View - Repository Home - University of the Western Cape

ResearchReportBakwena ba Mare a Phogole (Klipgat)Community Restitution ClaimSusan Tilley and Ntombizabantu NkazaneBelgische Technische Coöperatie nvCoopération Technique Belge saCOMMISSIONON RESTITUTIONOF LAND RIGHTSDepartment ofLand AffairsSchool of Government, UWC3

Bakwena ba Mare a Phogole (Klipgat) Community Restitution ClaimSusan Tilley and Ntombizabantu NkazanePublished by the Programme for Land and Agrarian Studies, School of Government,University of the Western Cape, Private Bag X17, Bellville 7535, Cape Town, South Africa.Tel: +27 21 959 3733. Fax: +27 21 959 3732. E-mail: plaas@uwc.ac.zaWebsite: www.plaas.org.zaIn collaboration with Department of Land Affairs, Commission on Restitution of Land Rightsand Belgische Technische Coöperatie (BTC)Programme for Land and Agrarian Studies research report no. 28ISBN: 978-1-86808-673-3August 2007All rights reserved. No part of this publication may be reproduced or transmitted, in any formor by any means, without prior permission from the publisher or the authors.Copy editor: Roelien TheronCover photograph: PLAASLayout: Designs4development, info@d4d.co.zaTypeset in Frutiger linotypePrinting: RNK GraphicsCartographer: John Hall

ResearchReportBakwena ba Mare a Phogole (Klipgat)Community Restitution ClaimSusan Tilley and Ntombizabantu NkazaneThis document forms part of a series of reports researched and written by the SustainableDevelopment Consortium, led by Phuhlisani Solutions, on behalf of the Commission on Restitutionof Land Rights and Belgian Technical Cooperation.

Bakwena ba Mare a Phogole (Klipgat) Community Restitution ClaimTable of contentsAcronymsiiExecutive summaryiiiKey features of the Klipgat restorationiv1. Property description – location, physical features and basic services 1Location 1Extent of land area 1Environmental issues 1Basic services 32. History of ownership, dispossession and changes in land use 43. Claim lodgement, verification of members, negotiations and settlement process 5Claim lodgement 5Validation and the gazetting of the claim 5Verification of members 5Negotiations 5Purchase and transfer 6Community profile 6Legal entity, ownership and membership 6The terms and implementation of the Settlement Agreement 94. Post-settlement developments and associated support provision 10Assets 10Business plan and land-use plan 10Mining operations 11Agriculture and other developmental activities 14Proposed activities 14Sources of support 155. Conclusions and strategic issues for consideration 186. Source documents 20Primary sources 20Secondary sources 217. Key informants and contact details 228. Appendix 23i

Bakwena ba Mare a Phogole (Klipgat) Community Restitution ClaimAcronymsABETARCARDFCASPCLCCCPACRLRDLADoHDMEDoALRCNGORDGRLCCSection 42DSDCSPSPGAdult Basic Education and TrainingAgricultural Research CentreAgricultural Rural Development FinanceComprehensive Agricultural Support ProgrammeChief Land Claims CommissionerCommunal Property AssociationCommission on the Restitution of Land RightsDepartment of Land AffairsDepartment of HousingDepartment of Minerals and EnergyDepartment of AgricultureLegal Resources CentreNon-governmental OrganisationRestitution Discretionary GrantRegional Land Claims CommissionSection 42D of the Restitution of Land Rights Act 22 of 1994, as amendedSustainable Development ConsortiumStrategic PartnerSettlement Planning Grantii

Bakwena ba Mare a Phogole (Klipgat) Community Restitution ClaimExecutive summaryThis diagnostic study examines the case of the restorationof the remaining extent of the farm Klipgat 18 IQ, fallingunder the Ventersdorp Local Municipality in the North Westprovince, to the Bakwena ba Mare Phogole communityin July 2000. The restored land of the Klipgat farm isapproximately 873 ha in extent.This report outlines the community’s attempts to developand use the land that has been restored to it in terms of theRestitution of Land Rights Act 22 of 1994 (‘Restitution Act’).It examines the nature and content of the post-settlementsupport received and draws lessons from the community’sexperience that might inform the development of a strategyfor post-settlement support provision by land reforminstitutions and associated agencies.At the outset, the report describes the location and physicalfeatures of the restored land, the history of ownershipand dispossession, and the changes in land use that tookplace in the post-dispossession period. The process of theclaim lodgement, verification, negotiations and settlementare then traced. The developments and support providedduring the post-settlement phase are examined in somedetail.Current activities taking place on the land include:• a lease agreement with a mining company, Etruscan,for the extraction of alluvial diamonds• a piggery that supplies local markets with pork• grazing of 20 cattle and 6 sheep owned by communitymembers• an arts and crafts project established by a group offive women who are making beaded necklaces andearrings• a brick-making project that has supplied bricks tolocal housing projects and has the potential to makesufficient bricks for the proposed housing project onthe farm.The study concludes with an analysis of critical strategicissues, as follows:• The definition of membership is unclear.• Tensions within the communal property association(CPA) are threatening to undermine the progress madeby the community.• Protracted discussions and planning regardingdevelopment activities have taken place. However,these have not been followed through with directaction or implementation, partially as a result ofthe community becoming immobilised by ongoinginternal tensions and a lack of resolution about theway forward, and partially due to a lack of support fromthe Regional Land Claims Commission (RLCC) in theform of grants as well as technical and organisationalsupport.• The community remains unclear about whetherprojects that are established on the farm are to beviewed as communal projects or as the property ofindividuals.• Ownership rights and subsidies regarding housingsettlement on communal land require furtherinvestigation.• The relationship between the mining company, whichhas mineral rights on the community’s land, and theCPA remains an unequal one. In addition, the terms andconditions of the agreement between the two partiesare not well defined or understood by the community.The community is unable to quantify the potentialbenefits that might accrue from their valuable asset.iii

Bakwena ba Mare a Phogole (Klipgat) Community Restitution ClaimKey features of the KlipgatrestorationProvinceNorth WestDate claim lodged 9 July 1996Date settled (Section 42D) 2 April 2001Total settlement amountSize of land awardedType of legal entityR 1,820, 000 (R1.8 million)873 haCommunal property association (CPA)Number of members Approximately 500Developmental activities • A piggery has been developed and is operational.• The CPA receives R6,000 per month from a diamond miningcompany as rental and is supposed to receive interest on itsequity share in the mining business.• A brick-making project has been started.• A group of women have established a bead-making project.iv

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claim1. Property description –location, physical features andbasic servicesThe remaining extent of the farm Klipgat 18 IQ, in the NorthWest province under the jurisdiction of the VentersdorpLocal Municipality, was restored to the Bakwena ba MarePhogole community in July 2000.LocationThe farm Klipgat 18 IQ is located north west of the townof Ventersdorp in the Rustenburg district of the North Westprovince.Extent of land areaThere is a discrepancy across various documents in therecording of the precise extent of the restored land. Thevaluation report (CA Young Valuations 1999) states that theland area is 872.9161 ha in extent. This is in agreement withthe title deed. However, the extent of the land transferredto the CPA, as reflected in the Memorandum: Mandate toNegotiate (2000) and the Agreement of Sale (2001), is872.8060 ha. The Department of Land Affairs (DLA) researchreport on Klipgat No. 18 IQ states that the land area is872.8138 ha.The community has indicated that a number of theirancestors’ graves are located outside the periphery ofthe farm boundary and that they are not clear why theboundary of the restored land excludes these burial sites.The business plan indicates that the cemetery is locatedon Erf 85 (Business Plan 2004). The discrepancy in the landareas as reflected in different documents may account forthe difference of approximately 1,000 m 2 , which area couldrepresent the burial area that lies beyond the perimeterfence. The boundaries of the farm have either not beenclearly demarcated or the entire extent of the claimed landhas not been restored to the community, although the areain question is relatively small.Rainfall, climatic conditions and topographyThe area has warm summers and cold winters with frostduring the winter months. The summer rainfall is between500 mm and 550 mm per year (CA Young Valuations 1999).The farm has undulating grazing lands with soil consistingof sandy loam which is fairly stony. The farm consists of120 ha of dry land; 98 ha of Smutsfinger and erigrostospastures and 654 ha of stony sour grass grazing (CA YoungValuations 1999).According to the business plan (2004), previous surveysindicated that the soil of the farm is of the Msinga soilseries and varies from shallow or stony areas to mediumtextured and freely drained areas. The dominant soil typesare Rensburg and Katspruit, which are not high potentialagricultural soils but can be utilised for cropping if wellmanaged.The area is known for cattle farming as well as drylandcropping with the cultivation of grain, sorghum, maize andpastures being common. The carrying capacity of the landis estimated at 6 ha per large livestock unit.There is a diamond digging on the property that coversapproximately 100 ha, on the eastern boundary.Water supplyThere are seven boreholes on the property but only threeare functioning. One of the boreholes has the capacity topump approximately 10,000 litres of water per hour (CAYoung Valuations 1999).The Mooi River runs through the property and the farm ispart of the Groot Marico irrigation scheme.The diamond diggings on the property draw a high volumeof the farm’s underground water.Environmental issuesNo environmental impact assessment was done prior to thesettlement of the claim.According to the business plan (2004), the followingenvironmental issues need to be taken into consideration:• The mining activities should be monitored andrehabilitation should be done during all stages of themining.• The bloekom (eucalyptus) trees are alien plants thatconsume large quantities of water. It is recommendedthat these trees should be removed.1

Bakwena ba Mare a Phogole (Klipgat) Community Restitution ClaimMap 1. The boundaries of Klipgat 18 IQ2

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claim• It seems that there are no longer any endangeredanimal species on the farm.• The cemetery on Erf 85 should be included in thelayout plan.• A new village should be planned according toappropriate standards. Special detail should be givento the following:• sewerage• water quality for consumption• waste disposal.Basic servicesAll major services are available in Ventersdorp, Rustenburgand Carletonville, each of which is approximately 45 kmfrom the farm. The road to Boons runs through the propertyand serves as a transport link for community members.3

