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AGRICULTURE AND LAND AFFAIRS PORTFOLIO COMMITTEE
22 August 2006
COMMISSION ON RESTITUTION ON LAND RIGHTS: FINALISATION AND ADOPTION OF ANNUAL REPORT;
COMPREHENSIVE AGRICULTURAL SUPPORT PROGRAMME (CASP): FURTHER MEETING WITH DEPARTMENT OF AGRICULTURE; LAND SUMMIT RESOLUTIONS: PRESENTATION BY DEPARTMENT OF LAND AFFAIRS
Chairperson: Ms D G Hlengethwa (ANC)
Documents handed out:
CASP Presentation by Department of Agriculture
Land Summit Resolutions Presentation by Department of Land Affairs
Notes on the Willing Buyer Willing Seller’ approach prepared by Department of Land Affairs
National Land Summit Report
The Committee had listened to a presentation the previous week, and now formally adopted the Annual Report of the Commission onRestitution of Land Rights.
The Department of Agriculture presented a report on the progress made in the Comprehensive Agricultural Support Programme, which summarised the allocation and expenditure for 2004/5, and gave notes on the implementation performance for 2005/6. It was clear that progress was slow and many of the challenges in 2004/5 remained in the following year. Some provinces had finalised their allocations but North West Province was having problems implementing the programmes. A Special Task Team had been set up to assist the province. Challenges included lack of capacity, lack of understanding of procurement procedures, poor planning and lack of understanding of the programme. Many provinces struggled to spend in the first and second quarters. There was still no alignment with MAFISA. 70% of the programme was allocated for land reform beneficiaries. Members raised questions on the way in which support should be given and its value assessed, the number of land reform projects, the scope of the schemes and whether they would offer support also to farmers who did not necessarily want their own land immediately. Several members questioned the capacity problems and procurement and training procedures. It was clear that assessment and control needed improvement. The Chairperson commented that the Department needed to check on the provinces.
The Department of Land Affairs gave a presentation on the Land Summit Resolutions and an overview of the Willing Buyer / Willing Seller principles for land acquisition. The background and recommendations of the Land Summit Resolutions were tabled. The progress made on certain issues was outlined, and the issues addressed by them described, under the headings of policy, legislation, implementation, and internal department initiatives. Policies on land tax, human settlements, post settlement support framework and foreign land ownership were briefly set out and discussed. Questions were raised on the benefit of land tax, the pricing of land, the use of estate agents or other agents to purchase land on behalf of government, certainty of tenure, marginalized women and monitoring of illegal evictions.
Commission on Restitution for Land Rights: Adoption of Annual Report
The Committee had seen the presentation of the Commission during the previous week.
The Annual Report was now formally adopted.
Comprehensive Agricultural Support Programme: Presentation by the Department of Agriculture
Mr Attie Swart (Chief Programme Officer, Comprehensive Agricultural Support Programme (CASP), Department of Agriculture (DOA)) presented a report for the Committee outlining the Department’s progress on CASP. The report summarised the allocation and expenditure for 2004/5, and gave notes on the implementation performance for 2005/6. It was clear that progress was slow and many of the challenges in 2004/5 remained in the following year. Some provinces had finalised their allocations but North West Province was having problems implementing the programmes. A Special Task Team had been set up to assist the province. Challenges included lack of capacity, lack of understanding of procurement procedures, poor planning and lack of understanding of the programme. Many provinces therefore struggled to spend in the first and second quarters. There was still no alignment with MAFISA. 70% of the programme was allocated for land reform beneficiaries. Figures on allocation, expenditure and rollovers were presented for the 2004/5 and 2005/6, as well as the first quarter of 2006/7 financial years.
Mr P Ditshetelo (UCDP) commented on the lack of capacity in the Northwest province. He asked how many farmers had been assisted through CASP, and asked for a more detailed explanation whether the problem of capacity had been rectified.
Mr Swart responded in general to the questions. He said that the full impact of CASP, measured in terms of numbers of projects assisted, would only be available in the mid-term review, but conceded that on the whole it had been disappointing.
