ATC200605: Report of the Portfolio Committee on Agriculture, Land Reform and Rural Development on the 2020/21 Annual Performance Plan and the Budget of the Department of Agriculture, Land Reform and Rural Development and its Entities, Vote 29, Dated 29 May 2020.

Agriculture, Land Reform and Rural Development

REPORT OF THE PORTFOLIO COMMITTEE ON AGRICULTURE, LAND REFORM AND RURAL DEVELOPMENT ON THE 2020/21 ANNUAL PERFORMANCE PLAN AND THE BUDGET OF THE DEPARTMENT OF AGRICULTURE, LAND REFORM AND RURAL DEVELOPMENT AND ITS ENTITIES, VOTE 29, DATED 29 MAY 2020.

 

The Portfolio Committee on Agriculture, Land Reform and Rural Development (hereinafter referred to as the Portfolio Committee) examined the 2020/21 Vote 29: Agriculture, Land Reform and Rural Developmentand budget projections for the Medium Term Expenditure Framework (MTEF) period ending in2022/23 financial year. The process entailed scrutiny of the 2020/21Annual Performance Plans (APPs) and Budgets of the Department of Agriculture, Land Reform and Rural Development (hereinafter referred to as the Department), and therelevant National Public Entities listed in Table 1 of this report during briefings held on 05, 11 and 19 May 2020.

 

Having consideredBudget Vote 29, together with Strategic Plans and APPs of the Department and the relevant National Public Entities, the Portfolio Committee reports as follows:

 

1.       Introduction

 

This report accountsfor the process embarked upon by the Portfolio Committee on Agriculture, Land Reform and Rural Developmentto consider Vote 29: Agriculture, Land Reform and Rural Developmentas tabled by the Minister of Finance, and the Five-Year Strategic Plans and Annual Performance Plans of the Department of Agriculture, Land Reform and Rural Development (hereinafter referred to as the Department), and relevant public entities as listed in Table 1. Vote 29 is a reconfigured allocation that combines the Agriculture component of the former Vote 24: Agriculture, Forestry and Fisheries and Vote 39: Rural Development and Land Reform. TheCommittee process followed the tabling of Strategic Plans, APPs and budget allocations by the Department and its national public entities in Parliament as required in terms of the Public Finance Management Act (PFMA), 1999 (Act No. 1 of 1999). The APPs outline the annual plans in line with Strategic Plans and the allocated budget as per the Estimates of National Expenditure(ENE) tabled by the Minister of Finance. These planning documents were tabled on 13 March, 26 March and 02 April 2020; and presented at briefing sessions as shown in Table 1.

 

Table 1: Briefing Sessions by the Department and its Public Entities

Department and Public Entities under Vote 29	Date of briefing
Department of Agriculture, Land Reform and Rural Development	05 May 2020
Commission on Restitution of Land Rights	05 May 2020
KwaZulu-Natal Ingonyama Trust Board	05 May 2020
Office of the Valuer-General	11 May 2020
Agricultural Research Council	11 May 2020
Onderstepoort Biological Product	11 May 2020
National Agricultural Marketing Council	11 May 2020
Perishable Products Export Control Board	11 May 2020
Department of Agriculture Land Reform and Rural Development	19 May 2020

 

During the scrutiny of the Strategic Plans and the APPs, the Portfolio Committeeassessed whether the plans of the Department and Entities were aligned to the State-of-the-Nation Address(SONA) of February 2020, the National Development Plan (NDP) policy priorities and targets, the 2020-2024 Medium Term Strategic Framework (MTSF) and other key government policy priorities. It further examined resource allocationto determine if the available resources would enable the Department and Entities to deliver the targets they set for themselves and realisation of the expected outcomes of the interventions. The fact that Vote 29 was reconfigured to merge some of the functions of the former Department of Agriculture, Forestry and Fisheries (DAFF) and those of the Department of Rural Development and Land Reform (DRDLR), the Portfolio Committee further examined whether there was adequate capacity in the Department to implement the macro-structure of the merged Department and how the reconfiguration would contribute in addressing the weaknesses of the former DRDLR and DAFF, including weaknesses associated with the concurrent competency of agriculture and rural development. The Committee also took into account that Department was being expected to prioritise the implementation of recommendations of the Presidential Advisory Panel on Land Reform and Agriculture, therefore, was curious to see how the recommendations were factored into the plans of the Department. The outbreak of Covid-19 towards the end of the 2019/20financial year and the subsequent interventions by the Department, dictated that the Portfolio Committee should assesshow the Covid-19 outbreak, declared a national disaster, impacted the 2019/20 and 2020/21 budget allocations and plans in the APPs.

Following this introduction, the report proceeds as follows: Section 2 presents an overview of the national policy mandates, particularly the relevant NDP policy priorities, MTSF priorities and the SONA by the State President; Sections 3 and 4discusses the responses of the Portfolio Committee to the Strategic Plans and Annual Performances of the Department and Entities; Section 5 introduces responses of the Department to the Covid-19 national disaster and how budget allocations have been affected; Section 6 summarises the key conclusions of this report on the basis of the observations of the Committee in Sections 3, 4 and 5; and finally Section 7 proposes recommendations to the National Assembly.

 

2.       The National Policy Mandates

 

2.1     The National Development Plan: Vision 2030

 

The NDP’s overarching aim is to eliminate poverty and reduce inequality by 2030. The Plan recognises that South Africa needs an inclusive economy that is more dynamic and in which the fruits of growth are shared equitably amongst its citizens. Chapter 6 of the NDP titled, “inclusive rural economy”, outlines the NDP’s vision for the development of rural areas. Its focus is sustainable land reform and agrarian transformation, which encompasses the mandate of the Department. The NDP is implemented in 5-year phases, which are outlined in Government’s MTSFs.

Agriculture is identified in the NDP as one of the key sectors through which increased employment and poverty alleviation can be achieved. In this regard, approximately 1 million new jobs and a trade surplus are expected to be created from agriculture, agro processing and related sectors by 2030. The NDP further expects that a third (33%) of the food trade surplus should be produced by smallholder producers by 2030. With regard to land reform, it sets a target to redistribute 16.5 million hectares or 20 percent of commercial agricultural land by 2030. By 2018, Government had redistributed close to 10 per cent of commercial agricultural land. It thus suggests that in the next 10 years, over 10 per cent of commercial agricultural land must be redistributed.

 

2.2     Medium Term Strategic Framework 2019-2024

 

The MTSF is the Government’s strategic plan for the 2019-2024 period. It is a five-year implementation phase of the NDP that is outcomes-based. It takes into account the New Growth Path (NGP), the Industrial Policy Action Plan (IPAP) and other Government policy foci. The MTSF 2019-2024 is the second implementation plan of the NDP, following the MTSF 2014-2019. The MTSF’s aim is to ensure policy coherence, alignment and coordination across Government Plans, as well as alignment with budgeting processes.  The MTSF 2019-2024 aims to address challenges of poverty, inequality and unemployment through the following pillars:

• Achieving a more capable state;
• Driving a strong and inclusive economy; and
• Building and strengthening the capabilities of South Africans.

The above three pillars underpin Government’s seven Key Priorities that have been adopted to implement the current MTSF. The 7 Key Priorities are expected to be achieved through the joint efforts of government, the private sector and civil society. For each MTSF Priority, a number of Outcomes and associated interventions are outlined in an Implementation Plan and a Monitoring Framework by which each relevant Department’s performance is going to be assessed by the Presidency in the five-year period. The Department directly contributes to five of the 7 Key Priorities, namely:

• Priority 1: A capable, ethical and developmental state
• Priority 2: Economic transformation and job creation
• Priority 3: Education, skills and health
• Priority 5: Spatial integration, human settlements and local government
• Priority 7: A better Africa and world

 

Most of the Department’s planned activities in the current MTSF period were informed by Priorities 2 and 5, which can be linked to approximately five outcomes and a number of specific interventions to which the Department will contribute. However, in its Strategic Plan and consequently, the 2020/21 APP, the Department has highlighted four MTSF Priorities, viz. Priorities 1, 2, 3 and 5. The Committee noted that, for each of the Priorities, the Department has not outlinedin its Plans, all the interventions to which it is expected to contribute by the MTSF. 

 

2.3        The 2020 State of the Nation Address 

 

The key priorities of the Sixth Administration as highlighted in the President’s State of the Nation Address (SONA) with regards to the Department are as follows:

• Restitution: focusing on the land restitution cases that have not been resolved since 1998;
• Labour Tenants’ claims: the resolution of labour tenants’ claims to ensure that their land rights are restored not only in law, but also their land based livelihoods;
• Agricultural activities: increasing the market share of black producers in the various sectors of the agricultural economy, in both primary production level and the agribusiness industry;
• Rural development: building infrastructure that will support farmer production units located in the 44 districts of the country and social infrastructure such as rural roads;
• Social development: speedy release of state land for human settlement as well as agricultural development;
• Deeds registrations: transforming the deeds registry to record the land rights in South Africa. To this end, a policy for the transformation of deeds registries and supporting tenure legislation that encompass recording of land rights in the communal areas of South Africa would be developed.

 

1. Overview of the Strategic Focus of the Department of Agriculture, Land Reform and Rural Development, 2020/21 Annual Performance Plan and Budget Allocation

 

3.1     The Department of Agriculture, Land Reform and Rural Development and its Core Functions

 

The main aim of the Department of Agriculture, Land Reform and Rural Development is to provide equitable access to land, integrated rural development, sustainable agriculture and food security for all. The Department’s legislative mandate is derived from the following Sections of the Constitution of the Republic of South Africa, 1996:

• Section 24(b)(iii) (environment and natural resources clause) and 27(1)(b) (food and water clause) that cover the agricultural value chain and resources. 
• Section 25 (property) that establishes the framework for the implementation of land reform.
• Section 27(1) (health care, food, water and social security clause) that establishes the framework for the implementation of the comprehensive rural development programme.

 

The Department executes its legislative mandate by implementing, managing and overseeing no less than 35 key pieces of legislation that cover inter alia land acquisition, restitution and use; agricultural production and its value chain regulation; conservation of resources and the establishment of the Department’s public entities. The strategic focus of the Department in the current five-year strategic framework period is to accelerate land reform, catalyse rural development and improve agricultural production to stimulate economic development and food security. Based on this strategic focus, the Department has developed seven Strategic Outcomes for the current MTSF period aligned to MTSF priorities as shown in Table 2 below.