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claim2. History of ownership,dispossession and changes inland useIn 1913, 14 black families bought the farm Klipgat for£1,783. The community held the land in undivided sharesunder title deed 7241/1913. The 14 families were originallysharecroppers in the Vereeniging area and when theybecame aware of the looming promulgation of the NativesLand Act 27 of 1913 (which had the effect of renderingsharecropping unlawful and prohibiting further purchasesof white-owned land by black people) they purchased andmoved to the farm Klipgat, on the advice of their attorneyPixley ka Seme. According to the deed of transfer, the powerof attorney authorising the transfer of Klipgat was signedon 6 May 1913, six weeks prior to the passing of the NativesLand Act on 20 June 1913.The14 owners and their families lived on and worked theland, cultivating dry land crops and grazing livestock.Diamonds were later found on the farm and the communityentered into a contract with a white miner and shared in theprofits of the mining operation. According to a descendantof Nape, one of the original owners, ‘Africans were notallowed to sell or own minerals and so they gave the surfaceand mineral rights concession to a white prospector andlater sold their rights to him.’ 1The income from agricultural production and the miningoperations meant that most community members did nothave to leave the farm in search of employment. At least halfof the farm is arable and was highly fertile and productiveprior to dispossession; the community was said to be selfsufficientin terms of maize and other food, and substantialsurplus produce was sold on various markets. The farm hada school and all community children received a rudimentaryeducation, while others went on to tertiary education andbecame professionals.During the 1960s, the owners of Klipgat received a letterinforming them that only white people were allowed tooccupy land in the area. When the community was firstthreatened with removals, they formed an anti-removalcommittee and obtained assistance from an attorney to acton their behalf.The land was eventually expropriated by the apartheidgovernment in terms of Section 13(2) of the Native Trust andLand Act, 18 of 1936. The forced removal of the residentstook place over a fourteen-year period from 1961 to 1975.The first group of people were forcibly moved to the farmUitkyk in 1961 and were accommodated in military tents.Other members of the community were scattered andwent to Ledig, Modikwe, Ramathlabana, Mathopestad,Johannesburg and other areas on the Reef. In some cases,members of the same family were separated and familylife was disrupted. The community’s traditional supportstructures were destroyed and many people were reducedto poverty.The pressure on the remaining members of the communityto move was intensified and some members agreed tomove to the Groot Marico while others continued to resist.Various agents tried to divide the community and policeraided the farm and arrested and detained members. Oneof the founder members, David Thekiso, was arrested anddied in detention at the Bougroep prison in Potchefstroom.In 1975, Jacob and Elisa Thekiso and their families were thelast members of the community to be forcibly removed.They were dumped in Brits and their livestock was left atKlipgat and not returned to them.The state expropriated the farm in terms of the provisions ofthe Expropriation Act 63 of 1975. A Mr Momberg applied topurchase the farm and bought it on 30 June 1976 from theDepartement Landboukrediet en Grondbesit [Departmentof Agricultural Credit and Land Ownership] for R52,500; Abond was registered against the property.Mr Momberg used the land for grazing cattle, cultivatingmaize and other dryland crops and entered into a contractwith a mining company to undertake diamond prospectingand mining in the eastern section of the farm.1Interview: J. Nape, June 2006.4

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claim3. Claim lodgement, verificationof members, negotiations andsettlement processClaim lodgementThe claimant of the farm Klipgat is the community madeup of the descendants of the 14 original co-owners of thefarm. This grouping of descendants regard themselvesas the Bakwena ba Mare a Phogole community. Havingheard that they could claim their land under the restitutionprogramme, a group of community members contactedother members via word of mouth, radio and print media.A series of meetings was called to discuss the possibilityof claiming the land. It took the group a number of yearsto trace all members of the community and to finalise theclaim for lodgement, which was done with the assistanceof the Legal Resources Centre (LRC). The claim was lodgedon 9 July 1996 and was viewed by the Commission forthe Restitution of Land Rights (CRLR) as complying withthe provisions of Section 10(1) of the Restitution Act, asamended.Validation and the gazetting ofthe claimThe claim was gazetted in terms of notice 2727 of 1998(Government Gazette, 13 November 1998).Verification of membersIn 1998, the Regional Land Claims Commission (RLCC)Research Unit and members of the claimant committeeheld various meetings and embarked upon an exerciseto clarify who they understood to be members of theclaimant community. This was undertaken prior to theadoption of the CPA’s constitution, which details eligibilityfor membership, and which was adopted in April 2001.However, in September 2002, the RLCC indicated that it wasstill going to appoint a service provider to conduct a furtherverification process. 2 According to community respondents,there are 500 members in the claimant group but there arestill differences of opinion regarding how membership isdefined and who exactly the members are. 3NegotiationsOn 2 April 2001, the Minister for Agriculture and LandAffairs approved the request for a mandate to negotiate thepurchase of Klipgat farm for the Bakwena ba Mare a Phogolecommunity in terms of the Restitution Act. The communitywas assisted by the LRC during the negotiations process. TheMandate to Negotiate outlines the status of the claimantcommunity and indicates that the members are descendantsof the 14 original owners. It specifies the particulars of theclaim, describes the property, states the acceptability of theclaim, outlines the history of acquisition and dispossessionof the rights in land being claimed, specifies the financialimplications, and makes recommendations for approval bythe minister.Financial implicationsDuring the negotiations, the then landowner, Mr JohannesChristoffel Momberg, requested that the valuation priceof R855,000 be increased to R950,000 due to the potentialof the mining operations on the property and loss ofpotential earnings. 4 The DLA and the RLCC agreed to paythis increased amount.The DLA agreed to allocate R3,000 per household asRestitution Discretionary Grants (RDGs) and R1,440 perhousehold as Settlement Planning Grants (SPGs). It wasestimated then that the claimant community was made upof 200 households, thus bringing the total grant allocationto R870,000. 5In September 2002, the RLCC acknowledged that it hadyet to appoint a service provider to conduct ‘claimantverification’ (that is, community membership), and thatthis was delaying the disbursement of grants to thecommunity as determined by what is referred to as theDeed of Settlement of March 2002, otherwise known as theSettlement Agreement. 623456Correspondence: RLCC to LRC, 19 September 2002.Interview: CPA interim committee members and community residents on Klipgat farm, July 2006.Memorandum: Submission in terms of Section 42D, April 2001.Memorandum: Submission in terms of Section 42D, April 2001.Correspondence: RLCC to LRC, 19 September 2002.5

Bakwena ba Mare a Phogole (Klipgat) Community Restitution ClaimPurchase and transferThe agreement of sale was signed between the chairpersonof the CPA and the landowner on 18 July 2001, and a handovercelebration was held on 25 July 2001. The purchase date isrecorded on the title deed as being 24 August 2001. 7 Thetitle was registered in the name of the CPA on 11 January2002 (Title deed, T2983/2002).Community profileNo formal skills audit or formal profiling of the communityhas been undertaken to date. The capacity and qualificationsof the community members of Klipgat are diverse, with somemembers being professionals such as doctors and lawyerswhile others are illiterate and work as manual labourers. Themajority of the members are unemployed. A number of themembers have farming skills as a result of having previouslyworked on farms – this was evident amongst workers in thepiggery and those wishing to embark on the poultry project.Some of the CPA committee members are experienced inhuman resource and personnel management, while othershave expertise in the construction industry and are playinga leading role in attempting to establish a housing project.Legal entity, ownership andmembershipEstablishment of the legal entitySeveral meetings were held between the claimantcommunity and a representative from the DLA in orderto decide upon an appropriate legal entity. According tothe LRC attorney involved in assisting the community,establishing a legal entity was a long and difficult process asthere was much disagreement within the community. Thiswas compounded by resistance from some sections of thecommunity to women being members. 8The community chose a CPA as their legal landholdingentity. The signed constitution is not dated, and there isa difference of opinion regarding when the communityadopted the constitution, with some saying this was donein late 2000, while others indicate April 2001. There are alsoallegations that different versions of the constitution wereadopted and/or circulated to the community. 9 The CPA wasregistered as CPA/01/0329/A in April 2001 in terms of theCommunal Property Associations Act 28 of 1996.A community committee was established in 2000 with 14elected members. Each member was supposed to be a directdescendant and representative of one of the 14 originalowners. However, this initial committee was allegedlydominated by representatives from the Ngakane family,with all the positions in the executive held by Ngakanes. Theterm of this committee was to end in April 2004 and a newcommittee was to be elected, but for a range of reasons noelections were held. After a series of general meetings andpressure from the community, a general meeting held on19 June 2005 determined 3 July 2005 as the date for theelection of a new committee. The elections were duly heldand a new committee was elected without any objectionsbeing noted. It was agreed that there would be a transitionperiod to allow for a proper handover from the old to thenew committee.The old committee was to hand over by 16 July 2005 buton this date the members of the old committee indicatedthat they did not recognise the new committee. As a result,a crisis committee was formed and the old (that is, theoriginal) committee was dissolved due to an alleged lackof accountability and financial mismanagement. This crisiscommittee (also referred to as the Concerned Group) wasmade up of appointed members. Elections for a permanentexecutive were due to take place on 6 November 2005. For arange of reasons, this election did not take place.According to members of the crisis committee, meetingsdid not take place regularly, and there are tensions amongstcommittee members and between factions within thecommunity. While a code of conduct was drafted in a bidto establish a mechanism to settle tensions and disputes,it does not appear to have led to an improvement in thesituation. The current committee has attempted to take theCPA forward and holds report-back meetings for those whoare able to attend, but it clearly does not enjoy the supportof all community members. 10In a bid to resolve these and related issues, a meeting washeld between the CPA, the interim management team,representatives from the Moalusi and Ngakane families andRLCC officials on 25 April 2006. During the course of thismeeting, Mr Mothibe from the RLCC office acknowledgedthat a number of errors had occurred in the process of theland claim and that government officials were partially toblame for these problems. Examples of errors included:7Correspondence: RLCC to Department of Minerals and Energy, 22 October 2001.8LRC file notes and personal communication with Kobus Pienaar, 2006.9Correspondence: Bakwena ba Mare a Phogole Crisis Committee/Concerned Group to Mr Lerato Molaudzi, undated.10 Interviews: Interim CPA committee members, June 2006; Correspondence from Bakwena ba Mare a Phogole Crisis Committee/Concerned Group to MsLerato Molaudzi, undated.6

