The Observer (Kampala)

19 August 2014

Uganda: Eng Byandala Blames Nasasira, Tumwebaze for Mukono Road Mess

Works and Transport minister Abraham Byandala, 60, has been in the news for his role in the award of a Shs 165bn contract for the construction of Mukono-Katosi road to a bogus firm.

The Katikamu North MP is specifically accused of directing UNRA to sign the contract before due diligence was complete. In an extensive interview with Edris Kiggundu and Deo Walusimbi on Monday, Byandala accused his cabinet colleagues of using the scandal to fight him politically. Below are excerpts:

Recently your name came up prominently in the controversial award of a contract for the construction of the Mukono-Katosi road. What was your role in this contract and how was the entire project conceptualised?

That project was conceived in 2010. There was pre-qualification, they [UNRA] assessed the people who expressed interest and then the list of the pre-qualified firms was completed in October 2010. In November 2010, they made an invitation to bid. When they put their pre-qualification submissions, the American company [Eutaw] was evaluated as the best company, and it was approved in February 2011 and they went into negotiations.

They couldn't sign the contract because there was no money, but in the meantime, these people [Eutaw] visited the President (Museveni) in State House, and Honourable John Nasasira visited them in the United States. That was before I came in this office. But while in this office, they [Eutaw] also came to see me. They asked about this job and I told them that we didn't have money.

Later, I attended a meeting with the president and these people in Kisozi. They [Eutaw] said they were ready to fund the road and he [Museveni] said it's okay, I have no problem; you go and discuss with the minister of Finance about the terms. So, in the subsequent financial year 2011-2012, I was here, but they [Finance] gave us money for only one road, which is Moroto-Nakapiripirit.

That meant that we couldn't still do this road (Mukono-Katosi). Then last financial year, they [Finance] gave me money to do these roads and I told UNRA [Uganda National Roads Authority] that; you had already procured nine roads, and I asked them [whether] we couldn't revive other roads [including Mukono-Katosi].

They said we shall see. Then, we looked at Mpigi-Kanoni [and] it was possible and [we] revived it. We tried Kanoni-Sembabule, we couldn't because the contractor was not credible, then we considered this Mukono-Katosi road and they said it was possible. So, I said, go ahead. They went into the whole process of resurrecting all [roads], including [following] the PPDA Act and all other technical procedures.

In the process, these people [Eutaw] even approached the Vice President [Edward Ssekandi] while he was in New York to represent us. They told him that they had successfully bid [but they were not being given the contract]. When he came back, he asked me, I explained to him. So, after doing all the technical work, Unra invited these people to sign a contract.

I don't know how many days they spent here but when they were supposed to sign the contract, they [UNRA] received an email from [whistle-blowers] saying that those people who are going to sign are not genuine.

What happened next?

UNRA said no, that is not true; they produced a company resolution [from Eutaw] forming a special-purpose vehicle to do the work and they showed them [whistleblowers] the letter in which they stipulated who are the directors, secretary and all other details, and then the UNRA lawyer said it seems to be a genuine company.

So, these Americans came again in this office complaining that "honourable minister, we have been here moving up and down, now these people are saying we can't sign."

They were very bitter, and then I rang UNRA and said, what is happening? They told me that they had made some [internal] investigations on the company.

So, what did you do as the senior minister?

I asked the lawyer [of UNRA] whether with their clarification (investigation) they thought the firm was genuine. He said their papers look genuine, and I asked him, supposing they are not genuine, can we cancel the contract? And he said "yes."

Did you seek an opinion from the attorney general or solicitor general?

I verbally talked to Honourable Fred Ruhindi (deputy attorney general). I told him, "I have a small problem in my office; we have a company, but there is a small question mark. Supposing we sign, will it be easy to terminate the contract?" He said, "yes, except, you can only do that in court and it may take long."

Then I said: "What if we put a clause that in case we find that you are not genuine we automatically cancel the contract in the agreement?" And he said: "That is enough."

