The Department of Agriculture Forestry and Fisheries (DAFF) and the Department of Rural Development and Land Reform (DRDLR) jointly presented on the implementation of the One District, One Agri-Park programme in the context of the framework of the rural economic transformation model.
DAFF’s presentation focused on its role in the revitalisation of agriculture and the agro-processing value chain in the Agri-Parks programme, which would be contributing to the priorities outlined in the State of Nation Address in trying to ensure growth in the agricultural sector. The intention to grow the sector would focus primarily on ensuring that there was growth in the agro-processing part, growth in the sector as a whole, and also on growing jobs. The key challenges were high input costs, particularly in animal feed, competing interests for land, anti-competitive behaviour which resulted from market dominance, climate change in the form of droughts, floods, and fires, and the degradation of soil as a whole, which affected productivity. Agri-Parks had been proposed as one of the interventions to ensure growth.
The DAFF’s role in the Agri-Parks was largely around provision of services, which ranged from consumer support, capacity building, extension support and support to market access. In comparison with other countries, South Africa provided the lowest support to producers. This was not good for growth and it was one of the major areas that had to be worked on, otherwise all other efforts would become useless.
A number of value chains had been identified in poultry and red meat production, fruits, fresh produce, sugar and wine. Technology development and innovation was necessary for inroads to be made and structures developed. The agenda of research, innovation and technology development had to be enhanced, otherwise it would not be possible to improve the situation. There was also a need to increase the current human resource capacity and expertise, which was limited.
The DRDLR’s said the concept of Agri-Parks drew from existing models in the country, as well as the rest of the world. These included educational farms, experimental farms, collective farming, farm incubation projects, agri-clusters, eco villages, urban-edge allotments and market gardens. The proposed model would make use of both public and private land and would serve as a transition zone between urban and agricultural land uses. Agri-Parks would evoke a traditional model of an agricultural business park or hub, where multiple tenants and owners operated under a common management structure. They would provide networks of contacts between producers’ markets and processors, as well as the physical infrastructure required for transforming the industry.
The Agri-Parks would be farmer-controlled and the Department was currently working on defining how farmer-control would occur. The model would have a strong social mobilisation component so that black farmers and agri-business entrepreneurs were mobilised and organised to support this particular initiative. It was intended to have various activities around processing by adding other services around social services, retail services and so forth. There would be linkages with surrounding municipalities and villages to ensure that production elements and other activities were localised.
The strategic objectives of the Agri-Parks were the establishment of the parks in all districts of the country. They would promote growth of the smallholder sector by contributing to the 300 000 new small-scale producers, as well as 145 000 new jobs in agro-processing by 2020. The Agri-Parks would be an innovation system of agro-production, processing, logistics, marketing, and training and extension services. There would be three components, the first component being the Farmer Production Support Unit (FPSU) which would have a rural outreach unit connected with the Agri-Hub itself. The FPSU would do primary collection, some storage, some processing for the local market and extension services, including mechanisation. The second component was the Agri-Hub Unit, which was where key processing would happen. The unit would also carry out packaging, logistics and training.
The DRDLR had already committed R2 billion for the current financial year which would be used in all of the 44 districts to roll out the Agri-Parks. The money would be used differently by the provinces, depending on the phases of the project as they emerged in terms of the business plans per district. Some of the money would be utilised for infrastructure and others on the production element. This would be crucial if the programme was to become a success.
Members were concerned that the R2 billion set aside for the programme was insufficient. They were also concerned with the criteria used to identify farmers for participation in the Agri-Parks. The DAFF was asked about what it was doing to ensure that there was human capacity to replace the ageing research and development scientists who were close to retirement, but whose skills were not being transferred to their potential successors.
Chairperson’s opening remarks
The Chairperson welcomed Members of the Portfolio Committee on Rural Development and Land Reform and the Chairperson and Members of the Portfolio Committee on Agriculture Forestry and Fisheries. There was going to be a joint sitting because of the overlapping issues, because without land there would be no agriculture, so in some instances the Committees had to work together to achieve the intended goals.
The agenda for the day dealt with the issue for Agri-Parks. The President in his State of the Nation Address had mentioned that 27 Agri-Parks would be established in the 27 districts of the country. The Minister had also referred to this, and the annual performance plan (APP) of the DRDLR presented to the Committee had highlighted that one of its activities would be the establishment of Agri-Parks in all 44 districts. It had therefore been decided to have a joint meeting with the Portfolio Committee on Agriculture Forestry and Fisheries to share information and to understand what the Departments were doing. The project involved all spheres of government, nationally, provincially and locally. The Departments would brief Members about the project, where it would be established, the impact of the project, how the project would benefit the youth, women and people with disabilities, as well as society at large. All the programmes should be beneficial to the people, and budgets for different departments had been approved with the understanding that the budget was a tool that was used to change the lives of the poor people.
Apologies had been received from the Minister and Deputy Minister of Agriculture, as well as the Director General. Apologies had also been received from the Minister of Rural Development and Land Reform, as well as the two Deputy Ministers. Two members of the Agriculture Portfolio Committee, Mr Z Mandela (ANC) and Ms T Tongwane (ANC) were attending other portfolio committees.
The Chairperson invited the Department of Agriculture Forestry and Fisheries (DAFF) to make a presentation.
DAFF on Revitalisation of the Agriculture and Agro-Processing Value Chain
Mr Mortimer Mannya, Deputy Director General: Agricultural Production, Health and Food, DAFF, said the Department would present on the role that it would play and the DRDLR would provide more details. The presentation as requested provided an update to the joint Committees on progress made on the revitalisation and the linkage between the Agricultural Policy Action Plan (APAP) and Agri-Parks.
Various departments were contributing to the priority stated in the State of Nation Address (SONA) in trying to ensure growth in the sector from the current 2.5 percent, and growing at a rate of 0.5 percent per annum. The intention to grow the sector would focus primarily on ensuring that there was growth in the agro-processing part, growth in the sector as a whole, and also on growing jobs. The focus was on the three issues and it was hoped and believed that the growth target would be improved.
However, there were challenges that had to be overcome for the indicated targets to be realised. The key challenges were high input costs primarily in animal feed, and this had to be overcome if growth was to be realised. A second challenge was competing interests for land, which had to be managed and balanced appropriately so that there was space for the various sectors that required land. Agriculture was concerned about the continued loss of high productive land to other non-agricultural uses, although it appreciated the need for use of land by non-agricultural sectors. The third constraint was in the anti-competitive behaviour which resulted from market dominance. This was another area where the Department needed to make inroads to realise growth. Climate change was a challenge which was realised in many ways such as droughts, floods, and fires, but also the degradation of soil as a whole which affected productivity of the soils. There was also a reduction in water supply, whether it was rain or stream flows.
Several interventions had been proposed and one of them was Agri-Parks, to ensure growth. Other interventions were fast-tracking land reform, improving producer support, ensuring that the nine identified strategic value chains were developed effectively, research and innovation and ensuring greater support for market access and trade development. The interventions would happen with specific enablers, such as policy certainty in a number of areas. There was also an assumption that high potential arable land would remain available. Other enablers were intensifying agriculture and agro-processing labour, otherwise there might be jobless growth. Also the growing demand for food and agro-products required ensuring food security.
Mr Mannya graphically demonstrated the multiplier effect that investment in the agriculture sector had on gross domestic product growth, job creation, export receipts and fiscal revenue, compared to other sectors. It was expected that every R1 million investment in agriculture would contribute ten jobs, and compared to other sectors agriculture had a greater potential for job creation and contributing greatly to the economy.
