M5 million lost in farming deal

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MASERU — The Ministry of Agriculture paid a whopping M5.5 million for agricultural equipment it never received, according to a damning report by parliament’s Public Accounts Committee.

The government could have effectively lost the money because Mechanized Farming South Africa, the company that was paid in advance to supply the equipment, is now being liquidated.

The company was supposed to have supplied combine harvesters late last year but until now nothing has been delivered and there seems to be no effort to recover the money or to get the equipment.

The committee’s report, released last Friday, says the ministry also violated the government’s procurement procedures when it paid Mechanized Farming South Africa in advance.

The ministry’s officials, the report says, did not seek approval from the Ministry of Finance and the Accountant General as stipulated by the Financial Order 1988 and the Financial Regulations 606 of 1973.

This is apparently the same issue Mohale Sekoto, the late principal secretary of the ministry of agriculture, was due to answer to when he allegedly committed suicide on June 7. Sekoto was scheduled to be grilled by the committee about the combine harvesters’ scandal when he was found dead in a toilet at his office.

He had a gunshot wound at the back of his head and there were suspicions that he could have been shot.

An inquiry into his death is currently ongoing and evidence presented by the police so far suggests he could have committed suicide.

The report says it was Sekoto and the Director of Crops, Lisemelo Mapalesa Mothokho, who approved the transfer of M5 438 800 from a Standard Lesotho Bank account on April 10 last year to pay the company.

Sekoto and Mothokho’s decision to pay Mechanized Farming South Africa in advance was “contrary to the law”, the report says.

“Whilst the Public Accounts Committee was looking into the question of the purchase of the combine harvesters, one morning it learned that the chief accounting officer, Mr Mohale Sekoto, had taken his life,” the report notes.

“This happening left Mrs Lisemelo Mapalesa Mothokho the co-signatory of instruction for the release of the funds by Standard Lesotho Bank to answer questions which could no longer be answered by Mr Sekoto.”

The report adds that after the committee raised the matter with the agriculture ministry’s acting principal secretary a loss report was submitted to the principal secretary of finance on November 11, 2011 “confirming that the combine harvesters have not been supplied and thus effectively recording nugatory expenditure by the Ministry of Agriculture”.

The committee says it “firmly believes that the public funds in this matter were lost only because the Finance Order 1988 read with Financial Regulation 606 had been breached and that the instructions of the PS Finance and Accountant General were ignored by the late chief accounting officer and the director of crops”.

“The Public Accounts Committee holds a strong view that stern action be taken against officers who do not take notice of either the law governing regulations protecting the maintenance of order and sound financial practice.”

Responsible officials should be surcharged, the report recommends.

The committee also raises serious concerns over the non-payment of loans received by farmers under the Block Farming Programme.

It says as of September 23 this year the farmers who benefited from the scheme during the 2006/2007 and 2009/10 farming seasons owed M79 578 223 in outstanding loans.

Because the government had guaranteed the loans it has had to pay Standard Lesotho Bank, the financial institution that disbursed the funds, to cover the delinquent loans.

At the same time there is no guarantee that the farmers will be able to repay their loans.

One of the biggest beneficiaries of the scheme was former Assistant Minister of Agriculture Ramootsi Lehata who has since been appointed Minister of Public Service.

Lehata has admitted he has not repaid the loan.

In the 2007/2008 winter season Lehata’s loan accounted for 17.6 percent of the funds loaned to all the farmers.

Lehata borrowed M336 324 for the 2007/2008 for the summer cropping season but only repaid M8 000.

That means Lehata still owes M328 324.

But that did not stop him getting more loans.

In the same year Lehata took a loan of M1 682 739 and paid back M30 538 and was left with a balance of M1 652 201.

The minister’s total outstanding debt is M1 980 526.

Speaking in an interview after the scandal broke in September last year, Lehata said he could not repay the loan because his crops failed after he planted late.

“In the first year I did not get the inputs. I planted late and my crops failed,” he explained.

“That is why I did not repay the loan.”

“In the second year I got all the inputs on time but still faced problems because I had to repay two loans,” Lehata said.

Lehata said he was not sure how much he owed under the scheme because he never signed an agreement with Standard Lesotho Bank.

“They say we are supposed to pay back the money but we (block farmers) did not sign anything with the government or the bank,” he said.

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