reform? What tenure and land administration arrangements will assure tenure security, encourage investment and boost production?

Unfortunately, much of the debate on this issue starts from ideological assumptions about what is claimed to be the ideal tenure type, rather than the basic principles which should guide the choice of administrative and legal arrangement for ensuring tenure security. Instead it's better to start from defining key principles and move towards a pragmatic assessment of options and trade-offs.

This blog lays out the argument for a multiform tenure approach for Zimbabwe. This is not a new argument at all. Professor Mandi Rukuni and the Presidential Land Tenure Commission of 1994 presented a similar case. Five years ago I prepared a briefing note on land tenure dilemmas in response to the on-going confusion on this topic, drawing on discussions with Sam Moyo, Prosper Matondi and others. I have linked to this in previous blogs. This blog presents a version of it again, as the debate on land tenure continues today with a similar lack of clarity.

Seven key principles
What should be the key features of a new tenure regime? Here are seven principles, drawn from the wider international discussion on the topic:

Democratic accountability to allow for state intervention to shift the configuration of tenure in line with national economic and development goals, in the face of dynamic change in technology or economic conditions and when market mechanisms are insufficient (for example, to facilitate a shift to a large-scale freehold system under conditions of full industrialisation and urbanisation in order to assure national food security)
A flexible market in land – including sales, rentals and leases – to allow trading up and down in land size in line with investment and production capacity and skill (although with regulation by the state – see 4 and 5, below).
Facilitation of credit and investment through the provision of land as mortgaged collateral and the provision of bank credit guaranteed against land, combined with other credit guarantee mechanisms (for example, linked to farm equipment, livestock, buildings, urban assets etc.)
Regulation against capture by elites or speculative investors to avoid inefficient and inequitable consolidation of land holdings and land disenfranchisement, especially of the poor and women (for example, the danger of mass sales and rapid speculative land accumulation by local or foreign elites/companies in times of economic hardship, and the reversal of redistributive gains).
Guarantees of women's access to land, as independent, legally-recognised land holders, with the ability to bequeath, inherit, sell, rent and lease land (for example through requirements for joint recognition of land holdings in leases, permits and titles, as well as administrative mechanisms to ensure equitable treatment of land issues).
A low administrative burden – both in terms of technical complexity and overall cost – of cadastral surveys, land registration and land administration more broadly.
Revenues through survey, title, lease and permit fees and setting incentives to discourage underutilisation through land taxation is an important condition for an effective land tenure regime.
There is broad agreement on the desirability of each of these seven principles, and a wider recognition from international experience of their importance. However, there are more questions about their practicality and feasibility, and the pragmatic trade-offs between each given administrative and technical capacities in land administration.

In Zimbabwe existing legislation allows for a wide range of potential tenure types, ranging from freehold title to regulated leases to permits to communal tenure under 'traditional' systems. All have their pros and cons. Any one or combination can offer a guarantee of secure property rights under particular conditions. There is thus no 'gold standard' or assumed 'evolution' towards an ideal, as is sometimes suggested. Instead, the debate about the appropriate tenure regime must start from principles in context, and draw conclusions about the best way forward from an analysis of the trade-offs between options under the particular circumstances currently pertaining.

For example, policymakers must ask, given the available resources and capacity for land administration, can the appropriate level of tenure security be achieved through lower cost means? Or, given the dangers of rapid land appropriation, what minimal safeguards need to be deployed which do not undermine the capacity of credit and land markets to function? Or, what other legal or financial assurances and coordination mechanisms must be added to ensure that private credit markets function effectively? These are very real dilemmas and are encountered the world over, especially in relatively resource poor settings where capacity is underdeveloped. A debate that is constructed around the false promise of an ideal may actually act to undermine opportunities and stall agricultural growth.

Tenure trade-offs
How do different tenure arrangements perform against these key principles? Table 1 offers a preliminary assessment, based on both Zimbabwean and international experience.

Table 1: Trade-offs in tenure design principles

Freehold titleRegulated leaseholdPermit systemCommunal/traditional tenure
Democratic accountability to stateNoneYesYesLimited
Flexible land marketsYesYesYesInformal only
Credit and collateralYesYesRequires additional instruments for collateral guaranteeRequires alternative credit/micro-finance support mechanisms
Regulation against captureNo, although potentials for statutory restrictions on salesYesYesLimited regulatory reach
Preferential women's accessNonePotential lease conditionPotential permit conditionNone: traditional patriarchal biases
Administrative costVery highHighLowNone
Revenues and incentivesSurvey, land registration, title fees/Land taxLease fees/land taxPermit fee/land taxLimited potentials

Depending on the legal and administrative regime or the interpretation and practice of 'customary' or 'traditional' tenure, for example, there are of course large variations in the reality of different tenure types in practice. But despite such variation there are some common features. Freehold tenure for example is always administratively cumbersome, expensive to implement and reliant on market forces with limited opportunities (assuming the rule of law is adhered to) for state intervention to limit consolidation or shape market incentives. On the other hand, communal, customary or traditional systems have advantages of decentralised operation and low cost, but there are limits on the ability to assure security of tenure through legislative means and a limited regulatory reach of the state.

Of course any tenure regime is only a legal/administrative procedure, and must function in a wider political-social-economic context. The lessons of the past decade show vividly that tenure insecurity does not necessarily derive from the nature of the regime, but from the wider political setting, the capacity to administrate land and the ability to assure a rule of law. When these very basic governance conditions are not in place, then no tenure regime can assure security. Indeed, in 2000 was those with freehold tenure that have been the least secure, and those with communal tenure that have been the most secure.

Ways forward
The new Constitution commits to a reestablishment of transparent administrative procedures, the stamping out of corrupt practices and mechanisms for compensation, all in a secure legal framework. With this essential precondition in place, the discussion on land tenure options can take place more effectively – and in relation to a set of clear principles of the sort outlined earlier.

The big question now, is what makes sense given the current situation, and given available administrative resources and capacity constraints? What tenure regime will help get agriculture moving and investment flowing, and support the new agrarian structure?

With the appropriate regulatory conditions attached as part of revisions of legislation and with a land administration streamlined system developed (neither of which exist to date), the above table suggests that the leasehold and permit systems offer considerable promise for the Zimbabwe situation for the A2 and A1 areas respectively. This would allow for the issuing of leases on surveyed A2 farms (perhaps with varying lengths and conditions to incentivise investment and production) and upgrading ‘offer letters’ in the A1 areas as part of a comprehensive, area-based land registration exercise.

Indeed such solutions reflect international thinking on this issue, where low cost land registration and administration approaches based on leases and permits have been shown to be highly effective in relation to the range of principles identified above. This does not mean that freehold tenure is not an option in some instances, particularly in urban/peri-urban settings. But full freehold does not seem to offer the right combination of features for the present situation for most rural agricultural settings. Such a solution to current tenure dilemmas also does not preclude a reform of communal tenure, perhaps extending versions of the approach developed for the A1 areas to the communal lands over time. As the 1994 Land Tenure Commission argued, hybrid approaches that offer the best of customary, communal tenure arrangements, but with new forms of tenure security offered through legally binding arrangements may be of great importance in such areas.

For now, though, the priority must be the A1 and A2 areas. This represents a substantial area of land, and a considerable number of people/land units, and a core national land asset in need of regularisation. Assuring tenure security in these areas must be the first priority (although the prior step remains addressing the compensation issue of course). This must be driven by a discussion based on clear principles, rather an ideological positioning, and an eye to rapid, effective implementation, rather than inappropriate 'gold standard' ideals.

This post was written by Ian Scoones and originally appeared on Zimbabweland.