FANRPAN Annual High Level Regional Food Security Policy Dialogue 2010

Reviewing Zambia's input subsidy programme

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1 September 2010
Brenda Zulu
Inter Press Service (IPS) Africa Terraviva

WINDHOEK – Zambian farmers have remained dependent on government for seed and fertiliser despite a seven-year Fertiliser Support Programme (FSP) aimed at supporting the agricultural sector. Researchers are now proposing a review of distribution mechanisms.

However, the Zambian government believes the FSP has had a positive impact on food security in the southern African country.

“With the exception of this year’s harvest, where Zambian farmers had a bumper harvest, the Zambian government involvement of the private sector has been minimal in the FSP,” said Hyde Haantuba, Coordinator of the Agriculture Consultative Forum (ACF) – a Food Agricultural Natural Resource Policy Analysis Network (FANRPAN) Zambia node.

Haantuba reviewed reforms for the FSP and found that the current system was encouraging corruption as only the same private companies were contracted to supply fertilisers and seed in the past years.

He said the ACF was advocating for a voucher programme to replace the current FSP in Zambia in order to improve its effectiveness and efficiency. Such a change would impact on the timeliness and cost-effectiveness of inputs procurement and distribution, FSP impact on food security and farm incomes and produce better value for money.

The study team proposes a change in the mode of inputs procurement and distribution from the current system to a Voucher Based Inputs Supply System, as this would enable the FSP to empower beneficiary farmers with the requisite purchasing power in the form of a discount voucher to purchase inputs of their choice at the nearest outlet – resulting in timely distribution of inputs.

The voucher system would also help minimize the administrative burden and costs, thereby reducing direct government involvement in procurement, importation and in-country distribution. It would also stimulate market competitiveness and in turn encourage the development of a private sector-led agro dealer input supply networks in agricultural areas; and encourage private sector participation in agricultural inputs importation, manufacturing and in-country distribution, amongst other attendant benefits of a well functioning voucher based inputs distribution system.

Haantuba said that system of direct purchase of fertiliser by government for distribution was not good. The has advised the Zambian government to change to the voucher programme that is practiced in other countries such as Malawi.

He said the direct purchase of fertiliser had created a government dependency on fertiliser by farmers and observed that the government was not supposed to be in the business of buying and distribution of fertilisers.

Asked if Zambia would implement the recommendations from the ACF of replacing the FSP with a voucher system, Albert Mulonga, Deputy Minister of Livestock and Fisheries, said that the system was still being reviewed to see if it would be viable.

“The principle of the government is to increase food security at household and national levels. For us the FSP is working as there is improved food security which is our main output in the programme,” said Mulonga.

Mulonga added that the Zambian government has been targeting the poor under the FSP and that it has been transparent in the provision of tenders to the private sector companies that are involved in the supply of fertiliser, seed and also provision of transport in the FSP.

During the first seven years of the FSP’s implementation in Zambia, the programme has improved small scale farmers access to agricultural inputs such as fertiliser and improved seeds. Since inception, FSP has managed to distribute a total of 422,000 metric tonnes of fertiliser valued at 27.6 million U.S. dollars covering a total of 1. 5 million hectares of maize grown by small-scale farmers.

Annually, the programme supplied an average of 60,000 metric tonnes of fertiliser covering about 150,000 small-scale farmers countrywide.

Positive results notwithstanding, there have been a number of concerns about the FSP’s performance, especially with regards to its targeting of beneficiaries; impact on household and national food security effect on private sector investment and participation in agricultural inputs supply markets; and the programme’s long-term sustainability, given the ever increasing competition for national resources by various sectors.

Zambian farmer Cecilia Makota said beneficiaries of the FSP were poorly targeted – noting that she saw stone crushers receiving this fertiliser.

“What do you expect a hungry household to do if they receive two to four bags of fertiliser? Most of it has been sold immediately after being received,” said Makota.

She contended that instead of having spurred growth in agricultural production, the FSP had a limited programme impact on food security.

Wilfred Lipita, Director of Health and Livestock Development in Malawi, said the voucher system which has been running in the country for over five years, needed security features similar to those used in international passports because unscrupulous people could also print these coupons.

“To minimise on this, we do not tell people where the vouchers are made and when they are ready they are under very strict control until they reach the beneficiary,” said Lipita.

He said Malawi uses the Voucher Based Inputs Supply System which has helped in identification and traceability of the farmer through their voucher numbers.