BDF warned over misusing public funds, Leader fails to explain why
Rwanda: The parliamentary Public Accounts Committee (PAC) has warned senior executives of Rwanda’s Business Development Fund (BDF) for failing to fulfil their responsibilities for the development of small and Medium businesses in Rwanda, TOPAFRICANEWS has learnt.
In addition to the failure to properly manage public funds that were responsible for investing in small-scale projects, the PAC alleges that the BDF failed to recover the large sums of money that had been pledged as collateral for loans to one of the funded projects.
On September 17, 2020, when BDF senior officials appeared before PAC to explain why they had failed to use the funds to support micro-enterprises, the PAC stopped hearing the officials because they were unable to respond to the questions and apparently PAC had not time to make comment on the contents of the BDF report simply because it was considered lacking.
PAC pointed out that the BDF, as a small and medium-sized enterprise development agency, has shifted its responsibilities from helping Rwandan projects to foreign ones, according to the Auditor General’s report last year 2018/2019.
PAC Chairman Valens Muhakwa told BDF leader that Rwandan entrepreneurs should be given priority and support for their projects, wondering how the person in charge could not see the problem.
“How do you know that the projects of our poor people are the ones that should be helped first and foremost, and that is what you are paid for, you mean we are the ones who are confusing your responsibilities”? Muhakwa asked BDF leader
The response also surprised members of the PAC Commission, who wondered what was behind the BDF leaders’ response, wondering why the BDF did not have the heart to think of supporting Rwandans, but to allocate funds to the Americans that had brought their investment.
The report of the Auditor General also shows that the BDF has not been able to provide loans to the needy as it was in its mandate, given that from 2011 to 2019 it only paid Rwf 25.1 billion, while it was supposed to have provided Rwf 49.2 billion, which was also given to large projects instead of small and medium enterprises as planned.
The Auditor General says the move has slowed BDF beneficiaries in small and medium enterprises.
“This has prevented the development of small business owners, because instead of being mortgaged to get a loan, it is given to others as opposed to why the fund was set up,” he says.
The PAC analysis shows that the BDF has suffered losses due to deviations from its bail obligations in violation of the law. For example, for projects that have been secured without prior evaluation, all of this is due to the administration failing to fulfil its responsibilities.
An example is the fact that BDF has pledged more than 800frw, for 11 projects without considering its preparation, such as whether their activities have a market, assessing the company’s assets, and infrastructure including electricity so that operations can be run smoothly.
For this reason, the Director of PAC Muhakwa has asked the BDF Director to reconsider, to see how he implements his responsibilities in the governing body, if indeed this action is in line with the mandate given to him.
