The Agricultural Development and Marketing Corporation (Admarc) Limited has disclosed that it needs about K8.9 billion for the retrenchment exercise which is targeting all of its members of staff.
Admarc Head of Administration and Human Resources Ethel Zilirakhasu said this Wednesday when she led a four-member team that appeared before Commissions, Statutory Corporations and State Enterprises Committee of Parliament.
Admarc indicated in a letter from the now-dissolved board of directors to workers that it intended to fire all its employees as part of the corporation’s restructuring process.
Zilirakhasu said for the retrenchment, the State grain trader has a budget of K6.6 billion and will require an additional K2.2 billion to cover for pension arrears which the company has not been remitting to an administrator.
“We have so far calculated and computed retrenchment packages for all the employees and we need about K8.9 billion. Apart from pension funds, Admarc owes its employees bonuses and that is how the figure is being arrived at,” she said.
Zilirakhasu also disclosed that Admarc has so far submitted a request to Treasury for possible funding and that they are engaging the Ministry of Labour for guidance to ensure that the exercise happens in accordance with relevant laws.
But Minister of Finance Sosten Gwengwe said in a separate interview Wednesday that he had not seen the said request.
“[However], we will review the request once it is submitted,” Gwengwe said.
In her presentation before the lawmakers, Zilirakhasu reiterated that Admarc has 4,063 employees and that following the functional review, only 1,565 establishments will be maintained to reduce the wage bill and give dividends to the shareholder.
She said, so far, the State-owned company has set a deadline of November 30 2022 to complete the exercise before re-advertising all the needed positions.
“As we speak, each and every one of us has received a letter notifying them of the pending retrenchment after the restructuring is done and new recruitments are completed.
“The board envisaged to have a new Admarc by March 31 2023 and at that point, there will be need for capital injection into the corporation,” Zilirakhasu said.
She then decried that the current wage bill for Admarc, which stands at K650 million a month, is unsustainable and that the prolonged reliance on Treasury for salaries is long overdue.
Chairperson for the Commissions, Statutory Corporations and State Enterprises Committee of Parliament, Isaac Kaneka, argued that the retrenchment does not make business sense, saying it is too costly.
He said his committee will soon summon Treasury and the Ministry of Agriculture, which shut down Admarc and sent all employees on three-month forced leave.
“There are so many parastatals that are in similar situations; they are making losses for years on end but government has not thought of shutting them down and laying off people, a development which could cost citizens billions of Kwacha. So we are surprised and we want to meet those that made this decision about Admarc,” Kaneka said.
On August 30 2021, Minister of Agriculture Lobin Lowe announced the closure of the longtime loss-making grain trader on grounds of alleged underperformance, theft and fraud by its officers.
Later, the Board of Directors, led by the then-chairperson Alexander Kusamba Dzonzi, announced that it would be laying off all the workers.