The Committee was briefed by the Committee researchers before the Department of Agriculture, Forestry and Fisheries presented their third and fourth quarter performance reports for 2013/14. Minister Zokwana presented the report, covering achievements and so-called non-achievements. Some of the achievements were the positive trade balance, successive unqualified audit opinions, and regulatory measures applied to identify Citrus Black Spot (CBS) orchards to ensure continued exports of citrus to the EU.
Some of the non-achievements related to a weakness in monitoring results, the lack of success in the conservation project of a number of indigenous agricultural genetic resources. Out of a total of 130 000 subsistence producers only 36 678 were supported. Evidence from provinces for performance was inconsistent. National Department also failed in verifying the evidence against the information provided. The Department had made little progress in implementing the Comprehensive African Agricultural Development Programme (CAADP) and the implementation of the Charter undertakings in Forestry Development and regulations. The allocation of fishing rights needed urgent attention and finalisation.
The Department operates six programmes:
Programme 1- Administration
Programme 2 – Agricultural Production, Health and Food Safety
Programme 3 – Food Security and Agrarian reform
Programme 4: Economic Development, Trade and Marketing
Programme 5 : Forestry and Natural Resources Management
Programme 6: Fisheries Management
Members raised concerns about the state of educational institutions, the high expenditure versus low target achievement in certain programmes, the abalone rights that were about to expire at the end of July, lack of clarity in the report on matters such as support and regional distribution of such support. Concern was raised around the vulnerability of marine resources and slow progress in revamping of irrigation schemes. The Department acknowledged these concerns, inviting further enquiries and assuring ongoing endeavours to make improvements where necessary.
The committee researcher said that sixteen out of 53 indicators had been achieved in the third quarter and nineteen out of 53 in the fourth. This translated into 30% and 33% respectively, while the entire budget for these two quarters had been spent, even though the intended objectives had not been met. Nothing had been reported on the 24 Acts that should have been processed. Programme 5 does not stipulate where the 200 000 hectares that have been rehabilitated are located, so one cannot assess whether provincial targets were achieved. While performance was low, budget expenditure was virtually 100% at 98%. This was a standing issue, reoccurring in previous years that pre-determined objectives could not be met. In Programme 2 spending stood at 82%, which should have been closer to 75%, in the form of transferred funds to provinces and agencies and accounts. According to expenditure of National Treasury only 70% was transferred to provinces and agencies. There was a discrepancy. In Programme 5 only 55% of the budget had been spent by the third quarter. While this programme had been previously underfunded, it seemed the Department still struggled to spend the budget here, which was apparently due to capacity problems. Funds had been transferred between programmes from programmes 2,4 and 5 to programmes 1, 3 and 6 to the amount of R42,9 million. Much had moved from service delivery to administration. This was worrying. Usually performance picked up during the year, but in this case, percentages had dropped in the third and fourth quarters. While the Pig Improvement Scheme was a success, the scheme seemed to have been cancelled. In Programme 3 the target support for subsistence farmers had been achieved but not that for small scale farmers. Out of 90 000 only 3000 could be verified. What did this support consist of and since no detail was provided it could even lead to double counting, whereby the same farmers could be receiving different kinds of support. These figures all needed clarifying. The task of job creation in line with the National Growth Path was not achieved. Lack of funding was given as a reason for this. What had happened to the funds retracted by National Treasury? The slow progress in the implementation of the agro-processing strategy was a concern.
Another researcher, Mr Joseph Ginindza, spoke on fisheries. He said the stated achievements were not a reflection of targets set. For example, the review of the Marine Living Resources Amendment Bill was actually completed in the first quarter of 2014. Out of 8 targets for Fisheries, only two had been achieved by the third quarter. Yet this was considered to constitute 92% of the annual target which simply did not compute. Fishing rights had been nullified by the previous Minister and needed to be revised. The Department had done well in its support to farmers regarding aquaculture. Abalone poaching remained a challenge and the Department needed to brief the Committee, possibly in a closed meeting, on how it was going to combat organised crime.
