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MPs Grill NSSF Over Deficit

April 3, 1998

Members of Parliament yesterday quizzed National Social Security Fund (NSSF) officials over the
spending of workers' savings on the corporation's administrative costs.

The fund has accumulated a deficit of sh8m since 1996, yet it collects about sh2.3b as workers'
contributions.

The managing director, Mr. Abel Katembwe, the corporation secretary, John Baptist Kakooza, and a
team of NSSF accountants and auditors appeared before the parliamentary committee on commissions
and statutory enterprises to answer queries raised by the Auditor General's report.

Mr. Patrick Kiggundu (Kyotera), Mr. Manuel Pinto (Kakuuto) and Mr. Benedict Mutyaba (Makindye East)
said the NSSF management was violating the law by using workers' savings for operational costs.

"You're now eating into the funds deposited by workers to pay staff. The Act does not allow you to do
that," Kiggundu said.

Kakooza said: "There is no law in the Act that says you cannot use members contributions for operational
purposes.

There is no direct contravention of the law here." Kiggundu also queried a loan extended by the NSSF to
the Milton Obote Foundation (MOF) in 1970 to complete Uganda House.

Pinto said: "We shall compel MOF to give us documents on how that loan was acquired and why it has
not been paid." The NSSF also extended a sh99m loan to the National Organisation of Trade Unions,
which has not been paid back.

The ministry of finance also owes the NSSF over sh565m, accumulated since the early 1970s. Katembwe
said: "It is true our investment income has been less than our operational costs. But this was brought by
the fact that when NSSF became a corporation in 1995, it was not given a start-up fund. We have been
forced to utilise this money to recruit highly-qualified staff to manage the corporation." Katembwe said
due to pressure in the press about making regular statements to the public, the NSSF has had to spend
money on computers and other equipment.

"But we are now expanding our capital base and income is increasing, soon we shall be able to cover the
deficit," he said.
===============
Embassy House: NSSF, Lawyers Weigh Bill

December 9, 1997

The 562 m/= bill, for legal work done in June on behalf of the National Social Security Fund (NSSF) by
Isanga Musumba and Company Advocates is open to negotiation and not a final figure, both parties
have said.

The law firm scrutinised the title deeds and other relevant documents of Embassy House and UDC
House and drew up purchase agreements for both properties.

NSSF had planned to buy the two buildings but Parliament blocked the privatisation of the Uganda
Consolidated Properties Ltd., who are the owners and the sale was postponed. "The issue is that is this
(562 m/=) a fair charge? We have disputed it and have asked them to look for a cheaper method of billing
us," said Abel Katembwe, NSSF Managing Director.

He was however optimistic that a more realistic position would be reached.

"After all these are public funds we are dealing with, we cannot just give them away," he said. Isanga
Musumba a senior partner in the law firm said the two parties had been out of touch for some time but
said, "The options are open. This really is a matter between the client and the solicitor which will be
settled," Musumba, who is also the MP for Buzaya told The New Vision. The Monitor last month reported
NSSF Corporation Secretary John Kakooza as writing in a September 21st letter after receiving the bill
that whereas the billing was in line with the law. NSSF requested a downward re vision of the sum.

===========

NSSF boss' hand deep in Alcon deal

April 29, 1998

The Managing Director of the National Social Security Fund (NSSF), Abel Katembwe was yesterday said
to have been a kingpin in influencing his Board of Directors to award the contentious workers' house
contract to Alcon International.

"You had a clearly identified crucial role of advising the board to take on Alcon," Manuel Pinto said during
a probe session after reading a Board minute. According to records, Katembwe headed the negotiation
committee that sought to have Alcon tone down its bid of US$ 18m to US$ 16m despite the fact that
Concorp the second lowest bidder with US$ 16m after Roko Construction was available. After Roko fell
out because it wasn't willing to co-finance the project, there remained two pre- qualified bidders,
Concorp and Alcon both willing to co-finance to a certain to degree. The MPs discovered that despite
the negative evaluation Alcon was getting the Board continued to favour it.

Even the intelligence report from the Uganda High Commission in London which described Alcon as a
company with negative financial strength didn't shake the Board's position on Alcon. The Board wrote
back to London saying the mission's move was a good effort "but it wasn't enough of what the Board
wanted," a Board minute revealed.

Soon the Board dispatched a team of two to Kenya which came back full of praises for the Alcon work.
The MPs also took the MD to task to explain why he was so interested in Alcon reducing its bid. Pinto
asked whether when Katembwe by pressing a reduction on the bid he wanted to reduce on the quality of
work Alcon was planning to do. "Someone had quoted, why reduce?" he asked. Pascal Mukasa wondered
why Concorp wasn't given the tender yet it had been pre-qualified and therefore deemed fit to do the
job.

The MPs also learnt from the deputy MD, Dr Yoram Barongo that the Board sought the Corporation
Secretary, John Kakooza's opinion after the decision to award the contract had been taken. Kakooza
then is said to have had reservations about Alcon. He repeated the reservations yesterday. He said the
people posing as directors of Alcon never produced even todate any document about their company's
incorporation. No bank records and the men at the time negotiating with NSSF, when

checked out were proven not to be the original directors of Alcon international. "For me it would have
been a negative vote," Kakooza said. "Mr MD you have a lot to tell us before the contract was
awarded...there's a feeling that the award was subject to some influence," Pinto rubbed in. But the MD
said he was mandated to head the negotiation committee by the Board. He said he advised the Board to
have Alcon scale down its bid. Katembwe said the role of management is basically to make
recommendations to the Board and its up to the board to interpret and make decisions. Katembwe also
dismissed insinuations that the Board's decision to take on Alcon could have been influenced by Eteker
Ejalu.


__________
bwanika

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