1. RECAPITALIZATION AND DEVELOPMENT PROGRAMME (RADP)
PRESENTATION TO PORTFOLIO COMMITTEE ON RURAL DEVELOPMENT AND LAND REFORM
PUBLIC HEARINGS ON RADP
4-5 FEBRUARY 2015

2. BUSINESS PROCESS FLOW PRESENTATION OUTLINE Introduction
Background on the Programme
Objectives of the RADP Policy
Funding Model
DPME Programme Evaluation and Findings
Management Reponses
Progress to date on the Programme
RADP Impact on Key Commodities
Current Challenges and Interventions

3. INTRODUCTION
MTSF serves as “the principal guide to planning and resource allocation across all the spheres of government” and also sets out the country’s developmental challenges, it is best viewed as a “frame of reference” designed to guide the government’s policy position and programmes of action, it is informed by the election manifesto of the governing party.
The National Development Plan (NDP) identifies six policy imperatives, which will be the focus areas in this MTSF period:
Improved land administration and spatial planning for integrated development in rural areas;
Sustainable land reform (agrarian transformation);
Improved Food Security;
Smallholder farmer development and support (technical, financial, infrastructure) for agrarian transformation;
Increased access to quality basic infrastructure and services, particularly in the education, healthcare and public transport in rural areas; and
Growth of sustainable rural enterprises and industries characterised by strong rural-urban linkages, increased investment in agro-processing, trade development and access to markets and financial services – resulting in rural job creation.
NB: Through RADP the Department contributes to the MTSF priority 4.

4. BACKGROUND ON THE PROGRAMME
In 2009, the Department undertook an evaluation of the implementation of the Land Reform Programs since their inception.
It identified that many land reform projects were not successful and thus in distress or lying fallow;
There was a lack of adequate and appropriate post-settlement support;
Numerous properties acquired through various sub-programs (such as the Land Redistribution for Agricultural Development (LRAD) were on the verge of being auctioned or had been sold due the collapse of the project, resulting in a reversal of the original objectives of land reform;

5. BACKGROUNG CONTINUE……
RADP was introduced in 2009 in order to address the above challenges; RADP targets properties acquired since 1994 through Restitution and Redistribution programmes; and
Aims to contribute to the transformation of the rural economy through establishment of enterprise and industrial development in the various agricultural value chains.
to ensure national and household food security
to promote job creation
Implemented correctly, RADP would result in the significant reduction of the rural – urban population and resource flow.

6. OBJECTIVE OF THE RADP POLICY
The policy has three strategic objectives:
That Land Reform farms are 100% productive;
That the class of black fledgling commercial farmers which was destroyed by the 1913 Natives Land Act is rekindled ;and
That the rural-urban population flow is significantly reduced.

7. RADP ALIGNMENT WITH GOVERNMENT MANDATE
RADP program took cognizance of the following:
Reversing the legacy of the 1913 Native Land Act;
The Constitution of the Republic: Section 25,26,27 and 36;
The Comprehensive Rural Development Plan (CRDP); and
Alignment with the National Development Plan and Medium Term Strategic Framework.

8. INTENTIONS OF THE PROGRAMME
The policy seeks to:
Provide black emerging farmers with the social and economic infrastructure and basic resources required;
Combat poverty, unemployment and income inequality;
Reduce tide of rural-urban migration; and
Complements agricultural development programs of the Department of Agriculture, Forestry and Fisheries (DAFF).
The policy is not meant to:
Substitute for, or compete with the agricultural development programs of the DAFF; and
Create a welfare program meant to provide support to so-called beneficiaries.

9. THE PROGRAMME DOES NOT PROMOTE,,,,,
Supporting people who have means to develop their land;
Promote proxy farmers - people who run their own businesses in towns and cities, but employ managers to run their farms; and
Failed commercial farmers who want to make a fortune from disbursements meant to fairly compensate strategic partners for work done.

