Department of Agriculture, Forestry and Fisheries on 1 Quarter 2016/17 performance, with Minister in attendance

Agriculture, Forestry and Fisheries

13 September 2016
Chairperson: Ms M Semenya (ANC)
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Meeting Summary


The current drought was the worst since 1904 and had had a devastating effect on the sector and agricultural value chain. The Department of Agriculture, Forestry and Fisheries (DAFF) reported this when briefing the Portfolio Committee on its first quarter performance. About Forestry and Natural Resources Management (FNRM), TProvinces had used R188m from their equitable share to assist smallholders, and the DAFF had provided interim feed aid for the livestock of smallholders. R263m had been spent on drilling and equipping boreholes.

Domestic production of staple foods like maize and beans had been reduced by at least 30%, leading to price increases. About 189 750 livestock producers, including approximately 3,6 million livestock units, had also been affected by the drought. To mitigate the impact, just under R1.0 billion had been set aside to procure feed for livestock, establish fodder banks and drill boreholes.

The vacancy rate in the Department had increased from 10% to 10.4%, mainly due to budget constraints on the compensation of employees, delays as a result of grievances, as well as delays in the verification of citizenship and criminal checks by the State Security Agency. The plan to procure 32 light delivery vehicles (LDVs) as primary animal health care clinics was progressing well, although the project had been severely affected by budget cuts. It had received 124 applications from final-year veterinary students of the University of Pretoria who wished to participate in the 2017 Community Compulsory Service programme.

Prices for a basic food basket had increased by 16,4 %, from R516 to R601, between April 2015 and April 2016; by 16,0%, from R519 to R602, from May 2015 to May 2016; and by 15,6%, from R516 to R597, from June 2015 to June 2016. Three new cooperatives had been established, two to support collective marketing and bulk buying of inputs, and one to support access to processing facilities. Members of 18 existing cooperatives had been trained on the ‘FARMtogether’ programme and business planning guidelines.

Nine new business proposals to the value of R169m had been received for consideration, but only two had been submitted for due diligence assessment. The main challenge with the proposals was the status of the businesses requiring funding, because many of the proposals were for bail-out funds for bankrupt businesses, which was not the objective of the fund.

The DAFF said it had not met its target of finalising the permit conditions for the fishing rights allocated in nine commercial fishing sectors.  The Minister had agreed to a request from stakeholders to extend the period for the collection of application forms to allow potential applicants more time to complete them and collect the additional information that needed to be submitted.

Members wanted clarity on why the LDV programme on Animal Health Care had been severely affected by budget cuts; wanted to know if the DAFF had facilitated the transfer of R500m from the Industrial Development Corporation to the Land Bank for lending to all producers; asked the Department to clarify the 2016/17 planned deliverables on the programmes of the Office of the Director-General and Trade Promotion and Market Access, because they did not understand those areas; asked how many jobs had been created, because what had been presented in the document was not clear; wanted to establish if the employment equity figures presented by the Department were proportionate to the population of the country; and asked what the time frames for the completion of the borehole jobs were, and why the targets had not been met.

 

Meeting report

Briefing by Department of Agriculture, Forestry and Fisheries on 1st Quarter 2016/17 performance

Mr Joe Kgobokoe, Deputy Director-General: Policy, Planning, Monitoring and Evaluation: DAFF, focused his presentation on the six programmes of the Department: Administration, Agricultural Production, Health and Food Safety (APHFS), Food Security and Agrarian Reform (FSAR), Trade Promotion and Market Access (TPMA), Forestry and Natural Resources Management (FNRM), and Fisheries Management.

Regarding Human Resources, he reported that as at 30 June 2016 the post establishment of the Department totalled 6 198 posts. During the period under review, the vacancy rate of the Department had increased from 10% to 10.4%. During the period, eight employees had been appointed to the Senior Management Service (SMS) cadre. Fourteen SMS posts were advertised in the media, three SMS posts were short listed and three interviews were conducted, including the interview for the vacant position of Director-General, which took place on 6 May 2016. Cabinet had concurred with the appointment of the Director-General on 8 June 2016.

Challenges that had contributed to the increase in the vacancy rate were the budget constraint on the compensation of employees, the delays in the filling of vacancies as a result of grievances, as well as delays in the verification of citizenship and criminal checks by the State Security Agency (SSA). In terms of the national vetting strategy, it was a requirement that a candidate must be subjected to specific personnel suitability checks before an appointment can be made.

