Left to Right: Ms Geraldine Ssali, Michael Mawanda (Igara East MP), Lawyer Julius Kirya, Ignatius Wamakuyu (Elgon County MP), Registrar Leonard Kavundira and Paul Akamba (Busiki County) in the dock at the Anti-Corruption Court in Kampala on July 18, 2024. PHOTO | ABUBAKER LUBOWA
On August 25, 2023, the Sectoral Committee on Tourism, Trade and Industry received instructions from the Rt Hon Speaker of Parliament to conduct an Inquiry into the status, governance, resourcing and value for money for public funds allocated to cooperatives during the period of financial years 2011/12 - 2022/23.
The Committee has effectively carried out the inquiry as instructed and now reports.
Findings, observations and recommendations
In the course of the inquiry, the Committee observed that some of the respondents whose presence could have improved on clarity and authenticity of the information, did not honor specific invitations to appear in person. For example, some current and former Members of Parliament who did not appear at the time they were required although they submitted memoranda are cases in point.
In particular, Hon Michael Mawanda Maranga, Hon Patrick Maxwell Akora Ebong, Hon Ignatius Mudimi Wamakuyu and Hon Ann Maria Nankabirwa, were invited.
However, upon a second invitation to Hon Wamakuyu together [with] his cooperative board members to attend the Committee’s meeting to respond to further queries, he (Hon Wamakuyu) together with the board members did not nor the invitation. Likewise, Hon Nankabirwa received a second invitation as Chairperson of Wamala Growers Cooperative Union Limited to attend the Committee’s meeting at Parliament, but she neither appeared physically nor communicated. For the case of Hon Akora Ebong, the Committee extended several invitations but he did not appear.
Budget for compensation
In FY2016/17, the government instituted an Inter-Ministerial Committee led by the Ministry of Trade, Industry and Cooperative to verify claims by cooperative societies for assets and properties that were destroyed during wars and political insurgencies.
Before 2016/17, compensation claims to cooperative societies and unions were handled by the Ministry of Justice and Constitutional Affairs (MJCA), where a total of Shs6.97b had been paid through the MJCA to various cooperative societies and unions. From 2016/17 to 2022/23, compensation claims worth Shs137.86b have been paid through the Ministry of Trade, Industry and Cooperative.
A review of the approved budget estimates, ministerial policy statements, and Budget Committee reports for FY 2016/17 to 2022/23 indicates that a total of Shs172.77b has been appropriated by Parliament through Vote 015: Ministry of Trade, Industry and Cooperative (MTIC) for compensation of war loss claims for Cooperative Unions and Societies.
Whereas the Ministry of Finance, Planning and Economic Development informed the committee that Shs119.89b was released to Ministry of Trade, Industry and Cooperative under Budget Item: 282104 - compensation to 3rd Parties (cooperatives) and expenditure as Shs109.84b, it was established that the actual payments made by MTIC amounts to Shs140.36b.
The Committee was informed by MTIC that MJCA was paid Shs6.97Bn hence the total compensations made by the government is Shs147.22b which is over and above the money allocated to the compensation budget item by Shs37.38b.
The committee established that these variances were a result of diversions and mischarges committed over time by MTIC to cater for compensation at the expense of other budget lines/priorities.
Total claims amounted to Shs620.78b out of which Shs232.92b was verified. Of the verified amounts a total of Shs147.22b has been paid as of 30th June 2023 that is, Shs6.86b by MJCA and Shs140.36b paid by MTIC this leaves an outstanding claim of Shs85.70b.
Payments made in excess
The Committee observed that a total of Shs48.77b worth of compensation paid between FY 2019/20 and 2022/23 was either made in excess or completely outside the amounts allocated to specific cooperative in the MTIC workplan. Notable Cooperatives that were paid under this category include: Lambuli Central Pulpery Cooperative Society Shs4.70b; Jinja Multipurpose Cooperative Society Ltd by Shs4.8b; Buyaka Cooperative Society by Shs3.5b; Masaaba Cooperative Union by Shs5b; Bumwambu Cooperative Society Ltd by Shs6.7b; Masaka Cooperative Union by Shs7b and Bwavumpologoma Growers Cooperative Union Ltd by Shs2.75b.
The verification process, activities
The government of Uganda while taking into account losses suffered by cooperative unions during the time Uganda underwent a period of instability during the 1970s and 1980s; further taking into account its plans to revive Cooperatives through parliamentary budget appropriations allocated funds to compensate unions.