The role of DAFF in the Agri-Parks was largely around the services that the Department should provide. These ranged from consumer support, which was the Department's major role, capacity building, extension support and support to market access. The DRDLR would facilitate the physical aspect, such as access to land and infrastructure. The Department would ensure that farmers were supported to continue producing but also, when production was done, to utilise the market infrastructure made available, and the DAFF should ensure market linkages.
In terms of fast-tracking land reform, the Department had picked up the catalytic effect of the project. In the case of land reform, the strategic scope was ensuring agrarian transformation and completion and finalisation of a new policy framework. The Department was targeting to pilot ten properties, with a target of two million hectares of strategically located high-value agricultural land that had been acquired for the key value chain by 2019.
To improve producer support, the important part was to ensure that the players -- the farmers or the producers -- were supported adequately. In comparison with other countries, South Africa provided the lowest support to producers. This was not good for growth and it was one of the major areas that had to be worked on, otherwise all other efforts would become useless. The target was to increase producer support from 3.2 percent to five percent by 2019. In terms of progress, the Department was trying to finalise two types of policy -- the Comprehensive Producer Support policy framework and the Integrated Agriculture Development Finance policy -- for Cabinet submission. The Department was also ensuring that the Agriculture Training strategy for training smallholder farmers was finalised and was being implemented at the moment. The revitalisation of the agriculture school in the Eastern Cape, which was funded by the Department of Science and Technology, had also been finalised. The Department was providing support through the Comprehensive Agricultural Support Programme (CASP) and Illema to 60 943 farmers, to the tune of R2.1 billion. These were producers in areas where Agri-Parks had been identified, and who would receive support.
There were also challenges and decisions that had to be made to ensure progress and reach the set targets. The first challenge was that there were ineffective models of producer support and there was a need to continue improving in this area. There was also the absence of uniform criteria and definitions, which created confusion when not harmonised. The Department needed to work on harmonisation with various departments and agencies supporting the farmers. DAFF was proposing a new policy and model for producer support that focused on the smallholder farmer. The Department was also reviewing the existing financial instruments to see what progress had been made.
Another challenge was the slow pace in issuing of water licences. Agriculture was largely dependent on water, particularly now when faced with climate change challenges. There was a need to fast-track and emphasise it. The proposal was to submit a list of strategic projects to the Department of Water and Sanitation to prioritise the licensing processes. There was also a challenge of the proposed incentive programme for Climate Smart Agriculture (CSA), which was not funded at the moment. The Department was looking at submitting a proposal for funding to the Green Fund.
As already indicated, competing demand for land was a challenge but it was hoped that the Preservation and Development of Agricultural Land Framework (PDALF) and the Spatial Planning and Land Use Management Act (SPLUMA) would be harmonised to ensure that protection of agricultural land was dealt with. The Department would also continue to engage with the Department of Mineral Resources to finalise on how to deal with the co-existence of mining, to balance the various interests.
There were national training programmes across the country. The training programmes were for credit-bearing training and non-credit bearing training.
Mr Mannya said a number of value chains had been identified. One of the value chains was for poultry, which had the potential to contribute to one million hectares of under-utilised land in communal areas and land reform to production. There was also potential to contribute to two percent annual growth in Gross Value Add of the sector. The Department targeted to add 14 000 jobs to the current 107 000 jobs by increasing poultry production. Expansion of soya production would add another 14 000 jobs. Soya was required for poultry feed so as poultry production grew, there was a greater demand for feed and therefore there would be need to grow the number of hectares where soya was produced. There was also a target to increase the contribution of the gross value of agriculture to the GDP from the current R32.1 billion to R41.13 billion by 2019.
Within the current financial year, the private sector would invest in planting 687 300 hectares to produce almost one million tonnes of soya beans. At the same time, the public sector had acquired 1 536 hectares of land, which had increased the land for soya to 3 647 hectares. This was still not adequate, and the public sector side would still fall short.
The challenges facing this particular value chain included the fact that some of the projects that were almost ready were not moving as they should. A political intervention had been requested in Limpopo, where an abattoir had been revitalised with a state of the art poultry abattoir, which could unlock 2 000 jobs and support about 18 broiler houses around the abattoir. The abattoir had not been operational for a number of years and it was hoped that with the intervention, there would be some progress and the abattoir would become operational before the end of the year. Another challenge was import dumping, and the Department was ensuring that provinces would cluster projects and transform the projects into bankable poultry programmes. High input costs were also a challenge, and the Department was looking at public private partnerships (PPPs) with the various departments and IDC to invest in crushing facilities. Agri-Parks would also help to take this into consideration, as some of the Agri-Parks sites could also involve the poultry value chain. Infrastructure had been developed for various CASP projects in various provinces
The red meat value chain would also contribute to the utilisation of one million hectares of land that were not utilised to contribute to the annual growth in Gross Value Add in the sector. The Department had targeted to create 75 000 jobs in the beef and mutton sector. Progress made was through the contribution of the private sector, with most animals in the communal and smallholder sector. Therefore there was a need to acquire more land to ensure that there was 1.3 million hectares available to produce red meat. There was a programme of deploying veterinarians to provide support to the value chains, to ensure that there was continuous access to the market.
The challenge in this particular sector was that there was a growing demand for red meat products which was not being met. Therefore in the meantime, the demand had to be compensated for with imports. Although there was work around community veterinary services, the services were inadequate at the moment and support had to grow to ensure that veterinary services improved in totality. Support should not just be in the form of people, but there should also be facilities which would include diagnostic laboratories and a supply of the required veterinary medicines. There was also a challenge with the commercialisation of communal herds, because most animal herds were within the communal areas. The Department had to ensure there was growth in the understanding and provision of support to commercialise the herds, and that the value of the herds was realised. DAFF was proposing a buy-in and use of PPPs with various traditional authorities to expand the herds. The provision of animal handling facilities also formed part of this investment and intervention. Several projects were supported in the red meat value chain in the CASP/ Ilema-Letsema project.
Other value chain projects were wheat and other crops, fruit and vegetables, sugar and wine. The bigger challenges that had to be dealt with were around vital sanitary methods. There were also challenges in the fresh produce market related to infrastructure, which had become almost derelict. Investment in infrastructure was needed to ensure it was brought back for the benefit of various producers.
In the sugar value chain, the Department had to ensure that the underutilised hectares were used by planting more sugar. The challenges were around land claims in those areas. For the wine value chain, the target was that the 99 463 hectares under vineyard production could be increased by adding an additional 4 707 hectares by 2019. This would contribute to growing the GDP, from R30 billion to R32 billion by 2019. The challenges faced in the sector were more trade related, but the sector was also the least transformed.
If inroads were to be made and structures developed, then there was a need for technology development and innovation. The agenda of research, innovation and technology development had to be elevated, otherwise it would not be possible to improve the gains despite the other investments made in other areas. At the moment, less than 0.1 percent of agriculture’s GDP was invested in research and development annually. This would have to grow through improved governance. The challenge was that the current investment was very low, and it had to grow to two or three percent.
The current capacity in terms of human resources and expertise was limited. The infrastructure in the sectors was also inadequate and needed to be improved, and there was an ageing human capacity. A cost benefit analysis in the area was being worked on to ensure that the time and investment was being grown by two to three percent. There were a few projects led by the Department of Science and Technology to address the challenges in this very important supportive part of growing the agriculture value chains.
