Minister Alan Winde delivers 2017/18 Agriculture Budget Speech
Cabinet colleagues and Members of the Provincial Legislature,
Director-General and Heads of Departments,
Our partners in business, civil society and labour,
Citizens of the Western Cape,
The media, and
And most importantly, the residents of our province who work in and drive our agricultural sector
I have the pleasure of addressing you at a crucial time for agriculture, when its importance at home, and across the world, is growing in recognition.
Globally, this sector is emerging as part of the solution to poverty and inequality.
In September 2015, leaders from 193 countries ratified this view by making agriculture one of the cornerstones of the 2030 Agenda for Sustainable Development. Sustainable Development Goal 2 includes a call to action to “End hunger, achieve food security and improved nutrition, and promote sustainable agriculture”.
As the world’s population is expected to grow rapidly, securing our food supply and protecting the environment is high on the international agenda.
According to the UN, agricultural production must increase by 60 percent to meet the demand of the nine billion people who are expected to live on earth by 2050.
The Western Cape is poised to play a vital role in meeting this challenge.
In the province, the Gross Value Add (GVA) of agriculture, an indicator of all the goods and services produced by the sector, amounts to R18.6 billion, with export revenue generating R40 billion per annum.
Vitally, it supports employment for a large number of residents in our province, who make a living from tending the over 11.5 million hectares of land reserved for agriculture in the Western Cape.
And while our land resources amount to just 12.4 percent of South Africa’s total available agricultural land, we produce between 50 and 60 percent of our country’s agricultural exports.
Noting the ability of agriculture and agri-processing to dramatically accelerate growth and jobs in our province, in 2014, as part of our economic strategy, we gave them priority sector status. As part of Project Khulisa, we worked in close collaboration with the private sector to define a set of action plans to maximize our competitive potential in these areas.
Our findings showed us that we could add up to 100 000 jobs to the agri-processing sector, mostly in rural communities across the Western Cape.
When we embarked on Project Khulisa in 2014, 320 000 people were employed in agriculture and agri-processing.
Today, just over 448 000 people work in these sectors - an increase of 40 percent. More than 127 000 people have benefitted from this surge in job creation. These numbers demonstrate that demand led interventions, which are responsive to industry needs, work.
We’ve also made significant strides in enabling established and emerging farmers to export their produce. Last year, we established a dedicated Veterinary Export Certification Office which provides around-the-clock assistance to exporters requiring permits to ship their goods across our borders.
The officials who work in this office understand that they are doing important work in helping us to grow our economy and create jobs. They don't keep traditional office hours. They take the lead from the private sector and tailor their operations to meet the schedules of business. It is because of this approach that they were able to process over 15 000 permits in 2016, resulting in the shipment of R1.8 billion worth of goods from our region.
We’re making good progress in achieving Project Khulisa’s goal of increasing exports to strategic destinations. As part of our commitment to transformation in the sector, we’ve prioritised working with black businesses to ensure they have the certification they need to sell to international markets. Since 2014, we have supported 52 exporters to enter new markets across the globe, through various programmes.
This means that fresh Cape apples are sold in the fresh produce markets of Nairobi, Cape grapes in chain stores across the United Kingdom, and our oranges in supermarkets on the east coast of America. With every piece of fresh or processed produce sold, income is generated for locals back home. The volume of South African wine sales increased by seven million litres between 2014 and 2016, reaching 15.8 million litres last year.
But the real story of how agriculture changes lives lies behind the numbers.
Last year, Rizia Bassa of Bassalicious food sauces received funding to join us at a trade show in China. Rizia landed a contract with a Chinese bakery chain which will result in a container of Bassalicious sauces, worth R1.4 million, being exported every second month. She was also awarded a five-year contract by the distributor to supply major fast food chains in China.
Rizia is here today and I would like to say thank you for adding to the growth of our economy, and for creating jobs for local residents.
Global trends have shown an increase in the demand for high-quality produce. Here at home, agriculture is playing a role is making sure particularly vulnerable households also have access to nutritious food. In pursuit of ensuring all of our residents are food secure, since 2014 we have given 4 000 families the tools they need to create thriving community-based food gardens from which to produce their own food. In the coming year, we’ll help a further 1000 families to join this programme.
I would like to acknowledge Mathilda Frans of the Louwskloof Organic Vegetables project in Mamre. Mathilda and her team were concerned about the high levels of food insecurity in their area, and approached us for support with the establishment of a food garden. That was in 2015. Today they produce enough food for their households and sell surplus produce direct to their local community. Since logistical costs are not a factor, her goods are fresher, and she is able to keep her prices low.
We also have Henry Arendse in the House with us, representing the Arendse family from Jamestown. Through hard work and dedication, this family now produces more than enough for their own needs. They sell their surplus produce through formal food chains, such as Farm Fresh and Nutripick.
Innovative and hard-working residents like Mathilda and the Arendse family have embraced agriculture to boost our food supply, and have changed their futures forever. Its stories like these that I’d like to see more of.
Indeed, economic opportunities in this sector should be accessible to all residents who are willing to work for them. That is why accelerating the pace of transformation in this sector is one of my most pressing priorities. In the past year, we’ve helped over 4 000 emerging farmers to build agricultural enterprises.
