Bukola Ojeme
19 July 2008
NIGERIANS may be in for endless wait for the amelioration of the pains of the rising cost of food in the country in response to global food crisis, as some state governments officials now sell allocations from strategic grains reserve to a cartel of commodity traders, instead of releasing same to the populace.
The Federal Government had released over 60,000 metric tonnes of grains to states at subsided cost from its strategic reserve, as part of measures to cushion the effect of global food shortage.
But investigations revealed at the weekend that no fewer than 20 states have sold off their allocations to a cartel of commodity traders who buy, hoard and later resell to state governments at highly inflated rates.
Only last week, the Senate Committee probing food crises in the country had revealed that some senators and emirs benefitted more from grains and fertilizer allocations to the detriment of farmers.
The cartel, allegedly controlled from Funtua in Katsina State and Ibadan in Oyo State, as learnt, have already bought up a substantial share of fertilizer allocations to states from the Federal Government for the 2008/2009 farming season, effectively ruling out chances of improved yield as palliative to the rising cost of food in the country.
The personal assistant in charge of protocol to the governor of one of the south-eastern states (name withheld) was arrested by detectives from the Federal Capital Territory Police Command, last week, over a N73bmillion grain and fertilizer deal gone sour. The state governor was fingered in the deal. Sunday Vanguard investigations revealed that, rather than boost the revenue of the beneficiary states, money realized from the sale of the grains and fertilizer to this cartel invariably end up in the private pockets of the political leadership and their cronies in the states.
The procedure for the allocations showed that once a state government pays for allocation, it is issued a letter of authority to collect grains by the Strategic Grains Reserve Department of the Federal Ministry of Agriculture and Water Resources to the Silo Manager of any of the 28 designated silos across the country.
The state governments, through their ministry of agriculture, is normally expected to go and take delivery and inject the grains into the market at subsidized rates, but, in many instances, the commissioners of agriculture or trusted aides of the governors sell the allocation papers to agents of the cartel and collect cash, in order to obliterate traces of the transaction.
An allocation paper for a state in the south-south obtained by Sunday Vanguard indicated that the state government paid N21, 600,000 as subsidized rate for 600 metric tonnes of maize, which an aide of the governor sold to the Ibadan branch of the cartel, far from where it ought to be released for purchase by the populace.
The allocation paper, dated May 9, 2008,with reference number 00833, signed by the Director of Strategic Grains Reserve, SGR, was presented to the Ibadan Silo Manager on May 14, 2008 for collection. The letter. entitled "Authority To Collect Grains", stated, "I am directed to inform you that,. ...(name of state withheld) has paid the sum of N21,600,000. for maize (600MT). You may wish to release grains accordingly on sighting of treasury receipt and original copy of allocation letter."
Sunday Vanguard reliably gathered that at least three states in the south-west, two in the south-east, three in the south-south and many northern states have sold their grains allocations to the cartel, leaving their populace to wallow in hunger and misery.
A Federal Ministry of Agriculture and Water Resources official, who decried the scandal, informed Sunday Vanguard that lack of tracking mechanism by his ministry and SGR have aided the diversion of grains allocated to states. He stated that the activity of the cartel was driving up the cost of grains and farm inputs like fertilizer, saying,
"As I speak to you, at least half of the grains released at subsidized rates to the states are already in the custody of these people. That way, they are always able to determine at what cost the end users buy the commodities. "They are able to exercise this grip and sell at their determined price by simply manipulating supply, hoarding when there is surplus, like the Federal Government's intervention through the strategic grains reserve allocation to states, and creating scarcity to keep their prices stable".
He blamed the political leadership in the states for fuelling this "vicious circle, because if the governors put their foot down that these grains must be released into the local market and put mechanism in place to monitor implementation, it will not only crash the prices of food stuff, it will also make it unattractive for this cartel to continue to act as middle men.
"But, unfortunately, we have a situation in which some state governors either use the allocations for political patronage by giving them to their cronies or out rightly selling the commodities themselves and pocketing the money, which translates into the twin evil of using state resources to pay for the grains and later sell and convert the proceeds to their personal use".
Meanwhile, the personal assistant to one of the south-eastern states governor was last week arrested and brought to Abuja for questioning by detectives of the FCT Police Command over the allegation of collecting N28 million for the state's grains allocation and attempting to sell off the fertilizer allocation valued at N45 million. Excerpts of police preliminary investigation, sighted by Sunday Vanguard, alleged, among others, that the personal assistant issued grains allocation belonging to the state government to one Abiodun Awobiyi.
The preliminary report alleged that the governor's PA met with Awobiyi in his (PA) office in his state Government House and agreed to sell 500 out of its 600 metric tonnes of the grains allocation at N46,000 per tonne.
According to the report, "the meeting was held on 13, June 2008." It noted further that after the meeting, an advance payment of N4,000,000 cash was made to the governor's PA by Awobiyi. The money, according to the preliminary report, was drawn on Intercontinental Bank cheque number 13909462 at its Wetheral Road Branch, Owerri.
A receipt on a piece of paper, acknowledging payment, signed by both the PA and Awobiyi, and witnessed by one Mr. Izuchukwu Ochonma, was attached as exhibit. On June 20, 2008, the preliminary report explained that another N10,000,000 cash was delivered to the PA in the governor's residence, where he was alleged to have informed Awobiyi that "he was handing it (N10,000,000) over to the governor and the chief of staff.
The N10,000,000 payment, according to the preliminary report, was acknowledged by the state Agricultural Development Project, marked "Commercial Service Receipt Book", number 0045075, indicating that, the sum covered 250 metric tonnes of grains".
The PA was further alleged to have received another N5, 000,000 cash in two installment on June 23, 2008 and June 27, 2008, while N4,000,000 cash was paid to him on July 4, 2008 and an Intercontinental Bank cheque of N300,000 was issued to Izuchukwu Ochoma, after which Awobiyi was given the letter of grains allocation to the state for presentation to the Ibadan Silo of the Strategic Grains Reserve, after paying a total of N28,300,000.
But a copy of the allocation letter, obtained by Sunday Vanguard, dated July 4, 2008, was not honoured because of noticeable discrepancies in the tonnage indicated in it, among others.
In the letter, 900 metric tonnes of maize valued at N32,400,000 was indicated for delivery to the state government, in addition to the fact that an unknown government official had already sold the state allocation to another buyer, apparently without the knowledge of the governor, prompting the schedule officer to refer Awobiyi to Abuja where he was arrested and detained for presenting a forged allocation letter.
The PA was consequently arrested in his state and brought to Abuja where he was alleged to have admitted selling the letter of allocation to Awobiyi. The PA was also alleged to have attempted to sell the state allocation of fertilizer for N45 million to Awobiyi in a letter of allocation dated July 4, 2008.
Though the letter of allocation allegedly signed by the state commissioner of agriculture directed the buyer to pay into the ministry's fertilizer account, domiciled at a branch of the UBA, the PA was alleged to have instructed Awobiyi to pay the N45 million into the account of one J.O. EDESON & SON, account number 6010176554, alleged by the PA to be operated by the state governor.
The FCT Command, pending the conclusion of its investigation, has since released the PA on bail.Contacted for comments, the chief press secretary in the Federal Ministry of Agriculture and Water Resources, Mr. Kingsley Agha, informed Sunday Vanguard that the ministry has no control over what the states do with their allocations of grains and fertilizer.
The police public relations officer at the FCT Command, a superintendent of police, Mr. Musa Ahmed, when contacted for clarification, told Sunday Vanguard that he could not comment on the matter because he did not have the facts of the case.
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