ATC150505: Report of the Portfolio Committee on Rural Development and Land Reform on Budget Vote 39: Rural Development and Land Reform, dated 29 April 2015
Rural Development and Land Reform
Report of the Portfolio Committee on Rural Development and Land Reform on Budget Vote 39: Rural Development and Land Reform, dated 29 April 2015.
The Portfolio Committee on Rural Development and Land Reform, having considered the Strategic Plans (2015 – 2020) together with budget allocations and Annual Performance Plans (2015/16) of the Department of Rural Development and Land Reform, the Commission on Restitution of Land Rights and the Ingonyama Trust Board, reports as follows:
1. Introduction
This report presents an account of work done by the Portfolio Committee on Rural Development and Land Reform, hereinafter referred to as the Committee, during consideration of the strategic plans and budget allocations of the Department of Rural Development and Land Reform (the Department), the Commission on Restitution of Land Rights (the Commission), and the Ingonyama Trust Board (ITB). Analysis draws on a range of sources such as the 2014 and 2015 State of the Nation Address (SONA) by the President, the National Development Plan (NDP), the New Growth Path (NGP) the Estimates of National Expenditures (ENE) by the National Treasury, the 2015 Budget Speech by the Minister of Finance, and previous Budget Review Recommendations Reports (BRRR) of the Committee. This approach enabled the Committee to assess the extent to which the medium-term plans of the Department and entities addressed key challenges expressively highlighted through contextual scan of the environment within which they operated.
The Committee’s process of consideration of strategic plans and budgets as introduced above involved various briefing sessions. On 18 March 2015, the Department and the ITB presented their strategic plans and medium-term allocation of resources to various programmes. Particular focus on the 2015/16 financial year, highlighting how priorities were funded and what strategies would be used to achieve them. Further, on 16 April 2015 the Commission briefed the Committee about its plans with regard to restitution and how it allocated the resources to ensure that land claims were processed timely and appropriately. On 29 April 2015, the Committee sat for consideration and adoption of the budget vote report. Having participated and supported the process, the Democratic Alliance abstained from expressing its support for the adoption of the report.
The Minister of Rural Development and Land Reform, Mr G Nkwinti; Deputy Minister, Ms Mashego-Dlamini and Deputy Minister Mr M Skwatsha led the delegation comprising senior management of the Department. The ITB also participated during briefing sessions. During deliberations, the Committee paid critical attention to an extent to which the plans and strategies of the Department responded to government MTSF priorities and the SONA. It further appraised the plans against relevant priorities set out in the National Development Plan (NDP); for example, development and support of the smallholder agricultural sector, job creation, and rural industrial development.
Following this introduction, this report presents an overview of the strategic plans and budgets of the Department and its entities as introduced in the preceding paragraphs. It further documents a summary of the key conclusions drawn from deliberations and observations. To conclude, the report proposes specific recommendations per programme for consideration by the National Assembly.
2. The Department of Rural Development and Land Reform
The mandate of the Department, as articulated in the Strategic Plan 2015-2020 of the Department is to create and maintain an equitable and sustainable land dispensation; and acting as a coordinator and catalyst in rural development to ensure sustainable rural livelihoods, descent work and continued social and economic advancement of all South Africans. Its vision is to ensure attainment “vibrant, equitable and sustainable rural communities”, and its mission is to initiate, facilitate, coordinate, catalyse and implement an integrated rural development program. The vision and mission of the Department is underpinned by agrarian transformation as a strategy. Agrarian transformation is understood to mean “a rapid and fundamental change in the relations (systems and patterns of ownership and control) of land, livestock, cropping and community”.
- Strategic context and the key priorities for the 2015/16 financial year.
The Strategic Plan (2015-2020) proposes concrete plans and steps to address marginalisation of the poor, especially those living in the rural areas. Such marginalisation results from the legacy of apartheid’s spatial design which excluded blacks from the mainstream of the economy, unequal land ownership patterns, underutilisation and unsustainable use of natural resources, weak coordination of planning and implementation of rural development programmes, and inability of rural areas to attract sustainable enterprises and industries. Agrarian Transformation System, eloquently espoused in the Green Paper on Land Reform (2011) comprehensively integrates land reform and rural development. Such a system is aimed at ensuring transformation of rural economy in line with Chapter 6 of the National Development Plan titled “An Integrated and Inclusive Rural Economy”. It is aimed to attain integrated rural areas where residents will be economically active, have food security, access to basic services, health-care and quality education. It further acknowledges the potential to create 300 000 jobs in different farming levels.
The Agrarian Transformation System, as a strategy for transformation of rural economy, involves the following development measurable:
- Phase 1: Meeting basic human needs
- Phase 2: Rural enterprise development
- Phase 3: Agro-village industries, sustained by credit facilities and value-chain markets
- Phase 4: Improved land tenure
The Medium-Term Strategic Framework (MTSF) of government sets out the following priorities: increase the percentage of productive land owned by previously disadvantaged individuals from 11.5 per cent in 2013 to 20 per cent by 2019 (or 16.2 million hectares); reduce the percentage of households who are vulnerable to hunger from 11.4 per cent in 2013 to less than 9.5 per cent; reduce the percentage of the population living below the lower bound poverty line (R443 in 2011 prices) from 32.3 per cent to below 22 per cent; and reduce rural unemployment from the current 49 per cent to less than 40 per cent.
In view of the MTSF priorities, the Department identified seven MTSF priority areas that are linked to the NDP policy imperatives, namely:
- Improved land administration and spatial planning for integrated development with a focus on rural areas;
- Up-scaled rural development as a result of coordinated and integrated planning, resource allocation and implementation by all stakeholders;
- Sustainable land reform; and improved food security;
- Smallholder farmer development and support for agrarian transformation;
- Increased access to quality basic infrastructure and services, particularly in education, healthcare and public transport in rural areas; and
- Growth of sustainable rural enterprises and industries characterised by strong rural-urban linkages, increased investment in agro-processing, trade development and access to markets and financial services resulting in rural job creation.
