AFASA concerned about budget reduction

The African Farmers Association of South Africa (AFASA) is concern by recently tabled Budget Vote by Minister Senzeni Zokwana of the Department of Agriculture, Forestry and Fisheries (DAFF). AFASA is concerned about the reduction of the DAFF budget as this could compromise the government’s goals of boosting the economy and creating jobs.

Mr Aggrey Mahanjana, AFASA Secretary General, said the organisation expected the agriculture budget to grow significantly due to the numerous challenges faced by the sector. This, coupled with the government’s National Development Plan objectives of creating one million jobs by 2030 to boost the economy through the sector. “The Minister’s reduced budget does not demonstrate government’s commitment to implement the NDP and grow the economy,” said Mahanjana.

Last year’s budget was R6, 383 billion compared to this year’s R6, 333 billion. Although the cut does not seem to be significant, Mahanjana said it is enough to get the farmers worried as they are expecting year-on year-growth of the agricultural budget.

“We are concerned that the budget of agriculture was reduced while farmers are still faced with the effects of drought, fuel, energy and general high input costs. We don’t understand why farmers or our sector should be punished because of other failed departments. We can’t talk of food security on one hand and on the other hand we don’t provide adequate resources for that, and we can’t expect the sector to create jobs while the support to the sector is dwindling,” Mahanjana said.

Comprehensive Agricultural Support Programme (CASP)

AFASA agrees with the Minister that CASP could play a crucial role in supporting smallholder producers who will supply their produce to the Agri-Parks across the country. However, the budget should then be used productively. The biggest problem with CASP is the lack of capacity and bureaucracy within the provincial department of agriculture’s offices. Also, the selection of beneficiaries is not always done correctly. We urge the department to improve on these, because failure to do so, would result in the collapse of this very important intervention from government. One needs to understand that the success of Agri-parks depends on primary production to feed into them. The importance of CASP can never be over emphasized.

“We believe the R1.1 billion CASP allocation to directly support farmers with infrastructure, production inputs, training and capacity building is insignificant and should be increased further to achieve these goals. With this small budget, we call on the department to prioritize and focus on projects that will create jobs and ensure food security not Projects that will ensure political gains. Radical transformation should not only be a buzz word that only ends in speeches and lip service, it must be shown through the AgriBEE commitments and resources. There must be targeted intervention for radical transformation in the agricultural sector,” he emphasized.

AFASA welcomed the Minister’s report on the increase of jobs in the sector which is reported to be 211 000 jobs created in the third quarter of 2015, the 743 increased number of smallholders and the increase of agro-processing sales by 8.4%.

Agriculture’s economic contribution

AFASA also applaud the department in its achievements in bringing underutilized land into production and other achievements the Minister reported on. According to the Minister, in the 2014/15 financial year, 136 253 hectares of land were put under production of maize, wheat, beans, vegetables and fruits among others, through CASP and Ilima/letsema. He further indicated that the department was also targeting to put 150 000 hectares for production through CASP and Ilima/Letsema in 2016/17 and R880 million is set aside for this purpose.

Together with the DTI, the Minister said his department planned to link small holder entrepreneurs with the mainstream market through the Supplier Development Programme, the Preferential Procurement Policy Framework Act and other related interventions aimed at linking small and medium size enterprises with the markets. “We have been calling for this over the years and we hope it is finalized as soon as possible.”

Drought

Although AFASA welcome the Department’s reported intervention on drought, the organization feels that the reduced budget will affect efforts of curbing the drought’s effect on smallholder farmers. “We appreciate the government’s intervention, the 224 boreholes and the distribution of about 320 000 bags of animal feed to the affected farmers,” said Mahanjana. However, he said the issue of drought goes deeper. Farmers, especially the smallholder farmers, continue to feel the effects of the drought. Earlier this year, AFASA wrote to the Minister proposing the following:

  • Farm worker salaries subsidies to avoid job losses – The farmers said because of their affected income sustaining the running cost could be difficult without having to cut on costs, which laying off workers would be top on the list. Should government consider this, it should only be applicable to farmers who have registered their farm workers with the department of labour.
  • Energy (Eskom) bills subsidies – This type of subsidy, according to the farmers, should be structured in a way that government only subsidises farmers on the fixed farm electricity costs not the usage.
  • Debt (production loans) subsidies – Farmers propose that government assist by paying off their debt for the previous season as financing production for the next season would be difficult with their current debt.
  • Making grazing available to farmers on government owned unused farms
  • Use farmers’ associations or commodity organizations as service providers for drought relief – Farmers argued that unlike service providers used currently, farmer organizations as non-profit organizations would not be escalating prices to maximise profits but would roll out the process in good faith to properly assist their fellow farmers.
  • -On a long term the government must seriously consider the implementation of a subsidised index based insurance scheme which NERPO has been calling for many years.
  • -The issue of establishing fodder banks or supporting farmers to establish the fodder banks is also highly recommended

“AFASA still maintain its position in this regard and will continue to engage with the Minister and his department in trying to ensure that farmers receive proper support as far as the drought is concerned,” concluded Mahanjana.

Author: Intsika

Gwatyu is a former editor of Farming SA and parliamentary reporter for Landbouweekblad (the leading agricultural publication in South Africa). He has more than ten years of media experience, most of which are in the agricultural sector. He completed several local and international media courses, including a media management course from the University of Stellenbosch, 3-year National Diploma in Languages (CPUT) and a fellowship in entrepreneurship on agricultural communication at the Oklahoma State University in 2014. He continues to be involved in agricultural media and communication activities in South Africa and the continent.

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