Agricultural Development and Marketing Corporation (Admarc) CEO, Foster Mulumbe, failed to give convincing explanations to Members of the joint Parliamentary Committee of Agriculture and Public Accounts on Wednesday when he was summoned to give an account of the suspicious maize deal between Malawi and Zambia.
At one point, Mulumbe made contradicting statement to what Director of Public Procurement (DPP) Paul Taulo, who gave his account earlier in the day, made to the committee.
When he appeared before the joint committee in the morning, Taulo indicated that Mulumbe had made a phone call from Zambia where Admarc was to procure the 100,000 metric tonnes of maize telling Taulo to issue a letter of no objection in relation to the procurement of maize.
“On 17 June, 2016, I received a call from the Admarc CEO in which he told me that Malawi wanted to procure maize from Zambia. He called from Zambia and I was on my way to my home village in Neno.
“Looking at the urgency of the matter where Admarc had to have the maize immediately, we had to issue the no objection letter,” said Taulo.
Surprisingly, Mulumbe denied twice having called Taulo, to request his office that it should issue the letter.
“I was trying to recollect the time that I called the ODPP [Office of the Director of Procurement] when I was in Zambia. I really don’t remember having made that call,” said Mulumbe.
Member of Parliament (MP) for Dowa East, Richard Chimwembo Banda, wanted the CEO to furnish the committee with information regarding the alleged phone call and whether it was recommended for transactions of such magnitude to be made on phone.
The Admarc boss attempted to defend the procurement process but fell short of convincing the lawmakers who accused him of trying to shield someone who might have been pressurising the Admarc boss to hurry processes which demanded some caution.
During the questioning, it also transpired that Mulumbe had signed a contract with the Zambia Cooperative Federation (ZCF) for the supply of the grain almost a month before he obtained a letter of no objection from the (ODPP).
The Admarc CEO argued that the arrangement was because the corporation could not ask the bank to make any process towards the issuing of the letter of credit (LC) without having a contract. However, the lawmakers maintained that this was grossly irregular.
It also transpired from an analysis of the documents that had been tendered to the joint committee that two contracts involving Admarc and Kaloswe Commuter and Couriers and ZCF were both signed on 17 June, 2016 even though Mulumbe had earlier indicated that Admarc had opted for ZCF after Kaloswe had failed to convince the corporation that it could supply the maize.
He also admitted that Admarc had not involved the Ministry of Justice in the procurement process even though it is required that procurements of this magnitude should involve the ministry.
“Even the cancellation of the contract [with Kaloswe] should have involved the Ministry of Justice because it has legal implications if not handled carefully,” said MP for Karonga Central Frank Mwenifumbo.
Taulo provided documents to the joint committee to support his office’s transactions in the process but the documents raised eyebrows among the lawmakers who wondered how a transaction involving K24 billion could be concluded in a matter of hours.
According to the documents, Taulo’s office received a request for a letter of no objection from Admarc on 17 June, 2016 and reviewed the same within hours before issuing the no objection letter the following day, a Saturday.
According to the lawmakers, the whole arrangement is suspicious because the DPP was supposed to handle the matter with caution due to the amount of money involved.
The documents that were submitted to the joint committee indicate that the meeting by Admarc Internal Procurement Committee (IPC) ended at 4 pm on 17 June and a request for a letter of no objection was made the same day.
“This hurry is what looks suspicious because it involves a lot of money where caution should have been exercised. Additionally, there is some twist of which was supposed to start between the request for a letter of no objection and the issuance of the same,” said Chimwendo Banda.
During the meeting, Taulo also disclosed that Admarc came back to him on 13 July with a revised request that another company, Zambia Cooperative Federation (ZCF), should instead supply the maize after Kaloswe Commuters and Couriers had failed to do so.
“They also indicated that the PTA Bank was not comfortable to pay through a third tier which in this case was Kaloswe Commuters and Couriers. We revoked the earlier no objection letter and issued another one for [ZCF],” said Taulo.
However, this did also not go down well with members of the joint committee who wondered why the DPP would issue another letter of no objection without apparently critically understanding the contract on the previous supplier and how the termination procedures had need made.
In his defence against the allegations that the procurement was not done properly, Taulo argued that everything was done in a hurry because the country was in dire need of the grain.
The lawmakers also accused Taulo of being casual in his response. They also demanded a clear explanation on why he was apparently contradicting himself on whether he was around when the first letter of no objection was given to Admarc.
Meanwhile, the committee has asked Taulo to bring what it calls more relevant documents and two other officers under his authority who are believed to have taken important roles in the procurement process.
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