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MPs want Govt to explain non-performing loans

By Vision Reporter

Added 19th March 2015 03:21 PM

Members of the parliamentary budget committee have demanded that sectors with non- performing loans under them should appear to explain the reasons why, before a decision is taken.

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Members of the parliamentary budget committee have demanded that sectors with non- performing loans under them should appear to explain the reasons why, before a decision is taken.


By Joyce Namutebi        

Members of the parliamentary budget committee have demanded that sectors with non- performing loans under them should appear to explain the reasons why, before a decision is taken.


The MPs were incensed by the fact that some of the loans secured years ago by the various sectors are performing at zero percent. Such loans, they said, were negatively affecting the economy.

During a committee meeting at Parliament, a document showing the status of external loan implementation by the sectors as at December 31, 2014 was circulated to members.

“We need to engage the various sectors to explain why loans under their dockets are not performing,” committee chairperson, Amos Lugolobi said adding that government has to avail Sh1.4 trillion for payment of interest on the commitments.

From the document, projects with loans performing at zero percent include Nigeria TF-Improvement of health services at Mulago and KCC (now KCCA), whose loan became effective on July 2, 2012 and the development of specialised maternal and neonatal health unit in Mulago-Mulago 111 (IDB loan no. UG-077&80), whose loan became effective February 4, 2013.

Also Construction and equipping of four technical institutions no.849, Tirinyi, Pallisa-Kumi/Kamonkoli road, Rural electrification project, energy development and access expansion project in seven towns-1484p, Kampala water Lake Victoria WATSAN project, whose loan effective date was July 9, 2012 and dry lands integrated development project.

Lugolobi said: “We have to take a decision on the loans. We are almost operating at crisis level.”

He directed the budget office to compile a more detailed report on the loans using the available reports on the subject.
Madi-Okollo MP, Martin Drito suggested that ministries should be restrained from taking on loans which they cannot utilize.

Army representative, Phinehas Katirima said ministries with non -performing loans must show cause as to why sanctions should not be imposed on them.
            
            

 

MPs want ministries to explain non-performing loans

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