Gov’t Risks Losing Over Shs7.2 Trillion In Compensations

Gov’t Risks Losing Over Shs7.2 Trillion In Compensations

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By Hanning Mbabazi

Kampala: This was revealed by the Solister General Francis Atoke on Thursday 22 August appearing before the Public Accounts Committee (PAC) to respond to queries in the Auditor General’s report for the year ending June 2018.

Atoke expressed his disappointment that his ministry is suffering for actions of other ministries and departments that cause liability to government through their reckless conduct.

The said monies are in form of contingent liabilities and guarantees comprising of cases that have been filed against Government pending hearing, cases before courts under hearing and cases in which government has appealed against the Court ruling.

He expressed his worry saying, money will continue rising because people are aware of their rights and take advantage of every error committed by government ministries and departments to demand for compensation and requested

According to Atoke, 99 percent of the arrears in his ministry are through breach of contract on multi-billion shilling projects by other ministries thus requesting Ministries, Departments and Agencies that cause liability to government to pay the court awards from their own budgets.

Reading from documents tabled before PAC, some of the ministries under contingent liabilities include Ministry of Defence and Veteran Affairs 36.3 billion, Uganda Land Commission 53.8 billion, Uganda Prisons Service 60 million, Ministry of Energy and Mineral Development 31.6 billion, Ministry of Gender 121.1 million, Ministry of Health 94.3 million, Ministry of Education 288.7 million, Office of the President 10.31 billion, Ministry of Finance 316.3 million and others.

Maruzi County legislator Maxwell Akora wondered why the contingent liabilities are not catered for under the Treasury for better planning saying they are a national debt in away. But Atoke argued that the funds have not yet accrued and that is why they are reported by the Justice and Constitutional Affairs Ministry.

Auditor General’s June 2018 report of John Muwanga noted that the contingent liabilities figure has been significantly increasing citing an 18.2 percent increase from 6.16 trillion reported as at 30th June 2017 to 7.29 trillion as of 30th June 2018.
“I further observed that contingent liabilities totalling to 112.5 billion shilling were provided for during the year ended 30th June 2018 and given the numerous litigations, it is likely that the figure will increase.

“Due to the increasing contingent liabilities, there is a risk that the situation may jeopardize government operations in case the liabilities crystallize,” reads part of the audit report.

PAC Chairperson Nathan Nandala Mafabi directed the Solicitor General to avail his ministry with a reconciliation of the 7.2 trillion showing how many cases and their awards that have crystallized and those that are yet to crystallize. He directed that the information is provided on Friday.

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