{"id":28212,"date":"2023-11-10T06:00:00","date_gmt":"2023-11-10T04:00:00","guid":{"rendered":"https:\/\/amabhungane.org\/?p=28212"},"modified":"2024-09-11T15:24:06","modified_gmt":"2024-09-11T15:24:06","slug":"r462m-megafarm-land-reform-project-in-disarray-after-north-west-department-fails-to-release-funding","status":"publish","type":"post","link":"https:\/\/further.co.za\/amabwp\/r462m-megafarm-land-reform-project-in-disarray-after-north-west-department-fails-to-release-funding\/","title":{"rendered":"R462m \u2018megafarm\u2019 land reform project in disarray after North West department fails to release funding"},"content":{"rendered":"\n<p class=\"wp-block-paragraph\"><em>Photographs by Magnificent Mndebele<\/em><\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\">In the lush plantation fields of Skeerpoort, situated about half an hour\u2019s drive from Brits in the North West province, lies the farming community of Khutso-Naketsi.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Sina Modise is one of its oldest members and her identity document shows her to be 115 years of age.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">She was also meant to be one of the beneficiaries of a \u2019megafarm\u2019 purchased by the North West Department of Agriculture, Land Reform and Rural Development (DALRRD) in 2019.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The land was bought as part of a land reform programme and is held under a communal property association (CPA).<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Yet the ambitious project to transfer 70 percent of a massive working vegetable farm to community control, at a cost of nearly half a billion rands, is in shambles.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Its problems highlight not only the policy and practical challenges inherent in the CPA model, but also the seeming complicity of national and provincial departments responsible for land reform, whether through incapacity, neglect or worse.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">As with many CPA\u2019s before it, the Khutso-Naketsi CPA\u2019s big problems started when, as a cumbersome legal entity in a rural and underdeveloped community, it was saddled with the need to take responsibility for multi-million rand businesses.&nbsp;&nbsp;<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In April this year the previous committee members, elected by beneficiaries like Modise to manage the farm and the CPA\u2019s other properties on their behalf, were voted out.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Like many before them, the old committee is perceived as having chosen to fatten their own wallets with little regard for the impact on Modise and other beneficiaries.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Four of the committee members of the CPA who were ousted in the elections allegedly misspent or mismanaged about R24-million from the CPA and its subsidiaries.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In addition, an irregular agreement signed by one of these former members almost saw the association lose its chief land asset and income stream.<\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"768\" src=\"https:\/\/amabhungane.org\/wp-content\/uploads\/2023\/11\/Sina-Modise-s-1024x768.jpg\" alt=\"\" class=\"wp-image-28213\" srcset=\"https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/Sina-Modise-s-1024x768.jpg 1024w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/Sina-Modise-s-600x450.jpg 600w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/Sina-Modise-s-300x225.jpg 300w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/Sina-Modise-s-768x576.jpg 768w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/Sina-Modise-s-1536x1152.jpg 1536w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/Sina-Modise-s.jpg 2000w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><figcaption class=\"wp-element-caption\">Sina Modise is 115 years old and one of the oldest Khutso-Naketsi beneficiaries.<\/figcaption><\/figure>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cThose people have made me to suffer,\u201d Modise told us while sitting on a couch in her home in Letlhabile township \u2013 almost an hour away from the land she once lived on. \u201cI have nothing to display that I am a beneficiary. We have been waiting for a long time but there is no difference.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">That perception is still a matter of dispute, but what is indisputable is that it is entirely foreseeable that placing rural community leaders in roles of significant corporate and financial authority is going to produce challenges and temptations.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Given this, it seems extraordinary that the provincial and national department did not, as far as we can tell, put in place effective checks and balances to manage a land transfer as large and complex as this one.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The response from officials to amaBhungane\u2019s attempts to elicit accountability have been met with a level of non-responsiveness or officiousness that together suggest an underlying indifference.<\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Khutso-Naketsi <\/strong><strong><\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The Khutso-Naketsi CPA is one of the country\u2019s 1 720 associations collectively holding millions of hectares of land transferred to land reform beneficiaries in the democratic era.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Its woes offer a window into the widespread dysfunction of the CPA system, which is marred by infighting, untransparent management and a lack of post-acquisition government support.