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Minister, UIA staff lock horns over Shs500m ‘service award’

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State Minister for Investment and Privatisation Evelyn Anite (right) greets then Uganda Investment Authority (UIA) board member, who is the current board chairperson, Mr Morrison Rwakakamba, in Kampala in 2019. Ms Anite has directed UIA top management to return Shs545m they paid to themselves as “honoraria payment”. PHOTO/FILE

The State Minister for Privatisation and Investment, Ms Evelyn Anite, has directed the Uganda Investment Authority (UIA) top management to return Shs545m they paid to themselves as “honoraria payment” off the loan-funded Kampala Industrial Park Development (KIPD) project.

In a June 12 letter to the UIA board chairperson, Mr Morrison Rwakakamba, Ms Anite described the payment as “despicable, uncouth, barbaric, and uncultured “that UIA top management can dip their hands into funds for a project that has stalled for five years against its initial completion date of January 5, 2024.

“All these tantamount to mischarge, abuse, and corruption at the expense of the taxpayers of Uganda,” Ms Anite wrote. 
She directed that top management led by the director general, Mr Robert Mukiza, “refunds all the money” within 24 hours from the receipt of the letter” back to the KIDP project account” and “failure to do so within the stipulated time frame will attract dire consequences.”

Mr Mukiza, speaking through an intermediary, told this newspaper last evening that: “The honorarium is perfectly legal because it was already spelt out in the contract.”
“Maybe the minister is being misled or she has not read the contract in detail,” Mr Mukiza added.

UIA is the statutory agency charged with initiating and supporting government’s investment initiatives and policies.
Mr Mukiza and eight other staff, according to the letter, paid themselves Shs280m on July 23, 2023 for undertaking “additional responsibilities” to bridge the gap in the supervision of the infrastructure development of the project in August 2022.

Mr Mukiza received Shs82m; his deputy, Dr Paul Kyalimpa, Shs58m; Ms Patience Kabije, the contracts and claims manager, Shs43m; Mr John Bwambale Kyamakya, the transactional and contractual risk manager, Shs43m; Ms Amina Nassaka, the contracts and claims assistant, Shs17m; Ms Suzanne Akware Okissa, the records manager, Shs17m; Ms Joanitah Kambedha, a documentalist, Shs8m; and Mr Mwanga Muzamil and Mr Augustine Katale, both drivers, Shs4m each.

Other staff received money in the second tranche in euros included, the KIPD project manager, Mr Alex Nuwagira, Shs92m; Mr Felix Tumukunde Beinamaryo, the project engineer, Shs55m; Mr Emmanuel Muhumuza, the project architect, Shs49m; Mr William Sande, the project quantitative surveyor, Shs36m; and Mr Dominic Mugesera, the project accountant, Shs30m. These form part of the KIPD project management team.

Mr Mukiza, had on June 10, submitted request “for additional honoraria,” which Ms Anite directed be rescinded “within 24 hours and henceforth refrain from making such unscrupulous request on diverting project loan for personal gains but rather focus his energy and that of his team members to ensure that the project deliverables are completed for the benefit of our country.”
In a terse response, Mr Rwakakamba told this newspaper yesterday that: “I will call you back when I have received the letter.”  The board apparently blessed payment of the money, according to internal correspondences.

The Ministry of Finance in 2018 borrowed euros249m (about Shs1 trillion) from the UK Export Finance and Standard Chartered Bank of London to finance development of KIBP to facilitate industrialisation. The project includes tarmacking roads and bridges, a Small and Medium Enterprise (SME) hub, and related amenities to ease investors setting up industries.
However, the project has been rocked by among others, claims of officials extorting and frustrating investors, dubious parcelling of land, parcelling of land to phony investors, and inflating costs of project development.

Officials admit that the project has been beset by delays, but it is expected to be completed by September 2025.
According to internal documents seen by Daily Monitor, UIA defended the honoraria allowance to cater for consultant’s responsibilities assigned to the project management team and UIA staff.

UIA’s management explained that following termination of the Owner’s Engineer (OE) on August 29, 2022, additional responsibilities were assigned to the project management team assisted by some UIA staff.
“The UIA board proposed that UIA management considers remunerating the staff for their additional responsibilities, and guided to execute it within the law,” reads in part an internal memo.

Basis
The board, among others, looked at the human resources manual on the applicable allowances, including honoraria is an allowance payable when UIA wants a particular piece of work to be carried out by an employee within a specified period of time which: Is exceptionally important to UIA:  Is outside the normal scope of the employees’ official duties: Involves disproportionate amount of the employees official and private time: involves temporary additional responsibilities: and requires the direct use of the officer’s special talent or professional skill or his/her active participation in the actual work.

The honoraria allowance, according to the UIA management, was determined on among others: the annual earnings of the OE of €uros313,298 (Shs1.2b); would have earned €626,597 (Shs2.5b) in the period September 2022 to February 2023; and the proposed honoraria for the same period is total € 124,822 (Shs503m) hence a saving of € 501,774 (Shs2b).

“Honoraria like any other allowance is subject to statutory deductions of PAYE and the employee’s contribution to NSSF of 5 percent. This is in accordance with section 19 (1) (a) of the Income Tax Act Cap 340 “Employment income to include any allowance” and the NSSF Act. The statutory deductions are to be deducted at source,” top management argued.