Parliament of Uganda Hansard - First Session, Third Meeting - 18 April 2007

Wednesday, 18 April 2007

Parliament met at 3.15 p.m. in Parliament House, Kampala.

PRAYERS

(The Deputy Speaker, Ms Rebecca Kadaga, in the Chair.)

The House was called to Order.

COMMUNICATION FROM THE CHAIR

THE DEPUTY SPEAKER: Honourable members, I welcome you to today’s sitting. Yesterday we informed you that hon. Dr Bulamu died. I want to inform you that the burial has now been set for Saturday at 1.00 p.m. at Bulike, Kiyunga in Luwuka, Iganga District. Please remember Saturday, honourable members, for those who will be able to go.

Secondly, I would like to inform you that Mrs Rebecca Oyite Ojok has also died. We will inform you tomorrow about the burial arrangements.

I would like to alter the Order Paper to permit the laying of two other papers by the Minister of Finance and also to bring forward completion of the Penal Code (Amendment) Bill 2004.

PRESENTATION OF PAPERS

3.16

THE MINISTER OF STATE FOR FINANCE, PLANNING (Mr Omwony Ojwok): I thank you, Madam Speaker. Honourable members, in accordance with Article 159 of the Constitution of the Republic of Uganda, I beg to lay on Table requests for authorisation for Government to:

1. Secure funds from the International Development Association of the World Bank for purposes of financing the Power Sector Development Programme to the tune of US $30 million.

2. Provide a partial risk guarantee for Bujagali Private Power Generation Project of up to US $115 million to be financed by the International Development Association.

3. Borrow US $30 million from the Export and Import Bank of China for financing the National Data Transmission Backbone Infrastructure Project.

Madam Speaker, I beg to lay. There are additional Papers to be laid on the Table. I request, with your permission, that these are laid by my colleague, hon. Rukia Chekamondo

3.18

THE MINISTER OF STATE OF FINANCE, PRIVATISATION (Ms Rukia Chekamondo): In addition, Madam Speaker, I beg to table a request to secure finances from the International Development Association of the World Bank for the purposes of financing the railway partial risk guarantee of up to US $15 million. This matter was discussed under the East African trade and transport facilitation credit, which was approved by this House but deferred so that it is presented on merit. I beg to lay.

Finally, in accordance with the PERD Act, Cap.98, the Minister of Finance is required to submit a semi-annual report to the Legislature on the implementation of its various provisions. I beg to lay on the Table of this Parliament the consolidated statutory reports from the Privatisation and Utility Sector Reform Project for the financial years 2004-2006. I beg to lay.

MR NANDALA-MAFABI: Madam Speaker, they say semi-annual but now they are laying from 2004 to 2006. Are those still semi-annual or many annuals?

THE DEPUTY SPEAKER: We shall establish that when we are in the committee. The statutory reports are hereby committed to the Committee on Finance, Planning and Economic Development while the others are committed to the Committee on National Economy.

BILLS

SECOND READING

THE PENAL CODE (AMENDMENT) BILL 2006

(Debate continued)

MR NANDALA-MAFABI: Madam Speaker, I think the Order Paper clearly says “Ministerial Statement by the Minister of Finance”.

THE DEPUTY SPEAKER: You arrived late.

3.20

THE MINISTER OF STATE, JUSTICE AND CONSTITUTIONAL AFFAIRS (Mr Freddie Ruhindi): Madam Speaker, at the closure of the debate on the Penal Code (Amendment) Bill some queries, comments and observations were made by my colleagues, some of which demand responses. In the interest of time, I have tried to put my responses in writing. Colleagues will bear with me, as I will try as much as possible to keep on referring to my notes, to keep on refreshing my mind by reading them.

Hon. Safia Nalule sought to expand the coverage of the offence of aggravated defilement under sub-clause (4) of clause 2 to include “where the victim of the offence is a person with disability”. After necessary consultations on the importance of this proposal, an amendment will be moved to that effect at committee stage.

