The Portfolio Committee on Agriculture, Land Reform and Rural Development convened virtually to receive a briefing from the Department of Agriculture, Land Reform and Rural Development (DALRRD), and the Agricultural Produce Agents Council (APAC) on the national fresh produce markets. Specifically, the discussion was on the market profile of the agricultural value chain as well as the socio-economic impact assessment study report on the Agricultural Produce Agents Amendment Bill. The Deputy Minister was in attendance.
The Department reported that there were 23 operating national fresh produce markets (NFPM) split into four categories, with 3.4 million tons of fresh fruit and vegetables being sold and a turnover of R17 billion in 2017. Johannesburg, Tshwane, Cape Town and Durban markets were the leading fresh produce markets with combined turnovers of 82%, followed by medium markets which are Springs, Bloemfontein, Pietermaritzburg, Port Elizabeth and East London, which had combined turnovers of 12% in the market. Smaller markets include Mthatha, Witbank, eMalahleni, Sol Plaatjie and Welkom, and they had six-percent market shares. The Department also outlined the categorised markets as determined by the Department and how the markets operated, including the commission fees of 5-7.5% charged on turnover per sale, five percent charged by municipalities and 12% incurred by farmers.
The Department, on the work it does, said that partnerships have been formed with other departments and the fresh produce industry to improve operations and service standards of NFPMs in the country. Producer bodies have also been involved in the process.
Members thanked the Department for the presentation and said that there are municipality problems that need to be addressed because the first produce comes from municipalities. They asked the Department how the Committee could assist to prevent the collapse of the fresh produce market
The Chairperson asked the Department to indicate whether there is a relationship between the volumes of agricultural produce and the existence of operational fresh produce markets, including the list of provinces that produce the largest volumes of fresh produce and whether they are operational.
The Agricultural Produce Agents Council indicated that it reports to the Minister once a year through an annual report, which is available on its website. The Council’s performance highlights for 2019/2020 included the growth of the fidelity fund from R23 million to R38.8 million; saving over R833 306 from free marketing exposure; 28 years of unqualified audit opinions; 910 regulated fresh produce agents; effectively regulating the fresh produce industry in excess of R18.2 billion per year; collaboration with the various organisations and the Department to address biosecurity and animal health at livestock and game auctions; staff complement of seven, among others.
The Committee welcomed that the Council regulates 910 fresh produce agents and the regulation of the fresh produce industry in excess of R18.2 billion per year, especially with a history of having an unqualified audit for 28 years through private audits.
The Committee welcomed the Project Rebirth of the national fresh produce markets, which is a key public marketing infrastructure for food security and local economic development. It is a collaborative effort between the government and the fresh produce industry to improve and revive its operations and service standards throughout South Africa.
However, the Committee heard that municipalities were not doing their part to plough back five percent of the revenue generated from these markets for the maintenance and development of the fresh produce markets. In many instances markets are dirty with dilapidating infrastructure and without management capacity by the respective municipalities. Therefore, the Committee will call for an intervention from the Department of Cooperative Governance and Traditional Affairs for assistance. The Committee also heard that there was no overarching act to support these markets, which fall under the municipal by-laws. However, the DALRRD must ensure that legislation in this regard is developed.
Opening Remarks by the Chairperson
The Chairperson officially opened the virtual meeting and welcomed everyone present, including the Members, support staff, Deputy Minister and officials from the Department of Agriculture, Land Reform and Rural Development (DALRRD). The Chairperson said that there is a cause for celebration since lockdown alert level one was recently announced but vigilance needs to be practiced to avoid another wave of COVID-19 that would have another high number of deaths. He introduced the agenda.
The two presentations on the national fresh produce markets (NFPMs) and by the Agricultural Produce Agents Council (APAC) are relevant to the history of the country. 1 March 1510 marked the battle of Salt River between the Portuguese and the Goringhaiqua Khoikhoi clan. There was trade between the D'almeida and the Goringhaiqua clan in the area until the D’almeida sailors attempted to steal cattle from the KhoiKhoi. The D’almeida then took revenge on the KhoiKhoi who chased them away after attempting to steal their cattle; the Portuguese soldiers seized children and cattle. The defeat of the Portuguese by the KhoiKhoi led to the Dutch and British expanding their colonial projects on agriculture in South Africa. The presentations play a role in the outlet of agricultural products for local markets, providing employment, creating a mainstream in the agriculture economy; unlocking training opportunities, contributing to local food security, expanding access to quality products and stimulating local economies. The APAC demonstrates how far the country has come since Europeans wanted to export the agricultural produce of the country. The measures that were suggested in the last presentations indicate the health of the South Africa’s agricultural exports and the need for the regulation of agents. The Chairperson said that the deliberations in the meeting should be guided by the knowledge that agriculture was already established in the Cape before the colonial project began and that the agriculture sector is linked to the struggle for land reform and rural development. The Committee has the responsibility to advance this agenda even though the full history is unknown. “The brave warriors who defended their property must be remembered as the first heroes in the land and the struggles of our history must be defined accordingly.”