Table 1: Strategic outcome oriented goals
|
Strategic Goal |
Strategic Goal Statement |
|
|
Source: adapted from the Strategic Plan of the DRDLR (2015-2020)
Whilst Table 1 above illustrates the strategic goals; Table 2 below illustrates strategic objectives according to the five main programmes. The Committee observed that the strategic objectives of the Department largely remained unchanged. However, it noted that the 2015-20 Strategic Plan has omitted tenure reform which was introduced in 2014/15 strategic plan. The Committee could not find particular objectives to hold the Department accountable in relation to fostering tenure security on commercial farms in terms of the Extension of Security of Tenure Act and the Labour Tenants (Land Reform) Act. Further, the current strategic plan provided limited avenues for reporting on tenure reform in communal land areas (enforcement of the Interim Protection of Informal Land Rights Act) as observed in the previous Budget Vote reports of the Committee. Nonetheless, the Committee welcomed plans to finalise tenure rights policies and legislation for both communal land and commercial farming areas.
Table 2: Strategic objectives of the Department of Rural Development and Land Reform
|
Programme |
Strategic Objective |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Source: adapted from the Strategic Plan DRDLR (2015-2020)
Appraisal of the strategic objectives, illustrated in Table 2 above, reveals that the plans were aligned to the NDP policy imperatives and relevant MTSF priorities; for example, improved spatial planning and integrated and comprehensive land administration, support to rural communities to produce their own food and support to smallholder farmers and job creation.
The Committee expressed its support for the strategic objectives, but it also noted that programme implementation in line with the mentioned strategic priorities and objectives would require improved coordination between land reform, land use, provision of communal tenure security, increased financial and technical support to farmers, and the provision of infrastructure in rural areas. It further welcomed the Ministers assurance that implementation of the Agrarian Transformation System dictated coordination and cooperation with other departments, mainly the Department of Agriculture, Forestry and Fisheries (DAFF). The Minister further stated that one of the critical interventions which would dictate cooperation was Agri-Park Master Plan for which R2 billion had been set aside. The focus of government would be to use this initiative to create and stimulate rural markets in the 27 priority rural districts. The Committee also observed that expansion of land ownership base for smallholders was high in priority for government and the Department in particular. Against the backdrop of dominance of large-scale commercial farms with strategic partnerships and mentorship programmes as a popular method of post-settlement support, the Committee would further focus on investigating how land redistribution, including Proactive Land Acquisition Strategy, would be used to expand land ownership base for smallholders. This, and other matters, would be key interventions to monitor and engage members of the public, project beneficiaries and stakeholders.
2.2 Priority legislation and policies to be developed in the medium-term
Ongoing policy development work resulting from public consultations pursuant to the publication of the Green Paper on Land Reform in 2011 led to development and amendment of a number of pieces of legislation. For the 2015/16 financial year, the Department has planned to process the following pieces of legislation:
2.2.1 Extension of Security of Tenure Amendment Bill: This Bill proposes amendments aimed at finding lasting solutions to tenure insecurities in commercial farming areas by combining land redistribution measures within effective legal protection and dispute mechanisms. The deadline for submission of this legislation in Parliament is June 2015.
2.2.2 Regulation of Land Holding Bill, 2015: This Bill seeks to provide for regulation of communal land, disclosure by landowners of their nationality, race and gender; the circumstances under which foreign persons may own and/or have access to land; the establishment and maintenance of a register of land ownership; the submission of information on public land; the establishment and composition of the Land Commission; and the resolution of disputes over situations in which two or more title deeds have been issued in respect of the same parcel of land. The Department has planned to table the legislation in Parliament by August 2015.
2.2.3 Communal Property Association Amendment Bill, 2015: This Bill seeks to amend the Communal Property Associations Act (1996) so as to redefine the kind of communities and persons to whom the provisions of the Act apply. It is further intended to clearly define the nature and sub- stance of the report on communal property associations that has to be tabled in Parliament. The Department has planned to table the legislation in Parliament by August 2015.
2.2.4 Electronic Deeds Registration Bill, 2015: It seeks to provide for an electronic deeds registration system. The Department has planned to table the legislation in Parliament by August 2015.
2.2.5 Communal Land Bill, 2015: The Bill provide for the regulation of communal land; legal security of tenure by transferring communal land, including KZN Ingonyama land, to communities and members of communities; the administration of communal land by communities; communal land administration committees and households forums; land rights enquiries; establishment of the Communal Land Board; and amendment and repeal of certain laws. The Department has planned to table the legislation in Parliament by September 2015.
The Committee urged the Department to adhere to the timeframes for submission of legislation to Parliament.
Table 3: Planned Policies over the MTEF period
|
2015/16 |
2016/17 |
2017/18 |
|
Policy on Rural Enterprises and Industry Development |
Exceptions on the June 1913 cut-off date of the Restitution of Land Rights
|
Rural Settlements Operations Policy |
|
Policy on Strengthening of Relative Rights for People Working the land |
National Land Tenure Policy: Responses to historically racial based social and economic disparate space
|
Policy on Rural Development Agency |
|
Policy on a Rural Development Investment and Finance Facility |
Policy on Access to Historical Land Marks and Heritage Sites on Private Land |
|
|
Electronic Deeds Registration Policy
|
|
|
|
Policy reviews: RADP, PLAS, Farm Share Equity Schemes |
|
|
Having considered the number of pieces of legislation to be processed and tabled in Parliament, the Committee welcomed reduction of the number of pieces of legislation to be processes when compared to previous years. This allowed the Department to focus on quality legislation rather than setting high targets which it failed to achieve. It further welcomed significant work being done to align policies to implementation of a programme for radical socio-economic transformation of the South African society as shown in Table 3 above. The Committee welcomed that these policies attempted to translate pronouncement of key policy imperatives made during the SONAs into programmes; for example, in 2015/16 it would develop the policy on Strengthening the Relative Rights for people working the land, in 2016/17 it would finalise the policy on exceptions to the June 1913 cut-off date of the Restitution of Land Rights Act as well as the policy on access to historical land marks on privately owned land and heritage sites. It would further review a range of policies so that they are aligned to the NDP and the National Growth Path (NGP); for example, comprehensive support to smallholder farmers by speeding up land reform and providing support to communities.
