DALRRD Budget: Committee Report; Committee Report on oversight visit to the Perishable Products Export Control Board and District Six; with Minister

Meeting report

Report of the Portfolio Committee on Agriculture, Land Reform and Rural Development Cooperative on 2022/23 APP & Budget of Department of Agriculture, Land Reform and Rural Development and its entities
The Report gave an overview of the strategic focus, 2022/23 Annual Performance Plan (APP), 2022/23 budget allocation and Medium Term Expenditure Framework (MTEF) estimates of the Department of Agriculture, Land Reform and Rural Development (DALRRD) in terms of its six programmes:

Administration
Agricultural Production, Biosecurity & Resources Management
Food Security, Land Reform & Restitution
Rural Development
Economic Development, Trade & Marketing
Land Administration

The Report summarised the Committee’s engagement with the following entities of the Department:

The Commission on Restitution of Land Rights (CRLR)
The Ingonyama Trust Board (ITB)
The Office of the Valuer-General (OVG)
The Agricultural Research Council (ARC)
Onderstepoort Biological Products (OBP)
The National Agricultural Marketing Council (NAMC)
The Perishable Products Export Control Board (PPECB)

The Committee concluded that:

- The overall decline in the Department’s budget allocation over the MTEF period was contrary to its medium-term strategic focus and could potentially undermine service delivery;
- There was financial misalignment among and within the Department’s programmes. For example, The Administration programme received a larger budget than Agricultural Production, Biosecurity & Resources Management, a key technical programme;
- Weak monitoring and evaluation remained a challenge and would continue to compromise accountability on spending of transfers and subsidies (which comprised 53% of the Department’s budget in 2022/23);
- There was a lack of concrete planning to enable subsistence farmers and smallholders to fully participate in and benefit from the Poultry, Sugar and Cannabis Master Plans. In particular, there was no action plan to ensure that indigenous and historical growers of cannabis were prioritised;
- The finalisation of the Agriculture and Agroprocessing Master Plan was a welcome development;
- There was a need for clear targets to ensure that smallholders were able to benefit from the Agreement on the African Continental Free Trade Area (AfCFTA);
- Quarterly and annual reporting on labour tenant land transfers had been dropped;
- An inability to match land delivery with complementary support was resulting in a decline in land reform farms’ productivity;
- Delays in processing amendments to the Extension of Security of Tenure Act and the Communal Property Association Act were negatively affecting the intended beneficiaries of these laws;
- There was a lack of evidence of coordination between the Rural Development Programme and other departments;
- The initiation of a process by the CRLR to determine a more accurate estimate of the costs relating to the finalisation of outstanding land claims was a welcome development;
- The failure of the ITB to table its budget or APP was a total disregard of National Treasury guidelines and it could be interpreted as a subtle evasion of accountability and transparency. Honest conversation about the role of the entity was needed;
- Strategically important vacancies at the OVG needed to be filled and it should seek guidance from the courts on the question of just and equitable compensation;
- Critical vacancies at the ARC needed to be filled, the 7% budget reduction was a concern, and intervention was required with regard to the slow pace of establishment of a facility to produce foot-and-mouth disease vaccines;
- The modernisation of the vaccine manufacturing facility at OBP required urgent attention, as did internal challenges hindering its operation; and
- There was inadequate coordination between NAMC and the Department on identifying farmers who required support to gain market access.

The Committee recommended that the Department:

- Engage with National Treasury on its declining budget;
- Brief Parliament on how the merger of the two former departments addressed duplication of functions;
- Submit updated legislation and policy review programmes with clear time lines;
- Submit a human resource plan with a specific focus on building and strengthening personnel capacity at senior management level;
- Develop an action plan to streamline its existing support programmes and conditional grants into an integrated Producer Support Programme/Scheme as envisaged in the National Policy on Comprehensive Producer Development Support;
- Report on its monitoring and evaluation activities during each quarterly briefing and strengthen reporting guidelines;
- Submit comprehensive reports on the implementation of the Blended Finance Initiative, transformation activities through the AgriBEE Fund, disbursement of Mafisa loans and utilisation of funds that have been transferred to the Land Bank since 2019/20;
- Submit comprehensive reports on its activities (including planned ones) to promote the participation of smallholder producers in the Poultry, Sugar and Agriculture & Agroprocessing Master Plans;
- Provide a progress report on the finalisation of the Cannabis Master Plan;
- Submit action plans to fast-track the participation of the agricultural sector in the AfCFTA while ensuring protection of local producers from unfair imports, and to enable smallholder producers to participate fully in AfCFTA;
- Ensure that the CRLR submits quarterly reports on the implementation of its Comprehensive Backlog Reduction Strategy, on the development of its plans to clear its Commitment Register, and on the development of plans to ensure that all outstanding land claims are researched by the end of 2022/23;
- Ensure that the ITB officially tables the 2022/23 budget allocations and submits to the Minister a written report, to include audited financial statements, on the activities of the Trust during the 2020/21 financial year;
- Develop an implementation plan for the recommendations of the 2021/22 Budget Vote Report and the 2021/22 Budgetary Review and Recommendations Report with regard to the ITB;
- Prioritise engagement with the ITB, the Trustee and other relevant stakeholders including the National Treasury and the Auditor-General to address its challenges;
- Motivate for additional funding for the ARC, ensure that it fills critical vacancies, facilitate the prioritisation of the foot-and-mouth vaccine facility;
- Strengthen oversight over the OBP and ensure that it fills critical vacancies and submits an Action Plan for the modernisation of the vaccine manufacturing facility; and
- Submit a framework on coordination of activities between the Department and the NAMC.

Discussion
Ms A Steyn (DA) asked why the Committee had not been briefed by the Veterinary Science Board (VSB).

Ms Nokuzola Mgxashe, Content Advisor: Agriculture, Portfolio Committee on Agriculture, Land Reform and Rural Development, explained that the VSB was not prioritised, given the time constraints, because it was a professional body, not a service delivery entity.
 
Minister of Agriculture, Land Reform and Rural Development, Ms Thoko Didiza, observed that the Cannabis Master Plan was still in its development phase. Consultations among social partners had not yet been concluded. Her suggestion was that the call in the Report for clear targets for supporting indigenous and small-scale farmers in the provinces where they historically produced cannabis to the Cannabis Master Plan should be re-framed to reflect this.

Ms Mgxashe noted the Minister’s comment, but pointed out that the recommendation about the Cannabis Master Plan stemmed from an indication in the Department’s own Annual Report that it had been completed or was nearing finalisation.

Ms K Mahlatsi (ANC) thought that the recommendations were slightly too instructive on operational matters. She cautioned that the Committee should be careful not to encroach on the work of the Department. She suggested that recommendation 6.2 be split into two. Firstly, the Department to report on progress on the merger of the two Departments. Secondly, to report on challenges of capacity building relating to the now-merged Department. This would minimise the confusion generally brought about by mergers. She reminded the Committee of a time when it had discussed the merger, but the President had not proclaimed the merger. This lag in time must be factored in. She cautioned that the way the Report was written gave the impression that the Department had not been deliberate for two years in ensuring progress of the merger. On recommendation 6.11, she understood that the ITB was accountable to Parliament but the Trust itself was not. She did not understand why the Trust was being required to account to the Committee, since it was not a Schedule 3 entity. On recommendation 6.12, she thought that the vagueness of the phrase “previous years” might become a problem and suggested that the specific year or years be mentioned. She also questioned the necessity of recommending that the Department develop an implementation plan for the recommendations of the 2021/22 Budget.

Ms Steyn acknowledged Ms Mahlatsi’s comments but was satisfied with the report as presented.

Ms T Breedt (FF+) agreed that the report was acceptable as presented. She did not think that the recommendations were excessively instructive.

Mr S Matiase (EFF) acknowledged that the support staff had produced a good report but there were some glaring weaknesses. It did not reflect the fact that the work of the Committee was continuous. What was discussed in previous reports of entities must be brought into current reports for continuity? The Committee should not continue to adopt reports that did not refer to its previous decisions. In particular, in 2019 a forensic investigation into the affairs of the ITB had been recommended. The Report on the table made no mention of this. Matters relating to the CRLR had also been going on for a long time. It was not clear that the CRLR was geared towards finalising outstanding land claims within the prescribed timeframe. He thought that recommendations 6.10 and 6.11 rendered the Report unsuitable for adoption. The position of the EFF was that it should be reworked and full accountability and disclosure of the matters he raised should be incorporated into the Report before it could be adopted.

