Govt fails to account for Shs56 billion Covid-19 cash 

What you need to know:

  • The AG report does not include an audit into the Shs10b that was appropriated by Parliament and shared by MPs, each getting Shs20m purportedly to help them support their electorates during the lockdown last year.
  • After extended disagreements between Parliament and President Museveni, the benefitting MPs were directed to return the money to the Consolidated Fund account in Bank of Uganda or hand it over to their respective Covid-19 district task forces.

The Auditor General (AG) has unearthed gross abuse of billions of shillings and other donations meant for the Covid-19 response when the country was battling the effects of the pandemic early last year.

The summary of the report for 2019/2020 audit, which the AG, Mr John Muwanga, presented to the Speaker of Parliament Rebecca Kadaga yesterday, shows that government Ministries, Departments and Agencies (MDAs) and districts received Shs345.6b for Covid-19 response during the financial year. Of this amount, Shs284b was by supplementary budget; Shs27b from the contingency fund; Shs11.6b from cash donations by individuals and companies and donated material items worth Shs23b. 

The AG’s main report, which Daily Monitor has seen indicates that of the Shs27b from the contingency fund, Shs25b was sent to the Ministry of Health, Shs2b to Office of the Prime Minister (OPM) and Shs233m to the Uganda Embassy in Beijing, China, to support Ugandan students who were stranded during the lockdown. 

The main report, which is not yet public, reveals that OPM officials claimed to have distributed Covid-19 relief items worth Shs55.8b last year but could not produce receipts or other supporting documents to prove that they were delivered to the recipients. This money remains unaccounted for.
“Items valued at Shs55.8b (that) were distributed under the Office of the Prime Minister lacked sufficient evidence of acknowledgment to enable me verify the recipients,” Mr Muwanga states in the report.

The OPM has been coordinating the Covid-19 response budget and activities. The Covid-19 National Task Force chaired by the Prime Minister, Dr Ruhakana Rugunda, also received material and cash donations from different private and international entities, and individuals. The OPM procured and oversaw distribution of the items such as food and other supplies to vulnerable communities.

In the report whose summary was presented to Parliament, the AG revealed that Shs10.574b was diverted by five government entities which spent it on items other than those for which the money was released. He also cited Shs6.68b which was not utilised by four government entities. 
Mr Muwanga attributed this to lack of preparedness by the receiving government agencies. 
“I advised the government to initiate measures to raise preparedness for management of emergency situations,” the AG noted.

The AG further discovered that OPM officials procured rotten maize and beans which the Uganda National Bureau of Standards found unsuitable for human consumption after carrying out quality tests.
Quality checks were carried out on a sample of 14,069 tonnes of maize flour of which 2,615 tonnes that was intended for distribution to people, failed the test while 2,017 tonnes of the 8,547 tonnes of dry beans tested were rotten.

The report reveals that the procurements worth Shs143.8b were carried out by 25 entities without complying with the laid down procedures. 
The report further indicates that some of the queried procurements had anomalies that include direct procurement, no signed contracts, late delivery of goods, payments before receiving supplies, and failure to involve the contracts committees.

The AG indicates that 149 out of 151 entities that benefited from the Covid-19 funds had work plans for their intervention programmes and Shs1.317b was disbursed to 17 entities, which had not filed accountability by the time of audit.
While receiving the report, Speaker Kadaga commended the Office of the Auditor General for continuing to execute its mandate despite low staffing levels and the challenges posed by the Covid-19 pandemic. 

The AG report does not include an audit into the Shs10b that was appropriated by Parliament and shared by MPs, each getting Shs20m purportedly to help them support their electorates during the lockdown last year. 
After extended disagreements between Parliament and President Museveni, the benefiting MPs were directed to return the money to the Consolidated Fund account in Bank of Uganda or hand it over to their respective Covid-19 district task forces. 

Mr Keith Muhakanizi, the Permanent Secretary of the Ministry of Finance and Secretary to the Treasury, later directed district chief administrative officers to receive the returned money from the District Task Forces and bank it on the Consolidated Fund account. He said the money can only be spent after being re-appropriated by Parliament through a supplementary budget. 

The Auditor General also told Parliament yesterday that he carried out a separate audit into this expenditure and has already issued a report. He did not reveal details of the audit. 
He also said another report of audit into Shs7.46b that was spent under classified expenditure, which was part of the supplementary budget and Shs233m off the Contingency Fund that was sent to Uganda’s Embassy in China, will be issued later. 


Other Auditor General queries
 •Why government submitted a supplementary request to increase the 2019/2020 National Budget from Shs40.5 trillion to Shs42.74 trillion when it could only release Shs37 trillion. 
 • Failure to absorb loans worth Shs1.373 trillion which expired before being disbursed with the energy sector being the most affected. 
Failure by Ministry of Finance to release Shs680b to fund operationalisation of 356 new town councils.
•   Out of Shs93.3b disbursed to Youth Livelihood Programme since its inception, only Shs37.04b (40 per cent) has been recovered. 
• Failure by 11 local governments to pay pension and gratuity arrears worth Shs5.8b to claimants.
•Shs2.8b stolen via fraudulent transactions on payroll. 

Prosecute thieves of Covid cash - report

In December Last year, the anti-corruption agencies, Uganda Debt Network (UDN), Anti-Corruption Coalition Uganda, Action Aid, and Transparency International Uganda noted that several decisions taken before deployment of the Covid-19 resources were not well thought out and justified. 
In an independent assessment report, they indicated that items ordered were not delivered on time, and prices of many items were inflated, besides procurement of substandard items. 

For example, the sleeper tents procured for the National Quarantine Centre at Namboole stadium were blown away by wind and could not be utilised by end of August, despite the rising numbers of Covid-19 infections.
 The anti-corruption crusaders said government had not provided any accountability regarding the utilisation and impact, if any, of the Covid-19 resources to enable citizens follow up and report cases of misuse as and when they arise.

They called upon government to take action against those who misused the funds.

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