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KCC has to claim its money

By Vision Reporter

Added 22nd January 2007 03:00 AM

THE sale of Nakasero Market is telling for the mess in the Kampala City Council. The saga goes back to 2002, when KCC appointed an external company to manage the market.

THE sale of Nakasero Market is telling for the mess in the Kampala City Council. The saga goes back to 2002, when KCC appointed an external company to manage the market.

THE sale of Nakasero Market is telling for the mess in the Kampala City Council. The saga goes back to 2002, when KCC appointed an external company to manage the market.

The company was supposed to maintain the structures and collect taxes from the vendors on behalf of KCC.

Sheila Investments Limited, owned by Hassan Basajjabalaba, won the tender because it promised to remit a record sh25m per month to KCC.

However, in 2004, the company started defaulting. Of the sh300m it was supposed to pay, it only remitted sh102m.

It became worse in 2005, when the company did not pay any money at all. By November, the total in arrears was over sh450m.

A Commission of Inquiry, set up by the Ministry of Local Government to look into irregularities in KCC, recommended that “money collected from the vendors should be refunded to them (KCC) by Sheila Investments Ltd”.

The company not only ignored the Commission’s recommendation, it continued defaulting. Throughout 2006, again no money was remitted.

Then there is the issue of the valuers. The commission recommended an independent valuer whenever KCC sells or leases any land.

In the case of Nakasero Market, KCC relied solely on the city valuer, who valued the property at sh2b. A senior government valuer, however, estimated the value to be about sh10b.

Lastly, there is the swap issue. Contrary to regulations, Sheila Investments built a new structure on the market premises. Traders were asked to make a contribution, which they did up to a tune of sh2m to sh4m each.

It is this substandard structure, built on KCC land with vendors’ contributions and valued at sh1.9b, which Sheila Investments swapped with the premium of sh2b for the lease of the market for 49 years!

KCC halted the deal after it was exposed by this newspaper, which was a brave step. But it is not enough. It should claim its arrears from Sheila Investments.

An independent valuer must be brought in to value the property on Nakasero Market and any other property leased out.

And the Minister of Local Government should see to it that the recommendations of the Commission of Inquiry are not just a piece of paper.

KCC has to claim its money

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