DRDLR & Commission on Land Restitution 2016/17 Annual Report, with FFC input, and Minister and Deputies present

Meeting report

The Chairperson welcomed the Minister of Rural Development and Land Reform, Mr Gugile Nkwinti, the Deputy Minister, Ms Candith Mashego-Dlamini, Committee Members, the Director General and the entities in attendance. He said the meeting was a continuation from the Ingonyama Trust Board (ITB) and Auditor General (AG) reports presented the previous day.

Financial and Fiscal Commission (FFC): Briefing

Prof Daniel Plaatjies, Commissioner: Financial and Fiscal Commission, briefed the Committee about the role and function of the FFC. Its mandate was to make recommendations to Parliament, provincial legislatures, and any other organ of state determined by national legislation. Its focus was primarily on the equitable division of nationally collected revenue among the three spheres of government and any other financial and fiscal matters and legislative provisions or executive decisions that affected either provincial or local governments from a financial and/or fiscal perspective.

Its contemporary research strategy focused on the developmental impacts of the Intergovernmental Fiscal Review (IGFR). It noted that the rural economy was no longer just a farm economy, and the role of agriculture as an engine of growth within rural provinces was plummeting. Rural development had evolved over time to focus on space-based interventions and diversified economic activities. While growth in agricultural output had poverty-reducing effects, non-farm sectors were proving to be more powerful tools for reducing poverty. Therefore a multi-functional policy approach was needed to attain rural development objectives and also to deal with the prevailing narrow interpretation of rural development in budgeting.

There were other key functions that constituted aspects of rural development. These included education, health, roads, housing, agriculture, regional planning and development, as well as environmental protection. A full functional approach to rural development implied that these functions needed to be properly monitored and well-coordinated in the rural space.

Dr Mkhululi Ncube, Manager: FFC, said that rural development was no longer a farm economy, as rural development was evolving with multiple different sectors and departments, especially in respect of budgetary aspects. A gradual decline in the population in rural areas was also evident. Rural areas accounted for about 80% of the land and were important demographically, economically and politically in South Africa. They were home to 38% of the population, compared to 43.1% in 2001.

The majority of the poor lived in rural areas. In 2011, more than two-thirds of rural dwellers lived in poverty, compared to less than one-third in urban areas. While poverty in rural areas had declined since 2006, the rate of decline had been slower than expected. Other challenges in rural areas included infrastructure deficits, housing backlogs, health disparities, insufficient skills and educational performance, and an ageing population. Access to basic services had increased, but at a slower pace than in urban areas.

Notwithstanding all these developmental challenges, rural provinces were the main beneficiaries of infrastructure conditional grants from government. StatsSA estimated that approximately 60% of government’s total expenditure was allocated towards funding the ‘social wage,’ which included a package of free basic services to poor households which were mostly located in rural areas. The National Development Plan (NDP) identified key strategies to develop rural economic opportunities and ensuring food security, such as job creation through land reform, and agricultural development by promoting small scale irrigated farming, as well as investing in infrastructure and support services. There were also significant differences in rural towns and settlement types, which meant any rural policy adopting a one-size fits all approach was unlikely to be effective. South Africa’s worst drought in 30 years had resulted in seven quarters of negative growth in the agricultural sector.

Dr Ncube also mentioned typical backlogs in rural municipalities. The challenge of rural development, given the huge backlogs, becomes unending. On policy considerations, he said that South Africa was a water-stressed country and food security had decreased in KwaZulu-Natal (KZN). This was also in line with decreased cultivated land, leading to joblessness. The severe drought had eased in several farming regions, leading to a strong recovery over the past three quarters. 

Since the 1990s, government had spent a significant amount of resources on land reform, but land reform had had little impact on rural development. It was widely felt that much of the potential of land reform as a mechanism for rural development had gone unrealised. The FFC’s research had identified that food security in KwaZulu-Natal, Mpumalanga and the Eastern Cape had decreased due to failed projects, while in only a small proportion of operational projects had food security improved. There were also job losses as a result of decreased cultivated land, with KZN the hardest hit, with a 94% decline as a result of labour-intensive crops that had gone out of production.

