PRESENTATION TO SELECT COMMITTEE ON FINANCE COMMENTS ON THE FFC RECOMMENDATIONS ON THE DIVISION OF REVENUE 2010/11 Prepared By: Acting-Director General Department of Agriculture, Forestry & Fisheries PRETORIA, 0001 DATE: 07 AUGUST 2009

PRESENTATION OUTLINE Department of Agriculture, Forestry and Fisheries (DAFF) Conditional Grants Comments on FFC DORA Review Grants MTEF budgets DAFF proposal and Consolidation of Conditional Grants Conclusion

DAFF CONDITIONAL GRANTS The Department of Agriculture, Forestry and Fisheries has three conditional Grants, namely: 1. Comprehensive Agriculture Support Programme (CASP) DORA Schedule 4 Conditional Grant Post Settlement support 2. LandCare DORA Schedule 5 Conditional Grant National Resources Management 3 ILima/Letsema Mechanisation and Production inputs 4. Disasters

Grants Objectives To enhance Long-term sustainability and economic viability To enhance national and household food security To preserve and manage our natural resources To generate employment opportunities To Improve farming efficiency and To reduce poverty.

SADC POSITION AND GOVERNMENT PRIORITIES Maputo Declaration: Governments have committed themselves to allocate at least 10% of their national budgets to agriculture: This objective in SA has not been reached yet; the status quo is: 2005/06 – 2006/07 = 3% 2007/08 – 2208/09 = 2% South African Government Priorities, a framework to achieve this: Creating Decent Work and Sustainable Livelihoods Health Education Crime Rural Development, Food Security and Land Reform

Comments on the Provincial Equitable Share (PES) Review We welcome the recommendations by FFC: Which ever option is taken (short/long term solution), the department shall be happy if the following are considered by the review; In provinces the amount of equitable share going to agriculture has not been growing: It is envisaged that this review will look at this and change the status quo. The sector has been funding provincial mandates using conditional grants Even though DORA deals with natural disasters in- year, the sector would like to propose a review that incorporates the fund onto the equitable share.

Comments in respect of public Infrastructure investments The DAFF welcomes the recommendation to increase the quantum of investments in public infrastructure and agrees that planning is critical We agree with the commission that increased infrastructure funding should be linked to basic services like water, health, agriculture, transport, in particular agro-logistics in our case. We would insist that our infrastructure grants in CASP and LandCare be increased to respond to infrastructure needs of emerging farmers. Baselines of agriculture in provinces are not improving, therefore CASP is not supplementing The idea of an infrastructure maintenance strategy is supported as this will ensure sustainable jobs through our EPWP linked conditional grants

Comments with respect to Social Assistance Grants A recommendation to increase social grants during this economic downturn is welcomed A need for coordination: Linking social grants to food production starter packs could be a long term sustainable solution to these grants. Grants like CASP and EPWP linked support in Agriculture contributes enormously in cushioning the poor from increasing food prices. Increased food production at local centers could reduce the risk of entitlement/dependency. Increasing food production through agriculture funding would lead to a number of benefits that accrue to rural development.

CASP MTEF ALLOCATION 2009/10 TO 2011/12 Province Column A Column B 2009/10 Allocation Forward Estimates   2010/11 2011/12 R'000 Eastern Cape 120 364 145 092 166 958 Free State 65 659 79 149 88 894 Gauteng 33 844 40 797 43 965 KwaZulu-Natal 117 761 141 954 160 176 Limpopo 108 483 130 770 148 124 Mpumalanga 70 892 85 456 95 691 Northern Cape 49 232 59 346 63 954 North West 91 518 110 319 129 485 Western Cape 57 640 69 481 78 476 Unallocated - 3 600 TOTAL 715 394 862 365 979 321

LANDCARE MTEF ALLOCATIONS 2009/10 TO 2011/12 Province Column A Column B 2009/10 Allocation Forward Estimates   2010/11 2011/12 R'000 Eastern Cape 8 227 8 721 9 244 Free State 4 113 4 360 4 622 Gauteng 3 599 3 815 4 044 KwaZulu-Natal Limpopo 7 713 8 176 8 667 Mpumalanga 4 627 4 904 5 198 Northern Cape 5 656 5 995 6 355 North West 6 170 6 540 6 932 Western Cape 3 085 3 270 3 466 TOTAL 51 417 54 502 57 772

CONSOLIDATING CONDITIONAL GRANTS In line with previous recommendations the department is consolidating all its grants into a single one, CASP, as a Schedule 5 Grant of DORA in line with; FFC of 1996 review and concerns on the proliferation of conditional grants To ensure bigger and longer term impacting conditional grants, like infrastructure Improved monitoring and oversight. See illustration below of a single one stop grant

SINGLE COMPREHENSIVE SUPPORT SERVICES GRANT

CONDITIIONAL GRANTS MTEF 2009 to 2011 YEAR CASP LANDCARE ILIMA/LETSIMA TOTAL 2009/10 715 51 50 816million 2010/11 862 54 200 1,1billion 2011/12 979 57 400 1.4 billion 2.5 billion 162 million 650 million 3.3 billion CASP include Extension Recovery Fund

THANK YOU! SIYABONGA! REALEBOGA! HA KHENSA! BAIE DANKIE! SIYABULELA!