Note: This is our record of what transpired in the meeting. Not verbatim.

Meeting with Uganda Investment Authority (UIA)

Discussed in the Committee on Commissions, Statutory Authorities and State Entreprises on November 17th, 2014

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Hon Ssemujju chaired headed the meeting and the accounting officer from UIA was Mr Frank Ssebowa, the Executive Director.  The ED gave a brief overview of the authority and the chairperson gave the members an opportunity to ask the authority general questions pertaining its existence.

The meeting was scheduled to hear UIA’s responses to the queries raised in the Auditor General’s Report of 2012 and 2013. The chairperson started with Audit queries for the year 2013, they include;

Unaccounted for fuel funds worth UGX 191 million; fuel requisitions, authorizations and activity reports were not availed to the auditors, so no conclusive decision would be made for the amount of fuel used in the year. The committee ruled to evoke the audit act which criminalizes the act of not providing necessary documents for the audit. In addition, Money advanced to staff members to facilitate official workshops remained unaccounted for. The ED told the committee this was as a result of official’s responsible not providing necessary receipts to the office. This delayed the process but the receipts were currently available and at the auditor general’s disposal. Management also promised to provide the list of the specific individuals who caused this delay.

There was a query of un-acknowledged remittances to URA as withholding tax and Pay As You Earn worth UGX 312 million. The auditors without the corresponding receipts could not affirm that the remittances reached URA. Management handed the corresponding receipts, the committee instructed the Auditor s to verify them before any further decisions were made on the matter.

On the staff establishment gaps, management asserted that they were unable to attract, retain and motivate staff because of what the staff assumed was “low pay” by Authority. The committee also probed the incident where one interviewee was chosen over another and yet the latter had better qualifications than the former. Management told the committee that a committee at UIA made the decision after a series of interviews rendered the former a more suitable candidate for the job. Management also assured the committee that they had advertised a number of positions that were yet to be filled.

The Auditor General’s office also pointed out that UIA did not have a Board of Directors to undertake major decisions for the authority. Another query, absence a Corporate Strategic Plan rose due to lack of a board. The draft needed to be officially approved by the board. However, currently there is a strategic plan approved by the minister of finance who currently does the boards duties.

On the queries on Industrial Parks,

  • In Mbarara a number of tenants had rent arrears totaling to UGX 81 million. It was also noted that work space in the industrial park was underutilized and yet it was procured at UGX 2.5 billion. Management told the committee that most stubborn tenants in the park were inherited when the land was procured but they had been given an ultimatum to vacate the park if they did not settle the arrears by February 2014. The meeting didn’t give the status of the situation currently.
  • In Kampala industrial and Business Park, Namanve, the audit reported that of the 227 projects offered land for development only 19 were active and because of non-utilization of the un-authorized activities like stone quarrying and brick making were evident in the park. Management blamed the slow government funding and were also considering redistributing government land to investors ready to develop the park.
  • The Jinjaindustrial park, where 182 acres of land remain unutilized and had turned into a bush. Management maintained that they were awaiting approval of the Environmental impact assessment from the Municipality. Although 100 acres of the land had been allocated to Makerere College of Engineering in regard to the Kira EV project.

The audit also pointed out that there were activities that were not carried out by UIA despite being planned for. On the other hand a number of activities that were not planned for were carried out.

 

Audit queries for the financial year 2012

There was a short fall in Non-Tax Revenue, UIA budgeted to collect UGX 999 million but only UGX 335 million was realized. This was way below revenue collected in the previous year 2010/2011. Management said the shortfall was due to a debt write off for land sold to UNBS by the authority.

UIA also lacked an investor monitoring and after care services. The audit noted that most investors were given licences with conditions but the authority rarely monitored to ensure the conditions were not breached. It was also indicated that there was no system to track and assess the value actual investment value. Management attributed this to the strained budget and told the committee that the authority had partnered with Bank of Uganda and UNBS to carry out the exercise on sampling basis.

Also noted in the report was the fact that of the 11.113 billion budgeted for by UIA, only 6.2 was released for the Authority’s activities.

Failure to recover an outstanding balance on a land sale by UIA, the land in question is that in Kinoni acquired in 1997 and was later sold to Abeki Farm Enterprises at UGX 405 million. There was a down payment of UGX 205 million and the remaining had taken a while to be paid. Management told the committee that the money had been collected. However the committee wasn’t satisfied with the fact that no interest was charged on the money and yet the value was appreciating. Parliament requested for the agreement to scrutinize the terms.

The audit also reported an incident where Uganda Land Commission (ULC) allocated land belonging to UIA to Surgipham (U) Ltd for three years. ULC on another occasion allocated land belonging to UIA to Victoria Best Ltd. Management asserted that on both occasions it sued ULC and currently owns the land.

The committee instructed UIA to avail the missing documented evidence to correspond with their responses. The meeting was adjourned to a later date where audit queries for 2011 would be handled.

 

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