Speech Notes: Rural Development and Agrarian Reform Portfolio Committee Report and Budget 2020/2021

Issued by Retief Odendaal, MPL
Shadow MEC for Rural Development and Agrarian Reform

Speaker, as the province is still fighting the scourge of the COVID-19 pandemic, I think everyone in this house will agree with me that the farmers of the Eastern Cape, both commercial and emerging, have done sterling work in ensuring food security amidst this very trying time. I want to personally thank each and every one of them for their commitment to the wellbeing of the people of the Eastern Cape.

This yet again proves that the agricultural industry truly is the foundation of a developing country and why it is so important to create an environment in which our farmers can prosper.

Considering the aforesaid, we have to ask ourselves whether this provincial government and more specifically DRDAR, is providing adequate support to the agricultural industry in order to create an enabling environment for farmers.

Provincial Treasury has already indicated that the agricultural industry in the province is set to decline by some 4,4% during the year at hand, thus indicating that even our farmers will not escape the scourge of COVID-19.

When considering the budget before us today we have to ask ourselves whether this budget will thus support and enable the industry to grow and develop.

The fact that the department will be budgeting to spend close to 56% of its entire budget on the cost of employment should be a cause for great concern. Whilst our staffing costs continues to rise, our budget for goods and service for our core business operations is getting smaller. This year the budget for goods and services is being reduced by a whopping 19.7%. This does not bode well for our business operations and is a very concerning trend. As cost of employment continues to rise, eventually there will be no more money for our core business.

Against this backdrop one has to acknowledge upfront that there is an urgent need to review the organogram of the department. This is a fact that is highlighted by the committee report.

In order to create an enabling environment for farmers, Speaker, DRDAR must become far more responsive towards the needs of our farmers in the province. If we look at the recent response of the department towards the crippling drought that the Eastern Cape is experiencing, the department was certainly found wanting. The chaotic means by which drought relief was procured and distributed was unacceptable, and in certain regions really frustrated our farmers.

In this regard having perused some of the procurement documentation as well as the distribution list, I want to request the MEC to institute an audit in respect of the drought aid that was distributed in the province. There has certainly been a number of discrepancies that would warrant such an audit.

The province certainly did not get value for money from many of the service providers from which lucerne and grass were procured and in certain instances paid up to four times the going rate for such feed.

This is totally unacceptable and must force us to revaluate how we support farmers during such drought stricken times. In this regard I want to also suggest that we introduce a coupon system for drought relief in future, similar to the one that has been previously successfully utilised in the Sarah Baartman district as well as the Western Cape.

In certain regions within the Saarah Baartman district, farmers are still grappling with this ongoing, crippling drought and the department has done nothing in recent months to assist these farmers. The drought is certainly far from over and the budget before us unfortunately does not seek to provide support to these long suffering farmers.

Whilst on the subject of the protracted drought in Sarah Baartman, the department has also been non-responsive to the disaster currently unfolding in the Gamtoos Valley. The Department of Water and Sanitation has cut the normal water allocation for agricultural use from the Kouga Dam by 80% as from 1 July 2020. These severe water restrictions will decimate farmers in the region as the significantly reduced water allocation that farmers are now receiving will not be sufficient to keep their orchards alive over the coming months.

These farmers are some of the biggest producers of citrus fruit in the country, and citrus exports from this area is a significant contributor to the provincial GDP.

Thousands of hectares of citrus could be affected, which will have a devastating impact on jobs in the region. This will cause untold hardship for people who are already battling in the current economic climate.

I have written to the Honourable Meth and requested her to intervene in this looming crisis and as such reiterate my plea for assistance to these farmers.

Speaker, the state of local government in rural Eastern Cape is fast becoming a threat to the agricultural industry as support industries are increasingly leaving our rural towns and districts because of the dysfunctionality of municipalities.

Speaker, last year I raised concern that this department has neglected its key mandate of rural development. Those same concerns remains valid today as there continues to be no meaningful policy creation or joined developmental planning between DRDAR and other provincial departments, local governments or national entities such as SANRAL in order to facilitate future development in rural Eastern Cape. The budget before us once again bears testimony to this fact.

The Democratic Alliance agrees with the committee report that the department can no longer afford to fund our two Agricultural Colleges. These colleges remains an unaffordable albatross around the neck of the provincial government and I would urge the Honourable Premier to personally start engaging with the Minister for Higher Education, Science and Education in bid to have these facilitates transferred to the national department in the very  near future.

Whilst we are on the subject matter of Provincial Entities, we simply have to find a way of ensuring that our entities are being run far more efficiently. In this regard, the portfolio committee will have no choice but to start vigorously interrogating the different projects and functions of its entities.

In this regard I specifically want to caution the House that the Agricultural Loans issued by the ECRDA is cause for concern. It recently came to light that an amount of R28.6 million in respect of irrecoverable loan funding has been written-off by this entity over the last number of years.

Even more concerning however is the fact that the repayment rate of these loans have been on average only 75.5% over the last decade. This will likely mean that tens of millions of Rands in irrecoverably loan funding will still have to be written-off by the ECDRA in coming years. This type of wasteful expenditure is just adding to the departments’ financial woes and has to be stopped forthwith.

In addition, there should also be cause for concern that our entities are not managing projects as well as they should. A visit to the Mbizana Red Hub earlier this year highlighted how dwindling crop yields over the last number of years have negatively affected the operations at this facility. Whilst the concept is absolutely brilliant, the project is limping along because of inadequate management by the ECRDA. It should be a cause of concern that the ECRDA does not readily solicit the advice or involvement of experts to assist them in the management of these facilities and projects. We see  similar problems at most of our Red Hubs

The viability of the Magwa and Majola Tea plantations remains a cause for huge concern as these projects continue to bleed money without any viability within the foreseeable future. In this regard I want to make it very clear that the department still does not have a workable solution for these plantations. We are failing the people of Magwa and Majola because we are unable to find solutions to the problem. These projects are doomed to fail if we don’t find credible solutions and workable, funded turnaround plans very soon. Just merely throwing money at the problem is also not going to resolve the myriad of problems these projects are faced with.

Speaker, creating an enabling environment for farmers must be our number one objective within the department. Farming is a passion, a way of life, not just a way of making a living. If we create a conducive environment for our farmers to prosper and to lead a value life, there are certainly plenty of opportunities in this sector for growth and job creation.

Sadly, the budget before us will do little to create that enabling environment. The Democratic Alliance does not support Vote 8 in its current format.

I thank you.