Within the consultations, there was concern about the extent of disability for purposes of the offence. This is addressed by the standard definition for disability under the Persons with Disability Act, Act No.20 of 2006, which is proposed for re-enactment in the Bill in order to avoid referential legislation.

Hon. Rose Namayanja raised concern on the high burden of proof in sub-clause (4) (b) of clause 2 with the use of the expression “where the offender to his or her knowledge”. After necessary consultation, an appropriate amendment will be moved at committee stage. Most of her other concerns will be dealt with under the Sexual Offences Bill.

She raised an important issue of cultures and religions that allow marriages of persons below 18 years. Article 31 of the Constitution provides the age of 18 and above as the age of marriage. Article 37 of the Constitution provides that every person has a right as applicable, to belong to and enjoy any culture or religion. Therefore, any culture or religion that is in conflict with Article 31 is not a right as applicable under Article 37 and is accordingly prohibited.

The honourable member wanted to know why there were no proposed amendments to the following sections: section 130 of the Penal Code on defilement of idiots and imbeciles; section 131 on postulation for defilement; section 132 on defilement of women by threats, and so on. Section 133 is on a householder permitting defilement of a girl under the age of 18.

The main purpose of this Bill is to transfer jurisdiction of defilement cases from the High Court to chief magistrates’ courts, in order to decongest the prisons and courts and expedite the hearing of such cases. As you may note, the offences in sections 130 to 133 are all currently triable by the lower courts, or magistrate’s courts, and there was therefore no immediate need for amendments to those provisions in that regard. Amendments to the above sections are therefore proposed in the Sexual Offences Miscellaneous (Amendment) Bill, which is before Cabinet for approval of principles for drafting of the Bill. It will soon be introduced in Parliament for debate.

Hon. Winfred Masiko was very supportive of the Bill. Her major concern on the burden of proof has already been addressed. The member wondered whether offences on attempts to commit the offence of defilement were covered under the Bill. The answer is yes, under sub clause (2) of clause 2. Colleagues may also wish to study Chapter 40 of the Penal Code, which spells out the general provisions of offences on attempts.

Her proposal of a state fund for the victims of the offence of defilement is not sustainable. Every criminal sanction should be aimed at deterrence and corrective measures. To the contrary, a state fund would be counter-productive and promote the opposite. This is, however, without prejudice to any measures that the state may take to ensure that the victims are treated, given some contribution towards their welfare, etcetera.

Hon. Alice Alaso, like hon. Winfred Masiko, advocated for state arrangements to look after victims of defilement and rape. As much as some of her submissions will be dealt with under the Sexual Offences Bill, I have already covered this matter.

Her concern about rape of old women and her proposal create another provision of aggravated rape, which may be considered under the Sexual Offences Bill. She may wish to note, however, that section 124 of the Penal Code provides that a person convicted of rape is liable to suffer death. This means that a judge has discretion depending on the gravity of the case, say where a very old woman is raped, to impose maximum sentence.

Hon. Denis Obua was concerned that suspects stay on remand for long periods without trial. This Bill when passed partly addresses that problem through the empowerment of chief magistrates to hear and determine defilement cases.

He pointed out problems of administration of justice, particularly in Gulu. The issues of increase of judges will be dealt with in detail in the Judicature (Amendment) Bill. Suffice it to say that the Ministry of Justice and Constitutional Affairs launched its Gulu regional office on 30 March 2007. A resident judge has already been deployed in the area and another one is there to help on the backlog of cases. Five state attorneys have also been deployed at the regional office.

The Chief Justice has already submitted the draft instrument for the Ministry of Justice and Constitutional Affairs to increase the number of magisterial areas so that ten more positions of chief magistrates are created and filled. The instrument is before the Ministry of Finance, Planning and Economic Development for a certificate of financial implications.

