KAMPALA – Lawmakers on the Public Accounts Committee (PAC) have grilled officials from the Ministry Of Local Government over the unrecovered UGX 2.8Bn that was dished out to various local governments to buy motor vehicles and payback in instalments.
The Auditor-General, John Muwanga pointed out that UGX 2.8 billion was lent out to 31 Local Governments since the start of the revolving fund.
The last round of lending was in 2013.
It was noted that only UGX 2.1 billion was recovered, leaving an outstanding balance of UGX 740 million still unpaid.
The Auditor-General also faulted the Ministry for maintaining manual records of the revolving fund pointing out that the decision would explain the discrepancies into the balances on the rotational fund.
Further scrutiny of the fund showed that at the time of lending in 2013, the account balance was UGX 463.7 million with a total of UGX 2.1 billion having been refunded between 2013 and 2018, however, the balance on June 30, 2018, was UGX 184.9 million which implies that some of the funds were diverted.
The Permanent Secretary in the Ministry of Local Government, Ben Kamumanya told the Committee that the funds were mainstreamed into the ministry.
He said that they were allocated as district transport revolving fund to local government that wish to procure vehicles and says that 232 motor vehicles and 178 motorcycles have been procured.
This prompted the committee to task the Ministry to explain why up to now they have failed to recover the money that was lent to local governments to which Kamumanya confirmed that only four of them including Tororo, Gulu, Kabarole and Jinja have so far paid back their loans but said they have MOU with them are think they are inhibited by various reasons.
He explained, “You know that Local governments are always having financial problems, we have been able to recover some money in the past, though minimal.”
The MPs further demanded the Ministry to explain whether they did not have guidelines for repayment of this money and demanded to know whether this money was loan at districts were paying it back at what interest rate.
At first, Kamumanya informed the committee that this money was granted but when the MPs scrutinised the documents, they realized the money was lent in form of a loan and after further scrutiny, Kamumanya asked the committee to give him more time.
The PAC Chairperson, Nandala Mafabi gave the Ministry one week to avail the committee with documents showing how much money they received for the project, how many districts received this money, how much was given to districts and at what interest rate.
The audit report also pointed out that the Ministry has no database of all local administrative units on districts, town councils, parishes, villages and therefore not in the know about the staffing levels in these units.
However, this was rejected by the Ministry who responded saying they are in possession of a comprehensive database on local government units with Uganda currently having 134 districts, 41 municipalities, 124 municipal divisions, 425 town councils, 1812 sub-counties, 9,602 parishes and 64,835 villages.