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The evidence in amaBhungane\u2019s possession suggests that between 2018 and mid-2022, the CPA and its subsidiaries received at least R27-million in revenues. Yet only R2&nbsp;985 115 reached the hands of about 325 beneficiaries via a once-off payment in December 2019 that amounted to R14 500 per household.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Bank statements and financial reports that amaBhungane obtained suggest that the four former committee members tapped into the CPA\u2019s resources in problematic ways that went beyond their purview<strong>,<\/strong> a view bolstered by &nbsp;allegations of their poor performance.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The four erstwhile members allegedly appointed themselves as directors of the CPA\u2019s corporate subsidiaries, comprised of a farming joint venture created from restitution involving the previous landowner and two separate companies created in July 2020.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Their modest R3 500 committee stipends blossomed into self-determined salaries of up to R60&nbsp;000 a month per person. As a result, the employment costs of the CPA steadily rose from R493&nbsp;500 in 2018 to R2&nbsp;423&nbsp;733 in 2022.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The documents also reveal that R1,283-million was extracted via ATM withdrawals and cashed cheques, with little or no documentation to show where it went.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cWe\u2019ve asked them to break down the R24-million [internal spending]. Who did it benefit? There is no benefit to the community,\u201d said Douglas Ncube, the new chairperson of the CPA.<\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<figure class=\"wp-block-embed is-type-video is-provider-youtube wp-block-embed-youtube wp-embed-aspect-16-9 wp-has-aspect-ratio\"><div class=\"wp-block-embed__wrapper\">\n<iframe loading=\"lazy\" title=\"Conversation with Douglas Ncube\" width=\"500\" height=\"281\" src=\"https:\/\/www.youtube.com\/embed\/QG2myUjQLOg?feature=oembed\" frameborder=\"0\" allow=\"accelerometer; autoplay; clipboard-write; encrypted-media; gyroscope; picture-in-picture; web-share\" referrerpolicy=\"strict-origin-when-cross-origin\" allowfullscreen><\/iframe>\n<\/div><\/figure>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\">The CPA\u2019s two main corporate assets are Damsig Poultry <strong>\u2013<\/strong> a preexisting asset <strong>\u2013<\/strong> and Khutso-Naketsi Agri, which controls the more recently acquired mega farm in which the CPA holds 70%.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Damsig, which leases 19 chicken houses to large corporate clients, was overseen by former treasurer Thomas Selahla <strong>\u2013 <\/strong>a former Klipgat Police Station acting commander <strong>\u2013 <\/strong>and William Moroke, a former CPA committee member.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The separate 70-30 joint venture, Khutso-Naketsi Agri (KNA), was led by the CPA\u2019s former chairperson Abdullah Lucky Milanzi and Ephraim Mphamo, another member of the CPA.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Now, the new committee is faced with wresting control from the old members, who remain listed directors of Damsig and KNA, as well as trying to find out what went on and putting the businesses back on track.<\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\">R<strong>edistribution of a \u2019megafarm\u2019<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The CPA was registered as a legal entity on 15 September 2008. This is when the DALRRD restored a first land parcel to the dispossessed Khutso-Naketsi community members.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In early 2019, the Department bought an additional &#8216;megafarm&#8217; of 1 923 hectares at a cost of R462-million. This land was returned to the 325 household beneficiaries, for whom it should have been a momentous occasion of historical redress.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Any celebration was, it turned out, premature, as by 30 September of that same year the community had lost all control over the land.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The post-settlement success of the farm depended not just on the acquisition of the land and implements, but also on a capital injection agreed to by the Department, as well as the transfer of skills to manage such a labour-intensive and technically challenging project.<\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Setting up a joint venture<\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">For the purposes of skills transfer, the Department recommended that the new landowners enter into a joint venture with the previous owner, Henning Petrus Nicolaas Pretorius.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">70% of the joint venture would be held by the CPA and 30% by Pretorius, trading through his company HPN Bestuur Pty Ltd. This joint venture, KNA, was registered as a private company on 3 April 2019.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Pretorius was the obvious choice to provide mentorship at what had previously been his farm.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The joint venture was to last for five years, whereafter the community could terminate the arrangement and acquire the 30% of the shares held by HPN Bestuur or renew the management agreement.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">KNA\u2019s shareholders agreed that the company\u2019s operational costs had to be split between the CPA and HPN Bestuur based on their respective shareholdings. The CPA\u2019s R87,1-million of \u201cpost-settlement funding\u201d was supposed to come from the North West DALRRD while HPN Bestuur had to provide R26,7 million.