Hon. Odonga Otto Junior was concerned with clause 2(4)(b) including a circumstance of the punishment of an offender who performs a sexual act with another person below the age of 18 when he or she has reason to believe that he or she is infected with HIV. He was concern that it offends Article 21(2) of the Constitution that provides for equality and freedom from discrimination. I believe that by now, and after my interaction with him, hon. Otto agrees with me that his submission is not sustainable nor do the provisions of Clause 2(4) (b) of the Bill offend Article 126 of the Constitution on exercise of judicial power as stated by him.

Hon. Mariam Nalubega wants defilement cases tried in camera. This is adequately catered for in the coming Magistrates Courts (Amendment) Bill. She agrees with the Legal and Parliamentary Affairs Committee to delete clause 6(b). After necessary consultations, I agree with the position of the Legal and Parliamentary Affairs Committee on the deletion of clause 6(b).

Hon. Rebecca Amuge wants the compensation clause deleted. I have already discussed this. She is concerned about the inadequacy of remand homes. Every effort is being made, particularly under the Justice Law and Order Sector, to improve facilities at the remand homes. Negligent parents and guardians should be handled under the Children’s Act.

Hon. Crispus Kiyonga proposes deletion of the expression “Acquired Immune Deficiency Syndrome” and maintenance of “Human Immune Deficiency Virus” in order to liken the provision to the stage where the person is most likely to infect others. He further proposes that an offender be subjected to an HIV test to determine his or her status. After necessary consultations, appropriate amendments will be moved at committee stage.

Treatment of victims of the offence is a welcome idea but may not be provided for in the law. The proposal that in addition to HIV other sexually transmitted diseases be brought under clause 2(4) is not commensurate with the gravity of the offence being addressed, particularly given the fact that these other diseases may be treated and cured.

Hon. Tarsis Kabwegyere’s contribution on the presence of councillors is welcome but may not be included in the law.

Hon. Milton Muwuma is very supportive of the including “boy” and “girl” in the Bill.

Hon. Kubeketerya may have to rethink his submission on the good attributes of corporal punishment, in view of the requirements of Article 24 of the Constitution. However, he had an excellent contribution on the need for an updated national register that would help in the determination of age of a defiled victim. His worry about the applicable law on child sacrifice is addressed by Chapter 20 of the Penal Code on murder, among others.

Hon. Christopher Kibanzanga’s submissions on abortion will be addressed under a different Bill. His concern about alleged corporal punishment in the armed forces can best be addressed to the relevant minister for an appropriate answer.

Hon. Johnson Toskin, although an amendment will be moved at committee stage to improve the definition of “sexual act”, his proposal to justify genital mutilation within its context is not sustainable in view of articles 24 and 37 of the Constitution. Our friends in hon. Bartille’s domain may wish to borrow a leaf from our friends elsewhere who may use objects or other means to do exactly the opposite of genital mutilation, to add value and still remain within the ambit of the law.

Once again, I thank you all for the support you have given this Bill and for your very important contributions. I thank the Legal and Parliamentary Affairs Committee for the excellent report. Thank you very much.

3.34

THE DEPUTY CHAIRPERSON, SESSIONAL COMMITTEE ON LEGAL AND PARLIAMENTARY AFFAIRS (Mr Peter Nyombi): Madam Speaker, we have been in close consultation with the Attorney General and we are virtually in agreement with all the comments he has made in response. We really have nothing to add. (Applause)

MS ALICE ALASO: Thank you very much, Madam Speaker. I seek your guidance. I do not know whether it comes in at this stage or after we have disposed of the Bill. I am concerned about the recent constitutional court ruling on the declarations of some parts of the Penal Code especially in regard to adultery, the fine of Shs 600, the discriminatory nature of that law and such related matters. As things stand, I believe that there is no provision in the Penal Code that will govern matters of adultery in our social setting. I am wondering whether it is the right time to ask the Minister to advise us since we are dealing with the Penal Code. What is going to happen? When is he coming with an amendment?

In the meantime, I read in the newspapers that people are cutting off limbs. Yesterday somebody was murdered. This was in the media. The other day, somebody’s limb was cut off. So, is it not about time that the honourable Attorney General helps us out to save this situation?

