Stormy weather ahead

South Africa’s troubled land reform programme and the plight of black farmers are again headed for rough waters. A renewed confrontation between black farmers and the government threatens when the farmers meet with African National Congress general-secretary Gwede Mantashe on 19 November with a demand for a complete overall of the way their sector is funded. In the interim, small farmers could play an important role in securing South Africa's future food security in the face of climate change.

In another blow to developments on the land reform front, the North Gauteng High Court has declared key sections of an important land reform law, the Communal Land Rights Act, as being unconstitutional – thus making it unworkable.

The demands of the black farmers follow the announcement last week by Finance Minister Pravin Gordhan that the first R1 billion of the Land Bank’s R3.5-billion recapitalisation would be released in this financial year.

When the black farming groups meet Mantashe later this month they will make, among other things, recommendations on how to reduce high land prices which they say leave them over-indebted to the Land Bank.

Apart from high land prices in the general market which affect all farmers, high land prices asked by white farmers for their land in the restitution process have also long been held up as a major issue hobbling the land restitution process, leading to growing political discontent.

High costs and lack of sustained government support (in funding, provision of implements and training) has been cited widely as the greatest contributing factors to the high failure rate among new black farmers benefitting from the land restitution process.

In June, Gordhan approved the R3.5-billion recapitalisation after the Treasury approved the bank’s turnaround strategy. This included lifting the moratorium on foreclosing on defaulting black farmers, strengthening collections on non-performing loans, and freezing payouts from a R100-million AgriBEE fund that is currently under investigation by the police. The Departments of Land Reform and Agriculture also funded bailout packages for 283 defaulting black farmers who owed the Land Bank R232m.

Of the recapitalisation funds, a total of R3.2bn was earmarked for development loans in support of black farmers and agricultural enterprises that contribute to land reform targets, create jobs and support empowerment.

However, the black farming groups have reiterated their long-held belief that the current state-sponsored funding mechanisms are setting up new black farmers for failure. They will be demanding the scrapping of the current grant system and demanding an entirely new government farmer support system when they meet Mantashe.

Meanwhile, the challenge to the Communal Land Rights Act on which the North Gauteng High Court ruled on Friday, was launched by the Legal Resources Centre (LRC) and the firm, Webber Wentzel, on behalf of four communities in the provinces of Limpopo, Mpumalanga and the North West.

The court’s ruling is likely to impact seriously on government plans to reform the system of land tenure for some 21 million people currently living on 16 million hectares of communal land, most of it located in former homelands.

It is also likely to impact negatively on the government’s key Comprehensive Rural Development Programme (CRDP), launched by President Jacob Zuma in August. In terms of the CRDP, the implementation of the Communal Land Rights Act was to facilitate economic growth in communal areas by converting communally held land into freehold tenure. Now all of this could be on hold, further exacerbating frustrations in rural areas and in the land reform sphere.

Pressures have been building up in this sector for a long time alongside the known and rising pressures around land reform, and will warrant innovative and urgent attention from the government.

The tensions are also being exacerbated by the recession and global economic situation, high operating costs, as well as climatic and weather impacts and the anticipated rocketing energy costs in the face of oil peak.

The international Food and Agriculture Organization estimates that food production will be required to double by 2050 in order to keep up with increasing demand. At a meeting of the G8, representing the world’s largest economies, held during July in Italy, a statement declared that there is urgent need for decisive action to free mankind from hunger and singled out agriculture for massive attention and support.

Across the globe, there is a shift towards more aid and investment in agriculture in attempts to boost food security and effect rural development. It is against this background that President Zuma’s CRDP should be judged.