Prof Plaatjies also acknowledged that fast migration was happening in rural areas, adding that inequalities in South Africa were extremely harsh, dating back from the apartheid era. Moreover, there was stubborn poverty in South Africa, especially in rural areas and among people on farms, which justified Cabinet’s policy interventions in education, economic activities and social infrastructure. He expressed concerns, however, about the President not being aware of the submission last year on rural development. He emphasised the importance of presentations to Parliament in order to help policy-making development.

The Department had done a thorough review of the National Development Plan (NDP) on infrastructure, and had realised that rural communities were marginalised in Parliamentary discussions. The FFC had also identified disparities between regions in 2017/18, and noted that those who lived in rural areas would remain poor. The Commissioner said there had been no responses to their recommendations, in particular, to improve land reform outcomes, and they were still waiting for that response.

In conclusion, Prof Plaatjies stressed the need to strengthen support and incentives, as rural development played a strong role in alleviating poverty.

Discussion

Mr M Filtane (UDM) said that the presentation had been an eye opener on various issues. However, he asked why the role of agriculture as an engine of growth within the rural provinces was declining. What was the role of municipal of municipalities in rural development, as it was not clearly defined? What were the apparent reasons for the lack of municipal involvement -- was it a lack of capacity? In line with legislative consultation, what would the FFC’s contribution or role be in that respect?

Mr T Walters (DA) said that the presentation had provided a significant analysis. However, on title deeds and long-term tenure, what was the status quo of the recommendations in front of the Committee?

Ms N Magadla (ANC) asked if there was any equality in the distribution of income. The largest share of expenditure went towards remuneration -- what was the FFC’s recommendation on that?

Mr A Madella (ANC) said that 400 000 people had been taken out of poverty, and asked how that number could be increased, taking into consideration the primary role of the Department as a research institute.

The Chairperson asked what the FFC’s observations on the budget for rural development were in relation to the national fiscus. Did the budget talk about the hot issue of land? Why there was no “bail out” on land, while there was for other issues like South African Airways (SAA) to the tune of R3 billion? Did the FFC find the issue of land resonating with the budget? How did one reconcile this? The rural economy was not necessarily agriculture, so what other tools or avenues were there for growing the rural economy? Did the FFC have a model for rural development? Had it been well canvassed? Rural development was traversal, involving health, education and sport, for example. Had the FFC checked the budget in that regard?

FFC’s response

Prof Plaatjies started by saying rural development was extremely complex. The dominance of agriculture did not necessarily imply that it was the only component. There was coordination of problems with the ministry responsible for rural development. On equality in rural communities -- there was no equalities. There used to be public works problems, but now was inequality and poverty being perpetuated? He admitted that equality was quite a problem. However, he distanced himself from the land issue, saying it was a political decision fraught with different interpretations. He could not tell or reveal his decision or view because it was not his responsibility, and if he did reveal it, the session would degenerate into a political debate. He added that he was sometimes afraid to talk about racialisation and the history of apartheid.

Dr Ncube said that grants on agriculture were under-performing. The budget for land reform was declining and there a disjunctures in wages. The budget for administration was high compared to core services in local government. There were also unfunded mandates in the Western Cape.

Ms Sasha Peters, Senior Researcher: FFC, said that the budget was constrained.

Dr Ncube said there was need for practical interventions.

Department of Rural Development and Land Reform (DRDLR): Annual Report

Ms Leona Archary, Acting Director General, DRDLR, said that in the period under review, the performance of the Department against set targets had increased form 71% in the previous year to 79%. This improvement could be attributed to improved planning and performance monitoring within the organisation. The Department had maintained its status of an unqualified audit opinion for the fourth consecutive year, whilst both the Agricultural Land Holdings account and the Deeds Trading account had received clean audits. The Department remained committed to improving controls and efficiencies and ensuring good governance overall.

