CALL FOR TANZANIAN ELECTION WINNER TO ABOLISH UNFAIR TAX ANOMALIES

Sylvia Nankya

Christian Aid is calling on the winner of this Sunday’s general election in Tanzania to commit to ending tax anomalies that have deprived a country rich in mineral resources of badly needed revenue that could have been spent on schools, hospitals and other infrastructure improvements.


With two former Government ministers and a permanent secretary currently facing corruption allegations in court, tackling financial malfeasance has emerged as a major election issue.


A recent index drawn up by the Revenue Watch Institute put Tanzania near the bottom of a global list in terms of the transparency of its mining and minerals deals – with only a few countries such as the Democratic Republic of Congo and Equatorial Guinea having a lower score.


A recent report commissioned by Christian Aid and a number of Tanzanian organisations estimated that the country was deprived of revenue from gold mining companies amounting to at least $265.5m from low royalties and lost taxes between 2000 and 2008.

The report, ‘A Golden Opportunity? How Tanzania is failing to benefit from gold mining’ said gold mining was the fastest growing sector of Tanzania’s economy, yet ordinary Tanzanians were not benefiting from the boom due to excessively low royalty rates and government corporation tax concessions. The Tanzanian press has alleged that some companies are guilty of tax evasion.

Christian Aid East Africa country manager, Dereje Alemayehu said: ‘Tanzania one of the few African countries without internal conflicts, but the ruling elite are not in a position to make effective use of this political capital to lead the country out of poverty because it has allowed the leakage of valuable resources from the country by complicity or through ineffectiveness.

‘If this election is not going to be yet another contest between factions of the ruling elite over the spoils of the state, the new government must at least enhance domestic resource mobilisation by reducing tax expenditure, discarding a tax policy which provides huge exemptions for the wealthy and entails extorting from the poor, as well as being vigilant against tax evasion and aggressive tax avoidance.’

Key Kenyan Minister Steps aside over embassy allegations

Kenya's foreign minister has stepped aside amid a growing scandal involving the alleged misuse of his ministry's funds for several land deals abroad.

Moses Wetangula, who maintains his innocence, made his announcement as MPs were set to vote on his suspension.

A parliamentary report recommended his removal until claims over deals for new embassies were fully investigated.

Mr Wetangula is a key cabinet figure and helped to form the coalition in 2008 that ended the post-poll violence.

Kenya's new constitution sparks hopes of rebirth Country profile: Kenya The scandal is the latest in a series of high-level corruption allegations involving government officials.

'Haunting and tormenting'

Mr Wetangula told reporters in the capital, Nairobi, that he felt he was being hounded from office.

"I have made a personal decision to step aside as minister of foreign affairs to give room and pleasure to those who have been haunting and tormenting me, and to give room for the investigation," he said.

"I can assure you I will be back to the cabinet once the investigations are completed because I know I am innocent."

According to a parliamentary committee report, Kenya lost $14m (£8.8m) during a land deal in Japan.

The foreign ministry is alleged to have refused an offer of land from the Japanese government in central Tokyo for a new embassy, opting instead for a building further away, against the advice of an estate agency.

Money was also allegedly lost on embassy deals in Egypt, Nigeria, Pakistan and Belgium.

Mr Wetangula, who will remain on half salary until the investigation is completed, is the latest high-profile figure to step aside because of corruption allegations.

Last week, Kenya's Higher Education Minister William Ruto was suspended, after a court ruled he must stand trial over corruption allegations.

Speaking at a separate function on Wednesday, President Mwai Kibaki reiterated that his government would not shield corrupt officials.

Donors have long criticised Kenya for failing to tackle corruption.

But correspondents say the passing of a new constitution in August has made it easier for the authorities to fight it.

The new law stipulates that anyone facing criminal charges should stand down from public office.

Kenya mayor arrested over cemetery scandal

Sylvia Nankya;

Kenya's mayor of Nairobi has been arrested for questioning in connection with a scandal over the sale of land for a graveyard in the capital.

Geoffrey Majiwa is the highest official to be arrested over the alleged scam.

Officials are accused of paying $3.6m (£2.4m) of taxpayers' money for the land, which was worth only 10% as much and did not have a title-deed.

