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June 24, 2018

Inside story of the NCPB maize scam

Crop Development PS Richard Lesiyampe arrives to testify before the Parliamentary Accounts Committee yesterday. /JACK OWUOR
Crop Development PS Richard Lesiyampe arrives to testify before the Parliamentary Accounts Committee yesterday. /JACK OWUOR

The rot at the National Cereals and Produce Board has been laid bare, exposing how well connected cartels are minting billions at the expense of the Kenyan farmer.

Just days after Agriculture CS Mwangi Kiunjuri kicked off a grand house cleaning at NCPB, an internal ministry report has smoked out 18 unscrupulous traders suspected to have links with powerful people.

The traders masquerading as farmers were vetted and rejected, rekindling memories of the maize scandal that rocked the country in 2010.

Eight farmers, seven from the Eldoret depot, will pocket Sh873.2 million. They already have pocketed Sh607,764,171.

The report says, for instance, Celestine Chepchirchir — not a registered farmer — delivered 226,108 bags of 50kgs to Eldoret and was paid Sh333 million.

She is yet to be paid Sh62.1 million.

Producing 226, 108 bags is a nearly impossible for one farmer because it requires almost 11,305 acres, nearly twice the size of some constituencies.

Read: MP Sudi to DCI: Publish names of politicians behind NCPB Sh1.9bn maize scandal

PURGE

Last week, NCPB Managing Director Newton Terer resigned, as Kiunjuri cracked the whip.

Five top managers were suspended and 59 other officials put under investigation in the purge.

The internal report indicates that Stephen Maiyo was paid Sh148 million for supplying 109,506 bags of maize. He claims a balance of Sh43 million.

At Kisumu depot, Caroline Chepchumba was supposed to receive Sh216 million for supplying 121,617 bags weighing 50kgs.

NCPB has paid her Sh96.2 million.

Principal Secretary for Crop Development Richard Lesiyampe yesterday tabled the damning report before the National Assembly Public Accounts Committee.

But Lesiyampe told the committee chaired by Ugunja MP Opiyo Wandayi that the government did not lose any money.

"I can confirm that no money was lost and in fact we received all the maize. Currently, we have about 3.8 million bags of maize at NCPB depots. I cannot confirm connections and networks of these traders but we are digging into it," Lesiyampe said.

The Star has established that a multi-agency team of detectives has swung into action.

“Investigators don't shout. The probe is ongoing. It's a matter of time before culprits are made to answer,” a source familiar with the investigation told the Star.

Speaking to the Star in his office yesterday, Kiunjuri said Kenyan farmers will not suffer at the expense of unscrupulous traders.

“Although no money was lost, as a country we have lost an opportunity. The government intention to strengthen the farmer through fertiliser subsidies and good buying prices, is not fulfilled,” Kiunjuri said. He said foreign farmers will not benefit.

WHY DIDN'T THEY ASK?

The CS said NCPB bosses were negligent because the number of bags supplied was inordinately large in some cases.

“Even that manager receiving maize, why didn't they ask themselves, 'Where can you grow much maize?'" With over 200,000 bags, you need to cultivate more than 8,500 acres."

Lesiyampe told the committee traders could have bought from unsuspecting farmers at Sh2,500 per bag and sold it to NCPB at Sh3,200.

Wandayi asked, "Did you consider the possibility that these individuals did not sell any maize and were paid for selling air?"

The PS said some traders were paid within 14 to 21 days from the date of delivery, while genuine farmers have waited for five months.

"As we sit here, we have paid 3,600 farmers their dues but we could have done this as early as February if these 18 traders were not paid. We had the resources," he said.

About 4,000 farmers took maize to depots but local farmers were not given priority, Lesiyampe said. "We suspended all three regional managers."

Lesiyampe said the internal audit did not link any MP to the scandal.

Normally, when farmers deliver maize they must present a letter signed by the chief, ward administrator, an officer from the Agriculture ministry and a religious leader.

WAITING TO BE PAID

The depot manager tests if the maize is dry has required moisture content of 13.5 per cent. Only then does the farmer get a receipt. He awaits money in his bank in two weeks.

This year, however, farmers who delivered maize as early as January are yet to be paid. They have protested, while the traders who bought cheap maize from Uganda and sold have already received 80 per cent payment.

Since October last year, the government has bought Sh11.4 billion maize. Of this, Sh7.8 billion has been cleared. Last week the government released another Sh1 billion to pay 3,200 farmers and clear part of the Sh2.6 billion owed.

This prompted auditing of maize buying reports at the board. Then came house cleaning.

In the Kisumu depot, all five individuals who supplied 10,000 bags and above were all established to be traders upon vetting.

The five had been paid a total of Sh130.1, Sh286.5 million is pending.

In Nakuru, 18 farmers supplied more than 10,000 bags. However, nine were found to be dishonest. "Out of the 18 farmers vetted, nine farmers were disowned by the chief of Rongai whom they had indicated in application for maize purchase forms as their witness," the report says.

The nine had supplied maize valued at Sh156.4 million, of which they had received Sh30.5 million. In total, the NCPB had paid Sh768.3 million to all unscrupulous traders across the country.

However, Sh376.8 million is still pending.

NOT THE FIRST MAIZE SCAM

The scandal also involved subsidised fertiliser. Cartels colluded with NCPB officers to repackage and resell it to farmers at exorbitant prices.

This is not the first time the board has been hit by maize scams.

In 2008, more than 800,000 bags of maize worth Sh150 million were allocated to briefcase millers as the country faced a maize shortage. The Kenya Anti-Corruption Commission investigated and recommended disciplinary action. Nothing happened.

In May 2016, 22 board officers were suspended for stealing subsidised fertiliser. They were involved with traders who repackaged and sold government fertiliser to farmers at high prices.

Rift Valley farmers have called for overhaul of the NCPB and urged an in-depth probe.

Antony Kioko from the Cereal Growers Association said the board should be disbanded and all the depots should put under the county governments.

In the Kisumu depot, all five individuals who supplied 10,000 bags and above were all established to be traders upon vetting.

The five have been paid a total of Sh130.1 million, Sh286.5 million is pending.

In Nakuru, 18 farmers supplied more than 10,000 bags. However, nine were found to be dishonest. "Out of the 18 farmers vetted, nine farmers were disowned by the chief of Rongai whom they had indicated in application for maze purchase form as their witness," the report says.

The nine had supplied maize valued at Sh156.4 million, of which they had received Sh30.5 million.

In total, NCPB had paid Sh768.3 million to all unscrupulous traders across the country.

However, Sh376.8 is still pending.

Also read: CEO Newton Terer resigns from NCPB amid probe on illegal maize imports

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