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Details of Sh11.3bn scandal at cereals board

Friday August 31 2018

Maize farmers

Maize farmers protest outside the National Cereals and Produce Board offices in Nakuru on August 22, 2018 over delayed payments. PHOTO | AYUB MUIYURO | NATION MEDIA GROUP 

IBRAHIM ORUKO
By IBRAHIM ORUKO
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The anti-graft agency has revealed shocking details on how Sh11.3 billion meant to buy maize from farmers was instead pilfered through an elaborate scheme involving traders and employees of the National Cereals and Produce Board (NCPB).

The Ethics and Anti-Corruption Commission (EACC) said on Thursday that a big chunk of the money was paid out to a small clique of suppliers, mainly traders, through a scheme where they presented false verification forms.

Accordingly, the Select Committee of the Senate, which is investigating the crisis facing the maize sub-sector, was told on Thursday that 10,636 suppliers had delivered their maize to the Board.

However, 146 of these suppliers were paid Sh4.5 billion, leaving 10,490 suppliers, most of them genuine farmers, to share the remaining Sh6.8 billion, which in any case was not disbursed.

LOOPHOLES EXPLOITED

Similarly, out of the 146, 20 suppliers were paid a total of Sh2.5 billion for maize imported from Uganda, suggesting that the system was skewed in favour of a small clique of people who benefited from the scheme.

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Taken further, the committee was told that one family supplied maize to the NCPB worth Sh746 million and it was paid, even though there remains a debate on whether it had the capacity to do so.

Mr Jackson Mue, who is the EACC assistant director in charge of North Rift, told the committee that a majority of the suppliers who were paid were not genuine farmers but were merely facilitated by NCPB insiders to submit fake vetting forms.

“There is a problem with the whole maize supply chain. Some traders exploited the loopholes in this chain and were able to get preferential treatment,” Mr Mue told the committee, which is chaired by Uasin Gishu Senator Margaret Kamar.

The commission initiated investigations after receiving complaints in May 2018 that the Board was purchasing maize from brokers and unregistered farmers who had not been vetted to supply maize.

SMUGGLERS

Part of the complaints was that the traders who were given preferential treatment were smuggling maize from Uganda and selling the same to the Board and, as a result, genuine farmers were denied an opportunity to sell their maize since the traders were selling in large quantities.

“There was an outcry by farmers around March 2018 regarding delays and slow queues especially in Eldoret, Moi’s Bridge, Kitale and Ziwa depots,” Mr Mwaniki Gachoka, a commissioner, said, explaining the involvement of the EACC in the investigations.

He further revealed that, even though NCPB has 110 depots spread across the country, 73 percent of the Sh11.3 billion was allocated to just about six depots for the purchase of the maize, which, he argued, had given incentives to corrupt individuals to exploit.

Eldoret, Moi’s Bridge, Ziwa, Kitale, Bungoma and Kisumu collectively received Sh8.3 billion, while the remaining 105 depots were allocated a measly Sh3 billion.

AUDIT

Chairman Eliud Wabukala said the operations of the NCPB are hampered by weak systems and revealed that the commission and the office of the Auditor General are working together to conduct a systems audit of the Board and develop policy intervention that would seal the loopholes.

Devolution Cabinet Secretary Eugene Wamalwa told the committee that vetting and verification of the farmers who delivered their maize to NCPB will complete this weekend and the State will start paying them Sh1.4 billion it received for that purpose.

Senator Eric Omogeni demanded an explanation from Mr Wamalwa on why maize farmers are never paid upon delivery and challenged the sector to borrow a leaf from the tea industry where farmers are paid on the spot.

“Delays in paying farmers provides a disincentive and the CS should explain why they are punishing farmers,” he said, challenging the NCPB to develop a database that will contain the identity of the farmers, the projected capacity of their delivery and the acreage of their farms so as to have a proper projection of the overall output.