Last week Farmer’s Weekly exposed how the Eastern Cape’s Massive Food Programme degenerated into large-scale looting of the public purse. Now the province’s agriculture department has circulated a candid report among its managers on the scheme’s shortcomings and how efforts to fix them are bearing fruit. But as Stephan Hofstätter reports, dodgy contractors are trying to derail the reform drive as it makes it harder for them to rip off government.
The Eastern Cape’s Massive Food Programme (MFP) has been designed to make the fertile province self-sufficient in staples and stimulate commercial agriculture in communal areas. Instead it turned into a free-for-all with farmers, officials, input suppliers and contract ploughers colluding to defraud government. A sample field audit in 2005 of random projects revealed widespread abuses, including corrupt officials earmarking land that didn’t meet qualifying criteria as eligible for funding, input suppliers being paid for goods never delivered, and tractor cartels using violence to maintain a stranglehold on lucrative state-funded ploughing and planting contracts. Senior managers presented the audit’s results at workshops attended by district officials and service providers, and a series of reforms were introduced that are already bearing fruit.
Unpacking reforms that work
First, a new conditional grant was introduced that allowed farmers with land units as small as 1ha to participate. Previously, communal farmers had to pool their small land parcels to reach a single unit of 50ha. This system, called Siyakhula, qualifies farmers for a 100% input grant for the first season. To be eligible for a 75% grant in the second season they must pay a deposit based on 25% of the proceeds of the first season’s crop. The deposit, most of which becomes available to the farmers to finance inputs, increases to 50% and 75% in the third and fourth years and is phased out in the fifth. I ndividual farmers with cropping units of at least 50ha are paid a 100% input grant in the first season and are eligible for a 25% grant for another two seasons provided a deposit based on 75% of the value of the crop is paid. Deposits are linked to the current market price of a crop and not the value of inputs received. S econd, the scheme’s technical support component was improved by introducing commercial farmers as mentors. Qualifying criteria included being independent of ploughing and planting contractors, input suppliers or providers of any agricultural services or goods. Mentor performance is judged on yields alone, and contracts reviewed annually. Top performers are rewarded with bonuses and laggards don’t have their contracts renewed. n a candid admission that its own technical support staff had failed farmers, the department stated in a confidential memo circulated to managers last month that most extension officers have little experience of the level of production management skills needed to ensure commercial viability of farming projects. The memo, leaked to Farmer’s Weekly, insists the need to introduce sound commercial farming practices was too urgent to wait until sufficient capacity and experience was built up in the department. It demanded immediate adherence to proper agricultural practices. n the first two years in operation the scheme achieved average maize yields of 1t/ha on well-watered, high-potential soils. Yields in the first season after the audit tripled to 3t/ha, and this year they are expected to reach 4,5 to 5t/ha. This represents a massive leap in value for money for the taxpayer-funded food production subsidy. In the first two years a R91-million subsidy produced 26 000t of maize – about 75% of what would have been available if maize had been bought and distributed. After the reforms, this figure jumped to 198% and this season to 218%, using prevailing Safex prices on which to base calculations. “This meant that in the order of twice as much value in terms of strict food security was generated through the agricultural processes of the project than was possible by procuring maize from elsewhere,” the report found. This turnaround was attributed “in the most part to the attention given to adherence to proper agricultural practice”, the report says. “The introduction of mentors is seen to have been the single most important contributing factor to this,” it concludes.
Separating the cream from the crooked
The reforms have entailed kicking out 25% of the worst-performing farmers, weeding out contractors defaulting on loan repayments or not meeting qualifying criteria, repossessing equipment to recoup losses, and urging farmers to source inputs from the most competitive suppliers. Government sources have warned this has led to a backlash from unscrupulous tractor contractors and input suppliers who see their scope to rip off government being curtailed. “These people are lobbying the MEC [of agriculture, Gugile Nkwinti] to ensure their orders are pushed through and trying to get mentors removed when they encourage farmers to source cheap inputs,” says one official. This is indirectly confirmed by the report, which states, “decisions in favour of maximum gross margins” are likely to be challenged by operators losing business to competitors. Apparently referring to lobbying by contractors and suppliers, the report warns the department to expect “allegations of unfair business practice”, but urges officials not to act on these unless supported by substantive evidence. t remains to be seen if these warnings will be heeded, and the MFP be allowed to consolidate its successes and become a model for other impoverished regions rich in agricultural potential, or whether political expedience will erode these gains. |fw
