Chinese Contractors Refund UGX 26.3bn

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In short
This morning, Abdu Katuntu, the COSASE Committee Chairperson, says they had had recovered Shillings 26.3 billion from the companies leaving a balance of Shillings 9.2bn, which is with China Railway No. 3 Group.

The Committee on Commissions, Statutory Authorities and State Enterprises-COSASE has recovered Shillings 26.3 billion from five Chinese contractors. The money is part of the Shillings 47.7 billion advanced to the Chinese firms by Uganda National Roads Authorities to Project Affected Persons - PAPs.


 
The firms include China Railway 18th Group Shillings, China Railway No.3 Group, Zhongmei Engineering, China Railway No.5 Group and Chongqing International Construction Company. The firms were contracted to undertake the construction of Musita-Lumino-Busia, Kanoni-Sembabule-Villa, Olwiyo Gulu, Gulu-Acholibur and Acholibur-Musingo respectively. 




On Tuesday, COSASE directed the Chinese contractors to refund the money after it emerged that they had fixed the money to earn interest. The committee also learnt that the contractors would invest part of the money in their personal businesses as they awaited payment instructions from UNRA.
 


 
The revelations forced the committee to freeze their accounts of the firms and ordered the contractors to transfer the money to UNRA's Kampala Station Account No. 9030006387976 in Stanbic Bank. This morning, Abdu Katuntu, the COSASE Committee Chairperson, says they had had recovered Shillings 26.3 billion from the companies leaving a balance of Shillings 9.2bn, which is with China Railway No. 3 Group.
 
 
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Details obtained by URN show that China Railway Group No. 5 has returned Shillings 8.4 billion, Zhongmei Engineering Group Limited Shillings 272.7million, China Railway 18th Group Limited Shillings 14 billion and Chongqing International Construction Corporation Shillings 3.5billion.
 
 
 
Despite the recovery of the monies, some COSASE members accuse officials from UNRA of conniving with the contractors to defraud the government.

Brigadier Francis Takirwa, the UPDF representative, says UNRA is guilty of connivance in the scam since the money was meant to be placed in a special imprest account to be monitored by both parties but this didn't happen.
 
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Abdul Katuntu, the COSASE Committee chairperson, says the delayed compensation of Project Affected Person puts another burden on government because a fresh valuation of assets has to be conducted given the appreciation of land.
 
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The committee investigations were triggered by the 2015 Auditor General's report, which showed that Shillings 47.7 billion advanced to the contractors for the compensation of projected affected persons, was unaccounted for, adding that there was no status report to verify the progress of compensation. 
 
UNRA then presented documents to COSASE indicating that only Shillings 15 billion was paid out by the contractors to the project affected persons. However, the Committee tasked UNRA to establish whether the said money was indeed paid to the beneficiaries since the payment isn't reflected on the bank statements before the committee.
 
 In its audit report presented before the committee recently, UNRA confirmed irregularities in the operations of funds. According to the report, UNRA instructed the firms to pay Shillings 19 billion of the Shillings 47.7 billion leaving a balance of Shillings 30.2 billion. 

 

About the author

Olive Nakatudde
Olive Nakatudde is a URN journalist based in Kampala. Nakatudde has been a URN staff member since 2013.

Nakatudde started out in journalism in 2009 with Dembe FM radio in Kampala. In 2012, Nakatudde joined Voice of Africa as a political reporter. She has been a photographer since her journalism school days at Makerere University.

Nakatudde is interested in good governance and public policy, which she reports on intensively from the Uganda Parliament. She is a keen follower of cultural affairs in Buganda Kingdom and covers the kingdom's Lukiiko (parliament). Nakatudde also reports on education and health.