ATC221012: Report of the Select Committee on Appropriations on the Expenditure and Performance of the Land Care Programme Grant as at the End of the Fourth Quarter of the 2021/22 Financial Year and the First Quarter of the 2022/23 Financial Year; Dated 12 October 2022

NCOP Appropriations

Report of the Select Committee on Appropriations on the Expenditure and Performance of the Land Care Programme Grant as at the End of the Fourth Quarter of the 2021/22 Financial Year and the First Quarter of the 2022/23 Financial Year; Dated 12 October 2022

 

1. Background

Section 4(a), (d) and (e) of the Money Bills and Related Matters Act No. 09 of 2009 (as amended in 2018), mandates the Committee to consider and report on spending issues; reports on statements of actual expenditure published by the National Treasury; and any other related matter set out in the Act. These provisions, read together with section 32 of the Public Finance Management Act No. 01 of 1999 (as amended), and section 16 of the Division of Revenue Act No. 05 of 2022, provides the framework for the legislative sector to play an oversight role over the Executive. Against this background, the Committee undertook to assess the implementation, performance and expenditure of the Land Care Programme Grant as at the end of the fourth quarter of the 2021/22 financial year and the first quarter of the 2022/23 financial year. The purpose of the Grant is to optimise productivity and enhance sustainable use of natural agricultural resources leading to greater production, food security, job creation and a better life for all.

 

2. Terms of reference

Due to under-spending by some provinces, the Committee resolved to conduct a hearing on the expenditure and service delivery performance of this Grant on 31 August 2022. Four provincial departments of Agriculture, Land Reform and Rural Development (Gauteng, Limpopo, Northern Cape and North West) were invited to report on their financial and non-financial performance as at the end of the fourth quarter of the 2021/22 financial year and the first quarter of the 2022/23 financial year. The Department of Agriculture, Land Reform and Rural Development was also invited, and it chose to table a consolidated report of the four provinces. In addition, National Treasury was invited to provide a consolidated report on the performance of the Grant in the period under review.

 

3.  Grant outputs

The overall outputs of the Land Care Programme Grant are -

• Hectares of rangeland protected and rehabilitated;
• Hectares of arable land protected and rehabilitated;
• Hectares of land under conservation agriculture;
• Number of farmers using conservation agriculture;
• Number of youths successfully attending organised junior Land Care initiatives;
• Number of hectares of land where water resources are protected and rehabilitated;
• Number of capacity building initiatives conducted for land carers and institutions;
• Number of people who benefited from capacity building initiatives;
• Number of awareness campaigns conducted;
• Number of people more aware of sustainable use of natural agricultural resources;
• Hectares of land where weeds and invader plants are under control;
• Number of kilometres of fence erected;
• Number of green jobs created, expressed as full-time equivalents (FTEs); and
• Number of Land Care Committees established.

 

The Grant outputs range from the number of hectares of land that is rehabilitated and conserved to include the number of beneficiaries of capacity building initiatives and green jobs, and the number of guidelines and legislation developed to manage the country’s natural resources.

 

4.  National Treasury

National Treasury submitted that in the 2021/22 financial year, the Grant had been allocated R89.8 million, of which provinces had spent R74.2 million, or 82.6 percent. Of the selected provinces, Gauteng had spent R2.2 million of the R5 million allocated to it; Limpopo had spent R8.5 million against an allocation of R15.5 million; the Northern Cape had spent R5.1 million of an allocation of R9.1 million; and North West had spent R9.5 million of its allocation of R10.9 million.

 

By the end of the first quarter of the 2022/23 financial year, the expenditure by these provinces had been relatively poor. Gauteng had reported zero expenditure of the R5.2 million budget and Limpopo had spent R1.2 million, or 9.6 percent of the total allocation of R13.3 million. While the Northern Cape and North West could not spend their actual Grant funds; both provinces had spent from their own revenue while waiting on the Grant transfers. The Northern Cape, whose total Grant allocation was R7.8 million, had spent R2.4 million of own revenue and North West, whose total allocation was R8.9 million, had spent R11 000 of its own revenue. The Grant funds had since been transferred to these provinces.

 

The National Treasury reported the following challenges and risks in relation to the Grant:

• The late approval of business plans and transfers to provinces resulted in projects being implemented later than planned.
• Procurement delays, with goods and services delivered late (after the planting season) had a negative effect on delivery of outputs.
• Service providers were appointed late.
• Fencing projects were constantly delayed by rain and difficult terrain; the late delivery of materials; and contractors declining orders because of the prohibitive cost of materials.

