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COMPREHENSIVE AGRICULTURAL SUPPORT PROGRAMME(CASP), ANDILIMA/LETSEMA CONDITIONAL GRANTS(FOCUS ON 2019/20 BUSINESS PLAN)DEPARTMENT OF AGRICULTURE, FORESTRY AND FISHERIESPRESENTATION TO THE PORTFOLIO COMMITTEE ON AGRICULTURE,LAND REFORM AND RURAL DEVELOPMENT3 SEPTEMBER 2019

Presentation Outline Acronyms Why CASP?o CASP objectiveso CASP pillars and targeted beneficiaries How CASP fits into the National Development Plan : vision 2030 Policy imperatives informing investments Allocations since inception CASP conditional grant framework and 2019/20 Business plan Ilima/Letsema conditional grant framework and Business plan MTEF Allocations and 2019/20 Allocations Disbursement Schedule To What extent are set objectives achieved? Challenges Way Forward2

Acronyms ACB - Agriculture Credit BoardARC – Agriculture Research CouncilAPP – Annual Performance PlanAPS - Agricultural Products StandardsCASP – Comprehensive Agricultural Support ProgramDAFF – Department of Agriculture, Forestry and FisheriesDPME - Department of Planning, Monitoring and EvaluationEC – Eastern CapeGDP - Gross Domestic ProductFMD - Foot and Mouth DiseaseFS – Free StateHSRC - Human Sciences Research CouncilICT - Information and Communication TechnologiesKZN – KwaZulu-NatalLB – Land BankLP – Limpopo3

Acronyms MAFISA – Micro Agricultural Financial Institutions of South AfricaMP - MpumalangaMTEF – Medium Term Expenditure FrameworkNAP – National Assessment PanelNC – Northern CapeNDP - National Development PlanNW – North WestPDA – Provincial Departments of AgriculturePPECB - Perishable Products Export Control BoardRAAVC - Revitalization of Agriculture and Agro-processing Value ChainsSAGAP -South African Good Agricultural PracticesWC – Western Cape4

Why CASP? The Comprehensive Agricultural Support Programme (CASP) was introduced in2004/5 financial year to respond to the gap that resulted following the closure ofthe Agriculture Credit Board (ACB) in 1998, and the broader impacts as related tothe support farmers received from government; The closure of the ACB and reduced support to the ARC led to a situation wherebydirect and indirect support to emerging or small holder farmers would shrink andwithout other instruments and or institutions it became nearly impossible for thenew beneficiaries of Land reform to access credit and or other means of supportfrom commercial banks and the Land bank. The failure to replace the ACB with a similar type of institution with a specificmandate to assist the African smallholder farmers meant that the vast investmentsmade to provide them with land was not fruitful since they were not in a position tocultivate and bring into production their newly inherited land and assets. Also the changes to the marketing environment which had been dominated bymarketing boards and a single channel marketing system meant that theagricultural cooperatives who were farmer based entities consolidated andchanged from agents of the state to privately held companies.5

Why CASP? Commercial farmers had received and benefited from the infrastructure such asstorage, marketing, input supply and extension services provided by thecooperatives which had been funded from state coffers. These were now no moreavailable to service the new emerging black farmers and beneficiaries of LandReform; Considering the historical context – whereby the African farmer of whatever shapeor form had been denied access to resources and support the growing gapbetween them and existing commercial farmers instead of narrowing actually grew. The cooperatives were far from the lands and areas where smallholder farmerswere based and by converting from farmer cooperatives into companies – theAfrican farmers were denied access to their services and support. The Strauss Commission that had spearheaded the revisions and changes to theLandbank and the broader financial landscape had made recommendations whichhad not been implemented to the full. Hence, following a review of therecommendations of the Strauss Commission it was clear that the financial“sunrise” subsidies and the adoption of a “sunrise” package to support thebeneficiaries of the land reform programme requiring finance would require a newinstitutional arrangement and framework leading to the implementation of CASP.6

CASP - ObjectivesCASP sets out to deliver a wide range of economic, social and environmentalbenefits.On the economic front : It is expected to produce higher levels of productive efficiency, create on-farm andoff-farm jobs, increase income and wealth in the rural economy; As the positive impacts of CASP on the agricultural sector gain momentum,significant amounts of domestic and foreign investment will be attracted tocomplement the initial capital injections through the programme; Leading to reversal of the inequities in farmland access and use rights inheritedfrom the apartheid era.7

CASP – Objectives (2)In terms of Social Benefits: Its contributions to household and national food securityshould significantly add to poverty reduction and improverural living standards; reduce crime, violence and sociopolitical instability resulting from conflict over limitedagricultural resources.In terms of Environmental Benefits: Pertaining to environment security, CASP supposedlypromotes ecologically sustainable farming activities.8

CASP – pillars and targeted beneficiaries The programme is delivered through six priority pillars which are:1. On and off farm infrastructure support;2. Knowledge and information management;3. Technical and advisory services;4. Training and capacity building;5. Market and business development support; and6. Financial services (branded MAFISA). Target Populationo The Hungryo Previously disadvantaged subsistence, smallholder and commercial farmerso Entrepreneurso Youth, women and people with disabilities9