The last area dealt with issues of market access and trade. There was a need to increase the market access for agriculture, forestry and fisheries both nationally and internationally. There was also a need to increase export trade and reduce imports consistently. The other catalytic effect would be ensured growth in participation of small, medium and micro enterprises (SMMEs) and smallholders throughout the value chain. The target was to ensure that there were 200 Good Agricultural Practices (GAP) certified smallholders. The Department was working with the Perishable Products Export Control Board (PPECB) to enhance the capacity. Progress made so far was that farms had been identified for audits and SA GAP certification. Negotiations had also been initiated with one of the colleges that would work with the PPECB to provide the training that was required. Part of it would require improved record keeping.
The challenge that had to be overcome was to ensure that local procurement that was under the National Treasury and the Department of Small Business Development was speeded up and completed. The Department would ensure greater synergy between the Industrial Policy Action Plan (IPAP) and the Agricultural Policy Action Plan (APAP) around the commodities that would supply and support the agro-processes.
The Chairperson thanked DAFF for the presentation and invited the DRDLF to make a presentation.
The Chairperson added that when acronyms were used in the presentations there should be a footnote to explain the meaning of each and every acronym used.
DRDLR progress report on Agri-Parks
Ms Leona Archary, Deputy Director General: DRDLR said the presentation would give an indication of where the Department was in terms of the actual conceptualisation so that there was a common understanding even as the Agri-Parks were being rolled out. Issues of progress would also be dealt with and clarify where the DRDLR was in terms of the terminology used.
The concept of the Agri-Parks programme drew from existing models in the country, as well as the rest of the world. These included educational farms, experimental farms, collective farming, farm incubation projects, agri-clusters, eco villages, urban-edge allotments and market gardens. This was important, because it had been found that in the country there were various definitions of what an Agri-Park would look like when it was completed. The DRDLR had looked at everything that existed and had tried to find a way for everything to fit into the process.
The proposed model would make use of both public and private land. This would also serve as a transition zone between urban and agricultural land uses. The naming of the concept as a Park was intended to convey the role that the Mega-Park would play, as open space preservation was dealt with. While the term suggested permanent land conservation and recreational use exemplified by the park, it would also evoke a traditional model of an agricultural business park or hub, where multiple tenants and owners operated under a common management structure. The Agri-Parks would also provide networks of contacts between producers’ markets and processors, as well as the physical infrastructure required for transforming the industry. Focus would be primarily on the processing of agricultural products but to a limited extent opportunities would also be given to other types of industries to exist. At the moment, the focus was on agriculture and the linkage with surrounding agricultural land that would be utilised for production. The approach would include the selection and training of smallholder farmers as well as selecting farms per province for placement, incubation and training of unemployed graduates and agro-entrepreneurs.
The Agri-Parks would be farmer-controlled and the Department was currently working on this in terms of defining how farmer control would occur. This would link to the Land Reform Programme through bringing sustainability within the programme, to increase production in all of the activities currently happening in the rural space. The model would have a strong social mobilisation component so that black farmers and agri-business entrepreneurs were mobilised and organised to support this particular initiative. A critical component would be the partnerships, not only with government but with the private sector as well, and with all three spheres of government working together to make the initiative work.
The DRDLR would also be focusing on utilising the state land already in possession for production and processing sites. For that purpose, the 25 farms per province would be linked directly to this particular programme in terms of state farms, as well as the Animal and Veld Management Programme.
Ms Archary said guiding principles had been set out and were utilised to assess the business plans that were coming through. The guiding principles basically ensured that control remained with the farmers themselves. The essence of Agri-Parks was to bring land into production, but at the same time move in terms of production to the value add that was desired in terms of the processing component. The idea was also that the programme would provide support to growing towns and the revitalisation of rural towns through high economic growth, high population growth, etc.
When the DRDLR had started with the whole model of the Agri-Park programme, it had started with a mega Agri-Park followed by linkages to all the other things that would need to happen for it to work. Basically this meant understanding fully well that this was a matter of supply and demand and ensuring increased supply at the production level. In addition, account had to be taken of market access issues so that what was produced was found on the market both locally and internationally.
The Agri-Park development hub model was intended to have various activities around processing, adding other services around social services, retail services and so forth. The model was also beginning to show that linkages would be surrounding municipalities as well as the villages to ensure that production elements and other activities happened at a localised stage.
Levers were used to ensure strengthening of the current programmes of government. The internal levers used were the Animal and Veld Management Programmes (AVMP), the River Valley Catalytic Programme (RVCP), the Recapitalisation and Development Programme (RECAP), Restitution, Poverty, Land and Agrarian Studies (PLAS), the National Rural Youth Service Core Programme, and the Revitalisation of Rural Towns. Externally there was APAP which was aligned to CASP, Ilema-Letsema, Municipal Infrastructure Grant (MIG) funding, the Expanded Public Works Programme (EPWP), Community Works Programme (CWP), food banks and other programmes that might already exist within the DTI. The private sector was also utilised by using expertise that already existed in the commodity sector, such as cooperatives, markets and agri-businesses.
The strategic objectives of the Agri-Parks were the establishment of the parks in all districts of the country with the intention of contributing to the targets set out in the Medium Term Strategic Framework (MTSF) and the NDP. Agri-Parks would promote growth of the smallholder sector by contributing to the 300 000 new small-scale producers, as well as to the 145 000 new jobs in agro-processing by 2020. The DRDLR also wanted to promote skills and support to smallholder farmers and strengthen existing partnerships to ensure sustainability. In terms of how ownership of the actual components of the AgriParks would work, it was proposed that there should be an equity split, with 70 percent going to the producers and 30 percent to the state, and commercial interests holding minority shares in the 30 percent. The Department was currently working on the modelling of this with people who had expertise in the area on how the equity modelling would unfold. The work was expected to be completed in the next few weeks.
Smallholders would also be allowed to take full control of the park and steadily decrease state support over a period of ten years. The idea was for the state to support the initiative only over a period of ten years. Underutilised land would be brought into production and contribute to the NDP in total.
The Agri-Parks were made not to be just one particular site in a particular district, but rather linking the site from the level of production and moving up to the level of processing, to the level of market access. The Department was suggesting that the Agri-Park would be an innovative system of agro-production, processing, logistics, marketing, and training and extension services. There would be three components, the first component being the Farmer Production Support Unit (FPSU), which would have a rural outreach unit connected with the Agri hub itself. The FPSU would do primary collection, some storage, some processing for the local market and extension services, including mechanisation. The second component was the Agri Hub Unit, which was where key processing would happen. Agri hubs would also do other activities, including packaging, logistics and training. The Department believed that training, research and development and the use of new technology was going to be critical for the sustainability of the Agri-Parks programme. The third component was linking the Rural Urban Market Centre (RUMC) unit, which had three main purposes. The first was to link the rural and urban areas in terms of market access, both locally and internationally. The second purpose was to act as a holding facility, and lastly to provide market intelligence which was critical, as it would enable producers to ensure that even on the urban edge the Agri-Parks would still be able to find a space, even at a retail level.
Ms Archary presented a diagrammatic representation which showed the linkages where the Agri-Park model began to talk to both commercial farmers on the one hand and the smallholder farmers on the other. This was not just a model or programme that could benefit only land reform farmers or other smallholder farmers in communal areas, but should benefit all farmers within a particular space. Even in the light of the different support components, the level of FPSU might be used more by smallholder farmers, cooperatives and communal farmers. The commercial farmers might actually find themselves going directly to the Agri Hub component, where major processing could happen. The RUMC would then help in terms of market access to link all the farmers in that particular area. There was an obvious linkage to the market, which was the demand component that had been referred to.
