Thursday, May 6, 2010
The fight on Corruption in Uganda will make sense if the proven corrupt pay back the loot
Museveni orders Chogm arrests
By Tabu Butagira
Posted Wednesday, May 5 2010 at 00:00
Ministers and other government officials implicated in corruption during the 2007 Commonwealth Heads of Government Meeting should be arrested, prosecuted and face other disciplinary action, President Museveni has said.
President Museveni, citing threats by donors to slash aid, on March 11 directed Prime Minister Apolo Nsibambi to action against all thieving government employees and private service providers that the Auditor General, Mr John Muwanga, named to have fiddled with Chogm resources.
In the audit report, which forms the bedrock for the winding investigations by Parliament’s Public Accounts Committee (PAC), ministers and permanent secretaries are accused of inflating bills to enrich themselves, bypassing procurement rules and forcing through bad contracts. In the letter copied to the Ombudsman and the Director of Public Prosecution, among others, President Museveni wondered why no action had been taken against those culpable yet the country is on the edge of losing support from nervy development partners.
“Whereas it is true that we made a number of policy decisions to expedite the preparations for Chogm, there was no reason why government officials should not have followed laid down procedures in implementing the decisions,” the letter reads in part.
The President has now ordered that contracts of accounting officers associated with the Chogm mess should not be renewed and efforts be made to fully recover finances disbursed to hotel owners or other private individuals who offered unsatisfactory services.
“(The) government’s lack of action on the (Auditor General’s) report is being perceived as if we are accomplices to the misdeed... I am, therefore, instructing you to cause disciplinary and any other action against officials who were found not to have followed financial and procurement rules and regulations as provided for in the Public Service Standing Orders as well as public financial management and procurement laws,” Mr Museveni wrote.
Prime Minister Nsibambi was not available for comment yesterday but DPP Richard Butera told this newspaper last night that his office is already secretly investigating “a number of cases” forwarded by PAC.
“Yes, we are making some progress but I can’t discuss the details until we finalise the ongoing investigations,” he said.
Mr Raphael Baku, the acting inspector general of government, said his officers are itching to prosecute the Chogm suspects once the Ministry of Finance avails their details.
He said: “The Ministry of Finance had given all accounting officers up to end of April 2010 to submit accountabilities for Chogm expenditures and once we get their report and outstanding areas, we shall take over from there.”
The ombudsman said they are also awaiting the PAC report to avoid duplication and waste of resources. All individuals and bureaucrats, including President Museveni and his vice vice Prof. Gilbert Bukenya, interviewed by the MP Nandala Mafabi-led Pac team have denied any wrong doing in organising the Shs500 billion summit graced by Queen Elizabeth of England.
In the aftermath of tough questioning in Parliament, various technocrats pointed accusing fingers at their political supervisors alleged to have used their executive clout to force down bad deals.
Donors may cut aid to Uganda in corruption protest: Source: http://af.reuters.com/article/topNews/idAFJOE6230KQ20100304
By Elias Biryabarema
KAMPALA (Reuters) - Donors will suspend aid to Uganda to protest at escalating corruption unless the government undertakes urgent measures to curb the vice, the donors warned Kampala in a letter.
Uganda's economy has maintained a powerful growth momentum over the last decade, riding on liberal reforms and rising entrepreneurial energy.
However, mounting corruption and government's reluctance to combat it have stoked fierce criticism and analysts have warned the vice may dampen the country's otherwise bright growth prospects.
Kundhavi Kadiresan, World Bank's representative in Uganda and current chair of the donors' group that presented the statement to the government, said Kampala's tolerance of corrupt public officers was deepening a culture of impunity.
"The undeniable lack of government action to follow up on cases of grand corruption is a key area of development partner concern," she said in the letter seen by Reuters on Thursday.
"Donors ... are currently considering a range of actions. This may include withholding disbursements, reductions in aid or reprogramming away from direct budget support."
The east African country has also faced intense pressure from Western governments and human rights groups over a draft anti-gay law that would prohibit sexual relations between people of the same sex as well as the recognition of homosexual relations as an acceptable lifestyle.
Although economic expansion has enormously boosted Uganda's domestic revenue base and allowed the country to accelerate reduction of donor-dependence, aid still accounts for about 30 percent of its annual budgetary resources.
