The Observer (Kampala)

16 November 2012

Uganda: OPM Scandal - All Ministries Under Probe

The massive financial abuse in the Office of the Prime Minister has forced the cabinet to order a financial audit in all ministries and government departments.

Ethics minister Simon Lokodo told a news conference at the Media Centre yesterday that the directive takes immediate effect.

Fr Lokodo explained that the decision to investigate all government ministries and departments was agreed on in cabinet. The move, he added, is meant to root out corruption.

Lokodo said the Auditor General and all ministries and government departments had been informed.

"If such grand corruption can happen in the OPM, how about other ministries?" he wondered. The Auditor General's office carries out annual financial audits of government departments but this particular exercise seems to be extraordinary.

The special audit comes hot on the heels of two financial scandals, one at the Office of the Prime Minister (OPM) and another in the ministry of Public Service (pension), that have so far claimed many scalps. According to Lokodo, Shs 38.3bn was lost in the OPM scandal alone.

However, not all the Shs 38.3 billion was completely lost, he explained. Some of the money meant for the Peace, Recovery and Development Project (PRDP) was diverted to fund other activities, without proper authorisation. For instance, Shs 1.8 billion was used to procure eight vehicles for seven ministers and the Prime Minister.

Lokodo said Shs 169 billion was lost in the pension scam.

"The country is currently besieged by grand corruption and mismanagement of public funds," the minister admitted.

Due to the recent corruption cases, several development partners including Ireland, Norway, Britain, Denmark and Sweden have cut or threatened to cut aid to the country. The World Bank on Monday said it was reviewing its development assistance to Uganda.

"The journey is to bring all people suspected of swindling public funds to account," Lokodo said, stressing that "corruption is worse than terrorism. Terrorism kills few people but how many people die in health centres due to corruption?"

Drastic measures

To save the government's image, Lokodo said, structural, political, administrative as well as legal measures have been devised to check corruption. Some of these include steps to control donor disbursements through Bank of Uganda and the Treasury.

"All flows will first be remitted to the Consolidated Fund Appropriation Account before the funds are moved to the beneficiary accounts instead of suspense accounts," he stressed.

Government, Lokodo further explained, is to ensure all dormant project accounts in Bank of Uganda are closed. Government has also undertaken to ensure that bank reconciliations by all accounting officers are done monthly as opposed to quarterly and annual. He said this move will to enable timely detection of fraud.

"The ministry of Public Service has been directed to reconcile and clean up the salary and pension payroll to remove all ghost workers," Lokodo added.

Payment of pension and salary is to be moved to the Integrated Personnel and Payroll System (IPPS) by December 2012 to eliminate diversion of funds from the intended beneficiaries.

Cabinet has come up with a policy of regular rotation of staff, particularly those involved in direct management of public funds like accountants and procurement officers. The reason behind this is that when these officers spend a lot of time in one place, they learn tricks of manipulating systems and swindling funds.

Corruption, Lokodo stressed, can lead to the downfall of government by undermining its legitimacy, weakening its structures, worsening poverty and income inequality and therefore creating social and political unrest. Among other measures, the government plans to ensure that all civil servants declare their wealth and those with questionable wealth get to explain the source.

"We are also going to expedite the Anti Corruption (Amendment) Bill 2012 to enable government attach the property of corrupt government officials," he said.

The private member's bill, moved by Makindye East MP John Ssimbwa, seeks to introduce a provision spelling out how the property of a corrupt official can be confiscated.

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