No light shed on BEE fronting on Cape farms

FOLLOWING reports of BEE fronting on farms in the Western Cape, the presidential advisory board on land has convened to discuss the issue with the Presidency.

Professor Ruth Hall of the SA Institute for Poverty, Land and Agrarian Studies at UWC and Professor Mohammad Karaan of the Agricultural Economics faculty at Stellenbosch University told the Weekend Argus BEE fronting was common at farms in the Western Cape.

The two are on the advisory board. The practice entails farmers registering farmworkers as BEE partners in order to get funding from the government.

Farmworkers say this funding is often used to service the debt of the farm and that they are not allowed access to the financials.

The practice has received the attention of the Presidency – though it is not clear who is dealing with the matter there – and the Special Investigating Unit (SIU) has confirmed to the Weekend Argus that it is looking to attach the investigation into an ongoing proclamation.

The SIU has visited farmworker representatives twice and issued a case reference number a fortnight ago, Witzenberg Rural Development Centre paralegal Naomi Betana, who works with farmworkers, confirmed this week.

Hall and Karaan told Weekend Argus they would raise the issue of equity schemes at their meeting with the Presidency.

There was no feedback from that meeting at the time of going to print.

Deputy President David Mabuza chairs the inter-ministerial task team that works with the advisory board.

Hall said the Department of Rural Development and Land Reform had not been forthcoming with policy information in relation to equity schemes.

She said the department had only shown them a draft policy document on this issue.

“When we asked for the final version, even the head of policy said they didn’t have one.

“It just seems odd that we’re selling hundreds of millions of rand on a policy programme that does not have a financial policy document, nor is there clarity about monitoring the outcomes of this programme and the impact on public investment.”

She said the land redistribution for agricultural development subsidy, in which farmworkers received over R20 000 per individual, had been stopped and replaced by the 50/50 model.

Hall said former land minister Gugile Nkwinti had introduced a new equity programme in which farmer/ farmworker shareholding would be split 50/50, but that had not worked to the benefit of the workers.

She said Nkwinti’s model poured more money into farmers’ pockets.

“There is evidence that very few people benefited ( from equity schemes).

‘This was a bad investment by the State.

The 50/50 programme is also problematic and it’s important to ask questions about the 50/50 programme,” Hall said.

Karaan said: “There are some good equity schemes, but there are many bad ones.

“They’ve been used for BEE fronting. The farm workers have little say on (how farms are run).”

Acting director-general of the land department Rendani Sadiki did not respond to queries sent to her.

Provincial department head Juanita Fortuin has not responded to two queries - including one in August - sent to her.

Equity schemes are often hailed as groundbreaking and described as another way of land reform.

That is a far- cry from reality, according to former shareholders who entered equity schemes with farmers in the greater Boland.