Closure of aid taps would imperil delivery of key public investments in crucial sectors like health and education.
"Corruption in Uganda is endemic and we have seen no sign of improvement," Kadiresan said.
She cited recent cases of embezzled funds totaling about $33.2 million without anyone getting prosecuted. A state-run body that regulates public procurement estimates that Uganda loses $100 million annually in procurement-related graft.
There was no immediate comment from the government.
Kadiresan said donors were skeptical of government's claim that it would spend oil dollars effectively and suggested proceeds were likely to disappear in an environment where corruption already reigns supreme.
"Only effective and accountable states are able to turn oil into a blessing for a country ... Uganda could easily become the next African country where oil has become a curse," she said.
The country discovered large deposits of oil in Lake Albert basin in 2006 and exploration firms have estimated reserves at 2 billion barrels.
The World Bank estimates Uganda will be earning $2 billion from a daily crude output of about 150,000 barrels. Tullow Oil one the exploration firms in Uganda, has said initial production will start later this year.
our Guide to Corruption in Uganda
>> Saturday, October 27, 2007
KAMPALA (Monitor Newspaper) September 27, 2007
CORRUPTION in Ugandan has escalated and is stifling the nation's struggle to eradicate poverty, according to a report released yesterday by Transparency International, the Berlin-based global anti corruption body.
The country's ranking in the world Corruption Perception Index, CPI, has taken a fresh, disconcerting plunge, dropping 12 positions within one year. With a CPI of 2.8, Uganda is the 117th most corrupt nation in 2007 in a ranking of 178 countries.
Notably, the sharp decline in accountability appears to mock efforts both of the government and its donors who have devoted ever-increasing amounts of scarce resources purportedly to fight corruption in public offices.
The finance minister, Dr Ezra Suruma announced during his 2007/08 budget speech that the US government had granted Uganda $10.2 million (more than Shs18 billion) to strengthen "investigation, documentation and prosecution of corruption cases."
New Zealand and Denmark occupied the first and second places on the CPI, both scoring 9.4 while Somalia and Myanmar tailed the list as the worst and second worst corrupt nations in the world.
Govt pays ghosts Shs21b per year
Kampala (Monitor) October 18, 2007
DEAD, retired, and sacked civil servants are on average paid Shs1.7 billion a month or approximately Shs20.8 billion a year, according to findings by the Auditor General.
The latest AG's report for the year ended June 30, 2006, indicates that the ghosts on the payroll were maintained and managed by a racket of corrupt but organised government officials.
The report says the payments have been handed out for many years. However, an audit sample of salary payments for July 2005 and March 2006 --for ministries/departments, local governments/ referral hospitals and educational institutions--showed that on average a whopping Shs1.7 billion was paid out to ghosts.
In August 2005, President Museveni directed all accounting officers to clean and remove invalid records (ghosts) from the government payroll. Following this directive, an inter-ministerial task force comprising Ministry of Public Service and the Ministry of Education and Finance conducted a payroll cleaning exercise.
Among the key findings, the AG says, was the existence of invalid records or ghosts on the payroll.
"A total of 9,199 invalid records were deleted from the payroll leading to a saving [loss to government] of Shs1.734, 170,984 in salary costs," the report reads in part.
A computation sample for one month shows that at least over Shs1.7 billion is paid to ghost government workers per month. But MPs are saying this has been going on for long and that attempts to expose culprits have either been too sluggish or pending.
The shocking revelations were made yesterday during a meeting between the Parliamentary Public Accounts Committee and officials from the Ministry of Public Service, who manage the government payroll. Budadiri West MP Nandala Mafabi, told Daily Monitor that the Shs20.8 billion could have been used to pay pension arrears for over 1,000 former government employees.
"It's a shame that ghosts are being paid yet we have over 40,000 people struggling to get their pensions. Many of our senior citizens have died without getting their money," Mr Nandala said.
According to MPs, for the five years the ghosts have so far received Shs100 billion. Statistics from the report show that the 26473 invalid records (ghosts) comprised of delayed transfers (65.25%), retired (10.26), absconded (10.03%), died (4.62%), resigned (1.37%), left (0.37%) and others (7.69).