2.3. Overview of the 2015/16 Budget and MTEF estimates
As illustrated in Table 4 below, the Department has been allocated R9.379 billion for 2015/16 which accounts for 1.38 per cent of the total appropriation for government departments. When compared to the 2014/15 allocation, the 2015/16 allocation has declined by 1.48 per cent. Over the medium term, this allocation has also been reduced, that is R188 million in 2015/16 increasing to R737 million over the medium term. Such can be linked to a reduction of R195 million in the allocation for vacancy rate. As illustrated in Table 4 below, the budget allocation of R9.379 billion to the Department equates to a minimal increase of 0.3 per cent in nominal terms or yet in real terms it is a decrease of 4.33 per cent when compared to the revised allocation of R 9 355 billion in 2014/15. A nominal decrease in allocation for the programmes of Administration and Restitution accounts for this decrease.
Table 4: Programme Appropriations for the MTEF period (focus on 2014/15 to 2015/16)
|
Programme
R million |
Budget |
Nominal Rand Change |
Real Rand Change |
Nominal % change |
Real % change |
|||
|
2014/15 |
2015/16 |
2016/17 |
2017/18 |
2014/15-2015/16 |
2014/15-2015/16 |
|||
|
Administration |
1 314.9 |
1 264.3 |
1 342 504 |
1 414 485 |
- 50.6 |
- 108.5 |
-3.85 |
-8.25 |
|
Geo-spatial & Cadastral Services |
779.7 |
799.9 |
806 235 |
849 867 |
20.2 |
- 16.4 |
2.59 |
-2.11 |
|
Rural Development |
1 911.6 |
1 975.7 |
2 187 472 |
2 236 862 |
64.1 |
- 26.4 |
3.35 |
-1.38 |
|
Restitution |
2 680.7 |
2 602.7 |
3 181 357 |
3 340 957 |
- 78.0 |
- 197.2 |
-2.91 |
-7.36 |
|
Land Reform |
2 668.4 |
2 737.1 |
2 874 440 |
3 019 527 |
68.7 |
- 56.7 |
2.57 |
-2.12 |
|
TOTAL |
9 355.3 |
9 379.7 |
10 392 008 |
10 886 89 |
24.4 |
- 405.2 |
0.3 |
-4.33 |
Source: Based on National Treasury (2015) Estimates of National Expenditure, Vote 39
Overall analysis of this budget shows a real terms decrease across the board; that is, when inflation rate is factored in. However, closer scrutiny of the budget also shows additional allocations for implementation of e-cadastre and Spatial Planning and Land Use Management Act which is aimed at the improvement of land administration and spatial planning for integrated development; as well as establishment of the Office of the Valuer-General and the settlement of restitution claims. The Committee welcomed this budget mainly on the basis that it takes into cognisance the priorities of government as well as policy imperatives outlined in the National Development Plan.
2.3.1 Overview of budget allocation according to the programmes
The following sub-sections presents the analysis of budget and resource allocation, performance and expenditure trends. It presents all programmes except Programme 4 (Restitution), which is presented in the next section as part of the Commission on Restitution of Land Rights.
- Programme 1 (Administration)
This programme provides leadership, management and support services to the Department as a whole. It consist of the following sub-programmes: Ministry, Management, Internal Audit, Corporate Services, Financial Services, Provincial Coordination, and Office Accommodation. As illustrated in Table 4, the budget allocation of R1.264 billion represented a decrease in real terms by 8.25 percent when compared to an allocation of R1.341 billion in 2014/15. Except for the Provincial Coordination, all sub-programmes’ allocations decreased as well. However, the estimates of expenditure over the medium term show that allocations are expected to increase at an annual nominal growth rate of 1.8 per cent but in real terms it would decrease at an average rate of 3.4 per cent.
The Committee noted that the Department was, in some respect, constrained by lack of capacity to implement certain programmes. For example, increased demands due to the reopening of the lodgement of land claims, implementation of the Recapitalisation and Development Programme, the Spatial Planning and Land Use Management. In view of this, it expressed concerns with regards to the R195m decrease allocation for reduction of vacancy rate in 2015/16 which increases to R782 million over the MTEF period. Based on the previous BRRR of the Committee and the 2013/14 Annual Report, the Department was unable to meet the public sector acceptable 10 per cent vacancy rate, which impacted negatively on its capacity to achieve some of its annual targets. In this regard, the Committee welcomed the plans to mitigate some of the risks identified; namely, implementation of the vacancy management plan. In addition, other risk management plans include increased provincial coordination to achieve good corporate governance and service excellence; implementation of the fraud prevention strategy.
- Programme 2 (Geospatial and Cadastral Services)
This programme provides geospatial information, cadastral surveys, deeds registration, spatial planning information and other technical services in support of sustainable land development. The work is carried out under five sub-programmes; namely, National Geomatics Management Services, Spatial Planning and Land Use Management, Registration of Deeds Trading Account, South African Council of Planners, and e-Cadastre. The budget allocation for this programme increased from R779.7 million in 2014/15 to R799.9 million in 2015/16. Whilst this represented a 2.6 per cent increase in nominal terms, in real terms it amounts to a decrease of 2.1 per cent. Spatial Planning and Land Use Management and National Geomatics Management Service Sub-programmes make up 84.7 per cent of the total expenditure of the Programme, which indicate that they are priority sub-programmes.
