Dear Minister, Your department recently sent us into a mental tailspin, to say the least, when we were hit with letters informing us that not only would we not get long-term farm leases but that you were terminating the leases we already have, or more accurately, do not have, since you have been working on the new lease policy since 2014, and that’s a long time.
Yes, Minister [Thoko Didiza: Agriculture, Land Reform and Rural Development], five years is a long time indeed – especially for a document that is crucial in order to access finance for running a farm.
But Ms Didiza, you already know or should know that the lack of this crucial document, be it a lease or title deed, will hinder our ability to access capital, thus seriously hampering any production efforts. In fact, hampering production efforts is being diplomatic. It will make it virtually impossible. And yes I will agree with the department when it wrote that its decision was based on the “underutilisation of the property”. Just as I am sure you will agree with me that undercapitalisation will result in underutilisation.
With that said, Honourable Minister, we are relieved to have been informed by officials here at the Mpumalanga Department of Land Reform and Rural Development that they have decided to review this matter and come up with a positive way forward for all concerned. Let’s just hope this review does not take another five years.
|Minister Thoko Didiza|
Now then, Minister, I have a simple request that I am sure will resonate with my fellow emerging farmers: that this land reform programme should be looked upon with simple, plain common sense. Herewith, just a few pointers:
1) It should be accepted that most, if not all, farms allocated to beneficiaries are in need of a reasonable amount of capital injection. An official from the Land Bank in Nelspruit, while assessing the farm over which I am frustrated, estimated that on average our farms would need at least R1 million in capital injections for them to have a fighting chance at sustainable cash crop production. And that does not include your department’s Recapitalisation funding.
2) As it is already prescribed, the Department of Agriculture should be in the forefront of overseeing and, moreover, providing the necessary assistance towards production.
Unfortunately, if my local satellite agriculture office in Barberton is anything to go by, the hard-working and caring officials there find themselves all too often in the difficult position of having to say “sorry we can’t help you, there is no money to fix the communal tractor,” or “sorry we can only provide one 50kg bag of sugar beans to each of you”. (That is not even sufficient to sow one hectare.)
Where do the funds allocated to the Department of Agri disappear to? Because every so often one will read in publications such as Business Day that agriculture has had so-much of a cash injection. Again what happens to the money – whatever amount it is?
For sure that question should be posed to the Department of Agriculture, not to you guys. Then again, perhaps you are the ones who should be posing that question.
After all, they are your partners in this land reform process, are they not?
3) These farms need to be looked upon for what they are: businesses.And, as such, any assistance given should follow the widely accepted general rule of thumb that, on average, a business will take three-to-five years before it achieves sustainability, let alone makes a profit.
To think that your department’s average injection through the recap fund has been in the region of R300,000-to-R500,000 for production, which should include implements, tools and labour inputs. It was clearly insufficient for these small commercial farms, and even a gross miscalculation, based on the obvious miscalculation that success would only be achieved as of the first harvest.
Well, we know what they say when you assume: you make an **se of yourself – and of me (no disrespect intended, Minister). That is just the way it is when one goes on assumptions.
One could go on and on making various points, but doing so would venture into the area of insulting your intelligence. For crying out loud, the Deputy President himself, Mr D?D Mabuza, readily admitted to Parliament that “these farms have not been given the necessary financial support they needed and this has led to many failures”.
But hey, there is support from various corners, be it SAB, Old Mutual or the DTI, to name a few. And let’s not forget about the R1.5 billion (plus-minus) injected by the World Bank through our Land Bank. But because of your department’s five-year-long lease policy revision and now threatened termination, this support has meant nothing for most of us.
With all the above said I suppose one should, as already stated, be relieved that this matter is being reviewed. Now one hopes it is being reviewed applying common sense, common business sense. Which shouldn’t take more than an hour or two to apply.
Copyright © 2020 www.noseweek.co.za