 

Table 2: Alignment of Department Outcomes and the 2020-2024 MTSF Priorities

Department Outcome (OC)	MTSF Priority (P)
OC1. Improved governance and service excellence	P1:A capable, ethical and developmental state
OC2. Spatial transformation and effective landadministration	P5:Spatial integration, human settlements & local government
OC3.  Redress and equitable access to land and producer support	P2:Economic transformation & job creationand P5
OC4. Increased production in the agricultural sector	P2 and P3:Education, skills and health
OC5. Increased market access and maintenance of existing markets	P2 and P7. A better Africa & world
OC6. Integrated and inclusive rural economy	P2 and P5
OC7. Enhanced biosecurity and effective disaster risk reduction	P5

 

 

 

 

The Department has six programmes through which it will measure its Strategic Outcomes, namely:

 

• Programme 1: Administration;
• Programme 2: Agricultural Production, Health, Food Safety, Natural Resources and Disaster Management;
• Programme 3: Food Security, Land Reform and Restitution;
• Programme 4: Rural Development;
• Programme 5: Economic Development, Trade and Marketing; and
• Programme 6: Land Administration.

 

3.2     Overview of the 2020/21 Budget Allocation and the Medium Term ExpenditureFramework Estimates of the Department

 

The total budget appropriated to the Department has decreased from R17.2 billion in 2019/20 to R16.8 billion in 2020/21, representing a nominal decrease of 2.4 per cent. The reduction in the budget of more than R1 billion from 2019/20 to 2020/21 was attributed to a reduction in the budget of the Agricultural Land Holding Account and an amount of R282 million for the Marine Living Resources Fund, which is no longer part of the new Department but has been transferred to the Department of Environment, Forestry and Fisheries. Despite its important mandate for transformation and contribution to employment, the allocation to the Department constitutes one per cent of total Government expenditure for 2020/21. Over the medium term, the budget allocation to the Department increases by an average annual rate of 2.4 per cent in nominal terms but in real terms it decreases by an average annual rate of 2 per cent.

 

Approximately two-thirds of the total budget allocation will be shared between Programmes 2 and 3. Programme 2 (Agricultural Production, Health, Food Safety, Natural Resources and Disaster Management)accounts for 19 per cent of the total budget whilst Programme 3 (Food Security, Land Reform and Restitution) accounts for just under 50 per cent.  The allocation is a reflection of the Department’s key priorities for the medium term.

 

Table 3: Medium-Term Expenditure Framework

Programme/Branch	2020/21	2021/22	2022/23
	R'000	R'000	R'000
1. Administration	2,732,229	2,889,744	3,001,962
Ministry	78,882	83,304	86,269
Departmental Management	163,761	173,001	179,163
Internal Audit	63,340	67,005	69,500
Financial Management	283,953	301,375	312,111
Corporate Services	932,947	987,465	1,024,117
Provincial Operations	455,348	480,109	498,000
Office Accommodation	753,998	797,485	832,802
2. Agricultural Production, Health, Food Safety, Natural Resources and Disaster Management	3,220,722	3,463,387	3,522,940
Inspection and Quarantine Services	629,160	679,316	701,753
Plant Production and Health	688,330	776,895	840,975
Animal Production and Health	342,876	378,245	422,610
Natural Resources and Disaster Management	288,979	305,041	316,730
Agricultural Research Council	1,271,377	1,323,890	1,240,872
3.Food Security, Land Redistribution& Restitution	8,117,180	8,677,787	9,147,417
Food Security	2,034,392	2,172,137	2,235,416
Land Tenure Reform	529,488	602,180	405,783
Land Acquisition and Redistribution	1,214,557	1,307,179	1,360,274
National Ext. Services and Sector Capacity Development	603,634	630,684	640,882
Farmer Support and Development	13,351	15,610	16,192
Property Management and Advisory Support	289,972	302,806	504,315
Restitution	3,431,786	3,647,191	3,984,555
4. Rural Development	1,097,774	1,160,401	1,010,103
National Rural Youth Service Corps (NARYSEC)	290,303	202,534	202,785
Rural Social Infrastructure Coordination	779,282	928,013	776,227
Technology Research and Coordination	28,189	29,854	31,091
5. Economic Development Trade and Marketing	885,580	944,451	989,418
International Relations and Trade	211,824	224,976	233,419
Cooperatives Development	76,656	81,170	91,823
Agro-Processing, Marketing and Rural Industrial Development	597,100	638,305	664,176
6. Land Administration	756,571	811,110	849,097
National Geomatics Management Services	547,183	588,857	609,972
Spatial Planning and Land Use Management	209,388	222,253	239,125
Total	16,810,056	17,946,880	18,520,937

Source: DALRRD – PowerPoint Presentation to the Portfolio Committee, dated 05 May 2020

 

 

 

3.3     Overview of the 2020/21 Budget Allocations and Programme Performance Plans

 

3.3.1  Programme 1: Administration

 

The Programme’s purpose is to provide strategic leadership, management and support services to the Department. It comprises of the following sub-programmes: Ministry, Department Management,Financial Management, Internal Audit, Corporate Services, Provincial Operations and Office Accommodation. The total budget allocation to Administration in the 2020/21 financial year is R2.8 billion, a nominal increase of 1.9 per cent when compared to 2019/20 allocation. As Table 3 illustrates, Corporate Services and Office Accommodation sub-programmes account for the largest chunk of the budget (approximately 62 per cent). The Committee noted that there was a significant increase of23.3 per cent to the budget allocation of the Office Accommodation sub-programme when compared to the 2019/20 allocation.

 

The Committee has raised issues in respect of the following sub-programmes:

 

• Corporate Services:The significance of the sub-programme as a support mechanism to service delivery, was emphasised. However, of great concern was the Department’s track record with regard to implementation of its legislative programme and policy development. Both the former DAFF and DRDLR had difficulties in concluding policy and legislation development processes (e.g. Communal Land Tenure; Preservation and Development of Agricultural Land (PDAL)Bill, White Paper on Land Policy; Comprehensive Producer Development Support Policy and others). In the 2020/21 financial year Plan, the Committee was still concerned about lack of a clear legislative programme with time-frames with which the Department can be held accountable.

 

Additionally, weak monitoring and evaluation especially project assessments and determining the impact of interventions remains a challenge; for example, the impact of the Recapitalisation and Development Programme (RECAP), Comprehensive Agricultural Support Programme (CASP) and others. The Committee overemphasised the importance of monitoring and evaluation plans for the Department’s interventions and support programmes; and fast-tracking the finalisation of the Department’s structure and filling of critical vacancies particularly the placement of the 95 supernumerary positions at senior management service (SMS) level.

 

• Provincial Operations:The importance of the sub-programme wasacknowledged particularly for addressing challenges associated with concurrent functions and to strengthen monitoring of activities that are implemented by provinces including timeous reporting.  In this regard, placement and/or appointment of personnel in provinces should be fast-tracked.

 

• Office Accommodation:The Committee noted with concern the budgetary increase in this sub-programme compared to the previous financial yeardespite the merger of the two Departments and the decrease in the total Vote. The Department attributed the increase tovirements that have been requested from National Treasury due shortfalls that the Department carried in previous years in respect of rentals and municipal services as well as recurring debt of R197 million from former DAFF due to Fisheries properties that were devolved without funds.

 

3.3.2 Programme 2: Agricultural Production, Health and Food Safety, Natural Resources and Disaster Management

 

The purpose of the Programme is to oversee livestock production, game farming, animal and plant health, natural resources, and disaster management. The Programme comprises of the following sub programmes:

• Inspection and Quarantine Services to ensure compliance with regulatory frameworks for food safety;
• Plant Production and Health todevelop policy, and norms and standards to support plant production and plant health;
• Animal Production and Health topromote livestock production, game farming and animal health;
• Natural Resources and Disaster Management tofacilitate the development of infrastructure and the sustainable use of natural resources; and integrates, coordinates and implements disaster management policies and frameworks with special emphasis on mitigating disasters in rural and agricultural areas; and
• Agricultural Research Council to manage transfers to the Agricultural Research Council.

 

Whilst this Programme previously dealt with agricultural production, health and food safety, its mandate has now been extended to include Natural Resources and Disaster Management sub-programme, which has been allocated R289 million for the 2020/21 financial year. In terms of economic classification, approximately 59 per cent of the Programme’s total budget goes to transfers and subsidies, 40 per cent to current payments and 1 per cent to capital assets. Transfers and subsidies mainly constitute the R1.27 billion Parliamentary Grant to the Agricultural Research Council (ARC), which accounts for 40 per cent of the total budget of Programme 2 in terms of sub-programmes; and R631.2 million to provinces for the Ilima/Letsema (R548.8 million) and LandCare (R82.4) conditional grants. In terms of sub-programmes, the following was noted:

 

• Inspection and Quarantine Services: The sub-programme’s budget has increased from R582 million in 2019/20 to R629 million (20 per cent of Programme total) in 2020/21 to strengthen inspection capacity particularly at ports of entry.

 

• Plant Production and Health: This sub-programme received the second largest budget allocation of the Programme after the ARC, which is R688 million (21 per cent) due to the Ilima/letsema grant (R548.8 million). The sub-programme will oversee inter alia the ex situ conservation of Amaranthus and cucurbits taxa, the surveillance of 3 plant pests, development of the Cannabis Master Plan and theconversion of 10 000 hectares of cultivated fields from conventional to conservation agriculture practices. As Ilima/Letsema plays a very central role in household food production to address increasing household food insecurity, there was a concern that the only production target was 10 000 hectares for the entire country to convert fields from conventional to conservation agriculture practices. In addition, the indicator also does not mention expected yields from conservation agriculture practices and the Committee was also concerned about the competency of provinces in assisting farmers with application of conservation agriculture practices.

 

• For the Animal Production and Healthsub-programme, the focus is the disease risk surveillance for food-and-mouth disease (FMD), Peste des Petits Ruminants (PPR – contagious viral disease of sheep and goats also called ovine rinderpest) and contagious bovine pleuropneumonia (CBPP – bacterial disease of cattle also called ling plague), 100 per cent placement of veterinarians under the Compulsory Community Service (CCS) programme and implementation of Kaonafatso ya Dikgomo (KyD) and poultry improvement schemes among others.

 

The Committee raised a concern with the Department putting KyD scheme as a target in its APP although the same target, which is implemented by the ARC, was not met in the 2018/19 financial year including during the first two quarters of the 2019/20 financial year due to the failure of the Department to pay the ARC.A commitment was made to pay all outstanding debt to the ARC during this financial year. The Committee was further concerned with the capacity of the Department to achieve 100 per cent risk surveillance for the three animal diseases considering that for FMD, only 42 per cent risk surveillance was achieved by the end of the 2019/20 second quarter despite the constant FMD outbreaks that negatively impacted the country’s ability to export cloven-hoofed animals and their products, and consequently, employment in the livestock sector.

 

• Natural Resources and Disaster Management: Despite the many challenges that are facing the sector in terms of disasters and resource degradation, the sub-programme receives only 9 per cent (R289 million) of the Programme’s total budget for 2020/21, which is a decrease from the previous year’s R346 million. The LandCare grant, whose budget allocation remains stagnant, is implemented through this sub-programme.  A concern was raised about timeous and sufficient availability of drought relief assistance for farmers as the Department of Cooperative Governance and Traditional Affairs (COGTA) declared a national drought disaster on the 4th March 2020. The Department reiterated that it does not plan ahead for disasters but apply for funding after declaration and to date, COGTA has availed R139 million for drought relief while the need amounts to R1 billion. 