Aswa MP Reagan Okumu accuses officials in the Ministry of Finance and Public Service of 'connivance' to defraud the government. "We are disappointed; How can Shs1.7 billion vanish per month? In fact, officials in Finance and Public service should be investigated. Our people are suffering and these officials are just enjoying themselves," Mr Okumu said.
In the report, the AG found out that of 229,901 records verified, 26,473 were invalid (ghosts), 78 percent of which were from educational institutions, 20 percent from local governments and referral hospitals, and 2 percent from ministries and other government departments.
The committee's vice chairperson, Mr Ssebuliba Mutumba (Kawempe South), said: "This is fraud and this money must be refunded and all officers involved will be arrested." He said this signified the decay in many government institutions.
In her response, Ms Gorret Sendyona, the assistant commissioner in charge of the payroll in the Ministry of Public Service, said the government has embarked on a rigorous cleaning exercise to overcome the problem.
Mr Jimmy Lwamafa, the PS in the Ministry of Public Service, said some unnamed officials have started returning the money.
Officials steal interest on banked govt money
CHARLES MWANGUHYA M
KAMPALA (Monitor) October 15, 2007
A BIZARRE racket in which officials with access to huge deposits of public money hold the cash in special accounts and reap from it in interest can now be exposed.
The officials transfer the cash to fixed deposit accounts for at least a month and end up reaping millions off it in interest.
Mr Ssebuliba Mutumba, the Vice Chairman of the Parliamentary watchdog - the Public Accounts Committee - told Daily Monitor yesterday that the scheme is a "big and complex syndicate" involving mainly the Ministry of Finance which originates most of the funds, Ministry of Defence which is one of the biggest spenders, Bank of Uganda, which does the bulk cash releases and other project-heavy ministries like the Ministry of Health.
"Even if the money stays for two or three days (on fixed deposit accounts), because it is a huge amount, it is still able to make for them millions in interest. It is a complicated syndicate, in fact and the Auditor General only captures just a few," said Mr Mutumba, who is also MP Kawempe South. These government workers with access to the large sums of money, especially those managing project funds, are thus able to make the millions by colluding with top banks in town to hold the money as fixed deposits. The interest that accrues is later pocketed.
The discovery could go a long way in explaining the magic that modestly paid government workers use to be able to live splendid lives, send their children to schools where their monthly salary cannot cover a term's school fees and build plush mansions without the risk of facing court bailiffs over loans.
Top commercial banks in the city are key in the scheme. The money, according to documents available to Daily Monitor, is normally held for anything between one month, three to six months;- during which period it accumulates millions in interest. Now, Parliament watchdog committees are gunning for the heads of those behind the scam and are launching a full investigation. The Local Government Accounts Committee, the Public Accounts Committee and the Parliamentary Committee on Statutory Bodies, State Enterprises and Commissions, are teaming up with the Auditor General to demand that the interest is deposited in the government's coffers.
"We are getting very close to them," Mr Mutumba said. "We shall get their (financial) statements, bank reconciliation and we shall track the money." The interest is usually switched to a separate account to make more money or is pocketed, Daily Monitor has learnt. Meanwhile, the principal sum could either be withdrawn-depending on how much pressure a particular government official could be under to pay off the bonafide beneficiaries or in the absence of such pressure, the fixed deposit period may be renewed.
Because the government does not demand accountability on funds beyond what it disbursed, officials can safely make and keep the difference for themselves.
In one case discovered by the Auditor General, a key government body deposited Shs1.446 billion and at the expiry of the fixed deposit, the project manager wrote to the bank; "the above mentioned fixed deposit matures today 28th June 2001.
We have received your offer to renew the same on 30 days term deposit at an interest rate of 4 per cent and decide to instruct you as follows; 1) Convert Uganda Shillings 867, 500, 000 to US$500, 000 at agreed exchange rate of Uganda Shillings 1,735 and credit that amount into our dollar account. Renew the balance of Uganda Shillings 578, 589, 033 on the fixed deposit account for 30 days at an interest rate of four per cent per annum."
According to audit queries by the Auditor General, in many incidents, only part of the project money is credited to official accounts while larger balances are kept on different accounts which are not official, an indication, officials noted, that some government staff are colluding with either banks or staff members to divert project funds.