10. THE PROGRAMME STRATEGY….
The new strategy has taken into account and tried to address challenges that have been identified in the old RECAP policy through the following Strategic Partnership arrangements:
Mentorship of emerging farmers and/or land reform farmer;
Co-management;
Share-equity arrangements; and
Contract farming and concessions.

11. THE PROGRAMME STRATEGY CONTINUE…
In the RADP policy emphasis is placed on:
Assessing capability of emerging farmer;
Assessing farm needs with regards to RECAP;
Use outcome of the above to determine kind of partnership appropriate for the farm;
Enter into milestone based performance agreement with termination clause
Deploy partner and monitor performance;
Analyse social and economic impact; and
Close out report at the end of five years.
The above will determine the lease termination or continuation.

12. PROGRAMME FUNDING MODEL

13. PROGRAMME FUNDING MODEL CONTINUE…
pore
PROGRAMME FUNDING MODEL CONTINUE…
The model above demonstrates the tripartite collaboration between the DRDLR, Strategic partner/s and Farmers or Entrepreneurs;
The middle numbers (1-5) demonstrate the five-year involvement of DRDLR in the farm both financially and at the project management level; and
The contribution of the DRDLR will decrease from the first year to the fifth year whilst the contribution of both SPs and Farmers or Entrepreneurs will increase both financially and at the project management level.

14. DPME RADP IMPLEMENTATION EVALUATION FINDINGS AND RECOMMENDATIONS

15. CONTENT OF THE EVALUATION PROCESS
INTRODUCTION
PURPOSE OF EVALUATION
KEY QUESTIONS
METHODOLOGY
KEY POLICY FINDINGS
RECOMMENDATIONS
RADP – DMPE EVALUATION

16. BACKGROUND TO THE STUDY…
Implementation Evaluation of the Recapitalisation and Development Programme, by the Department of Performance Monitoring and Evaluation, from inception (2010 till July 2013);
Service provider: Business Enterprises, University of Pretoria;
The Recapitalisation and Development Programme is a post settlement support programme in the Department of Rural Development and Land Reform;
DPME - custodian of the evaluations
RADP – DMPE EVALUATION

17. PURPOSE OF THE EVALUATION…
Provide strategic information on the implementation of the RADP since inception;
Compile lessons learned & recommendations to strengthen the implementation of RADP;
Analyse the stakeholders’ effectiveness during the implementation of the programme;
To establish whether the programme is on track to achieve its intended objectives; and
To advise on what needs to be done to ensure better implementation of the programme.
SECRERADP – DMPE EVALUATION

18. KEY QUESTIONS DURING THE EVALUATION…
Are the two interventions (strategic partnership and mentorship) effective in developing the projects?
Does the programme effectively develop the intended beneficiaries to participate in commercial production?
Is the programme reaching its targeted beneficiaries?
Was the RADP designed appropriately for the achievement of its objectives?
Are the resources used efficiently? Is the value for money being obtained?
What are the strengths and weaknesses of the programme in achieving its objectives in relation to the technical competencies of the various stakeholders?
How can the programme be strengthened?
Is the RADP project cycle aligned to the farming operations?
Are the intended objectives of recapitalization & development programme being achieved / are likely to be achieved?
RADP – DMPE EVALUATION

19. METHODOLOGY…
Respondents identified from 640 farms, and were classified into the following categories:
Project/farm management: A structured questionnaire to the management (emerging farmers) of the farms/projects.
Focus Groups (emerging farmers other than project managers): A checklist was used in cases where, in addition to the project manager, there were other beneficiaries.
Strategic partners: Interviews with strategic partners using a checklist.
RADP – DMPE EVALUATION

20. METHODOLOGY CONTINUE…
Project officers: DRDLR officials responsible for the Recapitalisation and Development Programme project facilitation and coordination with strategic partners and mentors were interviewed using a checklist.
Provincial leadership (provincial government officials): A checklist was used for interviews with DRDLR provincial managers responsible for land reform and the Recapitalisation and Development Programme .
National leadership (national government officials): A DRDLR official (Director) at the national level responsible for the Recapitalisation and Development Programme was interviewed using a checklist.
RADP – DMPE EVALUATION

