Minister Side-steps Rules in 3 billion contract

There is murmuring in the Forestry Sector over the manner Prof. Kasim Kasanga, Minister of Lands and Forestry awarded a ?3 billion contract for the supply of 200,000 grafted mango seedlings.

Conventional practice that ensures transparency, especially, given the amount of money involved dictated that the Minister should have put the contract on open tender and not hand over the contract to one company, Agrovets Limited. Again, the Minister awarded the contract when the Fund Management Board, the body set up under the Forest Plantation Development Fund, had not established the criteria and modalities for disbursement of the Fund from which the Minister drew the ?3 billion.

But Prof. Kasanga has defended his action.

In an interview on Tuesday this week, he said government was under pressure from farmers to demonstrate that the National Forest Plantation Development Programme, a Presidential Special Initiative under which the mango seedlings were procured, had taken off in the entire country. It could therefore not be frustrated by procurement procedures.‘(Besides), when prices are comparable with local seedlings what’s the need for wasting money to advertise when the company that was awarded the contract even subsidized it for us?’’, he asked rhetorically.

The Concord found from independent sources, though, that the price quoted by Agrovets compared to what pertained on the local market.

The contract was officially awarded within 72 hours but the distribution and planting of the mango seedlings has not been handled with the same sense of urgency the Minister had indicated as the reason for not opening the contract up.. The seedlings are still held up in the Upper East Region where Agrovets had delivered them after purchasing them from Burkina Faso.

Records of correspondence between the Minister and Agrovets Limited showed that on September 9th, 2002, Dr. H. A. Wemah, the Managing Director of Agrovets, wrote a letter to the Minister recalling the ‘several discussions (Prof. K. Kasanga / Dr. Wemah) regarding the supply and planting of improved mango and other seedlings. We are in a position to supply two hundred thousand (200,000) grafted mango seedlings (Burkina Faso type) between September and October…We offer these highly grafted mango seedlings at ?15,000 instead of the ?18,000 that they are currently being sold for in view of the quantity involved’’, Dr. Wemah said.

Three days after, on September 12, Prof. Kasanga responded, accepting the offer. ‘I wish to confirm that this Ministry is ready to purchase two hundred thousand (200,000 grafted mangoes (Burkina Faso type) between September and October, 2002 for distribution to identifiable groups in support of the Governments afforestation programme. We also accept your price of ?15,000 (Fifteen Thousand cedis) per seedling’, the Minister wrote.

During the interview, which was also attended by Dr. Wemah in the Minister’s office, Prof. Kasanga repeatedly dismissed suggestions that by handing down the contract to one preferred company, he might have had a personal interest.

He said although Agrovets got the contract, everything was done above board and that he formed a three-man Committee that included himself and two others in the award of the contract. Asked how he got to know about the Ministry’s need for the supply of the mangoes, Dr. Wemah said he had been dealing with the Ministry regularly and therefore learnt about it. “Anyone in the industry should know about it so it was not as if I have benefited from any insider trading.”

The Forest Plantation Development Fund was established by an Act of Parliament in 2000 and was amended this year. The fund comprises a levy of between 10%-30% from ‘Air-Dried’ timber exports which currently has ?70 billion in its accounts. Under the legislation setting up the Fund, a Fund Management Board (which has now been established), is to determine the criteria and modalities to administer the Fund. It is from this Fund that the Ministry of Lands and Forestry has started disbursing even though the Board has not completed the criteria and modalities for its expenditure.

Prof. Kasanga has so far applied to Mr. Yaw Osafo-Maafo, Minister of Finance to be allowed to withdraw ?17billion from the Fund to enable his Ministry and the Forestry Commission meet some commitments in respect of government’s Afforestation Programme. The request has been granted.. When asked why he was spending money from the Fund when the Fund Board of which he is not a Member, had not completed working on the criteria and modalities for disbursement, Prof. Kasanga said the Board would take sometime to develop the criteria and modalities and the Ministry could not wait because there are urgent things to be done.

‘There were farmers whom we owed several millions of cedis and these debts have been outstanding for sometime. They were getting frustrated so we had to pay them from the Fund’, Prof. Kasanga said.

Apart from the ?3 billion that has been spent to procure the mango seedlings, other fairly substantial expenditures had been incurred from the Fund.

The Minister gave the following expenditure breakdown incurred so far from the Fund when he fielded questions from Members of Parliament recently. ?6.25 billion to local communities and farmer groups contracted to produce 25 million seedlings; ?8.75 billion to over 72,000 people (including 25,000 farmers) who were engaged to cultivate 19,000 hectares of forest plantations within degraded forest reserves throughout the country; ?600 million for the supply of 5,000 pairs of Wellington boots, 5,000 cutlasses and a number of nursery equipment including wheelbarrows given to some farmers and local communities throughout the country. A further ?5 billion and ?1 billion has been earmarked for fire prevention and plantation maintenance during the dry season and for the purchase of seedlings respectively, Prof. Kasanga told the House.

The Minister plans to spend more money from the Fund.