MR RUHINDI: Madam Speaker, I am sorry about that hiccup. The House is very full this end. (Laughter)

On the issue of adultery and the constitutional ruling, my ministry will soon come up with a Cabinet paper explaining the import and gist of the constitutional court ruling, and it will eventually come here. However, colleagues may wish to note that Cabinet had actually taken a position on the issue of adultery as an amendment to the existing provision in the Penal Code, and that provision is in the DRB. That position is not the law, but I wanted to bring it to your attention because you may wonder if this matter has ever been addressed. Yes, it has. The Bill is printed - (Interjections)- yes, the Domestic Relations Bill.

However, we all know the problems the Domestic Relations Bill has been going through. Stakeholders have been consulted. There are certain positions, which are being agreed on as a way forward. You all remember when the DRB was being debated here there was a demonstration in town. One wondered whether we should continue to sit here and pass a law when some people were on the streets demonstrating. So, that called for a different strategy and approach, which we shall actually inform you about later.

If you want to know the thinking of Government or Cabinet, because Cabinet had already approved that issue of a revised provision on adultery, look at the provision in the DRB for the time being.

MS ALASO: Madam Speaker, I am actually more confused now than when I started. I know that if there is an incoming law in this country which has had the roughest time, it is the DRB. It has had the most hazardous formulation process. I thought that since some of these provisions – (Interruption)

MRS MWESIGYE: Thank you, Madam Speaker. I thought this House was going to committee stage bearing in mind business before it, but from what I am hearing now, we are opening debate on different issues. I would pray that we concentrate on the business before us and that other business will be tackled at an appropriate time.

MS SSENTONGO: I just want to find out from the Attorney General whether it would be possible to include a provision for female police surgeons. Currently, we only have male surgeons.

Secondly, I also want to find out whether the issue of taking the victims of defilement to court could also be dealt with here or in any other law. I think it would be more appropriate to have a kind of barrier like is happening in other developed countries. These defiled victims sometimes tend to fear to lock eyes with the people who committed the offence on them. I think it would be appropriate to provide something to shield the eyes of the victims. I just want to find out if it is possible to put this in the Penal Code.

THE DEPUTY SPEAKER: I put the question that Bill entitled, “The Penal Code (Amendment) Bill, 2006” be read for a second time.

(Question put and agreed to.)

BILLS

COMMITTEE STAGE

THE PENAL CODE (AMENDMENT) BILL, 2006

Clause 1 agreed to

Clause 2

MR NYOMBI: Madam Chairperson, we propose that Section 129(4) be amended by deleting sub-clause (a). The justification is that it is sufficient that the victim is below the age of 18 and it is therefore unnecessary to categorise the children on the basis of age. The judge can exercise discretional powers to give sentences basing on the circumstances of the case.

MS WINIFRED MASIKO: Thank you very much, Madam Chairperson. I would like some clarification. Clause 2 has several parts and I think the chair just mentioned clause 4 (a). There has been an amendment of (b) also.

MR RUHINDI: Paragraph (b) of sub-clause (4) section 129 is recast as follows: “where the offender has reason to believe that he or she is infected with Human Immune Deficiency Virus”. The justification is, to limit the requirement of HIV test to the stage where a person can technically infect another person with HIV. Also, we want to lessen the burden of proof by the use of the expression, “who has reason to believe” from “to his or her knowledge”.

THE DEPUTY CHAIRPERSON: So, how will it read in full?

MR RUHINDI: It would read, “Where the offender has reason to believe that he or she is infected with Human Immune Deficiency Virus”

MS WINIFRED MASIKO: Madam Chair, I would like to find out if my version could be adopted by the Minister. I do appreciate the amendment, but I thought we could say, “Where there is reason to believe that the offender is infected with AIDS” rather than saying, “…has reason to believe that the offender is infected”.