The Chairperson handed over to the Deputy Minister for his opening remarks.
Deputy Minister of Agriculture, Land Reform and Rural Development – Rural Development, Mr Sidumo Dlamini, thanked the Chairperson for his opening remarks and said that it was important to remind South Africans of their journey on how far agriculture goes back in history. The Department will do its part to ensure that South Africans see the value and the benefits of being in the country.
The Deputy Minister thanked the Committee for the opportunity to present, before handing over to the Department officials for the presentation.
Briefing by the Department of Agriculture, Land Reform and Rural Development (DALRRD)
Mr Mooketsa Ramasodi, Acting Director-General, Department of Agriculture, Land Reform and Rural Development (DALRRD), outlined the Department officials who would be delivering the two presentations and said that the socio-economic impact assessment was conducted by the Department of Planning, Monitoring and Evaluation and it will be forwarded to the Committee along with the Market Profile document so that the Committee could engage on the documents before deliberating on the Amendment Bill.
Mr Stanford Manthata, Deputy Director: Marketing Infrastructure and Agro Logistics, DALRRD, said that the presentation is aimed at providing background on the progress of the Department concerning the state of the NFPMs in the country and the measures that have been taken throughout the years in addressing the issues of the NFPM. He said that the NFPMs are important because they serve farmers and are a public marketing infrastructure key for food security and Local Economic Development (LED). The NFPMs are owned by the state and are used by the Department to play a role in the value chain. The roles of the NFPMs were outlined as:
- To provide low-cost marketing channels for farmers
- To provide training facilities for the fresh produce industry stakeholders
- To provide an outlet for large vegetable and fruit buyers
- To act as suppliers to hawkers
- To form a price forming mechanism
- To provide revenue for municipalities;
He outlined that there are 23 operating NFPMs split into four categories, with 3.4 million tons of fresh fruit and vegetables being sold and a turnover of R17 billion in 2017. He said that Johannesburg, Tshwane, Cape Town and Durban markets are the leading fresh produce markets with combined turnovers of 82%, followed by medium markets which are Springs, Bloemfontein, Pietermaritzburg, Port Elizabeth and East London, which had combined turnovers of 12% in the market. Smaller markets include Mthatha, Witbank, eMalahleni, Sol Plaatjie and Welkom, and they had 6% market shares. He outlined the categorised markets as determined by the Department and how the NFPMs operated, including the commission fees of 5-7.5% charged on turnover per sale, 5% charged by municipalities and 12% incurred by farmers.
On the work done by the Department, he said that partnerships have been formed with other departments and the fresh produce industry to improve operations and service standards of NFPMs in the country. Producer bodies have also been involved in the process. He said that project rebirths were established because of:
- Declining service standards
- Municipalities not reinvesting revenue into the markets
- Continued physical infrastructure deterioration
- Non-conformance to food safety and health standards
- Poor management capacity in most markets
- The absence of standard operating procedures (SOPs)
- Poor information management systems
- Out-dated markets by-laws. Poor compliance and absence of service-level agreements (SLAs)
- Section seven investigations on the challenges in the markets by the NMC
On the key interventions, he said that the Department developed a code of how best to guide implementation in the markets, and an extensive consultation was held with key role stakeholders where a five-phase approach was formulated to help the markets. This approach involved:
- Diagnostic Phase
- Implementation Phase
- Facilitation of Implementation of the Codes
- Utilisation of the Scorecard
- Municipality Engagement
Other key interventions by the Department were:
- Collaboration with municipalities
- Municipality and public investments into markets
- Establishing a mentorship programme
- Instituting an investigation on ethical trading in the NFPMs
- Collaboration with the Department of Cooperative Governance and Traditional Affairs (COGTA)
- The drafting of the Bill on the NFPMC
Mr Manthata outlined the recommendations and way forward to address the challenges and issues raised.