The stakeholders in the Agri-Parks at the farmer level were commonage farmers, traditional area farmers, smallholder farmers and commercial farmers. All these were supported at different levels by the FPSU, the Agri-Hub component of the Agri-Park, and then by RUMC that was being proposed. There were slides in the presentation which showed what might emerge in districts because of the way the Agri-Parks were being modelled and because of wanting to get as close as possible to the farmers.
More than one FPSU might emerge and some of them already existed, so it was about the Department confirming the existence, and also that the services provided were adequate or expanded where they were needed most at the local level. These would have to provide extension services, doing some level of processing such as smaller milling for household consumption, and being able to give the farmers some market information at that level. These would then be linked to one Agri-Hub in a district. The Agri-Hub talked about should have major processing facilities, retail facilities, demonstration farms and housing to accommodate workers at the Agri-Hubs themselves, but also accommodation for those who came for training at the facilities. All these would be supported by an RUMC, which did not have to be one per district. For instance, the Luba trade park in KwaZulu-Natal could be an example of an area that could be used at that RUMC, with expansion in terms of specific needs for the rural producers.
The static model in terms of how the Agri-Park was seen emerging and its catchment area in terms of the Agri-Parks itself, showed it would be able to support more than one FPSU. These would then link the producers to the RUMC. The model showed there could be a far wider reach, even though it was placed in one central point in a particular district.
The FPSU would consist of an agriculture extension support office, local mechanisation, primary collection, sorting and smaller storage facilities, among other things. Agri-Hubs would become a key part of processing that was to be brought into the district. There would be a retail facility, an administrative facility, machinery and mechanisation support, packaging, quality control, agro-processing, a training centre, research and demonstrations, student and staff housing, etc. There would be the necessary processing and storage depending on the commodity produced. These could be silos, red meat or poultry abattoirs, and the necessary packaging to take the produce where it was required. Issues to be considered in the Agri-Park were the catchment area, the type of farmer, its density and how it would impact the Agri-Park network. The Department had tried to put as much information into the park so that linkages could be seen at the most localised level.
If the linkages to RUMC were done in the manner proposed by the Department, the catchment areas would overlap across the country and would ensure full production over future years. The project would be carried out in phases over the next five to ten years in order to get to the point of full coverage. In terms of the catchment areas, the DRDLR was proposing that for the FPSU, which would be at the most localised level -- where there was low density in terms of farmers -- a catchment area of 30 kilometres was suggested. Where there was a higher density of farmers, the catchment area would be ten kilometres. For the Agri-Hubs, the Department was suggesting a 120 kilometre radius for low density and a 60 kilometre radius where there was high farmer density. The RUMC would be at a 250 kilometre radius where there was low farmer density, and 150 kilometre radius for high farmer density.
Ms Archary said since the Department had started working on the Agri-Parks project, it had been working on a high level project programme. Some areas had been completed and some work was on track and the Department was well within the particular programme that had been tabled originally.
Slide 35 of the presentation indicated areas that had been confirmed. The programme had initially started in 27 districts and had then proceeded to all 44 districts of the country. So far 39 sites had been confirmed across the entire country in terms of the Agri-Parks themselves. The provincial Departments of Agriculture were the lead partners in terms of site identification, as well with the district. The North West Province was one of the provinces that were far ahead with the programme.
Slide 36 mapped out the proposed sites that had been selected and it was believed that these would become the core in terms of the Agri-Hubs component of the Agri-Park itself. The site would then be linked to the most localised level, as close as possible to the farmer in terms of the FPSU.
In terms of the budget allocation, DRDLR had already committed R2 billion for the current financial year, which would be utilised in all of the 44 districts as it drove the Agri-Parks roll out. The money would be used differently, depending on the phases of the project as they emerged in the business plans of each district. Some of the money would be used for infrastructure and others on the production element, which would become crucial if the programme was to become a success. The Department was in the process of finalising the budgets, and the budget component of the programme would be completed at the end of the month. The budget commitments would be from other departments, as well as provincial governments and the private sector. The budget had two sections -- the first was on production, and the other on the Agri-Parks themselves.
Slides 39 to 40 showed what was being used as a poster/flier, so that everyone would know where they were supposed to be in a particular month. In the month of June, the Department was busy with consultations, which had actually started much earlier in the process. The Department was consulting with farmers, communities, the private sector and other sector departments in terms of the modelling that had been put on the table. It was now busy with the farm assessments so that it could develop with DAFF the detailed production plan for each identified area. The intention was not to miss the current planting season while still working on the designs and infrastructure build of the Agri-Parks component. If done this way, the programme should be on the ground in September as far as either production or actual processing was concerned.
The Department was doing several things to check the readiness of each particular province, looking at different areas from site identification, consultations, farmer mobilisation, and production plans up to the point of being on the ground in terms of construction and actual implementation. This was included because it was a dashboard that the Department was using for monitoring what was happening in each of the districts. The Free State planning progress had been included in the presentation to show how they had utilised the Department's proposal and matched it to the identified Agri-Parks sites in the province. The Free State was advanced even in identifying the commodities that were being produced in the surrounding areas. The province was able to show how it was linking on the model -- for instance, from the central point to where the farmers existed in particular areas. The maps also showed the Agri-Hubs and the linkages to where the farmers existed within the catchment areas.
There were also examples showing where the livestock were and how they could be used in terms of the red meat component of the Agri-Park itself. The examples had been inserted just to show Members the readiness of the provinces themselves. The Free State example showed how it had conceptualised farm inputs right up to the retail stage and the value chains that would be worked on in the Agri-Parks.
An example from the Xhariep showed how the Municipality had already mapped where each farmer existed surrounding the Agri-Park, and what commodity was being produced at the moment. Therefore looking at the Xhariep Agri-Park, it was already known what type of farmers existed -- red meat farmers, ostrich farmers, wool production, fish projects -- and these were the types of processing that would happen in the actual Agri-Hub component of the model.
In Springbokpan in the North West, work was also at an advanced level. There were recently renovated silos in that particular area which had been used as a catalyst for their project. The silos had already been matched with willing components, as well as other areas that might be found within an Agri-Park. Surrounding farmers had already been determined in the area and 20 000 hectares of land had already been put under production to support the silos and milling operations, as well as the expansion of the full design of all the other components. There was also another example to show that Springbokpan was one of the areas which was far advanced. Construction was already on site, including a partnership that had already emerged through private sector funding.
Springbokpan had also moved in terms of unpacking their production, processing stages and market stages. What was shown in the pictures was what was actually happening on the ground for the North West. The provincial Departments of Agriculture, Environment and Rural Development, had committed R140 million for the current financial year and the DRDLR had committed R45 million. There was also an additional funding of R45 million as well as private sector funding and partnerships that had already emerged with Omnia for production support as well as tractors that would be used. A fully costed model of the Agri-Parks for the next few years had already been done and it amounted to R464 million.
Provincial consultations had been concluded but the Department was still busy in the Western Cape because they had brought in late in terms of the number of districts. One site had already been confirmed and there were three districts which had to be concluded. Governance structures had been established at a multi-disciplinary special task team level, was chaired by the Department's Director General (DG) and comprised of DGs of the DAFF, DTI, the Departments of Water and Sanitation, Science and Technology, and Small Business Development, the head of Provincial Agriculture and municipal managers, as well as the nominated DDGs from the respective departments. The Department had also aligned the programme closely with the outcome seven programme so that it was able to feed in at all levels in terms of the work that was being done.
