Since 2004, the land redistribution programme has been realised but not to the fullest; however, the current statements from the Land Bank regarding farms to be attached cannot go unchallenged. Pre 1994, the Land Bank used to give grants and not loans to white farmers, thus, ensuring that they thrive in the market, even during the most difficult times. Ever since, the Land Bank has defocused from the developmental to the commercial institution, which we believe is not core to its mandate. It is incorrect for the Land Bank to conduct its business like loan sharks (mashonisa).
The mandate also requires the bank to ensure that resource poor farmers would become active participants in mainstream commercial agriculture. Following the Strauss commission’s report into rural finance published in 1997, government entrusted Land Bank with a mandate to deracialise the country’s agricultural sector. The commission recommended that Land Bank should focus on promoting and facilitating access to finance to these resource-poor farmers while continuing to service commercial farmers.
Land prices remained a serious challenge since 1996 when government started purchasing land from commercial farmers to give to black people. Prices of land began to escalate, and the majority of people could not afford to raise enough own contribution that could enable them to acquire enough grant that could make up the asking price of the land. Partnerships had to be forged with the Land Bank in particular to make loans available to complement the amount of own contribution, by so doing increasing the Land Redistribution for Agricultural Development (LRAD) grant.
Some of the projects started to experience serious problems when they could not meet their contractual obligations to repay their loans. The loan amounts have since doubled due to accrued interests and this had put most of these projects in the red and on the bad books of the Land Bank.
As the department, we will assist the farmers to develop a detailed and implementable production, management and marketing plans for each farm and provide necessary assistance in terms of the required infrastructure, production inputs and training. This will be under a strict scrutiny, supervision and monitoring by the department with constant reporting to Land Bank. We will also make funding available as an intervention to assist these farms to turn around so that can be able to repay the Land Bank debt.
Enquiries:
Ali Diteme
Tel: 053 838 9106
Fax: 053 832 4328
Cell: 082 547 8385
Issued by: Department of Agriculture, Land Reform and Rural Development, Northern Cape Provincial Government
21 July 2009
