Minister of Agriculture, Land Reform and Rural Development Budget Speech, responses by ANC, EFF, IFP, FF+, ACDP & DA
21 Jul 2020
Minister of Agriculture, Land Reform and Rural Development, Minister Thoko Didiza, gave her Budget Vote Speech on the 21 July 2020
Honorable Deputy Ministers Mcebisi Skwatsha and Sdumo Dlamini;
Honorable Members of the Portfolio Committee on Agriculture, Land Reform and Rural Development;
Ladies and Gentlemen
Honourable Chairperson and Members of Parliament we meet here today to reflect on the adjusted Budget of the Department of Agriculture, Land Reform and Rural Development and its impact on the delivery of service. In February, 2020 when the President tabled the State of the Nation Address and presented what government will do in this financial year followed by the presentation of the budget, no one would have known that the disruption caused by COVID-19 pandemic would be of such proportion across the whole society. As we continue to go about our responsibility, we cannot forget to remember those who have departed and those who have been affected by this pandemic. May their souls rest in eternal peace and may those who are infected and affected get necessary support.
Chairperson what emerged as a health pandemic has had an impact in people's livelihood and the functionality of the economy across the globe. The responses by a number of countries in containing the disease resulted in countries insulating themselves from perceived threats by closing borders. These interventions also created the space for countries to develop strategies for how they will manage the disease. These interventions have had united consequence to the economy and people's livelihoods. In essence, this is a road less travelled where no one had experience as the spread engulfed all of us at more or less the same time.
In our own country we declared the National State of Disaster that restricted the movement of people and curtailed economic and social activity. Our government ensured that the farm sector must remain opened to ensure accessibility of food in our country as well as the region. We wish to thank the farmers and farm workers who selflessly continued to work during this period in order to save most of our people. We cannot forget those farm workers who lost their lives at the early stage of the lockdown as they went to work in a car accident. We are aware of some farm workers and farmers who have been affected by the pandemic and to them too we extend our support.
There are challenges given the intricate linkages that agriculture has with the other critical sectors of our economy. A majority of our farmers market is domestic. The closure of some of the sectors of our economy to this date means a loss of market and threat to job and tenure security for our farm workers. As the Department of Agriculture, Land and Rural Development, COVID-19 became an added blow given the challenges that we were already facing in respect of drought, animal and plant disease outbreaks. In the previous months we have seen the impact of COVID-19 to food security in our own country, in the continent and globally. In our own country it has shown the fault lines that still exist in our agriculture and food system.
As a government, we made interventions to cushion smallholder and commercial farmers from the disruptions caused by COVID-19. Small holder and subsistence farmers were assisted though production inputs, animal feed, agricultural remedies and livestock stock remedies through the voucher system. The large number of applications received was an indication of the high demand for financial assistance by our farmers and also highlighted the limited resources that are available to service this demand. The R100 million set aside for Commercial farmers were affected by the challenges at the Land Bank. I wish to assure the members in this house and commercial farmers funded by the Land Bank that this matter is being resolved and they will be advised on how to pay for this intervention.
Policy direction for the year 2020/2021
Chairperson, during this year we as a department have committed ourselves to accelerate effective land reform in our country. This commitment is underpinned by the following approach:
(a) Rapid release of state land;
(b) Acceleration and resolution of the old order claims;
(c) Ensure the compliance with the court order in respect of labour tenants;
(d) Development of Communal tenure legislation;
(e) Post settlement support to those who receive land through land reform;
(f) Strengthening Land administration system;
(g) Focus on youth and women;
(h) Improve market access and prioritize the implementation of the Africa Continental Free Trade area; and
(i) Strengthen governance and proper management of public resources
The advent of COVID-19 has also compelled our country to rethink and readjust budget allocations for competing needs during this period. The initial allocation for Department as per the February 2020 Budget Vote by the Minister of Finance, Honourable Tito Mboweni was R16.8 billion. This budget was re-adjusted to R14.4 billion during the Supplementary Budget Vote on 24 June 2020, a reduction of just under R2.4 billion. We are appreciative that these cuts did not affect critical Medium Term allocations for biosecurity and supporting exports amounting to R495.1 million and R500 million to finalise land claims.