Provincial multi-disciplinary task teams had also been established, which were chaired by the head of department of Provincial Agriculture and supported by DRDLR and other relevant Provincial departments. It included the middle management service (MMS) and other officials from the Provincial DAFF and DRDLR. At an operational level, there was an operations management task team that met on a weekly basis both at the Province as well as at national level. At the moment, project teams were being established for each district as the actual business plans were rolled out. The operation task team at the Department was chaired by the DDG and included the DAFF, and all the programmes within the Department and additional departments were being brought into the structure.
Currently the Department was busy with the state of readiness of all the business plans that had been tabled. It was moving on to identify the actual projects that would be done by doing infrastructure assessments and identifying the projects themselves with a detailed costing. It was also working on finalising the structure of the Agri-Park itself and the production plan so as not to miss the current planting season.
The Chairperson asked if the Department could highlight the government structures. There was the Comprehensive Rural Development Plan (CRDP) which was called the council of stakeholders, now there was Agri-Parks, and other Committees were being established. How were the Committees going to be aligned to work together to avoid duplication? Had the Department done enough in consultation with smallholder farmers from the foundation phase, as to where the Agri-Parks would be established? Monitoring of the effective implementation of the plan, as presented, seemed to be a problem.
Mr T Mhlongo (DA) asked about the budget versus the strategy and how the challenge of access to markets was going to be addressed. Had a feasibility study been done? Had the working model been compared to the other international models that the Department had reviewed? He was concerned with the challenge of coordination, as both departments were involved. There was the CRDP which had also had a lack of coordination -- how were Members going to be convinced that this would be a success, as there had been problems before? What was the difference between the CRDP and the Agri-Parks?
Hr asked for more details on monitoring. The Department had talked about the involvement of locals --were municipalities involved? Would the private sector be involved?
Mr A Madella (ANC) said the presentation was very insightful and gave Members the background to go forward in terms of changing the landscape of agriculture in the rural areas. He was compelled to raise the question around the Western Cape, as it was an integral part of South Africa, but there seemed to be some kind of hesitation in the Western Cape. He asked about the Department's ability to accelerate the process as only one site had been identified and three other sites still needed to be identified. Where was the site that had been identified? When would the site identification process be finalised? An issue had been raised about the structures, which in many ways were comprised of the same stakeholders. He wished to add the issue of District Land Committees, which were in the process of being launched nationwide, and asked how they would be involved in the process, particularly at the municipal level. For example, it was common for the same person from a municipality to be sitting in all the structures. To what extent were the local communities being canvassed, informed or consulted on this? Were they looking forward to the Agri-Parks as something that would change their lives?
Mr M Filtane (UDM) said the programme sounded quite exciting and he hoped it would be a game changer in the context of food security. Once it was in full production -- probably in the next year or so -- how many types of food would be produced? In South Africa, a large percentage of the food was produced by commercial farmers, and he believed this had to be changed sooner rather than later. Based on his experience of working with communities, he knew there was a tendency for communities to start expecting a stipend from government whenever the government brought a project to the area. Communities felt they had to be compensated for working on those mealie fields. Had the Department made provision for that, because it would surely come across that situation?
Mr Filtane asked if soil tests had been done to ascertain suitability and availability because there would be a centre for processing, but he assumed that the produce would be coming from different parts of a given district. He asked about ownership, as the Department had spoken about owner-controlled Agri-Parks, which had been broken down to 70 percent and 30 percent by the state. If stakeholder A owned the land but did not produce, and if stakeholder C actually processed, they would all be stakeholders in the programme. How would stakeholder A, who owned the land be handled, and how would stakeholder C be handled? Would they all have ownership in the programme and if not, how would their expectations and aspirations be handled? Why did the state want to have a stake at all? How would this be treated, or how would government’s stake be weaned down, if at all?
Mr T Walters (DA) felt the joint Committee meeting was a good concept. One of the gaps in the presentation related to value chains. He could see the advantages and everything, and asked if a market had already been determined on which to base the approach. There was no point making the land productive if there was no market. Two points related to the wine and sugar export markets, was how the market was determined or how the Department did an industry analysis for the interventions to take place. He thought this would differ from area to area and product type. How did the Department go about beneficiary selection? Much as there were other social priorities, the ultimate objective should be to favour emerging farmers and change the ownership structure of land in South Africa. There should be successful farmers who were also agricultural entrepreneurs.
Over and above the funding model from the state providing a certain infrastructure, how would finance ultimately work once the state walked away? What type of financing model would be put in place? He felt the issue of financing also related to land ownership. The Chairperson had talked about the alignment of different structures, like district committees and Agri-Parks, but also the governance part. It was one thing to say the stakeholders were there, but that in itself did not guarantee good governance of this particular model going forward. How did the Department intend to deal with that? When government walked away from the programme, how would the governance model work to ensure that it continued working well?
Mr Walters noted that distance had been used as a catchment guideline. Why was that an accurate system -- why not product type, or soil quality, or other types of guidelines?
Ms A Steyn (DA) felt the joint meeting was long overdue. She focused on the presentation by DAFF, because the presentation by DRDLR had contained a lot of detail without any specifics. The pictures were wonderful, but she could not tell how much of it was in the planning stage and how much was already on the ground. For that reason she could not ask questions on the rural development aspect of the presentation.
The challenges raised in the DAFF's presentation were also the challenges that she had in mind. She could not see this aspect in the DRDLR presentation, perhaps because each department had its own focus. She was concerned about the challenges on the agricultural side because they were what would challenge the whole plan. These were the challenges that people suffered on a daily basis in agriculture today. If the government could not fix the challenges, then agriculture would not thrive in South Africa. She mentioned a few challenges, one of which was policy certainty. There was a need to have policy certainty not only on land, but a on whole range of other issues.
She said input costs were a challenge, and recalled a Land Reform oversight to KZN, where all the farmers had informed the Committee that electricity was a problem. Farmers paid a lot of money in accessibility costs, which was just for an electrical line to the farm, and not for the actual electricity. These were the realistic issues that had to be talked about and if solutions could not be found, all the brilliant plans and wonderful ideas would end there.
She said she did not live far from Springfontein and passed it twice a week when travelling to and from Parliament. Technical capacity was an issue. She had started at the local council in Xhariep Municipality in the Eastern Cape, and the municipality had wanted to do all these things like the commodity value chains in ostrich farming, wool, and sheep, but could not because there was no water, and many other things which were not available.
Ms Steyn said the DAFF presentation had indicated that a prototype Agri-Park had been completed. She asked where it was and if the Committee could visit it. A challenge in acquiring land and property had been indicated, but why was this a challenge? If this was happening in the way that she thought it should be happening, it could be on any land and it could also be linked to cost. If someone wanted to build all this, would it be on state land and who would own it. She thought it was one of the problems that banks had, as they could not put millions of Rands into something that had no clear ownership. Who owned the land at the end of the day? All these things had to get in line.
The programme had a massive cost implication. She was not trying to shoot the programme down, but was trying to be realistic. She was a dreamer and wanted things to happen in South Africa -- that was why she was where she was. She had started to get these things going in her local municipality. She said that R2 billion was not going to kick start one thing, let alone in 44 districts. What would the R2 billion be used for? Was it going to be for the seeds for planting, or was it going to be for building silos -- what would be the first thing, as it was a chicken and egg situation. There could not be a silo without planting, and there could be no planting if there was no silo.