Briefing by the Agricultural Produce Agents Council (APAC)
Mr Francois Knowles, Chief Executive Officer (Registrar), Agricultural Produce Agents Council, outlined the need for the regulations and the background of APAC. The mandate of APAC is to:
- Regulate the occupations of fresh produce, export and livestock agents.
- To protect the interests of farmers
- To maintain and enhance the status and dignity of those practicing the occupation as an agent for fresh produce, exports and livestock
- To protect the interests of agents
The representation of the council members was outlined and Mr Knowles. He said that the Minister made appointments in the council for a period of three years. The APAC legislative framework was also outlined on the legislation that governs APAC, the Agricultural Produce Agents Act (Act 12 of 1992) and the Agricultural Produce Agents Amendment Act (Act 47 of 2003).
The code of conduct for agents to follow was highlighted. On the current protection of farmers, he said that trust accounts exist, as well as a fidelity fund for losses due to theft and fraud, a disciplinary tribunal for disciplinary hearings and the powers of the disciplinary tribunal. He mentioned that the three-year period strategic objectives are:
- To continue with existing regulatory activities.
- To consider aspects that are required in the Act that can be amended
- To have representation of exporters on the council
- For APAC to ensure a level playing field in transformation
- To expand and grow the APAC marketing plan.
He outlined the operation focus of APAC, which is to:
- Ensure agent registrations
- Ensure annual fees, fidelity fund contributions and guarantees
- Trust reconciliations and audit reports
- Position APAC to contribute to development and transformation
- Conduct 18 training sessions with the Department (DALRRD)
- Create online learning portals for agents
- Project rebirths for fresh produce markets
He said that APAC reports to the Minister once a year through an annual report which is available on the APAC website. The APAC performance highlights for 2019/2020 included:
- The growth of the fidelity fund from R23 million to R38.8 million
- Saving over R833 306 from free marketing exposure
- 28 years of unqualified audit opinions
- 910 regulated fresh produce agents
- Effectively regulated the fresh produce industry in excess of R18.2 billion per year
- The introduction of the Guide for Registered Auditors
- Collaboration with the various organisations and the Department to address biosecurity and animal health at livestock and game auctions
- Staff complement of seven
Department of Agriculture, Land Reform and Rural Development (DALRRD)
Ms M Tlhape (ANC) applauded the Department for considering the recommendations made by the Committee and including them in the presentation because the Committee can track progress and transformation.
On the market agents’ commission charge of 5-7.5%, municipal charges of 5% and farmer incurred charges of 12% she asked if the farmers are not being double charged. Through the local economic development municipalities are supposed to support the farmers not double charge them. She asked what the Department was doing to intervene and what the perspective of farmers is on the charges.
On the key interventions, she highlighted that the phased approach does not include timeframes and she asked when the intervention project would begin. She also asked why stakeholders need to sensitise the Minister on the importance of establishing the NFPMC and whether the Minister cannot see the importance of the establishment of the NFPMC. She asked if the farmers are involved in the process of establishing the NFPMC.
Ms A Steyn (DA) asked what the current oversight role that was played by the Department in the NFPM was and asked for the current staffing and function of the Agricultural Produce Committee.
On the public–private partnerships (municipally owned but privately operated), she asked for an explanation on which of the partnerships are working best in the markets and asked for further details on how they function, especially in rural areas. She also asked if fresh produce markets would be included in the new proposal.
Mr S Matiase (EFF) asked within which legislation fresh produce markets operate. Are they under Agricultural Produce Agents legislation, or is the industry self-regulated.
Mr N Capa (ANC) welcomed the informative presentation by the Department. He asked for clarity on the assistance that the categories provide for farmers and hawkers who transport their products – whether there is a reduction of cost to assist farmers in this process of marketing. He also asked what would happen to products that have not been sold and whether there would be defects with the products.
He also raised concerns that the Department is not increasing its contribution in fighting unemployment, poverty and inequality and suggested that the Department develops measures to address the issues.
Ms N Mahlo (ANC) asked on how the revival of the fresh-produce industry to improve operations and service standards of NFPMs, whether the operational policies and procedures of the small entities would be evaluated to ensure that they qualify in the markets and if the Department will assist with the policies.
