Budget Realities for Agriculture & Rural Communities

“Government takes with both hands and then gives back with just one.” This is Francois Wilken, President of Free States Agriculture’s response to Minister Tito Mboweni’s 2021 budget. Wilken said minimum wages to increase to 16%, ESKOM tariff increases of also nearly 16% and fuel price increases together with the increased fuel tax are greater than inflation increases, with very little relief from the 2021 budget, and which will push up food prices.

Rural communities and farmers are frustrated with services delivery and infrastructure problems. The Minister sadly said nothing of how the basic services will be repaired other than mentioning infrastructure’s importance to the economy and that it is in need of repair. The fact is that farmers are in some cases not able to get produce to markets. Basics infrastructure is needed to create and sustain jobs.

“Nothing was said of Tax rebates for communities that are forced to fix public infrastructure or to incur expenses related to improving farm safety, yet we will continue to lobby for this.” Wilken says.

Free State Agriculture (FSA) welcomes the allocation to the Department of Justice and Constitutional Development to improve business processes and fight against crime and corruption. “We trust that this allocation and Justice Modernisation Programme will contribute to the safe and conducive environment necessary for the agricultural sector to flourish in the Free State and South Africa.”

The Minister seemed to steer away from divergent and divisive political ideologies, yet making clear that this is not an austerity budget, pledged R100bil for state job creation projects through the public employment programmes & Presidential Youth Employment Initiative. This continues to keep citizens dependent on the state for employment.  He also said, off the official budget script, regarding COVID support funds that he likes the idea of Government buying in equity stakes and not just dishing out grants as “gifts”.

1409 Restitution claims were budgeted for to buy in the budget period. To date government has spent over R200billion on Land Reform since 1994. This could have bought all the land claimed in South Africa for those who sought to farm and own property. To date, very few restitution beneficiaries are farming and almost no land reform beneficiaries have received their title deed for the property they live and / or farm on.

FSA accepts the marginal increases in social grants which, although increasing dependency of the electorate on the state, also increases the spending power of nearly ¼ of our citizens to buy products produced by agriculture.

The Land Bank, like Eskom, SAA and other state-owned entities, is a failed and bankrupt entity whose goal is no longer to support loans in the agricultural sector for development and growth but a political mandate of elite upliftment and cadre deployment where corruption is rife. FSA is of the view that state funds rather be used for highly subsidizing credit to be provided to historically disadvantaged individuals through the existing banks on free market principles, and so everyone has fair and equitable access to cheap capital to get started in agriculture. “We do not believe that the state should own a bank or monopolize an industry because of disastrous political influences.” says Wilken

“Agriculture has certainly proved its worth to the national economy through its resilience despite also battling the natural elements. Although not acknowledged in the budget, we welcome the reduction in companies tax and the smaller increase of tax brackets, so hence not being milked dry through stifling taxation!” says Wilken.

Begrotingsrealiteit vir landbou en landelike gemeenskappe

“Die regering neem met albei hande en gee dan met net een terug.” Dit is Francois Wilken, president van die Vrystaatse Landbou, se reaksie op Minister Tito Mboweni se begroting vir 2021. Wilken het gesê die minimum lone styg tot 16%, die ESKOM-tariefverhogings neem toe met ook bykans 16% en die brandstofprysstygings tesame met die verhoogde brandstofbelasting is groter as inflasie. Dié stygings, tesame met baie min verligting van die 2021-begroting, kan lei tot stygende voedselpryse.

Landelike gemeenskappe en boere is gefrustreerd met dienslewering en infrastruktuurprobleme. Die minister het ongelukkig niks gesê oor hoe die basiese dienste herstel sal word nie, behalwe om die belangrikheid van infrastruktuur vir die ekonomie te noem en dat dit herstel moet word. Die feit is dat boere in sommige gevalle nie in staat is om produkte na markte te kry nie, sê Wilken. Basiese infrastruktuur is nodig om werk te skep en te onderhou.

“Daar is ook niks gesê van belastingkortings vir gemeenskappe wat gedwing word om openbare infrastruktuur op te los of om uitgawes aan te gaan wat verband hou met die verbetering van plaasveiligheid nie, maar ons sal voortgaan om daarvoor te onderhandel.” sê Wilken.

Vrystaat Landbou (VL) verwelkom die toewysing aan die Departement van Justisie en Grondwetlike Ontwikkeling om sakeprosesse te verbeter en teen misdaad en korrupsie te beveg. “Ons vertrou dat hierdie toewysing en geregtigheid moderniserings program sal bydra tot die veilige en bevorderlike omgewing wat nodig is vir die landbousektor om in die Vrystaat en Suid-Afrika te floreer.”

Dit wil voorkom asof die minister wegbly van uiteenlopende en verdelende politieke ideologieë, maar maak dit tog duidelik dat dit nie ‘n besparingsbegroting is nie. Daar is R100 biljoen toegesê vir staatswerkskeppingsprojekte deur middel van die openbare werksprogramme en die Presidensiële Jeug-indiensnemingsinisiatief. Dit hou steeds burgers afhanklik van die staat vir indiensneming. Hy het ook gesê, buite die amptelike begrotingsskrif, met betrekking tot COVID-ondersteuningsfondse dat hy van die idee hou dat die regering aandele wil koop en nie net toelae as ‘geskenke’ uitdeel nie.

Daar is vir 1409 restitusie-eise begroot om in die begrotingsperiode te koop. Tot op hede het die regering sedert 1994 reeds meer as R200 miljard aan grondhervorming bestee. Dit kon al die grond wat in Suid-Afrika geëis is vir diegene wat wou boer en eiendom besit, koop. Tot op hede boer baie min restitusie-begunstigdes egter en bykans geen begunstigdes van grondhervorming het hul titelakte ontvang vir die eiendom waarop hulle woon en / of boer nie.

Vrystaat Landbou aanvaar die marginale toename in maatskaplike toelaes.Alhoewel die afhanklikheid van die kiesers van die staat toeneem, sal dit ook die bestedingskrag van byna ¼ van ons burgers verhoog om produkte wat deur die landbou geproduseer word te koop.

Die Landbank, net soos Eskom, SAL en ander staatsondernemings is ‘n mislukte en bankrot entiteit waarvan die doel nie meer is om lenings in die landbousektor vir ontwikkeling en groei te ondersteun nie, maar ‘n politieke mandaat van elite-opheffing en kaderontplooiing waar korrupsie hoogty vier. VL is van mening dat staatsfondse eerder gebruik word vir die subsidiëring van krediet wat aan historiese agtergeblewe individue deur die bestaande banke op grond van vryemarkbeginsels verleen word sodat almal billike en gelyke toegang tot goedkoop kapitaal om in die landbou te begin. “Ons glo nie dat die staat ‘n bank moet besit of ‘n bedryf moet monopoliseer nie weens rampspoedige politieke invloede.” sê Wilken.

“Die landbou het beslis sy waarde vir die nasionale ekonomie bewys deur sy aanpasbaarheid, ten spyte van die stryd teen die natuurlike elemente. Alhoewel dit nie in die begroting erken is nie, verwelkom ons die verlaging van die belasting op maatskappye en die kleiner verhoging van belastingskale! ” sê Wilken.