By: Andrew Kathindi
Agriculture minister Calle Schlettwein said allowing Agricultural Business Development (AgriBusDev) to operate the green schemes turned out to be a problem.
Schlettwein’s comments come after the Cabinet approved to cancel the memorandum of understanding between the agriculture ministry and AgriBusDev.
“There is an objective that got lost in this whole scheme: the support scheme for farmers. But these entities ended up burdening farmers.
“The lesson learned here is that one must continuously measure the output of these entities that we’ve created against what the intention and objectives were. As soon as it wanders off, you must not only review but must correct it,” Schlettwein explained.
The AgriBusDev, a Section 21 company, was established on the 3rd of November 2011 in terms of the companies Act, Act 2004.
As a State-owned company, its objective is to monitor and create an ideal environment for achieving the objectives of the Green Scheme as circumscribed by the Green Scheme Policy of 2008.
AgriBusDev was in charge of 11 Green Scheme Projects established by the Government.
The projects were supposed to be operated and managed in terms of specific farming models outlined in the Green Scheme Policy document and executed within the parameters of the Agronomic Industry Act (Act 20 of 1992).
Over the years, however, AgriBusdev could not manage the green schemes and pay workers. As a result, about 5 600 out of 8 950 hectares were under irrigation.
Apart from the failure to produce, AgriBusDev failed to pay workers on time and relied on the agriculture ministry for bailouts.
The Cabinet’s decision affirms what Schlettwein said in June this year regarding the plan to wind down AgriBusDev.
According to Schlettwein, the plan was to dissolve AgriBusdev and transfer the staff to the agriculture ministry.
He also proposed that the green schemes be outsourced to private operators and appointed competent managers.
The green schemes, SChlettwein said, should be aligned to the Harambee Prosperity Plan.
Essentially what Schlettwein proposed in June is what the Cabinet has affirmed.
According to a Cabinet directive dated December 2021, approved the termination of AgriBusDev as an operator of the Green Schemes in the schemes.
The directive also says staff will be transferred to the Directorate of Agriculture Production, Extension and Engineering Services Divisions.
Furthermore, the Cabinet said the green schemes should be outsourced to private operators in line with the Harambee Prosperity Plan II through calls for expression of interest coupled with economically, socially, environmentally and financially feasible plans.
There will be an audit of all green schemes across the country, and all green schemes can now diversify farming activities to include livestock.
The operators are expected to provide business plans for private development in communal and commercial areas.
In addition, the operators are expected to state development in communal and commercial areas.
Small-scale farmers, the directive said, should be given 10 per cent shares operating units at some green schemes.
The private operator will be expected to build the small scale farmers’ capacity to increase their shares in the farming business to reach the maturity of shareholding for them to take over when the lease expires.
“The Cabinet approved that in the case where models for operating Government-owned green scheme projects in alignment with the Cabinet approved Green Scheme policy, each Green Scheme will operate and be managed as a separate business entity,” the directive said.
“It’s a welcomed decision which the ministry requested. Unfortunately, when the decision was taken previously that Agribusdev is the operator, that turned out to be a problem.
They were not well equipped, and the management model was wrong,” the minister told Eagle FM on Tuesday.
He said the directive would be fully implemented in the next six months, considering that green schemes are not all the same.
“We will take it one by one. You must give us time so that we don’t rush into things that have unintended consequences,” Schlettwein said.
The minister said he was glad the decision was taken because none of the green schemes is producing enough to be viable.
“We are hoping that by the next season, the green schemes will be fully productive again. Of course, with the season ahead of us, it will be tough to get them to full production, but we want some production.
“I just wanted to make sure the agricultural activities on green schemes are aligned with agriculture’s policy. With Agribusdev’s operational track record, that was not possible to achieve. That’s why we are separating the two issues. Agriculture must make sure green schemes are working,” the minister said.
The AgriBusDev acting managing director, Berfine Antindi, said she had mixed feelings and that if Cabinet decided, it should be for a good reason.
“Green schemes have been working well before AgriBusDev was there. To be honest, things are falling apart. If that decision is to help us get to where we were before, I’m okay with it.
“It’s not just about having a company called Agribusdev if we are not doing what is expected,” she said.
Antidni further said a lot of things went wrong.
“The company was put there. At one point, I think it was not appropriately equipped in terms of finance so that they could stand alone. The capacity for the staff members for a company to perform better has never been there. The company has been receiving financial injections from the agriculture ministry. They never generated money to be independent.
“They ended up knocking on some doors for loans. It was not proper because agriculture is very risky. You are not sure you’ll make money, yet you’ve taken loans and made commitments,” she said.
Antindi added that green schemes were not supposed to be under a huge company.
“When you look at AgriBusDev, it’s a huge company with over 300 staff members. That’s huge. Financially, they were not there. With the little money they generated, the salary bill is too huge. The company became too ballooned.
“The ideal situation was to have a small structure with good capacity at the project level, supervised by a small unit with a head office in Windhoek,” she added.
Quizzed on whether she saw the public enterprise being completely wound down soon, she said, “I think that is where we are, as things are. But if projects run, you won’t need someone central. The question now is, what do we do with the staff because the people are there.”
She said the ideal situation could be to move some departments within the agriculture ministry.
