Amama Mbabazi's submission to MPs

Mr. Chairman, after tracking then Principal Accountant for a while and strongly suspecting him of financial indiscretion

A: INTRODUCTION.
Mr. Chairman, first of all, I would like to thank you for inviting me to appear before the Public Accounts Committee. Through you, Mr. Chairman, I wish to also thank the Members of this Committee for their consistent efforts to ensure timely and full accountability for funds managed by the government under the various programs. Your oversight role is important and ensures that there is value for money and delivery of essential services in Uganda.

About the OPM, Mr. Chairman, I would like to be on the record here and categorically state that the recent loss of funds under my Office is regrettable. Inevitably, OPM has been under the spotlight for a while. In some sections of the media, we have also been portrayed as irresponsible for specifically causing loss of funds from our development partners. About this, i wish to also put it on record that the funds lost at OPM included those from the government as well. This, like I have noted, is regrettable indeed.

The other issue that I request the Committee to note, Mr. Chairman is that the initial detection of this financial loss was from within OPM.

Mr. Chairman, after tracking then Principal Accountant for a while and strongly suspecting him of financial indiscretion, the Accounting Officer sought my advice, a no objection, and proceeded to engage the police and the Auditor-General.

While some police inquiries are still under-way, the Auditor-General issued an in-depth report highlighting various illicit financial transactions which this Committee has been reviewing for a while. Indeed, Mr. Chairman, it is for this reason that I would commend and consider the Accounting Officer as a whistle-blow in this saga.

I have noted for a while people claiming that most lost funds at OPM were from the PRDP program.

Allow me therefore, Mr. Chairman, to briefly state that 98% of the funds for PRDP go directly to districts to implement recovery programs. The OPM receives just 2% of the PRDP resources for coordination, monitoring and evaluation of the said programs. This is the same arrangement under which NUSAF is implemented. I am informed Mr. Chairman that the Accounting Officer earlier availed you with the financing details for these programs.

B: THE FINANCIAL FRAUD AT OPM.
Mr. Chairman, I have taken keen interest in the famous financial fraud at OPM since it came to the fore. The corroborated information I have to-date is that it involved individuals under my office (unfortunately), notably those from the Accounts Unit. For that matter, Mr. Chairman, the OPM’s interdicted former Principal Accountant, Mr. Geoffrey Kazinda is currently before the Anti-Corruption Court for various charges related with the fraud.

However, Mr. Chairman, the said fraud we have now learnt, was executed in a syndicated manner. Through this under-cover collusion, errant individuals from OPM were operating in sync with elements from the Ministry of Finance (Treasury) and Bank of Uganda to occasion the loss now under review. In fact, under the expanded investigations going on, it is emerging that similarly orchestrated fraud may have affected other Ministries.

Through the network I have talked about, Mr. Chairman, individuals in the Treasury, notably one Chris Lubega, assigned the responsibilities of the Accounting Officer, OPM, to then Principal Accountant, Mr. Geoffrey Kazinda.

Having been “empowered” by the Treasury individuals, the Principal Accountant then proceeded to pay whoever he wanted, including individuals and companies as well as withdrawing large sums of money.

Indeed, Mr. Chairman, investigations and further verification by hand-writing experts have now established that the Principal Accountant accessed funds using forged bank security papers and cash withdraw forms.

It is also becoming clearer, Mr. Chairman that Individuals at Bank of Uganda also connived with then Principal Accountant by honouring the presented Bank Statements without cross checking with the Accounting Officer, as required. These are some of the salient issues captured in the forensic audit report issued by the Auditor-General.

Earlier, the Accounting Officer also appeared before this Committee and made a related submission with a component of financial accountability. Mr. Chairman, I remain strongly in support of the secondary investigations still underway and have all the faith that the other individuals involved in the OPM scam shall appear before courts of law very soon.

C: MR. KAZINDA’S TRANSFER.
Mr. Chairman, while I wasn’t opposed to the transfer of Mr. Kazinda per se, I also took interest in the approach and method under which he was being was been transferred. It is true that the Accounting Officer brought to my attention the transfer of Mr. Kazinda and told me it was a normal re-deployment. However, considering that there were on-going critical issues, for instance compiling responses to audit queries and finalising the policy statement at such a large Ministry, I felt we needed to be mindful before summarily transferring the officer, at a short notice.
I, therefore, convened a meeting at which I sought to know more about the manner in which the officer was being transferred. Mr. Chairman, I also felt that if there were any serious issues of misconduct, we could not address them by simply transferring him. Since such a transfer would amount to shifting a “problem” to another Ministry, I was of the view that it would be more helpful to government if the officer was culpable to be disciplined and where applicable prosecuted. During the said meeting, I inquired from the Accountant General if the officer had got involved in misconduct and I was advised that he hadn’t. I then recommended that the transfer be effected, but in the normal and less hasty manner, after completing the important on-going assignments.