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The joint venture was effectively a transitional structure. In a judgment stemming from subsequent litigation in the North Gauteng high court, the joint venture\u2019s purpose was framed as aiming \u201c\u2026to transfer a going concern to a new corporate governance structure without putting the on-going of the business at risk and to prevent job losses\u201d.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">There are theoretically two income streams for the CPA through the joint venture.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">First, the contract makes provision for the CPA to earn a 2% rental fee on KNA\u2019s monthly turnover. This was evidently duly paid. Then, it should receive 70% of whatever dividends the venture pays. The Khutso-Naketsi CPA has received nothing from this second income stream.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This is because the North West DALRRD failed to provide the total portion of the CPA\u2019s funding on time.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This is where the trouble began.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The shortfall of funding saw Pretorius lend money to the joint venture in the interim, with the CPA\u2019s 70% being given back to him in terms of a supposed share transfer agreement as security, pending payment by the Department.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This arrangement was highly problematic. Rather than the CPA\u2019s 70% being encumbered in the event of, and to the extent of, any default, the entire 70% was transferred back to Pretorius as security. This deal was signed by the then-chair of the CPA, Milanzi.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The scene was set for the CPA to lose its prize asset, ironically to the very person the state had bought the land from in order to restore it to the dispossessed community.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">As it turned out, this was exactly what allegedly happened, ultimately leading to an acrimonious court battle.<\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"768\" src=\"https:\/\/amabhungane.org\/wp-content\/uploads\/2023\/11\/KNA-morning-prayer-s-1024x768.jpg\" alt=\"\" class=\"wp-image-28219\" srcset=\"https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/KNA-morning-prayer-s-1024x768.jpg 1024w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/KNA-morning-prayer-s-600x450.jpg 600w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/KNA-morning-prayer-s-300x225.jpg 300w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/KNA-morning-prayer-s-768x576.jpg 768w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/KNA-morning-prayer-s-1536x1152.jpg 1536w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/KNA-morning-prayer-s.jpg 2000w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><figcaption class=\"wp-element-caption\">KNA workers are gathered at the meeting point for the morning prayer, which has been a tradition for the company culture.<\/figcaption><\/figure>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>The disastrous cost of delayed \u201cpost settlement funding\u201d<\/strong><strong><\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Milanzi concluded the share transfer agreement on 19 September 2019, on behalf of the CPA.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cAs soon as the post settlement support [from government] is available the 70% shares will be reallocated to Khutso-Naketsi CPA,\u201d reads one of the conditions in the agreement that Milanzi signed.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">It would take the North West DALRRD nearly two years to release a partial payment of R37&nbsp;969&nbsp;190, which was only paid on 1 April 2021, despite the R87,1-milion having been approved in June 2019.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This money was for additional implements worth R16&nbsp;960&nbsp;691, as well as crops on land worth 28&nbsp;000&nbsp;000, but for the latter the Department only paid what the crops were sold for on the market said Stephan Pretorius, the son of the farm owner, who now controls HPN Bestuur\u2019s 30% stake in KNA along with his brother.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">AmaBhungane understands that when Pretorius senior stepped in to fund KNA it was a contingency plan, based on the hopes that in a month or two government would have released the post-settlement funding. As a result, since KNA\u2019s inception the company has had to borrow about R20-million from Pretorius and still owes him about R8-million.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cIt was never meant to be R20-million. He was forced to continue supporting the company,\u201d said Stephan.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">On 25 May this year, the CPA argued in court that Pretorius\u2019 agreement with Milanzi giving him 100% of the company as security was void.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Acting judge of the High Court Gauteng Division, Karin Strydom, agreed, ruling that the agreement signed with Milanzi was invalid because it was not approved by a majority of heads of households in the community.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">She restored the CPA\u2019s rights as \u201cthe holder of 70% of the authorised and issued share capital in the first Respondent [KNA].\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">But what she could not restore was the money and goodwill already lost.<\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Why was the funding delayed?<\/strong><strong><\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">It has been difficult to get information out of the DALRRD, but documents obtained by amaBhungane show that post-settlement funding in the full amount of R87,1-million was approved by the chief director of the regional land claims commissioner and the North West DALRRD\u2019s Provincial shared services centre as early as June 2019.