Ms T Breedt (FF+) thanked the Department for the presentation and said that it provided clarity on the NFPM’s. On the rebirth and revival of the fresh produce markets, she asked what the timeframes are and how the fresh produce markets have been prioritised.
On the cost breakdown per market, she asked how the report would be funded and who would be responsible for the cost of improvement. She noted that Mr Manthata mentioned that certain markets are assigned to assist other markets and asked for clarity on the statement and whether there are markets that are not fulfilling their function of assisting markets. She also asked on the form of assistance that is provided, whether it is financial or knowledge based.
Inkosi R Cebekhulu (IFP) asked whether the smallholder and social farmers are paid upfront when produce is delivered or if it is done at the end of the month. If it is month end, he asked whether those receiving the produce observe the payment rule of 30 days. He said that in some areas the produce farmers sell to individuals in bulk and then the individuals go to the produce markets and sell the produce as their own.
Ms T Mbabama (DA) thanked the Department for the presentation. On the statement made that 60% of hawkers buy from fresh produce markets and the importance of these hawkers, she requested further details on the business conducted by the hawkers, including the commodities that are bought by the hawkers. She said that it seemed as though the hawkers are competing with large buyers and asked whether there are in-built discounts for the hawkers as a form of support to the small-scale entrepreneurs and any discounts in commission. She asked whether the same commission of 5-7.5% is charged to large and small-scale farmers. Finally, she asked for clarity on the Section seven investigations and who the mentorship programme was aimed at.
Mr N Masipa (DA) thanked the Department for the presentation and said that there are municipality problems that need to be addressed because the first produce comes from municipalities. He asked the Department how the Committee can assist to prevent the collapse of the fresh produce market and asked for details on the situation at the Pretoria fresh produce market. He said that fresh produce is primarily dependent on functioning municipalities and that the Ministers of DALRRD and COGTA need to come together to address the issues because if not it will affect the rate of transformation in the sector.
The Chairperson asked the Department to indicate whether there is a relationship between the volumes of agricultural produce and the existence of operational fresh produce markets, including the list of provinces that produce the largest volumes of fresh produce and whether they are operational. The Chairperson noted that the Department highlighted that for the APA Amendment Bill, public hearings were only held in four provinces: Gauteng, KwaZulu-Natal, Limpopo and Western Cape. He asked whether the fresh produce is mainly sourced from the four provinces and for the details of the actual volumes that are produced in each of the four provinces for different commodities.
Agricultural Produce Agents Council (APAC)
Ms Tlhape appreciated the presentation and linked it to the presentation on the Amendment Bill. She said that the presentation on the Bill indicated that one of the reasons for the amendment is to include livestock agents because the focus has been on the fresh produce. If the Bill seeks to include livestock agents, what has been the situation of the livestock agents?
She noted that the APAC is self-funded and asked how they the fidelity fund is regulated. She said that the objects of the Bill provide for financial statements to be audited by the Auditor-General of South Africa (AGSA) and she asked if the APAC is satisfied with being regulated and audited by the Auditor-General (AG).
On the trust accounts, she asked what the current situation is because the amendment Bill seeks to make provision for the establishment of the trust accounts. Would there be an issue if agents use business accounts instead of the trust accounts? On the Minister approving the annual business plan and strategy of APAC, she asked what the current situation is.
Ms Steyn asked on the dispute system in place if people have any complaints and disputes on payments and she said that price is established on quality and availability in the market. She asked what the role of the agents is to ensure that farmers are advised on when to bring their produce to the markets in order to sell at a better price. During the lockdown period, produce could not be sold. She asked if produce could be moved closer to communities because the produce is harvested in the communities and taken to markets to be sold by hawkers. Smaller markets could be created for nearby communities. The Committee need to go on an oversight visit to Mooketsi market.
Mr Matiase said that both the presentations by the Department and APAC did not answer his question on the regulating legislation for the fresh produce markets. He re-asked the question on the legislation that regulates the NFPM. On the primary and secondary focus of APAC being the interests of the farmers and the agents, he said that there is a double-loop system and asked where and how the public interests are served because APAC did not mention anything about looking after the interests of the public. He asked if the interests of the public are provided for in the legislation under APAC, if not, he said that the Bill should be amended for the interests of the public.
