Document handed out: National Red Meat Development Programme Business Concept [awaited]
The Committee met with the national task team of the Customs Feedlots Organisation, together with representatives from the Department of Agriculture, Land Reform and Rural Development (DALRRD), the Agricultural Research Council (ARC) and the National Agricultural Marketing Council (NAMC) to receive a briefing in a virtual meeting on the crisis in the rural custom feedlots of the Eastern Cape, Kwazulu-Natal and the North West province.
The Customs Feedlots Organisation said that the major challenge was that the programme for feedlots had been suspended in September last year, with the hope that the ARC would take over in October. However, since October until now, they had made every effort to ensure that the programme was restarted, but unfortunately a number of cattle had died and a number of workers who were employed at the feedlots were now unemployed. They requested a political intervention, because the programme was giving a bad picture of the government, where the infrastructure, the feed and the cattle were available, but there were no people to feed the cattle.
The Department said that the NAMC’s agreement with the Department had expired in September, but about six months before that, they had worked on a transitional plan with a view to transferring the coordination of the programme from the NAMC to a new entity, which was proposed to be the ARC. The transition plan was funded and was implemented until September, when the contract with the Department expired. Before that, as part of the transition plan, the NAMC had worked very closely with the ARC in order to come up with a plan going forward after September, and the plans had been approved. The reason for the changeover was that the Minister had looked at the NAMC’s mandate and given a directive that perhaps they should focus on the parts of the programme that fell within the NAMC’s mandate, such as marketing.
Given the fact that the transitional plan that the ARC and NAMC had put in place had been overtaken by events, they had had to review the plans. They had come up with a new plan, where the ARC was supposed to start from 1 April and take over the project for the coming three years, while an opportunity was going to be given to the NAMC to wind down the activities that they were involved in. The key activity of this plan was to continue on the enterprise development component of the project to ensure that by the end of the programme, the farmers had been capacitated and developed to operate at a commercial level. It was going to assist them to establish farmers' cooperatives, and look at enterprise development through the establishment of pastures.
The Portfolio Committee wanted to know if there was a budget for these feedlot programmes, and asked the ARC whether the custom feedlots had been consulted to make their input when the business plans were being drawn up, in order to ensure that the feedlots were run smoothly. A Member said that as much as the feedlots had indicated that they had problems, the managers of the feedlots needed to understand that when they were given the responsibility for certain things, they should not sit and look at being fed all the time. They needed to come up with alternative plans that would help them carry the work forward. The Committee advised that the feedlots must establish a quality management system which would have policies that allowed them to market themselves so that they could sustain themselves, even if the government could not.
The Chairperson welcomed Members of the Committee, the national task team of the Customs Feedlots Organisation, as well as the representatives from the Department of Agriculture, Land Reform and Rural Development (DALRRD) to the meeting.
He said that he would handover to Ms N Tlhape (ANC) to chair the meeting, as he had a family challenge that he needed to attend to, and added that he would stay online in the meeting as a participant.
Briefing by Customs Feedlots Organisation
Mr Mzimkhulu Jikijela, Chairperson: Eastern Cape Feedlot Association, said the major challenge they had was that the programme for feedlots had been suspended last September in the hope that the Agriculture Research Council (ARC) would take over in October. Since October, they had made every effort to ensure that the programme was restarted, but unfortunately a number of cattle had died and a number of workers who were employed at the feedlots were now unemployed. He added that they had made presentations up to the level of the Minister, but up to now there was nothing really happening. They had been promised that by February the programme would restart, and it was later stated that it would start in March, and then in April, but right now there was nothing happening at all. Mr Jikijela said that they were asking for a political intervention, because the programme was giving a really bad picture of the government, as the infrastructure, the feed and the cattle were available, but there were no people to feed the cattle. He added that the programme was good, as it had put food on the table for people and provided opportunities for economic development for the rural people who had no other option.
