WHY KENYANS ARE FURIOUS WITH THEIR LEADERS

DAILY NATION
By MUNA WAHOME
December 13 2008

Four millers are so far contracted to mill the maize on the government’s behalf and give it back for distribution. The country requires 3 million bags of maize monthly, and the 700,000 is basically supposed to last a week. PS Kiome said the state is yet to deal with the issue of how to handle bran.

Millers make millions as Kenyans starve
A government plan to supply cheap maize flour has run into trouble, amid allegations of corruption. Some millers, who declined to be named for fear of being victimised, accused the Ministry of Agriculture of virtually giving 400,000 bags of maize, bought at taxpayers’ expense, free to a cartel of millers.

Four millers so far are contracted to mill the maize on the government’s behalf and give it back for distribution. They will be paid Sh80 million for the job, according to the miller — or 800 million if it goes on for 10 weeks. And they could add another Sh540 million over a similar period if they keep the by-product.

Already, 40,000 packages of low-priced maize meal are lying at the National Cereals and Produce Board (NCPB) as questions emerged on the commercial prudence of the new state flour scheme.

Agriculture permanent secretary Dr Romano Kiome confirmed that the government was yet to conclude a list of stockists to sell the low-cost flour.

The government recently said it was releasing 700,000 bags of maize to millers after it emerged that a cartel of brokers were getting supply from NCPB at Sh1,750 and selling the taxpayer-purchased commodity for as high as Sh2,650.

Some 400,000 bags were to go to contracted millers to make the cheap flour, with the balance going to commercial millers. But murmurs have emerged over the selection of the beneficiaries without any competitive bidding.

The first bulk supply was done by one of the large millers contracted by the government. Like the others, they will be paid Sh200 to mill a 90kg bag of maize.

Dr Kiome defended the selection saying that those chosen had “voluntarily” agreed to avail 30 per cent of their milling capacity to the project. He said the government was still registering more millers for the service.

Even ignoring the voluntary bit, there is a major catch, which prompted Sunday Nation to ask Dr Kiome whether it was indeed prudent to pay the millers — they keep the bran!

The PS said the state is yet to deal with the issue of how to handle the by-product. “We might have them give us back the product,” he said.

The price of animal feed has skyrocketed as the maize supply grew short following the post-election displacement of farmers and drought.

A miller said a bag was fetching Sh900. Normally, the by-product makes up to 15 per cent of every bag.

For 400,000 bags, that would make 60,000 bags and, in theory, that would translate into a Sh54 million extra income for millers if the by-product is not claimed.

If the project goes on for, say 10 weeks, the millers stand to make Sh540 million at taxpayers’ expense — add that to the milling charges of Sh800 million you get nearly Sh1.4 billion.

The country requires 3 million bags of maize monthly, and the 700,000 is basically supposed to last a week.

NCPB has corruption and efficiency problems, and few in the industry think it has the capacity to distribute flour, leave alone animal feed. But, even as the government goes into grain milling, some millers say it is impossible to know how much flour will come out of each bag.