The Minister of Agriculture, John Steenhuisen, has scrapped a costly inherited supplier deal that would’ve driven up bread prices.

Thanks to this intervention, national retailers have confirmed that a major price hike has been avoided.

Earlier this month, Steenhuisen announced he had officially revoked the designation of Leaf Services as an assignee responsible for inspecting grain and grain products in South Africa.

Leaf Services was appointed in 2006 under the Agricultural Product Standards Act, and was tasked with carrying out inspections for grading and labelling of staple foods such as maize meal and bread.

However, the Minister said the company failed to meet necessary standards of transparency, consultation, and compliance with administrative justice.

According to the Department of Agriculture, the inspection fees proposed by Leaf Services lacked a sound methodology and could have cost the grain and oilseed industry tens of millions of rands, which would then have been passed on to consumers.

The decision to revoke has been welcomed by stakeholders, including Pick n Pay, the Consumer Goods Council of South Africa (CGCSA), GrainSA and the Chamber of Baking.

GrainSA says that had the proposed R4-per-ton fee by Leaf Services been implemented in 2016 as intended, it would have cost their members more than R600 million to date.

Going forward, the Department’s own Inspection Unit will take over responsibility for inspections to ensure food safety and compliance with regulations.

Steenhuisen says the government will explore a more effective public-private partnership model for future inspections.

Meanwhile, the DA says across the Government of National Unity, DA Ministers are implementing policy and regulations that can drive down the cost of living, and can also stop rising prices.

The party says the latest example of the DA’s Delivery-on-Promise is that Steenhuisen has stopped a hike in bread prices.

It’s unclear at this stage whether Leaf Services will appeal the decision.