Pension Scam Payments Were Not Verified - Finance

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In short
The Accountant General Lawrence Ssemakula told the committee that the Finance Ministry does not access a list of pensioners from Public Service before releasing funds.

Over 260billion Shillings that was paid out to ghost pensioners by the Ministry of Public Service was not verified by the Finance Ministry, the Public Accounts Committee of Parliament was told today. 

Fixon Okonye, the Director Internal Audit said that his office was by-passed on verifying the list of pensioners at the time the payment was made. 

Okonye was appearing before the committee which has revived investigations into the theft of 165billion Shillings that was paid out to non- existent pensioners.

PAC is also investigating circumstances under which another 88 billion Shillings was wrongly budgeted as Social Security Benefits in contravention of Section 1(8) of the National Social Security Act that exempts pensioners from social security contributions.

Also under scrutiny is the payment of 15billion Shillings to a ghost Law firm.

The committee took up the matter after reports emerged that CIID messed up the case by submitting two contradicting investigation reports to the Directorate of Public Prosecutions (DPP) causing slip-ups in the trial. Nine suspects were charged with masterminding the plunder before the case was dismissed for lack of witnesses.

Okonye told the committee that his office dealt with collection of bio-data of pension and gratuity recipients but was never consulted on the verification of final payment schedule from the Public Service.
 
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The Accountant General Lawrence Ssemakula said the Finance Ministry does not access the list of pensioners from Public Service before releasing funds.

"In this particular case, Ministry of Finance was acting upon a request from the then Permanent Secretary Jimmy Lwamafa for funds to pay pensioners in the period February - June 2011," he added.  

Secretary to the Treasury Keith Muhakanizi said that in the pension's verification process, Internal Auditors report to the Accounting Officer of the relevant ministry, whom he has no control over.

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However, Muhakanizi regretted the release of 88.2billion Shillings that was irregularly budgeted for as Social Security Benefits during the Financial Year 2010/11 and 2011/2012. He described the error as unfortunate but hastens to add that Parliament and the Public Service Ministry share the blame for failing to detect the anomaly.

Committee Members led by the Paul Mwiru accused the finance ministry officials of negligence which led to loss of the funds.
 
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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.