The Auditor General's 2024 report has issued a stark warning regarding the state of government procurement processes, citing multiple instances of poor planning, lack of transparency, and accountability.
These issues could lead to a significant financial burden, exacerbating Uganda's already precarious domestic arrears.
The report, which sampled 72 entities, reveals that 11 of these (15%) engaged in 63 unplanned procurements worth Shs59.02 billion.
These unapproved procurement actions not only risk exceeding procurement budgets but also threaten to create more domestic arrears, further complicating Uganda’s fiscal management.
While accounting officers attempted to justify the unplanned procurements by stating that they were initiated in prior periods but only completed in the current year, this lack of foresight highlights serious flaws in budgeting and planning.
A more concerning issue, as noted in the Auditor General's report, is the splitting of 19 procurements worth Shs2.40 billion across five entities, a practice that violated the PPDA (Public Procurement and Disposal of Public Assets) Regulations, 2023.
This splitting, often done to bypass procurement thresholds, raises the risk of collusion between suppliers, undermines fair competition, and prevents the government from benefiting from cost efficiencies that come with bulk purchasing.
The report also pointed to 21 procurements worth Shs42.79 billion in eight sampled entities that were initiated without proper authorization, such as approval from the Accounting Officer or confirmation of available funds.
Another troubling finding was that 13 entities procured goods and services worth Shs25.45 billion without obtaining market prices to support the estimated values of these procurements.
This lack of market research often results in the award of contracts at inflated or unreasonable prices, draining public resources unnecessarily.
Furthermore, delayed procurement processes have hindered timely service delivery and increased costs, with 79 procurements valued at Shs1.062 billion taking an average of six months from initiation to final contract signing.
Some of these delays were attributed to slow responses from various stakeholders during the procurement process, but the impact is nonetheless significant, leading to price fluctuations and potentially rendering projects incomplete.
The report also highlighted that 10 entities procured 44 contracts worth Shs47.13 billion without requiring performance security from contractors.
This omission exposes the entities to financial risk in the event that contractors fail to meet their obligations, potentially causing delays or halting projects altogether.
These findings raise questions about whether entities have fully embraced the e-government procurement system or are adhering to PPDA requirements.
The failure to follow procurement best practices and regulations not only jeopardizes the efficient use of public funds but also undermines the transparency and integrity of Uganda's procurement processes.
If these issues are not addressed, they could continue to compound Uganda’s financial challenges, creating a ticking time bomb that risks spiraling out of control.
The government must act swiftly to ensure that procurement procedures are followed strictly and that resources are allocated wisely for the benefit of the public.
