MPs Question UDB Officials over UGX 455Bn Covid-19 Stimulus Funds

The 455 billion was in August 2020 through a supplementary budget approved by Parliament under UDB to help businesses that were affected by Covid-19.
Parliament Finance Committee Chairperson Henry Musasizi.

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Parliament’s Finance Committee has tasked officials from Uganda Development Bank (UDB) to account for the 455 Billion Shillings which was appropriated to mitigate Covid-19 effects on businesses.

This was during a meeting between UDB officials led by the Deputy Executive Director, Denis Ochieng and MPs. Ochieng told MPs that since August 2020, the Bank has only disbursed 202 billion Shillings by February 2021.

The 455 Billion Shillings was in August 2020 through a supplementary budget approved by Parliament under UDB to help businesses that were affected by Covid-19.  

Ochieng did not avail a list of beneficiaries and how much each received from the stimulus package but noted that the bulk of the funds had gone to agro-processing and industry. 

However, this submission was not received well by MPs who noted that the 455 Billion appropriated by parliament was meant to help keep companies that were struggling afloat as a result of the Covid-19 pandemic. The pandemic occasioned a lockdown that led to the closure of several businesses due to lack of income while others stagnated.

Henry Musasizi, the Finance Committee Chairperson said that the key question that they want to be answered is the particulars of the beneficiaries from the stimulus package. He further demanded answers regarding how much the Bank spent in saving schools.

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Following Musasizi’s statement, the UDB officials said that they had not anticipated questions regarding the lists of beneficiaries to come up and they sought more time to avail the information to the committee. 

But Ochieng further revealed to the committee that after receiving the money, UDB signed a Memorandum of Understanding (MoU) with the Ministry of Finance, Planning and Economic Development which gave them guidelines on how to spend the funds.

According to UDB, the guidelines required that the money be loaned out to businesses that were to be involved in improving the production of essential goods and services, and others working on import substitution.

Regarding schools struggling during the Covid-19 pandemic, Ochieng said that UBD only deferred payment of loans by the schools.  Musasizi then wondered what the money approved by parliament did if the bank did not consider supporting the schools with it at the time when they were closed.

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Musasizi blamed UDB for deviating from the purpose of the stimulus package. He directed them to appear again on Wednesday next week with disbursement evidence.

Jane Pacuto Avur, the Pakwach Woman MP also said that the information availed to them was not adequate to account for the 455 Billion Shillings.

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Charles Illukor, the Kumi County MP also shared the same sentiments saying that UDB needed to come out clearly on how the money availed to them was spent and whether it was in line with the initial purpose that it was intended for.

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