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claim• failure to compile the claimant verification list beforethe land was handed over• absence of plans pertaining to how the land would beused• absence of research to find out the needs of thecommunity, their preferred development options, andso forth• failure to verify the list of 200 households submitted tothe office of the RLCC• failure to resolve the verification of the status of theMoalusi and Ngakane familes. 11The latter issue, as discussed in the meeting of 25 April2006, raises a number of important aspects about howmembership is determined, besides the lack of a thoroughassessment at the time of the claim being lodged. At issueis the transfer of land from one of the original families(Ngakane) to another family (Moalusi) prior to theirdispossession.According to the land transfer document of 28/29 August1913, 14 members bought the farm, which was 1,019morgen (873 ha) in extent. It then lists the members. Asthese members died, their portions were re-registered inthe names of their children or spouses. When the CPA wasestablished in 2001, membership was defined in terms ofdescent from these 14 original purchasers. It has since cometo light, however, that the 1/14 th share of one of the members,Mr William Ngakane, had been sold to Mr Lucas Moalusi in1940. Lucas Moalusi passed away in 1945 and the title deedwas transferred to Lucy Moalusi. The expropriation ordersof 1966 thus reflect the name Moalusi and not Ngakane (asNgakane had already sold out). This would seem to indicatethat the Moalusi family is eligible for 1/14 th share of Klipgat,and the Ngakane family is not (as they were not forciblydispossessed), but this contradicts the CPA constitutionwhich explicitly refers to the 14 original purchasers andmakes no reference to subsequent owners.The fact that this matter was not clarified at the outset iscausing a great deal of tension within the community andhas contributed to the CPA becoming dysfunctional.MembershipClause 8.1 of the constitution indicates that members of theassociation are the families and direct descendants of thosepersons listed in a schedule as an annexure attached to theconstitution. Each person listed in the schedule representsone family and hence one member of the association.Clause 8.3 further notes that applications for membershipby families other than those listed in the schedule shall bemade to the committee which shall submit such applicationsto a general meeting of the CPA which shall decide whetherto accept or reject an applicant.As indicated above, there is a great deal of uncertaintyabout who is a member and how membership is defined.The problem is compounded by the fact that the term‘member’ is used interchangeably to denote the original 14families and the members of the broader (contemporary)community.Rights and duties of membersThe CPA gives members the right to utilise the land forfarming. The members agreed to be guided by principlesof fairness and equity in their allocation of grazing andcultivation rights. The wealthier members of the communitywere at first unhappy with this arrangement because theybelieved that the poorer members would hold back thedevelopment of the land.After much negotiation, thecommunity set aside its differences to work together for thecommon good of the community. 12The following selections taken from the CPA constitutionstate the rights and duties of members:• Every member shall have the right to make improvementsupon plots of land allocated to it; such right is subjectto the obligation of that member, to maintain suchimprovements. (Clause 9.1)• Every member shall have the right of access to the landand other communal facilities and amenities. Includedin the aforementioned, is the right of access to theland for grazing and cultivation purposes, gatheringof firewood or thatching grass, fetching of water andaccess to other assets, resources and projects of theAssociation. (Clause 9.2)The procedures for acquiring these rights are dealtwith in Clause 20 of the constitution which outlines theregistration and allotment of sites, stating that generalmeetings may allocate plots by a simple majority vote tomembers for their exclusive use. The committee may alsomake recommendations to the general meetings of theassociation on the allocation of plots to members. The11 Minutes of meeting dated 25 April 2006.12 LRC file notes and personal communication with Kobus Pienaar, 2006.7

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claimcommittee is required to maintain a register of every familywhich is a member of the association, as well as details ofsites allocated to them. A member may be deleted from thisregister by the committee in the event of his of her death,on the request of a member or on expulsion from the CPA.Section 20 of the constitution also provides details ofentitlements. Clause 20.8 states that:Any member to whom a site has been allocated on theland and which has been duly recorded in the registershall be entitled to the undisturbed use and benefitof the site, subject to the terms and conditions of thisConstitution.Clause 20.9 further states that:The remainder of the land not allocated in terms of thisparagraph shall be utilised for the use and benefit ofthe members as a whole in accordance with the rulesas determined by the Association in general meetingreferred to in paragraph 9.2.While the right to use and access land is enshrined in theCPA constitution, the CPA has yet to develop a land-useplan or business plan that could be of practical use to thecommunity. In the absence of such plans, the potentialexists for land to be allocated in an ad hoc manner andnot in accordance with the most appropriate use of theavailable land areas. To date, the CPA has identified an areaof the farm where housing will be built but plots have notyet been demarcated or allocated to specific members.Representation of community members in general meetingsis set out in Section 9 of the CPA constitution. Clause 9.3states that:All rights of the members shall be exercised subject tothe rules as determined by the Association in generalmeeting from time to time. Any such rules may beamended or rescinded by the Association in generalmeeting.According to Clause 9.5:At general meetings each member 13 shall berepresented by both a male and female person whois part of such member and not less than eighteenyears of age elected by a majority of vote of suchpersons being part of the members who are not lessthan eighteen years of age. Provided that a membermay be represented by a single male or female persononly where such member does not have as a part of it aperson of the other sex of not less than eighteen yearsof age; provided further that if a member has a personas part of it recognised by law as its head such person(not being less than eighteen years of age) and his orher spouse (not being less than eighteen years of age)or senior spouse (not being less than eighteen years ofage) in the case of a polygynous or polygamous union,shall represent such member; provided further thatshould such head and/or his or her spouse and/or hisor her senior spouse (as the case may be) not exist, aperson of the same gender as such non-existent spousenot less than the age of eighteen years being part ofsuch member shall represent the member and if thereis more than one person of such gender being part ofa members the identity of such representative shall bedecided by a majority vote of all such persons beingpart of the members who are not less than eighteenyears of age; provided further that if a member canbe represented by one person only such person shallhave two votes. Representatives shall have the right tovote on any issue independently of each other. Everyrepresentative of a member shall have the right tovote at a general meeting of members in person or byproxy.Clause 9.5 is confusing on numerous levels, and it isnot surprising that the community members who wereinterviewed were unclear as to its meaning and howmembership was defined. Particularly confusing is the factthat the constitution uses the term ‘member’ to describe thedescendants of the previous owners.Clauses 9.6 to 9.8 make provision for the payment of moniesto the CPA. Clause 9.6 states:Every member shall be obliged to pay its share ofany financial commitments of the Association asdetermined by the Association in general meeting.Clause 9.7 states:Every member shall be obliged to pay any levy lawfullyimposed on it by the Association in general meeting.This is further stated in Clause 9.8:Every member shall be obliged to make contributionstowards the maintenance of the land for the commongood.The above three clauses address the issue of paymentsbeing made by members to the CPA. The CPA has the13 For the word ‘member’, read ‘families and direct descendants of those persons listed in a schedule as an annexure attached to the Constitution’ as definedin Clause 8.1.8

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claimpower to determine an annual membership fee in a generalmeeting. Each member has to pay this fee to the treasurer ofthe committee by the end of February each year.Clause 9.10 deals with succession of members:Every member shall maintain its standing as a memberin the event of the death of any such person who inpart constitutes such member. Any future descendentor future spouse of a person who constitutes a membershall become and be regarded as such member forthe purposes of this communal property associationunless such person voluntarily relinquishes the benefitsof such membership.Clause 9.11 states:A member wishing to relinquish the benefits andrights accruing to it by virtue of this constitution, orwhose membership of the Association is terminatedin accordance with this constitution, may disposeof its benefits and rights to a purchaser of its choice,provided that such purchase has been admitted orwill be admitted as a members with the consent of theAssociation in general meeting, and provided that theterms of the sale are disclosed to the Association, andthe Association in general meeting consent to suchsale.Having spelt out the powers and the duties of members,the constitution also allows for a process by which matterscan be raised and resolved within the sub-structures of theCPA. In the event that it is not able to resolve differencesor disputes, the CPA can request the intervention of theDirector-General of the DLA to assist in resolving disputes(Section 24 of the constitution).Termination of membershipClause 10.1 states that:Membership of the Association may only be terminatedon reasonable grounds by the Association in generalmeeting after the matter has been considered at afair hearing by a general meeting of the members ofthe Association at which the member was given anopportunity to present its case in accordance mutatismutandis with paragraphs 17.2 and 17.3.These paragraphs outline the reasons and conditions forthe office of committee members to be terminated andvacated and the procedure for the removal of a committeemember.The terms and implementation ofthe Settlement AgreementCorrespondence between the LRC and the RLCC: North Westdated 19 September 2002 indicates that what is referred toin various correspondence as the ‘Deed of Settlement’ wassigned in March 2002. It would seem that this documentconstitutes the Settlement Agreement. However, a copyof this agreement could not be traced by the RLCC, theDLA, the CPA committee members or the LRC. The RLCCproject officer indicated that the memorandum submissionin terms of Section 42D is the document that is used inthe absence of the Settlement Agreement. 14 The lack of asigned Settlement Agreement would seem to reflect a lackof adequate management of key documents by the RLCCand other parties. In the event of any disagreements ordifferences of opinion, neither the claimant nor the RLCChas a definitive reference point. In addition, there is nolegally binding document that locks various role playersinto the settlement and development process or requiresany party to provide settlement support.The Section 42D memorandum, as signed by the ministeron 2 April 2001, details the financial arrangements forthe settlement. It outlines the purchase price and theRestitution Discretionary Grants and Settlement PlanningGrants to be made available to the claimant. These grants asrecorded in the memorandum have, however, been alteredwith handwritten figures added alongside the typed text atthe time of the document being signed by the minister. Todate, none of these grants have been paid out by the RLCC.14 Personal communication, Molaudzi, August, 2006.9

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claim4. Post-settlement developmentsand associated support provisionAssetsAccording to the pre-land transfer certificate of valuation(CA Young Valuations 2001), the various assets of the farmwere ‘in a similar condition as on the date of valuationon 1 June 1999’ and indicates that no assets had beenstripped from the property.The farm had been fenced and divided into ten large andseven smaller camps by the previous owner but many ofthe fences have since rusted away.The farm has two original farmhouses. One is 282 m 2in extent and the other is 101 m 2 . Five workers’ housesconsisting of a kitchen lounge, four bedrooms, a bathroomand an outside toilet are also on the property, as well as aworkshop and carport.At the time of transfer, there was one main farmhouse withsmaller warehouses for the storage of farming equipment.The farm workers lived in thatched dwellings and anagreement was reached that allowed them to remain onthe farm and required that they assist with the maintenanceof the dwellings and help with the farming operations.Business plan and land-use planThe Section 42D memorandum deals with the proposedland use in Clause 7, stating that the claimant communityintends ‘taking over the farm as an ongoing business as itis with the current landowner, that is farming. Since theyhave opted for resettlement, their plans will however besubstantiated by recommendations of development andagricultural professionals.’A business plan (also referred to as the ‘developmentproposal’) was prepared by the Welwyn-Mhiduve-TlokweConsortium, as appointed by the DLA. It was accepted andapproved by the chairperson of the CPA and was forwardedto the RLCC on 3 May 2004.The plan outlines the intended land uses as being acontinuation of the current activities, namely, drylandcropping and cattle farming. The plan also proposes anumber of new activities including the establishment of apiggery, poultry farming, vegetables, a snake park and anurban housing settlement.The plan indicates that the following activities took placeduring the facilitation process:• meetings with stakeholders• meetings with beneficiaries• identification of issues by means of a detailedquestionnaire• discussion with the committee members of the CPA todetermine the final priorities.The plan specifies the following proposals for economicsustainability:• Agricultural activities (extensive farming):• 120 ha of cultivated fields for growing maize andsunflowers – 4 job opportunities• 508 ha for cattle grazing – 2 job opportunities.To date, the activities listed above have not yet beenestablished, with the exception of some members bringing20 head of cattle and six goats of their own to graze on theproperty.• Agricultural activities (intensive farming):• 5 ha for vegetables – 20 job opportunities• 5 ha for broiler units – 8 job opportunities• 2 ha for pig farming – 2 job opportunities• 2 ha for paprika farming – 34 job opportunities• 5 ha for hydroponic tunnels (vegetables and cutflowers) – 20 job opportunities.Of the above planned activities, only the piggery has beenestablished to date.• Semi-agricultural activities:• 13 ha reptile park (including ‘milking’ of snakes forvenom) and a guesthouse – 8 job opportunities.Community respondents indicated that they were afraidof snakes and that they did not know where the idea for asnake park came from. They also felt that there would notbe enough tourists to come to the park or a guesthouse, inthe event that one was established. 1515 Interviews: Claimant community members resident on the farm, June 2006.10

