Buyers 'should be prosecuted' over Malawi tractor scandal

Will Green is news editor of Supply Management
17 November 2016

Procurement professionals in the Malawian government should be prosecuted over a scandal involving the purchase of tractors intended to improve farming productivity, according to a watchdog.

In a scathing report the country’s Office of the Ombudsman said the procurement process by the Ministry of Finance, Economic Planning and Development (MoF) for the 177 tractors had “all the marks of either illegality or irregularity”, with no minutes of Internal Procurement Committee (IPC) meetings and no bid documents.

The contract was awarded to Apollo International. “In the absence of the said minutes or any other information to prove otherwise it has been difficult to conclusively state whether the process of awarding the contract to Apollo was legal or not,” said the report.

The ombudsman said the tractors, bought with a $50m loan from an Indian bank in 2011, contained “archaic technology from the 1970s” and “almost half of the tractors are not functioning properly or have major faults”. Equipment bought with the loan was warehoused for up to five years.

Ombudsman Martha Chizuma-Mwangonde criticised the “illegal” decision by the Ministry of Agriculture, Irrigation and Water Development (MoA) to sell 100 of the tractors to commercial farmers at far below their market value, and she said members of the MoA’s IPC, established to evaluate bids, benefited from the sale.

“The officials who were members of [the] IPC [who] presided over the sale of the farm machinery and benefited from the sale should be prosecuted in accordance with the Procurement Act,” said Chizuma-Mwangonde, who said she could not discover how much money had been made on the sale.

The ombudsman also criticised political oversight of the loan agreement, which needed approval by parliament but the process was rushed.

Under a scheme to improve agricultural techniques the tractors are hired out to smallholder farmers, who are responsible for 85% of farming in Malawi.

“At the rate the hiring scheme is going, particularly cost of maintenance and frequent breakdowns, the tractors will not outlive the loan repayment period,” said Chizuma-Mwangonde.

“In the end, the next generations will be repaying loans that neither they nor their ancestors benefited from. The present generation is toiling on the farms while the [is] future overburdened for nothing. This is not justice.”

Among her recommendations Chizuma-Mwangonde said the MoF should not be a procuring entity, reports should be prepared on the poor performance of equipment and public apologies should be made.

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