Urgently dismantling NCPB answer to agriculture woes

Wednesday March 18 2020

Agriculture and Irrigation Cabinet Secretary Mwangi Kiunjuri has been a man under siege.

Yet in heaping all blame over the maize and fertiliser scandals on the minister, we are engaging in scapegoating.

Mark you, this is not the first maize or fertiliser scandal to happen. The only difference is the scale of the corruption that has been perpetrated.


If you do your calculations from the information being revealed from the papers recently tabled before oversight committees of Parliament, the taxpayer lost more than Sh33 billion in these two scams.

Personally. I am prepared to give Mr Kiunjuri the benefit of the doubt under the following conditions:

First, he must immediately start implementing reforms leading to the dismantling of the National Cereals and Produce Board (NCPB) and to the consigning of this ancient- regime- and- command and- control parastatal to where its peers such as the Maize and Produce Board, the Sugar and Cereals Finance Corporation and the likes of the Kenya National Trading Corporation were dumped.


The NCPB is firmly under the capture of corrupt millers and traders. Whenever corruption cases touching on imports of sugar, maize, rice, wheat or fertiliser erupt, the names of millers and traders are always the same. Indeed, this parastatal has today evolved into the biggest locus for corruption in the agricultural sector.

While he was the chairman of the NCPB briefly in the Mwai Kibaki presidency, Nairobi businessman Jimna Mbaru tried to introduce a system of warehouse receipts. The cartels would not allow a transparent system to take root. Even now, a Warehouse Receipts Bill fronted by an MP is in circulation.


Mr Kiunjuri must take up this proposal and come up with reforms to cut out the NCPB and the whole bureaucracy at the ministry’s headquarters Kilimo House, Nairobi, from participating in procurement of food and fertiliser subsidies.

And, If I were Mr Kiunjuri, I would immediately invite the Office of the Commissioner of Monopolies to investigate restrictive practises by millers and traders in cereals.

I would also task the monopolies commission to investigate concentration of economic power and to recommend how to eliminate the parasitic classes that are always waiting in the wings to make supernormal profits from food shortages.


My mind is still fresh with what happened during the maize scandal of 2010. A well-intentioned maize subsidy programme was turned into a gravy train. Influence peddlers and briefcase commodity traders turned into millionaires overnight.

To play the game, all that a briefcase trader needed was a letter from Kilimo House ordering the NCPB to allocate you a large quantity of subsidised maize. You then sold that same letter to a miller in the secondary market at a handsome consideration. There were instances when briefcase traders were earning as much as Sh500 for every 90kg bag of maize from selling these letters.


Ministers, permanent secretaries, top government officials and MPs all joined the gravy train. Despite the fact that thousands of bags of maize were being poured into the market, consumer prices kept rising. The irony was that some of the prominent players in the shenanigans received political rewards.

Former Fafi MP Bare Shill, who had been mentioned in a PriceWaterHouse investigation as one of the traders who received large allocations of maize, was appointed by Agriculture minister William Ruto as a director of NCPB. And Mr Mohammed Islam of the Mombasa Maize Millers fame was also appointed a director of the NCPB by the minister.


Which leads me to the fertiliser subsidy programme that the government has been running since 2009. Has this made a positive impact on productivity? What has been the impact in terms of market distortions and competitions?

International fertiliser prices are published regularly. If we want to be transparent and to reduce the risk of corruption, why don’t we just allow local manufacturers and to supply? After all we can always compare their prices by benchmarking on international prices?


I read somewhere how Nigeria had for a long time been running a large state-controlled fertiliser subsidy programme. Due to its popularity, they got to a point when the subsidy was consuming 56 per cent of the federal government’s capital spending.

Corruption was widespread and massive diversion of supplies was taking place with middlemen and rent seekers benefiting at the expense of farmers. Subsidised fertiliser was routinely being smuggled to neighbouring countries.

What did they do in Nigeria: They removed the Agriculture ministry and state corporations from handling the procurement of subsidised fertiliser. We must dismantle the NCPB. Urgently.

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