Beyond the freehold title obsession: generating land tenure security

 

Zimbabwe has a regime of multi-form tenure, with multiple tenure types associated with different areas of land (freehold, lease, permit, communal and state land). This provides a flexibility in tenure arrangements, with each appropriate to different uses. For any form of tenure the overall objective is security but this can be achieved in multiple ways. The form of tenure must balance administrative complexity and cost of establishment (including cadastral survey, registration etc.) with use.

In Zimbabwe the typical post-settler economy pattern persisted following Independence, with large-scale farms retaining freehold, granted to white settlers during colonisation, while former tribal lands became de jure state-owned lands. These communal areas have de facto rights delegated to local communities (including chiefs), under the oversight of rural district councils. Other areas of freehold title were established in the colonial area, such as in ‘purchase areas’, becoming small-scale farming areas after Independence. Other land was designated as state land including parks, forestry areas and state farms. In the 1980s resettlement areas were established under a restrictive permit system, while following 2000, offer letters (later substituted by land permits) and 99 year leases were proposed, with a 25 year concession proposed for wildlife conservancies.

In line with the Land Tenure Commission of 1994, led by Mandi Rukuni, the challenge today is to clarify overlaps and confusions, and to develop a streamlined administrative system with regulatory oversight for all settings. This is a core challenge for the Zimbabwe Land Commission today, 23 years on. The post-2000 land reform has provided this opportunity for A1 and A2 areas, where permit and lease systems are proposed; although for some A2 areas, leases with options to buy and so transfer to freehold title are offered.

In Zimbabwe regulations exist that restrict multiple farm ownership, and stated policy encourages wide distribution of land, avoiding concentration. While issues of multiple farm ownership remain and regulations continue to be flouted, especially by senior politicians (see earlier blog on audits in this series), the principle is well established, and is based on commitments to social justice and the distribution of national productive assets, and is enshrined in the cross-party agreed national Constitution.

In the past, high levels of land concentration have resulted in political tension and inefficient utilisation of land, as well as land speculation. These inequalities, and many of the problems associated with the lack of regulation in ‘white’ freehold tenure areas, were an important impetus for land reform. But redistribution is only one step, ensuring tenure security following land reform is essential. Despite much evidence that investments in land, particularly in small-scale A1 settlements, has not been hampered by lack of clarity on land tenure and those in A1 areas usually regard their land as secure, a more formalised, accepted system is clearly required.

 Seven principles of tenure design

Here are a number of key principles for tenure design drawing on the international literature (and highlighted in an earlier blog). These are:

Democratic accountability to ensure the representation and participation of critical actors (landholders, farmers’ representatives, etc.) in the land administration system tailored to serve the needs of different forms of land tenure. Democratic control of this is afforded through the state having rights to regulate and intervene in land administration in line with national economic development goals.

A flexible market in land – including allowing 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 below), while providing safeguards against land concentration and multiple holdings.

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. Safeguarding against the danger of mass or distress sales of land and rapid speculative land accumulation by local or foreign elites and companies, in times of economic hardship, and the reversal of redistributive gains is critical in the Zimbabwean context.

Facilitation of credit and investment through the provision of land and other assets 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. – see next section). This entails providing clear rules and regulation of farm investment partnerships, and pooled investment initiatives (e.g. cooperation in irrigation, agro-processing infrastructure etc.); and measures which enhance other forms of cooperation.

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 clearly defined and enforceable requirements for joint recognition of land holdings in leases, permits and titles, as well as administrative mechanisms to ensure equitable treatment of gender related land issues. Supporting the application of laws against discrimination, safeguarding women’s succession rights; and the division of rights on divorce (see earlier blog in this series)

A low administrative burden – both in terms of technical complexity and overall cost – of cadastral surveys, land registration and land administration more broadly. This also entails enforcing the levying of reasonable service charges for costly land titling services (e.g. surveying, valuation, registration, etc.), especially for ‘formalising’ leasehold property rights.

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.

Multiple routes to land tenure security

Land tenure arrangements can be assessed against these key principles. Drawing on a discussion note I did with Sam Moyo some years ago (see earlier blog), the table below offers this assessment, based on both Zimbabwean and international experience. 

