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Business News of Saturday, 26 January 2013

Source: B&FT

Miners, communities tussle over compensation

The Minerals Commission says disagreements concerning payment of compensation to persons whose assets have been affected by mining activities have become a major problem in the industry.

“There have been instances of disagreements, misunderstandings and mistrust between the traditional authorities and mining communities on one side and the mining companies on the other, as a result of inadequate payment of compensation to the beneficiaries.

“The new minerals and mining compensation and resettlement regulations, LI 2175, prescribes compensation payments for lands, crops and buildings affected by mining,” said Isaac Abraham, Head of Public Relations at the Commission.

He said LI 2175 stipulates that “the owner or lawful occupier of any land subject to a mineral right is entitled to, and may claim from the holder of the mineral right, compensation for the disturbance of the right of the owner or occupier…”

But, he added, some chiefs and opinion leaders of mining communities sometimes go behind the rules enshrined in the LI to renegotiate with different terms -- sometimes leading to conflicts with mining companies.

The Catchment Areas Farmers Association in the Western Region recently called for transparent and scientific rules and procedures for the determination and payment of compensation to farmers affected by mining.

According to the Association, a study by Cesult Consult Service in 30 mining communities in the Western Region has found that the current policy for determining the value of crops and farms affected by mining is not transparent and scientific enough.

Farmers spend fortunes to establish their farms but receive little compensation after their farms have been displaced by mining activities, leading to the loss of property and revenue, it said.

The Association criticised weaknesses in existing laws and regulations for the compensation of people displaced by mining.

Mr. Raphael Kwasi Fordah, Chairman of the Association, in an interview with B&FT explained that there is no universal model of what could be accepted as adequate paid compensation.

He said the study by Cesult found that gold mining activities have since the late 1980s been the major cause of displacement of people, who are politically weak compared with mining companies that have the support of governments and politicians.

“The study revealed that the majority of respondents did not have a strong educational background that could have aided them in any meaningful negotiation with their richer claimants. Given their educational background – middle-school certificate holders -- it is apparent that outside interference may have crept into negotiations with their richer claimants.”

He said institutions such as the Lands Valuation Board must be encouraged to institute valuation mechanisms that will guarantee the appropriate values for both tangible and intangibles assets of individuals and communities in matters of expropriation by richer claimants.

He pointed out that whereas there are no strong expropriation laws in Ghana, the expropriation laws of India, for example, have explicit models to facilitate the payment of compensation where necessary.

“These expropriation models could be grafted onto the ones operational in Ghana to ensure fair and adequate paid compensation,” he said.

Besides being the only medium by which conflicts arising from involuntary displacement and resettlement can be resolved, adequate paid compensation can enhance the opportunities of individuals and communities to improve their standard of living -- by increasing their degree of access to social infrastructure such as quality education, health care, water and sanitation.

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