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DAFF ANNUAL REPORT 2010/11: PERFORMANCE INFORMATION PowerPoint Presentation
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DAFF ANNUAL REPORT 2010/11: PERFORMANCE INFORMATION

DAFF ANNUAL REPORT 2010/11: PERFORMANCE INFORMATION

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DAFF ANNUAL REPORT 2010/11: PERFORMANCE INFORMATION

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  1. DAFF ANNUAL REPORT 2010/11: PERFORMANCE INFORMATION DIRECTOR – GENERAL Mr Langa Zita 11 OCTOBER 2011

  2. PRESENTATION OUTLINE 1. Mandate, Vision and Strategic Goals 2. Overview 3. Sectoral Economic Environment 4. Programme 1: Administration 5. Programme 2: Policy, Planning, Monitoring and Evaluation 6. Programme 3: Economic Development, Trade and Marketing 7. Programme 4: Food Security and Agrarian Reform 8. Programme 5: Agriculture Production, Health and Food Safety 9. Programme 6: Forestry and Natural Resources Management 10. Programme 7: Fisheries Management 13. Financial Statements 14. Way Forward

  3. VISION AND STRATEGIC GOALS OF DAFF VISION The vision of the department is a leading, dynamic,united, prosperous and people-centred sector. STRATEGIC GOALS • increased profitable production of food, fibre and timber products by all categories of producers(subsistence,smallholder and commercial) Sustained management of natural resources Effective natural regulatory services and risk management systems A transformed and united sector Increased contribution of the sector to economic growth and development Effective and efficient governance

  4. MANDATE, VISION AND STRATEGIC GOALS……. DAFF works with the Provincial Departments and compliment each others activities to achieve the shared goals of reducing poverty and improving lives DAFF also work cooperatively with the SOEs (ARC, NAMC, PPECB, Land Bank ,Ncera and OBP) that reports to the Minister in achieving the above objectives. DAFF was allocate R 3.9 billion to execute its mandate during the financial 2010/11

  5. OVERVIEW The Department presents its Annual Report for 2010/11 financial year This presentation focuses attention on the departmental achievements made during 2010/11 period, The amalgamation process to incorporate forestry and fisheries functions within the agriculture setup has been completed. Of the 12 key Outcomes identified for implementation over the coming four years, DAFF directly contributes to Outcomes 4, 7 and 10. The operating environment was also influence by the following new government-wide policies: New Growth Path , Industrial Policy Action Plan and Comprehensive Rural Development Plan. The Integrated Growth and Development Plan for the AFF sectors guiding sectoral response to the abovementioned policies in addressing national challenges.

  6. SECTOR ECONOMIC HIGHLIGHTS The Strategic Plan 2010 -11 was implemented in the following domestic and global economic environment: Global financial and economic uncertainty and the debt crisis in Europe continue to keep global markets jittery with the talk of another global recession gaining momentum. The prevailing global economic situation has impacted negatively on exports – especially to countries that are our biggest importers in Europe. During the past year (especially since August 2010) agricultural commodity markets experienced significant volatility as the balance between demand and supply tightened and adverse weather conditions occurred.

  7. SECTOR ECONOMIC HIGHLIGHTS……. Gross farming income from all agricultural products for 2010/11 is estimated at R131,7 billion, which is 0,4% lower than for the previous corresponding period. Gross farming income from field crops decreased by 12,0% and amounted to R27,6 billion. The income from horticultural products rose by 0,6%, from R35,3 billion to R35,5 billion. Income from animal products amounted to R68,6 billion, which showed an increase of 4,7%. Prices received by farmers for agricultural products and prices paid by farmers for farming requisites increased on average by 4,3% and 13,2 %, respectively, resulting in the terms of trade weakening from 0,93 to 0,86% during 2010/2011.

