In its submission to the committee that facilitates negotiations on black economic empowerment (BEE), Agri South Africa on Monday stated that its members support the objectives of BEE and are already promoting it in practice by means of various programmes, but that the organisation differs essentially with official BEE proposals that were published last year for comment.
Agri SA on Monday released its views on BEE, as contained in its submission to the committee that facilitates negotiations, for the public’s information.
Agri SA said the official BEE document, and especially its targets and figures relating to land reform, has given rise to considerable uncertainty and debate.
The organisation added that it believes that the Strategic Plan for Agriculture, which the organisation negotiated with the government and emerging agriculture in 2001, should serve as the basis for BEE in agriculture, which must, within the current consultation and negotiation process, be fleshed out to provide more detail.
Agri SA noted that its views on BEE represent a culmination of the inputs provided by its members, via nine provincial agricultural unions, 28 commodity organisations and the Agricultural Business Chamber.
Whereas farmers and agribusinesses are the ones that will ultimately deal with the practice and implications of BEE in agriculture, Agri SA could not adopt a viewpoint on their behalf without informing and consulting with them extensively in this regard.
The diversity of agriculture is also reflected in the diverse inputs that Agri SA had to consider during the consultation process, the organisation said.
In its submission, Agri SA said that it refers specifically to the family and small-business nature of commercial farming, which must be taken into account with regard to BEE, especially in terms of land redistribution, shareholding and participation in management.
Agri SA believes that the viability of a very large percentage of farming operations could be negatively affected if the official proposals are rigidly applied to individual farming operations.
Constitutional rights
In its submission, Agri SA also pointed out that the constitutional rights of farmers in terms of private ownership, freedom of economic activity and of association should be accommodated within any proposal of BEE in agriculture.
The organisation is of the opinion that sustainable BEE in agriculture can best be served by means of appropriate information, support, incentives and recognition.
“Such an approach should make provision for the diverse conditions at grassroots level and the differences in potential of individual farming operations to participate in empowerment actions. In this way, Agri SA believes, a market environment can be created that could promote BEE in a meaningful way.”
Agri SA said that its support for market principles is also reflected in its view on land reform.
The organisation said sufficient land is available for redistribution, but inadequate funding is the main problem undermining progress in this regard.
Agri SA therefore advocates more comprehensive state-funded programmes for land reform, as well as a sunset clause to bring an end to state involvement in the land market.
“Furthermore, private-sector support for farmer development should receive attention in a more structured manner. Agri SA proposes that this be achieved by means of a partnership approach at local, provincial and national level between government, organised agriculture and the agricultural business environment, within the framework of forums to be established for this purpose.”
Incentives
According to Agri SA, incentives motivating farmers to participate in education and training efforts would be far more productive than actions to compel them to take over this function, which is essentially the government’s responsibility.
“In addition, Agri SA refers to a range of functions such as housing, health care, share farming, et cetera that are already undertaken by farmers and which should be recognised accordingly. Agri SA also supports preferential procurement of inputs from empowerment companies on condition that this makes economic sense.”
In its submission, Agri SA also refers to the problems relating to a generally applicable scorecard for agriculture whereby participation in BEE in agriculture can be measured.
“The small-business character of farming operations, and their potential to be measured in terms of predetermined criteria, creates particular challenges in this regard, which warrant further debate. Against this background, Agri SA is working with organised business in general to negotiate with the government a more acceptable dispensation for small businesses.”
Agri SA said that it is also of the opinion that BEE will be impossible in the sector unless the policy environment makes it possible for commercial agriculture to function profitably.
Agri SA has asked that a scorecard be kept to measure progress made with the priorities of the Strategic Plan for Agriculture, so that the viability of the BEE in agriculture initiative can flow forth from this. — I-Net Bridge