MR NYOMBI: Madam Chairperson, if that amendment were to be taken, it would shift criminal liability to somebody else. The amendment proposed by the Attorney General places the liability entirely on the offender.

MS WINIFRED MASIKO: Right from the beginning we had, “where the offender, to his or her knowledge,” but we thought it was not enough because of the burden of proof. We were in agreement with what the Minister said, that there is reason to believe. So I would like to be guided.

I think this one strengthens the suggestion we had right from the beginning, if we put it there and maybe add to the original one. My worry is, this means it is the offender and yet I think the import of this amendment was for somebody else. After a person has been defiled, he will come and say he might have done it without his knowledge but he still has HIV/AIDS according to what has been happening around him. So, I think that is what we thought this was trying to cure. I still need a bit more clarification on that.

MS ALASO: The amendment proposed by the chairman is the deletion of sub-section 4 (a), which says “where the person against whom the offence is committed is below the age of – (Interruption)

THE DEPUTY CHAIRPERSON: No. We have not yet voted.

MS ALASO: We did not vote. We did not pronounce ourselves, I thought.

THE DEPUTY CHAIRPERSON: We are not yet on 4.

MS ALASO: Sorry, Madam Chairperson, it is sub-section 4 (a) of 129. That is exactly where we are. Actually, you are probably ahead because you are on (b) and I am on (a) on page 2.

THE DEPUTY CHAIRPERSON: We dealt with (a). We finished with (a). We are on clause 2.

MS ALASO: No. Madam Chairperson, we did not pronounce ourselves on –(Interruption)

THE DEPUTY CHAIRPERSON: I was going to put the question and then you started coming up with interjections.

MS ALASO: Yes, and I also need some clarification, Madam Chair. I thought the original draft, which provided for categorisation in (a) (b) (c) and (d), looked at age as a factor in an aggravated defilement situation. Therefore, my understanding is that the original position, including sub-section (a) where the person is below 14 years, would still be maintained. This is because I believe the consequences of defilement get graver as the age of the defiled person reduces. If somebody is defiled at the age of three, it is worse or five, ten; it is worse. As such, this would then guide the judge or whoever will be listening to this case, just like the provision in sub-section (b) where the person has reason to believe that he or she is infected with HIV.

My argument, Madam Chairperson, is that we retain (a) because it goes ahead, just like the other provisions in that same section, to provide for categorisation. I still believe that it is because the younger the person, the more grave the effects of defilement.

MR LUKWAGO: Madam Chairperson, on the proposed amendment concerning the categorisation in terms of age, I thought it is not in relation to sentencing but rather to the elements of the crime. The gist of the categorisation as mild defilement and aggravated defilement is the key element, actually. That is what I thought. I do not know why it is being considered as a mitigating factor or a matter to be considered at the stage of sentencing and not at the stage of establishing the gravity of the offence.

MR RUHINDI: Correct me, Madam Chair, but I thought that the shadow Attorney General is a member of the Legal and Parliamentary Affairs Committee that has moved this amendment. I do not know whether he is actually moving a minority position.

THE DEPUTY CHAIRPERSON: If he is a member of the committee then he is part of it, unless he has diverted from it.

MR NYOMBI: This is the report of the committee, and we have never received a dissenting opinion from the shadow minister. I am sure he is fully aware we omitted paragraph (a) and left paragraph (b) because when the child is defiled, it is not only the defilement but it is like somebody is injecting the child with poison that would lead to death. Those were some of the arguments that were raised during the discussion and so we omitted paragraph (a).

DR EPETAIT: Thank you very much, Madam Chairperson. I still want to contend that it is our duty to ensure that children in our country are given maximum protection. By amending 129 4(a) to give discretionary powers to the judge to determine the sentence, as the committee has proposed, I think we will not have come out to protect the children very seriously. When we categorise the gravity of the offence, the offender can even stand warned before he contemplates his acts. So, I would prefer that we categorise this offence and maintain the age limit.

