The Department of Agriculture, Land Reform and Rural Development presented its revised Annual Performance Plan to the Committee in a virtual meeting.
The Department indicated that the original budget had been set at R16 810 056 000 and was adjusted downwards by R2 393 744 000; it now sat at R14 416 312 000. All of the Department’s six programmes saw a reduction. This included: Land Restitution being adjusted downwards from R3 431 786 000 to R3 028 515 000. Food security moved from R2 651 377 000 down to R1 703 791 000. The budget for compensation of employees was reduced from R4 444 485 000 to R4 144 485 000. The goods and services budget was reduced from R3 589 083 000 to R3 289 191 000.
The Members asked for a projection of job losses within the agricultural sector. They noted that there was support for substance farming in the budget but asked what support was being offered to the other farmers, especially in light of the jobs that would be lost. Does the Department have a plan which entails a provincial breakdown on how to assist farmers whose applications for COVID-19 Agricultural Disaster Fund were unsuccessful?
Members asked whether the Department had an actual plan that outlined how it would catch-up on delivering core services related to land, food security and farmer development and support over the Medium-Term Strategic Framework period in order to meet the National Development Plan targets.
Members also asked how the Department was going to mitigate the areas that had been cut from the budget concerning land claims given that there were land claims dating back to 1998 which had not yet been settled.
Briefing by the Department of Agriculture, Land Reform and Rural Development
The Acting Director-General stated that the Department had seven strategic outcomes. These included:
- Improved governance and service excellence
- Spatial transformation and effective land administration
- Redressed and equitable access to land and producer support
- Increased production in the agricultural sector
- Increased market access and maintenance of existing markets
- Integrated and inclusive rural economy
- Enhanced biosecurity and effective disaster risk reduction
The Chief Financial Officer, Mr Jacob Hlatshwayo, held that the original budget was R16 810 056 000 and was adjusted downwards by R2 393 744 000. The current budget now sat at R14 416 312 000. Land Restitution was adjusted downwards from R3 431 786 000 to R 3 028 515 000. Food security moved from R2 651 377 000 to R1 703 791 000.
[Please see the presentation for programme adjustments]
The Compensation of Employees (CoE) budget was reduced from R4 444 485 000 to R4 144 485 000. The goods and services budget was reduced from R3 589 083 000 to R3 289 191 000.
On 21 April 2020, the President announced an economic recovery stimulus package of R500bn. Within that was an allocation of R100bn for job creation and retention. The agricultural sector was identified as one of the sectors with the potential to stimulate the economy. For the funds to be allocated, the implementing department had to include associated targets in its revised 2020/21 APP. The funds formed part of the President’s Employment Stimulus and were therefore additional to what was allocated to the Department and they were to be spent within the 2020/21 FY, and there were to be no roll-overs. As part of strengthening food systems, the DALRRD was identified as one implementing department and was to use the allocated R688 million to provide support and relief to 50 000 subsistence farmers.
The Department was embarking on six programmes. These included:
- Administration, whose budget was reduced from R2 732 229 000 to R2 645 657 000.
- Agricultural Production, Health, Food Safety, Natural Resources, and Disaster Management, whose budget was reduced from R3 220 722 000 to R3 031 651 000.
- Food Security, Land Redistribution, and Restitution, whose budget was reduced from R8 117 180 000 to R6 222 120 000.
- Rural Development, whose budget was reduced from R1 097 774 000 to R897 981 000.
- Economic Development Trade & Marketing, whose budget was reduced from R 885 580 000 to R749 658 000.
- Land Administration, whose budget was increased from R756 571 000 to R869 245 000
Ms M Mokause (EFF, Northern Cape) indicated that EFF rejected the adjusted budget. She asked why the Department targeted to cut the restitution budget.
Mr A Cloete (FF+, Free State) expressed that the Minister’s absence from the meeting was concerning. He was also concerned as to why the food security budget was reduced.
Mr C Smit (DA, Limpopo) asked why the Administration and Registration Deeds had been adjusted upwards. How did this contribute to relieving the situation caused by COVID-19?
He asked for a projection of job losses within the agricultural sector. He noted that there was support for substance farming in the budget but he asked what support was being offered to the other farmers, especially in light of the jobs that would be lost. He also expressed his concern about the food security budget being reduced. Due to the budget adjustments, how long it is going to take concerning the land reform programme? He said that he could not see how this budget was going to contribute to the crisis that the country was in and it was mind-boggling.
