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Parliament queries sh1.2 trillion road funds

By Lisa Nsaba

Added 30th November 2018 09:02 AM

Members of the committee blamed the government, saying that because of its delay in effecting the loan, the country will suffer financial loss due to the increased interest rates.

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Members of the committee blamed the government, saying that because of its delay in effecting the loan, the country will suffer financial loss due to the increased interest rates.

Parliamentary committee members on National Economy have demanded an explanation from government for the delayed implementation of approved loans of the US$110m (about sh411.5bn) Muyende-Nakapiripirit and the US$210m (about sh785.5bn) Rwekunye-Apac-Lira-Acholibur road projects from the Islamic Development Bank (IDB).

The Ministry of Finance and that of Works and Transports were seeking approval of the new financing terms of the loans, part of which were higher interest rates , from 4.15% to 4.75%, more than what Parliament had approved in 2015, due to changes made by the bank in January this year.

They were presenting the briefs to the committee at Parliament over the week.

Members of the committee blamed the government, saying that because of its delay in effecting the loan, the country will suffer financial loss due to the increased interest rates.

“We have been battling issues of slow utilisation of loans by government, if you had effected it in time, these changes made by the bank would not have affected us,” Syda Bumba, the MP for Nakaseke North and the chair of the committee said.

She advised government to change in order to avoid worse scenarios which will cause scenarios like the bank pulling out and stop providing funds, despite having no financial loss in this loan.

“There was no loan, we approved it but it was not effected, so there was no financial cost, but there was still a loss of time value, and people living in these areas are affected,” Bumba said.

William Nzoghu, the MP for Busongora County North asked the Minister to present the first approved brief of the loan and the current brief to the committee for it to analyse and compare before approving the loan.

“You had a remarkable period of time to effect this loan. It would only be fair if you presented this committee with both sets of briefs and an explanation for the delay,” Nzoghu said.

Monica Azuba Ntege, the Minister of Works said there was a delay due major reforms that were happening the same year, 2015, in Uganda National Roads Authority which the Ministry was caught up with.

“We had advertised at a national level after the loan was approved, but the bank said we also had to advertise internationally, this takes a minimum of 1 year, this also caused a delay,”Azuba explained.

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