MPs query sh15b permit project
Apr 23, 2006
MPS have queried the US$7.9m (sh15b) computerised driving permit (CDPs) project. The committee on finance, planning and economic development, in a report on the designing, printing and supply of the permits, said the contract being executed by Face Technologies (FT) Ltd, a South African company, w
By Felix Osike
MPS have queried the US$7.9m (sh15b) computerised driving permit (CDPs) project. The committee on finance, planning and economic development, in a report on the designing, printing and supply of the permits, said the contract being executed by Face Technologies (FT) Ltd, a South African company, was signed without the involvement of the Ministry of Finance. Only the communications ministry was involved.
The 17-page report, to be presented to Parliament, says, “The cost of acquiring a CDP should be made reasonable and permits given a long period i.e. four years, to reduce congestion and enhance compliance.â€
The MPs said the project increases the cost of acquiring new driving permits on top of introducing new costs for conversion of old permits to new ones.
To acquire a new one-year computerised permit, the driver has to pay an extra sh20,000, an increase of 80%, while that of a three-year permit has gone up by 44%. Drivers who currently hold valid driving permits have to pay between sh40,000 and sh55,000 to acquire a CDP.
“The increase of fees is very high and might inhibit compliance. To force the current driving permit holders to pay an extra sh20,000 plus other associated costs like transport to the processing centre, photographs, time lost and lodging fees for those from far off districts is unfair and unrealistic and would be unjustifiable in legal and economic terms,†the MPs said.
They expressed concern over the tedious acquisition procedure, which involves obtaining forms at Uganda Revenue Authority (URA), payment of fees at the bank, going to Face Technologies at Kyambogo after five days for the photograph, fingerprint and signature. Thereafter one pays fees to FT at Kyambogo, where one is issued with a temporary driving permit valid for 28 days. The CDP is picked after seven working days.
The report says under the agreement, URA only collects the license fees but does not control the database, which would be necessary to monitor and control revenue collection. The agreement also says FT “will not be liable for lost revenue, lost data or incidental, consequential, special or indirect damages.†The report estimates that URA would lose up to sh15b in three years from the conversion of old permits to the new ones.
Secretary to Treasury Chris Kassami had also in a separate communication raised concern over the project.
The MPs also queried a clause in the contract which says FT shall be paid by the Government under a self-financed scheme from all income related to issuance and/or renewal of the permits. They recommended that this proposal be dropped and the Government pays directly using funds from the consolidated account.
The MPs opposed a memorandum of understanding proposing that FT runs a joint account with URA. It also suggests that FT would later transfer the money that accrues to the Government every evening. “URA cannot run a joint account with the contractor. Monitoring, evaluation and accountability of how much has been paid would be difficult under this scheme and would put government at the mercy of Face Technologies. This is contrary to the URA Act (Cap 196),†the report says.
The MPs also complained of a provision which says FT would provide comprehensive insurance for the equipment for only 12 months from the date of project hand-over.
The report also says the contractor’s price is based on an estimate of 500,000 driving permits. The contractor was to recover the money within two years and any outstanding payments beyond that period would be recovered with default interest.
The MPs said the agreement was unclear when it comes to what fees are applicable after the contractor has paid himself the $6.8m.
Besides, the agreement provides that the ownership of the software and documentation shall remain vested in the FT or its third party licensors. “The fact that the ownership of the software and documentation shall always remain vested in FT puts the Government at ransom and could be a source of conflict, connivance and corruption,†the MPs asserted.
MPS have queried the US$7.9m (sh15b) computerised driving permit (CDPs) project. The committee on finance, planning and economic development, in a report on the designing, printing and supply of the permits, said the contract being executed by Face Technologies (FT) Ltd, a South African company, was signed without the involvement of the Ministry of Finance. Only the communications ministry was involved.
The 17-page report, to be presented to Parliament, says, “The cost of acquiring a CDP should be made reasonable and permits given a long period i.e. four years, to reduce congestion and enhance compliance.â€
The MPs said the project increases the cost of acquiring new driving permits on top of introducing new costs for conversion of old permits to new ones.
To acquire a new one-year computerised permit, the driver has to pay an extra sh20,000, an increase of 80%, while that of a three-year permit has gone up by 44%. Drivers who currently hold valid driving permits have to pay between sh40,000 and sh55,000 to acquire a CDP.
“The increase of fees is very high and might inhibit compliance. To force the current driving permit holders to pay an extra sh20,000 plus other associated costs like transport to the processing centre, photographs, time lost and lodging fees for those from far off districts is unfair and unrealistic and would be unjustifiable in legal and economic terms,†the MPs said.
They expressed concern over the tedious acquisition procedure, which involves obtaining forms at Uganda Revenue Authority (URA), payment of fees at the bank, going to Face Technologies at Kyambogo after five days for the photograph, fingerprint and signature. Thereafter one pays fees to FT at Kyambogo, where one is issued with a temporary driving permit valid for 28 days. The CDP is picked after seven working days.
The report says under the agreement, URA only collects the license fees but does not control the database, which would be necessary to monitor and control revenue collection. The agreement also says FT “will not be liable for lost revenue, lost data or incidental, consequential, special or indirect damages.†The report estimates that URA would lose up to sh15b in three years from the conversion of old permits to the new ones.
Secretary to Treasury Chris Kassami had also in a separate communication raised concern over the project.
The MPs also queried a clause in the contract which says FT shall be paid by the Government under a self-financed scheme from all income related to issuance and/or renewal of the permits. They recommended that this proposal be dropped and the Government pays directly using funds from the consolidated account.
The MPs opposed a memorandum of understanding proposing that FT runs a joint account with URA. It also suggests that FT would later transfer the money that accrues to the Government every evening. “URA cannot run a joint account with the contractor. Monitoring, evaluation and accountability of how much has been paid would be difficult under this scheme and would put government at the mercy of Face Technologies. This is contrary to the URA Act (Cap 196),†the report says.
The MPs also complained of a provision which says FT would provide comprehensive insurance for the equipment for only 12 months from the date of project hand-over.
The report also says the contractor’s price is based on an estimate of 500,000 driving permits. The contractor was to recover the money within two years and any outstanding payments beyond that period would be recovered with default interest.
The MPs said the agreement was unclear when it comes to what fees are applicable after the contractor has paid himself the $6.8m.
Besides, the agreement provides that the ownership of the software and documentation shall remain vested in the FT or its third party licensors. “The fact that the ownership of the software and documentation shall always remain vested in FT puts the Government at ransom and could be a source of conflict, connivance and corruption,†the MPs asserted.