The Challenge of Sustainable Rural Development: A Case Study from the Eastern Cape By Professor Gilingwe Mayende Directo

1. The Challenge of Sustainable Rural Development: A Case Study from the Eastern Cape By Professor Gilingwe Mayende Director, MayeCon Consulting and University of Fort Hare 1 September 2010 1

2. Table of contents A brief historical sketch The current situation: Mhlontlo case study Government�s response 1: the ISRDP Government�s response 2: the CRDP Some key emerging challenges of the CRDP Key determinants of sustainability 2

3. A brief historical sketch Land dispossession By 1900 previously prosperous African agricultural production had been destroyed Exacerbated by the deleterious effects of the1913 Native Land Act and subsequent �group areas� legislation By 1936, Africans had access to only 13% of the land lots reduced to 1.5 hectares per household on average Rapid increases in population went hand in hand with regression to sub-subsistence levels Wage migrant labour and establishment of labour reserves Poverty deepened to such an extent by the 1970s around 70 per cent of the homeland populations lived below the poverty line 3

4. A brief historical sketch (Ctd) �Betterment� schemes in the 1940s and 50s Continued into the era of so-called �homeland independence� Agricultural production continued its downward slide into the 1980s �Homeland� governments began a trend of using parastatal institutions to provide agricultural services like TRACOR in the former Transkei and ULIMOCOR in the Ciskei The parastatals acted as �agricultural entrepreneurs�, engaging in actual productive activities while the people were largely non involved Envisaged emergence of �serious� and �progressive� African farmers never materialised 4

5. The current situation: Mhlontlo case study Mhlontlo Local Municipality is one of 7 that form part of OR Tambo District Municipality Physical characteristics similar with rest of former Transkei territory in terms of soil quality, climate, rainfall patterns, etc � exception is southernmost part known as Pondoland Demographically the area also fits the usual pattern of overcrowding, high infant mortality rates, low adult life expectancy and high rates of migration to towns and cities Almost totally cut-off from the mainstream of the country�s economy except through labour migration and remittances 5

6. The current situation: Mhlontlo case study (Ctd) Mhlontlo LM declared a pilot site for the Comprehensive Rural Development Programme by the EC Provincial government in June 2008 Research conducted in the area by the presenter in August 2009 � March 2010 Similar processes of land dispossession as in most of SA, culminated in the 1860s with Amampondomise losing large tracts of in the relatively large farmign area that incorpotates the towns of Maclear (Nqanqaru), Ugie (Inxu) and Elliot (Untunjinkala) 6

7. The current situation: Mhlontlo case study (Ctd) Empirical data collection included a baseline household survey of a sample of 800 households in ten villages out of a total of 34 000 Mhlontlo�s IDP shows the area as having a population of 197 723 of whom 99% are Africans Unemployment is at 87.4% against a provincial aggregate of 44.7% and a national figure of 38.6% 60% have no access to clean drinking water, and 68.7% do not have electricity Proportion of households receiving old age grants is 48%, child support grants 6.25%, and disability grants 11.88% Data on distribution of arable land in the area also shows the average plot being 1.5 hectares 7

8. The current situation: Mhlontlo case study (Ctd) The region is lagging far behind others on the EC, with proportion of households living in poverty as high as 82% as against a provincial aggregate of 67.4% Proportion of households having access to basic services is 16.6% against a provincial aggregate of 43.3% The literacy rate is only 49.1% compared to a provincial aggregate of 63.5% Rural-urban migration continues to be high, with 51.4% of households having at least one member who has migrated Significantly, oscillatory migration has been diminishing, with increasing numbers opting to base themselves permanently in the towns or cities 8

9. The current situation: Mhlontlo case study (Ctd) Data on wages and income show severe deprivation as only 13% of the households in the sample indicated having any source of income, with 86.98% having no income Only 24.41% received remittances, which suggests the diminishing importance of this source of supplementary income � compared to the high of 70% in the 1970s Only 1.75% of the households in the sample sell any crops While 13.6% received food parcels, 82.7% indicated that they requested food from neighbours occasionally and 10.7 per cent on a weekly basis In the sample, 64% reported that they were engaged in arable production on a regular basis, with 62% planting maize as the main crop 9

