Land Affairs Department & Commission on Restitution of Land Rights Annual Reports 2007/08

Agriculture, Land Reform and Rural Development

18 November 2008
Chairperson: Mr MR Mohlaloga (ANC)
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Meeting Summary

The Department of Land Affairs briefed the Committee on its Annual Report for 2007/08, describing the various initiatives taken during the year, the progress and achievements of each of the programmes, some of the concerns, and the financial statements. It was noted that the Department had received a qualified report and the Department took the Members through the qualifications, setting out the corrective action that had been taken. Finally it gave a general overview about what it intended to do, and reiterated that it remained committed to the targets of transferring 30% of formerly white-owned land by 2014.

The Commission on the Restitution of Land Rights also gave a detailed presentation on the Annual Report, setting out its major achievements, the claims settled to date, the expenditure, the numbers of claims still outstanding, a breakdown by province and an indication of the challenges faced.  In a separate presentation it detailed the settled claims by province, in the current year, the cumulative achievements from 1995 to date, the analysis of land value and the fact that there was still a need to standardise land prices. The challenges were highlighted as complex claims with numerous challenges, including claims that were still in the Land Claims Court., disputes involving communities as well as Traditional Leaders on issues of jurisdiction, and the excessively high cost of land. Further problems presented themselves around high land costs, the fact that the State was spending more to settle fewer claims, the need to expropriate, challenges with traditional leaders, boundary disputes and other departments’ unwillingness to release State land. 

The Committee was quite critical of the presentations, noting that the presenters appeared to have produced two “glossy books” but the content did not reflect many of the concerns of the members of the Committee. In particular, questions were raised about the Department’s effectiveness, especially correlating this to the high rate of vacancies and which was exacerbated by the shortage of skilled capacity. Other points raised more than once were the slow progress of restitution, inadequate assistance to beneficiaries after settlement of their claim, the practice of contracting consultants and the resulting financial drain, and the qualified opinion of the Auditor General on the shortcomings of the asset register.  Members further questioned the seemingly arbitrary movement of funds, the use of racial identification for claimants, and the results of fluctuation in cost of land due to time lapses in the negotiation between claimants, owners and the department. The Committee acknowledged that some of these problems had a history before the appointment of the current Director General, and expressed a hope that a new phase of success awaited the Department now that this appointment was in place.

 

Meeting report

Commission on the Restitution of Land Rights (the Commission) Annual Report 2007/08
Mr Andrew Mphela, Chief Land Claims Commissioner, briefed the Committee on the Annual Report of the Commission on Restitution of Land Rights (The Commission). He summarised the settlements effected by the Land Claims Commission (the Commission), saying that up to 31 March 2008, the Commission had settled a cumulative total of  74 747 claims, which amounted to 95% of all the claims lodged with the Commission. A  total of 432 226 hectares of land was delivered to restitution beneficiaries during the year under review.

The total budget for expenditure for the Commission amounted to R3.6 billion, with R3.3 billion spent on restitution awards, financial compensation and the purchase of land.

Around 4900 claims were still outstanding. These were complex claims with numerous challenges, including claims that were still in the Land Claims Court., disputes involving communities as well as Traditional Leaders on issues of jurisdiction, and the excessively high cost of land.

A summary was then presented of the majority of the outstanding claims, and it was noted that the Commission had planned to settle a total of 2585 claims during the new financial year. About 2% of the outstanding claims would be difficult to settle as a result of the nature of the challenges. The Commission did continue to engage with all stakeholders to try to resolve the challenges and had also made a submission to Cabinet on the issue of time and extra funding to process the outstanding claims.

The Settlement Implementation Support (SIS strategy) focused on the provision of a comprehensive settlement support to the beneficiaries of the land reform programme by role players from the public and private sectors, in order to ensure the sustainability of projects handed over to beneficiaries. It was fully described, and would be implemented as part of the Land and Agrarian Reform Programme (LARP).

Mr Mphela went on to speak of the staff retention strategy, and the continued commitment of the Commission to deliver land and put land rights in the hands of the people. The restitution process continued to make a positive contribution. About 142 766 individuals had benefited so far.

