GMB posts $208m net loss for 2017

HARARE - State grain utility Grain Marketing Board (GMB) posted a net loss of $208 million last year that it attributed to the impact of a government-sponsored Command Agriculture that offered a maize subsidy.

GMB general manager Rockie Mutenha told the parliamentary portfolio committee on Lands, Agriculture and Rural Resettlement yesterday that government’s decision to buy grain at $390 per tonne while selling it at $240 per tonne caused the shocking loss.

“The audited financial statements reflect an accumulated loss position of $208 968 178,” Mutenha said to the bemused committee.

“This has been as a result of pricing policy where GMB is buying maize at $390 and selling it to millers at $240 to $270 per tonne.”

The GMB received over 500 000 tonnes of maize from farmers who benefited under Command Agriculture and the Presidential Input Scheme.

The Grain Millers Association of Zimbabwe, a grouping of the 100 biggest private millers, had agreed to buy 800 000 tonnes of maize from the State for $194 million last season, or $242,50 a tonne.

At this price, the government would lose $147,50 for every tonne it bought from farmers and sold to these private millers, totalling $118 million.

Mutenha, who was taken to task by the committee over his appointment and relationship to former Agriculture minister Joseph Made, said GMB’s overheads were not fully recovered by storage and handling fees charged to Treasury.

“The current rates are at $5 per tonne for handling fees and $3 per tonne per month for storage fees against full recovery rates of $22,26 per tonne and $10 per tonne per month respectively. The rates were last reviewed in 2009,” he said.

Mutenha told the Justice Mayor Wadyajena-led committee that GMB balance sheet is not liquid as a result of outstanding fees amounting to $68 million.

“Going forward, in consultations with the accountant-general and auditor-general, the accounting system will be realigned to recognise as income from government in respect of direct operational costs such as transport and storage resources to mitigate against the gravity of losses being incurred,” he said.

He added:“If the money was to be paid, there will be excess cash of $32 million after liquidation short term debts to amount to $36 million.

“The short term debts are made up of the following; debts carried over from the Zimbabwe dollar era has outstanding balances of $14 661 429 for maize and wheat not paid for and fertiliser paid for by farmers but not collected due to shortage; payroll arrears amounting to $16 601 811 made up of medical aid, pension fund, housing fund, salary arrears and (Zimbabwe Revenue Authority) Zimra among others and amounts owing to sister parastatals such as Zinwa, Zesa, and local authorities amounting to $4 830 540,” Matenha said.

He proposed that Treasury Bills be issued against outstanding handling and storage fees from Treasury and the balance be paid as cash to the GMB and said accumulated loss be written off against capital contribution.”

Meanwhile, the GMB board and top management will go under Parliament scrutiny after Wadyejena’s committee demanded that they bring their curriculum vitae (CVs).

They also wanted to know the circumstances that led to his (Mutenha) appointment as general manger.

Mutenha squirmed under tough probe, as the committee members who include Norton independent MP Temnba Mliswa, MDC MP for Zengeza West Simon Chidhakwa and Zanu PF MP for Bindura South Remigious Matangira grilled him over partisan distribution of inputs, corruption by GMB officials who demand money from villagers to transport inputs for distribution and also lack of a clear plan to resurrect the parastatal.

Last year, Mutenha was under the spotlight after going for a lengthy medical layoff — two months after taking control of the strategic parastatal.

 

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