Committee researcher briefing
Mr L Ntshayisa (AIC) asked why if there was an unemployment problem in the country, was capacity an issue and if only 70% of funds had been transferred to the provinces, what had happened to the rest of the funds?
Ms A Steyn (DA) queried the positive trade balance, which was indicated as having increased from R3,1 billion in 2012 to R15,1 billion in 2013, which although seeming to be a great improvement, did not detail the breakdown between imports and exports. It was her understanding that imports had increased more than exports. She wanted to know what these figures constituted.
Ms Z Jongbloed (DA) wanted to know what the latest situation was regarding abalone rights which were set to expire at the end of July.
Mr T Ramokhoase (ANC) asked how the department would be responding to the Auditor-General’s findings.
Mr Maxhegwana (ANC) referred to slide 6 of the presentation which list achievements and asked for a breakdown of the number of mobile animal clinics according to province.
The researcher replied that according to the PFMA, overspending had occurred on Programme 2 and that targets and spending should be spread roughly equally over the four and therefore there should be about 25% spending occurring in the first quarter and by the third quarter, spending should stand at around 75% accumulatively. This spending should go hand in hand with achieved deliverables. There was an anomaly between what had been spent on Programme 2 and the non achievement of deliverables. Programme 5 had been previously underfunded and yet when it had been allocated additional funding, only 55% of the budget had been spent by the third quarter and targets had not been achieved. The categorization of agricultural produce versus food products was not clear in the department document. It was not clear whether South Africa was still a net importer of food products. Food security was a major concern as also highlighted by National Treasury. Relying on food imports should be avoided if possible, for example maize produce should be processed in South Africa as well. It seemed that concerns raised by the Auditor-General persisted and no visible plans were in place to address them. A concern about compulsory community service by para-vet and veterinary students through the mobile clinics, was that these students should be adequately equipped to do their work.
Minister Senzeni Zokwana took the Committee through the performance expenditure reports and at various points where underachievement was indicated, the Minister acknowledged room for improvement.
He said the Citrus Black Spot (CBS) issue was being dealt with in conjunction with the Ministry of Science and Technology. Regarding fresh ostrich meat, other markets continued to buy from South Africa. Problems around infrastructure and curriculum at certain colleges was being addressed and R65 million had been made available to address them. While the Knowledge and Information Management (KIM) Strategy had not been implemented, fast tracking of change management plan was underway. Due to the elections, the legislation review had been delayed. The Agro-processing Strategy not implemented due to poor leadership in the Branch. The drought had affected their ability to provide support to small growers in KZN.
Professor Edith Vries, DAFF Director General, spoke to annual targets and milestones achieved in the third and fourth quarters. There were some instances where there were several milestones for each target. In Annexure E of the Annual Report, more detail was provided on support given to small scale farmers. She noted there was a weakness in the system of performance monitoring. In total, 69% of the milestones had been achieved by the end of the third quarter and 84% by the end of the fourth. The Auditor General had given an unqualified opinion on financial information. This required at least 80% achievement. It had assessed three of the programmes; 2, 3 and 5. Programme 2 moved from a qualification to an unqualified opinion. Food Security and Agrarian Reform remained qualified. Forestry Management moved from a disclaimer to a qualification.
The CFO of the Department summarized the expenditure of the Department:
Out of a budget of R6,1 billion, expenditure during the third quarter was slightly above the 25% at 26, 9%, and while being at 25% for the fourth quarter. R3,98 million was spent during the third quarter on employees salaries and R3,81 million in the fourth quarter. Transfers and subsidies totalled R1, 017 billion during the third quarter and R801 million during the fourth quarter. Reasons for over spending or under-spending were provided.
Areas of concern raised by the Auditor General and action taken by DAFF were listed:
▪ Performance Monitoring has improved. However, the impact of these measures will only be evident at the end of 2014/15.
▪ Problems in Risk Management and Internal Audit were raised as matters of concern. However, it has been corrected and will not present as a repeat finding.
▪ Irregular expenditure was identified but disciplinary action was instituted.
▪ Inadequate monitoring of conditional grants such as CASP. Evaluation had been done by the Department of Performance Monitoring and Evaluation.
A Draft Report on this and the plan for corrective action was still being finalised.
