Govt owes seed companies ZMW 56 million

Maize farm in Kalomo district of Zambia. The e-voucher system has delayed maize farmers and as such the ministry of agriculture is luring farmers into diversifying into other crops.

Minister of Agriculture Michael Katambo says his ministry is owing seed companies that supplied the input under the farming input support program- FISP for 2016/17 and 2017/18 farming season about K56,355,627.64 due to budgetary constraints the ministry faced in programme implementation.

He also said that the ministry is constantly engaging seed suppliers and they have since presented the operational challenges to government. “Therefore government is aware of the challenges that they facing. We are closely working with the ministry of finance in releasing of funds to liquidity the debt owed to seed companies, and we have started making payments to seed companies and some of the challenges aroused from government owing seed suppliers were failure to met storage costs, transportation, packaging and materials, ” he said.

Speaking in parliament when giving governments position on challenges facing the Agro sector, the minister added that seed companies have been assured of the efforts the government is making such as reducing of arrears from the total ZMW174 million as beginning of this year to about ZMW 56 million.

“This indicates that ZMW 120 million has so far been paid. We remain committed to meet the outstanding obligation. But the issue is the financial constraints, the only permanent solution will be engaging the ministry of finance in releasing the funds on time and am pleased to mention that seed companies have started moving the input to various districts and farmers on FISP programme who have deposited the K400 contribution fee are receiving the seeds,” Katambo stated.

The Agro Minister further assured the farmers that distribution of seeds is currently on-going and progressing well. “Zambia is one of the major seed suppliers in the region and that security is guaranteed for seeds supply for our local farmers and neighbouring countries. We submitted all the schedules to ministry of finance and the ministry is running around time in ensuring that the seed suppliers are paid the remaining amount. We can assure seed companies that government is committed to settle arrears and agriculture as remained priority for funding in the next coming season,” he highlighted.

During the 2019 budget presentation Finance minister Migrate Mwanakatwe said “A number of challenges were observed with the e-voucher system during the 2017/2018 farming season. Key among these were limitations of telecommunication connectivity, financial services provision challenges and limited information technology.

As these challenges are being addressed, in the 2018/2019 farming season, Government will procure and distribute inputs to the affected parts of the country. The affected districts will be re-introduced on the e-voucher system in 2019, once the challenges have been resolved.” The Agriculture sector has been allocated with ZMW 5.4 billion which also caters for livestock and fisheries.

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