Mr Mphela gave an overview of the financial perspective (see attached document) and then moved to the highlights of the settled claims, per province. 

he noted that the Commission was currently focusing on finalisation of outstanding claims and settlement support. The target was to settle 97% to 98% of all outstanding claims by March 2009. He noted that this included 145 claims that were still in the Land Claims Court due to disputes on issue of validity. Experience in other countries and South Africa showed that these claims took long to finalise. However, the Commission had engaged with the Land Claims Court to decide what could be done for speedy resolution.

Mr Mphela said that there remained many challenges around high land costs. The State was spending more money to settle fewer claims, due to the high cost of acquiring land for the purpose of land reform. It was forced to resort to expropriation of land in order to fast track the settlement of claims where there are disputes on the issue of price, and 53 Notices of Possible Expropriation had been served. The Commission engaged with land owners through Agricultural unions towards finding solutions to the challenges.

Other challenges that were highlighted and explained included challenges with Traditional Leaders, boundary disputes, and State land release by other departments and institutions. It was noted that the Commission was reviewing current strategic partnerships and looking at private/public partnerships for solutions. A joint strategy between the Commission, Department of Land Affairs, and the Department of Agriculture was in place to resuscitate struggling projects. There had been applications for funding from Treasury. Agreements with stakeholders were described.

Mr Mphele then described the Corporate Governance issues, noting the meetings in which the Commission participated, the staff retention strategy, international links, and the quality control and risk management.

In a separate report, the status of settled claims was given, broken down by province, listing the cumulative achievements from 1995 to 2008, and giving an analysis of land value. He noted that the 2008/09 land delivery target was 1 million hectares, but the land delivery contributed to 30 September 2008 was 106 368 hectares, which represented 11% of the target. The average land value included prices for crops, but there was a need to standardise these prices for the Department, which was the largest purchaser of agricultural land.

Department of Land Affairs (DLA) Annual Report 2007/08 briefing
Mr Thozi Gwanya, Director General, Department of Land Affairs, briefed the Committee on the Annual Report of the Department of Land Affairs (DLA). He noted that the DLA was to contribute to poverty alleviation and economic development, and give enhanced access to land by people living on farms to improve livelihoods and economic opportunities. The DLA was also to develop capacity building models and programmes for land reform beneficiaries. The target remained redistribution of 30% of white-owned agricultural land by 2014, provision of tenure of security, land for sustainable human settlements, efficient land use and land administration services,  provision of efficient State land management that supported development, and provision of a skills development framework for land and agrarian reform.

He then described in detail the progress on each of the programmes (see attached presentation) and set out the challenges or weaknesses and the strategies to address them. In respect of the financial performance, the expenditure trends over six years were set out, and a comparison of spending across programmes for the past and current financial years. It was noted that this Department had received a qualified audit opinion, because of rental revenue, interest received on revenue and pre-payments, the balance of the grants, the capital asset and the biological assets. Each was detailed in full and the actions taken were described. It was emphasised that efforts were also being taken to address the internal control weaknesses identified by the internal audit. It was noted that 99/5% of the allocated budget had been spent and there would be a shortfall in the current year

Discussion
Mr D Dlali (ANC) asked why for three provinces there was one commissioner, and why he was in an Acting position.

Mr Gwanya responded that the processes had been completed and that the appointment would be made shortly.

Mr Dlali asked for information on the Port St Johns claim, saying that the Annual Report did not make any mention of this claim at all.

Mr Gwanya reported that this claim was now being finalised, and the registration of the land was currently being done. 

Mr Dlali asked for an explanation on transfer of subsidies for a period of six months, the expenditure on household equipment, and the spending of R11.7 million on something that was merely described as “goods”.

This question did not appear to have been specifically answered.

Mr Dlali asked why the majority of outstanding claims were from Kwazulu Natal.

Mr Mphela replied that Kwazulu Natal was a complex province, and that a number of the claims from here were similarly of a complex nature.

Mr Dlali was concerned that the goals set for March 2009 would not be achieved if the percentage of vacancies persisted. He said that progress was slow, particularly in the Eastern Cape, and he asked for a full report.

Mr Gwanya noted that he faced a particular challenge in having joined the Department at this stage, when staff capacity was of huge concern. He said that the type of work called for a particular type of person: those appointed to the position needed to possess both business acumen and negotiation skills. The particular need to fill those vacancies with those skills would be reflected in the current advertisements of the Department.

Mr Dlali asked for a list of the farms made available for re-distribution in the Eastern Cape.