Mr Nopisi Sefatsa, Deputy Chairperson: Eastern Cape CPF Livestock Association, said that the support they had received from the National Agricultural Marketing Council (NAMC) included the payment of people at custom feedlots, the building of infrastructure at the custom feedlots, fairing of animals to auctions, and the general marketing of the custom feedlots. Custom feedlots were not commercially inclined, as they were made to relieve the stress on the commonages, as well as overstocking and overgrazing, so that the animals were brought to the custom feedlots to be fattened. They normally took them for at least 120 days, and in between, should they be marketable, they would sell them. It was only then that a donation of R1 000 was left with the feedlots, and the donations were not able to sustain the feedlot. The challenge now was that the NAMC had terminated its assistance, and had not informed the feedlots timeously of the termination. They had been told that the ARC would be taking over, but their view was that for the government to have put such massive infrastructure support into the custom feedlots, and also to have assisted the youth to find employment in the feedlots, this meant that the opportunity for those people to take something home had been terminated abruptly. The termination could result in the vandalising of the infrastructure.
The organisation felt that it was unfair that the contract had been randomly terminated without any information being shared with them so that they could form an exit plan to at least have the feedlots commercialised. They had been working with NAMC without a solid memorandum of understanding (MoU) with clear mandates, time frames or exit plans, to ensure the self-sustainability of the feedlots when the termination happened. Self-sustainability started from being able to plant one's own feed for production, because about 90% of the expenses at the feedlot had to do with buying feed which was readily available from external companies. If the feedlots could have their own lands to plant their own feed, then the feedlots would be in a position to be commercial. Their aim was for all the feedlots to have the proper infrastructure, which would include the tractors, the feed mixers, and lands where irrigation was possible, in order to ensure their self-sustainability.
Briefing by the DALRRD, NAMC and ARC
Mr Mooketsa Ramasodi, Director-General: DALRRD, said he would present on the processes of the National Red Meat Development Programme, and the ARC and NAMC would present on the real processes in terms of the scheme.
Dr Simphiwe Ngqangweni, Acting Chief Executive Officer (CEO): NAMC, said that the Committee would be familiar with the successes of the National Red Meat Development Programme, which was meant to respond to the needs of the livestock farmers inrural areas, as they had presented before. The idea was to start with the assets that the farmers already had, and look at the value that could come out of those assets for the benefit of their livelihoods and for the development of the rural areas. The programme had been successful over the years and had seen growth in terms of income generated in the rural areas in the Eastern Cape, KZN and the North West provinces.
The programme was benefiting from funding from the DALRRD, and NAMC was simply an implementing agency on behalf of the Department. NAMC’s agreement with the Department had expired in September 2020, and roughly about six months before that, they had worked on a transitional plan with a view to transfer the programme in terms of its coordination from the NAMC to a new entity, which was proposed to be the ARC. The transition plan was funded and was implemented until September 2020, when the contract with the Department expired.
Before that, as part of the transition plan, NAMC had worked very closely with the ARC in order to come up with a plan going forward after September, and the plans were approved. The reason for the changeover was that the Minister had looked at the NAMC’s mandate and given a directive that perhaps they should focus on the parts of the programme that fell within the NAMC’s mandate, such as marketing. The other aspects, such as the building of infrastructure and maintenance of the feedlot processes, would be the responsibility of a new entity, which was the ARC.
He said that the processes that unfolded, as facilitated by the Department from October last year, had not gone as planned, hence the challenges that had been experienced by the feedlots. The Minister had given NAMC a further instruction earlier this year to go back to the programme and finish some of the infrastructure work that had not been completed, in preparation for the take-over by the ARC. That was going to be a short-term intervention of about eight months to allow the ARC to settle in and then fully take-over after a period of time. The plan was put in place, but there were processes around legal arrangements, as well as supply chain processes, which had to be referred to National Treasury for further advice.
Prof Norman Maiwashe, General Manager: ARC, said that they had been brought into the scheme just before the expiry of the service level agreement (SLA) between NAMC and the Department. This was just before October 2020, so the ARC met with NAMC around July to develop a transitional plan that was going to take them from October until the end of the financial year on 31 March 2021. These were preparations to make sure that the programme would transition smoothly and seamlessly. They had engaged thoroughly on the plan, and what was left was the administrative issues to be sorted out from the side of the Department.
They had received feedback from the Department in terms of some of their processes that needed some approval, since the matter also involved the National Treasury, and they were brought into the fold again early this year -- around February -- where the Minister had issued a communication to NAMC giving them the go-ahead to proceed with finalising the outstanding activities to facilitate a smooth transfer to the ARC.
