Ron Jenkinson, a farmer in KwaZulu-Natal, popped R24-million into his bank account and walked away from his 250 hectare sugar cane and timber farm because he had sold it to the Department of Rural Development and Land Reform.
Paddy Hartdegen writes a regular column for Property24.com
The farm, Jengro Estates, had been on the market for several years and he had apparently set his price and when the department agreed to pay it the deal was duly signed and sealed. He left the farm and set about doing something else instead.
And a 23-year-old young black farmer, Noah Nyawo, head of the Ikusasa Lethu Youth in Agriculture Project took over the farm and is leasing it from the government for R167k a year.
He says that the department had told representatives of Ikusasa to look for a suitable farm and they chose Jengro Estates. They now have the task of keeping the farm productive and making sure that it provides a profit from the sugar cane and the timber growing on the land.
In a separate development at the end of May this year, Eastern Cape food producer, Sovereign Foods sold its R42-million state-of-the-art broiler farm to Simile Farmers’ Trust. The company maintained a share in the venture, in partnership with the Land Bank and the Eastern Cape Agriculture and Rural Development Department.
Sovereign not only sold its farm, but maintained a share in it and assisted Simile with setting up the agricultural infrastructure and has set about empowering the members of Simile with the necessary farming and enterprise skills.
Moreover, as strategic partners, the Land Bank and the two provincial departments say they will support the project at various levels from management and financial support to technical and agricultural support.
Spot the difference between these two deals.
One is aimed at ensuring sustainability; the other is a best-guess scenario.
Now I am not saying that a 23-year-old is incapable of being a successful farmer. There are just too many success stories of 23-year-olds all over the world who have done phenomenal things and I do hope that Nyawo is one of them.
What I do know is that more than 90% of the farms, bought under the government’s land reform programme over the years, have failed. I do know that the beneficiaries of these farms have all blamed the government for a lack of technical, management and financial support for their failure.
We need to build a strong farming base in South Africa to meet our future food requirements and to ensure that we can create wealth, stimulate employment and improve the living conditions of farm workers in South Africa who are among the most marginalised of all workers in the country.
We also accept that there has to be a more equitable stake in land ownership for all South Africans and this applies as much to the farming community as it does to the un-housed masses living in shanty-towns alongside our highways.
But is the Department of Rural Development and Land Affairs going about its business in the best possible interests of sustainable development. I have grave doubts about this, not because their intentions are not well placed but because the mechanisms being used are simply useless.
You cannot tell me that farming is instinctively bred into each and every one of us. Just because you or I might have grown up on a farm and seen the day-to-day activities that take place there doesn’t make us farmers, does it?
There is a considerable amount of knowledge, expertise, skill, training and ability that is required to make any farming venture a success. Just because a farm might have been bought as a going concern doesn’t mean, for one second, that two years from now it will still be a going concern.
And the legacy of 90% of the farms bought that have failed is testimony to this fact.
On the other hand, when a farm is sold but the farmer and his workers remain part of the day-to-day running of that farm then there is a real chance of success and that’s why the deal that Sovereign has done with Simile represents so much more of a step in the right direction for the future of farming in South Africa.
And Sovereign’s deal is by no means the only venture of its type in the country. In fact, earlier this year a wine farm in the Western Cape was converted in such a way that workers became shareholders in the venture so that they could use their profits from the farm to build wealth for themselves and then acquire land individually if they chose to.
Some time ago former employees of Pioneer Foods signed a R24-million deal to buy the group’s successful Nulaid Winterton plant. Employees immediately took over control of the 322,5 hectare plant with ten fully-automated chicken houses, about 40 000 hens and an egg packing station.
Other farms that were sold to employees include Hi-Rise, Calderwood, Klipdrift, JR, Lisbon and Kaalfontein in Gauteng; Thorn Hill, Protea Eggland and Dell in the Eastern Cape; Charwill, Paardeberg, Hazeley, Blompot, Lemoenkloof, Philadelphia, Klipvlei and Uitsig in the Western Cape.
What has happened to these farms?
Are they still being run as successful ventures and are they sustainable farming ventures that will see employees getting wealthier and production levels rising. One wonders? And, I suppose, only time will tell.
But what really is fundamental to all these land deals and cleverly-structured sales agreements with workers, farmers, land recipients and other beneficiaries is that there must be some level of investment maintained by the person or group that is selling the farm.
I would like to see structured deals that ensure the full payment for the farm is only received once the workers have turned it into a successful venture and have proven that they are capable of keeping a farm running as a commercial enterprise.
Otherwise all we are doing is putting a lot of money into land reform that will, over time, be wasted and our farms will become run-down tracts of fallow land producing nothing and representing nothing more than a huge liability for their owners.
That has already happened in 90% of the previous land reform deals and that’s the real travesty facing our farming community.
Let’s hope that the farmers who have benefited from these deals will be successful. That they will be really good for the country and that there are no more failed farms to look back on with despair.
*Hartdegen writes a regular column for Property24.com. The content of his columns constitutes his personal opinion and doesn’t pretend to be facts or advice. Contact him at viaemail.
Readers' Comments Have a comment about this article?Email us now.
A good article and quite simply this is problem that plagues all level of business and reform across South Africa, the 15 years transition in BEE has crippled this country as it was not a realistic model, people were thrust in positions without mentorship and supporting structures and businesses were made available without sustainable implemention strategies and realistic outcomes.
Corruption at all levels of government has further hampered our development and the Land Bank would be a perfect example of this. We have to work past policy and focus entirely on implementation and sustainability, the land form, BEE and all these other methods to distribute some wealth and ownership must be in place, but likewise that those persons inheriting or in the enviable position to be positioned in corporate or government need to understand that this process is not going to continue forever and the glass does empty if not refilled by hard work and receprocity.
The perception that all persons have been given social standing without hard work and hard times is unjust and the argument will further sideline and slide us back to pre 1994.
The "disease" that it is easy to take without contribution only will make our lives unbearable in the future and don't kid yourself the gap between rich and poor will only be greater than it is now, so don't preach climb into the trenches and make a difference. - Lawrence
Print
