Food security, land redistribution and restitution programmes have been cut at the knees as covid-19 induced budget cuts threatens to jeopardise the agricultural sector’s fundamental duties.
Thoko Didiza, minister of agriculture, land reform and rural development, presented her department’s adjusted budget in the National Assembly earlier this week, and the sector is struggling to come to terms with the implications thereof.
The initial February budget allocation of R16.8 billion was reduced to R14.4 billion during finance minister Tito Mboweni’s special supplementary budget in June last month.
Didiza says the greatest portion of the cuts of R1.89 billion was in the programmes which were to deliver on food security, land redistribution and restitution. The food security programme had cuts of R939 million, land redistribution and tenure reform R544 million and land restitution R403 million.
A blow for small-scale farmer development
Allocations for the Ilima-Letsema and Comprehensive Agriculture Support Programme (CASP) programmes have also been reduced. This means that in the current financial year, provinces will receive lesser allocations for producer support, production, and infrastructure.
Agri SA deputy executive director Christo van der Rheede tells Food For Mzansi they are concerned about the budget cuts. The Ilima and CASP programmes are critical for the upscaling of up-and-coming farmers.
“The CASP and Ilima systems are critical for small-scale farmers because they provide production assistance for the next season. They also assist with infrastructure development on farms where emerging farmers operate.”
Van der Rheede says the whopping R1.89 billion budget cut on food security, land redistribution and restitution programmes is another heavy blow to the sector.
“The president announced that agriculture should be prioritised as a game-changer when it comes to economic development as it creates employment and is a huge driver of food security. But these drastic budgets cuts contradict his previous sentiments.”
The agricultural leader says, though, he understands that money must be channelled towards immediate coronavirus relief and as well as welfare relief. “We need to always try to balance welfare and wealth creation because money can’t last you that long.”
He adds that South Africa needs continuous income streams that can only be generated through economic activities. “So, if the government takes away money that is critical for small-scale farmers that play a huge role in food security in deep rural areas and the former homeland areas, it is going to catch up with them eventually.”
Prioritise the Land Bank over SAA
Didiza also announced that the R100 million that was set aside for commercial farmers was affected by the challenges at the Land Bank. Van der Rheede says this will only exacerbate the Agri-bank’s financial woes. “The Land Bank is in serious financial trouble and they play a significant role in developing farmers and enabling farmers to produce food for this country.”
Van der Rheede asks, “Now my big question to the government is, ‘Don’t you think that the Land Bank should actually be assisted much more than institutions such as South African Airways? Are we really serious about land reform? Are we really serious about establishing a new co-op of black, commercial farmers? And are we really serious about food security or do we want to keep an airline that is just there to cater for the needs of the political elite?”
“A national carrier is a waste of money. We can fly much cheaper with all of the other airlines.” – CHRISTO VAN DER RHEEDE
He adds that the country’s biggest challenge remains eradicating poverty in rural areas. “You only lift people out of poverty if you invest in rural infrastructure, if you invest in rural agriculture, if you invest in rural agro-processing and also invest in exports. Just make sure people comply with the necessary standards to export to the rest of the world. That is where you will make a lot of money for your business and that will obviously have a spill-over effect on employment and higher wages.”
Dr John Purchase, chief executive of Agbiz, has mixed views about the budget cuts. He explains that budget cuts in Didiza’s department will impact the service delivery of the agricultural sector.
However, he believes it will also create the opportunity to re-establish the priorities and core functions that the department need to deliver to ensure that the sector remains competitive and contributes significantly to national and household food security.
Purchase says the cuts are understandable given the fiscal pressure government is experiencing due to a very constrained economy, amongst other factors, with zero-based budgeting being implemented for the 2021-2022 financial year.
“It will challenge the department to become far more efficient in delivery of their core functions to industry and the country. There certainly is room for considerable improvement,” he says.
Direct impact on the tourism industry
Elmarie Rabe, manager of Stellenbosch Wine Routes, tells Food For Mzansi the budgets cut also have a direct impact on the tourism industry.
“Each and every business within a tourism destination either directly or indirectly is affected by any budget cuts that provide support for our most vulnerable parts of society. It just makes sense to open tourism for us to continue to support and care for our communities. Without an income we cannot fill the gap.”