Given the fact that the transitional plan that the ARC and NAMC had put in place was overtaken by events, they had had to review the plans. They had come up with a new plan, where the ARC was supposed to start from 1 April and take over the project for the coming three years, while an opportunity was going to be given to the NAMC to wind down the activities that they were involved in. The key activity of this plan was to continue on the enterprise development component of the project to ensure that by the end of the programme, farmers had been capacitated and developed to operate at a commercial level. It was going to assist them to establish farmer cooperatives and look at enterprise development from the establishment of pastures.
The other component was around farmer advisory services, where farmer skills were to be improved so that from a technical point of view, they became astute animal production practitioners. In the plan, they were also going to add another component, which was about animal recording, and this was in alignment with other programmes that they ran with farmers at the smallholder level. This was to assist farmers with issues of stock tax, so that the animals were branded properly, they were recorded, and the necessary data was collected to support the business processes. The other component was to establish custom feeding centres, as there were centres that were still outstanding, but this was going to be looked at in terms of scaling up the project by bringing other livestock species into the fold. The programme had been primarily focusing on cattle, so they wanted to add an element of sheep, since in some of the areas, sheep was one of the predominant livestock species.
The other aspect, in terms of market access, was more about looking at both the formal and informal markets to ensure that farmers had an opportunity to market their animals off hand, and also to be able to use the custom feeding centres to feed their animals so that they could add value. The other element was to continue with the procurement of commercial feed while phasing in the planted pastures -- and this was the support that was very critical to the farmers. In terms of animal health, veterinary remedies were to be provided to the farmers and the necessary training was to be provided, driven mainly by Onderstepoort Biology Products (OBP), which was an expert in this area.
Another area that was added to the programme was human capacity development, which was aimed at both farmers and also those that were involved in the programme in providing labour. The ARC wanted to capacitate them so that the feedlots were managed in such a way that they were more efficient, and they were able to provide the livelihood that was needed. The human element was very critical, especially the involvement of youth. The ARC also wanted to look at information dissemination to ensure that farmers were capacitated regarding market prices and animal health recording and equipment, because livestock production was an integrated programme. The farmers needed to be informed in such a way that the breeding aspects were also taken into the fold. The other element of human capacity development was on capacitating para-professionals. The ARC was more interested in sustainability, and the understanding that they had gained by engaging with the NAMC and other stakeholders was that they needed to approach this from a development point of view so that the farmers were capacitated to be able to actively participate in the agri-value chain.
Mr Ramasodi said that in the development of the agriculture and agri-processing master plan, the Department saw this programme as a very good call, especially in terms of ensuring that the regional red meat value chain would require them to have custom feedlots expanded to other areas, and within the current areas of KZN, North West and the Eastern Cape. One of the key points of the regional red meat value chain was to ensure that there was integration. These days, when looking at red meat development, the beef supply chain had become increasingly vertically integrated, and the Department was looking at that integration to ensure that there could also be farmers and value chain role players who could have their own retail outlets. It was very important that they did not have feedlots that would not be sustainable on their own.
Mr Ramasodi said the ARC would be taking over issues around infrastructure, but not without a proper handover from the NAMC. With regard to youth employment, they wanted to continue ensuring that there was employment in the sector, where most of the input would be used and be in line with the Department’s beneficiary selection, to ensure that youth, women and people with disabilities were included. The provincial Departments had been assisting with the provision of food, and the Department would take into consideration the suggestion that there should be feeders employed in the feedlots.
He said there had been no random termination of the NAMC contract with the feedlots. There had been a timeline that was given in terms of the engagements between the Department and the NAMC, and the only issue that needed to be managed was the transitional arrangements. The Department would have to work with the ARC to ensure that there were backward linkages into the Feedlots Association in terms of the memorandums of understanding (MOUs).
The Department had thought that it would have a smooth transition moving from the NAMC to the ARC, but this had not happened because of two things. The first was that the ARC had requested that they would like to be identified in the SLA that the Department had signed with them. That would have required concurrence between the Minister and the Minister of Finance, which had been received in November last year. The other challenge was that the ARC proceeding would have meant that the Department would be left with a few unfinished areas, which would have needed further progress through engagement with the NAMC. The Department had requested the National Treasury to allow the NAMC to conclude, because it would have raised a few queries from a supply chain management (SCM) point of view.
