Row erupts over Shs800b internet project

The project is being implemented by the National Information Technology Authority-Uganda (NITA-U), with oversight of the Ministry of ICT. NITA-U is the statutory body mandated to coordinate government IT services.

The fallout from handling the dual tender for the fibre optic cable and designing, supplying and installing the MAN Centre, knowledgeable sources told Sunday Monitor, culminated in the exiting of several technical staff through non-renewal of their contracts last month.

The staff, sources indicated, had for months butted heads with NITA-U top management over hiring a single vendor for the two components as opposed to making the ToRs vendor agnostic to attract multiple vendors as in the custom in cyber security.

For instance, while Huawei built the fibre optic system to link all government operations on a single network during the initial phases of the NBI/eGI project, the government turned to the Dell system and Juniper firewall, respectively, developed by American companies Dell Inc. and Juniper Network, for network security. 

Juniper also designed the first MAN Centre housed at Statistics House, on Colville Street in Kampala. The MAN Centre connects computer systems within a wider, metropolitan area.

In this case, IT experts explained, it makes the system less susceptible to hacks as penetrating the walls of one vendor doesn’t make it easy to penetrate the walls of another. “It is a case of not putting one’s eggs in one basket,” one IT expert explained. 

Under UDAP-GOVNET, sources intimated that the NITA-U top leadership favoured handing Huawei the dual tender for fibre optic cable and the MAN Centre, which a section of technical staff opposed on grounds that it went against customary cybersecurity practices but could also compromise government information flowing through the system in case “a backdoor is created” or in case of hacking.

“Juniper firewalls ensured that Chinese would fail if they implemented any backdoors on the government network,” a technical staff familiar with the project said on condition of anonymity.

Huawei, which in Uganda has among others implemented the first phases of the NBI/eGI and the Shs467b closed-circuit television camera (CCTV) system for police, has been previously accused by several Western governments of espionage. No evidence against the company was, however, brought forward.

On its website, Huawei Technologies describes itself as an independent company, committed to supporting the secure operations of our customers’ networks and services.

“These days, there is much debate about Chinese intelligence law. Some groups of politicians claim that Chinese law allows the government to force companies to collect intelligence on its behalf. This is simply not true. The Chinese government has been explicitly clear about this, as have multiple independent legal professors and a well-known international law firm: Government requests for company assistance must be in accordance with the law,” it says.

The company adds: “There is no Chinese law authorising the state intelligence agency to require a telecommunications equipment manufacturer to implant backdoors or disable customer networks. The Chinese government does not interfere with our business or the security of our products. And if any attempt were made to force our hand – from any country or organisation – we would reject it outright.”

Slack

According to documents seen by this publication, NITA-U in February put out a procurement request for proposals for designing, supplying, and installation of a MAN Centre infrastructure and facilities upgrade in a new space allocated inside the Statistics House.

The request for proposals required bidders with related computing experience with at least three prior similar assignments. Then came the routine butting of heads in procurements.

Huawei in Uganda did not immediately respond to our inquiries when contacted during the week. The company’s public relations officer indicated he was also waiting for information from his superiors.

Monitor has since established that the procurement process for the tender has stalled following the mass “non-renewal” of contracts of key staff. The staff included key members of the evaluations committee, procurement and disposable unit, and the contracts committee pertinent to the project.

Meanwhile, the development comes against a backdrop of the UDAP-GOVNET project funder, the World Bank, variously complaining about the slow progress of the $200m with the absorption of the money at only $6m (Shs22b), representing 6 percent as at April.

The NITA-U executive director, Dr Hatwib Mugasa, also put all staff on notice about “directly contacting” World Bank officials to confer on aspects of the project.

“It has come to my attention that various staff are directly contacting World Bank officials, to consult or discuss procurement-related matters, without following proper communication channels. As an independent implementing agency under UDAP, we are expected to handle internal consultations and channel any queries to the Bank through the defined formal communication channels, through the executive director/or the project coordinator,” Dr Mugasa said in an internal memo addressed to all staff.

He added: “The bank has indicated that going forward they do not expect communication, formal or informal, to be made directly to their offices on operational matters including procurements, finances or otherwise, other than through the above channels or officers. This is also to continue to enforce their zero tolerance to corruption or the risk of being misrepresented, meddling in internal agency matters and or other unpleasant outcomes such unstructured communication may cause.”

The UDAP-GOVNET project was signed off by the World Bank in June 2021 as a $60m grant and $140m loan.

The project aims to expand access to high-speed internet, improve the efficiency of digital government services, and strengthen the digital inclusion of refugees and host communities in north-eastern and south-western Uganda.

However, since commencement on May 17, 2023, the project has been beset by numerous setbacks, which insiders attribute to “implementation incompetence”.

The World Bank, according to insiders, has variously, including during review meetings, expressed concern about this slow progress, including NITA-U’s months-long “delays” in clearance of key contracts for the project.

Monitor reached out to Dr Mugasa for a comment on the matter in an email of inquiries on July 11 but got no response. 

His technical supervisor, the ICT ministry permanent secretary, Dr Aminah Zawedde told Monitor in an email that “we are initiating an inquiry into the allegations to ascertain the facts and address any irregularities”.

“We have been made aware of these allegations within one of the agencies under our supervision. Ensuring the integrity and accountability of our operations is very important to us. Our commitment to maintaining high standards of ethical conduct and transparency across all our agencies remains steadfast. Should any issues be confirmed, appropriate actions will be taken to address them,” Dr Zawedde noted.

