Continued from March 24
State land under major irrigated settlement scheme had been allocated to the initial settlers under various extents from time to time with restriction, preventing sale and sub division into parcels less than 1.5 acres in case of lowlands and 0.5 acre for highland as stated in the Land Development Ordinance of 1935 and its subsequent amendments. However, with the development of settlement schemes and population growth, original allotments have been informally subdivided among the descendants according to customary practices disregarding the legal restrictions. The findings of the research reveal that there is a growing pressure from beneficiaries to amend the existing statute to legalize further fragmentation.
An analysis of the findings on the subject of informal land fragmentation in settlement schemes in Sri Lanka reveals that about 57% and 30% of the existing lowland and highland plots respectively in the major irrigated settlement schemes are informally fragmented. About 28% of the lowland plots have been fragmented into less than 1.5 acres in extent, being the official minimum limit permitted under the LDO as amended. Primary reason for land fragmentation is to provide the settlement land for their children, which is considered by the farmers as their social obligation to treat all the children equally. Therefore most of the farmers are willing to divide the land parcels equally among all their children disregarding the minimum size specified above under the Land Development Ordinance as amended.
Over 35% of the population in the country is directly or indirectly dependent on land. Therefore, land fragmentation as found in the research studies causes many issues related to social, economic, political, cultural and environmental problems. Some of the direct effects of land fragmentation are reduced land productivity, intensive cultivation, cultivation of reservation lands and disputes among community members harming social integration. Formal sub-division land into small parcels is expected to create problems in water management and irrigation system operation and maintenance (O&M) because of higher resource requirement (physical and human) for the O&M. Increased number of small legal land holdings and higher irrigation water requirements can also cause more drainage from each land block. The study indicated that the legal transfer of small pieces of land would pave the way for farmers to sell their allotments outside their family which could create complaints on managing water between small plots breaking current harmony that prevail within family members. Since pressure on land in the settlement schemes gives rise to fragmentation of allotments, means must be devised to ease pressure on State land.
Encroachment on State land
The research conducted on encroachment on State land reveals that it is not a recent phenomenon and has occurred earlier in the major settlement schemes. For example, the survey of encroachments on State land undertaken by the Ministry of Land and Land Development in 1979 reveals that by that time 6% of State land were under encroachment of various forms. The studies conducted later for example in 1990 revealed that encroachment ranged in size from amount 0.1 ha or more with an average size of 0.6 ha (1.6 acres). As far as the Dry Zone is concerned, encroachment in this zone are of two basic types: (a) those associated with State sponsored settlements and (b) those associated with traditional villages.
The settlement projects, particularly those provided with irrigation facilities attract encroachments. At least two parallel processes are at work in creating settlement based encroachments. One process results from the attraction of settlement projects for non- settlers as places of concentration of economic opportunities in and otherwise scarcely populated and economically lagging region. For them, encroachment spells a high risk of complaints and eviction by regular settlers and officials alike. The other process results from the desire of settlers to ensure satisfaction of future land, food, income security and living level maintenance needs of their families. In this sense, encroachment is also a future risk aversion strategy. The maximum encroachment upon reservation land within the settlement schemes occurs in the very early stages of settlement. This probably reflects a move by new settlers anticipating future scarcities to ensure a means of existence to their succeeding generations.
The evaluation of research findings indicate that the expansion of cultivable acreage of settlement property through encroachment is largely a product of subsistence pressures. It is also a reflection of prevailing poverty conditions and lack of opportunities beyond those associated with land and agriculture. Thus, the pre-occupation with land that is reflected in the incidence of the encroachment is a symptom of a more deep- seated failure of the settlement encompassing region economy to generate adequate employment and income opportunities at a pace above the rates of growth of the population.
The regularlisation of encroachment, although politically attractive and administratively convenient is incompatible firstly with the policy of mapping- out of State land so fervently advocated by the first Land Commission of 1927 and secondly with the land use planning. This has further complicated the problem of water management too.
