On Sept. 17, our interview with John Masanda, a director at Pioneer Easy Bus Ltd, was interrupted with a phone call.
"When are our buses returning on the road?" The caller asked Masanda, who kept shaking his head. "Anytime from now," Masanda told the caller, adding, "We are in advanced stages of our negotiations with relevant authorities on the matter." The caller then hung up.
Masanda told The Independent that many people call him - and his colleagues - everyday requiring them to explain what exactly is happening to the buses and when they would get back on the road. "We also want them back but negotiations are taking long," he says.
Masanda said they are ready to resume business but endless meetings with relevant authorities particularly the Ministry of Works are still holding them back. The company has also been in intense discussions with Kampala Capital City Authority (KCCA) which granted them license to operate on the Eastern and Western routes of Kampala.
Masanda said they have agreed with KCCA and the leadership of Mukono and Wakiso districts to continue plying to those districts. Under the negotiations, Masanda said Wakiso and Mukono districts would legally become destinations for PEB.
As part of the new contract, KCCA would find a way of remitting part of the revenues to the two local governments. "We have no problem with KCCA. What is left is to sign a fresh MoU with them and then we will get back on the road," said Masanda.
Earlier in May, the bus company got a notice from the Uganda Revenue Authority that 99 buses face auctioning to recover a reported Shs 8 billion in tax arrears, which accumulated as a result of importation of the 100 Chinese Yutong buses as exercise duty and import duty interest.
President Yoweri Museveni promptly intervened and ordered a stay of the auction. Museveni, at the last minute, recommended that the company be allowed to pay the tax arrears in installments. But since then, the bright orange buses have remained parked at Namboole National Stadium.
If Pioneer thought this apparent Presidential sympathy would soften the ground for a quick resolution of their predicament, it was mistaken. The last meeting to be held to discuss the President's directive was on Sept. 6 at Ministry of Works and Transport head offices on Old Port bell Road.
The meeting was reportedly attended by a representative from PEB, works Permanent Secretary, Alex Okello, representatives from Mukono and Wakiso local governments. But there were no major resolutions, a source which attended the meeting told The Independent. The negotiations have since stalled following endless official travels of the chief mediator, Alex Okello, the Permanent Secretary at the Works ministry.
Masanda said they have "verbal agreements" with KCCA and URA and are soon going to formally sign MoU's to resume business. What is keeping them out for now is the ministry of works which has to do one or two more meetings to let the bus company resume public transport in the city. But the date for the buses to get back on the road remains unknown.
"If all goes well, by end of month (September) we will resume business," said Masanda. "The buses are available. We have access to them and they are in good condition."
Masanda said under the new arrangement, government will commit itself to put in place a special bus lane and give exclusive routes for buses among other issues. He said the bus lane will see all Multiplex parking spaces disappear. He added that the Works and Transport ministry will closely monitor PEB's business together with KCCA.
He said they have plans to somewhat raise transport fares by Shs 300 from the previous Shs 1,200 to Shs 1, 500 to help the company sustain daily business activities and stay afloat in the long term. Masanda dismissed claims that the company is broke as alleged by some people. "Money is not a problem," he said, adding that they have capital to bring in as many buses as possible in line with market demands.
Whereas Masanda claimed that they had agreed with URA on paying the tax debt in a period of 18 months upon starting business, officials from URA said they did not have information to that effect.
"We have not agreed with Pioneer on that," Paul Kyeyune, the manager for public and corporate affairs, said in a phone interview on Sept. 19. "We told them to come up with a clear payment plan like the President proposed but up to now they have not appeared. What they are telling you is not correct."
When The Independent pressed Masanda to respond to Kyeyune's assertion, he said: "We are dealt directly with the Commissioner General (Allen Kagina) and other top URA officials. We have agreed that the debt will be cleared in 18 months from the time we resume commercial business. What is remaining is to write and sign a MoU."
Kyeyune, however said URA's doors are open for more talks and they will not hurry to auction the buses. "We all want to see these buses transporting people. We also want the company to grow but that does not mean that it has to dodge its obligation to pay taxes," he said.
Masanda said they would have met their obligation of paying the taxes if URA had allowed them to work, insisting that their revenue source is from ticket sales. "But they refused," he said.
Kyeyune said granting PEBL permission to do business was risky for the tax collector. "We were not sure about their ability to pay back," Kyeyune said. He added that URA would lose after a year or more if PEBL failed to pay the debt because the busses were depreciating with time and so they would not be able to recover their taxes in case of default because of the depreciation factor.
Also, the URA was not sure about the financial status of the company as it was possible that it might have had other creditors.
"But like I said, they are free to come to us," Kyeyune said, adding I do not want to speculate what will happen if we fail to agree with them. "That will be for the Commissioner General to decide."
Officials at KCCA were also non-committal on the matter saying they were still reviewing PEBL's contract. They said the authority is working together with the ministry of works and transport and URA to ensure that MoUs are signed at an appropriate time to have the buses back on the road.
However, reports from the ongoing negotiations between the parties, which The Independent has seen, appear to suggest that Pioneer Buses are standing on thin ground.
One report dated May 2013 says whereas KCCA designated and identified areas where bus lanes and stops were feasible subject to being gazetted, KCCA claimed in one meeting that the provision of bus lanes was a challenge due to limitation in the road capacity and the impact of bus lanes to other road users.