Western Cape oversight visit and reflection on way forward

Agriculture, Forestry and Fisheries

19 February 2019
Chairperson: Ms M Semenya (ANC)
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Meeting Summary

The Committee and the Department were briefed by the Committee’s Research on the oversight visit to the Western Cape Province. The Researcher highlighted some of the concerns that were common in the farms visited, such as a lack of training and access to education facilities in farms like Lakeview. Most farms have a low Net Profit margin and do not have enough funding, government needs to intervene more to assist.

The Researcher added that there were problems with extension officers, implementing agents and mentors. They needed to be both monitored and trained to ensure that they delivered on their mandate and not focus on issues that were not related to their line of work. Some of the problems that exist were not the farms themselves but were in the value chain. The Committee agreed that the roles of extension officers, mentors and implementing agents needed to be clear so that they do not affect productivity on the farms.

Members expressed that there was a serious concern with the Kaapschon Boerdery farm, particularly the owner. There was suspicion that the owner of the farm might be misusing government funds. In such an instance, the Committee suggested that it is better to give funding to better performing and more accountable farms.

There is a need for a strong link between the three Spheres of Government when it comes to supporting and addressing agricultural concerns. The Committee has welcomed the call from the President of the Republic of South Africa, Mr C Ramaphosa to distribute government land. Both Members and the Department agreed that it will be more than just land that will be needed but availability of enough water supply to ensure that farming actually takes place.

Meeting report

The Chairperson welcomed members and guests to the meeting. She handed over the flow to the Researcher of Parliament, Ms Qwabe to comment on some of the reflections of the oversight visit.

Briefing by the Committee Researcher on the Reflections of the Oversight Visit

Ms Qwabe said that based on the analytical report she put together, she would tackle some of the major highlights and concerns.

On the Lakeview farm, she said that there are beneficiaries who are on and off the farm, those on the farm are workers on the farm and those off the farm are workers on other farms. The major concern that she raised was that it would not work having these beneficiaries as farm owners because they lacked sufficient expertise. Access to the export market is an issue and the farm does not have enough storage facilities. The farm paid, Two a Day, an implementing agent for them to have access to the export market and this increased its costs. For the farm to be economically viable as a fruit farm they needed to have at least 55 hectares of planted land but it only has 31 hectares that is planted, plans for expansion exist but there is no funding. Training, skills transfer and education of the children of beneficiaries was a major concern. Beneficiaries noted that they would be happy if their children would have access to education to gain the necessary expertise to run the farms.

There are so many beneficiaries on the farm that exist and an option to buy some of them out was raised to ensure that there is some form of order and control, to reduce the number of beneficiaries. However, the valuing of the total compensation was an issue in terms of deciding on the total buy out amount.

With regards to the Amaqhawe project which focuses on winter grain and livestock; there were institutional agreement problems with the implementing agent/mentor, Agri-Dwala. A payment of R200 000 per annum was made to the agent for mechanisation. Members of the Committee raised a concern during the visit in terms of how the farms would benefit if they were being asked to pay such an amount just to have access to mechanisation. She said that the Net Profit of the farm was relatively low and the farmers on the project cannot be able to purchase their own farm. There is no economic benefit being derived from the project itself.

On the Iqhude supply farm ran by a mother and daughter which engages in mixed farming; there were issues of mistreatment. The farmers tried to source help to improve the infrastructures on the farm, but third-party service providers were not willing to assist as well as the local municipality itself. Visits by the extension officer who used to come frequently to the farm declined. She said that the Committee suggested that strong monitoring needs to take place to ensure that extension officers show up for their scheduled visits and that they are monitored on the quality of service provided. She added that there are students who were involved in the Iqhube farm and attend Elsenburg College but need to be helped. In addition, there is a need to address the funding and communication channels between the National government, Provincial government and to the project.

Umhlaba Wobizo farm which primarily focuses on grain and cattle has its own challenges. She mentioned the legal matter between Agri Mega and Umhlaba which is before the Courts. She said that there are problems with extension officers and the quality of service provided; there is a need for improvement.  

On Paardenkloof farm which engages in mixed farming; the Committee was impressed by the infrastructure in the farm. The farm produces well but cannot export. Outsourcing some of the processes of the farm in making the wine was another key issue of concern. Having processing units would be more cost-effective. The farm borrowed from the Land Bank and did not get a good preferential rate. This has led to a severe financial burden.  

She said that the costs of the farms mentioned are massive and running on low-profit margins. The value chain needs to be looked at. She questioned how these farms can be made more economically viable. The challenges are not on the farms but along the value chain.

Discussion

Ms A Steyn (DA) said that she was concerned about the Kaapschon Boerdery farm which mainly produces apples and pears and is owned by the Joseph Hendricks Family Trust. The farm might be “cooking the books”, because it was impossible for the farm to not generate a profit considering the total number of hectares planted. The farm might be selling some of its products through the informal sector. She asked if this is recorded. She further highlighted that the farm got the biggest support from the government.

The Chairperson said that the farm owner of Kaapschon Boerdery was not appreciative of the support given by government. The owner is very arrogant.

Mr P Van Delan (DA) said that he thinks that the owner of Kaapschon Boerdery was misusing government resources and there are other farmers who can be able to make better use of the funding.

Mr N Capa (ANC) said that on the Iqhude farm, the pigs on the farm are at a stage where they can be able to be marketed, but the farmers said that they do not have transport to send them off to the market. Marketing in farming is an area of concern.