  8. SECTOR ECONOMIC HIGHLIGHTS … Apart from the floods experienced during the last quarter of the year under review, stronger linkages between agricultural commodities and energy markets through inputs such as fuel and fertiliser, and through the demand for feedstock in the bio-fuels industry: have impacted negatively on inputs and food prices. The total catches and the free on board value of the production output of the fishing industry from 2010 is approximately 650 000 tons and R6,5 billion. Over the next decade the demand for food is expected to grow consistently in line with population growth, whilst in real terms, world commodity prices are likely to remain fairly stagnant albeit at a higher plateau compared to the previous period from 2000 to 2010.

  9. SECTOR ECONOMIC HIGHLIGHTS … The FAO food price index reached a record high in February 2011, mainly due to increased prices of cereals, meat and dairy products globally. In Western and Central Africa the prices of domestically produced staple foods have been relatively stable. As for Eastern and Southern Africa, prices of locally produced coarse grains have increased. For example, Somalia has been hard-hit with sorghum and maize prices soaring over 200% between October 2010 and April 2011. The situation is even worse In North Africa, which is traditionally dependent on cereal imports as production has declined as a result of drought and erratic rains as well as civil strife. Consequently, rising international grain prices will remain a major concern for food security in many African countries.

  10. SECTOR ECONOMIC HIGHLIGHTS ….. The forestry industry: is showing steady recovery since the 2008 recession and the resulting decline in pulp and paper demand. This is driven mostly by packaging and tissue grades. With the exception of fluting and kraft papers, tonnages across all grades have recovered from their 2008/09 lows. The Rand value of production is significantly higher due to higher global prices, which appear to be driven by the global trend of rising resource prices, labour, energy and water costs in the forestry industry. The imports of paper and packaging grades (except for tissue products) continue to rise strongly showing a 28% increase since 2006 outstripping domestic production which has declined by about 4%. This is partly attributable to the relatively strong Rand of recent years. The lack of any trade tariffs also make South Africa an easy target for dumping, which even when not in great quantities, disrupts local markets.

  11. ECONOMIC SECTOR Conti… South Africa is a net exporter of fish and fish products. In some cases, like Rock Lobster, Squid, Tuna and Demersal Longline, almost the entire production is exported, The country is also exporting about 52% of the total demersal trawl catches (economically the largest fishery). The products are mainly destined for Europe, Japan and the USA. The fisheries industry employment is about 27000 direct jobs as well as additional 81000 jobs in the sectors that are at least partly dependent in the fishing industry. Increasing job losses (an average decrease of 5% per quarter in employment) leaving agriculture with a total of 598 000 jobs, remains a challenge. By improving the competitiveness of the commercial sector, labour absorptive capability and supporting smallholders to become commercially viable, the country positively overcoming the challenges of a concentrating sector and an increasingly competitive global market. The above achievements will be further enhanced through the implementation of the Provincial Job Creation Projects, the Smallholder plan, and the Zero Hunger Programme.

  12. BUDGET PROGRAMME PERFORMANCE ADMINISTRATION POLICY, PLANNING, MONITORING AND EVALUATION ECONOMIC DEVELOPMENT, TRADE AND MARKETING FOOD SECURITY AND AGRARIAN REFORM AGRICULTURE PRODUCTION, HEALTH AND FOOD SAFETY FORESTRY AND NATURAL RESOURCES MANAGEMENT FISHERIES MANAGEMENT

  13. ADMINISTRATION PROGRAMME 1

  14. ADMINISTRATION The biggest challenge facing the Department during the period under review, was the finalisation of the macro organisation of the newly created Department, this has now been completed. The matching and placement of members of the Senior Management Service (SMS) and the configuration of the micro structure and the concomitant alignment of the post establishment and incumbents. On 31 March 2011 the post establishment of the Department totaled 7043 posts. The department has spent R1, 189 billion on employee compensation During the reporting period the vacancy rate on the Department’s post establishment decreased from 14,8% to 11,3%. The delays in the personnel suitability checks conducted by National Intelligency Agency (NIA) (security checks and citizenship checks) and South African Qualification Agency (SAQA) (qualification verifications) however poses a challenge in terms of the turn around times to fill vacant posts.