Mr E Nchabeleng (ANC) said the issue of cost would be a challenge. The provision of water or connection to a system would affect the budget. He agreed with Ms Steyn about the cost of electricity. He asked what the link was between the Agri-Parks and the revitalisation of irrigation schemes. Would the two be linked?
He had met some colleagues in the Eastern Cape who had raised issues about structures that had been revitalised some years ago. A lot of money had been invested in those structures, and they were not being used. Now something else was being talked about. How was it going to be linked to the revitalised irrigation schemes?
Some pieces of land had been given to communities through the restitution processes. Would these people be a part of this programme? If so, how would they fit in so that money was not spent in such a way that projects ended up linking? Many years ago, in the first administration, an RDP document had been produced which talked about building the economy, using local resources. The document had also talked about appropriate technologies, if one was living in an area where there was drought and serious water shortages. It would not make any sense to put an electric pump and drill a bore hole that would be dry within six months, but if a windmill was put up, water usage would be controlled and the cost would be very low. There would still be quality in what one was doing through proper planning. Agriculture had been done for thousands of years, even before electricity, and there were never problems with some of the things that always needed to have electricity connected. There were other methods for getting energy cost-effectively. Solar energy could also be used. If problems were driven by consultants it was because consultants would always cut a niche for themselves for the future -- and even created a market for their other products. He suggested going back to the drawing board and making reference to the appropriate technology.
Ms A Qikani (ANC) had a few questions about sites. In the Eastern Cape there were some sites that had been identified, particularly at Amathole in Butterworth. She asked if the municipality had been consulted during the identification of the sites. Butterworth was surrounded by chiefs, and she asked if consultations had been done and if the sites had already been identified. If so, where were the identified sites in Butterworth?
Ms N Magadla (ANC) said the Department had talked about private sector investment and growth. What was needed in the country was economic growth and jobs in both the rural and urban sectors. In the DRDLR presentation it had been indicated that R2 billion had been allocated by the Department. How much had been allocated by other departments and the private sector? There was a challenge of ageing senior researchers. Was there a layer of researchers to fill these vacancies?
Ms Z Jongbloed (DA) asked how Agri-Parks linked to the DTI's economic zones. From the presentation it seemed as though there had been wide consultations with just about everybody, including farmers. The presentation had also mentioned a multi-disciplinary task team. She asked if the Department could inform Members as to who exactly served on the task teams. It was quite disconcerting that so little mention had been made of the Western Cape, and she asked if the Department could perhaps explain what the plans for the Western Cape were.
Mr C Maxegwana (ANC) commented that if the Department had decided to take the route of rapid rural transformation, there was a need to come up with ideas to ensure that transformation occurred, and this was in the hands of the two or three departments. The DAFF and DRDLR could not do much without water, and therefore some working arrangement in terms of that had to be done by the government. He made the comment, because the Agri-Parks was a serious decision taken by the government. If mistakes committed in the past were to be corrected, as raised by other Members, what was needed was to ensure effective monitoring. The good ideas had to be followed through or implemented through monitoring. The funding allocated would have to be closely monitored in each of the Provinces.
The DAFF had said it would provide support services and marketing agencies. How would this be done? How were small and rural towns going to fit into this? How was DAFF going to assist those smallholder farmers to ensure that things were happening, as there were problems there. It was said that 36 of the 44 districts had confirmed sites -- which districts were they?
Mr P Mnguni (ANC) wished there was more time, or perhaps a workshop, to address all the issues that Members still had, to ensure that what was being discussed as the programme moved forward was scientifically correct. He appreciated the format of the presentation from DAFF that focused on decisions, targets, activities, challenges and recommendations, which was very close to the Public Finance Management Act (PFMA). The Department had talked about strategic goals, targets, activities and so forth so that it could easily be held accountable. The Department had been creative about it and had at least talked to the jargon of the PFMA and the format. He encouraged the DRDLR to do the same. Slides 17 to 22 of DAFF's presentation talked about a contribution to 1 million hectares of communal area, and he asked if the hectares were really in communal areas. For instance, in the Western Cape, were communities really nicely ploughing wheat and fruit, as the Department had talked about the strategic scope in communal areas.
On slide 41 of DRDLR's presentation, the only words on the slide were “planning progress per province,” and he had expected to see the progress reports of each province. What had followed was nothing close to that and the DDG in her presentation had given an example of the Free State. The Department was representing the whole of South Africa, but the presentation had ended up being an example of the Free State. In the documentation, it was really the Free State, and there might have been slides about the Eastern Cape as well. He asked if the Free State was the leading province in terms of implementation of Agri-Park, or was it the average one? Was the Free State the lowest performing and therefore the Department was driving the provinces from behind from the lowest performance? If not, should the Department be held accountable to give details per province within seven days?
The Chairperson asked the Department to respond to the questions raised by members.
Mr Mduduzi Shabane, Director General, DRDLR, said the presentations by the two departments formed part of the nine Presidential interventions in the State of the Nation Address (SONA) aimed at revitalising agriculture and the agro-processing value chain. The two were complementary and were no longer problems of the DRDLR and DAFF. The two issues were monitored at a cluster level at the level of the DG, and were also monitored at the level of Ministers in the economic sectors, employment and infrastructure development cluster. There was high level political oversight across all the nine programmes. Each of the nine priority interventions was led by a Minister with a group of Deputy Ministers from various sector departments. For instance, in the case of revitalising the agriculture and agro-processing value chain, it was led by the Minister of Agriculture Forestry and Fisheries. The priority intervention of rural development through Agri-Parks and the speeding up of land reform played a critical role. The Department of Water Affairs and Sanitation sat on the teams that oversaw the programmes so that when a question of water availability arose, it was part of the team. He was illustrating the point that it was not just DAFF and DRDLR that were sitting and working.
The issue of monitoring and evaluation had been raised. At the Director General cluster level, there was a project management unit that had been set up, led by the Department of Science and Technology, the DRDLR and the DTI. These were the departments that were overseeing the tracking of each one of the nine priorities, including the one on agriculture and agro-processing. The DTI was centrally involved. The issues of market and trade analysis came from the DTI, but part of the market analysis was done by the DAFF through its agency, the National Agriculture Marketing Council. One of the things that the agency had been asked to analyse was government procurement of food and food related stuffs. It had been established that there was a lot of money being spent by government, whether procuring food for hospitals, schools, prisons, and the Defence Force, and some of the food that was procured by the state was imported. There was no challenge of a market, but the government had to guarantee that through Agri-Parks and through APAP, there was security of supply. For instance, if service providers were contracted to supply food to prisons, Correctional Services could not be asked to cancel the contract that the Agri-Parks would supply when there was no capacity. The same would apply to health, or the defence force. The DG of DRDLR had already personally spoken to all the heads of those institutions. On the demand side there was no problem, but what had to be guaranteed was the provision of products.
Mr Shabane said recently there had been contributions from colleagues in the DTI, which would be making a financial contribution in this particular space. The Department of Transport (DoT) and the Department of Public Works (DPW) had been added to the product team because some of the infrastructure would require the two departments and their agencies to fix some of the infrastructure. For instance, the DoT was critical because of some of the agencies that the Department managed. Some of the rail infrastructure that was in a state of decay might need to be revitalised to move goods from where they were produced to the market.
The team at the level of DGs, Department of Water, DoT, the Department of Public Enterprises, Department of Science and Technology and Department of Postal Services and Telecommunication (in so far as broadband was concerned), had been asked to develop a cross-cutting plan in support of each one of the nine-point plans. He felt it was important to give a broad overview of the different role players.
