OBP briefing on the Good Manufacturing Practice Project, vaccine production and governance matters; DoA implementation of the PESI and update on the revitalisation of irrigation schemes

Meeting report

Opening Remarks

The Chairperson said the Committee would be briefed on the Good Manufacturing Practice (GMP) project, vaccine production, and governance matters by the Onderstepoort Biological Products (OBP) Board. The Department of Agriculture (DoA) would present a progress report on the implementation of the Presidential Employment Stimulus Initiative (PESI), and there would be an update on the revitalisation of irrigation schemes. The final agenda item would be the adoption of the outstanding Committee minutes.

She said OBP had presented to the Committee last week, and there were discrepancies between the figures provided by OBP, the Department, and the chief executive officer (CEO). Three different amounts had been presented, some dating back to 2022. When questioned, OBP had explained the figures were outdated. The Committee had recommended a different amount to the Ministers of Finance and Agriculture, based on information received during the budget review process, which had already been debated in Parliament. However, when the Department later presented a lower figure, the Committee had sought clarity directly from OBP.

The presentation by OBP’s CEO and chief operating officer (COO) did not fully resolve the issues, creating yet another conflicting scenario. Therefore, she decided it would be beneficial for the entire OBP board to attend the meeting, as the Committee had not met them before. She acknowledged that the information sent by OBP was useful but raised concerns that some of the data, particularly the budget figures, seemed outdated, noting that the board was relatively new, having been appointed in November 2023. The departure of key personnel at OBP had further complicated the situation.

The Chairperson expressed concern that missing or unreliable information at OBP might hinder the Committee's ability to track progress. However, she had given the OBP board an opportunity to present, asking that they focus on key issues. She had asked for an update on the Good Manufacturing Practice (GMP) facility, particularly regarding the appointment of a new engineer. She acknowledged that OBP might not have this information yet, but emphasised the need to assess the stock of materials available for the facility’s construction.

She also raised concerns about materials purchased in foreign currency, as flagged by the Auditor-General (AG), noting that their value had not been converted into rands. She asked OBP to clarify the delivery timeline for the dryers, expected in early 2025, and to address the governance issues related to vaccine production, particularly in light of the departure of financial managers.

Lastly, the Chairperson said that the Committee would not require additional information in the next meeting, as the data OBP had already provided would serve as the starting point for further discussions in 2025.

OBP presentation

Prof Peaceful Mabeta, Chairperson: OBP, introduced the board members: Mr Rajesh Mahabeer, Ms Linda Makuleni, Ms Sinovuyo Matai, Dr Natalie Skeepers, Mr Mokutule Kgobokoe, and Dr Bethuel Nthangeni, along with Ms Elspeth Govender, Chief Financial Officer (CFO), Mr Collin Mackinum, Chief Operations Officer (COO), and Ms Welekazi Dukuza, Company Secretary, who would contribute during the presentation.

Prof Mabeta briefly addressed the matters raised. She said they had carefully considered the issues, starting with vaccine production, which had been raised by the Portfolio Committee several times. Regarding back orders, 67% of all vaccine orders, except for African horse sickness, had been fulfilled. The backorder for the African horse sickness vaccine had been cleared as of 26 November.

She said that at the September 2024 meeting, the Committee and the Minister of Agriculture had requested a report on the GMP project. The OBP had indicated that a joint committee was working on the report to assess spending, remaining funds, completed activities, and outstanding costs. The Minister stated he would review this report and, once satisfied, would give OBP the go ahead to proceed with the GMP project. Until then, the project was on hold.

As for the GMP costing, OBP required approval to appoint a service provider, and that approval was pending the Minister’s review. The CEO would provide further details on the GMP in the upcoming presentation. They had also submitted a report to the Portfolio Committee which mirrored the one sent to the shareholder on 31 October, as promised.

Referring to the audit improvement plan, she said they would address the progress in resolving the issues raised by the AG.

This was a summary of the key points, and they would expand on product availability and other matters in the presentation.

Dr Nthangeni, Interim CEO, OBP, confirmed that the GMP report had already been submitted to both the shareholder and the Portfolio Committee, summarising the key details.

Regarding the appointment of the principal agent, he said progress had been halted due to the project being on hold. The process required the appointment of a special adviser, which had also been paused.
On actions against the former CFO and financial manager, he clarified that the issues were related to financial controls and delegation violations, not mismanagement of funds. The board had decided to close the matter after reviewing the situation.
Dr Nthangeni outlined the GMP equipment purchased, including clean room panels, roller bottles, fermentation equipment, and generators, with costs provided in the annexures. He explained that the original R492 million allocated for the GMP project had R150 million remaining, but due to changes in GMP guidelines, a redesign of the facility was required, delaying cost estimates.
On product availability, he said that the back orders mainly involved blood vaccines, with the African Asiatic vaccine expected by 6 January 2025. Other vaccines were available, with further details in the annexures.
He updated the Committee on two freeze dryers, one arriving in January 2025, with installation in February, and a second being procured with R25 million from the Department, set for installation by July 2026. He would hand over to the CFO for an update on the audit improvement action plan.
Dr Nthangeni said OBP faced challenges with energy disruptions despite having generators, which were insufficient. To address this, they had initiated a solar energy project. Water disruptions had also impacted their manufacturing plant, and they were exploring borehole water as an alternative.

Regarding outdated equipment, he said OBP had implemented a six-year capital expenditure plan worth R2 billion, aimed at upgrading facilities and capacitating the engineering and maintenance unit. He emphasised the importance of training staff to maintain new equipment like freeze dryers.

He said OBP was reviewing 35 policies in consultation with the unions. He also highlighted updates to the intellectual property policy and confidentiality agreements to safeguard the organisation’s assets.

Ms Elspeth Govender said OBP had developed an audit improvement plan to address audit qualifications, which was being updated weekly. She reported satisfactory progress, and included a recovery plan annexed to the presentation.

Dr Nthangeni clarified discrepancies in funding for the GMP facility. He explained that OBP initially requested R1.2 billion in 2012 but received only R492 million, which was used for facility design. A shortfall had led to redesigning the project as a refurbishment. A quantity surveyor in 2022 estimated costs at R720 million, but with inflation, the 2024 cost now stood at R893 million. He said appointing a principal agent could further adjust the figures due to new guidelines requiring facility redesign, which would likely change the estimates.

See attached for full presentation

Discussion

Mr M Montwedi (EFF) said OBP had struggled to appoint a principal agent since early 2023. He referred to a report from September 2024 by two committees, which had requested information from OBP to make decisions on five or six issues. He expressed frustration about inconsistent cost figures, commenting that OBP seemed to be guessing numbers which lacked credibility.

He asked why the specifications from the previous principal agent appointment were not being used, and suggested delays stemmed from missing information, possibly removed by former staff. He urged OBP to finalise the principal agent appointment to avoid further delays and inflated estimates.

Mr W Aucamp (DA) expressed confusion over OBP’s cost calculations. He said that R720 million had been estimated in 2022 for the 2013 facility design, adjusted only for inflation by 2024. He clarified that no new design upgrades had been factored in between 2022 and 2024. He pointed out that in 2012, OBP had estimated R1.2 billion for the facility, received R496 million, and spent 56% of it, leaving R381 million unaccounted for. He asked how OBP could now claim R893 million, plus additional funds, to complete the facility when the 2012 figure did not include inflation.

He criticised OBP’s inability to provide clear answers, saying the figures lacked credibility and raised serious concerns. He called for the board and CEO to present accurate, confident data to the Committee, as the current discrepancies made it impossible to present a reliable case to the Ministers of Agriculture and Finance.

Mr A Trollip (Action SA) asked if OBP's closure was complete or limited to the GMP. He raised concerns about a monthly payment of R165 000 for a single person overseeing the facility. He asked about interest on the remaining R150 million allocated but unused, seeking clarity on its growth.

