Committee Report on Department of Agriculture, Forestry & Fisheries Strategic Plan & Budget 2011

Agriculture, Land Reform and Rural Development

12 April 2011
Chairperson: Mr M Johnson (ANC)
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Meeting Summary

The Chairperson briefed the Committee on an invitation extended to the Committee to attend a conference of the National Farmers’ Union. However, NAFU had been split shortly before the conference by divisions, and on the evening prior to the conference the former management had obtained an interdict against the other faction from continuing to run the conference under the name of “NAFU”, and the programme had been changed. Committee Members, because they did not wish to be partisan, had decided that they could not attend, once made aware of this, as it wished to support one united farmers’ union. Members decided to call for a further report on the situation, and on any amounts that the Department of Agriculture, Forestry and Fisheries (DAFF) had paid by way of sponsorship, after which they would report to Parliament.

The Committee then considered its draft Report (the Report) on the strategic plan and budget for 2011 in respect of DAFF and its entities. Members agreed that, wherever appropriate, the word “must” would be substituted for “should”. Members focused on wording the recommendations for each entity. In respect of the Department, a number of reports were to be presented to the Committee, asking for specific details, noting the need for a coordinated training programme, and how interventions would proceed. The Department was also to provide an Annual Performance Plan, including a plan for each province. The Committee was also concerned with why the Agricultural Research Council (ARC) had been under funded for so long. Recommendations were also included for Onderstepoort Biological Products (OBP) again stressing that it needed more funding, and reports on selected issues were to be submitted to the Committee by the end of May. In respect of the ARC, the Committee insisted that there must be dramatic changes in the funding mechanism, and more focus on what services ARC could provide to other entities.

Members had previously been very concerned about Ncera Farms and it was reflected in the draft Report that the strategic plans and budget were not being approved by the Committee. The Chairperson indicated that he was in discussion on the practical effects of this, as its budget formed part of the DAFF budget, with the Chairperson of the Standing Committee on Appropriations. Members also noted that various reports, including the strategic plans, the annual report and the Forensic report, must be forwarded to the Committee. In the meantime the farms must continue to be run on a month-to-month basis. In regard to the National Agricultural Marketing Council, Members inserted a new recommendation calling for a dedicated team to be set up to concentrate on future market requirements, and the formation of a long-term plan for agricultural products. Two recommendations were included for the Forestry Sector Charter Council. Members noted that although the Perishable Products Export Control Board was not obliged to table its strategic plan to the Committee, the Committee had in fact discussed its work. Members therefore decided to meet on the following day to include a section on this entity also in the Report.

A brief discussion was held on correspondence received in relation to nominations for the Board of Land Bank, of the National Agricultural Marketing Council, and an invitation to a poultry conference.

Meeting report

Chairperson’s opening remarks
The Chairperson said the Committee had been invited to attend what was described as a National Farmers’ Union conference in Johannesburg, but it turned out to be organised by a new body that was intending to establish an African Farmers Association of South Africa. The Committee Members had decided that they could not stay for the conference, as it was in support not of new formations but of one Farmers’ Union for the whole country.

Mr S Abram (ANC) understood that the Department of Agriculture, Forestry and Fisheries (DAFF or the Department) had sponsored some money for that conference, and asked why this was done. He also asked who had hosted the conference and what its agenda was, saying that it was unfortunate that the Committee had not been given full information up front, to avoid wasting time and resources.

Ms M Pilusa-Mosoane (ANC) said that she was not sure of the amount contributed by the Department, but the cost of the conference was apparently R4 million. Both the Department and Minister of Agriculture, Forestry and Fisheries had been at the start of the conference, an announcement had been made that the Minister of Rural Development and Land Reform would attend, but the second presentation had been changed.

