Ministry of Water and Environment Under Scrutiny for Unauthorised Shs25.3 Billion Expenditure

An audit for the year ending December 2024 uncovered that the ministry carried over and spent Shs25.3 billion from the previous financial year without due authorization.

The Ministry of Water and Environment has come under intense scrutiny from the Public Accounts Committee (PAC) for spending an additional Shs25.3 billion on the Strategic Towns Water Supply and Sanitation Project without seeking parliamentary approval.

Appearing before the committee chaired by Hon. Muwanga Kivumbi on Tuesday, 11 March 2024, ministry officials, led by Permanent Secretary Alfred Okot, struggled to justify why they bypassed the mandatory supplementary budget request process for the extra expenditure.

An audit for the year ending December 2024 uncovered that the ministry carried over and spent Shs25.3 billion from the previous financial year without due authorization. The project initially had an approved external financing budget of Shs22.7 billion but ended up receiving Shs48.01 billion, bringing the total available funds for expenditure to Shs58.1 billion.

According to the ministry’s Accounting Officer, the over-receipt of funds stemmed from direct donor payments to consultants and contractors. The Project Manager for Strategic Towns Water Supply and Sanitation, Felix Twinomucunguzi, attributed the financial irregularities to delays caused by the COVID-19 pandemic, which disrupted both project timelines and budgetary allocations. He explained that as activities picked up in subsequent years, expenditures exceeded the initially allocated budget.

However, Hon. Kivumbi rejected this reasoning, emphasizing that the law requires all additional expenditures beyond approved budgets to be subjected to parliamentary scrutiny through a supplementary request. “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 stated.

Hon. Jessica Ababiku (NRM, Adjumani District Woman Representative) questioned why the ministry failed to disclose critical external factors such as the COVID-19 pandemic and the Russia-Ukraine war in their audit reports. “Why didn’t you avail all these nitty-gritties to the auditors?” she asked.

Twinomucunguzi admitted to inconsistencies in the expenditure breakdown, explaining that the additional funds were allocated to pre-contract activities, including compensation and logistical adjustments. However, committee members dismissed his explanation, reiterating that all expenditures beyond the approved budget required parliamentary approval.

Under Secretary Emmanuel Mugunga attempted to downplay the financial concerns, asserting that the funds in question were not newly acquired 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 argued.

Kivumbi, however, refuted this claim, citing the Public Finance Management Act, which mandates that any unspent funds must either be included in the subsequent budget cycle or reallocated through a supplementary request. “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 maintained.

In response, the committee directed the ministry to provide a comprehensive breakdown of the expenditure and a formal explanation as to why a supplementary budget request was never submitted. Failure to comply, they warned, could lead to further accountability measures against the responsible officials.

Meanwhile, the committee also addressed stalled projects under the ministry’s oversight. Twinomucunguzi noted that global disruptions caused by COVID-19 and the Russia-Ukraine war significantly impacted project operations. When asked to explain the delays, he pointed out that critical supplies, particularly steel pipes sourced from China and India, had been affected due to production setbacks in those countries.

The committee remains firm on ensuring accountability for the ministry’s financial mismanagement and has insisted on detailed financial records to ascertain the full extent of unauthorized expenditure.