The Independent Uganda: You get the Truth we Pay the Price
Kampala, Uganda | THE INDEPENDENT | The Uganda Development Corporation-UDC, an agency of the government that promotes industrial development has protested accusations of mismanagement of Soroti fruit factory.
The protest follows a report on 2nd March 2022 by the Parliamentary Committee on Tourism, Trade and Industries implicating the entity of mismanagement, unfulfilled financial obligations, abuse of office and resources at the multibillion factory.
The findings resulted from of a visit by the lawmakers between 16-17 February after Jonathan Ebwalu, the Soroti City West Division MP petitioned the Parliament on February 8th, 2022 to investigate the factor of corruption and mismanagement.
Ebwalu accused UDC of inflating the cost of operation at the factory to defraud government. He cited the construction of the factory’s wall fence which cost 2.5 billion, and a kilometer-long access road at a staggering 5.5 billion.
But Dr Patrick Birungi, the Executive Director of UDC dismissed the claims saying the report is politically motivated, aims at discrediting and failing the investment in Teso. He refuted allegations that the entity was involved in the access road construction and also disputed the alleged amount of money Ebwalu attached to the engineering work.
Dr Birungi clarified that the road was constructed by the Uganda Investment Authority-UIA in partnership with a donation from the Korean International Corporation Agency-KOICA which jointly undertook the venture with the government and not UDC.
Led by Mwine Mpaka, the Mbarara City South Division MP, the Committee visited the factory and scrutinized the procurement documents and confirmed that the road and wall fence consumed 1.1 billion. They also observed that the contractor had done shoddy work which left the wall fence with cracks, a sinking foundation and plaster peeling off the wall.
While presenting the report to the House, Mwine further highlighted that the Committee also recorded several complaints about the exploitation of farmers by the factory management that has led to unprecedented wastage.
But Dr Birungi responded that during the peak of fruits harvesting seasons, the factory gets overwhelming supplies above what it can process leading to undue pressure, and called on the government to expand the factory’s capacity to meet the growing supply.
Farmers at Gweri sub-county in Soroti told the committee that Teso Farmers’ Co-operative Union – TEFCU buys from them double sack of oranges weighing about 120kgs for between 15,000-20,000 Shillings without weighing, and later sells the same quantity to the factory at 72,000 Shillings. But Dr Birungi said the allegation has never been brought to UDC.
The MPs also faulted UDC for delivering 240 poor quality motorized spray pumps worth 528 million to farmers, yet the Union fraudulently charged the farmers 200,000 for each pump. They recommended that the Union refund the farmers’ money or face prosecution for extortion.
In response, Dr Birungi said the famers have never complained to UDC because they agreed in principle with the Union leaders to contribute the money to help facilitate the distribution of the pumps across different sub-counties in Teso sub region.
The MPs were also bemused by the cost of public relations and advertisement of 722 million meant to generate annual sales of Shillings 818 million, about 60 million every month to generate 68 million, which Dr Birungi defended.
In August 2012, the Government represented by UDC together with Korea International Cooperation Agency – KOICA entered into a memorandum of understanding to invest in the factory, with KOICA injecting an initial 29.6 billion towards the establishment of the factory.
In the report, the committee was concerned that Government has so far invested in the factory a total of 44.1 billion, in addition to the KOICA grant of 29.6 billion, yet the venture has not yielded any profits, casting doubts on whether the factory may sustain itself.
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