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claim• Non-agricultural activities (business):• general dealer – 3 job opportunities• tuck shop and restaurant/tavern – 2 jobopportunities• tourist shop at the snake park – 2 job opportunities• butchery – 3 job opportunities.Community members indicated that there may be potentialto establish a butchery for fresh meat but that in the absenceof a freezer or a cooling room, this activity could not expandor be lucrative. Some community members commentedthat they would not like to have a tavern on the premises asalcoholism would become a problem. Others commentedthat the only people who would buy from a generaldealership would be themselves and that it would probablybe cheaper to buy from shops in the nearby town. 16• Non-agricultural activities (light industrial):• sewing• welding• toilet paper factory• candymaking factory• gingerbeer brewery• arts and crafts.It was envisaged that a light industrial centre be constructedto accommodate various activities. These activities wouldcreate 21 job opportunties. Thus far, the arts and craftsproject has been initiated. A group of five women areinvolved and are generating a limited income.In addition, the business plan outlines the housing andvillage layout needs. Seventy erven are planned for thefirst phase and provision is made for another 114 erven inthe second phase. The plan states that an application forrural housing subsidies will be presented to the provincialgovernment (North West Housing Board). According tocommunity members, this application has yet to be made,and the Department of Housing (DoH) (Mafikeng office)was unaware of any such application having been made.Mining operationsAn alluvial diamond gravel run exists in the eastern areaof the Klipgat farm. 17 While mining operations wereestablished on the land prior to restoration, according tothe certificate of valuation (CA Young Valuations 2001), nomining activities took place on the land as from the dateof the initial valuation in 1999. A Heads of Agreement wasthen negotiated and signed on 1 March 2005 betweenEtruscan Diamonds (Pty) Ltd, 18 Basson Delwery CC (nowcalled Gothoma Diggings CC) and the Bakwena ba Marea Phogole CPA once the settlement of the claim had beenconcluded.The CPA are the surface owners of the land on which thediamond diggings are located and Etruscan is the ownerof the mineral rights. Etruscan appointed Basson Delwerycc (Gothoma Diggings cc) as the sole contractor toexplore and mine for alluvial diamonds and to process thediamondiferous gravel on the property. Operations at theKlipgat Diamond Mine recommenced in June 2005 uponEtruscan Diamonds receiving a mining permit under thenew mining legislation. 19Article 2 of the Heads of Agreement states the following:Etruscan will grant the MaPhogole Community a 26%interest 20 in the mineral rights related to the property.The MaPhogole Community will not be required tomake any contribution to costs associated with theKlipgat project and, subject to Article 3, the MaPhogoleCommunity will be entitled to receive 26% of the profitsfrom the Klipgat project after payment of all expensesrelated to the project including operational costs.The operational costs include royalty payments to theexisting royalty beneficiaries under a separate agreement16 Interviews: Claimant community members resident on the farm, June 2006.17 Alluvial diamonds in the Ventersdorp district are found in gravel runs related to palaeo-drainage systems which drained generally from north to south.Mining is by open pit using conventional loading and hauling equipment. The gravel is unconsolidated, thereby allowing for free digging without anyblasting being necessary. The gravel is treated in a conventional pan plant where the material is screened, concentrated (by pans) and then X-ray sorted.The diamonds from the Ventersdorp district typically average one carat in size. Alluvial diamonds, unlike the majority of stones recovered by the largerdiamond companies from kimberlite pipes, retain both their quality and size thus giving them a gemstone grading.18 Etruscan, through its 51% owned subsidiary, Etruscan Diamonds (Pty) Ltd, has been acquiring strategic properties in the Ventersdorp Alluvial DiamondDistrict. Etruscan Diamonds (Pty) Ltd is a Canadian-based company and is owned 75% by Etruscan Diamonds Bermuda Ltd and 25% by Mountain LakeResources, Inc. In turn, Etruscan Diamonds Bermuda Ltd is owned 68.5% by Etruscan Resources, Inc. Etruscan Diamonds presently holds two miningpermits and ten prospecting permits covering approximately 257 km 2 with an additional five prospecting permits under application. Etruscan Diamondshas two mines in the Ventersdorp district, the Klipgat Diamond Mine and Tirisano Diamond Mine. (Information obtained from www.etruscan.com)19 The new Minerals and Energy Laws Act was enacted in 2004. In addition to defining the ownership of and access to mineral rights, it makes provision forthe requirement of a social development plan associated with mining operations. A social development plan is required on submission of an applicationfor a mining licence.20 In accordance with the broad-based socio-economic empowerment charter for the South African mining industry, joint ventures or partnerships arerequired to grant a 25% equity plus one share to the community. (See Appendix for details of the charter.)11

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claimbetween Etruscan and other parties. Payment of the 26% ofprofits to the CPA is to be made on a monthly basis into theCPA’s bank account.Article 3 deals with the payment by the community for just11% of the 26% equity stake, and states as follows:The parties acknowledge that it is the intent of theparties that the MaPhogole community pay fairmarket value for 11% of its 26% interest in the KlipgatProject. In recognition of the challenges faced by theMaPhogole Community in financing the acquisitioncost of the 11% interest, Etruscan has agreed to acceptpayment for the 11% interest from the MaPhogoleCommunity’s share of profits from the Klipgat Project.Specifically, Etruscan and the MaPhogole Communityagree that:a) With respect to the area to initially be minedby Basson as described in Schedule A, theMaPhogole Community shall direct that 50% ofany distribution of profits which the MaPhogoleCommunity would otherwise be entitled toreceive pursuant to Article 2 in respect of its 11%interest in such area will be paid to Etruscan afterBasson has processed 200,000 cubic metres ofgravel from such area;b) With respect to any other areas developed on theProperty, immediately following a bulk samplingon such area:i. Etruscan will conduct a feasibility studyincluding a valuation of the area on a 15% netpresent value basis;ii. Eleven percent of the total amount of thevaluation will be deemed to be the fair marketvalue and purchase price of the 11% equityinterest previously granted by Etruscan to theMaPhogole Community for the area coveredby the valuation (“Purchase Price”);iii. The Purchase Price will be paid by theMaPhogole Community directing that anydistributions of profits which the MaPhogoleCommunity would otherwise be entitled toreceive pursuant to Article 2 in respect ofits 11% interest in such area will be paid toEtruscan until the Purchase Price is paid toEtruscan in full;iv. Should parties not agree upon evaluation, anindependent valuation will be sought by asuitable qualified independent expert.c) The parties herein confirm that reference to equitystake/interest means the following shareholdings:Etruscan 74% and the MaPhogole Community26% of the mineral rights on the Property.In summary, in order to acquire this 26% interest share, theCPA was required to pay market value for 11% (but wouldactually receive 26%). Given that the CPA did not havecapital to purchase the acquisition of these shares, Etruscandeducts the payment for these shares from the CPA’s shareof profits until the purchase price is paid in full. Neither themembers of the CPA nor the general manager of Etruscanwere able to quantify the actual amount of the purchaseprice nor how much the community had paid to date in lieuof its equity share. In addition, the community memberswere not clear about how the share arrangement wasstructured or how much money, if any, they were entitledto receive.Gothoma Diggings, through Etruscan, is to pay the CPA amonthly surface access fee of R6,000 per month (adjusted forinflation) for the duration of the project as from the date ofcommencement. It is unclear how much longer the diggingswill be operating on Klipgat, but the operations managerand general manager indicated that within one to two yearsthe diggings could be exhausted. This will result in a loss ofincome for the community. In addition, the contractor wasrequired to pay R30,000 on the commencement date andan additional R20,000 over a three-month period from thedate of commencement as a ‘boundary violation’ fee.Etruscan is required to keep the CPA apprised of all itsactivities by submitting quarterly reports including detailsof all explorations, financial and mining activities andother such information as the community may reasonablyrequest. The CPA is entitled to go into the mining area inorder to review any and all data and information associatedwith the operations on the property.The benefits that are outlined in the Heads of Agreementdocument and which the community expects include thefollowing:• Support for the brick-making project through theprovision of clay, a by-product of the diggings.• The investigation of a beneficiation pilot project inconsultation with an established diamond cutter andto approach the Department of Minerals and Energyand the Department of Trade and Industry for thesetting up of a beneficiating training institution in anaround the mine/region. (To date this has not takenplace.)• Etruscan is to actively promote employment andadvance the social and economic welfare of thecommunity in a sustainable way through the followinginitiatives:• The hiring of community members to fill positionsbased on capabilities and competence at all levelsof the project.12