Ms Steyn (DA) thanked the delegates for the presentation and commented that in general throughout the presentation, one could not get a sense of what percentage of the target had been achieved and what original targets had been set. For example where it mentioned the number of hectares rehabilitated, there was no indication what percentage of the total area this rehabilitation constituted, in order to get a sense of what had really been achieved and what still needed to be done. She felt that while some activities had been categorized as achievements in the presentation, she was hard put to consider them as achievements, since they made very little impact on the sector as a whole. She would be submitting written questions in this regard. She asked for more detail on what imports and exports consisted of in order to get a more realistic perspective on the positive trade balance figures. Similarly, when it came to the Animal Production and Health Programme, there was no detail on what was being measured as a target. She wanted to know whether the Pig improvement scheme had been cancelled. Regarding Inspection and Quarantine Services, comments did not indicate whether targets had been achieved, merely that regular inspections had been conducted. She asked for assurance around capacity to deal with the regulations from the EU in controlling the Citrus Black Spot disease. She asked if the upgrades which had been due for Potchefstroom College had been completed since the institution had fallen into a state of disrepair. Had the funding which had been taken back by National Treasury for the Agri BEE fund, been returned yet? The amount in question was around R230 million. Where were the negotiations with Landbank in this regard? The report on 15 cooperatives being supported did not instil any confidence, since this was a paltry number in the context of a country like South Africa. Also no further details on how much had been spent and how these cooperatives had been supported, had been provided.
Mr Z Mandela (ANC) said he had yet to see the Department’s involvement in delivering towards the food security of rural communities in line with the comprehensive rural development programme. In his home community some 352 ha had been fenced by the Department of Rural Development but various challenges still remained, such as irrigation and stock such as cattle, goats and donkeys. There seemed to be some Chinese involvement, since they were interested in donkey products. How was the Department getting involved in partnership with the Department of Rural Development? He asked why the Department seemed to be focusing only on the EU in exporting citrus. What about the BRICS countries? What was the Department doing about changing traditional ways for keeping and selling stock? What was the Department doing about encouraging primary and high school learners to become more interested in working in the agricultural sector? Is land being made available for this purpose and are household gardens being actively promoted? He asked how it was possible that 0 hectares had been revitalized at Makhathini. Under the Food Security Programme, he wanted to know where the subsistence producers were located that had been supported and how these had been selected.
Mr T Ramokhoase (ANC) commented that relevant information was needed in order to acquit the task of oversight properly. Also he wanted to know which issues, if any, had been raised when the Auditor General issued his unqualified audit report. How would these issues be addressed?
Ms Steyn said that the report had not covered all work done by the Department and that she would like to raise the question of problems that had been reported to her around Act 17 on subdivisions and Act 36 regarding registrations. Major backlogs had been reported in these areas. The previous minister had even been taken to court over some of these issues. The Minister could decide if he wanted to answer these questions.
Ms Semenya agreed that it was the right of parliament to include such matters but that this should be done in good time, and not squeeze it in without proper notice.
Mr B Joseph (EFF) said targets were not clear in the report. The previous year’s Annual Performance Plan (APP) was difficult to get hold of and evidence should be produced to warrant an expenditure of 98,9%. If the vacancy rate was 9,5% , which was considered average, how could it be that budget expenditure reached 98,9%. There was a discrepancy, since according to these number approximately 90,5% of the budget should have been spent.
Ms Semenya asked for comment on how the Department reconciled the dilemma of not having filled all posts and at the same time was struggling to find funds for service delivery?
Prof Vries, Director General for the Department, agreed that not all the work of the Department was reflected in the reports and that only what was considered strategic matters had been included based on the MTSF targets and issues raised by the Auditor General. On the unqualified report by the latter, there had been no matters of emphasis, merely concerns raised as listed in the report and an audit action plan had been drafted to tackle them. In order to ensure that these issues would not come up again, it had been resolved to reduce these issues by 60% before the next year’s audit. The evidence requested on what was being measured in targets and how these were being monitored, was detailed in Annexure E of the annual report. The vacancy rate was partly due to the length of time it took to have applicants qualifications checked through SAQA and to obtain their security clearance, which took 5.8 months. Once a position was vacated, it was not simply a matter of filling it again, as the nature and demands of the position were constantly changing.