If somebody has gone ahead to defile a child of six years, I think that person should not be treated with the same gloves as somebody who has defiled a girl of 17 years. I think let us maintain the proposal as in the Bill itself and give the maximum sentence; after all, that is why we call it aggravated defilement. Give the maximum sentence to those who defile even the youngest. I beg to differ with the committee and I really plead that the chairperson concedes and we go according to the original proposal in the Bill. Thank you.

MR NYOMBI: Madam Chair, the whole of this section covers children. In certain sections, however, new elements are brought in, for example in paragraph (b). Not only is the child defiled, but the child is defiled by somebody and the child is likely to suffer with a disease that may lead to death. That is the reason why we removed paragraph (a).

DR BARYOMUNSI: Thank you, Madam Chairperson and honourable members. I want to disagree with the committee and also support my colleague that we should maintain the age at 14. I am sure there was some insight from the ministry when the age was proposed. In the field of medicine, we take the age of children to be up to 12 years. In the field of population and development, we use 14 years, especially when we are calculating those who can be employed and those who cannot. In the Constitution, we take 18 years. So, there is a reason why 14 came up.

Also, when you look at vulnerability to some diseases like HIV, it is higher when the child is younger. In other words, a young girl of 14 years is more likely to acquire HIV than say one of 17 years or 19 years when the offender is infected. So, I think we should strengthen the law and remain very clear on this age categorisation, so that when you get a defiler going with a young girl of 9 or 10 years the punishment should be more severe. My proposal is that we agree to maintain the original framing of the law so that 14 years is maintained as part of the aggravated defilement.

THE DEPUTY CHAIRPERSON: Chairman, I do not know whether you have evaluated the decisions taken in rape or defilement cases. Even that man who defiled a child of three months did not get the death sentence because of the discretion. I think he got a few years. Do you not think we should really focus on aggravated defilement?

MR NYOMBI: Madam Chair, we did consider all those circumstances. In fact, all those cases were quoted. We also received submissions from lobby groups, particularly women lobby groups. They were against the categorisation of this 14 or 18 years.

THE DEPUTY CHAIRPERSON: Honourable members, let me put the question that clause 2 be amended as proposed by the chairperson.

(Question put.)

THE DEPUTY CHAIRPERSON: Members, I think I was unable to determine whether the “ayes” or “noes” had it.

MR NYOMBI: Madam Chairperson, I think I wish to concede. (Applause)

THE DEPUTY CHAIRPERSON: Any further amendments to clause 2?

MR RUHINDI: Madam Chair, I propose that an amendment be inserted immediately after paragraph (c) to read, “(cc) where the victim of the offence is a person with a disability.” The justification is straightforward. It is to expand the application of the offence to persons with disabilities as defined in the Persons With Disabilities Act, 2006. The definition of a person with disability, imported from the same Act, will be proposed for inclusion at a later stage.

THE DEPUTY CHAIRPERSON: I propose the question that clause 2 be amended as proposed by the Minister.

(Question put and agreed to.)

MR RUHINDI: Madam Chair, I propose the inclusion of a new sub-clause (5)(a) immediately after sub-clause (5) to read, “Where a person is charged with the offence under this section, the court may direct that the person shall undergo a medical examination as to his or Human Immunodeficiency Virus status.” The justification is that the new provision is to assist in the prosecution of an offence under section 129 where the HIV status of the accused is in doubt.

THE DEPUTY CHAIRPERSON: Honourable minister, I do not know whether we are reading the same document. Was that still under clause 2?

MR RUHINDI: On top of page 2 of the amendments, where it says “Clause 2, page 2, immediately after sub-clause (5) insert the following new sub-clause”. Have you seen it Madam?

THE DEPUTY CHAIRPERSON: Yes I have. Thank you.

MS BOONA: Thank you very much. I would like to comment on the clause he has just read - “Where a person is charged with the offence under this section, the court may direct…” I am very jittery about the word “may”. I propose that we say “the court shall”, so that we always have the HIV status determined. This is because by looking at a person, there is no way you will know whether he is positive or not. That is my proposal.

