Six NSSF board members testify against Kyayonka on Umeme deal

Mr Ivan Kyayonka, NSSF board chairperson. FILE PHOTO 

By Yasiin Mugerwa

In Summary

We told him! Six board members tell MPs that although the Umeme deal looked attractive, they warned Mr Kyayonka that all procedures should first be followed as Solicitor General had earlier advised.

PARLIAMENT.
Six of the National Social Security Fund’s 10-member board yesterday disowned their chairman, Mr Ivan Kyayonka, and accused him of taking “unilateral decisions” in the disputed purchase of Umeme shares.

The members also told Parliament’s NSSF inquiry into allegations of nepotism, irregularities in the purchase of Umeme shares and disposal of assets that the former managing director, Mr Richard Byarugaba, was “overrun” by his juniors.

Mr Christopher Kahirita recounted how Mr Byarugaba, Ms Geraldine Ssali (former deputy MD now acting MD) and the former corporation secretary, Mr David Nambale, frequently clashed. “These people had a lot of verbal fights and at one time when we (the board) were considering the Pension Towers project, they started accusing each other that one of them had stolen the file; that they found him in the lift taking the file,” Mr Kahirita said.

Byarugaba’s role
He said as an elder he offered to arbitrate without success. They blamed Mr Byarugaba for failing to assert his authority and getting consumed by office politics.

Mr Byarugaba yesterday denied this, observing: “They can say all they want; they can’t take my success away. I left the Fund a much better place for customers, the members and members of staff.”
Mr Nambale was not available for comment.
Labour and Gender Permanent Secretary Pius Bigirimana, who appeared separately, agreed that the NSSF board didn’t approve the Umeme purchase.

“Investing in Umeme was good business and was very attractive but I told them there was need to get clearance from the minister and the Solicitor General,” Mr Bigirimana said. “The chairperson told us they had talked with the minister and she gave him a verbal clearance. I did not find it appropriate for me to give my blessings on verbal clearance. That’s why I objected and put my position in writing.”

“This was a marathon purchase and there was no time for consultations… I remember asking them: Is the house on fire? Can’t we buy these shares after the clearance of the board, the minister and the Solicitor General? I was told if we miss the May 9 purchase, either we forget or buy at a higher price.”

The board members said although the deal looked attractive, they warned Mr Kyayonka that all procedures should first be followed as Solicitor General had earlier advised. The SG had granted the approval subject to the board and the minister’s endorsement.

“The decision to invest in especially Umeme 2 was approved by the board on a simple majority of 6:5. The presence of dissenting views by some board members does not make the decision of the board illegal. The dissenting members of the board are bound by the board principle of collective responsibility.”
Edgar Birungi, NSSF’s head of marketing and communication

They maintained that the minister in her May 13 letter to Mr Kyayonka declined to grant immediate approval. “During the board meeting, five of us did not agree to this transaction and there was no voting and when we got information that the board chairman had decided to proceed in an unaccepted manner, we put it in writing to the chairman and sent a copy to the minister,” Mr Richard Bigirwa said.

“Even when they bought the first shares worth Shs36.1 billion under IPO, it was between Kyayonka and Byarugaba. We were not consulted and we had to call a meeting at Serena Hotel in Kampala where the board chairman apologised.”

Mr Kyayonka has previously said Section 30 of the NSSF Act (1985) allows the Fund to make investments of all monies in the Fund as may be determined by the board in consultation with the minister. He is expected to appear before the committee next week. He has previously said the Umeme investment was approved by the board in consultation with the Minister of Finance in line with Section 30 of the NSSF Act.