So, I told them [what Ruhindi had told me] and they put it in the contract (shows The Observer the contract) and I don't think there is any contract where such a clause is.

What have your own investigations about that company revealed?

Well, I don't know because I wrote a letter to them (UNRA) telling them that "sign the contract, but go ahead with your due diligence. In the meantime, on 5th December 2013, UNRA wrote to that company to tell them that they want to come and do due diligence, and they [Eutaw] replied on December 10th and told them that you can come in February 2014. But up to now UNRA has never gone, I don't know why.

Who sourced this company, because you alluded to the fact that they met the president and the vice president over this deal?

There is a local company called High-Tides Ltd, which signed a contract with them, claiming they were going to assist them in procurement and legal issues, and they agreed a fee of $1.75m. They are the people who brought them.

I haven't checked, but somebody was telling me that this company has relatives of Frank Tumwebaze, relatives of I think [John] Byabagambi (junior minister for Works and Transport), relatives of [Robert] Kabushenga and maybe [Richard] Kaijuka.

So, for me, I was in a dilemma because this project (Mukono-Katosi) had been on from 1996, and we wanted to deliver a service, a pre-qualification was done on this company, my colleague [Nasasira]visited them in the [United] States. These people had the guts to go to State House to meet the pesident not once, they had the guts to meet the vice president, they had the guts to say for us we have our money, let us do the work you will pay us later.

Don't you think the buck eventually stops with you, because you sanctioned the payment of billions in your letter to UNRA?

But there are two issues; when I direct you to sign; I don't say you sign anything. Assuming you are selling vehicles and you have a worker and you tell him to receive Byandala's money and give him a car. If you receive fake money, is it your problem because you said receive Byandala's money?

So, even here when I said you sign, I didn't say sign non-genuine [things] and after signing, you have to bring the performance guarantee for a bank to give you a down payment guarantee.

As the political head of this ministry; would you take personal responsibility for this scam?

Why? No. I told them [UNRA] to sign, I didn't sign anything.

But they acted on your orders...

But there was ample time for them to do due diligence from 14th November to 30th December 2013 when they finalised those things. Why didn't they go to the United States [to do due diligence on the company]?

So, whom do you blame for this mess?

In fact, it's very funny because there was a pre-qualification exercise [by UNRA] and at that stage, you can tell a lot whether the company is genuine or not.

You know many of these companies now prefer to get insurance bonds to prove they are capable of executing the contract.

But personally I have never trusted insurance bonds. I prefer bank guarantees because with them, money must be on the account, unlike these insurance bonds which this company used. By the time the company withdrew a bank guarantee to go for an insurance bond, Unra would have taken keen interest in that alone.

Are you saying the government has signed many deals with dubious companies as long as they present insurance bonds?

I can tell you one thing; when I came here, I had a problem with the leader of the Procurement and Disposal Unit (PDU). I found he was not performing well. I told this fellow that go back to the ministry of Finance and be deployed somewhere else.

The man refused. I can tell you it was a war, but we eventually put our foot down. Everyone was afraid of him because he had links with the former accountant general and he had a strong relationship with someone in the IGG [office]. So, whoever tried to remove him, he would just say that "I will take the matter to the IGG" and everybody gave up on him.

But this person sanctioned so many insurance bonds which we discovered were fake.

How many contracts were sanctioned as a result of fake bonds?

All of them were fake. But you know Uganda, because of his connections, everything disappeared.

Who is this man?

Denis Ayo. My new PDU head (a lady) has already discovered over 10 fake performance bonds and if you checked with all these ministries [that award contracts], you might find that almost 80 per cent have been issued with fake performance bonds by dubious contractors.

What does this tell us about the calibre of companies we award contracts?

It means that they are either not competent or not genuine. For local ones, they can't afford bonds, and that is why in most cases, they end up forging them.

