Inside the fights that brought down UIA boss

Left to right: Tian Tang Group deputy general manager Andy Lian, group chairman Paul Zhang, State Minister for Works Katumba Wamala and interdicted Uganda Investment Authority executive director Jolly Kamugira Kaguhangire share a light moment after a meeting in Kampala in September 2017. Monitor photo

Kampala- At about 9:20pm last Thursday, the suspended Uganda Investment Authority (UIA) executive director, Ms Jolly Kamugira Kaguhangire, finally vacated office as instructed by the board two days earlier pending investigations into alleged corruption, abuse of office and insubordination.

The UIA is the statutory body charged with investment promotion and facilitation.

That night, according to three sources familiar with the matter, Ms Kaguhangire communicated to the board chairman, Mr Emely Kugonza, that she had withdrawn her earlier defiance to leave office. The two agreed on a handover the following day at 3pm.

Ms Kaguhangire also requested not to be booted out in an embarrassing manner but rather be allowed to “say a word” to the staff who would be present as the new interim boss, Mr Basil Ajer, took charge.
After suspension on Tuesday, Ms Kaguhangire had written back to the board on Wednesday, saying she would remain in office as the executive director carrying out her duties. She argued that the board’s resolution to suspend her was incurably null.

Sources, however, also intimated that Ms Kaguhangire’s decision to step down was informed by a tip-off that some board members were seeking to have her forced out of office using police if she remained defiant.

Prior to accepting to vacate office, Ms Kaguhangire had had several back-to-back telephone conversations with her line supervisors who included the State minister for Investment and Privatisation, Ms Evelyn Anite, and Finance minister Matia Kasaija. Details of their conversations could not be readily established.

Journalists were tipped about the Friday handover and they were at the venue in time.
However, 30 minutes to the time, Ms Kaguhangire’s office on Second Floor at Twed Plaza on Lumumba Avenue remained closed and had to be forced open. Ms Kaguhangire did not show up.

Inside the fights
According to sources and documents, including intelligence briefs seen by Daily Monitor, last week’s events were a culmination of a long-running feud between Ms Kaguhangire, the UIA board and the Ministry of Finance.

Also at heart of matter, besides issues the board raised in Ms Kaguhangire’s interdiction letter, is the decay in UIA.
The decay, sources said, included corruption, UIA officials parcelling out land in industrial parks and issuing licences to quack investors.

One intelligence brief and a UIA internal audit report seen by this newspaper indicates that at least 450 acres cannot be accounted for out of the 15,000 acres gazetted for the Kampala Industrial and Business Park commonly known as Namanve Industrial Park.

The park, about 11km from the city centre on Jinja highway, was gazetted by an Act of Parliament in 1997.
The two reports also indicate that several private individuals own land in the industrial park and are demanding billions of shillings to relinquish their interest. Several other ‘ghost’ investors own land in the park.

At the Mbale Industrial Park that President Museveni commissioned in March, at least 10 acres are unaccounted for.
The government, through UIA, in 2008 acquired 619 acres of land from Bugisu Corporative Union to develop a modern industrial park in the area.

There is also some 5.3 acres unaccounted for out of the 150 acres UIA acquired in Kasese District to establish an agricultural park.

At the time of interdiction, Ms Kaguhangire had just launched an audit into management of UIA land and other property, and also submitted to the board a proposal for withdrawal of both land and licences from some 1,000 “ghost” investors in the system.

Reports indicate that the missing 450 acres in Namanve land was only discovered months ago after one of the directors was removed from office pending investigations after his associates were caught excavating and ferrying murram [excavated soil] and sand from construction sites within the park.

During the board meeting last Tuesday at Twed Plaza, Mr Kugonza discussed 11 issues that culminated in Ms Kaguhangire’s three-month suspension.

After intense discussions, Ms Kaguhangire, who was the board secretary, was asked to leave the boardroom at about 2pm to allow the members discuss her fate freely.

Once she was out, the charges were brought against her. They included recruitment of executive assistants, appointment of eight investment executives, sending away staff on probation on training, paying her personal assistant (who holds a diploma) as a senior investment executive, using four cars, three drivers, her husband using UIA’s space for his work and at times driving company cars and attending a meeting in Russia at the organisation’s expense.

After deliberations at about 3pm, the board recalled Ms Kaguhangire into the boardroom and handed her the interdiction letter.

Later that evening, the board chairman notified Bank of Uganda and ministry of Finance that Ms Kaguhangire had been stripped of powers to transact on behalf of the UIA.

She is a former assistant commissioner and head of service management at Uganda Revenue Authority.
When contacted for a comment on the issues, she asked to be left alone.

