What is in the COSASE report on Uganda Airlines that has been trashed by Parliament?

This week, Speaker of Parliament Anita Among, dealt a big blow to the most popular oversight and accountability committee of Parliament, the Committee on Commissions, Statutory Authorities and State Enterprises (COSASE) when she ruled that its report on the operations of the Uganda Airlines will not be debated and adopted by Parliament.

This, the Speaker said, was because the report was leaked to the media late last year before it could be allocated space on the Order Paper. The COSASE like other accountability committees is chaired by a member of the opposition. The current chairperson is Joel Ssenyonyi of Nakawa West on National Unity Platform (NUP) ticket and is deputized by Amuru District Woman MP Lucy Akello of the Forum for Democratic Change (FDC).

Speaker Among, in a heated exchange with Ssenyonyi during Wednesday’s plenary sitting, wrapped the COSASE for failing to execute its mandate of processing Auditor General’s report on 102 out of the 107 public entities assigned to it. She said that it was a shame that a committee led by the opposition has failed to check the government entities in the six months mandated by Article 163(5) of the Constitution.

 “I can’t say shame on the House; it is shame on you COSASE. You get money like other committees to do your work. Article 163 (5) of the Constitution gives this House six months to complete the reports.  As opposition, your work is to check the (political) party in power. Then if you are not checking these people, what are we doing?” the Speaker asked before directing the Office of the Auditor General to carry out a value for money audit on the committee.

Ssenyonyi who was presenting his committee’s fifth completed report in the last six months, asked the Speaker for guidance on what he should do to the report on Uganda Airlines that has been ready since November last year.

And this was the Speaker’s response; ““There was a problem with the Uganda Airlines where we ruled on the report. We will take the report that was presented by the Auditor General. We are still investigating who leaked (the report) and as you are aware our staff who were working with you are on disciplinary probation.”

Ssenyonyi who is also the spokesperson of the NUP party has since taken the fight on social media accusing the Speaker of “bluffing” after shielding the rot in the company running the national flag carrier from being debated as exposed in the report.

“May be the person who should be investigated is the Speaker of Parliament, Anita Among. The Speaker has decided to sit on this report to protect the thieves in Uganda Airlines” Ssenyonyi is quoted on Twitter.

On Thursday, Chris Obore, the Parliament’s Director for Communication and Public Affairs confirmed that a value for money audit will be conducted on the COSASE committee saying its output has been found wanting because of performance that is below that of the Public Accounts Committee (Central Government) and Public Accounts Committee (Local Governments).

Obore said that the COSASE chairperson should not go out on social media to blame the leadership of Parliament for failing the committee, because its sister committees, PAC-Central and PAC-Local Government have done a commendable job. In his statement, Obore noted that PAC-Central Government chaired by NUP’s Medard Lubega Ssegona has produced 35 reports while PAC-Local Government chaired by Independent Martins Ojara Mapenduzi has produced 87 reports in the last one and a half years.

“The accusation (by Ssenyonyi) came after the Speaker, Anita Among, ordered for a value for money audit on COSASE following what she termed ‘a failure’ on the part of the committee to produce reports, which she said was also an indictment on the House” reads part of the statement.

He added that the Speaker’s concerns about the performance of the committee “arise from a comparative analysis” of the performance of the accountability committees of Parliament since May 2021.

What is in the report?

As a matter of fact, like other reports in the past, the COSASE report on operations of the Uganda Airlines leaked after more than two months grilling of the company officials led by Chief Executive Officer, Jennifer Bamuturaki.

Much of the time the legislators spent on the probe focused on the person of Bamuturaki especially about her academic documents, something that dragged in the management of Makerere University where she said had graduated about 20 years ago and was reportedly undergoing a Master’s Degree programme.

However, when the report was signed and leaked, the content did not dwell much on the person of the CEO other than queries directed to her role in a number of anomalies as presented in the Auditor General’s report for the year ending June 2021.  During the year under review, Bamuturaki had not yet raised the ranks to CEO.

Auditor General, John Muwanga in his report informed Parliament that there were a number of queries about the operations of the Airline. Most of the queries were on the unsupported payables, direct procurements, and failure to avail proper records of equipment purchased for the service of the aircrafts. 

The airline operates six jets which include four Bombardier CRJ 900 that fly to regional destinations and two Airbus A330-800 planes which are for long-haul flights.

Legislators recommended Parliament to order for a number of forensic audits in order to reach the conclusion on a number of procurements that management of the Airline could not explain at the time of the probe.

Forensic audits

After observing that there were no supporting documents furnished with neither the Auditors nor the Committee in regard to the procurement of in-flight service equipment for Airbus aircrafts, the lawmakers want a deeper investigation through forensic audit. The equipment worth $319,226.86 (about Sh1.2b) was procured through a contracted service provider, M/s Ninesun Manufacturing Limited and management had informed the auditors that the consignment was delivered to DAS Air but there was no evidence that they were received, witnessed for quality and quantity and the handed over to DAS Air stores.

