DAFF RESPONSES TO SUBMISSIONS BY THE
DEPARTMENT OF PLANNING MONITORING AND
EVALUATION, OFFICE OF THE AUDITOR GENERAL
RESPONSES
TO
OVERSIGHT
AND FINANCIAL AND FISCAL COMMISSION
BODIES
DATE: 18 OCTOBER 2017
OUTLINE
Chief Financial Office
 Schedule of actions to mitigate repeat audit findings
 Irregular expenditure
 Loans to staff
 Biological assets
Human Resource Management
 Critical positions not being filled
 Grievances not handled within timeframes
Policy, Planning, Monitoring and Evaluation
 Alignment between DAFF and PDAs
 Improvement plan to deal with 29% targets that are not specific
 Agricultural Census and Farmer Register
 Spending 100% budget against 80% target achievement
 Framework for measurement of impact at provincial level
2
OUTLINE
Food Security and Agrarian Reform
 The reduction on the % of households vulnerable to hunger
 Initiatives by DAFF to deal with household food security
 Unproductive land transferred to previously disadvantaged individuals
 Reduction of rural unemployment
 Producer Development Support Policy
 Mechanization Policy
 State of preparedness for the 2016/2017 summer planting season
 Rationalization of functions between DAFF and the DRDLR
 Reflection on Operation Phakisa and its Objectives
 Criteria for allocating budgets to Provinces
 Report on Ncera Farms
3
OUTLINE
Forestry and Natural Resource Management
 Feasibility of expansion of land under irrigation
 Vulnerability assessment
 Crop production forecasts
 Climate Weather Forecasts
Fisheries Management
 Allocation of rights to 9 fisheries sectors
4
ACRONYMS
ARC
CASP
CGA
DAFF
DDGs
DORA
DPME
DRDLR
DWS
EPWP
EXCO
GFADA
GHS
Ha
MLRF
MTEF
NAMC
NDP
PC
RAAVC
SAB
TID
Agricultural Research Council
Comprehensive Agriculture Support Programme
Citrus Growers Association
Department of Agriculture, Forestry and Fisheries
Deputy Director Generals
Division Of Revenue Act
Department of Planning, Monitoring and Evaluation
Department of Rural Development and Land Reform
Department of Water and Sanitation
Extended Public Works Programme
Executive Committee
Grain farmers association development association
General Household Survey
Hectare
Marine Living Resource Fund
Medium Term Expenditure Framework
National Agricultural Marketing Council
National Development Plan
Portfolio Committee
Revitalisation of Agriculture and Agro processing Value Chain
South African Brewery
Technical Indicator Description
5
CHIEF FINANCIAL
OFFICE
6
Schedule of Action to mitigate again similar future audit
matters
Content
Measures of control
Audit Matrix
Monthly or quarterly feedback
Monthly Reporting
Reconciliations
Performance Agreements
Measurable performance deliverables
Annual Performance Plans
Actionable deliverables
Workplans
Performance based feedback
Risk Management Plans
Identification of gaps
7
CHIEF FINANCIAL OFFICE
Issue to be clarified
Response
Dealing with
irregular
expenditure
Letters are written to different DDGs and the
relevant directorates about the expenditure and
the DDGs are requested to address the root
causes of the irregular expenditure
The Office of the Chief Financial Officer identifies
the irregular expenditure where the directorates
have not followed the prescripts and report to the
Accounting Officer
The DDGs are instructed to investigate and take
disciplinary action [consequence management]
and inform of the action or measures taken to
prevent future irregular expenditure from
happening
8
CHIEF FINANCIAL OFFICE
Issue to be clarified
Response
Irregular expenditure
The Audit Matrix is used as a tool to address the audit
findings and move towards achieving a clean audit
Underspending
Underspending at the MLRF was due to the EPWP funds not
being fully used and the vessels were not fully operational for
part of the year
Biological assets
The Office of the Chief Financial Officer and Internal Audit
Directorate will review the schedules that support the amount
of the biological assets as reflected in the annual financial
statements
Accruals
Accruals – DAFF is preparing full monthly financial
statements with notes on a monthly basis to prepare for year
end
9
CHIEF FINANCIAL OFFICE
Issue to be clarified
Response
Staff loans
Staff debt is a result of leave without pay, salary
overpayments, study debts and losses of
departmental assets
A debt is written off when:The debtor has neither assets nor income; or
All reasonable efforts to trace the debtor have
failed; or
The debt could not be recovered from the pension
fund;
The debt written off for 2015/16 is for exemployees and ex-students.
All reasonable steps have been taken to recover
the money.
10
HUMAN RESOURCE MANAGEMENT
Issue to be clarified
Response
Critical positions are not
filled
The R2 billion ceiling on Compensation of
Employees is affecting the filling of vacancies
Critical posts are being identified for immediate
filling
Grievances not handled
within prescripts
An action plan to deal with the grievances has
been devised
11
POLICY, PLANNING ,
MONITORING AND
EVALUATION
1
2
POLICY, PLANNING , MONITORING AND
EVALUATION
Issue to be clarified
Response
Improvement plan to
ensure that the Technical
Indicator
Descriptions
[TID]
A workshop is confirmed for 7-11November
2016 for review and alignment of transversal
indicators and TID, the management of future
planning, implementation and reporting will be
through functional working groups
Engagements are at an advanced stage with
Department of Home Affairs to get assistance
on the verification of reported identity numbers
of supported beneficiaries
13
POLICY, PLANNING , MONITORING AND
EVALUATION
Issue to be clarified
Response
Improvement Plan of
how to deal with the 29%
of the targets that were
not specific
Internal Audit will provide feed back on the
smartness of targets before finalisation of
annual performance plans deliverables.
Briefing on the
Agricultural Census and
the Farmer Register
The process of awareness around farmer
register is been intensified and regular
discussion on MinTech will take place
14
POLICY, PLANNING , MONITORING AND
EVALUATION
Issue to be clarified
Response
Spending 100% of the
budget while achieving
80% actual performance
DAFF performance components does not
refer to targets in annual performance plan
only, but services as well which are essential
and demand driven in nature and actually is
where the bulk of the budget get spent.
80% of the targets were achieved in spite of
budget cuts experienced
Measures to set up
framework for the
evaluation of the impact
of the interventions at
provincial level
Improvement plan for smallholder support is in
progress and measurement of changes at
implementation phases is one areas prioritised
15
FOOD SECURITY
AND AGRARIAN
REFORM
1
6
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Response
The reduction on
the % of
households
vulnerable to
hunger from 11.4%
to less than 9.5%
South African Vulnerability Assessment Committee
completed assessment in Kwa-Zulu Natal and Limpopo
while Undertaking of vulnerability assessment in all other
provinces and implement the results for targeting the
vulnerable groups
Implement household food production including school
and community gardens
Implement drought relief programs
Implement Fetsa Tlala programme an household food
production
Food price monitoring by NAMC
17
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Response
The reduction on the %
of households
vulnerable to hunger
from 11.4% to less than
9.5%
Coordinate other departments involved in food
production
Design and implement the subsistence farmer
program with dedicated resources and measures to
increase households involved in agriculture
targeting women and youth headed households
Implement the National Plan for Food and Nutrition
Security for South Africa
18
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Response
The reduction on the %
of households
vulnerable to hunger
from 11.4% to less than
9.5%
Land acquisition and settlement support need
matched
Resources allocated do not correspond with land
acquired and alignment of functions between DAFF
and DRDLR agreement be implemented
Support targeted to three farmer categories –
Subsistence, Smallholder and Large Scale
19
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Response
1 million ha, the land
transferred to previously
disadvantaged individuals
that is unproductive
Review finance disbursement model
Alignment of support functions between DAFF and
DRDRL has been agreed upon as on 7 October
2016
CASP / Ilima/Letsema grant support matched with
private sector funding in partnership to grow
smallholder and large scale producers.- AB InBev,
Clover, SAB Miller
Partnership with Commodity groups on development
programs. Citrus Growers’ Association (CGA), Grain
Farmers’ Association Development (GFADA)
20
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Response
Reduction of rural unemployment
rate from 49.4% to 40% by 2019.