Concerning Agricultural Production, Health and Food Safety (APHFS), the animal improvement schemes for prioritised value chain commodities, the Kaonafatso ya Dikgomo and poultry schemes had been monitored. Over 50 poultry farmers had participated at the annual AVI-Africa Conference in Johannesburg. The memorandum of agreement (MoU) between the DAFF and the SA Poultry Association (SAPA) on the poultry scheme had been compiled.

124 applications had been received from final-year veterinary students at the University of Pretoria who wished to participate in the 2017 community compulsory service programme. In primary animal health care, the plan to procure 32 primary animal health care clinics was progressing well, although the project had been severely affected by budget cuts.

In terms of the national plan for the Conservation and Sustainable Use of Plant Genetic Resources, an inventory of the current status of national plant genetic resources had been developed, and a community-based conservation organisation for indigenous goats was established in Limpopo.

The monitoring of plant legislated certification and improvement schemes for prioritised value chain commodities had been focused on the seed and fruit schemes, with a total of 21 units being registered in Quarter1. These schemes were aimed at ensuring that farmers used good quality propagation material in support of increased production and productivity.

With regard to Food Security and Agrarian Reform (FSAR), PPrices for a basic food basket had increased by 16,4 %, from R516 to R601, between April 2015 and April 2016; by 16,0%, from R519 to R602, from May 2015 to May 2016; and by 15,6%, from R516 to R597, from June 2015 to June 2016 (National Agri-Marketing Association (NAMC) Food Price Monitor).

Draft, version 1, of the policy on comprehensive producer development support has been developed after consultation with the commodity associations.  37 of 120 targeted boreholes for drought relief had been drilled in North West Province.

The Comprehensive Agricultural Support Programme (

CASP) and Ilima/Letsema Quarter 4 performance review meeting for 2015/16 had been held with provinces from 11 to 13 May 2016 to validate reported information, and the report had since been submitted, as prescribed by the Division of Revenue Act (DORA).

The draft implementation guide for the deployment of extension practitioners had been developed and consulted with the provinces through the public sector forum for extension and advisory services. The national policy on extension and advisory services was tabled on 19 August 2016 at the Cabinet Committee on Economic Sectors, Employment and Infrastructure Development.

Following

On Trade Promotion and Market Access (TPMA), FollowingFF  the success of the enterprise and supplier development programme in connecting processors to retailers, Woolworths and the Industrial Development Corporation (IDC) had committed to support the establishment of a pets’ wet food manufacturing plant – Woolworths with a five-year off-take agreement worth R180m, and the IDC with a R35m loan for operational costs. The capital costs were under consideration through the Agri Black Economic Empowerment (BEE) Fund. This programme was also supported by the SA-Good Agricultural Practices (GAP), with the Perishable Products Export Control Board (PPECB) and the programme with the SA Bureau of Standards (SABS) to train processors in the Hazard Analysis and Critical Control Point (HACCP) certification system to control all potential hazards in the processing system. 

The marketing and agro-processing unit was supporting Agri-Parks and special economic zones, and an appraisal template had been developed in partnership with the dti and the Department of Rural Development and Land Reform (DRDLR) to evaluate the current status of Agri-Parks and future development opportunities.

Three new cooperatives had been established: two to support collective marketing and bulk buying of inputs, and the third to support access to processing facilities. Members of 18 existing cooperatives had been trained on the ‘FARMtogether’ programme and business planning guidelines.

The SA Customs Union (SACU) had reached an agreement on how trade agreements and negotiations with SACU must be conducted. The Tripartite Free Trade Area – the Common Market for Eastern and Southern Africa (COMESA), the Southern African Development Community (SADC) and the Eastern African Community (EAC) negotiations regarding outstanding matters on the Annexure relating to rules of origin, as well as product specific rules of origin, continued.

Nine new business proposals to the value of R169m had been received for consideration, but only two had been submitted for due diligence assessment. The main challenge with the proposals was the status of businesses requiring funding, as many proposals had been for bail-out funds for bankrupt businesses, which was not the objective of the fund.