Prof Vries confirmed that the funding retracted by National Treasury for the Agri BEE fund had not yet been returned. A meeting with the CEO of Landbank, together with the Directors General of National Treasury and Rural Development. The Department was guided by the National Development Plan, the Comprehensive African Agricultural Development Programme (CAADP) in the same way as the Department for Rural Development, as well as by the Mozambique Declaration, which stipulated 10% of public expenditure should be on agriculture. In many ways the mandates for both Departments overlapped, causing both to fight over the same funds for essentially the same purposes. There was confusion around each Department’s mandate with the Department of Rural Development increasingly getting involved in agriculture. It was important to foster collaboration between the Directors General as seven out of nine HODs report to both.
The Minister said the Department was committed to facilitating oversight by the Committee and welcomed any written enquiries. On the questions raised by Mr Ramokhoase, he agreed that actions taken to address concerns raised by the AG would have to be monitored and time frames set for their resolution. On the question on service delivery versus posts being filled, he said that performance would have to be better monitored and analysed going forward.
General Bheki Cele, Deputy Minister, said that service delivery was always a moving target and that filling posts affected service delivery. Finding people with the right qualifications remained a challenge, but should not lead to compromises just for the sake of filling a position.
Mr Moketsa Ramasodi, (Acting) DDG: Agricultural Production, Health & Food Safety, confirmed that targets had been achieved in the Inspection and Quarantine Services Programme and regular inspections being conducted. The focus had been shifted from the National Pigs survey to avian influenza surveillance. Additional manpower for the monitoring of Citrus Black Spot had been arranged through reprioritizing and also capacity for research in this area was available. Diversification of the citrus market was on the cards and did involve certain BRICS countries as 40% of citrus was being exported to the EU. A service delivery plan was in place to fill vacancies.
The Minister said that meetings with citrus growers along with the Department of Science and Technology were taking place to manage the demands made by the EU regarding Citrus Black Spot (CBS) disease, although some of these were not so much about South African deficiencies but rather about protecting European farming interests. He was sure that these challenges would be overcome. Kaonafatso ya Dikgomo needed more work and implementation in the rural areas. Issues such as where to sell one’s cattle optimally needed to be addressed by municipalities and traditional leaders with buy-in from all stakeholders.
Ms Semenya said there was little evidence of Kaonafatso ya Dikgomo in some provinces and support was not consistent.
Mr Ramasodi said the deliverables for the interbreeding programme had not been achieved and interbreeding between the Namaqua goat and the Afrikaner cattle had not succeeded. This was due to late procurement.
Mr Maxhegwana asked for an audit of the Tsolo and Potchefstroom Colleges. He asked what would happen to the balance of the 1 988 students who had been trained but not placed in positions, which were 599.
Ms Steyn asked for more context on the information on the revitalization of the Vaal irrigation schemes. It was meaningless without understanding how long the entire project would take to complete and also in determining whether this was really realistic and acceptable.
Mr Mokutule Kgobokoe, Deputy Director General: Food Security and Agrarian Reform (FSAR), said that Potschefstroom College had been upgraded since some R4,5 million had been transferred from National Treasury and had been accredited by the Council on Higher Education. There was a career awareness programme run by the Department as well as a Agricultural Bursay Scheme to attract youth into the sector, although more needed to be done. This in turn would require more resources. Currently they had a system where primary school learners were identified and captured in high school up to matric. Typically these matric learners would have both maths and science as subjects. They could then qualify for bursaries. On the Makhatini question, this must be a mistake since work had been done on this project although not necessarily completed. Support was based on recommendation from district committees and in turn recommended by provincial committees. Information on these selections could be provided to the Committee. The suggestion to audit both Tsolo and Potchefstroom Colleges was noted. The Fetsa Tlala initiative for 2013/14 was to place 200 000 ha under production, of which about 149 000 ha was achieved. The shortfall was due to budget constraints.