 

3.3.3 Programme 3: Food Security, Land Reform and Restitution

 

Programme 3 is responsible for acquisition and redistribution of land, and promotion of food security and agrarian reform, thus playing an important role in contributing to economic transformation and job creation (Priority 2 of the MTSF).  Its focus can be broken down into the following sub-programmes:

• Food Security toprovide national frameworks to promote sustainable household food security;
• Land Tenure Reform todevelop land tenure reform policies, programmes and procedures;
• Land Acquisition and Redistribution toprovide land acquisition and strategic institutional partnerships;
• National Extension Services and Sector Capacity Development to provide national extension support services, and sustainable growth and equitable participation in the sector;
• Farmer Support and Development todevelop and provides strategic support to farmers, agro‐processors and cooperatives;
• Property Management and Advisory Support toprovide property management and advisory support services;
• Restitution tosettle land restitution claims under the Restitution of Land Rights Act (1994).

 

The budget allocation for the Food Security, Land Reform and Restitution Programme in 2020/21 is R8.1 billion, accounting for 48.2 per cent of the Department’s total budget in 2020/21. Scrutiny of the allocation revealed that, there has been a nominal increase of 7.5 per cent.  The real decrease of the allocation has been influenced by significant decreases in the allocation for Land Acquisition and Redistribution; and Property Management and Advisory Support sub-programmes in 2020/21. This according to the Committee, does not go in line with Government’s call for accelerated redistribution of land. Given the heightened expectations for delivery of land due to the Parliamentary process of expropriation of land without compensation, any decline in allocations for land influencing the amount of hectares to be acquired is of great concern to the Portfolio Committee. However, the Committee commended the Department for the plan to prioritise making land already acquired productive. However, its position is that it should not be at the expense of acquisition of land to meet the public’s heightened expectations.

 

Of the R8.1 billion that is allocated to the Programme for the 2020/21 financial year, approximately 82 per cent is shared among three sub-programmes, namely, Restitution (R3.4 billion, which is approximately 42 per cent of the total budget of the Programme), Food Security (R2 billion, which is approximately 25 per cent of the total budget) and Land Acquisition and Redistribution (R1.2 billion, which is approximately 15 per cent of the total budget). Approximately 77 per cent of the Programme’s total budget is transferred to provinces, entities and households. In this regard, a concern was raised about the absence of a monitoring and evaluation framework. Further, there is a concern about the stagnant budgetary growth in two sub-programmes that are mandated to ensure sustainable food security, equitable agricultural sector participation and capacity development.

The following sections summarises the Committee’s observations regarding the sub-programmes:

 

• Food Security: The budget allocation increased by a few million from R1.94 billion in 2019/20 to R2 billion in 2020/21. This is a serious concern in light of the food insecurity challenge in the country, where Statistics South Africa (Stats SA) in a General Household Survey Report released last year found that in 2017, approximately 20 per cent of South African households (13.4 million people) had inadequate or severely inadequate access to hunger. The same Household Survey also revealed that of the 16.2 million households in South Africa, only 2.5 million (15.6 per cent) were involved in agricultural activity in 2017. In a recent report released on 20 May 2020, Stats SA highlighted that the hunger situation will be compounded by the Covid-19 pandemic as more people lose sources of income and some have already experienced hunger during lockdown. Another area of concern is that despite its mandated contribution to the implementation of the National Food and Nutrition Security Plan, the Department did not have a framework or a clearly defined indicator to measure food security but relies on quantitative targets that are implemented by provinces through implementation of producer support programmeswithout measuring impact.

 

• National Extension Services and Sector Capacity Development: The budget for this sub-programme decreased from R640 million in 2019/20 to R603 million in 2020/21. Although there is a budget of R315 million (decrease from previous year’s R368.6 million) from the CASP grant for Extension Recovery Planning (ERP), there is no specific target that is linked to Extension Services for the year under review, notwithstanding that in previous years, the Department placed extension practitioners with commodity groups for skills development to address the challenges associated with provision of quality technical support to producers and lack of it thereof.  For 2020/21, the Department plans to develop a status report on graduates that have been placed within its technical units and with commodity groups for a 24-months period, but there is no reporting about Extension Practitioners that have been placed. The Committee questioned the impact of such placements and whether acquired agribusiness skills are assessed to ensure guaranteed employment or entrepreneurship in light of the high graduate unemployment; and further raised a concern with the development of reports as annual delivery targets.

 

• With respect to Farmer Support and Development sub-programme, there has been a R2 million increase from R11.2 million in 2019/20 to R13.4 million in 2020/21. There are a number of support interventions that are planned for 2020/21 with the following targets, 150 smallholder and medium-term producers commercialised through Blended Finance Scheme (BFS), 200 farms through the Land Development Support (LDS) programme and 9 000 red meat producers. The Committee raised a concern with the imminent duplication in the three indicators, where the BFS will provide finance to smallholder producers and LDS will provide production inputs, infrastructure and operational costs to land reform farms, notwithstanding that the CASP grant also provides similar support as LDS and some BFS beneficiaries may also be land reform farmers. There is no technical indicator description for the support that will be provided to red meat producers and the Committee questioned the basis for choosing the commodity. There was also a concern that despite the merger, the former Departments seem to be operating independently as there was no rationale for continuing with different support programmes in the medium term when there is a Comprehensive Producer Development Support Policy that is being finalised to integrate all producer support.

 

The Blended Finance Scheme (BFS) is going to be funded through the Land and Agricultural Development Bank (Land Bank), which received R367.8 million through Programme 3 from the Department for commercialisation of producers in the 2020/21 financial year.In light of the Land Bank’s financial liquidity status and lack of accountability on the Scheme and other programmes, the Committee questioned the Department’s decision to continue using the Land Bank to implement the Commercialisation Programme and administer the BFS. The Committee was concerned with the absence of an accountability framework to ensure that the funds that are transferred to the Land Bank do not fall through the cracks particularly as the Land Bank has been downgraded to junk status.

 

The Committee further raised the following concerns:

• Alignment of the Strategic Plan and APP, for example, the reason to have anannual target for 2020/21 to implement the National Policy on Comprehensive Producer Development Support that has not yet been approved but listed under Planned Policies in the Department’s Strategic Plan and APP introduction.  The Department’s response was that because the Policy is at an advanced stage at Cabinet level, the 2020/21 indicator relates mainly to putting systems in place through creating awareness at district level in all provinces including establishing online platforms for producer support. 

 

• The significant decline in the budget allocation for CASP allocation, which has a potential to assist the country in job creation and economic growth; and the resultant impact of the decline on service delivery. The Department reported that the decline in conditional grants particularly CASP, was effected by the National Treasury and acknowledged that it will reduce the extent to which it can support farmers in need of infrastructure, training, mentorship, extension, and advisory services. The Department also mentioned expected delays in the revitalisation of infrastructure in Colleges of Agriculture despite the CASP allocation for infrastructure and upgrading of Agricultural Colleges has not been affected by the decline but rather increased in the MTEF period. In this regard, heightened oversight on the upgrading of Agricultural Colleges and accountability on resource use is emphasised.

 

• The rationale for increasing the target including the Department’s capability, to commercialise 2 500farmersinthe MTSF period, meaning approximately 500 farmers per year, when the Department failed to commercialise 450 farmers that were pronounced in 2017, notwithstanding the continued transfer of funds and utilisation of the Land Bank that is in financial crisis as an administrator of the BFS. The Department acknowledged the challenges with the implementation of the Commercialisation Programme for 450 farmers, which it admitted, were due to lack of control over the provincial plans. Henceforth, the Department has decided to implement the Producer Commercialisation Programme as a National Programme to ensure full control over its implementation but could not justify the utilisation of the cash-strapped Land Bank for administration of the funds.

 

• Land Tenure Reform allocation has significantly increased from R370.8 million in 2019/20 to R529.5 million in 2020/21, representing a nominal increase of 42.5 per cent. The Committee welcomed commitment to ensure tenure security, particularly in the former homeland areas. However, it expressed concerns over lack of legislation and poor capacity to develop and table legislation in Parliament within the set timeframes. Whilst the set targets for processing labour tenants’ applications were welcome, the Committee also noted with concern that other tenure programmes, especially implementation of the Extension of Security of Tenure Act (Act No. 62 of 1997) commonly referred to as ESTA and related farm dweller programmes were not clearly spelt out. The fact that the Land Rights Management Facility was being moved to Legal Aid South Africa, and there was no clear budget allocation was worrisome. The spate of farm evictions in some parts of the country require the Department to enhance its capacity not only litigation but also alternative dispute resolution mechanism. The renewed focus on Transformation of Certain Rural Areas Act (Act No.94 of 1998) with allocated budget was a welcome development.

 

• Land acquisition and redistribution is one of the top priorities of Government and Parliament is reviewing Section 25 of the Constitution to ensure accelerated land reform. The Committee applauded the commitment to redistribute land in line with Section 25(5) of the Constitution. However, it was concerned that the process to develop an overarching policy and legislation for redistribution, i.e. development of the White Paper on Land Policy and the Redistribution Bill appears to be extremely slow. The Committee noted that the process, as the Department explained, would be informed by the outcomes of the Parliamentary process to amend Section 25 of the Constitution. It thus means that until Parliament concludes amendment of Section 25 of the Constitution, the policy gap will remain.

 

Given the NDP target to redistribute 16.5 million hectares by 2030 (20 per cent of commercial agricultural land), the current pace of redistribution and budget allocation remains worrying. Redistribution alone is projected to contribute 157625 million hectares over the MTEF period. As a driver for equitable land access, this sub-programme is unlikely to reach the NDP target by 2030 if it continues to perform at this rate. Even if the contribution of restitution (discussed below) was included, that target is unlikely to be met. The Committee therefore suggested that the Department ought to put in place mechanisms, policy and otherwise, for proactive and accelerated land acquisition and redistributed to the landless poor, especially women and other vulnerable groups. For that reason, the area-based approach in line with the District Development Model presented an opportunity for scaling up delivery and maximising impact in particular areas of focus. The Committee envisagedthat over the MTSF period, the Department would scale up settlement of labour tenant claims, acquisition and allocation of land, release and allocation of well-located land for multiple use, including urban and peri-urban housing and urban agricultural initiatives.

 

• With regard to Restitution/Commission on Restitution of Land Rights (CRLR),the Committee noted that Restitution, which used to be a Programme in the DRDLR has been reduced to be a sub-programme of a broader programme of land distribution and promotion of food security. The Committee noted, with concern, that the budget for restitution decreases from R3.6 billion in 2019/20 to R3.4 billion in 2020/21, a nominal decrease of 4.5 per cent. The CRLR is expected to finalise 1 411 land claims over the medium term at a cost of R8.7 billion, which accounts for 16.3 per cent of the total budget.The decrease in budget allocation occurs at a time when the CRLR was meant to transition into an autonomous public entity as envisioned in the Restitution of Land Rights Act, and recently recommended by the Fifth Parliament’s Portfolio Committee on Rural Development and Land Reform and the Auditor-General of South Africa.

Some of the concerns of the Portfolio Committee can be summarised as follows:

• During the previous MTSF period (2014-2019), the CRLR tabled its Strategic Plan and APPs independently from the Department but for this MTSF, it did not citing a reason that it was not yet auntonomous.
• The sub-programmefocuses on two key performance indicators, i.e. settlement and finalisation of land claims. Critical areas of the work of the Commission such as research and verification are not shown in the plans of the Department.
• Key parts of Project Kuyasa, including key milestones for transition to an autonomous entity, could have been included in the plans. Whilst the Commission reported that the concerns of the Committee were in the operational plans, the Committee emphasised that some of the issues were high-level strategic focus areas that should be elevated into APP for transparency and accountability.

 

• The decrease in the targets for settlement of labour tenants’ applications from 3 666 applications in 2019/20 to 500 in 2021 was a great concern to the Committee. It noted that, as at 1 January 2020, about 10 992 applications had been settled and 9 333 were outstanding. The appointment of the Special Master for labour tenants at the Land Claims Court (Special Master) is believed to be the right intervention to enhance oversight over the implementation of Labour Tenants Land Reform Labour Tenants Act (Act No 3 of 1996). The Committee also expressed a concern about lack of a comprehensive database of labour tenants’ applications, a matter that it requested the Department to attend to immediately. However, it welcomed that the Special Master was developing the validated application information into a proper database. 

 

• The appointment of the Special Master and the Court order regarding labour tenants applications highlighted the significance of Parliamentary oversight and a need for the Portfolio Committee to oversee the process. Therefore, the Special Master together with the Department must provide an operational plan, which include creating a reliable and accurate database for labour tenants’ applications. The Committee anticipated accelerated processing of labour tenants’ applications and it also reaffirmed its oversight responsibility over implementation of the Labour Tenants Land Reform Act.  

 

3.3.4     Programme 4: Rural Development

 

The Programme of Rural Development, as was conceptualised in the former DRLDR, has been reconfigured and spread across other programmes of the Department. For example, rural enterprise development and Agri-Parks and other initiatives have been excluded from Programme 4, which solely focuses on the following three sub-programmes: 

• National Rural Youth Services Corps toprovide social organisation, youth development and economic upliftment;
• Rural Social Infrastructure Coordination tocoordinate infrastructure development in rural areas; and
• Technology Research and Coordination tocoordinate the provision of innovative and appropriate technologies in rural areas.

The interventions under the three sub-programes outlined above, in line with the NDP, are expected to create integrated and inclusive rural economies with quality basic services, particularly education, health care and public transport.

 

Over the medium-term, the Rural Development Programme has been allocated R3.3 billion, of which R1.1 billion is for 2020/21, a nominal decrease of 4.6 per cent from R1.15 billion allocated in 2019/20. The National Rural Youth Service Corps (NARYSEC) budget was substantially cut by 31.5 per cent from the previous financial year, i.e. decreasing fromR423.9 million in 2019/20 to R290.3 million. Further observations of the Portfolio Committee can be summarised as follows:

 

• Reduction of budget for NARYSEC could affect government efforts for skills development in the rural areas, thus undermining objectives to create inclusive economy. Nonetheless, the Committee welcomed the refocusing of the programme which is envisaged to address not only youth skills shortage but contribute to increase in employment of youth.
• Plans under this Programme do not explicitly indicate how it would, in the beneficiary selection, target vulnerable groups.
• Whilst Agri-Parks were not explicitly mentioned under this Programme, the budget for Rural Social Infrastructure Coordination (RSIC) would target Famer Production Support Units (FPSUs – a component of Agri-Parks). The Committee, however, was concerned that over the last five years, there was little or no progress with regard to FPSUs as demonstrated by the observations of the 2019 Portfolio Committee oversight visit in KwaZulu-Natal. Infrastructure development in some of the FPSU did not match the needs of farmers. It thus raises important questions about planning and whether the Department conducted needs assessment prior to interventions.
• The Committee applauded the Department for a review of the Agri-Parks model and establishment of a strategic partnership with the African Development Bank to leverage private sector investment.

 

3.3.5     Programme 5: Economic Development, Trade and Marketing

 

The purpose of this Programme is to promote economic development, trade and market access for agricultural products; and foster international relations for the sector. It comprises of the following sub-programmes:

• International Relations and Tradeto promote, coordinate and support international relations and trade through the development and implementation of appropriate policies and programmes;
• Cooperatives Development tofacilitate and support the implementation of programmes and initiatives to promote cooperatives to participate in economic development; and
• Agroprocessing, Marketing and Rural Industrial Developmenttoensure the transformation of primary product commodities into value‐added products, and ensure domestic and international market access.

 

Of the Programme’s total budget of R885.6 million for the 2020/21 financial year, R808.9 million (91 per cent) will be shared between two sub-programmes as indicated below. Through this Programme, the Department also makes the Parliamentary Grant (R47.4 million in 2020/21) transfer to the National Agricultural Marketing Council.

 

• Agroprocessing, Marketing and Rural Industrial Development sub-programme will receive 67 per cent (R597.1 million) of the total budget of Programme 5. This is in line with the Department’s focus on developing the agroprocessing value chain through value addition, increased market access and assuming responsibility for some rural development functions in respect of Farmer Production Support Units (FPSUs) and rural enterprise support. The Committee raised a concern with the Department’s targets that constitute mainly of capacity building and training activities without specific details and measurable impact of such activities. As an example, how will training of agroprocessing entrepreneurs (185 for 2020/21) ensure that they have access to markets and contribute to the creation of 1 million jobs by 2030 that are expected from the sector through agroprocessing by the NDP.
  • Clarity was sought on the difference between the 265 rural enterprises that will be supported through the Programme versus other producers that will be supported through for example, Programmes 3; including the specific role that the sub-programme will play in ensuring that the FPSUs are functional.
  • Notwithstanding that, CASP in Programme 3 also provides infrastructure support, the FPSUs, which will be coordinated under Programme 4,have been identified as a crucial infrastructure element in support of the implementation of the Agriculture and Agroprocessing Master Plan (AAMP) that is being developed. Under this Programme, the Department plans to support FPSUs with basic infrastructure, mechanisation support, input support, ownership support, human resources support and producer support.

 

• The International Relations and Tradesub-programme received R211.8 million (24 per cent of the Programme total) for the 2020/21 financial year. Through this sub-programme, the Department facilitates and coordinates trade negotiations and also makes transfers to foreign governments (diplomatic missions) and international organisations, the most significant being a R26.2 million to the Food and Agriculture Organisation of the United Nations (FAO) for 202/21. It also plans to review the Marketing of Agricultural Products Act, 1996 (Act No. 47 of 1996), whose review has been outstanding for the past 4 years and is the only legislation scheduled for processing in the 2020/21 APP. The Committee questioned the setting of targets for the sub-programme, whichprimarily constitute reportson engagements without specific details even in technical indicator descriptions, for example,“report on participation in AU and SADC engagements”.

 

• The Cooperatives Developmentsub-programme received R76.7 million, which is a reduction from the previous financial year’s R81.5 million. The Committee remains concerned with the Department’s quantitative indicators, where the target is the number of cooperatives that are going to be trained without measuring the impact of the training and ensuring that the trained cooperatives (148 for 2020/21) actually gain access to markets and participate in economic development.

 

The Department has a new indicator in Programme 5 to ensure that 100 per cent of AgriBEE Fund applications are finalised. However, the concern was how the Department is going to ensure the implementation as the AgriBEE Fund is administered by the Land Bank, whose challenges have already been highlighted and the Department had previously been unable to ensure that the Land Bank fully accounts on the utilisation of the AgriBEE Fund for transformation activities. For the year under review (2020/21), through Programme 5, the Department makes another transfer to the Land Bank (R39.5 million) for smallholder producer support. Oversight over funds transferred to the Land Bank was emphasised to ensure accountability and sector transformation.

 

3.3.6 Programme 6: Land Administration

 

The purpose of the Programme is to provide geospatial information, cadastral surveys, deeds registration and spatial planning; and technical services in support of sustainable land development. The Programme comprises of the following sub-programmes:

• National Geomatics Management Services (NGMS)responsible for examining and approving all surveys of land and real rights intended to be registered in the deeds office; maintaining records; compiling, maintaining and revising maps of property boundaries; providing cadastral advisory services to other government institutions; promoting and controlling all matters related to geodetic and topographical surveying; establishing and maintaining a network of national geo‐referencing stations; facilitating state surveys related to land reform; and providing cadastral and geospatial information services, including South African spatial data infrastructure;
• Spatial Planning and Land Use (SPLU)provides for national land use management and spatial planning systems; develops the national spatial development framework and rural development plans, guidelines, norms and standards; and ensures compliance with the Spatial Land Use Management Act (2013). The sub-programme also provides support to the South African Council for Planners and technical assistance to other spheres of government by providing spatial development frameworks and land use schemes; and establishing functional municipal land use tribunals; Registration of Deeds Trading Account toprovide a deeds registration system in which secure titles are registered and accurate information is provided;
• South African Council of Planners totransfer funds annually to the South African Council for Planners, a non-profit organisation dealing with the registration and other activities of the planning profession; and
• South African Geomatics Council toregulate and promote the transformation of the geomatics profession.

 

The budget allocation to this Programme has increased from an adjusted appropriation of R713.9 million in 2019/20 to R756.5 million in 2020/21. Over the MTEF period, the budget is expected to increase at an average annual rate of 6 per cent in nominal terms. NGMS and SPLU are priority sub-programmes and account for 99 per cent of the total budget of the Programme. The Committee welcomed plans to develop the five National Spatial Development Framework (NSDF) Action Areas Implementation plans by the end of 2020/21. The Committee was concerned about the capacity of the Department to ensure that the NSDFs implementation plans are finalised since they were only published for public comment in January 2020. The Committee noted that in the reconfiguration of the Department, work around Communal Property Associations (CPAs) has been moved to this Programme.  The Committee commended efforts to increase the number of compliant CPAs that is from 209 to 477. However, many other CPAs required urgent attention. Parliament has already processed the CPA Amendment Bill that introduces new measures to provide support to CPAs.  Given theplanned increase in capacity for supporting CPAs, the Committee was concerned with regard to decreasing number of CPAs to be made compliant in the following year.