About Forestry and Natural Resources Management (FNRM), TThe current drought was the worst since 1904, and had had a devastating effect on the sector and agricultural value chain. Provinces had used R188m from their equitable share to assist smallholders, and the DAFF had provided interim feed aid for the livestock of smallholders. R263m had been spent on drilling and equipping boreholes, using CASP and Ilima/Letsema funds.

Domestic production of staple foods like maize and beans had been reduced by at least 30%, leading to price increases. About 189 750 livestock producers, including approximately 3,6 million livestock units, had also been affected by the drought. To mitigate the impact of the drought, just under R1.0 billion had been set aside to procure feed for livestock, establish fodder banks and drill boreholes.

Service Level Agreement had been entered into with a private sector company on the Western Cape re-commissioning, and a land rights enquiry for communities in the Western Cape had been approved. It had commenced on 2 May 2016. 1 339 ha of agricultural land had been rehabilitated against an annual target of 16 000 ha. The bid for the procurement of seedlings for the Eastern Cape, KwaZulu-Natal, Limpopo and Mpumalanga had been finalised in preparation for the planting season in Quarter 3 and Quarter 4.

The Preservation and Development of Agricultural Land Framework (PDALF) Bill was to be presented at the National Economic Development and Labour Council (NEDLAC) on 19 July 2016. The Minister had instructed the Department to prioritise and fast-track the PDALF Bill for Cabinet consideration, as the sector was increasingly losing arable land to mining and human settlements, which may pose a serious threat to food security in the near future.

With regard to fisheries management, four Chinese vessels found in South Africa`s territorial waters without the necessary permits were arrested and successfully convicted in two separate incidents. One arrested vessel was taken to Cape Town and fined R70 000, while the three other vessels arrested outside East London were fined R700 000 collectively.

1 840 compliance and enforcement measures had been conducted in six prioritised fishery sectors, namely: hake, abalone, rock lobster, line fish, pelagics and squid. This had entailed 1 197 compliance inspections and 643 inspections by fisheries’ protection vessels.

The DAFF had not met its target of finalising the permit conditions for the fishing rights allocated in nine commercial fishing sectors.  The Minister had agreed to a request from stakeholders to extend the period for the collection of application forms to allow potential applicants more time to complete the application forms and collect the additional information that needed to be submitted as annexures. This had caused a delay in the allocation of rights, as well as the finalisation of permit conditions, in these sectors.

The DAFF has a fleet of seven vessels: five patrol vessels and two research vessels. This fleet was currently being managed by the South African Maritime Safety Association (SAMSA). All the vessels were active and at sea. The DAFF`s primary research vessel, the FRS Africana, had completed its sea trials and passed various certification requirements, enabling her to embark on her first survey since 2012.

The final small-scale fisheries regulations had been gazetted on 8 March 2016, along with the Marine Living Resources Act (MLRA) Amendment Bill signed by the President, and now provided the legal mechanism for the implementation of the small-scale fisheries policy.

Mr Jacob Hlatshwayo, Chief Financial Officer: DAFF, reported that the annual financial statements for 2015/16 had been submitted to National Treasury and the Auditor-General on 31 May 2016. The Auditor-General was currently busy with the annual audit of DAFF. The Micro Agricultural Financial Institutions of South Africa (MAFISA) had disbursed R2.9 million to 294 beneficiaries, and R4.98 million had been collected as MAFISA loan repayments. A total of 1 619 jobs had been created during Quarter 1. The DAFF revenue collected for services rendered and forestry products sold until 30 June 2016, had amounted to R48.9 million against R51.1 million for Quarter 1 of 2015/16. 92.5% of payments to suppliers were made within 30 days.

(Tables and graphs were shown to illustrate budget allocation and Quarter 1 expenditure per programme)

Discussion

Mr D Maloyi (ANC) said he had not been happy to receive documents from the Department very late. Members supposed to receive the report in time so that they could prepare thoroughly for the meeting and be able to look at the annual performance plans (APPs) agreed to by the Parliament. He wanted clarity on why the light delivery vehicle (LDV) programme on Animal Health Care had been severely affected by budget cuts. Had the DAFF facilitated the transfer of R500m from the IDC to the Land Bank for lending to all producers?

