Controversy surrounding the government’s planned buyout of electricity distributor Umeme has intensified this morning following the revelation of a significantly lower buyout figure in a special audit report.
The report, submitted to Speaker of Parliament Anita Among, indicates that the final buyout amount stands at $118 million (Shs430 billion), a stark contrast to the $190 million (Shs700 billion) that Parliament approved last week.
Speaker Among herself confirmed the discrepancy, stating, “Discrepancies on the figure supposed to be payed to Umeme as a buyout… $190 million, $118 million is the final audit.”
She further announced that the report would be presented to Parliament this morning, adding, “We are going to have this report played on table this morning. We pray for better services as UEDCL takes over.”
This development comes amidst growing calls to halt the loan approval process from Stanbic Bank, which was intended to finance the buyout.
However, details of the special audit report remain undisclosed at this time. Efforts to obtain comment from Auditor General Edward Akol and his team have been unsuccessful, as they have declined to comment on the matter.
The parliamentary approval on March 20th saw the government secure a loan of $190 million from Stanbic Bank for the Umeme buyout. This decision was made despite clear warnings from both the Auditor General and the Committee of National Economy.
The Committee had advised Parliament to “halt the process until the actual buyout amount is established, due to various figures fronted for this expenditure.”
The government’s urgency in securing the loan was driven by the impending expiration of the agreement between the government and Umeme on March 31, 2025.
The State Minister for Finance, in presenting the loan request to Parliament, argued that the buyout would improve “accessibility, affordability and eliminate the high cost of services.”
However, the Committee of Parliament on National Economy had raised concerns, requesting that the government wait for the audited reports from the Auditor General.
The Committee Chairperson pointed out several “irregularities including the actual cost of the buy which has been fluctuating.”
The recommendations sparked mixed reactions among Members of Parliament. Some expressed worries about the potential costs and crisis that could arise from delaying the buyout, especially with the concession deadline approaching.
Minister Musasizi emphasized the time-sensitive nature of the loan request, warning of “hefty penalties if the process is not completed by end of March.”
Ultimately, Parliament approved the loan, citing the need to process it within a tight timeframe to meet the commitment to buy out Umeme.
The revelation of the significantly lower buyout figure in the special audit report now throws a new spanner in the works, raising serious questions about the initial valuation and the process leading up to the parliamentary approval.
As the report is tabled in Parliament this morning, the nation awaits further details and the potential implications for the Umeme buyout and the future of electricity services under the Uganda Electricity Distribution Company Limited.
