Plant Improvement & Plant Breeders’ Rights Bills: finalisation; Department of Agriculture, Forestry & Fisheries 2015/16 Annual Report: DPME briefing

Agriculture, Forestry and Fisheries

11 October 2016
Chairperson: Ms M Semenya (ANC)
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Meeting Summary

The Department of Agriculture, Forestry and Fisheries (DAFF) should partly shoulder the responsibility for the slow growth and job losses in the agriculture sector, because it had not been successfully paying attention to investment constraints in the sector. The Department of Planning, Monitoring and Evaluation (DPME) reported this when it was briefing the Committee on the 2015/16 annual performance assessments of the DAFF and its entities.

The Committee heard that the programmes of DAFF were not having a significant impact on household food security and the utilisation of agricultural land, growing the industry in terms of contribution to the gross domestic product (GDP) and employment, and transforming the sector by making new entrants commercially successful. The causes of the problem appeared to include weak relationships between the government and industry, and the high level of senior management vacancies.

The DPME further informed the Committee the cost of the basic food basket had risen significantly and was restricting access to food, especially for indigent households. Less than a fifth of South African households were involved in agricultural production. Household access to food had remained static since 2011. This food access problem was most prevalent in the North West, Mpumalanga, the Northern Cape and the Eastern Cape. To remedy the situation, it was suggested that consultations with all stakeholders about the interventions proposed in the National Food and Nutrition Security Plan were greatly needed, and the National Food and Nutrition Security Plan, which was under the leadership of the Office of the Deputy President, should be finalised and implemented.

The DPME also reported that a total of 9 363 jobs had reportedly been created through the Comprehensive Agricultural Support Programme (CASP), comprising of 1 997 permanent (21%) and 7 366 (79%) temporary or seasonal jobs. Many parts of the country had experienced drought conditions. The industry’s decline of 0.8% in the second quarter of 2016 was mainly the result of decreases in the production of field crops and horticulture products.

The Committee heard that a total of 9 155 smallholder producers had been supported through various initiatives, such as the CASP. However, there were areas of concern. The devastating 2015 drought conditions and rising prices of production inputs and mechanisation had contributed to a decline in agricultural production. Farmer support programmes were fragmented and not impactful.

The Committee was also told that the seven entities of the Department were generally not functioning and performing as envisaged, even though they played a vital role in supporting the department on Outcomes 4 and 7. However, there had been notable improvements in the Agricultural Research Council (ARC), with the entity’s vision 2035 document currently under consultation.

The DAFF and the Department of Rural Development and Land Reform (DRDRL) had been approached by the National Treasury and the DPME to rationalise and refocus its agricultural support and rural development initiatives for the country. Following this intervention, the DRDRL and DAFF had agreed that “soft” issues be dealt with by the DAFF and the “hard” issues by the DRDLR.

Members wanted to know if the DPME monitored the agriculture entities because there were reports that these entities were generally not performing; asked for clarity on the difference between the “soft” and “hard” issues that DAFF and DRDLR had to deal with; wanted clarity on whether the new target for land reform was now 20%; stated that the report had been quiet on the working conditions of farm workers; and commented that the integrated procurement system designed by National Treasury was seen to be closing opportunities for smallholders, and was more difficult to access than the previous tender board system.

The Committee adopted the proposed amendments to both the Plant Improvement and Plant Breeders’ Rights Bills.

Meeting report

Plant Improvement Bill

Ms Phumelele Ngema, Parliamentary Legal Advisor, took the Members through the proposed amendments to the Plant Improvement Bill, clause by clause.

The Chairperson asked the Members to focus on Clauses 55 and 56 and state if they agreed or disagreed with the proposals of the Parliamentary Legal Advisor.

The Parliamentary Legal Advisor requested the Committee to re-apply itself and reconsider its instructions in respect of the proposed amendments respectively, in Clauses 55 and 56 of the Plant Improvement Bill, and Clauses 51 and 52 in respect of the Plant Breeders Bill. This was because the proposed changes may make the Bill toothless and impractical.

Mr P Maloyi (ANC) agreed with the advice from the Parliamentary Legal Advisor. He said their responsibility as representatives of the public was to see to it that all the legislation they passed had to be understandable to everyone, and not be interpreted only by lawyers. The Bill also listed the issues the Committee wanted the Minister to look at rather than letting the Minister point out what needed to be looked at.

Mr C Mathale (ANC) agreed with Mr Maloyi.

The Chairperson asked if Members agreed with the proposals as they were.

Ms A Steyn (DA) moved for the adoption of the proposed amendments, as reflected in the A-List.

