From Certificate of Rights to Long-Term Leaseholds in Botswana

Boipuso Nkwae1 and Dixon Dumba2

1Department of Civil Engineering-Geomatics Section, 2Department of Home Economics

University of Botswana, Gaborone, Botswana

and

Abstract

The Certificate of Rights is one of the most innovative, simple and workable tenure option introduced by the Government of Botswana to provide security of tenure to low income groups. The tenure was introduced in the early 1970s as part of strategies to deal with problems of informal (squatter) settlements that mushroomed as a result of rapid urbanization in the post independence period as well as provision of secure tenure to site and service schemes for the urban poor. The tenure provides a ‘stop gap’ land tenure option for the developing world in the sense that for countries with limited resources, it can be introduced while ‘avoiding involvement in the complexities and costs of title registration’ (Dickson 1990: 26-30). In addition it can be upgraded over time to full title, a process which is in keeping with the incremental approach in self-help housing. Its introduction has notbeen without problems.The land administration capabilities in the various sectors were stretched to the limit. For instance, the municipal authorities responsible for administering the Certificate of Rights were faced with severe capacity constraints.The COR grants also faced the problem of “fronting”and non-payment of service levy as the urban poor transfer their COR plots to rich speculators and developers. Land Boards, especially in peri-urban settlements which administer tenure akin to the Certificate of Rights face an even tougher battle of combating lawlessness as they lack both the technical and administrative capacity to address the peri-urban land problems. Therefore, in considering Botswana’s land tenure and land administrative innovations, these weaknesses would need to be evaluated given the resource implications required when introducing new land tenure regimes and new land administration systems.

1. Introduction

Land tenure security is central to housing development. Laquian (IDRC doc undated) noted that if people were assured security of tenure, they would voluntarily improve their dwellings to the fullest extent that they were capable of. However, if people felt insecure, they would refrain from making home improvements even if they had the means to do so. Investing in a dwelling when it could be demolished at any time would not make economic sense. Observers of the urban scene have stressed the crucial importance of tenure issues in the analysis of urban poverty, underlining the strong correlation between housing conditions, access to services, environmental and health problems, and tenure status (Durand-Lasserve, 2006). Tenure security is crucial in investment decisions be they by low income or high income groups. Other authors ‘point at a worsening access to shelter and security of tenure’ (Lopez Moreno, 2003), sometimes incriminating a context of accelerated globalization combining deregulation measures and state disengagement from the urban and housing sector (United Nations–Habitat, 2003a, Millennium Project -Task Force 8, 2003 and 2005).Addressing tenure informality is thus a major challenge for governments (Durand-Lasserve, 2006), in particular, ‘ensuring the security of land tenure through de facto protection against evictions or de jure formalization of land tenure can have obvious benefits in terms of enhanced investment incentives, improvements in equity, and reduction of the potential for conflicts’. This is clearly emphasized in the Habitat Agenda which states that “access to land and security of tenure are strategic prerequisites for the provision of adequate shelter for all and the development of sustainable human settlements”(UNCHS, 1996 and 1999).

To developing countries whose tenure arrangements are undeveloped or at infancy, a leaf can be taken out of Botswana’s book as it introduced basic tenure for the low income groups which took into consideration peoples’ ability to develop gradually on an incremental basis. UNCHS (2003) has noted that member states of the United Nations in Africa “have realized that land titling is not a panacea for all tenure security ills”. Consequently over the last decade a number of countries such as Namibia, Mozambique, Uganda, Tanzania have been re-thinking their approaches to land, and Africa is now at the forefront of new approaches to land administration” (UN-HABITAT, 2004). Land tenure innovations include the introduction of a range of tenure options such as temporary occupation permits or occupancy rights, anti-eviction rights and adverse possession. UNCHS (2005) emphasizes that “security of tenure should be understood as a continuum with titling at one end, and that there are a range of tenures that can supply tenure security to the urban poor and which can be improved over time”. The Certificate of Rights option in Botswana provides a free tenure for the urban poor which is upgradeable over time and is adaptable to conventional land registration system to accommodate the needs of the urban poor.

2. Brief Background on Botswana

Botswana is a semi-arid, land-locked country in Southern Africa with Zambia to the north, Zimbabwe to the east, Namibia to the west and north, and South Africa to the east and south. It is a relatively flat country with a land area of 585 370 square kilometers, making it larger than France and slightly smaller than the State of Texas in the United States. Though it is a large country, it has a small population. Botswana’s population is estimated at about 1.7 million. According to the 2000 United Nations Development Programme Report, which predicts an average population growth rate of 1.3 percent between 1998 and 2015, the population is expected to reach the 2 million mark by 2015. The population growth rate between 1991 and 2001 was 2.38% compared with 3.50% between 1981 and 1991 (CSO, 2001). The country has one of the world’s lowest average population densities, which is estimated at a little over three people per square kilometer (CSO 2001), with 80% of Batswana (people of Botswana) concentrated in the more fertile eastern regions where land and water resources are more favorable. Traditionally a pastoral society, with a predominantly rural population, an ever-increasing numbers of Batswana have been moving to urban areas and large villages in the last three decades. Urban growth rates have been estimated at about 7% per annum compared to the average national growth rate of 3.4% (Ministry of Local Government, Lands and Housing, 1996). Nearly half of the country’s population now lives in urban areas. Until recently, official housing policies have focused on urban areas because these are areas of highest population concentration.