Ms N Mahlo (ANC) said that as much as the feedlots had indicated that they had problems, the managers of the feedlots needed to understand that when they were given responsibility for certain things, they should not sit and look at being fed all the time. They needed to come up with alternative plans that would help them carry the work forward. She said that the government could not always feed the same people, as there were many other people and projects to look after. The managers needed to come up with their own business plans and market runs that would assist them to be able to run the feedlots sustainably on their own. They had to establish a quality management system which would have policies that allowed them to be able to market themselves so that they could sustain themselves, even if the government could not. The Department needed to give land to the feedlots as well as ploughing equipment in order to help them to plant to feed the livestock.
She said that the Department needed to make a mark every time it was asked to, in order to avoid comments that the ANC-led government was failing. Each and every project needed to be completed and people had to be trained in order to run those projects effectively. The government had done a good job in launching the feedlot programmes, but what was lacking was the quality management systems, as well as marketing tools.
Mr N Masipa (DA) wanted to know if there was a budget for these feedlot programmes. He also wanted to know from the ARC whether the custom feedlots had been consulted to make their input when the business plans were made, in order to ensure that the feedlots were run smoothly. The challenge that the Committee had with the Department was the issue of the “middleman,” as there was a R1.2 billion job stimulus package, of which 5% -- about R300 million -- went to the “middleman.” The R300 million could have done a lot in assisting the feedlots.
He agreed with Ms Mahlo that the feedlot programmes needed to be made more sustainable, as it was not sustainable to feed animals for 12 months a year -- even a commercial farmer could not feed the animals for 12 months a year. They needed to ensure that they had their own land where they could plant and be able to supply at least six to eight months of the year, and then obviously in the remaining months of the year they would feed. He urged the Department to make sure that when they did all their business plans and SLAs, they engaged the feedlots, because had they been consulted, the people from the feedlots would not be engaging the Portfolio Committee on the issue. The challenges that the programme was facing now was the vandalising of infrastructure, which would be very costly to replace.
He said that the Minister and the executive needed to be careful of going around and promising people things that were not in the budget, because this puts pressure on the Department and the entities of the Department ending up having irregular expenditures.
Ms A Steyn (DA) wanted to know where the feedlots were located.
Nkosi R Cebekhulu (IFP) said that it was important that the communities were trained for whatever projects were established for their development. The communities had to take ownership of those projects, and must have the means of sustaining them rather than expecting that the Department would always be assisting them. The country had nine provinces, and all of them were expecting different sorts of development coming to their communities, more especially the previously disadvantaged. When they were assisted to enter into businesses, the recipients must make sure that they took it upon themselves to ensure that they had funds put aside to run those projects as soon as the Department withdraws its support. It was worrying that the way that the Department ran things was not properly coordinated. The Department should always outline its goals and set timelines for when the projects would start and finish, in order to give time to the people within the communities to prepare for sustaining the projects without assistance from the Department.
Ms K Mahlatsi (ANC) said that it was problematic that the presentations did not give clear details. She wanted to know from the NAMC and the ARC the terms of reference between themselves and the Department. She asked what the programme was intended for, and how it had benefited the communities. She did not think that the Department should continuously burden itself, especially where there were the financial constraints that the government was facing. The Department must also indicate how the monitoring and evaluation throughout the implementation of the custom feedlots programme was done. She recommended that the feedlot programmes should exist within other existing programmes without necessarily having a middleman, but by having a sustainable programme that was led by the Department itself, to ensure that they did not lose the young people who had already been appointed for these particular processes.
Mr N Capa (ANC) wanted to know whether there were any plans in place for the programme to be sustainable, and whether there were any indications currently that there was a possibility for sustainability. There were two matters on which he needed clarity regarding the nature and duration of the agreements in the programme -- the random termination of the contract, and the timeline indicated by the Department. He wanted to know about the things that were needed in the feedlots, as Mr Jikijela had mentioned that there was infrastructure, and people available for the jobs. He also wanted to know whether it was essential that for the feedlots to be sustainable, they would need to have their own feeds. He asked for a clear linkage between the red meat producers, the feedlot farmers and the ordinary rural farmers. He also wanted to know where the feedlots were stationed in terms of provinces, and what kind of provinces they were stationed in, and the reasons for that. He also wanted to know the rate of the flow of animals from the rural farmers to the feedlots, which should be an indicator of the success rate of the feedlots.