21. KEY FINDINGS…
The Recapitalisation and Development Programme (RADP) has made some progress towards achieving its intended objectives, but there is room for significant improvement.
About 540 additional jobs were created (111 full-time & 429 part-time) on the 98 farms under evaluation after the RADP was implemented. The number of jobs created is too small to justify the amount of investment in the RADP. There seems to be insufficient emphasis on job creation within the RADP;
Most of the RADP stakeholders interviewed believe that food security has improved after recapitalisation. With regards to agricultural production, it is on-going on 70% of the projects included in the evaluation. Both crop & livestock production increased after recapitalisation;
An area in which the RADP, seems not to have made much progress, is facilitation of market access for farmers.
RADP - DPME EVALUATION

22. KEY FINDINGS CONTINUE…
The RADP objectives are too ambitious and involve aspects that are normally outside the control of the programme;
Key terms used in the objectives are not clearly defined, resulting in possible misinterpretation by those implementing the programme;
There are varying degrees of understanding amongst stakeholders of what the RADP entails;
There is no clarity on the selection criteria for beneficiaries and farms to form part of the RADP; this has resulted in the inclusion of beneficiaries that did not necessarily deserve to be assisted;
The grant funding approach in the RADP is not sustainable given the limited resources available and it promotes dependency on state funding among beneficiaries.
The approach limits the coverage of the programme in terms of the number of farmers that may be assisted;
RADP – DMPE EVALUATION

23. KEY FINDINGS CONTINUE…
Strengthening the RADP is the second-best solution, however, the RADP should continue in the interim, while a lasting solution is sought.;
9. The best and lasting solution would entail a redesign and overhaul of all public agricultural support programmes and doing away with existing silos of funding for agricultural support services. This would entail the establishment of an all-inclusive fund to support land acquisition, extension services and mentorship, agricultural finance and market access.
RADP – DMPE EVALUATION

24. KEY RECOMMENDATIONS…
The following key recommendations are meant to strengthen the RADP whilst a lasting solution is sought:
Review the objectives of the RADP to make them more clear and specific. This should include defining the meanings of key terms used in the programme (e.g. distressed farms, recapitalisation, development, commercial farmer, etc.).
Ensure a common understanding of the RADP among its stakeholders by engaging in an all-inclusive process to discuss the nature, operation, purpose and objectives of the programme.
Develop clear and specific selection criteria for beneficiaries and land reform farms for recapitalisation and development in line with the objectives of the RADP. The criteria should be developed to ensure that only deserving land reform farms and beneficiaries are selected for participation in the RADP.
RADP – DMPE EVALUATION

25. KEY RECOMMENDATIONS Continue…
Replace the current RADP grant funding with loan funding. Changing to loan funding would increase the coverage of RADP in terms of the number of beneficiaries assisted as the money paid back would become available for on-lending to more beneficiaries.
Establish guidelines to limit the amount of RADP funding per project in order to widen the coverage of the programme and ensure that the funding model is adapted to the various agricultural production systems.
RADP – DMPE EVALUATION