The Minister admitted that the colleges should be audited. A food production meeting with the MECs had emphasized the need for a seamless model running though national to local levels. New technology needed to be brought in and unused land needed to be harnessed. Diversification of crops was vital as many farmers sill focused on one crop. Processing such crops was also important.
Deputy Minister Cele said that in promoting agriculture in education, the practical aspect of this skill needed to be incorporated rather than just theory as seemed to be the case at certain schools where learners could take the subject to matric level. Tighter control needed to be maintained on the grant system, which at a cost of some R2 billion was substantial and the Department needed to see results from this investment.
Ms Semenya acknowledged the improvements that had been facilitated by the Minister and his Deputy, but that transformation was still required at certain educational institutions. The Fetsa Tlala initiative needed to be explained to the Committee as there seemed to be some inequalities in the implementation of the scheme. Some farmers seemed to be long term recipients of the scheme, while some complained that the costs had outweighed the benefits. Eskom also needed to be engaged in this project.
The Minister said further analysis was needed on these allocations made in the past and province needed to account for them. Operation Phakisa was part of this process of accountability. He agreed that where the Department funded educational institutions, it should have the right to require transformation. Youth needed to be enticed into this lucrative sector and alternative energy sources should also be harnessed.
Ms Jongbloed asked for more information to be supplied to the Committee on the AgriBEE Fund since most of the committee members were new.
Mr Ramokhoase said that that the Department had twelve months to determine the success or failure of a project and that measures needed to be put in place during that period to ensure a turn around. Simply giving “slow progress” as a reason was unacceptable. This referred particularly to the CAADP.
Mr Mandela said there was little support for indigenous communities in the forestry sector. The Department should empower rather than provide handouts. He questioned the Department’s ability to increase irrigation schemes when they seemed to be struggling to maintain those already in existence. He referred in particular to the Mvezo and Ncamata Basin Schemes. He questioned whether South Africa had the capacity to police its coastal waters as large parts of it were being occupied by foreign ships who were obviously poaching. Surely local communities should be supported to be able to start benefiting from maritime resources, rather than foreigners. How was this being facilitated?
Ms Steyn pointed out that our farmers needed more support and protection. The report had clustered information on forestry which needed clarification. Land claims from forestry had not been transferred to communities yet.
Ms Jongbloed said rights for abalone expired on 31 July. What was the Department doing about it? Was the Fishing Rights Allocation Process (FRAP) being revised? She asked whether the Afrikaner was still under repair.
Ms Semenya questioned whether it was still worth repairing the Afrikaner, which was very old.
The Minister confirmed that this one vessel was still in repair. Cracks had been found round the engine. The sea shore needed to be made more secure. Various projects, even ship building projects had been considered in this context in the third workstream of Operation Phakisa in conjunction with other departments. We needed to retain the use of our resources. Abalone rights could not simply be banned or one would encourage poaching. Law advisors were working on this question currently. FRAP would transform the fishing industry since it was not acceptable for a few companies to be in a position to exploit our resources.
Deputy Minister Cele said the decision around abalone rights was in process. The population needed to be socialized around seafood consumption as a whole as many blacks did not consider it a viable food source yet. This perception was changing slowly.
The Minister said that all communities living around forests should benefit and they were engaging various local authorities in this regard. They would also be visiting kings in the Eastern Cape to discuss the protection and harvesting of maritime resources. The land claimed in KZN in the Nquthu local authority will be transferred.
Mr Mortimer Mannya, DDG: Fisheries, said that the decline in fish socks was indicated by the decrease in 1991 from 615 tonnes to 46 tonnes in 1996. Abalone was a high value species and therefore a transformation programme was urgently needed to curb temptation to poach.
Ms Semenya thanked the Minister and delegation.
Looking at the draft programme, Ms Semenya suggested the Committee take five days in September to do oversight.
Ms Steyn agreed but suggested the committee decide on the itinerary, to ensure these trips were better planned and more effective.
Mr Maxhegwana suggested an advance party ensure a more productive outcome.
Ms Semenya agreed that research needed to be done in this regard and that the visits cover all aspects equally, agriculture, forestry and fisheries.
The Committee adopted minutes of a previous meeting.
The meeting was adjourned.