Kenya's new constitution sparks hopes of rebirth Country profile: Kenya So far, only 14 junior officials at Nairobi's city council are facing charges.

But Mr Majiwa's arrest comes two days after Kenya Anti-Corruption Commission (KACC) head, Patrick Lumumba, said that having dealt with the "small fish", it was now time for the commission to turn its attention to the "big fish".

The land had been earmarked to replace the Langata cemetery, which is full.

But the rocky land purchased was not even suitable for use as a cemetery, the authorities said.

It is alleged that the land in Nairobi's Machakos district was purchased for 283m Kenyan shillings, when it was worth 24m shillings.

KACC spokesman Nicholas Simani said Mr Majiwa would be charged in court on Tuesday.

Energy Officials Grilled over 10 Billion shillings Loss

Sylvia Nankya,

SIX officials from Bujagali Energy Limited (BEL) and Uganda Electricity Transmission Company Limited (UETCL) were yesterday grilled by MPs for diverting sh10b government funds to their account in Stanbic Bank.
The money was meant for the resettlement and compensation of over 2,600 people affected in the Bujagali Interconnection Project.
The officials included the project director, Glenn Gaydar, transmission line manager John Berry, the accountant, Nora Nakato, Ivan Kwasibwe (BEL), Dennis Makuba (UETCL), and Henry Lwetabe (UETCL).
The officials were handed over to CID at Parliament for further questioning after they failed to explain why BEL withdrew the money from the Government Energy Fund (Escrow account).
According to the MPs, the Government is to spend over sh30b on compensation. Bujagali Energy Limited is working closely with UETCL to manage the development and construction of the power line.
During the meeting with the officials and others from the energy ministry led by the permanent secretary, Fred Kaliisa, MPs on the public accounts committee discovered that in December 2008, BEL invested the money in bank securities without prior approval of UETCL, the implementing agency.
According to Dennis Makuba from UETCL, the money accumulated an interest of sh460m within two years. He said the money was later transferred to the consolidated account in Bank of Uganda in September.
Though deposited on the same date (December 10, 2008), the money was deposited in two instalments of sh5b each at an interest rate of 7.5% and 7%.
The committee was surprised to learn that the interest was, however, never declared in the company’s books of account.
The project director, Glenn Gaydar, explained that: “After the evaluation, there were delays by the Government chief valuer to approve the report. That is why we decided to invest it in short-term investment.”

Makuba said BEL had acknowledged that it was an oversight on their part to invest cash balances in short-term bank securities.
The legislators demanded for an explanation why the company withdrew the money before the actual time for compensation and also why they never sought authority from UETCL.
“This is a serious case of fraud. Did the Government instruct you to invest the money and make profits? Why did you request for money that you were not ready to spend?” committee chairperson Nandala Mafabi asked.
MPs William Nsubuga (NRM), Tindamanyire Kabondo (NRM), Oduman Okello, and Tom Kazibwe (NRM) noted that there was need to monitor the project because the investment will be translated into power tariffs when the project is completed.
“We are afraid that investors are taking us for granted. They only transferred the money because we had summoned them,” Oduman said.
Kaliisa assured the MPs that the interest of Ugandans are being taken care of and clear control measures had been put in place to stop exploitation.

Kenya’s New Constitution Bites; Accused Kenyan minister William Ruto is suspended;

Higher Education minister William Ruto has been suspended from Cabinet; just days after a constitutional court ruled he will face fraud charges.

"Following consultations with the Rt. Hon. Prime Minister, His Excellency the President has stood aside Hon. William S. Ruto, EGH, MP from Office of Minister with immediate effect pending conclusion of the Nairobi Chief Magistrates Case No. 973 of 2004 as allowed by the Nairobi High Court Suit No. 1192/2005 (0S)," said a statement from Kibaki's office.

The President appointed the minister for East African Community Hellen Sambili to Mr Ruto's docket in an acting capacity.

On Friday, a three judge bench ruled that Mr Ruto will face criminal prosecution over a Sh272 million fraud case.

Judges Jeanne Gacheche, Leonard Njagi and Roseline Wendoh said that they were not convinced that any of Mr Ruto’s rights had been infringed because he was still innocent until the trial court proved otherwise.