Mr Gwanya replied that a written response would be given.

Mr Dlali noted that he wished to query whether the Department had followed up on a company, SAFM, who had been contracted to the DLA, and who apparently had not made any payment after collecting money on behalf of DLA.

Mr Gwanya noted that this company had been placed under provisional liquidation. The Department of Agriculture was approached in regard to the issue, and it was also involved in assisting.

Mr Dlali commented that the internal controls at DLA were severely lacking, and called for a detailed report.

Mr Gwanya replied that his Department was very hard at work to correct the admitted lack of internal controls. The Department was very concerned to put proper systems in place. An internal audit would assist in correcting the problem.
 
An ANC Member asked how it was possible that the appointment of the Commissioner improved staff morale, if the staff had expressed that they had certain challenges to face with the Commissioner. He asked that this statement, which was noted on page 17 of the report, be clarified.

No specific answer was given to this question.

The Member asked for the number of outstanding claims, and asked when it would be gazetted.

Mr Gwanya indicated that he would give a written response to this question.

The Member said that it had been reported in the previous Annual Report that the Commission had a shortage of human resource capacity. This was again being reported this year. He said that there seemed to be not only a shortage but rather a real need to have well-capacitated staff. He wanted to know what course of action would be taken to address this situation.

Mr Mphela noted that there was a problem in under-performance. However, it was very difficult to dismiss staff from their posts. There were some who did not actively do anything wrong, but simply seemed to drag their feet and this remained a challenge.
 
The Member  asked for clarification of the statement “facilitate speedy reform” that was contained in the presentation when referring to the Land Claims Court.

This question was not answered.

The Member noted that the R4 billion Dube claim required further explanation and he asked that more detail be provided.

Mr Mphela noted that a written response would be given to this matter.

The Member said that on page 211 of the Annual Report of the DLA, the consultants engaged by DLA were listed, but that some entries were repeated on another page. He wanted to know whether these were a result of various payments for the same invoice or if there was another reason.

Mr Gwanya clarified that there was duplication of some of the listed amounts on pages 215 and 217 of the Annual Report. However, by the time this was noticed the Report had already been with the printers. A new database was being worked on currently, and this would enable DLA to have a complete list of consultants.

The Member noted that although consultants were used by DLA, that there was little evidence of historically disadvantaged individuals being contracted in or consulted. He noted that South Africa’s democracy had already been in place for nearly 15 years, but the progress made was questionable, and he asked for an explanation.

Mr Gwanya responded that some industries, such as the IT industry, were mainly white-owned and the engagement of white owned firms was sometimes unavoidable.

Ms B Ntuli (ANC) noticed that the Minister, in the Foreword on page 7 of the DLA’s annual report, had highlighted the clear mandate given by the ruling party to achieve land and agrarian reform, and rural development. She questioned whether this mandate was in action, citing the examples she had witnessed in Mpumalanga, where beneficiaries had been granted land for farming, but were not given adequate assistance. This had resulted from the situation where the Department had not had a clear action plan but instead was “fumbling” with money allocated for development, and the incapacity of officials to respond appropriately and timeously to the challenges presented once the land had been granted. She said that beneficiaries did not receive the millions of rands promised, and therefore this situation on the ground in fact highlighted the inaccuracy of statements in the Annual Report alluding to “impact” and “monitoring and evaluation”. She also mentioned Bushbuckridge in particular. She asked whether the Commission was engaging with provinces in this work, and whether the problems of staff incapacity had resulted in this state of affairs.

Mr Mphela acknowledged that there were indeed some problems, and he said that the Commission was trying more and more to work with provinces. There was research under way and information would be communicated to claimants.

Mr S Abram (ANC) prefaced his input by saying that government needed to learn from the history of the National Party, because they delivered to their people for 48 years, and never lost an election in all that time. He was concerned that the lack of capacity and number of vacant posts had contributed to failure of the DLA in some areas. He said he endorsed what his colleagues said today about this Annual Report.

Mr Abram then expressed his concern that the DLA was not properly prepared for the outcome of the Court case for claims that had not been settled.

Mr Abram asked for an update on the Greater Tenbosch claim in Mpumalanga, as well as the claim of the Grootboom family in the Eastern Cape.

