Hearings on Annual Report of National Agriculture Marketing Council & briefing by SA Human Rights Commission

Meeting report

PORTFOLIO COMMITTEE ON AGRICULTURE AND LAND AFFAIRS
25 October 2005
HEARINGS ON ANNUAL REPORT OF NATIONAL AGRICULTURE MARKETING COUNCIL AND BRIEFING BY SOUTH AFRICAN HUMAN RIGHTS COMMISSION

Chairperson:

Presentation of the Annual Report of the National Agricultural Marketing Council
Overview and Analysis of National Agriculture Marketing Council Annual Report 2004/05
Presentation of Land Rights Report 2002/2003
South African Human Rights Commission Economic and Social Rights 5th Report, 2002/3 [available at www.hsrc.org.za]

SUMMARY
The National Agricultural Marketing Council (NAMC) presented their Annual Report to the Committee. Several factors, such as globalisation, the need for economic support and an advisory body had determined the relevance of the Council. The Council’s activities included the encouragement of growth and development of the first economy and increasing its possibility to create jobs, increased support to agricultural activities, and increased support to agricultural activities in the emerging sector. The Council’s budget amounted to R11 162 000, and their actual expenditure was R11 162 071.

The Committee discussed trademark money, the Council’s advice to the Minister, poor attendance at the workshops, monitoring of government interventions in terms of statutory levies, the Council’s expenditure on personnel and the possibility of engaging a marketing officer in their organisation. Committee members felt that too much money was being spent on staff salaries, and that the Council was not achieving its objectives as it had not appointed a person to focus on marketing.

The South African Human Rights Commission presented the 5^th Economic and Social Rights Report – Chapter 1, to the Committee. The report stated that the Department had met the requirements of reasonableness in 2002/2003. There had been an improvement in the Department’s spending. The progressive realisation of land rights was dependent on available resources and was within targets. More money had to be found and more efforts had to be made in terms of land rights.

The Committee discussed evictions from land and the mandate of the Commission. It was felt that the Commission should focus on stopping land evictions, rather than monitoring them. The Commission pointed out that it lacked resources in that it only had one researcher.

MINUTES
Hearing on the Annual Report of the National Agriculture Marketing Council (NAMC)
Ms D Ndaba, (Vice-Chairperson) presented the National Agriculture Marketing Council’s Annual Report for 2004/2005 to the Committee. The Council has been established in term of Sections 3 and 4 of the Marketing of Agricultural Products Act, No 47 of 1996, as amended by Act 59 of 1997 and Act no 52 of 2001. This legislation mandated the Council to manage measures for the marketing of agricultural products and advise to Minister on this issue.

The relevance of the Council have been determined by several factors, such as the fast pace of globalisation, the second economy that needed more support, demand for government intervention in terms of statutory levies and the need for an organisation to advise government.

The Council’s activities included the encouragement of growth and development of the first economy and increasing the potential for job creation as they had investigated, advised and monitored the implementation of statutory measures in the agricultural sector. The Council also increased support to agricultural activities when they had conducted investigations with role-players to address problems in agricultural marketing. To increase support to agricultural activities in the emerging sector, the Council would provide marketing information to emerging farmers by holding 36 workshops nationally, reaching 3 600 farmers and distributing information booklets.

Mr N Siala (Chief Financial Officer) said the Council’s budget amounted to R11 162 000, with R10 601 000 having come from the Department of Agriculture. Their actual expenditure was R11 162 071, with personnel expenditure (R5 585 746) and administration (R2 547 825) the largest expenses. A surplus of R1 762 155 was had.

Discussion
Mr A Nel (DA) enquired about trademark money still to be received by the Wool Board.

Ms Ndaba said they had managed to collect R48 million’s worth of trademark money from Australia. The Auditor General had requested that some of the money be paid for Value Added Tax (VAT), but the Wool Industry argued that they were not meant to pay the tax. The issue was still standing as the industry had not yet received a letter from the South African Revenue Service (SARS) to clarify the matter. They were also waiting a report from the Auditor General.

Mr Nel asked if this meant that the Wool Board had not been disbanded.

The Chairperson asked the Council to check the facts on the matter and send more information to the Committee.

Mr Nel said the answer given by Ms Ndaba has not been included in the Annual Report, which should have contained all the details.

Ms Ndaba responded that she would send a report to the Committee.

Mr Nel remarked on the strangeness of there being no communication for an entire year between the defunct Wool Board and SARS. The money could have been used by the Wool Trust.

Ms Ndaba replied that a meeting had been had with the Wool Trust.

Mr J Bici (UDP) asked what issues the Council had advised the Minister on, and was concerned about an oversupply of maize in the Eastern Cape.

