South Africa | Distributions to Ingonyama Trust beneficiaries 'vaguely reported' in financial reports - experts

The Ingonyama Trust does not appear to keep its beneficiaries informed of developments and operations of the land, and it has been more absent in the communities it is supposed to benefit during Covid-19.

This is according to Zenande Booi, who was a panellist at a virtual discussion hosted by the Nelson Mandela Foundation, in collaboration with the Land and Accountability Research Centre (LARC) at the University of Cape Town and the Public Affairs Research Institute with the support of the Hanns Seidel Foundation.

The topic of Wednesday's discussion was "The Future of the Ingonyama Trust: Substantive Accountability in a post-Covid Era".

Booi heads activities within the LARC's land stream. She said while residential and commercial leases were significant sources of income for the trust, its reports to Parliament have been unable to show how the money it made benefitted the people who hold leases with it and paid rent. 

"There is little indication that these commercial leases are concluded in accordance with the provisions of the trust act, Zulu customary law...

"Community partners that we worked with report not being informed of developments and not knowing the terms of the lessor, the impact the development will have on their land rights and their ability to access the national resources on this land," Booi said.

The trust is the biggest landowner in KwaZulu-Natal and King Goodwill Zwelithini is its only trustee.

After the trust could not account for the R22 million allocated to it by the Department of Agriculture, Land Reform and Rural Development, the relevant portfolio committee recommended in May that the department suspend payment to the trust.

It pointed out that there were no clear programmes to deal with the empowerment of youth, women and people with disabilities in rural communities, in line with the purpose of the board, which was the management of the trust for the material well-being of traditional communities, News24 reported.

In June, portfolio committee chair Zwelivelile Mandela said if it was found that the trust was a failure, it should be scrapped.

This was after the trust's board admitted there was "constant, perennial irregular expenditure".

Booi added that the trust's absence in keeping its beneficiaries abreast was even more felt by communities who bore the brunt of the impact of Covid-19.

She said there had been no indication that the trust was seen in communities during the crisis. 

"Community members gave accounts of not being able to access food parcels, services like water and sanitation and other relief efforts in response to Covid-19."

Another panellist, property lawyer and senior research associate at the LARC, Janet Bellamy, said the annual financial statements of the trust have over the years vaguely reported on the distributions to its beneficiaries.

She said it was important to view the question of accountability in the context of the beneficiaries of the Ingonyama Trust, saying they were the members and residents listed in the act.

Bellamy said the beneficiaries were the primary stakeholders of the trust and that in terms of the act, the trust must be administered for their benefit, material welfare and social well-being.

She said: 

Leasing practices of trust land indicates that the trust, under the leasing approach, has accumulated significant reserves, yet with what seem to be a significantly low ratio of distribution of these reserves to beneficiaries.

"In conclusion and in short, what we have found in reading the annual financial statements, is that distributions to beneficiaries are vaguely reported. They are given very little relevance, with little or no mention of how distributions are put to use."

Last month, the Mail & Guardian reported that an audit into the finances of the Ingonyama Trust Board (ITB) was under way.

The board's chairperson, Jerome Ngwenya, reportedly wrote to Land Reform Minister Thoko Didiza, threatening her with legal action should the audit go ahead.

He argued that he was accountable to the monarch and that the Public Finance Management Act did not apply to the revenue raised by the ITB.

Bellamy said: "Arguing that the trust is not accountable under the Public Finance Management Act (PFMA) is concerning and it's a red flag."

She said this argument permitted a lack of oversite and transparency over the nature of trust funds and the allocation to projects that would benefit principal stakeholders, being the beneficiaries of the trust.

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