Mr Z Mthethwa (MK) said the issues stemmed from state-private sector arrangements, and legal restrictions on discussing matters under court review. He argued that the private sector had positioned itself to benefit from OBP's struggles, and suggested investigating its role further. He also proposed that the Committee seek legal counsel to move forward without jeopardising the board.

Mr C Smit (ANC) stressed OBP's role in providing reliable animal health products, and criticised delays in vaccine availability, particularly Asiatic red water vaccine, which caused economic losses for farmers. He pointed out repeated missed deadlines, and highlighted operational challenges such as electricity, water, and equipment failures.

Mr Montwedi proposed expediting the court case and finalising the appointment of a principal agent to provide certainty on the facility's costs and progress. He criticised delays in addressing these longstanding issues and suggested the Minister's involvement was slowing resolution.

Ms N Ndalane (ANC) expressed pity for the new board, commenting that they had inherited unresolved issues from previous administrations. She recommended they provide a detailed report to help the Committee support them in engaging with these matters.

Ms S Lucas (ANC) proposed separating governance, management and technical issues, to address them systematically. She raised concerns about sub judice constraints, and suggested the Committee find a way to assist the process without violating legal rules. She emphasised the need to ensure OBP could meet the needs of farmers and veterinarians.

Mr Aucamp asked why the court case between OBP and a supplier was relevant to the discussion. He said Parliament’s role was to identify problems and propose solutions, particularly regarding the GMP facility. He also asked about inconsistencies in OBP’s financial figures, pointing out discrepancies between past and current cost estimates, and requested the board and management to explain the misalignment.

Mr Smit asked whether OBP’s water used for vaccine production complied with testing requirements for microbial contamination, conductivity, organic carbon, and endotoxins. He also asked how often the water plant had been down in the past three months, how OBP disposed of non-compliant water, and about the quality of diluent water. He further asked about tetanus vaccine production, back-order cancellations, and whether compromised vaccines had been discarded.

Mr Aucamp asked for clarity on OBP’s back-order data, specifically if the reported numbers referred to total orders or quantities. He also asked for accurate records of African horse sickness vaccine production, highlighting OBP's claim of 190 000 doses in August compared to about 17 000 doses in October. He requested delivery notes to verify the figures and determine if OBP had misled the Committee.

Mr Montwedi asked why OBP had failed to deliver vaccines on time, and warned that such failures could create opportunities for private manufacturers. He asked what OBP required to ensure uninterrupted supply.

Mr Mthethwa asked whether some Members were receiving insider information to undermine OBP, urging fairness in discussions. He also asked if negative reports about OBP served an agenda to replace it with a private entity.

Mr A Mngxitama (MK) asked that Dr Cloete van Vuuren, from the University of Free State, be invited to discuss claims of deliberate food poisoning. He also asked about OBP’s litigation costs and whether its services were equitably distributed between small-scale and commercial farmers.

Inkosi R Cebekhulu (IFP) asked about the impact of foot-and-mouth disease on subsistence farmers and called for greater support for small-scale farmers, especially those lacking resources like irrigation dams.

The Chairperson asked Members to respect each other’s input and focus on supporting OBP. She acknowledged the importance of addressing food poisoning, but asked to prioritise OBP matters first.

Responses

Prof Mabeta briefly addressed the GMP issue, stating that the figure of R873 788 829 was calculated by Equate, not OBP. She explained that this was an estimate, and the minimum required funds for completion, as reported, was R381 388 829. She emphasised that certainty could be achieved only by appointing a principal agent, but OBP needed shareholder approval to proceed. Once approved, OBP could access ring-fence funds to appoint the agent and get accurate figures.

She referred to the OBP’s challenges in gathering the necessary information, but gave an assurance that the report reflected the board's findings so far. She mentioned ongoing investigations and cooperation with law enforcement. Then she handed over to the CEO to address further measures, adding that the foot-and-mouth disease (FMD) issue would be left to the Department.

