The Budgetary Review and Recommendation Report of the Portfolio
Committee on Agriculture, Forestry and Fisheries, dated 19 October 2011
1. Introduction
Section 5 of the Money Bills Amendment Procedure and Related
Matters Act, 2009 (Act No. 9 of 2009) requires the National Assembly, through
its committees to annually assess the delivery and financial performance of each
national department.
1.1 The role of the Committee
The Portfolio Committee mandate is
to legislate, conduct oversight of the Executive, promote public participation,
facilitate international agreements and review matters of public interest in
relation to the Department of Agriculture, Forestry and Fisheries, as well as
its entities.
1.2 The Department
Vision
The vision of the department is to be a
leading, dynamic, united, prosperous and people-centred sector.
The vision is aimed to be achieved through
developing and sustaining a sector that contributes to, and embraces:
2. Department’s Strategic Priorities and Measurable
Objectives
2.1 Department’s 5-year Strategic Goals and Objectives
·
Promote environmentally sustainable production
systems.
·
Ensure the sustainable management and efficient
use of natural resources.
·
Ensure protection of indigenous genetic
resources.
·
Increase contribution to green jobs to improve
livelihoods.
·
Promote safe food by managing the level of risks
associated with food, diseases, pests, natural disasters and trade.
·
Establish and maintain effective early-warning
and mitigation systems.
·
Increase equity, ownership and participation of previously
disadvantaged individuals (PDIs).
·
Enhance systems to support the effective
utilisation of assets.
·
Improve social working conditions in the sector.
·
Provide leadership and support to research,
training and extension in the sector.
·
Increase growth, income and sustainable job
opportunities in the value chain.
·
Increase the level of public and private
investment in the sector.
·
Increase market access for South African and
·
Increase production of feedstock to support the
manufacturing sector.
·
Promote the use of feedstock by-products for
renewable energies.
·
Establish and strengthen cooperative governance
and functional relations with local and international stakeholders.
·
Strengthen policy, planning, monitoring,
evaluation, reporting and sector information.
·
Provide effective audit, investigative and
legal, human resources and financial risk management.
·
Improve departmental services excellence through
implementation of quality standards, Batho
Pele principles and the general legislative mandate.
·
Provide leadership and manage communication and
information.
2.2 Measurable Objectives of the Department
Programme |
Purpose |
Measurable objective |
Baseline |
Targets |
Administration |
The programme provides the department with the necessary
human recourses capacity, the facilities and ICT hardware to ensure the
efficient and effective execution of the mandate of the DAFF. The programme
is also responsible for the overall administration, stakeholder relations,
intergovernmental relations, communication and legal services of the DAFF. It comprises the programmes Corporate Services, Chief
Financial Officer (CFO), and Stakeholder Relations and Legal Services |
Fourteen Human Resources
Management (HRM) policies were submitted to the Governance and Operational
Policy Committee (GOPC) during the period under review. This constitutes
almost 90% of the set target. Micro-agricultural Financial
Institutions of South Africa (Mafisa) retailing institutions, disbursed loans
to 3 910 clients across the country for various agriculture-related
enterprises. This constituted 150% of the set target (2 600) for the period
under review and pertains only to loans. The target for the CASP was exceeded
by 194% from the 10% set target of 2 600 farmers. A total of 3 473
subsistence farmers were supported through the Ilima/Letsema projects. Altogether 100% of the fisheries
server mitigation project was completed, as well as Phases 1 and 2 of the
forestry user migration project. A total of 78% of performance
agreements for Senior Management Service (SMS) members was submitted by the
end of the fourth quarter. |
60% adherence 120 stakeholder relations . |
70% adherence 3 new functional relations established |
Policy Panning,
Monitoring and Evaluation |
The programme is responsible for the coordination of
policy development, research and technology development, as well as
monitoring and evaluation. Furthermore, it renders guidance to the strategic,
programme and project planning process and conducts statistical and economic
analyses. This is to ensure a greater impact of the DAFF policies and
programme. The programme comprises two subprogrammes, namely Monitoring
and Evaluation; Policy Development and Planning |
The Monitoring and Evaluation
Reporting (MER) Framework was approved by the Departmental Executive
Committee (DEXCO) published and made available on the departmental intranet. The Strategic Operational plan
Framework was also approved by DEXCO, published and made available on the
departmental intranet. The Strategic Plan of the DAFF
2011/12 to 2014/15 was tabled in Parliament. The Service Delivery Improvement
Plan (SDIP) for the DAFF was completed and published as Annexure 2 in the
Strategic Plan. |
58% |
5% |
Economic Development Trade and Marketing |
The programme is of key importance in directing the DAFF’s
priority to increase the sector’s overall contribution to national GDP growth
through the creation of viable and sustainable cooperatives and rural
enterprises, value-added products and an increase in exports. The
implementation of international relations and trade strategies will be
closely connected to marketing, in order to access foreign markets. The programme comprises three subprogrammes, International
Relations and Trade; Cooperatives and rural Enterprise Development; and
Agro-processing and Marketing. |
Memorandum of Understanding
(MoUs) and agreements with Based on preliminary data for
the 2010 calendar year, 43% of agriculture exports were exported to markets
other than the EU and the SADC. Again based on the preliminary data for the
2010 calendar year, 57% of agricultural exports went to the EU and the SADC –
the two biggest destinations for A feasibility report on the
establishment of fresh produce collation and storage facilities, for the
attention of the Industrial Development Corporation (IDC), the Land Bank, The
Department of Trade and Industry (dti) and the European commission Fund (ECF)
with a vies to possible funding, was completed during the period under
