By Moses Kaketo
Six months since the death of Prof. Emmanuel Tumusiime Mutebile, the president is yet to appoint a new Governor of the Bank of Uganda (BoU).
Mutebile died on January 23rd January 2022 at a hospital in Nairobi, Kenya.
According to reports, the highest office was ‘under pressure’ from some groups, including the Bakiga, the Baganda, the Catholics, the Protestants, and the Muslims, to appoint their preferred candidate as the next Central Bank Governor.
The appointing authority apparently chose to keep quiet for now since Dr. Michael Atingi-Ego, the Deputy Governor, is doing a noble job, and with him playing an oversight role. The hunt for the right candidate goes on.
According to a source in a position of knowledge, the president could be planning an overhaul at Plot 37/45 Kampala Road before the end of this year.
“I think the president is planning to carry out an overhaul at the BoU. The term of the board is expiring November 2022. Conceivably, he is planning to appoint a new board, and the governor at the same time, “said a well-informed source who works at the command center of the Uganda shillings.
BoU board-lacking a quorum?
President Museveni reappointed Dr. William Kalema, Mr. James Kahoza, and Ms Jude Obitre Gama to the Bank of Uganda’s Board of Directors in November 2017.
Ms. Josephine Okui Ossiya replaced Mr. Ibrahim Kabanda (RIP). The other members of the board include the governor and his deputy.
Article 161 of the Constitution provides that the authority of the Bank of Uganda shall vest in a board. It is composed of 07 directors: the governor who is the chairman of the board, the deputy governor who is the deputy chairman and five other non-executive directors. Hitherto, the Permanent Secretary and Secretary to the Treasury, (PSST) was automatically among the ‘’ not more five other members.’’
Nevertheless, under the new law, the PSST is no longer a board member. Consequently, without a governor, that leaves only five members.
That is not all. Read on.
According to corporate governance experts, For Board Meetings, the minimum number of members required is 1/3rd of the total number of directors
Dr. William S. Kalema, 70, is said to be having health issues. First appointed in 2012 and reappointed in 2017, Dr. Kalema, who is also the chairperson of the capital projects committee ad financial stability committee is said to be moving in a wheelchair. The financial stability committee among others provides oversight of supervision and regulation of the financial sector.
He also sits on four other committees of the board.
Reports indicate Mr. James Kahoza, 73, is also not well. Kahoza, who is the chairperson of the audit and governance committee, also sits on four other committees.
Interviewed for this story, a corporate governance analysts says, the lack of quorum technically means ‘slow decision making. And this has a huge impact’’
He adds: that means the directors are not decisive’’
In June 2020, President Museveni sacked Judy Obitre-Gama as the National Identification and Registration Authority (NIRA) Executive Director over alleged incompetence and corruption by the authority.
Ms. Judy Obitre is also the chairperson of the strategy and finance committee and board of trustees of BoU. She sits on four other committees.
Interviewed for this story, a corporate governance expert had this to say: ‘‘if you’re fired from one government institution for incompetence, are you still qualified to be a member of another government institution?’’
“If the president says you’re incompetent, you’re ideally incompetent across the board. I feel she should have resigned from BoU board long ago,” he added.
Obitre-Gama, a lawyer by profession, was appointed NIRA boss in July, 2015. In April 2018, she was investigated for abuse of office, fraud, and corruption and placed under the criminal investigation department.
Trouble started when the Auditor General raised queries over funds spent on the registration exercise for children in schools. NIRA had reportedly failed to ac account for huge sums of money, channeled billions of money to individual accounts and flouted procurement procedures during the exercise that was carried out in secondary schools across the country during the national ID student enrolment exercise.
It was reported that NIRA sent UGX 2.1 billion to individual accounts, while UGX 1.3 billion was wired to the chief accountant’s personal bank account.
Twice, in cabinet meetings, in June 2019 & in February 2020, NIRA was a key subject after ministers claimed they had received reports of frustration by Ugandans in the process of getting their National IDs.
Interviewed for this story, a source at Bank of Uganda said, the appointing authority is aware of all ad will act the right time.
Last year: the board met 17 times. While the committees on average met six times. Non-executive directors are paid UGX. 5m as monthly retainer and UGX. 2.5m as sitting allowance.
Bank of Uganda Director of Communications, Charity Mugumya did not respond to our emails when we reached out to her for a comment.
The Role of the Board
According to the Constitution of the Republic of Uganda, 1995, and the Bank of Uganda Act [Chapter 51, Laws of Uganda], the Board of Directors, among others: Provide entrepreneurial leadership for the bank within a framework of prudent and effective risk management, provides direction for management and create a high-performance culture.
It also oversees the integrity of the Bank’s accounting and financial reporting systems; and the effectiveness and adequacy of the risk management and internal control systems. They also ensure annually that the bank will survive, thrive, and continue as a viable going concern.
Meanwhile, the bank of all banks In Uganda is yet to publish the results of board performance report for the FY 2020/21.
The Deputy Governor shines
Amidst all these challenges, Dr. Michael Atingi-Ego, the Deputy Governor/Deputy Board Chairman, is doing ‘’a fantastic job,” says a financial expert with knowledge of the operations of the central bank.
“He has managed to play very well the fundamentals of the economy,’’ he said.
The central Bank’s primary role is to ensure price and economic stability.
also read: Poison, witchcraft scare at Bank of Uganda
About the author: The writer is a marketing and distribution expert. He sees business in everything. He loves writing business news, reviews, and analyses.
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