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NAADs queried over Sh2.6b for terminal benefits

By Nicholas Wassajja

Added 22nd March 2018 01:26 PM

The MPs on the committee heard that the 26 districts could not account for funds advanced to them by NAADS as terminal benefits.

NAADs queried over Sh2.6b for terminal benefits

National Agricultural Advisory Services (NAADS) executive director Samuel Mugasi and his team appear before the COSASE March 20, 2018. Photo by Maria Wamala

The MPs on the committee heard that the 26 districts could not account for funds advanced to them by NAADS as terminal benefits.

The National Agricultural Advisory Services (NAADS) officials found a hard time explaining whereabouts of about sh2.6b as part of payment for terminal benefits to staff members in 26 districts across the country.

Appearing before the Committee on Commissions, Statutory Authorities and State Enterprises (COSASE) to respond to queries raised by the Auditor General (AG) on Tuesday, the officials were also tasked on the wrong computation of the said terminal benefits and a host of pending claims over the same.

The MPs on the committee heard that the 26 districts could not account for funds advanced to them by NAADS as terminal benefits.

"The districts didn't have financial records while others diverted the funds allocated to them to unrelated activities, an expenditure that is ineligible," reads the AG's report.

The lawmakers led by committee chairperson Abdul Katuntu (Bugweri County) wondered why NAADS records on the matter were littered with wrong computation of terminal benefits in some districts.
Katuntu said that for example in Rakai district, 32 diploma holders under the agricultural advisory services providers were paid gratuity at a rate of Sh900, 000 each instead of Sh750, 000 which caused a colossal over payment yet in some two cases, staff whose employment contracts had expired in November 2012, remained on the payroll and were paid terminal benefits amounting to about Sh7m.

"Using wrong scales to calculate gratuity and maintaining staff on the payroll without valid employment contracts caused a huge financial loss to NAADS," said Katuntu.

The MPs also wondered why in some cases payment for gratuity was computed differently as some districts based on instructions from the NAADS secretariat, hence providing full month gross salaries to terminated contracts yet others such as Nakasongola, Kibaale and Butambala districts, based their computations on staff contracts that provided only 25% of beneficiaries basic salary.

Michael Tusiime, the Mbarara Municipality MP warned that such inconsistencies could lead to litigation in courts of law and may result in further loss of money to NAADS.

The NAADS head of Finance, Rehema Tryakira explained that, "all the district local governments were given clear guidance on how the funds for terminal benefits were to be utilized and they were required to remit any unutilized balances to the consolidated fund."

She added that the NAADS management is following up the matter with the concern chief administrative officers to ensure compliance with both the instructions and financial regulations.

However, she noted that in the said scam, Sh783m was recovered from some districts but the money is not part of the Sh2.6b that is being queried.

The MPs also found that the NAADS management failed to deduct withholding tax on benefits paid in kind from staff at senior management level but the figures couldn't be ascertained.

It was also alleged that the NAADS management from 2015 backwards, didn't deduct National Social Security Fund (NSSF) leave payment to several staff members and that in some cases they gave the AG understatement of salaries and wages in their financial statements.

Efforts by Tryakira to explain that NAADS management was not aware that its staff was entitled to NSSF deductions during their annual leave were futile as MP Moses Kasibante (Rubaga North) noted that although the leave payment deductions were not remitted to NSSF, the 5% from the beneficiaries' gross salary was being deducted.

Tryakira said that since NAADS management was made aware that NSSF leave payment is a statutory obligation, they have tried to make reforms but Florence Namayanja (Bukoto East) warned that once parliament is availed with the exact number staff members affected and the total figure, officers in charge of the matter will be held personally liable.

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