The National Development Plan (NDP) vision for 2030 speaks of inclusivity and integration of the country’s rural areas which should be achieved through successful land reform, infrastructure development, job creation and poverty alleviation, with one of the driving forces behind this being the expansion of irrigated agriculture. Government had adopted a strategy of radical socio-economic transformation to deal with the triple challenge of poverty, unemployment and inequality by addressing various structural and institutional legacies of apartheid. At present, South Africa was facing many challenges within the economy and to drive inclusive growth, the nine-point plan was adopted which included the initiative of revitalizing agriculture and the agro processing value chain. Although significant progress had been made, working with the Department of Agriculture, Forestry and Fisheries (DAFF), district and local municipalities and other sector departments, much still had to be done to address the needs of the poor and marginalised communities. The Department, within the resources entrusted to it in the 2016-2017 financial year, had made a lot of strides in realising the NDP’s vision.

On land reform, the Department sought to contribute immensely to the change in land ownership patterns and to provide access to land for production. It had delivered a total of 201 430 hectares, which was inclusive of land transferred through tenure programmes, redistribution and through the settlement of restitution claims. Of this, 136 938 hectares had been allocated to smallholder farmers, contributing to the NDP target of 300 000 smallholder farmers by 2030. Although significant challenges existed within the Communal Property Associations (CPAs), the Department had made progress in facilitating compliance with legislation through the implementation of a regularisation process which resulted in 209 additional CPAs being regularised to comply with the Act. Much more needs to be done to improve the support and oversight of CPAs and in the year under review, the Department had also worked on amendments to the CPA legislation which, when approved, would see the establishment of a Registrar of CPAs.

In pursuit of radical socio-economic transformation, the Department had intensified the processing of the restoration of land rights, resulting in the settlement of 804 claims against the 615 planned land claims. In order to meet the NDP targets set for land reform, it was imperative that the organisation work towards building equity models that allow for business sustainability within the agricultural sector. One such initiative was the strengthening of relative rights of people living and working on farms, and in the year under review, the Department had succeeded in approving 20 farms benefiting 1 138 beneficiaries. This model had the potential to assist in transforming the ownership patterns of the commercial agricultural value chain, but given the complex nature of transactions, this would require additional specialist capacity, and partnerships with state entities with the necessary business skills.

The Agri-parks programme was considered to be a catalyst for economic transformation and aimed to improve access for smallholder farmers to the agricultural value chain. In the year under review, significant progress had been noted, with three agri-hubs becoming operational -- Ncora in the Eastern Cape, Springbokpan in North West, and Brandvlei (Westonaria site) in Gauteng. 53 infrastructure projects had also been completed, in collaboration with provincial Departments of Agriculture and districts at the level of farmer production support units and on farms, to support smallholder farmers. In the new financial year, it was anticipated that delivery would be scaled up across the country and significant focus would be placed on farmer mobilisation and organisation to enhance farmer participation in the value chain and the ownership model of the districts’ Agri-parks.

Regarding job creation, skills development and poverty alleviation in the rural space, the Department, had facilitated 6 169 jobs from its rural development initiative and 2 742 jobs from its land reform projects, contributing to job creation in the country. Youth unemployment remained a challenge, and through the NARYSEC Programme, the Department continues to build capacity and leadership skills for rural young people. In this financial year, 2 711 youth were enrolled in the National Rural Youth Service Corps (NARYSEC) programme aligned to the Agri-parks across the country. The development of small, medium and micro-enterprises (SMMEs) and cooperatives was a priority initiative of the nine-point plan, and the Department had succeeded in supporting 192 rural agricultural enterprises and 51 rural non-agricultural enterprises.

Lastly, on community participation and integrated governance, in the 2015/16 financial year the Department had launched district land reform committees and district Agri-park management councils, and these were now functioning across the country. Although there were some challenges emerging, these structures were beginning to create the platform for participatory development and enhanced service delivery.

