NSSF was not forced to purchase Umeme shares, says ex-minister

Wednesday October 1 2014

Former Finance minister Gerald Ssendawula

Former Finance minister Gerald Ssendawula before the Select Committee investigating suspected nepotism and corruption at NSSF at Parliament on Tuesday. PHOTO BY GEOFFREY SSERUYANGE 

By Yasiin Mugerwa

Former Finance Minister Gerald Ssendawula has said the National Social Security Fund (NSSF) was not forced to purchase Umeme shares and denied having a hand in the disputed Shs70 billion deal.

Weeks ago, testifying under oath before an ongoing House inquiry into the Fund, Umeme’s company secretary Noah Edwin Mwesigwa said the insertion of NSSF in Umeme’s Articles and Memorandum of Association 10 years ago, originated from negotiations the power company had with the then Finance minister and other officials at the Privatisation Unit, including Mr Emmanuel Nyirikindi, Mr Michael Opagi and Mr David Ssebabi.

Mr Ssendawula, a board member and one of the directors of Umeme Ltd, however, said yesterday the inclusion of a commitment of NSSF’s future purchase of Umeme’s shares in the company’s Articles and Memorandum of Association was a Cabinet decision and, therefore, he cannot be held responsible.
“The Support Agreement I signed with Umeme belongs to government; it does not belong to Ssendawula. The government decided this and all these agreements were cleared in Cabinet,” Mr Ssendawula said.

He added: “The main custodian of the NSSF money is government and that’s why you’re asking whether Minister of Finance gave clearance to the purchase and the government is responsible for appointing a Fund manager.”
The former minister appeared before only one member of the Select Committee investigating suspected nepotism and corruption at NSSF, Mr Alex Ruhunda (Fort Portal Municipality). The committee has five members; its quorum is realised when three members are in attendance.

The other members: Mr Vincent Ssempijja, Mr Joseph Ssewungu, Mr Ann Maria Nankabirwa and Ms Theopista Ssentongo were absent. Mr Ssewungu appeared briefly and went to another committee, the Public Accounts Committee.
Mr Ssendawula said NSSF invested in the right company and that the price for Umeme shares has since gone up from Shs275 to more than Shs500, observing that this investment made business sense.

He said in 2012 “NSSF managers decided to buy shares from Umeme on their own and I don’t know how they decided to do this. I was long gone as finance minister. I gave up in 2005”.
Mr Ssendawula said: “Another issue making the rounds, which is embarrassing, is that I had an interest because I sit on the Umeme board, which is not true. When you tell me that I should not work because I was a former minister, then you have to pay me. I have heard rumours going around that I am a director in Umeme yet I signed the Support Agreement on behalf of government and had no vested interest.”
He said the Support Agreement that mandated Umeme to sell ordinary shares to NSSF or its employee never forced NSSF to buy the shares.

Explaining how he came to be a board member of Umeme, Mr Ssendawula said: “Umeme started work in 2004 and in 2006 they started their board and they appointed the late James Mulwana and Mr Patrick Bitature. When Mulwana passed away, they approached me and they asked me if I can accept to replace the late Mulwana and I accepted. In August last year they appointed me a director and the shareholders approved my name.”
Umeme has denied suggestions that it tapped the NSSF as a source of capital.