A total of Shs 13 billion has been withdrawn from the bank accounts of Kampala Capital City Authority (KCCA) on court orders.
KCCA acting treasury director, Julius Kabugo, says the money was withdrawn from the institution's account in 2017 after the issuance of garnishee orders. A garnishee order is a legal notice the court issues that allows the creditor to collect the amount from the debtor's bank account.
Kabugo says the money was part of the compensations that the institution is supposed to pay as result of lost litigations. He says a huge volume of legal cases is one of the challenges that the institution is facing. Kabugo says creditors usually target the KCCA's revenue account where taxes are deposited.
"Ultimately, this affects implementation of various planned activities at the beginning of the financial year," he says.
Kabugo says KCCA has many litigations in courts which are costly. For instance, during the 2018/19 financial year, Kabugo says the legal directorate has requested for Shs 40 billion shillings to be spent on litigations.
"The cost of litigation is very high due to inherited legal cases. Every day we have more cases coming up," he says.
When Kabugo made the disclosure during a council meeting on Friday, he was tasked by the Lord Mayor Erias Lukwago to furnish councillors with details of when the garnishee orders were issued, when the money was withdrawn and who are the creditors.
The council was discussing the institution's budget for financial year 2018/19. The council resumes today to continue scrutinising the budget.