PUBLIC ACCOUNTS COMMITTEE. The meeting was chaired by Hon.Kassiano Wadri and the lead counsel was Hon.

Kwizera Eddie. The meeting was held on 20th Jan, 2014 from 10am-4.45pm. The committee was meeting a team from the Office of the Prime Minister (OPM) led by the PS Mrs.Guwatudde Christine. The meeting was about the Auditor Generals report on the financial statements of the year ending 30th June 2011 and 30th June 2012 as shown below:

FINANCIAL STATEMENT FOR THE YEAR ENDING 30THJUNE,2011.

1. TRANSFERS TO DISTRICTS. Shs 4,869,568,653 was transferred to various chief administration officers under the LuweroRwenzori Development programme. The funds were in respect of districts interventions (grants), micro-projects support and monitoring and evaluation. However, shs.3, 460,496,584 was accounted for leaving a balance of shs.1, 409,072,069 not accounted for. OPM RESPONSE Its true it wasnt accounted for. The districts that had not accounted were notified in writing to account. Since then the 39 districts that received funds have submitted their accountabilities. COMMITTEE REMARK. OPM was told to provide documents to account for the1, 409,072,069. 2. COMPENSATIONS TO BOMB BLAST VICTIMS. 1bn was received by the office of the prime minister as a supplementary funding for compensating victims of the Kampala rugby club and Ethiopian village kabalagala bomb blasts. Only shs.794, 532,950 was advanced to the permanent secretary, ministry of internal affairs to effect the compensations. The records are missing. OPM RESPONSE. The prime ministers office didnt receive all the 1bn. Due to the way the principal accountant left office without handing over; the documents for accountability cant be traced. COMMITTEE REMARK Provide the list of those who were compensated and the details of how much each got. And also the names of the officers who dispersed the money to these people. 3. UNSUPPORTED STATUTORY REMITTANCES TO URA. Shs.1, 142,752,346 was deducted from various suppliers in respect of WHT and remitted to URA was not supported with URA acknowledgement receipts and tax credit certificates.

OPM RESPONSE. By the time of audit, OPM had not been connected to the URA certificate on-line printing system. But now its connected and copies are available for verification. COMMITTEE REMARK The members asked OPM to prove the matrix of these suppliers and also the receipts from URA. 4. OPM CORE FUNCTION. OPM has taken up a multitude of functions that could either be performed by other ministries, departments and agencies hence creating a duplication of services. OPM RESPONSE. The mandate of OPM as stated under article 108A of the constitution includes performing such other functions as may be assigned, this too is core in addition to the coordination of government business function. COMMITTEE REMARK. Stick to the core functions of your ministry. 5. UNAUTHORIZED TRANSFERS TO UGANDA BROADCASTING CORPORATION (UBC). Parliament appropriated Shs.1bn as subvention to UBC. However, shs.1, 569,644,554 was paid to UBC resulting into shs. 569,644,554 transferred in excess of the appropriation without relevant authority. OPM RESPONSE. The excess shs.569, 644, 554 was frontloaded to UBC to cater for gratuity of staff and setup of baruuli radio station. However of this amount, shs.210m was a presidential directive for the establishment of this radio. COMMITTEE REMARKS. This is a tribal radio, give it a non-tribal name. This radio is not for the government; provide the registration certificate of this radio. 6. NORTHERN UGANDA SOCIAL ACTION FUND ( NUSAF 2) 6.1 DEMARCATION, PARTITION AND MINOR REPAIRS OF OFFICES. OPM spent shs.60, 079,700 on these offices 8th floor of postal building. This implies that the expenditure was charged to this project without authority and was not provided with satisfactory and verifiable evidence to confirm work done.

OPM RESPONSE. The mischarge was an error and is highly regretted. The funds were refunded by OPM to NUSAF 2and evidence is there. COMMITTEE REMARKS. The committee dropped the query. 6.2 REFUND OF START UP ACTIVITIES MONIES TO POST WAR RECOVERY AND PRESIDENTIAL PLEDGES ACCOUNT. A refund of shs.210, 193,000 used on startup activities for NUSAF 2 project was transferred to peace recovery and development plan (PRDP). Payment vouchers were not given. OPM RESPONSE. The accountability documents cannot be traced. However the office is committed to refunding this money before close of this financial year. COMMITTEE REMARKS. Provide this evidence in a weeks time.

