Department of Agriculture, Forestry and Fisheries Annual Report 2009/2010

Agriculture, Land Reform and Rural Development

11 October 2010
Chairperson: Mr M Johnson (ANC)
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Meeting Summary

The Department of Agriculture, Forestry and Fisheries (DAFF) briefed the Committee on its 2009/10 Annual Report, although it was noted that the new Director General, who had taken office only part way into the 2010/11 financial year, could not respond fully to all issues from his personal knowledge. It was also noted that Marine Coastal Management was not reported on in this Annual Report, since those functions were only finally transferred to the DAFF by the end of March 2010. The strategic priorities of the Department were linked to those of government. During this year the Department had also developed a sector growth plan, to try to speed up transformation of the sector, and create a conducive environment for contributing to economic development and achievement of government priorities. The DAFF outlined the number of posts filled, the turnover rate, and the processes around the transfer of the fisheries function. Work had been done to implement agreements with China on construction of an aquaculture centre in Free State, and joint management committees with Namibia, Zimbabwe, Kenya and Swaziland were established. The progress in forestry work, including the issuing of licences, signature of service level agreements for firefighting and drawing of lists for protected trees, was also outlined, while a Report on the Impact of Forestry on Poverty Alleviation had been submitted for design and layout. Arbor Week messages reached more than 11 million people through print and electronic media. The financial statements were tabled, and it was noted that for this year the DAFF had received an unqualified audit report, although there were matters of emphasis in respect of irregular expenditure.

Members asked whether the funding to women had related to one project or many, and also asked about what funding had been given to distressed fishermen, and called for a written report specifying to whom and how the moneys allocated were spent. They also commented that although there had been discussion that farmers should be able to access funding, there seemed to have been little development and also called for specific written reports on what the Department planned to do to assist seasonal farmers. Members were concerned that although there was a surplus of maize in the current year, there did not seem to be sufficient planning to ensure continuous food security or plans to stockpile to guard against drought or bad harvests. Although Members noted that an unqualified report was given, they remained concerned about the irregular expenditure, pointing out that it was a significant amount, and also commented that the same issues seemed to arise year after year, indicating that the Department was not doing enough to address them. They asked for further reports on the filling of vacancies, and asked why these had not been filled although there was sufficient money to do so (which remained unspent at the end of the financial year). Generally, they commented that insufficient detail was given on the allocations, and there was little evidence that the spending in some areas was producing tangible results. Members asked about the benefits of the tree planting projects in Bembe, the creation of jobs by the Department, the training offered, and whether any of the planned projects were not achievable. Members also asked the Department whether it was correct that it had failed to appear before the Standing Committee, but the Department stated that it had never been called to do so. A Member suggested that a 30-year plan for the agricultural sector should be created and adhered to, in order to ensure that the Department was working in line with specific plans and would achieve objectives. Another Member was particularly concerned that game farmers were effectively depriving agricultural farmers of land, and asked whether any regulations were planned to address this. Members asked that written reports be submitted also on the reasons why the previous Director General had left the Department.  


Meeting report

Chairperson’s opening remarks
The Chairperson welcomed Committee Members and reminded them that the Committee would be holding a series of meetings to consider the annual reports of the Department of Agriculture Forestry and Fisheries (DAFF or the Department) and its entities. He noted that the objectives of the Portfolio Committee were to ensure that there was adequate, safe and secure supply of food for all South Africans. He noted that the Committee had been concerned about a number of issues and hoped that these would be addressed in the presentation, including questions around vacancies, unspent monies, and the audit findings.

Mr Langa Zitha, Director General, Department of Agriculture Forestry and Fisheries, tabled the Annual Report, and noted that the Marine Coastal Management was not included in the report, due to the fact that during the financial year under review, 2009/10, this unit was under the full responsibility and control of the Department of Environmental Affairs.

Mr Zitha noted that the Department had linked its strategic priorities in this year to the five main Government priorities. These were boosting the economy, to create decent work and sustainable livelihoods, the rollout of programmes to build economic and social infrastructure, the need to strengthen the skills and human resource base, the rollout of a comprehensive rural development strategy linked to land and agrarian reform and food security, pursuit of the advancement of Africa, enhancing international cooperation and ensuring that South Africa could build on its own competitiveness globally.