Furthermore these cuts were not extended to the Agricultural Research Council which was already experiencing cash flow challenges.
Chairperson the R14.4 billion allocation for the 2020/2021 budget for the Department also includes transfers to Provincial Departments of Agriculture as part of the division of revenue. These allocations relate to-
(a) Ilima/Letsema Conditional Grants – R428 million;
(b) CASP Infrastructure Grant – R965 million;
(c) CASP Upgrade of Colleges – R25 million; and
(d) CASP Extension Services – R214 million;
The other transfers are to our agricultural entities such as the Agricultural Research Council, which received a grant of R1,271 billion. The National Agriculture Marketing Council received an amount R47,4 million and the Ingonyama Trust received an amount of R22 million.
The impact of the budget cuts
The cuts in the budget meant that we had to deal with very difficult trade-offs in our effort to as far as humanly possible, have minimal negative impact on the delivery services within the sector. The greatest portion of the cuts of R1.89 billion within the Department was in the programmes that deliver on Food Security, Land Redistribution and Restitution. These programmes are core to achieving outcomes in food security and achieving economic transformation priority through redress and equitable access to producer support. Food Security had cuts of R939 million, Land Redistribution and Tenure Reform R544 million and Land Restitution R403 million.
The Food Security program in our budget comprise of the transfer allocations from the national Department as covered by the Division of Revenue Act. The Ilima/Letsema and Comprehensive Agriculture Support Programme (CASP) budget readjustments will mean that for the 2020/2021, provinces will receive lesser allocations for producer support for production and infrastructure. Provinces will therefore need to reprioritize projects for this financial year. In terms of Land Redistribution and Tenure Reform the land development support was scaled down and this support will be extended to the identified 146 projects within Pro-Active Land Acquisition Strategy. The other applications relating to land support will only be considered in the 2021/2022 financial year. Relating to land acquisitions, new projects will not be considered and no new valuations will be conducted on land for acquiring. The current funding will only cater for current commitments.
Our Rural Development budget had a cut of R199.7 million and this will negatively affect Rural Social Infrastructure, which includes the revitalization of irrigation schemes. This coupled with the cuts in the CASP infrastructure allocations will lead to delayed implementation of on-farm infrastructure projects. The focus for this financial year will be on the completion of multi-year infrastructure projects and those that started in the 2019/2020 financial year. The Economic Development, Trade and Marketing programme had a R135.9 million cut which will lead to reconsideration and prioritisation of projects within the agro-processing, marketing and rural industrial development space. We will work with the DTIC and Dirco to ensure that our focus of trade promotion continues.
Part of these cuts included R300 million cut relating to the Compensation of Employees. This will delay our drive towards fully capacitating the department towards building a resilient sector. Notwithstanding these cuts, we will strive to fill critical vacancies in the core delivery areas of our Department during this financial year. Furthermore the department has scaled down the budget within non-core areas. The provision of resources such as ICT equipment, procurement of uniforms and training will only happen as a matter of necessity. Travel, subsistence and accommodation budgets were reprioritized taking into consideration the restrictions on movement due to the risk adjusted approach to control COVID-19.
It is not only the budget cuts that will impact on the services of the Department but the spread of COVID-19 is also having an impact on the services that the Department renders. The Commission on Restitution of Land Rights is facing challenges due restrictions in terms of meeting claimants, conducting research and verification, accessing claimants relevant documents, signing of settlement agreements and concluding on offers. These challenges are mitigated but are having an impact on the access to Departmental services and the agility of the Department to deliver.