Ms Mahlo welcomed the presentation and said that APAC is an umbrella of all smallholder markets. She said that the APAC presentation did not mention anything on the administration policies that would assist the Committee in understanding the occupational health and safety procedures, financial management policies and procedures as well as the procurement policies. She asked what the SLA is between the APAC and smallholders in the markets and whether there is a policy for fees in the markets. She asked how the issue of assessments is addressed, who comes into the market as a small holder, whether there is a policy in place for grievances in case the smallholders are unhappy with not meeting the entry requirements as a smallholder.
Mr Masipa indicated that the question on the Tshwane market was not responded to and highlighted that Farmers Weekly reported that the Tshwane market is in a bad state compared to other markets; Fresh Plaza reported that the Tshwane market was on the brink of collapse and Food for Mzansi reported that the Tshwane market is set to reopen. He asked what the situation at the Tshwane market is. Is it operating and what is being done to ensure that the market goes back to normal?
He also asked what happens when the municipality fails to comply with the regulatory requirements; is the market closed and are there any engagements? He suggested that in order to successfully transform the market, an incubators programme is necessary to ensure that up and coming markets are educated on the industry so that they do not suffer once they are in the industry.
Ms Breedt asked if APAC foresees any challenges with the amendment Bill and if there will be any financial constraints or changes. On the fidelity fund, she asked if there are any outstanding claims or litigation matters that are still being addressed on funds that still need to be paid out and what are the matters.
The Chairperson highlighted that the questions on whether is a relationship between the volumes of agricultural produce and the existence of operational fresh produce markets, including the list of provinces that produce the largest volumes of fresh produce, and whether they are operational; if the fresh produce is mainly sourced from the four provinces and details of the actual volumes that are produced in each of the four provinces for different commodities.
The Chairperson said that during the presentation by the Department, the Socio-Economic Impact Assessment (SEIA) was submitted and asked whether the Bill would be presented to the Committee.
On the APAC presentation, the Chairperson said that APAC’s primary focus is to protect the interests of the farmer but out of the 18 members who form the APAC only four are farmers and half being agents. The Chairperson asked if this representation would be corrected when the Bill is amended.
Department of Agriculture, Land Reform and Rural Development (DALRRD)
On the incurred charges of 12% by farmers, Mr Manthata said that the fresh produce markets and agents both provide a service and rely on the fees. When farmers deliver their produce it must be off-loaded, put in cold rooms and moved to a platform where the produce will be sold. This process has expenses, with expenses such as electricity and other costs, which are incurred and must be compensated. The agencies are also responsible for selling produce on behalf of the farmer, so they also rely on the fee paid by farmers.
On the implementation of the five-phase approach, he said that the Department may have taken on more responsibilities than it can handle because as the legislation stands the Department responsibility is to deal with the regulation of trading on the market floor but the majority of work that has been done by the Department has been focused on the operations, which is why timelines for implementation cannot be included. The Department has no control over the management and operations of municipalities.
On sensitising the Minister, he said that it becomes necessary to update the Minister on the challenges that are being experienced. The Minister is aware of the issues and previously Sections were established because of the knowledge the Minister had.
On the role of the farmers in the markets, he said that the Department relies on the commodity earnings, which is why there is close interactions with Potato South Africa, Fruit South Africa and black producer representatives. The organisations could provide the perspective of a producer during the drafting of the codes of best practice.
On the public–private partnerships, he said that each model has its own advantages and disadvantages and that there is no model that works better than the other. It becomes difficult to prescribe one model to a municipality because progress in municipal departmental options depends on the relationship the market has with the counterpart municipality. If the relations are not good, then there is a problem when procurement needs to happen.
On the issue of the Mooketsi market, he said that farmers, ZZ2 and agencies established the market where an operation company was formed to run the market. The issue is that when there is one farmer in charge and one agency there are issues with market access because the farmer would want their produce to get preference and the agent would want competition to operate on their own terms.
On the oversight role of the Department, he said that the Department’s role is to ensure that processes are done through APAC and the standards Act so that produce that is sold in the markets meets the safety requirements and regulations. The Department is not responsible for the day-to-day operations in the markets but the municipality is. On the legislation that oversees the fresh produce markets, he said that the industry is not self-regulated and that it is governed by the Acts under the trading aspects; the rules of the by-laws under the municipalities are also being used to regulate the markets as well as the municipal acts such as the Municipal Structures Act, the Municipal Systems Act and the Municipal Finance Management Act, which are being used to regulate.