The high level technical government structure of Directors General, heads of Departments of Agriculture and Rural Development in the provinces, and municipal managers met every month. At the last meeting, the state of readiness of each one of the districts had been assessed. This was where it had been determined who needed what assistance, and those who lacked technical capacity had indicated so. In fact, six provinces had requested the national Department to dispatch a team with technical expertise to help finalise planning, in order to be at the same level as the North West and the Free State. The Department was not saying by any means that its governance framework was enough. This was an uncharted territory which had never been embarked on. A number of mistakes might be made, but lessons would have to be learnt as the programme moved along. The Department would not wait for a perfect blueprint and a silver bullet for every problem encountered. Ways to resolve the problems would have to be found.
Members were spot on about the cost. The programme would depend entirely on the fiscus, or the allocation of government funding. The DDG had shown an organogram which showed that the private sector would play a big role.
Mr Shabane added that he had responded to the questions on alignment of structure, monitoring and evaluation. One of the things asked of all the provinces was for all three spheres of government to consult thoroughly amongst themselves. When all was said and done, the Department could not plan on behalf of the farmers. There should be a massive drive to start mobilising farmers. Each province was at different levels of farmer mobilisation. The Eastern Cape was far ahead in terms of talking to the farmers. However not all the sites were confirmed in the Eastern Cape, because government was proposing certain sites and the farmers were proposing different ones. This was the kind of consultation that was happening. In Limpopo, there was a data base of the farmers that had been engaged. Consultation with farmers was on-going.
Ms Archary added that in terms of linkages to other structures, there was phase two and three of CRDP which dealt with enterprise development, village industry development and rural industrialisation. The Agri-Parks programme was not moving away from that and would obviously still be aligned to existing structures. The ones being talked about by the Department was really ensuring at the implementation level there were structures which supported the government framework of the RDP management system. It was really about strengthening that.
The question about consultation had been answered by the DG. The Department was now going into detail farm by farm, making assessments of all of the areas surrounding the Agri-Parks. There were detailed plans coming from the provinces for consultations with farmers as well as traditional communities. At the provincial level, consultation had taken place between farmer organisations, different commodity sectors and so forth.
She clarified that in the Western Cape, consultation was not finished. In other provinces, consultations had been done, and that was why the numbers were not adding up. There were still about three sites which still had to be confirmed, even in those Provinces where consultations had happened. In the Western Cape, provincial consultations were yet to be held, and were scheduled for 30 June. It was not that the province did not want to participate, but there was a need to understand that the Western Cape as a whole had come on late. Originally the 27 districts had not found their space in the Western Cape. It was not that the Western Cape did not want to participate.
It had been indicated that by the end of next week the Department would be able to confirm the funding that would be available across all the sector departments. Indeed, R2 billion would not be sufficient to drive the programme to its desired level. The R 2billion only came from DRDLR, but there would also be money coming from all sector departments in the space. The Department acknowledged the lack of sufficient money and was working to ensure there were clear projections and clear cash flows for that funding. This was not a one-year budget allocation, it was a long term programme, at least over the next MTSF, and the R2 billion had been confirmed by DRDLR to go into the programme every year. The Department was expecting other departments to do similar kinds of things in terms of the work that they would be doing.
In response to how the Department came up with its particular model of an Agri-Park, Ms Archary said it had done a significant amount of research. It had looked at work that had been done in other countries, such as India, Brazil, Mexico, the Netherlands, Kenya, and some other areas in Africa. There were about seven or eight different countries that had been looked at before the Department had come up with the model. It had not just taken something that came from somewhere and applied it to the South African context. The Department had also looked at models that were being implemented by the provinces. Many provinces had what was being referred to as Agri Villages, Agri Hubs, the market areas created, the fresh produce market, etc., and tried to find a way to link all of them together in terms of the concept of the modelling that was now being put on the table. As indicated by the DG, the programme was indeed work where the Department would be learning as the programme moved along, and the model was not a fixed model, so that nothing else would be taken into consideration. It was not that the model would be found on the ground already. When the department said “prototypical,” it wanted to give guidance to provinces even as they were trying to do it. The work that had already been completed was a prototypical design of how an Agri-Park would look, with guidelines and criteria for evaluation in terms of the sites that had been chosen. A lot of work had already been done around the analysis in the last year, when the Department had worked with a team of experts from the DAFF in terms of determination of commodities, current infrastructure that existed in the area, what soil tests had already been done and what could be blown away. All this had been used to come up with the model.
When the Department had said the corporate structure of the Agri-Parks was farmer controlled, it meant the Department was at the moment busy working on packaging it. It was using the guideline of the 70-30 ratio, and it did not mean that the state would have to own that 30 percent. The idea was that the state would actually withdraw over time from this particular programme and it would be controlled by farmers and the private sector. One of the aims was to ensure private sector investment into that space, and into the hub itself. What was on the table right now was a broad guideline, and the Department had the next two weeks to finalise the way in which the corporate structure would actually work. The issues raised by Members of “who” and “how” was what the Department was trying to unpack so that a workable model was put down for the farmers, but also to bring in the necessary required investment.
The detailed costing of everything in terms of the buildings and infrastructure would be determined business plan by business plan. The Department was currently busy with full feasibility studies and business planning with each of the district municipalities. As indicated by the DG, where there was no technical capacity, the Department was making provisions for that technical capacity with the money that had already been allocated for that particular purpose.
Regarding the use of appropriate technology, Ms Archary reminded Members that during the presentation she had emphasised that the model would not be able to work if constant research, innovation and the use of new technology was not ensured. Sustainability would be built on the way in which new technology was used for improved production at the levels of the farmers themselves, but also improvement in the processing aspect. This was an idea around the Agri-Hub itself, and a component referred to as a demonstration farm had been included. There would be a research and development component at that level, and the department would be working with the DST and Council for Scientific and Industrial Research (CSIR) to determine how this would unfold. The Department agreed there would be a need to bring in appropriate technology in each of those areas. Where there was no water, the Department would have to ensure that there was water, either by finding alternative ways of farming, or sources of water, and using new technology.
All sites had been identified in consultation with the district municipalities and the local municipalities. It was not the Department which had identified the sites. This had been done by the provinces during the consultation process. In Amathole, that was the process that had been followed. In Butterworth, the focus had been around the red meat industry, so the actual site was going to revolve around the Butterworth abattoir and expand outwards into the livestock production in the area. Even if a site had been identified, it still had to go against the testing that had now been put into place. A site was not chosen for the sake of being chosen, but had to meet the required criteria in terms of sustainability, otherwise the programme would become a white elephant.
She apologised that it was not possible to put down every planning progress detail of every Province. The Department had a detailed schedule for each province, and these would be submitted to Members. As far as progress was concerned, the North West was far advanced at the moment. Production areas had already been identified. The Free State followed closely in terms of progress, and that was why the Department could give the Committee progress on every single site. It was hoped that by September, at the levels of production, everyone would have areas identified and funds would have been dispersed for the production element to begin. The work would run in parallel, to catch the current production season.
Mr Shabane added that the Department was busy setting up District Land Reform committees. The committees would be the primary drivers of the selection process of farmers. The farmers were smallholder farmers, and not community. Selection criteria had been set out and a category of people that were targeted had been identified. For instance, there were one million smallholder farmers who were farming in the former homelands, and these were some of the targeted farmers. The District Land Reform committees would be the instruments the state would use to select beneficiaries, and identify the land that was appropriate for that particular area to create jobs.