Ms Ndaba answered that there had been an oversupply of maize, which had been reported by them to the Minister. A plan had been in the pipeline to turn maize into petrol, but the plan had required a large capital investment. They were discouraging small farmers from planting maize.

The Chairperson asked if there were any markets open to export maize.

Ms Ndaba replied that they had been encouraging farmers to sell maize to other African countries.

Mr Bici asked how far the problem would have to extend before something was done. He asked if the Council could encourage farmers to plant something else. Farmers in the former Transkei had been trying to export maize to Zimbabwe, but had not received any help. He asked what the Council had in mind regarding investigations into the application and monitoring of government interventions in terms of statutory levies, and if they had provided marketing information to emerging farmers.

Ms Ndaba said that the Council had data on all small farmers. The budget for a market information system had been removed by the Department of Agriculture. The system would be launched in November with the Department.

Mr Bici said personnel expenditure was almost half of their budget. He asked if they could provide more details on salaries.

Mr Siala said personnel expenditure comprised of the salaries of staff and council members and amounted to 52% of their budget. Their tea girl was paid R3000 per month, and the register clerk and finance clerk were each paid R8000 per month. The lowest salary for an economist was R11 000 per month with the highest being paid R15 000 per month.

Mr T Ramphele (ANC) was concerned about the Council’s organisational structure. He questioned what had informed the structure of their objectives and where their strength in marketing was.

Ms Ndaba replied that a lot of members were economists who dealt with information, and most staff members and council members had a background in marketing.

Mr Ramphele asked how much time was spent on duties that the Committee expected the Council to perform, that is, assisting farmers with marketing. He asked how capable the Council was in performing this task.

Ms Ndaba felt that the Council was capable. They had divided into different industries and portfolios on the issue.

Mr Ramphele was concerned that agriculture lacked a structure to market products.

Ms Ndaba responded that the Council had found farmers, whom they had introduced to the Johannesburg Fresh Produce Market. The farmers were now realising an income and this was one examples of an outreach programme.

Mr Ramphele asked what the Board was doing regarding the issues raised by the farmers from the second economy. He enquired as to which part of the Council’s financial report included the levies collected.

The chairperson commented that they had targeted 36 workshops in the provinces. She asked if the programme was continuing and if they were going to reach all the farmers they had intended to meet. She asked what strategies were in place and what the stumbling blocks had been.

Mr Z Kotwal (ANC) enquired as to the languages that the workshops had been held in and questioned how these had been coordinated. He wanted to know if the workshops had links with land reform beneficiaries.

Ms Ndaba answered that they had asked the provinces to be present at the workshops, but some provinces had replied that they were too busy. The Council wanted an integrated agricultural sector to attend workshops, but they had to talk to the provinces first as they could not proceed without the provinces being on board. They had talked to the Minister about the situation, which had since improved. They were using the people’s own languages for workshops, but the materials provided were in English.

The chairperson was concerned about the problem of illiteracy, saying it was useless to distribute the material in English, and recommended that it be translated. The chairperson enquired about the poor coordination that had been mentioned.

Ms Ndaba replied that some provinces have not provided assistance. However, this had improved after May, as four or five workshops were now held every month.

The Chairperson asked if the Council employed disabled persons.

Ms Ndaba stated that disabled persons were not on their staff, as they had only a small staff of less than 20 persons.

Ms E Ngaleka (ANC) asked why the Council’s Chairperson was not present.

Ms Ndaba responded that the Chairperson had been in hospital and was still recuperating.

Ms Ngaleka felt that the Council’s explanation of their expenditure on staff was not satisfactory. She thought that

R5 million was too much to spend on salaries. She asked if they could explain their administration costs of R2,5 million.

Mr Siala answered that the administration cost involved expenditure items, such as communications, copiers, hiring human resources and renting offices.

Ms Ngaleka asked what had been done to address poverty, and questioned why the Council had a surplus.

Mr Siala replied that the Minister had approved the surplus for unfinished projects.

Ms Ngaleka commented that the "turn up" figures for workshops was very low. It was not enough to wait for the provinces, and the Council had to be proactive. It did not make sense that only 38 people turned up for workshops in the Western Cape.

Mr S Abram (ANC) said that the Annual Report had referred to long term obligations for leases amounting to R702 000. He asked how this had came about.

Mr Siala said the Council had leased offices from Old Mutual. They had signed the contract before hearing that they could use offices at the Department of Land Affairs. However, they were not able to cancel the contract.

Mr Abram asked if the Council have conducted research to determine the self-sufficiency of South African agriculture.

Ms Ndaba responded that they had conducted such research, especially on red meat, which could be send to the Committee.

Mr Abram asked if the Council had a plan to proactively assist those that required the most assistance.

Ms Ndaba said they had begun with creating new marketing schemes. A pilot plan had been developed for red meat producers, which could be sent to the Committee.

