Thirty-one years into democracy, South Africa’s land reform programme faces a governance crisis that threatens to undermine the very communities it was designed to empower. Although significant progress has been made in transferring land to previously disadvantaged communities through Communal Property Associations (CPAs), poor governance and compliance failures are preventing these entities from realising their full potential as drivers of rural development and economic transformation.

By Maile Matsimela, Digital Editor at African Farming

Peter Setou, Chief Executive of the Vumelana Advisory Fund, a not-for-profit organisation that helps land reform beneficiaries put their land to productive use, says that as South Africa continues to debate how to make land reform productive, one critical truth stands out: for restituted land to become a source of lasting opportunity, community ownership must go beyond the transfer of land. Setou emphasises that it should include ownership of the processes and decisions that determine how that land is managed, developed and sustained for the benefit of its beneficiaries.

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He quoted the current Communal Property Associations Annual Report, which shows that 82% of 1 700 CPAs fail to submit annual reports within the prescribed time, including key governance documents and returns (e.g. AGM held, current committee, membership list, financials). This, he says, is the fundamental challenge facing CPAs.

Moving from Policy to Practice

“We need to move away from just a conversation on how we can strengthen Communal Property Associations (CPAs) and from policy discussions and put proven methodologies into practice. The challenge is not that we don’t know what needs to be done, it’s actually doing it,” says Setou.

The Role of the Communal Property Associations Amendment Act of 2018

Speaking about the intentions of the Communal Property Associations Amendment Act of 2018, which commenced in 2024 and establishes a CPA Office and a formal Registrar of CPAs to tighten compliance oversight, Setou says, “the intention for an amendment is reasonable and compliance should be enforced. However, what we need as a country is 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.”

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The Complexity of Managing CPAs

According to the Vumelana Advisory Fund, 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.

“In the face of these significant demands, committee members often have limited skills and almost no resources. In addition, the structure of CPAs is quite challenging.”

A Road Map for Effective Compliance

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

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

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Furthermore, Setou advocates for introducing mechanisms such as issuing compliance notices and binding directives for noncompliant CPAs. In addition, there should be periodic inspections to verify CPA practices and implement corrective action and support. The amendment should introduce self-reporting by requiring CPAs to submit annual returns as part of monitoring their own compliance to key and defined regulations.

Leveraging Technology for Better Governance

“If we are to achieve effective compliance to regulations, we need to define compliance KPIs for CPAs and track these. Then, over time, leverage technology by using compliance management software to automate monitoring and data collection,” says Setou.

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

Proven Track Record of Success

Over the past 13 years, Vumelana has worked with more than 50 CPAs across the country. Through its Community Private Partnership (CPP) model, Vumelana has facilitated 26 partnerships between CPAs and private investors, mobilising about R1 billion in investment funds, putting 72 000ha of land to productive use and creating more than 2 500 jobs in the process.

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The Importance of Professional Administration

“Our experience shows that a CPA with the resources to hire an administrator is more likely to develop than those relying on volunteer committee members to handle critical tasks like preparing accounts and keeping records,” shares Setou.

“[Incentives designed to motivate compliance have] worked well with CPAs. A key recommendation is to include ring-fenced funding to reward those CPAs that are excelling in managing their affairs and have effective administrative services, such as preparing annual audited financial statements and convening AGMs, for example. Over the years when Vumelana ran these awards, CPAs were motivated to comply, as they would win cash prizes that would go towards improving the CPA’s operations. Similarly, funding should be provided to [give] institutional support to CPAs using credible entities or advisers.

“It is imperative that compliance is achieved. As a support agency, our experience shows that support without the effective exercise of authority is like pushing on a piece of string. As soon as you stop pushing, progress stops. It is important that support and monitoring are sustained,” concludes Setou.