PPECB & OVG 2023/24 Annual Performance Plans; with Minister and Deputy Minister

Meeting report

Perishable Products Export Control Board (PPECB)

Ms Bongiwe Njobe said she was the recently appointed chairperson of the new PPECB Board, which was appointed on 1 February and met from 27 to 29 March. There had been a smooth transition, as the members of the old Board and the chairpersons of their committees had highlighted all the matters that were of critical importance. Therefore there was confidence that there would be continuity in terms of the governance in the leadership at the PPECB, as it continued to elevate the important concept of customer centricity. The presentation would show the actual activities and some of the challenges and opportunities that were of focus in the next few years.

Annual Performance Plan 2023/24.

Mr Lucien Jansen, Chief Executive Officer (CEO), PPECB, took the Committee through the presentation.

The annual performance plan (APP) covered the entity's situation analysis, forecasting South Africa's economic growth at 1.7%, unemployment at 32.9% and inflation at 6.9%. It also took into account the impact of the La Nina/El Nino weather patterns, logistics and data security, job creation, digital skills development and the local energy crisis. Consideration was given to trade barriers, environmental factors and access to information.

Key strategic projects included a focus on procurement spent on broad-based black economic empowerment (BBBEE) suppliers, the sampling and laboratory testing of products, and the training of smallholder farmers in good agricultural practices (GAP) in line with the entity's transformation and development services. It would be re-designing the PPECB’s service delivery model to increase efficiencies and contain costs, and improve the business sustainability of black smallholder farmers and suppliers.

Its initiatives for 2023/24 would see attention given to systems integration; environmental, social and governance issues; partnerships; and resource alignment.

(See attached presentation for details)

Office of the Valuer-General (OVG) 

Ms Motlatso Maloka, Acting Valuer-General, introduced Mr Thapelo Motsoeneng, Acting Chief Operating Officer (COO), and Mr Kabelo Moatshe, Senior Manager: Strategy & Information, Communication & Technology (SICT), who would go through the presentation. She hoped that the Committee knew the challenges the OVG had been through, and added that they were doing their best to provide the intended services.

Annual Performance Plan 2023/24.

The OVG's presentation provided overviews of its mandate, which was derived from the Property Valuations Act (PVA) of 2014; the five factors which needed to be taken into account when valuing properties for land reform purposes to determine a just and equitable valuation; and the key clients it was prioritising for land reform valuations.

Its planned outcomes were just and equitable valuations, organisational excellence, good data quality, and the promotion of ethical conduct by implementing effective corruption and fraud prevention mechanisms.

(See attached presentation for details)

Discussion

Ms T Mbabama (DA) asked what the OVC's need was in terms of the structure that they had at the moment. They had been discussing the interim structure and that at the end of 2025/2026, they would like 110 approved and funded posts. How far were they with the centralised data repository? Was it still in the planning stages, or had they started with it already? The OVG had said they wanted to promote ethical conduct, so why did they not have a risk aversion strategy to present to the Portfolio Committee? There was no reference to risk mitigation in their presentation.

Ms Mbabama said the PPECB was a shining light, a rear breed among the entities. They were doing a wonderful job and would continue to do so with Ms Bongiwe Njobe on the Board. She asked what the timeline was for the completion of the laboratory for it to be fully functional. Did they have any smallholder farmers who were certified for export at the moment? They had spoken about the changes in the port -- what was the impact of the challenges on their revenue-generating capacity?

Ms N Mahlo (ANC) congratulated Ms Njobe on her appointment as chairperson, commenting that she was a woman to take the organisation ahead.

Mr S Matiase (EFF) said that there had been no Valuer General for a long time. At some point in the Fifth Parliament, a successful appointment had been made, but soon after, the gentleman had handed in his resignation. Mr Motsoeneng continued to act as the COO. When would that office have stability? It was an important office, because it had an important role in the land reform process. It determined land values so that appropriate cost assessment processes could be finalised and attached to the actual value of the land. How effective was the OVG in playing a role in helping land reform processes and related functions in the context of their mandate?