 

4.       Overview of the Strategic Focus of the Public Entities of the Department, their 2020/21 Annual Performance Plansand Budget Allocation

 

The Department, as discussed above, oversee the operations of a number of national public entities of different status. For example, the status of the Commission on Restitution of Land Rights is currently under review with intension to ensure that it is fully autonomous as envisioned in the founding legislation. Table 4 below illustrates budget allocation for each entity.

 

Table 4. Budget Allocation to Entities for the MTEF Period 2020/21 – 2022/23

Entity R Million	2019/20 Adjusted Appropriation	MTEF Period Estimates
		2020/21	2021/22	2022/23
1.  Commission on Restitution of Land Rights	-	-	-	-
2. Ingonyama Trust Board	R21.5	R22.3	R 23.5	R 24.4
3. Office of the Valuer-General	R142.1	R144.5	R152.5	R158.1
4. Agricultural Research Council	R1 223.7	R1 271.4	R1 323.9	R1 240.9
5. Onderstepoort Biological Products	-	-	-	-
6. National Agricultural Marketing Council	R45.2	R47.4	R50.0	R51.9
7. Perishable Products Export Control Board	-	-	-	-
Total	R1 432.5	R1 485.6	R1 549.9	R1 475.3

   Adapted from National Treasury (Estimates of National Expenditure, 2020)

 

4.1     The Commission on Restitution of Land Rights

 

The CRLR is an autonomous institution established by the Restitution of Land Rights Act, 1994 (Act No. 22 of 1994) to solicit land claims, investigate them and attempt to resolve them through negotiation and mediation. In terms of the Public Finance Management Act (PFMA), 1999 (Act No. 1 of 1999), Commissions are part of national public entities. The mandate for restitution of land rights is derived from Section 25 (7) of the Constitution of the Republic of South Africa, 1996 which states that a “person or community dispossessed of property after 19 June 1913 as a result of past racially discriminatory laws or practices is entitled, to the extent provided by an Act of Parliament, either to restitution of that property or to equitable redress”. In 2021, unlike the period, 2014-2019, the Commission on Restitution of Land Rights did not table its own Strategic Plan and APP because its work is placed as a sub-programme of Programme 3.

 

4.2     KwaZulu-Natal Ingonyama Trust Board

 

The KwaZulu-Natal Ingonyama Trust Board is a land management agency that ensures that commercial activity on communal land is developmental and beneficial to local communities. The KwaZulu‐Natal Ingonyama Trust Act (1994) makes provision for the 2.8 million hectares of land spread across KwaZulu‐Natal (KZN) to be held in trust and managed on behalf of communities. The Ingonyama Trust Board administers the affairs of the trust. The ITB’s activities are guided by four strategic outcomes, namely: improved corporate governance and service excellence; improved stakeholder relations; improved security of land tenure and improved coordination of human settlement on communal land.

 

For 2020/21, the ITB operations are organised into two Programmes; namely, Administration (including corporate services and financial administration sub-programmes) and the Land and Tenure Management. Whilst the ITB has presented its budget during the meeting of the Portfolio Committee, such budget was not included in the tabled Strategic Plan and the Annual Performance Plan (APP). The APP does not clearly articulate how the ENE’s 2020/21 allocation for the ITB, of which R22.3 million is transfers from the Department, would be spent. The Committee also noted that the Department, at the time of the briefing, had not transferred money to the ITB because of its failure to submit expenditure budget.

 

AdministrationProgramme provides administrative support to the ITB so that the Board effectively executes and discharges its mandate. The Committee noted that this Programme has been expanded to include what used to be Traditional Council Support Programme.  The Committee made the following observations: 

• Whilst there are clear targets for support to Traditional Councils, there was concern that there is no indication of support to communities in line with the Act that says the ITB manages the land for material benefits of communities living on Ingonyama Trust land. Further, it is difficult to see how the ITB’s targets for women, youth and people with disabilities. 
• Policy development work of the ITB has long been in the plans but without much progress. Over the MTEF period, it plans to approve five policies. This still reflects targets that were reported to this Committee in 2018/19. It was therefore, clear that there was little or no progress with regard to policy formulation by the ITB.
• The ITB lacks adequate human resources capacity. It also did not indicate plans and targets for filling vacant positions in 2020/21.
• The capacity of the ITB has further been compromised byeither suspension and/or granting of special leave to all of its Executive Management. This has resulted in multiple labour disputes in courts.

Land and Tenure Management Programme provides property management, land tenure administration and valuation services to the ITB. It is intended to assist in the development of functional and effective Traditional Councils to manage utilisation for the benefit of communities living on the Ingonyama Trust land. The most crucial aspect of this Programme is to issue a land tenure rights approved by the Board. Over the MTEF period, about 3 200-tenure rights would be approved. The Committee noted the continued court challenge to issuing of residential leases to households or individuals who have long been residing on the land.

 

4.3     Office of the Valuer-General

 

The Office of the Valuer-General (OVG) was set up in terms of the Property Valuation Act (PVA), No.17 of 2014. Since its establishment in 2015, it functioned as part of the former DRDLR until March 2018 when it was listed as Schedule 3A public entity in terms of the Public Finance Management Act, 1999 (Act No. 1 of 1999). Its function is to conduct valuation of properties identified for land reform purposes, and to assist other departments that have requested valuation services for purposes of acquiring or disposing of property. The budget allocation for the OVG increases from R142.1 million in 2019/20 to R144.5 million in 2020/21 (Table 4), which is a nominal increase of 1.7 per cent. However, if inflationary adjustments are factored, the allocation represented a real terms decrease of 2.6 per cent at the time of reporting.

 

For the 2020/21 financial year allocation of R57.8 million (40 per cent) has been allocated for valuations and R86.7 million (60 per cent) has been allocated for operations. A closer look at the economic classification shows that of the R57.8 million for Valuations, R30.6 million (52.9 per cent) is for compensation of employees (CoE) whilst R27.2 million (47.1 per cent) is for goods and services. With regard to Operations, R45.9 million (52.9 per cent) is for CoE and R40.8 million (47.1 per cent) is for goods and services.

 

The Office of the Valuer-General runs a single Programme, i.e. Administration, whose focus is creating a high performing organisation that prioritises high ethical standards to deliver just and equitable valuations. It is divided into Valuations and Operations sub-programmes.

 

• Valuations sub-programme determines credible values in line with the Property Valuations Act.  The Committee applauded OVG for planning to ensure that all valuations referred to the office were 100 per cent completed within specified times. However, lack of capacity within OVG to deal to ensure 100 per cent performance was of great concern to the Committee. The concerns of the Committee were informed by its current record of accomplishment of 49 per cent completion of requested valuations that affected the Restitution Programme significantly. It therefore meant that there were backlog valuations that needed to be concluded. The Committee agreed to monitor the planned performance of an average of 50 days to issue a valuation certificate.

 

• Operations sub-programme seeks to create a high performing organisation that promotes high ethical standards to deliver just and equitable valuations. The Committee noted that the Minister together with approval of 21 critical posts approved the organogram. Recruitment process was reportedly underway at the time of the briefing. Whilst 20 positions were filled in 2019/20, it is planned that 41 vacant posts of the interim approved structure would be filled in 2020/21, and over the next two years, it plans to fill 45 vacancies. The Committee welcomed these initiatives and hoped that there would be improvement in the valuation of land for land reform purposes.

 

Given the capacity constraints reported in 2019/20, the Committee welcomed the initiative of the Ministerial Advisory Panel (MAP) which reviewed the Property Valuation Act (Act No 17 of 2014), thus attempting to clarify the mandate and role of the OVG as well as the methods, criteria and formula the OVG uses to determine property values.

 

4.4     Agricultural Research Council (ARC)

 

The ARC was established in terms of Section 2 of the Agricultural Research Act, 1990 (Act No. 86 of 1990) and is listed under Schedule 3A (national public entity) of the Public Finance Management Act (PFMA), 1999 (Act No. 1 of 1999). The ARC is the principal agricultural research institution in the county. Its primary mandate is to conduct research, and develop and effect the transfer of technology to promote agriculture and industry, contribute to a better quality of life, and facilitate and ensure the conservation of natural resources.

 

For the next five years, similarly to the Department, the work of the ARC is informed by five of the Government’s Priority Outcomes of the MTSF 2019-2024, viz. Priorities 1, 2, 3, 5 and 7 including the cross-cutting focus areas in respect of women, youth and people with disabilities.

 

For the medium strategic period, 2020 to 2024, the ARC has since developed six Strategic Outcomes that are aligned to the MTSF 2019-2024 Priorities as outlined below:

• Outcome 1: Increased agricultural production and productivity;

• Outcome 2: Sustainable ecosystems and natural resources;
• Outcome 3: Improved nutritional value, quality and safety of agricultural products;
• Outcome 4: A skilled, capable agriculture sector with innovation, knowledge and technologies;
• Outcome 5: Enhanced resilience of agriculture; and
• Outcome 6: To be a high performing and sustainable organisation.

 

The entity’s activities for the five-year period will be guided by, and measured against, the first five MTSF-aligned Strategic Outcomes. For the 2020/21 financial year, the ARC has been appropriated an amount of R1.27 billion through the Department’s Programme 2. The transfer constitutes baseline allocation for operational (R987 million) and capital (R284 million) expenditure. The ARC also receives additional funding for provision of national services and the maintenance of national assets from the Department and the Department of Science and Innovation (e.g. gene banks, inventories, national collections, climate monitoring, crop forecasting, diagnostic services, foot-and-mouth disease (FMD) Facility and information systems). One of the information systems is INTERGIS, which is a national electronic data handling system for beef and dairy cattle. For the construction and establishment of the FMD Vaccine Production Facility, the ARC was allocated R400 million for the medium term period. The ARC generates additional revenue through the provision of analytical and research services, the sale of farm products and rental income.

 

Due to the nature of its work, personnel costs are the highest cost driver, constituting 59 per cent of total expenditure for 2020/21 and consuming approximately 94 per cent of the Parliamentary Grant on average per year. As part of its Turnaround Strategy in working towards financial sustainability, for the next five years, the entity will be focusing on optimisation of personnel costs targeting a baseline reduction of R320 million; consolidation of the Pretoria campuses from eight to three; rationalisation of unutilised and underutilised land and properties; procurement savings and implementation of cost-saving initiatives in all its facilities and operations (energy, equipment, transport, animal feed, etc.).

 

The Committee’s concern on the optimisation of personnel costs was loss of skills and expertise (brain drain) to which the ARC responded that it is involved internally, with mentoring and coaching programmes; collaborates on knowledge sharing activities with academic institutions, other Science Councils and other sector stakeholders; and prioritises scarce and critical skills for capacity development. The Committee was also concerned with the slow pace of the establishment of the FMD Facility as funding allocation for the Facility was first made in 2018/19 and in light of frequent FMD outbreaks; the country needs an FMD vaccine manufacturing facility instead of relying on imports. Given the entity’s financial status, previous findings of the Auditor-General of South Africa (AGSA)on the entity’s revenue management and debt collection was emphasised by the Committee as a matter that needs attention. Most AGSA’s findings from previous years have reportedly been resolved and the ARC further reported engagements with architectural design experts and preparations to appoint a project manager to drive the FMD Facility project. 

