KAMPALA – The Constitutional Court of Uganda has promised to give its ruling on the ungiven date of the case that seeks to halt government funding of the construction of shs1.4 trillion Lubowa International Specialised Hospital.
The petition 07/2019 brought by the Initiative for Social and Economic Rights (ISER) against the Attorney General, argues that the process approving the proposed shs1.4 trillion Lubowa International Specialized Hospital Uganda’s (ISH) development was irregular and contravened the Constitution ISER is calling on the Constitutional Court to declare these agreements null and void.
A series of agreements were signed between the government and Finasi Roko between 2014 and 2018 to design, construct and operate this specialized hospital with government issuing promissory notes not exceeding $379.71 million. It was only in February 2019 that the Minister of Finance tabled this before Parliament. In March 2019, the Parliamentary Committee on National Economy, in its report, observed that necessary parliamentary approval had not been obtained before government signed these agreements as required by Constitution but went ahead and recommended that the House approves the proposal for government to issue promissory notes, In 2019, Parliament approved promissory notes of USD 379.71m (about 1.4 trillion) to Finasi Roko SPV Ltd to finance the design, and construction, and to equip the ISHU. Over 8 years, the ministry of health is to pay USS $$7 million to finance the redemption of these notes at maturity. The hospital was supposed to be constructed in two years, run for six years and then handed over to the government. The government provided free land and tax holidays.
Speaking to the press shortly after the case hearing on Thursday, Mr Joseph Manoba, the petitioner’s attorney it was unconstitutional for the ministries of health and finance to conclude agreements without prior requirements.
“Under article 159 of the constitution, clause 2 and 5, it requires that the Parliament must make a resolution to borrow or provide a guarantee and once the resolution has been made by the Parliament to proceed to that effect, then the agreements that are entered must be brought back to Parliament for approval.”
“As of now, these agreements were not presented before Parliament as it is required by the constitution. However, Parliament retrospectively approved these agreements and the necessary payments that follow. This is unconstitutional!” said counsel.
Ms. Elizabeth Ators, Legal Officer, ISER said, “Everything about this process was flawed and ignored the Constitution We should not operate oaside the ambit of the law The Constitution is clear about what needs to be done before government takes or guarantees a loan I also enshrines the right of citizens to participate.”
Mr. Allana Kembabazi, Program Manager, ISER said, “This was a flawed process and Courts delay to halt it hurts tax payers Government continues to inject money into this illegal project. The money spent on this project so far could have constructed public health facilities like district hospitals All it does is increase our debt burden.”
According to him, the process of approval was not the only one mired with irregularities, noting that, “In 2018, Members of Parliament together with the Permanent Secretary of the Ministry of Health were locked out of the project site. In April this year. Members of Parliament demanding progress on Lubowa hospital found limited progress. This year, the Ministry of Health admitted that the developer of the hospital, Finasi led by Erica Pineti was not on site and it had been abandoned by the contractor despite government injecting billions into the project.”
Ms. Labila Sumaya, Program Officer Right to Health at ISER noted that, “The question is who do these public private partnerships (PPP)projects in health truly serve. Many people can’t afford private healthcare due to high costs according to ISER’s research, Achieving equity in health. The Lubowa PPP hospital won’t deliver accessible healthcare. Invest in public health facilities.”
However, in response, the Attorney General said that the Project does not contravene and is not inconsistent with Articles 2 (1), 159 (2) (6) and (5) of the constitution of the Republic of Uganda, 1995 (as amended).
“The Direct Agreement that came into force on the 4th December 2018 executed by the Ministry of Finance Planning and Economic Development acting on behalf of the Government of Uganda, FINASI/Roko Construction SPV Limited and the finance parties African Export-Import Bank and Barclays Bank of Uganda pursuant to Project Works Investment Agreement does not contravene and is not inconsistent with Articles 2 (1), 159 (2) (6) and (5) of the constitution of the republic of Uganda, 1995 (as amended),” said AG in his response file.
“That the resolution by Parliament passed on the 12th day of March 2019 to approve the proposal tabled by the Hon. Minister of Finance Planning and Economic Development for Government to issue promissory notes of USD 379.71 Million to FINASI/Roko Construction SPV Limited for the financing of the design construction and equipping of ISHU at Lubowa-Wakiso does not contravene Articles 2 (1), 159 (2) (6) and (5) of the constitution of the republic of Uganda, 1995 (as amended).”
ISER now want the court to declare that the actions of the ministers in entering into these agreements without the requisite approval from Parliament contravene the constitution.
“We want the court to direct that the moneys that were spent from the consolidated fund to cash the promissory note be refunded,” said Manoba.