Section 20 of the original LDO provides for selection of people for alienation of State land through the Land Kachcheri. However, section 20 as amended by Land Development (Amendment) Act of 1969 changed this procedure and permitted under section 20A allowing selection of people outside the Land Kachcheri also. As a remedy to the encroachment problem, the government has as stated above amended the LDO whereby selection to State land allotments has been relaxed to accommodate encroachments. The regularization of encroachment is effected through this section 20A. Due to possibility of irregularities and corruptions that may occur in utilizing this amended section. Circular has been issued. The Circular in this regard is Circular No.2005/2/ and dated 2005.01.25 issued by the Land Commissioner General to Provincial Land Commissioners, Deputy Land Commissioners and Assistant Land Commissioners on the subject of Forwarding Reports under section 20A of the Land Development Ordinance for Approval.
This Circular noted that doubts have arisen with regard to choice of a person on transparency. Therefore after the date of the Circular in furnishing reports for approval under section 20A of the LDO for regularization of encroachments, the Land Commissioner General instructs the Provincial Land Commissioners, Deputy Land Commissioners and Assistant Land Commissioners to advise all Divisional Secretaries to follow the procedure embodied in the Circular. The procedure includes (a) public inspection of persons by Divisional Secretaries, (b) calling objections after publication of the list of persons selected, (c) after reviewing the objections the report by the Divisional Secretary to the Land Commissioner General or Provincial Land Commissioner on the selection of persons. It is hereby recommended to strictly enforce this Circular.
It is our view that some encroachments, specially environmentally sensitive reservations cannot be regularized. Therefore it is essential where such reservations have been encroached, action should be taken against such encroachers. It is preferable to prevent encroachments to State land rather than taking action after encroachments by the proper exercise of powers by the officials authorized to do so: e.g. Divisional Secretaries in their areas of authority with the blessings of central authority.
Informal land transactions
According to the analysis of the findings, informal operation of lowland is prominent in settlement schemes. The most popular informal transaction methods are leasing on fixed produce (vee badu), leasing on cash and mortgaging. The other methods are purchasing without legal documents, fragmenting, jointly managing and encroaching on government and private lands. The common reasons for informal land transactions are the shortage of family labour for cultivating the land and difficulty of cultivating because legally entrusted parties living far away from the land.
One major reason for labour problem in settler families was the dislike of second and third generation members of settlers families to engage in agriculture as income from agriculture was unattractive. One important reason for leasing out is the need of money for emergency requirements. The informal tenure – transactions methods are diverse depending on land rent, cultivation rights and terms and conditions on managing the land.
Findings of the research on cultivation of allotments under informal land transactions revealed both benefits and disadvantages to the settlers and allotments. As regards benefits, even with less security of tenure, the informal operators have resorted to cash as well as non cash investments towards obtaining maximum returns in the same manner as owner cultivators. With regard to the application of inputs and technological use, informal operators are in a better position. With regard to yield obtained too, informal operators appear to have higher level yield than owner operators. On the average the returns from paddy under different tenure conditions were higher than under owner operator systems.
However, under leasing on cash systems, the land owner lost the cultivation rights of land for about 4 and 5 years and in many cases land owner has become a labourer by hiring his labour on his own land. Under mortgage system, land owner loses cultivation rights until the loan is paid. The most severe damage to the holding due to informal land transaction is the fragmentation of the holding resulting in the emergence of uneconomic holdings on the one hand and consolidation of land by rich people on the other hand. As revealed in the study, informal operators do not conform to common production plan and common decision of farmers which is a severe burden for the implementation of a common production plan. Moreover, where the land is given on informal land transactions, legal owner do not invest for improving the long term productivity of the land as preparation of ridges and maintenance of canals etc.
As the findings of research study indicate, subdividing and transferring of small parcels or distributing the ownership of land among a number of children equally is a major requirement for many of the legal owner operators in the settlement schemes. Granting of freehold titles will allow them to effect such transfers legally. But there is a possibility of fragmentation of land into uneconomic smaller parcels. This will be an impediment to achieving the objective of settlements namely increasing productivity. It is also contradictory to the important concepts using resources such as land and water more effectively and efficiently because fragmentation would cause wastage of water and breakdown of the common system of managing water. Therefore, legal transfer, if any should be subject to the minimum extent of, for example one acre in extent.