One of the beneficiaries of our farmer support programme is Teshwin Toto, a young farmer from the Central Karoo who has joined us here today. At just 22 years old, Teshwin started farming with 30 sheep on commonage land near Beaufort West. Seven years later, he is farming 400 sheep on Vaalkuil farm. He employs three people, and an additional ten residents during shearing time.
We’ve already accomplished so much, and with this budget allocation, we will ensure we do more.
But, there is another side too, which is placing at risk the entirety of this sector.
Administrations across the world recognise climate change as one of the biggest risks facing development.
The leadership of the UN recently advanced that climate change is development’s “single biggest threat”, and urged global action, through Sustainable Development Goal 13, which reads: “Take urgent action to combat climate change and its impacts”.
In 2015, South Africa recorded its lowest rainfall in a calendar year since 1904. In the same year, the highest ever temperature recorded on earth, 48.3 degrees celsius, was measured at Vredendal.
In the past two years, drought and high temperatures, as well as floods and hail, have led to significant losses in agriculture.
The loss of 200 000 tonnes of wheat due to insufficient rain during the 2015 winter;
A 15 percent decrease in fruit production in 2015/16 worth an estimated loss of R750 million;
The loss of 230 hectares of potatoes, which could not be planted due to the lack of water;
In livestock, we estimate that in excess of 30 000 animals have been sold as farmers battle to feed their core herds;
A decline of 5 percent in the wine grapes harvested during 2016 due to high temperatures and lack of irrigation water. In rand terms, this loss amounted to an estimated R500 million.
As a further result of the water restrictions, our agricultural economists are projecting a R112 million decrease in GVA, and a possible drop of 1 728 in the number of available seasonal work opportunities.
I have witnessed first-hand the very real effects of this crisis. Our emerging farmers especially, are struggling to survive through this time of higher input costs. We realised early on that if we did not take decisive action, families living in rural communities across the province would be plunged further into poverty. We could not wait for lengthy national processes to kick in in order to assist these farmers, so we made a plan with provincial resources.
As a start, we allocated R48 million for drought relief support. The funds were used for a monthly livelihood support package to emerging grain farmers and their staff, and for animal fodder. Support was also granted to grain farmers to buy inputs, such as seed, fertilisers and fuel to plant the winter crop in 2016. These farmers had a particularly difficult year after losing their crop last year due to the drought.
Last week I met with farmers who are struggling under the strain of this prolonged drought. Along the West Coast, I sat down with Whernit Dirks, who co-owns the Genadeshoop Boerdery. Last year production fell as a consequence of the drought. There was a very real chance they would have to close their doors. Thanks to excellent management, sustainable farming practices and drought relief from this department, worth just under R4 million, they turned their operations around. I’d like to welcome Whernit here today.
With the emergency drought package we approved, a number of emerging farmers were afforded the lifeline they needed to continue operating. In the year ahead, R47 million will be set aside for drought relief.
Projections show that in the years to come, the climate change crisis will likely deepen. Winter rainfall across most of the Western Cape will decline, but in other areas, heavier rainfall and floods will rise. Heatwaves will become more common. Droughts will increase in frequency. Strong winds and unseasonal cold snaps are among the risks we face in the not-too-distant future.
In partnership with the private sector, we are arming ourselves against these threats through our long-term coordinated strategy, the SmartAgri Climate Change Response Plan. SmartAgri sets out detailed scenarios and response proposals for each region and sector in our province.
Part of the SmartAgri approach to mitigate the danger posed by climate change is conservation agriculture. This method of farming includes minimum tillage, year-round soil cover and crop rotation to maintain the soil’s natural structure and increase the level of nutrients able to be absorbed. We’ve taken this message to farmers across the province in the past two years. And what we’re seeing is an unprecedented shift to this more sustainable form of farming.
Abri Richter, who is farming at the Panorama farm in Pools, has joined us today. Abri is a champion for conservation farming. His farm is located in a low rainfall area, and despite receiving less than 180 millimetres of rain in 2015 and 2016, he managed to conduct his harvest, thanks to conservation agriculture. Thank you, Abri, for serving as an inspiration to the sector.
It is clear that responsible practices such as conservation agriculture are going a long way toward securing food production levels in our province. I am proud to say that together, we are building a more productive and more resilient agriculture sector for the generations which will follow us, and to meet the needs of a growing population. In this same way, we know that helping our young people reach their full potential is their key to a prosperous future.
Since 2009, we have funded skills programmes worth more than R30 million, primarily targeting black students and residents living in rural areas.
This brings me to a very exciting announcement.
I’m pleased to welcome the future of our agriculture sector here today.
Vanessa Barends, from Bredasdorp, started an internship with the Provincial Department of Agriculture after matriculating from Napier High School in 2005.
She then obtained a bursary to study a Business Science degree in Agricultural Economics at Stellenbosch University. Once she completed her degree, Vanessa enrolled in the department’s Young Professional Persons Programme. This programme is aimed at supporting black post-graduate students to develop their careers, with a focus on women. Participants are mentored and receive in-service training.
