KAMPALA industrial and business park project has hit a snag after the World Bank and the finance ministry failed to provide funds for the completion of the project.
By Mary Karugaba KAMPALA industrial and business park project has hit a snag after the World Bank and the finance ministry failed to provide funds for the completion of the project.
This was after the finance ministry asked the Auditor General to carry out a value-for-money audit to ascertain why a revised contract has raised the cost of the project by over 300%.
The joint venture, sitting on 896 hectares of land at Namanve, is estimated at sh350b and funded under a credit agreement between the Government and the World Bank.
The ministry refused to pay Spencon Services, the contractor who built the Uganda Investment Authority’s (UIA) office block, citing inflation of costs from the original sh790m to sh2b.
Meeting the UIA board led by the chairman, Patrick Bitature, MPs on the parliamentary statutory committee said the World Bank, which funded the project, was frustrated by the manner in which the project was handled.
“The ministry of Finance has failed to pay the balance of sh2.3b to the contractor you hired for the first project. You raised the cost of the first project by 300%. With the financial mess, there is no way you should preceed with the project,†committee chairman Reagan Okumu said.
When asked to explain how the funds increased without the board’s authority, Bitature blamed it on the management.
“Management told me that the cost had increased by 14% which they said was within the budget. ‘‘I did not want to be dragged into fights between the board and management,†Bitature said.
Namanve Business Park is one of the 22 industrial parks the Government plans to set-up to create jobs and widen the national taxable base.
Gulu, Arua, Lira, Mbale, Moroto, Tororo, Iganga, Rakai, Mubende, Luwero, Jinja, Nakaseke and Soroti would house the other parks.