Mr Ruto and four other persons face fraud charges over the alleged sale of a piece of land in Ngong forest to Kenya Pipeline Company Ltd for a total of Sh272 million.

The minister allegedly received Sh96 million at various intervals during the alleged transaction.

In the case, the Eldoret North MP and Berke Commercial Agencies, a company associated with him, Mr Joshua Kulei, a former aide of retired president Daniel Moi, Mr Sammy Mwaita (Baringo Central MP) and two other firms were sued for allegedly obtaining money from KPC between August 6 and September 6, 2001.

Section 62 of the Anti-corruption and Economic Crimes Act stipulates that “a public officer who is charged with corruption or economic crime shall be suspended at half pay, with effect from the date of the charge.”

Such a suspended public officer continues to receive the full amount of any allowances, according the law. The law now requires that President Kibaki and Prime Minister Raila Odinga move to suspend Mr Ruto until the case against him is determined.

The move to have Mr Ruto step aside comes after Attorney General Amos Wako said that he would advise President Kibaki and Prime Minister Raila Odinga on the next course of action following the court's ruling.

“As you know, I cannot make comments like other ministers and politicians. I have my clients, the two principals, and will advice them as required,” Mr Wako said.

Justice minister Mutula Kilonzo and Gichugu MP Martha Karua had led calls for Mr Ruto to leave office saying that was what the law provided.

On Saturday, Mr Ruto dismissed calls for his resignation saying there was "nothing new" to warrant his stepping aside.

Addressing a news conference at his Jogoo House office on his return from Japan, he said the suit was politically-motivated and questioned why it has been dragging in court for close to seven years.

“It has taken this long so that every year, Kenyans would be reminded that there is a certain case Mr Ruto is facing. But there is nothing new in it,” he said.

“There is a propensity to get me out… I don’t know why.”

In April, Mr Ruto was transferred to the Higher Education Ministry from his Agriculture docket. At the time, he was leading campaigns against the new Constitution.

It will be the second time that Mr Ruto, who belongs to the Orange Democratic Movement (ODM) wing of the coalition government, stands suspended.

In February, PM Odinga suspended Mr Ruto, then Agriculture minister, and Basic Education minister Sam Ongeri to pave way for investigations in their respective ministries for a period of three months.

Cheeye starts 10 year Jail sentence for corruption.

The former head of economic monitoring in the President’s office TEDDY Sezi Cheeye yesterday started serving his 10-year jail term for stealing Global Fund money meant for HIV/AIDS


The Court of Appeal dismissed his appeal. Court said the sentence was too small because his offense was very serious. “The conviction and sentences of the lower court are upheld. He should proceed to serve his sentence,” the judges ruled.

Ironically, the smartly dressed Cheeye had turned up at the Court of Appeal to apply for extension of his bail, only to be told by a clerk that the ruling was to be delivered.

“I am surprised, I had come to extend my bail,” Cheeye told journalists minutes before the ruling.

Cheeye, former, last year got bail from the Court of Appeal, which he had asked to overturn the sentence.

In addition to imprisonment, Cheeye is also to refund sh110m of the sh120m he got from the fund. The High Court convicted Cheeye in April 2009 for embezzling the money and forging accountability for it.

The money came his way through his NGO, the Uganda Centre for Accountability, for purportedly monitoring AIDS activities in Rakai, Kabale, Mbarara and Ntungamo districts.

The money was deposited on the account to which Cheeye was sole signatory and he withdrew all of it in 19 days although he did not monitor any AIDS activities anywhere.

Cheeye’s accountant, Geoffrey Nkurunziza, told the court during the trial that Cheeye instructed him to forge accountability. In one case, Cheeye said he used a caterpillar loader, which uses diesel, to transport people.

Convicting Cheeye, Justice John Bosco Katutsi said: “This type of crime is being committed with impunity! That a caterpillar wheelloader, which uses diesel, this time was using petrol! Is this stupidity or impunity?”

Giving their verdict yesterday, judges of the appeal court, Amos Twinomujuni, Steven Kavuma and Augustine Nshimye Sebuturo, said although Cheeye was a first offender, he was a senior public officer responsible for fighting corruption and should have been the “last person to engage in the criminal activities he was convicted of”.