Mr N Capa (ANC) said his internet connectivity had disadvantaged him from participating meaningfully in the meeting. He supported the adoption of the Report with the changes Members had suggested.

Ms T Mbabama (DA) said that the content team had taken the considerations of all Members into account when drafting the Report. It should be adopted as presented.

Ms N Mahlo (ANC) agreed with Ms Mahlatsi that the Ingonyama Trust did not need to account to the Committee. She was concerned that recommendation 6.10 was too explicit on administrative matters and could encroach on the separation of powers.

Mr N Masipa (DA) said that the recommendations omitted an important issue. The Committee had had long discussions with OBP regarding vaccine availability. While recommendations 6.16, 6.17 and 6.18 did cover the issues at OBP quite extensively, vaccine availability was not covered.

The acting Chairperson agreed with Ms Mahlatsi that recommendation 6.2 should be split into two separate recommendations. She also agreed that the Committee should focus on the ITB rather than the Trust itself, that the use of “previous years” should be clarified, and that the recommendations should make reference to vaccine availability.

Ms Mahlatsi asked for clarity regarding recommendation 6.10. She recalled that when the CRLR had presented the outstanding land claims, they had told the Committee that they had met some of their targets and that some claims would be finalised in the current and following financial years. The recommendation as it stood gave the impression that all the claims which had been gazetted by the end of 2022/23 should have been researched. The Commission did not have the capacity to conduct so much research. The inclusion of the word “all” should be clarified in the sentence “research plan to ensure that all the outstanding land claims are researched.” Did it include all those claims that were previously brought before the Committee? She also pointed out that there were no recommendations to include programmes to empower, youth, women and people living with disabilities, even though the Report mentioned that there was a decline in programmes that were meant to assist and empower young people.

Ms Mbabama saw no error in the way recommendation 6.10 had been worded. The Committee was making a recommendation and the Department could respond accordingly.

Dr Tshililo Manenzhe, Content Advisor: Rural Development and Land Reform, Portfolio Committee on Agriculture, Land Reform and Rural Development, agreed to split recommendation 6.2 into two. He explained that recommendation 6.10 emanated from Committee discussions about the slow pace of land reform. It was not saying that all outstanding land claims must be settled by 2022/23. It merely identified a problem area around research and made a recommendation on that. Over the years the CRLR had brought in consultants and indicated that all land claims would have been researched by this time and to date, it was not clear whether that research had been concluded. The recommendation aimed to nudge the Department into doing the research. He said that until that day’s meeting, the Committee’s view had been that both the ITB and the Trust itself should account to the Committee. If the Committee took the decision that only the Board needed to account, it must be clear what monies it was to account for: just the transfer from the Department or any other monies the Trust accumulated? This brought up the question of the purpose of the Board, which was to act on behalf of the trustees, so they were linked. If the Committee decided that the Trust did not need to account to it, it might be a very important step. How would it assess whether the funds were being used for the material benefit of communities living on the Trust’s land, as required by legislation? He agreed that the use of the word “previous” should be clarified in previous budget vote reports. Members would have to clarify precisely which reports they wished to include in the recommendation. He observed that the Report did mention how many hectares were to be allocated for women, youth and people with disabilities.

Ms Mgxashe explained that the matter of vaccine availability had not been included because there was an oversight report that dealt with this matter. If members wanted it included then it could be added to the recommendations. She suggested that, where the Department had not yet responded to recommendations in previous years’ Reports, the Committee could still call on the Department to respond, rather than including them in the Report currently on the table.

Ms Mahlo acknowledged Dr Manenzhe’s position regarding the accountability of the Ingonyama Trust, but she understood that it was a private institution that did not need to account publicly for its affairs. The powers of the Trust and the Board must be separated. If the Board asked a professional like a quantity surveyor to inspect the land, the Board must account and not the Trust. The land belonged to the Trust and it was free to do whatever it wanted with it, but the Board must account for the millions given to it. She suspected that the reason for there being no reports from the Board was because the affairs of the trust and the Board had not been clearly separated.

Ms Steyn observed that there seemed to be a difference of opinion regarding the accountability of the Trust. She recalled that the relationship between the Board and the Trust had been a bone of contention for the Auditor-General and suggested a meeting with Treasury to clear up the matter. The trust received money from government to manage the land and it received monies from leasing or sale of land and other sources. If the Trust refused to be held accountable for the land then it should be dissolved because at the end of the day, the Trust owned no land, it just held it in trust for the people living on it, while Parliament was the overseer of the land. This was why the community had argued in court that Parliament was not looking after them properly.

