Department Strategic Plan and Budget Vote 25: briefing and Academic Commentary

Meeting report

AGRICULTURE AND LAND AFFAIRS PORTFOLIO COMMITTEE
1 March 2005
DEPARTMENT STRATEGIC PLAN AND BUDGET VOTE 25: BRIEFING AND ACADEMIC COMMENTARY

Chairperson:

Department Strategic Plan presentation
Estimate of National Expenditure 2005/2006 Vote 25: Agriculture

SUMMARY
The Committee was briefed on the Department of Agriculture’s strategic plan and how it tied in with their nine functional budget programmes. Technical detail was also presented on the budget. The consensus among Members was the need for the strategic plan and the budget to be in line with the issues raised by the President in his State of the Nation Address. A group of academics had also been invited by the Committee to comment on the strategic plan and budget. It allowed Members the opportunity to have more meaningful engagement with the Department on issues of concern. These included food security, land reform, the use of consultants and the impact of free trade agreements on the local agricultural sector.

MINUTES

Department Strategic Plan and Budget Vote 25
The Deputy Director-General (DD-G), Ms J Nduli, started the briefing with a short overview of the Department’s strategic plan. The theme of the plan was to form partnerships that would ensure poverty eradication and economic development. Ms Nduli proceeded to point out how the plan tied in with the organisational structure of the Department. Service delivery and the Department’s performance were identified as key areas. Mr L Mabombo, Chief Operating Officer, noted that the aim of the Department was to lead and support sustainable agriculture and promote rural development. The single most important challenge facing the Department was to supply sufficient food to the nation. The bulk of the briefing entailed a breakdown of each of the nine programmes of the Department and how each would contribute towards the achievement of the strategic plan. Administration, Farmer Support and Development, Economic Research and Analysis, Agricultural Trade and Business Development, Agricultural Production, Sustainable Resources Management, National Regulatory Services, Communication and Information Management and Programme Planning, Monitoring and Evaluation were each presented together with an explanation of its subprogrammes and its measurable objectives.

The respective programmes were presented by Mr Mabombo; Mr S Malatji, Acting Assistant Director-General; Mr A Swart, Assistant Director-General; Mr R Dredge, Acting Assistant Director-General; Mr S Moephuli, Assistant Director-General; Mr S Mkhize, Assistant Director-General; Ms K Mogajane, Assistant Director-General; Mr S Galane, Senior Manager: Agricultural Information Services; and Ms A Shokane, Senior Manager: Programme Planning.

Mr Marais, Assistant Director-General: Financial Management, concluded the briefing with a comparative analysis of the 2005/2006 budget with that of previous years. The Committee was given a breakdown of specific allocations. It was evident from the figures that there had been a steady decline in allocations for the years 1994 up until 2000 whereas it had been steadily increasing thereafter.

Discussion
Ms B Ntuli (ANC) asked whether skills development and training took place under each programme or whether it was done as a whole.

Mr Mabombo said that training was done on a centralised basis. Allocations for training were not done per programme but rather centrally.

Ms Mathumi (ANC) asked whether the budget’s skills development was in line with the President’s state of the nation address. She also asked what mechanisms the Department had in place for monitoring. It was further asked whether the Department made efforts to communicate in languages that people understood.

Mr Galane reacted that the Department had mechanisms in place to communicate in languages that people understood. A translation system was in the pipeline to encourage greater communication. He however conceded that the Department’s documents were still only published in English.

Ms E Ngaleka (ANC) asked why the budgetary allocation towards expenditure on consultants had been increased. She queried why the Department continued using expensive consultants.

Mr Mabombo stated that the work done by the consultants were usually of a nature that could not be done by the Department itself.

Mr J Bici (UDM) referred to Programme 9 on page 16 of the presentation and asked when the mentioned quarterly reports would be available. He also asked on which date the 1^st quarter started and the last quarter ended.

Ms Shokane said that the 1^st quarter started in April 2005 and the last quarter ended in March 2006.

Academic commentary
The academic delegation comprised of Professor N Vick, Mr M Karan and Mr T Mkhabela. The Committee had previously engaged with the academics and had asked for commentary on the Department’s Strategic Plan and the Budget. Mr Karan proceeded to outline the delegation’s comments. Questions as to whether the budget was sufficient, whether it would encourage growth and how the second economy could be brought into mainstream business were amongst the issues that had emerged during the previous discussions. Mr Karan pointed out that the budget was expansionary and that it was growth orientated. There had been an 18% aggregate increase in the budget. Mr Karan identified certain premises as points of departure. Amongst those mentioned was that growth could only take place if markets expanded, information and innovation created a competitive edge, and that market realities determined economic opportunities. Mr Karan went further by identifying certain market realities. Ever present saturation problems, the continued domination of supermarkets in the food sector and the cost competition with countries like China, India and Brazil needed to be contended with. He felt the Strategic Plan to be silent on innovation that was seen to be the driving force of consumption. Intellectual Property rights were also regarded as an area that needed greater inspection. Greater emphasis on human capital was encouraged, especially since it was believed that entrepreneurship drove economies.

Market infrastructure, capacity, target research, sources of growth and unfair trade were identified as some of the gaps in the plan. Mr Karan continued with comments on specific programmes of the Department. It was asked how the Farmer Support and Development programme would provide support to farmers on a day-to-day basis and what was done to attract private investment in agriculture. Reference was made to the Agricultural Trade and Business Development programme. It was felt that trade promotion strategies needed to be more aggressive and that government should provide greater support for the protection of food brands etc. Mr Karan said that private information was in the hands of the private sector and that the Economic Research and Analysis programme should provide incentives that would allow access to it. A need to identify new crops was identified as a shortcoming of the Agricultural Production programme. The point was made that the Sustainable Resources Management and Use programme was silent on land reclamation programmes. It was also felt that the National Regulatory Services programme needed to extend its risk management responsibilities on plant and animal diseases and pests to the SADC countries. A greater effort by the Communication and Information Management programme was encouraged in popularising agricultural studies at tertiary institutions.