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">There appear to have been bureaucratic delays, mainly because the province wanted the funds paid into an account controlled jointly by Khutso-Naketsi Agri (the joint venture) and \u201cthe identified accountant\u201d, which apparently referred to a transaction advisor insisted on by the province.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This meant that a transaction advisor had to be appointed and that a deviation approval was required, which seems only to have happened in November 2019.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Stephan Pretorius gave us his recollection.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cWhat happened was, it was in a government meeting where\u2026 it was decided that they have not yet assigned a transitional advisor, and this is after the project had started and they assured us that once that person gets assigned the money will be released quickly. This is at the start of the company. My father said he will lend us to start everything and as soon as the transactional advisor gets appointed, [KNA will] pay back the money. When the transactional advisor came in, we already had a financial year and shown a loss.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This was around February 2020. Then, Stephan alleges, the Department changed its tune and said that \u201cit was too risky for them give the money out because they think we are going to lose the money, they need to reanalyse the business&#8221;.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">He said the Department wanted them to change their management structure to bring in another person to oversee the project.<\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>No comment<\/strong><strong><\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">AmaBhungane reached out to a number of those involved at the Department, without success.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">We also reached out to the transaction advisor, <a href=\"https:\/\/www.linkedin.com\/in\/balebetje-makua-20784b1b\/overlay\/about-this-profile\/\">Balebetje Makua<\/a>. Eventually this reporter sent an SMS to her, saying, \u201cI would really love to have a chat with you regarding your role\u2026 I am about to run out of time.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">She responded, \u201cSince you\u2019re out of time and I have none at the moment. I am no longer on the project as you know. The project is in the full custody of the department\u2026 they are very open with the challenges of the project.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">That was not our experience.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Eventually we reached Richard Keothaile, the chief director of North West DALRRD\u2019s Provincial Shared Services Centre, which renders corporate support services.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">He was one of the first officials to sign approval for the R87,1-million whose delays and partial payment seemed to have been the original cause of the joint venture\u2019s operational and legal problems.<\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<figure class=\"wp-block-embed is-type-rich is-provider-soundcloud wp-block-embed-soundcloud\"><div class=\"wp-block-embed__wrapper\">\n<iframe loading=\"lazy\" title=\"Richard Keothaile interview - 25 October 2023 by amaBhungane\" width=\"500\" height=\"400\" scrolling=\"no\" frameborder=\"no\" src=\"https:\/\/w.soundcloud.com\/player\/?visual=true&#038;url=https%3A%2F%2Fapi.soundcloud.com%2Ftracks%2F1660511028&#038;show_artwork=true&#038;maxheight=750&#038;maxwidth=500&#038;secret_token=s-vtFhlATHGpW\"><\/iframe>\n<\/div><\/figure>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\">You can listen to the full interview above, but in essence Keothaile said he would not discuss the issue with the media, only with the CPA committee.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">We tried to explain, \u201cWe have come to you guys because we&#8217;ve spoken to those people and they have allegations against you guys.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Keothaile said he was not aware of any allegations or differences between the Department and the beneficiaries. And if there were, the CPA should bring them up with the Department.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Keothaile: \u201cI will respond to the CPA itself if they raise questions and not to you specifically.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Reporter: \u201cThe very same CPA that is frustrated with you guys and it has come to the media that you guys are not doing your duties?\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Keothaile: \u201cThen refer them to us. We can discuss with them\u2026 But what you are doing of trying to get information from government and say government must just speak everything openly to any people identifying themselves to be\u2026 representing the public. Unfortunately, I won&#8217;t fall into that trap\u2026 This is private matters for Khutso Naketsi.<\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Intervention<\/strong><strong><\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Indeed, seemingly in response to amaBhungane\u2019s efforts, North West DALRRD officials held a meeting with the Khutso-Naketsi CPA committee members on 1 November 2023 in Mahikeng.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">In a recording of the meeting obtained by amaBhungane, one official, Kenneth Matukana, the director of operational management, can be heard downplaying their contribution in the post-settlement agreement. In fact, Matukana denies the existence of the agreement.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cIt was a gentlemen\u2019s agreement,\u201d said Matukana in the recording. \u201cLet me not even call it a gentlemen\u2019s agreement. We said, \u2018Pretorius, since you are the owner with\u2026experience, let us see in the five-year how can this relationship be enhanced. It is not something that is binding.