  15. ADMINISTRATION CONT… All SMS posts were subjected to job evaluation during the period under review. A total of 56 employees attended and completed the Adult Basic Education and Training (ABET) Programme during the reporting period, while 1 155 employees attended credit-bearing skills programmes and learnerships. A total of 208 employees were awarded bursaries, totaling R 1,7 million. The departmental Internship Programme attracted 175 students. During the period of reporting 17 SMS members were trained on Disciplinary Procedures in the PublicService.

  16. POLICY, PLANNING, MONITORING AND EVALUATION PROGRAMME 2

  17. POLICY, PLANNING, MONITORING AND EVALUATION The Transfer of Rights Policy and the Small-scale Fisheries Policy were gazetted. The Policy on the Transfer of Commercial Fishing Rights was published and gazetted. The programme continued with the granting of interim relief measures pertaining to exemptions/permits. The list of protected trees under the National Forest Act was gazetted for public comment. The Pesticides Policy was approved by the Minister and has been gazetted. A discussion document was finalised towards the provision of primary plant health diagnostic services in rural areas in partnership with the ARC and in synergy with departmental extension support services.

  18. POLICY, PLANNING, MONITORING AND EVALUATION…… Draft policy on organic agriculture is at a stakeholder consultative stage. A discussion document was finalised towards the provision of primary plant health diagnostic services in rural areas in partnership with the ARC. Draft Food Safety Policy was widely consulted and is currently in the Cluster and Cabinet process before gazetting. The list of protected trees under the National Forest Act were gazetted for public comment. Frameworks for both planning, monitoring and evaluations have been completed to ensure alignment and accurate reporting of performance information. The budget structures of provincial dept of agriculture have been standardised for cooperative planning and reporting on national targets.

  19. ECONOMIC DEVELOPMENT, TRADE & MAKERTING PROGRAMME 3

  20. ECONOMIC DEVELOPMENT, TRADE & MARKETING The department continue to strengthen South Africa trade relations with African countries through (Comprehensive African Agricultural Development Programme) CAADP. Below are Initiatives achieved within the year: Memoranda of Understanding (MoUs) and agreements with Zimbabwe, Swaziland and Uganda were finalised. The programme also participated in bilateral meetings with Namibia, Lesotho, Mozambique, DRC and Algeria. Participated in Southern African Development Community (SADC) and African Union (AU) initiated multilateral meetings to enhance agriculture, forestry and fisheries development and trade among African countries Participated in South African Custom Union (SACU) meetings to facilitate the adoption of standards to ensure proper movements of goods in the custom union and also the negotiation of free trade with other regions

  21. ECONOMIC DEVELOPMENT, TRADE & MARKERTING Cont… Facilitated the exports of 57% products into the EU and the SADC—the two biggest destinations for South African exports and the remaining 43% exported to other markets. Continued to participate vigorously in World Trade Organisation(WTO) Doha Development Agenda negotiations regarding modalities for further reform of agriculture. Unfortunately, the other areas of negotiations have been halted. Since becoming a full member of the Brazil,Russia, India, China and South Africa (BRICS) group, new markets and trade opportunities have been created and work is continuing building on IBSA to strengthen technical cooperation to maximise the trade and development opportunities offered by each member country. After more than ten years of negotiations with Japan, market access was achieved for one variety of South African Table grapes (Barlinka).

  22. PROGRAMME 3: ECONOMIC DEVELOPMENT, TRADE Cont… Participated in the Shanghai World Expo 2010 for six months (May-October) to promote our products to the new East Asian market. Continued to engage the developed countries under the G20 umbrella to allocate more funding to agriculture, forestry and fisheries development for the most food insecure countries in the World Organizing the African Ministerials summit on Climate-Smart Agriculture (CSA) which was held from 13-14 September 2011 in Johannesburg. The outcome of the summit was a Communiqué which was translated into French, Arabic and Portuguese and noted by the African Ministerial Conference on the Environment (AMCEN).