The current performance is 45.8%
Smallholder Farmer Programme
resourced by Landcare, CASP and
Ilima/Letsema to ensure that farmers
create jobs are created
Establish and strengthen the Smallholder
and Large scale commercial programmes
that are market driven and create
employment
21
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Response
Reduction of rural unemployment
rate from 49.4% to 40% by 2019.
The current performance is 45.8%
Government intervention used as enabler
in partnership with private sector
Implement labour intensive commodity
value chains
Establish the mechanism to track
agricultural jobs within the whole and
outside government
Implement Operation Phakisa outcomes
on the Grains, Livestock and Horticulture
AB InBev - Maize & Barley, Soya
production, expansion of hectares under
horticulture.
22
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Response
Producer Development
Support Policy
Draft 3 Version1 of Policy on Comprehensive
Producer Development Support shared with PC on
13 September 2016
National Policy on Extension and Advisory Services
on Cabinet process
Integrated Development Finance policy consultation
planned for November 2016
Finalize the Comprehensive Producer Development
Support Policy
23
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Response
Producer Development
Support Policy
Obtain Cabinet approval National Policy on Extension
and Advisory Services on Cabinet process
Finalize Integrated Development Finance Policy
24
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Response
Producer Development
Support Policy
Diagnostic study and draft improvement plan on
Smallholder support is completed
Implement Phakisa will craft a recommended plan
Seek approval National Plan on Food and Nutrition
Security of South Africa
Obtain Cabinet approval on improvement plan on
Smallholder support is completed
25
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Action Plan
Mechanization Policy
Draft policy in place and copy
submitted to PC on 23 September.
Policy awaits the finalization
Comprehensive Producer
Development Support policy
Finalize the mechanization policy
together with Comprehensive
Producer Development Support
policy.
26
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Activities
Initiatives by DAFF
to deal with
household food
security
Promotional activities such as World Food Day,
Launch the planting season, Female Enterpreneur
Awards, Youth Agristars
Inputs support Household food production,
Community gardens, Schools gardens
Implement Fetsa Tlala programme
Diagnostic study and draft improvement plan on
Smallholder support is completed
27
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Response
Initiatives by DAFF
to deal with
household food
security
Obtain cabinet approval on improvement plan on
Smallholder support is completed. Implement
targeted support as recommended
Design and implement a distinct programs for the
three farmer categories ( Subsistence,
Smallholder, Large Scale) as per improvement
plan following the smallholder program diagnostic
study
Undertake vulnerability assessment in all the
provinces and implement the results for targeting
the vulnerable groups
28
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Response
State of
preparedness for
the 2016/2017
summer planting
season
Launch of the planting season done by the Deputy
Minister on 7.10.2016 in Bloemfontein
Readiness updates are provided monthly
134 164 ha reported in the readiness plans but this
is 19 962 less than in the business plan
DAFF putting measures to intervene in the Eastern
Cape Province to accelerating planting
Monitor delivery of inputs and planting fortnightly
Measures put in place to intervene in Provinces
where readiness is not satisfactory according to the
DORA framework
29
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Response
Rationalization of
functions between
DAFF and the
DRDLR
Sign the overall agreement of alignment of
functions
Do due diligence on affected programs and the
adjustment implications
Establish the protocol for the alignment of
functions.
National Treasury confirm the realigned budgets
Submit revised budget
30
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Response
Rationalization of
functions between
DAFF and the DRDLR
Agreement reached between DAFF, DRDRL and
National Treasury on 5.10.2016
DRDRL will be responsible for Land acquisition , Land
allocation and bulk and off farm infrastructure
DAFF will ensure production support, Market access ,
value addition and on farm infrastructure
National Treasury will ensure funds follow the
function
31
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Response
Reflection on
Operation
Phakisa and its
Objectives
Ensure budget allocation and plans are aligned to
implement key projects identified and prioritized
The Lab is co-hosted by the Department of Agriculture,
Fisheries and Forestry (DAFF) and the Department of
Rural Development and Land Reform (DRDLR), and
led by the DPME. It aims to:
To stimulate growth, foster job creation and instil
transformation along the agriculture and rural
development value chain.