26. MANAGEMENT RESPONSES AND INTERVENTIONS TO ADRESS FINDINGS AND RECOMMENDATIONS

27. RECORD OF AGREEMENT OR DISAGREEMENT Discussion
RECOMMENDATIONS
RECORD OF AGREEMENT OR DISAGREEMENT
Discussion
1. Strengthening RADP is a second-best solution. The best and lasting solution would entail a redesign and overhaul of all public agricultural support programmes and doing away with existing silos of funding agricultural support services. This would entail the establishment of an all-inclusive fund to support land acquisition, extension and mentorship, agricultural finance and market access.
Agree with recommendation:
Hence the Department together with DAFF has developed an integrated funding model for post settlement support to farmers.
2. As our second best solution, we recommend that RADP should continue in the interim. Hence, the following key recommendations are meant to strengthen RADP whilst a lasting solution is sought.
Agree with the recommendation:
3. Review the objectives of RADP to make them more clear and specific. This should include defining the meanings of key terms used in the programme (e.g. distressed farms, recapitalization, development, commercial farmer, etc.).
This has been addressed in the new policy and draft manual is being developed to address this finding.
4. Ensure a common understanding of RADP among its stakeholders by engaging in an all-inclusive process to discuss the nature, operation, purpose and objectives of the programme
Agree with recommendation. RADP draft manual is being developed and will be works hoped to both internal and external stakeholders to address this finding, this include a communication strategy for the programme.
RADP – DMPE EVALUATION – MANAGEMENT RESPONSE

28. RADP – DMPE EVALUATION – MANAGEMENT RESPONSE
5. Establish a separate organisational structure for RADP and ensure that the programme has its own full-time staff and do away with the current arrangement of seconding staff from other units of DRDLR to work for RADP part-time. A separate organisational structure would also help to address the current problems experienced related to reporting arrangements between provincial and national RADP offices.
Agree with recommendation:
There is an approved RADP structure for both at national level and at provincial level. This structure was approved in this financial year 2013/14 by DPSA. The filling of posts is underway and adverts for all prioritized posts have been done and the recruitment will be finalized before end of the financial year.
6. Provide additional and appropriately qualified personnel dedicated to RADP to improve its administrative and functional efficiency. This will address the problem of understaffing in RADP and lack of skills, especially among project officers.
Agree with the recommendation:
In the past owing to capacity issues in the Department as a result of the new added mandate of Rural Development and also the restructuring process, officials were just placed on RADP without proper assessment of their skills as this was a new programme and there was no capacity at all. Recruitment process is underway and the relevant skills have been identified and capacity of individuals needed to implement the programme.
 7. Develop clear and specific selection criteria for beneficiaries and land reform farms for recapitalization and development in line with the objectives of RADP. The criteria should be developed to ensure that only deserving land reform farms and beneficiaries are selected for participation in RADP.
The Department understand the importance of proper selection criteria as fundamental to ensure the integrity of the program and to ensure that it reaches the targeted and deserving beneficiaries. A draft internal policy on the identification and selectiction of emerging farmers for strategic support by the Department has been developed and will be finalized before end of this financial year.
RADP – DMPE EVALUATION – MANAGEMENT RESPONSE

29. RADP – DMPE EVALUATION – MANAGEMENT RESPONSE
8. Review selection criteria for strategic partners and mentors to ensure that only those that are competent and committed to RADP objectives are selected.
Agree with recommendation
Based on the challenges that we have experienced with some of the strategic partners (, the new policy and guidelines in the draft manual have addressed this issue. Intensified selection criteria for strategic partners to evaluate their competency to assist land reform farmers. This process will be done through district and provincial committees in line with Virtuous cycle.
No Comments
9. The requirement to have a strategic partner or mentor to qualify for participation in RADP should be applied selectively to exempt beneficiaries with adequate experience and capacity to manage their farms. This will require conducting skills and needs assessment to determine the readiness of beneficiaries to carry out farming activities without a mentor/strategic partner.
Agree with the recommendations
The beneficiaries, who are able to manage their farms and have traceable record, will be allowed to work independently but still account to the Department. Criteria will be developed to assess the skills level of the beneficiaries.
10. Replace the current RADP grant funding with loan funding. RADP funding should differentiate recapitalization needs from farm development or growth needs, with a view to encourage beneficiaries to take responsibility for their enterprise/farm growth. Changing to loan funding would also increase the coverage of RADP in terms of the number of beneficiaries assisted as the money paid back would become available for on-lending to more beneficiaries.
Disagree with the recommendations:
RADP was established to ensure that farmers are given full support and assistance as most of land reform projects were not productive and others were fully indebted to financial institutions because of lack of government support. This resulted in some Land Reform projects being auctioned or needing bail out. RADP wants to ensure that before beneficiaries go to financial institutions they are given a start-up support and skills training. It also needs to be noted that RADP going forward is no longer going to fund 100% needs and development of the farm. Beneficiaries who have been assessed positively and are doing well after initially RADP support are expected to get loan to fund their businesses enterprises. Co-management and share equity strategies are introduced in the new policy. This will ensure that strategic partners invest in the program. An integrated funding model that has been developed with DAFF and National Treasury will address this finding once implemented.
RADP – DMPE EVALUATION – MANAGEMENT RESPONSE