Presidential Stimulus Package
Apart from the cuts, H.E. President Ramaphosa, announced an economic recovery stimulus package of R500 billion in April 2020. Within this stimulus allocation of R100bn was set aside as Employment Stimulus, aimed at for job creation and retention of current jobs. Agriculture as the sector with a relatively higher job creation multiplier effect than most sectors, had a set aside the R688 million which we have factored into our Annual Performance Plan. This allocation will be utilised to support 50,000 subsistence producers with an allocation of R12 000 through a voucher system in the peri-urban and rural areas.
The SONA commitments
The commitments that were H.E. President Ramaphosa on Agriculture, Land Reform and Rural Development will proceed as planned during this financial year. A snapshot of current progress in terms of these commitments is:
(a) The process to release around 700 000 hectares of state land for agricultural production has begun and to date, the Department has allocated 135 000 ha;
(b) The Beneficiary Selection Policy was published in the Government Gazette for a sixty day comment period in the first quarter of this year. The Policy will be processed to Cabinet for approval in the last quarter of 2020;
(c) Government, together with its entities, has been reviewing the legislations which would make commercialisation of hemp possible. In terms of the Department, the draft regulations on the listing of hemp in terms of the Plant Improvement Act and the Plant Breeders’ Rights Act will be published for comments in the month of August 2020;
(d) In piloting the District Development Model, the Department had already accommodated an intake of 1001 youth to this programme from eThekwini, OR Tambo and Waterberg.
Chairperson, we will furthermore strengthen our regulatory framework, the following Bills will be submitted for consideration by Parliament 2020:
(a) Plant Health (Phytosanitary) Bill;
(b) Agricultural Produce Agencies Amendment Bill;
(c) Agricultural Product Standards Amendment Bill;
(d) Preservation and Development of Agricultural Land Framework (PDALF) Bill; and
(e) The Upgrade of Land Tenure Rights Amendment Bill.
Chairperson, the COVID 19 pandemic and subsequent shut down of economies across the globe has necessitated a revision of estimated economic growth projections and human development indices. South Africa is no different in terms of the experience but we can utilise the threat provided by COVID-19 to reimagine land and agrarian reform in South Africa. We are known to be a resilient nation and we will emerge stronger and better post COVID-19.
Deputy Minister Sdumo Dlamini: Agriculture Land Reform and Rural Development 2020/21 Budget Speech
22 Jul 2020
Honourable Speaker Honourable Minister Didiza
All Ministers and Deputy Ministers present Members of the Portfolio Committee Honourable Members of the House Esteemed Guests
Officials of the Department Ladies and Gentlemen
Honourable Speaker, we speak here today being humbled by the practical experiences and the conditions imposed by COVID-19 which have reminded all of us in a more practical way that Frederick Engels and Karl Marx were correct in asserting that “ mankind must first of all eat, drink, have shelter and clothing, before it can pursue politics, science, art, etc …”. This is what our work is about in the department of Agriculture , Land Reform and Rural Development .
We are about getting our people to develop an economic relationship with their rivers, the glades and the tributaries , we are about making our people to reconnect with their environment and see the possibility of building wealth from the rising of the sun and ,the possibility of life from the soil , to see the possibility of building pharmaceutical empires from the leaves , to see the possibility of clothing and textile from plant stems and trees , and not only to treat their live stocks as a symbol of cultural pride but to see it also as a gate to endless economic opportunities. We want our people to go beyond being the providers of raw materials but to participate in the entire value chain from their own natural resources .
If I were to paraphrase comrade Chris Hani , we are not about big concepts and heavy theory. We are about decent shelter for those who are homeless. We are about water for those who have no safe drinking water. We are about health care, we are about a life of dignity for the old and safety for our children. We are about overcoming the huge divide between urban and rural areas.
