Potato S.A. on Levy Application, The Land Claims Commissioner: briefing

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Meeting report

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The aim of this report is to summarise the main events at the meeting and identify the key role players. This report is not a verbatim transcript of proceedings.

04 June 2002

Chairperson: Mr N.H. Masithela

Documents handed out:
Submission of the Commission on Restitution of Land Rights on their annual programme

The Potato Council came to present their side of the story to the Committee. The two remaining executive members of the Council believed that they could do something to redeem the image of Potato SA by removing the old top management of the Council. However, the Committee was unwilling to change their decision of refusing the application of the levy, until forensic audit had been conducted on the mismanagement of funds. The Minister would then appoint a new board of trustees to administer the levy. The application could be approved when a new trust was appointed.

The Chief Land Claims Commissioner reported the progress of the Commission in all the provinces for the financial year April 2001 to March 2002. The Committee approved the report and commended the Commission on the good work they were doing.

The Chairperson said the Committee wanted to hear Potato Council's side of the story. He said they met with Potato SA and told them of the Committee's decision. He said the report of the Council would determine whether the decision of the Committee could be changed.

Comments from the Potato Council

Dr D.J. Theron, Chairperson of the Potato Council, reported that they had fired the old top management of the Council and felt that things could be back to normal. The problem was that the person who led Potato SA before was a "dictator" and did things his own way. They said that now that the management has been changed, Potato SA was structured in a proper manner and the organization was business oriented. According to the Council, Potato SA was ready to operate and do business in the potato industry. They noted that the potato industry in South Africa was the leading potato industry in all of Africa.

The Potato Council assured the Committee that they were committed to President Mbeki's strategic plan for agriculture. They said they were prepared to take any recommendations that the Committee came with. Recently, there was a referendum in the potato industry, and people voted for a producer organization and an application for statutory levy. In fact, 85% voted for a producer organization and 76% for the levy application. A Congress of Potato SA also agreed that the structure of Potato SA needed to be changed.


Mr R. Schoeman (ANC) said it was good for Potato SA to have come and present their side of the story to the Committee. He said there was no hurry to approve the application because the envisaged trust had not yet been established. He asked who would administer the levy, if the application were approved. If the Committee decided to give the Council a go ahead with the administration of the levy, would there be assurance that mismanagement would not happen again?

Mr Z. Otwal (ANC) asked what happened to the 'dictator' who led Potato SA to that misery?

Dr Theron said they trusted him (the dictator), and he always presented them with incorrect information that was based on wrong assumptions. For instance, he misled them to lose R12million in two years, R6million in each year. The "dictator" was eventually fired.

Mr A Van Niekerk (FA) asked if there were new people in the top management of the Council, because he feared a situation where the same people would be given authority to administer the Trust. He asked what had been done to put new people on the Potato Council.

Dr Theron replied that Potato SA was not interested in managing the Trust. He said out of the 265 people that were employed by Potato SA, 187 were fired, and this included those who were in top management, amongst them the General Manager. The national executive was also changed. He said he and Mr F. Lawrence, who accompanied him in the meeting, were instrumental in implementing those changes in management.

Mr S. Bhengu (IFP) said he did not believe that it was only one person who was guilty of mismanagement in the Council, there were a lot of them. Nevertheless, the Minister should be allowed to form a trust, and the issue of levy would be revisited thereafter.

Mr D. Maluleke (DP) noted that the potato industry was labour-intensive, and wondered given the retrenchments that have taken place, what steps were being taken to ensure that it remained labour-intensive.

In responding to that question, Dr Theron said potato specialists were very few in the country and that something needed to be done to recruit more people in the industry. There was no firing of people from the lower levels of employment. The people who were fired were in the middle and top management.

Ms B. Ntuli (ANC) asked how the R22million was used.

Dr Theron said there was mismanagement of funds, and they would not run away from the fact that criminal prosecution could be conducted if there was a need.

An ANC member said that the two gentlemen, Dr Theron and Mr Lawrence, were also part of the old Council. They might have been involved in the mismanagement of funds that took place in the Potato Council. He wanted to know how the Committee could trust them.

Mr M. Maphalala (ANC) said the decision of the Committee concerning finances of the Council has already been taken in the previous meeting. He felt that the Committee should not continue asking the two gentlemen questions on issues that have been dealt with already in the previous meeting.

Mr P. Ditshetelo (ACDP) asked whether there was something going on in Potato SA, so that the Committee could make recommendations based on that.