With regard to sub-programme allocation, the Spatial Planning and Land Use Management received a nominal increase of 10.53 per cent in 2015/16 compared to 2014/15 allocation. The Committee welcomed an additional allocation of R27 million towards implementation of SPLUMA. This will have significant impact on expenditure of goods and services which will slightly increase owing to surveys of state domestic facilities, facilitation and coordination of implementation of the SPLUMA by municipalities. This will result in increase in expenditure over the medium term as more town and regional planners, professional surveyors and technicians would be recruited.
The Committee expressed concerns regarding the delays in implementation of the e-Cadastre project which was aimed at improvement of efficiency and accuracy of South Africa’s land information management. It further noted that e-Cadastre, as a sub-programme, has not been given any budget allocation, thus raising doubts about its priority status and whether the programme was going to make any progress in relation to implementation of all the mitigation strategies outlined. However, the Committee welcomed that much of the work will be carried out by the Deeds and Surveyor-General’s Offices. The Committee further welcomed prioritisation of finalisation of the land register to enhance effective land planning and administration.
- Programme 3 (Rural Development)
The purpose of this programme is to initiate, facilitate and coordinate and catalyse the implementation of the Comprehensive Rural Development Programme that leads to sustainable and vibrant rural communities. It operates through three sub-programmes; namely, rural infrastructure development (RID), Rural Enterprise and Industrial Development (REID), and National Rural Youth Service Corps (NARYSEC). Among the top priorities, the Department has planned to support rural communities by supporting development of 12000 rural livelihoods by 2020; in addition, development of 1300 sustainable rural enterprises and industries, creation of 17157 job opportunities through CRDP and provision of 23700 training opportunities to youth by 2020.
For the 2015/16 financial year, the total appropriated funds for this programme is R1.975, representing a 6.3 per cent decrease in real terms when compared to allocation for 2014/15. A decrease in allocation for NARYSEC from just over R628m in 2014/15 to R331m in 2015/16 accounts to most of the decrease in this programme. Concomitantly, the target for the number of young people to be trained has also been reduced by 50 percent from 5 000 in 2014/15 to 2 500 in 2015/16. Over the medium-term, however, the expenditure for rural development is expected to increase at an average growth rate of 4 per cent in nominal terms.
The Rural Infrastructure Development (RID) and the Rural Enterprise and Industrial Development (REID) accounts for about 84 per cent of the total budget of rural development. This was considered to be a vital contribution because the sub-programmes are at the centre of provision of agricultural support to farmers, infrastructure development for basic service, and economic development in rural areas. Overall, they drive implementation of the rural livelihood strategy which involves coordination and facilitating infrastructure development projects. The Committee noted that the programme has planned to recruit more personnel to increase internal capacity to implement the CRDP.
Based on its experience from oversight activities (site visits and public hearings on RADP), the Committee expressed concerns over lack of integrated planning and coordination both within the Department, especially the RID, REID and Land Reform, and other government departments such as Department of Agriculture, Forestry and Fisheries (DAFF), Department of Water and Sanitation and Department of Cooperative Governance and Traditional Affairs (COGTA). This posed a risk to implementation of the programmes and success of CRDP.
- Programme 5 (Land Reform)
This purpose of this programme is to initiate sustainable land reform programmes in South Africa. It operates through four sub-programmes; namely, land redistribution and development national office, land redistribution and development provincial offices, land redistribution and development grants, and land tenure and administration.
The budget allocation for this programme increased by 2.6 per cent in nominal terms from an adjusted allocation of R2.67 billion in 2014/15 to R2.74 billion in 2015/16. However, in real terms, this amounts to a 2.12 decrease. It is anticipated that the budget would increase at a nominal annual rate of 4.2 per cent over the medium term. This increase of 38.82 per cent in real terms in the budget allocation for Land Reform sub-programme in 2015/16 accounts for such increase over the medium term. Because the spending focus in this programme will be on provision of comprehensive development support to smallholder farmers, land reform beneficiaries, spending on the RADP is likely to increase due to plans to recapitalise 1 354 farms over the MTEF period.
The Committee welcomed reprioritisation of funds, about R36 million, for the establishment of the Office of the Valuer-General. It is anticipated that the Office would improve the efficiency of acquiring land by ensuring that land is acquired at its proper value rather than exorbitant values which are above the market price.
In addition, the programme has put in place measures to establish the District Land Committees (about 27 in 2015/16) in line with the NDP, about 37000 ha planned to be redistributed to farm dwellers, as well as allocate 18500 ha to smallholders.
2.3.2 Public Entities and other agencies
With the exception of the ITB and the Commission, there are two entities reporting under the Department; namely, the Agricultural Landholding Account (ALHA) and the Registration of Deeds Trading Account.
- Agricultural Land Holding Account
The purpose of ALHA is to acquire, hold and lease land to beneficiaries under the Proactive Land Acquisition Strategy (PLAS). Over the medium-term, ALHA is expected to acquire 1.1 million hectares of strategically located land for redistribution and development and recapitalisation of 1 051 farms under the Recap programme at the cost of R4.7 billion. Its expenditure on acquisition of productive land is expected to slightly increase from adjusted allocation of R280.3 million in 2014/15 to R283.9 million in 2015/16. The transfers from the Department to the entity has significantly decreased from adjusted allocation of R1.718 billion in 2014/15 to R1.542 billion in 2015/16, a decrease of 14.39 per cent in real terms.
This expenditure trend projected suggests that lesser amount would be available for acquisition of land in 2015/16 as compared to 2014/15. The Committee noted with concern that two consecutive years, budget allocation for ALHA had decreased. Considering that the PLAS was the only vehicle for land acquisition, there was limited room, for manoeuvre to upscale redistribution.