Dr L Bosman (DA) elaborated further, saying his concerns were slightly different. He explained that the whole process was initiated by NAFU. At a first conference, held in December, it was decided to restructure and revitalise structures on the ground in the provinces, and then come back in March in order to form a new constituency. The process was followed, and an affiliate of NAFU was tasked with development, which it did from the start until the election of provincial leaders. A delegation was elected for the conference. At the conference, however, it became apparent that there was a clash of interests between the old and the new formations, and when the former management realised it was unlikely to be re-elected to the new structure, it obtained a Court interdict against the use of the “NAFU” name. By this stage the delegates had already been invited and registered, and a decision was taken to proceed with the conference, but only on arrival were the delegates aware that this was no longer NAFU.

Dr Bosman agreed that there should not be factions within the organisation, but that was the current situation. 3 100 people from a number of provinces, who represented farmers on the ground, had attended for the purpose of restructuring NAFU. Farmers were entitled to elect their own representatives. He noted that the DAFF had, as in the past, given finance to what it believed was a NAFU conference. The problem, however, had been that the former leadership was not prepared to restructure into the new organisation.  He did not think that these issues could properly be resolved in the courts.

The Chairperson said that there were two issues. The Department would need to give clarity on the amount of sponsorship, and there was also a need to get a briefing from the department. He emphasised that there was a need for unity between all farmers, existing and emerging farmers, under one union. He thought that the opportunity should be created to discuss how best to assist all farmers in speaking with one voice, in a non-sexist, non-racial and non-partisan way. He also suggested that following the Department’s briefing, a report should be tabled in Parliament.

The Chairperson added that it was only in the evening prior to the conference that it was ordered that the conference could not proceed under the style of NAFU. This would have been the first NAFU conference attended by the Committee since 2009, and would have been a golden opportunity for the Committee to interact with farmers and the various farming organisations.

Mr Abram asked that the Department be sent a letter asking about whether the Department had funded the conference, and under what conditions the funding was granted. He noted that there had been a lot of media coverage, and he found it strange that the organisers did not oppose the granting of the interdict and that the situation was not reported to Parliament.

The Chairperson reiterated that the final interdict order was given only after 7pm, but even at that stage the Committee should have been told that this was not a NAFU conference.

Draft Committee Report on the Department of Agriculture, Forestry and Fisheries Strategic Plan and budget 2011
Dr Bosman noted that some of the Committee Members who were to have attended the NAFU conference had worked on the draft Committee Report. He tabled this report, noting that the issues outlined had been presented by the Department and entities. The observations and recommendations were recorded in paragraph 3.11, but he suggested that the heading be amended to “Committee Recommendations on Programmes 1 – 6”. The rest of the report had already been checked for correctness. He suggested that the Committee should focus on the recommendations.

The Chairperson added that the Committee had also indicated that the paragraphs outlining the background should put the work in context, mentioning the Constitution, the National Treasury regulations, Public Finance Management Act (PFMA) and Money Bills Amendment Procedure and Related Matters Act (the Money Act). The challenges and elaborations on the programme were tabulated by the Department. He reiterated that the major focus should be paragraph 3.11. The final Committee Report would be published in the ATC and would be responded to by the Department.

Mr Abram thanked the Members who had worked over the weekend on the draft Report. He referred to the wording under paragraph 3, and expressed the view that using “must” was more suitable than “should”, in relation to the furnishing of reports and information.

Members agreed to the substitution of this word wherever appropriate.

Members then turned their attention to paragraph 3.11, dealing with the Committee’s recommendations. These were amended, in summary, to read that:

- The Department must outline the role it played with regard to tariffs.
- The Department must be more specific on strategies around agro-processing by smallholders.
- The Department must cooperate with the existing commodity groups rather than reinventing the wheel.
- There must be specific financing models for fisheries.
- There must be a well-coordinated training programme between DAFF and other stakeholders, to better serve the developing farmers.
- DAFF must make available the implementation plan on policy and programme interventions.
- The Department must outline the programme on the interventions, how it would progress per year and which provinces it was targeting.
- The Department must provide its Annual Performance Plan, outlining a plan per province.
- A report must be presented to the Committee on how DAFF restructured its administration and how it had reprioritised its budget.
- A plan on the extension services training must be made available to the Committee.
- The Committee must have access to the Zero Hunger Strategy.
- The Department must outline how it administered the Marine Living Resource Fund in fisheries.
- There must be engagement with the provincial research institutions to promote and achieve coordination of research institution activities.
- A report on the reasons why the Agricultural Research Council (ARC) had been under funded for such a long time must be made available to the Committee.