Although Daily Monitor's investigations concentrated on bigger project monies, the chairman of the Local Government's Accounts Committee, MP Geoffrey Ekanya, said the problem is bigger.
"It has been going on for the last many years. In fact, it used to be worse under the old system because cheques used to be delayed in Kampala (where they were invested on fixed deposit accounts) and when they are released to the districts, the districts also deposit them on a general account where it of course makes interest," he said, adding that "this interest is never declared."
Mr Ekanya said some affected areas included civil servant's salaries and cited the example of teachers who have often faced the brunt of delayed wage payments. "It is criminal because people who are supposed to be paid suffer and it also leads to creation of domestic arrears," he said.
Sharing the bounty
Because the money is big and has to follow a given trail, which requires many along the ladder to know about it, a well worked-out sharing plan is also in place.
In some projects or ministries, the accruing interest may be given to staff through internal salary loan schemes, Mr Mutumba said, adding: "There is a tendency to lend it internally. It is a very a big game. It is a big, big cancer because at the end of day, projects suffer."
Corruption in Uganda - Source: http://www.hartford-hwp.com/archives/36/420.html
From the UDC Newsletter, Vol. 5, no. 1, pp. 1-4, January, 1995
The following article was recently published in the January 1995 UDC Newsletter, Vol. 5, No.1 (p.1-4):
Within 9 years of NRM's reign, public corporations which are the backbone of Uganda's monetary economy, have been bankrupted by Museveni's appointees. Thank goodness, the majority of Ugandans depend upon a semi-subsistence economy. Museveni's tribesmen stampeded into fat positions to eat the living life out of the economy under the banner of "Twarire" (we have eaten).
Most revealing of NRM's corruption is the bankruptcy of the Country's largest and government-owned Uganda Commercial Bank LTD (UCB). UCB controls over 80% of the commercial banking market.
NRM"s ruling clique gave themselves fraudulent loans worth over 62 billion shillings which they have classified as "delinquent loans". That amount was confirmed by the Central Bank Governor, Charles Kikonyogo. Later, a UCB official admitted that all the bad loans were made during the 9 years of Yoweri K. Nyandwi (Museveni) reign by and to his surrogates.
Nyandwi's (Museveni) sectarianism, corruption and outright thievery is the saga of Uganda's economic mismanagement and decay. First, appointments to high political and corporate positions are mostly based on tribal origin. Second, fraudulent loans were granted exclusively to Tutsis and Himas in order to boost their economic dominance over others. Briefcase and paper companies were concocted and flooded Kampala through which millions were borrowed on the basis of a person's ethnicity and signature. The bankruptcy of UCB has very serious adverse repercussions for Uganda's economy.
The Monitor newspaper of Oct.26-28, 94, reported that "the names behind UCB's bad debts include some of the most famous and prominent politicians, soldiers, bankers and businessmen ". The paper goes on to reveal that mifitary officers collectively owe the bank at least Shs.281.25 million. That includes many RPF commanders. Some of the soldiers who ate the money are diseased.
Here is a partial list of Nyandwi's (Museveni) closest military and political allies who have milked Uganda's economy to death:
The late General Fred Rwigyema Shs. 20.28 million
General Paul Kagame 24.49
Major General Elly Tumwine 52.36
Lt. Col. Sande Mukuru 16.60
The late Maj. Moses Aruho 21.50
Lt. Col. Kasirye Gwanga 27.90
Lt. Col. Jack Tushabe 29.43
Major Benon Biraro 17.27
Lt- Col. Ahmed Kashilingi 19.60
Lt. Col. Mulindwa 41.70
Col. Issa Habib Galugbe 25.18
Major Francis Achoka 10.03
NRM politicians are big holders of bad debts from UCB. This could be the reason why they are anxious to write off the debts. Among UCB swindlers are:
Hon. Minister Dr. Reich Adriko Shs.130 million
Hon. Minister Matthew Rukikaire 39.98
Mrs. Sheba Rukikaire (ministers wife) 42.80
Hon. Minister Sam Njuba 26.99
Mrs. Getrude Njuba (minister's wife) 33.96
Hon. Minister Betty Okwir 69.46
Solicitor General, Pierre Kabatsi 17.20
Secretary to the Treasury,
