Why cabinet’s move to reprimand implicated BoU officials in COSASE report is a welcome panacea

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Bank of Uganda

By Kagenyi Lukka

 It had become like a colossus that whenever a parliamentary report recommends to the executive, especially when it comes to corruption, the executive takes no tangible action.

So, realizing that nothing would be done, the culprits that design corruption syndicates and siphon billions of public funds, have always mocked Parliament.

In most cases, they loudly shout at MPs: Do your investigations, after all nothing would be done, your recommendations are just advisory.

However, there is hope that when it comes to investigations around Bank of Uganda (BoU), such impunity, I hope, will be nipped in the bud.

Last week, the finance minister, Matia Kasaija revealed that Government will act on the recommendations from the probe report into the central bank activities, especially the controversial closure of seven commercial banks.

The said recommendations were proposed in a February 2019 report that was compiled by Parliament’s Committee on Commissions, Statutory Authorities and State Enterprises (COSASE) that was chaired by Bugweri County legislator Hon. Abdu Katuntu.

The committee spent over five months interrogating BoU top officials over the procedures employed during the closure of seven commercial banks, the most recent being Crane Bank Limited (CBL) which was closed in October 2016.

The other recommendation, which called for an overhaul of the central bank, are also contained in the Presidential Tripartite Committee that was set up by President Museveni in May 2018

BoU Governor Emmanuel Tumusiime-Mutebile is said, on February 7 2018, to have issued an internal memo announcing a number of staff transfers and appointments.

In the memo, Mr Mutebile is said to have appointed five staff from outside the bank to various positions, a decision that prompted some dissatisfied staff to petition the ombudsman.

The report partially pointed out that the central bank was polarised by cliques; one affiliated to the governor Tumusiime Mutebile and the other to his deputy Louis Kasekende.

The committee faulted the Governor for ignoring the board to promote nine staff to the level of Assistant Directors, creating new positions as well as recruiting five new officials from outside despite some not meeting entry requirements to BoU positions.

The probe revealed that of the five, only a one Ojangole was found to have passed the minimum entry requirements, while the rest were either under-qualified or did not have the required experience for the respective offices.

Among the recommendations the tripartite committee thought would ease tension at BoU, was for the President to create a second position of Deputy Governor/s, as well as a clear separation of power for the position of the governor from that of the board chairman.

The committee advised that one deputy governor would be in charge of administration while the other would help the governor on the core function of the central bank.

In conclusion, the report highlighted that BoU officials had made many “questionable decisions” and contravened sections of the Financial Institutions Act during the closure and sale of seven commercial banks that include- Crane Bank, National Bank of Commerce, Global Trust Bank, Greenland Bank, Cooperative Bank, International Credit Bank, and Teefe Trust Bank.

Surely, the unending challenges that have rocked the central bank need urgent cleansing to flush out the hidden problems.

It therefore follows that acting on the report with a view of harmonizing the operations of the central bank is a welcome initiative.

The writer is a current affairs analyst and aspiring MP for Ikiiki county Budaka District.

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