Mr M Montwedi (EFF) said that over the years, the OVG had been speaking about issues of capacity. Did they have the capacity to implement their plans, or was the Committee likely to receive a report from them saying they have not been able to implement their plans due to capacity issues? Had they looked at the issue of capacity before making their plans? Had the OVG been able to achieve its autonomy to operate independently from the Department? The OVG did good work, but there was a serious concern that when government bought the farms and the OVG evaluated them, they were of good value, but the process of allocating the farms from the Department took so long that the farm was no longer of the same value when the farmer occupied it. In most instances, the farm owners removed everything of value because they knew government could take up to a year to allocate the farms. Government had bought a farm of about 43 000 hectares in the North West. The owners had removed everything of value and vandalised the farm, so it lost value when the beneficiaries occupied it. How did the OGV bridge the gap when people took advantage of that situation? This was not the first time he had raised this issue with the OVG.

The Chairperson said that in the past year, the PPECB board had highlighted uncertainty and lack of clarity from the Department of Agriculture, Land Reform and Rural Development (DALRRD) regarding the long-awaited PPECB bill. Could the Department provide an update on the legislation and its progress? Following the floods and their impact on KwaZulu-Natal, particularly on the Durban harbour, what challenges had the PPECB experienced in terms of exports from the harbour?

PPECB’s response

Ms Njobe acknowledged the compliments from the Committee Members. She said the CEO would answer the questions and she would comment on how they were trying to use partnerships to resolve some of the issues, especially with the pace at which black farmers' products were being certified for export.

Mr Jansen said they appreciated the acknowledgement made by Ms Mbabama, as they were trying and sometimes made mistakes.

The timeline for the laboratory was three years due to the huge costs that they foresaw. It was operational, and services were still being added to it, including moving to a new building and procuring additional analytical machines.

Every year, they certified farmers as export ready, and for the years 2021 and 2022, they certified 89 smallholder farmers across South Africa. The one challenge regarding the certification was that many farmers struggled with funding infrastructure, and the OVG would partner with other entities to assist with this challenge. The impact of challenges on revenue had not been felt, because once the product had been inspected, the PPECB would invoice the client. The challenges were on the operational side, where the value chain and the pressure on the value chain pushed back towards the packhouse, which created more hours to be worked and resources to be dedicated and deployed by the PPECB. There was a slight challenge with the costs, but mostly on the resources and not necessarily on the state of the revenue, but the situation would be monitored.

There had been subtractions in terms of the bill. There were strategy changes and they updated the regulations again. The bill had been sent back to PPCEB and they were working through it.

Regarding the situation at the port, last year's citrus had been challenging because of the backlogs, and the product had not been exported fast enough. The impact was on the resources and the value chain pushing back, and more resources needed to be dedicated.

OVG’s response

Mr Motsoeneng said that once a property's value had been determined and the valuation certificate and report had been submitted to the Department, they proceeded to conclude the transaction and acquire the land, but from there on, the OVG was not involved, as that was the end of their role. Two days ago, on 16 April, there was a session with the Department on the digitisation of the land acquisition process and its allocation. The Department and the present OVG members had spoken about the timing of the land allocation to the beneficiary.

The OVG was now autonomous, and had started operating on their own in June last year, with about five bodies operated by OVG officials. For the first two months of the last financial year, they had been working from the Deeds' systems, and Deeds was helping with the annual financial statements.

Mr Motsoeneng said there was room for improvement in ensuring sufficient valuation reports and certificates to allow the Department to push the inevitable fact of action that had to follow the submission of the reports. The process of analysing rejections had been started, and this process had been formalised by the Director-General (DG).

The issue of risk mitigation missing in the APP was because of the template used for developing APPs. The OVG did have risk registers and was running a fully fledged management outfit. Internally there were strategic risk registers, with risks identified and mitigation strategies identified. A combined assurance mechanism was institutionalised and looked at the responsibilities of management and oversight structures.

A programme was running with the Department regarding 2023 initiatives, and the APP had been drawn up together with the Department. The initiatives were based on where to unlock efficiencies, like making proposals for regulations. During May, there would be a series of workshops discussing these efficiencies and making proposals to the executive authority, one of those being the use of technology for historical valuations. There was already a data repository, but the progress was not where it should be. The senior manager responsible for information communication technology (ICT) was seized with the process of finalising the enterprise architecture, which would be the blueprint of how data would be managed.

Further discussion

Ms Mbabama referred to the fact that both the Valuer-General and the COO were in acting positions, and not permanent. Was it true that the VG had been acting since 2019, and the COO had been acting since the 2015/16 financial year? If so, what were the plans to have these positions filled?

