allAfrica.com: Nigeria: Fertiliser - As Contractors Lay Ambush for Abba Ruma (Page 1 of 1)

The current world food crisis has brought about a lot of concern for nations, how to solve the problem and ensure that it does not rear its ugly head again.

It took most countries by surprise because, even with low yields per capital in previous years, past governments failed to take precautions to avert future occurrence. Here in Nigeria, the immediate past government of Olusegun Obasanjo did not anticipate such a national calamity, so it did not plan for it. Golu Timothy takes an indepth look at the issue

Last year, Nigerian farmers did not enjoy bountiful harvest because of so many reasons. First, the epileptic rainfalls did not allow some particular food crops to grow, and the result is the heavy stunted growth which affected productivity. Second, there was no fertiliser for farmers to apply to the crops, so the crops suffered serious setback in terms of delivery. Third, even where fertilisers were provided, they were made to be artificially scarce, and were sold beyond the reach of the masses whom the product was meant for. Greedy, rich middlemen always hijacked the product by buying them in large quantities, to be resold at higher prices. That has been responsible for the yearly problem affecting the agricultural sector, especially as it concerns the masses.

But things seem to have changed this year, as the new government made it clear that it will not be business as usual. It was on the basis of this avowed principle that the Federal Government, through the ministry of agriculture and water resources, streamlined the process of fertiliser distribution to make it more open and transparent.

The government realised the old procedure of procuring and distributing the product has not achieved the desired result, so it narrowed the process for easy monitoring and effective delivery. It therefore limited the number of contractors involved in the supply of the essential farm product. Initially, about 80 or so contractors expressed intention to procure the product, but the government trimmed the number to three. The final number was arrived through an open process of bidding in which all of them were screened and verified. The verification led to the shocking discovery that about nine of the companies involved do not posses the required clearance for the job. Some of them were said to have used fake papers to scale the hurdle of verification, but the eagled-eye of a 16 man monitoring committee did the magic.

One wonders why some Nigerians are so used to illegalities that they find it difficult to adjust to changes or reforms. It would be recalled that the period 1977-1996 witnessed a period of government monopoly in fertiliser procurement and distribution. That did not help the nation in any way, as it resulted in colossal wastages, over invoicing by those in charge, diversion of the product, theft on transit, adulteration of the product, dumping of the product in odd places instead of safe warehouses and smuggling to neighbouring countries. This practice continued inspite of the fertiliser decree of 1992 which provided for serious sanctions. This did not deter the perpetrators of the act because the sanctions were just on paper and were not enforced. Consequently, the fertiliser sub- sector was liberalised with the removal of subsidy in 1997 inspite of the problems listed above. The variations in government policies then affected the performances of those responsible for the procurement and distribution of the product. It is on record that fertiliser supply was at its lowest ebb between 1997 and 1998 under this period with a consumption level from 1.2million metric tonnes in 1992 to 56,708 mt in 1997.

The Obasanjo administration tried to alleviate the suffering of the farmers by re-introducing fertilizer subsidy as a way of fulfilling campaign promises and also to restore order in the sub-sector so as to boost production. This led to the creation of a full fledged department for fertiliser and the approval of a product revolving fund. The sum of N3.071 billion was made available for the purchase of 120,000 metric tonnes, while direct importation by government was halted. Between 1999 and 2006,a total of 1,085,688.88 tonnes of assorted fertilisers was supplied to the farmers through the modality of state ministries of agriculture, agricultural development projects, river basin development authorities and the national special programme on food security and the farmers associations. Under this arrangement, there was regular monitoring of delivery and sample collection, analysis of same for quality control and other forms of monitoring.

However, the laudable policy suffered due to poor remittances of sale proceeds from states, bureaucratic bottlenecks in the release of government subsidy, low budgetary provision, weak mechanism to enforce penalties and absence of legislation and regulatory agency to sanction erring operators.

