Majority shareholder destroyed UTL - MPs

KAMPALA.

A probe into the mismanagement of UTL has concluded, with five MPs signing a majority report, one a minority report and the other abstaining.

In the majority report, the Libyan majority shareholder was blamed for the company’s mismanagement while the minority said the recommendations by the majority report were weak and let several local officials off the hook.

The majority report was signed by chairperson Okin Ojara (IND, Chua West), Mr Micheal Tusiime (NRM, Mbarara Municipality), Ms Lillian Nakate (NRM, Luweero), Ms Paula Turyahikayo (NRM, Rubabo) and Mr Thomas Tayebwa (NRM, Ruhinda North).

On the other hand, the minority report was signed by Mr William Nzoghu (FDC, Busongora North) while Mr Paul Akamba (IND, Busiki) abstained.

The majority report “observed that government has never benefitted from its shares,” and blamed the majority shareholders for “mismanaging the company.”

Caution was sounded to government not to take over the management of UTL because of the Shs1.2 trillion that is required to bring it back on its feet, with Shs700 billion for clearing debts and Shs500 billion for recapitalisation.

“Suffice to state that by the time the matter of UTL was brought to the attention of Parliament, the company was heavily indebted to the tune of Shs700 billion,” the majority report noted.

In what sounded like a post-mortem report, the majority report noted that “UTL has not had strategic plans, operating without an approved Budget, the accounts have not been audited since 2014 and the board did not have a policy on remuneration,” part of the reasons they said led to its collapse.

Subscribers had also hit a record low, leading to sharp decline in revenue, a matter the majority report thus captured, “It is pathetic to note that UTL which was the second licensed national operator has a mere 2 million subscribers.”

Liabilities
Another observation was a Shs126 billion liability by ministries, departments and government agencies.
Uganda Revenue Authority has Shs88 billion, Uganda Communications Commission Shs27 billion and National Social Security Fund Shs10.6 billion.

UTL has uncollected debt from ministries, departments and agencies totalling to Shs12 billion, with Uganda Communications Commission, ICT Tetra sites, Uganda Revenue Authority, police, and State House among others topping the list. UTL also negotiated a bad deal with GEMTEL, a South Sudan telecommunications company, but failed to attach a commercial value to the agreement. It later emerged that the owner of GEMTEL has 69 per cent shares in UTL; a conflict of interest the MPs said should not go uninvestigated.

United Nations sanctions
The Committee was told by several officials that the majority shareholder did not downstream funds to the tune of Shs87 billion due to UN sanctions at the height of the political crisis in Libya.

The witnesses who made the claims included Finance minister Matia Kasaija, UTL chairman Stephen Kaboyo, director privatization unit in the Ministry of Finance Moses Mwase, and former acting managing director Donald Nyakairu.
However, the Libyan Ambassador to Uganda provided the Committee with evidence to the effect that money was remitted anyway, notwithstanding the sanctions.

Mr Nzoghu, in his minority report, wants former UTL Board members Ben Mbonye, Christopher Mugisha and Donald Nyakairu probed by the Auditor General over the Shs87 billion shillings down-streamed during the period of the UN sanctions.
Speaker Kadaga last Thursday told MPs that the two reports will be debated at a date yet to be appointed, before the House adjourned close to 9pm.