review. Approximately 241 sustainable
rural cooperatives (agriculture, forestry and fisheries) were established. |
Current M&E Systems National, provincial and local plans aligned to government strategic priorities |
Framework for MoUs and SLAs on M&E for government and stakeholders National, provincial and local plans aligned to new electoral mandate and MTSF |
Food Security and
Agrarian Reform |
The programme is meant to develop and facilitate the
implementation of appropriate agrarian reform policies and targeted
programmes, aimed at enhancing the contribution of subsistence and
smallholder producers to food security. This will be achieved through
education and training; the provision of national extension and advisory
services; and the promotion of transformation imperatives in the
agricultural, forestry and fisheries sectors. The programme comprises three subprogrammes, Food
Security; Sector Capacity Development; and National Extension Support
Services. Food Security is responsible for subsistence farming, smallholder
farming, smallholder development and the provision of inputs, implements and
infrastructure support. National Extension Support Services aims to develop
national extension policies and provide training and national extension
support. The latter two are to direct and support agricultural education,
training, as well as extension and advisory services un support of targeted
groups. |
The Grootfontein Agricultural
Development Institute (GADI) research report and the Grootfontein
Agricultural Journal were published. Service Level Agreements (SLAs)
on targeted and priority research projects were signed with the ARC for
implementation during the 2011/12 financial year. The draft Zero Hunger Strategy
and implementation Plan were completed. A draft Food Security Policy was also
completed. A total of 14 proposals on Telefood Programmes, in partnership
with the FAO, were approved and implemented. The National Delivery Forum for
Vulnerable Workers on farms and in forestry and fisheries was established
after the Terms of Reference (ToR) for its establishment had been adopted. The DAFF Partnership Model
(Sustainable Farming Model) pilot project, which is run in conjunction with
Grain SA, Agri SA, NWK Ltd and VKB Ltd, brought assistance to 15 grain
farmers in the Owing to effective coordination
of training, a total of 31 474 members of communities, including smallholder
farmers, the youth and women, were trained.
|
National Poverty Deprivation Index |
Monitor food availability at household level in the country |
Agriculture Production, Health and Food Security |
The programme identifies opportunities and develops
strategies, in order to optimise agriculture agricultural productivity and
profitability within the agricultural sector. The programme also manages the
risks associated with animal diseases, plant pests, genetically modified
organisms and the registration of products used in the agricultural fields. The programme comprises three subprogrammes, Plant
Production And Health; Animal production and Health; and Inspection Services
and Food Safety. Animal Production Health is responsible for creating an
enabling environment for increased and sustainable animal production through
the efficient use of genetic resources. It manages risks associated with
animal diseases by means of appropriate policies, legislation, norms and
standards, technical guidelines and other services. Plant Production and
Health focuses on increasing agricultural productivity with the emphasis on
sustainable plant production systems and the efficient use of genetic
resources. It also manages, risks associated with plant pests and diseases.
Inspection Services and Food Safety s responsible for food safety and quality
of regulated products provides for the national inspection service of
regulated products intended for local and international markets. |
Two feedlot facilities were
established in cooperation with the Limpopo and The training of 16 animal
surveyors for the Comprehensive Breed Survey in the Regulations for plum and prunes,
as well as nectarines and peaches, were submitted to the WTO for
notification. Regulations relating to the ban of the use of chlorpyrifos were
gazetted on May 2010. Research solutions on wheat
production and cultivar evaluation were completed and included clear recommendations
on the appropriate cultivars to be used in the northern and southern
productions areas. |
780 000 commercial farmers 200 000 smallholder farmers 4,07 % small farmers producing for sale |
4 000 commercial farmers 10 000 smallholder farmers 5,27 % small farmers producing for sale |
Forestry and Natural Resources Management |
Sustainable use and management of natural resources
underpin the agricultural, forestry and fisheries sectors. The programme is
to provide policy advice and coordinate the implementation of programmes
aimed at ensuring that forestry production is undertaken sustainably, within
the capacity of the landscape and climate. This includes encouraging
land-owners and managers to maintain and improve the natural resources base
on which agriculture production relies, namely soil, vegetation, water and
the atmosphere. The Resources Management part of the programme is to
contribute to policy and programme development and implementation in the
areas aimed at improving water access arrangements for all users, while
promoting its efficient allocation, use and sustainable managements. The
programme is also responsible for encouraging sustainable resources access
and use through the development of policies to position the agricultural,
forestry and fisheries sectors in such a way as to meet the challenges of
achieving sustainable production. It aims to provide accurate and reliable
information for improved natural resources management, which is essential for
the sustainable use of natural resources, policy development and programme
implementation. Resources Management is also responsible for promoting and
facilitating greater adoption of sound agricultural, forestry and fisheries
natural resources management at primary industries, communities and regions
through targeted programme to improve natural resources management practices
and management of the natural resources base; and to facilitate the
development of agricultural infrastructure and use of agricultural resources. Other activities include auditing natural resources,
compliance and law enforcement for natural resources management; controlling
migratory pests; rehabilitating and protecting agricultural land; and running
the community-based LandCare Programme. It will furthermore develop mitigation
