The Tuesday afternoon meeting that was attended by Finance Minister, Matia Kasaija, was summoned by Kadaga over the controversy of the regarding Bridges that are supposed to run from Kayunga to Kuva Island and another from Kuva Island to Kamuli side. The speaker has severally demanded for answers from the Finance Ministry why the works on the Bridges have stalled.
convened by the Speaker of Parliament, Rebecca Kadaga to resolve the US $42M
payment dispute for Isimba Dam construction has ended in counteraccusations
between the officials of China International Water & Electric Co and Uganda
Electricity Generation Company Limited-UEGCL.
The Tuesday afternoon
meeting that was attended by Finance Minister, Matia Kasaija, was summoned by
Kadaga over the controversy of the regarding
Bridges that are supposed to run from Kayunga to Kuva Island and another from
Kuva Island to Kamuli side. The speaker has severally demanded for answers from
the Finance Ministry why the works on the Bridges have stalled.
During the meeting, Xia Neihang, the Isimba Dam project manager and executive
from China International Water & Electric Co accused the finance ministry of
unfairly withholding the payment of US$28M ever since the dam was commissioned
in May last year.
He said 85%
of the bridge is complete and the outstanding works are due for completion on
three month’s period pending the release of funds. However, Harrison Mutikanga,
the UEGCL Executive Director noted that the contractor should have constructed
the bridge on top of the dam, but since he had neglected to do so, he had to
incur extra costs for a new bridge.
revealed that the contractor was informed that he was eligible to apply for an
advance of the US$14M in line with their contract provided he produced a
retention money guarantee in accordance with Bank of Uganda requirements. He emphasized
that the guarantee was supposed to be irrevocable and unconditional.
//Cue in: “He is now…………….”
Cue out: “………………ban of Uganda.”//
noted that the total project cost is US$ 567.7M, adding that government has so paid
US$525.3M representing 92.5% payment. He said the balance is US$42.3m, which is
under the defects liability period. However, Xia couldn’t have any of this
noting that only US$14m was part of the defects retention money and his company
was entitled to the balance of US$28m.
response, Mutikanga noted that there are a number of issues that need to be
resolved before the contractor can earn all the money. He argued that US$28.3m had
been retained by the employer owing to a number of defects in the works.
that in March 2019 when the government took over the dam, the contractor was
supposed to have cured the defects by September 2019, which they identified while
running the plant. Mutikanga also revealed that there was outstanding scope of
works like the visitors area.
//Cue in: “If a……………….”
Cue out: “…………not completed.”//
insisted that according to the contract, his company was entitled to 95%
payment having completed the works. He explained that the defects liability
amount is meant to be only 5% of the total contract amount, saying the
government’s conduct was unacceptable.
//Cue in: “First in………………”
Cue out: “…………not acceptable.”//
The meeting agreed that the Ministry of Energy writes to the Solicitor General
for legal interpretation to help sort the impasse. Kadaga asked how the
contractor would be able to present their side of the story.
noted that the contract provides for a dispute adjudication board that has a
representative of both parties and a neutral member agreed by both parties to
solve any dispute that may arise.
//Cue in: “Because they……………..”
Cue out: “…………..third person.”//
The parties agreed that Kadaga writes to the energy ministry asking the
Permanent Secretary to seek the Solicitor General’s legal interpretation of the
impasse and demand a response within two weeks.