- Registration of Deeds Trading Account
This account contributes to the effective land planning, administration and property registration which comprises of national priorities to improve land administration and spatial planning. Its purpose is to register rights in land and maintain public registers of land. Over the medium term, the priority will be the implementation of e-Cadastre, improvement of the process to register as well as the turnaround times.
The total allocation to this account which include its revenue is expected to increase from R727 million in 2014/15 to R839.2 million in 2015/16. Such an increase factors in an increase in property registration as market stabilise and more property is acquired in the medium term.
3. The Commission on Restitution of Land Rights
The Commission on Restitution of Land Rights (CRLR) was established in terms of the Restitution of Land Rights Act, 1994 (Act No. 22 of 1994) to provide restoration of land rights and equitable redress in line with the provisions of section 25 (7) of the Constitution, 1996 (Act 108 of 1996). By 31st December 1998, a total of 79 687 claims had been lodged and at the end of March 2014, approximately 77 610 (97 per cent) of them had been settled at a cost of R29.3 billion, including restoration of 3.07 million hectares and awards of financial compensation of R8 billion. By end of December 2014, about 8 204 land claims were outstanding.
The Committee observed the following developments which has a bearing on the functioning of the Commission:
- By the end of March 2014, the Commission had a commitment register of R4.8 billion. It further noted that 72 per cent comprised grant payments for development support.
- Amendment of the Restitution of Land Rights Amendment Act in 2014, resulted in the reopening of the lodgement of land claims with effect from 30 June 2014. By 17th April 2015, over 50 000 land claims had been received.
- The national evaluation of the Restitution Programme by the DPME recommended that the autonomy of the Commission should be upheld, hence the restructuring of the Commission.
3.1 Strategic priorities for the Commission on Restitution of Land Rights in 2015/16
In line with MTSF, Outcomes Frameworks of government, and the NDP, the Commission identified three strategic goals as follows:
- Land rights restored in order to support land reform and agrarian transformation by 2020.
- Lodgement of restitution land claims re-opened for people who did not meet the 1998 deadline.
- Organisational change management.
The Commission set out the following annual targets for the MTEF:
- To settle 1 748 claims over the medium term, of which 463 claims will be settled in 2015/16.
- To finalise 1 133 claims over the medium term, of which 373 will be finalised in 2015/16.
- To finalised 229 phased projects over the medium term, of which 62 will be finalised in 2015/16.
- To have 7 288 of claims lodged by 1998 researched over the medium term, of which 2 660 will be researched in 2015/16.
- Two 4x4 mobile offices operational in 2015/16 and conversion of 9 communication vehicles into mini-lodgement units in 2017/18.
The Committee welcomed efforts of the Commission to align its strategic goals with the national priorities as outlined in the NDP and government priorities for MTSF for 2014-2019. Such priorities are interventions towards sustainable land reform and agrarian transformation; in particular, facilitating transfer of land to previously disadvantaged people; the re-opening of the lodgement of land claims; and faster pace of settlement of land claims.
3.2 Overview of estimates of expenditure for restitution (the Commission)
The budget for the Restitution Programme shown in Table 5 below has dropped from R2 680 billion in 2014/15 to R2 607 billion in 2015/16, representing a decrease 2.91 in nominal terms or 7.36 per cent in real terms. The 67.78 per cent decrease in the budget allocation for Restitution National Office accounts for much of the decline.
Table 5: Appropriations from 2014/15 to 2015/16
|
Sub-programme
R million |
Budget |
Nominal Rand Change |
Real Rand Change |
Nominal Percent change |
Real Percent change |
|
|
2014/15 |
2015/16 |
|||||
|
Restitution National Office |
175 647.0 |
59 303.0 |
- 116 344.0 |
- 119 060.2 |
-66.24% |
-67.78% |
|
Restitution Regional Offices |
453 874.0 |
427 366.0 |
- 26 508.0 |
- 46 082.0 |
-5.84% |
-10.15% |
|
Restitution Grants |
2 051 221.0 |
2 116 000.0 |
64 779.0 |
- 32 137.0 |
3.16% |
-1.57% |
|
TOTAL |
2 680 742.0 |
2 602 669.0 |
- 78 073.0 |
- 197 279.2 |
-2.9 % |
-7.36% |
Source: National Treasury (2015).
The Committee expressed concerns with the decline in the sub-programme of Restitution National Office, this was particularly due to the plans to move toward an autonomous Commission. In addition, the other sub-programmes as shown in Table 5 had also received less funds as compared to 2014/15. However, the reopening of land claims is increasing the number of land claims to be settled. Therefore, the budget for restitution, to date, has not factored in an increase in the number of new land claims in excess of 50 000. The Committee agreed to enhance its oversight on the implementation of the restructuring of the Commission as well as settlement and finalisation of the outstanding claims. It is anticipated that through the additional allocation of R461 million in 2015/16 and R1.1 billion over the medium-term, some of the shortcomings addressed here would be resolved. For example, increase of capacity of the Commission as an autonomous entity in areas of administration, research and settlement//finalisation of land claims.
The Committee further noted that according to the Department of Planning Monitoring and Evaluation (DPME) study, in terms of scenario 1 of how the Commission should finalise land claims, it estimated that about 8 471 outstanding land claims by 2012/13 would cost R16.9 billion to the state. Further, it would take just over 7 years to finalise those land claims. However, the concern is that the pace at which claims are settled annually, and the related costs, makes it difficult to increase the pace. Increase in annual targets means there should be substantial additional operational funding as many of the remaining claims are complex.