To improve corporate governance, the Department had focused on the internal controls environment and had acted decisively in dealing with non-compliance, fraud and corruption. In the year under review, the Department had been engaged in a rigorous re-engineering process to ensure a streamlined, seamless delivery mechanism that should enhance delivery capacity at the provincial and district level. There was still much to be done in the fight against poverty, unemployment and inequality and the Department was continuously working on improving its delivery framework through enhanced policies, legislation and systems that made services more accessible. All sector agencies were contributing immensely to the implementation of various programmes across the country in the fight against poverty and bringing hope to the people of South Africa.

Discussion

Ms Magadla said the situation in the Eastern Cape was not favourable, and she was not happy with the DRDLR’s implementation initiatives. She proposed for a cut-off time for the session to the Chairperson due to flight arrangements.

Mr Madella described the audit as unqualified. He asked why large amounts of money were going back to the Treasury. Where were the 118 employees with disabilities located? He also sought clarification on the disability rates.

Ms Archary said the Department would provide details of where people with disabilities were located.

Ms Rendani Sadiki, Chief Financial Officer, DRDLR, said irregular expenditure did not mean money wasted, but a failure to follow processes.

Ms T Mbabana (DA) started by condemning in the strongest terms those who wanted to fast track the session, like Ms Magadla. She said MPs had a job to do and must take that job seriously or sacrifice Parliamentary oversight at the altar of flight arrangements.

The Chairperson interrupted her and disallowed the dialogue on logistics, which resulted in an exchange of bitter words between the two Members with Ms Mbabana accusing the Chairperson of being personal.

Mr T Walters (DA) supported Ms Mbabana, saying Members could not be held hostage by flight arrangements, and described the ruling by the Chairperson for disallowing the dialogue as “harsh.”

Ms Mbabama said before being interrupted, she had wanted to say that the operational and financial side of presentation was long, and that the Department had been rushing. There had been no need to rush because of a failure to follow processes -- for example, the submission’s standard procedures.

Communal Property Association (CPA): Annual Report

Mr Jeff Sebape , Chief Director: Tenure Systems, DRDLR, said community property associations were formed in terms of the CPA Act, Act 28 of 1996 in order to hold, manage and own land on behalf of their members. Section 17 of the Act required the DRDLR to report to Parliament on CPAs and the provincial associations, and how the elements of the Acts were being adhered to. The Department had managed to locate all untraceable CPAs, and was making tremendous progress in getting missing information from them. The Department expected to complete the process in six to 12 months’ time.

In the case of the Khomani San, the membership list had been developed, development plans had been drafted and the CPA was expected to hold elections before the end of 2017. The enterprises that were being developed were tourism and farming. In the other case, Barolong Boo Seitshiro had been placed under administration when the CPA collapsed because of widespread mismanagement. The administrator was close to completing her work and she had appointed a service provider to facilitate and monitor elections, which were planned for November 2017. In the case of Oppermansgronde, a mediator had been appointment to resolve the conflict within the CPA. Its committee did not seem keen to resolve problems through mediation. This was due to their access to the resources of the CPA. In the event that the current mediation effort failed, the Provincial Shared Services Centre (PSSC) had advised that the Department would recommend placing the CPA under administration.

About the legal frameworks, additional provisions had been inserted into the bill in order to enhance the protection of members’ rights. Land owned by the CPA would have to be surveyed and a diagram drawn up to facilitate the institutionalisation of the rights of members. Disqualification of certain people from holding CPA office was also part of the provisions, as well as a 60% quorum required for land transactions. Capacity would be established through the establishment of a dedicated CPA office. Furthermore, CPA strategy embodied additional fields in the register -- for instance, hectares, enterprise, and geographical location.

