Billions vanish in shady government deals

An analysis of the latest report by the Office of the Auditor General, which covers the period ending December 2016, revealed that many of these departments spent billions of shillings without providing proof of accountability.

rnIn the absence of documents to support some expenditures in the government ministries and departments, there is genuine fear that some of this money could have been swindled.

Under the law, the auditor general is mandated to audit the books of government ministries, departments, agencies, authorities or private institutions in which government has a stake.

Ministry of Worksrn

rnAccording to the latest report Shs 10 billion was paid by the ministry of Works and Transport to several companies for settlement of arrears incurred in the previous financial years without any budget provision.

The auditor general says this was contrary to paragraph 188 Part 1 of the Treasury Accounting Instructions 2003 that requires an officer authorized to incur expenditure to ensure that no payments due in any financial year remain unpaid at the end of that year.

“Under the circumstances, the payments for settlement of domestic arrears were not appropriately charged and there is a risk that funds which were released for otherrnactivities planned by the Ministry were diverted to settle these arrears,” the report noted.

The auditor general also has issues with Shs 2.7 billion as payment of the quarterly consolidated allowances to all staff in 2016. Some of this money constitutes “night allowance” and is not supported by documentary evidence.

The report notes: “There were no activity reports for work schedules undertaken outside the station and thus the payments were not backed with any administrative circulars/standing order instructions approved by the Ministry of Public Service.”

Ministry of Internal Affairs

The auditor general’s report reveals that the ministry of Internal Affairs spent Shs 22.5 million on a single trip of ministers to Nairobi in October 2015.

This was not one of the ministry’s planned activities according to the work plan.

“I advised the Accounting Officer to always seek for authority where reallocation of funds is required. Meanwhile 22,543,820 should be refunded,” the auditor general stated.

rnMinistry of Local Governmentrn

According to the auditor general, the ministry of Local Government diverted Shs 3.5 billion to fund projects that were not under its docket.

The report states: “Such a practice undermines the intentions of the appropriating Authority, results into under-performance on the part of the project and leads to misstatement of financial statements.”

The management, according to the report, explained that the funds were used for clearing taxes for the motor vehicles procured by the ministry for the district chairpersons but the auditor general advised the accounting officers to refund the diverted funds.

Police

The report questioned Shs 296 million which was paid out to pensioners, who once served in the Uganda Police Force without verifying their life certificates to confirm whether they are alive.

The auditor general advised police management to obtain a reconciliation of pensioners that are alive and ensure that only eligible pensioners are paid.rn

“In the absence of proper justification, the payments were ineligible and may lead to loss of funds,” notes part of the report.rn

Ministry of Public Servicern

The auditor general questions the $4 million (14.4 billion) that government paid to two unnamed firms for the supply, installation, design, and implementation and commissioning of the Integrated Personnel and Payroll System (IPPS).

According to the report, the system failed to work and government is in the process of decommissioning it. the auditor general revealed that a review of employee records within the IPPS revealed major errors in the data being maintained on the system.

The report noted that errors existed in the category of service, age, years of employment.

A case in point is the fact that out of 130,331 traditional civil servants, a total of 28,562 are indicated as still on probation. There are employees on the system who have worked for 96 years, while others are 120 years old but still in active service.rn

The report says the IPPS was a blatant case of wastage of taxpayers’ money.

“The performance appears dismal and it is apparent that value for money has not been fully attained. The impending decommissioning implies a waste of financial resources since the system is being shelved before full implementation despite its huge cost to government. This can be attributed to poor feasibility studies and contract management,” the report notes.rn

Ministry of Defence

Turning to the ministry of Defence, the report reveals that on July 11, 2015, it paid cash amounting to Shs 389 million to an account in a local bank in the names of a supplier to procure 100,000 litres of fuel.

The report noted that there was no justification why the ministry paid cash instead of wiring the money through EFT.

rn“Besides, there was no evidence to confirm delivery of 100,000 litres of fuel. I was also not provided with documentation to enable me confirm that the fuel was delivered at the ministryrnPremises,” the report noted.rn

In response, the accounting officer told the auditor general that the ministry required the fuel to undertake urgent operations.

He said the other suppliers were not willing to provide this fuel on credit as the ministry’s indebtedness had surpassed the credit limit.

The only option was to make a deposit on the supplier account to necessitate delivery of 100,000 litres of fuel.