Mr S Abram (ANC) commented that he had found the report generally disappointing. Empowerment would not result from major enterprises; success would rather be measured by supporting small ventures in agriculture to grow.
Mr Abram stated that it was understandable that provincial departments should not merely spend for the sake of spending, but rollovers indicated that the budgeting process had not been consistent.
Mr Swart reported that when DOA had followed the money-trail to ascertain effectiveness it had found that in some cases the funds had been “parked” elsewhere. The money was awarded to the provinces on a quarterly basis, to avoid an end-of-the-year rush to spend or park money. DOA had received the reports from the provinces, and there was no reason not to believe these reports, but it became clear that DOA needed to go to the provinces and investigate everything in detail. He added that although he understood the concerns about under-spending, this was at least preferable to inefficient expenditure.
Mr Abram commented that the Committee would need to see the respective MEC’s to discuss capacity in provincial departments. He asked for specific information on procurement procedures, the number and success of land reform projects. He stated that it was important to determine whether farmers were making a living, and follow through the Shabanele process including the financial side.
Mr A Nel (DA) also commented on the lack of capacity. He did not believe it would be necessary to see the MEC’s, but that affected people should know this was an option. He added that there needed to be coordination between the programmes of Land Redistribution for Agricultural Development (LRAD), CASP, and Micro-Agricultural Financial Institutions of South Africa (MAFISA)
Ms B Thompson (ANC) said that the department itself seemed to lack full understanding of the programme . She commented that the committee has been complaining about lack of capacity since 1994, and the resources were available, and asked when it would be achieved. She also asked why extension officers were not being trained so that their jobs were properly done.
Ms B Ntuli (ANC) questioned the lack of procurement procedures, and the lack of understanding of the programme by the department. She asked what precisely was it about the programme that the provinces did not understand. She stated that people should be trained, or should leave.
Mr A Swart commented that there were teething problems, but he did not believe it could be said that there was poor planning at the present moment. He said that DOA had some information, as yet unverified, indicating that there were 53 000 beneficiaries in 1 200 projects. At the end of the year DOA would look at the quality of the expenditure.
Mr S Abrams (ANC) asked how many people had lost their land. He pointed out that in Ladysmith DOA had apparently put a farm on auction then bought it back itself, and in Tzaneen a farm was purchased for R1 million, but sold for R125 000. He commented that some farmers had experienced workers on their land, and were willing to act as mentors when those farm workers acquired their own land. He asked whether DOA had a policy in the land reform process to assist people with a definite flair for farming, as opposed to assisting only those who wanted their own land.
Dr A Van Niekerk (DA) believed that assessment and control must take place at ground level. He felt that the top-down approach of DOA was incorrect and they should rather take advice from those “on the ground”.
Ms B Ntuli (ANC) stressed that DOA must check the provinces regularly, even if this would cost more money, and that DOA needed to interview the provincial Director-Generals to assess what work they were doing to correct the current situation.
Adv S Holomisa (ANC) commented that there were too many failing projects in CASP.
Mr A Nel (DA) said that he would be more interested in knowing how many projects had been successful than in hearing how many beneficiaries there were.
The Chairperson commented that it seemed vital that DOA set up meetings with the provincial Director-Generals.
Resolutions from Land Summit, and Notes on the Willing Buyer / Willing Seller principle: Presentation by the Department of Land Affairs
Mr Mduduzi Shabane(Deputy Director General, Land and Tenure Reform:Department of Land Affairs(DLA)) outlined the Resolutions from the Land Summit and presented the Department’s Notes on the Willing Buyer Willing Seller principle. He gave the background to the Land Summit recommendations. These had included redistribution of 30% of agricultural land by 2014, land reform contributions to economic growth and transformation, and support for small scale agriculture and promotion of subdivision of agricultural land. The principle of willing seller / willing buyer (WSWB) needed to be reviewed, and state capacity and resources needed to be enhanced in a sustainable way. Strategic partnerships would have to be formed between the State, social movements and other stakeholders. The new approach also required that farm dwellers benefited from land reform, that the process be decentralised and integrated into wider development priorities. The State needed to conduct a land audit, regulate ownership by foreigners, and prioritise restitution.
