The Ministry of Water and Environment has come under scrutiny by the Public Accounts Committee (Central Government) for failing to seek parliamentary approval for an additional expenditure of Shs25.3 billion in the Strategic Towns Water Supply and Sanitation Project.
Appearing before the committee chaired by Hon. Muwanga Kivumbi on Tuesday, 11 March 2024, ministry officials led by Permanent Secretary Alfred Okot failed to justify why they did not process a supplementary budget request for the extra funds spent.
An audit for the year ending December 2024 revealed that Shs25.3 billion was spent without authorisation having been carried over from the previous financial year.
The project had an approved external financing budget of Sh22.7 billion but Shs48.01 billion was remitted. The total available funds for spending amounted to Shs58.1 billion.
The over-receipt of funds was attributed to direct payments by the donor to consultants and contractors as explained by the Accounting Officer.
The Project Manager for Strategic Towns Water Supply and Sanitation, Felix Twinomucunguzi said that the COVID-19 pandemic negatively impacted on both physical and financial performance leading to delays in planned activities and budgets. In subsequent financial years, project activities were expedited, resulting in over-receipt on earlier budget allocations.
However, Kivumbi dismissed the justification.
“The law is very clear; any additional expenditure outside the approved budget must go through a supplementary request to Parliament. Yet here we are, with an extra Shs25.3 billion spent without approval. That is illegal and unconstitutional,” he said.
Hon. Jessica Ababiku (NRM, Adjumani District Woman Representative) questioned why the ministry failed to disclose how external factors such as COVID-19 and the Ukraine-Russia war impacted project costs.
“Why didn’t you avail all these nitty-gritties to the auditors?” she asked.
Twinomucunguzi admitted to inconsistencies in the expenditure breakdown, stating that the extra funds were used for pre-contract activities including compensation and logistical adjustments.
However, MPs dismissed this explanation asserting that all expenditures beyond the approved budget required prior parliamentary authorisation.
Under Secretary, Emmanuel Mugunga attempted to downplay the issue, arguing that the funds were not new but merely unspent resources from the previous financial year.
“This is not an additional resource; it’s simply money that was not spent prior but is now available,” he said.
However, Kivumbi dismissed the explanation asserting that any unspent funds must be reallocated through a supplementary budget process.
“The Public Finance Management Act is clear; unspent funds do not automatically roll over. You either include them in the next budget cycle or process a supplementary. Anything else is illegal,” he said.
The committee directed the ministry to provide a comprehensive breakdown of the expenditure and formally explain why a supplementary request was never made.
Failure to comply could result in further accountability measures against the ministry officials responsible for the financial oversight.
Meanwhile, regarding stalled projects, Twinomucunguzi stated that COVID-19 and the Russia-Ukraine war had severely affected operations. The committee then tasked him to explain why some projects had not progressed.
“One of the most affected countries was China and India, which were our main sources of materials especially steel pipes. The production lines were curtailed,” he said.
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