Mr Zitha highlighted that the establishment of the new Department of Agriculture, Forestry and Fisheries (DAFF) led to a major restructuring process, which had started in July 2009. This process was only concluded at the end of March 2010, which was the end of the financial year under review, because of the difficulties encountered with the transferring of the fisheries component from the Department of Environmental Affairs (DEA).

During the financial year, the development of a sector growth plan was initiated, to speed up transformation of the sector, create a conducive environment to enhance the contribution of the sector to economic development and achievement of government priorities. The DAFF aimed to improve service delivery, through a variety of strategies.

He noted the achievements of the Department. On 31 March 2010, there were 3 307 posts. During 2009/10 the vacancy rate decreased from 17.0% to 14.8%, and the turnover rate decreased from 9.5% to 6.8%. He noted that for 2009/10 the Department had received an unqualified audit report.

He reiterated that all National Macro-organisation of the State (NMOS) processes relating to the transfer of the forestry and fisheries functions, and their concomitant resources, to DAFF were concluded on 31 March 2010. Other outstanding matters relating to the transfer of the two functions were currently being managed through Memoranda of Understanding (MoUs) agreed between DAFF and the relevant Departments of Water Affairs (DWA) and Department of Environmental Affairs (DEA).

Other achievements included the commencement of work to implement the agreement with China on the construction of an aquaculture centre in Garieb, Free State.  The Free State Provincial Government was a major partner
in this project. He also noted that Joint Management Committees with Namibia, Zimbabwe, Kenya and Swaziland were established. The Department aimed to strengthen its relationship with China, and would report further to the Committee on developments and updates.

In terms of forestry work, he noted that although there was still much to be done, there had been some significant progress during the current financial year.
315 licenses were issued under the National Forestry Act (NFA), using the Forestry Licensing and Tracking System (FORLATS). Service level agreements had been signed in respect of basic fire fighting in the Northern Cape, and 333 fire protection members were trained countrywide. A national list of Protected Trees was published through print and e-media, and a Champion Trees List was published for public comment. A communication strategy for the National Forestry development and resources had been developed and discussed with the National Disaster Management Centre (NDMC) for implementation purposes. A report on the Impact of Forestry on Poverty Alleviation had been submitted for design and layout. Arbor Week messages reached more than 11 million people through print and electronic media.

Mr Jacob
Hlatshwayo, Chief Financial Officer, Department of Agriculture, Forestry and Fisheries, then tabled and presented the financial statements and report. He noted that the DAFF had received an unqualified audit report, although there were matters of emphasis noted in respect of irregular and wasteful expenditure. He noted that R16 million of the budget in this financial year was not spent. The full allocations and spending (see attached presentation for details) were also tabled.

Discussion
The Chairperson asked whether the large funding allocated to “women” in the Department related to money allocated to one woman or many women.

Mr Hlatshwayo responded that many women were awarded the money, and the figures were reflected in the Annual Report.

The Chairperson noted that every Member of the Committee must engage with the full Annual Report, in order to ensure that good results were achieved.

Mr S Abram (ANC) said that it was a pity that the Director General who was presenting this report could not be held accountable for the activities described in it, as he was new to the post. He would only be fully accountable in fact for the 2011/2012 period.

Mr Abram wished to express his thanks for Dr Rampedi, who was not present at this meeting, for providing trees to the Department.

Mr Abram said that he was generally not satisfied with the report. The outcomes presented did not appear to be a correct and clear reflection of what had been stipulated.

Mr Abram noted the comment that the Department was unable to comment on fisheries during this period, as it had fallen under another department. He noted that in the Western Cape, fishermen were experiencing great problems with accessing permits and many other concerns, despite media reports that millions of rands were allocated to assist fishermen. The Committee must be told who were the beneficiaries of the funding, and over what period that money had been distributed and spent.

Mr Abram noted that although there had been a great deal of discussion about farmers being able to access funding, the results of this had been overdue for some 18 months.