Mr Shabane stated that a national, broad based steering committee had been established and terms of reference developed. Technical task teams had been established. Policy issues under review included the WBWS principles, land tax, expropriation and compensation, post-settlement support, evictions and security of tenure, sustainable human settlements, moratorium on evictions, communication strategy, review of legislation. Implementation issues included acquisition, land audit, settlement initiatives were listed and explained.
A short presentation was given on the Willing Buyer / Willing Seller principle, setting out what it meant in general and what it meant in South Africa. The distinction was clearly drawn between restitution and redistribution. The delivery statistics were set out for 1994-2004. Comparisons were tabled of the prices paid in the market and the prices paid under the restitution and redistribution programmes. Delivery graphs covering 1994-2004 were also tabled. Mr Shabane concluded that WBWS had constrained delivery in agricultural and peri-urban land only. Pro-active land acquisition needed to be implemented in these areas. The principle was ideally suited to other areas. Restitution prices were escalating and therefore expropriation could be a tool to contain escalating costs.
Dr A van Niekerk said that new farmers used the land they received as collateral for financing, and if the value of that land came under pressure, this put the financing system also under pressure. He felt that a Land Tax would put another burden on farmers’ profits and viability. He suggested that DLA should rather increase the budgets for acquisition in order to avoid putting the financing system under pressure.
Mr Shabaneresponded in general that DLA was constrained by the Willing Buyer / Willing Seller (WBWS) principles. If the state wanted to achieve the 2014 targets it would have to use many instruments, and WBWS would only be one of them. Land tax was an incentive, as well as a land ceiling; without which it would take a very long time to balance the current ratio of land ownership. He added that DLA would deal with willing sellers first, and then the second phase would deal with those who were not willing sellers. He cited an example in Limpopo where negotiations went on for between three and five years but willing sellers only emerged when the possibility of expropriation was mentioned did willing sellers come forth.
Mr Abram said that the government must not be willing to pay any price for land. If the prices for farms were too high then there should be a law that that could be invoked to keep the prices reasonable. He did not agree with Dr A van Niekerk’s suggestions, as he felt that the value of the land should be based upon what it could produce, not on what the government was willing to pay for it. This should be the deciding factor when farmers sought finance and offered their farms as collateral. He also said that no estate agents should be allowed to enter the process.
Mr Shabanecommented that there had been a suggestion that DLA should consider using estate agents, and a proposal and presentation had been made but that there were no agreements.
Mr Nel suggested that the government should use an agent, not an estate agent, to place a bid, in order to screen the identity of the buyer. He emphasised the importance of the farmers’ certainty of tenure.
Mr Shabane concurred that prices tended to rise once it was known that the government was the buyer. DLA could not follow the example of Brazil, as South African beneficiaries often did not have sufficient education to negotiate, so that prices agreed upon between beneficiaries and farmers would invariably be too high. He added that legislation on security of tenure was already at an advanced level.
Ms C Nkuna (ANC) enquired about the importance of marginalized women in the DLA’s planning and actions.
Mr Shabane stated that emerging women farmers were represented in talks by an alliance of land reform and social movements. The committees on which they were represented had a fairly cumbersome structure because so many groups were involved, including The World Bank, and it was difficult to get everyone together at the same time. He concluded by saying that legislation concerning the security of tenure were already at an advanced level.
Ms Ntuli (ANC) enquired about farm dwellers, and emphasised the importance of a system to monitor illegal evictions.
Mr Shabane stated that on the issue of farm dwellers and evictions DLA needed to see a show of good heart from landowners.
Ms Nkuna asked how much longer such a wait would be, as the show of good heart had already been long in coming.
Mr M Shabane clarified that the Department could not wait forever. Over the years farmers had successfully legally evicted people. With the right legislation DLA could close that gap.
He stated further that people would not just be given land, but that they would be nurtured in the farming process. This had also been done in previous years. He wished also to make some further comments to clarify that expropriation did not in itself diminish the land value once expropriated. Expropriation would be based on the constitution. Factors taken into consideration included how much the current farm owner had initially paid for the land, market values, and the farm’s current value.
The meeting was adjourned.