Another strategy was to facilitate the creation of email addresses and finalising all verification processes for CPA projects. The Commission on Restitution of Land Rights (CRLR) must update the records of hectares transferred to CPAs, as well as build and strengthenstakeholder networks. Another strategy was to assign personnel to CPA work (minimum of two per province). Conducting a skills audit on all CPAs was another key strategy proffered, as well as providing start-up resources to CPAs and conducting quarterly reviews with all district forums to check the performance of CPAs. Another strategy was to ensure training on the conduct of elections to CPA district forum members.

Briefing on Annual Reports: Chief Lands Commissioner – Commission on Restitution of Land Rights

Ms Nomfundo Ntloko Gubodo, Chief Land Claims Commissioner, said the Commission on the Restitution of Land Rights had been established to provide redress to people who had been disposed of land as a result of discriminatory laws in the form of apartheid practices and colonialism. The dispossession had happened during the 350 years of apartheid and colonialism, and the effects were now proving to be a wicked problem and inter-generational factors were exacerbating inequalities.

The Commission continued to focus on the settlement of all land claims lodged before the cut-off date of 31 December 1998. It also responds to all the concerns raised by the stakeholders over the slow pace of the settlement of claims. It had recorded significant strides in the past five years, emblematic of the fact that the Department had been able to ensure that all their annual targets were met and that the allocated budget was fully expended. The Restitution Act was amended in 2014 to allow an opportunity for those communities and individuals who did not lodge their land claims prior to the December 1998 to do so. Nevertheless, in 2016, the constitutional court, in the Lamosa judgment, had declared the amendment invalid on the basis that Parliament had not consulted adequately.

Despite the evident challenges, the Commission had been able to meet all its performance targets for 2016/17. In the year under review, it had spent 100% of its allocated budget and achieved a clean audit. It was aware of the concerns that had been raised around the pace of settlement of land claims. It would take note of the 2016 Operation Phakisa for the DRDLR amd the DAFF, to pursue innovative strategies to fasttrack the settlement of land claims lodged before the cut-off date of 31 December 1998.

The Commission sought to create awareness about the opening of the land claim process amongst all South Africans, mobilise prospective claimants to come forward to lodge their claims by the end of June 2019, provide information about the criteria and process to be followed when lodging a land claim and to update existing land claims about the government’s commitment to finalise their claims.

The Eastern Cape had performed well in achieving its annual performance plan (APP) targets for the 2016/17 financial year, despite the challenges, including limited human resources.

In the Free State, the biggest challenge in settling land claims had been that the majority of land owners had declined offers to purchase made by the regional land claims commissioner. This was further compounded by the ever escalating prices of land, which implied that fewer claims were settled at a huge cost. Moreover, landowners were disputing the validity of the claims, despite the overwhelming evidence that was disclosed to them about the research that had been conducted. Such cases were therefore referred to the courts at huge cost which could have been used to settle the outstanding claims. There were also delays in the appointment of valuer/s and the determination of prices by the office of the Valuer-General.

Gauteng province had managed to achieve its settlement target for the year under review by settling the projected 24 land claims in the APP. The office had set a target of 31, and had overachieved by finalising 78 land claims. In Kwazulu-Natal, the challenges that confronted the process of land claims was the moratorium on the filling of vacant posts and for the two financial years, there were no district managers in two regions, resulting in there being no leadership in the management of land claims in five district municipalities. Lack of funding also exacerbated the problem, as the Department was not able to appoint officials in acting capacities. The matter was raised internally and there had been an assurance that it would be addressed in the new financial year.

Limpopo had managed to exceed its targets and contribute to accomplishing the objectives of the state as far as land claims were concerned. The office managed to meet its settlement target by settling 122 land claims against a target of 54. Also, 127 finalised land claims were archived against a target of 54, as well as 15 approved phased claims against a target of 16.

Mpumalanga had ventured into outreach programmes to update the claims with supporting documents, entered all manual captured claims into the lodgement system, held outreach consultation meetings informing claimants about the court judgement and provide them with status reports through letters on the status of their land claims.

