Whom is Paul Trewhela trying to fool? Nationalisation debate continues.
The article titled "Notes on nationalisation" written by Paul Trewhela is deceptive. Firstly, he deliberately avoided the issue of how aboriginals were historically deprived of their entitlement to natural resources (minerals and petroleum) and secondly how mineral resources ended up in the hands of foreign entities and thirdly, how such deprivation can be undone in the current dispensation. Instead, he used his article to try and shame SACP and YCL and to demonise Marxism-Leninism while singing praise about capitalism. He predicts that if mines are nationalised "health and safety" will be worse and in his effort to infatuate with the mining houses, Paul shun away from discussing the current rate of fatalities in mines which has reached unacceptable proportions ( already more than 200 mine fatalities have been reported in 2009). While land restitution process is underway (albeit at a slow pace) to restore land dispossession that occurred after 1913, there is no similar process to restore mineral rights to the deprived communities. Let us take a brief look at how traditional communities were robbed of their land and mineral resources: Common law position Ownership of the land extended up to the heaven and down to the centre (heart) of the land. So ownership of the land included ownership of minerals contained in the land. Minerals were thus regarded as fruits (fructus) of the land, which could be separated from the land by the owner/s of the land. The minerals therefore became an object capable of being owned separately from the land immediately after extraction from the ground. SA historically adhered to the common law principle "the owner of the land is the owner of sky (air space) above and everything contained in the soil below the surface". Once the mineral is extracted, it becomes movable and forms the subject of separate ownership. This common law principle can only be out done legislatively. With the land dispossession by settlers, blacks did not only lose land but also everything underneath it including minerals and petroleum. This common law principle can only be changed through a Statute and that is what happened in SA. Reservation of rights and entitlements The British Administration of the Cape Colony introduced the practice of granting Crown land to subjects, subject to the reservation of some mineral rights in favour of the Crown. This played a big role in dispossessing aboriginals of their mineral rights or entitlements thereto. The reservation could it either take place by statute or title deed. This reservation can either relates to the entire ownership of unsevered minerals (un-extracted minerals attached to the land), certain mineral rights (precious metal, gold, silver etc) and the entitlements of certain mineral rights. For instance Section 2 of Law 1 of 1883 of the (Zuid-Afrikaansche Republiek) (Transvaal colony) reserved ownership and the right to mine precious stones and precious metals in favour of the State (colonial state). This Law effectively amounted to "expropriation of unsevered minerals" and rendered mineral rights worthless (at least for individuals who previously owned land and unsevered minerals on it). While the above Law reserved unsevered mineral rights to the State, Section 4 of the Proclamation on Conversion of Loan Place Quitrent Tenure in line with English law concept of the Crown prerogative in the Cape Colony reserved Precious Stones, Gold or silver to the Crown. Also to complete the whole picture, the Crown Lands Act 14 of 1878, which provided for the sale of Crown land, reserved the royal prerogative by insisting that the rights to prospective purchasers of the land would not extend to any deposits of gold, silver and precious stones. In Transvaal after the Anglo-Boer war, section 7 (1) of the Crown and Land Disposal Ordinance 57 of 1903 provided that all rights to minerals, mineral products and precious stones on Crown land granted, sold or leased under Ordinance had to be reserved to the Crown. After the discovery of diamonds and gold in 1867 and 1870 (1882) respectively, a plethora of legislation was passed in the four colonies ( Cape colony, Transvaal colony, Orange River colony and the Natal colony). The mining laws in force in the colonies remained in force after the formation of Union of SA in 1910. It is not coincidental but historical that the like of Anglo America, Bhp billiton enjoy monopoly in the mining industry. MPRDA (Mineral and Petroleum Resources Development Act 28 of 2002) On the 12/13 November 1994, the ANC convened a workshop at NUM Training centre that drafted the Mineral and Energy Policy and in October 1998 the Mineral and Mining Policy for SA was adopted which led to the current MPRDA. The MPRDA's potential advancement is constrained by the 1996 class project syndrome. The positive aspects of the MPRDA are that it vested mineral rights which were previously owned by mainly mining houses and small white group to the people of SA and the State remained the custodian thereof. It leases mineral rights to mining companies and the latter will pay state royalties (when Royalty Bill is promulgated) and this will supposedly augment state financial capacity to provide services to the people. However, transformation of mining industry is regrettably limited to existing mining companies acquiring at least 15% (by 2009), 26% (by 2014) BEE equity. This is just elitist as this equity shareholding can be held by one or two black people and the company will be compliance. The current economic meltdown has exposed serious flaws in many BEE transactions as the so called empowered black individuals are heavily indebted to companies or financial institutions. The BEE beneficiaries rely on dividends to service their debts but dividends are declared by Board of Directors, mainly, the empowering companies. When concluding the BEE deals, emphasis was put on "enrichment" as opposed to "empowerment" which entails acquisition of technical and management skills. The Transitional Arrangement of the MPRDA provided mining entities with five years (2004 - 2009) to convert their old order mining rights, two years (2004 - 2006) to convert old order prospecting rights, one year (2004 - 2005) to use their unused old order rights (use it or lose it principle) and companies have done exactly that, so the colonial apartheid position remains unchanged. Conclusion The status quo (quasi-nationalisation of mineral resources) is inadequate and is constrained by the "1996 class project" syndrome but nationalisation has its own constrains given the capitalist character of the state and this will lead to or enhance State Capitalism and I don't think that is what YCL intends. Socialisation of the mines is the only way to go for now, mainly by forcing (legislatively) companies to give equities to local communities (where mining operations take place) and use finance that will accrue for socio-economic development and lessen the local government burden to provide service delivery to a certain extent. This is not without its limitations though. Phumlani Dlamini ________________________________ From: [email protected] [mailto:[email protected]] On Behalf Of [email protected] Sent: 14 July 2009 12:11 PM To: [email protected] Subject: [YCLSA Discussion] Politicsweb article Notes on nationalisation Paul Trewhela unpicks the implications of state control of the mining industry Click here <http://www.politicsweb.co.za/politicsweb/view/politicsweb/en/page72308? oid=136151&sn=Marketingweb%20detail> to read the full story. This article was sent by [email protected] who had the following comments: Comrades, lets further enrich the discussion on Nationalisation of Mines. ###################################################################### Attention: This message is intended for the exclusive use of the named addressees hereof and may contain information that is privileged or confidential or otherwise restricted from disclosure. 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