 

The National Treasury made the following recommendations:

• The sector must streamline the business plan process so that business plans were approved as planned, and transfers made according to the payment schedule.
• Procurement delays should be resolved to ensure goods and services were delivered on time, considering the seasonal nature of outputs.
• The sector needed to reassess the delivery of fencing projects, given the numerous challenges provinces faced.    
• Overall monitoring of the Grant needed to be strengthened, so that challenges and risks were highlighted early and mitigated.   

 

5. Department of Agriculture, Land Reform and Rural Development

5.1 Land Care principles, process and roles

The Department of Agriculture, Land Reform and Rural Development (DALRRD) reported that the six principles of the Land Care Programme were as follows:

• Integrated sustainable natural resource management embedded within a holistic policy and strategic framework where the primary causes of natural resource decline are recognized and addressed.
• Fostering group or community based and led natural resource management within a participatory framework that includes all land users, both rural and urban, so that they take ownership of the process and the outcomes.
• The development of sustainable livelihoods for individuals, groups and communities utilising empowerment strategies.
• Government, community and individual capacity building through targeted training, education and support mechanisms.
• The development of active and true partnerships between government, land care groups and communities, non-government organisations and industry.
• The blending together of appropriate upper level policy processes with bottom up feedback mechanisms.

 

The DALRRD further explained the process followed with the approval of business plans and the implementation of the programme. Within this process, the DALRRD had the following responsibilities:

• Host the national assessment panel (NAP).
• Provide the guidelines and criteria for the development and approval of business plans.
• Monitor implementation of the programme in line with the grant framework.
• Submit quarterly performance reports to relevant stakeholders.
• Submit evaluation reports to the National Treasury and any other relevant stakeholders.

 

The provincial departments had the following responsibilities with Grant implementation:

• Hold provincial assessment panel (PAP).
• Ensure the province has adequate capacity to implement Land Care projects.
• Implement the projects according to the approved business plans.
• Submit financial reports and quarterly non-financial reports.
• Monitor project implementation and evaluate the impact of projects towards achieving Land Care goals.
• Promote best practises.

 

5.2 Financial performance

The DALRRD reported that, of the R83.3 million allocated for the Grant in the 2021/22 financial year, only R80.5 million had been transferred to provinces. Gauteng had received only R2.2 million of its initial allocation of R5 million; of which it had spent 44.8 percent. Limpopo had received R13 million and had managed to spend R8.5 million, or 65.6 percent. The Northern Cape had received R7.6 million and had managed to spend R6.7 million, or 87.5 percent; and the North West had received R8.7 million and had managed to spend R8.5 million, or 97.3 percent.

 

For the 2022/23 financial year, none of Gauteng’s allocation of R5.2 million had been transferred in the first quarter, as the province was yet to finalise its business plan; while Limpopo had received R5.9 million of its R13.3 million allocation; Northern Cape R3.5 million of R7.8 million; and North West R4 million of its R8.9 million allocation. Only Limpopo had managed to record any spending in the first quarter, spending R1.2 million, or 9.5 percent.

 

5.3 Non-financial performance

The DALRRD reported on the selected provinces’ performance outputs in the 2021/22 financial year in nine key performance areas (KPAs).

 

5.3.1 Soil protection

Gauteng and North West had zero outputs, while the Northern Cape had rehabilitated or protected 800 hectares of cultivated land and Limpopo had constructed 5 kilometres of waterways or contours.

 

5.3.2 Rangeland management

Gauteng, Limpopo and the Northern Cape had zero outputs, while the North West had achieved 886 hectares of land where bush encroachment had been controlled, against a target of 998 hectares.

 

5.3.3 Conservation of water resources

Gauteng, the Northern Cape and the North West had zero outputs, while Limpopo had reportedly developed or protected four water sources against over-utilisation.

 

5.3.4 Control of weeds and invader plants

Gauteng and North West had zero outputs, while Limpopo had achieved 99 hectares and the Northern Cape 4 759 hectares of land where weeds and invader plants were under control.

 

5.3.5 Junior Land Care

None of the selected provinces had any outputs under this KPA in 2021/22.

 

5.3.6 Land Care awareness

Gauteng and North West had zero outputs, while Limpopo had achieved 1 191 and the Northern Cape 80 with regard to the increase in the number of people made more aware of the sustainable use of natural resources.

 

5.3.7 Land Care capacity building and partnerships

Gauteng, the Northern Cape and North West had zero outputs, while Limpopo had reported 525 for the number of people with improved capacity and skill levels benefitting from capacity building initiatives.

 

5.3.8 Kilometres of fences erected

Gauteng and the Northern Cape had zero outputs, while Limpopo had reported 33 and North West 14, with regard to kilometres of fencing erected in grazing and arable land.