We want to see the interconnectedness between commercial farming , subsistence farming , local business including chain stores. We want to ensure an interlink between agriculture and manufacturing , processing including construction . We are destroying the artificial wall between the rural and urban economy
Honourable Speaker, we have come here inspired by the people’s vision inscribed in that noble historic document , the Freedom Charter which instructs that “ Restrictions of land ownership on a racial basis shall be ended, and all the land re-divided amongst those who work it to banish famine and land hunger;
The state shall help the peasants with implements, seed, tractors and dams to save the soil and assist the tillers;
Freedom of movement shall be guaranteed to all who work on the land;
All shall have the right to occupy land wherever they choose;
People shall not be robbed of their cattle, and forced labour and farm prisons shall be abolished.”
In this context , Honourable Members, I would like to draw the attention of this House to the following specific commitments in the 2020 / 2021 Annual Performance Plan that the Covid-19 Pandemic has forced us to revise.
- Farmer Production Support Units: FPSUs
Honourable Speaker, the work was started by our predecesors to facilitate Integrated Spatial Planning in rural areas to ensure that there is alignment between sector departments, parastatals, private sector and the municipal development agenda, and this strategic focus continues under this new Department.
With the launch of the Disrict Development Model which is aimed at ensuring strategic coordination and allignement of government work at all levels , it is clear that integrated Rural Development Plans (RDPs) have become an imperative for making the required impact in rural communities .
Our strategic objectives remains that of taking forward the work of establisging Argi- Parks and as part of being realistic about this task , we have decided that the strategic point of depature should be to establish Farmer Production Support Centres, with services aimed at assisting households and farmers to improve the productivity of their assets: land and Livestock in particular.
This will assist in ensuring that we are able to map the economic potential in each and every district based for an example on studying various soil types and climatic condtions. We will know how many farmers exist in each district and their specific areas of focus . This will allow us to determine in advance the type of support and programs to be directed to relevant existing entities.
Our approach is informed by the fact that “the overriding spatial challenge is overcoming the legacy of apartheid, densifying and integrating urban and rural development nodes and activity corridors. This requires government departments and spheres to work together in new ways that achieve coordinated impact”. ( ANC 54th National Congress Resolutions : 20017 )
In this context , this year we intend to ensure that no less than 15 Farmer Production Support Units are provided with the necessary infrastructure for making them functional.
As a department , we have crafted the Comprehensive Land and Agrarian Strategy (CLAS). This strategy focuses on developing Commodity Corridors and Commodity Production Schemes in each District, thus giving districts their competitive advantage. We want to have a clear mapping and understanding regarding the strategic economic position and competitive advantage for each district.
*For an example, through our Partnership in rural Cotton Production Scheme with the Agricultural Research Council and Cotton-SA, we have, thus far, supported 1 270 cotton farmers in 90 Cooperatives in the training, production, packaging and marketing of cotton in Mpumalanga, Limpopo and KwaZulu Natal.
Our Farmer Production Support Unit in Nkomazi at Mpumalanga is the fastest growing in the cotton production scheme thus far. It supports over 29 Cotton producing rural Cooperatives with a total of 938 members cultivating just over 1 500 Ha of rural crop fields. We intend to bring an additional 3 000 Ha of rural fields in to production in the next two years, thus involving more rural households into self- employment.
Cotton production is labour intensive. Currently we are achieving job creation of between 1 and 2 persons per hectare.
*Through our collaboration with the National Wool Growers Association we are supporting over 40 000 wool producing small farmers and subsistence households in over 1 400 rural villages in just the Eastern Cape alone.
South Africa produces over 50 million Kgs of wool annually. 13% of that,( that is, over 6,5 million) is produced by rural village farmers in the few districts we are engaged with in this partnership with the National Wool Growers Association (NWGA)
Based on the latest figures for 2019 / 2020 which we have received from our strategic partner, the National Wool Growers Association , more 240 000 family members of the village wool growers are benefiting.
Our development and upliftment interventions are simple. We remove old unproductive rams from village flocks and replace them with high quality rams for improved wool production for the international market. 49 000 rams have been distributed since 2002. 80 000 rams are our target in this MTSF. 350 Wool Shearing Sheds have been dilivered; We have provided Wool-sorting and Weighing Equipment, We are providing training in no less than 13 Learning Areas in basic wool sheep production to rural wool farmers;
I this regard we would like to congratulate Bongolwethu Mgedezi who received the First Place in the latest World Sheep Shrearing Championship Semi-Finals; Mayenzeke Shweni who took Second Place and Bonile Rabela who was on the Third Place.