Ms Mahlo asked the OVG what steps would be taken to ensure that the primary focus on land reform did not affect its ability to provide adequate property evaluation services in other areas. How would the organisation balance its focus on land reform with the need to provide impartial and usable property evaluations? Regarding the partnership with the Department and private entities to support economic growth and job creation initiatives, what was in place to support women with disability? How did they evaluate the issue of making sure that people with disability were taken on Board?

Ms Maloka responded on the issue of the acting roles, and said they had been advertised.

Regarding bringing people with disability on Board, this was done through the supply chain management (SCM) tenders that were advertised. The Preferential Procurement Policy Framework Act (PPPFA) regulations had recently been changed, and they were allowed to decide on how to effect empowerment. SCM processes were used to effect those empowerment programmes. Some points were going to women entities and people with disability. The private sector was also engaged through the panel of valuers, together with the Department, for appointments based on that particular panel.

Ms Mbabama said she had asked about the acting positions of the VG and the COO, and the response was that the posts had been advertised. When had they been advertised? How long had it been since they were advertised? What was the way forward with those posts, and why was it taking so long?

Ms Mahlo also reiterated the questions she had directed to the OVG.

Mr Motsoeneng said that the primary focus of the OVG was land reform, and they were not inviting new clients for Section 12 1b evaluations. They focused on Section 1A evaluations, the Commission on the Restitution of Land Rights, and the LRDR and redistribution evaluations.

Ms Njobe said that the acting COO and Valuer-General posts had been advertised. The Ministry had dealt with them and was in the process of finalising them, and would finish the process of appointing them.

Ingonyama Trust Board

The Chairperson welcomed the new chairperson of the Ingonyama Trust Board (ITB), Nkosi Mzimela, and invited him to make the opening remarks.

Adv Vela Mngwengwe, Chief Executive Officer, ITB, said that the chairperson of the ITB was not present in the meeting, and there were no board members either. The ITB was out of the country and the chairperson was unable to come into the meeting, so there was no accounting authority present. However, there was an APP approved by the Board. The ITB was in a position to present the APP if the Committee allowed this.

The Chairperson allowed the Portfolio Committee to decide whether to proceed with the APP presentation.

Ms Mahlo said that the Committee should not proceed with the APP with no one to account for it. The ITB might say they had not agreed on the APP presented, and they might have changed as they had new members. The Minister was also not present to take responsibility, and her Department was part of the Board. The ITB needed to present some other time.

Ms Mbabama agreed that the presentation must not proceed if the Board and the Minister were not present, as the questions would not be answered adequately. 

Mr Montwedi said that he wanted to know the composition of the Board of the ITB that had been appointed, and who had been extended an invitation to join the meeting, as the chairperson was not present. In the absence of the chairperson, any board member of the ITB could take the Committee through the presentation. Were there any board members, or was the chairperson of ITB the only one invited to the meeting? The Minister was also not in the meeting. Why did they not write to the Portfolio Committee in advance about these issues, rather than wasting their time with apologies for the meeting?

Ms Mahlo said that the ITB had stated there was no board member on the platform -- they were out of the country. They had not finalised issues with the person appointed as the chairperson of the Board. She therefore suggested that the presentation be postponed.

Mr Montwedi reiterated his question as to whether the chairperson had been the only one invited to the meeting. They should have informed the Portfolio Committee if they had known beforehand that they did not have a chairperson. There could not be just any official to present the APP.

Minister Thoko Didiza said she had missed some of the issues that might have been raised as concerns, but said they had forwarded the letter that was received from His Majesty the King to the Chairperson of the Portfolio Committee as well as the Chair of the NCOP, indicating who he had appointed. Even the process of appointing the Board had taken very long. The consultations had started, and the Premier, the Chair of the House and the King received the first four names. For the other four names, in terms of the ITB legislation, Section 23d, the Premier had to consult with the ITB and the Chairperson of the House. It took longer to ensure the completion of the Board was in place, and the nominee became delayed because, in terms of the legislation, it should be the Chairperson of the Board. The new Board had not met formally, but the work done by the previous Board which had led to the APP, was to be presented by the CEO. The presentation of the ITB could be postponed.

Ms Mahlo said they should close the matter and defer it to the next meeting, as the Minister and the Portfolio Committee advised. The next meeting could be arranged specially for the ITB to present their APP so that they could start the year by implementing their budget.

The meeting was adjourned.