4. The Ingonyama Trust Board
The ITB is a schedule 3A Public Entity and reports to the Minister of Rural Development and Land Reform. As the accounting authority, the ITB derive its mandate from the founding legislation and the Public Finance Management Act (Act 1 of 1999). The Ingonyama Trust was established in terms of the Kwazulu-Natal Ingonyama Trust Act No 3 of 1994, amended by the National Act 9 of 1997 which provided for the establishment of the Ingonyama Trust Board (ITB). The Ingonyama Trust functions as a landowner-in-law of the Ingonyama Trust Land (previously owned by the KwaZulu Government). To date, such land was estimated to be 2, 844,903 hectares under some 1600 individual titles in all of the 11 Districts of Kwazulu-Natal and eThekwini Metro. The ITB ‘s vision is to become a leader in sustainable communal land management and its mission is to contribute to the improvement of the quality of life of the members of traditional communities living on Ingonyama Trust Land by ensuring that land management is to their benefit and in accordance with the laws of the land. The ITB has innovatively set out to develop best practices “to ensure that by 2025 all persons occupying its land shall have formal tenure in the form of a lease on surveyed land”.
4.1 Strategic context and priorities
The following subsections provides an analysis of the plans vis-à-vis the founding legislation, available resources, and the capacity of the ITB to perform the functions as planned. Increasingly the recurring question about the mandate and the role of the ITB vis-à-vis its programmes to date is becoming more relevant than ever. Introduction of programme 3 (Rural Development), which is discussed below, makes this even more urgent. The current policy proposals regarding land tenure indicates that South Africa will have a four tier land tenure system. Additionally, the Communal Land Tenure Policy, which is currently being debated in the DRDLR also makes proposals that would have significant implications for land administration within traditional communities, including communities on the Ingonyama Trust land.
4.2. Estimates of expenditure according programmes
A strategic shift for the 2015-2020 period was an introduction of programmatic approach. It introduced four programmes; namely, administration, Land management, Rural Development, and Traditional Council’s Support.
Overall allocation of the ITB for the 2015/16 is about R87, 6 million which is about 28.46 per cent increase in nominal terms when compared to the appropriated fund of R62.7 million in 2014/15. However, the budget decreases over the MTEF period. Overall analysis of the budget of the ITB shows that administration accounts for 67 per cent of the total budget whereas land administration, rural development and support to traditional councils accounts for 3 per cent, 10 per cent and 19 per cent respectively. Whilst all programmes have received nominal increases, support to traditional councils has received less allocation from R22.6 million in 2014 to R16.7 million in 2015/16 or a 25 per cent decline in allocation.
Table 6: ITB Appropriations for 2015/16
|
Programme |
Actual 2013/14 |
Revised Budget 2014/15 |
Proposed Budget |
|||
|
2015/16 |
2016/17 |
2017/18 |
2018/19 |
|||
|
Administration |
85,824,820.00 |
37,470,936.00 |
59,089,914.61 |
43,521,361.75 |
45,880,630.75 |
48,174,177.49 |
|
|
|
|
|
|
|
|
|
Land Management |
450,357.00 |
2,583,896.00 |
2,785,900.05 |
2,925,195.00 |
3,071,454.81 |
3,225,027.55 |
|
Tenure upgrade & formalisation |
- |
1,050,000.00 |
1,102,500.00 |
1,157,625.00 |
1,215,506.25 |
1,276,281.56 |
|
Land identification for special project |
- |
562,146.00 |
562,146.00 |
590,253.30 |
619,765.97 |
650,754.26 |
|
Land tenure information system |
296,111.00 |
200,000.00 |
310,916.55 |
326,462.38 |
342,785.50 |
359,924.77 |
|
Workshops on cooperation agreements.
|
154,246.00 |
717,750.00 |
810,337.50 |
850,854.38 |
893,397.09 |
938,066.95 |
|
Rural Development |
- |
- |
9,000,000.00 |
9,270,000.00 |
9,455,400.00 |
9,644,508.00 |
|
Food security programme
|
- |
- |
9,000,000.00 |
9,270,000.00 |
9,455,400.00 |
9,644,508.00 |
|
Traditional Councils Support |
28,834,923.00 |
22,647,168.00 |
16,766,609.98 |
17,818,301.28 |
19,011,022.05 |
20,245,235.15 |
|
Provision for Traditional councils
|
28,834,923.00 |
22,647,168.00 |
16,766,609.98 |
17,818,301.28 |
19,011,022.05 |
20,245,235.15 |
|
TOTAL |
115,110,100.00 |
62,702,000.00 |
87,642,424.64 |
73,534,858.09 |
77,418,507.61 |
81,288,948.19 |
(a) Administration
This programme provides strategic leadership of the organisation, corporate services, logistical services and financial management to the Trust. It comprises strategic units such as legal services, communication, financial services and general administration as well as Human Resources. Administration has been allocated approximately R59 million in 2015/16, about 58% more than the R37.4 million allocated in 2014/15. This allocation targeted to ensure efficient management of the Board, skills development to employees and to improve customer relations. Some of the key priorities under this programme are: To develop five policies: Revenue policy, Revise disbursement of funds policy, Review of supply chain management policy, Review of asset management policy. Of strategic significance is the amendment of the Ingonyama Trust Act to provide for the rural development component of its programmes.
The Committee welcomed clear specification of policies to be introduced. It however expressed concerns over a number of outstanding issues that required urgent attention by the Minister. For example, consideration of election of the new Board since the existing Board has been in operation for a long time and its term of office was being renewed annually.
Majority of the employees of the ITB were contract workers. It was unclear to the Committee what steps were being taken to ensure that this was reversed. Of grave concern was the centralisation of the position of the Chief Executive Officer (CEO) and the Chief Financial Officer (CFO) in one person, even if this was a temporary measure. It called for urgent an appointment of the CEO.
(b) Land management
This programme seeks to ensure provisions of a secure tenure and establish a comprehensive land tenure information system. The Committee welcomed this initiative, in particular, it considered this as something that could provide lessons to the development of a national policy around land administration in the former homeland areas. For the 2015/16 financial year, close to R2.8 million has been budgeted for land management and the budget increases to R3.2 million over the MTEF period. Significant portion of this budget (R1.1 million) is allocated for tenure upgrade and settlement formalisation, focussing on approval of land tenure rights by the ITB, from about 1300 in 2015/16 to 1500 in 2019/20.