and adaptation measures, aimed at risk and climate change. |
A total of 12 213 green jobs
were created through the Forestry Livelihoods Strategy and the LandCAre
Programme. A total of 1 000 ha were afforested in the During 201/11, altogether 25
fire protection associations (FPAs) were registered. A total of 571
commercial farmers, 2 024 smallholders and 2 314 subsistence farmers adopted
land-use best practice during the period under review. A vulnerability assessment was
conducted and three vulnerable areas were identified in the south-western
parts of the Short courses on Agro
meteorology were also presented at the University of the |
30% Estimated total water loss/nonrevenue water 95 wetlands rehabilitated per year 70% of land affected by soil degradation Existing extent of forest resources: 0,5 m ha (natural forests) 39 m ha woodlands |
2% Estimated total water loss/nonrevenue water 6 wetlands rehabilitated per year 1% (800 ha rehabilitated) Rate of deforestation reduced by 0,004 % (16 000 ha) |
Fisheries Management |
The aim of the branch is to contribute to maintaining and
restoring the productive capacity and biodiversity of the marine environment;
ensuring the protection of human health; as well as promoting the
conservation and sustainable us of marine living resources. The branch
further aims to ensure that the degradation of the marine environment as a
result of land-based activities is prevented by facilitating the realisation
of the duty on the part of the DAFF to preserve and protect that marine
environment through the application of the respective policies, priorities
and resources. |
The Transfer of Rights Policy
and the Small-scale Fisheries Policy were gazetted. The Policy on the
Transfer of Commercial Fishing Rights was published and gazetted. The
programme continues with the granting of interim relief measures pertaining
to exemption/permits. The Integrated Fisheries
Security Strategy (IFSS) is in draft format and is being distributed to
stakeholders for further inputs. A total of 20% of cases and
tip-offs were investigated in accordance with services standards, and 11
cases were registered. Altogether 12 849 units of abalone were seized, as
well as 19 units of West Coast rock lobster (WCRL). The Hake Recovery strategy
yielded good results and signs are evident that the stocks are in the process
of being rebuilt, albeit as a slow pace. The programme uses the standardised
catch per unit effort (CPUE) indices for each hake species, in order to
determine whether the stocks are increasing or decreasing. Abalone diving surveys were
completed in Zone B (20 transects). A preliminary joint survey was carried
out in conjunction with industry stakeholders. The stock assessment report on
The research project on spawning
sea urchins was successful. Phase 1 of the scallops’ grow-out trials was
completed. Negotiations were concluded with the Universities of Cape Town, Larval settlement studies and
photo period studies, aimed at the enhancement of gonad development, were
completed. Altogether 20% of the EU’s Food
ad Veterinary office (FVO) evaluation report recommendations regarding their
requirements have been completed. Joint partnership with law
enforcement and conservation agencies, e.g. With the SAPS, the South African National
Defence Force (SANDF), South African National Parks (SANParks), the SARS,
Kwazulu-Natal/Ezemvelo Wildlife and Swellendam were established and have been
maintained. |
Marine aquaculture policy
finalised Commercial fishing rights allocated, and policy frameworks developed for rights allocations in other commercial sectors Strategy in place for abalone and hake |
Conduct environment studies on 4
sites leading to the development of zones Finalised subsistence and smallscale fisheries policy and rights allocated Additional fishing rights on account of available TAE allocated in large pelagics fishery and appeals finalised Research on catch and/or effort limit for 22 fishery sectors and ecosystem interactions Continuous review of strategy for hake and abalone in respect of research, management and compliance |
3. Analysis of the Department’s Prevailing Strategic and
Operational Plan
3.1. The 2011/12 Strategic Plan
The Department underwent
major restructuring that resulted in the renaming and/or combining of some of
its programmes and reprioritising of its budget. While the Department had 7
programmes in 2010/11, in the current financial year (2011/12), the Department
has six programmes, three of which have new names. The Department has done away
with the former Programme 2: Production and Resources Management and Programme
3: Agriculture Support Services.
The sustainable use and protection of land and water mandate of the
former Programme 2 and the disaster risk
and management services mandate of the former Programme 3 have been added
to the Forestry programme in the current medium term expenditure framework
(MTEF) period. The rest of the activities of the former Programme 2, viz. agricultural productivity and infrastructure development now fall
under the new Agricultural Production, Health and Food Safety Programme and the
Food Security and Agrarian Reform Programme, respectively. The rest of the
activities of the former Programme 3 are now split between the Administration;
Trade Promotion and Market Access; as well as the Food Security and Agrarian
Reform Programmes.
These changes and how the
budget was reprioritised, which present a challenge in terms of continuity from
the previous financial year, are not explained in the Department’s Strategic
Plan. However, the National Treasury’s Estimates of National Expenditure shows
that there was a budget for these ‘new’ programmes in the past financial year
(2010/11). For all the Department’s programmes, some strategic outcomes and
indicators were not aligned with the strategic goals and/or objectives. These
issues were also highlighted in the high level review (not an audit) of the
Department’s 2011/12 Strategic Plan by the office of the Auditor-General. The
indicators are either not relevant or specific to the stated strategic
objective or outcome and some are not quantifiable. Some seem to be a result of
a ‘cut and paste’ job from previous years’ or draft documents. These
highlighted issues raise concerns regarding the level of the Department’s
engagement in the strategic planning process and the people who were involved.
Below are some examples of the misaligned strategic objectives and outcomes:
Examples of misaligned Strategic Goals, Objectives and Outcomes
Programme |
Strategic Goal |
Strategic Objective |
Strategic Outcome |
Outcome Indicator |
1.
