For the last few decades a large number of industries in the agricultural sector have been charging statutory levies imposed on each unit of product along the chain between producer and consumer. These levies, charged as a percentage of cost, are borne by the consumer. They were intended to finance predetermined functions like transformation, research, export initiatives, product development and others.
These levies are promulgated under the Marketing of Agricultural Products Act and efficiently administered by the National Agricultural Marketing Council. Some of the industries involved are fruit, milk, meat, maize, cereal, sorghum, potatoes, nuts, wine and cotton. I believe that close to 80% of agricultural products are part of the levy programme.
The levies may well have served a useful function at first, but in these unprecedented difficult times surely they should be terminated, or at least suspended? Otherwise the relevant industries must finance the levies themselves. If the embattled poultry industry can operate without them (it apparently withdrew some years back), surely others can afford to finance transformation and product and market development on their own too.
We are talking about hundreds of millions of rand. The 2019 figure was over R700m. A price drop of a couple percent will meaningfully reduce inflation and add to the very limited buying power of our huge mass of poor and unemployed people. It would be equivalent to a VAT reduction on many essential food products.
The levies are a luxury we can no longer afford.
Craig Dennis Wilson, Gallo Manor
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