House Chairperson

Today, as we consider this Agriculture Budget Vote, we must speak with clarity and urgency that agriculture is not a standalone sector. It is the backbone of rural economies, food security, and inclusive growth. The sector begets the raw materials that fuel South Africa’s largest manufacturing sub-sector, turning low-value farm outputs into high-value, marketable, exportable goods while multiplying jobs and economic activities.

The agricultural sector in South Africa contributes approximately 2.8 to 3 percent to our Gross Domestic Product directly, while the broader agricultural value chain including agro-processing contributes over 14%. The sector is therefore a vital economic engine, that needs to be expanded.

Local Government

Many of our farmers in rural communities are being strangled by failing local government infrastructure. Roads and bridges that collapse after rain. Water reticulation systems that no longer deliver. Markets that cannot move produce efficiently. This is not just an agriculture problem, it is a local government failure that we must fix.

We cannot revitalize rural infrastructure without demanding accountability at local government level. There is a need to focus on building the institutional framework and infrastructure essential for a thriving farming economy which hold potential for countrywide job creation. Studies have shown that there is roughly 1.8 million hectares of land that is used far below its natural potential located mainly in Limpopo, KwaZulu Natal and the Eastern Cape

In this regard our local Municipalities need to direct much of their energy and resources to infrastructure maintenance and investment in line with the guidelines from National Treasury by allocating 8 per cent of its budgets towards infrastructure initiatives that will ensure proper roads and prevent collapse of rural roads that make it impossible for farmers to get inputs in or harvests out.

Fresh Produce Markets

The Competition Commissions fresh produce market inquiry affirmed that that our fresh produce markets are crucial to food security, food health and safety, local economic development and access to market by small and emerging farmers. This is a platform where farmers bring their produce to be sold, usually but not exclusively in large volumes, to wholesalers, retailers and spaza shops.

As a reflection of the structure of the economy 84 per cent of market share is concentrated in four markets, Johannesburg, Tshwane, Cape Town, and Durban.

According to the Competition Commission, the volumes of fresh produce being sold at the Fresh produce markets have been steadily declining over the years. This is largely attributed to the lack of upkeep and investments by local municipalities, which are the custodians of these markets. The mostly dilapidated infrastructure at the different municipal Fresh produce markets across the country poses challenges to producers, agents and buyers.

Central to these challenges is the poor infrastructure as municipalities do not reinvest its revenue derived from commissions.

There is further a lack of access by SME and Historical Disadvantaged farmers which points to barriers to entry, participation and expansion. This is a matter that the department needs to monitor closely and the committee to consistently oversight.

It is critical for municipalities to ring-fence profits earned from the fresh produce market they own and operate to fund capital expenditure and, where feasible, increase budget allocations, over and above the revenue generated by these markets. A special dispensation must be created by these markets to set targets to increase annual sales of SME and Historically disadvantaged farmers, and should at least increase by 10% annually.

Integrating agriculture support and Fixing Local Government to enhance local economic development is not optional, it is a foundation of unlocking the potential of our agricultural sector and creating an inclusive economy that serves all South Africans by unlocking rural economies, create jobs, and strengthen food security.

The ANC supports the vote