Parliament Public Accounts Committee (PAC) has recommended that the Finance Minister Matia Kasaija should be censured for misleading Parliament and obtaining the 200-million-dollar Preferential Trade Area-PTA loan by false pretence. The committee further recommends that the Secretary to Treasury Keith Muhakanizi should be relieved of his office for superimposing his authority during the processing of the loan.
The recommendations to parliament are carried in the PAC report on the acquisition and utilization of the 200-million-dollar Preferential Trade Are-PTA loan. The report was tabled before parliament on Wednesday afternoon by the committee chairperson Angelline Osegge.
The committee last year probed the utilisation and disbursement of the loan in which Ministry of Finance was under the spotlight over failure to release the 200-million Dollar loan to the rightful beneficiaries even when the money was disbursed by PTA Bank The National Medical Stores- NMS could not access the needed Shillings 156 billion from the loan to purchase drugs with a financing deficit of Shillings 68 billion caused by fluctuations in foreign exchange since 2011, which affected medical supplies to government health facilities.
The money was also meant to finance a shortfall in domestic revenue that was projected at 288 billion Shillings for the 2015/2016 financial year and substitute domestic borrowing to the tune of Shillings 280 billions The loan was also meant to ease finance expenditure pressure resulting from the exchange rate depreciation in the 2015/2016 financial year. However, to date the Ministry has failed to release the Shillings 156 billion meant for NMS despite a financing deficit of Shillings 68 billion due fluctuations in foreign exchange since 2011, which has affected medical supplies to government health facilities.
This loan postal had originally been rejected by parliament on 7th January 2016 but the ministry of finance changed the objective of the loan emphasizing medical supplies to get the approvals required on 26th April 2016.
“The Minister of Finance, Planning and Economic Development by false pretence impressed upon Parliament in the justification for the loan approval stating the critical area for funding was medical supplied by NMS thus finance minister received the money fraudulently.” reads part of the conclusions of the committee report.
Osegge told parliament that although the finance ministry had received the funds, they had not released 68 billion Shillings to NMS as earlier on claimed by the ministry and that even after more loan funds were released, the concerned beneficiaries were neither informed nor given the funds.
“In a letter to the Speaker of Parliament of 15th March 2017, the Minister of Finance lied that the necessary contracts had not been provided by NMS to enable the necessary funds to be disbursed. The Minister did not reply to the letter of the Governor of the Bank of Uganda rejecting the loan proposal despite the concerns clearly raised.” further reads the committee report.
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