Administration, Trade Promotion & Market Access, Fisheries |
Effective
and efficient governance |
Establish
and strengthen cooperative governance and functional relations with local,
regional and international stakeholders |
Advancement
of the SA agenda and sustainable development |
Contribution
to regional, continental security and stability |
The Indicator is not aligned
with the strategic goal, objective and outcome and will in no way strengthen
cooperative governance and functional relations, which are largely lacking
amongst government departments and other stakeholders. For example, in its Strategic Plan, the
Department mentioned working with the departments of Public Works and Rural
Development to create dams for cultivation and livestock but made no mention of
the Department of Water Affairs.
Programme |
Strategic Goal |
Strategic Objective |
Strategic Outcome |
Outcome Indicator |
2. Food
Security and Agrarian Reform |
A
transformed and united sector |
Provide
leadership and support to research, training and extension in the sector |
Increased
production enabled by extension support and appropriate technologies |
2000
extension personnel receiving targeted technical and generic training |
The Strategic Objective is
assumed to be referring to extension personnel, research institutions/agencies
and all categories of producers in the sector. The Outcome Indicator addresses
one aspect of both the Strategic Objective and Outcome.
Programme |
Strategic Goal |
Strategic Objective |
Strategic Outcome |
Outcome Indicator |
3.
Agricultural Production, Health & Food Safety |
Effective
and efficient governance |
Coordinate
government food security initiative |
Sustainable
agrarian reform |
An
increase in the number of smallholder farmers from 200 000 to 250 000 for
crop and animal production |
The Strategic Objective is
not aligned with the Strategic Goal and the Objective is neither specific nor
measurable. The achievement of sustainable agrarian reform will depend on
collaborative activities with other Departments e.g. Rural Development and Land
Reform (DRDLR)’s land redistribution programmes. In addition, there are also
other departments involved in food security initiatives.
Programme |
Strategic Goal |
Strategic Objective |
Strategic Outcome |
Outcome Indicator |
4.
Forestry |
Effective
and efficient governance |
Coordinate
government food security initiative |
Sustainable
agrarian reform |
An
increase in the number of smallholder farmers from 200 000 to 250 000 for
crop and animal production |
·
Agriculture, forestry and fisheries
sectors are all based on natural resources. The Department did not explain the
rationale for placing Natural Resource
Management, one of the Government’s key priority outcomes, as a
sub-programme of the Forestry Programme.
·
Secondly, climate change has an impact on all three sectors
and intensive agricultural production contributes to green-house gas (GHG)
emissions. The Department’s focus for climate changes activities is only on
Forestry.
·
Lastly, disaster risk management (and mitigation) is also an
overarching function and the Department did not provide the rationale for
placing it under Forestry. For example, natural and climate change related
disasters such as floods, drought or heat waves and disease outbreaks affect
all three sectors.
4. Analysis of Section 32 Expenditure Reports
An
analysis of the Department of Agriculture, Forestry and Fisheries’ Section 32
Reports was not done for the year under consideration.
5. Analysis of the Department’s 2010/11 Annual Report and
Financial Statements
The Department planned to
complete an Agricultural Production Strategy in 2010, which will promote growth
and development of subsistence, smallholder and commercial producers through
different commodity groups and strategies. The departmental policies’ central
focus is to address the challenges that are faced by rural and vulnerable
people by empowering them to create cooperatives and small, micro and medium
enterprises (SMMEs); facilitate access to development finance and improve
capacity building and mentorship. The Forestry programme’s priorities for the
medium term included the development of a strategy and fund for the SMMEs in
the sector; developing a strategy to address timber shortages; establishing
extension support for emerging growers and entrepreneurs; and reducing the
regulatory burden on small and merging businesses. The priorities of the
Fisheries programme included establishing and revitalising state-owned
hatcheries; developing aquaculture development zones; cage culture pilots in
state-owned waterworks and coastal areas; and doing research and development on
candidate culture species for aquaculture.
5.1. Overview
of the Department’s Performance for 2010/11
This section provides the
summary of key performance areas for each programme in relation to key
measurable objectives for the 2010/11 financial year as outlined in the
Department’s Strategic Plan and Annual Report for 2010/11.
Programme 1: Administration
The Department has
significantly reduced its vacancy rate from 17% to 11% by the end of the
2010/11 financial year due to the amalgamation of the agriculture, forestry and
fisheries components, thus, exceeding its target of 16%. The Department also
trained and developed approximately 53% of its targeted personnel, again
exceeding the 50% target as outlined in its Strategic Plan. The Department also
exceeded its target and made strides in addressing HIV and AIDS through
counselling and testing campaigns, individual case assessments and employee
service provision where necessary.
However, occupational health and safety might still be a challenge in the
Department as it managed to conduct only 7.8% risk assessments in occupational
high risk areas, against the targeted 25% risk assessments for 2010/11.
For the development of
smallholder and subsistence farmers through access to financial services, the
Department set a baseline of 26 000 farmers (smallholder and subsistence)
for the 5-year period starting from 2010/11 until 2014/15 financial year.
However, in its Strategic Plan, the Department set itself a 10% target each
year (i.e. 2 600 farmers) which adds up to 13 000 over the 5-year
period, which is half its baseline.
Based on the 10% annual target, for the 2010/11 financial year, the
Department exceeded 2 600 for the MAFISA, CASP and Ilima/Letsema programmes.
However, the numbers do not give a clear picture as the Department is
inconsistent in its reporting. For MAFISA, it mentioned 3 910 clients and
for CASP, it mentioned 6 149 smallholder farmers but nothing on
subsistence farmers, who are also catered for under CASP. It will also assist
if the Department can give objective definitions and a clear distinction
between a smallholder and a subsistence farmer instead of boxing them in terms
of support through CASP or Ilima/Letsema.