“The unclear terms and conditions in the procurement supplies/contracts pose a risk that the items were not supplied and that they may go missing without accountability in case they were supplied due to lack of a tenancy agreement with DAS Air for storage of Uganda Airlines equipment. The Auditor General should carry out a special audit into the purchase of the said equipment” reads part of the report.

The report which has been on the Order Paper since last week but is yet to be presented for debate and adoption, also recommends that management of the Airline needs to enter a formal tenancy agreement with DAS Air which does ground handling at Entebbe International Airport.

Another forensic audit the MPs want contacted by the Office of the Auditor General is about the procurement of critical spare parts for Business Class seats for A330-800 Neo aircraft at $146,230.72 (about Sh555.7m) but there was no evidence provided to the Auditors by management.

While appearing before the COSASE, UNACL Management team led by Bamuturaki responded that the purchase of the critical spare parts was already pre-determined at the contract signing between the Airline and Airbus and were delivered through a company called Stelia.

The lawmakers also want a further forensic audit to be conducted on the 20 procurements that were found to have been done without the evidence of contract management files. The Auditor General queried why the 20 procurements he sampled were done without appointment of contract managers. Some of these procurements were also made in different currencies including Uganda Shillings, Kenya Shillings, US dollars and Euros.

The report notes that the management of the Airline during the prove “acknowledged the anomaly” which is contrary to Regulation 52(2) of the Procurement and Disposal of Public Assets (PPDA) contracts regulations.

“Failure to appoint a contract manager and absence of contracts management files implies that this particular procurement is shrouded in mystery. It is therefore difficult to assess the performance of the contract or whether there was value for money. The Accounting Officer should be held liable for failure to follow the law on procurement” adds the report.

Having observed that there have been cases of void tickets being reused for travel aboard Uganda Airlines aircrafts, the MPs also want another forensic audit with the intention of prosecuting culpable officers and forcing them to return the lost funds. It was observed that there was an internal syndicate among staff to defraud the Airline by not closing tickets that have already been flown on so that passengers can use them again. Tickets worth Sh982m were voided and the money is missing in the reported revenues.

Call for refunds

For failure to explain the queries before the Committee, the Accounting Officer, Bamuraki and other managers were not spared by the recommendations of the COSASE which wants the House to order a refund of money spent on different outputs that lacked documentation at the time of the audit and the probe in Parliament.

The MPs want Bamuturaki to refund with immediate effect Sh50m she received for trips to destinations where the Airline flies but only visited two out of about seven. When she appeared before the Committee, she could not verbally explain why she did not return the money to the company treasury and also never delivered a written explanation as requested.

“The committee observes that no refund has been made to-date for the funds allocated for the destinations that the CEO did not visit. It is criminal for a public official to receive funds for a certain activity and the activity doesn’t happen, and the funds don’t get refunded” the Committee observed.

Bamuturaki is also held liable for causing a financial loss of Sh156m that was spent on online bloggers hired to do public relations stories for the Airline. The bloggers under the Independent Online Journalists Association (INDOJA) had been hired at a monthly consideration of Sh13m. The contract was signed between Bamuturaki while serving as a Commercial Manager and Andrew Irumba the head of the online publication, Spy-Uganda on December 24, 2021. This, the Committee observed, was done without the knowledge of the Corporation Secretary.

The CEO’s troubles in this case stem from her sanctioning of payment of Sh117m upfront to the online bloggers for the period of April to December 2021 yet the contract was signed in December 2021.

Ssenyonyi’s COSASE observed that the responsibility for marketing the Airline sat with the Public Relations Manager, Shakila Rahim Lamar who distanced herself from participating in the procurement of the online bloggers.

“Jennifer Bamuturaki should be held responsible for this irregular contract, and she should refund the Sh156m that was spent on the online bloggers” it is recommended.

Conwell Muleya the former CEO who is battling corruption charges has also not been left off the hook by COSASE which wants him to be held personally liable for sanctioning procurements without contracts committee approval.

Muleya, a Zambian national on December 14, 2020 sanctioned a Purchase Order number 0021 that was made to Collins Aerospace for the supply of in-flight equipment at $25,694 without approval of the contracts committee.

It is understood that the Inspectorate of Government is also investigating the direct procurement of a vehicle for the South Sudan station at Sh103m. The MPs who rejected the explanation of the management team about the direct procurement have argued the IGG to expedite the investigations so that those involved are punished and also made to make good of the loss that might have been made in fluctuating the price of the car.

Financial losses

The national carrier has been in the news for posting a financial loss of about Sh500m in its first year of operations. The management has attributed the losses by the young Airline to the advance effects of the Covid-19 pandemic. But the MPs said it is irregular to blame the initial losses on Covid-19 but also lack of functional management systems at the inception of the company.

In order to avoid losses going forward, the Committee recommended the establishment of strong partnerships, opening more routes, review of the business strategies, establishing performance indicators and targets to staff, and, carrying out cost reduction strategies.

Now, the contents of this report will not be presented, debated and adopted by the House because the Speaker has ruled that what will be adopted are the findings of the Auditor General on Uganda Airlines and other 102 entities that COSASE failed to investigate.

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