The Chairperson said that there seemed to be limited communication between the Customs Feedlots and the Department. The brief that the Committee had received from the Department indicated that the programme had been funded for the past five years and the contract had ended in 2020, while the customs feedlot leaders seemed to not know whether there was an MOU that had been signed with clearly stated timelines for the programmes. She agreed with the other members of the Portfolio Committee that there needed to be clear-cut indications as to when the programme began, who it catered for, and why the other provinces in the country had been neglected. She wanted to know if the feedlots programme would expand to other districts in the next few years and whether there was a budget for the programme.
Responses by the Department, ARC and NAMC
Mr Ramasodi said that the plans that the Department had with ARC involved an expansion plan to all nine provinces in the country and at the core of that plan, was the issue of sustainability. The feedlots needed to be able to indicate the average daily gains of the cattle in the feedlots, the feed conversion ratio, as well as the efficiencies in the environment where they keep the cattle, and that was why the ARC had been brought in by the Department. The expertise that the ARC had, together with those from the industry, would be able to bring the Department to a level where they dealt with this as one programme that would be within the National Read Meat Development Programme. It was in the Department’s master plan to have custom feedlots that were developed, and to have red meat zones that were developed all over the country and ensure that they could assist and start making sure that the animals that were in the hands of the farmers could be converted as soon as possible into money to assist the economy. The issue that was being contained in the current arrangement with the ARC was about sustainability models and an exit strategy in terms of whether the businesses which were previously assisted would be able to stand on their own.
He apologised to the Committee that the Department, the ARC and NAMC could not compile a presentation, and explained that they did not know what issues would be raised by the chairpersons of the feedlots, although they did have suspicions. The red meat value chain was integrated in most instances, so there was also a need to have forward and backward linkages. The Department was also aiming at emphasising the training of individuals to run the feedlots, to ensure that there was skills development as part and parcel of the agricultural management practice (AMP) to ensure that programmes that were run by government would leave an area with the skills that people would need to run businesses.
Mr Ramasodi agreed with Ms Mahlo on the government’s quality management systems and internal issues, and added that the government had come up with the Chief Procurement Office (CPO) within the office of National Treasury, and with the current issues that the government was facing on procurement, it might be said that the office might be swamped with requests. The process that the Department had embarked on was a process of ensuring that there were budgets set aside within the Department of Rural Development to ensure that they dealt with problems as they arose. The Department would provide the list of the places where the feedlots were stationed in each of the three provinces -- the EC, KZN and North West -- so that the Committee could perform their oversight on them.
He said that the engagement with the ARC was for a period of three years, with the possibility of an extension based on the performance of the programme, because the Department also needed to measure performance.
Dr Ngqangweni asked to be allowed to provide a slide presentation on the details of the National Red Meat Development Programme (NRMDP), as well as the performance of the programme so far and the location of feedlots. He asked the senior manager to brief the Committee.
Ms Khumbuzile Mosoma, Senior Manager: Agribusiness Development Division, NAMC, said that in the 2013/14 financial year, the programme was operational in the Eastern Cape, with four custom feeding facilities. The investment was R4.2 million, and the programme generated R12 million and supported more than 150 farmers.
In the 2014/15 financial year, there were five custom feeding facilities in the Eastern Cape, with R15.8 million invested in terms of infrastructure, feeding the cattle and remedies, including the salaries of the NRMDP personnel. R9.6 million was generated in terms of income for the farmers and there were 250 beneficiaries who benefited from the project. There were also six auctions that were facilitated, and 1 950 cattle went through the custom feeding facilities in the Eastern Cape in that financial year.
In the 2015/16 financial year, the project was implemented in the Eastern Cape, and it moved to KZN, where the NAMC facilitated a number of auctions. In total, there were 11 custom feeding programmes in the Eastern Cape and KZN, and R14.3 million was invested in the infrastructure and other activities of the programme. R23.1 million was generated in terms of income for more than 550 farmers, ten auctions were facilitated, and 2 594 cattle were fed through the custom feeding facilities.