A member of the Committee asked how prepared the Council were to grapple with issues of globalisation.

Ms Ndaba said they had advised small farmers to form commodity groups, which would allow them to produce enough to apply for tenders. There was a further problem, as people did not understand the concept of tenders.

A member asked what the Council was doing to correct the skewed competition in terms of livestock marketing. The second economy needed more support. He asked if they had a mechanism to provide assistance and how emerging farmers in certain areas were reached.

Ms Ndaba replied that they had to travel out to those areas.

Dr A van Niekerk (DA) said that 96% of saleable products came from commercial agriculture, and only 4% from emerging farmers, who had to compete in the market. He asked the extent to which the Council were looking at alternative products which could be marketed both oversees and in South Africa. He said they had to increase market access to market participants. He asked to which extent alternatives were initiated to help alleviate poverty.

Ms Ndaba responded that marketing schemes had been looked at and the Council encouraged farmers to change away from traditional crops. People were encouraged to become part of the value chain of agricultural products.

Mr Ramphele asked what was being done to ensure that the challenges faced by emerging farmers were addressed. He said the Council had to seriously consider the appointment of a marketing officer.

Ms B Ntuli (ANC) said that the second economy needed more support. She asked if they were still going to provide support in the form of marketing workshops, and when and how fast this could be done.

Ms Ndaba said they had to work with the Department of Agriculture on their marketing information system, which would be launched in November.

The Chairperson asked if the Council had research relationships.

Ms Ndaba replied that the Council worked closely with the Agriculture Research Council (ARC). The organisation was being reviewed and a researcher would be engaged.

The Chairperson asked what South Africa’s competitive status was in international agriculture and what measures should be taken to compete internationally.

Ms Ndaba answered that a document had been sent to Parliament on international competitiveness. She would send copies of the document to the Committee. South Africa should perhaps increase import duties, as the country had become a "dumping ground".

Mr Abram asked if the Council had reached the stage where it could advise government. He asked what the Council were doing to protect the local industry. He felt that the Council should be proactive in ensuring that no dumping was taking place.

Ms Ndaba said that the Council had made a submission to the Tariff Board recommending that tariffs be increased. She added that there were many laws impeding the progress of small farmers.

Ms Ngaleka said that marketing had to be the core business of the Council and felt that this was not happening. She proposed that they urgently appoint someone to perform marketing. She asked the Council to go back and do what they had been expected to do.

Mr Ramphele stated that the Committee was not receiving as much from the Council as they should have been. He thought if the Council lacked marketing staff it would not be able to perform its function.

Briefing by South African Human Rights Commission on 5^th Economic and Social Rights Report – Chapter one
Mr T Thipanyane (Deputy Chief Executive Officer, Operations and Provincial Office), said the Commission had a mandate to monitor how the state implemented rights.

Mr Vusi Moyo (Researcher) said the report monitored Section 25 of the Constitution, particularly Sections 25(5) on land redistribution, 25(6) on tenure reform and 25(7) on the implementation of land restitution. There was a constitutional obligation, in terms of Section 7(2), on the state to respect, protect, promote, and fulfil the right of access to land.

Mr Moyo stated that the Department had met the requirements of reasonableness in 2002/2003, insofar as they had taken steps to institute the necessary measures to reach their targets. Projects such as the Land Redistribution for Agricultural Development (LRAD) and the enactment of the Communal Land Rights Bill were examples.

There has been an improvement in the Department of Agriculture’s spending. Their total allocation was R 1 billion. They had spent R394 million on restitution, R417 million on land reform and only R2, 2 million on tenure reform. They have had a deficit of R14 million. More funds were needed by the Department, which lacked capacity. The restitution budget was inadequate.

The progressive realisation of land rights was dependent on available resources and was within target. Plans had been formulated for development, but progress had been minimal.

The following challenges had been identified: land reform remained slow, and most land was still being owned by white commercial farmers; the market mechanism was a hindrance; limited budgets; lack of post-settlement projects; non-observance of laws; and rural claims were complex because of, amongst other things, disputes, lack of coordination, and ignorance of beneficiaries.

Mr Moyo recommended that effective after care be enhanced, funding be increased, capacity be built, the market mechanism be done away with, tenure security reinforced, that the Commission and Department of Land Affair collaborate, and monitoring systems be instituted.

In conclusion, Mr Moyo said that more efforts had to be infused in land delivery and more money had to be found. They were concerned that land reform was slow. Overarching factors were responsible for this.

Discussion
Mr Abram said that the achievements in land reform had been met with a great deal of criticism. There had been little emphasis on the quality of results. There was a need to look very urgently at financial models for post settlement support programmes. He was concerned that the Land Bank would lead people into poverty traps. The historic reason for the creation of Land Bank had been to keep land in the hands of white people. Now, when ordinary citizens approached the Land Bank, they were required to fill in forms for which they were unable to supply information, as they had been unable to establish financial records. Furthermore, the Land Bank’s interest rates were, in some cases, higher than those of other banks. He did not think that those people would become commercial farmers and believed that the focus of the Land Bank had to be changed. Interventions were needed.