Mr Senzeni Zokwana, Minister of Agriculture, responded on the late report to Members, and admitted it was the responsibility of the Department. He made an assurance that it would not happen next time because if Members get them late, they would not be able to make a constructive input and reflect on what was happening on the ground.

Mr Mooketsa Ramasodi, Deputy Director-General: Agricultural Production, Health and Food Safety: DAFF, regarding budget cuts on the LDVs, explained that the Animal Health Care programme was assisting veterinarians in terms of the work they did and infrastructure to run the programme. The DAFF had spent the last two years working on the issue of veterinarians. The programme had received R124 million to do the work, but the budget had had to be reprioritised. The procurement of the LDV goods had cost the Department R10 million, and it had got permission from National Treasury to reprioritise the budget. The challenge was to get the money needed for the vehicles.

The Minister said the Land Bank had made funds available to both smallholders and commercial farmers. In its allocations, the it had focused on relief schemes, stock sale deposits, and concessionary funds. An assessment of needs had been done.

Ms A Steyn (DA) asked the Department to clarify the 2016/17 planned deliverables on the programmes of the office of the Director-General and trade promotion and market access, because she did not understand those areas. What had been done on Animal Health Care? How far was the Department with the veterinary strategy? Lastly, she said that farmers were up in arms over the available vaccines from Onderstepoort Biological Products (OBP), because it was not raining and those vaccines were not needed now. The ones that were needed now were not available.

Mr Kgobokoe explained that the reporting format indicated on the office of the Director-General and trade promotion and market access gave an overall performance. Where it was indicated as being “in progress,” it was not counted as not having been done.

The Chairperson intervened, saying that “in progress” meant it had not been done or completed.

Ms Steyn also intervened, saying the office of the Director-General was counted differently from trade promotion and market access. “In progress” had been counted as incomplete in trade promotion and market access, whereas in the former, “in progress” had been counted as complete.

Mr Ramasodi referred to the veterinary strategy, and reported that in 2012 the Department had conducted an analysis of the systems in the country. A report with options had been submitted to the National Treasury about the outcomes of the research in order to get funds. Unfortunately, funding had not yet been received.

The Minister said he had had a meeting with OBP, where it had been indicated it had to produce vaccines for the cure and prevention of diseases. However, it was a problem if it was producing vaccines that were not needed. The Department needed to know first why they had produced those vaccines, and would engage with OBP on this matter. Concerning animal health care, he said there was a disease that caused abortion in animals. When the animal was infected with this disease, it had to be killed. The only way to protect animals was to quarantine them when signs of the disease were detected.

Mr C Mathale (ANC) commented he was pleased with the report from the audit committee of the Department, because it provided assurance that whatever was going to come from the Office of the Auditor-General would be good. He also asked for clarity on the total figure for jobs created, because what had been presented in the document was not clear.

The Director-General had difficulty in answering the question but indicated there had been an overlap in terms of the figures. The Department was expected to report quarterly on youth, women, and disabled.

Mr Mathale insisted that in future, the document should be written clearly for everyone to understand what was being reported. The document had to be clear and not require human interpretation.

The Director-General said the paragraph should be taken off the document, and it would be corrected and sent back to the Committee.

The Chairperson wanted to know why the reporting format of the Department was hard to follow.

The Director-General explained it was the way he had found it done. He had tried to change it, but had been told that that was the way it had been done previously.

Mr Mathale agreed with the Director-General, saying that if it was hard to follow, it had to be changed and a format used that had been agreed upon. If the format was not what had been agreed on, the Department could go back and rectify it.

Mr Maloyi said if the reporting format was prescribed, the Committee would need to incorporate its own format to that of the Department. This would ensure both parties were on the same wavelength.

Ms Steyn added the format lacked the baseline they could work with. For instance, when one talked of fencing, one needed to know the number of hectares of the land, otherwise all this would become a problem. The Committee needed to know the percentage of the country that has been helped in terms of achievements, and to know the under-achievements, so that it knew what percentage of the country still needed help. The lack of a baseline made things difficult, and maybe that was why Treasury was not giving the Department money -- because there was no baseline.

The Chairperson indicated the Department was very lucky, because the national development plan (NDP) had given it a baseline which stated what it needed to do.

