Department of Agriculture progress report on alignment of services between DAFF, its Entities & Provinces; Response to SONA & 2014 BRRR

Meeting report

The Chairperson apologised to everyone present for her late arrival to the meeting. She welcomed the delegation from the Department of Agriculture, Forestry and Fisheries, which was headed by the Director General.

Apologies were received from Mr Senzeni Zokwana, Minister of Agriculture, Forestry and Fisheries; General Bheki Cele, the Deputy Minister of Agriculture, Forestry and Fisheries, and Mr L Ntshayisa (AIC).

The Chairperson requested that the DG commence with the presentation of the Department’s response on the State of the Nation Address after introducing any new member in the delegation.

Response by the Department of Agriculture, Forestry and Fisheries (DAFF) on the State of the Nation Address
Prof Edith Vries, Director-General, DAFF,  explained that the Department’s response was based on the theme of the State of the Nation Address (SONA) which was “Growing the Economy” and as it was captured in the President’s statement that “The year 2015 is the Year of the Freedom Charter and Unity in Action to Advance Economic Freedom”.  The current contribution of agriculture to economic growth and job creation was far below the potential of the sector. It was therefore no surprise that the President identified Agriculture as “a catalyst for growth and food security” and announced the revitalising of agriculture and the agro-processing value chain as one of the nine point plan to ignite growth and create jobs.

Her first area of focus was on job creation in the sector. The decision to isolate Agriculture as a growth sector was because Agriculture delivers more jobs per Rand invested than any other productive sector, and also remained critical in the face of rural poverty and food insecurity. The National Development Plan (NDP) estimated that Agriculture could potentially create 1 million jobs by 2030. However, the conditions for meeting this target included a focus on high growth commodities, in combination with improved delivery on land reforms and improved livelihoods within communal areas. DAFF was determined that in the near future the South African people would begin to derive the benefits of its direct interventions to encourage investment in the Agriculture and Agro-processing value chain. Progress was already being made in this regard. The latest STATSSA Quarterly Labour Force Survey confirmed that Agriculture contributed the greatest number of employees at 56 000 quarter on quarter and sustained increases in job creation year on year of 28 000. DAFF is confident that this number would grow as it institutionalises the Agricultural Policy Action Plan (APAP) and significantly increases the production of strategic commodities by smallholder producers. DAFF also has a number of initiatives to bring new entrants into the sector. For example, DAFF’s bursary scheme which was introduced in 2003 has produced over 1 000 graduates. None of the recipients of DAFF’s bursaries are unemployed as they were either brought into the Department for an internship or deployed to DAFF’s entities or into commodity groups. The bursary scheme also targets Grade 11 and 12 learners at rural schools and in the Western Cape. DAFF would be funding 65 learners this year, 20 of which are at two Senior Secondary schools in De Doorns. In the 2015/16 financial year, DAFF would develop and implement a strategy to identify and deploy graduates from agriculture colleges to APAP and land reforms farms and projects.

Her second area of focus was on the Agricultural Policy Action Plan (APAP). At the SONA, the President stated that the government was working with the private sector to develop an APAP that would bring one million hectares of under-utilised land into full production over the next three years. Ms Vries was pleased to inform the Committee that the APAP had been recommended to Cabinet for approval by the Economic Sector, Employment and Infrastructure Development Cabinet Committee two days prior to the Committee meeting. The APAP is a set of detailed actions with timeframes, which would revitalise the Agriculture and Agro-processing value-chain. The APAP sought to translate the high-level responses offered in the Agriculture, Forestry and Fisheries Strategic Framework into tangible, concrete steps and actions. However, this first iteration of APAP would not be offered as a fully comprehensive plan but on the model of the Industrial Policy Action Plan (‘IPAP’), as it identified an ambitious but manageable number of focused actions in anticipation of future APAP iterations. The Agriculture, Forestry and Fisheries Strategic Framework spell out a vision for more equitable, productive, competitive and sustainable growth. In doing so it outlines key policy areas or policy pillars, including Equity and transformation, equitable growth and competitiveness, environmental sustainability and good governance.

To implement the Agriculture, Forestry and Fisheries Strategic Framework, APAP outlined a value chain approach in which it identified priority commodities. The selection criteria of commodities, as identified in the National Development Plan, included those with high growth potential, and high labour absorption like fruits and more specifically citrus. DAFF further added some other commodities with the potential to contribute to a positive trade balance. These are Red Meat, Poultry, Fruit and Vegetables, Sugar, Wine, Wheat, Forestry, Fisheries and Aquaculture and Bio-fuels. She added that there was likely to be a public debate on the selection of these commodities as each industry had canvassed for the inclusion of their commodity in the APAP. It must however be noted that the identified commodities were consulted on through an inclusive process with Commodity Organizations, State Owned Enterprises, Provincial Departments, and Other National Departments. Also included in the APAP were transversal Key Action Programmes addressing cross-cutting matter including: Fetsa Tlala – our production response; Climate Smart Agriculture which was proposed as an alternative to capital intensive modes of production; Trade, Agri-Business Development and Support, Bio-security, SIP11, and Research and Innovation.

