Parliament’s Committee on Commissions, Statutory Authorities and State Enterprises (COSASE) has directed officers from the Criminal Investigations Directorate (CID) to serve summons on Uganda National Airlines Corporation (UNAC) officials and return to the committee with proof of delivery.
The committee wants the airline’s accounting officer, chief finance officer, chairperson of the Contracts Committee, manager of corporate affairs, and the current and former chief executive officers to appear before it. They have also been directed to present documents required by the committee to scrutinise the Auditor General’s findings on the airline for the year ended June 30, 2025.
COSASE chairperson Muwada Nkunyingi warned that CID officers who fail to execute the summons could face consequences, including replacement. He said the Director of CID could also be summoned to explain why the officers failed to support the committee in enforcing its summons.
The summons come against the backdrop of longstanding concerns over the financial management, procurement practices and governance of Uganda Airlines. The committee is seeking to scrutinise the latest Auditor General’s observations while also following up on earlier findings relating to the national carrier.
The Auditor General previously issued a qualified opinion on UNAC’s financial statements for the 2020/2021 financial year, prompting investigations into the airline’s operations by Parliament’s Public Accounts Committee under COSASE.
The audit found that UNAC recorded a loss of Shs164.5 billion in the 2020/2021 financial year against revenue of only Shs46.9 billion. In the previous financial year, the airline had recorded losses of Shs102.4 billion.
The committee subsequently held meetings with the airline’s management and board members, then Minister of Works and Transport Gen Katumba Wamala, former chief executive officer Cornwell Muleya and former board chairperson Ahabwe Pereza.
Procurement breaches
Among the concerns raised was the airline’s procurement process, with the Auditor General finding that UNAC conducted 25 procurements outside the approved procurement plan for the 2020/2021 financial year.
The procurements, conducted in different currencies, amounted to billions of shillings. Management attributed the irregular procurements to the airline’s start-up phase and regulatory requirements in the aviation sector.
The committee, however, found that the procurements contravened requirements under the Public Procurement and Disposal of Public Assets (PPDA) Act and recommended that officers responsible be held accountable.
The airline also recorded poor revenue performance during the period under review. Out of an internal revenue target of Shs304.6 billion for the 2020/2021 financial year, only Shs48.6 billion, representing 16 per cent, was collected.
Management attributed the poor performance to the Covid-19 pandemic, prolonged closure of airspace and delays in deploying aircraft due to certification challenges. The committee, however, pointed to wider governance weaknesses, including the absence of an approved staff structure, weak board independence and human resource management challenges.
Rising costs
The committee also raised concern over the airline’s expenditure, noting that its total costs in the 2020/2021 financial year stood at Shs211.5 billion, significantly above the revenue generated.
MPs warned that continued losses could erode the airline’s capital unless measures are taken to increase revenue and control expenditure.
They cited excessive wage costs, inefficient procurement, weak marketing strategies and the involvement of middlemen, particularly in fuel procurement, as some of the factors contributing to the airline’s financial challenges.
The committee further found that UNAC was operating without a board-approved staff structure and salary scale, resulting in salary disparities and excess expenditure of Shs4.9 billion on staff costs.
Governance concerns
The committee also raised concerns over the qualifications and recruitment of senior officials. It cited the appointment of former CEO Jennifer Bamuturaki, saying her appointment followed a presidential directive that halted an ongoing competitive recruitment process.
The committee described the Shs98.1 million paid to PricewaterhouseCoopers for the aborted recruitment process as wasteful expenditure and recommended that the money be recovered from the board members involved.
MPs also raised concerns over alleged conflicts of interest and influence peddling in the award of public relations contracts to Abbavater Group Ltd, a company linked to Bamuturaki.
The contract was reportedly awarded without competitive bidding and at inflated costs. The committee recommended prosecution of officials implicated in the irregular procurement and recovery of public funds lost in the process.
Other findings included outstanding payables of Shs47 billion to the Uganda Civil Aviation Authority, which the committee said pointed to financial indiscipline.
The committee also cited delayed disciplinary cases that resulted in double payments and losses of Shs2.3 billion, failure to refund Shs50 million in travel advances and irregular hiring of online bloggers at a cost of Shs156 million.
The committee further raised concern over missing ticket revenues amounting to Shs982 million and called for a forensic audit to establish how the money was lost.
The latest summons are therefore expected to give COSASE an opportunity to question current and former officials of Uganda Airlines and obtain documents necessary to establish whether earlier recommendations and audit concerns have been addressed.
The committee’s intervention comes as Parliament continues to scrutinise the management of the national carrier and demand greater accountability for public funds invested in Uganda Airlines.