10. The current situation: Mhlontlo case study (Ctd) Only 38% owned cattle (5 on average), 36% sheep and 25.75% goats Interestingly, 59% of the sample households wanted to become surplus-producing smallholders, whilst another survey (conducted by the Agricultural and Rural Development Institute at the University of Fort Hare) found that only 15% of rural households in the Eastern Cape want to engage in agricultural production An examination of the list of priorities highlighted by the survey respondents also provides interesting findings, with their order of preference being: income, ability to feed oneself, health facilities, educational facilities, good roads, and starting a business 10

11. The current situation: Mhlontlo case study (Ctd) 11

12. Government�s response 1: The ISRDP � 2001-2008 ISRDP was adopted in 2000 and launched hastily thereafter To be implemented in 21 rural nodes with the URP in 8 nodes In his 2001 State of the Nation Address (SNA) the then President Thabo Mbeki said: �Our central aim is to conduct a sustained campaign against rural poverty and underdevelopment, bringing in the resources of all three spheres of government in a co-ordinated manner� However, the programme saw little success 12

13. Government�s response 1: The ISRDP � 2001-2008 Policy gurus in the Presidency were at the same time ramming through the urban-biased Spatial Development Initiative, which saw development as being driven by urban-based investment, with rigidly set parameters of �people and not places� In practice, ISRDP turned out to be neither integrated, nor sustainable, nor was it any real sense a rural development programme as it was vaguely defined, inadequately financed, poorly implemented and weakly co-ordinated No proper technical and management capacity at DPLG which was given the task of �co-ordinating� the programme IDT was brought in but faced major operational constraints No surplus funds among the government departments to take ISRDP programmes 13

14. Government�s response 1: The ISRDP � 2001-2008 The ISRDP thus became a programme for any activity that took place in the rural areas With most departments lacking the capacity to implement it, the ISRDP featured in most of their plans for compliance purposes ISRDP also lacked detailed formulation and a research basis, as illustrated by the fact that a large number of agricultural projects had no reliable water supply, veterinary support, nor access to markets System of �encouraging� beneficiaries of the projects to pool their resources and work together failed as in many instances the groups disbanded, with individual members withdrawing because of lack of material benefit 14

15. Government�s response 2: The CRDP � since 2009 A central feature of the emerging strategy on rural development in SA is its almost exclusive focus on the former homelands Paradoxically these areas are seen as having an intrinsic capacity to provide a basis for a thoroughgoing agrarian transformation process that could lead to eradication of poverty and the creation of �vibrant and sustainable communities� A �fundamental shift in direction� came with the announcement of the CRDP by President Jacob Zuma in his SNA in which rural development was highlighted as one of five priorities of his new government 15

16. Government�s response 2: The CRDP � since 2009 (Ctd) The government�s position on rural development derived directly from the relevant resolutions of the ANC�s 2007 Polokwane National Conference CRDP highlights the lead role to be played by agrarian transformation as a central platform for rural development and as a springboard towards other productive processes, including spin-offs in rural manufacturing, particularly agro-processing, as well as a range of non-agricultural activities CRDP�s major objective is the establishment of �vibrant and sustainable rural communities� characterised by access to productive assets, employment opportunities, etc 16

17. Government�s response 2: The CRDP � since 2009 (Ctd) Significant reduction in rural poverty and attainment of high levels of food security are two key objectives CRDP also seeks to attain empowerment of women, youth, persons with disabilities, and the unemployed Promotion of the establishment of business initiatives, rural agro-industries, co-operatives and a vibrant local market Strengthening of rural livelihoods through access to and use of land and other necessary assets Fostering of production not only for household consumption but also for the market 17

18. Government�s response 2: The CRDP � since 2009 (Ctd) Strategic investment in infrastructure for the benefit of entire rural communities and not only those involved in agricultural production Social mobilisation through the establishment of social clubs and co-operatives for economic activities, wealth creation and productive use of assets Linking of agrarian transformation to land reform for the purpose of accelerating access to land in relevant cases, strengthening tenure security and speedy processing of outstanding restitution claims � mostly a regurgitation of existing plans 18

19. Government�s response 2: The CRDP � since 2009 (Ctd) Establishment of relevant co-ordination and implementation structures CRDP governance structures � more of the same, little innovation Department of Rural Development and Land Reform Strategic partners: Relevant govt departments, DBSA, IDT, NGOs, Land Bank, Commercial banks, etc Council of Stakeholders (COS) CRDP Technical Committee Households: co-operatives and enterprises; groups of 20 households 19