In major settlement schemes, where informal land transactions take place, as the findings of the research reveal, one group does not utilize land productively due to various reasons such as shortage of labour and capital or non availability of management capability. Another group utilizes it more productively by using their capabilities to use advanced technology, invest capital and application of knowledge. Although views have been expressed that informal land transaction in major settlement schemes should be formalized by permitting transfer of land legally into the hands of efficient operators, that would result in displacement of one category of peasants from the land, thereby becoming labourers of their own allotments by wealthy section of people either by some other farmers or outside rich land seekers which is in evidence under findings of research. In consequence, the prosperity of peasantry as a social class being an important objective of Land Commission of 1927 and the Land Development Ordinance, is thereby gradually defeated creating landless farmers.
The objective of protected tenure is to give protection to peasants as peasantry against unjust uneconomic activities. To give profits and to provide security are related, but different objectives to be achieved. There is no question that the peasants in the major irrigated settlement schemes earn their livelihood also contributing to the agricultural development of the country, when considering the vast investments made by the State. On the other hand, peasants are to be protected as an important section of the society from unjust economic activities. As producers of staple food of the people of the country - rice from ancient times to date, the peasantry must be protected by the State not only as producers, but also as a recognized social class. The peasantry must be protected until they get hold of a firm and stable position in the major irrigated settlement schemes so as to face successfully such adverse situations. The process of informal land transactions in the major irrigated scheme should not be allowed to operate to the detriment of the peasantry – displacement of the peasantry.
According to the study, the granting of freehold right to settlement land, which provides opportunity to the settlers to handle land freely without any restrictions, is an aspiration of many settlers. It is our considered view that granting freehold title at this stage, where peasantry as a whole has not yet consolidated their position as a category of peasantry, will expedite the two ways process of informal land transactions already referred to by research studies endangering the peasantry as a social and prosperous group. In terms of productivity and profitability also the informal operators were in a better position than the owner cultivators. The productivity of land which had been leased on cash prefixed produce and on mortgage was higher than the productivity of legally owned operator’s land. Therefore it is our view that some sort of formality needs be given to informal land transactions retaining at least low restrictions on tenure by the State. Where even under informal land transactions such as lease, if productivity is maintained, with the application of advanced technology, then it is reasonable to give some formality to such informal land transactions under suitable criteria and under some State control.
Profitability of irrigated paddy sector
Despite the decline of the share of agriculture in national output an increasing industrial and services sector output, agriculture still plays an important role and increasing the country’s food supply as well as providing employment opportunities specially for the rural sector. The production of rice, the staple food of the people is the mainstay of majority of households in Sri Lanka. The paddy sector has been highly intervened by the government through various policy measures over the years. In spite of those intervensions, the entire domestic agriculture sector is driven by small producers who are neither in a position to get economies of scale in the production nor to maintain sufficient surplus for the market. Irrespective of the fact that all the successive government followed some intensive measures to protect paddy farmers, as the research reveals, their living standards have been continually deteriorating over the years owing to rising production cost over the farm gate price and yield improvements.
There is no strong relationship between cash costs and paddy output. This suggests that cash costs do not necessarily enhance yield. On the contrary, management practices and level of technology are more important other than cash outlay. The results reveal that the average yield has been marginally increased (2% per year) during the past decade. Even the highest yield obtained is 5 Mt. /ha which is almost half of the potential yield of 10 mt. ha that could be obtained under well managed conditions. Examination of the data from the past decade on gross income and net income indicate that the paddy farmers real income has deteriorated over the years. Therefore it is understood that paddy farmers in Sri Lanka are currently struggling in the face of rising cost of production and unfavourable farm gate prices.
Recommendations
The recommendation can be presented under the following heads: land policy, fragmentation of allotments, encroachment of State land, informal land transactions and irrigated paddy sector.
1. Land Policy
Since the State emphasis on State land had somewhat shifted away from State ownership to State trust, it is necessary to make it clear that any government would therefore be falling short of its duty, if it neglects such a trust.
• The land policy must necessarily form an integral and organic component of whole national development strategy. It should neither be treated in isolation nor confined to State land alone, but must rather be a comprehensive review at national level. Since there are three categories of land namely land vested in the Central Government, land vested in the Provincial Councils and that of private lands, the land administration and management have to be adjusted and re-structured accordingly.
• The concept of preservation of peasantry as suggested by the Land Commission of 1927 and endorsed by the Land Commission of 1987 must still be relevant for some time to come in view of the need for protecting them from economic, social, political marginalization of which there is already adequate evidence.