Each of the Key Action Programmes in the APAP defined: the Problem Statement in the context of achieving more inclusive growth, and growth constraints that must be; Aspirations, which defines set targets to meet objectives; Required Policy Levers, and Key Outputs in achieving the set aspirations. For example one of the problem statements on poultry included: Consumption of white meat is expected to expand by 34%. This increase was supplemented through high levels of imports especially low-cost frozen portions. Other problem statements on poultry could be sighted in the presentation.

DAFF is therefore enabled to formulate a preliminary impact statement with a view that with all conditions favourable, APAP could by 2019 potentially: Increase in number of smallholder producers from 164 000 in 2012 to 400 500, Increase value added of Agriculture, Forestry and Fisheries (AFF) from R42,5 billion in 2012 to R48,9 billion in 2019 – a 2% real growth per year, real increase in value of Agriculture, Forestry and Fisheries net exports from an annual average of R5,1 billion in 2012 to R5,8 billion in 2019 – a 2% real growth per year, decrease in value of diesel, fertiliser and machinery imports at an annual average of R9,6 billion in 2012 to R7,4 billion - a 3% real decline per year, reduction in the share of households experiencing hunger from 10,8% of households in 2012 to 8,0% of households in 2019 and an increase in number of jobs in Agriculture, Forestry and Fisheries from 660 000 average for 2012 to 822 500 which is an additional 162 500 jobs and a potential 1 million jobs by 2030.

The Inclusion of smallholder farmers in the Agricultural Economy was the third point that the DG highlighted. Prof Vries informed the Committee that the measurement of numbers and tracking of the performance of the number of smallholder producers would be improved over the next two years. At present smallholders were statistically unknown and there was no uniformity in the definitions and categorisation of different categories of farmers. This Comprehensive Framework on Producer Support was therefore an important project that DAFF proposes to complete by the middle of 2015/16. Through APAP, DAFF aims to bring more smallholders into the mainstream as envisaged in the National Development Plan, however, the effective participation of the previously excluded black majority in agriculture and food production would only occur meaningfully, when they have access to land and the means to work it. An inclusive and scientific process would be used to assess the situation in terms of land capability for different commodities and in different localities, so as to inform land acquisition and allocation for different categories of producers across the country.

In Vhembe District Municipality in Musina for example, Limpopo Government has supported the Nwanedi Cluster comprising 300 farmers growing vegetables on just over 1,300 hectares for commercial purposes. The Cluster had already created more than 2,500 jobs as vegetable farming is highly labour-intensive. This project would be intensified and an additional 1,200 hectares would increase land under production over the MTEF period. The expansion of the project would include the establishment of a Logistics and Agro-processing hub that would allow these farmers to add further value to their crops. DAFF, through the Province, would invest R100m over the MTEF period to leverage growth of the private sector in this Cluster. In the 2015/16 financial year, DAFF would directly invest R20m for bulk-water supply and in-field irrigation. Such initiatives going forward would become a reality in the 27 priority district municipalities such as Alfred Nzo and Sekhukhune. Lives would be changed for the better as market access for smallholder farmers, leverage private-sector investment in Agro-processing and provide technical support to smallholder farmers is created.

The DG also touched on the contribution of Agriculture to the GDP. The President reported that Agro-processing exports had been growing rapidly especially to new markets in Africa and China. For example after 5-years of technical work on the resolving the phyto-sanitary requirements, agricultural trade protocols for the export of South African Maize and Apples to China was concluded. Export of apples alone has been projected to generate R500 million in foreign exchange and thus the industry is gearing up to plant an additional 10,000 hectares thereby creating 13,000 new jobs over the next 3-5 years because it takes at least 3 years before new apple trees begin to bear fruit. The APAP included the deployment of a range of policy and financial resources to bring 1 million hectares of under-utilised land into full production over the next 5 years. This included 238,000 hectares for Soya bean production and expanding the over 100 000 hectares which was currently under production across the country through the Festa Tlala programme. The Festa Tlala programme finds its expression in many projects such as the Diyatalawa Community Property Association (CPA) in the Maluti-a-Phofung in the Free State, comprising of 51 beneficiaries, which has planted 553 hectares of maize and 200 hectares of beans. Another example given was of Mrs. Maria Mlungu who planted 116ha of maize that was sold through the World Food Programme Initiative. In the 2013/14 DIRCO donated R180 million to the World Food Programme towards humanitarian assistance to ameliorate the impact of the drought in the Kingdom of Lesotho. Through this initiative 268 metric tons of white maize was procured from smallholder producers in 2013/14 and 4 300 metric tons of both white maize and sugar bean in the current financial year 2014/15 from smallholder producers in Eastern Cape, North West and Gauteng Province. This initiative confirmed that as long as commodities produced by smallholders met the standards of the World Food Programme, there was no reason to exclude smallholders from other local and international market opportunities.

