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Gvt Defends M41,8 million fertilizer deal

The Prime Minister’s office has defended the government’s decision to procure fertilizer worth M41,8 million without going to tender, saying there was simply no time to follow  requisite procurement procedures before the onset of the 2022/23 cropping season.

Minister in the Prime Minister’s Office, Limpho Tau, underscored the government’s rationale in bypassing normal tender processes in awarding  the lucrative project in an interview with the Lesotho Times this week.  He spoke to us as it emerged that opposition parties are sharpening their knives to try and challenge the project when parliament reopens this month.

They want to use it to try and stain the RFP which was elected on an anti-graft platform, among other things.

The opposition parties are particularly miffed by reports that Agriculture and Food Security Minister Thabo Mofosi had prior business dealings with, Kynoch, the company  awarded the lucrative project.

Minister Mofosi has never publicly addressed the allegations even though he had once promised to do so, further fuelling the opposition parties’ pique.

But Mr Tau insisted in an interview this week that everything had been done above board.

Mr Tau also disclosed that Prime Minister Sam Matekane would not be establishing the  Office of First Lady because he saw no need for it and considered it “irrelevant”. Instead, the resources saved in avoiding the office would be used to help the needy (see story below).

Mr Tau said the decision to bypass tender processes in the fertilizer project had not been Mr Mofosi’s own but a collective cabinet decision.

“The government was running against time ahead of the cropping season which was already underway,” he said.

Mr Tau said  immediately after the November 4 2022 swearing-in ceremony of Prime Minister Matekane’s 15-member cabinet, the premier had summoned his ministers  to their maiden cabinet meeting to discuss agricultural issues and the upcoming summer cropping season. These were vital issues as Lesotho must improve agriculture to achieve food security.

The meeting had noted that only five weeks had been left to the 15th of December,  the probable cut-off date to plant maize, Mr Tau said.  Cabinet had then arrived at the “unpopular decision” to procure the fertilizer consignment direct from Durban-based manufacturer Kynoch at the cost of M41.8 million inclusive of transport.

Mr Tau insisted that this plan had saved the government an estimated M42.2 million of the M84 million which had been earmarked for the procurement of the fertilizer.

“Had we followed the normal procurement procedures, we would in fact have had to expend the M84 million…,” he said.

Still the decision to bypass tender processes had proved contentious, not only from the opposition, but from within the RFP itself with some party officials questioning its basis.  Critics say even in an emergency situation, a semblance of competitive bidding must be followed. There are many fertilizer suppliers who could have been invited to submit bids and the cheapest selected at short notice.

Mr Tau insisted everything had been done in the right way.

“We became government on the 4th of November 2022, and you will recall that immediately after the swearing-in of ministers, the Prime Minister summoned us to a cabinet meeting in which agriculture was top of the agenda. It was his key priority as he came into power just as the summer planting season was left with five weeks or so. Usually the summer planting for maize, especially in the lowlands and throughout Lesotho ends on the 15th of December. Thereafter you cannot plant maize otherwise your yield will surely be affected,” Mr. Tau said.

“So, we were faced with a tough decision, with time not being on our side. We had to decide whether to procure locally or directly from the manufacturer for all the summer season inputs including fertilisers, particularly for the low-lying areas. Mountainous areas and the foothills were already behind time leaving us with not much of a choice. But at the end of the day, we decided that we could put in the soil hybrid seeds that ripen quite quickly. Within ninety days your maize catches up. So, we procured inputs so that those who wanted to plant could still do so.”

Had the government procured the fertiliser locally,  it would have been impossible to get it in time  for the summer cropping season, Mr Tau said.  By procuring locally,  he meant  inviting bids that would have resulted in the appointment of a   Lesotho company, or companies, who he said are mostly middlemen, and who would have had to then go and source the products externally as none of them produce here. That would have created long untenable delays, he said.

Normal procurement procedures also involved prolonged processes like cooling off periods for tenderers with grievances to raise and forward them to the ministry.  There was simply no time for that.

“So, we decided that we needed to procure whatever we could. The fertiliser would not have arrived on time if we had followed normal tender processes…..In fact we would perhaps not have received it by now, when the rain season is almost over….It would help if all and sundry can understand this and not make a mountain out of a mole hill….”  Mr  Tau said.

Mr. Tau said the government had also consulted extensively with agriculture ministry extension officers on an number of issues including the quantum of inputs needed.

The fertiliser alone had thus cost M38 million with logistics and transport accounting for the other M3.8 million. As a result of the “competitive” deal sought, there were lots of cost savings for Basotho who could then acquire a bag of fertiliser for M149 instead of the usual M384, thus saving an estimated M235 per bag.

While previous government had bought fertilizer for around M28, 000 per tonne, the Matekane government had bought it at between M13 000 and M15 000 a tonne directly from South Africa, creating a lot of cost savings, said Mr Tau.

“We felt that the best thing would be to buy directly from the manufacturer in the case of fertiliser while we procured seeds locally. We then selected suppliers who had always provided services and they delivered. Because of that decision, a bag of fertiliser was bought for M149 which is a first for Basotho, since the price they had become familiar with is M384, the margin of which is M235.”

Mr. Tau  said not all the fertilizer had been sold or used. The remainder was being kept at the main depot at Ha-Foso “under heavy guard by the army, waiting to be used for the winter or summer cropping seasons”.

On allegations that the fertiliser from Kynoch was  of a lower quality than originally  anticipated, Mr Tau said he wasn’t aware of that. Mr Mofosi was better placed to respond.

“I am not aware of that. In any case, such questions are better put to the minister of agriculture,” Mr. Tau said.

Efforts to get Mr Mofosi to comment on the issue have hit a brick wall as he never avails himself to answer questions. Even last night his phone was either unavailable or was not picked up when it rang.