  23. FOOD SECURITY AND AGRARIAN REFORM PROGRAMME 4

  24. FOOD SECURITY AND AGRARIAN REFORM A draft Food Security Policy was developed and its initial implementation strategy, the `Zero Hunger Programme` was initiated. The National Delivery Forum for Vulnerable Workers on farms and in forestry and fisheries was established after the Terms of Reference (ToR) for its establishment had been adopted. The plan to convert the 12 colleges of agriculture into national Agricultural Training Institutes is at an advanced stage. An audit has been completed to ascertain the feasibility of the programme. The centres of excellence will be developed in commodity lines for the training and development of smallholder producers.

  25. FOOD SECURITY AND AGRARIAN REFORM………. Capacity building workshops on the understanding of the National Forest Act and the National Veld and Forest Fires were conducted for various stakeholders including communities an the fire protection associations. Weather and climate capacity-building workshops were conducted for officials in the North West and Limpopo provinces where 68 officials participated . A total of 670 extension officers were enrolled with various universities and universities of technology for qualification upgrading, 1 947 were trained on different skills programmes Owing to effective coordination of training, a total of 31 474 members of communities, including 10 298 smallholder farmers were trained through CASP of which, 3 929 women and 6 369 males were trained, 2 606 were the youth.

  26. FOOD SECURITY AND AGRARIAN REFORM………. In terms of the NGP, agriculture has a significant potential to create jobs. About 9 361 jobs were created through CASP, 854 permanent and 8 507 temporary. 3 581 jobs were created through Ilima/Letsema. 504 of these jobs were permanent and 3 077 temporary. A total of 8221 job opportunities have been created by Mafisa funded enterprises during the 2010/11 financial year. Of this figure, 5560 were casual opportunities while 2467 constituted permanent opportunities. These job opportunities include owner operators and workers employed by enterprise owners. The number does not include workers employed by contractors contracted to provide services to the funded farmers

  27. FOOD SECURITY AND AGRARIAN REFORM………. Micro-agricultural Financial Institutions of South Africa (MAFISA) retailing institutions disbursed loans to 3 910 clients across the country for various agriculture-related enterprises . A total of 27 972 targeted beneficiaries were supported through Ilima/Letsema 75 207 beneficiaries were supported with production inputs for their household and food gardens. 5 650 subsistence farmers were supported with production inputs and mechanisation through Ilima/Letsema projects, planting on 127 198 hectares of land. Mpumalanga province through the Masibuyele Emasimini and the use of mechanisation provided by DAFF, planted 75 575 hectares of grain and sorghum for their subsistence farmers.

  28. AGRICULTURE PRODUCTION, HEALTH AND FOOD SAFETY PROGRAMME 5:

  29. AGRICULTURE PRODUCTION, HEALTH AND FOOD SAFETY In spite of improved control measures, there was an outbreak of Rift Valley fever in the Western Cape in January 2011; FMD in KZN , African horse sickness and avian influenza in the Western Cape during February 2011. Avian influenza has impacted on the export of poultry meat, including ostrich meat. The Foot and Mouth Disease is currently well under control ,over 120 000 animals were vaccinated and thus far no cases has been reported since April 2011. African Horse Sickness has been found in the Western Cape areas and there have been no exports of Horses to EU since March 2011 Avian Influenza infected Ostriches In Western Cape (infected area described as Klein Karoo Valley) and 35 000 birds were culled and R33 million compensation was paid by end August 2011. Detections of African invader Fruit fly in Limpopo province were successfully eradicated and trading partners accordingly informed.