In responding to that question, Dr Theron said they have tried to make a lot of changes in the management of Potato SA. He pleaded to the Committee that the organization should be given a chance. He asked the Committee to consider the future of the industry and approve the application of the levy.

Mr D. Hanekom (ANC) proposed that the Committee should stick to their decision that the levy would only be approved when a credible Trust had been established. Otherwise the Committee had no justification to reverse the decision.

Mr Schoeman seconded the proposal saying that such a decision would be better to ensure that the levy was used for its intended purpose.

Mr S. Farrow (ANC) suggested that there should be a separation of powers between the Council of Potato SA and the Trust.

Adv. P. Holomisa (ANC) added that the R22million should be investigated and a forensic audit be taken to ensure that somebody was held responsible for the money that was lost. That should not be left on the Council.

The Committee Clerk read the Committee's report that disapproved the application of the levy. The report was adopted by the Committee.

Land Claims Commission

The Chief Land Claims Commissioner, Adv. Wallace Mgoqi, reported that a number of claims had been settled in different areas of South Africa. He said 2002 had witnessed heightened activity in the settlement of claims by the Commission. Between April and May, there had been a handover of land nearly every weekend in all the provinces.


Mr L. Dlali (ANC) commented that people in the Eastern Cape received land for agricultural purposes but the areas were immediately occupied with shacks. He wanted to know what mechanisms there were to ensure that the land that was acquired was used for the intended objectives.

An Eastern Cape Regional Land Claims Commissioner, Mr Tozi Gwanya, said unfortunately that was not their mandate as a Commission to make after-settlement arrangements. He said their budget was limited only to administer the claims and hand over the land to the claimants. Even the Act under which they operated did not cover the period after settlement. However, they felt that something needed to be done, hence they signed an agreement with the Land Bank to assist those who had acquired land on how to make their land productive.

He added that the process of restitution was a very expensive one. The National Treasury could not believe the Commission's figures that stated for each year the Commission would need more than R1billion to administer the claims.

Mr Farrow further asked what the policy was on validation. He wanted to know what would happen if a case was not validated.

Adv. Mgoqi said there was a reprieve if a case was not validated. For instance, an outside lawyer could be asked to make a legal opinion. If again the case could not be validated, the community would be given a reprieve, either to purchase the land or to lease it and use it for agricultural purposes

Mr Bhengu argued that constituencies were always kept in the dark. Parliamentarians were not informed of the restitution ceremonies that were taking place in the communities. He asked the Chief Land Claims Commissioner to keep Parliamentarians informed of what was taking place.

Adv. Mgoqi assured the Committee that they would invite them in all the handing over ceremonies that were going to be held in all the provinces in the future.

Mr S. Abram (UDM) asked how the Commission helped people after they had been given the land.

Adv. Mgoqi replied that they were bringing in the Land Bank to assist people with loans and information on how to work the land.

Mr Van Niekerk asked what the problem was in the land claims commission at local level, because it seemed that there was a problem.

Adv Mgoqi said they wanted to bring in local authorities so that when the land was given they should know within their budget what they could do with that land.

Mr P. Nefolovhodwe wanted to know why consultants without knowledge of land issues were hired in certain areas. For instance, in the Northern Province people were given land that had minerals, but the people were not allowed to exploit those minerals. What should be done in such cases?

Adv. Mgoqi said those were very complex issues, because according to them mining rights and land rights were two different things. People should apply for mining rights if the land that they were given had minerals. It would be a different case if the mine was owned by somebody else, then the government could look at other mechanisms.

Ms Ntuli asked how involved other departments were when people were given back their land. She believed that if other departments were involved it would help people in terms of sharing information on what to do with the land that they were given.

Mr Gwanya, the Eastern Cape Commissioner, pointed out that there was too much pressure on the Land Claims Commissioners, and it was not possible for them to call other departments. He said that was an area that needed extra effort and expertise, in fact he said that was supposed to be done by a different structure altogether. As they indicated earlier, the Commission was not responsible for post settlement arrangements.

Mr Dlali asked the Commissioner to give substantive reasons why other regional Commissioners were not present in the meeting.

Adv. Mgoqi said the reasons that were given by most of the Commissioners were not valid; there was only one Commissioner who reported that he had flu. He said he would take the matter to the Minister.

In conclusion the Commission was commended on the good work that they were doing.

The meeting was adjourned.

Should you wish to submit any comments regarding the content of this meeting to the members of the parliamentary committee, kindly email them to tasco@contacttrust.org.za and we will ensure that they are hand delivered to the members.

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