FINANCIAL STATEMENT FOR THE YEAR ENDING 30THJUNE, 2012. 1. ABSENCE OF OPM ACCOUNTING RECORDS. The accounting records necessary to undertake the audit were not provided. OPM RESPONSE. The head of accounts is supposed to ensure proper custody of the accounting records of the entity. Mr.Kazinda Geoffrey former principal accountant was supposed to hand over to Mr. Mugumya Kenneth, the incumbent. The documents were taken by police. Management still awaits the outcome of the police investigation. COMMITTEE REMARKS. In case of such scenarios, you at least make photocopies. 2. ADVANCES TO CASHIERS PERSONAL ACCOUNT. Shs 2,087,703,998 was deposited onto the cashiers personal account in stanbic bank. Most of these transactions had a narration refund of funds to the cashier appearing as if the cashier had lent personal money to government.

OPM RESPONSE. These issues were raised in the forensic audit report and have been a subject of investigation by PAC and CIID. COMMITTEE REMARKS. This is still under investigation. 3. PAYMENT TO A FIRM OF CONSULTANTS. Shs.414, 687,497 was paid to IDC firm for preparation of public sector management strategic investment plan. The contract price including the variation and VAT stood at $836,855.41. This clearly shows an overpayment. OPM RESPONSE. IDC had 2 contracts with OPM running concurrently; Development of a National Initiative for Performance Monitoring Enhancement and public sector strategic investment plan. The amount referred to as over payment (shs 320,993,850) was a different contract from what the auditor general analyzed. COMMITTEE REMARKS. Provide a copy of adverts made to get to this firm. 4. KASIIMO PROJECT. The ministry through the department of luweero affairs was charged with the mandate of paying gratuity to non-combatant war (civil) veterans. The accounting officer should reconcile the amounts remitted to the bank as well as what is paid out to the beneficiaries. OPM RESPONSE. Currently reconciliations are done and subsequent disbursement sechedules and details of payments are available. As at December 2013, 15,582 beneficiaries had been paid to a tune of 33bn. COMMITTEE REMARKS. Provide documents showing criteria of selecting the beneficiaries. 5. LUWEERO RWENZORI PROJECT. The ministry under luweero/rwenzori project, embarked on prosperity for all projects in war ravaged areas of luweero and rwenzori regions. The main objective was to improve household income for these people through SACCOs and transfer of funds to districts. Funds should be given to groups with proper project proposals, unaccounted for funds should be followed up, funds should be sent straight to the districts by treasury on OPM advice.

OPM RESPONSE. Sensitization has been intensified for the lower local governments about their role and responsibilities in implementing LRDP to avoid gaps that had been identified at district level.

COMMITTEE REMARKS. No comment 6. UTILITIES. OPM entered into a tenancy agreement with M/S Posta Uganda for rental of 8th floor on postal building. The agreement stipulated that utilities were to be paid by the tenant. OPM paid the utilities; water, shs.111, 816,524 and electricity shs.75, 544,033. OPM RESPONSE. Management held negotiations with postal Uganda and an agreement was reached for the landlord to clear the utility bills paid by OPM. COMMITTEE REMARKS. Issue was finally resolved. 7. OVERVIEW OF OPM PROJECTS. A review of the different activities undertaken by the different projects revealed that in a number of instances the projects undertook the same activities, creating a risk of duplication. Like ALREP, KIDDP, KALIP all deal with construction of valley dams, market sheds and cattle crushes. KIDDP, post war recovery and presidential pledges deal with procurement of ox ploughs. OPM RESPONSE. The projects are not duplication in the operation areas. They are complimentary and the interventions are integrated in the district development plans. Through the use of Geographical Information System (GIS) we are able to track where NUSAF, ALREP,KALIP AND PRDP projects are located. COMMITTEE REMARKS. Who are the beneficiaries of these ox ploughs, provide a list. 8. ADVANCES TO INDIVIDUAL PERSONAL ACCOUNTS SHS.297, 938,500. It was noted that officers were advanced funds onto their personal accounts amounting to shs.297, 938,500 for field operations. Management in response said its done for official activities.