On the assistance of farmers who transport their produce, he said that the Department does not offer assistance but upholds a regulatory mandate. He said that some municipalities do offer assistance but not willingly. On the revival of the fresh produce industry, he said that the revival has to do with ensuring the standardisation of the markets, especially issues that have received attention such as infrastructure, conducting operational aspects and uniformity. The municipalities should not be left to resolve the issues.
On the timeframes for the revival and rebirth in the industry, he said that if all the legislative challenges can be resolved it would help the Department prioritise the issues that need to be resolved. The Department is not in a position to attach timeframes.
On the payments for produce, he said that farmers are not paid upfront but after their produce has been sold and said that the trust that was formed by the agencies is where all the money is placed to pay the markets and the farmers.
On the issue raised that individuals sell produce that was bought in bulk, he said that it is an issue that has been forwarded to the Competition Commission for further investigation because it is popular in the Durban markets and it increases the price of the produce.
On the matter of the hawkers, he said that the agency and the hawkers normally negotiate the matter of discounts and it is based on demand and supply. On the Section seven investigations, he said that the industry approaches the Minister and the Minister requests the NMC to investigate the issues that have been brought forward, especially on the operations and sustainability of the markets. The NMC has reported back to the Minister on three occasions and the reports are available and can be forwarded to the Committee on the findings of the investigations.
On the mentorship programme, he said that there were challenges in the markets on the procedures of the produce and there were discussions on how smaller markets can be assisted on how to deal with products and updating of by-laws.
Agricultural Produce Agents Council (APAC)
On the Section seven investigations, Mr Elvis Nakana, Deputy Director: Commodity Markets Analysis, DALRRD, said that the investigation reports come from committees that were established in terms of section seven of the Marketing of Agricultural Products Act, if there was a need for an enquiry.
On the public hearings on the Amendment Bill and the volumes produced in the respective provinces, he said that in Gauteng, which has the two largest produce markets, there is a lot of produce that comes from neighbouring provinces and said that once the final details on the statistics of the matter have been concluded they will be forwarded to the Committee.
On inclusion of the livestock agents, Mr Knowles (APAC) said that there are no fidelity funds so there is no certainty that all farmers are paid on time and that the fidelity fund ensures that there is fast payment. On the submission of the business plan and strategy by APAC, he said that the business plan includes the budget for the next financial year and it provided to the 18 council members. Once finalised the plan is forwarded to the Department.
On the involvement of the Auditor-General in the APAC, he said that it is a good idea but not to audit the books of APAC but to ensure that the work of APAC is conducted properly. On the challenges with payments, he said that APAC goes into a process of consultation and involved parties are given an opportunity to present their cases. If a solution cannot be reached, the legislative framework is involved, which then leads to court appearances.
On the role of agents, he said that their role is important because agents communicate with the farmers on the supply and demand in markets and admitted that sometimes agents do not always communicate with farmers. Agents have a legal obligation to communicate with farmers in a span of three days if produce is not sold and when there is a low supply in the country to avoid markets being flooded and low price charges. On the suggestion to move markets closer to communities, he said that the cost implications for communities travelling to buy produce needs to be corrected and said that urban gardening is an alternative for communities to grow their own produce free of charge. He said that through urban gardening, communities could start business and make profit. Urban gardening initiatives will not compete with fresh produce markets but will expand the service offering to South Africans. Different options of feeding the nation need to be considered.
On the oversight visit to the markets, he said that APAC is willing to take the Committee to a large municipal market so that Members can see what happens in the markets and how the markets function as large entities. On the legislation governing markets, he said that the existence of markets is in the Constitution and that a legislation that governs the markets does not exist. The Municipal By-Laws are formulated from the municipalities.
On the primary and secondary focus of APAC being the interests of the farmers and the agents, he said that farmers are APAC’s primary interest because the farmer is being insured without being part of any legislation. The APAC legislation seeks to regulate the market agents, livestock agents and export agents. There are two consumer representatives in the council.
On the administration policies, occupational health and safety procedures, financial management policies and procedures and the procurement policies, he said that APAC has all the policies in place and said that anything more than R10 000 cannot be signed off. He emphasised the importance of a regulatory body being ethical. APAC basically provides insurance to farmers free of charge. On the Tshwane market, he said that the market is functioning but not in the desired way. The market is dirty; it is not conducive or well maintained. There is also no money coming from the municipalities and the market requires more staffing. The market does not have enough security so farmers do not leave their produce to be sold; hygiene is poor in the market and the management of the market is not consistent. The fresh produce markets need to be restored to their former glory and fulfil their purpose.
