Forestry Transformation and Beneficiation: Department briefing

Water and Sanitation

24 August 2006
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Meeting report

WATER AFFAIRS AND FORESTRY PORTFOLIO COMMITTEE
25 August 2006
FORESTRY TRANSFORMATION AND BENEFICIATION: DEPARTMENT BRIEFING

Chairperson:
Ms C September (ANC)

Document handed out
Forestry Transformation and Beneficiation: Presentation from The Department of Water Affairs and Forestry

SUMMARY
The Department of Water Affairs and Forestry briefed the Committee. The presentation briefly gave the background to the issues and then highlighted the challenges of transformation and land reform in the forestry sector. There had been slow progress in land reform which had impacted upon the Department’s ability to distribute in line with restructuring objectives. However, the Department would be spending to rehabilitate Category B and C Planting so that they were in a position to generate an income. There was a need for the State to continue to play an influential role to ensure sustainability, and to ensure assets were transferred to the land reform beneficiaries.

Questions raised by members related to loss of jobs, post transfer support, the extent to which BEE objectives were met, land claims, the Department’s targets and how it assessed its progress, joint committees and initiatives in the sector, and reforestation programmes. The Committee proposed to have a workshop and public hearings to clarify matters on land reform.

MINUTES
Briefing by DWAF: Forestry Transformation and Beneficiation
Mr R Mashaba (Director General: Department of Water Affairs and Forestry (DWAF)) reported that a forestry company, SAFCOL, was established in 1992 as a result of market failure. By 1996, the Government had decided to exit from commercial operations and focus on the efficient management of natural forests, regulatory role and sector leadership. It seemed that there was a need to privatize, and therefore DWAF established restructuring objectives that would advance black economic empowerment (BEE), and optimise forestry land and land reform.

Mr Mashaba tabled the level of BEE participation in Category A of the sector. DWAF had failed to distribute R16 million and attributed its failure to the slow progress in land reform implementation. DWAF also pointed out that the high cost of litigation and the non-fulfillment of promises by operators (to communities) were some factors that undermined the restructuring process.

Mr R Mashaba committed the Department to spending vast sums of money to rehabilitate Category B and C Planting so that they were in a position to generate an income. Importantly, he emphasised the need of the State to continue to play an influential role to ensure sustainability, and in particular that the assets to be transferred to the land reform beneficiaries. Lastly, he stated that he would not be dealing with the licensing issue because it was not part of the restructuring process, even though he believed that it should have been.

Discussion
The Chairperson commented that DWAF should have dealt with the licensing issue. 

Mr W Smith (DWAF, Western Cape) expressed the view that while DWAF was the custodian of the Water Act, there were other important role players like the provinces and municipalities that needed to be part of the process.

The Chairperson indicated that she was unsatisfied with the answer, and asked whether DWAF was able to make inroads using licensing as a tool to reverse and transform whatever was lacking.

Mr J Arendse (ANC) reminded DWAF that the Committee had forecast job losses.

Mr Smith regretted the loss of jobs and blamed the operators for ignoring agreements and guarantees.

Mr Machaba remarked that calculations on the remaining plantations showed very little job losses.

Mr J Arendse argued that while the report indicated that the wage bill had been reduced, the burden on government would not be reduced.

Mr Smith acknowledged that the department only looked at how it would be affected and failed to consider the socio-economic impact.

Mr J Arendse queried what post-transfer support entailed.

Mr Machaba elucidated that it consisted of technical advice, financial advice or any other assistance after the transfer of ownership rights.

Mr I Mogase (ANC) wanted to know what type of workers had lost their jobs.

Mr Machaba answered that it was mainly labourers who lost their jobs. He was not certain whether people were dismissed or retrenched prior to the moratorium. He believed that government must be reimbursed if it was prior to the moratorium.

Mr I Mogase asked whether the department was meeting its BEE objectives.

Mr Machaba explained that the 6% tabled in the presentation should be considered part of 10% and that the 9% target had not been actualized. He agreed that DWAF and the Department of Public Enterprises (DPE) had an obligation to fast track these objectives.

Ms M Mourie-Maine (ANC) sought clarity concerning how many land claims had been finalised and how many were outstanding.

Mr T Mawatji (DWAF representative) responded that there were 200 land claims for Category A plantations, of which none had been resolved. He stated however that that some of these cases were at an advanced stage and that while communities had been identified, there were problems in transferring their rights into ownership rights.

The Chairperson asked how DWAF ensured that it was meeting its targets as set out in its strategic plan at the beginning of the year.

Mr David Mahlobo (Transformation: DWAF) replied that all senior managers met on a quarterly basis to do performance monitoring.

The Chairperson sought to establish whether there were any joint committees between DWAF and the Department of Land and Agriculture to deal with the land issue.

Mr Mawatji responded in the affirmative. He maintained that there were joint agreements and joint committees that met to discuss land reform and land tenure.

Mr J Arendse interrogated the department about its level of progress with regards to reforestation.

Mr Machaba voiced his support for the initiative. He pointed out that the department was consulting communities and educating them.

The Chairperson reiterated the negative impact that land reform was having on all the other issues and proposed a workshop and pubic hearings to clarify matters. She mandated Mr J Arendse to organise a discussion between this Committee and the Portfolio Committee on Environmental Affairs and Tourism.

The Chairperson then asked DWAF to prepare an answer, for the next meeting with the Committee whether South Africa had any relationship with an African country that had significant forestation.

Lastly, she expressed interest in the outcome of the investigation into non-compliance with agreements. She asserted that government could not allow this to go unpunished and that proper restitution must take place.

The meeting was adjourned.

 

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