MPs probe $5.5m Museveni war pay to Burundi

President Museveni ordered senior officials in the Ministry of Finance to pay more than $14.2 million (about Shs35.5 billion) to Burundi, MPs heard yesterday. The claims are now a subject of investigation by Parliament’s Public Accounts Committee (PAC).

The acting Secretary to the Treasury, Mr Keith Muhakanizi, told PAC that Burundi supplied material to President Museveni’s National Resistance Army rebels during the bush war (1981-1986) and after the liberation war; the support was converted into a national debt.

However, PAC Chairman Kassiano Wadri said: “Money given to Museveni’s rebels fighting in bush was a private matter and they did not have any legal mandate to commit the country. If these NRA rebels had been captured by the government in power then, they were going to be charged with treason.”

It has also emerged that while under a debt relief agreement signed between the two countries, Burundi had cancelled interest of $5,504,302 (about Shs13.7 billion), President Museveni through unclear circumstances ordered Ministry of Finance to pay the interest on account that Burundi was a poor country.

The directive
In one of his letters on the matter, the President on March 2, 2009, told then Attorney General Khiddu Makubuya and Finance Minister Syda Bbumba to assist Burundi, saying: “Burundi is a poor country which is recovering from war and therefore, cannot be considered to be like rich nations to which we owe debts. I am therefore, of the opinion that where we can, we should support them. The agreement notwithstanding, can we pay this amount of $5.5m as an ex-gratia to the people of Burundi?”

Mr Muhakanizi told PAC that President Museveni and his Burundian counterpart met in Addis Ababa, Ethiopia, where the two leaders agreed that $5.5 million that had been waived be reinstated and donated to the people of Burundi as ex-gratia.

“I am a born-again Christian I don’t tell lies I have always been truthful,” Mr Muhakanizi said. “The President asked us not to treat Burundi as a rich country. We had refused to pay because the interest had been cancelled. But the President sought for legal advice from the Attorney General who cleared the payment. There is no way I would have paid if the Attorney General had not cleared this payment.”

Communication from the Finance Minister of the Republic of Burundi tabled in PAC indicates that the money was allegedly paid to Burundi through a local company, Ms Picfare Ltd whose ownership is being sought by the committee. The money was paid on a dollar account number 02501007274 with Bank of Baroda in return for the equivalent of scholastic materials supplied.

Forgery cited
But Mr Wadri said his investigation with URA has revealed that out of Shs35.5 billion only Shs1.2 billion left the country. “This money is in Uganda,” Mr Wadri said. “Some of the documents from Picfare Industries appear forged and the company did not have power of attorney to receive money on behalf of Burundi government. This is another case of abuse of public funds and we are going to summon all the ministers who were involved and we shall meet the President who authorised this illegal expenditure.”

Mr Muhakanizi and Account General Gustavio Bwoch also tabled letters from Ministers Syda Bbumba (Gender) Sam Kutesa (Foreign Affairs), Fred Omach (Finance General Duties) and former Attorney General Khiddu Makubuya who offered a legal opinion clearing the deal.

Mr Kutesa, who has since stepped aside over a Chogm case, wrote to the then Finance Minister Ezra Suruma reminding him to pay Burundi since they had assisted NRM at a critical time in 1985. In his legal opinion dated February 24 2010, Prof Makubuya said: “I have considered the matter carefully and concluded those…Principles of Pan Africanism and the sense of African solidarity may be called into play to treat Burundi as a special case. There is no legal bar to this consideration. Therefore it’s my considered opinion that Uganda may lawfully pay $5.5 million as ex-gratia payments to the government of Burundi.” PAC asked CID to investigate allegations of forgery in the deal.

The committee heard that Shs35.5 billion was paid without parliamentary approval and the mandatory Auditor General’s warrant. Mr Muhakanizi, Mr Bwoch and other officials from Ministry of Finance return to PAC today with all the original documents relating to the deal.

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