“He should have led by example. We think the sentences of 10 years and three years were on the lower side. We are content, however, to leave the matter as the learned trial judge, in his wisdom, found suitable. We also uphold the order for compensation,” the judges added.

After the ruling was read, a Police officer swiftly moved to take Cheeye to the cells, but the shocked convict dashed towards his lawyer, Peter Kabatsi, asking if they should appeal. “I think we should,” the lawyer remarked as the policeman grabbed Cheeye enroute to Luzira.

Kabatsi said he had not had formal instructions from Cheeye to appeal yet.

Cheeye had told the Court of Appeal that justice Katutsi was wrong to say he received the sh120m because he relied on uncorroborated evidence of Nkurunziza, whom he described as an accomplice and a liar.

Cheeye also said he did not forge the accounts and that the judgement was too harsh.

In total, Cheeye’s imprisonment term is 28 years, but the High Court ordered that he serves them concurrently, for just 10 years.

The appeal judges said Cheeye was given chance to defend himself, but he declined to talk.

The anti-corruption court has convicted four people over the Global Fund. Former director of programmes in Uganda Television Salongo Scoff Kavuma got five years and is to refund sh41m he embezzled. Annaliza Mondon and Elizabeth Ngororano also earned five years imprisonment and are to refund sh30m of the sh38m they received through their NGO, Value Health.

Uganda 's good Governance Record improves.

Sylvia Nankya;

UGANDA is the third best performer in good governance in eastern Africa, according to the Mo Ibrahim Index report released on Monday.

Uganda scored 51% for governance quality in 2009 and was ranked 24th out of 53 countries. The regional averages for East Africa stood at 45% (2010) and 46.9% (2009).

Out of the 12 eastern Africa countries, Uganda emerged third just behind Seychelles (74.5%) and Tanzania (54.1%). Djibouti scored 50.1%, Kenya 49.7%, Comoros 48.3%, Rwanda 47.9%, Burundi 45.8%, Ethiopia 44.2%, Sudan 33.4% and Somalia got the least rank in Africa with 7.9%.

The 2010 Ibrahim Index shows both areas of progress and setbacks in governance between 2004/05 and 2008/09 (the most recent period assessed).

It shows that Uganda performed poorly in national security and highest in the rule of law. The survey is designed to encourage good governance.

The index was launched simultaneously with events in the cities of Accra, Dakar, Johannesburg and Nairobi. It measures the delivery of public goods and services to citizens by governments and non-state actors across 88 indicators.
Eritrea got 33%, Zimbabwe 32%, DR Congo 32% and Chad 31%.
Of the 53 countries surveyed, 41 have seen improvement over the past five years in the area of sustainable economic opportunity, the foundation said.

But the gains have been offset by declines in 35 countries in the area of safety and the rule of law, and almost two-thirds of countries declined in the areas of participation and human rights.
Seychelles was the best performing country in the eastern Africa region in all four categories of the index, while Somalia was the worst.

East Africa performed poorly as a region, ranking fourth out of the five regions in Africa in safety and rule of law and sustainable economic opportunity as well. It was third in human rights and human development, but performed poorly in national security and public management.

“The index gives us a mixed picture about recent progress on governance across the continent. While many African citizens are becoming healthier and have greater access to economic opportunities than five years ago, many of them are less physically secure and less politically enfranchised,” stated Mo Ibrahim, the founder and chairman of the foundation.

He is also the creator of the Mo Ibrahim Prize for Achievement in African Leadership, the world’s largest annual prize, created to reward former African leaders for good governance.

Winners get a $5m prize split over 10 years, plus $200,000 annually for the rest of their lives and $200,000 a year for charitable causes of their choice.

For the past two years, there have not been any prize winners. The last winner was former Mozambique president Joachim Chissano.

The index seeks to inform and empower the continent’s citizens and to support governments, parliaments and civil society to assess progress.

Salim Ahmed Salim, a board member of the foundation and former secretary-general of the Organisation of African Unity, said: “We must ensure that the political side of governance in Africa is not neglected.

“We have seen from evidence and experience across the world that discrepancies between political governance and economic management are unsustainable in the long term.

If Africa is going to continue to make progress, we need to pay attention to the rights and safety of citizens.”