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claim• The training of community members to acquirebasic skills to promote their employment in theproject. Five community members were to beemployed in the first month of operation andanother five in the second month. Preference is to begiven to the community on all future employmentopportunities. (A total of five community membershave been employed to date.)• There is to be an increase in the ratio of womenamongst the mine employees, including womenfrom the Klipgat community, and an increase inthe employment of historically disadvantagedSouth Africans at the mine. (One woman from thecommunity is currently employed in the miningoperations.)• Etruscan is to pay R17,000 per month (adjustableannually based on the inflation rate) to the CPA for theduration of the Klipgat project (for as long as Gothomais operating) in order to contribute to the followingfarming projects:• Building materials and wages for the 50-sowpiggery. (Funds have apparently been contributedtowards the piggery but it was not clear to thecommunity members what the exact amountwas.)• A poultry project. (None of the funds from Etruscanhave as yet been directed to the establishment of apoultry project.)• Etruscan committed itself to conduct first-aid trainingfor teachers and day-care workers in the community,in addition to all the mine employees, and to supplyeducational materials to the planned school which isto house 55 learners. Etruscan is to assist in sourcingfinances for the planned school, which was scheduledfor construction in January 2006. (To date, no schoolhas been established and training has only beenconducted for some of those employed in the miningoperations.)• Etruscan agreed to use and pay an agriculturalconsultant to develop and finalise a business plan inconsultation with the community, the municipality,and other spheres of government. (No comprehensivebusiness plan has been developed and the communityhas not had the benefit of an agricultural consultant.)• Etruscan is to assist with the creation of a small loanprogramme by the contractor to sponsor commercialinitiatives involving members of the community.(According to community members, they are unawareof any such loan scheme. They are, however, aware of abursary having been granted to one young communitymember to study at tertiary level. The selection criteriaand procedures for obtaining such a bursary were notclear to the community, but were apparently discussedwith the chairperson.)Under the terms of the operating agreement betweenGothoma and Etruscan, Gothoma pays all production costsand is entitled to receive a percentage of total sales revenuefrom diamonds mined from the Klipgat mine ranging from70% to 85%, depending on the value of diamond sales ineach quarter. The agreement is effective for the term of theKlipgat mining permit. During the period 23 June 2005 to30 November 2005, in excess of 5,600 carats were recoveredfrom the Klipgat operation at an average grade of 2.02carats 100 m 3 . From 1 December 2005 to 28 February 2006,in excess of 1,900 carats were recovered from the Klipgatoperation at an average grade of 1.64 carats per hundredcubic meters. Diamond sales from the Klipgat DiamondMine to 30 November 2005 averaged US$454 per carat andUS$448 for the first quarter in 2006. 21According to Etruscan’s news report of 6 December 2005,its alluvial diamond production for the three month periodfrom September to November 2005 yielded a total of2,858.32 carats recovered, and sales of 2,925.37 carats withan average price of US$411.42 per carat. The total sales forthis three-month period therefore stood at approximatelyUS$1,203,555 (a minimum of R7 million).Based on the Bakwena community’s 26% interest share,the community was due to receive an amount after theoperating and production costs and less its payments forthe purchase of the shares. The CPA was, however, unableto confirm the amount of money it had received and iscurrently attempting to clarify its financial status and theincome received with the auditor appointed by the previousCPA committee. 22According to the CPA’s business plan:Seeing that the mining company already assisted thebeneficiaries with certain projects and due of goodrelationship with the mining company, no detailedinvestigation was necessary. The following suggestions21 Information obtained from Etruscan website, www.etruscan.com/s/SouthAfrica.asp22 The committee is unable to trace the auditor and scheduled meetings have not been attended by the auditor. The arrangement with the auditor formspart of the current dispute between different groupings within the CPA and the community.13

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claimwere made to get compensation from the miningcompany:• The mining company should hire beneficiaries aslabourers.• The mining company should assist with orprovide grants for agricultural projects, businessdevelopment, capacity building and housingprojects (Business Plan 2004:14).The attitude expressed in the business plan would seemto suggest that the community was operating on the basisof good faith and that it trusted that the mining companywould deal fairly with them and safeguard their interests.The lack of clarity and an inadequate formalised agreementbetween the parties leave the community in a potentiallyvulnerable position regarding benefits from its major asset.Agriculture and otherdevelopmental activitiesThe piggeryMembers of the community have established a piggery onthe farm. There are currently 27 landrace sows, 3 boars andapproximately 40 piglets. Weaners are sold locally.The funds to establish the piggery were drawn fromEtruscan’s social development allocation from the miningoperation. However, the piggery is still in need of heating forthe newborn piglets and additional buildings are requiredas well as the renovation of the existing sties.Livestock grazingIndividual community members have access to grazing,which is currently being used for 20 cattle and 6 sheep. Whilethe CPA constitution outlines that members are entitled tograzing rights, these rights have not been practically appliedor formalised and there are as yet no guidelines detailinghow rights are determined or to whom they are granted.The current grazing rights are informal.Arts and crafts – Bead projectA group of five women have established a bead-makingproject with the support of funds for training from GothomaDiggings CC. They have undergone basic and intermediatetraining courses and are producing bead necklaces andearrings which they market at various tourist centres andlodges in the North West province. The beads are bought inbulk from a supplier in Johannesburg. The project currentlyuses the garage adjacent to the farmhouse as a workshopand display area.In addition, the women are exploring and learning a numberof different crafts. The mining company has sponsored aglass-cutting machine and the women are also makinglamp stands and intend using recycled glass bottles to makedrinking glasses, candleholders and other items for sale.Brick-making projectGothoma Diggings CC purchased a brick-making machinefor the community and a group of community membershave been trained in brick-making. The project has thepotential to produce over one thousand bricks per day. Ithas supplied the Bakubung restitution claim with bricksand will be able to supply the Klipgat community once theintended housing project gets under way. The project hasalready built a row of single quarters for workers on thefarm.Proposed activitiesSettlementThere are currently 12 families residing on the farm(approximately 31 people). Due to the lack of accommodation,in some instances three families share onehouse.The intention is that the CPA will provide housing for 70families over the short term and potentially for 130 familiesin the long term. 23 A portion of the land has been identifiedfor housing development.Some members have grown impatient waiting for housing,and at one stage indicated that they wished to build theirown houses on the land. This was, however, opposed bythe CPA and attempts are being made to speed up theplanning for housing provision. The CPA is making contactwith the DoH to better understand the People’s HousingProcess and the various subsidies that the communitycould access. Confusion exists about whether communitymembers will have individual ownership of the houses builton communal land. Various options are being considered,including a common title deed for Klipgat with sectionaltitle ownership for members. The CPA would thus remainthe owner of the land while members would own theirindividual homes. However, not all the members wouldqualify for housing subsidies because they earn above thesubsidy eligibility level. Additional information is necessary23 Business plan (2004); Interviews: Members, June 2006.14

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claimand a more decisive support intervention from the DoH isrequired.According to a member of the CPA Committee, many of themembers are elderly and do not necessarily want to returnto Klipgat because they are comfortable where they are,being closer to the facilities which they require. 24 This willserve to reduce the pressure on providing housing for allmembers.In addition, the mine provides prefabricated housing forcommunity members who work at the diamond diggings.This accommodation will not, however, be available oncethe mining operations close down.PoultryA group of women are keen to establish a poultry project.They have experience in chicken farming but still requirefunding for building a poultry house and the initial outlayfor the project.Vegetable gardenThe CPA submitted a business plan for the establishmentof a community vegetable garden but this has yet to beassessed by the Department of Agriculture. However,during the week of the research site visit, the Department ofHealth visited the farm and requested that the communityestablish a vegetable garden within two weeks as theMinister of Health was to be paying a visit to the farm.The community were confused and frustrated by this visitand the fact that no sustainable development was beingencouraged or supported.LiteracyA member of the CPA committee outlined the need formother-tongue adult basic education and training (ABET).She is busy investigating various options for ABET classesto be held.Electricity supplyMembers of the CPA highlighted the difficulties experiencedwith the current electricity service and supply. The electricitysupply to buildings accommodating some of the membersis linked to the supply for the piggery but there is only onecard meter. The residents intend separating the meteringand payment of their domestic electricity supply from thatused by the piggery.Residents on the farm are required to buy electricity fromCarletonville. Due to the recent municipal demarcationsand the protest action in this regard, Klipgat residentswere forced to buy electricity from one specific supplier inKhutsong. Travel costs to this supplier almost doubled thecost of their electricity.The community has experienced difficulties in obtainingsupport from Eskom regarding improving their currentelectricity supply.Sources of supportSupport from the Legal Resources CentreThe claimant community was supported and represented bythe LRC during the initial process of lodging and gazettingthe claim and during the process of settlement. The LRCalso supported the community thereafter by following upwith the RLCC regarding the non-inclusion of agreed-upongrant allocations in the Settlement Agreement and thefulfilment of aspects of the Settlement Agreement, such asthe disbursement of grants to the CPA. 25Support from the Regional Land ClaimsCommissionCorrespondence from the RLCC: North West to the LRC,representing the Klipgat community, shows that in 2002 theclaimant had yet not received any post-settlement supportin the form of grants. This indicates that it could not disbursethese grants as the exact number of beneficiaries had notyet been verified. The RLCC had not, at the time, appointeda service provider to conduct the beneficiary verificationprocess. To date, members of the claimant community havenot received grant funding from the RLCC.The project officer at the office of the RLCC has morerecently been instrumental in linking the community withother potential providers of support, more specificallythe Department of Agriculture and the local municipality.The project officer has secured financing from the RLCC’sRDG budget to purchase a vehicle for the CPA at a costof R100,000. The vehicle is due to be delivered in thenear future. The project officer has drawn up a transportpolicy document to guide the community in the use andmaintenance of the vehicle.Support from the Department of Minerals andEnergyAccording to members of the interim CPA committee, theDepartment of Minerals and Energy (DME) has played a24 Interview: J. Nape, June 2006.25 LRC Correspondence: LRC to RLCC: North West, 19 December 2000.15

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claimnegligible role in providing information or support to theclaimant community.Interviews with the DME regarding Klipgat revealed alack of understanding of the terms and conditions of themining contract; the benefits that would accrue to thecommunity; the current status and projected time frame ofthe mining operation; and the time frame and conditionsof the rehabilitation process once mining operations haveceased. 26It would seem that the contract between the initial CPAcommittee and the mining contractor was not overseen bythe DME, and the DME apparently made no interventions toprotect the interests of the community. 27A number of the current tensions that exist within thecommunity pertain to the arrangements regarding themining contract. In particular, it is alleged that the originalcommittee entered into a contract with the miningcontractor without any monitoring of the mining operations,and the committee refused to share copies of the contractwith the community. 28The Assistant Director: Mineral Laws at the DME indicatedthat the existing signed contract between the communityand the contractor contained a number of critical gaps andcould not be viewed as a fair or complete contract. 29Support from the Department of AgricultureThe Department of Agriculture confirmed that the Klipgatbusiness plan for a 20-sow unit piggery and vegetablegarden had been submitted in October 2005 but that itlacked sufficient financial analysis and had been reworked.There is a large backlog of business plans still to be processed,reportedly due to a lack of capacity within the department(there are four economists and financial advisors withinthe department’s North West office). 30 The Department ofAgriculture has committed itself to providing training andtechnical support to the community once the plan hasbeen approved.According to the divisional manager for the PotchefstroomLocal Development Centre of the Department ofAgriculture, the department assisted the Klipgat CPA bydeveloping a proposal for crop production. It was given tothe RLCC project officer at the time but nothing came of itthereafter. 31In addition, the divisional manager highlighted thedepartment’s concern with unsustainable developmentswhich are encouraged by other agencies or governmentdepartments but for which no training or sustained supportis provided. He cited the case of the Department of Health’spromotion of a vegetable garden saying:The communication lines are not open, especiallybetween the Department of Health and theDepartment of Agriculture. The Department of SocialDevelopment gives money for projects but then leavesthe responsibility for maintaining and sustaining theproject with the Department of Agriculture. We end uppicking up the problems, without having been includedin the initial process of setting up projects. You can’tjust throw money at communities and expect thatthey can fly with a project.A concern was raised by the divisional manager regardingthe late stage at which the Department of Agriculture wasbrought into the restitution settlement processes:The department should be brought in right from thebeginning. At the moment we are brought in too late.We are sometimes requested to do feasibility reportsbut then there’s silence for a long time and the landgets bought and yet lots more should be happening inbetween and during these steps. In addition, farms canget vandalised in between the step after the farmerleaves and before the community moves onto theland. 3226 Interviews: DME officials, June 2006.27 Interview: Interim CPA committee members, June 2006.28 Correspondence: Bakwena ba Mare a Phogole Crisis Committee to Ms Lerato Molaudzi, undated.29 Interview: R. Mandiwana, June 2006.30 The North West office of the Department of Agriculture has at least 23 business plans that require assessment and processing.31 Interview: J. Swanepoel, June 2006.32 Interview: J. Swanepoel, June 2006.16

