The former State Minister for mineral development, Kamanda Bataringaya has admitted that he approved the Umeme loses threshold at 38%, over and above the 33% recommended by his boss at the time, Daudi Migereko.
In a letter dated November 28, 2006 a copy of which URN has seen, Bataringaya writes to the then Minister of Finance Ezra Suruma on behalf of Migereko, expressing no objection at the amendments accepting the threshold to be put at 38%.
He notes that the no objection was granted after having been satisfied that the losses and collection threshold were not the regulatory targets of performance for Umeme, but rather a mechanism of capping the government compensation on increasing losses and reduced collections on billing.
For every percentage loss over and above 28%, government has been compensating Umeme 5 million US Dollars per year. This is why MPs investigating the energy sector fault the Ministry of Energy for not explaining the factors that informed the decision to raise the losses threshold.
The minister was also satisfied on the progress made in resolving the impediments of the implementation of the rural electrification schemes, for which a workable framework would be in place by December 2006.
But upon interrogation on Wednesday by lawmakers on the ad hoc committee on energy, Bataringaya revealed that he only appended the signature on the letter from the Permanent Secretary’s department. He was cornered after MPs realized that departments in the Ministry of Energy use different letter heads for communication. This particular letter originated from the office of Kabagambe Kaliisa, the PS and chair of the eminent persons that approved the losses threshold.
The MPs found it fishy that the committee of eminent persons sat and approved the losses when the substantive Minister, Daudi Migereko had left the country for other state duties. Before his departure, Migereko communicated that the current threshold for loss reduction was set at 33% and that of the collection rates was revised from 20% to 10%.
But his directive was ignored by the PS who convened a meeting and set a new threshold. The PS has since failed to explain to the committee how the threshold was arrived at.