• The changes in land settlement policy which has been aimed at attracting large scale private enterprise and capital into peasant agriculture would, inter alia, accelerate the differentiation of process of the peasantry. Therefore agrarian unrest would reach unmanageable proportions if no programmes are initiated to develop the small peasant proprietors on a sound basis and to increase the labour absorptive capabilities in agriculture.
2. Fragmentation of Allotments
• An amendment to the Land Development Ordinance is recommended to allow the family members to fragment the lowland in the event of death of original land owner where, there is no nomination to succeed to the land allotment. The Amendment must provide entitlement not only to the eldest son but also to any one of the family members nominated by the consensus of other family members irrespective of gender but within the minimum limit of one acre in extent for lowland and ¼ acre for highland. While the initial holder is alive too, the holder may be allowed to still fragment the allotment among the children subject to the above minimum. In both cases disposition should be effected through Land Commissioner/ Provincial Land Commissioner and Divisional Secretary.
• It is necessary to minimize pressure on land in the settlement schemes by creating off – farm employment opportunities and providing priorities for new generation people of the old settlement schemes in allocating land under new land alienation programmes.
3. Encroachment on State land
• At present the regularization of encroachment is effected through section 20A of the Land Development Ordinance as amended. Due to possibilities of irregularities and corruptions that may occur in making use of this amended section, a Circular has been issued. This Circular is Circular No. 2005/2 and dated 2005.01.25. issued by the Land Commissioner General to the Provincial Land Commissioners, Deputy Land Commissioners and Assistant Land Commissioners on the subject of ‘Forwarding Reports under Section 20A of the Land Development Ordinance for Approval’. It is recommended to strictly implement this Circular.
• However, some encroachments, specially environmentally sensitive reservations cannot be regularized. Therefore it is essential where such reservations have been encroached, action should be taken against such encroachers. It is preferable to prevent encroachments to State land by the proper exercise of powers by the Officials who are authorized to do so eg., Divisional Secretaries in their areas of authority with the definite blessings of the central political authority.
• It is imperative to devise and implement measures, long- term, island-wide, to control the problem of acute pressure of population on State land resulting in encroachment through among others, proper socio-economic measures.
4. Informal land transactions
• While there is no argument against the efficient utilization of State land, efficient utilization of State land should not give rise to displacement of peasantry from the farmland by the operation of unjust competition and illegal market operation. Private interests geared by pure economic competition should not be allowed to operate to defeat public interest. Therefore peasantry should be protected by the State by suitable means such as minimum protected tenure, strengthening institutional and extension services to them, marketing facilities, general welfare facilities until they become strengthened enough to maintain engaging in agricultural activities in the allotments on their own.
• The granting of freehold title need not be given to them at this stage since they have not yet consolidated their position as an economically safe category of peasantry. The granting freehold title would at this stage expedite the two way process of informal land transaction referred to above, endangering the peasantry as a social and prosperous group. It is also noted here that compared to original legislative form in the Land Development Ordinance, the restrictions on the controls of allotment by the allottees have been minimized today, the minimum remaining is for the benefit of themselves.
• Since in terms of productivity and profitability, informal paddy farmers maintain good standards, some sort of formality need be given to informal land transactions under suitable criteria and under State control. However, subdividing of an allotment should be maintained at the minimum of one acre in extent for lowland and ¼ acre for highland.
5. Profitability of irrigated paddy sector
As revealed in the analysis of findings at least five acres of paddy land have to be cultivated to obtain a profit level above the poverty line if present economy conditions are prevailed. Therefore it is understood that paddy income only is not sufficient to get rid of poverty if farmers continue to cultivate present land sizes. Hence it is important to prevent further fragmentation of paddy land and if possible rules and regulations need to be introduced to consolidate paddy lands. Time has arrived to go for commercial paddy farming instead of subsistence home based paddy cultivation. To improve profitability, farmers need to diversify crops in existing paddy lands. Moreover this study recommends bridging the knowledge gap of the paddy farmers, dissemination of new technology among the farmers, promoting the use of organic manure, assuring paddy farmers to receive at least prevailing procurement prices, proper management of the PMB stores, enhancement of efficient paddy purchasing and distribution programme and obtain private sector contribution in order to improve the efficiency of selling paddy and purchasing other inputs by paddy farmers under proper government control where necessary.
Concluded
(The writer is a Retd. Professor in Law, Faculty of Management Studies and Commerce, University of Sri Jayawardenapura.)
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