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Cassava bread fund: Going way of failed interventions

By Gbenga Akinfenwa
03 September 2017   |   2:10 am
After years of foot-dragging on disbursement of the major portion of the N10b first tranche release from the Cassava bread fund by the Federal Ministry of Agriculture and Rural Development (FMARD), Bank of Industry....

• BoI Has Breached Terms, Conditions Concerning The Fund- NCAPMA
• Govt Should Prevent Truncation, Summersault Of Policy- Master Bakers

After years of foot-dragging on disbursement of the major portion of the N10b first tranche release from the Cassava bread fund by the Federal Ministry of Agriculture and Rural Development (FMARD), Bank of Industry (BoI) and other stakeholders involved in the project, the scheme appears to be going the way of previous failed interventions of government in food and cash crops production.

Concerned bodies, which include the National Cassava Processors and Marketers Association (NCAPMA); Master Bakers and Caterers Association; and National Cassava Growers Association, appear to have resigned to fate due to lack of information on the fund. Those who spoke with The Guardian claimed the fund has been siphoned or probably stashed away in some accounts where other benefits are derived. 

The fund, initiated in 2012 and released in principle in 2013, was meant for farmers, bakers, processors and others in the cassava value chain, to enhance productivity. According to report, the disbursement to individuals would be need-specific.

But five years down the lane, reports from beneficiaries and stakeholders are not palatable, as majority has tagged the project a ‘fraud’.It was learnt that the approved work-plan of the initiative as spelt out, was to address the following components: Development of robust Cassava Root Supply Chain- 6,400 hectares under development, 5,000 hectares would be established under the Initiative’s Mechanisation programme,‬ 29,500 hectares would be established by small scale farmers and linked to SME’s for adequate supply of cassava roots and at the right price; support to High Quality Cassava Flour (HQCF) producers through equipment support, provision of working capital and institution of guaranteed minimum price;‬ equipment support and capacity building for Master Bakers to improve the cassava bread production efficiency;‬ and social marketing to create awareness of the cassava bread and ensure its acceptability by Nigerian populace.‬

Based on these, a first tranche of N9.999b, from the over N50b that accrued to the account managed between Nigerian Customs Service and Federal Ministry of Finance, was approved by former President, Goodluck Jonathan to execute the following work-plan-Development of Robust Cassava Root Supply Chain-N4.72b; ‬Support to HQCF producers through equipment support-N350m; provision of working capital-N893m; institution of guaranteed minimum price-N450m; Equipment support and capacity building for Master Bakers to improve the cassava bread production efficiency-N2.379b; and Social marketing to create awareness of the cassava bread and ensure its acceptability by Nigerian populace-N1.207b.

As captured in the approved work plan, development of robust cassava was targeted at making available adequate roots at the right price. Towards this end, N2.14b was domiciled with Bank of Agriculture (BOA), to establish 29,500 hectares of cassava. The balance of N2.58b was directly to be managed by FMARD to develop-6, 400 hectares under development;‬ and 5,000 hectares under the Initiative’s Mechanisation programme.‬

According to The Guardian investigations, while BoA has nearly disbursed its portion for Primary Production of Cassava; BoI is low on disbursement with attendant implications of ‪N4.7b fund disbursed towards adequate root at right price of cassava meant for HQCF production being wasted due to no off-take by Cassava Processors expected to utilise same when the Cassava matured.
In January 2014, stakeholders, who were determined to take their fate in their hands by ensuring that the fund does go the way of similar intervention funds, convened a meeting at the Federal Institute of Industrial Research, Oshodi (FIIRO), to seek the bank’s explanation on the disbursement of the fund.
The concerned bodies tasked the Federal Government to set up a powerful monitoring committee to ensure judicial use of the fund, to avoid defaulters and saboteurs.

Representative of BoI at the meeting, Idris Oluwa, not only assured farmers and processors of the bank’s readiness to disburse the fund, he promised that if they meet up with requirements laid down to access the fund, they’ll get it within two weeks (14 days).He also allayed fear of stakeholders on illegal diversion of the fund. After the meeting, stakeholders claimed they never heard again from BoI anything relating to the disbursement.
But in August that year, there appeared a silver lining, when the former CEO/Managing Director of BoI, Mr. Rasheed Olaoluwa, was newly appointed. He promised during his courtesy visit to Director-General, FIIRO, Prof. (Mrs.) Gloria Elemo, that disbursement of the fund would be done within the shortest possible time.He disclosed that the Federal Government had approved the first batch, comprising of 35 persons, as at the period. But since then, the waiting game continues.
Stakeholders, who spoke with The Guardian, claim the whole fund of N3.443b with BOI risks being lost through non-release of fund/under-funding of SMEs, thereby short-circuiting achievement of milestone required to generate cash flow for repayment of the little being untimely disbursed.From investigation, the entire Cassava Bread value-chain is threatened as inadequate HQCF supply is already undermining the Cassava Bread Policy with ripple effects. ‬
Wheat Flour Millers are using that as excuse for non-compliance with minimum of 10 per cent inclusion of HQCF in wheat flour, due to lapses in supply chain. ‬The hope of SMEs producing HQCF risks being dashed due to slow approach of BOI to disbursement of the fund, which is undermining the spirit of keeping the fund with them. ‬
There is socio-economic implications as jobs meant to be created, which are now being lost as a result of non-release of fund to SMEs.According to farmers who spoke with The Guardian, two years of scarcity means high prices for consumers. ‬Also, other funding deployed to open mechanised cassava farms stand the risk of being lost, as most of the cassava is fast maturing with no off-take. ‬
In a chat with the National Cassava Processors and Marketers Association and Master bakers Association of Nigeria, who are the direct beneficiaries of the fund, they confirmed to The Guardian that BoI and FMARD are yet to fulfill their promise on full disbursement.
They noted that the terms, conditions and roles of BOI on the fund, were grossly breached, especially on timelines of disbursement of the fund, as mutually agreed in the MOU. They added that cases abound when SME ‘s were issued offer letter and conditions precedent to disbursement met, but BoI did not release fund within the stipulated 14 days.
While wondering why FMARD, especially under President Buhari’s administration has failed to call the bank to order, they call for the review of the MoU.
They want government, to as a matter of national importance, prevent the truncation and summersault of this policy, adding that all the funds for the items, should be implemented immediately, else the N4.7b used to plant cassava will be wasted.
The body called on the Federal Government to prevent another Local Content Policy summersault with attendant wastage, misappropriation, diversion of funds and or illegal brokerage on the funds by banks at the expense of Nigerians, and to also ensure that the Composite Flour Bill, which some have continuously been working against, should be passed. ‬

The common questions on their lips begging for answers are: “Can the ministry of Agric tell Nigerians what they have done with the N450m Guaranteed Minimum Price for cassava, which has been with them since January 2014 and the N1.207b Social marketing fund to create awareness of the cassava bread?

“What has Federal Government done with the additional levy on wheat of about N150b from 2013 till date, which was supposed to go to the cassava bread fund?”

The Guardian was on the trail of the BoI for four days to get response, but nothing came out of the efforts.When the BOI Head of Corporate Communications, Hadiza Olaosebikan was contacted, she told The Guardian to send an SMS, but when she was called later, she denied seeing the message, which was re-forwarded to her. Calls later made across to her were not picked.

She later told The Guardian she was indisposed and not in office, with a promise to forward the response immediately she gets it. She is yet to do that two weeks after.

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