Departments of Land Affairs & Agriculture Strategic Plans & Budget 2008/09

NCOP Land Reform, Environment, Mineral Resources and Energy

06 May 2008
Chairperson: Rev. P Moatshe (ANC North-West Province)
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Meeting Summary

The Department of Land Affairs briefed the Committee on its Strategic Plan for 2008-2009 and identified key priority areas as fast-tracking land reform delivery by using tools such as expropriation, speeding up formulation of policy and legislation on foreign land ownership and the “willing buyer-willing seller” review, providing comprehensive support to land reform beneficiaries, finalising the state land audit, the implementation of the Communal Land Rights Act and making state land available for land reform purposes.

The Department made it clear that the 2014 target for land delivery was impossible with the current  MTEF allocations.

The DOA tabled their strategy plan for 2008-2011 and looked at the purpose, components, targets and expenditure estimates of each of its five programmes. Much emphasis was placed on escalating food prices. Proposals were made about intervention strategies such as food vouchers, strengthening food parcels and school feeding schemes, social relief for the vulnerable, increasing agricultural production and public- private partnerships and the introduction of more VAT exempt food items.

The Committee asked questions on the land reform shortfall,
Communal Land Rights Act, foreign land ownership policy and vacancies in key posts.

Meeting report

Department of Land Affairs briefing
Mr Mdu Shabane, the Acting Director-General for Department of Land Affairs, outlined nine directives of the 2008 State of the Nation Address which included the efficient implementation of policies and programmes, processing the Land Use Management Bill, finalisation of land restitution matters, the development of rural areas, better service delivery in poorer communities, the improvement of household food support and speed up the land ownership audit and the Land and Agrarian Reform Programme.

These directives
had a direct bearing on the department and influenced the key priority areas in its strategic plan for 2008/09. In discussing the department’s priorities, Mr Shabane emphasised that expropriation, in line with the Constitution, should be utilised to galvanise land reform delivery. He also stated that policy and legislation on access and ownership of land by foreigners was of utmost importance. Other key objectives were the implementation of the Communal Land Rights Act (CLARA), the finalisation of the nation’s land audit, making state land available for land reform, and providing comprehensive support to land reform beneficiaries.

He went into detail about upcoming legislation, providing details on six bills:
the Land Use Management Bill,
Black Authorities Act Repeal Bill
Provision of Land and Assistance Amendment Bill
Surveying Profession Bill,
Deeds Registries Amendment Bill,
Sectional Titles Amendment Bill,
The first three were high priority. 

Mr Shabane looked at each of the DLA’s seven programmes looking at what had been achieved and what still needed to be done in each of them: Administration, Surveys and Mapping, Cadastral Survey Management, Restitution, Land and Reform Tenure, Spatial Planning and Information and Deeds Registration.


Mr Anton van Staden, Acting Deputy Director-General for Corporate Services, tabled the Department of Land Affairs’ Human Resources recruitment plan. He pointed out that as of 18 February 2008, the total employee loss was 1815 and that the vacancy rate was higher than before. He said that even though it looked alarming on paper, these were not actual losses but could mainly be attributed to internal promotions. He added that the department was thriving with the advancement of employees’ careers. He noted that several posts were filled in the Deeds Office and that several other posts were awaiting approval or being re-advertised. Mr van Staden tabled the department’s human resources action plan, which included a graduate programme and stated that it would reduce vacancies by 450.

Mr van Staden provided a comparison of the 2006/07 budget and expenditure per programme with that of 2007/08. He then looked at the Medium Term Expenditure Framework (MTEF) figures for the department’s seven programmes.

Mr Shabane concluded by highlighting the challenges. He pointed out that there was a huge disparity between the 2014 targets for land delivery and the allocated budget for this. The expected projected hectares that they should be delivering per annum could not be met with the MTEF allocation. Looking at the current price per hectare they would not be able to reach the 2014 target. DLA could focus on just buying land with the allocated budget. However he pointed out the danger of giving prime agricultural land to beneficiaries without the means or working capital to make the land sustainable. This would lead to an even worse food crisis than experienced now. However, giving more of the budget allocation to support emerging black farmers would mean buying less land. One either had to look at an extension of the 2014 target or increasing MTEF allocations. Leaving emerging farmers to raise loans themselves meant being very indebted. 

Discussion
Mr C Van Rooyen (ANC - Free State) stated that the department planned to deliver a total of 7,1 billion hectares, yet it appeared that it would only be able to deliver 2,2 hectares over the MTEF period. By his calculations the budget of the department did not seem to suggest that the department would reach its target. The annual increase in the department’s land reform budget from 2004 to the current 2007 financial year was 54%. Strangely over the next MTEF period, the budget increase was only 35% per annum. He thus sought clarity on the reason for the pattern of a decreased annual land reform budget, as it would not ensure achieving the Department’s target. He did not believe that this problem was caused by a failure on the part of the Department to budget properly, as its strategic plan was in line with the 2014 target.
 
The Acting DG replied by thanking the Member for acknowledging the current dichotomy between the expectations placed on the Department and its current budgetary allocation to achieve the objectives.  