Another area of attention was the strengthening and alignment of DAFF’s public entities, the Agricultural Research Council (ARC): and the National Agricultural Marketing Council (NAMC) in particular, which has been actively involved in the development of APAP over the past 18-months. The research and data bases from the ARCs Soil Testing Laboratories were used in the spatial analysis and maps which were developed to determine which commodities could be produced in which places. Currently DAFF is enhancing these maps with data from other government departments on water sources and economic development zones. DAFF had also been working with ARC to develop a business case, which could be presented to National Treasury for consideration in the next budget cycle for multi-year funding to develop new cultivars or vaccines or undertake other critical research. DAFF is aware of the directive to review the location of key public entities, in line with the recommendations of the report on the Review of State owned entities. The ARC is therefore currently undergoing an external evaluation. This is an institutionalised process for all science councils that took place every 5 years. The outcomes of this evaluation would be communicated to the Committee when available. The National Agricultural Marketing Council (NAMC) also supported the APAP with economic analysis and their expertise in value chain mapping. Furthermore, NAMC is the coordinator for Strategic Infrastructure Project 11 that pertains to Agro Logistics and Rural Infrastructure. The Perishable Products Export Control Board (PPECB) has committed to expand the number of smallholder farmers with SA GAP Certification. Similarly the Land Bank would also expand the number of smallholders benefiting from its services. DAFF was also working with Onderstepoort Biological Products (OBP) on a business case to secure funding to ramp up vaccine production.

The budget was a crucial focus touched on by Prof Vries. In the current financial year the Department of Planning, Monitoring and Evaluation reported to the Committee that DAFF’s targets were below the projections in the NDP. DAFF has had a severe budget cut of over R230 million in 2015/16 and similar cuts in subsequent years. In the context of the 2015 Estimates of National Expenditure, there is a worrying trend in that whilst the majority of departments enjoyed significant increases or budget cuts below 100%, DAFF was the only department that received a cut of minus 309.4%. If DAFF did not have the budget to implement the entire inspirational and widely supported programme, the above listed impact would not be realised. DAFF had not had the time to interrogate the data and would therefore like to undertake some of this analysis and share it with the Committee over the next few days. An excerpt – (Table 5 – Amounts to be appropriated from the national Revenue Fund for 2015/16) listing the budget cuts and increases was circulated for the attention of the members.

Discussion
Mr T Ramokhoase (ANC) emphasised that the Committee was still in dire need of the Integrated Planning, Monitoring and Evaluation Plan as it would enable the Committee to assess whether the Department was on the right track or not. Monitoring by the Department should be at the backbone of their efforts and not a once and for all endeavour. It was encouraging that the relevant protocols have been concluded with other international countries, however, he asked DAFF to indicate the farmers that would be beneficiaries of the programme so that the effectiveness and target area be assessed. He asked whether DAFF could indicate any structure that had benefited from the NAMC in getting markets for their products because, scanning through KZN, Johannesburg, Eastern Cape and Gauteng, he had not come across any structure that had signified their benefiting from the scheme. Assistance given by DAFF must reflect over time a relative decrease in poverty among the farmers.

Ms A Steyn (DA) was excited that it seemed for the first time in a long time she was seeing a ray of light as regards the Department. However, some realities had to be taken into consideration. There was a need for the Committee to get a presentation from the Portfolio Committee on Rural Development and Land Reforms on the implications of the proposed plans for land reforms. People were getting extremely negative as innovative ideas were constantly being brought up but the farmers were not given the space to grow their industry despite the large amounts of land available in the market. She pointed out that even some farmers had complained of being threatened if they did not comply with laid down rules. She emphasised that it was crucial for the Minister to be summoned to the Committee to give responses to some policy issues. The agreement with China was a laudable step but could South Africa achieve its aim of importation of maize to China with the impact of the drought? What disaster plan did DAFF have in place to curb the impact of the drought? She had recently received phone calls from farmers that would want to put their farms up for sale because they could not service the debt. If many farmers may not plant next year, the country should then imagine what would happen the year after. On the examples of the successful projects mentioned by the DG in her presentation and the plans that had been put in place going forward, she was interested in knowing how long it would take for implementation in provinces as it had been observed in the past that so many resources had been spent on projects with no obvious results though few successes had been seen. How would funds expended on these new projects be monitored to ensure that it produced the maximum benefit? The Department should liaise with commercial farmers on a 50/50 project to implement land reforms in the fallow areas and where the failed irrigation programmes existed as many of the projects that had succeeded were as a result of a private/public partnership.  Furthermore, most farmers had a signed agreement with a bank or a coop as most of them did not have cash to plant, therefore the loan must first be repaid before the farmer could assess his profit. DAFF must therefore work with markets massively to ensure that small-time farmers grow because the market is the key.  She gave an illustration of a potato farmer that had to leave the huge number of potatoes in the ground to rot because the amount that would cost them to harvest and take the potatoes to the market was too enormous and could not afford it as it would lead to a loss.  She was optimistic that if all these issues could be dealt with and strengths harnessed, agriculture could be the game changer for South Africa. She expressed her concerns about the budget cut of the Department.  What was the reason for the cut? Could it be because of the mismanagement of the previous year’s budget? It is essential to note that DAFF may not receive a bigger budget if there was no realistic plan to judiciously appropriate the funds given.  