Programme 2: Policy, Planning,
Monitoring and Evaluation
Service delivery agreements were signed by
participating Ministers and service delivery forums were established by
participating departments. The Department’s Monitoring, Evaluation and
Reporting (MER) Framework was approved by the Departmental Executive Committee
(DEXCO) and its Service Delivery Improvement Plan (SDIP) was completed and
published. The Department also initiated work on the Monitoring and Evaluation
(M & E) Framework for MAFISA, which could not be finalised due to the
departmental restructuring process.
The Department failed to approve annual M & E
plans and its M & E Plan template was put on hold pending the approval and
placement of senior management service (SMS) members to new units. One of the
Department’s challenges under this programme is other programmes that do not
adhere to reporting quarterly and annual time frames. The plan is to address
this challenge by implementing the MER Guidelines and enforcing that the Deputy
Directors-General (DDGs) ensure that programmes and sub-programmes adhere to
time frames. The Department planned to review and approve at least 3 policies
but none was reviewed, and it also failed to monitor and coordinate targeted
research and technology utilisation in the sector.
Programme
3: Economic Development, Trade and Marketing
The Department participated in numerous multilateral
agencies and meetings in the region (SADC), the continent and abroad. The
Department managed to increase the percentage of agricultural, forestry and
fisheries products that are exported to markets other than its traditional
markets, i.e. the EU and SADC, and exceeded the 37% target by 6%. However,
based on preliminary results, the Department failed to maintain the average of
65% of exports to the EU and SADC, instead, achieving 57%. The Department plans
to place more emphasis on tightening diplomatic relations with its current
trading partners. In addition, it could not increase the percentage of
agricultural, forestry and fisheries products imports from, and exports to
African countries.
The Department planned for an increased share in
agricultural, forestry and fisheries products (up to 31.8 metric tons) handled
through additional investment in storage capacity but only managed to complete
a feasibility report on the establishment of fresh produce collation and
storage facilities. The reason given by the Department is that there were no
funds to establish the storage infrastructure and the Department has submitted
funding requests for possible funding to the Land Bank, Industrial Development
Corporation (IDC) and the Development Bank of Southern Africa (DBSA). The
Department also could not get 15.6 metric tons of products from the three
sectors transported by rail but only managed to develop an agrologistics model
but no commitment from Transnet Freight Rail (TFR). In this regard,
negotiations are continuing with TFR’s executive and senior management.
For the 2010/11 financial year, the Department
planned to establish and support 3 sustainable rural cooperatives (on
agriculture, forestry and fisheries) as vehicles for local economic
development. The Department failed to achieve this deliverable but instead,
reported its assistance of 241 cooperatives to register. The Department
attributed the failure to achieve the latter to poor coordination of
cooperative functions amongst departments, provincial Departments of
Agriculture (PDAs) and other government agencies; lack of clear cooperative
development strategies from provinces and inadequate extension support inter
alia. To address the issues, the Department’s Directorate of Cooperative and
Enterprise Development will draw up a coordination strategy. The Department
also failed to facilitate access to at least 12 BEE deals to the value of R48.6
million, citing delays in the signing of the AgriBEE Fund Memorandum of
Agreement (MoA) between the Department and the Land Bank.
Programme
4: Food Security and Agrarian Reform
The Department undertook a number of national and
provincial initiatives to monitor progress and food insecurity status in the country
in partnership with SADC and the UN’s Food and Agriculture Organisation (FAO).
The Department completed drafts of the Food Security Policy and the Zero Hunger
Strategy, both of which have not been presented to Parliament or implemented.
The Department exceeded its target of monitoring
training support to 10 000 community members (who include smallholder
farmers and farm workers). Through various Sector Education Training
Authorities (SETAs), CASP, colleges and universities, the Department facilitated
training for 31 474 community members including women and youth. The
Department signed service level agreements (SLAs) with the ARC on targeted and
priority research, which will be implemented in the current financial year
(2011/12). The Department also planned to establish a Research and Technology
Fund to address resource constraints associated with long-term research.
Programme
5: Agriculture Production, Health and Food Safety
The Department planned to increase the percentage of
productive animals and animal products by 30% (baseline of 29% + 1%). The
Department reported that it has achieved the latter indicator and exceeded the
baseline by 18%. However, this is not clear as the number of animals that make
up the baseline was not given, and the Department did not provide the locations
of the projects. The Department failed to increase animal products but managed
to involve 591 dairy and goat farmers in the National Milk Recording and
Improvement Scheme. It established two feedlots in two provinces viz. one in
There is no clear indication that the Department has
managed to decrease production costs through improved efficiency of farming
systems. The Department has not achieved the target of having a partially
implemented Agricultural Production Strategy to support specific
commodities but only managed to produce
draft documents for cotton and fruit and has done consultations for other
relevant policies and legislation. To manage risks associated with diseases,
pests, natural disasters and trade, the Department planned to finalise a
Memorandum of Understanding (MoU) between the national Department, the provinces
and the Agricultural Research Council (ARC) to address phytosanitary issues in
rural areas. In this regard, the Department is still yet to submit a discussion
document for comment and approval. The Department cited lack of funds and
expertise in some areas as constraints for not achieving some of its stated
objectives.
