A January 27, 2021 dossier to President Museveni by the national carrier has given a sneak peek into the storm that is brewing within Uganda Airlines.
The brief prepared by the CEO, Cornwell Muleya claims that none of the board members of Uganda Airlines has any aviation background although this has been defended by the airline as not being a major problem.
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"Whereas this is true that none of the board members have an aviation background, management has taken the board through a comprehensive induction program to ensure they are properly oriented into the specialties of the airline industry so that they can appreciate the issues facing the company and the experience and skills required to oversee a successful airline," the brief says.
The brief to the president indicates that despite being novices, the board members are now in a better position to understand the workings of the aviation industry than they were at the start.
Interference
The bigger issue, according to the brief, is the matter of interference in the management of Uganda Airlines which has in one way or the other affected the national carrier as the report paints a gloomy picture of the dealings in the airline.
The report cites some board members who push for their own promotions for selfish reasons instead of safeguarding the interest of the airline.
“This unhealthy practice has led them into trying to interfere in management areas especially in the areas of procurement and staff recruitment in the airline,” the report says.
According to the report, some board members have on several occasions met with some members of the management team to inflate invoices in a bid to make money out of the airline and that this has led to division among the management team as well as inefficiency in the management of the airline.
The report indicates that managers working with backing from some of the board members to inflate invoices have on several occasions to slow down some of the airline projects as they push their own selfish agendas with protection from the “godfathers” on the board.
“These schemes have only been prevented by the strong stand of the Accounting Officer to ensure company interests come first.”
The report cites procurement managers who have worked with some people in government ministries to find ways of making money from the airline.
According to the brief to President Museveni, whereas the airline CEO was on a six-month interim contract until February 2020, he worked with an expired work permit for a period of one and half years until September 14, 2020 when a new permit was finally issued to him.
The report indicates that some board members view the CEO as being too rigid and not flexible on the issue of corruption as people find it hard to work with him.
“They advised that I must try to understand how business is done in Uganda because these practices are normal in this country, otherwise I will find myself alone. They have gone so far as to suggest that our ethical approach management may be one of the reasons why we are experiencing delays in the release of company project funds from the ministries within government.”
According to the Uganda Airlines CEO, it has been told him directly in the face that many projects have failed to take off because he has refused to give kickbacks to some government officials to give a green light to the projects.
Auditors
The CEO says that when the Ministry of Works and Transport auditors came to perform audit reviews of the airline, he was informed by some of his staff that they demanded US$50,000 in order to “give a good report on the airline.”
He adds that auditors from the office of the Auditor-General demanded for an amount in the region of shs100 million and shs150 million to give a good report on the airline.
“These incidents have highlighted the mammoth task ahead of management to protect the company from these destructive practices.”
The report indicates that some people both within and outside the airline is working to ensure the project suffers a stillbirth if their personal agendas are not satisfied.
Debts
The report indicates that in 2019, the airline contracted services of Abbavater as its publicity and promotions agency to design and perform sales and marketing activities but little did they know that the Commercial Director then had connections in the company yet it was under her department to supervise it.
“When the company was contracted to do this work, management was not aware that some of the managers within the airline, including the Commercial Director whose duty it was to manage this service, had intimate connections with this company. •This only came to light after the agency’s services to the airline were found to be below par to a point where management had to recommend to the board to terminate their contract.”
The report indicates that investigations found out that the agency had either bribed its way into the airline or attempted to bribe some managers in order to get the contract.
“Apart from the poor performance on marketing activities, the company had issues of over-invoicing, non-payment of subcontracted media houses and other suppliers for services arranged even without permission from the airline accounting officer at the time.”
It is reported that the agency contract suppliers under authority of the then Commercial Director and that despite submitting claims to the airline and being paid for the costs of the sub-contracted parties, the monies didn’t reach the intended suppliers who have since gone to court demanding for their money.
The report says at one time there was approval of payment of US$232,000(Shs 1.48bn) to the agency yet the actual cost was US$172000(Shs631.2million).
It is said that after its contract was terminated, the agency became a thorn in the feet of the Uganda Airlines after starting a campaign aimed at tarnishing its name all over the internet.
According to the report, the Airline has arrears worth shs 133.3 billion since 2019 to date yet government only allocated shs117.6billion in the 2021/2022 budget leaving the national carrier with a shs117.6 billion shortfall.
The latest developments confirm some of the revelations made earlier by some of the suppliers to the Uganda Airlines who have never been paid despite offering services to the national carrier.