Despite this high rate of urbanization, Botswana did not institute a national urban development strategy up until 1978 and no national housing policy until 1982. The government only provided housing to its employees. The urban poor and the new migrants from the rural areas were left to fend for themselves. The provision of shelter was not considered a top priority by the government then. To make matters worse, there was no attempt before independence in 1966 to prepare either a national, regional or local physical plans; those that existed were usually where the white European settlers lived. Fifteen years later, there was realization that the problem of squatter settlements that were mushrooming in almost all Botswana’s urban centers would require urgent attention. The needs of a rapidly urbanizing economy led government to introduce innovative tenure regimes such as the Certificate of Rights to curb squatter problems and the Fixed Period State Grant for the middle and high income groups.

Botswana was one of the world’s poorest countries when it achieved independence from Britain in 1966. Fortuitously, the nation discovered large diamond reserves shortly after independence that have driven its economy ever since. The country has witnessed one of the highest growth rates in the developing countries with a GDP growth rate of 4.7% in year 2007 estimates (CIA-The World FactBook-Botswana, 2008). Buoyant revenues mainly from diamonds have lifted Botswana from being a major recipient of international aid loans and grants. This, as will be shown later, has implications as to how the country’s resources are utilized to fund development programs. The Government of Botswana has channeled resources into development, including improving the nation’s road network, schools, health centers and infrastructure development. While much work remains to be done, Botswana continues to devote its resources to development projects including housing.

3. Botswana’s Land Tenure Systems

It is important to provide a background of the land tenure systems in Botswana prior to focusing on the Certificate of Rights. There are three basic land tenure categories in Botswana: the Customary (Tribal or Communal) which comprises about 71%; StateLand (23%) and FreeholdLand which consist of about 6% (Mathuba, 1993). These types were in existence before independence in 1966 and since then government has introduced land reforms to cater for the needs of a growing and economically active society.

3.1 Customary Land

The tenure is secure, land rights are perpetual and inheritable and the land is allocated free of charge and hence the land is not treated as a commodity. This is however changing as land close to urban areas is gradually being sold on the open market. Chiefs used to oversee administration of land before Land Boards were established. (Land Boards are modern day institutions that administer tribal land). The chief administered land allocation through his representatives known as ward heads. The land was allocated according to zones for three main uses i.e. residential, ploughing and grazing.

The characteristics of the customary tenure can be summarised as:

•Generally not coded, largely unwritten

•Based on tradition and custom

•Easily accessible by group members

•Very secure and inheritable

•Inalienable rights by individual members of the group i.e. land is not a commodity

•Cannot be mortgaged

•Cannot be transferred to non-citizens

•Flexible and dynamic, not static

3.2 State Land

As the term denotes, State land is owned by government and is found in rural and urban areas. In urban areas, the land is allocated to individuals and organizations for residential, industrial and commercial purposes. StateLand in rural areas is used as game reserves and national parks and some is leased to farmers for grazing purposes.In the urban areas, the land ownership patterns are influenced by the statutory land tenure system with approximately 95% of the land being State land. Stateland is administered under the State Land Act (Cap 32:01). The land allocation is done by the Attorney General with assistance from the Department of Lands. Land in urban areas as opposed to rural areas is serviced. The government policy is to allocate land on the basis of full cost recovery in case of a first time buyer, if not one pays full market price. Allocations can be in the form of either Fixed Period State Grant (FPSG) or a Certificate of Rights (COR). COR is administered by the Self-Help Housing Agency (SHHA) under each town or city council and a low interest building materials loan or SHHA loan is provided.

3.3 Freehold land

Freehold land was created during the colonial era by the state permanently alienating its title to individuals and organizations. Freehold land is found in some of Botswana’s prime agricultural belts such as the eastern Tuli Block of the country as well as some designated blocks in the Ghanzi District. Freehold was also created after independence in towns such as Gaborone as an incentive for individuals to participate in the economic development of the country (Mathuba, 1992),as a kind of an empowerment approach. Private developers have also purchased farms at the urban periphery and subdivided the land and sold it on a freehold basis. Phakalane Estates in Gaborone is a case in point. The freehold title is inheritable, freely transferable, and registrable and does not lapse with time.

