Parliament Approves UGX 500 Billion KCCA Loan

Parliament yesterday morning approved Ugx 500 billion loan seeking to finance the second phase of the Kampala Institutional and Infrastructure Development Project (KIIDP2).

Once accessed, the loan will enable Kampala Capital City Authority (KCCA) implement the reconstruction of Mambule Road, linking Kalerwe to Bwaise, upgrade Makerere Hill Road, Bakuli-Nakulabye-Kasubi-Northern Bypass Road (from Bakuli to Northern Bypass) and Kira Road (from Kira Road Police to Kabira Junction). Part of it will also be used to implement the signalization of Bwaise and Fairway Junctions.

The approval followed a heated debate in the House mounted by members of the opposition who attempted to block the facility claiming that; “with the absence of the Lord Mayor in office, KCCA has no capacity to manage public resources.”

Butambala County MP Muhammad Muwanga Kivumbi said that Parliament had allowed impunity to deny Kampala Capital City a political leader. “There is no way we can authorize KCCA to borrow without anyone to monitor and provide oversight for the money they are borrowing”, kivumbi said.

But State Minister for Finance Aston Kajara pleaded with the MPs to approve the loan saying that it was already sanctioned by the World Bank which has been threatening to channel it elsewhere if Uganda does not show interest. He said that the loan access only awaited Parliamentary Approval.

The second attempt to block the acquisition was based on the absence of quorum. Rule 23 of Parliament’s Rules of Procedure provide that the quorum of parliament shall be one third of all members of parliament entitled to vote. It further provides that the quorum prescribed shall be required at the time when parliament is voting on any question.

This move was aimed by Busiro East MP Medard Ssegona;

Deputy Speaker Jacob Oulanyah suspended the sitting for 15minutes to allow whips to mobilize members for a vote on the matter. However, at the lapse of 15 minutes, Parliament still had not attained the required quorum forcing Oulanyah  adjourn the House for another 1 hour to allow Prime Minister Ruhakana Rugunda discuss the matter with the Opposition and pave a way forward.

Later Prime Minister Ruhakana Rugunda told parliament that the two sides had agreed that the loan is approved for the good of the city.

The Leader of Opposition Wafula Oguttu noted that the Opposition was not against the loan but that it was concerned with the management of the facility in the absence of the political arm of the Authority.

The loan, from the International Development Association (IDA) of the World Bank Group has a repayment period of 30 years and comes with a grace period of 10 years.

The Loan was scrutinized by Parliament’s Committee on National Economy chaired by MP Xavier Kyooma which recommended that Parliament approves the loan since it is in line with Vision 2040 and the National Development Plan (NDP).

There had been delays in implementation of project activities due to delays in obtaining Parliamentary approval of the credit, delays in timely procurement, delays in compensating the affected persons, and challenges associated with contract management.

As a consequent, the project closing date was first extended by 24 months because of the one year delay in project effectiveness occasioned by the Constitutional requirement for obtaining Parliamentary approval for the credit and delays in verification and payment of compensation to the project affected persons (PAPs), as well as the challenges of getting utility bodies to relocate their services in order to give right of way for civil works.

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