Bakwena ba Mare a Phogole (Klipgat) Community Restitution ClaimThe Department of Agriculture has various funds that it candraw on for supporting restitution projects. These includethe Post-settlement Fund which can be used to purchaseinputs such as seeds; a Poverty Alleviation Fund which is runin conjunction with the Department of Social Developmentand includes starter packs for establishing poultry orvegetable projects; the Provincial Infrastructure Grant; theComprehensive Agriculture Support Programme to beused for infrastructure developments; the government TopupFund for providing support to communities (and whichreceives a contribution from the Department of Provincialand Local Government) which can be accessed for inputsand movable assets; and the Letseme la Mantsha Tlala (Foodfor the Nation) Project which addresses household foodsecurity through providing starter packs for chicken andvegetable projects. To date, none of these funds have beenaccessed by the Bakwena ba Mare a Phogole community.Support from the municipalityThe RLCC: North West wrote to the Rustenburg Municipalityinviting them to attend a CPA meeting on 26 October 2001 inorder to discuss the resettlement needs of the community. 33Various meetings have been held with the municipality,including the Ventersdorp Local Municipality.The Klipgat farm features in the Ventersdorp Municipality’sintegrated development plan (IDP) and the IDP managerhas shown interest in the development of activities on thefarm, but as yet, none of the projects that are listed havereceived tangible financial or technical support from themunicipality or other identified agencies.The intention of the IDP manager is to ensure that thecommunity is put in touch with the relevant serviceproviders if the municipality cannot assist them directly. Themunicipality’s monthly cluster meetings involving variousgovernment departments have enabled the municipalityto raise the needs of different communities, including thoseof the Bakwena ba Mare a Phogole community, and tofacilitate contact as necessary.The IDP manager in the Ventersdorp Municipality indicatedthat the municipality viewed itself as having a duty tosupport the activities of the community at Klipgat:Because Klipgat is a restitution project, we have toprovide to the community and fulfil our responsibility.Our role as government is to provide basic services. Thegrants the communities get are not sufficient. Afterwe have completed the process of fomalising ruralvillages, we want to engage with the People’s HousingProcess for Klipgat. Right now, all the Departmentof Agriculture’s proposed projects are with the bidcommittee for selection but we have supported themthroughout. 34She went on to say that the municipality could assist Klipgatwith water tanks for the vegetable garden as a temporarymeasure and is planning to construct storm-water channelsduring the next financial year.A member of the CPA committee indicated that they findit difficult to see which government department is fundingwhat within the IDP. They have proposed that the IDPshould give details regarding the different kinds of supportprovided and the source of the funding for these. 35Support from the Department of HealthBesides the recent visit from the Department of Healthregarding the establishment of a vegetable garden, thedepartment’s mobile clinic visits the area from time totime. Interviewees indicated that the mobile clinic does notalways come on the days as scheduled and sometimes doesnot come at all. This has serious consequences for peoplewho rely on the clinic for their medication supplies.Support from the Department of HousingTo date, the DoH has been approached for informationregarding the various housing subsidies but, according tomembers of the community, has not shown interest in thedevelopment of housing on the farm.In summary, there are a number of service providersand agencies that are aware of the Klipgat community’sdevelopment needs. While some have engaged with thecommunity and encouraged them regarding their variousdevelopmental aims, little concrete or sustained supporthas been provided to date. The bulk of the financial andtraining support received thus far has come from the miningoperations on the farm. Most importantly, no agency istaking responsibility for supporting the community in thepost-settlement phase, or systematically following up withgovernment agencies to ensure that the expected benefitsand services are actually delivered.33 Correspondence: RLCC with Rustenburg Local Municipality, 22 October 2001.34 Interview: M. Matuba, June 2006.35 Interview: M. Linchwe, June 2006.17

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claim5. Conclusions and strategicissues for considerationKlipgat is a claim with considerable potential in terms ofagriculture, residential development and mineral resources.In all areas, however, the potential benefits are eitherfailing to materialise at all or remain at a level much lowerthan might be expected. Agricultural development onthe restored land is slow and uncoordinated and housingdevelopment is not moving, while the community hasbeen left on its own to attempt to obtain some benefitsfrom the valuable diamond resources on its property. TheCPA, the key institution representing the community, lacksthe external support necessary to function effectively, andmembers are largely in the dark as to the various processesgoing on around them. While the local municipality andgovernment departments, such as Agriculture, appearsympathetic to the needs of the claimants, there is a lackof coordination between agencies and a general failure toengage effectively with the claimant community. Many ofthese problems can be linked to the lack of overall supportfrom the RLCC, which might be expected to ensure effectiveplanning for post-settlement, to coordinate implementation,to support the CPA and to ensure that the necessary supportfrom a range of agencies is actually secured and deliveredat the appropriate time. This in turn can be related to a lackof effective planning by the RLCC to carry out this functionitself, and its failure to appoint any other agency that mightcarry out such vital functions.It is proposed that the following issues require considerationand act as strategic pointers for restitution claims of a similarnature:• The definition of membership remains unclear.While membership is defined in the CPA constitution,the application of this definition remains confusing tothe community, and needs to be resolved.• Tensions within the CPA are threatening toundermine the progress made by the community.As a result of significant issues not having beenaddressed during the early stage of the settlementand planning process, a number of issues have beenallowed to fester and are contributing to a great dealof tension within the community. Comprehensiveinstitutional support to the CPA is required.• Discussions and planning have taken place buthave not been followed through with action. While agreat deal of preliminary work has been done in termsof developing proposals and business plans, very littlehas actually come to fruition. Some of the reasons forthis are the dysfunctional nature of the CPA committee,a lack of capacity in various government departments,poor coordination between agencies, and the lack ofsocial cohesion within the community, partially as aresult of many of the members living some distanceaway from the farm and not being integrally involvedin its activities. Equally important, however, is the lackof any specific agency to drive the process and supportthe community.• The relationship between the mining company,which has mineral rights on the community’s land,and the CPA remains an unequal one. In addition,the terms and conditions of the agreement betweenthe two parties are not well defined or understoodby the community. The current agreement and theoperations of the mining company have the potentialof leaving the community in a very vulnerable andexploited position. This requires intervention fromthe DME. In addition, it remains unclear whether thecommunity is entitled to compensation for the mineralrights it lost as a result of dispossession and/or whetherthe community would have been entitled to apply fora mining licence in their own right. The changes inthe Minerals and Energy Laws Amendment Act 11 of2005 regarding the ownership of mineral wealth as anasset of the state rather than that of the landowner,may have implications for the community, but theseremain unclear. The community is unable to quantifyor realise the potential benefits that might accrue fromtheir valuable asset. There is no systematic monitoringof the agreement, and the CPA lacks the legal andcommercial support services necessary to advanceits interests. For the community to have entered intosuch a complex, and potentially valuable, arrangementof this sort with so little understanding of the process,and so little support from agencies such as the RLCCand the DME, is a cause for serious concern, and stillneeds to be addressed.• The community remains unclear about whetherprojects that are established on the farm are tobe viewed as communal projects or as individualprojects. While there is general consensus that thecommunal operations of the farm should not beprivatised, there are also those who propose that thecontributions made by individual members need to18

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claimbe acknowledged. The piggery is run as a communalproject, but those who participate in it indicate thatthey work hard on the project while others who arenot involved stand to benefit from it. Likewise, thediscussions around establishing a poultry projectappear fraught with differences of opinion as to whetherit will be a project set up by a group of individuals fortheir own benefit, or as a communal project providingemployment to a group or members. These differencesof opinion point to a lack of clarity regarding therules of ownership and how the rights of individualmembers are vested. While the constitution outlinesrights to assets and facilities on the farm, there is noclarity regarding whether a project set up by a groupof residents on the farm using funds gained from thecollective should be regarded as a community-ownedproject for the benefit of the broader community orfor the sole benefit of those individuals working in theproject. Basic information on the legal definition of acommunity claim, and the business options open tomembers, need to be fully understood by RLCC staffand clearly communicated to community members.• Housing settlement on communal land requiresfurther investigation. The community remainsconfused about the housing ownership rights ofindividuals who access subsidies for the constructionof houses on communally-owned land. The servicingof such a housing settlement by the municipality alsoremains unclear to the community. Further intensiveinvolvement of the DoH and of the municipalitywill be required to establish the status of housingdevelopments on the land.• Material benefits have been slow to accrue tothe community, and no clear plans are in placefor the management of financial resources.The implementation of the Klipgat settlement hasdragged out over many years, and yet benefits havebeen extremely slow to accrue to the community.Restitution grants promised to the community haveyet to be paid out, and there remains confusion (withinthe community and, seemingly, within the RLCC), asto the total value of such grants and the timetablefor payment. Substantial benefits might be expectedfrom the diamond mine on the community’s land,but it could not be established how much revenuehas already flowed to the community, what hashappened to this revenue, and how much more isowed. Furthermore, no effective planning has beenundertaken for the use of such revenue when it doesmaterialise. The Klipgat community is clearly in needof professional support in its financial dealings, and itmight be expected that this would be provided as partof a comprehensive settlement agreement.19