Dr Nthangeni said that OBP received various blood vaccines, including red water, Africa, anaplasmosis, and others, from the Agricultural Research Council (ARC) in bulk. These vaccines were tested over two to three months before distribution. Most vaccines were available as expected, except for the red water vaccine, which would be available in January. Some customers requested all blood vaccines at once, leading to backorders. OBP released vaccines only after passing quality control tests, which included tests for sterility, conductivity, and endotoxins.

Regarding water for injection, he confirmed that OBP strictly followed international standards for quality control. If water failed the tests, it was discarded. He said that OBP manufactured water specifically for each vaccine, and any compromised batches were not released. In the case of the African horse sickness vaccine, compromised water was replaced with compliant batches.

Regarding Tustone, which had been off the market for a decade, Dr Nthangeni said that OBP had received approval for a substitute product. Back orders were handled by confirming customer interest before shipping. He added that OBP had recently invoiced over 1 000 units of horse sickness vaccine.

He also mentioned that OBP was acquiring a new freeze dryer to improve vaccine production, with validation expected between January and May. Lastly, OBP provided training to rural and small-scale farmers on proper vaccination practices.

Follow-up questions

The Chairperson said that any information not available at the time should be sent to the Committee Secretary.

Mr Smit raised a question about OBP’s waste control system, specifically regarding the disposal of contaminated or biological waste.

Mr Trollip referred to a discrepancy in the response regarding the availability of the Asiatic red water vaccine. It had initially been stated that the vaccine would be available in the third week of November, but now it was expected in mid-January. He expressed concern about a disconnect, as veterinarians had been informed differently and had not been contacted directly by OBP.

Dr Nthangeni responded that OBP followed a cradle-to-grave policy for waste disposal. It uses an accredited service provider that handles different types of waste, including biological waste. As per the service level agreement, the provider collects the waste as it accumulates and provides OBP with a certificate of destruction after the waste is properly disposed of at a validated facility.

Chairperson's summary

The Chairperson thanked the Department for their responses regarding vaccine production, acknowledging their responsibility to ensure the supply of vaccines. She emphasised that the issue of the GMP needed to be paused, as further questions on that topic might be premature without clarity on figures. She proposed that the Committee approach the Minister as a shareholder to move forward with appointing the principal agent. This would enable OBP to continue with the necessary processes and provide accurate estimates.

She expressed concern about the perception of inside information raised by Mr Mthethwa, stressing that both the Department and Committee Members should remain honest in their engagements. She appreciated the board members' presence, as it allowed them to better understand the frustrations and perspectives of the Committee.

She concluded by urging OBP to prioritise upgrading their facility to ensure they can meet the vaccine needs of South African farmers, some of whom were Committee Members. She reiterated that the Committee’s questions were aimed at understanding and supporting OBP’s progress, and that they were working together as a team.

Presidential Employment Stimulus Initiative (PESI) programme

Mr Nasele Mehlomakulu, Deputy Director-General (DDG): Food Security and Agrarian Reform, presented on the Presidential Employment Stimulus Initiative (PESI), outlining the programme's origins, objectives, implementation phases, and challenges.

He said that PESI, launched in response to the COVID-19 pandemic, aimed to protect vulnerable livelihoods, create self-employment opportunities, and support subsistence farmers through input vouchers. Targeted groups included women, youth, people with disabilities, and farm workers. Key commodities prioritised were fruits, vegetables, grains, livestock and poultry.

In Phase 1 (2020/21), the programme introduced a paperless application process using Unstructured Supplementary Service Data (USSD) codes, allowing farmers to apply via mobile phones. However, this has led to challenges such as fraudulent applications, requiring physical verification of over 50 000 applicants and collaboration with various government departments for data validation. Phase 2 had improved controls to address issues like voucher trading and collusion between beneficiaries and agro-dealers.

By Phase 3, implementation had been decentralised to provincial departments to streamline operations. A custom app, Survey123, was used for geo-referencing and live data capture, even in offline areas. Despite progress, challenges persisted, including connectivity issues, limited input supplier reliability, and late budget allocations.