How CASP fits into the NDP: Vision 2030Chapter 6: Advocates for an integrated and inclusive rural economy Grow the economy and increase jobs by expanding irrigated agriculture,focusing on: Water use efficiency and New irrigation schemes; Pick and support those industries and regions with the highest growth and jobpotential; Focus on value chains and agro – processing (create jobs and grow the ruraleconomy) Focus on Land Reformo Develop strategies that give new entrants access to value chainso Find creative combinations between opportunities, e.g. Support successful communal farmers – security of tenure Collaboration between commercial and land reform beneficiaries10

Policy imperatives informing investments1.Potential to Create 1 million jobs by 2030 (National Development Plan)2.Expand commercial agriculture to achieve 250 000 direct jobs and 130 000 indirectjobs by 2030 (support 450 black commercial farmers)3.Put 1 million hectares of unutilised land under production by 2019 (Fetsa Tlala)4.Support 300 000 smallholder producers by 2019 (New Growth Path)5.Expand 1.5 million hectares under irrigation by 500 000 (NDP: 2030 Vision)6.Ensure food security for all (Act 108 of 1996, Constitutional Mandate)7.Ensure sustainable use of natural resources8.Grow agricultural contribution to the GDP - driven by the Revitalization of Agricultureand Agro-processing Value Chains (RAAVC – 9 point plan) – throughoperationalization of the Agriculture Policy Action Plan.11

The impact study on CASP for a period2007/08 – 2011/12 was conducted by DAFFand DPME in 2014/15.Allocations since inceptionYearCASPAllocationExpenditure% SpendingNumber 236251046 5002005/2006250157631 07053 2002006/20073002528487067 4002007/20084153338078660 3002008/20095354027570331 0392009/20107156939788826 2662010/2011862854991 27127 9722011/20121 029984948142012/20131 5341 260812013/20141 6001 6002014/20151 otalProvince 000%2008/09171 000171 000171 000147 000864112009/1050 00050 00050 00067 00013412 9672010/11200 000192 000192 000191 00099.575 2072011/12400 000400 000400 000396 00099109 1972012/13415 000415 000415 000400 00096.4162 98536 5042013/14438 000438 000454 000424 00093.4147 99053659 2862014/15460 000460 000487 521484 08499.3191 39610075365 0752015/16470 768466 713466 713464 26999.5173 0191 39498804113 2571 6511 63099.71 54742 8692016/17491 363491 363491 363481 43598170 7762016/20171 6411 57295.440025 9582017/18522 139522 139522 139487 54393.3186 2432017/20181 6451 4468846822 906552 423552 423552 423524 93991.12018/2019TOTAL1 750 8101 892 56190.914 23812 70086.82018/1911 420678 532TOTAL4 170 693 4 158 638 4 202 159 4 067 2701296.8

CASP Conditional Grant FrameworkGrant GoalTo create a favourable and supportive agricultural services environment for thefarming community, in particular subsistence, smallholder and black commercialfarmers within strategically identified grain, livestock and horticulture production areas.Grant Purposeo To provide effective agricultural support services, promote and facilitate agriculturaldevelopment by targeting beneficiaries of land reform, restitution and redistribution, andother black producers who have acquired land through private means and are engagedin value-adding enterprises domestically, or involved in export.o To address damage to infrastructure caused by floods.o To revitalize agricultural colleges into centers of excellence.13

CASP Conditional Grant Framework (2)Outcome statementso Broadened access to agricultural support for black subsistence, smallholderand commercial farmers;o Increased number of sustainable and profitable black producers inhorticulture, grains, livestock, and aquaculture value chains;o Improved farming efficiency;o Improved systems required for the maintenance of a Foot and Mouth Disease(FMD) free status as prescribed by the World Organisation for Animal Health;o Increased wealth creation, and sustainable employment in rural areas;o Increased access to markets by beneficiaries of CASP;o Improved household and national food security;o Reliable and accurate agricultural information available for managementdecision making.14

CASP 2019/20 Business PlanGrant OutcomeBroadened access to agricultural support for blacksubsistence, smallholder and commercial farmersOutcome Indicator Number of subsistence farmerssupported with production inputs andmechanisation1 433Number of smallholder farmerssupported with production inputs andmechanisation6 111Number of black commercial farmerssupported with production inputs154Number of projects supported43715

CASP 2019/20 Business PlanGrant OutcomeImproved farming efficiencyOutcome Indicator Number of farmers trained26 806Number of farmers r of extension personnelprovided with resources (e.g ICTinfrastructure)Number of colleges revitalised1443 2681016

CASP 2019/20 Business PlanMaximize Job OpportunityGrantOutcomeOutcome Number of jobs createdIndicatorProvinceJobsTotal jobsECFSGPKZNLPMPNCNWWC1 343210921 9249864043906481 1597 15617

SAGAP Certification programme DAFF in partnership with PPECB and Provinces are implementing theSouth African Good Agricultural Practices (SAGAP) certificationprogramme for smallholder producers of fresh produce since January2014. In the initial stages of implementation DAFF (Marketing andSmallholder Directorates) with PPECB carried the costs for theprogramme; and CASP only addressed non-conformances relating toinfrastructure. In 2018/19 provinces were requested to enter into agreements withPPECB and carry all the costs of the programme through CASP,addressing both soft and hard non-compliances (i.e. pre-audits,training/workshops and infrastructure development); as outlined inRegulation 707 of 2005 under the Agricultural Products Standards(APS) Act of 1990.18