Govt to use taxpayers’ money to refund OPM cash

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By Mercy Nalugo & Yasiin Mugerwa

Posted  Thursday, December 13   2012 at  02:00

In Summary

The Cabinet decision follows aid cuts that has seen government admit that it is in a cash fix.


Cabinet yesterday agreed to use taxpayers’ money to pay back billions of shillings stolen in the Office of the Prime Minister. Sources who attended the meeting said Shs38.8 billion would be withdrawn from the Consolidated Fund and refunded to development partners.

While the ministers resolved to refund the stolen donor funds on behalf of thieving government officials, it is not clear who is going to refund the money lost in the scam.

This month, the European Union ambassador to Uganda, announced that the EU, United Kingdom, the World Bank, Austria and other development partners had suspended up to $300m (about Shs806.3b) promised in budget support.

The Cabinet decision comes after the junior Finance Minister, Mr Fred Omach, told a committee of Parliament last month that after key donors froze aid, the government was grappling with cash flow problems.

But before a decision was taken in yesterday’s meeting, ministers who requested not to be named in order to speak freely, said their colleagues warned that the decision would boomerang on the government and begged Prime Minister Amama Mbabazi and Vice President Edward Ssekandi “not to send them to the graves” by approving a controversial proposal by the President.

However, after Mr Mbabazi told ministers that President Museveni sanctioned the decision before traveling to Russia, they demanded that he explains their relevance in debating a matter that had already been decided.

Finance Minister Maria Kiwanuka told Cabinet that the donors had put stringent conditions on government to refund their money before they reinstate funding. Ms Kiwanuka was unavailable for comment.

In the meeting, some ministers had demanded that the government sells off assets of those implicated instead of using taxpayers’ money. According to sources, Mr Mbabazi and Ssekandi reportedly told infuriated ministers that the decision was a stopgap measure.

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