Mr Van Rooyen was concerned by the fact that the Department still had an acting Chief Financial Officer, namely Ms Cathy Motsisi. He questioned whether the 18% decrease in the Department’s land reform budget was perhaps attributable to the previous CFO’s lack of proper planning, and expressed his hope that the current Acting CFO would properly address the problem.

Mr van Staden explained why the department had still not filled the position of CFO. The position had been advertised and interviews conducted. The panel led by the Minister had made an appointment. The guidelines issued by the Department of Public Service and Administration dictated a rigorous process of pre-employment screening. Those verification processes had indicated some negative elements with the candidate and it was under investigation. As such the appointment had not been submitted to Cabinet until the verification process was completed. He added that the appointment was priority for the Department. 

Mr Van Rooyen was also concerned by the funds allocated to the Department’s land tenure programme in the current budget, and doubted whether it would allow the Department to reach its stated target. He stated that he would not be surprised if the Department requested additional funding from Parliament for this programme in the next financial year.

The Acting DG replied that this was an area where they were attempting to balance the need for land redistribution and tenure security. Land redistribution received the larger share of the budget within the Department. The reason why there was not a significant amount for tenure reform was because CLARA had not been implemented. Once what was required to implement CLARA was determined, then the budget would reflect directly to tenure reform. 
 
Mr Van Rooyen noted that the Department indicated in its Strategic Plan that it wished to contribute 6% towards the country’s annual economic growth rate, but questioned how it planned to achieve this when it was in fact decreasing its land reform budget.

The Acting CFO replied that the Department got the costing of all their activities that would have to be done to reach the target. Their Strategic Plan showed their shortfall. The Department went to National Treasury and indicated the shortfall that would occur if they were to deliver their target for 2014. The year 2008/2009 would have a shortfall of R2.3billion, 2009/2010 would have a shortfall of R7billion and 2010/2011 would be R11billion. National Treasury had already indicated that R36 billion was to be distributed across the national and provincial governments. Therefore the Department would not receive the amount that they had requested. The capital injections were also insignificant. Through the Land Agrarian Reform Programme (LARP) they had managed to challenge the National Treasury on the matter. It was also taken to the to the precedent level where the precedents were supporting them and advocating for the Department to receive the funds. 

Mr Van Rooyen noted that the Department’s land and agrarian reform programme aimed to redistribute 5 million hectares of white-owned land to 10 000 new agricultural producers, yet it failed to indicate with any detail exactly how it planned to achieve that. He asked whether, for example, an audit had been conducted to verify that there were in fact 10 000 new producers that would benefit from the redistribution.

Mr Van Rooyen stated that the Department’s Strategic Plan aimed to increase the current number of black entrepreneurs by 10%. Yet he was not of the view that the Department’s budget adequately addressed this objective because, as stated earlier, the Department was decreasing its land reform budget.

The Acting DG replied that LARP was not a programme of the Department but a program for the Ministry of Agriculture and Land Affairs including the nine provincial departments of agriculture. The funds to support the farmers would be from National Agriculture and the provincial departments. The increase in production was the responsibility of the Department of Agriculture and the private sector and civil society.

Mr Van Rooyen informed the Committee that since he first became a Member in 2004 the Committee had constantly been dealing with CLARA. The Acting DG indicated in his presentation that the Department was busy finalising the legislation. The President mentioned in his 2007 State of the Nation Address that CLARA would be finalised then, yet in 2008, one year later, it had still not been finalised. He sought detailed clarity on the reason for the delay in implementing the legislation

Mr Shabane replied that CLARA was passed in 2004 but then the development of the regulations had taken quite a long time, 2004 to 2008, to be completed. One complication that arose after promulgation was that there were those who deemed CLARA to be unconstitutional. Last year the Department went to the Minister and Deputy Minister and suggested that they continue with CLARA until they were stopped by a court interdict. They had only received the court papers in 2006 and the Department had to prepare their affidavit. The court date had been set for October 2008.

Mr Van Rooyen sought clarity on exactly where within the Department, the “national war room against poverty” referred to by the President was located, as the Department’s budget did not seem to address it at all. He was of the view that the Department’s budget did not appear to seek to actually improve the quality of life of South Africans.


The Acting DG replied that the Department of Social Development and the social cluster were responsible for the ‘war room’. The Department would contribute but would not have their own ‘war room’.

Ms B Dlulane (ANC – Eastern Cape) was concerned with the vacancy level and asked when would the posts be filled. 

Mr Van Veeren’s answer referred to a new office in Limpopo and the surveyor general. That was a new office and the post of surveyor general needed to be filled. It was a scarce skill. The surveyor general in Pretoria had done the work for Limpopo. 

 

The Chairperson asked for an explanation about the 300 people who had resigned.

Mr Anton Van Veeren replied that the vacancy rate described as normal was between 7 to 5 percent. The people that resigned were due to the fact that there was internal competition. They were losing staff for career growth in other departments. There was a mechanism in place to retain staff.