Mr Mehlomakulu concluded by highlighting uncertainties around future funding, noting that Phase 3 relied on internal budget reallocations rather than National Treasury allocations.

See attached for full presentation

Update on the revitalisation of irrigation schemes

Mr Dipepeneneng Serage, Deputy Director-General (DDG): Agricultural Production, Biosecurity and Natural Resources Management, presented a summary of the revitalisation of irrigation schemes. He explained that South Africa had about 22 million hectares of agricultural land, with only 1.5 million hectares irrigated. Of this, 200 000 hectares were tied to irrigation schemes, and another 250 000 hectares relied on underground water. He highlighted challenges such as group dynamics, land ownership under traditional authorities, and farmers having permission only to occupy the land.

Mr Serage said the National Development Plan (NDP) targets for irrigation were unmet due to two issues: water supply, which falls under the Department of Water and Sanitation, and the lack of clear definitions and data on irrigation schemes. He emphasised that much of South Africa was arid, receiving less than 450 millimetres of rainfall annually, which made irrigation essential for agriculture. However, 60% of the country's water was already used for agriculture, raising concerns about sustainability amid climate change.

He pointed out that most irrigation systems were outdated, relying on dilapidated canals and asbestos pipes, leading to water loss. Repairing these systems would require an estimated R1 billion. He recommended a joint meeting between the Department of Agriculture and the Department of Water and Sanitation to address legislative, funding, and infrastructure issues.

See attached for full presentation

Discussion

Mr Montwedi raised concerns about the Department’s stance on irrigation schemes, particularly its claim that its management and maintenance were not its responsibility, but rather fell under Water User Associations (WUAs). He expressed confusion, commenting that WUAs traditionally handled bulk water delivery to irrigation schemes but did not manage on-farm infrastructure. He questioned when this responsibility had been shifted, as historically, the Department had been involved in addressing infrastructure issues, such as old asbestos pipes and dilapidated canals.

He highlighted specific failures, such as 300 hectares in Pudumo that had been non-operational for seven years due to unresolved issues. He also referred to legacy reports from the Fifth Parliament, and criticised the Department for not following through on commitments to revitalise irrigation schemes. He sought clarity on which schemes were supported under the Comprehensive Agricultural Support Programme (CASP), and how much funding had been allocated.

He had also noted discrepancies between the current presentation and earlier reports in September, which included work on irrigation schemes under Agri-parks. He questioned whether these inconsistencies signalled a split in departmental responsibilities, and called for accountability.

Mr Aucamp referred to the latest gross domestic product (GDP) figures, noting a 0.3% contraction in the third quarter, with agriculture, forestry and fisheries experiencing a significant 28.8% decline. This sector alone contributed 0.7% to the negative growth, primarily due to reduced economic activity in field crops. He attributed this to the ongoing drought, which severely affected planting despite a slight improvement in recent years. Farmers without access to irrigation systems were especially impacted, with some having to replant crops multiple times due to lack of rain.

He said there was a need to expand irrigation systems to reduce dependence on favourable weather and ensure water availability for planting. He called for actionable plans to address this issue, and asked if the Department could provide data on municipalities owing money to water boards or irrigation systems. He cited the Buchuberg Water Board at Groblershoop, where the municipality reportedly owed over R10 million, suggesting that these funds could be used to assist more farmers.

Mr Trollip said the presentation highlighted the failure of small schemes' revitalisation, which aimed to improve rural livelihoods, food security, and poverty eradication. He said this failure stemmed from socioeconomic, political, climate, water, and design factors. The report also pointed to a lack of farmer participation, weak support services, poor management, inadequate infrastructure, theft, high energy costs, and insufficient institutional support, including the collapse of the Land Bank.

He said there was a lack of accountability, citing examples of disappearing infrastructure and equipment misuse. He emphasised the 28.8% contraction in agriculture, calling it catastrophic, and urged the Department and government to act. He asked about the impact and sustainability of the R1.1 billion PES program, stressing the need to evaluate its effectiveness. “How many lives did we change? How many people are no longer hungry? Without measurable outcomes, this expenditure will be a failure,” he said.