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claim6. Source documentsPrimary sourcesReports, minutes and documentsAgreement of sale entered into between Bakwena ba Marea Phogole, the 14 represented by chairperson of the CPAand Johannes Christoffel Momberg. 18 July 2001. (As foundin the RLCC: North West Klipgat Project File).Business plan and development framework for the Klipgatbeneficiaries. 2004. Development proposal compiled byWelwyn-Mhiduve-Tlokwe Consortium. (As found in theRLCC: North West Klipgat Project File).CA Young Valuations. 1999. Valuation report farm Klipgat 18IQ. 1 June. (As found in the RLCC: North West Klipgat ProjectFile).CA Young Valuations. 2001. Klipgat Certificate of Valuation.14 November. (As found in the RLCC: North West KlipgatProject File).Deed of sale made and entered into by and betweenJohannes Christoffel Momberg and the Klipgat CommunalProperty Association. Unsigned and undated. (As found inthe RLCC: North West Klipgat Project File).Deed of transfer number 7241/1918. (As found in the RLCC:North West Klipgat Project File).Deed of transfer number 7249/1918. (As found in the RLCC:North West Klipgat Project File).Deed of transfer number 27876/1966. (As found in the RLCC:North West Klipgat Project File).Deed of transfer number 23273/1945. (As found in the RLCC:North West Klipgat Project File).Department of Land Affairs. Directorate: Restitution.Undated. Research report Klipgat 18 IQ. (As found in theRLCC: North West Klipgat Project File).Department of Regional and Land Affairs. 1994. Eis vanBakwena ba Mare a Phogole: Gedeelte van die plaas Klipgat18 IQ. 9 June. (As found in the RLCC: North West KlipgatProject File).Government Gazette. 12 May 1995. Notice No. 16407.Government Gazette. 13 November 1998. Notice 2727 of1998.Heads of agreement entered into by and between EtruscanDiamonds (Pty) Ltd, represented by Kevin Macneill, Bakwenaba Mare a Phogole community, represented by Rev. MauriceNgakane, and Basson Delwery CC, represented by HendrikBasson. 1 March 2005.Memorandum: Aansoek om herstel van eiendomsreg vir dierestant van Klipgat 18 IQ. 23 August 1993. (As found in theRLCC: North West Klipgat Project File).Memorandum: Advisory Commission on Land Allocation.7 April 1993. (As found in the RLCC: North West KlipgatProject File).Memorandum: Department of Regional and Land Affairs.14 June 1994. (As found in the RLCC: North West KlipgatProject File).Memorandum: Klipgat draft pre-Gazette report. 23 July 1998.(As found in the RLCC: North West Klipgat Project File).Memorandum: Mandate to negotiate in terms of theRestitution of Land Rights Act, 1994. 2000. (As found in theRLCC: North West Klipgat Project File).Memorandum: Submission in terms of Section 42D of theRestitution of Land Rights Act 22 of 1994, as amended. (Asfound in the RLCC: North West Klipgat Project File).Minutes of the meeting held between Bakwena ba Marea Phogole CPA, Bakwena ba Mare a Phogole managementteam, Moalusi/Ngakane family representatives and theRLCC officials at the A14 Klipgat farm. 25 April 2006.Offer to purchase which constitutes deed of sale made andentered into by and between Johannes Christoffel Mombergand the Department of Land Affairs. Unsigned and undated.(As found in the RLCC: North West Klipgat Project File).Pre-gazetting research report. Undated. (As found in theRLCC: North West Klipgat Project File).Regional Land Claims Commission. Undated. Status reportfor remaining extent of Klipgat land claim (As found in theRLCC: North West Klipgat Project File).Resolution of the Bakwena ba Mare a Phogole community.Undated. (As found in the RLCC: North West Klipgat ProjectFile).20

Bakwena ba Mare a Phogole (Klipgat) Community Restitution ClaimResolution of the direct descendants of the co-owners:Klipgat No. 18 IQ Ventersdorp district. 30 August 1998. (Asfound in the RLCC: North West Klipgat Project File).Restoration profile. Undated. (As found in the RLCC: NorthWest Klipgat Project File).Ventersdorp Local Municipality. Summary of IDP priorityissues on the municipal IDP. (Available from VentersdorpLocal Municipality offices, Ventersdorp).CorrespondenceNote: All correspondence was found in the RLCC: NorthWest, Klipgat Project File.Correspondence: Bakwena ba Mare a Phogole CrisisCommittee/Concerned Group to Ms Lerato Molaudzi.Undated.Correspondence: Hans Gouws Attorneys to RLCC.14 November 2000. Re: Klipgat 18 IQ restitution claim.Correspondence: Hans Gouws Attorneys to RLCC.1 December 2000. Re: Klipgat 18 IQ restitution claim.Correspondence: Legal Resources Centre to RLCC.19 December 2000. Re: Klipgat 18 IQ communal PropertyAssociation and memorandum of agreement.Correspondence: Legal Resources Centre to RLCC. 25 January2001. Re: Klipgat 18 IQ Communal Property Association andmemorandum of agreement in terms of Act 22 of 1994.Correspondence: Legal Resources Centre file notes andpersonal communication with Kobus Pienaar. August 2006.Correspondence: RLCC to Department of Minerals andEnergy. 22 October 2001. Re: Bakwena ba Mare a PhogoleKlipgat 18 IQ restitution claim.Correspondence: RLCC to Hans Gouws Attorneys. 8 February2001. Re: Klipgat 18 IQ restitution claim.Correspondence: RLCC to Legal Resources Centre. 19September 2002. Re: Post-settlement development of thefarm Klipgat 18 IQ.Correspondence: RLCC to Rustenburg Local Municipality. 22October 2001. Re: Bakwena ba Mare a Phogole Klipgat 18 IQrestitution claim.Secondary sourcesCommunity Agency for Social Enquiry (CASE). 2005. Reporton the Klipgat restitution project.Council for Scientific and Industrial Research (CSIR). 2005.CPI Review. 29 April.Etruscan Resources, Inc. 2006. Social programs. http://www.etruscan.com/s/SocialProgram.asp?ReportID=102185&_Title=South-AfricaEtruscan Resources, Inc. 2006. South Africa. http://www.etruscan.com/s/SouthAfrica.aspMountain Lake Resources Press Releases. 2005. Etruscan getsgreen light to develop second alluvial diamond concession,South Africa. http:/www.mountain-lake.com/pr/062305.htmCorrespondence: RLCC to CA Young Valuations. 7 November2001. Re: Pre-land transfer valuation certificate.21

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claim7. Key informants and contactdetailsLerato Molaudzi (RLCC: North West, Project Officer for Klipgat) 018 39230800824183365LLMolaudzi@dla.gov.zaMaropene Makwala (National Department of Agriculture) 018 2975798Sipho Mosegedi (Department of Agriculture, Extension Officer – Crops) 018 2643010Wlliam Ralokwakweng (Department of Agriculture, Extension Officer– Vegetables)018 2643010Meokgo Matuba (IDP manager, Ventersdorp Municipality) 018 2642051Sophy Thekiso (Member (Poultry project))Selina Malefetse (Member (Bead work project))0727432780Resident on the farmResident on the farmMartha Linchwe (CPA committee member) 0822996830Frans Thekiso (Community member)Resident on the farmJohannes Nape (CPA committee member, Acting Chairperson) 0829549153Bernice Ntobong (Member)Geoffrey Thekiso (Member)Molosi B. Thekiso (Member)Phomudzo Nethwadzi (Department of Minerals and Energy,Environmental officer, Klerksdorp office)Rudzani Mandiwana (Department of Minerals and Energy, AssistantDirector: Mineral Laws, Klerksdorp office)Resident on the farmResident on the farmResident on the farmMr Ofentse (Department of Health, North West province, Mmabatho) 0825994713Mr J. J. I. Swanepoel (Divisional Manager for Potchefstroom LocalDevelopment Centre, Department of Agriculture, North West province)Kevin McNeill (General Manager: Etruscan Resources IncorporationMining Company)0828724575018 29753300829080598Hennie Basson (Gothoma Diggings CC) 0829080598Rivonia Maboyi (Local Economic Development Manager, VentersdorpLocal Municipality)0825356065018 2644679Oupa Macana (Department of Housing, Mafikeng) 018 3876000Tebogo Petlane (ESKOM) 018 464666622

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claim8. AppendixBroad-based socio-economic empowerment charter for theSouth African mining industryVisionAll the actions and commitments set out below are in thepursuit of a shared vision of a globally competitive miningindustry that draws on the human and financial resourcesof all South Africa’s people and offers real benefits to allSouth Africans. The goal of the empowerment charter is tocreate an industry that will proudly reflect the promise of anon-racial South Africa.PreambleRecognising:• The history of South Africa, which resulted in blacks,mining communities and women largely beingexcluded from participating in the mainstream of theeconomy, and the formal mining industry’s statedintention to adopt a proactive strategy of change tofoster and encourage black economic empowerment(BEE) and transformation at the tiers of ownership,management, skills development, employment equity,procurement and rural development;• The imperative of redressing historical and socialinequalities as stated by the Constitution of theRepublic of South Africa, in inter alia section 9 onequality (and unfair discrimination) in the Bill ofRights;• The policy objective stated in the Mineral andPetroleum Resources Development Act to expandopportunities for historically disadvantaged persons toenter the mining and minerals industry or benefit fromthe exploitation of the nation’s mineral resources;• The scarcity of relevant skills has been identified asone of the barriers to entry into the mining sector byhistorically disadvantaged South Africans (HDSA’s);• The slow progress made with employment equity inthe mining industry compared to other industries.Noting that• It is government’s stated policy that whilst playing afacilitating role in the transformation of the ownershipprofile of the mining industry it will allow the marketto play a key role in achieving this end and it is notthe government’s intention to nationalise the miningindustry.• The key objectives of the Mineral and PetroleumResources Development Act and that of the Charterwill be realised only when South Africa’s miningindustry succeeds in the international market placewhere it must seek a large part of its investment andwhere it overwhelmingly sells its product and whenthe socio-economic challenges facing the industry areaddressed in a significant and meaningful way.• The transfer of ownership in the industry must takeplace in a transparent manner and for fair marketvalue.• That the following laws would also assist socioeconomicempowerment:• The Preferential Procurement Framework Act (No.5 of 2000);• The Employment Equity Act (No 55 of 1998);• The Competition Act (No. 89 of 1998) (Also ref. tothe Amendment Act No. 35 of 1999 and subsequentamendments);• The Skills Development Act (No. 97 of 1998).ThereforeThe signatories have developed this Charter to provide aframework for progressing the empowerment of historicallydisadvantaged South Africans in the Mining and MineralsIndustry. The signatories of this Charter acknowledge:Section 100 (2) (a) of the Mineral and Petroleum ResourcesDevelopment Act, which states that, to insure the attainmentof government’s objectives of redressing historical socialand economic inequalities as stated in the Constitution,the Minister of Minerals and Energy must within six monthsfrom the date on which this act takes effect develop a Broad-Based Socio-Economic Empowerment (BBSEE) Charter.1. Scope of applicationThis Charter applies to the South African mining industry.2. InterpretationFor the purposes of interpretation, the following termsapply:Broad-Based Socio-Economic Empowerment (BBSEE) refersto a social or economic strategy, plan, principle, approach oract, which is aimed at:• Redressing the results of past or present discriminationbased on race, gender or other disability of historicallydisadvantaged persons in the minerals and petroleumindustry, related industries and in the value chain ofsuch industries; and• Transforming such industries so as to assist in, provide23