 

4.5     The Onderstepoort Biological Products (OBP)

 

The OBP was established in terms of the Onderstepoort Biological Products Incorporation Act, 1999 (Act No.19 of 1999). It is listed under Schedule 3B of the PFMA, i.e. National Government Business Enterprise. It is governed by Act No. 19 of 1999, which should be read together with the Onderstepoort Biological Products Memorandum of Incorporation (MOI). The OBP is a state-owned bio-technical company that manufactures livestock vaccines and related products for the global animal health care industry. Its mandate is to manufacture veterinary vaccines and related products to prevent and control animal diseases that affect food security, human health and livelihoods. The OBP was declared as a National Key Point in 2007. The OBP does not get a financial transfer from the Department but funds all its operations from its self-generated revenue, mostly from sale of vaccines. 

 

For the medium term expenditure framework (MTEF) period, the OBP has adopted the following five Outcomes that are aligned to three MTSF Priorities (Priorities 1, 2 and 7) and will guide the implementation of its Corporate Plan:

• Outcome 1: Improve income and profitability
• Outcome 2: Expand product portfolio and access new markets
• Outcome 3: Supplier of choice optimised business processes
• Outcome 4: Improved product availability
• Outcome 5: Inspired staff striving for excellence – preferred employer

 

The entity’s total budget for 2020/21 is R184.5 million. The largest proportion of the entity’s budget for the year (44 per cent) will go to its Operations and Production Programme to ensure a steady supply of vaccines and continued work on the modernisation of the vaccine manufacturing plant. The OBP developed a new Turnaround Strategy as entailed in its Corporate Plan to address some of its key identified challenges, which include among others, loss of revenue due to loss of important markets, lack of good manufacturing practice (GMP) accreditation and unavailability of vaccines. The Committee was concerned with the OBP’s loss of revenue due to loss of markets and lack of GMP accreditation. However, its plans to turn around the situation including the measures that have already been implemented and the continuing work on the modernisation of the vaccine manufacturing facility to meet GMP compliance were appreciated. The Committee also raised a concern with the OBP’s previous struggle to be a vaccine supplier of choice to Government particularly provinces, and welcomed its engagements with the Department and the Minister,as well as the development of the Strategy to address the matter. The OBP further reported that it has mobilised internal resources to focus on Government and provincial business opportunities; and will start to engage provinces to formalise collaborations. In respect of the impact of the Covid-19 pandemic on its activities, the OBP reported that it suffered a revenue loss of R36 million from both local and international markets. As it is an essential service, during lockdown the entity has a third of its employees at work and has also decided to use the opportunity created by the pandemic to expand its product range by manufacturing sanitisers; and has since donated some to the value of R1 million. 

 

4.6     The National Agricultural Marketing Council (NAMC)

 

The NAMC is a national public entity that is listed under Schedule 3A of the PFMA. It was established in terms of Section 3 and 4 of the Marketing of Agricultural Products Act, 1996 (Act No. 47 of 1996) as amended by Act No. 59 of 1997 and No. 52 of 2001. Its mandate is enshrined in the MAP Act, which amongst others, authorises the establishment and enforcement of regulatory measures to intervene in the marketing of agricultural products e.g. the introduction of statutory measures. The NAMC also undertakes research, on its own accord or as directed by the Minister of Agriculture, Land Reform and Rural Development, to advise the Minister and the directly affected groups on agricultural marketing policies and their application; and coordinates work relating to the statutory measures as mentioned in the Act and the work of Agricultural Industry Trusts.

 

The NAMC has adopted three Outcomes against which its mandate will be measured in the MTSF 2019-2024 period. The Outcomes are also aligned to Priority 2 and 7 of the MTSF and are directly linked to the NAMC’s three Programmes for the year under review.  The three Outcomes/Programme are:

• Outcome 1: The NAMC delivers on its mandate and core functions;
• Outcome 2: An enabling agricultural marketing policy and statutory environment; and
• Outcome 3: The agricultural sector is viable, inclusive and competitive as a key economic sector.

 

The NAMC receives a Parliamentary Grant through the Department’s Programme 5; and for the 2020/21 financial year, an amount of R47.4 million has been appropriated to the NAMC. For the 2020/21 financial year, approximately 73 per cent of the entity’s total allocation goes to compensation of employees. The NAMC’s activities and interventions are centred on realising its three Outcomes. The NAMC has also been appointed by the Minister to coordinate the process of compiling the Agriculture and Agroprocessing Master Plan (AAMP). It reported that it was currently consulting widely at national, provincial and district level in an effort to design implementation plans for the AAMP with costed deliverables. The AAMP was expected to be finalised on 30 June 2020, however, due to the lockdown because of Covid-19, the deadline may not be met.

 

The NAMC is also the coordinator of the Strategic Integrated Project for agro-logistics (SIP11), although in a limited capacity due to unavailability of funding and delays in formal contracting. The NAMC’s role in SIP11 is to monitor infrastructure projects for reporting to the Presidency; and is part of an initiative by the Presidency on infrastructure investment where 12 of the SIP11 anchor projects were presented for funding consideration. While the Committee appreciated the NAMC’s initiatives and interventions to assistsmallholder farmers with market access, it raised a concern with lack of some crucial information in the NAMC’s Strategic Plan and APP that were introduced in Parliament versus the presentation that was done to the Committee specifically in respect of its Divisions, Programme activities and presentation of financial information.   

 

4.7     Perishable Products Export Control Board (PPECB)

 

The PPECB is a national public entity that is listed under Schedule 3A of the PFMA. It was established in terms of Section 2 of the Perishable Products Export Control (PPEC) Act, 1983 (Act No. 9 of 1983). In addition to the PPEC Act, it is also governed by the Agricultural Product Standards (APS) Act, 1990 (Act No. 119 of 1990). The PPECB’s mandate it to control the export shipment of perishable produce from South Africa and the order of shipment at all ports; makes recommendations on the handling of perishable produce when moved to and from railway trucks and other vehicles or cold stores; and promotes uniform freight rates for the export of perishable products. The PPECB is also mandated to conduct Food Safety Audits in terms of the APS Act on all Food Business Operators exporting perishable products of plant origin. The entity is also responsible for issuance of export certificates for perishable products. The Department since 2017, to manage the phytosanitary programme for citrus exports to the European Union (EU) until the end of the 2020 citrus season, also mandates the PPECB.

 

For the medium term strategic period, the PPECB has adopted the following four key Outcomes for its five-year Strategic Plan and 2020/21 APP, which are linked to the MTSF 2019-2024 Priority 2 and Priority 7:

• Outcome 1: Strengthen the PPECB’s capacity to provide a professional suite of services to its clients.
• Outcome 2: Contribute to the socio-economic transformation of the agricultural sector.
• Outcome 3: Enhance the credibility of the South African Export Certificate.
• Outcome 4: Support the export competitiveness of South African perishable products industries.

 

In light of the current economic climate and the changing business environment, the PPECB plans to pay specific attention to managing and controlling expenditure without compromising service delivery; and further recognises that it has to change from being merely a regulator to being an enabler. In this regard, the PPECB will concentrate on the following Strategic Focus Areas/Priorities for the medium term:

• Improved client experience through seamless integration with PPECB systems.
• The provision of relevant and timeous export information and market trends to enhance the competitiveness of the industry.
• Continuous improvement through a process of transformation, innovation and automation.
• Revised business models through the introduction of digitisation and change in methodologies to increase efficiencies and contain costs.
• Improved business sustainability for black smallholder farmers and suppliers.

 

The PPECB does not receive a Parliamentary Grant but generates its own revenue through fees and levies charged for inspections done on perishable products that are due for export and issuance of export certificates. For the 2020/21 financial year, the total budget of the PPECB is R494.3 million, which is expected to increase at an average growth rate of 9.6 per cent in the medium term expenditure period from 2020/21 to 2024/25. Approximately 65 per cent of its budget for 2020/21 will be spent on Operational Services.

 

The Committee acknowledged the role that is played by the PPECB in the export of perishable products from South Africa and enquired about its activities in ensuring participation of smallholder farmers in such markets; the impact of Covid-19 in its revenue generation capacity and how it uses its reserves. In response the PPECB reported that it is involved in the training of smallholder farmers on food safety, responsible use of pesticides and Good Agricultural Practices (e.g. SAGAP), which exposes farmers to the criteria that is necessary for Food Safety Certification that provides them access to more profitable markets including export markets. The Covid-19 pandemic has not yet affected the PPECB revenue but some of its stakeholders have been impacted by the lockdowns in terms of closure of borders, reduced operations at seaports and non-payment of orders. In response to the Committee’s query on the utilisation of its reserves, the PPECB reported that the utilisation of its reserves is regulated by the PFMA and is submitted annually to the National Treasury for approval.  The reserves are generally used to cover risks that are associated with the agricultural sector that the entity is exposed to, e.g. reduction in volumes due to drought, which result in budgetary shortfalls; uninsured risks and replacement of assets such as laboratory equipment. 

 

5.       Theresponse of the Department of Agriculture, Land Reform and Rural Development to the Covid-19 Pandemic through the Covid-19 Agricultural Disaster Support Fund

 

Approximately R1.3 billion was reprioritised for Covid-19 Agricultural Disaster Support Fund for Smallholder and Communal Farmers. The funding is a 2019/20 savings from the former DRDLR’s Land Reform Programme for which the Department had requested permission from the National Treasury to use the funds for the Covid-19 disaster. The Covid-19 Agricultural Disaster Support Fundwill be utilised as follows:

 

• R100 million to be transferred to Land Bank to assist distressed farmers with interest on their loans during the payment holiday.
• R400 million towards production support on Proactive Land Acquisition Strategy (PLAS) farms in line with the Stimulus Package.
• R775 million towards production support on all other Smallholder and Communal farmers.
• R20 million for hygiene products and personal protective equipments (PPEs) in villages. Distribution will be through traditional authorities and commodity organisations.
• R4.1 million for optical character recognition/reader (OCR) software for scanning of applications.
• R1 million for communication.

 

Farmers on PLAS farms will be supported in line with the Stimulus Package business plans that have already been approved.Other smallholder and communal farmers will receive support in the form of specific agricultural inputs to enable them to complete the current production cycle, the focus being on winter production. Their support will be capped at R50 000 per farmer.Commodities to be supported are as follows: poultry (day old chicks, point of lay chickens, feed, medication and sawdust), vegetables (seedlings, fertiliser, pesticides, herbicides and soil correction), fruits (fertiliser, pesticides and herbicides), other livestock (feed and medication) and winter field crops (soil correction, fertiliser, seeds, herbicides and pesticides).

