Fired Principal Secretary (PS) for Agriculture Sandram Maweru Wednesday claimed that former Secretary to the President and Cabinet (SPC) Zanga- Zanga Chikhosi forced Smallholder Farmers Fertiliser Revolving Fund of Malawi (SFFRFM) to flout procurement procedures in the controversial 10,000 metric tonnes (mt) fertiliser deal with Paramount Holdings.
Maweru said this to members of the joint parliamentary committee that are investigating alleged anomalies in the implementation of this year’s Affordable Inputs Programme (AIP).
On February 8 2022, the Government of Malawi wrote Paramount Holdings, asking it to release 10,000mt of fertiliser at a 15 percent adjusted price to SFFRFM, without seeking approval from the Public Procurement and Disposal of Assets Authority (PPDA).
It has also come to light that there was no formal contract between them.
The total amount of money involved in the deal in question remains unknown.
“It was not a decision [made] at the ministry. Even my [line Cabinet] minister was not comfortable with it and said he was not party to the decision. The former SPC [Chikhosi] was [at] the centre of it,” he said.
Citing the example of a deal of 30,000mt of fertiliser between the Government of Malawi and AIG, Maweru said there are other fertiliser deals being executed on Chikhosi’s instructions.
He said this means chances of procurement agencies being bypassed are high.
“Yes, I wrote the letter about the 15 percent adjustment price of the 10,000 metric tonnes deal but everything about it came from the Office of the President and Cabinet and it flouted procurement procedures. The AIG procurement [discussions] did not follow procurement procedures and it came through the SPC Chikhosi,” he said.
Responding to questions on the K750 million failed deal between the government and Bakaart Food Company from the United Kingdom, Maweru said a technical committee on AIP within the ministry agreed not to make the deal public.
He said the decision was reached at in an effort to evade cartels that, he said, they believed would work at sabotaging the process, such that the single sourcing mode of procurement was opted for.
“We, as a ministry and technical committee, were well aware of the sabotage risk that government was faced with; as such, it was agreed that the deal should not be made public but be kept under wraps until it materialises,” he said.
On cartels, the former PS informed members of the committee that there was an attempt by a former chief executive officer of SFFRFM to intercept over 30,000 metric tonnes of the commodity which was on its way into Malawi through Beira- Mozambique on the ground that government was failing to raise a Line of Credit.
According to Maweru, the ministry used a consultant, Sheba Gas and Oils Company represented by one Moses Khombe as a consultant to identify fertiliser suppliers without any written contract, a thing which the committee said was an anomaly.
He then said this year’s AIP has been a nightmare, attributing the situation to system failures and forex challenges that the country is facing.
“The fertiliser purchases for this year have been a nightmare on two fronts. Firstly, the appropriated budget of K97. 5 billion, with the [rising] global prices of fertiliser, could not attain and sustain the required number of beneficiaries that the ministry was guided on,” Maweru said.
He then disclosed that the government has slashed the number of AIP beneficiaries for the 2022-23 farming season from 2.7 million to 2.5 million due to inadequate resources.
Maweru said the country has, so far, received a total of 31, 500mt of fertiliser and has so far spent about K29 billion.
During her appearance, Principal Secretary for Agriculture responsible for Technical Services, Medrina Banda, told committee members that documents in her office indicate that K725 million was paid to Bakaart Food Company and not K750 million.
Meanwhile, co-chairperson of the committee, Sameer Suleman, has said they will go to the bottom of the issue of changing figures.
He has also cautioned that government is racing against time to deliver on AIP.