The Independent Uganda: You get the Truth we Pay the Price
Ministry of Energy officials argue that they are the ones that entered the contract with the contractor; China’s Synohydro and therefore, should be the rightful supervisors of the project.
On the other hand, UEGCL officials argue that they entered a MoU with the Energy and Finance Ministries, which made them the implementing agency. Apart from this, the loan being used to construct the dams is on UEGCL’s books meaning that it is them who will have to repay and not the Energy Ministry.
“We cannot guarantee an affordable tariff if we are not directly involved in the supervision of the construction process because if there are shoddy works it means we will have to do a lot of repairs and in turn this will mean a higher tariff,” an official at UEGCL told “That beats the whole essence of why government is using own money to build these dams.”
Behind the scenes, however, the tussle is over who controls the trillions of shillings surrounding the project. The Independent understands, for instance, that some of the lucrative deals for officials are in supplying the contractors with construction materials like cement, stones, among others.
Because government has not been strict enough on the Chinese companies and has not set terms on local content, critics say, the Chinese contractors are reportedly handing the lucrative deals to fellow Chinese companies.
In one case, one of the contractors is said to have awarded a Chinese company the deal to supply cement. So, the Chinese company in question buys from Hima Cement and the then resells at a higher price to the contractor. In another case, it is a Chinese company supplying hard core stones used in the construction. Given the circumstances, therefore, it is those with leverage like government officials overseeing the project, who are able to get a piece of the business.
Kaliisa defies Muhakanizi
It is against this background that UEGCL lobbied President Museveni to intervene in March this year. In his first letter Museveni notified the Energy Minister about the shoddy works by Chinese contractor, Synohydro and the project supervisors or Owners Engineer, India’s Energy Infratech.
Museveni followed his alert with another missive on April 05 in which he made a number of directives. Energy Ministry officials only partially implemented Museveni’s core directives.
“I am writing in reference to the above subject matter and the directives I issued to you via my letter of 5th April, 2016,” Museveni writes in his latest letter, “In that letter, a number of directives were issued which included but not limited to: change of the Owners Engineer’s key project personnel, that is, Project Managers and their deputies on both projects; constitution and operationalisation of the Projects Steering Committee (PSC) and transfer of FULL projects contract administration powers to UEGCL.”
“I am also aware,” Museveni writes in his July 23 letter, “that my directive in regard to the replacement of the Owners engineer’s key project personnel on both projects has not been implemented; I demand that the ministry asks the Owners Engineer to withdraw his current key project personnel from both projects and deploy personnel with requisite experience as those who were proposed at the bidding stage.”
The Independent could not confirm reports that following the letter, the two officials in question were relieved of their duties by Energy Infratech.
Observers find it strange that the two officials are just leaving when President Museveni raised concerns about them in April. Museveni was not the first official to raise these concerns.
Museveni noted that he was aware of the steps the ministry was taking to implement “my directive in regards to the transfer of the full project contract administration powers but I insist that this process of transfer should be done as expeditiously and legally as possible”.
He said that the legal opinion of the Solicitor General should be properly followed.
Museveni was referring to a May 26 letter in which Director Legal Services, Christopher Gashirabake, acting on behalf of the Solicitor General, gave a legal opinion to resolve an impasse over Karuma.
Gashirabake’s opinion was solicited by Kabagambe Kaliisa after a disagreement with the Secretary to the Treasury, Keith Muhakanizi.
Following Museveni’s directive, Energy Minister, Muloni wrote to UEGCL in a policy directive noting that the contracts were signed by the Energy Ministry on behalf of government and that UEGCL and the transmission arm—UETCL—were only witnesses to the contract.
In effect, Muloni informed UEGCL that the Energy Ministry would remain the overall implementer of the power dam contracts with UEGCL playing a peripheral role.
Not satisfied with the minister’s directives, Stephen Isabalija, the UEGCL board chairman, on April 21, nineteen days after Museveni’s directive, wrote to Minister Irene Muloni, asking why she had not addressed the president’s directive.
In the letter, Isabalija copied in, the Vice President; Prime Minister, the Inspector General of Police, the Permanent Secretary Minister of Finance and the Attorney General.
