MPs plot to censure Kasaija over Shs700b

What you need to know:

  • Probe. The Members of Parliament have advised that the IGG should further investigate Mr Muhakanizi for possible conflict of interest.


Finance minister Matia Kasaija and Secretary to Treasury Keith Muhakanizi were last evening left on the brink of losing their jobs with Members of Parliament divided over their fate as the House commenced debate on a hard-hitting report demanding that the duo be fired for bungling up a disputed $200m (about Shs700b) loan.
Parliament failed to reach consensus with MPs across the political divide insisting that the Public Accounts Committee (Pac) report recommends censure of the two Finance Ministry principals, while government ministers countered that the Auditor General be given time to carry out a forensic audit of the Consolidated Fund to establish where the money went.

The loan
Government in 2016 took the loan from the Eastern and Southern African Trade and Development Bank (PTA Bank) for the procurement of medical supplies for the National Medical Stores (NMS).
The money was also meant to cater for the procurement of earth moving equipment from China and funding of Rural Electrification Projects.
Approval for the loan was controversial as it was initially rejected by Parliament on grounds that there was no compelling reason to borrow.
Technocrats at the Ministry of Finance, however, turned around and re-tabled another loan request but for the same, which Bank of Uganda governor Tumusiime Mutebile opposed on grounds that BoU had “more than sufficient foreign exchange reserves to support these interventions.”
The Finance Minister disregarded Mr Mutebile’s advice and proceeded with the loan request which Parliament approved.
But a lid was opened on the bungling up of the loan when NMS wrote several letters to the Mr Kasaija and Mr Muhakanizi, asking for the money that was meant to buy essential medical supplies but the Finance minister now advised NMS to get medicines worth Shs41b on credit.
As the row between the Finance ministry and NMS hit a turn for the worse, the latter threatened not to supply medicines to at least 3,000 health centres starting July if Finance does not provide the agency with Shs68b required to cover the shortfall in their budget.
Though REA was supposed to receive $2.8m (about Shs10.1b) as part of the loan, the Committee discovered that agency had no project that was directly funded by the PTA Bank.
Mr Kasaija yesterday failed to present a personal statement detailing what went wrong with the loan but maintained that no money was “stolen” as he fought to save his job.“I request that we should give an opportunity to a government authority to find out where this money went. But I want to give assurances to this House that no money was diverted or stolen,” Mr Kasaija said.
With the loan approved only after the Finance ministry changed its labelling, Speaker Rebecca Kadaga last evening ruled that she will today make a decision regarding the fate of the report, with the duos fate set to be decided today.
“I may not talk much but I had engagements with Ministry of Finance over that money. I had engagements to remind the ministry that that money was partially borrowed for NMS. I had meetings in my office over that money,” Ms Kadaga ruled.
The loan put the Executive and Parliament at loggerheads with the Speaker at some point ordering the Rules Committee to investigate Mr Kasaija over contempt of Parliament as the fallout escalated.