Mr N du Toit (DA) stressed that the last recommendations should also set time frames for the report.

Ms Pilusa-Mosoane suggested that another recommendation was needed for a report on the agricultural training colleges.

The Chairperson added also that reports were needed on the institutions of higher learning and their research activities.

Mr Abram wondered if there was duplication of research between the ARC and national institutions, and many private sector organisations also did research. The Committee was focusing on State-funded research.

Ms Nokuzola Mgxashe, Committee Researcher, highlighted that there was very little research done between the ARC and the provinces. The issue was that research facilities could be more effectively coordinated between the provinces and National Department.

Members asked Ms Mgxashe to draft the recommendation in this regard, and she was asked also to include the necessary references in regard to institutions of higher learning and the private sector.

Dr Bosman agreed that there was no interaction with research at the ARC. Research in provincial institutions was funded through the provincial budget, and there were no dividends. The under funding of the ARC was also largely due to the fact that a lot of funds were spent on the other institutions. The point was that both the research and the funding should be better coordinated.

Members then turned to the wording of the first two bullet points on page 5. These were amended to read:  

- Create an enabling environment for planting 40 000 hectares of forestry.
- Provide support to 10 000 new small growers. The Department must also say how that was implemented, and must give a quarterly report on how far it had come with the implementation.

The Chairperson said that all recommendations were directed towards achievement of the targets.

Members further agreed that, after the fourth bullet on page 6, a further note would be added that the Department must report to the Committee at the end of May, with recommendations on time frames for each programme’s implementation.

Members then turned to Paragraph 4, dealing with Onderstepoort Biological Products (OBP).

Under paragraph 4.3, the Committee recommendations were to read:

- the OBP needed more funding as a matter of urgency.
- Permanent positions must be filled as a matter of urgency.
- Other departments must be urged to access products from the OBP rather than international companies.
- The DAFF must appoint the OBP board timeously.
- The reasons why the current Chief Executive Officer’s contract was not to be terminated must be made available to the Committee.
- DAFF was required to present a report on how it was enabling farmers to improve animals, and how far it contributed to mitigate against further importation and to achieve self sufficiency.
- There must be focus on areas of mitigating and managing risk and future projections in the agricultural sector throughout the country, to research and advise on increasing production and profitability.
- The information gathered by the Soil Management Division of the ARC must be made available to emerging farmers in a more accessible manner.

It was noted that DAFF must report on these matters by the end of May 2011.

Members turned to paragraph 5, dealing with the Agricultural Research Council.

Under paragraph 5.4, the Committee recommendations read that:

- There must be drastic change in the funding of the ARC.
- There must be a dedicated economic research group to focus on mitigating and managing risk in the agricultural centre.
- The ARC must instigate programmes through DAFF, for the purpose of transfer of information to farmers. In this regard Mr du Toit stressed that it would be necessary to follow world market trends.
 - The ARC was required to report on the animal improvement schemes, including the scheme that was aimed at improving the production potential of the beef cattle belonging to the communal and poorer farmers, and must also report to the Committee on a regular basis on progress made, with examples, and how it would increase meat production over time to achieve less dependency on imports.

Ms Mgxashe advised that the focus would be on those provinces that had the greater potential for livestock.

Members turned to paragraph 6 of the draft Report, dealing with Ncera Farms. The Committee’s recommendations under paragraph 6.2 read that:

- Financial information on NCERA Farms for 2010/11, its strategic plans, and the Forensic Audit Report must be made available to the Committee by 24 May.
- The DAFF must meet with the Provincial Departments and strategise how to take Ncera Farms out of its current crisis
- While the Committee was awaiting reports from DAFF, Ncera Farms must continue its operations on a month-to-month basis.
- It was noted that the Committee was not supporting the budget for NCERA Farms.

