The impact of recapitalization and development program on the performance of land reform farmers in the province of KwaZulu-Natal.

Abstract

Land reform is and has been one of the South African development initiatives. The desire to see agriculture as the core of the transformation for the previously disadvantaged citizens and as a vehicle for improving the socio-economic status and rural economy cannot be ignored. Research on land settlement operation across countries that have experienced land reform indicates that land reform without post-settlement support regardless of the historical background of the proposed beneficiaries or even political appraisal leads to the neglect of the awarded land. The presence of effective farmer support services promotes the development of the land reform farms whilst the opposite may contribute negatively to on-farm development and affect the livelihoods and food security of the people that rely on the farm. There is no doubt that the current land ownership patterns are unsustainable and are a threat to national democracy. Therefore, the need to provide appropriate post-settlement support to farmers’ farms cannot be ignored to help the few farmers retain the farms. It is for this reason that the recapitalization program was initiated. This study aims to determine the impact of recapitalization and development on the performance of land reform farmers. The study made use of a quantitative approach and adopted the multistage sampling techniques: stratified random sampling and random sampling procedure to select the land reform farmers that participated in the study (n =264). Descriptive statistics were used to assess the socio-economic status of the land reform beneficiaries. Econometric analysis was also used through Probit regression analysis to assess the factors influencing the participation of farmers in the Recapitalization and Development Program (RADP), and the Endogenous switching regression model to assess the impact of RADP on the performance of land reform farmers. The primary findings indicated that respondents are on average 49 years old and that around 80% of the sampled farmers are married. While approximately 64% of farmers engaged in nonfarm economic activity, the average household has approximately five people. Similarly, the number of years spent cultivating crops (a proxy for experience) is projected to have a favourable effect on participation in the RADP and on net farm revenue. Around 70% of respondents reported having a signed contract. These findings indicated that while 58% had access to extension services from both the private and public sector contributing to the progress of agricultural development with 54% of strategic partnership support, and mentorship was

indicated to be 44%. Tax compliance (p=0.022), secondary organization (p=0.0257, legal entity (p=0.008), farm potential income upon acquisition (p=0.084), farmers getting third-party support (p=0.071), and strategic partnership (p=0.081) all had a statistically significant effect on farmers' RADP participation. The findings indicated that age (p=0.029), farm potential income upon acquisition (p=0.088), strategic partnership (p=0.049), and tax compliance (p=0.002) were all positively significant with the impact of RADP on land reform performance. The impact of RADP on the performance of non-RADP recipients was statistically significant for strategic partnerships (p=0.059), legal entities (p=0.019), and farmers receiving third party support (p=0.095). Strategic partnership (p=0.021) and tax compliance (p=0.010) had a statistically significant effect on RADP beneficiaries' performance. The results showed that land reform has made a progress in ensuing a positive livelihood of beneficiaries even though some challenges are still experienced. Findings showed that the majority of farmers were engaged in off-farm economic activities, access to formal education and have signed a project contract. Mentorship remained a particularly difficult aspect of postsettlement life. However, farmers got a chance to enhance their farms and raise their income through RADP's strategic cooperation. Generally, land reform farmers are full-time farmers and get their income from farm profits. Access to extension services was satisfactory for land reform farmers. The strategic partnership of RADP is likely to improve the farm and the farm income. RADP generally has a positive impact on the performance of the land reform program. There is a need to significantly improve the mentorship program to increase land reform farmers' engagement in the given farmer support programs. It is recommended that more extension services are availed to the land reform farmers.