Mr Z Mandela (ANC) reiterated that DAFF was the worst Department in terms of loss as regards the budget cuts. He was interested to know the reasons for the drastic cut of the budget. Could it be an indication of the failure of the Department regarding spending or in reaching out to the people and also in ensuring that their programmes were implemented as quickly as possible? What was the Department doing regarding vast amounts of land that were lying fallow and unutilised for example in the Eastern Cape? How is the Department ensuring that young people especially from rural communities were prioritised and given bursaries so that they could use the land? How could young people afford themselves of DAFF’s bursaries and internships? He had noticed that in Butterworth and its environs, so much maize had been planted, who planted the maize, was it the Department of Rural Development and Land Reforms or was it DAFF? He wished to understand why at times the Department of Rural Development and Land Reforms were carrying out the work that should be done or spearheaded by DAFF. Why should the Department of Rural Development and Land Reforms front the programmes that should be fronted by DAFF? He gave examples of some communities where these had occurred. He gave an illustration of the Mandela School of Science and Technology that was opened in January 2014 by the State President and being funded by Siemens as one of the State of the Art schools established in rural South Africa. The funding by Siemens was to ensure that modern technology was not foreign to the rural community and young people were trained and educated in the field of agriculture. Did DAFF have programmes in place that could assist it in partnering with such agricultural schools especially to aid the students to find work afterwards? How could young people gain access to internship programmes? Who could be contacted at the Department? This information should be disseminated to young people as they were in need of such information.

Mr M Filtane (UDM) voiced his frustration regarding employment creation and proposed that DAFF start a programme that would absorb young people into the Department for 3 years, after which the students would be released to start their own agricultural enterprise. This step could curb the incessant long list of applicants into the Department. The stakeholders and institutions mentioned by the DG in her presentation did not appear to factor in the public in their operations. To what extent has DAFF consulted with the general public in this regard? With respect to the high costs of animal feed prices, he wanted to know why South Africa could not produce its own feed. What is the principal constraining factor for this?  It was noted in the presentation that there was an increase in the number of smallholder producers from 164 000 to 400 500, are these producers profitable? Information received shows that many of these smallholder producers were still operating but they were not happy and were far from profitable. He insisted that if a business is not profitable, there was no reason to keep it going. He understood the process of land acquisition; however, how and where DAFF would get suitable lands appears to be a problem especially for the kind of production being envisaged. On budget management, he reminded DAFF that the Department had conceded in another report that its monitoring and evaluation strategies were ineffective; it would therefore be reckless for National treasury to increase the Departments budget when the Department itself had acknowledged this hitch. It made a lot of sense for the budget to be reduced as long as the Department constantly proves that it cannot manage public finance.  It had been observed based on previous Committee oversight, that some officials had deliberately lied or misrepresented facts and figures. This meant that reports given could not be relied upon. The action was also a criminal offence. He appealed to the DG to deal decisively with such matters.

Mr P Mabe (ANC) agreed with Ms Steyn that agriculture could be a game changer in the economy but his most worrying factor was the budget cut. The budget cut would make it quite difficult to implement the prescripts of APAP by the Department.  The Department had linked its goals to about 3 outcomes in the National Development Plan, which were outcomes 4, 7 and 10.  Outcome 7 was involved with rural development and food security so the Department of Rural Development and Land Reforms may tend to think that they are the ones that should spearhead such function and even outcome 10 was on the management of environmental assets and resources which would make the Department of Environmental Affairs believe that they should be in charge of the project. Issues like this should be better channelled by the DAFF. The Department could not drive the robust programme of food security if it did not give the people the seeds to plant and if it did not maximise the use of productive land. DAFF should present to the Committee its own attempts to make the agricultural sector sustainable especially in the face of drought and no irrigation systems. He pointed out the concept of water harvesting.

Mr C Maxegwana (ANC) emphasised that surely there were reasons for the budget cut. If DAFF were not doing the right things, then the other Departments that have been linked to DAFF would take over its responsibilities and make DAFF inconsequential. The 2 500 jobs created by DAFF were not sustainable jobs.  DAFF must endeavour to create sustainable jobs in agriculture for the rural communities so that generations after would be well catered for. He wanted to know why the agricultural school in Middelburg in Grootfontein seemed neglected. As it is an agricultural school that DAFF is responsible for, the Committee must of necessity schedule an oversight visit to the school.

The statement made by Mr Maxegwana on the Middleburg Agricultural College was widely applauded by the members.

Ms Z Jongbloed (DA) also expressed deep concern about the budget cut and the probable reasons for it. She was concerned about the effect it could have on Fisheries. Last year the President commissioned Operation PHAKISA – to unlock the wealth of the ocean but she had always imagined where the funds for its implementation would come from. In view of the budget cut, the Committee needed to be reassured by the Department that it would not just put plans to paper without any implementation mechanism in place. Was operation PHAKISA still on track? Her second source of concern was the rollout of the small-scale fisheries plan. Deliberating with the fishing communities along the coasts, she observed that they had been experiencing huge problems with trust, transparency, corruption and such. The first implementation date for the rollout of the small scale fisheries plan was June 2014 but in a meeting held in December, it was communicated that the roll out would be in June 2015, but further information received has shown that the roll out would only be expected to kick off next year as there was still much to be done. There is a lot of expectation from the coastal communities, as the plans were perceived as a solution to poverty. She asked whether DAFF had the money for the rollout of these programmes and was able to meet the deadlines that had been set, as it could not afford to waste resources at this point. One of the biggest problems that the fishing communities had been witnessing since the Interim Relief System started was that the list had not been made accessible to the people in the communities even though the Minister had assured that anybody could have access to them. There was a need for transparency regarding the fishery plan.

