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Tough conditions set for approval of Uganda Airlines UGX280b

The chairperson of the Budget committee Hon Amos Lugoloobi faulted Minister Azuba for signing allotment of shares describing her actions as irregular given the fact that Uganda Airlines had appointed directors (PARLIAMENT PHOTO)

PARLIAMENT – In Friday, March 29 special sitting, legislators approved the UGX280b meant for the purchase of the two Bombardier aircrafts to be used by Uganda Airlines, although tough conditions have been attached to the funding that would see Parliament decline to fund the Uganda National Airlines Company Limited in the coming budget if Government fails to clean up and appoint substantive management of the company.

The approval followed recommendations in the report by the Budget Committee on the supplementary funding in which government had warned that failure to secure funding by close of business today would attract dire consequences for government if it fails to meet payment for the two aircraft.

The Committee faulted government for registering the shares of the company in the names of Monica Ntege and Matia Kasaija contrary to the Memorandum and Articles Association, instead of having shares held in the names of the minister of Works and Transport; and that of Finance Planning and Economic Development.

Uganda Airlines’ first of four Bombardier CRJ-900(CRJ9) planes takes to the skies for the first time in Montreal. (FILE PHOTO)

While presenting the report, Budget Committee Chairperson, Amos Lugoloobi also faulted Minister Azuba for signing allotment of shares describing her actions as irregular given the fact that the company had appointed directors.

He explained: “On the account of the above observations, this allotment is not admissible therefore cannot be sustained because it does not meet the requirement of allotting all shares to Government. The Committee recommends that the Ministers apologize to the House for the anomalies and formally withdraw the Special resolution of the Company and of allotment tabled before the House on 27th March 2019.”

Among the tough conditions set for the approval, Parliament has recommended to have the shares of the company in the names of minister of Works and Transport and Minister of Finance, Planning and Economic Development and have the resolution be filled with the Registrar of Companies that the allotment of shares is corrected.

Additionally, Parliament wants the ownership of the company should be transferred to the Uganda Development Corporation which is the business arm of Government as provided under the Uganda Development Corporation Act 2016.

With a number of weaknesses exposed at the policy-making level, Parliament also recommended having the Interim Board members be changed after discovering that many of them are full-time employees of Government and extremely busy in their substantive public offices.

The Committee pointed out Bageya Waiswa Permanent Secretary in the Ministry of Works and Transport, Keith Muhanikzi (Permanent Secretary/ Secretary to Treasury in the Ministry of Finance) Laban Mbulamuko is a Commissioner in the Ministry of Finance, Bisereko Kyomuhendo is a Commissioner in the Ministry of Justice and Constitutional Affairs and Capt. Gad Gasaatura (farmer and retired Flight Captain).

Mr. Lugoloobi urged that it would be difficult to imagine that the company will have a good footing if it continues being managed by this Board saying the current management staff are also holding interim positions and insisting to have the same members would put the company in a more precarious situation.

The committee was informed also that Capt. Gad Gasaatura who is purported to be the Chairperson of the Board has never been registered with the Uganda Registration Services Bureau in accordance with the Law with Mr Lugoloobi urging Government to appoint a substantive and competent Board not later than April 30, 2019.

Parliament also wants the Board Members subjected to a proper test and names presented before Parliament and if the recommendation isn’t followed, Parliament has threatened not to appropriate any funds to the activities and operations of the company for the 2019/2020 budget.

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