Ghost payments could bleed wool farmers



. . . as spotlight moves to shambolic financial records


MASERU – Glaring disparities in the financial records of wool and mohair farmers could result in the government paying some ghost farmers while other deserving ones may not get paid at all.

This has emerged after shocking figures of a mismatch in financial records between the Lesotho Wool Centre (LWC), banks, as well as shearing centres were revealed on Monday this week.

Some farmers have been overpaid, others have been underpaid while another group appears to have been paid based on LWC records when they have in fact not received their payments.

Cabinet has made it clear that the budgets for the two ministries; Small Business Development, Cooperatives and Marketing, and that of Agriculture and Food Security, will not be approved unless the wool and mohair issues are dealt with.

The financial statements produced by LWC are different and in conflict with those from the local shearing centres. The figures are confusing and have for a long time resulted in the delay in payment of farmers who have been living in poverty since 2018.

Reports show that some of them have even died without receiving any payment. In the 2018 financial year, parliament approved the Agricultural Marketing (Wool and Mohair) regulations of 2018.

These prohibited farmers from selling their wool and mohair outside of the country, forcing them to take their fibre to the Thaba-Bosiu-based wool centre in a move meant to localise the multi-million Maloti industry.

However, the regulations were largely rejected by farmers, who argued the centre which is owned by the controversial Chinese businessman, Stone Shi, was struggling to deliver.

The government tried but failed to find a solution that would see farmers embracing a new way of doing things.

The regulations were later amended in 2019 allowing farmers to trade from anywhere they want and the government has since suspended LWC’s operating license. To date, scores of wool and mohair farmers are yet to receive any payment from the centre for fibre delivered way back in 2018.

The government has decided to intervene and initiate the process of paying farmers from its own coffers.

How the money will be recovered remains to be seen. “Government is going to pay farmers and we will deal with Lesotho Wool Centre thereafter on how to recover the monies,” the agriculture minister, Tefo Mapesela, said on Monday during a meeting that sought to level the playing field for the payment of farmers.

For an example, in Qacha’s Nek a total of 74 wool farmers from different sheering centres are owed M1.2 million according to records from their representatives. Records further show that 34 other wool farmers are owed more than M115 000, while 96 others were underpaid by M489 000 with three mohair farmers were remaining underpaid by an estimated M4 373.

All these statistics from the district are in contrast with those produced by LWC.

Deputy Prime Minister Mathibeli Mokhothu has emphasised that the farmers will be paid immediately after the reconciliation process.

“This is an important issue because it is going to assist us towards being in a position to pay the farmers. We have been working around this issue for a long time now and no progress has been made, but now after this meeting we

will be able to make an impact.

“Initially government set aside M8 million to try and put this matter into finality but the fact that figures are in conflict has made it difficult for us. But we believe that after the meeting, a solution will be reached,” Mokhothu added.

Wool and mohair forms the bedrock of Lesotho’s economy, with producers ranging from small-holder farmers with micro-flocks, to breeders of superior gene-quality animals who manage larger numbers.

According to the Lesotho Mohair Primary Production Research Report of 2019, the industry has grown, with the country having an estimated peak of 845 000 goats in 2001, with the average goat yielding approximately 0.97 kilograms of mohair.

Between 1990 and 2009, Lesotho’s primary production increased by 25 percent as compared to other leading fibre-producing countries such as the United States, which declined by 93.2 percent and South Africa, which declined by 74.3 percent in the same period.

This while the market-share in the primary production of mohair increased from 7.3 percent in 2000 to 14.3 percent in 2009, entrenching Lesotho as the second largest producer of mohair in the world.

The figures demonstrate that the primary production sub-sector of the value chain has grown rapidly year-on-year, contributing to the overall growth of the national economy.

In the financial year 2012/2013, the country is believed to have exported more than M3 million kilograms of wool and mohair valued at about M209 million.


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