LexisNexis

Guidance on the resettlement of mine communities in South Africa

Thursday 29 September 2022

Mmaphuti Morolong-Nyezi

Fasken, Johannesburg

mmorolong@fasken.com

Asithandile Liwela

Fasken, Johannesburg

aliwela@fasken.com

Background

Mining is a significant contributor to the South African economy. It not only creates job opportunities, but also creates opportunities for the development of small and medium enterprises through the award of procurement opportunities, enables the empowerment of historically disadvantaged individuals and also enables the development of communities affected by the mining activities.

It is important that the focus on the prospects of mining does not lead to the marginalisation of the people who are generally most affected by mining. It is for this reason that the Mineral and Petroleum Resources Development Act No 28 of 2002 (MPRDA) provides for interested and affected persons in respect of a mining operation to: (1) be invited to comment on an application for a prospecting right, mining right or mining permit (mining right); and (2) be consulted on the environmental impacts of the mining operations before the approval of a mining right application. The MPRDA and related regulations (the Regulations) also provide for the development and implementation of a Social and Labour Plan, which sets out the human resource development, local community development and small and medium enterprise development commitments made by the mining right holder to the affected community and the Department of Mineral Resources and Energy (DMRE), and which commitments must be implemented and reported on by the mining right holder.

Beyond the reference to consultation in the relevant sections of the MPRDA, which deal with applications for mining rights, it does not provide guidelines for how landowners or lawful occupiers who will be displaced to enable mining to take place should be treated or accommodated. The guidelines developed by the DMRE, in terms of sections 10(1)(b), 16(4)(b), 22(4)(b),27(5)(b) of the MPRDA, on consultation with interested and affected parties also do not provide for this. Section 54 of the MPRDA provides for circumstances in which the lawful occupiers or landowners prevent a mining right holder from commencing or conducting mining operations and provides for the regional manager of the DMRE in such circumstances to be notified and to call for the parties to reach agreement on the compensation payable to the lawful occupiers or landowners for loss of use of the mining area; but it too does not provide guidelines for how the compensation should be determined.

The legislation left it up to the mining right holders and landowners and lawful occupiers to negotiate the terms on which the landowners and lawful occupiers would be willing to grant the mining right holder access to the mining area. This position has now been changed by the promulgation of the Mine Community Resettlement Guidelines (the Resettlement Guidelines) by the minister of mineral resources and energy in March 2022. These guidelines must be considered and implemented where mining activities will have the effect of displacement of or resettlement of landowners, lawful occupiers, holders of informal and communal land rights, mine communities and host communities (Affected Parties). The salient features of the Resettlement Guidelines are set out below.

Resettlement principles

The Resettlement Guidelines are premised on the following principles for resettlement:

  • meaningful consultation by the mining right applicant or holder with Affected Parties regarding the resettlement;
  • equality of the people affected by the resettlement in that the proposed resettlement must not violate the rights of vulnerable members of communities, including women, children and people living with disabilities;
  • protection of existing rights of Affected Parties to not be deprived of the rights to land without the provision of appropriate compensation;
  • conditions relating to meetings, in that all stakeholders must be given sufficient notice of meetings and reasonable opportunity to participate in resettlement consultation meetings;
  • avoid and minimise, in that wherever feasible, resettlement must be avoided or minimised, and where it is unavoidable, it must be ensured that it leaves the affected individuals as well off as they would have been in the absence of mining; and
  • professional services, in that the mining right holder or applicant should endeavour to use the services of historically disadvantaged South Africans in the implementation of the resettlement process.

Requirements for mining right holders or applicants

The Resettlement Guidelines provide that a mining right holder or applicant is responsible for the costs associated with the resettlement of the relevant affected parties. To facilitate the process for reaching a resettlement agreement,[1] mining right applicants and mining right holders are required to, among others:

  • develop and meaningfully engage with the Affected Parties about a resettlement plan[2] and a resettlement action plan;[3]
  • provide Affected Parties the opportunity to comment, and obtain clear, accurate and understandable information about the impact of the proposed mining activity or implications of a decision on resettlement;
  • offer Affected Parties choices and options that are practical and economically suitable in respect of resettlement;
  • provide Affected Parties with compensation for losses to their property and livelihoods;
  • assist with the resettlement by providing financial and related support to Affected Parties;
  • provide Affected Parties with residential housing, housing sites or agricultural land;
  • offer support after resettlement to ensure livelihoods and standards of living are restored;
  • assist with sustained development within the resettled mine community or host community after resettlement;
  • consider amongst others, enabling resettled people to appropriately share in the benefits such as project related employment; and
  • establish a resettlement monitoring and evaluation committee, which shall comprise representation from stakeholders, which include mine communities, landowners, lawful occupiers and the local traditional authority; and which shall be responsible for monitoring the implementation of the resettlement plan, resettlement action plan and resettlement agreement.

Types of resettlement packages

The Resettlement Guidelines provide that the types of resettlement packages for Affected Parties may include: (1) cash compensation for assets, including crops and structures; (2) provision of resettlement housing; (3) provision of a resettlement site; (4) allowances to facilitate the moving process; and (5) livelihood restoration programmes.

Conclusion

Although the Resettlement Guidelines are not law, they are a good guidance tool for mining communities to use when negotiating with a mining right holder or applicant in relation to their resettlement and are equally a good guiding tool for providing a mining right holder and applicant with some certainty regarding financial provision for the resettlement of mine communities or affected people.

It will be interesting to see how these guidelines are implemented by both communities and mining right holders and applicants.


[1] This document serves to record in full all the commitments made by a mining right holder in the resettlement plan and the resettlement action plan.

[2] This broad consultative document is concerned with (resettlement) project description, impact analyses, costs and budgetary considerations and consultation mechanisms.

[3] This document lists the steps to be taken to achieve the goals set out in the resettlement plan.

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