Mr R Cebekhulu (IFP), commenting on animal health care, said it appeared that livestock was being looked after, but in rural areas there were no veterinarians to help with the dipping tanks of animals. This made diseases worse. There were reports veterinarians would to be stationed in rural areas where cases of foot and mouth diseases were continuing. He also wanted to know if there were plans in place to work with the SA National Defence Force (SANDF) to curb the intrusion of foreign vessels into our maritime areas.

The Minister responded on the availability of veterinarians in rural areas, and said it was important to change the culture of dipping. Dipping should be used for administrative purposes. It was important to know the number of animals that were in a village. Another thing was to train the young to be para-veterinarians, so that they could to administer vaccines to animals. The dipping methods and tanks needed to be managed well. With regard to the patrol vessels, he indicated that the arrests that had been made proved that the Department had good monitoring systems and it had got to know where the intruding vessels were from. The Department was working with the SA Police Service (SAPS) and the SANDF to catch the vessels fishing illegally. The Department was committed to its monitoring systems to ensure what belonged to South Africa was protected. He added that the Africana vessel had been tested to meet local standards and was back at sea, doing its work.

Mr Ramasodi said there were 129 veterinarians who had been deployed to rural areas in order to revive areas where there were problems with animal health.

Mr N Capa (ANC) wanted to know what the link was between goats and plants in the Limpopo project, He also asked the Department to clarify the issue of fencing, because some people claimed that fencing was for livestock, some claimed it was for planting, and others said it was for grazing. He also wanted clarity on food and forestry because some people said forestry provided jobs for food, while others said forestry needed land.

Mr Ramasodi explained that the goat and plant project in Limpopo was for the improvement of both goats and plants in the region.

Dr Tau, on fencing, explained that the fencing of the agricultural land happens for various purposes: veld care for managing pasture, soil care, water care, grazing, and conservation care.

Dr Mmaphaka Tau, DAFF Deputy Director General, responded on the issue of food security and forestry, and said that forestry traditionally focused on woodlands. Now all over the world, SA included, the focus was on plantations, food security, and agro-forestry. The Department was busy developing an agro-forestry strategy to ensure there was harmony in land use.

Mr L Ntshayisa (AIC) wanted to establish if the employment equity figures presented by the Department were proportionate to the population of the country. He asked what the time frames for the completion of the borehole jobs were, and why the targets had not been met.

The Minister reported that in technical areas of agriculture, there were few black Africans. That was the struggle the Department was facing in trying to transform the industry. On the issue of boreholes, he said there was a need to go back to the provinces to find out what informed the gap and to see if funds had been committed, and to get to know the rationale for the establishment of the boreholes.

Dr Tau also added that the 37 boreholes that had been completed reflected the work delivered during Quarter 1. The Department was awaiting a report that was being compiled, and when it was completed it would be given to the Committee for consideration. The report would consider if some of the funds had been used to deal with the non-availability of water, and interventions for food security. The project of boreholes was handled by three programmes in the Department.

Mr S Mncwabe (NFP) said he appreciated the efforts of the Department regarding the graduate youth programme. It was a pity these achievements were not publicised in the media in order to attract the young to the profession. He wanted to establish when the Department was going to be able to meet the target for agricultural land rehabilitation.

Dr Tau informed the Committee that Quarter 1 dealt with the planning and purchase of equipment. Quarter 2 and 3 were about the actual doing of the work. The target was going to be achieved.

The Chairperson asked if provinces were ready for the planting season, seeing that there were budget cuts. How far had the Department gone to assist provinces with the drought-resistant maize? She enquired how funds for drought were going to be accessed to assist farmers. She wanted to establish why, at DDG level, there were only two females and at SMS level, the figure for females was standing at 43% against 57% for males. She asked why the Deputy Director-General of Fisheries was not at the meeting, whereas he used to attend all the meetings before the new Director-General was appointed.

The Director-General, on the readiness of provinces, said he had requested all heads of departments (HODs) to submit numbers and plans. However, it had become clear they were not ready. There was a plan to help in the planting of maize.

Dr Tau, regarding drought-resistant maize, said assistance had been given to provinces. 100 tons of drought-resistant maize would be distributed to farmers. A commitment had been made already. A media statement had been released about the drought recovery plans.

The Director-General added that the Department had made a request for R212 million to Treasury for assisting provinces. A committee had been set up to work with Weather SA in order to prepare for forecasts. A short-term arrangement of distributing Jojo tanks for water storage had been made. The long-term arrangement entailed predicting droughts and to plan.