OPM RESPONSE. These activities involved payment of personal allowances for the officer, fuel for activities in areas where there are no advantage card systems, funds needed for field operations like parking and cleaning vehicles. The activities are coordinated by the requisitioning officer who compiles and submits. Accountabilities not accessed by auditor general are now available. COMMITTEE REMARKS. Provide the supporting documents. 9. IRREGULARITY IN THE PROCUREMENT OF HEIFERS IN NEBBI DISTRICT. Nebbi district entered into an agreement with a company to procure pure or cross breed heifers and bulls for milk production. However, it was noted that the supplier delivered local heifers instead of the exotic type. OPM RESPONSE. The chief administrative officer-Nebbi district did a good job by halting the payment to the supplier, guiding the community and ensuring that the supplier complied with NUSAF 2 guidelines. However, the supplier decided to sue the community project management committee. The district has applied for dismissal of the case. COMMITTEE RESPONSE. Going to follow up this issue. 10. DELAYED DRAINAGE WORKS IN BARDEGE DIVISION GULU MUNICIPALITY. The drainage works were identified and approved for funding in Bar-Dege dividion. It was however noted that the sub-project implementation did not take off despite the funds being approved for the purpose. OPM RESPONSE. This issue was under investigation by the IGG from November 2011. The IGG concluded on its findings in December 2012 and recommended that gulu district returns the grant to OPM. COMMITTEE REMARKS. Provide the supporting documents. 11. DELAYED IMPLEMENTATION OF SUB PROJECTS IN AMURU DISTRICT. For almost 2 years amuru district has made a nil disbursement to sub projects despite the memorandum of understanding between OPM and Amuru local district that was signed for the execution of the approved 258 projects. The district community has not benefited from the intended services.

OPM RESPONSE. Sub project generation began in Amuru district when the prolonged investigation by IGG was lifted on 25th oct, 2011. To-date a total of 186 projects has been disbursed to the communities and accounted for accordingly. COMMITTEE REMARKS. Provide evidence to back this up. 12. STRENGTHENING EVIDENCE BASED DECISION MAKING PROJECT-OPM. COMPONENT 2011-12. 1. VALUE ADDED TAX The grant was not meant to be used to meet the costs of other duties or taxes, fees or similar charges imposed directly or indirectly by the government of Uganda. OPM RESPONSE. The matter has been brought to the attention of the ministry of finance, planning and economic development. COMMITTEE REMARKS. Stand over the query. 2. BORROWING FOR BARAZA ACTIVITIES. Shs.500, 617,316 meant to be incurred from government funding for these activities was financed using DFID funds. OPM RESPONSE. The shs. 500,617,316 is part of the refund that was effected on 6/8/2012 on the DFID account totaling to shs.2, 397,716,250. COMMITTEE REMARKS. Provide the list of all baraza activities. 3. UNBUDGETED ITEMS. The total expenditure for the period under the monitoring budget line included expenditures that related to SEBDEM 1. OPM RESPONSE. SEBDEM 1 had insufficient funds and it couldnt pay the contractors. These were subsequently catered for using funds from SEBDEM 11. COMMITTEE REMARKS. stick to the budget plan.

4. INELIGIBLE EXPENDITURE-SALARIES FOR PRDP SHS.48, 945,278. SEDBEM 11 paid salaries worth shs. 48,945,278 for peace recovery development program for the month of April 2012 without following proper procedures. OPM RESPONSE. The shs 48,945,278 is part of the refund that was effected on 6/8/2012 on the DFID account totaling to shs.2, 397,716,250.

COMMITTEE REMARKS. Provide evidence to back this up.