Government loses Shs107.8b in inflated Internet deal
Mr Godfrey Kibuuka (L) with the ministry PS Patrick Samanya before PAC committee. PHOTO BY Geoffrey Sseruyange
What you need to know:
The money was allegedly lost when technocrats approved costs by the Chinese firm without ascertaining their fairness in terms of prices.
Taxpayers have lost $41.8 million (more than Shs107.8billion) in an internet deal awarded to a Chinese company without competitive bidding.
Public Accounts Committee investigating the scam found that corruption and negligence on the part of the technical people bungled the $106.5 million (about Shs274b) National Data Transmission Backbone Infrastructure Project meant to promote e-governance in the country.
PAC yesterday opened investigations into the allegations of corruption in the deal. “The technocrats let down the taxpayers and approved the inflated costs from the Chinese firm,” Mr Wadri said. “Those who facilitated this fraud are going to pay back the taxpayer money.”
Although the deal was awarded to Huawei in June 2006, the latest forensic investigation by the Auditor General (dated July 2013) has found that the contract price was inflated by more than Shs107.8 billion.
“The government did not review the bills of quantities submitted by Huawei in order to ascertain the fairness of the unit prices prior to signing the contract to ensure that the [deal] is not over-costed,” the Audit report reads in part.
The Daily Monitor investigation has also revealed that the Task force set by ICT ministry did not conduct a market comparison of the prices, instead they carried out a feasibility study and simply rubber stumped the proposal from Huawei.
Chogm ghosts return
The officials named President Museveni in the deal, former ICT Minister, Dr Ham Muliira and Mr Wadri named Prime Minister Amama Mbabazi in the Chogm security equipment deal.
The PS said he was not involved in the project from the start and named Mr Godfrey Kibuuka, the director communications as the man who was involved in the deal. In defending Huawei, Mr Kibuuka said, their prices were fair and that the PPDA approved “everything” because the project had a Chogm component.
