Admarc board by-passed in ‘maizegate’ – Masumbu
Chairperson of the board of directors for State-produce trader Agricultural Development and Marketing Corporation (Admarc), James Masumbu has said the chief executive officer Foster Mulumbe and his team by-passed the board in the controversial Zambian maize procurement saga.
Masumbu, a lawyer who has been retained as chairperson after the new board was appointed by President Peter Mutharika this week, told Times Radio on Tuesday that the board was not consulted in the import deal.
“The board was only informed about plans to borrow money from the PTA Bank for the purchase of maize,”Masumbu told the radio.
Masumbu said Mulumbe and his team did not consult the board regarding who should supply the maize and at what price.
“The board was consulted to allow Admarc to borrow money from PTA bank. Regarding what happened next after that process, we were not consulted,” Masumbu said.
President Peter Mutharika has since set up a commission of inquiry to probe matters surrounding the import deal.
But Parliamentary Committees—Agriculture, Irrigation and Water Development and Public Accounts— are calling for Admarc boss Mulumbe to be suspended until the investigations are through.
The parliamentary Public Accounts committee is also calling on the inquiry to be “inclusive” by incorporating members of the civil society, parliamentarians and other stakeholders.
Malawi government may have lost billions of kwacha out of the K26 billion it borrowed from PTA bank to enable Admarc to buy maize from Zambia through Zambia Cooperative Federation (ZCF).
However, Admarc engaged a privately-owned Zambian company Kaloswe Commuter and Courier Limited which played the role of middleman in the deal.
Admarc reportedly paid about K26 billion which government borrowed from the PTA Bank for the purchase of the maize which is about K9.5 billion more than the estimated K15 billion it could have paid had it bought the maize directly from the Zambian Government.
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A few points to note on this so called maizegate scandal
1. Masumbu and Board were informed about plans to borrow money from PTA Bank. So they are quite aware there was money to be borrowed from PTA.
2. By his own admission what was this money for? To purchase maize.
3. What was his Boards input therefore going forward? He does not say.
4. Operational matters in as far as standard organisational arrangements are concerned is the preserve of the Chief Executive/Managing Director of the organisation. In this case Mulumbe in his own wisdom decided to buy maize from Zambia. Board gives direction only which direction Masumbu is not telling us what counsel he gave to Mulumbe.
5. Mulumbe in his own wisdom decided to do so through a third party which cost Malawian government an overrun of over K9bln.
6. Who then is wrong here? Mulumbe then has to answer the tough questions how he arrived at settling for the private supplier in Zambia. If he’s reasons are not convincing then he is held accountable and he has to face the music.
7. Chaponda does not feature in all this. Even if he told Mulumbe to purchase from a private firm, Chaponda will easily throw Mulumbe under the bus because the buck – operational oversight – rests with him. Chaponda does not feature here ataaa!
“The board was only informed about plans to borrow money from the PTA Bank for the purchase of maize,”Masumbu told the radio.
Masumbu said Mulumbe and his team did not consult the board regarding who should supply the maize and at what price.
“The board was consulted to allow Admarc to borrow money from PTA bank. Regarding what happened next after that process, we were not consulted,” Masumbu said.
– See more at: http://www.nyasatimes.com/admarc-board-passed-maizegate-masumbu/#sthash.GKOFClBQ.dpuf
Chonde a Boma musamuopseze Board Chair kuti anene zofuna zanu. Chilungamo chake ananena kale pa Times Radio tonse tinamva. Zikomo
just to add thought to this debate. I find Masumbu to be a brilliant lawyer and risk taker. The fact that he has said the board was bypassed just shows that stakes in this issue in that it was ‘illegal’ in that if company decision makers were not involved then its illegally sanctioned and if Judge Msosa is level headed the Board Chair is just telling the nation that.
