21 November 2012

Uganda: Umeme Wrongfully Put in Bad Light


On Monday this week somebody delivered to me at Plot 10, Kyadondo Road (NRM HQs) a hard copy 161-page report of the belated Parliament ad hoc committee on energy.

There, he was availed my email, to which an electronic copy was then sent with pleas to publish its "findings and recommendations."

The delivery of this report coincided with leaks to various media houses about the same, in which, so far, electricity distributor Umeme is being faulted on the concession, its performance, power losses and alleged high tariffs to end users. Surely, for the 'bad contract terms' our government, and not Umeme, is to blame!

Even without verifying the veracity of the report's contents, the only conclusion I draw is the intention was malicious, negative and a conspiracy to use the media and Parliament to wage an essentially corporate war on the emerging lucrative energy sector-generation and distribution.

The leaks leave the undeniable conclusion that perhaps the committee did not complete its job after all, after colossal amounts of money were spent over 16 months, and cannot formally present the report in Parliament due to some disagreements. It instead asks the Auditor General to conduct further investigations!

There have been unconfirmed allegations of bribery to some committee members and MPs generally by the different interested parties.

Parliament and its committees are supposed to be places for prudent legislation and policy control, but are unfortunately being turned into an arena for malicious, pitiful, spiteful and unsupported propaganda, where no serious, honest and factual discourse can take place.

The various innuendos of MPs like Gerald Karuhanga, among others, since the Ninth Parliament opened, beg more questions than answers.

These leaks leave the integrity of the committee in tatters, particularly because business speculators posing as bona fide investors infiltrated the probe and fed malicious and unsupported claims in the hope to win favours in the most unlikely event that the Umeme contract is terminated as being recommended.

Brought with the report were several documents from a local private firm, Ferdsult Engineering Company to the energy minister asking for the review of the Umeme contract in the terms of the company which the ad hoc committee has curiously found relevant. Ferdsult offered to invest $150m if given the contract to distribute power.

Ferdsualt began writing the letters in June 2011, copying to President Yoweri Museveni and the Prime Minister, in an attempt to blackmail the energy ministry. When this failed, Parliament jumped into the fray and instituted the probe.

Initially, the allegations were that the true owners of Umeme were unknown and some politicians were said to be behind the deal. But when it emerged that the reputable Commonwealth Development Corporation (CDC) partly owns Umeme, the claims fizzled.

Due to unending blackouts, Umeme was accused of incompetence and looter filching Ugandans. Politicians reminded Ugandans of the 'good old days' of the Uganda Electricity Board (UEB), an outfit that collapsed mainly due to bad management and gross political interference.

Pundits have rightly said Parliament is least competent to conduct credible investigations on technical issues like power generation and distribution, business due diligence and financial audit. It should leave these to the auditor and accountant generals, the Inspectorate of Government and the Police, and only demand action on these reports.

The screaming media headlines about Umeme cheating government through inflated losses and calls to terminate Umeme's contract may be half truths intended to support other scavengers under the guise of "Ugandanisation." The Government can open competition without the costly termination of the Umeme contract.

MPs should resist public policy reversals like when they tried on the former Uganda Commercial Bank (UCB) under a misplaced guise of "The peoples' Own Bank." UCB nearly went to dubious local groups seeking to 'indigenise' the financial sector.

Ugandans lost sh69b to the Haba Group over the dilapidated Kampala markets, and it would not be prudent to push for the termination of Umeme's contract termination at this point. It also sends bad and negative signals to prospective investors when policies are reversed each time local groups make horrendous but unsubstantiated allegations.

President Museveni should be firm against reversals of prudent and effective policies without genuine and verifiable facts laid on the table.

Yes, Umeme tariffs may be higher than Kenya, Tanzania and Rwanda, but this cannot only be explained by a single factor as the committee would wish the public to believe. Uganda has gone through decades of economic stagnation and decadence. Incidentally, electricity tariffs are not the only items charged higher on the Ugandan market!

Ofwono Opondo is the NRM deputy spokesperson, and leader of Urtaf, a Kampala think tank.

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