Mr Bici agreed that people had a problem with the Land Bank.

Mr Abram said that opportunities had to be created for young people qualified in the agricultural sector, as people who could become future commercial farmers.

Mr Bici needed clarification on the mandate of the Commission to report to the Committee, as the report they had presented was from 2002. He asked how often the Commission should report to the Committee.

Mr Thipanyane said the Commission saw itself as a body accountable to Parliament. The current meeting was only the second time since 1996 that they had been invited to the Committee. He thought the Commission should meet more often with the Committee. Their mandate was to monitor and assess land rights. However, they could not do a proper observation with only one researcher. Some issues would be better addressed if there was greater interaction between the Commission and the Committee.

Mr Bici asked what interactions the Commission had with the Department of Land Affairs and emerging and commercial farmers.

Mr Ramphele asked if there was a system in place to assist people who had been removed from land and to what extent people occupying land were protected by government institutions for government services, and if they enjoyed human rights. He referred to a farm school that had been closed by the farmer and asked how the Commission assessed problems, and what the Department of Land Affairs was doing to protect farm dwellers. The extent to which landless people were affected by poverty was much more severe compared to those who had land. He asked if there had been an impact on the lives of people left landless by apartheid. Referring to efforts to redress the problem, he asked if the laws were adequate to pass constitutional muster, and if aexisted a course existed in terms of rural development, in the light of the small land tenure budget and incomplete spatial development.

Ms J Cohen (Parliamentary Officer) said there had not been enough resources put behind the Extension of Security of Tenure Act (ESTA) No. 62 of 1997. The Act and the mechanisms it provided to resolve disputes had to be looked at. Options other than the courts, such as mediation, had to be considered. ESTA had to be rethought in terms of its mechanism, and all relevant parties had to be involved. There was still much work to do for people who had been evicted from land. In some provinces, such as the Western Cape, ESTA forums had been set up, which brought together all relevant parties.

Ms Cohen said a report on access to the delivery of rights of farm dwellers had been published in August 2003. The report found that, in many instances, services were not reaching people. There were many issues concerning farm schools. The Department of Education had to enter into a contract with farm owners. The Commission had done much work on the issue. The Department of Home Affairs did not understand the necessity to obtain services from the farms. The Department of Home Affairs needed to be more proactive.

Regarding landless poverty, Mr Thipanyane said the problem was one of access to land. The Commission had visited the school in the Limpopo, mentioned by Mr Ramphele. The problem had not been with the farmer, but rather with government. The Commission had held a meeting with the Premier of the Limpopo.

Ms Ntuli was concerned about the people who had been evicted. She asked what the Commission was doing to help them, apart from conducting research. She asked what powers the Commission had, how they dealt with monitoring, and how they intervened as a Commission.

Ms Cohen said it was difficult to assess the number of evictions. It was debatable whether they would ever be able report the number of evictions. It has been very difficult to assess whether people were moving voluntarily. It was exceptionally difficult for farm workers in the Western Cape to move. The stopping of evictions should take place, rather than the monitoring of evictions. It was a social disaster. An effort should be made to create mechanisms that would not make it cost-effective for landowners to evict people. She wondered why the Police were not taking on those cases and why the courts were not prosecuting them.

Mr Thipanyane said the Commission had the powers to research, educate and address. They could issue subpoenas and warrants and they had the right to go to court on their own behalf or on the behalf of others. They also heard complaints. Massive problems had been experienced with monitoring systems. The Commission only had one researcher and did not have the resources to make a meaningful intervention. They had tried to put researchers on the ground, but had had to rely on reports of provincial governments.

The Chairperson said there had been a directive from President Mbeki that all land restitution claims be finished in 2005. She asked if there were recommendations on speeding up the process.

Mr Moyo said the target had been shifted to 2008, contingent on whether there was enough money. However, money alone would not resolve the issue. The Department of Land Affairs had been able to deal with urban restitution. The money allocated so far had been insufficient for restitution claims. The Department of Land Affairs was experiencing problems as they could not tell if the number of claimants they had had was correct, and more land was needed. They were collaborating with other departments, but this had to be a continuous process.

Mr Ramphele requested the Commission to move away from monitoring evictions towards stopping evictions. He asked for advice on the rights of farm dwellers against the backdrop of international standards.

Ms Ntuli agreed that there should be more interaction between the Committee and the South African Human Rights Commission. A turnaround strategy should be found with which to look at the rights of farm dwellers, so that the issue was discussed, and solutions could be found.

The meeting was adjourned.