The long running battle
Ms Kaguhangire was appointed UIA boss in April last year after a heated internal row on recruitment, replacing Dr Frank Sebbowa who chose not seek contract renewal.

According to documents, the board indicated they wanted her to turn around UIA.
The board indicated they had a restructuring plan but neither had money nor leadership to execute the plan previously.
With the board’s approval, Shs100m was set aside and a local firm Summit Consulting was hired to advise on the reorganisation of UIA.

In June 2017, Summit Consulting presented a preliminary report which highlighted several gaps in the current UIA structure and offered recommendations including restructuring the staff.

Sources said some staff upon getting wind of the restructuring petitioned Ms Anite who later in July advised on how the process should be handled.

However, an internal uproar ensued and Summit Consulting pulled out, citing the hostile environment, including from some board members.

As the dust settled, another row erupted in July between Ms Kaguhangire and Ms Anite over the One Stop Centre, the government’s proposed first point of contact for any investor and allows access and application of the various licences under one roof.

The centre was to converge units of Kampala Capital City Authority, National Environment Management Authority, Uganda Revenue Authority, Uganda Registration Services Bureau (URSB) and UIA through an integrated system.

Sources said Ms Anite wanted URSB to take charge of the centre and government had hired a Norwegian consultant at about Shs2b to advise on its set-up.

At one meeting convened by Mr Kasaija in July to resolve the impasse, tempers flared and a resolution on the matter stalled until President Museveni called another meeting at State House. At the meeting, Mr Museveni directed that UIA takes charge of the centre.

On July 25, he wrote to Mr Kasaija, directing him that UIA takes charge of the centre. Sources revealed that the entire Finance ministry preferred URSB to manage the centre.

“Battle lines were drawn,” one ministry of Finance official recounted.

Ms Kaguhangire and the board were on one side supporting UIA takeover.
In August last year, the board rekindled its restructuring plan. The board approved the plan but directed Ms Kaguhangire to fire her two aides; one executive assistant and another personal assistant on account that they did not fit in the new structure.

The board said in the alternative, she should readvertise their positions.
She did not comply, culminating in bad relations with the board and last week’s suspension.
However, at that time, Ms Anite reined over and said no changes should effected within the next four months.
At its subsequent meeting the board made a U-turn on the restructuring exercise. Ms Kaguhangire, however, insisted it was key to the “new path UIA sought”.

Sources said Ms Anite and Ms Kaguhangire made peace in November. In January this year, Ms Anite approved the UIA restructuring exercise.

In an interview with Daily Monitor at the weekend, Ms Anite admitted the two had a rough start “but reconcilled and moved on for the good of the country”.

She, however, distanced herself from Ms Kaguhangire’s suspension, saying the board did not consult her.
“I am not interested in petty squabbles,” Ms Anite said.

The minister said in May when allegations against Ms Kaguhangire first came up, she wrote to the board asking them to handle the issue harmoniously.

Tipping point
The tipping point to last week’s events started in April when, following approval of the restructuring, Ms Kaguhangire notified all UIA’s six directors and deputies that their contracts would run out on June 30.
The 12 were told, if interested, to reapply as part of the new plan.

The directors include; Mr Richard Tibandeke (finance), Ms Sheila Mugyenzi (investment promotions), Mr Lawrence Byensi (investor facilitation), Mr Hamza Galiwango (lands development), Mr Basir Ajer (Small and Medium Enterprises) and Joseph Kiggundu (in charge of One Stop Centre).

The deputies are: Ms Stella Kanyike (communications), Ms Florence Kafuko (human resource), Barbara Kabuchu (finance) and Mr Godfrey Ssemakula (lands development).

According to documents seen, only two out of six deputy directors were returned in the restructuring early last month. Five directors out of six also returned.

A section of staff petitioned the Inspector General of Government (IGG) twice last month challenging the recruitment exercise.

The IGG wrote back directing the UIA management to maintain the status quo until her office concluded investigations into the matter.

The IGG spokesperson, Ms Munira Ali, confirmed they are investigating “recruitment and mismanagement allegations”.
On June 19, the board’s human resource committee met and resolved to put on hold the restructuring exercise pending the IGG investigations. The committee was to present its position to the board meeting on Tuesday for approval. However, the guns were turned on Ms Kaguhangire.

This newspaper has since learnt that all contracts for the 12 directors and deputies were renewed during last week’s board meeting.

Mr Kugonza was contacted twice for a comment on this claim but he kept saying he was “busy” and promised to call back. By press time yesterday, he had not.