The Chairperson insisted that DAFF give the Committee a feedback on the Middelburg Agricultural School. The ongoing engagement by the Committee and the Department was geared towards the finalisation of the APPs and the Committee’s expectation must be clearly communicated to the Department especially when interacting with the official documents that would make DAFF account to the Department on a quarterly basis. If DAFF did not take up her responsibilities, other Departments would. For example the issue of the database for small time farmers had been left hanging for too long, and DAFF must be proactive in getting it in place. 30% of the state budget which supposed to benefit small holder farmers is left, therefore DAFF must come up with programmes which would link the small holder farmers to schools, hospitals and correctional services. The rates of the Land Bank should be reconsidered. The Land Bank is a developmental bank and therefore rates should not be charged like other commercial banks. She reminded the members that there was an outstanding meeting with the Minister of Finance and Minister of Agriculture regarding this. She wanted to know what steps DAFF had taken towards the disappearing money, as those monies were loans that were to be awarded to other people. She commended the Department for the identification of commodities. It was a right approach; however, as DAFF identifies them, transformation agendas must be put in place. Treasury must be called upon to justify and create an understanding of the budget cut. It is also essential that the person that is dealing with the DAFF budget must be present in Portfolio Committee meetings, as this would ensure a better understanding by the treasury of what is at stake. She told the DG that her responses should exclude issues on accountability and fisheries, as these issues would be dealt with extensively on the 6 and the 10 March.

Responding, Prof Vries confirmed that DAFF also shared the same concerns as the Committee members regarding the budget cut. She and the team were just waiting for the appropriate time to deliberate with National Treasury on the matter. She explained that since August 2014, DAFF, National Treasury, the Department of Rural Development and Land Reforms and the Land Bank had been involved in several meetings and workshops. One of the aims of these engagements was to make sure that relevant departments work together and effectively apply their budget.  Another reason was to ensure that every Department used their budget for their mandates so that duplication of efforts could be minimized and resources could be used more effectively. DAFF and the Department of Rural Development and Land Reforms had been working together and had come up with an Integrated Funding Model to eliminate duplications from within both departments. Members had to have a better understanding of the mandate of each entity, as it would assist the members to have reasonable expectations from the entities. NAMC’s mandate is not to support smallholders; it is an agricultural board set up to advise the Minister on marketing issues whilst the ARC’s mandate is not to plant but to be involved in research. It would therefore be essential that the mandates of entities must be clarified.  DAFF has derived extreme lessons from the World Food Programme, one of which is that DAFF must not deal with individual farmers but pool them in few numbers together into cooperatives. The Department was able to put together 18 coops in the first year. It is a wrong assumption to think that DAFF would drive the whole value chain; however it is the people in the Department of Small Businesses that had the enterprise to do this. DAFF is well aware of the drought and its effect especially in the provinces where it has impacted on the crops. South Africa would not be able to export maize and may even have to import a small percentage, however, NIMC would advise the Minister on the current import prices vis-a-vis the local prices. She explained that the Department did not have the intention that its projects to fail. She pointed out that even several projects that succeeded had failed at one time or the other, however on the issue of the APAP; it had been approached with the best scientific method available at the Department’s disposal. Some DAFF officials had just spent two days each in all the provinces so as to understand the peculiarity of each province and to put on the table the most effective business plan. It was true that sometimes there were inconsistencies in the reporting of DAFF’s officials and this happened many times because what put on paper was not what was necessarily implemented.

Mr Ramokhoase interrupted the DG with the permission of the Chairperson. He expressed his annoyance on the responses given by the DG; most of her responses were not impressive. Members understood the issue of different mandates and concurrence and were not uninformed as to what they represented. These issues would have to be trashed at a later and more appropriate time.        
     
The Chairperson asked the DG to briefly round up her responses. She advised that issues that needed more dialogue be suspended to the subsequent week.

The DG finalised her statement and handed over to the DDG, Food Security and Agrarian Reform.

Mr Joe Kuobokoe, DDG, Food Security and Agrarian Reform (FSAR) commented on two areas that were the internships and the bursary scheme of the Department. He emphasised that everything revolved around the budget; therefore, the budget is the major constraint to proper implementation of these two strategic programmes. He explained that each governmental department is supposed to recruit a number of interns annually equal to 5% of its staff compliment. DAFF has a little over 7000 employed staff members therefore 5% of that will be a little over 300 and obviously the Department would not have enough budget for that, so on an annual basis, the Department is supposed to recruit around 300 interns. DAFF has a popular accredited and transparent system of recruiting agricultural graduates. Advertisement is made around August every year. Recruitment exercise is carried out about December every year and the successful candidates resume 1 February each year. The applications were always so overwhelming out of which a minimal number of 250 interns would be employed because of the budget limitations. The bursary scheme on the other hand provided comprehensive funding to young people. When DAFF promotes its agricultural programmes and the interested young people apply, those that meet the necessary requirements would be funded to Universities and Universities of Technology. This funding is very expensive and included all the needs of the student including books, meals, accommodation and tuition. These students are sent to learn critical and scarce skills in agriculture. Another initiative of the Department was to target children on farm schools. DAFF recently embarked on a college revitalisation plan that would be funded by National Treasury. On an annual basis, certain number of millions would be allocated to these colleges. There were only 12 colleges of agriculture with one in Groenfontein named Groenfontein Agricultural Development Institute. The college is being treated as one of the directorates in the Department. The history of the college is well known that it lies between the Eastern and the Northern Cape. After 1994, there were contestations between the two provinces; the Department then took over the college. Each of these colleges is given a yearly budget. The Zolo College was reopened this year. It was previously closed down because its programmes lost accreditation. However for the first time because of revitalisation, the college would be recruiting students that would be trained in Para-veterinarian. DAFF has a database of smallholder farmers, however more work is needed on expanding the database so that it could cover majority of the smallholder farmers. He also assumed that all the issues raised by the members on schools were about colleges of agriculture, the country also has schools of Agriculture, however, these schools report back to the Department of Basic Education but most of the feedbacks received from these schools were not good stories to tell.

