Residents of Aktobe are facing a shortage of socially significant food products despite multi-billion funding of Stabilisation Fund programmes.
According to the audit report of the financial statements of the Social-Entrepreneurial Corporation (SEC) «Aktobe» for 2023, the organisation received more than 20.6 billion tenge for various support programmes, including almost 2.6 billion for the formation of the regional Stabilisation Fund for food goods, while significant shortages of property were identified within the organisation.
SCOPE OF THE PROBLEM
Earlier, the FBRK editorial team reported that residents of Aktobe cannot purchase basic food products: beef, chicken eggs, poultry meat and sunflower oil have been absent from shelves for several months. Sugar, flour and pasta were last available for sale in December.
The paradox of the situation is that the price stabilisation mechanism through the Stabilisation Fund exists, but operates inefficiently. The Stabilisation Fund is a state regulatory instrument created for purchasing food during periods of low prices and subsequently selling it to curb price spikes.
STABILISATION FUND FINANCING
Analysis of the financial statements of SEC «Aktobe» for 2023 shows a significant volume of state funding allocated for food market support programmes:
- SEC «Aktobe» entered into a loan agreement with the Department of Finance and the Department of Entrepreneurship of the Aktobe Region for the amount of 260 million tenge to stabilise prices for socially significant food products.
- The Department of Agriculture of the Aktobe Region allocated 805.4 million tenge for the implementation of the programme «Formation of regional stabilisation funds for food products».
- An agreement was concluded between SEC «Aktobe» and the Department of Agriculture for the implementation of the stabilisation funds programme in the amount of 1.5 billion tenge.
In addition to the funds for the Stabilisation Fund, SEC «Aktobe» received 16 billion tenge for the microcredit programme «Aul Amanaty» and 2 billion tenge for creating new or expanding existing dairy farms.
PROBLEMS IN RESOURCE MANAGEMENT
The audit report of LLP «BR-Audit» revealed serious shortcomings in the internal control system of SEC «Aktobe». Based on the results of an inventory taken in November 2023, shortages of 474 units of fixed assets were found, amounting to 20.7 million tenge.
Although the auditor did not point to specific violations in the use of Stabilisation Fund funds or tranches from the Department of Agriculture, the identified shortcomings in asset accounting and control raise legitimate questions about the effectiveness of state fund management.
STRUCTURAL PROBLEMS
As we have previously noted, SEC «Aktobe» has not paid for supplied products for several months. Moreover, goods supplied through the SEC account for only about 2% of the region's market — too small a share to influence pricing.
The problem is compounded by the lower quality of these goods and complex bureaucratic requirements for suppliers, including the need to provide collateral or a bank guarantee when obtaining a loan.
CONCLUSIONS
It is clear that the situation with the shortage of products in Aktobe, against the backdrop of significant funding for the Stabilisation Fund, requires a review of current mechanisms.
Shortcomings in SEC control, problems with paying suppliers, and the small market share covered by the Stabilisation Fund point to the need to improve the efficiency of using state funds.
To ensure the region's food security, it is likely that not only financial injections are needed, but also improvements to the work of the Stabilisation Fund, simplification of interaction with suppliers, and increased transparency in management.