Ms W Ngwenya (ANC, Gauteng) asked whether the Department had an actual plan that outlined how it would catch-up on delivering core services related to land, food security and farmer development and support over the MTFS period, in order to meet the NDP targets.
She asked to what extent the budget reduction would impact on the success of the land acquisition and the support to the Communally Property Association as well as the Labour Tenants Programme.
Mr P Marais (FF+, Western Cape Provincial Legislature) noted that six traditionally commonly held land by coloured people were transferred to the coloured rural communities. He asked which six these were, since there were 11 in total.
Mr M Nhanha (DA, Eastern Cape) noted that he read in a newspaper article that there was a prediction that most of the small wine farms would have to close, which would result in job losses unless they could get international investments. However, it would not be all small wine farms that would be able to do that and it would be in the best interest of the Department to keep them open. Closing them would result in job losses and loss of revenue for SARS. He asked if the Department had any contingents plan to ensure that they did not close.
Ms L Bebee (ANC, KZN) asked if the Department had a plan which entailed a provincial breakdown on how to assist farmers whose applications for COVID-19 Agricultural Disaster Fund were unsuccessful.
She asked whether the Department had a catch-up plan to adjust the budget reduction on the compensation of employees which would have an impact on the filing of vacancies, particularly the critical and senior management positions.
Mr T Matibe (ANC, Limpopo) pointed out that on the provincial adjustment there was a serious hammer, especially on the Limpopo province. Looking at the importance of agricultural revenue in Limpopo, the hammer was too much.
On the 15 000 subsistence farmers that were going to be assisted, he asked if there was a provincial breakdown so that Members could see the distribution.
He asked how the Department was going to mitigate the areas that had been cut from the budget concerning land claims given that there were land claims dating back to 1998 which had not yet been settled. Considering the situation with COVID-19 he asked how the Department was going to do that since this required interaction with communities.
He asked how far the Department was with the domestication Malabo declaration as this could help in dealing with issues of food security and the support that needed to be given to farmers.
Mr Smit noted that the Minister was part of the National Command Council for the state of disaster. He asked if the Deputy Minister could tell the Committee whether the Department, in the interest of the alcohol ban and of the farmers, advocated for farmers in the council deliberations.
Ms Bebee wanted clarity on the selection process for the Presidency employment stimulus package. The Department statistics stated that there were far more than 15 000 subsistence farmers. She asked who and how they would be selected.
The Chief Land Commissioner, Ms Nomfundo Ntloko-Gobodo, said that the adjusted budget for the Department was done at the instance of the National Treasury and it was not a situation where the Department wanted to take away the money but it had no other option. The Department tried to show how this would impact its work, but this was a situation that was beyond its control. The APP had to be revised. The budget had been adjusted down by R400million, and R300 million had been exactly at the household budget line item which was the money that the Department used to pay for land acquisition or financial compensation that it was paying to the beneficiaries. The target was to achieve more than what had been adjusted downward depending on how many claims the Department could settle over and above the ones that it had adjusted. However, the Department would focus on other business processes that did not require them to use the resources that had been deducted.
She noted that the Limpopo province had not necessarily been affected. The numbers that the Department had identified in the normal APP had not been revised downward, but the Department had a lot of claims that were outstanding in the bigger provinces which were Limpopo, KZN, Mpumalanga, and Eastern Cape. The Department did have a strategy that it had put in place to try and chase those claims. There were some claims which had been referred to the court and the Department was waiting for the court to adjudicate on those.
The impact of COVID-19 continued to be felt across provinces. More offices were closed once a member of staff was affected.
Mr Hlatshwayo, on why the land Administration and Registration Deeds’ budgets were adjusted upwards, responded that the Department had had offices closed as a result of the pandemic and one of the offices was the deeds office. As such, this office had not had any revenue. Additionally, there was a possibility that the staff members would not be paid their monthly salaries; the Department then had to go back to the Treasury and ask for approval to transfer R150 million to the deeds office.
Mr Mooketsa Ramasodi, DDG: Agricultural Production, Health and Food Safety, indicated that the Malabo Declaration was set out in 2014 and the first annual report was in 2018, with the second one in 2020. In 2018 South Africa was on track to reach the seven critical areas that had been identified to end hunger by 2025. These included: enhancing investment in agriculture; recommitment to the principles and values as per the comprehensive agriculture development programme; boosting inter-African trade; enhancing climate change variability; and looking at aspects relating to mutual accountability to the actions of member states. In 2020, South Africa (SA) fell behind and part of it was because of data. The areas that were not on track were the area around the commitment of investment in finance and COVID-19 in its current state would cause the Department to not do well in this area; it did well in terms of its commitment to the cut-up process. Concerning ending hunger, the Department was currently not doing well but this had to be looked at in the framework that it had to put up. The Department was currently developing the framework to ensure that the DALRRD was on track with the assessments that it would do in identifying hunger hotspots and reporting accordingly.
He reckoned that the Department had done well in the reduction of poverty through agriculture and also promoting inter-Africa trade. Its input in climate variability was not well and in terms of mutual accountability, the Department did well. This meant that it had three critical areas that it needed to concentrate on for it to well up in the Malabo Declaration.
Currently, SA was the Chair of the African Union’s (AU) Specialised Technical Committee (STC) on Agriculture, Rural Development, Water and Environment. Minister Thoko Didiza as the Chair of this STC called for a meeting of all African Ministers where the impact of COVID-19 was looked at. From that meeting there was a declaration that was signed, and that declaration led to the formation of a task force that was looking at the impact of COVID-19 on the continent. On 27 July 2020, the Minister would convene a meeting for Ministers of Agriculture, Trade, and Commerce to look at the issues around investment, financing, trade, and agriculture relating to COVID-19. This was the work that was being done around the Malabo Declaration under Minister Thoko Didiza as the Chair for the next two years.
The Department had also been conducting a rapid impact assessment of COVID-19 in South Africa and this was one element it would be utilising to prop out its inputs in terms of Malabo Declaration, specifically on ending poverty by 2025.
He said that the Department of Agriculture, as soon as the hard lockdown was put in place, had been a member of the National Joint Intelligence Structure of Government (NATJOINTS) that fed into the Coronavirus Command Centre. The Department ensured that during that period, agriculture was not greatly impacted by the lockdown and it was currently ensuring that all elements of agriculture were being discussed. The Minister had committees that she chaired regarding inter-actions with the industry and recently she had an interaction with the liquor industry around the issues of the alcohol ban.
The Department’s Acting Director-General (ADG), Ms Rendani Sadiki, said the cut had taken R300 million from the Department’s CoE. The impact of this was that the Department would not be able to fill critical posts when they become vacant. There were vacancies that were vacant before the cut. The problem was that due to the majority of the time, these jobs necessitated quite a lot of competent skills for the Department to deliver on its mandate, hence the Department being affected negatively by this budget cut. However, in the next financial year budget, the Department believed that it would be able to fill the critical posts.
The ADG, on whether the Department had a contingency plan to catch up in the future, responded that the Department’s understanding from the National Treasury was that this was a once off-budget cut. So the Department was anticipating that in 2021 it would go back to the normal budget in order to implement its programmes as originally planned in the five-year strategic plan as tabled.
The Department had received from the Presidency through the presidential employment stimulus and it did believe that the funds would help some small farmers who fell through the cracks and did not qualify for the COVID-19 disaster fund where they were providing inputs to smallholder farmers. The Department had agreed with the Presidency that it would prioritise those who had fallen through the cracks. About 55 000 farmers had applied for this stimulus package and just over 15 000 qualified. This meant that were about 40 000 farmers that the Department needed to take care of. That work was being done with the provincial department of agriculture.
Concerning whether the Department had a provincial breakdown of this, he held that the Department had only recently met with the Presidency to get formal feedback on this budget allocation as it had not yet been confirmed by the National Treasury. The Department would meet with the provinces during the following week to plan on how to prioritise the allocation of this money. The DALRRD would apply the criteria that it applied for the COVID-19 disaster fund where it would prioritise 50% of women, 40% of youth, people with disabilities, and military veterans. The Department would only be able to provide the provincial breakdown once it had met with the provinces.
He said that on 20 July 2020 the Department had met with VinPro as well as small and big wine producers. The Department presented its case to the Minister and the Minister was going to be taking the matter up with the relevant Ministers in the economic cluster such as the Tourism, Trade and Industry, Competition and Health, so as to examine the impact on the recent announcement of the alcohol ban, on the wine industry. The Department was aware that the small wine farmers were going to be largely affected as they depended on tourism and were now likely to go under due to the circumstances. He said that he would also talk with other relevant DGs to see if they could come up with a proposal that would go up the system.