The Chairperson suggested that at the next meeting the DG could share with the members the Integrated Funding Model. The DG was asked to commence with the next presentation.      

Progress Report on the Alignment of Services between the Department of Agriculture, Forestry and Fisheries and Its Entities and Provinces, 27 February 2015
The Director General of DAFF, Prof Vries, furthermore reported on the progress of the alignment of services between the Department of Agriculture, Forestry and Fisheries and its Entities and Provinces. Government delivers services to citizens through two main machineries of state - directly through government departments (at national, provincial or local spheres) and through public entities (including associated institutions and state owned entities). There are currently five Public Entities reporting to the Minister of Agriculture, Forestry and Fisheries, namely the Agricultural Research Council (ARC), Perishable Products Export Control Board (PPECB), National Agricultural Marketing Council (NAMC), Onderstepoort Biological Products (OBP) and NCERA farms. There are currently possible misalignment and duplication of effort between what the DAFF does and what its Public Entities and the Provincial Departments of Agriculture (PDAs) do. Through the Medium Term Strategic Framework (MTSF) and the implementation of the Agricultural Policy Action Plan (APAP) the misalignment and the duplication were being addressed. The MTSF and APAP having been informed by the National Development Plan (NDP), force the machineries of government to work together instead of working against each other and duplicating efforts. The APAP environmental scan looked at the sector as a whole and identified what needed to be done, what it would cost, where and who would drive and who would support. APAP Implementation Plans were also on track and would be implemented from 1 April 2015. 

The current duplication of effort between the ARC and the Research Directorate in the DAFF and between the NAMC and the Marketing Directorate in the DAFF were highlighted by the DG. NAMC was established in terms of the Marketing of Agriculture Products Act, No 47 of 1996, as an advisory body to provide strategic advice to the Minister on all agricultural marketing issues, to improve market efficiency and market access by all participants, to optimise export earnings, and to improve the viability of the agricultural sector. As part of executing its mandate derived from the Act, NAMC has in certain circumstances duplicated the work carried out by the Department in broad areas such as trade, marketing support, livestock development programmes, etc. The Department noted the duplication and initiated a process of collaboration to eliminate the overlaps and streamline the functions between the Department and the NAMC on matters relating to agricultural marketing. This issue of the clarification of the roles and responsibilities between the Department and the NAMC would further be clarified in the Marketing Act that is currently undergoing a review.
The areas of duplication between the Directorate: Policy Research Support and the ARC were:-
Diagnostic services including the rendering of tests and/or identification for genetic material - DAFF has a Directorate for this purpose with infrastructure in various parts of the country to perform diagnostic services. The ARC, on the other hand, maintains laboratories and related infrastructure for similar purposes. There is a need to harmonize and integrate the provision of these services to avoid duplication.
Foresight and Economic Research - There is a glaring gap in the services and focus of the ARC related to economic research to the extent that the Department sources this service most often from the Universities, and to a limited extent from the NAMC on some aspects.
Research Frameworks and Agenda - This is the competency of the DAFF, and the current ARC Act is being amended to rectify the conflict.

The PPECB and the OBP’s functions compliment what the Branch: Agricultural Production, Health and Food Safety in the DAFF is doing.

The current duplication of effort between the Department and the PDAs is in the following areas:-
Support to smallholder farmers, which takes place at grassroots level.
Technology Transfer and Extension Services - The DAFF and the PDAs provide funding Enterprise Resource Planning (ERP) for the recruitment of extension officials as well as the provision of technology transfer and extension services. The ARC also has the mandate to provide technology transfer to farming communities for the technologies they develop. More often there is conflict when the ARC officials provide services in the Provinces without the involvement of the PDA officials, who are mandated to provide direct support for agrarian development.
Monitoring & Evaluation of conditional grant projects is often inadequate and one of the PDAs biggest areas of double reporting is the requests from the DAFF and Department of Rural Development and Land Reform (DRDLR,) which were not always synchronized.

The lack of a national framework has created unnecessary confusion with regard to the roles and responsibilities of different stakeholders, the nature of services they are meant to provide, the gaps that exist and a guide for appropriate packages of support per category of producer. DAFF is therefore in the process of developing a framework on norms and standards for producer support which would be primarily focused on financial and technical non-financial support to address the gaps that exist where support is provided by a myriad of stakeholders, including government departments, without a national framework. There are task teams established through the APAP process and two of the task teams amongst others are for Research and Innovation and for Market Access. The composition of the task teams is made up of the DAFF, DRDLR, ARC and NAMC. These task teams would plan together and share responsibilities that would address the issue of duplication and misalignment.

