President delivers on promised debt bailout plan
MPs facing jail because of their huge debts are to get first priority after President Museveni agreed to a Shs 41.2bn bailout plan.
The Observer has learnt that Museveni recently directed his aide, Brig Proscovia Nalweyiso, and Government Chief Whip Justine Kasule Lumumba to expedite the rescue plan, especially after Bungokho North MP Yahaya Gudoi was arrested and jailed for failing to clear a debt owed to a moneylender.
In March, The Observer reported that Museveni was considering giving each MP up to Shs 150m to save the legislators from crippling debts. But critics attacked the plan as another example of the party in government misusing public resources.
It has now emerged that several MPs have already got the money.
Sources familiar with the plan have told us that each beneficiary is entitled to between Shs 110 million and Shs 130 million. The MPs have been categorised in three groups, with the ‘chronically indebted’ to be considered first. This category includes MPs who face imminent jail as moneylenders close in on them.
The initial plan was to bail out only members in this category but it was feared that if only a few benefited, others would make noise, said an MP who claimed to have been called by Lumumba to get his share.
“They decided to give all MPs beginning with those who are badly off, and then to those in a fair position, and lastly to even the ones without debt,” the MP said.
With Parliament having 375 MPs (excluding the ex-officio), Museveni looks headed to pay out at least Shs 41.2bn. The Observer has learnt that approximately 70 MPs, 18 of them members of the opposition, have so far received the money.
“I was first alerted by a female MP from the east who borrowed from a moneylender to mobilise for the party. She told me that she had got [money], and another one told me she had been lined up to get the money last week,” an MP told us on Friday.
Another MP, who declined to be named, revealed that the NRM caucus leaders are calling one by one at parliament.
“But no one is going to confess to you that they have received money,” the MP said.
“But it is true, the money is there.”
Pleading with this writer to abandon the story, the MP further said:
“Members are badly off; why don’t you leave them to benefit because at one time you may also end up here and find yourself in a similar situation [indebted]. Your colleague, Ssemujju [Ibrahim Nganda], for example, was like you; maybe he never thought that at one time he would be an MP.”
Making their case for a bailout earlier on, the MPs told President Museveni that their excessive borrowing results from a broken service delivery system, which sees voters turning to them to bridge gaps.
“We have too many demands in the constituencies, we have too many projects to fundraise for, then you get individual demands from your constituents and right now, there are people campaigning against us,” one MP said.
Susan Amero (Amuria Woman), one of the MPs reported to have been bailed out, denied it when we spoke to her on Friday.
“I am choking on debts and have decided to lead my miserable life with Shs 3m every month because it is what remains after the deductions,” she said.
“I can’t even travel to the constituency because I don’t have money to fuel my car,” Amero added.
Lumumba couldn’t be reached on Friday and Saturday. But the NRM caucus vice chairman David Bahati (Ndorwa West) said no MP had been given money.
“As far as our office is concerned, that is mere street talk and we have said we are not going to waste time on that,” Bahati said on Friday.
“It is just loose talk. We are not aware that any MP has been given that money.”
Despite the vehement NRM caucus denial, several MPs told The Observer that the money is being distributed.
“I have heard about it, and if the money is selectively being given to individuals without coming through the normal procedures, that is bribery,” said Rukiga MP Jack Sabiiti.
“We should not accept such; it is dangerous for society and parliament, and it should be condemned,” Sabiiti added.
On the sidelines of the Kyankwanzi retreat in February 2014, President Museveni met some NRM caucus leaders and parliamentary commissioners. They persuaded him to embrace the loan buy-off deal negotiated by the parliamentary commission with a Chinese firm.
The commission wanted to secure a government guarantee for Exim Bank of China to fund the Chinese firm that was to buy off the loans and revalue them at lower rates. Museveni, however, blocked the move, saying if his government guaranteed individuals’ loans, he would be looked at internationally as an unserious leader.
In Kyankwanzi, however, Museveni reportedly warmed up to the idea, especially after learning that the MPs were considering another bailout option reportedly by Amama Mbabazi, the prime minister and secretary general. On March 10, during a caucus meeting at State House, Museveni told the MPs that he had agreed to “the rescue plan.”
The MPs hoped then that they would get the money by the end of March. Indeed, some MPs approached the Office of the President in June, seeking answers. It now appears that July and August have brought good tidings.