Addressing the ongoing controversy, likened to a messy divorce or lovers quarrel, Energy Minister Ruth Nankabirwa reaffirmed the government’s commitment to paying only the buyout amount determined by the Auditor General for electricity distributor Umeme.
Setting the stage for a potential dispute, as Umeme is reportedly demanding a significantly higher sum, Nankabirwa confirmed that the government has received the Auditor General’s report.
“We as Government are in receipt of this from @UmemeLtd,” she disclosed, citing the special audit findings.
Whereas the Auditor General’s report values the buyout at $118 million (Shs430 billion), Umeme sought more than the $190 million (Shs700 billion) initially approved.
This discrepancy has sparked concerns over the financial aspects of the deal.
“The Auditor General has audited and determined $118 million as the buyout amount,” Nankabirwa asserted, making it clear that the government intends to adhere to this independent assessment.
This position comes amid reports that Umeme had initially submitted a buyout estimate of $234 million, which the government reviewed through the Auditor General.
The substantial gap between Umeme’s valuation and the government’s assessment suggests a potential impasse in finalizing the buyout price.
While assuring that the government expects to finalize the handover to Umeme by April 1, the Minister acknowledged Umeme’s right to challenge the decision.
“We expect by 1st April to have handed over… @UmemeLtd is free to petition!” she noted.
Umeme has showed that it will only transfer the electricity distribution system to the government upon receiving the agreed buyout amount.
With the 20-year concession agreement between the government and Umeme set to expire on February 28, 2025, urgency surrounds the buyout negotiations.
The agreed amount must be paid within 30 days, with a deadline of March 31, 2025. Any delay could result in penalty interest for the government under the terms of the concession.
With the Minister standing firm on the Auditor General’s valuation, Umeme now faces a critical decision—either accept the government’s offer or seek alternative recourse, potentially leading to further legal or financial negotiations.
The coming days will be crucial in determining the final buyout price and ensuring a smooth transition of Uganda’s electricity distribution infrastructure