In 2007,the quantity of supply increased to 528,000mt from 250,000mt in 2006,valued at N33,886,5000.00 (with a subsidy of N8,471.625,000.00)which was done through tenders by 65 companies. In 2008,there was a plan to increase supply to 650,000mt to mitigate the previous losses. Adequate measures were then put in place to provide the product at affordable prices. Following advertisements, 321 companies applied for supply of the product and after a rigorous process of evaluation and verification,96 were pre-qualified to tender.36 of them made it to the interview level in February this year and finally, three won the bid to supply the product for the 2008 farming season. But before arriving at the final list, a fertiliser verification team was set up by the agriculture minister, Abba Sayyadi Ruma to verify the types and quantities of the product in need at the respective warehouses. The membership of the team was drawn from the ministry, NPA, SSS, the Police, NIMASA,CBN and the Customs service. They commenced a thorough and extensive verification of the shortlisted companies in accordance with laid down regulations and came out with a transparent and open conclusion that was generally accepted by stakeholders as the best way of achieving maximum result. Based on the findings of the team, some companies were found to have complied substantially with approved guidelines with the discovery of 226,430 mt of UREA, and 168,930 of NPK in stock a little less than what was required for the farming season. On the other hand, some companies were discovered to have supplied unverified information and were accordingly disqualified from further participation in the programme. Those found to have large stocks of the product are cleared the way to supply, while those with satisfactory arrangements for shipment are to be considered in the subsequent exercise.

This transparent and open process did not go down well with contractors who failed in their bid to participate in the fertiliser programme, hence their resort to condemn the process. After failing to get the government to reverse the whole process, they approached the senate to call the minister to order, thinking that may help them. And perhaps being ignorant of the intention of the aggrieved contractors, the senate has been on the neck of the minister to come and re-explain himself after he has done so. This penchant for probes and public hearings by our legislators contradicts their fundamental constitutional obligation of law making, and therefore the goal of good governance may suffer. With due respect, the distinguished men and women in both chambers of the Assembly were elected to make laws for the good governance of our nation and, in doing so, work in harmony with the Executive and the Legislature. Yes, there is need to respect the principle of separation of powers, which the present crop of lawmakers have upheld with some seriousness.

But is it right for the senate to probe the procurement and distribution of fertiliser and grains since 1999,in which a whooping N300 billion was spent and not be interested in the distribution aspect of it? The senate had indicated its resolve to mandate its committee on agriculture and rural development to conduct a public hearing with the view to investigating why the current food crisis persists despite the investment of a sum of N300 billion on fertiliser procurement and distribution from 1999 to date. There is great cause to be worried that the senate has just realised that there is a fundamental problem with the agric sector in Nigeria. There is cause for worry that rather than examine the whole agric sector, along with its water component our lawmakers are interested only in "distribution of fertiliser and grains.

Nigerians cannot understand why the senate has decided to probe the supply and distribution of fertiliser instead of looking at the whole gamut of the agric sector. It is suspicious that the senate has been coerced to re-open the issue of fertiliser procurement for the 2008 planting season. This is worrisome after the minister of agriculture has given a comprehensive explanation on the new Federal Government policy on fertiliser. I recall that the minister was a guest of the senate committee on agriculture and rural development some two weeks back. Was the committee satisfied with the detailed explanation by the minister? If so why now begin a public hearing on fertiliser procurement?

Nigerians believe that the imminent public hearing on fertiliser procurement and distribution is induced by contractors who have flooded every where with petitions because they lost out in the 2008 fertiliser supply. If not, why will the senate be interested in fertiliser procurement alone? What about irrigation and the billions of naira sunk into dams, river basins and boreholes? What about several storage facilities (silos) that have remained uncompleted many years after contracts were awarded? What about research institutes that are funded to produce high yield varieties of crops? Why is the senate just interested in examining only one malaise of agriculture in Nigeria and not the whole value chain of production, processing, storage and marketing?

It is logically wrong, improper and diversionary for the senate to claim that fertilisers are not yet available to farmers after details on the supply for the 2008 season have been widely publicised in the media. This fact was affirmed by members of the senate committee on agriculture when the minister appeared before the committee. It is also wrong for the senate to insinuate that farmers "may eventually pay prices above international market price for fertiliser". It is proper and intelligent to assume that the senate committee on agric should have educated the larger house on the fertiliser pricing structure. The Federal Government pays 25 per cent of the cost in form of a subsidy. The state governors are expected to further subsidise the cost of fertiliser before selling to farmers. For instance, the Kwara State government, has announced 70 per cent subsidy. Many state governments have also announced their subsidies. The senate cannot claim ignorance of this. And why not just ask the state governors of information relating to fertiliser supply and prices instead of opting to stage another television jamboree called public hearing?

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