Works ministry decries lack of funds to pay contractors

Aug 22, 2020

Due to COVID-19, the ministry has not been able to receive all the money that was budgeted for.

The Ministry of Works and Transport has said it has no money to pay for completed project works.

The ministry's permanent secretary, Bageya Waiswa, told MPs on the public accounts committee (PAC) that due to COVID-19, the ministry has not been able to receive all the money that was budgeted for, especially that for capital development.

Waiswa told the MPs that during the fourth quarter of the financial year 2018/19, (March-June) which fell on the advent of COVID-19, the works ministry only received funds for salaries, pension, and gratuity and then later sh5.1b for capital development instead of the budgeted sh160b.

Pressure

"We are really under pressure from suppliers and contractors.

The fourth quarter, which fell on the advent of COVID-19 was bad and we were greatly affected. We still have unpaid certificates up to now. People did the work, they wanted to be paid. There are those who, after signing, they went to the bank and secured bank guarantees and then these bank guarantees have started earning interest which is passed on to us if we don't pay," he said.

According to the documents available, the ministry was allocated sh881b in the financial year 2018/19, but was later given an extra sh182b to purchase planes for the country.

Waiswa said currently the ministry has unpaid certificates worth sh30b and processed contracts worth over sh70b, but they cannot be signed.

Some of these contracts include the sh47b contract for the procurement of earthmoving equipment for the new 13 districts and the sh29b interconnectivity project "We have just held onto them, we cannot sign them because we do not have money. So, it is really hard for us. A number of projects have stalled due to restrictions on movement. The contractors are now asking for an extension. The first quarter release this financial year has not been good either. We were given sh53b for capital development, but before we could warrant the money, sh30b was removed from the system which has created us problems. The performance has also been bad," he said.

Waiswa and other ministry staff were appearing before the committee to answer queries raised by the Auditor General to Parliament for the financial year 2018/19.

They started out by briefing PAC on how COVID-19 has affected their operations.

The transport and works ministry is part of the national task force instituted to coordinate COVID-19-related activities.

Waiswa said the ministry is also facing challenges maintaining and servicing the 1,150 units of earthmoving equipment for road construction and maintenance, which was purchased and distributed to all districts except the 13 new districts.

"Right now some of them lack tyres and batteries. Last year, we managed to get only sh1b to buy tyres which was a real problem. The unfortunate part of it is that the roads infrastructure has been severely damaged by excessive rains and the districts cannot use the equipment to carry out the maintenance," he said.

The auditors established that out of the 30 output planned, a sample of 18 outputs was taken. Only one output was fully achieved, 16 partially achieved while one was not achieved at all.

Money diverted

It was also established that the ministry, during the year, diverted sh1b to unrelated activities, resulting in some activities not being implemented.

Mafabi asked the officials to write an explanation on what happened to the sh30b that was taken from the system and where the diversions took place.

"We need a report on how sh30b was taken from the system and also areas where the diversion took place. We want to know what exactly happened," he said.

Waiswa said the diversions occurred because of budgetary constraints.

(adsbygoogle = window.adsbygoogle || []).push({});