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The province\u2019s own internal approvals give the lie to this claim. It is apparent that the approval of the R87,1-million was based on a detailed post-settlement plan. Now it seems the Department wants a new plan.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cI am not going to release money until there is a plan,\u201d another official, Lengane Bogatsu, the chief director of land restitution support, told those at the meeting.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">But what is not clear is who will provide this plan.<\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Leadership fallout<\/strong><strong><\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Based on documents and interviews obtained by amaBhungane, the Khutso-Naketsi CPA was beset by leadership problems. Milanzi, the former chair who signed away the CPA\u2019s 70% share to Pretorius, is accused of being part of a \u201cscheme\u201d that siphoned money from the CPA.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Milanzi and Mphamo, who became KNA board directors representing the CPA in the joint venture with Pretorius, were selected to be part of the skills transfer programme. They were required to report to the KNA farm on a daily basis.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">KNA would initially pay Milanzi and Mphamo R20&nbsp;000 each a month.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">However, according to Stephan, Milanzi informed them one day that the CPA had decided that he should earn R60&nbsp;000, while Mphamo continued to earn R20&nbsp;000.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Stephan said they initially refused the request but \u201cMilanzi, through the CPA, forced us to increase his salary to R60&nbsp;000 through the majority shareholder\u201d.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Stephan said the duo failed to meet their contractual obligations. Stephan and his father opted to freeze the duo\u2019s skills transfer money.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This allegedly led to Milanzi obtaining a monthly payment out of the account of the CPA that was presented as a \u201cloan\u201d to KNA. According to the figures that amaBhungane reconciled, the \u201cloan\u201d \u2013 which stretches from 29 June 2021 to 23 September 2022 \u2013 amounts to R932&nbsp;700.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">We sent detailed questions to Milanzi on 11 September 2023, asking him to explain the KNA loan as well as mysterious cash withdrawals from the CPA\u2019s account that totalled R1,283-million.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">He failed to respond to the questions but said that the matter was currently under investigation by the Hawks.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cAll the money was correctly accounted for,\u201d Selahla, the former treasurer, told us before his sudden death at the beginning of November. \u201cWe were sometimes forced to use the services of skilled labour which we didn\u2019t have. Most of the labour is people from other countries with no identification which then necessitated us to use proforma [invoice] to record everything that does not appear on the bank statement.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">What is clear is that both men had access to the bank accounts of the CPA as designated signatories.&nbsp; \u201cThe money used to pay stipends to the executive committee was agreed upon,\u201d Selahla told us.<\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Damsig Poultry<\/strong><strong><\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Damsig, the CPA\u2019s other corporate subsidiary, established in July 2020, is another headache for the incoming committee. Selahla, the late policeman and part-time treasurer, along with Moroke, also a former committee member, was fully responsible for its operations.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The CPA inherited 19 chicken houses with a capacity that varies from 20&nbsp;000 to 40&nbsp;000 birds. When Damsig started \u201cit was impossible [to] start running the business as there was no start-up funding,\u201d Selahla told us. \u201cThe total cash needed to start was about R3-million. We had no cash and tried for funding from the department but to no avail.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Damsig\u2019s directors turned to the shareholder, the CPA. \u201cWe went back to the beneficiary and reported the dilemma we are in; it was agreed to use some money which was needed urgently like the generator,\u201d Selahla said.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The full extent of the money that went through Damsig is not clear due to the fact that Damsig used a separate bank account from the CPA. It appears that when the erstwhile members were ousted from the CPA\u2019s committee, they failed to hand over the financial records of the company.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">One of the companies Damsig leased chicken houses to, Avon Chicken Farming, paid rent of R350&nbsp;000 per month directly into the CPA\u2019s Standard Bank account. In total the amount paid to the CPA between 15 May 2018 and 3 April 2020 was R9,1-million.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The Damsig directors couldn\u2019t do as they wished with this money as it went into the collective account.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Another renter, Daybreak Farms, paid into Damsig\u2019s own account. We managed to trace the payment requests which suggests that Daybreak Farms paid a rent of R7&nbsp;111&nbsp;490.87 to Damsig\u2019s between 21 July 2020 and 11 January 2021.