Thursday , February 9 2023
Home / Cover Story / NSSF stuck over ‘Orders from above’

NSSF stuck over ‘Orders from above’

NSSF’s new housing project in Lubowa. A similar real estate project has run into trouble as a result of a directive by President Museveni.

MD Byarugaba joins list of government officials ‘stuck’ over Museveni directives 

Kampala, Uganda | IAN KATUSIIME | In September President Museveni launched a new housing estate constructed by the National Social Security Fund (NSSF) in Lubowa, outside Kampala. The $73m estate has 370 housing units and Museveni praised NSSF for the big investment in Uganda’s housing sector.

However a proposed similar investment by NSSF in real estate in Kampala could run into trouble following a directive by President Museveni to NSSF to engage SMS Construction Company, a local contractor, in subversion of the procurement process underway.

Museveni’s decision was based on the need to promote capacity of local contractors- a shift from his obsession with Chinese contractors and investors. The directive to NSSF is for a commercial development of land on Yusuf Lule Road in the city centre.

Museveni’s directive to engage SMS Construction seems to have caught the pensions’ body unawares. The public procurement process for the design and build contract of the commercial development kicked off in July 2021. The directive relayed through Prime Minister Robinah Nabbanja prompted NSSF executive director Richard Byarugaba to write to Attorney General Kiryowa Kiwanuka seeking legal advice on the implementation of the presidential directive.

According to a letter from Kiwanuka to Byarugaba dated Sept. 22 titled ‘Legal Advice on the Implementation of the Presidential Directive’, seen by The Independent, Kiwanuka argued that the government’s intention is to promote capacity of local construction companies and “thereby strongly emphasises a particular strategic policy direction.”

The Attorney General added that the spirit of the directive was an existing policy direction related to local capacity. He wrote “This emphasis does not however amount to a change in technical circumstances surrounding or relating to the procurement requirement.”

The dilemma that Museveni’s directive has plunged Byarugaba in follows a pattern suffered by government officials dealing with a series of presidential directives referred to as “orders from above”. Usually, they are either politically expedient or a result of collusion or collision of business interests or both.

The presidential directives are part of the politics of patronage for which President Museveni has relied on in his 36 year reign to accommodate the competing interests in government; political, economic, cultural and ethnic.

Government agencies like Uganda National Roads Authority (UNRA), Uganda Revenue Authority (URA), Ministry of Finance, and Ministry of Energy have typically been at the receiving end of such directives.

There have been arguments on the tendency of some presidential directives to cause overlap, dysfunction and gridlock. This has bred a creeping defiance among affected executives.

Richard Byarugaba and Robinah Nabbanja

Bailouts for cronies

A letter written by President Museveni to the Prime Minister Nabbanja on Sept. 5 titled ‘Support to Mogas Uganda Limited’ sparked uproar on the crony capitalism that the president has perpetuated over time. In it, Museveni directed Nabbanja to use government resources to bail out the family behind Mogas Uganda by buying land from it.

Museveni wrote, “There is a Ugandan family, the Rugazooras that are quite active in businesses including owning petrol stations in Uganda, Tanzania, Burundi, Congo etc. They have some debts they could not promptly settle because of corona19 pandemic.”

In the letter Museveni told Nabbanja that the family has 15 acres of land in Mukono and urged Nabbanja to oversee a purchase with the advice of the Attorney General. “If the government bought that land they would get the money that could help them to reschedule their debts into manageable installments that they would be able to pay over a period over seven years,” he wrote.

Museveni directed Nabbanja to ensure either of Ministry of Finance or Ministry of Works buys the land at the prevailing market price. “Move fast so that the debt does not escalate,” he concluded.

The directive means that the prime minister would have to cajole Finance which has been embattled by a shortage of cash, reflected in delayed salaries for government workers in the last one month, to cough up to about Shs6 to 10 billion if an acre in Mukono is in the region of Shs400-600 million.

The Prime Minster and the Attorney General Kiryowa Kiwanuka have emerged at the centre of a series of presidential directives issued in the recent past.

In 2021, Museveni directed the Attorney General KIryowa Kiwanuka to probe the sale of Sibamanyo House and Afrique Suites, properties that belonged to businessman Peter Kamya who was under financial distress.

Equity Bank sold the properties after a reported loan default by Kamya. Whereas the president asked the Attorney General to investigate the matter in a normal query, there was concern that the President could have been exercising undue intervention in a commercial dispute.