In terms of challenges, in as much as APAP and the NDP set a target of one million jobs, planning indicated the commodities that were the winners to create a certain number of jobs -- for instance, jobs per hectare per commodity in a particular area. Input costs had been deliberately singled out, and energy and water had been identified as challenges. Feed and fertiliser had also been identified as a challenge, as had hatcheries and nurseries. Therefore the APAP had to come up with ways to resolve this, as there were monopolies controlling those particular areas. There were monopolies controlling the fertiliser industry and entering the space was a challenge. The government, using levers such as policies and legislation, could break those monopolies so that people could have access to more affordable inputs, such as fertiliser and energy. Unless the monopolies around those areas were broken, the plans would not progress.
In terms of expectation, the DG said he had met a number of farmers on Saturday. Some were keeping up to 1 000 chickens, others up to two million chickens. Some of them had asked questions about the budget, and had indicated it was too little. The Department was of the view that the industry could not be transformed through government grants. It would have to be very stringent in the selection criteria. Some people would be given grants, but if farmers wanted to operate at a different level and wanted to grow as farmers, they should be prepared to take some risks and bring equity to the table. The programme was not entirely driven through government handouts -- there was an equity element that had to come from the farmers. Government could not do it alone and the expectation that there would be stipends would not be met, as the Department could not give farmers stipends. The government could not put R2 billion on the table, provide land and have farmers still expecting a stipend from the government.
Mr Mannya said that Agri-Parks should be seen as a strategic intervention to maximise the existing potential of certain initiatives by closing gaps and aggregating all the efforts to make the most of it. The smallholder farmer was the key target or beneficiary of the programme. It was expected that smallholder farmers would benefit the most from the programme, and the design was exactly meant for that.
The DAFF already had farmer support centres or agriculture extension officers in the provinces. The intention was to look at how support could be brought a step closer to the farmer support centres. It was possible that over time some offices would be moved to the farmer support centres.
In terms of poultry in Lebowakgomo, the abattoir was developed and capacity had been increased to slaughtering 20 000 birds a day. Broiler poultry houses had been developed around the abattoir to supply the abattoir. Unfortunately, the abattoir had not been brought into operation, but the situation had already been corrected to find an operator. The operator would ensure that the broiler houses to supply the abattoirs were activated.
In terms of research capacity, there was some indication of what the DAFF, Department of Science and Technology, and the Agricultural Research Council was doing to build that capacity over time. There were a number of partnerships, including international partnerships, to grow capacity and bring young scientists into various programmes to reach that capacity before losing the senior scientists.
The training provided within the agricultural education training strategy was intended to ensure that the training provided was accredited training. Figures had been provided in one of the tables, but the intention was to add to the existing number of training institutes of agriculture training centres, including the colleges.
Mr Mannya said that on the whole, the Department had read capability maps and in some cases suitability maps. Therefore as the sites were being selected, land capability and suitability would be taken into consideration. For various specific sites where production happened, soil tests would be undertaken. However it would be already known that in that area, in terms of agro-ecology, the land would be suitable for particular commodities. There were maps available for the identified commodities in Agri-Parks for each province in terms of what was suitable for what.
In terms of the catchment guidelines being based on kilometres, they were actually based on the density of farmers within a particular space. The kilometre was a guideline, but the main focus was around the density.
Incorporation of all current types of projects, whether land acquisition or restitution, the idea was that the Department would be working in terms of ensuring that the existing projects also began to produce at the correct level. The projects would begin to support the processing component of the AgriParks. It was about bringing into production the communal areas, current land reform farmers and traditional communities within that economic area, as well as the inclusion of private sector farmers in the agro-processing part of it.
The Chairperson thanked the departments for the responses. She said there was an outstanding question on the composition of the Multi-Disciplinary Committee, and also the role of the Department of Environmental Affairs.
Ms Archary responded that the DG had explained the Multi-Disciplinary Committee special task team composition in terms of all the different DGs. When sending the other information, the Department would also send the information of details in terms of the composition. The Department of Environment was also part of that task team, both in the Multi-Disciplinary Task Team and also at the cluster level. The Department would not be able to move in respect of all the environmental regulations that had to be dealt with, and the Department of Environmental Affairs was a critical partner in that particular process for the environmental impact assessments (EIAs) and all other environmental issues.
Mr Mannya said that in the NDP there was an indication that the new areas under irrigation could be increased. Before this could happen, water had to be released in addition to the newly revitalised land that had been developed. The revitalised irrigation schemes were being taken into consideration.
The investment in the Lebowakgomo project, which included the broiler and the abattoir, was in the vicinity of R6 million in respect of the houses that would be developed with the revitalisation of the abattoirs.
Ms M Semenya (ANC), Chairperson of the Portfolio Committee on Agriculture, Forestry and Fisheries, said the presentations from the two departments should be welcomed as a work-in-progress. This should not be the end of the interaction as a joint Committee. Another meeting should be held to follow up on the many questions, some of which had been raised by Members on the agricultural side, that referred to challenges that could affect the Agri-Parks if not addressed. Agriculture revitalisation and value chain adding was part of the nine plans, and Cabinet had approved the Agriculture Action Policy Plan which guided how agriculture would be revitalised throughout the country. The DRDLR had come up with a rural economic boost in the rural areas.
The Department's role should be on how to deal with the shortcomings of not having Animal Health practitioners. To succeed in red meat, veterinarians were needed to lead the Animal Health practitioners. As agriculture was being revitalised, the question would be how the Department would close the gap in human resources, as scientists were being lost. Practitioners were ageing, but there was no evident recruitment happening. This particular aspect was not clear, even in the DAFF's action plan. She suggested the Committees should have another meeting and follow up as Members went to their respective constituencies to visit the sites.
She advised the DG that as the programme had been presented to Cabinet and adopted, if provinces and municipalities did not adopt the programme as provincial and municipal programmes, there would be problems. Consultations should lead to provinces and municipalities adopting the programme so there would not be problems in implementation.
Mr Mcebisi Skwatsha Deputy Minister of Rural Development and Land Reform thanked the Chairperson. He said the comments made were highly appreciated. The national office could only set up the criteria to implement the plan. The Department would continue to work on the comments made. The ideas of the Department could not be fruitful without mass support.
The Chairperson said the Parliamentary session was for five years, and the Department would be submitting quarterly reports. If there was a need to call the Department it was the Committee's right to do so. It was not possible to exhaust all the issues in one day, and she asked Members to hold on to the issues.
The Committee Secretary informed members that the oversight plans for July 2015 had been approved.
The Chairperson concluded by saying that the project would be good if the plans were implemented effectively. The lives of smallholder farmers and the communities where the parks would be situated would be changed. Members had been informed about the role of the DAFF and DRDLR, as they were working jointly to ensure that the Agri-Parks were established and operational. It was the Committee's responsibility to do oversight of the plans that had been presented, to monitor their implementation. Members had made proposals on some issues, and she asked if the Department could take some of them into consideration and see if they could assist in improving the implementation of the Agri-Parks.
The Committee would continue having joint meetings with other departments and other Portfolio Committees because there were overlapping issues, like water and electricity, amongst others. This would not be the last meeting. If there was a need, perhaps the Committee could spend one or two days to deal with Agri-Parks. A detailed progress report on each and every province was expected. The consultations should continue and be finalised so that the programme could proceed with other processes to ensure that by the end of the 2015/2016 financial year, at least one or two Agri-Parks would be established and functional.
Consideration of minutes of 17 June 2015
Mr Filtane proposed adoption of the minutes.
Mr Madella seconded the adoption.
The meeting was adjourned.
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