To promote synergy between the DAFF, Public Entities and Provinces, DAFF had recently developed an integrated planning framework, which defined the collaboration of activities between DAFF, Provinces and Public Entities. The framework defined how strategic planning processes and reporting should be undertaken between DAFF and these role-players. It spelt out how the DAFF should take a lead in informing the Public Entities on Priority Areas since their mandates were derived from DAFF. This framework would be implemented fully from 1 April 2015. The Deputy Director Generals (DDGs) of DAFF were also allocated to Provinces and Public Entities to ensure adherence to performance with respect to government policy and priorities. This would greatly assist in identifying areas of misalignment and duplication. The DDGs would ensure that the Department engages with the detail of the annual budget and corporate plans of the Public Entities and Provinces with the purpose of preparing advice to the Minister on the subject matter. The Annual Reports of the Public Entities would also be submitted to the Director-General for submission to the Minister. The Director General would meet with the Head of Department (HODs) and the Chief Executives Officers (CEOs) of the Public Entities at MINTECH on a quarterly basis to discuss implementation of the plans and to prepare for MINMEC, where necessary.
The Director-General would also meet with the CEOs of the Public Entities quarterly to discuss matters of operational performance. Each Public Entity would submit to the Director-General of the Department an annual budget and corporate plan contemplated in Chapter 6 of the Public Finance Management Act, 1999 (Act No. 1 of 1999), Strategic objectives and outcomes identified and agreed on; Strategic business initiatives; Key performance measures and indicators; Risk management plans; Fraud prevention strategy and plan; and Financial plan reflecting revenue and expenditure projections and balance sheet management for onward submission to the Minister.

Discussion
The Chairperson asked whether there were other issues that the Department would want to notify the Committee on especially on transformation issues, AgriBEE and the Forestry Charter.

Ms Elaine Alexander, DDG, Economic Development, Trade Development of DAFF reminded the Committee members that for a while now, there had been a number of issues around the Forestry Sector Charter Council which warranted the need for an Executive Director to be appointed to drive, she was therefore pleased to inform the members that on the 1 of January 2015, an Executive Director was appointed and all the subsequent issues therefore, would be driven through the Executive Director.

The Chairperson replied that the step taken was good news that was well appreciated.

The Director General added the other outstanding issues that were the Forestry Special Analysis and an update on the Finalisation of the National Policy on Extension and Advisory Services. She had given a presentation on the National Policy on Extension and Advisory Services to the Committee towards the end of last year

The Chairperson refuted the statement. She insisted that the presentation was still outstanding and that the presentation must be given on 10 March as part of the quarterly report.

Ms Steyn remembered that towards the end of last year, there was an attempt by the Department to make presentation but the presentation was postponed. However, she could not remember what presentation it was.

Mr Ramokhoase commented on the annexure to the documents distributed to the members. Having gone through the annexure, it was important for the Committee to engage with DAFF on the issues raised. He proposed that by the next meeting, the Department must come with the actual in their annexure as that would assist the members and curb backward discussions.

The Chairperson supported the comment. She told the DG that when the Committee requested information, specifics must be given and not general knowledge. All outstanding issues including the Extensions and Advisory Services, Fisheries and the NAMC presentations would be presented on 6 and 10 March. She insisted that the programme be forwarded to the Minister, as it was important for him to be present.

Integrated Spatial Analysis on land capability and land use for Agriculture and Forestry, 27 February 2015
Mr Mmaphaka Tau, Acting Deputy Director General of Forestry and Natural Resources Management presented the Integrated Spatial Analysis on land capability and land use for Agriculture and Forestry to the Committee. He touched on food security and the production challenge, land capability assessment, classification and evaluation and the preservation and development of Agricultural Land.

The South African food production challenge and a steep decline in the area of High Value Agricultural Land available for crop production in South Africa had persisted. The current DAFF estimate was less than 0.25 ha per person per annum. He presented a chart that indicated the South Africa’s food production challenge vis-a-vis the granted prospecting and mining rights per province. The chart reflected that many of the High Value Agricultural Land – HVAL had been issued on mining rights.
 
He defined Land Capability as the extent to which land could meet the needs of one or more uses, under defined conditions of management, without permanent damage, the expression of effects of physical factors on the total suitability and potential for use for: Crops that requires regular tillage; Grazing; Forestry and Wildlife. Land capability involves consideration of the risks of damage from erosion and other causes; the difficulties in land-use caused by physical factors, including climate - rain-fed production; and the production potential. He touched on the 2014 Land Capability Evaluation System that started April 2014. In the 2014 / 15 financial year, issues of National climate, soil, terrain and land capability models were dealt with in Mpumalanga, Western Cape and the Eastern Cape. The 2015/16 financial year would deal with the outstanding 6 provinces and the Integrated Geo-database.

Mr Tau enumerated the advantages of the 2014 Land Capability Evaluation. He presented the 2014 Land Capability Evaluation System, the Agricultural Potential Zones Conceptual Diagram, the fully
Integrated National Geo-referenced Database and all the facets of agricultural land use planning- crops, forestry, animal adaptability, agro-ecosystems management, environmental risk and impact assessments, land degradation risk assessment, framework for future monitoring, climate change, etc. He also highlighted the Draft Framework Policy and Bill on the Preservation and Development of Agricultural Land which included Spatial planning – Suitability modelling and Spatial zoning and associated regulations - Primary Food Production Zones.