The president’s letter read. “Peter Kamya and Dr Margaret Muganwa Kamya have appealed to me seeking for my intervention in the alleged illegal sale of the above-mentioned properties by Equity bank. They state that their properties were sold when there were cases pending in court and without a court order. This is to direct, that you urgently investigate the matter and render a legal opinion within one week”. Details of the matter are unknown a year later.

Validity of directives

In December 2021, UNRA executive director Allen Kagina, a longtime public servant, laid bare the dilemma heads of government agencies often find themselves when dealing with presidential directives.  Kagina told MPs at a parliamentary hearing that a presidential directive is only valid when it is in writing.

Kagina stressed to MPs of the Physical Infrastructural committee, which exercises oversight of UNRA, that presidential directives can only be implemented when they are in writing. According to people familiar with the matter, Kagina was hesitant to implement some directives because they were not formal–putting her at odds with the President who usually wants his directives implemented quickly.

The case that is most cited is a directive from Museveni in 2017 to then- UNRA boss Kagina on awarding a contract to Dott Services to upgrade the 100km Nakalama-Tirinyi-Mbale Road. At the time, UNRA was under new management of Allen Kagina who took over in 2015 and was wary of making any irregular decisions reminiscent of the old UNRA that was rocked by corruption and mismanagement scandals.

According to Allan Sempebwa, UNRA communications manager, UNRA was dissatisfied with Dott Services work in the past and the firm had also been blacklisted. The President however strongly vouched for Dott Services and the company was awarded a lifeline.

According to Kagina, she did not want to come under fire in future for enforcing what would be deemed an illegality in case an audit query arose on the matter. She therefore wrote to William Byaruhanga, then Attorney General, for legal advice on the matter. Byaruhanga is said to have told the UNRA boss that the president’s directives are enshrined in Article 99 of the constitution which vests executive authority in the president.

The Dott Services case with UNRA captured the dilemma of government agencies who have a statutory mandate but also have to act on presidential directives.

Kagina also told the parliamentary committee that some presidential directives can only be implemented after confirmation of availability of funds from the Ministry of Finance, Planning, and Economic Development and ascertain whether financing terms with the contractor are acceptable.

Parliament’s Committee of Physical Infrastructure also wanted to find out from Kagina the implications of Museveni’s several directives that were issued arbitrarily to foreign firms. It is not unusual for Museveni to direct UNRA to award tenders to Chinese companies, for instance, to do certain roads in alleged flagrant disregard of procurement processes as stipulated by the Public Procurement and Disposal of Assets (PPDA) Act.

During the early phases of procurement of the Kampala Jinja Expressway, Museveni in 2019 halted the process and directed that the contract be granted to a Chinese firm under a Public Private Partnership (PPP) arrangement.

By December 2018 UNRA had shortlisted four international contractors for the expressway job but four years later there appears to be gridlock. According to UNRA, the process is now back to competitive bidding again. It will still be handled under a PPP arrangement.

Some President Museveni directives

July 2022:  Museveni directs the Ministry of Agriculture to give a Turkish investment group, Beyler Group 15 acres of National Animal Genetic Resources Centre and Data Bank land in Entebbe to build a modern hospital.

July 2022: Museveni directs the police to offer security to Internal Medicine of Virginia Ltd to enable them take possession of contested land in Naguru, Kampala.

May 2022: Museveni directs cancellation of Shs800 billion power deal with blacklisted Chinese firm, China CAMC Engineering Company Limited (CAMCE), to construct 7 electricity substations and high voltage transmission lines in Kapeeka, Sukulu, Mbale, Wobulenzi, Nakasongola and Kaweweta Industrial Parks.

December 2021: Museveni directs Ministry of Works and UNRA to give contract to Abubaker Technical Services to construct Matugga-Semuto-Kapeeka Road and two other road projects

September 2021: Museveni directs Prime Minister Robinah Nabbanja to order all Ministries, Departments and Agencies of Government to give printing works to Vision Group and Uganda Printing and Publishing Corporation (UPPC).

July 2021: Museveni directs the ministries of Health and Education to use UPDF Engineering Brigade on their construction projects

January 2021: Museveni directs Ministry of Finance to suspend Democratic Governance Facility (DGF), a donor fund, over lack of government oversight

May 2018: Museveni directs First Lady and Education minister Janet Museveni to reappoint sacked Prof. Wasswa Balunywa as Principal of Makerere University Business School (MUBS) in Kampala.

March 2020: Directive to Ministry of Health to put in place 42,000 beds targeting 42,000 sick people at the start of the COVID-19 pandemic.

****

Leave a Reply

Your email address will not be published. Required fields are marked *