The second thing is that there may be a clique of people in Kampala who are monitoring jobs and they have links in these banks and insurance companies. It is these people who benefit from fake insurance bonds.

But that suggests that we have lost billions through these fake bonds scam; what have you done about it?

It's dangerous; if you reported [the firms] to the PPDA, that means the company is blacklisted and that is killing somebody. So you can also be killed.

You sound very threatened by the dubious deals you discovered in the office; are you scared for your life?

Those rich people who do business and make money have one thing in common. It's better to be rich than be right and if you listen to the stories of the rich people, it's not simple.

So, are you giving in to the mafias instead of doing something to clear the image of your ministry?

No, I can never work with them because I have worked for over 45 years as an engineer and to tell you the fact, since I came into this office, people are saying that I am uncooperative because I don't want to be involved in those things. If you take somebody's money, you can never get settled and if you take money from government, you can never know when it will crop up. Why should I live such a life?

Where do you see your life politically with this scandal?

When we were going for the 2011 election, I was chairman of the Physical Infrastructure Committee in parliament and I spearheaded that Land Amendment Bill. Mengo people said that I was finished, but I explained to my people and in 2011 they were holding me high up. So this can't [finish me] because I haven't done anything and you cannot pin anything on me.

Why do you think your name has been more pronounced of all people involved?

They want this office.

So, are you suggesting that it's politics at play?

Yes.

Who are these people who want your office?

These stories were taken to The New Vision by Frank Tumwebaze [the minister for the Presidency].

But why would Tumwebaze fight you?

Maybe it's a group game because the major sponsor of this is [John] Nasasira. I have got these people who talk on radios. They tell me that they have been promised money and that the moment they win this war, they will buy them cars. They have been given money to go to radios [and tarnish my name].

Frank has a hand in Tides though he is not a director in this company...

Why would Nasasira fight you?

He wants to come back [as minister of Works].

But we all know that it's the president who appoints people to various ministries. Why would Nasasira be so sure that once you are out, he will come back in?

When I leave, he has a chance, but when I am here, there is no chance.

Have you brought all this to the attention of the president?

No, it's not my method of work.

Aren't you scared that the president will sack you over these troubling allegations?

No, the president doesn't act on rumors, you must produce evidence. If he was working on rumours, nobody would be in office for even a week, because every week people write reports, for example about me, but for me I don't care.

What if these people fight you in your constituency in 2016?

For me, it's not a choice between life and death to be an MP; I am 60 years plus, I have been at this thing for about eight years now, I am even worse off than before because I was doing better at family level. I have life after [politics] because I am a professional [engineer] who can do something else.

How do you describe your relationship with your junior minister John Byabagambi. He cancelled the standard gauge railway contract virtually without consulting you?

Well, when we started the standard gauge railway, I had a discussion with the president, and we reached an agreement. Because I am a busy man and we wanted someone focused on this, we agreed to let the state minister [Byabagambi] handle it.

He will be briefing me and the president and we see what to do. That is why you have not heard me [say anything] [regarding the standard gauge railway].

Do you think the cancellation of the MoU between government and a Chinese firm (CCECC), as proposed by Byabagambi, is the best way forward?

I wrote to the attorney general about it, because there were conflicting statements from the attorney general's office; that we can't cancel.

So, I wrote trying to seek clarification and he gave me some advice and I came and discussed with Honourable Byabagambi. But I think before he could move with what was agreed, those people (CCECC) went to court.

Lastly, what would you say are the tangible achievements and notable challenges you have encountered over the three years you have held this office?

I have made a lot of achievements because a number of roads have been completed, about 10-15 roads. I am handling over 15 roads right now at different stages and when you move around the country, you see that road construction is on-going everywhere.

We have managed to lower the unit price of constructing a road because by the time I came here, a kilometre was $1m plus, but we have managed to bring it down to $700,000.

As for the challenges, we lack local capacity; that is why most of the roads are being given to foreign companies. UNRA has small staff with a lot of work, so, they are over-burdened.

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