Plant Breeders’ Rights Bill

Ms Kanthi Nagiah, Chief Director: Legal Services, Department of Agriculture, Forestry and Fisheries (DAFF), took the Members through the proposed amendments to the Plant Breeders’ Rights Bill, clause by clause.

The Chairperson asked if the Members agreed to the proposals as they were.

Ms Steyn agreed, and moved for the adoption of the proposed amendments as reflected in the A-List.

Mr S Mncwabe (NFP) seconded Ms Steyn.

Mr N Paulsen (EFF), who came late for the meeting, said he did not understand why people could “take what nature had granted us and make it theirs.” The Bill took away everyone’s rights on food production. This was going to allow multinationals to control food production.

The Chairperson reminded Mr Paulsen that when the Committee had started with the Bill, it had looked at the regulatory framework. Discussions had been held and new clauses had been added to protect new entrants with cultivars. These had dealt with how to register the cultivar in the country and what one must do to qualify through the Register. The Bill had looked at the Constitution of the country in order to protect the developmental nature of SA as it adhered to signed international agreements.

Mr N Capa (ANC) reminded the Committee that a lot of work had been done, and the Committee had reached the stage where it was at now. There was no turning back.

Mr Maloyi stated this was not the time to ask why the Bill had been established. The adoption of the proposed amendments was a confirmation of the road traveled.

Ms Steyn said if Mr Paulsen had a problem, he should have made a submission during the public hearings. Unfortunately, his contribution was too late.

Mr Mathale indicated that this matter did not need a debate. The Committee must move to the next item.

The Chairperson remarked they had learnt so much from the Bill in order to achieve food security. She thanked the Members for their contributions.

Department of Performance Monitoring and Evaluation (DPME): briefing

Dr Tsakani Ngomane, Outcome Facilitator on Rural Development and Environment: DPME, briefed the Committee on the Department’s assessment of the 2015/16 annual performance of the Department of Agriculture, Forestry and Fisheries (DAFF) and its entities and the Management Performance Assessment Tool (MPAT) results, in preparation for the Budget Review and Recommendation Report (BRRR) process.

She pointed out that Outcome 7 seeks, amongst other things, to implement DAFF-led initiatives such as improving food security and development of smallholder producers and provision of technical and infrastructure support for agrarian transformation.

Tabling her analysis on sustainable land reform, she reported that the newly acquired land remained fallow. This implied that the DAFF’s farmer support programmes were either inadequate or not yielding the desired outcomes. Recent findings from StatsSA indicated that only 12,1% of the households involved in agriculture reported getting agricultural-related support from government, with significant support provided for farming in KwaZulu-Natal (18,1%), the Eastern Cape (24,1%) and Northern Cape (12,9%). At the same time, the number of households involved in agricultural production had dropped by 550 595 (19.1%) -- from 2 879 638 to 2 329 043.

Drought had had a severe effect on the cultivation of land and food production. During the quarter under review, a mere 1 134 ha, or 6% of the targeted 18 135 ha of under-utilised land, had been cultivated for production. The consolidated report by the provinces showed that 78 077 ha had received support in that quarter. However, these reports were still not sufficient to satisfy the evidence required according to the Technical Indicator Description.

She recommended that the government’s implementation of the Nine-Point Plan should result in the achievement of the target to reduce under-utilisation of newly allocated land by 2019. The “one household, one hectare” project should further aim at the cultivation of under-utilised land. The implementation of the AgriParks production plans aimed at revitalising the agricultural sector and rural communities in the 27 resource-poor districts should be accelerated. 45 AgriParks were at various phases of establishment and 57 farms had been acquired to support the initiative.

She said that the Operation Phakisa on agriculture, land reform and rural development should, among other things:

  • devise interventions on how growth per identified value chain and transversal programme could be inclusive, and in turn contribute to the vision of the National Development Plan (NDP) and the Revitalization of the Agriculture and Agro-Processing Value Chain (RAAVC);

  • review employment and working conditions among agricultural workers;

  • review producer support models and related institutional arrangements;

  • reduce the environmental impact of agricultural production through interventions to improve soil fertility, environmentally sound agricultural pest control, and improvements in water management;

  • determine the role and relative importance of technological development and innovation in advancing agricultural production and sustainable livelihoods.

With regard to food security, she said that the cost of the basic food basket had risen significantly and was restricting access to food, especially for indigent households. The reduction in the percentage of households vulnerable to hunger was largely due to social grants, which were enabling the purchasing of food rather than food production initiatives. Less than a fifth of South African households (16,9%) were involved in agricultural production. Household access to food had remained static since 2011. This food access problem was most prevalent in the North West (39%), Mpumalanga (31.7%), Northern Cape (31.3%) and Eastern Cape (28.4%).