Dr Tau, concerning drought funds, reported the Department was required to work with provinces on areas requiring funding for drought relief. The matter had been attended to already

The Director-General commented on the few females at DDG level, and said that the admission by the Minister on governance matters was honest. Time frames were being put in place and the Department was putting together programmes in the administration programme. The Department was busy looking at the profile of the staff members to ensure the right person was placed in the right portfolio.

The Minister said the Fisheries Deputy Director-General was in Japan, attending a conference.

Ms Z Jongbloed (DA) commended the Department for making sure the Africana vessel was doing her work at sea. She also remarked there was an individual by the name of Mr Booi who has been given a fishing quota along the West Coast, but did not have a big boat. He had entered into an arrangement with a foreign vessel, Desert Ruby. Section 39 of the MLRA stated there no foreign vessel was allowed to get into that kind of an arrangement unless it had been given a licence. She wanted to know if Desert Ruby had been licensed, or if it was the intention of the Department to license the vessel.

The Minister did not answer the question, but went on to say SA’s fishing industry currently contributed R46 billion to the economy. Three companies were dominating and five companies were subsidiaries of these three companies. They were mainly “lily white.” There was a fish that was rich in Omega3 and was known to be good for improving the IQ of children, but that fish was kept and frozen in the sea. The white companies exported it to Namibia, Angola and other countries. These white companies had refused access to a vessel, to hinder participation of blacks in fishing. The very same dominating companies were still fishing in Namibia. The Department would to give a report about the Act to see if Mr Booi was conforming to it.

Ms Steyn asked if the company had been given a licence.

The Minister said he would verify the question asked on Section 39. The Department did not have all the facts now. Currently, no black person had a fishing vessel.

The Chairperson reasoned that if the Act stated there must be no use of a foreign vessel and it was discovered that it had been used, then that meant the Department had broken the law. There was a need to re-look at the legislation so that it dealt with transformation and met the needs of our people.

The Minister said the Department had cleared the appeals that were in the Department. It was working hard on the issue of rights so that when it issued a person with a right and the person failed to conform with the law, the Department could go hard at him or her.

Ms Steyn commented that white maize was coming into the country. She suggested that when that importation came, the Department had to ensure the country did not experience labour problems.

Mr Cebekhulu wanted clarity on why tractors meant to assist people in rural areas had been withdrawn. He further wanted to find out if the imported maize had been genetically modified overseas or in other African countries, or if the country was importing organic maize, because some people became ill from genetically modified organisms (GMOs).

The Director-General said the tractors might have been brought and left in a state of neglect. The Department had taken them back to see how they could be used.

The Minister asked the Director-General to ensure he worked with the HODs to make sure the whole tractor project was planned carefully. Government tractors had disappeared when they were sent to the provinces. Each province had been given 75 tractors. Concerning the GMOs, he reported the Department had met companies in the food industry like Tiger Brands and Pioneer Foods on the issue of GMOs to clarify that GMOs did not have to be an impediment to human health

Mr Ramasodi added that in terms of bringing consignments to the country, the Department was working with different organisations to monitor the arrival of the maize. 3.3 million tons were expected to arrive. This was going to need a lot of coordination. The genetically modified maize could be coming from the US and Mexico.

The Chairperson remarked that the Department of Environmental Affairs (DEA) had made an announcement regarding the marine protected areas. The mining sector was moving with speed in taking over land, and this was affecting smallholder farmers. Now the ocean land was a target. She asked what the participation of the Department was in this regard, because it had come to the attention of the Committee that individuals in Ezemvelo in KwaZulu-Natal, who were fishing for survival, were being shot at.

The Minister said the DEA would decide on the matter, but the DAFF would also make a follow-up on this issue.

The Deputy Minister reported that the contracts of the companies that operated in areas where people had been shot at and killed, had been terminated.

The Director-General commented that the issuing of fishing rights to individuals was not working. As part of giving people a right to benefit from the sea, people in the coastal villages had been building community halls and clinics so that they could benefit from fishing.

Adoption of Minutes

The Committee’s minutes of 23 and 30 August, and September 2, were adopted 2016.

The meeting was adjourned.

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