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This R7,1-million, which never went to the CPA, remains unaccounted for. \u201cWhen we stopped growing for Daybreak in March 2022 we had not broken even,\u201d said Selahla.<\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"768\" src=\"https:\/\/amabhungane.org\/wp-content\/uploads\/2023\/11\/William-Moroke-s-1024x768.jpg\" alt=\"\" class=\"wp-image-28214\" srcset=\"https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/William-Moroke-s-1024x768.jpg 1024w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/William-Moroke-s-600x450.jpg 600w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/William-Moroke-s-300x225.jpg 300w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/William-Moroke-s-768x576.jpg 768w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/William-Moroke-s-1536x1152.jpg 1536w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/William-Moroke-s.jpg 2000w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><figcaption class=\"wp-element-caption\">William Moroke, one of the directors of Damsig Poultry, who was in charge of the entity along with the late Thomas Selahla. At least R7.1 million that Damsig received remains unaccounted for.<\/figcaption><\/figure>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\">Moroke said that between 2020 and April 2022 Damsig\u2019s bank accounts received on average R1,5-million every six to eight weeks. The total revenues that Damsig generated between 2020 and 2022 are estimated to be R17-million.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">We were unable to establish a breakdown of the company\u2019s expenses over the period.<\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>Khutso-Naketsi Holdings <\/strong><strong><\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">So far, what is clear is that all these newly acquired businesses failed to contribute what they should have to the community. Perhaps in a bid to manage the situation, the former committee members took a decision to set up a holding company in July 2020: Khutso-Naketsi Holdings (KNH).<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">KNH was purportedly intended to oversee the subsidiaries. However, KNH too ended up straining the finances of the CPA. The holding company\u2019s employees were paid what the current committee members felt were exorbitant and unjustified amounts.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Thathi Samuel Tau was hired as the chief executive officer. Tau was apparently entitled to a remuneration of R1,26-million per annum, including benefits such as a 13th cheque, medical aid, housing and car allowance.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Tau\u2019s employment is under dispute and a case is currently before the Commission for Conciliation, Mediation and Arbitration (CCMA).<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The new Khutso-Naketsi CPA committee has questioned Tau\u2019s status. In a submission to the CCMA they claimed that he \u201cwas involved in a scheme with erstwhile committee [members]\u2026 disguised as employment\u2026To date it is unknown what the applicant was appointed to do and what his duties and responsibilities are\u201d.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Tau told amaBhungane that his duties were to ensure that there was compliance among the subsidiaries and the CPA regarding annual returns and audits; to enable good governance; negotiate for business, network and get some stakeholders to grow the business; safeguard the property of the CPA from legal disputes that could potentially result in the CPA losing its land and lastly, control dividends so that beneficiaries would receive what was due to them.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Tau told amaBhungane that the re-audit by the accountancy and auditing firm, whose reports were not out at the time, would clear his name.<\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>CPA\u2019s have potential but\u2026<\/strong><strong><\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Khutso-Naketsi is just one of the many CPA\u2019s that have a potential to radically improve the livelihoods of beneficiaries. But this seemingly is not the case.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Khutso-Naketsi is another CPA whose land was purchased through the public purse for historical injustices.So far, it has failed to deliver its objectives due to the alleged misuse of monies and infighting. This has become a common story for CPA\u2019s, largely due to DALRRD\u2019s failure to administer and support them.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The CPA model was created in 1994 as the primary vehicle for land reform. As of 2022, there are 1 720 CPA\u2019s across the country, comprising millions of hectares of land.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">However, only 23% of these CPA\u2019s are, according to DALRRD\u2019s 2021-2022 annual report, compliant with the required standards.. Two-thirds of the country\u2019s CPA\u2019s are non-compliant and 1 in 10 will never be compliant.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cIt is clear that many of them are dysfunctional,\u201d said Professor Ruth Hall, the director of the Institute for Poverty, Land and Agrarian Studies (PLAAS) at the University of the Western Cape. \u201cIn abstract the CPA model is a very powerful model but only if it is for holding land and not to run a business. Secondly, if they are adequately set up.\u201d<\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"618\" src=\"https:\/\/amabhungane.org\/wp-content\/uploads\/2023\/11\/KNA-workers-s-1024x618.jpg\" alt=\"\" class=\"wp-image-28220\" srcset=\"https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/KNA-workers-s-1024x618.jpg 1024w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/KNA-workers-s-600x362.jpg 600w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/KNA-workers-s-300x181.jpg 300w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/KNA-workers-s-768x464.jpg 768w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/KNA-workers-s-1536x928.jpg 1536w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/KNA-workers-s.jpg 2000w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><figcaption class=\"wp-element-caption\">KNA farm workers on the field tendering vegetables.