 

Out of 55 000 applications that were received, 15 036, which represents 28 per cent of the applications. In this regard, the Committee raised a serious concern with the criteria that was used by the Department to approve applications including its obvious failure to assist communal farmers in particular, to ensure that they meet the criteria and were able to benefit from the Fund. It further highlighted that communication was poor and information did not reach most farmers while the Department also did not take into account lockdown restrictions, literacy levels of farmers and lack of access to technology.

 

Due to the urgency of the matter, the Committee requested the Department to urgently review the criteria that is used for the Covid-19 Agricultural Disaster Support Fund and strengthen communication and assistance to disadvantaged rural farmers, women and youth to ensure that they benefit from the Fund; and submit to the Portfolio Committee the approved National Farmer Register as well as the database of applicants for the Covid-19 Agricultural Disaster Support Fund (both successful and rejected applicants) including expenditure details of successful applicants and its plans for the  close to 40 000 (72 per cent) farmers whose applications were not successful or rejected. The Committee requested the submission of the reviewed criteria, the Farmer Register, the database of applicants and plans to assist unsuccessful applicants before the end of June 2020.

 

6.         Committee Observations

 

The Committee, having deliberated on the 2020/21 APPs and budget allocations of the Department and Entities, made the following observations: 

 

1. The Department of Agriculture, Land Reform and Rural Development

 

1. Whilst being cognisant of the fiscal constraints of the country, the overall decline in the Department’s budget over the MTEF period and budget reduction in key departmental Programmes such as Food Security, Land Reform and Restitution, as well as Rural Development are contrary to the Department’s aim and strategic focus for the medium term; and could potentially undermine service delivery in respect of the Department’s NDP mandate, which is further articulated in the MTSF 2019-2024.

 

1. The reduction in the Department’s budget also impact transfers to entities such as the ARC, which is not adequately funded given its essential role in ensuring up to date agricultural research and innovation to address imminent sectoral challenges that include climate change related high temperatures, water shortages, disease outbreaks and new pests; as well as impact of global trade competition. The Committee further highlighted the continued failure of the Department to pay its debt that is owed to the ARC, which negatively impacts the entity’s ability to meet some of its planned targets.

 

1. The MTSF 2019-2024 sets clear targets for participation of all vulnerable groups in the country’s economic activities. The Committee acknowledged that for the first time, the Department has included promotion of access to opportunities for women, youth and other vulnerable groups in its Mission; and together with its some of entities have consequently set targets in its Plans to ensure participation of vulnerable groups.

 

1. There is uncertainty regarding the Department’s capacity to develop essential legislation and policies to address sectoral challenges in light of the prolonged period it takes to finalise and/or implement policies and legislation, e.g. Communal Land Tenure Bill; Preservation and Development of Agricultural Land (PDAL) Bill; White Paper on Land Policy and the National Policy on Comprehensive Producer Development Support among others. The PDAL Bill was the target of the last MTSF (2014-2019), which the Department failed to achieve in five years and is still not included in the current APP for processing. 

 

1. The merger of the two Departments and the reconfiguration of the new structure does not seem to have taken into account the complexities of some of the Programmes that have now been combined into one, for example, the clustering of Food Security, Land Reform and Restitution into one Programme (Programme 3)could not be justified as there is no clear alignment in its interventions. For example, existence of different Farmer Support interventions within the Programme (e.g. CASP and Blended Finance from former DAFF and Land Development Support (LDS) from former DRDLR) could not be explained. Additionally, Land Reform, which has become a sub-programme, is not only about availing land for agricultural production but also for human settlement, tenure reform and security as well as economic development, which may not necessarily be agriculture-based.

 

1. The Department does not seem to have effectively used the opportunity presented by the structural reconfiguration to review its support programmes and their purposes. Conditional grants, specifically CASP and Ilima/Letsema,remain focused on certain primary agricultural activities while more employment opportunities may be generated in complementary sectors that are outside the grant requirements such as agroprocessing, which is identified as a key job driver and is central to the Farmer Production Support Units and the planned Agriculture and Agroprocessing Master Plan. This is notwithstanding training for agroprocessing entrepreneurs that will be provided through Programme 5, an indicator that is not clearly linked to the conditional grant recipients supported through Programme 2 and Programme 3.

 

1. Absence of a Monitoring and Evaluation Framework as part of the Department’s Annual Plans may affect accountability on performance and service delivery considering that half of the total Vote allocation goes to transfers and subsidies. Transfers and subsidies mainly constitute transfers to Departmental entities and others such as the Land Bank, as well as conditional grants, which are transferred to provinces for implementation of Departmental interventions and service delivery programmes. Whilst the Committee commends the strengthening of the Provincial Operations sub-programme, it emphasised that in the absence of an effective Monitoring and Evaluation Framework, transferred funds may be redirected to other activities.

 

1. There is a need for further engagements on the Commercialisation of Black Producers Programme and the Blended Finance Scheme including other funding and sector transformation instruments such as the AgriBEE Fund and Mafisa, which are administered by the Land Bank. During the current financial year, the Land Bank will be allocated approximately R408 million through Programmes 3 and 5 for the Commercialisation of Black Producers and smallholder farmer support. Lack of oversight by the Department on the utilisation of transferred funds to the Land Bank to ensure sector transformation remains a challenge.

 

1. Poor oversight and support by the Department of its public entities to ensure that their Plans are well aligned to their legislative mandates and where there are challenges, such are speedily addressed. The financial challenges in the OBP and ARC as well as governance challenges in the OVG, which were also compounded by the OVG not having an appointed Accounting Officer since its inception, were attributed to poor oversight and support from the Department.

 

1. Alignment of activities between the Department’s Programme 5 and the NAMC with respect to producer training and support for market access and market efficienciesneed to be clearly defined in their Strategic or Annual Performance Plans to ensure better coordination and to avoid duplication of activities. The country is party to the Trade Agreement on African Continental Free Trade Area, which was supposed to commence on the 01 July 2020 had the Covid-19 pandemic not happened, yet there are no clear performance indicators on how the Department will ensure that local producers benefit from the Agreement.

 

1. Notwithstanding that the responsibility for declaration of disasters including droughts, lies with the Department of Cooperative Governance and Traditional Affairs (COGTA), the Department did not present a drought management and response strategy for the agricultural sectorin light ofthe frequency of droughts and the negativeimpactthey have on the growth and sustainability of the agricultural sector, particularly the smallholder producers.

 

1. Programme plans and budgets to redistribute and allocate land do not match with NDP targets and people’s expectations for accelerated delivery of land to meet a range of needs from productive and residential land  in both rural and urban areas to well-located land in the cities, towns and peri-urban areas in order to dismantle the apartheid spatial planning.

 

1. Inadequate support to CPAs and Trusts (land reform)  contributes to the collapse of land reform farms and/or drop in agricultural productivity. Conflicts within CPAs is an indication of lack of, or inadequate, support to CPAs. If South Africa is to see an improved management of land reform farms, there is a need to improve support provided to CPAs.

 

1. Commission on Restitution of Land Rights (CRLR)

 

1. Restitution is a mandate of the CRLR established in terms of the Restitution of Land Rights Act, 22 of 1994. According to the PFMA, Commissions are included in the definition of national public entities. Incorporating Restitution as a sub-programme of a broad Programme is to downgrade the mandate of a national public entity into a sub-programme of the Department that could curtail the autonomy of a Commission envisioned in the Restitution of Land Rights Act. Further, the role of the Chief Land Claims Commissioner, the head of the CRLR or its accounting officer, becomes less visible under the Strategic Plan of the Department.

 

1. Some crucial key performance areas of the CRLR, which emanate from the Restitution of Land Rights Act, do not appear anywhere.Failure of the plans to outline plans regarding research, verification, and property valuation, which have been identified as key areas of  weaknesses, raises critical questionss about accountability and transparency because the Annual Report of the Commission might not highlight performance in these areas. Whilst all these are included in Project Kuyasa, which envisage the Commission transitioning into an autonomous entity in two years, none of the plans presented articulate key milestones for Project Kuyasa.

 

1. Whilst data shows that majority of outstanding land claims are in Limpopo, Mpumalanga and Kwazulu-Natal provinces, there were no adequate plans to demonstrate strategies to deal with bottlenecks in those provinces. As stated above, research and verification being key areas of concerns.

 

1. Absence of an outcome indicator for customer satisfaction on land claims and failure to present progress report on the status of land claims lodged to claimants who have been patiently waiting for the finalisation of their land claim does not help the CRLR to enhance its communication to claimants.

 

1. KwaZulu-Natal Ingonyama Trust Board(ITB)

 

1. Outstanding progress report with regard to the work done by the Inter-Ministerial Task Team that was set to deal with the challenges confronting the ITB impacts on accountability and oversight of the Portfolio Committee.

 

1. Absence of clear programmes to deal with empowerment of youth, women and people with disabilities in the rural communities living on the Ingonyama Trust land, in line with the purpose of the Board, i.e. management of the Trust for the material wellbeing of traditional communities on the Ingonyama Trust land, impacts on accountability of the ITB.

 

1. Numbers of vacancies at the ITB and the special leave of the Chief Executive Officer and the Chief Financial Officer has resulted in a collapse of management when the entire team of Executive Management was either in precautionary suspension or special leave. It collapsed management to the extent that it failed to table its budget, resulting in the Minister withholding transfer of the budget allocation for the ITB.  Failure to table the budget meant the Committee could not establish if the funds generated by the ITB were being used for the material benefit of deserving communities or not.

 

1. Tabled Strategic Plan and APP of the ITB did not contain budget information therefore, the status of the budget presented during the briefing session was uncertain.

 

1. Office of the Valuer-General (OVG)

 

1. Building capacity of the OVG without clarifying its mandate is unlikely to bring any fundamental change especially in relation to disputes to the valuations, thus delaying acquisition of land. Clarification of the mandate might require legislative amendments to ensure that its functions are in accord with the legislation.

 

1. There is a need to fast-track the filling of vacancies at OVG particularly the position of the CEO and other 21 additional critical poststhat have been approved to enable the entity to reduce the turnaround time to complete valuations from 125 days to 50 days as planned for the 2020/21 financial year.

 

1. Improving the capacity of the OVG means that the office should also have its own Enterprise Resource Planning (ERP) software/system and should be able to function on its own.

 

1. Agricultural Research Council (ARC)

 

1. The slow progress in the construction of the foot-and-mouth disease (FMD) Vaccine Facility for which funding was transferred since the 2018/19 financial year.Fast tracking the establishment and finalisation of the facility is very crucialin light of frequent FMD outbreaks and the country’s dependence on vaccine imports, mostly from Botswana.

