
GOVERNMENT has announced changes to the Farmer Input Support Programme (FISP) as well as the role that the Food Reserve Agency (FRA) will now play during the 2013/2014 crop marketing season following the removal of subsidies.
Minister of Agriculture and Livestock Robert Sichinga said the FISP, provides production subsidies mostly for maize grain to about 900,000 small-scale farmers.
At a press briefing in Lusaka yesterday, the Minister said Government funding to FRA was not adequate and not readily available resulting in delayed payments to farmers in the past years creating budget overruns.
“The implication of the removal of the subsidy is that the price of our staple food commodity – mealie meal, will inevitably have to rise,” Mr Sichinga said.
Mr Sichinga said the FRA would purchase maize in accordance with the act but would restrict its participation in the market to secure strategic grain reserves and any excess that would remain after private sector participation.
“The government, decided for the 2011/12 season, to maintain the farmer contribution at KR50 per 50kg bag. This is despite the fact that the cost of managing the programme had risen significantly,” he said.
He said during 2012 the total cost of the production for subsidy was estimated at KR1,181.2 million adding that there was an outstanding debt of about KR280 million, arising from unpaid expenses.
He said if the current subsidy was maintained the FRA would continue to be recording losses and continue to depend on government for funding, to support such subsidies.
Mr Sichinga said the Authority was currently carrying a debt estimated at about KR2.2 billion, carried over from 2011 and 2012 maize marketing season.
“One of the goals of the Government is to encourage farmers to diversify and promote the growing of other high value crops and calls for the promotion of tailor-made subsidies, towards small-scale farmers and the promotion of a much wider range of crops,” he said.
He said Government was likely to enact legislation that would govern the marketing of agricultural commodities in Zambia and expected to result in the eventual reform of the operations of the FRA.
“Private sector participation in marketing, encouraging the private sector to play a greater role in maize marketing would have the positive impact of reducing the financial burden on the treasury and ensure millers have more control over their own stock,” Mr Sichinga said.