27 January 2013

Uganda: How OPM's Sh38 Billion Donor Cash Was Spent

THE scam in which billions of shillings meant to rehabilitate northern Uganda were allegedly misappropriated under the Office of the Prime Minister (OPM) is getting clearer.

New Vision Online has accessed a document from the OPM showing how the sh38b donors contributed to the basket fund was spent.

NUSAF cash safe:

The document, which OPM's Permanent Secretary Pius Bigirima, has acknowledged, also shows that most of the sh50b raised for the Peace Recovery and Development Plan (PRDP) of northern Uganda, was accounted for. According to the document, only sh13.4b is unaccounted for. It also attributes the entire misappropriation to the former Principal Accountant of the OPM, Geoffrey Kazinda.

Kazinda is currently on remand at Luzira Prison in connection with the scam.

"We chose to draft this document to make the records clearer. The truth is that of the sh50b fund, the donor component is about sh38b.

"All the funds remitted by the World Bank and DFID for NUSAF2 activities in northern Uganda and Karamoja totalling sh123.5b were disbursed to districts and communities and their accountability stands at 95%. Therefore, no funds under NUSAF2 were involved in this scam, whatsoever," Bigirima explained.

PRDP funds spent:

The document highlights what the PRDP funds achieved.

"Four countries, namely Norway, Ireland, Sweden and Denmark supported the PRDP through a basket fund managed by the finance ministry

"At the time of the audit, sh75.777b had been contributed by the donors, out of which sh38.291b was disbursed to OPM," the documents reads.

This money, it notes, was used to construct 54 houses for Acholi traditional chiefs, resettle people from Internally Displaced People's camps and obtain 29 heavy-duty tractors.

Moses Watasa, the commissioner for information in OPM, confirmed that the tractors are working in Karamoja. Other activities include opening 10,201 acres of land in northern Uganda, distribution of 950 tons of planting materials, 350 ox-ploughs, 700 oxen and 350 heifers.

During the 2010/11 financial year, the document adds, sh6.2b was used in the pro¬curement and construction of ferries on Lake Kyoga and Bisina.

"The ferries were considered vital in addressing the persistent transport challenges in northern Uganda following the LRA insurgency. During the 2001, 2006 and 2011 campaigns, President Yoweri Museveni pledged a ferry to the people of Teso sub-region," Bigirimana explained

Recently, works ministry spokesperson Susan Kataike, confirmed that parts of the ferry had been purchased and it was pending assembling.

The document also highlights the procurement of 60,000 iron sheets, 60 hydra foam machines, and extension of electricity to Oyam, Tororo, Soroti and Kaberamaido districts

"The rest of the funds were spent on food and non-food relief items for disaster-stricken communities as well as other development activities. Out of this, sh769.5m is questioned by the AG as unjustified and another sh6.953b as fraudulently deposited on the National Policy on Disaster Management Account, without the knowledge of the accounting officer."

Questions arise:

However, the deputy chairperson of the Public Accounts Committee, Paul Mwiru, dismissed the document, saying its figures were not tallying with what is on ground.

"Why is the document highlighting about sh13.4b as the entire donor money misappropriated when the Government has refunded sh21b to Norway alone? How about other countries?" Mwiru asked.

A forensic audit by the Auditor General (AG) exposed scam in the way the OPM handled the funds under the PRDP. The AG and the directorate of Criminal Intelligence and Investigations are studying documents Kazinda submitted to account for the funds.

What went wrong?

The document attributes the major setback to the failure of by OPM, Bank of Uganda and finance ministry in following the procedures of using the funds. It alleges that officials in these institutions connived to misappropriate the funds.

The donor countries and the Government had agreed that the funds be put onto the Consolidated Fund Account for proper budgeting, which did not happen. Instead, officials of the OPM who received the money deposited it on their personal accounts.

But, Bigirima said the funds which were deposited on the personal accounts were not necessarily misappropriated.

While Parliament recommended that Bigirima steps down over the scam, President Yoweri Museveni insists the permanent secretary is a whistle blower, who did not committee any crime.

Bigirimana has been grilled by the parliamentary Public Accounts Committee and according to Mwiru it is still too early to exonerate or convict him and the others. Out of the sh11b, sh7b was queried by the AG. The officials who are supposed to account for the funds look bewildered when they appear before Parliament.


The Government refunded the lost monies to donors as an acknowledgement that its officials acted fraudulently.

"Although we refunded the money, the culprits are being investigated and will be prosecuted, and the money will be recovered from their assets," Bigirimana said.

Ministers' vehicles:

According to the document, in the 2011/12 financial year, sh20.17b was deposited by the Accountant General on a dormant Crisis Management Account, without the knowledge of the accounting officer. However, Kazinda was reportedly aware of the transaction.

Out of the sh20.17b, Kazinda is alleged to have advised that sh13.77b be used for a number of activities including the purchase of vehicles for newly appointed Government ministers. Bigirimana endorsed Kazinda's advice, but details of the balance are scanty.

Way forward:

The scam may have delayed the implementation of PRDP activities, but according to Bigirimana, it has not killed the burning hope among the people of northern Uganda. Watasa also says OPM will now be channelling funds directly to the beneficiaries through districts.

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