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payable to the government would be due. Some concern has been expressed about the wisdom of
allowing scattered conversion of landholdings in customary areas. A significant increase in annual
ground rents would give holders a reason to hesitate before applying for conversion.
The Land Titles Act reform draft also repeals and replaces SeCtiOnS 10 and 12, dropping
assertions that bare land has no economic value. It further provides that the president, when granting
land, "may fix consideration and ground rent which may be reasonable depending on the location and
the size of the land." This appears to be a prudent provision, that should provide ample authority for
needed administrative reforms in valuation and in the setting of initial fees and recurring or annual
ground rents.
The draft adds a provision that on expiry of a lease, if all the conditions and covenants in it
have been complied with, "the lease shall be deemed to have been extended for a like term. The
registrar, on production of a certificate of such compliance from the President, shall issue a Certificate
of Title to that effect." To further reassure leaseholders who hesitate to invest as expiration
approaches, the law should also allow holders to obtain a compliance certificate and request a 99-year
renewal at any time, even if the current lease has not expired.
The draft reform provides that failure to pay ground rent on due dates will triple the amount
due, and failure to pay that amount upon demand will entitle the president to enter a certificate of
reentry in the register, without notice, in effect canceling the leasehold. This should increase
collections, provided the regular ground rent is itself appropriately determined, and that the
government acts in a responsible manner. The penalty of lease cancellation, if effectively enforced,
should cause mortgage lenders to see that their debtors pay ground rents, and on time, so as not to
impair the collateral on their loans.
VII. Land development fund
A. Proposals and assessment
The land conference of July 1993 (see chapter 1) strongly recommended the creation of a land
development fund (LDF). There was considerable agreement that it would have as its resources ground
rents paid by leaseholders, consent fees charged to the assignees of newly distributed lands, and other
receipts from government or private land transactions. An MOL official memorandum suggests that
the fund be used for "plot demarcations, roads and bridges construction, provision of water supplies
(dams, wells, and boreholes), dip tank construction, conservation works, and fencing. Beneficiaries
would repay the investment in annual installments over ten years, with interest. Payments would go
back into the fund, which would operate as a revolving fund. n 14 It suggests that the fund begin by
making such investments in the vast undeveloped areas (former Reserve and Trust Lands), and later
include individual emergent farmers who are not in the farming blocks nor in the settlement schemes.
Once the fund is serving these first two phases well, it suggests converting it into an autonomous fund
that serves commercial farmers in addition to the schemes and emergent farmers. However, the
participants did not reach consensus about the fund's objectives and priorities. Various possibilities
14
D. Siansumo1. , Principal Lands Officer, "Development Fund" memorandum, 20 October 1993.