TREASURY has committed to inject an additional ZW$100 billion towards agriculture as the farming sector receives a lion’s share of the supplementary budget at a time nearly four million citizens are facing food insecurity.
Finance minister Mthuli Ncube has proposed a ZW$1.8 trillion supplementary budget from an initial budget of ZW$968 billion announced last year.
According to the latest Rural Livelihoods Assessment Report, at least 3.8 million people are facing acute food insecurity following a sharp decline in agricultural output despite the government perennially dolling out billions of Zimbabwe dollars into the sector.
Both urban and rural dwellers, according to aid agencies, are food insecure. Treasury has been subsidising agriculture and parcelling out inputs in what critics said was an election gimmick mainly targeting the 61% of the rural population, which is traditionally the governing Zanu PF’s stronghold.
Ncube told Parliament on Thursday that lower-than-expected agricultural output and climate-proofing measures had prompted Treasury to propose granting agriculture more funding. Zimbabwe experienced two successive years of economic contraction from 2019-20 due to climate change-induced droughts and floods.
“With the revised 2022 National Budget, ministries of Lands, Agriculture, Water, Climate and Rural Resettlement and Primary and Secondary Education top the list with an additional ZW$100.7 billion and ZW$103.9 billion,” respectively,” Ncube said.
“On agriculture, the resources are earmarked for grain procurement, preparations for the forthcoming season and dam construction. For the rest of the votes, the additional funding is meant to meet increased operational costs, the wage bill and identified projects and programmes.”
Since taking over large swathes of land from white former commercial farmers, authorities have been frantically rolling out programmes to boost agriculture output which dramatically plunged at the turn of the millennium.
Early this year, the International Monetary Fund (IMF) expressed concern over the limited levels of transparency and accountability on the country’s agriculture import substitution programme, widely known as Command Agriculture, amid growing criticism of the scheme.
“Although the input financing under the Common Agriculture Programme was transferred to the banking system under a risk sharing arrangement, risks to the budget remain as the government provides an 80% credit default guarantee,” the IMF said.
“Limited information, including on costs and beneficiaries, hampers the assessment of the effectiveness of the programmes.”
Zimbabwe, once regarded the bread basket of southern Africa due to good agricultural output and favourable climatic conditions, has over the years experienced a huge slump in the sector’s contribution to the economy after production was disrupted by the controversial land reform programme.
In an attempt to reverse this trend, the government introduced several programmes such as the farm mechanisation scheme and later on Command Agriculture, which saw the government subsidising farming inputs such as seed, agrochemicals and fertilisers. Critics however say the programme is not only a huge burden on taxpayers but also shrouded in secrecy and is also linked to the ruling Zanu PF benefactors. Following a public outcry over the facility, the government partnered with local bank CBZ in rolling out the programme, but critics say more disclosures are needed.
Before that, a damning parliamentary report on Command Agriculture exposed how former Finance minister Patrick Chinamasa and the Reserve Bank of Zimbabwe superintended over a murky and illegal process through dubious approvals of Treasury Bills that have saddled the government with a debt of nearly US$1.6 billion.
According to Parliament’s Public Accounts Committee (PAC) report presented in March following a two-year probe on how funds were used under the Special Maize Programme better known as Command Agriculture, Chinamasa and the central bank disregarded the law in discharging the programme.