Mr Mphela said that the Tenbosch claim presented a challenge and the Commission was engaged in various projects with different partners. There were competing claims, in that land owners were challenging the validity of claims. A Court date for that challenge had been set down for February this year, but had been postponed again to next year. There was a commitment to reach a solution before that date so that the case could be withdrawn. A written report was being submitted on a monthly basis in regard to this claim.

Mr Mphela said that the Grootboom claim was now being finalised. The valuation would be completed by end of November.

Mr Abram questioned why such the “astronomical” amount of R4.9 million had been paid for the investigation into the sustainability of the Land Redistribution for Agricultural Development (LRAD) project. He commented that this money could have been better utilised towards resuscitating some of the other projects. He made an appeal to the Director General to review how the DLA had spent their resources.

Mr Gwanya responded that policies and training were now in place, which would assist Regional Commissioners in analyzing complex projects.

Mr Abram referred to pages 55 and 56 of the Annual Report. He asked that when a valuation for land was given, that province where such land is situated should be identified on the same list.

Mr Abram asked for accuracy when denoting amounts in millions and billions, for example on page 211 of the Annual Report.

Mr Abram asked which government departments were responsible for holding up projects. Members, if they knew of this information, could lobby the relevant Minister to attend to the problem.

Mr Abram asked that in future the DLA should only purchase farms which were a “going concern” in order to reduce the burden that would otherwise be placed on the beneficiaries in trying to succeed at the business.

Mr Mphela said that the Commission was working hard on the recommendation, since this had indeed been one of the issues raised as a weakness. That was why the Proactive Land Acquisition Strategy (PLAS) was being reviewed. Every effort was being made to do this, as well as to properly manage farms.

Mr Abram asked about an asset register, since the Auditor General had pointed out that the DLA did not have a system in place to record births and deaths of livestock. He asked whether DLA officials were equipped to do this job. He was opposed to the appointment of a service provider and asked whether there was in-house capacity to carry out this task.

Mr Gwanya responded that it was found that even the current farm owners used a service provider. He pointed out that this was a specialised service and not simply a matter of counting the stock. DLA did not have in-house capacity to do this task.

Mr Abram said that in South Africa there were essentially three government departments working towards a common goal. He asked how they were working together and whether there was synergy between them.

This question did not appear to have been specifically answered.

Mr Abram asked what measures were in place to check whether beneficiaries had the necessary skills to make a farm successful. He urged DLA to consider the resources already on farms, such as farm managers, to transfer skills and empower new beneficiaries.

Mr Gwanya said that the DLA had developed a manual, but the success of any project also depended on the staff’s level of ability and interaction with the manual. A workshop would be planned to improve and evaluate projects that were not working.

Mr Abram asked for an update on the progress with the distribution of 5 million hectares over two years.

Mr Gwanya said that a written response would be given to this question.

Mr Abram asked that the Members of this Committee should be informed about the issues of foreigners owning land as soon as there was any finality on this issue.

Mr Gwanya noted that a written response would be given to this question.

Mr Abram said that the references in the previous apartheid regime to categories such as Griqua, Coloured and so forth were not conducive to nation building. He suggested that instead a simpler coded system be used, which would denote whether a person was or was not deemed to be historically disadvantaged.

Mr Gwanya said that the DLA did not discuss issues with reference to race. However, this was raised in the media under this guise. This matter had been discussed with the Director General of the Research body, and it was specifically requested that the information, for their purposes, must be denoted in these categories.

Mr A Nel (DA) asked whether DLA could not budget over a longer period and in that way have better success in acquiring the funds from Treasury.

Although an answer was given to this question, it was inaudible.

Mr Nel asked,  with regard to the time lapse between negotiations over the asking price and the selling price, whether claimants had legal representatives to assist them.

Mr Mphela noted that legal services were being provided to restitution beneficiaries.

The Chairperson asked what the turnaround time was for negotiations, saying that the value of land could fluctuate in the meantime.

Mr Gwanya noted that the DLA was considering using scenario planning.

The Chairperson asked for a progress report in respect of the Bushbuckridge claim.

A report would be submitted.

The Chairperson said that he would like to see the issues around valuable and arable agricultural land being permitted to be used for golf estates being addressed.

Mr Gwanya reported that this was an environmental aspect, and would have to be answered in a written report, which would be sent to the Committee.

The Commissioner said that some of the questions from Members would still require a written response.

The meeting was adjourned.

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