Programme
6: Forestry and Natural Resources Management
The programme was initially called Forestry and
Resources Management in the Strategic Plan. The Department managed to address
its objectives and achieved most of its set targets for this programme, and
where stated targets were not achieved, an explanation was given. Some of the
targets that were not achieved include:
·
The expansion of commercial forest estate by afforesting
10 000 hectares in the
·
The Department fell short of creating 25 000 green
jobs, only creating 11 593 jobs. It has attributed the shortfall to poor
reporting and verification structures and processes between the national
Department and provinces.
·
The Department failed to review and develop the Agricultural
Land Protection Policy but only managed to complete Terms of Reference (ToR)
and has tasked the ARC to conduct a policy study (evidence-based).
Programme
7: Fisheries Management
The Department has changed this programme’s name from
that which is in the 2010/11 Strategic Plan, viz. Marine Fisheries and Coastal
Management. During the Department’s 4th quarter performance briefing
of the Committee, the programme was still named Marine Fisheries and Coastal
Management. No explanation has been given either for the name change or whether
the change has a bearing on the Programme’s mandate. For Fisheries, the
Department had minimal achievements in some of its targets and failed to reach
its set targets for most of its objectives citing limited human and financial
resources.
The Department for example, planned to conduct
research on finfish and scallops for aquaculture but only managed to conduct
some research on scallops. It planned to review 70% of fisheries but only
managed to do a draft survey report and 50% of the assessment. The Department
planned to investigate 75% of cases and tip-offs according to services
standards but only managed to investigate 15%. The Department planned to
implement the Transfer of Rights Policy and the Small-scale Fisheries
Policy. In this regard, two applications
were finalised and approved under the Transfer of Rights Policy and it is still
collating comments on the draft Small-scale Fisheries Policy.
5.2. Human
Resource Management
The Department has managed to reduce its vacancy rate by approximately
4% from 15% in 2009/10 to about 11% in the current financial year due to the
finalisation of its restructuring. In the 2010/11 financial
year, the Department employed 286 new staff members through appointments and
transfers, including 4 members of the SMS (Chief Financial Officer, Media
Liaison Officer, Director: Financial Administration and Director: International
Relations). In addition, a total number of 118 employees including 3 members of
the SMS (Director-General, Chief Director: Planning and Monitoring and Chief
Director: Trade and Marketing Development) were promoted to higher positions in
the Department. The Department evaluated 358 jobs resulting in the upgrading of
the salary levels of 69 posts and downgrading of the salary levels of 128 posts
(higher than the previous year’s 81).
The
Department had a staff turnover rate of 5.9% and lost the services of 375
employees (a drastic increase from the previous year’s 185), which includes 2
members of the SMS through resignations, transfers, deaths, retirements and
dismissals. The majority of employees who left the Department were in the
salary level 9-12 band (highly skilled supervision). The Department employed 9
foreign workers, namely, 1 in the skilled band, 7 in the highly skilled
supervisory band and 1 in the SMS band. The highly skilled supervision band (salary
levels 9-12), which has the highest number of vacant positions and mostly in
the sciences, also has one of the highest numbers of employees that used sick
leave after the SMS and highly skilled production bands. This is a trend from
previous years which the Department’s Human Resources Directorate has to look
into as in most cases it has nothing to do with an actual illness but workplace
stress and working conditions, or lack of internal controls as specified by the
Auditor-General.
Utilisation of Consultants
Fisheries
was the only programme that used consultants in the 2010/11 financial year. The
programme utilised approximately R3 million of its appropriated funds on 6
consultants. The activities that were done by consultants included the rights
allocation process, the catch monitoring programme (R1.1 million) and
subsistence fisheries management in KZN (R1.2 million). No historically
disadvantaged individuals (HDIs) have ownership of, or hold management
positions, in any of the 6 consultancies. In each case, only 1 HDI was
employed, possibly as a labourer. Two other projects were also carried out by
consultants using donor funds worth approximately R443 682. The same
scenario also applied in terms of ownership or employment of HDIs in these
consultancies.
5.3. Financial Information
5.3.1. Budget Overview
It should be noted that due
to the amalgamation of forestry and fisheries into agriculture, the budget
allocation for 2010/11 was done according to the programmes that existed in the
2009/10 financial year. Therefore, the programme names are different from those
that are in the 2010/11 Strategic Plan and Annual Report, as some programmes
were either merged or phased out, while some functions were added to the
Forestry Programme. This then presents a challenge in aligning the Department’s
expenditure trends within programmes and how these relate to the 2010/11
Strategic Plan, which informed the Department’s performance as presented in the
2010/11 Annual Report. Now that the Department’s amalgamation and establishment
of the new structure has been finalised, it is hoped that the Department will
be consistent and refrain from changing the names of its programmes every year.
Table 1: Total Budget
Appropriation and Expenditure
APPROPRIATIONS |
ACTUAL EXPENDITURE |
VARIANCE |
R3.9
BILLION 2010/11 |
R3.8
BILLION |
R103
MILLION |
R3.8
BILLION 2009/10 |
R3.7
BILLION |
R35
MILLION |
Source: Annual Report (DAFF),
2011
Expenditure
The Department of Agriculture, Forestry and Fisheries
was appropriated a total amount of R3.95 billion in the 2010/11 financial year,
which was slightly more than the R3.8 billion that was appropriated in the
previous financial year (see Table 2). Expenditure in the first six months of
2010/11 was R1.9 billion (47.9% of the adjusted appropriation of R3.95
billion), a slight increase of R76.2 million or 4 per cent, compared to the
R1.8 billion expenditure in the first six months of 2009/10. The main
expenditure increase compared to 2009/10 was due to increased allocations for the
ARC, Comprehensive Agricultural Support Programme (CASP) and
Ilima/Letsema.