 

Freehold title Regulated leasehold Permit system Communal/traditional tenure
Democratic accountability to state None Yes Yes Limited
Flexible land markets Yes Yes Yes Informal only

 

Credit and collateral Yes

 

Yes Requires additional instruments for collateral guarantee Requires alternative credit/micro-finance support mechanisms
Regulation against capture No, although potentials for statutory restrictions on sales Yes Yes Limited regulatory reach
Preferential women’s access None Potential lease condition Potential permit condition None: traditional patriarchal biases
Administrative cost Very high High Low None
Revenues and incentives

 

Survey, land registration, title fees/Land tax Lease fees/land tax Permit fee/land tax Limited potentials

A key design principle is around administrative cost, and so delivery, management and efficiency. There is no point in designing a ‘gold standard’ solution if it cannot be implemented. The bizarre obsession in Zimbabwe with freehold title as the only route to land security – spouted at regular intervals by otherwise knowledgeable commentators and politicians – flies in the face of evidence from around the world. In Zimbabwe currently there are serious challenges of delivery, and a full cadastral survey and allocation of title to every plot in the country as some propose would be complete madness, resulting in massive cost, and a huge escalation of disputes that there would be no capacity to resolve. For lawyers and politicians (and some who combine the two) this may seem the neat option, but for anyone who works in farming areas (or has experience of attempts at this elsewhere, then the prospects are scary.

With appropriate design, leases and permits can offer the same security as title but via a different and much cheaper route that allows regulatory control, and they can be especially beneficial when combined with new approaches to financing (see next week’s blog). As with any form of property right, such rights of course must be upheld in law, and not removed at whim, dependent on political favours and patronage relations. But this is a general condition for all tenure arrangements, and with secure leases or permits, under conditions of accountable and non-politicised land administration (not something achieved in Zimbabwe at the moment of course), land security across a multi-form tenure systems should be possible.

Despite announcements on lease and permit systems for A2 and A1 areas, realising these ambitions on the ground remains a challenge. There is a need to assess realistically the scale of the surveying requirement and the cost and sources of funding this (along with compensation arrangements, see earlier blog in this series) in a systematic way. This could probably form part of a phased district land administration reform scheme (see blog in a couple of weeks for more on this). With options for A2 farmers at least to pay for surveying, this will speed up the issuing of leases, and so the refinancing of farms, as well as creating revenue streams to the state through rentals for further surveying. Fiscal sustainability is a crucial factor in the design of any system, and international experience shows that elaborate titling systems are very expensive.

LIMS: land information and management systems, a key piece of the jigsaw

A new land tenure system needs to be linked to an effective and appropriate land information and management system. Again the same principles apply: this needs to be designed with the real world challenges in mind, as a low cost rather than high end perfect system. Certainly, current efforts to re-equip and develop cadastral survey and land registration capacity is welcome. Fortunately today low cost GPS systems with automated computer upload and mapping services are feasible, and there is capacity in Zimbabwe on this (at the University of Zimbabwe, and elsewhere). A land registry that provides open access information on A1, A2 and other land holding types will be an invaluable resource. However, this must not be developed in isolation and separate from field level implementation, as the system must be functional and useable, and able to be supported from recurrent budgets.

While external donor funding is welcome, the land upgrading support should be widened, and a system must be designed and tested at district level with fiscal sustainability in mind. It must ultimately be able to be funded from land rentals, combined with self-payment for surveys. Rentals will thus result in tangible land administration benefits, especially for A2 farmers, as this will release opportunities for financing/mortgaging/loans (although see below), if clear tenure arrangements are established.

For A1 farms much of the land survey and registration work must be regarded as a developmental public intervention, and will have to be financed from the fiscus with donor support, at least for the first one-off permit delivery. Support for permit issuance needs to be done alongside a defined plan for paying compensation, and based upon establishing new financing arrangements. This financing should be seen as a core part of investments for re-gearing the economy.

An effective Land Information and Management System is a necessary part of this, but this needs to be designed and tested with real world conditions in mind. It needs to be low cost and able to remain funded under expected flows of recurrent budget generated from land rentals. However upfront investment is essential to get things started, and to do the initial survey and lease/permit allocation, and this can be seen as one public cost of implementing land reform. Without securing tenure, and creating an environment for financing and investment, then the flows of revenue that will sustain a land administration system will not emerge. The Lands Ministry and Surveyor General will be able to generate revenues from charging for services (including in urban areas), and also will need to set up a system for the systematic collection of rents in order to ensure fiscal sustainability.

Beyond the freehold title obsession

Zimbabwe needs to get over the idea that freehold title is the solution to all ills. Tenure security can emerge through many routes. An effective, transparent land administration and information management system is essential. Rebuilding the bureaucratic state and depoliticising land is essential. The Zimbabwe Land Commission has an important role in this, and one of its major challenges is thinking through a low-cost, replicable and sustainable system to support the delivery of leases and permits on a wide scale across a huge array of land types and sizes, from relatively large A2 farms to very small plots, including those in urban and peri-urban areas.

As discussed in other blogs in this series, and pursued further next week, through some phased district level initiatives it will be possible to integrate lease/permit registration and the development of a functioning land administration and information system, at the same time as dealing with compensation, and new financing arrangements. Getting such pilots moving soon is a major imperative for the new Land Commission.

This post was prepared by Ian Scoones and appeared on Zimbabweland.  It is part of an occasional Zimbabweland blog series on priorities for the new Zimbabwe Land Commission.