AGRICULTURE CS Peter Munya suspends Sh100 maize flour subsidy programme citing inadequate funds from Treasury.
The government, in an agreement with millers, had in July agreed that the subsidy programme was to end after a month. This is despite President Uhuru Kenyatta’s announcement that the programme would continue indefinitely.
The subsidy programme was started to ease the price of flour that had shot to a historic high of Sh210 on the back of a shortage of maize. The prices have so far dropped to Sh100 but the flour is hardly found in shops.
“The programme was to run for a month from the contract that we had with the government. It is coming to an end next week,” said Rajan Shah, chief executive of Capwell Industries.
Naivas supermarket chief commercial officer Willy Kimani said supplies have improved but they sell out as soon as they are stocked.
“Out of 100 per cent of the orders that we make, we have been getting at least 65 percent. However, this flour is immediately cleared by customers who go and resell it out there because of a shortage that exists in the market,” said Mr Kimani.
Millers are also grappling with slow payment from the government even as it emerged that only Sh4 billion had been set aside for subsidy despite the Ministry of Agriculture’s announcement that Sh8 billion had been allocated for the programme.
A miller who spoke to us said he had only been paid half of the consignment that he had released to the market as of Friday.
“We have not been paid all our dues and so far we have received slightly over half of what we have already supplied,” said the miller.
The government had agreed to pay millers in 24 hours after the flour is delivered to the market.
Millers have warned that Kenyans should brace for a severe shortage in the coming days as they scale down on production over the uncertainty brought about by the coming in power of the new government.