In the 2016/17 financial year, the animal capacity in the custom feeding facilities was 5 560, and 6 550 cattle were sold in the financial year. The investment was R25.5 million, and R33.7 million in income was generated for more than 700 farmers. There were 16 custom feeding facilities that were operational, and during the year they also moved to the North West and were operating in the three provinces.
In the 2017/18 financial year, the investment was R9.9 million, and the programme generated R31.1 million for more than 700 farmers. The custom feeding facilities that were operational in the year totalled 16, and there were ten auctions that were facilitated. There were 3 953 cattle sold through the custom feeding facilities.
In the 2018/19 financial year, which was one of the best, there were 17 custom feeding facilities and the projects generated R48.7 million for the farmers. There were 2 250 participating farmers, and the NAMC had facilitated 28 auctions, most of which were in KZN. Six cattle were fed through the custom feeding facilities, and NAMC also supported the programme with sheep, mostly in Eastern Cape, where 563 sheep were sold, and through the auctions in KZN, 764 goats were sold.
In 2019/20, the programme generated R19.7 million in income for the farmers. There were 1 047 farmers who participated, 11 auctions facilitated and 2 876 cattle that were sold, alongside 256 sheep and 699 goats that were sold through the auctions. There were 17 custom feeding programmes, and the NAMC also had 12 custom feeding programmes that were under construction, with five of them in the Eastern Cape, five in KZN, and two in the North West province that required renovation.
Mr Masipa said that questionsd about the budget had not been answered, and asked the ARC to address the issue. He believed that sustainability was important, and that the Committee needed to be provided with some of the critical success factors in the areas that this programme was running. Looking at the numbers presented, it seemed like the Department was still investing way over the turnover of the businesses, so the contribution from the members was R1 000, and that would not make it sustainable in the long run. Ideally, the Department wanted to make the programme financially sustainable in such a way that when the project was completed, it could move to the next phase, knowing that the contribution was able to sustain them, and that they could also go and raise private funding in order to really make sure that they were sustainable in the long run. The key part was that there was a need for land.
Ms Mahlatsi said that she was going to raise the very same issues as Mr Masipa, as the Department would not want to find itself in the same situation in the next three years. She wanted to know how the programme had managed to expand itself, as well as how it saw itself operating without the government’s assistance over the next three years.
Response by Department, ARC and NAMC
Mr Ramasodi said that the budget was with Rural Development, as this was also where the programme had been run over the years.
Prof Maiwashe said that the project had originally been operating in three provinces, and the motivation now was to expand the project into all the other provinces of the country in the context of the agriculture and agri-processing master plan. The ARC had worked out a budget that would allow the scaling up of the project, and it was stretched over the period of three years. The key line items in the budget were on enterprise development, market access -- which was for both formal and informal markets -- and also the procurement of feed and veterinary supplies, which was quite a significant component of the project. This component would be reduced as the project went into years two and three. There was also a line item on human capital development advisory services, and there were also some operational expenses with regard to the implementation of the project altogether.
For the first year of the programme, it would cost the project a total of R106 million, and in the second year this would go down to R100 million, and in the final year it would be R106 million. As for the project's sustainability, the idea was that in terms of feeding, the ARC was going to phase in the establishment of planted pastures, which would obviously take time to be established. In the first year, the feedlot centres would be subsidised with feed at the 100% level, and this would go down in the second year to 50%, until the last year where the percentage would be much less. The idea was that sustainability should be built in from the first year of the project so that farmers could be commercialised, as this was the key driver of the programme.
The key deliverables from this investment would be functional custom feeding centres in the different provinces, and there would be planted pastures that farmers would be able to rely on in terms of the product flow. There would also be small and medium enterprises (SMEs) that would be developed through this project, and there should also be legal entities so that they would be able to enter the commercial space.
He said there would also be community livestock auctions that would be able to operate in the rural areas. There would also be the market access, which would allow the pressure to be taken off. There were also the community-based value chains, looking at the feedlot custom feeding centres as a hub that had the forward and backward linkages to both the upper and the lower ends of the value chain.