<\/figcaption><\/figure>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<p class=\"wp-block-paragraph\"><strong>No political will to support CPA\u2019s <\/strong><strong><\/strong><\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The power of CPA\u2019s is that they obligate the state to provide the beneficiaries with additional support and in doing so break down the division of state and private land, noted Hall.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">The DALRRD minister is meant to ensure that every CPA has its finances audited and that annual general meetings are held. One of the difficulties is that when CPA\u2019s were established, said Hall, DALRRD massively underestimated the programme.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">\u201cWhat officials would say to me is that the problem with the CPA model is that you can never finish a project cycle. You are always called back, and officials want to go on to create new projects,\u201d Hall said. \u201cIn fact, the very institution that is meant to be responsible for them, successive senior officials and ministers have said, \u2018We do not support the CPA model.\u2019\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">But the Department denied this allegation, saying, \u201cThe Department continuously supports CPAs and there are targets in the Department Annual Performance Plan and the quarterly reports and Annual performance reports are provided. The Department is not aware of the allegations that the officials dislike CPAs.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Nolundi Luwaya, a researcher at the Land and Accountability Research Centre (LARC) at the University of Cape Town echoes Hall\u2019s sentiments: \u201cThe other part of the failure rests squarely in the present, in this ministry and those who have preceded it. They have failed to provide adequate support to CPAs.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Luwaya added that once DALRRD has restored land to the community via the CPA model, there seems to be a perception that everything will automatically move smoothly. As a result, the department\u2019s ability to provide ongoing support \u201chas been problematic.\u201d<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">This observation resonates with the Khutso-Naketsi CPA.<\/p>\n\n\n\n<p class=\"wp-block-paragraph\">Its shortfalls are a double-edged sword for the beneficiaries for whom lands is bought, yet who never reap the benefits, as well as for the country, as these farms are purchased at market value yet the Department fails to provide support or administer CPA\u2019s. Thus the beneficiaries are robbed of improved livelihoods. Khutso-Naketsi is just a drop in the ocean \u2013 a story of one of many CPA\u2019s in the country whose millions of hectares of land are lying fallow and without support.<\/p>\n\n\n\n<div style=\"height:20px\" aria-hidden=\"true\" class=\"wp-block-spacer\"><\/div>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" width=\"1024\" height=\"624\" src=\"https:\/\/amabhungane.org\/wp-content\/uploads\/2023\/11\/Khutso-Naketsi-financial-briefing-meeting-s-1024x624.jpg\" alt=\"\" class=\"wp-image-28216\" srcset=\"https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/Khutso-Naketsi-financial-briefing-meeting-s-1024x624.jpg 1024w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/Khutso-Naketsi-financial-briefing-meeting-s-600x365.jpg 600w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/Khutso-Naketsi-financial-briefing-meeting-s-300x183.jpg 300w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/Khutso-Naketsi-financial-briefing-meeting-s-768x468.jpg 768w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/Khutso-Naketsi-financial-briefing-meeting-s-1536x935.jpg 1536w, https:\/\/further.co.za\/amabwp\/wp-content\/uploads\/2023\/11\/Khutso-Naketsi-financial-briefing-meeting-s.jpg 2000w\" sizes=\"auto, (max-width: 1024px) 100vw, 1024px\" \/><figcaption class=\"wp-element-caption\">The committee called for a special meeting on 5 November 2023 to brief the community about the auditor&#8217;s report on the financial mismanagement by the previous committee members.<\/figcaption><\/figure>\n","protected":false},"excerpt":{"rendered":"<p>Photographs by Magnificent Mndebele In the lush plantation fields of Skeerpoort, situated about half an hour\u2019s drive from Brits in the North West province, lies the farming community of Khutso-Naketsi. Sina Modise is one of its oldest members and her&#8230;<\/p>\n","protected":false},"author":10,"featured_media":28215,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[2],"tags":[],"class_list":["post-28212","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-stories"],"acf":[],"_links":{"self":[{"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/posts\/28212","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/comments?post=28212"}],"version-history":[{"count":1,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/posts\/28212\/revisions"}],"predecessor-version":[{"id":29795,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/posts\/28212\/revisions\/29795"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/media\/28215"}],"wp:attachment":[{"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/media?parent=28212"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/categories?post=28212"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/further.co.za\/amabwp\/wp-json\/wp\/v2\/tags?post=28212"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}