Mr Van Delan said with regards to providing children access to education and funding; NSFAS funding was refused because they were told that the parents earned a lot of money. Therefore, cannot qualify for funding but yet that was not the case on the ground. People desperately need help. The access to education was critical because these children would be able to plant their knowledge and expertise back into the farms.

The Chairperson agreed with Mr Van Delan and said that training of farm management was important.

Ms Steyn was concerned about the Lakeview farm and wanted to know the role of extension officers. The officers need to have discussion forums and talk about their observations.

The Chairperson said that there is a need for a strong link between the three Spheres of Government when it comes to supporting and addressing agricultural concerns.

Mr Van Delan said on the Amaqhawe project if the government decides to help farmers, it also pays people within the government itself to help on the projects involved. There is a need to have set structures of ensuring that funds were not wasted, this will help ensure that there is full utilisation of the funds allocated to beneficiaries.

The Chairperson said that implementing agents are an issue and took a significant portion of the funds within the projects. She was happy that the President, Mr Ramaphosa made a statement that government land will be given to the public; this would help curb some of the issues that persist and the rules of the game need to be regulated.

Mr A Madella (ANC) said that there was a need to review the roles of mentors and implementing agents. The implementing agents seem to have a lot of control of what goes on, on farms, how funds were allocated. He also mentioned the arrogance of the farm owner of Kaapschon Boerdery and that there is resentment towards the government. He said that separate consultations should happen between implementing agents and the farmers when oversight visits take place. The Department of Agriculture, Forestry and Fisheries needs to monitor some of the charges that are charged by municipalities on farms.

Ms M Chueu (ANC) said that the presence of the Director-General in oversight meetings was important. She was concerned that the DG is never present when oversight meetings took place. His presence is important because some of the issues that are being raised are things that he needs to hear and establish a way forward on resolving the matters. She was also concerned about the job description of extension officers if they cannot be able to assist farmers with the farming itself. Extension officers are hired on the basis that they understand agriculture, they need to assist more. She said that farmers are not supposed to buy land that is not arable because this will result in product failure.

Ms Steyn was happy with the role played by farmers linking with their neighbours and assisting each other with farming. This seems to have worked on most farms and she would like to see it happen across the country.

The Chairperson said that when it comes to dealing with implementing agents in the Northern Cape, the National Government was tasked to investigate; Free State had the same problem. She wanted to know how the DAFF is dealing with this. Some of the agents have stolen money from the government, how will they pay back the government? There should not be implementing agents, the National Government should be able to have their own implementations, this also applies to the Provincial Government. A comprehensive report on the agents needs to be provided to the Committee. Those who are found wanting should be brought to book.

Response

Ms JS Isaacs, Head of Department of the Agriculture: DAFF, said that the Western Cape only has 70 extension officers. It is not government’s duty to farm and farmers need to be independent. Furthermore, funding for the Western Cape Province alone totalled R800 million.  

The government does not buy land and when projects are done, they are done on land that is already owned. There is a need for National Rural Development to work with the Province; it is not only about the local municipalities working with the Provinces.

She welcomed the call from The President on the allocation of State land as it provides access; however, it will also be important to have more access to water as access to land only was not enough to drive the call, a Water Reform is needed.

Implementing agents are paid a total sum of R25 million a year. She said that she sanctioned the Provincial Treasury to Gazette how the funds are used and paid to ensure the presence of accountability. The Department does not have enough expertise to do everything and thus they employ external agents. Graduates are no longer being trained but the Department sets aside funds to ensure that training takes place, including training extension officers.

During oversight visits people express themselves and they are also demanding, but the funding was not enough to meet every demand made. One of the biggest challenges faced by the country was that for one to study an agricultural course they need to have passed mathematics and many students are keen on studying agriculture, but they do not have maths. She was concerned about how that gap can be dealt with. The Department currently supports eighty-three bursary holders at the College level. The Department supports seventy bursaries to young people to study agriculture.

In all projects involved, the Department encourages people to master the importance of financial record keeping. Even though support was available, some farmers are not willing to share or reveal their financial records.

Lastly, she clarified that she does not pay mentors. She only pays for their telephone costs.

Mr S Buthelezi, Deputy Minister: DAFF said that he appreciates the oversight visit and the feedback given. Government needs to work on both giving lands and ensuring that there is enough access to water. He was concerned that farmers were being given funds without having prior financial statements; this is a big gap that needs to be resolved.

Emerging farmers need to be supported through training to ensure that they are successful. Farmers need to be trained on how to run farming as a business. He added that mentors are only supposed to assist on how to farm and are not supposed to take over the farming process; they are only supposed to come and go. A policy should be put in place to avoid issues arising. Issues arising in the Western Cape might also be affecting other Provinces and various parameters need to be set to ensure that solutions to problems are readily available.

Mr Van Delan asked about the progress on pending Court cases concerning implementing agents.

The Chairperson replied that legal issues are being dealt at a National level and a report will be provided at a later stage. She thanked the Department for taking good care of the Western Cape Province. She said that the Committee is raising issues so that the Department can be able to do better in areas which it lacked. The Committee will finalize the oversight report after it is adopted by Members and it will be dealt with by the Sixth Parliament. The new Committee will then make a follow up on pending issues.

The Department should not wait to be called again to the Committee in the new term to address issues that it can address at the moment. Operation Phakisa needs to be put into place in farming and implementing agents much be in place and be backed up by Provinces. She thanked the Department for coming.

The meeting was adjourned.

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