OIL: Museveni talks tough on presidential handshake money

Whoever breached the law in the six billion shilling oil cash payout must face the law – Museveni

The chairperson of Uganda’s  parliamentary Committee on Commissions, Statutory Authorities and State Enterprises (COSASE)  Abdu Katuntu has said President Yoweri Museveni wants the solicitor General to account for sh5.6 billion supposed to have been spent on recent oil cases.

Katuntu was briefing journalists at Parliament Friday on the two meetings the committee held with Museveni this week over the sh6 billion “Presidential Handshake” he awarded 42 government officials who handled the Heritage oil case. Parliament speaker Rebecca Kadaga early this year ordered a probe on the rewards to various government officials after the case was concluded.

Katuntu said the committee and the president also agreed on a number of key areas which includes investigating other aspects of abuse of public funds in the presidential handshake.

According to Katuntu, the president admitted that it was wrong that the “Presidential Handshake” money was deducted from the Uganda Revenue Authority (URA) accounts without the knowledge of its board and that this money should be deducted from his budget for donations to the URA accounts.

Uganda has never collected its $4 million

Katuntu added that though Uganda won the case, the government has never collected the $4 million awarded in costs to date and that the Solicitor General Francis Atoke has to account for the 5.6 billion shillings that was allocated to facilitate the case for three years.

“The president said whether they solicited or not, he is the one who gave it to them. He neither said they solicited or not. However, he owned the contents of the letter which he had written that said they had requested for it”, said Katuntu.

The president also wants the committee to investigate how petroleum revenues have been used especially the Road and energy fund.

Committee to investigate Syda Bbumba

Katuntu said that as the committee concludes it’s work, the members will also interact with the former Energy minister, Syda Namirembe Bbumba who reportedly gave a tax waiver to oil companies in an irregular money.

Katuntu said the Nakaseke North MP who was then Energy minister will explain herself on why she exempted Tullow Oil from paying capital gains tax yet she didn’t have the power.

“We discussed the tax exemption in detail and the president said Bbumba did not consult him. He agreed with us that the tax exemption was illegal because the minister did not have the power to exempt payment of tax”, said Katuntu.

New policy on rewards due

Katuntu also said the committee had a lengthy discussion with the president on the need for a clear policy on rewards and donations.

He said the president agreed that there is need to enact a law to regulate rewards and donations because the presidential handshake was not done in accordance with existing laws.

“The law in place we brought to his attention was the national awards act and the standing orders and we told him that this payment was not made in accordance with the 2 laws,” stated Mr.Katuntu, adding that “we asked the president whether he was comfortable with us enacting a law and he agreed with us. Hence,directing the attorney general to work with us to come up with a law to regulate rewards and donations.”

History of oil probe

COSASE on January 24, 2017 begun investigations into the circumstances under which monetary rewards worth sh6 billion was made to public officers for winning the Tax arbitration case between the government of Uganda and Heritage Oil and Gas.

The Committee insists that there is no legal basis to the payout and vowed to ‘leave no stone’ unturned and has since has called each beneficiary before the committee will to explain their role.

A list of individuals have been invited and these include the Attorney General William Byaruhanga, the Auditor General John Muwanga, the solicitor General Francis Atoke, the Ministry of Energy, the Head of Public Service, Members of the Board, the Director Budget Ministry of Finance, Planning and Economic Development, the Governor Bank of Uganda, the Minister of Finance among others explained have explained their roles.

In July 2010, Heritage Oil and Gas sold its assets in Uganda to Tullow Oil for US$1.5Bn, upon which the URA issued the parties a tax bill of US$ 434million. In May 2011, Heritage Oil and Gas initiated arbitration proceedings against the government of Uganda for the release of, among other things US$ 405M held by the URA following the scale of interests in oil blocks 1and 3A in Uganda in July 2010.

The case against Heritage Oil and Gas was decided in Uganda’s favour and therefore upheld URA’s assessment of US$ 434 million as Capital Gains tax.