The Sunday Mail
Business Reporter
Government is looking at ways of making Command Agriculture more efficient and effective and will be engaging the private sector and financial institutions to ascertain what role they can play in strengthening auditing structures of the scheme, a senior Government official has revealed.
The engagement of private audit firms is likely to help reduce default rate.
Command Agriculture is a programme, which entails providing farmers with requisite resources and technical skills, to optimally produce specific crops and was implemented by Government in the last few years as a way of stimulating agricultural production with the accent on ensuring food security.
The first year saw cereal crops production increasing remarkably, but concern was raised over the failure by some farmers including politicians and Government to pay back the money that was mobilised from the private sector.
In its first year, in 2016, the programme achieved a bumper harvest in excess of two million tonnes of maize and other cereals.
The following seasons were, however, not so successful with poor planning and an El Nino induced drought impacting on production heavily.
This was, however, not the only challenge.
Repayment of loans was also very poor as beneficiaries reneged on their obligations over and above sad stories of some farmers who abused the inputs.
Former Finance Minister Patrick Chinamasa revealed in his 2018 Budget presentation that the government had received 66 percent of its target loan repayments and of that only 33 percent had paid in full.
This posed a high risk to the scheme’s future as well as the country’s coffers as Government had to takeover the bad debts.
Finance Minister Mthuli Ncube in his 2019 National Budget Statement, also noted low loan recoveries from farmers contracted under previous facilities, which he said was due to weak management arrangements.
This weakness undermines refinancing of agricultural programmes, said Minister Ncube.
To address this challenge, Government is revamping the whole financing system.
Speaking at the 2019 Mid-Term Budget Review Breakfast meeting held in Harare last week, Secretary in the Ministry of Finance and Economic Development George Guvamatanga, said government was considering how other players can be involved in funding command agriculture.
“At the moment as an institution we are actually considering to see how other players such as banks and other financial institutions can play a significant role in command agriculture.”
He said as safe guard measure, Treasury is also looking at appointing private firms to “actually audit and make sure that the process works much better for us”.
In his 2019 Mid-Term Budget Review presentation, Minister Ncube also highlighted the same saying to close the “loopholes during the forthcoming agriculture season, Government is adopting a targeted approach, which select exclusively farmers with track record of honouring their loan obligations from previous Programmes and have a history of producing high yields.
“The selection of farmers will be done in a transparent way and measures will be put in place to recover all the loans,” said Minister Ncube.