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claimfor, initiate, facilitate or benefit from the:• Ownership participation in existing or futuremining, prospecting, exploration and beneficiationoperations;• Participation in or control of management of suchoperations;• Development of management, scientific, engineeringor other skills of HDSA’s;• Involvement of or participation in the procurementchains of operations;• Integrated socio-economic development for hostcommunities, major labour sending areas andareas that due to unintended consequences ofmining are becoming ghost towns by mobilisingall stakeholder resources.The term Historically Disadvantaged South Africans (HDSA)refers to any person, category of persons or community,disadvantaged by unfair discrimination before theConstitution of the Republic of South Africa, 1993 (Act No.200 of 1993) came into operation.HDSA Companies are those companies that are owned orcontrolled by historically disadvantaged South Africans.Major labour sending areas refer to areas from wherea significant number of mineworkers are or have beenrecruited.Ghost towns refer to areas whose economies weredependent on mining and therefore could not survivebeyond the closure or significant downsizing of miningactivities.Ownership of a business entity can be achieved in a numberof ways:• A majority shareholding position, i.e. 50% + 1 share;• Joint ventures or partnerships (25% equity plus oneshare);• Broad based ownership (such as HDSA dedicatedmining unit trusts, or employee share ownershipschemes).3. ObjectivesThe objectives of this charter are to:• Promote equitable access to the nation’s mineralresources to all the people of South Africa;• Substantially and meaningfully expand opportunitiesfor HDSA’s including women, to enter the mining andminerals industry and to benefit from the exploitationof the nation’s mineral resources;• Utilise the existing skills base for the empowerment ofHDSA’s;• Expand the skills base of HDSA’s in order to serve thecommunity;• Promote employment and advance the social andeconomic welfare of mining communities and themajor labour sending areas; and• Promote beneficiation of South Africa’s mineralcommodities.4. UndertakingsAll stakeholders undertake to create an enablingenvironment for the empowerment of HDSA’s by subscribingto the following:4.1 Human resource developmentThe South African labour market does not produce enoughof the skills required by the mining industry. Stakeholdersshall work together in addressing this skills gap in thefollowing manner:• Through the standing consultative arrangements theywill interface with statutory bodies such as the MinesQualifications Authority (MQA), in the formulation ofcomprehensive skills development strategies thatinclude a skills audit;• By interfacing with the education authorities andproviding scholarships to promote mining relatededucational advancement, especially in the fields ofmathematics and science at the school level;• By undertaking to ensure provision of scholarshipsand that the number of registered learnerships in themining industry will rise from the current level of some1200 learners to not less than 5000 learners by March2005; and• Through the MQA shall undertake to provideskills training opportunities to miners during theiremployment in order to improve their income earningcapacity after mine closure.Government undertakes that:• In its bi-lateral relations with relevant countries,undertakes to secure training opportunities for HDSAcompanies’ staff, as well as exchange opportunitieswith mining companies operating outside of SouthAfrica;• Through the MQA and in collaboration with academicinstitutions, DME associated institutions, NGO’s, andthe Gender Commission, shall provide training coursesin mining entrepreneur’s skills;Companies undertake:• To offer every employee the opportunity to becomefunctionally literate and numerate by the year 2005 inconsultation with labour;• To implement career paths to provide opportunitiesto their HDSA employees to progress in their chosencareers; and• To develop systems through which empowerment24

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claimgroups can be mentoredbuilding.as a means of capacity4.2 Employment equityCompanies shall publish their employment equity plansand achievements and subscribe to the following:• Establish targets for employment equity, particularlyin the junior and senior management categories.Companies agree to spell out their plans foremployment equity at the management level. Thestakeholders aspire to a baseline of 40 percent HDSAparticipation in management within 5 years;• South African subsidiaries of multinational companiesand South African companies, where possible, will focustheir overseas placement and/or training programmeson historically disadvantaged South Africans;• Identification of a talent pool and fast tracking it. Thisfast tracking should include high quality operationalexposure;• Ensuring higher levels of inclusiveness andadvancement of women. The stakeholders aspire to abaseline of 10 percent of women participation in themining industry within 5 years; and• Setting and publishing targets and achievements.4.3 Migrant LabourStakeholders undertake to:• Ensure non-discrimination against foreign migrantlabour.4.4 Mine Community and rural developmentStakeholders, in partnership with all spheres of government,undertake to:• Co-operate in the formulation of integrateddevelopment plans for communities where miningtakes place and for major labour-sending areas, withspecial emphasis on development of infrastructure.4.5 Housing and living conditionsStakeholders, in consultation with the Mine Health andSafety Council, the Department of Housing and organisedlabour, undertake to:• Establish measures for improving the standard ofhousing including the upgrading of hostels, conversionof hostels to family units and the promotion of homeownership options for mine employees; and• Establish measures for improving of nutrition of mineemployees.4.6 ProcurementProcurement can be broken down into three levels, namely:capital goods; services; and consumables.Stakeholders undertake to give HDSA’s a preferred supplierstatus, where possible, in all three levels of procurement. Tothis end stakeholders undertake to:• Identify current levels of procurement from HDSAcompanies;• Commit to a progression of procurement from HDSAcompanies over a 3 to 5-year time frame reflecting thegenuine value added by the HDSA provider;• Encourage existing suppliers to form partnerships withHDSA companies, where no HDSA company tenders tosupply goods or services; and• Stakeholders commit to help develop HDSA procurementcapacity and access Department of Trade andIndustry (DTI) assistance programmes to achieve this.• List of suppliers: It is envisaged that information on allHDSA companies wishing to participate in the industrywill be collected and published. All participants in theindustry will assist the DTI in compiling such a list thatwill inter alia be published by government on theInternet and updated regularly.4.7 Ownership and Joint VenturesGovernment and industry recognise that one of the meansof effecting the entry of HDSA’s into the mining industryand of allowing HDSA’s to benefit from the exploitation ofmining and mineral resources is by encouraging greaterownership of mining industry assets by HDSA’s. Ownershipand participation by HDSA’s can be divided into active orpassive involvement as follows:Active involvement:• HDSA controlled companies (50 per cent plus 1 vote),which includes management control.• Strategic joint ventures or partnerships (25 per centplus 1 vote). These would include a ManagementAgreement that provides for joint management andcontrol and which would also provide for disputeresolution.• Collective investment, through ESOPS and miningdedicated unit trusts. The majority ownership of thesewould need to be HDSA based. Such empowermentvehicles would allow the HDSA participants to votecollectively.Passive involvement:• Greater than 0 percent and up to 100 percentownership with no involvement in management,particularly broad based ownership like ESOPs.In order to measure progress on the broad transformationfront the following indicators are important:• The currency of measure of transformation andownership could, inter alia, be market share asmeasured by attributable units of South Africanproduction controlled by HDSA’s.• That there would be capacity for offsets which wouldentail credits/offsets to allow for flexibility.• The continuing consequences of all previous dealswould be included in calculating such credits/offsets25

Bakwena ba Mare a Phogole (Klipgat) Community Restitution Claimin terms of market share as measured by attributableunits of production.• Government will consider special incentives toencourage HDSA companies to hold on to newlyacquired equity for a reasonable period.In order to increase participation and ownership by HDSA’sin the mining industry, mining companies agree:• To achieve 26% HDSA ownership of the miningindustry assets in 10 years by each mining company;and• That where a company has achieved HDSA participationin excess of any set target in a particular operationthen such excess maybe utilised to offset any shortfallin its other operations. All stakeholders accept thattransactions will take place in a transparent mannerand for fair market value. Stakeholders agree to meetafter 5-years to review the progress and to determinewhat further steps, if any, need to be made to achievethe 26% target.4.8 BeneficiationThis Charter will apply to mining companies in respect oftheir involvement in beneficiation activities, specificallyactivities beyond mining and processing. These includeproduction of final consumer products.Mining companies will be able to offset the value of thelevel of beneficiation achieved by the company against itsHDSA ownership commitments.Mining companies agree to:• Identify their current levels of beneficiation.• Indicate to what extent they can grow the baselinelevel of beneficiation.4.9 Exploration and prospectingGovernment will support HDSA companies in explorationand prospecting endeavours by, inter alia, providinginstitutional support.4.10 State assetsGovernment will ensure compliance with the provisions ofthis Charter and be exemplary in the way in which it dealswith state assets.4.11 LicensingTo facilitate the processing of licence conversions therewill be a scorecard approach to the different facets ofpromoting broad-based socio-economic empowermentin the mining industry. This scorecard approach wouldrecognise commitments of the stakeholders at the levelsof ownership, management, employment equity, humanresource development, procurement and beneficiation.These commitments have been spelt out in sections 4.1 to4.9 above.The HDSA participation required to achieve conversionwithin the five-year period on a company specific basiswill be specified in the score-card, hereto attached asAnnexure A.4.12 Financing MechanismThe industry agrees to assist HDSA companies in securingfinance to fund participation in an amount of R100 billionwithin the first 5 years. Participants agree that beyond theR100 billion-industry commitment and in pursuance of the26 per cent target, on a willing seller – willing buyer basis, atfair market value, where the mining companies are not atrisk, HDSA participation will be increased.4.13 Regulatory framework and industryagreementGovernment’s regulatory framework and industryagreements shall strive to facilitate the objectives of thisCharter.4.14 Consultation, monitoring, evaluationand reportingIt is recognised that the achievement of the objectives setout herein entails an ongoing process.Companies undertake to report on an annual basis theirprogress towards achieving their commitments, with theseannual reports verified by their external auditors. A reviewmechanism will be established which again providesflexibility to the company commitments.Parties hereto agree to participate in annual forums for thefollowing purposes:• Monitoring progress in the implementation of plans;• Developing new strategies as needs are identified;• Ongoing government/industry interaction in respectof these objectives;• Developing strategies for intervention where hurdlesare encountered;• Exchanging experiences, problems and creativesolutions;• Arriving at joint decisions;• Reviewing this Charter if required.26