The Inter-Ministerial Committee
In a bid to expedite payments for war loss compensations to Cooperatives, Cabinet in 2016 constituted an Inter-Ministerial Committee herein referred to as the “Verification Committee” with the following terms of reference: (1) To analyse the documentary evidence concerning the War Loss Claims submitted to the Ministry of Trade, Industry and Cooperatives; (2) To hold meetings with Cooperative Union Officials and Community leaders to ascertain the various claims made by the Cooperative Unions; (3) To conduct field trips and carry out ground assessment exercises; and (4) To verify the validity of the claims made by the Cooperatives in respect of the losses incurred.
Others were (5) To scientifically come up with precise values of the losses suffered; factoring in the current cost of replacing the assets, property or stock lost, time value and loss of business associated with the destruction or loss; (6) To liaise with other responsible Ministries, Departments and Agencies (MDAs) in determining ownership, value and authenticity of the claims; (7) To guide and assist the Cooperatives in formulating strategic plans upon which funds will be utilised once compensated; (8)To come up with recommendations on the most appropriate compensation methods; and (9) To compile and submit a report with recommendations to the Permanent Secretary, Ministry of Trade, Industry and Cooperatives.
Verification Committee
The Verification Committee under the stewardship of the Ministry of Trade, Industry and Cooperatives (MTIC) comprised of the following staffs who were on secondment by accounting officers of their respective government institutions: Mr Leonard Kavundira, Principal Cooperative Officer, MTIC/Chairperson; Ms Clare Kukunda, State Attorney, Ministry of Justice and Constitutional Affairs (MJCA)/Alternate Chairperson; Mr Paul Ocatum, Senior Cooperative Officer, MTIC/Member; Dr Joseph Charles Aisu, Principal Veterinary Inspector, Ministry of Agriculture, Animal Industry and Fisheries/Member; and Mr Okot Kiwanuka, Economist, Ministry of Finance, Planning and Economic Development/Member.
Others were Mr Bill Kasigi, Government Valuer, Ministry of Lands, Housing and Urban Development/Member; Mr Santos Okello, Mechanical Engineer, Ministry of Works and Transport/ Member; Mr Duncan Sseninde, Senior Assistant Secretary, Ministry of Defense and Veteran Affairs/Member; Mr Geoffrey Walker Oyuu, Intelligence Officer, Internal Security Organisation (ISO)/Member; Maj Ian Katusiime, Staff Officer, Ministry of Defense and Veteran Affairs/CMI/Member; Mr Bashir Ssenyonga, Principal Internal Auditor, MTIC/Member; Mr Jacob Lumonya, Principal Executive Engineer, Ministry of Works and Transport/Member; Ms Scovia Tusubira, Training Officer, MTIC/Senior Administrative Assistant; Ms Lydia Namutamba, Personal Secretary, MTIC/Secretary; and Ms Rufina Komol, Cooperative Officer, MTIC/Secretary.
The verification activities
The verification committee was mandated to execute the following: (1) To analyse and study details of the claims; (2) To ascertain the value of the assets/property lost; (3) To evaluate the current position of the cooperative unions/societies in terms of structure and management; (4) To ascertain the exact number of the property, livestock destroyed and lost; (5) To discuss and determine the claimants a modest package for compensation; and (6) To seek evidence of the past disbursement of funds to the cooperative by the government as compensation.
Tasks
In order to achieve the above, the verification team embarked on the following tasks: (1) Analysed the extent of vandalisation, loss of assets and property; (2) Reviewed the historical information that gave an insight about the claims; (3) Assessed the extent of loss based on documentation provided, independent witnesses’ testimonies and claims by the claimants and make recommendations; and (4) Carried out any other stakeholders necessary in the execution of the tasks.
On September 21, 2023, while interfacing with the Committee on Touism, Trade and Industry, the Chairperson of the Veification Committee, Mr Leonard Kavundira; and Mr Robert Mpakibi informed Members that it was always the accounting officer, who selected when and which cooperative to verify. It was the Accounting Officer who would give schedules and approve facilitation for the Verification Committee.
The verification reports of each cooperative filed by the Committee would subsequently form the basis upon which to guide and inform the government on specific budget lines to allocate to different cooperatives.
Observation(s) of the Committee
The Committee on Tourism, Trade and Industry established that there were two verification committees, the first being an Inter-Ministerial Committee’ constituted by the Cabinet, and the second which was constituted by the Permanent Secretary, MTIC, Ms Geraldine Ssali. The Committee further established that although the Inter-Ministerial Committee did its work, it was rendered redundant by the establishment of a parallel verification committee.