Sparks fly

In a June 20 letter, the World Bank’s acting country manager, Dr Rogers Ayiko, detailed the need to “significantly accelerate” the project implementation to complete project activities by the closing date—May 2026.

“The project was approved by the World Bank board of directors on June 2, 2021, the financing and project agreements were signed on January 27, 2023, and the project was declared effective on May 17, 2023. An ineligible expenditure amounting to $249,500 under the previous Regional Communication Infrastructure Project - Phase 5 (RCIP-5), P130871, was refunded in November 2023, enabling disbursements. Disbursements in the amount of $10.5m had been made by April 2024, representing only 6 percent of disbursements and commitments stood at only 3 percent. A further disbursement of $6.14m was made after the mission in May 2024, bringing the total disbursements to $16.6m (9 percent),” Dr Ayiko, wrote, the letter also addressed to the permanent secretaries of the Ministries of Energy, Office of the Prime Minister, Education, and Solicitor General Francis Atoke.

Dr Ayiko further detailed that of the 40 project activities worth $88m (Shs323b) that have been programmed into Systematic Tracking of Exchanges in Procurement (STEP)—an online tool that helps the bank and borrowers plan, record, and track key stages of the procurement process of projects—13 activities valued at $5.4 (Shs19.8b) or 3 percent have already been contracted, 30 percent of which are for project management activities. 

The remaining activities, he noted, are at various stages of preparation, bid evaluation, and contract signing; only $11.4m (Shs41.8b) or 6 percent procurements have been launched, while the mission had agreed on a target to award additional contracts worth $56.1m (Shs206b) by August 2024 and $82.6m (Shs303b) by December 2024 raising the commitment rate from 3 percent to approximately 30 percent and 44 percent respectively.

“Upstream studies to inform models to adopt and in particular, options for addressing the need to mobilise additional private sector participation are delayed and stand on the critical path of one third of project activities. The mission noted that procurement of three critical upstream studies that have a downstream effect on related procurement activities (e.g., deployment of last mile connectivity solutions in ministries, departments, and agencies (MDAs), mobile broadband solutions in rural areas, and establishment of the third data centre) have yet to conclude. These upstream studies are very important, as they will serve to inform possibilities and best models to mobilise further private sector participation in project activities, a priority objective,” Dr Ayiko wrote.

The UDAP-GOVNET project involves four components; expanding digital connectivity in selected areas, which seeks to bridge the digital divide by improving access to high-speed internet in unserved and selected communities in Uganda, through a combination of infrastructure investments and policy reforms.

The second component is digital transformation of the government which includes boosting the efficiency and effectiveness of digital government services and creating foundations for better resilience, climate adaptation and economic recovery. The third aspect is promoting digital inclusion in the refugee-hosting districts.

Project optics

NITA-U first engaged in a turf war with its parent Ministry of ICT over supervision of the project throughout 2022. The fight was neutralised by creating project implementation sub-committees, with supervisory powers, and a steering and technical committee, but with NITA-U as the implementing unit.

The project steering committee, which serves as the executive board, comprises technical officials from the ministries of ICT, Finance, Local Government, National Environment Management Authority (Nema), Office of Prime Minister (OPM), and Public Procurement and Disposal of Public Assets Authority (PPDA).

The technical committee includes officials in the ICT ministry, and reviews all aspects including ToRs and contracts, while NITA-U is charged with the bulk of project implementation.

In 2006 the government acquired $106m from China’s Export-Import (EXIM) Bank to implement the optical fibre cable to link all government offices and the supply and installation of communication equipment to enable the transmission of voice, data and conferencing services.

Phase one of the project was completed in June 2008 and involved the laying of optical fibre cable within Kampala and Entebbe to link 27 MDAs and laying of 168km of fibre linking Kampala to Mukono, Bombo and Jinja.

Phase Two ran from 2009 to 2013 encompassing laying 1,400km of fibre connecting Busia, Tororo, Mbale, Malaba, Kumi, Soroti, Lira, Gulu, Elegu, Masindi, Kyenjojo, Fort Portal, Kasese, Bushenyi, Mbarara, Nakasongola and Luweero, and construction of a data centre at Statistics House in Kampala for managing all e-government services on the NBI/eGI.

Phase Three ran from 2016 to 2017, covering 756km of high-speed optical fibre cable from Kampala to western Uganda and the borders with Tanzania and Rwanda.

Phase Four was funded by the World Bank under the Regional Communications Infrastructure Programme (RCIP) to the tune of $75m (Shs275b) between 2016 and 2022 to extend ICT backbone to West Nile districts and border points with DR Congo and South Sudan.

Last October, the government embarked on borrowing $144m from Exim Bank for Phase Five which includes, among others, laying 3,604km of fibre cable network and 51 backbone transmission points to increase coverage of the backbone network.

NITA-U took over management of the NBI/eGI in 2010 following its creation a year earlier. President Museveni, however, has since decreed that management and commercialisation of the fibre optic system be handed to the newly founded Uganda Telecommunications Corporation Limited (UTCL), the successor company of Uganda Telecoms Limited (UTL).

The authority, backed by senior officials in the Ministry of ICT, had since last December deflected calls to surrender the NBI/eGI and the Data Centre to UTCL. Last month, the President read a riot act for the NITA-U/ICT officials over the same, prompting Dr Mugasa to write on July 16 noting that they are ready to handover.