30. RADP PERFORMANCE SINCE INCEPTION
Generally, even though there are challenges in the implementation of the Recapitalization and Development programme but significant progress has been made,
The key strategic objective of the programme is to: Provide comprehensive farm development support to smallholder farmers and land reform beneficiaries for agrarian transformation by 2019.
There are farms under the programme in terms of the 5 year funding model. This constitutes 1,4 million hectares under the programme.
Payment for the interventions is done in tranches based on the approved business plans.
Expenditure of R 3, 318, 305,359 billion for recapitalization and development incurred from November 2009 to March There are 612 strategic partners currently supporting our farmers.
The support varies from production inputs, Infrastructure, machinery and implements .

31. STATISTICS ON RADP PERFORMANCE PER PROVINCE
Number of Farms Redistributed/Restored vs Number of Farms under Recap since 2009 – March 2014
Redistributed
Restored (Restitution)
Farms Under Recapitalisation
Farms
Hectares
Claims EC
211
378
35 070
188 FS
154 17
6 870
182 GP 95
16 050
162
7 629
115
19 916
KZN
244
112
212 LP
139
56 086
304
196
79 143 MP
183 87
99 133
206 NC 80 21
62 932 81 NW
164 32
215 WC 49
34 641
687
128 64
47 714
Totals
1 319
1 800
1 459

32. STATE INVESTEMENT ON RADP PERFORMANCE PER PROVINCE
RADP expenditure up to 22 January 2015
GRAND TOTAL
Province
April 2014 to Jan 2015 EC FS
Gau
KZN
Lim
Mpu NC NW WC
Total R R R R R

33. KEY COMMODITIES FUNDED BY RADP…
RED MEAT ;
POULTRY ;
GRAIN;
CITRUS;
VEGETABLES;
DAIRY;
PIGGERY; and
GRAPES.

34. IMPACT ON FOUR KEY COMMODITIES FUNDED…
1. RED MEAT VALUE
Bloemfontein Abbattoir is the key SP under Red Meat Value Chain. Many of the farms have reached the 85% production leveIs to full production. The total number of 3,939 cattle across FS,NC and NW were acquired for 58,396 ha. The jobs created under this partnership are 132 permanent and 1,187 temporary.

35. IMPACT ON FOUR KEY COMMODITIES FUNDED…
 2. BROILER PRODUCTION:
DRDLR has recapitalized 7 broiler projects, in North West (6) and, Free State (1) since the inception. The national poultry plan has been developed to increase poultry meat supply wherein projects from LP, MP, NW,GP and FS have been prioritised. There is a poultry value HUD being initiated in the GP Province and EIA is being done. These farmers are now commercial broiler producers and, each farm is running at least seven cycles per annum. Thus, collectively, they supply about 2,359,000 ready to slaughter broiler birds to the contract market. The highest Black Commercial producer assisted by RADP is producing 528,000 Birds per cycle in the North West Province.

36. IMPACT ON FOUR KEY COMMODITIES FUNDED CONTINUE…
3. GRAIN:
We are having 16 farms under the program of Grain SA. These farmers have collectively planted 2,400 ha under Maize and Sunflower. The farmers have been assisted with machinery, implement’s and inputs costs. Grain SA interventions is rolled out in MP, NW and GP in this current financial year wherein the total of 30 farms will be planted.

