Following the tabling of the Sugar Bill 2016 on 30th December 2016, the Committee on Tourism Trade and Industry was tasked to scrutinize and report on its findings. The main aim being to advise the House on way forward, and or suggest any necessary adjustments to the Bill for its adoption by the House before forwarding it to the President for ascent.
The Committee chaired by Hon Alex Ruhunda, Member of Parliament for Fort Portal municipality in Kabarole District, and deputised by Woman Member of Parliament for Apac District, Hon Betty Engola has since commenced its work on the said Bill, holding a series of meetings with the various stakeholders. The stakeholders include : the Minister of Trade, Industry and Cooperatives, Hon Amelia Kyambadde, the proprietors of the different sugar millers such as Kakira Sugar, SCOUL, GM, Mayuge, Kinyara, Ssezibwa, among others. The farmers (including out growers), and the LC5 chairpersons of sugar producing districts have equally had the opportunity to present their views to the committee for consideration towards the Bill.
The Chairperson of the committee from time to time communicated to the members that they would have the opportunity to hold field visits so as to ascertain facts on the ground other than depending on information that may not be entirely representative of the people who are directly affected. As a result, the committee has since travelled to the different sugar producing districts, such as Mayuge, Buikwe, Jinja, and Masindi. It is set to visit Kaliro district and Atyak for further fact finding.
What is interesting to note is the fact that all these different regions face different challenges and have different opinions on the different clauses in the Bill. For instance, the older millers in Busoga region have a challenge of competition from new entrants, whom they accuse of poaching, and stealing cane from out growers whom they have contracted. On the other hand, the new millers aver that the old players are mistreating the farmers and out growers, and or offer little money for their cane. It was recorded that prior to the entry of new players in the region, old players such and SCOUL offered farmers and out growers UGX 40,000/- per ton of cane. The new entrants set the price to over UGX 170,000/- per ton, which has since been adopted in the region.
In Bunyoro on the other hand, the existence of one miller, Kinyara has created a monopoly in the area and farmers are not getting the same amount of money per ton as their counterparts in Busoga region. Kinyara Sugar Company complains of cane poachers originating from Busoga region, and the existence of some jaggery mills equally threaten their supply of cane.
Notwithstanding, there are clauses that are intended to address this particular challenge in the sector. Under clause 22, the Bill provides for the creation of milling zones, and is largely supported by the old millers who want the new entrants within their vicinity out. In equal measure, this provision is opposed by the new millers and the farmers who profess that the older millers want to create a monopoly in a free market economy. The new millers who are establishing far away from the already existing firms are also in support of the zoning since they claim they have invested in creating a relationship with the farmers.
The creation of milling zones would entail the restriction of new companies wishing to establish within the proximity of 25 kilometer radius of an existing mill from doing so. The spirit behind this clause is that the milling companies would have consistent supply of cane throughout the year for high yields of sugar at maximum production.
The committee has also received views on the clause as to the composition of the Sugar Board under Part II of the Bill. Clause 2 establishes a board as a body corporate with perpetual succession. Clause 3 sets out the composition of the board, whose membership is appointed by the Minister, and includes five representatives of the millers and two representatives of out growers. This provision as it is, locks out private farmers who are do not have any contractual obligation with the millers. The committee has since received suggestions that there be equal representation of the millers and farmers. The other contrary opinion was that since most of the millers are foreign investors, they cannot be put I the controlling body of the sugar sector, and their representation thereto should be reduced to two. In fact, the LC5 chairperson of Kaliro District asserted that the government had given too much powers foreigners who now dictate what they want upon Ugandans other than Ugandans having their own agenda and demand for what the investors should engage in.
The committee is still holding public meetings to inform its final report, and is scheduled to travel several places both within and outside Uganda so as to ascertain the best practice around the world.