(c) Rural Development
This is a new programme that seeks to coordinate, initiate, and facilitate the implementation of Rural Development to strengthen security and agricultural production. The Committee noted that ITB was still working on an amendment of the Act in order to substantially change the role of the Board, partly to align its role with emphasis on Rural Development. Therefore, it expressed concerns regarding implementation of a programme prior before the amendment of the Act was passed by Parliament. It was yet to be seen how this programme complement the work done by other government departments, including DRDLR in respect of the CRDP. In addition, the implications of this function on the funding of the new posts and general implications on the organogram of the ITB was yet to be clarified.
(d) Traditional councils
The focus of this programme is to provide training to Traditional Councils and educational awards to community members. For the 2015/16 financial year, R16.7 million has been allocated for this programme to cater for training of 45 Traditional Councils and granting 100 educational awards. In terms of the Board’s Disbursement Policy, 10% of the revenue should be allocated for own operations whereas 90% should be allocated to communities, particularly those that are the source of the revenue. The procedure is that communities develop (bankable) business plans. The Committee requested breakdown of the budget in terms of the two focus areas, training of Traditional Councils and Educational Awards for its oversight purposes.
5. Overview of key conclusions drawn from the deliberations on the Strategic Plan, the Annual Performance Plan of the Department, the Commission and the ITB
Having received the briefing and deliberated the findings and observations on budget allocations and Annual Performance Plans of the Department, the Commission and the ITB; the Committee drew the following conclusions:
5.1 The Department of Rural Development and Land Reform
Administration
5.1.1 The work initiated under the Green Paper on Land Reform, taken forward through consultative processes of the National Reference Groups, has resulted in development of a range of policies that are earmarked at fixing the impediments to land reform. The planned pieces of legislation to be tabled in Parliament seeks to address the challenges of tenure security on commercial farms and in the former homeland areas. The CPA amendment Bill also seeks to address some of the challenges that confront the CPAs in South Africa.
5.1.2 The Department, including the Commission, require increased capacity, as proposed in the Strategic Plan, especially in the Internal Audit as well as enhancement of internal controls and management systems which could result in attainment of an unqualified audit opinion by the Auditor-General. Further capacity is required to implement the following: reopening of the lodgement of land claims and research all outstanding land claims, and enhance implementation of the RADP as well as strengthening its Monitoring and Evaluation.
Geospatial and cadastral services
5.1.3 Focus on the implementation of the Spatial Planning and Land Use Management Act as well as partnerships between the Department and municipalities creates potential for reversal of the legacy of apartheid spatial planning and integrated sustainable growth and development. Allocation of additional R27 million towards implementation of SPLUMA could make a significant improvement in support of municipalities by surveying state domestic facilities as well as facilitation and coordination for implementation of SPLUMA. Lack of capacity within some of the municipalities to develop Land Use Schemes could hamper progress and achievement of targets.
5.1.4 Inability to implement e-Cadastre would continue to affect South Africa’s ability to improve its efficiency and accuracy of land information management. It is thus significant to, in the interim, finalise development of the land register as part of means to enhance effective land planning.
Rural Development:
5.1.6 Effective coordination and facilitation of government interventions could enable the Department to attain wider coverage of rural areas in terms of the CRDP initiatives that could lead to improved access to services and establishment of rural enterprises and industries such as cooperatives proposed in the strategic plans of the Department.
5.1.7 Lack of intra coordination of programmes within the Department, especially RID, REID and Restitution, affects the ability of the Department to integrate land reform within wider programme of rural development.
Land Reform
5.1.8 Prioritisation of acquisition of strategically located land matched with adequate recapitalisation and development support, both in terms of pre and post settlement stages of the project could assist to off-set some of the current challenges that has entangled land reform. The office of the valuer-general, once established, would address the challenge of ever-escalating costs of land acquisition by government and shorten turnaround times concluding purchases of land for land reform purposes.
5.1.9 Recapitalisation and development support for land reform farmers and rural communities is the most crucial complement of agrarian transformation, especially if it addresses the needs and aspirations of the intended beneficiaries. Poor monitoring of the programme to recapitalise and develop the farms, especially the use of private sector partners and mentors, has the potential to undermine the intentions of the programme. RADP is undermined by lack of streamlining of farmer support programmes offered by DAFF and DRDLR creating confusion among beneficiaries.
5.1.10 The District Land Committees, as set out by the NDP, could assist in area-based land reform that is driven by the needs and aspirations of local people and stakeholders.
5.2 Commission on Restitution of Land Rights
5.2.1 Setting up an autonomous Commission is an attempt to ensure compliance with the founding legislation. A meaningfully autonomous Commission would require additional post establishment and delegation powers.
5.2.2 Reopening of lodgement of land claims creates opportunities to broaden access to land by people who would otherwise not have been able to lodge claims because they missed the deadline for lodgement or were erroneously excluded; for example, the betterment claimants. Large number of claims lodged already in less than 12 months is in excess of 50 000, and with further communication and use of mobile lodgement sites the numbers could exponentially increase, thus having significant financial implications for capacity to research, negotiate and settle those claims.
5.2.3 The Commission has no control over the processes of the Land Claims Court in litigation of cases. Therefore, matters before the court can take longer to finalise for a range of reasons; amongst others is the number of available judges and the quality to research available amongst others. However, the fact that the Commission has started to work with academic institutions to address the challenge of poor capacity in research could assist to address some of the challenges.
5.3 The Ingonyama Trust Board
5.3.1 Introduction of the programme of rural development prior to amendment of the founding legislation poses a risk that the ITB could be formally implementing programmes that it is legally not permitted to. Process of consultation with other government departments and structures, most importantly municipalities is necessary to avoid duplication and competition.