20. Some key emerging challenges of the CRDP Lack of funds and an effective funding model No empowerment model for communities by encouraging them to establish their own organisations that should drive their development from below The approach of utilising only formal structures such as municipal wards and traditional councils is problematic Delivery mechanisms lack innovation and assume a balanced equation in terms of the configuration of role players at the local level, yet there is considerable tension between traditional authorities and elected councils, whilst communities are organisationally weak and therefore marginalised 20

21. Some key emerging challenges of the CRDP (Ctd) Methodologically, the research approach of the programme based on �pilot studies� has a number of flaws, e.g. The pilot site is determined politically and chosen arbitrarily because it supposedly exhibits certain characteristics that are identified beforehand � similar to ISRDP Work done within a pilot study area takes place under ideal conditions, which gives the information gathering exercise a highly subjective character The piloting exercise is also a concentrated effort, characterised by the disproportionate deployment of resources, including senior government officials who pay repeated extended visits 21

22. Some key emerging challenges of the CRDP (Ctd) �Lessons� derived from the Giyani pilot are not necessarily replicable elsewhere; e.g. provision of 231 houses will not easily be replicated in the 161 wards in the area let alone the thousands of rural villages throughout the country Institutional, management and technical capacity issues have not been addressed effectively Leveraging of strategic partnerships to enhance technical capacity has not been done effectively � with a few exceptions such as DBSA Design challenge: programme designed largely as a subsistence model Access to finance for programme beneficiaries has not been clarified 22

23. Some key emerging challenges of the CRDP (Ctd) No clarity as to whether the CRDP is based on a grant (handout) or subsidy model The model seems to falling into the trap of the pitfalls of the ISRDP in terms of the group-based approach Misunderstanding of what agrarian transformation should entail Agrarian transformation may be defined as referring to �measures aimed at achieving equity�, optimum utilisation of land, and in relevant instances its redistribution, �for the primary purpose of transforming, re-organising and enhancing the agricultural production process. It also refers to a process of engendering of a more comprehensive and demographically representative spread in the distribution of social and economic benefits from the agrarian economy� (Mayende, 2010: 58). An additional benefit of agrarian transformation is that it enhances the process of social cohesion among communities as well as the dignity of households and individuals. 23

24. Some key emerging challenges of the CRDP (Ctd) While it makes reference to non-agricultural interventions, the CRDP has hardly any links with the SMME development work being done by the DTI and SEDA, and the Dept of Public Works� EPWP CRDP is also vague on how agro-cessing would be introduced, and how funding for it would be mobilised, including private sector investment DRDLR facing extreme difficulty in mobilising partners within govt for provision of social and productive infrastructure CRDP lacks an effective empowerment model that would ensure that communities develop the skills and capacity that are required through effective training and capacity-building The section on co-operatives in the CRDP framework document is very weak and lacks a clear vision 24

25. Key determinants of sustainability The most important factor in rural development is the development of the income-generating capacity of households Mobilising funding from various sources, including the private sector underpinned by a clear investment model Innovative governance 1 � encouraging communities to establish their own structures and not rely solely on government and tradition structures � to place communities in the loop organisationally � may develop into effective social movements Innovative governance 2 � establishing a legal framework that mandates DRDLR to co-ordinate rural development programmes 25

26. Key determinants of sustainability (Ctd) Locally-based planning should not be informed by a one size fits all approach � each locality has its unique features Technical capacity needs to be mobilised more aggressively through leveraging of strong strategic partnerships Co-operatives should be located at the centre of rural development modelling as they would serve as the key drivers of socio-economic development Autonomy, self-help, peer-monitoring and innovation are key propellants of co-operatives A lot of experience in this regard can be derived from Africa and other continents With the exception of China where the CCP is the sole organisational form, social movements are playing a key role in propelling rural development in emerging markets 26

27. Key determinants of sustainability (Ctd) To move away from culture of entitlement through handouts, a subsidy based funding model for programme beneficiaries is essential but it must go hand in hand with an �own contribution� component ala LRAD Households/communities must also take risk Major focus of resources should be put on extension services to support productive activities of co-operatives Training should move away from the classroom-based type towards more interactive approaches such as Paolo Freire�s Dialogical Approach Research backing for the CRDP is essential Urgency is important but it must not be at the expense of thoroughness 27

28. THANK YOU 28