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Parliament orders probe into ‘sinking’ Uganda Telecom

Uganda Telecom MD Shoebridge and other officials cut a cake as the company recognised its top customers in the Customer Appreicaition Week at Sheraton in September.
Uganda Telecom MD Shoebridge and other officials cut a cake as the company recognised its top customers at their Customer Appreciation Week at Sheraton in September.

Parliament has approved a report and passed a motion seeking to establish a select committee to investigate alleged mismanagement of Uganda Telecom Limited (UTL). Top officials of the company have also been barred from travelling abroad until the probe is finished.

Following the debate on a report “The predicament at the sinking Uganda Telecom” tabled by Budadiri West MP Nathan Nandala Mafabi, speaker Rebecca Kadaga ruled that a select committee be set up to investigate specific matters of mismanagement of the telecom company.

Names of the seven-member committee will be unveiled on Tuesday. They will be required to report back to the house in two months.

Parliament was told that so far, petty cash to the tune of sh1.5billion is missing while the company spends up to sh4 billion monthly in salaries and allowances to top officials, with no equivalent income.

Nandala, while presenting the statement, noted that the company has been bleeding financially, with no audit done for four years.

He said as a result of there being no audits of the company accounts and assets, it took long to detect a fraud that went on for years where petty cash to the tune of more than sh1.5 billion is said to have vanished.

The former leader of opposition in parliament further revealed that over sh4 billion is spent monthly by the company on what he described as huge salaries, allowances and other benefits.

“Despite UTL financially bleeding, top managers are paying themselves huge salaries,” Nandala told parliament.


Big salaries

“The top four – Managing Director Mark Jude Shoebridge earns sh150m a month, Chief Finance Officer James Wilde sh120m, Chief Legal Officer David Nambale sh90m and Chief Human Resource Officer earns sh60m which makes a total salary of Shs 420 monthly,” Nandala told parliament.

“This is a third of the salary bill for the about 500 UTL workers. These salaries are indeed the highest for such staff in any company in Uganda.”

Nandala also told the house that UTL where government owns 31% shares with the majority owned by a Libyan company Libya African Portfolio Green Networks (LAP Green N), could collapse if nothing is done to save it.

It is upon this background that Nandala requested parliament to set up a select committee to fully investigate activities going on as well as carry out a Financial and Forensic Audit.

He argued that UTL, which he described as a giant that once provided services to government institutions, other organizations and the public, still has a major role to play in the in the economy and it should not therefore be allowed  to collapse.


MPs react
The workers representative (Western) Arinaitwe Rwajakara said that the top management of UTL should step aside to allow smooth investigations while Bughaya County MP Pius Wakabi suggested that the managers be detained during investigations.

Issues to be investigated include tax debts to Uganda Revenue Authority (URA) and failure to remit payments to NSSF.

Uganda Telecom speaks out

In a separate interview, the board Chairman Stephen Kaboyo described the report as skewed. He said it makes the problems of UTL look current yet they are historical, having existed, he said, even during the time when the Libyans were in control before the death of Libyan leader Colonel Muammar Gaddafi.

Kaboyo explained that some of the issues highlighted in the report like the huge salaries and allowances are beyond their mandate.

“The majority shareholder has a say on hiring and management. These expatriates are hired and their salaries and remunerations are negotiated from Dubai,” Kaboyo said.


No travel abroad

Speaker, Rebecca Kadaga, directed that those named in the report on the mismanagement of UTL are banned from traveling abroad.

Those banned from travelling abroad by parliament include board chairman #Kaboyo, Managing Director, Mark Jude Shoebridge,  Chief Finance Officer James Wilde, Chief Legal Officer, David Nambale and board members Kalid Tarapolisi and Stewart Simpson.

UTL was the first company to own a Full Telecommunications Operator license, having evolved from the earlier East African Post  and Telecom Corporation in the 1970’s, and the Uganda Post and Telecom Corporation in the 1980’s and 1990’s. UTL was incorporated in 1998 as a Public Limited Liability Company.

In 2007 LAP GreenN acquired 69% of its shares, and the Government of Uganda holds the remaining 31% of shares.

‘UTL not to be sold’

Last month, the company denied rumours it was being sold

“Uganda Telecom Limited  wishes to address the false and misleading stories that have been published in sections of the media, particularly in online publications, regarding the sale of the company. Uganda Telecom has not been sold nor is in the process of being sold,” UTL said in a statement.
“Our two shareholders are working closely to ensure that the company strategy and business plan are implemented. Uganda Telecom continues to broaden its portfolio of services and remains dedicated to innovation and offering our customers the highest possible service levels.”


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