The Department had done an extensive amount of work on NATJOINTS. Agriculture, unlike many other sectors, was classified as an essential service. However, there were some glitches as the police were trying to enforce the lockdown. So some areas were affected, including, for example, the transferring of goods. The Department was working hand-in-hand across the board to bring to the attention of the police, NATJOINTS and Ministers responsible for those sectors.
On the issue raised by Mr Marais, he indicated that some areas have been transferred and some were still to be transferred; some areas would not be transferred.
The Deputy Minister, Mr Sidumo Dlamini, on whether the Department could guarantee the jobs in the future for those that were losing jobs at the moment, said that it was the work that departments must all focus on and do the things that were supposed to be done to serve jobs and to ensure that there would be alternatives for those who would lose their jobs.
Mr Smit expressed that he was very worried about the future, especially when he heard the Department saying that these cuts were going to be temporary and that in 2021 everything would be back to normal. He said it was like approaching the future like an ostrich with its head in the sand hoping that things would get better. The economy was retracting the worst ever and this meant less tax for the government. This was not a short-term issue; the impact was going to last for at least two to five years.
He asked for a projection of the expected job losses within the agricultural sector. He asked the Department to do a study on this and the necessary mitigation plan, and then do a presentation on this to the Committee at a later stage.
Mr Marais said that he was not talking about urban but about rural.
Ms Ngwenya asked what the plan of the Department was for responding to the LAMSA judgement. She also asked how the Department would deal with the 1998 lodged claims.
The Deputy Minister said that the matter of job losses was rife and at the beginning of the year, the sector lost 21 000 jobs and it was now looking at the effect of the COVID situation and the labour force would give the numbers but job losses were happening in the sector. However, the Department was working hard to try and avoid that.
The ADG held that Mr Smit was correct in saying that the crisis was going to be an enduring one for over a while. But what the Department was asked by the Members was whether the budget cut was going to be recurring. As a result, the Department responded based on the answer which it was given by the National Treasury. It was not based on the delegates’ ignorance of the economic crisis that the country was currently facing as they were very much aware of that.
Ms Ntloko-Gobodo, on the LAMSA judgment, held that the Constitutional court in 2018 gave a judgment on the new order claims that were lodged from 2014-2016. These were claims made under the Restitution Amendment Act where Former President Jacob Zuma had opened the restitution process to allow for claimants, who had not lodged before the cut of date of 1998, to lodge new claims. The LAMSA took the government to the ConCourt to ask that these be put aside so that old claims could be settled first. In 2018 there was a final judgment saying that The Commission of Restitution on Land Rights must focus on the old claims and that it should provide a report to the land claims court every six months on the progress it made towards finalising those old claims. The new claims were interdicted, meaning that the Commission was not allowed to deal with them. The Commission had since submitted two reports as per the judgment, giving the court an update on the progress in terms of how it intended to settle the old order claims. The APP that the commission represented, including the adjusted APP because of the impact of the COVID-19, was part of the 1998 land claims. So the Department were continuing to deal with the land claims that were lodged in 1998 but it had to adjust its targets downward because of budget cut and COVID-19 environment.
Mr Marais was asked to write to the Department about his concerns and the Department would submit its response in writing.
The Chairperson said that the Minister should write a review about the 1995 White Paper on agriculture to reflect the new Department and national priority areas. An international issue, specifically climate change, would help to guide future operations of the Department – in the reprioritisation of the budget and critical areas that needed to be prioritised.
The Department should work to utilise the budget and the market access to ensure food security and employment of farmers were not affected.
The Department should also consider the impact based on the intervention which would assist the Committee to determine the impact budget allocation and areas that had been affected and needed to be addressed. She added that whenever there was a budget cut, the Department should prioritise the rural areas, especially in the provinces that relied on agriculture driven by emerging farmers.
Some land was in the hands of traditional leaders but belonged to the government. She asked the Department to ensure that the land was transferred to the traditional authorities so that the communities could utilise the land.
Lastly, she urged the Department that as soon as the next budget was set, it should fill up the critical vacant posts.
In closing, the Deputy Minister thanked the Committee and encouraged Members to continue working together with the Department. He said that the Department had just merged and the process had been a difficult one, but things would improve.
The Committee adopted minutes from its previous meetings.
The meeting was adjourned.
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