The Chairperson noted that the Committee must see the Forensic Investigation Report. He noted that he was discussing the situation around the budget with the Chairperson of the Standing Committee on Appropriations, as there were legal implications around the budget’s operational activities. He reiterated that the Committee had previously resolved that it could not support the strategic plan and budget of Ncera Farms.

Ms Mgxashe asked how the Committee could be supporting the budget of the DAFF, without Ncera Farms.

The Chairperson said there were legal implications to this, and he was discussing what the Committee could do in respect of the time frames, but he agreed that this was a matter of some urgency.

Ms Mgxashe suggested that DAFF be called upon to produce this information by 24 May. She also noted that the financial statements for the year ending March 2011 should be made available.

The Committee noted paragraph 7 of the draft Report, dealing with the National Agricultural Marketing Council (NAMC), and noted that it was not making any recommendations.

Mr du Toit stressed that there should be a division concentrating on economic studies, particularly marketing, to assist the future planning of production on a profitable basis.

Mr Abram suggested asking NAMC whether it had such a division, in which case it should be requested to indicate how it did its work, and whether it concentrated on work with the futures market.

Ms Mgxashe thought NAMC did have such a division, and that it looked at long term trends, focusing on markets, rather than on how to ensure profitability. It would be beneficial for NAMC to work with the ARC on research, including climate change and its likely effects on products.

Mr du Toit stressed that lack of strategy and lack of planning usually arose when there was no integrated unit to attend to this. It would be desirable to have a unit that could coordinate studies done by the universities, agricultural faculties, and private sector, which could then be combined and fed into the ten-year plans, including information on markets and production. The Committee must play a role in achieving greater output and development of farms. He proposed that a recommendation to this effect be inserted, referring to the setting up of a dedicated team to concentrate on future market requirements of various commodities, which could advise what crops should, from time to time, be profitable. He stressed that there was a need for a long-term plan and long-term vision.

Members then turned to paragraph 8, relating to the Forestry Sector Charter Council (FSCC). Members discussed, and then amended the recommendations, to read as follows:

- Another meeting must be convened to focus on the transformation and challenges facing the sector.
- Financial information of the Council must be made available to the Committee within two weeks.

Members noted that no recommendations were necessary under paragraph 9, dealing with the Agricultural Sector Education and Training Authority (AgriSETA). However, some technical amendments were made on the wording.

Members then noted that the Perishable Products Exports Control Board (PPECB) was financially independent, and therefore the Committee had not found it necessary to adopt the strategic plans.

Ms Mgxashe suggested that PPECB should be included in the Committee’s report, as the Committee had commended its work and there were issues raised.

Members agreed that the Committee would meet for a short while during lunch on the following day, to discuss the wording and recommendations for PPECB, and to conclude the draft Committee Report.

Other business
The Chairperson noted that formal correspondence had been received from the Office of the Speaker, in relation to the three vacancies for the board of the Land Bank. It was noted that suggestions and curriculum vitae (CV) for proposed candidates should be forwarded as soon as possible.

Mr Abram asked what role the Committee would play in this process.

The Chairperson responded that the Committee played a role in making recommendations.

Mr Abram asked for a list of the current members, and their CVs, for both the NAMC and Land Bank.

The Chairperson said that the Committee had been informed, by DAFF and the Minister, that there were ten vacancies on the NAMC Council. Five of the positions must be filled by nominees from the agricultural industry. Three were eligible for reappointment. The Committee made recommendations, but the Minister made the final appointments.

Mr Abram asked that at some point the Committee might like to consider land reform issues, He also noted that although the Department of Correctional Services ran a number of farms, it had no formal liaison with DAFF.

Ms Mgxashe announced that on Monday 18 April the Institute for Security Studies in Woodstock would be running a public seminar. She would email the information to Members.

Mr Abram noted that he had received an invitation from the South African Poultry Association to a major conference from 31 May to 2 June. He noted that he would be attending.

The meeting was adjourned.


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