Govt, Admarc’s promises & lies

Through the Public Sector Reforms Management Unit, Malawi Government in November 2020 signed a performance contract to recapitalise Admarc with K265 billion, but before this was fulfilled, government controversially closed the State produce trader.

The K265 billion capital injection, planned to be disbursed in the 2020/21 financial year, was meant to be a once-off loan facility to the financially-crippled Agricultural Development and Marketing Corporation (Admarc), with tenure of not less than five years.

In the performance contract President Lazarus Chakwera and fired minister of Agriculture Lobin Lowe signed, government committed to pay K23 billion it owed Admarc over a three-year-from 2020 to September 2023.

But before the government met its pledge, Lowe, fired by Chakwera for a messed up Affordable Inputs Programme (AIP) deal, shut down Admarc operations on August 31 2022.

On the other hand, Admarc had also pledged to prudently manage all finances as provided for in the Public Finance Management Act, 2003 and other guidelines.

Further, Admarc had also pledged to adhere to all procurement guidelines as provided for in the Public Procurement and Disposal of Assets (PPDA) Act of 2017, conduct its business professionally to ensure that there is no influence from politicians and any other forms of malpractices, among others.

But Admarc failed to to fulfil its pledges following revelations of a K330 million fraud and abuse masterminded by employees through bogus car insurance and medical cover claims as well as dubious staff loan scheme as exposed by an audit last September.

And last week during an inquiry by a joint parliamentary committee probing misprocurements and abuse of public resources, Comptroller of Statutory Corporations Peter Simbani told the hearing that politicians have destroyed Admarc.

During his appearance since the onset of World War I.

Traditionally, two minutes of silence are observed closest to November 11 at 11am in honour of the fallen soldiers.

Chakwera was the first to lay the wreath followed by Chilima while Malawi Defence Force (MDF) Commander General Vincent Nundwe and Inspector General of Police Merlyne Yolamu, who jointly laid their wreaths, came third.

In an interview monitored on Malawi Broadcasting Corporation (MBC) TV, former MDF

before the committee in Lilongwe on Wednesday, he said his office was not consulted when Lowe shut down Admarc and sent staff on indefinite leave. He told the inquiry the closure surprised him.

Speaking when he appeared before the committee, Admarc acting general manager Jerome Chim’gonda Nkhoma said he was getting pressure from a former Admarc board chairperson to buy all the maize from Market Link.

He also revealed that he received threats that made him leave his Blantyre office and relocate to Lilongwe.

The Public Sector Reforms Management Department in a written response to a questionnaire on Thursday confirmed the Minister of Agriculture signed a performance contract with the President in November 2020 on Admarc.

The department’s spokesperson Suzgo Khunga said the Public Sector Reforms Management Unit has been monitoring the implementation of reform areas.

She said: “Themonitoring took the form of periodic review meetings where the minister as well as officials from statutory corporations, the board and management of Admarc have been present.

“The policy decision made on Admarc was taken by the line ministry for the corporation. As we have done with other parastatals, we have requested for a quarterly reforms progress report from Admarc because at the last review meeting in October 2021, Admarc was guided to expedite its turnaround strategy.”

Khunga said the line ministry, Agriculture, should be better placed to explain the plans on the reform areas which Admarc was implementing.

She said her department will wait to hear from the Ministry of Agriculture on the way forward.

Minister of Agriculture Sam Kawale last week said he would respond to our questionnaire this week.

But Minister of Information and Digitisation Gospel Kazako said in a response to a questionnaire that the government realises that Admarc is critical to the socio-economic development of the majority of Malawians.

“It requires reconstruction with depth and solid pillars. We are monitoring what is coming out of the parliamentary hearing and our resolve to reconstitute Admarc is being reinforced,” he said.

Kazako, who is the official government spokesperson, said Admarc had only its operations suspended to facilitate the rebirth of a new Admarc that would not be abused as was the case before.

Admarc is one of the parastatals that have been struggling financially and has over the years failed to serve Malawians as per its mandate as a produce stabilizer and ready market for farmers. Admarc has also failed to perform its social function as government’s food security apparatus.

According to the 2021 Malawi Government Annual Economic Report, as at half year of the 2021/22 financial year, Admarc recorded a net loss after tax of K3.7 billion.

Until 1987, Admarc was the sole buyer of smallholder produce, but in 2004, it was incorporated as a limited liability company with the government owning 99 percent of the shares.