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Parliament irrationality and oil contracts

By Denis musinguzi

It is painfully clear the problem is not lack of laws and policy frameworks but lack of implementation efficiency

The signing of the PSAs on February 3, 2012 by Tullow, CNOOC, Total and government despite standing court cases and resolution by parliament slapping any oil transactions until comprehensive legislation is made, has attracted a lot of uproar. At the height of it has been the parliament which accuses the government of contempt of parliament, and a host of other civil society organizations, both of which have threatened to petition Ugandans, including pregnant mothers in hospitals contesting against the agreement.


Their agitation sounds credible at first since the discovery of 2.5 billion barrels of oil in the Albertine region in western Uganda holds potential for significant economic transformation for Uganda. Estimated at $74 per barrel, it means the oil is worth $148 billion, the money believed to be enough to run the present national budget for about 42 years without donor funding. This certainly turns the oil management into a hotspot; poor governance of the oil wealth is globally known to evoke a curse.

On the second thought however, Andrew Mwenda has provokingly presented the argument, that by blocking the signing of oil contracts the 9th Parliament will not improve but rather worsen the nascent sector, in such a profound manner that makes one to deeply rethink parliament’s posturing at fighting corruption. It should be recalled that parliament made the resolution following bribery allegations based on unfounded documents. Incidentally, Mwenda’s candid criticism of parliament comes at a time when public faith in the 9th Parliament has been greatly reduced by their unanimous and shameless acceptance of Shs 103 million each, to purchase sleek cars.

The acceptance of the money in the name of performing their “public” role, with utter disregard of the needy civil servants such as doctors and teachers who even do not enjoy a small portion of the hefty benefits and privileges enjoyed by parliamentarians makes one doubt their resolve at fighting corruption. The possibility that parliamentarians are fighting to leverage their personal and not public benefit is evident; the likelihood of them being purchased is clearly high. It is helpful to recall that the majority Constituent Assembly delegates who provided constitutional term limits are the same who lifted them, barely ten years later, at a shameful price of Shs 5 million, without any substantive justification.

What makes one even all the more suspicious is that the MPs’  posturing is not about the merits and demerits of the PSAs, but more insignificantly about making enabling legislation for leveraging public benefits from oil. I say insignificantly because any keen Ugandan is painfully aware that Uganda’s problem is not lack of relevant laws or required policy frameworks, but lack of implementation efficiency in the delivery of public goods and services, which parliamentarians are quiet about. Uganda has in fact become a cemetery of dead laws, dusted in law books, never in reality, but scarcely applied, if not selectively.

From decentralisation policy, through Poverty Eradication Action Plan (PEAP), Plan for Modernisation of Agriculture (PMA), to the recent Prosperity for All (PFA), successive Development Plans (DPs) and African Peer Reviews (APRs), Uganda has had dismal performance in spite of excellent legal and policy frameworks and veiled political good will. Any MP who is not aware and ashamed of this reality does not qualify to be in parliament. The solution is clearly not in making legal frameworks, however necessary they are, but to understanding the cause and finding solutions for their abhorrent failure.

Uganda is actually in a favorable position since adequate regulations and procedures for the management of natural resources have already been put in place. The passing of the 2005 Access to Information Act (AIA) and the 2008 Oil and Gas Policy (OGP) benchmark significant progress in ensuring transparency in the governance of resources. OGP particularly recognises the importance of public participation, and provides for the implementation of the Extractive Industries Transparency Initiative (EITI). This must certainly be credited as an enormous improvement on the 1985 Petroleum Exploration and Production Act (PEPA), which was oblivious of any ‘downstream’ activities, particularly local consultation in the decision-making process. These might have some loopholes, but to slap bans on transactions instead of filling the gaps is like throwing the child with the littered bath.

Besides, parliamentarians would make a strong case if, armed with scientific and comparative studies about similar contracts, solicited expert opinion, assessment of the competency of the contracting parties, and with projected costs for losing time, showcased the merits and demerits of the current PSAs and providing the more viable alternatives. Frustratingly, none of their arguments are substantive but procedural. Eventually, parliament does not help the electorate whose interests they purport to represent to know the costs and benefits for either carrying on with or abandoning the PSAs. By not providing these vital details but insisting on legislating, albeit their official role, the parliament is clearly engaged in parroting, not securing public utility of the rich resource as claimed.

In the end, all this works to validate Mwenda’s trepidation that parliament risks to make a ‘bad’ deal worse. But more critically, it also brings to question the parliament’s seriousness in executing its mandate. In fact I think it’s time parliament revised its rules of procedure to allow room for robust consultation and expert input especially in technical matters, prior to debate. Using the parliament merely as a theatre for expressing uninformed opinion, personal bias, unfounded fears and emotions as opposed to informed debate will simply not help.

As a way forward, I believe the agitation should be on compelling the government to fully implement the existing policies; filling the existing legal and policy gaps; adoption of EITI in accordance with the 2008 Oil and Gas Policy; free access to information in accordance with the 2005 Access to Information Act; and shielding the economy, more especially the agricultural and tourism sectors, from higher oil liquidity and resulting inflationary pressures.

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