Finance minister, PS clash over sh150b

Secretary to the treasury Keith Muhakanizi

A fresh controversy has rocked the finance ministry, with the Permanent Secretary and Secretary to the Treasury, Keith Muhakanizi, clashing with the finance ministers, Matia Kasaija and David Bahati, over the sh150b compensation to Ugandan traders who suffered losses during the South Sudan conflict.

UGANDANZ has established that the sh150b meant for 10 companies that were jointly verified by Uganda and South Sudan by scrutinizing their contractual obligations before the war broke out, might have actually been paid out to fake companies.

Multiple sources at the central bank and the finance ministry have revealed that six out of the approved 10 companies are allegedly briefcase/ ghost organisations, whereas the four are reportedly registered in the names of a single director who received the payment on behalf of the others.

Consequently, Muhakanizi has contested the payments in an internal memo dated February 11, 2019, which Sunday Vision has obtained. Muhakanizi’s internal memo was written to the finance minister, Matia Kasaija, but also copied to the deputy secretary to the treasury, Patrick Ocailap; the Accountant General, Lawrence Ssemakula and the director budget, raising a red flag on the release of the money.

The finance ministry’s permanent secretary says no further payments in relation to the compensation should be sanctioned, until a proper verification audit on the benefiting companies has been carried out.

“As I informed you earlier, I had advised that all claims by the traders should be verified through an independent audit by Ernst and Young, before the compensations are undertaken, just like we have done for the rest of the domestic arrears, which has saved Government over sh400b,”

a copy of the memo, seen by UGANDANZ, reads in part. The memo adds:

“However, when I reported back to office this morning, I found that the process of making the payment was underway. I have now halted the process, until the claims are verified independently.”

“This, therefore, is to inform you of the need for an independent audit of the claims as earlier discussed with you and to reiterate my advice that the claims should be re-verified before any payment is made. However, if I am directed, otherwise I will take no responsibility for any potential fraud that might emerge,” Muhakanizi said.

Earlier this week, the Nwoya County MP, Simon Oyet, asked Parliament to task Government with producing the list of the 10 companies that had benefited from the sh150b as had been reported by the New Vision on Monday, February 25. He also claimed that he was aware that out of the 23 companies that had originally been approved by Parliament to benefit from the compensation, only three had made it to the final list of the 10 companies.