City traders want government to act on spiralling rent problem

Street vendors take a rest amid their merchandise on Wilson Street close to Arua park in Kampala last week. The shops also remained closed at Superior Complex Arcade. PHOTO BY ALEX ESAGALA

What you need to know:

  • In a telephone interview last week, the Chairperson of the parliamentary Committee on Trade, Industry and Cooperatives, Mr John Bosco Lubyayi (Mawokota South), said they have submitted a report to Parliament over the same so as to safeguard traders from being mistreated by landlords.
  • During a crisis meeting with the traders on Premier Complex Arcade two weeks ago, Kampala Lord Mayor, Erias Lukwago promised to champion the war on rent hiking.

Kampala. The better part of last week saw majority of shops on Superior Complex Arcade located on Ben Kiwanuka Street, remain closed following a traders’ protest against increased rent by the landlord, Mr John Bosco Muwonge.
The spokesperson of the Kampala Arcades Traders Association (Kata), Mr Henry Mpungu, told Daily Monitor last week that traders could not re-open their shops without a written agreement from the landlord, indicating a halt in the increment of rental fees.

“Following the protest on Monday, the Central Police Station DPC told us that the landlord had agreed to put a hold on his intended plans to increase rent. However, traders have refused to open their shops until they receive official communication which is in black and white,” Mr Mpungu said last week.
The protest, which left one person dead and five others injured, was triggered by Mr Muwonge’s doubling of the current rental fees without serving them with a notice of the intended increment.
This comes barely two weeks after other traders operating from Premier Complex on Allen Road, protested against doubled rental fees and paying in dollars.

The traders’ plight has stirred a heated debate, with majority of people criticising government for failing to shield the affected traders from the “greedy” landlords.
The Undersecretary in the ministry of Kampala Affairs, Ms Samuel Baker Emiku, last week described the situation as “a time bomb” to the informal sector, saying the continued demonstrations against increased rent not only affects businesses but also poses a security threat.
He, however, noted that the limping economy could have forced city landlords to hike rental fees, adding that “We intend to engage the Ministry of Finance to find means of handling such an economic problem.”

The charges
Mr Mpugu told Daily Monitor that rent on city arcades vary according to location.
He said a 12 by 12 feet shop, the size that is common among most arcades, is charged between Shs6m and Shs7m monthly, if the shop is on the ground floor and on a busy road or in the city centre.
For the second, third and fourth floor, shops go for Shs4m, Shs3m and Shs2m respectively.
However, he explained that rental charges on arcades located on roads that are not so busy, goes for Shs4m per shop on the first floor and Shs3m and Shs2m on the second and third floors respectively.
Additionally, traders are required to pay electricity, water and garbage collection bills, charges they say, leave them debt-saddled yet they borrow money from banks with high interest rates.

Subletting
Mr Samuel Mubiru, a city trader, said when landlords rent out a shop, the tenant sublets it to different tenants, charging them differently so that they could also get a little profit.
“That’s why you see the rent increasing because there are many middlemen in the rent business on arcades. Everybody charges what they like because there is no clear regulation to check such irregular ways,” he said.
Mr Mpungu said they intend to petition Parliament to intervene before the situation goes out of hands.

Regulation
The Rent Restriction Act was enacted in 1949 to consolidate the law relating to the control of rents of dwelling houses and business premises.
According to Section 2(1) of the Act, no owner or lessee of a dwelling house or premises shall let or sublet that dwelling house or premises at a rent which exceeds the standard rent.
In a telephone interview last week, the Chairperson of the parliamentary Committee on Trade, Industry and Cooperatives, Mr John Bosco Lubyayi (Mawokota South), said they have submitted a report to Parliament over the same so as to safeguard traders from being mistreated by landlords.
“The most painful thing is that the landlords nowadays charge rent in dollars yet in Uganda, it’s the Shilling that is used in transactions. With this struggling economy, forcing a trader to pay rent in dollars would see majority of them kicked out of their businesses. We want the Rent Restriction Act implemented so that these traders are protected,” he said.

However, Mr Lubyayi attributed the increase of rental fees to foreigners, who he alleged, pay any amount of money to the landlords because they want to deal in retail business and kick out local traders since they can’t pay exorbitant rental fees.
He added: “In our report, we also recommended that all foreigners must get out of the retail business because they are supposed to be investors”.
During a crisis meeting with the traders on Premier Complex Arcade two weeks ago, Kampala Lord Mayor, Erias Lukwago promised to champion the war on rent hiking.