Mr Abrams queried what measures were in place for seasonal farmers, pointing out that they did not farm all year round.

Mr Abram noted that currently there was a maize surplus in the country, and maize farmers were considering cutting their maize farming for the next season. The media reports were suggesting that the government must change its stance on biofuels. Mr Abram cautioned that the government must not compromise food security, and that it must ensure that, during times of plenty, there must be saving for future droughts or unforeseen catastrophes.

Mr Abram noted that the Department had received an unqualified audit, but said that the Department still needed to attend to the problems around lack of control and unreliability of reported performance information. He was concerned that, from one year to the next, the Department did not appear to have really engaged with the issues and instead presented a report that appeared to be a cut and paste from the previous year. Not enough detail had been given in the presentation as to how the funds had been allocated, and it was vital that the Committee should be given these details.

Mr Abram noted that shortly after the start of the current administration, the previous Director General had left, and he requested to be given the exact reasons for that departure, which had never been disclosed to the Committee. Acting appointments had been made. He questioned the logic for appointing people to positions for which they were not suitable, whilst at the same time removing them from posts in which their skills could be properly used.

Ms C Mabuza (ANC) referred to the 52 thousand trees planted in Bembe, and asked what had been the benefits of the project, and what its current status was.

Ms Mabuza questioned what job opportunities were created by the Department. She also asked whether the references in the report to “training” meant internal Departmental training, or training undertaken by the Agricultural Marketing Council.

Ms Mabuza questioned whether any of the projects planned by the Department were not achievable.

Ms Mabuza questioned why the Department had apparently failed to appear before the Standing Committee on Public Accounts (SCOPA).

Mr L Bosman (DA) complained that the report was not coherent, and failed to address all the points that were needed to take agriculture forward in South Africa. He said that in the agricultural sector, the Department was supposed to be guided by the Agricultural Sector Plan, which was developed in 2001, and which should be re-evaluated on a five-year basis, so that there was movement to reach objectives in the longer term. The backbones of that plan were economic competitiveness, transformation and proper resource management. The current reports should be identifying what was needed in each of these areas, in order to make a proper impact through implementing systems and setting in place the necessary measures. South Africa was tending to look to other countries for solutions. He cautioned that China had already taken over the South African retail sector and now he was worried that the country was also giving China the opportunity to take over the agricultural sector.

Mr P Du Toit (DA) said that there seemed to be something very wrong with the administration. He noted that there were vacant positions, yet there was also money not being spent, and he asked why the vacancies were not being filled. He was not impressed by the fact that the total report was unqualified, pointing out that there had been irregular expenditure. The Department was people-driven and the correct people needed to be appointed to do the job properly.

Mr Zitha and his team answered the questions in general terms.

He said that, in respect of funding, there were currently discussions under way about possible ways of making funding accessible to farmers. A variety of models were proposed. These would be brought to the Committee, who would be asked to give their support to the ones that were preferred. The Department was sending a team to China, to explore ways of funding small-scale farmers.

In respect of the perceived weaknesses in the Department, Mr Zitha said that an Addendum to the Annual Report presentation had been prepared, entitled “Annual Report 2009/10 Presentation – Challenges and Corrective Measures” and this identified the shortfalls and weakness, and would propose some solutions. He commented that in general the State did experience some difficulties with being fully effective. The Department would be bringing in some organisational engineers, to assist it in designing an effective system to move forward, and a workshop would be held in the following week.

Mr Zitha noted that the Department was working together with the Competition Commission to achieve satisfactory standards of production. He said that the reports on Foot and Mouth disease must not be exaggerated, as the reports from the laboratories had indicated that areas were clear of this disease.

Mr Richard Seleke, Acting Deputy Director General: Fisheries, DAFF, commented on the reasons for the fisheries sector being excluded from the Annual Report for this financial year. He noted that when the DAFF was created, there were some problems around the transfer of funds. Some of the problems were logistical problems arising from the National Treasury regulations, which governed transfer of funds from one government department to another, but others related to the wish of the transferring department to release funding only in installments over a three-year period. There were differences of opinion and some misunderstanding as to how and why certain funding was not included. Discussions were still ongoing to achieve a full transfer of all necessary funding. He added that the Department must still decide whether the programmes initially planned were still achievable, as there might not be sufficient funding to create sufficient livelihoods for fishing communities.