Those people who do not see nothing wrong. This is fishy from the start. Here should note these things:
a) ADMARC decision makers are saying they were not involved in the deal, then who gave management power to transact such a huge deal
b) ADMARC dealt directly with ZCF and why need a middleman to charge this country (30% of cost) MK9bn
c) Judge Bakuwa died negotiating this deal which was management sanctioned
d) MERA CEO and DoFA were suspended to pay way for investigations and ADMARC is refusing to do the same in all fairness.
Alright. I really think all we need is clarification. I personally doubt if there were any wrong doing in this procurement. When procurring locally, ie from local suppliers, during the same period (May to November 2016), ADMARC was paying MK250 a kilo for this staple grain. Now, considering the much talked about MK26,000,000,000 (of course, at the current exchange rate), the maize must’ve been i mported at MK260 a kilo inclusive of transport (from what we are told)! Now, does this seem unlikely? How likely is it that it could have been bought at a lower price than this? Now, further assumming that the price could have been the MK15,000,000,000, the iported maize should have cost, including transport, MK150 a kilo! Really? Just how likely could this have been? As we go along casting doubt over this alleged mess, we should think along those lines as well. That way, we’ll be a bit more realistic in our arguments!!!
Chief your anlysis indicates that you are a shallow thinker.The issue is simple here. Goverment overspent by 9.5 billion coz of using a middle man instead of dealing straight with the Government of Zambia.The question is WHY did ADMARC prefer using a middle man than dealing straight with the Govt Of Zambia.Something smells fishy here.
If you want to solve the problem get to the loot cause of the problem ok, goat bears goat, if this is a dude board chair then some one who appoint this dude is a dude ..Now what to do next , down with the dude that appoints board chairperson/s, down with the dude that appoint rotten ministers then It will make sense when you want to bring sanity in the process of putting the right people in the right positions.
Masumbu should be a stupid lawyer.
Are you serious telling us today that you were bypassed.
Are you serious really.
So if that was the case, what did you do.
You were waiting for the media to unveil it.
You were indeed educated by mistake.
Tikamati boma ili muli kuba kwadzaoneni , inu mukutsutsa sizimenezi? A PAC tiyenawoni agwidwe basi.
This deal was sealed by the Minister and all other suppliers were ignored or left out without proper reasons. Anduna ndinanena zikutsamwani lero ndiizi.
Where the maize is bought from is an operational matter. The board approved the principle and that was enough unless if ADMARC has an executive board or its management were specifically requested to advise the board at every stage. I am sure ADMARC has a board meeting every quarter and this should have been reported.
Mr Masumbu, are you telling us that the management lied to the board as well? If so, then recommend to DSB for the CEOs immediate suspension to pave way for investigations.
I hope Justice George Bakuwa did not die because of this impending scandal as he was the ADMARC company secretary and had gone to Zambia to negotiate the same.
You have a tough job Mr Masumbu and we are waiting to see of what mettle you are made of.
nkhani yatha,mumaidziwa DPP inuyo,mukunamatu.Lirani mutopa nokha
Is that real a board chair giving excuses here. Were you in Malawi in the past nine months when the option of a maize supplier was being discussed? Maybe your hearing is impaired by the share that you got.
Just to give you benefit of doubt, what tell us what corrective measure did you take as a board chair, because you are the one who makes final decisions in an organisation.
Otherwise you are implying that your CEO was getting instructions your superiors.
Having observed that, what’s the next move Mr. Chairperson? Take note that all eyes are on you, your urgent action on this scandal is imminent, the earlier you clear this mess the better. We are closely monitoring what course of action the Board will take. We believe that you wouldn’t want to tarnish your professionalism and ethics by stooping so low to shield someone. Go, goo, gooo Mr. Masumbu and show the nation that you can do the job without fear or favour by suspending everyone involved in this maizegate so as to pave way for investigations. I rest my case.
Whether Masumbu is a lawyer or not we are not interested what we are ibterested in is performance. Has this board chair done enough to steer admark ashore to deserve a return on his position? Are these not political appointment? What caught Muntharika’s impression that this chair person is still relavant to admark after all the mess the grain marketer has gone through? We can not go anywhere with this leadership .org Muntharika.
shame!!!!!