Call for stronger Community Property Association governance to make land reform more productive

As South Africa continues to debate how to make land reform more productive, Vumelana Advisory Fund, a non-profit organisation that supports land reform beneficiaries to use their land productively, says stronger governance within community property associations is essential to turn restituted land into a sustainable source of opportunity.

The Community Property Association’s (CPA) annual report shows 82% of the 1,700 CPAs fail to submit annual reports within the prescribed time, including key governance documents and returns, such as AGM held, committee, membership list and financials. This is the fundamental challenge facing CPAs.

The institution believes for restituted land to become a source of lasting opportunity, community ownership must go beyond the transfer of land. It should include ownership of the processes and decisions that determine how the land is managed, developed and sustained for the benefit of its beneficiaries.

Peter Setou, Vumelana Advisory Fund CEO, believes there is a need to move beyond conversations about how to strengthen CPAs and policy discussions and put proven methodologies into practice.

“The challenge is not that we don’t know what needs to be done, it’s doing it,” he said.

Setou said the intentions of the Communal Property Associations Amendment Act, which came into effect in 2024 and established a CPA office and formal registrar of CPAs to strengthen compliance oversight, were reasonable and compliance should be enforced. However, he said the country needs a responsive regulatory approach which includes using a flexible, escalating scale of responses and establishing community advisory boards and forums to encourage dialogue with the regulator.

According to Vumelana, the fundamental challenge facing CPAs is the complexity of managing an entity that faces a mix of political and operational problems. Managing a CPA is akin to running a small country as committees are responsible for a defined territory, must meet a wide range of beneficiary needs and face a membership vote that can wipe out institutional memory.

Setou said the first step towards compliance should be to define and break down the regulations into key steps required for compliance, and to keep compliance simple for CPAs.

“We need to implement capacity building and institutional support to ensure good governance, transparency and accountability. CPAs must have an accredited panel of advisors to assist them,” he said.

Setou advocated for introducing mechanisms such as issuing compliance notices and binding directives for non-compliant CPAs. He believes there should be periodic inspections to verify CPA practices and implement corrective action and support.

“If we are to achieve effective compliance to regulation, we need to define compliance key performance indicators for CPAs and track these. Over time, leverage technology by using compliance management software to automate monitoring and data collection,” he said.

For land reform to succeed, Setou said CPAs need to be well-governed, transparent and have clear mechanisms for benefit sharing and dispute resolution among CPA members.

Over the past 13 years, Vumelana has worked with more than 50 CPAs across the country. Through its community private partnership model, the organisation has facilitated 26 partnerships between CPAs and private investors, mobilising about R1bn in investment funds, putting 72,000 hectares of land to productive use and creating more than 2,500 jobs.

Setou said: “One of the things that has worked well with CPAs are incentives designed to motivate compliance. A key recommendation is to include ring-fenced funding for rewarding CPAs excelling in managing their affairs and have effective administrative services, such as preparing annual audited financial statements and convening AGMs, for example.”

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