“New Dawn” CDF high hopes fail to materialise

April 2, 2023

By Chilombo Ching’anda and Florence Simazuo

The “New Dawn” government’s increase of CDF grants from K25.7 million to K28.3 million was meant to promote decentralisation and spur development at the community level.

Eligible applicants, many of them community NGOs such as cooperatives and clubs could qualify for one-off grants of up to a maximum of K40,000, according to the 2022 Constituency Development Fund (CDF) guidelines.

This is part of the government’s vision to enable Zambians to benefit from CDF, by involving as many organised groups as possible to source funds from the CDF to start or expand their businesses.

But for many cooperatives, things have not worked out as planned. Take the example of the Lusaka-based Mass Media Youth Cooperative in Kalingalinga.

It’s grant of K20,000 was meant to boost its tailoring business but instead, K12,000 of the grant was shared amongst its members.

Amos Mwape, cooperative chairperson, said he was pressured by the members to share the money.

“In the proposal that was submitted to the council, we planned to order an overlocking sawing machine and a straight-sawing machine but some members demanded a share of K2,000 from the grant,” Mwape revealed.

He said the cooperative now has only K8,000 lying in its bank account.

Mass Media is not the only cooperative that applied for the funds and squandered them.

A MakanDay survey reveals that several cooperatives which received grants have also done the same.

For Make it Excellent Multipurpose Cooperative, a mushroom-growing cooperative, only office furniture and an empty yard, which once housed their mushrooms, remains.

This is after the cooperative lost the bulk of its grant in a failed investment. The cooperative invested almost all its grant in another mushroom growing company that later lost its property due to its indebtedness.

‘‘Our cooperative invested close to K10,000 in another mushroom growing company because this other company was already established, so it provided us with an affordable place to grow mushrooms and also conduct training sessions, as we are also involved in training potential mushroom growers,’’ said Watson Hamungala, Make it Excellent Multipurpose Cooperative chairperson.

‘‘Without our knowledge, the company we had partnered with to grow mushrooms had accumulated a lot of debt on the property they rented for their business and this led to their eviction by bailiffs.’’

With no mushroom to grow and no other way to get back the money his cooperative had invested, Hamungala is now taking care of an empty property which once housed his mushrooms.

This is what was once a mashroom building

Chate, a cooperative formed by University of Zambia (UNZA) students, is another CDF grant recipient that has failed to actualise its business proposal.

Langford Mbewe, Chate group representative, said the cooperative had proposed to set up a car wash near Kalingalinga’s Total fueling station, but due to inadequate capital, it opted to grow onions in Chipangali district of Eastern province.

‘‘Setting up the car wash business was supposed to cost K52,500, including buying a pressure machine, tanks and constructing a shelter,” Mbewe told MakanDay.

“So knowing we could not manage the car wash business, I offered my land so that we grow onions to help us raise more money,’’ Mbewe said.

MakanDay was unable to independently verify the existence of the onion farm.

Chikulufye Lishina Multipurpose Society and Quick Runners Multipurpose Society, which initially received CDF grants to rear chickens, but are instead running a money lending business, claim they are making steady progress in their alternative business.

Among the CDF grantee cooperatives surveyed by MakanDay, only Kalingalinga multipurpose society seems to be running a thriving welding and carpentry business.

Kalingalinga ward 31 councillor, Mukubesa Nyoni has blamed the failures on the poor choice of sustainable business proposals by the applicants.

‘‘From my observation, the cooperatives have failed to run successful businesses for which they received the grant becausethey were interested in just getting the money and using it for other thingsother than do business,’’ said Nyoni.

Kalingalinga Ward Development Committee (WDC) Chairperson Richard Munyonshi, said members of some cooperatives are using their perceived political connections to squander the money.

‘‘It has been hard to monitor some cooperatives as they boast of having political connections,” said Munyonshi. “When we ask about the progress of their businesses, they also ask us if it is our money that we should be concerned.”

Munyonshi wants government to strengthen the CDF guidelines to safeguard the funds.

The 2022 CDF guidelines do not provide for penalties for cooperatives that misuse the money.

The government insists, the guidelines are adequate and that the only consequence for misuse of funds is for cooperative being barred from accessing funds from the CDF.

“Grants are grants, so they’re not repayable,” said the ministry of Local Government and Urban Development’s Maambo Hamaunda.

“However, if cooperatives do not use the grant for its intended purpose, and are reckless with the money, government will take note of that cooperative so that it is not available to receive any assistance from government in future engagements.”

Hamaunda warned: “Depending on the severity of the matter, and it is something bordering on criminality, we could even go a step further and institute criminal proceedings.”

The total allocation of the CDF per Constituency is distributed among three major Components, out of which 5% is for administrative cost as provided by the CDF Act. The remaining 95% is allocated as tabulated in table below: