Aminu: Faulty process, poor monitoring responsible for failure of ABP

The Chief Executive of A. A. Ibrahim and Co. Integrated Rice Mill, Alhaji Abdulkadir Aminu, in this interview with ABBA ANWAR, explains why farmers delay the repayment of loans obtained from the Anchor Borrowers’ Programme, and what government should do to improve the situation. He also alleged that political patronage has contributed largely to setting the scheme back.

By the last count, at least three state governments have either commenced legal processes or have prosecuted defaulting farmers under the CBN’s Anchor Borrowers’ Programme. What does this kind of development spell for the future of the programme and agriculture in general?
First and foremost, what we need to understand is how the loan is being distributed to farmers. The problem under this process emanates from the commercial banks through which farmers get the loans from the Central Bank of Nigeria (CBN). Sometimes you will find out that those commercial banks do not give out what should be given to farmers on time. So, that in itself is damaging the whole process, and the aim of the programme. You know CBN gives to farmers through commercial banks, it is these banks that pay for inputs and other implements on behalf of farmers. Farmers can only access what they need for labour and other things, which, according to experience, can only be available after banks have paid for those things as they liaise with companies that would supply such implements.

If you look at it critically, you would come to understand that apart from the faulty process at some points, there is this issue of political patronage being glued to the scheme. In some states, political loyalists have greater chances of getting such loans than real farmers. Then, how do you expect a prompt repayment or even repayment of such loans from the beneficiaries?This and similar experiences would not augur well for the scheme, and probably similar schemes in future because the failure to pay back the loans would simply mean farmers are not ready for this and similar farmer-friendly programmes.

But at the same time, there is no gain if the government resorts to dropping similar interventions as a way of solving the challenge. Yes, people defaulted, but that cannot be enough reason for government to be deterred. This is part of the problems affecting many government policies or empowerment schemes.

If a programme fails, government should study the project, evaluate it, and identify reasons for such failure. Running away, or dropping such programmes will not augur well for national development. For lengthy periods, when a government programme fails either by commission or omission, government just abandons such a scheme. If we keep on doing that, when are we going to sort out things?

I, therefore, advise that government should accept the defeat in disguise, try its best, and evaluate reasons behind this unnecessary default, and build on it. Government should monitor closely to find out what part of the due process that is missing in the disbursement of the loans; it should closely monitor areas that are critical when giving out the loans. The original channel from CBN down to potential beneficiaries should be followed critically. Government should also show the people that government money is not and cannot be treated as wasted resources.

Many are of the opinion that the farmers’ disposition may discourage government and others from planning sundry interventions for Nigerian farmers? Do you agree with this?
That may be possible. But I still want to stress that government should, right from day one, make people understand that such loans are not, and can never be their reward for helping to elect the ruling party. Not only that, it should also make sure that, all stages of acquisition of loans, use of loans and repayment system are closely monitored and evaluated.

Reward and punishment must be implemented at all stages of the loan process. If you say farmers’ disposition, then where do you leave banks’ disposition also?  What of issues surrounding political patronage?  These are issues that must be looked at, before we start talking about farmers defaulting on the loans.

One of the aims and objective of the scheme was to facilitate the eradication of poverty among smallholder farmers and increase output. Would you say that this objective has been achieved?
Yes. That has been achieved in a way because our farmers now realise that there is much benefit in what they have been doing for decades; that farming is a money-fetching venture. If in the past they were producing at a subsistence level, with the Federal Government’s economic diversification policy, we have come to understand that this is an easier way of eradicating poverty.

It may interest you to know that there are also greater numbers of people that were not farmers before that have now ventured into farming and are making profit. I know of people, who abandoned what they were doing before and are now serious farmers.

When things are re-framed for the better, I am assuring you that this objective of poverty eradication will come to stay. What I am also thinking of is that some people are still of the view that government resources can be frittered and the culprits walk away scot-free. Our people have developed this to be a culture. There were similar things or schemes in the past, where people collected and refused to pay back. What followed then? It was just long grammar at play. That is why I am saying government should force people to understand that this one is quite different from other schemes. The era of long grammar and going away with government money should be gone.

Some farmers are also alleging that the conditions for the repayment of the loan are quite stringent. What do you know of the conditions, and would you really say they are stringent?
What are the conditions? The single condition I am aware of, which will also allow you to repay the loan, is when you bring the farm produce you get paid.  The crisis we have in this area is, there is already a problem in the acquisition of loan, and the process to some extent is faulty. Then what conditions are you talking about?

Stringent in what sense? I am yet to grasp what that means. When you talk of stringent conditions, then you are indeed referring to the real farmers, who collected the loans very late into the planting season.

Are there other methods that the government should adopt that would compel defaulting farmers to repay their loans, some of which are over- due?
I think this method of trying them before mobile courts is a good start, and a way of forcing them to pay back what they collected. That will also deter them from seeing such loans as largesse from government, or as a reward for their voting for the ruling party. Another method that could help along that line is putting in place a strong monitoring committee that would include both government representatives and those of farmers as members. The work of the committee would be to monitor the use of the disbursed loans. It would be the job of the committee to know those who are availed loans, through what process, under what conditions, and how farmers are utilising the loans. Issues of this nature must be monitored closely to avert a repeat of the problem we are facing now.

Some are of the view that there was not enough enlightenment campaign to intimate farmers that the loans were repayable; hence some of them saw it as a reward for voting for President Muhammadu Buhari in 2015. What is your take on this?
I think it is not true that there was no enough awareness creation. There was, only that people still believe it was going to be business as usual. But with the mobile courts in place, they would have a rethink. The greatest bottleneck here is the fact that it has become a tradition that when a particular programme fails, the government simply abandons it, instead of looking at it critically, reviewing it and proffering solutions. Government should revisit the way it is facing this and similar programmes.

It is common knowledge that some of the loans were being diverted to other ventures. Were there enough checks in place to guard against this?
The question goes beyond how loans are being diverted, but how such loans are being secured is the most important issue to discuss here.