Rural wool grower are now participating in international wool markets. These include Italy, Hong Kong, the Czech Republic, Germany, the United States of America and France. International sales of wool from rural wool producers fetched over R339m during the 2018/19 financial year.
This commodity scheme is impactful: Over 9 000 jobs have been created; 126 Temporary jobs provided through sheep shearing infrastructure; 84 through fencing; 832 Sheep Shearers trained. Between 2004 and 2015 the number of Children going to bed hungry have been reducd from 41% to 24%; Households involved in Savngs have increased from 49% to 84%; Households that have to borrow money for school fees have drpped from 77% to 48%.
*By the end of next year, the Department’s cooperative Agreement with two organizations in the Goat Agri-Business Programme which include Mdukatshani and the Heifer Southern Africa, in Kwa-Zulu would have attained the goal of reaching and including around 7 000 rural subsistence households in improved goat production and marketing. We are assisting rural goat farming hoseholds in 5 out of 10 Districts in KZN so far.
The aim of the collaboration we enterd into in 2016, is to increase rural goat production and to commercialize rural goat herds. By the end of 2020 / 2021 we shall have increased the number of Youth Micro-Businesses to 700.
*Our rural Commodity Schemes in Sugarcane last year, supported up to 6 404 Small Growers that are affiliated to the South African Farmer Development Association (SAFDA) and more than 10 527 Ha of rural crop fields into production. The target is to reach over 14 000 Small cane growers in KZN , the Eastern Cape and Mpumalanga in the next two years.
To-date we have supported well over 750 rural livestock producers in quality red meat production through their value chains in our collaboration with the National Agricultural Marketing Council. This support includes amongst others, the construction and the equipping of Custom Feedlots in villages to supply quality meat and marketing.
The new Department is fully cognizant of the need to gradually discourage rural producers from the anti-developmental dependency on grants, year after year. This is why, under the Comprehensive Land and Agrarian Strategy, our focus will be on facilitating a process of organizing rural farmers into commodity associations that own Cooperative Finance Institutions, for sustainable productivity.
This year we shall add another 12 rural village based Custom Feedlots (CFLs) to the 19 we have completed in the last two years. These Custom Feedlots serve as Farmer Production Support Units dedicated to the improvement of rural livestock.
The farmers’ own cooperatives are governing and co-managing the Custom Feedlots with the Agricultral Graduates we are employing in support of the National Red Meat Development Programme. Farmers have opened Savings Bank Accounts and have agreed to devote a percentage of their livestock sales towards achieving long-term financial sustainability. The rural livestock farmers shall supply well over 1 500 animals this year into the export market. This market offers more than 29% above the local red meat market. We started by shipping 65 animals to Mauritius in June this year and generated R717 000.00.
The 29 Auctions we are planning this year will take us even closer to the goal of financial sustainabilty.
Our leading Farmer Production Support Unit so far is the Makholokweng FPSU in the Free State’s Thabo Mofutsanyana District Municipality. We have supported over 58 rural village farmers and Land Reform beneficiaries in the grain commodity production scheme. This will help bring 2 200 Ha of land into the production of Sugar Beans for the national and export markets. The Sugarbean harvest has gone well this year to meet the expected 2 640 Tons. Farmers have negotiated and exceeded the expected price of R12 500 per year to achieve over R14 000.00 per ton.
The support generally provided through a functional Farmer Production Support Units includes mechanisation, equipment, management, mentoring, production inputs such as fertilizers, seeds and seedlings as well as Skills Development.
