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Posta Uganda’s tricky Shs1.4bn restructuring

By Rukiya Makuma

Post office body lays off 200 workers but some return amidst allegations of corruption

James Muganzi was one of 196 workers who were laid off by the Uganda Post Ltd, commonly called Posta Uganda, in May. When the termination benefits were calculated, Muganzi was among the top 20 beneficiaries.


As a Post Supervisor, he got a net going away package of Shs 4.6 million. Surprisingly, however, Muganzi still works at Uganda Post Ltd. Was his termination faked? If so, who benefitted from faking it?

Muganzi’s case is not the only one that is unusual. Uganda Post Managing Director, James Arinaitwe, told The Independent that before the staff terminations, which are part of larger restructuring of the company ordered by Parliament in 2010, the company had up to 500 staff. Even after laying off 200, the company still has 420 employees. A few of the new staff are old employees.

When asked about Muganzi, Arinaitwe said Muganzi is indeed still an employee of Uganda Post Ltd. But instead of working as a Post Supervisor in charge of buses, he is now officially listed as a Bus conductor.

It is alleged, for example, that after receiving his termination letter and benefits, Muganzi “just made a phone call and was reinstated”. Muganzi’s case is peculiar. Although he was not highly qualified, having only a lower secondary Senior Four certificate, he was holding the title of a Post Supervisor for the Buses/Transport section and earning Shs850,000 per month.

He was earning more than Hellen Akiding, a receptionist, and Dinah Irutu, a Sorting Officer. Both were university graduates but were earning a paltry Shs260,000 per month. Akiding got Shs2.2 million when she was laid off and Irutu got Shs 1.6 million.

Cases like Muganzi’s; where highly qualified people were employed in low positions and paid less while lowly qualified people occupied top offices and collected fat salaries, are what prompted the staff restructuring. The Parliamentary Committee on Commissions, Statutory Authority and State Enterprises, which was at the time chaired by Aswa MP Reagan Okumu, caught the anomalies during its investigations into alleged mismanagement of the company. At the time, the company was at pains to explain to parliament how Shs 2.2 billion had been misappropriated and why it needed a capitaI injection of Shs 12 billion.

The committee recommended that Arinaitwe upgrades the company systems and procedures, and hires skilled workers. It appears, however, that the exercise which was cost at Shs 1.4 billion in workers termination packages alone, might not deliver the desired objectives for the company. Arinaitwe is now being accused of favouritism, unfair fair pay, and wrongful dismissal at Uganda’s post office service provider.

A worker at the company told The Independent on condition of remaining anonymous that Arinaitwe is “retaining his close allies in the restructuring process whether they have the qualifications or not”.

“What mattered was whether your name appeared on his wish list,” the source said.  Other workers accuse the MD of taking over the process and handpicking M/S Future Options to recruit staff on behalf of Posta Uganda. The company was allegedly awarded a Shs89m contract without following procurement rules.  It is alleged Atuhaire influenced the recruitment.

Caleb Muhanguzi was also one of the laid off staff, but reinstated.  His transcript shows he completed school in June 2001 but had graduated two months earlier, in April 2001.

Muganzi was in 2009 at the centre of a Shs4 million scam at the company. The money went missing when he failed to deposit it in the company strong room as required by the standard operating procedures. He claims he kept it in his office from where it was stolen.

A union officer at the company confirmed to The Independent that the union had recommended that he be dismissed. But Atuhairwe stuck by him.

Muganzi told The Independent that he paid back the money because it got lost while under his supervision. He says the strong room where all the money is deposited was locked because it was a public holiday and that is how the money ended up in his office from where it was stolen.

Arinaitwe says people who were laid off did not have the qualifications for the jobs they held.

“We cannot have a manager who can not operate a computer in this era of technology where everything is computerised, communication is through email. How do you work with such a person,” he says.

He says the restructuring, which started in 2008 and ended in May 2011, was necessary to re-skill the company.

He said he expects a 44 % rise in revenue performance and its revenue to rise from 14 billion to 20 billion per annum.

Atuhairwe also dismissed allegations in an anonymous dossier written on June 8 and addressed to President Yoweri Museveni, the Speaker of Parliament and the Prime Minister alleging corruption and embezzlement of funds at Posta Uganda.

It alleged that because of his involvement in investigating mismanagement at Posta, MP Okumu Reagan “draws weekly full tank fuel on account of Posta Uganda” while the Posta Uganda Board Chairman, Dr. Odimbe Were, “enjoys endless foreign trips.”

Arinaitwe says Posta Uganda partners with all post offices in the world and is part of the East African Communication Organisation, Pan African Post Union and the Universal Post Union. Each of these organisations holds meetings at least once every quarter and Posta Uganda is mandated to attend these meetings. The last EACO policy meeting that was held in Kigali from May 23-27 was attended by Board Chairman Odimbe. He says Okumu was financed only once as a chairperson for the committee on a trip to Lira in 2010 to commissioning Telecentres there under the Rural Communication Development Fund project which had been funded by the World Bank.

When contacted, Okumu said as chairman of the committee, they discovered a lot of infighting between the staff and top management, alleged scandals of corruption like the Shs 90 million theft by John Kazibwe and that most of the staff had been fraudulently recruited even by the former management. He says the committee made recommendations to the Ministry of ICT where Posta Uganda falls but their advice was ignored.

“Posta is a patient on drip whose only medicine will be government intervention if it’s to deliver and fulfil its purpose,” he said.

The Minister of State for Economic Monitoring in the Office of the President, Henry Banyezaki, says appropriate measures will be taken once it is discovered that the allegations against the company are true.

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