5.3.9 Conservation agriculture

Gauteng had zero outputs, while Limpopo had achieved 415 hectares of land under the conservation agriculture system and 369 farmers adopting the conservation agriculture system. North West reportedly had 36 farmers adopting this system and the Northern Cape had conducted one information day to promote conservation agriculture and reported 30 as the number of people with improved capacity and skill levels benefitting from capacity building initiatives.

 

As the business plans had only been finalised in June 2022, no performance outputs were reported by the selected provinces for the first quarter of 2022/23, with the exception of Limpopo, who had reported an increase of 50 under the number of people made more aware of the sustainable use of natural resources, as well as one land care committee established. Gauteng was yet to finalise its 2022/23 business plans at the time of reporting.

 

1. Findings and observations

 

1. The Committee noted that, for the 2021/22 financial year, the Land Care Programme Grant had been allocated a total amount of R89.8 million; however, at the end of the financial year provinces had only spent R74.2 million, or 82.6 percent. Those who reported slow spending included Gauteng, Limpopo, Northern Cape and North West.   

 

1. The Committee noted that, at the end of the first quarter of the 2022/23 financial year, Gauteng had reported zero expenditure of its R5.2 million budget, while Limpopo had only spent R1.2 million, or 9.6 percent of its allocation in the same period. The Committee further noted that the Northern Cape and North West could not spend their actual Grant funding and had spent from their own revenue while waiting for the Grant transfers.

 

1. The Committee remained concerned about the limited capacity in some provinces, including the lack of specialists, which delayed the business plan approval process and negatively impacted on other processes such as transfer of funds, appointment of contractors and procurement. Moreover, the Committee welcomed the fact that the DALRRD had taken steps to convene a workshop with provinces with specific focus on key challenges and to allocate officials from the national sphere to assist in this regard.

 

1. The Committee noted that the main focus of the Land Care Programme was preventative interventions, mitigating when disasters hit and addressing land degradation with the limited resources.
2. The Committee remained concerned about the implementation of consequence management for non-performing provinces, given that transferring officers had powers to withhold funds from a province through the Division of Revenue Act if there was no delivery or the business plans not submitted as required.    

 

1. The Committee noted that the under-spending in the fourth quarter of 2021/22 in the North West was mainly due to chemical shortages at the end of the financial year. Furthermore, a roll-over had been requested from the National Treasury and the chemicals had since been delivered and service providers paid.

 

1. The Committee remained concerned about the fact that North West had experienced challenges where the traditional leader at the Land Care Programme site had blocked the training of people as well as the delivery of materials; however, it welcomed the fact that the MEC had taken steps to resolve the matter and that plans were in place to improve spending.

 

1.  Recommendations

 

1. Gauteng, Limpopo and Northern Cape should take specific steps to improve expenditure as well as planning processes to ensure that the Land Care Programme Grant transfer is received timeously. They need to ensure that the Grant is spent according to plans as well as the requirements of the Grant framework. The Committee is of the view that National Treasury should intensify its various monitoring mechanisms, such as meeting with the sector on a quarterly basis, as reported to the Committee.

 

1. The Department of Agriculture, Land Reform and Rural Development should expedite the initiative of convening a workshop with all provinces, focusing on addressing capacity challenges in provinces as well as allocation of officials from the national sphere to help improve performance and produce realistic business plans on time.

 

1. The transferring officer should ensure that consequence management is implemented, as provided for in the Division of Revenue Act, and that other public finance management prescripts are followed, where necessary, to enforce compliance. However, the Committee is of the view that this should be done strictly in terms of Section 216 (3) of the Constitution to ensure Government acts in the interests of poor South Africans and service delivery.  The Committee further recommends that the Department of Agriculture, Land Reform and Rural Development should intensify interventions aimed at assisting provinces such as the Northern Cape, North West and Gauteng, where zero performance had been reported due to non-submission of business plans.

 

1. National Treasury should ensure that rolling over of funds is not encouraged, due to its negative impact on service delivery. However, when it does happen, such as in the case of North West’s under-expenditure due to chemical shortages, the approval process should be done in accordance with section 6.4.1 of the Treasury Regulations and section 30 (2) (g) and 31 (2) (g) of the Public Finance Management Act of 1999.

 

1. The National Treasury and the Department of Agriculture, Land Reform and Rural Development and its provincial counterparts should ensure that the Land Care Programme Grant is always prioritised and, where non-performance persists, consideration should be given to devolving the Grant to municipal level or to redirecting funds away from non-performing provinces to those who are proactive in their planning.

 

Report to be considered.