The Department only spent 97% of its appropriated
budget in 2010/11, which is less than the 99% expenditure that it achieved in
2009/10. As a result, the Department underspent a significant amount of R103
million, which it attributed to:
·
An unpaid lease amount of R12.3 million for office
accommodation as the building was not ready for occupation at the end of the
financial year.
·
Withheld transfer payments for CASP (R33.7 million) and
Ilima/Letsema (R7.5 million) due to under-spending by some provinces.
·
An incomplete fencing project on the
·
The Department did not complete the registration of
smallholder farmers through the Farmer Register Project, thus under-spending
R19.5 million which will be rolled over to complete the project.
The unspent amounts above add up to R75.9 million and
an unspent amount of R27 million was not accounted for, yet the Department
claims it could not achieve some of its important objectives due to lack of
funds. The 2% decrease in expenditure (97% versus 99%) compared to the previous
financial year is largely due to under-expenditure in the then Programme 3, Agriculture
Support Services, which is also responsible for conditional grants (±R41
million for CASP and Ilima/Letsema that was withheld due to under-spending in
provinces). Although the Programme still constitutes the largest percentage
(44%) of the Department’s total expenditure, this is 9.6% less than 53.6% that
the programme spent in 2009/10.
Revenue
The Department estimated its
revenue for 2010/11 to be R119.3 million, a decrease from 2009/10’s R250.5
million, due to decreases in debtor accounts repayments and unspent conditional
grants refunded by provincial departments. By the end of the financial year,
unspent conditional grants refunded totalled R10.6 million compared to R113
million in 2009/10. However, revenue in respect of recovered debt and
inspection fees exceeded the estimate. As a result, the Department’s actual
revenue received amounted to R156.96 million for 2010/11. As minimal as the
returned amount is for unspent conditional grants (R10.6 million) the fact that
it seems to be a norm is worrying. Given the level of poverty and unemployment
in most provinces, the Department should be striving for 100% expenditure on
conditional grants.
5.4. Financial Reports and Risk Management
5.4.1.
Internal Auditing
The Department’s Audit
Committee highlighted that the system of internal control applied by the
Department over financial risk and risk management is not operating
effectively, efficiently or transparently. In addition, as reported in previous
years, Internal Audit is till under-resourced and cannot operate optimally in
order to address and manage risks in the absence of a reliable risk assessment
with concomitant controls identified to mitigate risks. The Audit Committee
also mentioned that certain matters that related to deficiencies in the
Department’s system of internal controls that were reported in prior years, had
not been fully and satisfactorily addressed. The Audit Committee also commented
that it had no oversight over the activities of the Fisheries Programme for the
year under review, except expenditure in respect of compensation of employees. Therefore,
it could not comment on the appropriateness and effectiveness of Fisheries
internal controls or any other matters relating thereto.
5.4.2.
Report of the Auditor-General
In terms of the financial
statements, the Department received an unqualified audit opinion from the Auditor-General
(AG), with emphasis of matter regarding the following:
- Governance: Although a risk management
strategy has been finalised, ongoing monitoring and supervision are not
undertaken to enable an assessment of the effectiveness of internal controls
over performance reporting.
In the
previous financial year, the Department had similar investigations and the
report was submitted to the Executive Authority for consideration by 31 July
2010.
5.4.3.
Details of adjustments to Estimates of National Expenditure
a. Roll-overs
The Department had roll-overs
amounting to R15.6 million from the following programmes:
b. Unforeseeable
and unavoidable expenditure
The Department received an
additional allocation of R57 million for unforeseeable and unavoidable
expenditure for the following:
- an
additional R46.9 million for drought in the Eastern and
c. Virements
and Shifts
In this section, only the
total shifts and virements with significant amounts are reported on.
Fisheries – R263.8 million
was transferred from the Department of Environmental Affairs following the
shift of the Fisheries function to DAFF.[1]
The shifting of funds was effected between all programmes and was approved
either by the National Treasury or the Department’s Chief Financial Officer
(CFO). Most of the funds from all programmes were vired from Compensation of
Employees (due to vacant posts), mostly for ICT-related activities. The largest
amount of vired funds amongst programmes was from Agriculture Support Services
Programme (R21.6 million) due to a reduction on contracts and mostly for the
Farmer Register Project. The second largest amount was from the Food Safety and
Biosecurity Programme (R17.4 million) due to vacant posts and mostly for ICT.
The total virements granted for the 2010/11 financial year were R151 million.[2]
Included
in the activities that were funded through virements was farmer compensation
for losses due to classical swine fever in the
d. Self-financing expenditure
Forestry: R51.6 million from state managed plantations,
which has been surrendered into the National Revenue Fund, will be used for
operational costs for the commercial forestry function in
6. Budget Analysis for the 2011/12 Financial Year
It should be noted that the order of programmes in
the Department’s Strategic Plan does not correspond with programmes in the
Estimates of National Expenditure (ENE). For example, Programme 2 in the
Department’s Strategic Plan is Trade Promotion and Market Access while in the
ENE, this programme is Programme 4. Therefore, the order of programmes in the
ENE was used for the Budget Analysis.