She suggested that the DAFF and Department of Environmental Affairs (DEA) must have plans ready for the fire season and flash floods following the drought. Consultations with all stakeholders about the interventions proposed in the National Food and Nutrition Security Plan were greatly needed. The National Food and Nutrition Security Plan, which was under the leadership of the Office of the Deputy President, should be finalised and implemented.

Pertaining to the development of smallholder producers and provision of support for agrarian transformation, Dr Ngomane reported that the third draft of the Comprehensive Producer Development Support Policy had been developed. It would regulate and guide interventions provided to the various categories of producers by government, the private sector, civil society and other organisations. 216 ha of land under irrigation was used by smallholder producers. The revitalisation of 16 irrigation schemes targeting 664 farmers in KZN was in progress. The construction of an overnight reservoir in Vaalharts was in progress. A total of 9 155 smallholder producers were supported through various initiatives, such as the Comprehensive Agricultural Support Programme (CASP).

There were some areas of concern, even though smallholders were receiving support. The devastating 2015 drought conditions and rising prices of production inputs and mechanisation had contributed to a decline in agricultural production. Meanwhile, farmer support programmes were fragmented and not impactful. The result was that less than a fifth of South African households (16,9%) were involved in agricultural production in 2015.

In the interest of food security, water allocations need to be re-prioritised towards agriculture. The National Development Plan (NDP) estimated that 1.5 million ha under irrigation (about 50 000 ha was located in former homelands and had been allocated to smallholders) could be expanded by 500 000 ha. The Department of Water and Sanitation, in their National Water Resources Strategy, had indicated that there was water available for the expansion of irrigation by only 80 000 ha, and DAFF’s own calculations, based on available water resources and land suitable for irrigation, revealed that only 35 000 ha could be further developed through irrigation.

Dr Ngomane reported that the reduction in the rural unemployment rate was standing at 45.8%, as reported during the second quarter. A total of 9 363 jobs had reportedly been created through the CASP, comprising of 1 997 permanent (21%) and 7 366 (79%) temporary or seasonal jobs, with males 4 676 (49%) filling jobs against 4 687 (51%) females. The NDP had identified primary agriculture as one of the key sectors for addressing food security, job creation and economic growth, especially for rural communities and small towns. Agriculture was a catalyst for economic growth. The agriculture, forestry and fishing industry had contracted for six consecutive quarters. Many parts of the country had experienced drought conditions. The industry’s decline of 0.8% in the second quarter of 2016 was mainly the result of decreases in the production of field crops and horticulture products.

She proposed that, as a growth sector, agriculture should be isolated because it delivered more jobs per rand invested than any other productive sector and remained crucial in the face of rural poverty and food security. The implementation of the Nine-Point Plan should be accelerated. There should be commitment to implement the initiatives arising from the Operation Phakisa on agriculture, land reform and rural development, and to advocate for resources to support implementation of the plans.

Regarding the management of public entities, she said the seven entities were generally not functioning and performing as envisaged, even though they played a vital role in supporting the department on the achievement of Outcomes 4 and 7. However, there were notable improvements in the Agricultural Research Council (ARC), with the entity’s vision 2035 document currently under consultation.

Dr Ngomane referred to the Auditor-General’s findings, and reported that the Department had received an unqualified audit for the 2015/16 period. The Auditor-General (AG) had stated that the material misstatements in the annual performance report submitted for auditing on the reported performance information had been identified, and the management had subsequently corrected only some of the misstatements. The AG had pointed out that performance targets should be specific in clearly identifying the nature and required level of performance. The AG had further noted that the financial statements submitted for auditing had not been prepared in accordance with the prescribed financial reporting framework. Management had not exercised adequate oversight in the areas of performance planning and compliance with the National Treasury’s Framework for Managing Programme Performance Information (FMPPI) to ensure that performance targets were specific in clearly identifying the nature and required level of performance. The Department’s monitoring controls were not always effective to ensure the complete recording of biological assets, accruals and payables, which had resulted in the financial statements being subjected to material corrections.

In her conclusion, Dr Ngomane said that the slow growth and loss of jobs in the sector could be attributed in part to the global economic decline, but the DAFF had not been successful in addressing constraints to investment in the sector. Though the Department had embarked on some strategies aimed at stimulating production by smallholders, DAFF’s programmes were not having a significant impact on household food security and the utilisation of agricultural land; growing the industry both in terms of contribution to GDP and employment; and transforming the sector by making new entrants commercially successful.

