Norway, Sweden cut aid, Bigirimana stays

Tuesday November 6 2012


Norway and Sweden yesterday joined Ireland, the UK and Denmark in withholding billions in foreign aid to Uganda over the massive funds theft scandal that has rocked the Office of the Prime Minister.

At the same time, the government came under fresh pressure from anti-corruption watchdogs to explain why under-fire OPM permanent secretary Pius Bigirimana remains in office in spite of a House resolution passed last week to compel the government to have him suspended.

Commenting on the Auditor General’s findings, which highlighted the loss of billions of shillings meant for post-war recovery efforts in northern Uganda and Karamoja sub-region, the Norwegian Minister of International Development Heikki Holmås said: “This amounts to no less than stealing from the impoverished people of northern Uganda who have been subjected to conflict and misrule for years.” “We have a policy of zero tolerance for corruption and other misuse of funds, and we intend to get to the bottom of this,” Mr Holmås said.

The deputy head of the Norwegian Embassy in Kampala, Mr Morten Svelle, later told the Daily Monitor that due to the OPM scandal, Norway has decided to suspend disbursements of all funds to Ugandan institutions until further notice. “Norway is aligned with the actions taken by the affected donors and takes active part in all follow-up activities,” Mr Svelle said.

The Swedish government through its development agency, Sida, also announced it had stopped all funding to the Uganda “awaiting further clarity.” Uganda receives about $50 million (about Shs130b) in development aid from Sweden.

Sweden and Norway have been funding key initiatives in health care, democratic governance, including peace and security, private sector development schemes, research, water and sanitation and energy.


A special audit by the Auditor General found substantial evidence detailing how aid from Ireland, Norway, Sweden and Denmark was transferred to unauthorised accounts in a sophisticated scam which resulted in the theft of at least Shs50 billion.

Over the past few years, several donor nations including the UK, Norway, Sweden, Ireland and Denmark, have provided in excess of Shs70 billion for reconstruction efforts in northern Uganda.

Norway alone is reported to have provided NOK60 million (Shs30b). The report published by the Office of the Auditor General details widespread irregularities and fraud involving some NOK75 million (Shs33.6b). Of this, NOK27 million (Shs12.1b) of the funding provided by Norway has been misused.

News of the further aid suspension to a tune of Shs30 billion came on the day the Anti-Corruption Coalition Uganda accused the government of “impunity” in light of Mr Bigirimana’s continued stay in office.

Parliament last week ordered the government to interdict Mr Bigirimana immediately.
“His [Bigirimana] continued stay in office even with all the evidence in the AG’s report and a key resolution of Parliament is a sign of impunity of the highest order,” the head of Anti-Corruption Coalition Uganda, Ms Cissy Kagaba, said.

Taking action
But as more donors froze aid to Uganda, Prime Minister Amama Mbabazi said in a press statement that the government had decided to pay back the stolen funds to the Peace, Recovery and Development Project (PRDP) donor account.

Mr Mbabazi’s announcement drew almost immediate condemnation from Parliament’s Public Accounts Committee, whose members have rejected the idea. PAC warned of audit queries if government diverts taxpayers money to pay for people they called “thieves” in OPM.

Mr Mbabazi said the money for refund would be sourced from elsewhere but when convicted in courts of law the suspects would be punished and made to refund it. At least 17 officials from OPM, Bank of Uganda and Ministry of Finance have already been interdicted over the fraud as investigations continue.

Responding to the Daily Mail story which indicated that he received donor funds on his private account, Mr Mbabazi said he had instructed his lawyers to study the issue and advise him on the possible remedy available. “It is ridiculous, a wild figment of someone’s imagination to suggest that I took money then called for the investigations,” he said.