Vanessa completed her master’s degree, with her dissertation focused on the carbon footprint of farming activities. She developed a calculator which will help small- and medium-sized farming operations to determine their carbon footprint on the environment. During her internship, she started work with the Department’s own research farms to prepare them for the likely implementation of carbon tax. Today Vanessa is employed as an agricultural economist with the Western Cape Department of Agriculture.
The children of agri workers are a special focus for our department.
Through the Agricultural Partnership for Youth Development Project, we are increasing opportunities for the children of agri workers to fulfil their potential.
Today, we have Brayn Stephens joining us. Brayn was raised by his grandmother, Elizabeth Abrahams, who is a pensioner. He received a scholarship from us to complete Grades 11 and 12 at the Augsburg Agricultural College in Clanwilliam. Brayn is currently registered for the Higher Certificate at Elsenburg College and is a bursary holder of our youth development project. He is passionate about farming and dreams of becoming a successful commercial farmer. We are walking with Brayn, who is working very hard, to make his dreams a reality.
I’d also like to welcome Macniel Koopman, a young man from Saron who was raised by his grandparents, Michael and Noreen Koopman. Macniel completed his matric in 2009 and then worked as a seasonal worker on numerous farms in his local area. In 2015, he applied to the APFYD internship project, and is currently enrolled for the Higher Certificate at Elsenburg College. His intention is to focus on developing Saron to improve the lives of residents there.
Both Brayn and Macneil have written their soil science exams this morning, shortly before joining us. I hope it went very well, and I wish you the best with the remainder of your academic year.
We know that when we invest in rural communities, we are investing in the men and women who are going to take agriculture forward. We know that when they become self-sufficient, rural families have the economic freedom and the wherewithal to build better lives for their children. These men and women are our partners in responding to the world’s rising demand for food.
Between 2010 and 2016, just under 14 000 residents, mainly agri-workers and small-holder farmers, completed a range of short skills courses offered through Elsenburg College, including key curricula in agri-processing.
We’ve also reached just over 87 000 residents in our rural areas through targeted programmes aimed at enabling them to strengthen their communities. These included substance abuse prevention interventions, and early childhood development programmes.
To celebrate the work of our agricultural employees, we also host the 2016 Prestige Agri Worker of the Year, and I would like welcome the winner of last year’s awards, Anton Alexander, here today. Thank you, Anton, for working with us to grow agriculture in the Western Cape, and for making this sector proud.
To better understand residents’ needs, we’re visiting rural communities across the Western Cape as part of our ongoing Agri Worker Household Census. So far, we’ve already engaged with 11 000 families. The full report will be complete by the end of this month. We will share the insights we’ve gained with provincial government departments to make sure that projects across the government are responding to the specific challenges faced by rural communities.
While we are making some progress, we must do more. Last year, I was made aware of unfair treatment of workers at wine farms in the Western Cape. We immediately approached the Department of Labour to investigate the cases, and our own officials accompanied the national government to these farms.
Even one case is one too many.
Ten farms were investigated, and the Department of Labour, in line with their mandate of ensuring the rights of agri workers, issued contravention notices where required. In tandem, further discussions have taken place with the ethical trade associations to put together a plan to root out these practices wherever the occur.
I believe building a strong agriculture sector, one we can all be proud of, rests on partnerships. Government cannot do it alone. We must bring together all stakeholders with a shared commitment.
Much of the good work we’ve done has been led by Joyene Isaacs, the Head of Agriculture, and her team, who have joined us in the House today.
In the 2017/18 financial year, the Western Cape Department of Agriculture will receive R797 million to continue delivering services to farmers and agri workers in our province, divided as follows:
To provide leadership services, Programme 1: Administration, receives R130.842 million.
Programme 2: Sustainable Resource Management, receives R86.083 million to work with farmers to manage our natural resources. In 2017/18, the team has set itself the target of rehabilitating 3 000 hectares of land which can be used for agricultural production.
To drive transformation in Western Cape agriculture, Programme 3: Farmer Support and Development, will receive R265.355 million. More than 4 000 farmers will be supported in the year ahead.
Programme 4: Veterinary Services, is allocated R91.141 million to keep our animal population disease free, and to increase market access for our meat exports.
To ensure that our province is harnessing the power of technology and innovation, Programme 5: Research Technology and Development Services, receives R115.915 million. I have been extremely impressed by the work of this unit, which has brought new technologies into this space, of which are ahead of global trends, and have offered them to farmers for no charge.
Programme 6: Agricultural Economics Services, receives R24.286 million to deliver expert economic advice to more than 2 000 entrepreneurs.
Programme 7: Structured Agricultural Education and Training is allocated R58.968 to develop agriculture’s brightest young minds.
Programme 8: Rural Development receives R22.589 million to continue supporting rural households across the province.
With these allocations, we will continue to grow agriculture in the year ahead, so that our sector here at the Southern tip of Africa becomes a key player in not only growing our economy and creating jobs in our region, and also in feeding the world.
To keep the agriculture sector fresh in your mind, every member of this House receives tickets to the SA Cheese Festival, courtesy of Agri Expo.
I thank you.