COTTON CASH TRAP! Sabune Era Haunts CDO As Sh15bn Stuck, “Unknown” Land Shocker & Staff Pay Chaos Exposed
A damning Auditor General’s 2025 report has ripped the lid off a tangled web of financial exposure, administrative lapses and shocking oversights at the Cotton Development Organisation, leaving the legacy of long-serving former Managing Director Jolly K. Sabune under intense scrutiny as billions hang in the balance.
The auditor review, covering the six-month period from 1st July to December 2024, followed RAPEX reforms, which saw CDO sent back to the mother Ministry of Agriculture, Animal Industry and Fisheries.
But instead of a smooth transition, what emerges is a story of unfinished business, loose ends and glaring accountability gaps.
At the heart of the audit storm is a massive revolving fund for cotton value addition, first approved in the 2014/2015 financial year. The Auditor General notes that “To date, UGX.28Bn has been invested in this fund and used to maintain buffer stock.” Yet despite this heavy investment, the situation on the ground raises more questions than answers. At the time of closure, CDO was sitting on buffer stock worth UGX.7.73Bn and cash of UGX.5.045Bn parked on a buffer stock account in DFCU Bank, even as billions remained tied up elsewhere.
In a jaw-dropping revelation, the report states that “At the time of closure, M/s Fine Spinners, one of the beneficiaries from the buffer stock, owed CDO repayments for buffer stock worth UGX.15.15Bn which is locked up in semi-finished, finished goods and credit lines authorised by MoFPED over the last four (4) years.” The staggering amount, effectively frozen in production chains and credit arrangements, has triggered alarm over recovery prospects and oversight failures.
Land management at CDO reads like a script straight out of a governance nightmare. While the organisation officially owns three parcels of land, the Auditor General found that one prime piece in Buruli, Masindi Municipality is lying idle and unfenced, exposed to encroachment and misuse. But the real shocker comes in the discovery that “CDO owns an additional seven (7) pieces of land measuring 5,605.5 Hectares in Mubende and Masindi districts that were not disclosed in the assets register, hand over report and financial statements, due to the fact that management was not aware of the land.” Incredibly, thousands of hectares simply slipped through the cracks, unknown to those entrusted with managing them.
Financial constraints also cast a long shadow over operations. Out of an approved budget of UGX.5.08Bn, only UGX.2.63Bn was released for the six-month period, leaving a shortfall of UGX.2.45Bn that directly affected implementation of activities. Despite this, the report acknowledges that eleven outputs tied to eight activities worth UGX.2.63Bn were fully implemented, a rare bright spot in an otherwise troubling assessment.
The human cost of the transition is equally glaring. The Auditor General observed that “30 employees of CDO were terminated and therefore entitled to compensation of UGX.881.91Mn. UGX.806.24Mn was paid leaving an unpaid balance of UGX.75.67Mn.”
Even more controversially, “Contrary to the RAPEX guidelines, eight (8) former staff of CDO who were subsequently absorbed by MAAIF were paid terminal benefits amounting to UGX.50.08Mn,” raising red flags about compliance with reform guidelines.
Meanwhile, another absorbed staff member claimed UGX.65.59Mn in terminal benefits but was left unpaid, further exposing inconsistencies in handling staff entitlements.
The transition to the Ministry of Agriculture has itself been anything but seamless. Although eight key functions were officially mainstreamed, the report reveals that some remain unimplemented due to staffing gaps. The consequences are already being felt, with “delays by the Ministry to implement seven (7) key activities in the production, marketing, ginning, seed processing, and classing of cotton,” all critical to a successful cotton season.
At the Pajule processing plant, the situation bordered on crisis, with all key staff laid off and yet to be replaced even as the harvest season kicked off in August 2025.
Further exposing weak safeguards, the Auditor General flagged that CDO installed key equipment at the cotton seed processing station in Kasese ginnery owned by Nyakatonzi Growers Cooperative Union Limited, but “there was no formal agreement between CDO and NGCUL to ensure that the equipment is protected against loss and other risks.” In essence, valuable government equipment was deployed without binding protections, leaving it vulnerable.
Even in accountability follow-ups, progress appears sluggish. The report notes that CDO “fully implemented four (4) recommendations and partially implemented two (2) recommendations” from earlier Auditor General findings, suggesting a pattern of incomplete corrective action.
As the RAPEX reforms continue to reshape government agencies, the CDO case now stands as a stark warning of what can go wrong when oversight weakens and transitions are poorly managed. With billions tied up, land unaccounted for, staff grievances unresolved and critical functions lagging, pressure is mounting on those in charge to explain how such glaring gaps were allowed to persist—and who will ultimately take responsibility for the mess left behind by Sabune.
By Press time, I was not clear whether she was retained by MAAIF or shown exit but RedPepper will keep you updated.
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