4. The Origin of Certificate of rights

As indicated in earlier sections, before the colonial era, land was held in accordance with customary land tenure systems. Tribal chiefs were the guardians who allocated land for residential, grazing and ploughing purposes. A villager secured a residential plot in the village, arable land for ploughing in ‘lands’ areas where ploughing is done and a cattle post in areas set aside for livestock grazing. An individual allocated land had lifetime security over it and upon death the land could be passed to heirs by inheritance. Modern day tenure systems have their basis in the statutory land tenure systems introduced during British colonial rule. Land was allocated as freehold to the settler community and the rest was retained as crown land. Following independence Crown land was renamedState land and new land rights were introduced which included amongst others the Fixed Period State Grant (99-year leasehold) and the Certificate of Rights in urban areas.

The Certificate of Rights as an urban land tenure innovation was developed in the early 1970s to cater for the urban poor as a land tenure alternative to curb squatting in Botswana’s urban centres. Its other objective was to provide a secure and inexpensive form of tenure to support the site and service schemes for the urban poor. To reduce costs the demarcation of boundaries for COR plots was done on the basis of general plans or block diagrams (See Figure 1). Minimum services were provided including earth roads, communal water stand pipes and pit latrines. Neither electricity nor street lighting was provided until 1992 when the new Urban Development Standards were introduced.

Fig. 1 (a) Gazettement of a Rectified Orthophoto, Old Naledi, January 1977

Fig.1(b) Overlay Showing Final Lot Boundaries

Fig. 1(c) Approved Survey of Part of Old Naledi, 1992

(Courtesy of the Department of Surveys & Mapping)

The plot holder maintains the usufruct of the plot and the State maintains ownership. The tenure is secure, perpetual, inheritable and can be assigned, pledged and be ceded with the consent of the Council. It is also convertible to a 99 year lease, i.e. the Fixed Period State Grant after carrying out a cadastral survey and a title registration. Technically speaking,COR can be mortgaged, pledged and hypothecated (Kalabamu and Morolong, 2004). Financial institutions are however wary about accepting COR title as collateral since,

  • The land belongs to the State and plot holders are prohibited from transferring or ceding the property without prior written consent of town/city council. A major concern is the involvement of a third party, the Town Council whose consent is required for sale in execution of the COR. If property is to be good security for loans, the lender must be able to sell to recover loans in case of default.
  • Land is not surveyed to cadastral standard and titles are not legally registered.
  • Costs to convert COR titles to FPSG are prohibitive (e.g. Maendeleo, 1992; GeoSolutions, 2007).

In the original proposals for the issuing of COR, three categories of applicants were contemplated:

  • Type I COR. This was mainly designed to curtail the mushrooming of squatter settlements in the urban centres. It was supposed to be an annual tenancy for basic housing structures of non-payment nature.
  • Type II COR. This was to be granted to the lower income groups whose income did not exceed P1, 500. The group was expected to meet the minimum development standards and also qualify for a subsidized monthly service charge from the municipal authority. Technical assistance from the SHHA program and a building materials loan accompanied this land development initiative.
  • Type III COR. This proposal aimed at the middle-income group, who could afford the high land servicing standards closer to the high-income neighbourhoods.

With this approach, it was envisaged would lead to innovative investment in housing and other commercial activities with FPSG reserved for the high income group. However, during its implementation, only type II COR was issued as it found to be more appropriate for the low and middle income. However, this approach excludes those urban poor without any source of income.

The strength of this tenure option lies in having averted the squatter problem in Botswana’s urban centres of Selibe-Phikwe and Gaborone. Due to its success, the COR was extended to other towns like Francistown, Jwaneng, Kasane and Ghanzi. The same concept has now been extended into the rural and peri-urban areas to improve the housing conditions. In theory, the COR can be hypothecated if registered at the Deeds Registry Office.

4.1 How the Certificate of Rights Works?

Despite measures to phase out the allocation of Certificate of Rights, this tenure regime will remain a permanent feature of Botswana’s land tenure system for the foreseeable future. It constitutes over 50% of all the housing stock in Gaborone. The following sections examine how the Certificate of Rights worked in practice. The tenure was the major instrument for the allocation and management of the aided self-help housing programme called SHHA. The Self-Help Housing Agency (SHHA) programme has operated in the urban centres and some urban villages since the early 1970’s. Initial funding was from foreign donors (particularly USAID) until responsibility for SHHA was given to the Housing Departments of the various Town Councils in 1978 from which date government has funded the scheme.

The SHHA programme provides land and housing finance to low-income urban dwellers. The SHHA land allocation procedure approximates the tribal land allocation process for tribes-people in the tribal/customary land areas, formerly executed by the chief or headman and latterly by the Land Boards. SHHA applicants, who must be citizens, and be formally employed or legitimately self-employed in the town or city where the application is lodged, must earn between P4 400 – P24 300 ($715 - $3 950) to qualify for low-income plots, and between P 24 301 – P36 400 ($3 951 - $5 200) for middle lower income plots. Currently, the maximum SHHA loan is P20 000 ($3 250) at an interest rate of 10% (well below prime) repayable over 15 years. If the applicants qualify for a plot, they automatically qualify for a building loan.