Mr Mthethwa said economic collapses, including in agriculture, expose systemic fault lines. He referred to the book South Africa Incorporated: Oppenheimer Empire (1988), which highlighted the concentration of economic power under a single entity, including agriculture. He blamed the corporatisation of the state, where water issues had become privatised rather than a national priority, leading to the Department's failure in handling irrigation schemes.

He proposed applying demographic parity to ownership patterns, arguing that structural inequalities keep the poor in poverty. He said that during COVID-19, funds intended to assist the poor primarily benefited Afrikaner corporations and agro-dealers. The collapse had revealed the concentration of dam ownership by a few, while the majority lacked access to water.

Ms Lucas emphasised the importance of ensuring that programs like the Presidential Stimulus Initiative (PSI) achieved meaningful results, particularly in addressing youth unemployment and supporting emerging farmers. She raised concern about the low job creation figures and inadequate professional support provided through extension services for young and emerging farmers. While acknowledging some success stories in provinces like Mpumalanga and the North West, she stressed the need to highlight and replicate these successes across provinces to improve impact.

She pointed out challenges in disbursing funds effectively, noting a lack of oversight and support to ensure the funds yield sustainable outcomes. She emphasised that the multiplier effect of the program should have impacted far more people, and called for better collaboration between the Departments of Water Affairs and Agriculture to address water scarcity, a critical challenge for both agriculture and communities.

She highlighted the case of a farm in the Kakamas area, where suspended water rights had hindered its potential success. She also raised broader concerns about water scarcity in villages, including her own experience of a prolonged lack of water. She questioned the beneficiaries of irrigation schemes, noting unclear distinctions between commercial and emerging farmers, and insufficient representation of provinces like the Northern Cape in such initiatives.

 She advocated joint coordination between departments to address water rights and irrigation challenges comprehensively, citing the need for clarity on issues like the allocation of the 4 000-hectare water rights for agriculture.

Mr Mngxitama focused on the critical importance of irrigation for agricultural development, especially for small-scale farmers. He highlighted the inequity in resource distribution, where 60% of irrigation resources were accessed by large-scale white agriculture, leaving black small-scale farmers at a disadvantage. He called for a policy shift to ensure a more just and equitable distribution of irrigation resources. He stressed the need for a comprehensive report detailing the crisis, its root causes, and clear solutions, including the required resources.

He emphasised that resolving the irrigation issue was essential for achieving rural development, agricultural modernisation, and broader developmental goals. He also raised concerns about the cost-effectiveness of the Presidential Employment Initiative, commenting that the reported R1 billion expenditure to create approximately 100 000 jobs might result in jobs that were disproportionately expensive. He asked for a breakdown of the costs to better understand the allocation and efficiency of these funds.

The Chairperson acknowledged that issues related to water boards fell under the jurisdiction of the Department of Water and Sanitation. She said information regarding municipal debt to water boards could be clarified only in a meeting with that Department, or its relevant Portfolio Committee, as suggested by Ms Lucas.

Regarding the PESI, the Chairperson requested confirmation that the agro-dealers benefiting from the PESI voucher redemption include new corporations, not just established or old operations. She also asked for clarity on whether Vodacom remained a partner in implementing the PESI programme. She requested detailed data on the agro-dealers involved, specifying their locations by province or, ideally, down to district level.

Responses

Mr Mehlomakulu responded to several key points raised regarding the PESI programme. He explained that the Department had conducted an implementation evaluation to assess the programme’s progress, identify what worked well, and understand areas needing improvement. This evaluation was part of an ongoing effort to refine the programme’s controls and ensure better execution. As the programme had been running for over three years now, the Department was about to commission an impact evaluation to measure the long-term outcomes. Some positive results have already been noted, particularly in Mpumalanga, where the programme had a significant positive impact on activating sustainable livelihoods for participants. However, the outcomes had varied across different regions, which the Department was still assessing.

