The Observer (Kampala)

11 November 2012

Uganda: Govt Sets Controls to Curb Mass Fraud

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Ministers and other senior government officials meeting in Kampala last week resolved to put in place tighter financial management systems to minimise fraud in government ministries, departments and agencies.

A source that attended the two-day retreat at Imperial Royale hotel in Kampala, on Thursday and Friday, told The Observer that participants decried the manner in which the government has lost billions of taxpayers' and donors' shillings as a result of loopholes in its financial management systems. The country was recently shocked by revelations that colossal sums of government money were stolen in the Office of the Prime Minister (OPM) and the ministry of Public Service's pension department.

In the OPM case, a special audit by the Auditor General unearthed how aid from Ireland, Norway, Sweden, Denmark and Britain, among other donors, was transferred to un-authorized accounts, resulting into the loss of billions of shillings meant for post-war recovery efforts in northern Uganda. In the pension scam, the CID recently burst a racket in which some 1,018 former employees of the East African Community, believed to be ghosts, received Shs 63 billion in pension payments between February and October last year.

In both cases, senior officers, including the ministries' principal accountants, allegedly took advantage of loopholes in the financial management systems and, in the case of OPM, dormant project bank accounts, to misappropriate billions of shillings. The respective permanent secretaries, Pius Bigirimana (OPM) and Jimmy Lwamafa (Public Service), have been faulted for having failed to detect the fraud in time.

Last week's government retreat, which the vice president, Edward Kiwanuka Ssekandi, opened, was organized by the OPM and specifically discussed outcomes and performance of each ministry. Participants included ministers, permanent sectaries from all ministries, district chairpersons, heads of government departments and resident district commissioners from across the country, or their representatives.

"The meeting came up with several measures to fight fraud, and these include expediting clean-up of the government payroll by removing all ghosts, and closing all dormant bank accounts," the source said.

It was also agreed that senior civil servants such as permanent secretaries and principal accountants, should be transferred every two to three years, instead of the current 10 to 15 years as has been the case in some ministries. Participants agreed on tighter controls on aid from development partners, through, among others, closely monitoring electronic financial management systems in various government ministries, departments and agencies.

The retreat is held annually to evaluate government performance.

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