Members of Parliament on the Committee of Commissions, Statutory Authorities, and State Enterprises (COSASE) have grilled officials from the National Agricultural Advisory Services (NAADS) for their allocation of Shs15 billion towards bush clearing activities.
During Wednesday’s session, the NAADS Secretariat, led by Executive Director Samuel Mugasi, faced scrutiny before COSASE. The committee uncovered that the agricultural organization disbursed a substantial sum of Shs15 billion to Horyal Company Limited. This large payment was for the clearance of 15,000 acres of bushland in Lamwo district, designated for sugar cane cultivation.
The committee’s focus lies in dissecting the Auditor General’s report on NAADS’ financial records for the 2021/2022 fiscal year. Shedding light on the procurement process, Eunice Katto, NAADS’ Head of Procurement, explained that Horyal was chosen directly due to inclement weather conditions during the rainy season. Katto justified the decision by citing the lengthy and time-consuming nature of the open bidding process.
Katto added, “A Memorandum of Understanding was also established between Horyal and women’s groups to provide necessary labour.”
However, the Committee’s principal legal advisor, Ronald Ndyomugenyi, found Katto’s reasoning inadequate. He argued that her explanation ran afoul of the Public Procurement and Disposal of Public Assets Act, which mandates a competitive bidding process for contracts of such magnitude.
MP Bumali Mpindi questioned the legitimacy of justifying direct procurement for a bush-clearing endeavour. He expressed disbelief at the Shs15 billion price tag attached to this particular activity.
Mpindi challenged, “Why did bush clearing warrant direct procurement? Was it a unique case? Why was it not subjected to competitive bidding to encourage participation from other firms? Your rationale for direct procurement falls short.”
In response, NAADS Executive Director Samuel Mugasi disclosed that the decision to proceed with direct procurement stemmed from a directive issued by the Minister of Finance, Planning, and Economic Development. The directive instructed NAADS to execute a direct procurement process.
Mugasi said, “The initial communication was from the Prime Minister, urging collaboration with Horyal. Subsequently, in 2018, another directive surfaced, outlining the financing of the sugar cane project.”
Within this directive, Mugasi stated that the Minister of Finance instructed NAADS to forge a contractual agreement with Horyal and allocate funds to finalize the sugar cane outgrowers’ initiative.
Notably, the government holds a minority stake of 40 per cent in the Atiak Sugar Factory.