Mr Hlatshwayo expanded on the amounts involved. An amount of R306 million was initially allocated for social relief for the fisheries sector. However, out of that R308 million the Department of Environmental Affairs had offered DAFF only R213 million, as it stated that the R95 million was going to be withdrawn. DEA had said that it would release R71,8 million over a period of three years. DAFF would receive the first tranche of R71,8 million at the beginning of November.

Dr Emily Mogajane, Deputy Director General: Production and Resources Management, DAFF, answered the questions about the tree projects. She said that the main objective of the project in Bembe was to improve profitability of orchard production through the village. The investment had certain immediate effects. The 200 hectares planted increased production areas for emerging farmers in the area, created income for those people who planted the trees, since the trees were purchased from the local nursery, and created jobs for those planting the trees. In the long term, ten permanent jobs would be created in orchard management. Further details could be provided in writing to the Committee.

Mr Billy Morokolo, Acting Deputy Director General: Trade and Agricultural Development, DAFF, said that there were different kinds of training provided by the Department, based on the Agricultural Sector Education and Training Authority (AgriSETA) standards, and which, under the National Qualification Framework 1 and 2, focused on the basics of agricultural marketing. The Agricultural Marketing Council offered an additional course, which was outside the scope of what DAFF provided.

Mr Ramagwai Sebola, Acting Deputy Director General: Sector Services and Partnerships, said the Department was facing huge problems in extension services, and the Department was therefore driving an oversight programme that harmonised the support services from all provinces. Within that programme, an extension recovery plan had been developed, and the Department had been able to identify critical problems. Mr Sebola said that more resources were needed for this programme, as it was plagued by a lack of skills.

Mr Sipho Ntombela, Chief Operations Officer, DAFF, said that there had been difficulties around the creation of the new DAFF. A decision was taken that when all three components were finally included (including fisheries) then the restructuring process could commence properly. Until then, however, some of the vacancies had needed to remain unfilled, whilst those that would not ultimately be affected by the restructuring could be filled. The vacancy level was currently at around 10%.

Mr Hlatshwayo commented on the reports about irregular and wasteful expenditure. An internal audit report had been produced by the Department and this had been submitted to the Auditor-General. It was therefore clear that the Department had been aware of the problem, and was serious about its commitment to take whatever action was needed to correct any irregularities.

The Chairperson said the Department needed to carefully analyse what deliverables had been achieved, and assess how that balanced against the resources ploughed in. It seemed that a lot of money was being ploughed into programmes or ideas that had proven, again and again, to produce inadequate results.

Mr Bosman said that more information was needed on the production side, as much of the essential information did not appear in the audit report.

Ms Mabuza felt that the responses from the delegation had been too general, and did not hone in on the specifics.

Mr Abram also felt that the majority of the responses had not clarified the issues sufficiently. He then said that he wanted to ask further questions, but would insist upon a written response to those questions.

Mr Abram asked, in respect of the fisheries beneficiaries, for a list, in writing, of all those who benefited from financial allocations.

Mr Abram wanted a written response as to how the Department was intending to assist seasonal farmers who wanted to farm this season, not next season.

Mr Abram insisted that the Portfolio Committee had the right to know the reasons why the previous Director General had left.

The Chairperson agreed that this should be explained in writing.

Mr Abram repeated his concerns that game farming was depriving agricultural farmers of a significant amount of the land that should be freed up for agriculture, and asked whether there were, or were plans for any regulations to prevent game farmers from taking away agricultural farmers’ livelihoods.

Mr Du Toit said that a 30 year plan needed to be established as soon as possible, as the agricultural sector needed to understand where it was heading.

Mr Zitha confirmed that he would prepare written responses, and said that his verbal responses at the meeting had attempted to explain matters, to be best of his ability.

Mr Zitha also wished to place on record that DAFF had not been requested to appear before SCOPA, but would have appeared had it been requested to do so.

The meeting was adjourned



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