Table 2. The Department’s Budget Trends over the MTEF Period
Programme |
Budget (MTEF) |
Nominal |
Real |
Nominal % change |
Real % change |
|||
R million |
2010/11 |
2011/12 |
2012/13 |
2013/14 |
2010/11-2011/12 |
2010/11-2011/12 |
||
Administration |
1 117.6 |
1 297.0 |
1 461.0 |
1 433.1 |
179.4 |
120.0 |
16.05 |
10.74 |
Agricultural Production, Health
and Food Safety |
610.2 |
891.9 |
994.3 |
1 048.4 |
281.7 |
240.8 |
46.17 |
39.47 |
Food Security and Agrarian Reform |
1 092.0 |
1 244.2 |
1 379.7 |
1 559.0 |
152.2 |
95.2 |
13.94 |
8.72 |
Trade Promotion and Market Access |
145.6 |
191.8 |
183.4 |
193.5 |
46.2 |
37.4 |
31.73 |
25.70 |
Forestry |
755.0 |
770.7 |
902.5 |
935.7 |
15.7 |
-
19.6 |
2.08 |
-2.60 |
Fisheries |
283.5 |
324.2 |
391.2 |
333.5 |
40.7 |
25.9 |
14.36 |
9.12 |
|
|
|
|
|
|
|
|
|
TOTAL |
4 003.9 |
4 719.8 |
5 312.1 |
5 503.2 |
715.9 |
499.7 |
17.88 |
12.48 |
Source: National Treasury (2011) - Vote 26: Agriculture, Forestry and Fisheries and own
calculations.
The Department of Agriculture, Forestry and Fisheries
received an allocation of R4.7 billion in the 2011/12 financial year, which
is 0.9 per cent of the total appropriation by vote (R499.5 billion) and 0.5 per
cent of the total appropriation for the country (R888.9 billion) in the 2011/12
financial year.[3] In real terms
(inflation-adjusted), the Department’s 2011/12 budget allocation has increased
by 12.5 per cent compared to the 2010/11 financial year’s allocation of R4
billion (See Table 1 above). A significant proportion of the Department’s
budget for 2011/12 will be allocated to the Administration (27.5 per cent) and
the Food Security and Agrarian Reform (26.4 per cent) programmes, respectively,
while the Trade Promotion and Market Access will receive only 4 per cent of the
Department’s total allocation.
Over
the medium term (i.e. 2011/12, 2012/13 and 2013/14, respectively), the
Department identified efficiency savings of R33.1 million, R37.9 million and
R150.2 million across all programmes in spending on goods and services as
follows:
The
Department’s revenue is projected to increase from R119 million in 2010/11 to
R123.6 million in 2013/14, at an average rate of 1.2 percent due to revision of
tariffs. Its expenditure is projected to increase to R5.5 billion, at an
average annual rate of 11.2 per cent over the medium term. The increase over
the Medium Term Expenditure Framework (MTEF) is due to increases in the
conditional grant allocation for the CASP, Ilima/Letsema and LandCare. These
allocations increased from R1.5 billion in 2010/11 to R1.9 billion in 2013/14.
The
Department will receive additional allocations of R391.5 million, R609.3
million and R652.1 million over the medium term for the following:
The Department is also funding infrastructure
projects at a total cost of R1.2 billion, which include but not limited to:
7. Consideration of Reports of Committee on Public
Accounts
The
Department of Agriculture, Forestry and Fisheries did not appear before the
Public Accounts Committee.
8. Committee
Oversight Visits
The committee conducted joint oversight visits on the
Comprehensive Rural Development Programme (CRDP) with the Portfolio Committee
on Rural Development and Land Reform to four provinces, namely,
8.1. Summary
of the findings and recommendations
9. Committee’s Observations
·
Most of the financial and risk
management issues in the Department, in particular the lack of internal
controls and unreliability of reported performance information, have been
raised by the AG in the past three years and the Committee in the past year.
This is a very worrying trend that clearly shows that the Department simply
ignores the AG’s report and the concerns raised by Parliament.
·
Lack of monitoring and evaluation is still the Department’s biggest
challenge as evidenced by the lack of or poor performance from provinces,
through which most of the Department’s programmes are implemented. The
challenges that the Department have with provinces impede
progress in providing farmer assistance and support, thus threatening food
security. This is notwithstanding
the fact that the Department’s mission is to develop and
sustain a sector that contributes to, and embraces inter alia job creation, rural development and food security. During
the Committee’s oversight visits to land reform and agricultural projects in
provinces, it was evident that there is serious lack of planning, coordination
and intergovernmental relations within and amongst departments (including with
the Department of Rural Development and Land Reform), as well as lack of
monitoring and evaluation.
·
It seems the Department makes plans
without linking them to its budget and personnel capacity and availability. The
Department for example, did not achieve most of its planned activities and had
a number of incomplete projects in the past financial year due to lack of
financial and human resources. Some of these projects have been on-going for a
number of years, e.g. compensation of farmers for the classical swine fever
campaign.
10. Conclusion
The
Department cited the restructuring as a result of the amalgamation of Forestry
and Fisheries with Agriculture, lack of capacity and skills within the
Department, financial constraints and poor cooperation from provinces as some
of the challenges that constrained it from achieving all the targets that were
set out for the 2010/11 financial year. It has since finalised its amalgamation
and restructuring, therefore, it is hoped that poor performance will no longer
be attributed to this challenge. Otherwise, with the exception of research
which is under capacitated, it becomes difficult to advocate for a budgetary
increase for the Department as it
struggles to spend the little that it receives, and has little to show for
it. Therefore, the Committee acknowledges
and recognises that some of the challenges are a result of little research that
is being done in agriculture due to underfunding. The Department is commended for the fact that in
identifying and highlighting its challenges and constraints to meeting its
targets for each programme in the previous financial year, it has also provided
corrective measures to address the challenges.
11. Recommendations
Report to be considered.