He also addressed concerns regarding the concentration of agro-dealers in South Africa, an issue flagged by the Competition Commission. The Department had initially attempted to involve new intermediaries to bring supplies closer to farmers, but these intermediaries still had to source inputs from large agro-dealers. As a result, the Department had returned to working with the original agro-dealers, though these intermediaries were considered a new entry point into the supply chain. This move was made to ensure that farmers could access the necessary resources.

Mr Mehlomakulu confirmed that Vodacom was no longer involved in Phase 3 of the programme. The Department had moved away from Vodacom's system, opting instead for a more traditional method of delivering inputs to farmers.

On the issue of job creation, he clarified that the programme was never designed primarily to create jobs, but rather to protect livelihoods. The primary goal was to ensure that individuals, particularly elderly farmers, could continue their agricultural activities by providing necessary inputs. While the program did lead to some temporary job creation during planting and harvesting seasons, this was considered a secondary effect. Despite not being primarily focused on job creation, the R1.1 billion spent on the programme has shown positive results in sustaining livelihoods. The forthcoming impact evaluation would provide a more comprehensive and evidence-based assessment of the programme's overall success.

Mr Serage began by focusing on the role of agriculture and water management in irrigation schemes. He emphasised that agriculture was a concurrent function as outlined in Schedule 4 of the Constitution. This meant that both the provincial and national departments had roles to play in irrigation, but the responsibility for water management before it reached farms for irrigation rested with the Department of Water and Sanitation. He clarified that the management and establishment of irrigation schemes, water associations, and related activities fell under the jurisdiction of the Department of Water Affairs, even though the Department of Agriculture played a significant role in supporting these schemes through funding and resources, such as the Comprehensive Agricultural Support Programme (CASP).

He also mentioned that the Farhad irrigation scheme, one of the largest in sub-Saharan Africa, was under the responsibility of the Department of Water Affairs. The Department of Agriculture, while involved, was not the primary authority in this case. He raised a concern that there had never been a clear session where both the Department of Water Affairs and Agriculture had come together to clarify their roles in these projects, making coordination difficult. In his own province, North West, he referred to an example where he had facilitated a R2 million bail-out for electricity bills owed by farmers in the irrigation scheme. However, there were still numerous unpaid bills, including those owed money to municipalities and Eskom. This situation was not sustainable, and coordination between departments was critical for resolving these issues. The role of provincial, national, and local governments, along with the Department of Water Affairs, should be more clearly defined and acted upon.

Mr Serage also commented that South Africa faced significant water challenges, as it was a desert country receiving less than 650 millimetres of rainfall annually. This made irrigation a vital resource for farming, but only a small portion of the country could be irrigated. He pointed out that areas such as the Northern Cape and North West had some irrigation potential, but overall, the country’s irrigation schemes remained limited. The country had about 200 000 hectares under irrigation, but the National Development Plan (NDP) target had not been met, and the expansion of irrigation was essential for agricultural development.

Lastly, he discussed the issue of water licences, pointing out that some farmers still held licences for water rights even though they were no longer farming. Other farms had been sold without transferring the water rights, leading to a significant problem. These anomalies had to be corrected, and he called for government intervention to address these issues. His intention was not to conceal any problems, but to lay them bare so that the Committee could provide guidance and assistance in resolving the situation. He said that the NDP target for irrigation expansion had not been met, and that urgent steps needed to be taken to address the issue.

Closing remarks

The Chairperson concluded the meeting by outlining plans for the upcoming year. She said the  Committee's intention was to bring together both the Department of Agriculture and the Department of Water and Sanitation to address the concerns raised during the meeting.

Referring to the issue of water rights when a farm was sold, she said that water rights should be transferred along with the farm, but this had not always been the case. These issues would be addressed in more detail during a future meeting in the new year.

She thanked OBP and its board members for their presence and contributions.

The meeting was adjourned.