  30. AGRICULTURE PRODUCTION, HEALTH AND FOOD SAFETY…….. Research and technology development is looking at new approaches which could optimise on the existing capacity to achieve increased food production. Undertook collaboration work with the ARC to enhance livestock production for small-holder farmers through various schemes A total of 1415 beef farmers with a herd size of 15113 animals were assisted in the beef improvement scheme A total of 729 herds (dairy) and 17 goat herds participated in the milk recording scheme to increase milk production ( 6%)

  31. AGRICULTURE PRODUCTION, HEALTH AND FOOD SAFETY…….. Due to increased numbers of tourists for 2010 FIFA World Cup, DAFF strengthened disease surveillance systems and improved control measures at all ports of entry and this initiative proved to have been a success. Thanks to the commercial farming community who worked closely with the department to speedily act against the pest.

  32. FORESTRY AND RESOURCES MANAGEMENT PROGRAM 6

  33. FORESTRY AND RESOURCES MANAGEMENT Forestry Development focused on renewed growth as well as on transformation and sustainability of the sector and the value chain. A total of 1 000 ha was afforested in the Eastern Cape and 1 962 ha in KwaZulu-Natal. The Afforestation licensing process still presents a major constraint in reaching the target of 10 000ha committed in the Forestry Transformation Charter. Devastating veld and forest fires occurred which affected the rural economies and endangered indigenous flora and fauna, while also affecting the quality of the soil. The enforcement of legislation was stepped up to ensure the protection and conservation of our natural resources. The Department has finalised the State of the Forest Report 2007 – 2009 which highlights major challenges and responsive measures.

  34. FORESTRY AND RESOURCES MANAGEMENT ………… DAFF participated in COP 16 in Mexico in November/ December 2010, the conference added value to the Copenhagen accord discussions leading to the Cancun Agreements including the establishment of the Green Fund. A national climate change stakeholder conference to solicit inputs not only for a COP17 common position but also the development of Sectoral Climate Change Mitigation and Adaptation Plan was held from 11-12 August 2011 in Pretoria where various stakeholders including members of the Portfolio Committee participated. DAFF also formed part of the Climate negotiations under the United Nations Framework Convention on Climate Change (UNFCCC). The Department has successfully won the bid to host the 14th World Forestry Congress 2015. The conference will be hosted in Durban, KwaZulu-Natal.

  35. FORESTRY AND RESOURCES MANAGEMENT ………… Funding has been made available for the floods that occurred in December 2010, the Flood Assistance Scheme has been established and the focus is on the repair of damaged infrastructure. A vulnerability assessment on climate change was conducted and three vulnerable areas were identified in the south-western parts of the Free State and adaptation strategies are being developed. 571 commercial farmers, 2 024 smallholders and 2 134 subsistence farmers adopted land-use best practices. 25 fire protection associations (FPAs) were registered.

  36. FISHERIES MANAGEMENT PROGRAMME 7

  37. PROGRAMME 7: FISHERIES MANAGEMENT The Transfer of Rights Policy and the Small-scale Fisheries Policy were gazetted. The Policy on the Transfer of Commercial Fishing Rights was published and gazetted. The programme of granting of interim relief measures pertaining to exemptions/permits continued. In Fisheries, all Abalone diving surveys were completed in Zone B (20 survey points). A preliminary joint survey was carried out in conjunction with industry stakeholders. The stock assessment report on Eastern Cape abalone was reviewed.

  38. PROGRAMME 7: FISHERIES MANAGEMENT Cont…. Joint partnerships with law enforcement and conservation agencies, have been established and are maintained. e.g. with the SAPS, the South African National Defence Force (SANDF), South African National Parks (SANParks), the SARS, KwaZulu-Natal/Ezemvelo Wildlife and Swellendam Municipality. Concluded a draft Fisheries Policing Strategy which is currently going through a consultative process. The research project on spawning sea urchins was successful. Phase 1 of the scallops grow out trials was completed. An initiative to expand aquaculture into rural areas is at an advanced stage, Negotiations were concluded with the Universities of Cape Town, Rhodes, KwaZulu-Natal, Stellenbosch and the Western Cape to enter into MoUs with DAFF to undertake aquaculture research.