Ms Dlulane noticed that slow land delivery needed additional budget however this was the portion of the budget that had been decreased. The Committee felt that land restitution was important. She asked about those claims that were granted but were experiencing disputes. How were disputes dealt with in the budget? Were there measures for this in the budget?

 

The Acting CFO agreed that the budget for restitution would decrease. The Strategic Plan for Land Restitution stated that the budget was in line with number of outstanding land claims.

 

A departmental representative replied that the numbers that had been projected was consistent with the number of claims. The bulk of the remaining claims would be settled in the current financial year. When resources were allocated for the settlement of the claim it was done for the total settlement of the claim. If a dispute arose funds were not lost, but remained with the Department until the dispute was resolved and the funds could then be disbursed. 

Ms Dlulane asked about the R1billion that had been transferred back to Treasury in 2006 because the Land Restitution Commissioner was unable to spend it. Ms Dlulane asked why Treasury did not want to increase the Department’s budget. Ms Dlulane hoped that there would be measures in place to support those that wanted to develop their land. She then asked for an update on the policy for land owned by foreigners.

 

The Acting CFO replied that National Treasury had returned the R1billion, R600million had been allocated in 2009/2010 and R400million in 2010/2011.

 

Mr Van Rooyen commented that there could not be a saving since the Department was not a profitable company. The notion that under spending was a saving was incorrect, actually when under spending occurred somebody had suffered. He wanted to eradicate such notion.

In response, Mr Shabane said that a new Bill might be required to give adequate effect to this policy, this included when people registered at the deeds office and had to declare their nationality. Originally they had assumed that they could amend existing legislation. However there had been recent engagements with experts in this area and they had recommended that a new Bill be developed. Such a Bill could not be tabled this year but rather in 2009. In terms of state owned land, it was within the control of the ministry.

 

The Chairperson added that it was a pity that there had not been a regulatory law at the advent of democracy, that is, at the time of the interim Constitution, for landowners to first declare their nationality. This had placed a greater strain on the Department of Land Affairs. He found it difficult to fathom why legislation had to be developed at this stage.

The Acting DG replied that at the time of the interim constitution the country wanted to eradicate discrimination and as a result any legislation discriminating according to race was overhauled. If there had been a more definite legislation the Department might have been able to facilitate land ownership. Foreign ownership of land had become more evident in the last five years and the government had not had legislation to impede it.

 

The Acting CFO added that when government decided to develop legislation they had gone to the deeds databases to establish how much land was owned by foreigners and according to the different racial groupings. It was discovered that in 1994 all legislation that was considered discriminatory was removed and that resulted in nobody disclosing their nationality or their race. This was done to such an extent that monitoring of land reform was difficult.

 

Ms Dlulane commended the Department on their improvements. 

 

The Chairperson hoped that there would be delivery of land to the people.


Department of Agriculture briefing
Dr Kgabi Mogajane, Acting Director-General for the Department of Agriculture, tabled the Department’s strategy plan for 2008/9 – 2010/11. The plan comprised five programmes and the Budget Vote 23 estimates of expenditure for the financial year 2008-2009.

Dr Mogajane placed much emphasis on escalating food prices, attributing it to factors such as fuel price hikes, trade restrictions, global grain shortage and unfavorable climatic conditions. She tabled several Agri-business costs. She looked at how countries such as Argentina, Zambia, Australia, China, India, Brazil and the USA, were combating food price escalation. Countries like Morocco, Saudi Arabia, Bangladesh and Mexico were also looked at. She proposed several intervention strategies to the committee. These were food vouchers, the strengthening of food parcel and school feeding schemes, social relief for the vulnerable, increasing agricultural production and public- private partnerships and the introduction of more VAT exempt food items.

Dr Mogajane discussed the department’s strategy on Apex Project 7 on Land and Agrarian Reform Programme (LARP).

The purpose, components, targets and expenditure estimates of the Livelihoods, Economics and Business Development (LEBD) programme was explained by Mr Sam Malatji,
Acting DDG for Livelihoods, Economics and Business Development.  

Dr Mogajane went through the purpose, components, targets and expenditure estimates of the Biosecurity and Disaster Management (BDM) programme. The purpose of this programme was to manage any risks associated with animal disease, Genetically Modified Organisms, and agricultural products. Planned expenditure for Plant Health and Inspection Services was R169 million and Food, Animal Health and Disaster Management was R139 million.

Dr Motseki Hlatshwayo,
Senior Manager for Animal and Aqua Production, tabled the Production and Resources Management (PRM) programme aimed at optimising agricultural productivity and turnover. Its expenditure for agricultural production was R57 million.

Ms Vangile Titi,
Deputy Director-General: Sector Services and Partnerships, discussed the programme for Sector Services and Partnerships (SSP).

Mr Tommie Marais (Chief Financial Officer) discussed the Budget Vote for Agriculture, including the Estimates for National Expenditure allocation for 2008-2009 and the estimates for each programme. He also did a summary per economic classification. He added that the increase in compensation of employees was due to strikes and higher income for employees.

Ms Dlulane commended both the departments for their input.

The Chairperson thanked all relevant stakeholders and the meeting was adjourned


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