Massive export harvests worth millions of rand are going to waste on "redistributed" farms in Levubu.

The "badly handled Levubu land redistribution case" was used at the recent provincial agricultural indaba in Polokwane as a striking example of what can go wrong when private ownership of land is placed in jeopardy. The disaster in Zimbabwe is another such example.

The adverse consequences of government interference and clumsy, ideologically inspired handling of land and agrarian reform was highlighted in a discussion document by the TAU SA North.

At the Provincial Department of Agriculture’s Indaba on June 28, on the Agricultural Sector’s Declining Contribution to the Gross Domestic Product (GDP) in Limpopo, the TAU SA North rendered input on the various factors responsible for this decline. Referring to the Levubu scenario, it was indicated that farm income in Levubu dropped by R50 million, from R500 million prior to 2000 to R450 million in the 2006/2007 financial year and is still declining further. Exports alone nose-dived from R200 million per annum to R140 million, and in the same period, the number of seasonally employed people declined from 10 000 to 7 000 and those in permanent employ declined from 8 000 to 6 000. The once-thriving Levubu community has been reduced within the span of a couple of years to a community struggling to survive as a result of the economic impact of land reform, according to the TAU document.

Mr Stephen Hoffman, chairperson of the Economic Committee of TAU SA North, noted government interference in the vital private ownership, employment and the cost of business as factors in this drastic decline.

He said private ownership is one of the cornerstones of economic growth and vital for development. The lack of performance elsewhere in Africa is proof of this. Recipients of land must receive title deeds to ensure access to finance. Recipients of farmland must be obliged to invest at least 20% of purchase value in the land to ensure ownership and responsibility. Each farm must have an ultimate responsible person.

About employment he said that labour is a commodity, just like any other input cost. Cost of labour should not exceed 30% of the turnover. Farmers have no control over the price of labour because of government interference. Cost of labour increased to a point where it is losing its attractiveness regarding productivity against cost, resulting in a shift of preference towards mechanization. Labour is not necessarily reduced intentionally, but rather phased out on the basis of natural turnover.

Hoffman emphasised that agriculture is not a get-rich-quickly enterprise. The very low profit margins, ranging from 1% to 6%, coupled with a high-risk production environment, makes agriculture a profession in which only the strongest will survive.

The Chairperson of TAU SA North, Mr Dries Joubert, acknowledged the attempt by the provincial Department of Agriculture to find solutions to the dwindling contribution of agriculture to the GDP of Limpopo. He said it is of vital importance that honest, open discussion be held, especially on the consequences of so-called land and agrarian reform. He said he was impressed with the quality of the speakers at the Indaba and expressed the hope that this will be the beginning of the discussion on the economic viability of agriculture. He said TAU SA North will participate and will continue to state the true face of sound economic development against ideologically inspired, unworkable models so clearly visible in the rest of Africa.

Joubert says it would be in the national interest if government could investigate private ownership as an instrument of development and growth instead of destroying private ownership of land and transferring ownership of all land into the hands of the government, under the guise of land redistribution.

"Private ownership is in fact one of the most effective ways to reach the aim of poverty alleviation, distribution of economic assets and the creation of wealth," he said.