17 January 2018

Uganda: Whistle-Blower Cites Fraud in Nita-U's Internet Deals

A whistle-blower attached to the Internal Security Organisation (ISO) has raised a red flag on the on-going procurement process for a World Bank-funded internet connectivity infrastructure project.

According to the whistle-blower, government might get a raw deal from the $75 million (Shs 270 billion) Regional Communications Infrastructure Program (RCIP), since the project is most likely going to be awarded to the highest bidder.

The RCIP project is being implemented by National Information Technology Authority - Uganda (NITA-U), and is intended to improve government's efficiency and transparency through e-government applications as well as lower internet connectivity prices and extend the geographic reach of broadband networks.

The procurement was initiated on August 3, 2017 after NITA-U ran an advert in the New Vision inviting bids to implement the project. The bid attracted six companies: Wanainchi Telecom, ZTE, Camsat, Banwidth & Crown services + Wuhang Fibre Home, Raubex Infra (Pty) and Huawei.

While Huawei submitted the highest bid price of $15.8 million (about Shs 57.7 billion), it has since emerged as the favoured company for the project.

According to the whistle-blower, Hauwei had been shortlisted along with another Chinese telecommunications company, ZTE, whose bid price was $8.6m (Shs 31.3 billion). The whistle-blower says by the close of business on January 15, 2018, ZTE had been dropped.

Under normal bidding processes, the source said, Huawei would have been side-kicked by virtue of being the highest bidder. The lowest bidder was Camsat, pricing their bid at $8.2m (Shs 29.9 billion).

Interviewed, the chairman of the evaluation committee, Paul Ngabirano, declined to say much since the process is still ongoing.

"The process is still on, and, under the procurement regulations, I am not supposed to comment until it is concluded," Ngabirano said.


NITA-U executive director James Saaka, instead, blamed over-anxious bidders some of whom, he said, had leaked documents on the project to Budadiri West MP Nathan Nandala-Mafabi.

"I know there is a letter that has been written to Mafabi but the procurement process is not yet complete because even I, the accounting officer, haven't seen the evaluation report yet," Saaka said.

"Prospective bidders sometimes get over anxious but they should wait for the process to be concluded," he added.

The latest revelations come against a backdrop of fraudulent scandals that have rocked the body charged with regulating the ICT sector. According to the source, NITA-U bosses entered into multimillion dollar contracts with companies linked to some of the bosses at the IT regulatory agency.

Among such deals, is the contract to certify ICT companies that want to do business with government which was awarded to Comtel Africa. Comtel Africa, owned by a former NITA-U board member, was allowed to take 80 per cent of the revenue it collects and only remit 20 per cent to NITA-U.

While the whistle-blower cites some influence peddling in the deal, Saaka said that the former board member got the contract on merit.

"It was an international competitive bidding process where no one can be accused of influence peddling, being a former board member doesn't stop anyone from doing business, and secondly, he is in partnership with another company," Saaka said.

NITA-U is also said to have conspicuously entered into another contract with SYBYL (Computer Point) to a build a data centre at $13m (Shs 45.5 billion)

NITA-U bosses are also accused of causing the government a monthly loss of more than Shs 30bn paid to Kenyan IT giants Soliton Telmec to offer internet services to government departments and ministries through the national backbone infrastructure.

The whistle-blower claims the $300 (Shs 1.08 million) that the ministries pay per mbps (megabits per second - data transfer speed) is too high compared to what is paid in neighbouring countries like Rwanda where government pays $50 (Shs 180,000) per mbps.

Government is also reported to be cheated in the procurement of Cisco switches, which NITA-U buys at $2,600 (Shs 9.3 million) as opposed to Shs 1.4 million on the open market. It also pays $1,200 (Shs 4.3 million) for manhole covers that the same supplier sells to MTN at Shs 400,000.

Saaka, however, says that the costs were previously high because of fewer users. For instance, he said, in 2011, when the national backbone infrastructure was implemented, government used to pay $1,200 (Shs 4.3 million) per mbps which has drastically fallen to current figure of $70 (Shs 252,000) with 280 government ministries and departments connected in addition to 186 free public Wi-Fi hotspots.


MPs Detained Over Arua Poll Chaos Were Armed, Say Police

Police have said four Members of Parliament arrested over the chaos on Monday, the last day of campaigns for the Arua… Read more »

See What Everyone is Watching

Copyright © 2018 The Observer. All rights reserved. Distributed by AllAfrica Global Media (allAfrica.com). To contact the copyright holder directly for corrections — or for permission to republish or make other authorized use of this material, click here.

AllAfrica publishes around 700 reports a day from more than 140 news organizations and over 500 other institutions and individuals, representing a diversity of positions on every topic. We publish news and views ranging from vigorous opponents of governments to government publications and spokespersons. Publishers named above each report are responsible for their own content, which AllAfrica does not have the legal right to edit or correct.

Articles and commentaries that identify allAfrica.com as the publisher are produced or commissioned by AllAfrica. To address comments or complaints, please Contact us.