Prosper Ndlovu, Business Editor
GOVERNMENT has started rolling out its subsidy programme to all licensed grain millers and has made advance payment for this month as it moves to stabilise mealie-meal prices.
President Mnangagwa had to intervene to reverse an earlier decision to remove subsidy on grain, which had prompted the milling industry to increase the prices of mealie- meal beyond the reach of many.
The 10 kg bag of roller meal was increased from between $50 and $60 to $100 or more following the removal of the subsidy thereby sparking widespread consumer outcry. Isitshwala/sadza is the country’s staple food.
To kick-start the maize roller meal subsidy programme, Treasury has committed to paying the subsidy for December 2019 in advance. Thereafter, monthly subsidy payments would be paid post verification of monthly production of roller meal, the Ministry of Finance and Economic Development said in a statement yesterday.
These operational modalities of the roller meal subsidy programme, it further noted, will be constantly reviewed in consultation with all relevant stakeholders to ensure transparency, accountability, efficiency and effectiveness.
“Further to our recent communication on the introduction of subsidised roller meal, Government is now rolling out the subsidy to all licensed maize millers, who are formally registered in terms of tax purposes, have Government Vendor Numbers and have been accessing grain for milling purposes through Grain Marketing Board,” said Treasury.
“Grain millers will buy maize from the GMB at a price of ZWL$4 000 per tonne as announced by Government on 5 December 2019. All licensed millers including non- GMAZ members will be allowed to participate in the roller meal subsidy programme, given that not all grain millers are members of GMAZ.”
With the commencement of the subsidy programme, mealie meal price is expected to drop to about $50 for a 10kg of roller meal. The millers have also committed to reversing the price in response.
According to Treasury, participation in the programme would require milling players to register with the Ministry of Industry and Commerce.
Grain millers are also required to provide details of their roller meal production capacity for verification, including schedules of grain purchases from GMB in 2019.
“Before approaching the Ministry of Industry and Commerce for registration, grain millers should first obtain written confirmation of their maize allocation from GMB,” reads the statement.
“Payment for the subsidy by Treasury will be based on verified production of roller meal by the millers, based on the maize allocated by GMB.”
Treasury has said that verification of production will be done by a team of officials from ministries of Finance, Industry and Commerce as well as the Zimbabwe Revenue Authority. It directed that claims of the subsidy by millers be submitted to the Ministry of Industry and Commerce.
“Subsidy payments will be made from the budget through the Ministry of Industry and Commerce directly to the individual millers bank accounts. In this regard participating millers should provide their banking details upon registration,” said Treasury.
In line with demand, Treasury explained that a total of 40 000 tonnes of maize is required to produce 32 000 tonnes of roller meal per month. This implies an extraction rate of 80 percent, which should be applied for the calculation of the subsidy to each miller.
“In this regard GMB will avail this monthly maize tonnage. Millers are also free to import maize given the recent liberalisation of the importation of maize. The offtake of maize by grain millers from GMB will be based on market share of each miller,” it said.
“All claims for the subsidy should be backed by relevant documentation from the GMB for maize purchases or a bill of entry for grain imports. Documentation relating to the production and sale of roller meal by each miller should also be submitted with the claim for the subsidy.”
The monthly amount of subsidy to be paid directly to the individual millers’ bank accounts will be based on verified production of roller meal.