Tumusiime Mutebere (interest free loan) 11.65
Hon. Minister Stephen Kavuma 26.80
Hon. Joyce Mpanga 58.50
Hon. Major Amin Onzi 36.20
Hon. Obiga Kania 16.60
Hon. J. Zimula Mugwanya 53.32
Hon. Dr. William Kaberuka 30.84
Hon. Okodi Levi 17.20
Hon. Sam Kuteesa 26.93
" " " " (under Uganda Motors) 848.00
Hon. Israel Kayonde 233.68
Hon. David Kibirango 10.10
Hon. Omara Atubo 19.70
Hon. William Wanendeya 38.94
The late Minister Kafumbe-Mukasa 31.86
The late Yafesi Sabiti 79.30
Hon. Tom Apila 10.13
Hon. Yona Kanyomozi 3.00
NRM's business insiders who are major pushers of corruption are also among prominent bank swindlers. The list of these operatives is very long. Unfortunately, theft true identities are hidden in company names. Only two names were unveiled, and those are:
Mr. Haruna Ssemakula of General Parts Co. 2.98 billion
Archbishop Makumbi of Evangelical Church 19.74 million
UCB's top managers alone owe the bank a total of 3 billion
shillings. Among those are:
Frank Mwine (former Managing Director) 361.79 million
W.N. Nabudere 174.6
E. Nkwanga 172.61
B.R. Kizza 37.9
F. Byamugisha 11.63
UCB lost an additional $12 million in a rural credit scheme, according to Africa Analysis. Under that scheme, signature loans were made to Tutsis and Himas for the purpose of buying up land mostly in Buganda and dislodge the powerful Baganda from their ancestral land. If this sinister plan succeeds, Buganda will be populated and controlled by Tutsis, thus scattering Baganda into obliteration. That scheme which is part of the Tutsi master plan of colonizing East Africa, has a title of "Ranch Restructuring and Anti-Nomadism". It recently surfaced under the Ministry of Agriculture with a nyarwanda Deputy Minister (John Nasasira).
Africa Analysis of Sept. 94, reports that "American organizations have virtually taken control of Uganda's commercial banks in order to save them from collapse. The bail-out is spearheaded by U.S.A.I.D. and I.T.T." The paper also reports that other American companies are expected to participate in a proposed restructuring of the country's central bank (The Bank of Uganda).
American officials know that the collapse of Uganda's banks is caused by corrupt self-imposed rulers. They also know that the people of Uganda are consistently demanding democratic governance. Instead, the entire cabal (USA, UK, World Bank/IMF and Nordic countries) opted for undermining their own countries' commitment to the promotion of democracy and sneered at Ugandans' struggle for a democratic, responsible government freely elected by the people. It is clear that America's financial bail-out of Nyandwi's (Museveni) corrupt, self-imposed and illegal regime is immoral, inhumane, despicable and sacrilegious.
Recall in the 1950s when FIRESTONE CO. virtually owned Liberia and the exploitation it unleashed. Tax and Customs collection were run by Firestone and the population was reduced to mere serfs, peons and squatters. The U.S. State Dept. was not ignorant of the ongoing Firestone exploitation of Liberia. In the case of Uganda, ITT is playing similar tricks which will obviously antagonize Ugandan-American cordial relations. What is happening in Algeria today, could easily be replayed in Uganda.
A foreign company's major objective, be it, I.T.T, Firestone or British East African Co. is to make profits for its owners. It is a fallacy to claim that profit-seeking companies are coming to "help". Kampala International Hotel was built with Uganda's money and owned by Uganda. During that time, many nationals enjoyed its facilities. It is now owned by I.T.T. under a new name of "Kampala Sheraton Hotel", enjoyed by foreign bank-rollers of Museveni's regime and members of the Tutsi junta. ITT's encroachment into Uganda's banking system has empowered it to suggest that it will revise UCB's charter. The question is, to suit whom? Foreign companies have a tendency of maximizing piracy whenever given a chance to influence the drafting of laws which could establish the modus operandi of their own businesses in a foreign land. A classic example of that exploitation was in Libya when foreign oil companies had the liberty of drafting the laws that were to govern the newly discovered oil industry. Their shameless braggadocio of claiming to have given Libya her "oil industry laws" had an influence on the subsequent Libyan revolution.