Strategically, the Lab must contribute towards inclusive
growth, as prescribed by the National Development
Plan (NDP) and the Revitalization of the Agriculture
and Agro-Processing Value Chain (RAAVC), amongst
others
32
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Response
Criteria for
allocating budgets
to Provinces [size
of the Province vs
Agricultural [all
three areas]
Production
Allocation and transfer of the 2012 Flood disaster repair
distorts the picture of the farmer support grants. The
criteria for flood disaster is based on the area wide
damage;
The criteria for allocating CASP funds is a weighted
average of the following variables agricultural land are
available households involved in agriculture (GHS)
restitution or redistribution land delivered previous CASP
performance previous CASP performance;. prioritized or
targeted provinces
33
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Response
Criteria for allocating The criteria for allocating Ilima/Letsema funds is a
budgets to Provinces weighted average of the following variables:






agricultural land area available
previous homeland areas
households involved in agriculture (GHS)
restitution or redistribution land delivered
food insecure areas (GHS)
priority areas targeted for increased food production
(e.g. irrigation schemes
34
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Response
Report on Ncera
Farms
Internal Audit function exists has been outsourced on
contract but started during the course of 2015/16
Strengthen Internal Audit function by appointing audit
committee
National Treasury has in principle agreed to sign off the
deregistration of Ncera until the due diligence is
complete and agreement signed with ARC
Decision to transfer to Ncera has been taken and
supported by local stakeholders
Shortfall of wages and related benefits being assessed
to align with ARC equivalence
35
FOOD SECURITY AND AGRARIAN REFORM
Issue to be clarified
Response
Report on Ncera Farms
Strengthen Internal Audit function by
appointing audit committee
Additional budget to be sourced for the
MTEF to ensure equivalence of equal pay
for equal work
Transfer of land administration function to
DRDRL and Public works for
36
FORESTRY AND
NATURAL
RESOURCE
MANAGEMENT
3
7
FORESTRY AND NATURAL RESOURCE MANAGEMENT
Issue to be clarified Response
Clarity
on
the
feasibility
of
expansion of land
under irrigation by
500
000
as
captured under the
National
Development Plan
The National Development Plan (NDP) states that there are 500 000
hectares available for expansion of irrigated agriculture
However, the National Water Resources Strategy II of the Department of
Water and Sanitation (DWS) indicates that there is only 80 000ha of water
available for expansion
DAFF consulted with Bureau for Food and Agricultural Policy (BFAB) who
are the authors of chapter 6 of the NDP on the 500 000ha stipulated in the
NDP
BFAP informed DAFF that the correct figures for expansion of land under
irrigation is 145 184 ha, a letter to this effect explaining how they came to
their figure was sent to the Department of Planning, Monitoring and
Evaluation (DPME) and DAFF
Based on documents from DWS, the DAFFs’ Irrigation Strategy of South
Africa (2015) indicates that the area which can be expanded under irrigation
is currently 34 863ha. This area indicated in the Irrigation Strategy will
change once the verification and validation studies of DWS have been
completed
38
FORESTRY AND NATURAL RESOURCE MANAGEMENT
Issue to be clarified
Response
Impact Analysis:
South African
Vulnerability
Assessment
Committee
(SAVAC) Report
SAVAC modelled the impact of the current drought on
agricultural livelihoods of people residing in open
access or communal areas across the country.
According to this analysis:
 The number of people with worst drought affected
agricultural livelihoods is 6 291 900 in the Open
Access (rural) areas across South Africa.
 The output in primary agriculture has decreased by
23% in field crops, less than 1% in horticulture and
nearly 9% in livestock and collectively such decline
resulted in further declines across the value chain.
 The biggest employment losses was found in the
field crops -11%, livestock - 8.7% and sugar - 9.3%.
39
FORESTRY AND NATURAL RESOURCE MANAGEMENT
Issue to be clarified
Response
Crop Production
Forecasts: Crop
Estimates Committee,
25 August 2016
•
Commercial maize: The size of the expected commercial maize crop
has been set at 7,297 million tons, which is 26,70% or 2,658 million
tons less than the previous season 9,955 million tons. Area estimate
for maize remained unchanged at 1,947 million ha, while the expected
yield is 3,75 t/ha.