On the entry of new smallholder farmers, he said that it is not easy for a farmer to enter the agricultural value chain but the entry should be smooth by equipping farmers with knowledge and understanding of the sector.
On the foreseeable challenges of the Amendment Bill, he said that finances and staff will be required to deal with the trust accounts and setting up the fidelity fund. APAC functions well and hard work is vital. On the outstanding claims and litigations, he said that there are no outstanding claims or litigations. In November 2018, three market agencies were closed down because they had deficits in the trust accounts because they were stealing from the farmers. The agencies were taken through a disciplinary tribunal process and through this process APAC had to pay claims up to R3 million. APAC then liquidated all the role players and a legal criminal case was opened at South African Police Services (SAPS). All avenues will be exhausted to ensure that unethical agencies are brought to justice. There are continuous disciplinary tribunals and rules are applied. He said that APAC conducts criminal vetting before appointing someone and that all legal matters are included in the APAC annual report.
Mr Ramasodi said that the SEIAS was conducted in 2017 and it should have been submitted with the Bill. He apologised for the delay in forwarding the assessment. He said that the 24-page document highlights the challenges in the Act and that presenting the document would be futile because the Committee would not have read the document thoroughly. The document looks at the various social-economic impacts.
On the volumes of fresh produce in the respective provinces, he said that the discussions are based on the areas of aggregation that deal with just over 44% of what is produced in the country; the others would be distributed through sales and those that go through processing. The 44% goes through four markets, with Johannesburg and Tshwane markets taking up the bulk and Cape Town and Durban taking up just under 10%. But the produce does not necessarily come from these four markets. He said that the Department, through engagements with Statistics SA, conducted statistics on commercial agriculture, which highlights where the produce comes from. Statistics SA can come to the Committee to present the information or the document could be forwarded to the Committee.
On the legislation regulating the markets, he said that there are a few legal issues that needed to be looked at on the interests and protection of rights and that the current legislation will be able to protect these rights. On the responsibilities of the Department, he said that there is no Act.
On the incubator programme, he said that the programme could be initiated, especially in ensuring best practice, trial sites and the inclusion of private markets. He said that the national legislation sets the minimum standards and in every market there is a set minimum standard but in private markets there are private standards.
On the livestock inclusion, he said that livestock agents were included in the Bill before the amendment but the amendment is based on how the systems are regulated. He said that there are issues that need to be outlined on the SEIAS’ and that there are issues that need to be addressed in the fresh produce markets. If there are any other issues that have not been addressed, the responses will be forwarded in writing. He indicated that the Statistics have been presented to the respective Members of Executive Councils (MECs) and the Minister.
The Chairperson thanked the officials of the Department, the entities present and the Deputy Minister for the engagements and released the team.
Consideration and adoption of meeting minutes
The Committee adopted the minutes of 16 February 2020 and 23 February 2020.
Mr Matiase recounted that on 10 November 2020, Parliament passed the motion for the establishment of a joint committee on investigation to investigate the living and working conditions of farm workers, and timeframes were outlined on when the investigations should happen. He asked on the status of the joint committee preparations.
The Chairperson said that joint meeting has been scheduled for Friday, 04 March 2021, between the Committee and the Portfolio Committee on Labour, but the latter has other meetings scheduled. A timeline has been provided until 30 November to conclude in preparation for the investigation. Key activities will be scheduled for the Committee and divided into four phases:
- Phase one would focus on scanning and mapping of the terrain and associated with key interventions; the scope will have to be defined, and an approach be decided on. Documentation and consultation will then follow. Phase one should be between March and April.
- Phase two would focus on the problems, actions and outcomes. Key interventions would be briefing sessions by the respective departments, round table discussions with stakeholders and an oversight visit as well as public hearings. Phase two should be between July and September.
- Phase three would focus on synthesis and recommendations on the findings, enforcement of legislation and policy review. Phase three should be between October and early November.
- Phase four would focus on reporting to the National Assembly and to ensure that the report is adopted and tabled for consideration by the National Assembly by the 30th of November 2021.
The Chairperson said that the matter of the engagements for the joint sitting is still being discussed. He then thanked the Members present for their attendance.
The meeting was adjourned.
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