The acting Chairperson noted that recommendation 6.13 indicated that an oversight visit to ITB needed to be done. This would address the matter of the Trust being debated. It would also give the Committee the opportunity to bring together all the relevant stakeholders to engage the trustees. She suggested that the Committee not dwell too much on this issue and use the opportunity of the oversight visit to clarify the issues at hand.

Mr Masipa agreed that the Committee should wait until after the oversight visit to the ITB before trying to decide on these issues.

Mr Capa said it seemed as though the Committee wanted to be clear on what is expected from the Trust and what is expected from the Board and to not just bundle them together. There had been times when stakeholders had said that they did not need to account for what they did not get from the government and the Committee did not want those kinds of issues to come up again. Clarification of duties and accountability should be done, and this would be key during the oversight visit.

Ms Mahlatsi noted Dr Manenzhe’s response on the issue of youth, women and people with disabilities but maintained that it should be a specific recommendation. Considering the high level of youth unemployment in the country, young people must be elevated. Issues of gender-based violence were fueled by women being sidelined from participating in the economy. Along with infrastructure, agriculture development was one of the main drivers of the economy, and women’s participation should be seen as a side consideration.

The Report was adopted with the changes discussed.
 
Report of the Portfolio Committee on Agriculture, Land Reform and Rural Development on Oversight visit to the Perishable Products Export Control Board and District Six on 29 March and 1 April 2022
 Ms Mgxashe said that, as the Report had been received by Members of the Committee some time ago, she would assume that they had had time to read it, and would therefore not go through it in detail. The Report contained summaries of the Committee’s oversight visits to PPECB and District Six.

The Committee observed that:

- While digitisation was an important advancement, it could also be a disadvantage to computer-illiterate and uneducated farmers who were also interested in entering the export market;
- The impact of the Covid-19 pandemic and the conflict between Ukraine and Russia had had negative effects on exports and therefore on the operations and revenue of the PPECB;
- Only a small proportion of South African fruit was exported to other African countries;
- Conditions at ports were negatively impacting PPECB inspection personnel;
- There was a need for investment into agricultural and rail infrastructure to support inland producers, particularly small-scale producers;
- The CRLR was complying with a court order to ensure justice for victims of forced removals and to submit quarterly progress reports;
- Although concrete progress was being made in the development of residential units in District Six (Phases 1-3 were complete), they were not yet occupied. Some of the intended beneficiaries of these units had passed away while waiting for certificates of occupation. This slow progress was a great concern to the Committee;
-  Phases 4 and 5 were expected to be completed in 2024/25. However there had been complaints from victims who had waited a very long time to occupy units. The Committee highlighted that occupancy should be prioritized especially for elderly claimants;
- A contract between the Department and the security company responsible for guarding Phase 3 units had reportedly expired, exposing the units to the risk of vandalism and destruction; and
- The CRLR has been engaging the Cape Peninsula University of Technology to purchase land to develop the last two phases. The land in question was historically part of District Six.

The Committee recommended that the Department:

- Ensure that the PPECB gets additional funding for capacity building programmes for smallholder producers to increase their access to export markets;
- Submit an action plan with time-lines for how it would leverage market access for local producers, particularly smallholders, to the Southern African Development Community (SADC) and the AfCFTA;
- Liaise with the Department of Transport to discuss the problems at ports and harbours and problems with freight transport more generally, highlighting the need for investment in rail infrastructure, particularly serving inland agricultural production areas; and
- Provide an update on the Strategic Integrated Project for agro-logistics.

The Committee recommended that the Chief Land Claims Commissioner:

- Submit CRLR’s quarterly reports to the court to Parliament for information purposes;
- Submit quarterly reports on the finalisation of the District Six land claim, including in particular the allocation or resources for the redevelopment of the area, the return of claimants or their direct descendants, and the occupation of Phase 3 units; and
- Develop and implement a communication strategy to ensure that the claimants awaiting the construction of Phase 4 units are informed about the progress and the expected date of completion, allocation and occupation.
 
The report was adopted as presented.

The meeting was adjourned.