This year in the budget speech of Finance Minister Gordhan, agriculture and agro-processing were prioritised. Government allocated R26.5bn towards agriculture, rural development and land reform in the 2017/18 budget.
The budget is an important indicator of how the government allocates resources and what government identifies as important to resolve the problems and challenges that the country faces.
Spending on agriculture, rural development and land reform will increase by 2% from just under R26bn in 2016/17 to R26.5bn in 2017/18, and amounting to nearly R30bn in 2019/20.
However, the funds allocated for land redistribution shows a decline (going down) of 3%, from R1.23bn in 2016/17 to R1.19bn in 2017/18. Meanwhile, the allocation for restitution increased by 2.5%, from R3.17bn in 2016/17 to R3.25bn in 2017/18.
It is clear that the budget is aimed at greater support for labour-intensive sectors, including agriculture, agro-processing and tourism-related services. The imperative it seems is to boost short-term investment. Treasury wants the budget to create jobs in agriculture! Hence the department of agriculture plans to support the production of commodities such as red meat, poultry, fruit, vegetables, wine and wheat.
How this budget is used to advance small-scale farmers will be greatly contested.
Already we see comments by AGRI-SA which argues that, “From an agricultural perspective - the R30bn spending on agriculture, rural development and land reform over the medium term is appreciated provided it will serve the purpose of what it is intended for. The focus of this spending should be on commercial agriculture i.e. moving land reform beneficiaries towards commercial production and increasing productivity of existing commercial agriculture”, said Möller from AGRI-SA.
There is some allocation in the budget directed towards support for about 435 000 subsistence and smallholder farmers through providing farm equipment, fencing, fertilizers, seedlings and other essentials; disbursing a grant through the comprehensive agricultural support programme; and repairing flood-damaged infrastructure.
The budget also stated that through the R5.3bn comprehensive agriculture support programme grant (CASP) , the Department will play a crucial role in supporting smallholder farmers who will supply produce to agri-park initiatives across South Africa.
The Agriculture, Forestry and Fisheries department also plans to increase financial support to emerging producers by R370m over the medium term, which will be accessed through the Land and Agricultural Development Bank of South Africa. The amount has been reprioritised from funding for provincial conditional grants, and will provide loans to qualifying producers.
What is clear is that Inyanda and local farmers associations, fishers and forest dwellers will have to monitor the implementation at local and provincial level very carefully.