I can’t believe it that the Malawi Energy Regulatory Authority (Mera) can decide to release a jaw-dropping K3 billion to Admarc to buy maize without the authorisation, let alone, knowledge of the Minister of Finance.
More so that Mera wrote the Secretary to the Treasury (ST) informing him and seeking his advice about the decision. No, tell us something else Mr. Minister.
But that is the diet of lies the good minister has decided to feed us with. Or should we say it is Mera that is lying? May be. But most unlikely.
For starters, the Mera board released K2.964 billion at the end of February this year for Admarc to buy 10 000 metric tonnes of maize from the Auction Holdings Commodity Exchange without the approval of the Ministry of Finance! Mera then wrote the ST informing him as well as seeking his advice about the decision.
Mera was, therefore, supposed to wait for ST’s advice before implementing the board’s decision.
But from what the minister is saying, Mera went ahead to implement the decision without the ministry authorising it. This is what I can’t believe.
Anyway, whoever authorised payment, Admarc got the money or maize. This was in addition to the K4.8 billion Parliament had approved for the grain marker to buy 30 000 metric tonnes of maize from Zambia.
Let’s get things right: Mera, as a government body, has no mandate to splurge out such largesse to other government firms without the approval of the mother ministry.
As a matter of fact, not even the Ministry of Finance has the mandate to allow Mera to spend such as an amount of money without Parliament’s approval. But as things are, either Mera bypassed the minister (which is most unlikely) or the minister is lying. But someone must own it. What is for certain is that one of the two institutions went ahead to break all laws in the book. And that is Malawi for you. Anything goes. And with impunity. More likely much more is happening that we will never know.
As if bypassing Parliament is not bad enough, this money was taken from the fuel Price Stabilisation Fund (PSF). The PSF is an account that accumulates funds from fuel sales meant to cushion any rises in fuel products that would raise inflation. The wrong doing here is that using the PSF for purposes other than the intended one is inflationary. PSF is meant to suppress inflation.
Consumers may wish to know that when they buy fuel in Malawi, apart from paying the PSF levy, they also pay the Road Levy, Malawi Bureau of Standards Levy and the Rural Electrification Levy, as established in the Energy Laws of 2004. There also used to be the Drought/Maize Levy which was removed in May 2012 following an improvement in the maize production then.
By the way, just out of interest, how much was in the Drought Levy Fund and what happened to the funds when the levy was removed in the fuel price structure in 2012?
These days we rarely hear about the Rural Electrification Programme. Yet there is a fund consumers are contributing to. How much has the levy accumulated? At least we hear the Malawi Bureau of Standards wants to build an office complex in Lilongwe. As for the Roads Levy, we have seen a few sign posts in town that show Treasury will fund the upgrading of some roads to asphalt level in Blantyre, Lilongwe and Mzuzu. I have read elsewhere that Treasury has released K6 billion to the city councils for that purpose. But is there any activity underway with regards to rural electrification?
I digressed. Gondwe is saying they are investigating. Investigating what? The mess happened a month ago and the Ministry is still investigating! Anyway, whatever is being investigated, Admarc has received K7. 8 billion to buy maize. This should translate in the region of 27 000 metric tonnes of maize.
With the lean period coming to an end soon, the huge amount of money Admarc has received—legally or illegally—should enable it to buy enough stocks from the local market and avoid a repeat of the situation the country has experienced this year where government has had to import maize from Zambia and Tanzania because Admarc was not front loaded to compete with private traders.