  39. PROGRAMME 7: FISHERIES MANAGEMENT Cont…. A programme aimed at promoting equitable and sustainable management and efficient use of marine living resources is progressing well with the development of small scale fisheries policy. Additional fishing rights on account of available Total Allowable Effort (TAE) allocated in Large Pelagics fishery and appeals finalised. Stakeholder engagement on alternative livelihoods and projects identified for implementation. Management program for rebuilding depleted fish stock is showing positive results, though at a slower rate (Rock Lobster and Hake). The 40% target of landings inspections has been achieved, to strengthen surveillance and compliance to permit conditions.

  40. BUDGETS AND EXPENDITURE ADMIN –PART 2

  41. FINANCIAL STATEMENTS Vote 25 Unqualified audit report Predetermined objectives Presentation of information Usefulness of information Reliability of information Other matters Content of strategic plan Material misstatement Irregular expenditure Procurement (three written price quotations)

  42. ACTUAL SPENDING R’000 Main estimate Agriculture, Forestry and Fisheries 3 657 984 Plus: Adjustments estimate 295 870 Total amount appropriated 3 953 854 Less: Actual expenditure 3 850 664 Variance 103 190

  43. ACTUAL SPENDING R’000 Underspending 103 190 Less: Lease payments: office accommodation 12 299 Transfer payments withheld: Provinces underspending CASP 33 658 Ilima/Letsema 7 500 Fencing projects – Lesotho border 2 926 Farmer Register Project 19 509 Not spent by the Department 27 298 % of total appropriation 0,7

  44. ACTUAL SPENDING PER PROGRAMME Final Actual % Variance Appropriation Expenditure Spent R’000 R’000 Administration 476 991 455 492 95.5 21 499 Production and Resources Management 442 159 Final Actual % Variance Appropriation Expenditure Spent R’000 R’000 Administration 476 991 455 492 95.5 21 499 Production and Resources Management 442 159 426 186 96.4 15 973 Agriculture Support Services 1 744 891 1 710 902 98.1 33 989 Trade and Agricultural Development 97 129 76 538 78.8 20 591 Food Safety and Biosecurity 363 575 362 583 99.7 992 Forestry 525 451 515 329 98.1 10 122 Fisheries 303 658303 634100.024 Total 3 953 854 3 850 664 97.4 103 190

  45. ACTUAL SPENDING PER ECONOMIC CLASSIFICATION Final Actual % Variance Appropriation Expenditure Spent R’000 R’000 Current Payments Compensation of employees 1 190 848 1 189 923 99.9 925 Goods and services 603 113 564 246 93.6 38 867 Interest and rent on land 1 380 1 195 86.6 185 Transfers and subsidies 2 036 953 1 983 747 97.4 53 206 Payments for capital assets 121 300 111 301 91.8 9 999 Payments for financial assets 260 252 96.9 8 Total3 953 854 3 850 664 97.4 103 190

  46. CHALLENGES The length of a legislative process against the pressures of delivery. Intergovernmental relations as a hindrance to implementation. Consolidation of departmental focus (amalgamation) took a longer period of time. Pressure on available appropriate technical skills and experience. Resources to deal with emergency pest eradication requirements (financial and procurement procedures) Stakeholders relations and engagements. Limited public and private investment in storage facilities to support smallholder farmers who experienced limited or no access to storage infrastructure in the agricultural and forestry sectors.

  47. CHALLENGES CNT… Low share of agriculture and forestry freight to total freight moved by Transnet Freight Rail (TFR) Funding challenges for commodity strategies makes it difficult for the DAFF to get a buy-in from stakeholders

  48. WAY FORWARD The department is working on aligning and standardizing all M&E responsibilities incl. reporting and verification in DAFF, PDAs and SOE’s. DAFF is also working with PDAs to improve quality on performance information.