Sh17bn mystery item in Budget raises fears

The Sh17 billion set aside in the Budget for importing maize this year has raised fears of grand corruption after the departments concerned warned they did not ask for the money.

According to the Budget proposals before Parliament, the money is to buy 5.7 million bags of maize at Sh2,983 each.

But the Ministry of Agriculture, which is the one in charge of the country’s food security, and the House Committee on Agriculture, which monitors the food policies in the country, on Tuesday disowned the allocation.

Agriculture permanent secretary Romano Kiome and the chairman of Parliament’s Agriculture Committee, Mr John Mututho, said the allocation was suspect, because there was no emergency at the moment.

“The truth of the matter is that this is the first time that we have seen money for maize imports earmarked in the Budget Policy Statement.

“It was done without proper consultations. We are the producers yet nobody sought our input,” said Dr Kiome. “Perhaps somebody somewhere knows something that we don’t.”

He said forecasts showed that there was enough food “until the beginning of the next harvest”. (READ: Fresh row over maize import window phase)

Mr Mututho threatened to rally MPs to reject the allocation, saying the money should instead be given to farmers to buy seeds and fertiliser.

“The whole thing smells,” said Mr Mututho, claiming that there were “six ships” packed with maize “just waiting in the high seas” for Parliament to approve the money to dock at the port of Mombasa.

“We shall not be fooled,” said Mr Mututho. Mr David Nyamieno, the chief executive of the Cereal Growers Association, said the decision was arbitrary.

“I am shocked. The figure involved is so huge, they should have put it into fertiliser for the farmers,” Mr Nyamieno said.

However, he said there could be maize shortage just before the early harvest in late June. “But in July, we expect harvest from areas in the South Rift like Bomet, Trans Mara, Migori and Kisii,” he said.

But a Treasury official, who could not be named because he is not authorised to speak to the media, defended the allocation.

“You cannot leave maize importation at the hands of the private sector. How many times have they let us down?

“And then MPs will turn around and blame the government. Right now the rains are good, but there have to be measures in place to cater for such shortage.”

Dr Kiome said it would be wrong to set aside money for maize imports by the Exchequer.

“In our view, we must allow the private sector to import. All the government has to do is remove the duty and let the private sector benefit from market dynamics,” said Dr Kiome.

“That will open imports to the international market and reduce the pressure on the Exchequer.”

Mr Mututho also questioned the Sh11.6 billion allocation to the National Irrigation Board (NIB), saying it had failed to deliver results.

“They have to tell us what they did with the money we gave them last year, and show what impact that money has had on the ground,” he said in a telephone interview.

He said the House team toured Hola and Bura irrigation schemes and found farmers stuck with 6,000 bags of maize from the 2009 bumper harvest.

“The NIB has failed to plan for marketing and post-harvest mechanisms in addition to farm inputs supply,” said Mr Mututho.

The agriculture committee has tabled a report in the House seeking to restructure the NIB to enhance efficiency.

Concessionary imports of food, oil and at one time compensation using public money for exports, during election years have always roused suspicion that the schemes had been hatched to raise campaign funds.

In the lead-up to the 1992 multi-party General Election, there was the Goldenberg scheme where Sh5.8 billion was paid out as compensation for fictitious gold and diamond exports to Kamlesh Pattni and his allies in the Kanu regime.

Sugar imports have also raised questions, with revelations that sugar barons used fake documents to import sugar between March 1, 2010, and February 2011.

Up to 25 million kilos of sugar, sourced from Brazil and Thailand, but imported through Egypt, had entered the country when the scandal was exposed in April, last year.

Thereafter, the barons hoarded the commodity, leading to a sharp price increase.

In 2009, Cabinet ministers, MPs and businessmen took advantage of a government directive to open up Kenya’s strategic grain reserves to buy maize at cheaper prices, hoard it and sell it later to hungry Kenyans at higher prices.

The scam saw maize and flour prices rise twofold and the country is yet to recover from the spike.

The maize scandal was preceded by the Sh10 billion “computer, typing or printing error” in the supplementary budget which could not be explained.

Utility box

In the twilight years of the Moi regime, the Cabinet instructed the National Cereals and Produce Board (NCPB) to import maize. The NCPB did as instructed, but when it got the maize into the country, it incurred a loss of Sh2.2 billion.

The Ministry of Agriculture has been lobbying the Treasury ever since to have that money refunded, and it is this year, that they finally got their wish.

In the Budget Policy Statement, the Treasury allocated the money, Sh2.2 billion for NCPB for “compensation for losses emanating from the Cabinet directive”.