The Northern Cape Province had not met its target in relation to the number of claims finalised and the number of claims lodged by 1991 researched.

In North West, the office managed to settle the complex financial compensation land claims.

In the Western Cape, the office managed to settle 356 claims, and 358 claims were researched with limited resources.

Discussion

Mr Robertson said communities were fighting on who should be in CPAs and who should not be there. He asked how one initiated verification -- who was coming in, and who was coming late? Irregularities were happening on the ground and there was confusion among the beneficiaries. There was frustration among the people on the ground, for example, in Mpumalanga, and he wondered if it was the Committee’s or the community’s questions that were not being answered.

Ms Mbabama asked if the information presented could provide a comprehensive data base of all the CPAs in the country? She also sought clarification on the selling of land under duress and the beneficiaries. On CPAs selling land, she asked if there was any follow up on why people did not have title deeds. Were those working in either the Department or the Commission not dedicated? If external people were involved, did the Department put this out to tender?

Mr Madella asked why there was slow pace of progress, and suggested that two CPA personnel per province was insufficient.

Mr E Nchabeleng (ANC) asked what was being done to get back the 25 farms that had been sold illegally. He said there was something wrong with the system.

Mr Walters raised a similar concern, citing institutional problems, and said there was need to ensure the institutional framework was in place. He raised a point of order – could the Committee create space for complaints?

Ms Magadla once again proposed that responses should be in made writing because of time concerns, specifying traffic congestion to the airport as the rationale behind her suggestion.

The Chairperson’s decision seemed to swing towards her proposal. He said the Department must respond by end of next week, since the Committee was doing an annual report.

Ms Archary responded to Ms Mbabama’s question on the human resources issue related to title deeds, and said people were not only working on the CPAs. However, she said the Department had taken note of the need for adequate resourcing.

In response to Mr Robertson, Mr Sebape said he was afraid of speculating, but the Department would provide the information in writing and ensure that the data base was complete. He said the acting DG had responded on the human resources issues.

Ms Archary and the Chairperson agreed that the Constitutional Court issue was technical. She confirmed that in the case of external employees, there was a tender and adverts were serialised in the newspapers.

Ms Vuyiswa Nxasana, Acting DG: Land Tenure and Administration, responded on the Department’s model. She said it was premised on a rural economic transformation model, and was also embedded in the communal land tenure policy as well as the communal land tenure bill. The Chairperson requested her to follow up with copies of that policy for the Committee.

Mr Robertson commented that matters might get out of hand soon with regard to the claims for getting back the land.

Ms Mbabama asked about the list of vacancies. Was it for the deputy commissioners?

Mr Nchabeleng asked why people were not benefiting from alternative land. How many people with disabilities did the Department have, and at what level? As a way to incorporate more people with disabilities, he recommended that adverts should be more specific.

In response, the Commissioner said the Department did transfer claims on state land. When it was state land, the Department accounted for it. She said there was no need to fill the advertised posts swiftly unless the Department had clearly set a deadline.

The chairperson sought consensus to wrap up the session. He sternly warned the Commissioner not to fire people “willy-nilly” -- there had to be due process.

He said this Parliamentary session was about annual reports, and with time constrains, it was not easy. The committee would identify findings and report them to the House. He referred again to the issue of land, describing the unimaginable propositions regarding land as scary. He asked how to ensure that people regained confidence in the system? He requested the Minister to give the last contribution to the meeting.

Minister Nkwinti started by thanking the Members, saying he appreciated that he had learned more about the Department. He quickly responded on the land issue, which he said the ministry would engage on. He said people wanted land, not for food production, but to build shacks. The ministry was going to face a serious crisis of under-claiming, and he commented that unlawful occupation of land was being allowed. Land did not need emotions to deal with. It was going to be a herculean problem of how to destroy or deal with state of the art buildings being constructed on unlawful land. There were not only legal or technical implications, but there was a need for social interventions also.

The meeting was adjourned.