The other aspect referred to the animals themselves, in that the animals that go through the feedlots need to have certain genetics for them to be able to perform at a level that would make business sense. The support from the animal health side of things would assist farmers greatly to have a quality input into the custom feeding centres, but key was the development of skills, because these businesses would not be sustainable without skills on the side of both the farmer and the feedlot owner, and also on the youth and the women who would be involved in these projects.
Lastly, sustainability was key, and the ARC had built this programme on the lessons learned from the implementation that was done by the NAMC.
Ms Mahlo said that maybe the intergovernmental relations policies needed to be tapped into, so they could engage the sector education and training authority (SETA) with regard to skills development on the projects, and also engage the Department of Trade and Industry (DTI) with regard to the development of a marketing tool, as well as other departments that could assist.
Dr Ngqangweni said that before the transition of the programme was put into action, there was already an element built into the programme in terms of sustainability. The NAMC were approaching it in a way that in order for the government to exit, it needed to have left very sustainable and self-running institutions on the ground. The NAMC was going to build on the model that had already been established by the local stakeholders in the form of cooperatives. There was a plan to train and capacitate the cooperatives to form business entities that would then run these facilities going forward as functional business entities. That exit claim had now been taken over by the ARC.
The other indicator that one would have to look at to test the sustainability and whether this programme was successful or not, was that the whole idea in the first place was to commercialise the assets of the involved communities in the form of livestock. One would have to look at the number of livestock and the value of the livestock that had access to markets, because this had to increase on an annual basis in order to contribute to a bigger livestock economy.
The Chairperson asked for the Committee to be provided with the budget that was outlined by Prof Maiwashe, alongside the presentation of the NRMDP programme.
Conclusion by Customs Feedlots Organisation
Mr Sefatsa said that it seemed like the only problem that was standing between the feedlots organisation and the Department, the ARC and NAMC was communication in terms of what they had prepared for the organisation, or for the red meat programme in general. The most important thing was that when they were planning things, they needed to also involve the feedlot organisations. Moving forward to the next three years, there should be an SLA or an MoU with clear timelines and guidelines. At this point in time, the focus was on the self-sustainability of the custom feedlots, as they were originally made to assist inalleviating overgrazing and overstocking in communal areas, villages and commonages in townships. Three years was clearly a short space of time, but they were hoping they would be in a position to self-sustain the custom feedlots over the given period.
Red meat zones also needed primary producers around feedlots to be able to produce quality animals, as at the feedlots, there were animals that picked up weight and others that did not pick up weight quickly. At the custom feedlots, the primary producers of animals needed to be assisted with breeding cattle, and those in the villages and commonages needed to be assisted with quality bulls so that the sustainability of the feedlots could have a bright future moving forward.
He said that they wanted to be sustainable as quickly as possible, making sure that each and every feedlot was functional. They had already established cooperatives, such as in Aliwal North at Walter Sisulu Secondary Custom Feedlot, which constituted about six primary cooperatives. All the activities of the feedlots needed to be standardised so that there was mechanisation in every feedlot in the form of tractors, feed mixers to produce feed maize, and also some storage facilities to keep them. There should be storage facilities in all feedlots so that they could be in a position to commercialise in a very short space of time.
Mr Jikijela said that on behalf of the three custom feedlots in the Eastern Cape, KZN and the North West provinces, he would like to appreciate the Portfolio Committee for coming into their aid within a short space of time. They had taken heed of the Committee's advice and comments, and would do as it had advised. He also appreciated the ARC, NAMC and the Department for listening to their concerns and was very grateful that through their intervention, approval had been secured for the programme to move forward.
Taking into consideration what had been advised and what had been mentioned to be essential to make sure that it was becoming a sustainable and productive programme by the government, they would also be happy to launch one feedlot before the end of the year. They would like to launch a living example of radical, social and economic transformation in deep rural areas, because the programme had really transformed the lives of rural farmers. They would like to invite the government officials, alongside the Department and especially the Portfolio Committee, to all their feedlots -- with or without notice -- to come and see what was happening.
The Chairperson thanked the National Task Team of the Customs Feedlots Organisation, as well as the Department, the ARC and NAMC for attending the meeting, and allowed them to leave the meeting.
Adoption of minutes
The Committee adopted the minutes of its meeting on 25 May 2021.
The meeting was adjourned.
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