This chapter examines transformations and continuities in smallholder agriculture in southern Hobeni, in the Xhora District of the Mbhashe Local Municipality in the Eastern Cape, based on fieldwork in 1998 and 1999, 2005, 2009 and 2010, including household surveys in Hobeni (1998 and 2009) and neighbouring Cwebe (1998 and 2003).1 The research findings reveal both recent change – a sharp decline in the cultivation of remote fields since 1998 – and long-term continuities – the expansion and intensification of cultivation in homestead gardens, manifested in increases in the diversity of gardens, in the cultivation of fruit trees and in the intensity of input application. Concurrently, the contribution of formal employment to livelihoods has declined considerably, while the contribution of welfare has expanded.

The research allows a partial assessment of two forms of state support to local livelihoods, the Child Support Grant (CSG) and the provincial Department of Agriculture's Siyazondla Homestead Food Production Programme (henceforth Siyazondla). Since 1998, the CSG has expanded to reach nearly two-thirds of the households in Hobeni, while Siyazondla began to assist households in southern Hobeni in 2007 with production inputs and training.

The chapter engages broader debates about the potential of direct cash transfers (Hanlon et al. 2010) and subsidised inputs for smallholders (Denning et al. 2009; Sanchez et al. 2009) to serve as strategies for rural development and poverty alleviation. Hanlon et al. synthesise the results of research on direct cash transfer programmes worldwide since the late 1990s, including South Africa's CSGs (2010: 38–43). They note the repeated conclusion that such programmes are affordable and efficient. Recipients use the money well and in ways that promote long-term economic growth and human development (2010: 2). Cash transfers encourage other forms of livelihood enhancement by facilitating increased labour migration and investment and experimentation in agriculture (2010: 53–58, 75, 31–32). Nutrition is improved through purchases of more nutritious and diverse foods. They also identify two areas of continuing debate: ‘should smaller grants be given to many people or larger grants to a few?’ and ‘should recipients be asked to satisfy conditions?’ (2010: 3).