Last week, we compiled and analyzed eight of 16 key decisions that stalled the Kibuye-Busega-Mpigi expressway from conception in 2015 to how the project was bungled up.
Part I traced eight decisions from 2015 to the award. Part II follows the other eight, from the signature that put the contractor on a road nobody tendered, to the financier’s finding that the contract it is working under was never cleared.
Seven failed. One passed, with Shs 1.3tn hanging on a document no one has signed. In this second part of the chronological analysis, DAVID LUMU delves into the other eight decisions that highlight the moment the Shs 547bn project escalated into a possible Shs 1.3tn national debt with potential to cripple the economy
DECISION 9: Contracts Committee approval of the evaluation report and award
On May 8, 2018, the Unra contracts committee chaired by Isaac Wani, who also doubled as the Unra director Network Planning and Engineering (DNPE), approved the evaluation report and the recommendation for award of the civil works contract, on the original design.
Incidentally, Wani was the officer who had signed the memorandum superseding the original design on October 13, 2017.
Status: FAILED. The award was approved on a design Wani, the chair of the approving committee, had personally replaced without alerting the stakeholders.
DECISION 10: Contract signature
On June 18, 2019, Allen Kagina, the Unra executive director, executed the civil works contract at Shs 547 billion with CCECC in joint venture with China Railway 19th Bureau Group.
Preceding the date of signature, the expressway alignment had been changed 20 months earlier; the supervision consultant had been redesigning the project on the new alignment for five months and the accounting officer had approved the Resettlement Action Plan (RAP) expenditure on the new alignment 13 months earlier.
Status: FAILED. Amidst all the changes, the contractor and other would-be bidders were not aware of it.
DECISION 11: The variation procedure, before implementation
Under the International Federation of Consulting Engineers (FIDIC) sub-clause 13.1 and 13.3, and Public Procurement and Regulation 55 of the Disposal of Public Assets Authority (PPDA) (Contracts regulations), a change of this magnitude required a variation instruction, a priced proposal, a contract amendment as well as a contracts committee review on top of the financier’s prior no-objection before the contractor is put to work on the new scope.
In this case, Sam Muhoozi, the director Roads and Bridges Development (DRBD), wrote on July 10, 2019 directly to the contractor, CCECC and China Railway 19th Bureau, forwarding the revised alignment “to enable you plan for mobilization,” 22 days after contract signature.
The consultant was only copied. On December 19, 2019, Muhoozi asked Wani, acting as executive director, to approve issuing drawings. He signed the same day. Status: FAILED. Muhoozi identified the legal requirement in writing and then asked to be excused from it.
Wani excused it. This is the act that converted a procurement defect into a construction liability. From this date, the works on the ground diverged from the contract on the file, and every month thereafter built the contractor’s case that the employer accepted the new scope by conduct.
DECISION 12: The Independent Design Checker
Between June 2, 2021 through June 8, 2021 and June 30, 2021, there was an independent check on a design whose cost was about to be set by a contractor with no competitor. On June 2, 2021, Patrick Muleme, Unra’s head of Design, wrote through Wani to Muhoozi, titled “Approval of Design Review Reports”: no objection to the final design, with four conditions.
The third: “we advise you to consider engaging an independent design checker to provide additional review and advise, for the complex parts of the project to ensure value for money.”
Wani countersigned on June 8, 2021; the conditions became his.
Status: FAILED. Three offices recommended the check in writing across nine weeks. Not done. Four months later the contractor named its price.
DECISION 13: Accounting Officer no objection to the Final Design Update
On October 8, 2021, Kagina, through a letter UNRA/PR152/SRVCS/BME/200 to the Engineer (Dohwa JV), raised a no-objection to the final design update.
“You are further advised to seek the contractor’s proposal for executing the varied works in the updated design pursuant to clause 13 (variations) of the conditions of contract.” Put simply, the cost carried by that approved design was now Shs 680bn.
Status: PERFORMED. The decision functioned. The employer approved a design, and that design carried a cost of Shs 680 billion , which sits inside the statutory ceiling, by Shs 4.43 billion.
This is the second of the two decisions that functioned. The Employer’s own approved professional estimate for the realigned road was lawful. It was 24.2 per cent above the tendered price.
The ceiling is 25 per cent. Then, in the same letter, the Unra instructed the engineer to go and ask the contractor what it would cost. Sixty-one days later, on December 8, 2021, the contractor wrote back to claim Shs 1.3 billion.
Nothing was designed in those 61 days and nothing was added. For perspective, the difference between Unra’s figure and the contractor’s, Shs 628bn, is not engineering. It is the price of having no second bidder.
DECISION 14: The second drawings authorisation
On December 21, 2021, project manager Ian Bakiza wrote to Kagina through Muhoozi’s directorate, citing Regulation 55(5), the 25 per cent cap. The contractor’s proposal “exceeds the 25% increase threshold and accordingly is not supported under the current PPDA law.”
It offered three lawful exits. On January 17, 2022 Kagina chaired a meeting on the Shs 1.3tn figure and resolved to instruct works at contract rates. A deferral, not a cure. On February 8, 2022 DRBD sought approval for km 8+700 to 21+000.
Kagina signed the same day: 12.3km more road, seven weeks after being told the price was unlawful.
Status: FAILED. At Decision 11 the illegality was implicit. At Decision 14 it was spelled out in the file, by number.
DECISION 15: Board oversight
The board woke up on January 31, 2022, and ordered its Technical Committee to test whether due process had been followed.
It sat on March 11 and July 20 with Kagina, Wani, Muhoozi and Muleme, reporting in September 2022: the accounting officer was never specifically asked to approve the change; parts of Management’s account were false.
Kagina’s October 27, 2022 memo demanded a clarification report; Management’s answer was the November paper, “Process of Design Change”, written by those whose process was in question.
So: 52 months after the switch, 45 months after award, 25 months after the contractor moved, one month after the price. UNRA’s Design Policy only came in September 2022, five years late.
Status: FAILED.
Board asleep 2017–2021; awoke when the cost implications had already arrived, and after the money had moved.
DECISION 16: The financier’s prior review, and the variation order
Fast forward to January, 2024, when Unra made an additional financing request up to July, 2024 during auditing. It came to light that under the AfDB procurement framework, any substantial modification of the scope of services or other significant changes to the terms and conditions of the contract must be subjected to AfDB’s prior review before agreeing with the contractor.
So, the AfDB audit report of July, 2024 discovered that: “Since a major restructuring was introduced during the design review, the contractor is currently working under a modified contract, which was not reviewed and not cleared by AfDB… This is a breach of the loan agreement provisions.”
Unra’s management response, inside that audit report, confirmed the formal request “was supposed to be made after establishing the cost implication”; an additional-financing request went in January, 2024; the revised price to follow August, 2024. It was “deemed prudent to let the contractor proceed”.
Built first, priced later, lender told last. However, as at the date of the financier’s audit, more than four and a half years after the contractor was put on the new alignment with no variation order signed, no contract amendment executed, and no AfDB clearance obtained.
Status: FAILED. This is the only key decision amongst the 16 that has not yet closed. The contractor has built a road with no lawful instrument. Unra was abolished in December 2024; the liability passed to the Works ministry.
Until someone signs, Shs 1.3tn is a demand. Contractor: 1.72tn; engineer: 1.35tn; Unra’s design: 680bn. The day the ministry signs, it becomes a debt.