Discussion
Mr Mabombo noted the comments and conceded that the Department was in a developmental state.
Mr Moephuli noted that a Patents Act was being drafted by the Department of Trade and Industry. The Act would cover patents as a whole and should transcend various government Departments.
Mr Swart pointed out that the strategic plan looked at the trends that the Department foresaw. A Departmental representative said that a project providing support to farmers would be finalised by 1 April 2005.

Dr A Van Niekerk (DA) asked what portion of the Department’s staff worked on a full-time basis with NEPAD. He referred to the agricultural credit scheme and asked how the monies were made available from a central level to where it was needed in the provinces. It was further asked what impact the free trade agreement with China would have on SA’s agriculture. Dr Van Niekerk noted that recently much had been said about genetically modified foods. He asked the Department to comment on the issue. In conclusion, it was asked what the acreage of high potential land in SA was and how much of it was in full production.

Mr Mabombo stated that the entire Department was involved with NEPAD. It was difficult to give an exact figure on the persons involved.

The DD-G explained that as a scheme rolled out, mechanisms for monitoring and implementation were put in place via agencies. Advisory services were also utilised.

Mr Swart said that China was a focus area for the Department. Exports of citrus and deciduous fruit to China were being considered. Negotiations were ongoing and a reconnaissance group would be sent to China in the near future. Mr Mkhize noted that there were 3 million hectares of high potential agricultural land throughout SA. The Conservation of Agricultural Resources Act ensured its usage and conservation.

The Chairperson implored Members to focus on questions relating to the Department’s budget. Mr Masithela asked what portion of land was to be transferred to disadvantaged people. He asked the Department to elaborate on the process and the sizes to be transferred. It was also asked what the delay on the GMO Bill was. The Chair asked why training of farmers was specifically provided for at Grootfontein.

A Departmental representative stated that the land to be transferred was agricultural state land. He explained that it was difficult to provide figures on the sizes to be transferred. Mr Moephuli said that the GMO Bill was on track and that it would be ready by September 2006. The DD-G pointed out that a specialised training institution was situated in Grootfontein.

Ms Mathumi noted that much had been said about the importance of investing in human capital. She however asked what the cost implications would be on a national and provincial level.

The DD-G felt the investment in human capital to be critical. Workshops had been held in order to identify shortages in staff.

Dr E Schoeman (ANC) asked in what way the increase in the budget enhanced the transformation programme of the Department. He additionally asked why training was done in the Communication and Information programme but not in the Farming programme. Dr Schoeman felt it inadequate to train farmers only on an annual basis. It was asked whether the Agricultural Research Council (ARC) had furnished its performance review report to the Department.

The DD-G emphasized that training took place on a centralised basis and that it was not concentrated in one specific programme. Ms Nduli said that the Department had not to date received the ARC report. It was expected that the ARC would deliver a report to Parliament later in the week.

Mr N Pihla (ANC) asked whether the functions of the Administration and that of the Planning, Monitoring and Evaluation programmes were not similar enough to amount to duplication of functions. It was also asked whether the 26% shortage in staff did not affect the attainability of targets.

The DD-G explained that the difference between the programmes was that the first dealt with the administration of the Department and the latter with the impact that the various programmes had.
Mr Mabombo noted that the shortage in staff affected the Department’s ability to deliver. He said that the Department together with the Human Sciences Research Council had a strategy in place for human resources development. Mr Mabombo explained that delivery targets were set according the Department’s available capacity.

Mr T Ramphele (ANC) asked how much information on farmers in the second economy was available. He asked if anyone knew how much they had produced within the last two years. Mr Ramphele also asked to what extent the budget addressed increased competition to farmers in the first economy. It was additionally asked if data on infrastructure in the second economy was available. Mr Ramphele lastly asked whether the budget addressed issues like food security.

Mr Dredge noted that the Department had engaged the services of Statistics SA to compile information on farmers in the second economy. Funding had also been provided to NEPAD for the purpose of compiling information on farming.

Mr B Radebe (ANC) noted that it was good that the budget was expansionary but raised concerns whether the monies allocated would be entirely spent. In the past budgets were not entirely spent. He also asked what the Department was doing to counter unfair trade practices that could negatively impact upon production. He also raised concern over the continued use of expensive consultants by the Department.

The DD-G emphasized that the budget was not enough for infrastructural development. Mr Swart said that measures were in place to deal with unfair trade practices. The application of rules of origin and the value addition for goods that were imported from outside the SADC region were some of the measures referred to.
Mr Mabombo pointed out that there had been a nine percent increase in the budget allocated towards the use of consultants. He explained that the Department could not perform certain functions and retained consultants to do so. The external audit of the Department by auditors and the transfer of funds by security firms were amongst those functions alluded to.

Mr A Nel (DA) noted that the strategic plan was silent on land reform. He asked whether the Department was co-operating with other Departments on the issue.

The DD-G said that the Departments of Agriculture and Land Affairs had agreed to establish a joint Committee dealing with land reform at national, provincial and local level.

The Chairperson commented that it would be useful to the Committee if the Department could provide detailed information on the duties performed by consultants. He also felt the issue of communicable languages used by the Department to be important. He emphasised the importance of training in agriculture with a view to making the agricultural sector a driver in the SA economy. The Chairperson also strongly felt that government should undertake research on agriculture and that the private sector should not be relied upon.

The meeting was adjourned.