Mr Tau concluded that there was a continued decline in High Value Agricultural Land with the major drivers being: Population growth, Urbanisation and related infrastructure and Mining. The advantages of spatial analysis and modelling regarding Land Capability, Land Suitability and Land Use were: Quantifying spatial impacts in relation to food production, Provision of a more refined spatial dataset for integrated planning and Primary Food Production Zones and associated regulations per zone will guide development patterns in a proactive manner

Discussion
The Chairperson reminded the members of legislation passed last year by the Department of Rural Development and Land Reforms called SPULMA. iIt would have been auspicious if the same opportunity had been used to secure a relevant bill for agricultural land.
 
Ms Steyn recalled that at the time of SPLUMA bill, there were discussions around agricultural land; however she had been informed that there was another bill in place that could regulate the issues of the land vis-a-vis agricultural land. However, it is evident that another bill that would speak specifically to the classification of land and the high value of agricultural land is essential. She expressed her utmost concerns regarding the huge amount of land that the country had lost to mining and even more outrageous is the fact that these lands could no longer be used for agricultural purposes. It is important to note that agricultural lands must be protected at all costs because the people cannot eat gold.

Ms Jongbloed agreed that preservation of agricultural land was very crucial but proceeds from the forest were equally important. In 2005, there was a study that showed that by 2015, 800 000 hectares of land would have been reforested. What progress had been made so far regarding this?

Mr Filtane wanted to know whether the public had access to this kind of information. The Department must think of a systematic way of notifying the public of what type of land was needed to produce what as this information would enhance proper decision-making. Before mining rights are issued, are consultations made with the Department and could the Department either endorse or raise an objection as to the siting of a mining facility.

Ms Steyn, on the Land Care Programme, asked why this kind of information could not be used by the Department to facilitate the Department to put laudable programmes in place to ameliorate the situation at hand.

The Chairperson confirmed that the presentation was an informative one but that a lot of work still had to be done to gain proper understanding of the concepts. A policy that would secure the land in the meantime could be passed. As much as the report presented was appreciated, the report did not propose what could be done to curb this land wastage so that the economy could be effectively grown. She suggested that the information shared with the Committee should also be shared with the Department of Mineral Resources.

Mr Tau alluded to the comments made by Members regarding competing developments eating deeper and deeper into agricultural lands. Currently, the mandate of the subdivision on agricultural land does not make provision to comment on whether a land could be used for mining purposes or not. This is therefore a real challenge. Some of these concerns had been shared with the Department of Mineral Resources and they had also shared their plans to regulate the encumbrance of land for mining to accommodate more agricultural land use. However, there were still communal areas where the subdivision of land did not apply which meant that the act could not be enforced. On afforestation, the Western Cape, Limpopo and Mpumalanga have been identified and about a 100 000   hectares of land had been identified in the Eastern Cape and KZN but this was also subject to water licensing. Proper processes are in place with the Department of Water and Sanitation to facilitate the achievement of the objective. In provinces, DAFF has officials Resource Auditors and they are responsible for the conservation of Agricultural Resources Act. They organise awareness programmes and the Department encourages them to include subdivision issues or change of land issues during these awareness programmes. These Resource Auditors also comment on how to manage degradation from the agricultural point of view, however they cannot effect any decision as to whether a land is used or not.

Mr Filtane appreciated the explanation given. He passionately emphasised that the time had come where DAFF must bring to the attention of Cabinet the serious consequences going forward of what was happening. As a nation, millions could not be battling to have food on their table and we would accept a situation where mining activities would reduce the amount of productive land that could be used for agricultural purposes. There is a need to use these lands to produce the number one basic need of the people, which is food. Mining is a secondary need. This Committee must also conceptualise a legislation that would give the Department exceptional rights that would make the agricultural need of a land supersede that of mining. These decisions need to be made across party lines because food is a primary concern.

The DG clarified the date for the presentation of the APAP to the Committee. She also emphasised that APAP was somehow above DAFF because it is an intergovernmental revitalisation of agriculture. It was just that DAFF was the driving agent.

Ms Steyn raised her concerns regarding the realignment between the different entities. How did the different entities link up into DAFF? Would DAFF refer to these entities in its annual financial reports when a project was carried out by another entity? She wanted clarifications on who spearheaded the development of a new vaccine for example or who was responsible for the new research for a drought resilient crop.

Mr Ramokhoase replied vehemently that there was no need to worry about who was in charge of what, the main issue was the product that must be delivered. The when, where and how was more important. With regards to pronouncements, DAFF must consult the relevant resolutions and must ensure that more people are not sought to do the work. More people would cause more waste but less people could get the work done faster.

The Chairperson reminded the DG that these issues on alignment had been previously raised but had not been sorted out. As much as the members understood the mandates of each entity, it has been observed that NAMC that is an advisory entity is carrying out projects in communities. The Committee has made a commitment to assist the Department but the Department must furnish the members with the plans and all necessary information so that provinces could be called to account for the grants collected. It would also assist the Committee with its oversight functions.

Mr Filtane reminded the DG that he had suggested the previous year that the Department must ensure that they instruct their entities to align themselves with the mandate of the Department. 

The DG responded that now that the Department was well aware of what the Committee expected, it would work on the issues raised and make sure that its entities are aligned to the Department’s mandate.

The Chairperson thanked the DG and the team for the informative session. She excused DAFF from the meeting.

Adoption of Minutes
Minutes of Committee meeting held on 17 February were considered and adopted.
                                       
The Chairperson thanked all in attendance. The meeting was adjourned.