 

1. Uncertainty regarding the implementation of the ARC’s Strategy to optimise personnel costs, which could possibly lead to retrenchments or resignations of critical personnel due to uncertainty; including the efficacy of the mentorship and coaching programmes to retain key personnel as the ARC has been losing research expertise despite the existence of the Professional Development Programme (PDP) for more than 10 years.

 

1. The ARC did not clearly articulate how the implementation of the Sustainable Turnaround Plan will ensure that the entity focuses on its core mandate, i.e. research and innovation (technology development) to address sectoral challenges instead of becoming an implementing agent for some of the Department’s programmes. 

 

1. Onderstepoort Biological Products (OBP)

 

1. Whilst the OBP’s challenges that are mainly associated with the aging infrastructure are understandable, there is a need to fast track the finalisation of the modernisation of the vaccine manufacturing facility to ensure that it is GMP-compliant and the OBP is able to recapture some of the lost markets.

 

6.6.2     The engagements with the Department, the Ministry, and the development of the Strategy to facilitate the supply of vaccines to Government and provinces by the OBP is commended. However, there should be milestones attached to it to ensure that by a certain period a number of provinces will be sourcing vaccines from the OBP.

 

1. National Agricultural Marketing Council (NAMC) 

 

1. Lack of alignment between the NAMC’s APP and the briefing Presentation in respect of key performance and financial information was notede.g. its 5 Operational Divisions, which were referred to in the briefing Presentation were not included in both the Strategic Plan and the APP.

 

1. The National Red Meat Development Programme (NRMDP) that was facilitated by the NAMC and largely funded by the former DRDLR has not been sufficiently marketed in provinces despite the crucial role it plays where it has been implemented, in securing market access for smallholder livestock owners.  The funding contract that the NAMC had with DRDLR for the NRMDP expires in September 2020, which may negatively affect the Development Programme’s sustainability and expansion.

 

1. The need for strengthened collaborations between the NAMC, the PPECB and the Department in the identification and securing of new export markets in light of the challenges that are faced by exporters of agricultural products and the negative impact that reduction in exports has on sector employment.

 

7.         Committee Recommendations

 

After discussions and deliberations on the Department and the Entities’ 2020/21 Annual Performance Plans (APPs) and Budget Vote 29, the Portfolio Committee on Agriculture, Land Reform and Rural Development makes the following recommendations to the National Assembly (NA) for the attention of the Minister of Agriculture, Land Reform and Rural Development regarding Budget Vote 29.

The Minister should -

 

1. Engage with the Minister of Finance to discuss the Department’s funding needsfor key Departmental Programmes such as Food Security, Land Reform and Restitution and Rural Development that are central to the Department’s NDP mandate; as well as Entities such as the ARC to ensure it focuses on its reserach and innovation mandate and the OBP to ensure that it fast-tracks the finalisation of the vaccine manufacturing plant and gets assistance for the procurement of its vaccines by provinces.Additional funding should also be sought for unfunded mandates such as the Strategic Integrated Projects for Agro-logistics (SIP 11) as infrastructure development is essentialfor the implementation of the AAMP; and the grant funding that is currently used for infrastructure development is not sufficient to address the demand. 

 

1. Submit to Parliament updated Legislation and Policy Review Programmes with clear time lines and available resources for processing and finalisation of such legislation and policies during the current financial year and the medium term period. In the case of legislation, indicate planned introduction to Parliament.

 

1. Finalise placements at SMS level in the reconfigured Departmental structure and ensure that critical and funded vacant positions at SMS level within the Department and its Entities (particularly OVG, ITB and NAMC) are filled as soon as possible to prevent instability and poor performance; and further ensure that employment equity targets are prioritised and adhered to.

 

1. Ensure the development of an Action Plan to review and streamline the Department’s existing support programmes and conditional grants into an integrated Producer Support Programme/Scheme that was envisaged when the National Policy on Comprehensive Producer Development Support was developed to avoid duplication and resource wastage. The Action Plan should show the alignment to the Department’s new mandate and the Farmer Production Support Units that are expected to be central to the implementation of the Agriculture and Agroprocessing Master Plan. 

 

1. Strengthen Reporting Guidelines and ensure the development of Monitoring and Evaluation (M&E) Frameworks for conditional grants and all funds that have been transferred to third parties including those transferred to Entities and the Land Bank for programme implementation while also ensuring that provinces and the Land Bank report on the utilisation of such funds on a regular basis. The Department should report to Parliament on its M&E activities during each quarterly briefing.

 

1. Additionally to the M&E Frameworks, ensure that the Department signs Service Level Agreements with the Land Bank and other relevant commodity or partner organisations particularly for the implementation of the Blended Finance Scheme, the AgriBEE Fund and the Land Development Support Programme before such funds are transferred. In the absence of the necessary accountability frameworks, transfer of funds should be withheld.

 

1. Submit to Parliament comprehensive progress reports on the implementation of the Commercialisation of Black Producers through the Blended Finance Scheme, transformation activities through the AgriBEE Fund and the support of land reform farms through the Land Development Support Programme.Further ensure that all farms acquired and allocated through the land reform programme are matched with the relevant farmer or settlement support including relevant extension services, access to finance, production inputs and market access.

 

1. Strengthen oversight and support to the Department’s Entities and report on interventions to ensure that the Entities implementtheir legislated mandates and also address challenges that prevent effective implementation of their mandates. For example, underfunding of the ARC and the protracted construction of the FMD Facility; the OBP’s inability to secure additional funding for some of its activities despite being a National Key Point and challenges with procurement of its vaccines byProvinces; the OVG’s governance and human resource challenges that have compounded its ability to fulfil its mandate as well as fast-tracking the autonomy of the CRLR.

 

1. Ensure that the Department collaborates with the NAMC to develop a Strategy for sourcing support for the continuation of the National Red Meat Development Programme (NRMDP), which has played a crucial role in improving communal livestock farmers’ profits by linking them to markets.

 

1. Enforce the alignment of the Department and Entities’activities through its Plans to ensure they work towards a common goal and impactful outcomes. For example, outlining the specific role of the Department, NAMC and PPECB (perishable products only) on capacity building of smallholder farmers for market access, implementation of interventions to ensure that they access markets including export markets, identification of new markets and measuring the impact of interventions. For the development of communal livestock farmers through the NRMDP, the specific and future role of the Department, Provinces, NAMC and ARC in the programme; and for Kaonafatso ya Dikgomo (KyD), the specific role of the Department and ARC. 

 

1. Review the mandates of the Department’s Entities and where there are complementaries and possible duplication of functions, consider the amalgamation of such Entities.

 

1. Strengthen the Department’s contribution to the implementation of the National Policy on Food and Nutrition Security by streamlining food security initiatives within the Department to maximise food availability and stability; and measuring impact of interventions. Submit progress reports in Parliament that quantify primary production activities for both crop (yields) and livestock (reproductive capacity as represented by improvements in calving or lambing rates) production systems, funding instruments and resource allocation for each activity.

 

1. Ensure that the Chief Land Claims Commission submit a comprehensive Plan that outlines its strategic focus for the next three years, outlining key performance indicators in addition to the two that were included in the APP of the Department. The plan must also factor in Project Kuyasa Milestones.

 

1. Fast-track the process to ensure that the Commission on Restitution of Land Rights is restored to its status of a full commission not a sub-programme of the Department. Further, ensure that it is fully resourced with capable regional Land Claims Commissioners located in each province with delegated authority to settle land claims within the available financial resources.

 

1. Develop clear protocols and standard operating procedures to guide referral of matters to the Legal Aid South Africa, taking into consideration a need to build and/or strengthen internal capacity of alternative conflict resolution mechanisms in land tenure to avoid costly and lengthy court battles.

 

1. Present progress reports on a quarterly basis, detailing the work done with the Special Master, to settle labour tenants’ claims. Further indicate post-settlement support interventions for each settled claim and security of tenure for members of labour tenant communities in settled claims.

 

1. Ensure that the Ingonyama Trust Board officially tables its 2020/21 budget in Parliament by submitting an addendum to the APP it tabled earlier this year. The budget should reflect the purpose for which the ITB was established, that is to ensure that administration of the Ingonyama Trust land is for the material benefit to the traditional communities residing on the land in question.

 

1. In the light of failure to submit a report on funds used for material benefits of communities living on Ingonyama Trust land; further taking into consideration of the failure of the Ingonyama Trust Board to table the Strategic Plan and APP with budget for the 2020/21 financial year and special leave of the Executive Management of the ITB; put on hold the transfer of funds to the Ingonyama Trust Board until there is evidence of stability and accountability of ITB and that its programmes are benefitting the deserving communities on Ingonyama Trust land.

 

1. Investigate the underlying causes of the multiple labour disputes between the ITB and many of its senior management, resulting in paralysis of the Executive Management of the ITB, which is undesirable and affects the efficiency of the ITB. The investigation and report, which must include proposed interventions, should be completed within three months and submitted to the Committee within a month of completion of the report.

 

1. Fast-track the clarification of the mandate of the OVG, where necessary, legislative amendments must be initiated without delay.As stated above, further ensure that in this financial year, the vacant position of the Chief Executive Officer is filled.

 

1. Enhance capacity to support Communal Property Associations (CPAs) in line with the CPA Amendment Bill passed by both Houses of Parliament in order to be ready for implementation once signed into law by the President. Further ensure that support to CPA transcend the narrow focus on compliance to the CPA Act; it must focus on creating compliant and functional legal entities that administer communally-owned properties for the benefit of the members. 

 

1. Create capacity to speed up development of policy, especially review of existing land policy and development of a rural development policy, including legislation envisaged in Section 25(5) and 25(6) of the Constitution.

 

1. Ensure the development of a Drought Management and Relief Strategy for the agricultural sector that will spearhead the sourcing of additional funding for drought relief including its timeous and efficient implementation.

 

1. Prioritise the settlement of the debt that the Department owes the ARC before the end of the current financial year; and report on payment arrangements every quarter.

 

1. Fast-track the participation of the agricultural sector in the Trade Agreement on African Continental Free Trade Area (AfCFTA) while ensuring protection of local producers from unfair imports; and capacity building of smallholder producers to enable their full participation in the Agreement on AfCFTA.

 

1. Investigate and report to the Committee about all Government financial support services to the agricultural and agroprocessing sector for the 2020/21 financial year including the programmes or funding instruments that are implemented through, for example, the Department of Trade, Industry and Competition, the Industrial Development Corporation, the Jobs Fund, the National Youth Development Agency and the Department of Small Business Development inter alia. The report should also highlight the purpose of each programme, the targeted beneficiariesand how these different programmes are coordinated to avoid duplication and maximise impact of interventions; and to prevent double-dipping by some of the beneficiaries.

 

The Committee further recommends that,unless otherwise indicated, within three months after the adoption of this report by the National Assembly, the Minister should submit to Parliament, responses to the above recommendations.

 

Report to be considered.