37. IMPACT ON FOUR KEY COMMODITIES FUNDED CONTINUE…
4. SUGAR CANE: The land reform transfers represent 21 % of land under commercial sugar cane production in KwaZulu-Natal (371,075 hectares). Should the valid gazetted land claims be settled timeously, the 50% of land under commercial sugar production will be owned by Black Growers. The department has invested more than R 98,174,162 in the sugar industry to support emerging cane growers who currently planted 4,524 ha under cane and 347 jobs (permanent and seasonal).

38. IMPACT ON FOUR KEY COMMODITIES FUNDED CONTINUE…
4. GRAPE INDUSTRY:
Programme has also supported farmers in the grape industry: West Coast District municipality in the Western Cape Province:
Portion 33 of the farm Rietkloof 2 The current yield is cartons of table grapes and cartons of citrus. This has improved from cartons of grapes in 2010/11 and cartons of citrus in 2010/11. There are 19 beneficiaries. The project has employed 55 permanent and approximately 600 temporary employees. Their table grapes are been exported to more than 50 countries abroad ie Europe, Far East, Middle East, Russia, USA, etc
Mont Piquet: the farm Rietkloof 144 commonly known as Mount Piquet situated in West Coast District municipality, Western Cape Province. The current yield is cartons of table grapes and 40 tons of citrus. Management indicated that the farm exports of table grapes have increased from in 2010/11 season to in 2011/12 season. There are 34 beneficiaries. The project has employed 34 permanent and approximately 605 temporary employees. Their table grapes are been exported as above to more than 50 countries abroad ie Europe, Far East, Middle East, Russia, USA, etc

39. Current Key Challenges…
Before
Unaccountability of SP – Ageing Report (All programs)
Transfer of funds from the Joint business Accounts to other private accounts
Deviation from approved Business Plan
Lack of reports for the released trenches
Coordination of Stakeholders especially on project support
Appointment of Strategic Partners by Farmers
Alignment of Business Plan , Contracts and approved funds
Models of SP (Mentorship, Contract farming, share equity and co-management) misinterpreted by farmers and SP.
Procurement of goods and services not monitored and accounted
Registration of the Assets by farmers
None alignment of lease agreement with RADP contracts
Inclusion of VAT on the requested amount
Insurance on the projects not done
Defaulters are in most cases exempted from accountability
Non compliance to Tax legislation by farmers.
Current Key Challenges…
DURING
AFTER

40. Current Key Challenges Continue…
BEFORE
Current Key Challenges Continue…
Release of tranches delayed due to non compliance by Strategic partners and farmers
Creation of commitment to DRDLR due to prior approval
Non communication of changes of BP to SP and Beneficiaries by PSSC,s
Release of funds without notification to PSSC nor RADP team
Price variation between Standard costs and BP
Quality of services by contractors and sub-contracting
Dismissal of SP after the release of the Money
No re-investment of beneficiaries in the farm
Conflict management btw beneficiaries
Profit deposited in the private account
Fraudulent activities on the account
Reimbursement of beneficiaries from RADP funds
Separation of roles and responsibility between CPA and Business Entities
DURING
AFTER

41. Current Interventions…
Several Internal workshops with Strategic partners and farmers were convened to deliberate on the key challenges in the implementation of the programme at a Ministerial level.
All RADP Contracts are being reviewed and will be completed by end March 2015
RADP Implementation Manual is being developed for completion by end March
An integrated funding model has been developed with DAFF ( integration of RADP funds, CASP and other funds)
RADP Automated management system is being developed.
Capacitation of Provincial offices with the necessary skills eg Agricultural economists at District level underway.
Forensic investigation on all RADP farms identified with mismanagement of RADP funds
All RADP subsequent trenches or release of further fundings has been put on hold until all funds disbursed are accounted for.
Current Interventions…

42. NGIYABONGA ENKOSI Thank You