Further, the DAFF and the Department of Rural Development and Land Reform (DRDLR) had been approached by National Treasury and the DPME to rationalise and refocus on agricultural support and rural development initiatives for the country. Following this intervention, the DRDRL and DAFF had agreed that the “soft” issues be dealt with by the DAFF, and the “hard” issues by the DRDLR.

Lastly, following a concern repeatedly raised by the DPME emphasizing a need to conduct a baseline study to serve as a database on smallholder producers, the DAFF had decided to do a proper census on agriculture in 2017. The decision to conduct an agricultural census was commendable, and its implementation should be supported by all concerned.

(Graphs and tables were shown to illustrate performance ratings based on the four impact indicators; vulnerability to hunger and access to food; employment figures on CASP conditional grants; and the Management Performance Assessment Tool (MPAT) 2015 score card)

Discussion

Ms Steyn remarked that it was good to see that agriculture was featured in the Nine-Point Plan. That meant something right was happening. There was a need to have a baseline, because the Committee did not know where they were working from and what the numbers were compared to. She wanted clarity on whether the new target for land reform was 20% or not, because initially it had been 30%.

Dr Ngomane agreed with Ms Steyn’s remark that agriculture was a catalyst, and the country was beginning to prioritise this sector. There was a realisation of this sector’s potential for economic growth contribution and food sovereignty of the country. This was important for food security and access, especially for those in the rural areas. The whole of society should embrace this. On the baseline issue, she had asked the Department to close all the loopholes or gaps in the baseline. Regarding the land reform target, she explained that 20% was not the new target. The 9% achieved had been from the initial 30%. The Department still had to achieve 21% and had decided to extend the period. When the target was set, there were no systems in place -- data, location of land, etc.

Mr N Capa (ANC) asked for clarity on the difference between the “soft” and “hard” issues that DAFF and DRDLR had to deal with.

Dr Tsakane explained that the two departments, the DRDLR and the DAFF, were considering the alignment options between and within the programmes under the guidance of the National Treasury and the DPME. These were meant to enhance efficiency, eliminate duplications and maximise the professional capacities linked to each department. For example, both departments provided off and on-farm infrastructure, and technical, production and market access support. The option under consideration was for the DRDLR to focus on “hard” issues, which were off-farm infrastructure: roads; bulk water; irrigation systems and communal fencing. The DAFF, on the other hand, would focus on on-farm infrastructure, such as fencing, boreholes, dip tanks, and technical issues; production, and market access support. These were the “soft” issues.

Mr Maloyi wanted to know which of the three figures presented on hectares of land under irrigation was reliable and scientific. He asked what the difference was between APP and BAPP.

Dr Tsakane explained they decided to settle on the 80 000 ha figure the Water Resource Institute had come up with because of its competence on water. On the difference between APP and BAPP, she said the concept and discussion document was the APP, and then the second draft or the final version was called the BAPP.

The Chairperson wanted to know if the reflected stagnation on food security meant that the Committee’s intervention was not having an effect or, if it had not intervened, could have made things worse. She remarked that the outcome of Operation Phakisa should look at the coordination of activities between the Department and the agriculture sector. Provinces were not aligned to the Department. If they were aligned, there would be no coordination in the sector. The report had been quiet on the working conditions of farm workers. There had been general reports that foreign nationals were being employed at the expense of the locals. Lastly, she commented that the integrated procurement system designed by National Treasury was seen to be closing opportunities for smallholders, and it was more difficult to access than the previous tender board system.

Dr Ngomane, with regard to the stagnant graph on food security, said this meant it had been successful in the intensification of its interventions in terms of food distribution and access in order to reach the vulnerable and rural areas. The activities of the Department of Social Development around food security should complement what the DAFF was doing, instead of having disjointed activities. That was why the National Food and Nutrition Security Plan had been developed. Concerning Operation Phakisa outcomes, she said these would be presented once they had been launched by the Presidency on the partnership between the DRDLR and DAFF. The issue of farm workers would also be included in the outcomes of Phakisa. Pertaining to support for smallholders, she reported there were some worries regarding the slow progress on the “set aside” targets. The economic cluster should be able to produce information on that. Unfortunately, the DPME could not report on it.

Mr Maloyi wanted to establish if the DPME monitored the agriculture entities, because there were reports that these entities were generally not functioning and performing.

Dr Ngomane responded that they tracked the performances of the entities through the ministries they reported to. The DPME did not report on the entities except when they were asked to.

Ms Steyn wanted to know who gave directives on the oversight of state owned enterprises (SOEs).

The Chairperson said the Committee had the right to perform oversight on the entities of the Department. She added that the National Food and Nutrition Security Plan should have a time frame. It was hoped Operation Phakisa would speed up things, and put a time frame on it.

The meeting was adjourned.  

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