The Uganda National Roads Authority (UNRA), has said that it is paying project contractors who have not been paid for their work up to Sh342 million per day in interest.
The UNRA Executive Director, Allen Kagina, made this admission on Tuesday when she testified before parliament’s finance committee regarding the effects of the insufficient cash limit for the first half of the financial year 2022–2023.
According to Kagina, UNRA ended the financial year with total arrears of Shs528 billion, including Shs89.5 billion for road maintenance, which is attracting interest.
She said that the government released Shs689 billion against a requirement of Shs1.2 trillion.
“The arrears position has increased by 145.75 percent from Shs215 billion at the end of the Financial Year 2020/21 to Shs528 billion at the end of the Financial Year 2021/2022. This is largely attributed to the budget suppression at 77 per cent of the approved Government of Uganda budget that was released,” Kagina said.
Kagina said that if they didn’t pay the debt, they would have to pay useless expenses like interest costs, idle equipment, and less work for the contractors.
She further told the MPs that this will also lead to the failure to acquire land for the different projects in time and the failure to sign contracts whose procurements have been completed.