5.3.2 The absence of a range of policies, especially policies on funding cultural activities, women’s independent access to land, and other relevant policies affected the manner in which the ITB performed some of its functions effectively.
5.3.3 The ITB has not resolved perennial question raised by the Auditor-General in relation to asset management. Inability to resolve this matter has implications toward achievement of clean audit.
6. Recommendations
In view of the observations and key conclusions discussed above, the Committee recommends that, within three months after adoption of this report by the National Assembly, the Minister of Rural Development and Land Reform should:
Administration
6.1 Submit a progress report detailing status quo with regard to the five pieces of legislation that are targeted for tabling in Parliament. Further, the report should indicate if the Department would be meeting the set timeframes, if not, revised timeframes should be proposed and be submitted to the Committee so that proper planning by the Committee could be done.
6.2 Ensure that the vacancy rate of the Department and the Commission was reduced by filling all strategic and senior management positions, the vacant Deputy Director-Generals and Chief Director’s positions in particular, in order to address the challenges of lack of capacity to perform on some of the critical programmes.
6.3 Consult widely with all relevant stakeholders together with farm workers, as intended active partners to the proposed enterprises to be established in terms of the proposed policy on ‘Strengthening Relative Rights for People Working the land’. Further, the Minister, having concluded consultations with farmers and stakeholders, should table a report, including outcomes of consultation process, in Parliament about key policy proposals for further deliberation.
6.4 Ensure implementation of the risk management strategies and plans so that all forms of exposure to risks are contained and submit progress report to Parliament.
Geospatial and cadastral Services
6.5 Submit a report about the targeted municipalities that the Department plans to assist in developing the Land Use Schemes in order to address the related legacy of apartheid spatial planning.
6.6 Submit a progress report on the investigation on the e-cadastre project.
Rural Development
6.7 Ensure effective improvement of coordination of planning and interventions, especially in areas where there is potential for duplication of services; for example Land Care programme of the Department of Agriculture, Forestry and Fisheries vis-à-vis Animal and Veld Management Programme of the DRDLR. In addition, mechanisms to foster coordination within the Department should be put in place, especially land reform, restitution and RID as well as REID. Further, to submit the report on progress made.
6.8 Conduct a review of the NARYSEC programme to assess if the programme has achieved the intended consequences in the last five years, challenges encounters, and implications for future implementation plans.
Restitution (Commission on Restitution of Land Rights)
6.9 Continuously engage National Treasury about increasing allocation of funding for restitution to clear the commitment register of settled land claims.
6.10 Ensure that the programme for mobile land claims lodgement centres are publicised, including circulation at local municipalities, constituency offices, traditional councils, and other public centres to ensure effective campaign for reopening of lodgement of land claims. Further, submit progress report on the performance of the mobile lodgement centres, including but not limited to, provinces and areas visited, number of land claims received per mobile lodgement centre, total cost of operation per mobile centre.
6.11 Develop guidelines and strategic framework for prioritisation of all land claims lodged prior to the cut-off date of 31 December 1998. Such framework should provide a time-framed and realistic plans, with estimated costs, for research, gazetting and settlement of such land claims.
6.12 Submit a report on all litigation matters before the Land Claims Court, detailing the dates of lodgement and referral to the Land Claims Court, the nature of dispute, the current status of each matter, and financial implications to the Commission.
6.13 Finalise the revised organogram of the Commission to ensure that the new structure aligns with the autonomy of the Commission. Further, submit quarterly reports on progress towards achieving full autonomy of the Commission.
Land reform and development support
6.14 Improve on monitoring and evaluation of the implementation of the Recapitalisation and Development Programme.
6.15 Develop models for assessment of the viability of the Recapitalisation and Development Programme farms which is based on, amongst others, economic viability and profitability of the farms.
6.16 Ensure coordination of with DAFF to ensure streamlining farmer support to land reform beneficiaries, including small-scale farmers. One such area of streamlining is extension support services.
6.17 Submit a performance plans on the Tenure Reform component of the land reform programme (mainly farm evictions and land rights management facility) with clear and realistic targets and performance indicators.
The Ingonyama Trust Board
6.18 Ensure that the ITB appoints the Chief Executive Officer within reasonable time to avoid having the CEO and CFO positions being centralised in one person.
6.19 Finalise policies to address gaps relating to funding of cultural activities, promotion of women’s independent access to land and other relevant policies that affect the manner in which the ITB performs its functions.
6.20 Facilitate, without delay, resolution of ongoing questions raised by the Auditor-General in relation to the value of the ITB’s land/property so that the ITB could move toward achievement of an unqualified clean audit. Further submit quarterly progress report on implementation of the remedial measures.
6.21 Conduct a comprehensive socio-economic impact assessment of the performance of the ITB and how the beneficiaries have materially and socio-economically benefited from the ITB programmes.
6.22 Submit a detailed plan on how the new programme of Rural Development would work and its impact on the structure and mandate of the ITB. Further, submit the proposed organogram that incorporates the programme of rural development.
6.23 Ensure that the ITB complies with the National Treasury Regulations and the Public Finance Management Act guidelines with regard to accounting on all its funds, irrespective of income generated by the ITB or the funds voted by Parliament.
6.24 Develop and submit clear performance indicators that shows how the ITB will contribute to improvement of the lives of the rural communities. Further, assist the ITB to conduct socio-economic impact assessment of its performance against the founding legislation and the programmes it implemented over the last five years.
6.25 Develop mechanisms and systems to improve oversight by the Department over the ITB, further link to the monitoring and evaluation of the Department. The Minister is requested to submit a report to the National Assembly about this matter within three months of adoption of this report by the house, as it is the case with the rest of the recommendations.
Report to be considered
Documents
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