The National Rural Youth Service Corpse
Honourable Speaker, the young and rising generation constitutes a representative of the future in the broadest sense; the future of any society depends on the practical and spiritual moulding of the youth. Classes and strata act not only for their own good but also for the good of their rising generation. The youth grows and is moulded within a specific social environment - be it in the comfort and sleek surroundings of the capitalist home, school and boardrooms, the squalid conditions of the working class ghetto, the backward and wretched environment of the rural poor, or the confines of a petty-bourgeois upbringing.
The stage of youth is one of assimilating knowledge of all kinds. Avidly searching for a rational understanding of the surrounding world, the youth therefore displays curiosity, rebelliousness, impassioned and uncontrolled enthusiasms; it quickly forms judgements as it abandons others. Such a stage is crucial in the moulding of stable social being; thus all classes and strata wage relentless battles for the hearts and minds of the youth.
The youth is as enthusiastic in its search for knowledge as it is militant in the fight for the realisation of the ideals it holds dear. Having evolved an understanding of the right and the wrong`, it displays great zeal and verve in fighting for what it conceives as just. Within the different class formations it acts as a powerful driving force, a dynamo of the class, national and international battles. It is to be found in the front trenches of practical and theoretical struggles displaying both initiative and self- sacrifice. (The Role and Place of the Youth in Society, the ANC and the Struggle :1985 )
We therefore saw it important that as part of driving rural development , it is both inevitable and strategic to place young people as strategic role players in this developmental work. We want their endless energy , we want their endless ideas , we want them to dream with us . Work with us to the future where we can actualise rural development
In this regard , our strategic point of depature is Skills Development which we see as the bed-rock of rural productivity. This is why our focus on the engagement of rural youth in the system of improving rural living is of such principal importance.
Honourabe Speaker, as of today, a total of 12 862 youth since 2010, have been certified (graduated) in skills development programmes across nine economic sectors. A further 1 916 AA youth have completed their training and will receive certificates during this financial year.
Currently, there is a total of 1 464 youth participating in various skills development programmes across our nine provinces. These include programmes such as Animal Production, Plant Production, Poultry Production, Fresh Meat Processing, Environmental Management, Occupational Hygiene and Safety, Clothing, Textile, Footwear and Leather Manufacturing Processes, Construction, ICT Systems Development, Fire and Rescue Operations, Road Transport and Water and Wastewater Process Control Operations.
Post the two year programme, the youth must be involved in economic activities that will bring about sustainable livelihoods, not just for themselves but for their families and communities at large, as Agents of Change for socio-economic transformation.
Young people have to know the development priorities of their own communities. They must be actively involved in mobilizing their own communities to participate in planning, identification and prioritization and implementation of their own development initiatives.
We expect NARYSEC youth, to be involved in economic activities that will bring about sustainable livelihoods, not just for themselves but for their families and communities at large, as Agents of Change for socio-economic transformation.
Madam Speaker, Here are the rural development specifics which the Departmet is committing in the remainng months of this financial year:
- Budget allocation for rural infrastructure development is R495 Million, this includes infrastructure to support the 15 Farmer Production Support Units already mentioned.
- A total of 1 001 youth were recruited during January 2020, as part of the DDM pilot projects in OR Tambo, eThekwini and Waterberg districts. The NARYSEC budget of R273 Million for this financial year will be, amongst others, utilized for sipends and training of these DDM youth, as well as other youth who were recruited in 2018 and 2019 and who are still in the system.
- An amount of R7 Million will be used in Technical Research and Development.
- All of the above initiatives will contribute to improved rural livelihoods and job creation
Honourable Members, allow me to conclude by thanking you all, in particular the Portfolio Committee for its continued support , effective oversight role , vigilance and guidance in our rural development efforts. We promise to redouble our efforts as we deal with the impact of the already existing reality of poverty , unemployment and inequality which has now been compounded by COVID -19
As frantz Fanon taught us “ “Each generation must discover its mission, fulfill it or betray it, in relative opacity.” As this generation we have taken rural development as our mission and we will do our level best , with the limited resources to fulfill it !
I thank you all!