•
White maize: The production forecast of white maize remained
unchanged at 3,097 million tons, while the expected yield is 3,05 t/ha.
In the case of yellow maize the production forecast is 4, 200 million
tons, which is 19,54% or 1,020 million tons less than the 5,220 million
tons of the previous season.
•
Yellow maize: The yield for yellow maize is 4,51 t/ha.
•
The total supply of wheat is projected at 4 043 563 tons for the
2016/17 marketing season. This includes an opening stock (at 1
October 2016) of 791 523 tons, local commercial deliveries of 1 645
040 tons, whole wheat imports of 1 600 000 tons and a surplus of 7
000 tons.
40
FORESTRY AND NATURAL RESOURCE MANAGEMENT
Issue to be clarified
Response
Crop Production
Forecasts: Crop
Estimates
Committee, 25
August 2016
Commercial maize: The size of the expected commercial
maize crop has been set at 7,297 million tons, which is
26,70% or 2,658 million tons less than the previous
season 9,955 million tons. Area estimate for maize
remained unchanged at 1,947 million ha, while the
expected yield is 3,75 t/ha
White maize: The production forecast of white maize
remained unchanged at 3,097 million tons, while the
expected yield is 3,05 t/ha. In the case of yellow maize
the production forecast is 4, 200 million tons, which is
19,54% or 1,020 million tons less than the 5,220 million
tons of the previous season
Yellow maize: The yield for yellow maize is 4,51 t/ha
41
FORESTRY AND NATURAL RESOURCE MANAGEMENT
Issue to be clarified
Response
Crop Production
Forecasts: Crop
Estimates
Committee, 25
August 2016
The total supply of wheat is projected at 4 043 563 tons
for the 2016/17 marketing season. This includes an
opening stock (at 1 October 2016) of 791 523 tons, local
commercial deliveries of 1 645 040 tons, whole wheat
imports of 1 600 000 tons and a surplus of 7 000 tons
42
FORESTRY AND NATURAL RESOURCE MANAGEMENT
Issue to be clarified
Response
Climate Weather
Forecasts and
strategies
Drought continues in the provinces. The seasonal forecast
anticipates uncertain conditions during late spring in terms of
rainfall
Towards mid-summer the rainfall is expected to be above
normal but the level of uncertainty remains high with a
marginal confidence
With the seasonal forecast in mind, and the current drought,
farmers are advised to continue to conserve water and other
resources in accordance with the Conservation of Agricultural
Resources Act 1983, (Act No. 43 of 1983).
Farmers are advised to be conservative in their planting i.e.
planting density/cultivar/area being planted
Farmers should consider drought tolerant cultivars including
sorghum and maize where possible. Irrigation farmers should
reduce the planting area in line with water restrictions in their
areas
43
FORESTRY AND NATURAL RESOURCE MANAGEMENT
Issue to be clarified
Response
Climate Weather
Forecasts and
strategies
Farmers should follow the weather and climate forecast
regularly so as to make informed decisions.
Livestock farmers are advised to continue to have
precautionary measures in place. These include provision of
additional feed such as relevant licks, livestock reduction in
accordance with available grazing, provision of enough
water points in the farm where possible, as well as shelter
during bad weather conditions
Farmers are encouraged to maintain firebreaks and adhere
to veld fire warnings
Episodes of localized flooding resulting from thunderstorms
are likely and measures should be in place. Heat waves
have been reported in some areas and are likely to reoccur.
Therefore measures to combat these should be in place
Farmers are encouraged to implement measures provided
in the early warning information issued
44
FISHERIES
MANAGEMENT
4
5
FISHERIES MANAGEMENT
Issue to be clarified
Allocation of
rights to the nine
fisheries sectors
Response
The target was not achieved to:
 Initial closing date i.e., 22 January
2016 for submission of applications
was moved to 12 February 2016 at the request
from Stakeholders; and
 Further, the closing date of 12
February 2016 was moved to Friday,
26 February 2016. These extensions were to
enable potential applicants more time to
complete the forms and to collate their supporting
documentation.
46