MR RUHINDI: We use the expression “may” where there is doubt. Where there is no doubt and there is sufficient evidence before the court, there may be no need for further check-up. There may be proof from a medical practitioner or there may be proof from so many circumstances. This is why we use “may” instead of “shall.”

THE DEPUTY CHAIRPERSON: But honourable minister, how will you know by looking at somebody in the dock that this person has AIDS?

MR RUHINDI: When the person is in the dock, he or she is being prosecuted and the prosecution brings evidence against that person. There may be evidence, for instance from his or her doctors, and it may not even be disputed.

MR KIBANZANGA: I think the Minister is trying to romance with the rapists. We proposed here that part of the arrest should include taking you to the clinic and testing your HIV status, which should then be exposed to the whole world before you even go to court. It should be part of the arresting activity. They should not wait for you to go to the dock. In this country there is a lot of forgery. Immediately someone is arrested on defilement, he will call relatives and the relatives will go and forge. The burden of proof should not be with you. Immediately it is known that you have raped, your HIV status should be known by the whole world.

MS WINIFRED MASIKO: Madam Chair, I also need some more clarification, especially since we have already said that we shall amend sub-section (4) (b) to read “has reason to believe”. Maybe if it had stayed in its original state, it would be different. Now we have said “has reason to believe” and if we put “may” instead of “shall”, I think we are risking and we are not making it watertight. Since we have already said “has reason to believe”, we should make it mandatory for somebody to be tested.

MR LUKWAGO: Mine is a rejoinder to what hon. Masiko has said, but it is slightly different. We have just passed sub-clause (4) and the elements of aggravated defilement are very clear. One of them is the offender being infected with HIV. So, this matter of court directing that you be subjected to a test is subsequent to the act of charging you. As such, the charge sheet should be structured in such a way that you, being infected with HIV, went ahead and defiled so and so. This is at the stage of making the charge sheet. So, it cannot be directed by court and it cannot come subsequent to charging. It should be at that level of making a charge. This is my understanding of the whole thing. I thank you, Madam Chairperson.

MR NYOMBI: Madam Chairperson, if this proposed amendment is passed and the examination by a doctor is made mandatory shortly after an arrest is effected, the already known doctrine that a person is known to be innocent until proved guilty will be shifted. That is why it was framed this way; a person goes to court and then it is court to direct the examination. However, if the examination is done immediately after the arrest, it means that the person has already been condemned.

Secondly, assuming that the victim is 17, 16 or 15 years, how will one tell who infected the other? There is a possibility that the victim herself or himself is already infected.

MR TUMWESIGYE: Madam Chairperson, thank you. Looking at this particular sub-section, for us to add “shall” means that we might need to revisit sub-clause (b) that we have just passed. I believe that if we revisited the other clause and said “Where the offender is infected with HIV” without putting the words “has reason to believe”, it would mean that every person to be charged shall also be tested for HIV.

If we leave it as we have passed now, it will hamper our efforts to do counselling and testing. It will also mean that people will hesitate to go for HIV testing or come out openly and say, “I have HIV” because of that fear. If we said “where the offender is infected with HIV, with or without her knowledge” and then every time the person commits defilement that person is subjected to a test, we will say “shall”.

Right now we have only about 11 percent of women in Uganda and about 13 percent of men. When you say “has reason to believe”, people will go underground. They will not come out for testing. However, if we say “with or without his or her knowledge”, then it will be up to the court to say that by the time this person committed this offence, he or she was infected and so shall suffer the penalty as specified. I do not know what we will do, but we need to revisit the other clause in order to cater for this one, otherwise we shall have a law that will be difficult to implement.

MS ALASO: Madam Chairperson, I understand that the process of handling defilement cases involves a mandatory examination by a doctor. If that mandatory provision is already there, what is difficult in making this one also mandatory? I do not buy the argument of the chairperson of the committee that if the child was infected and was the one who has infected the defiler. These children do not consent.

Remember we are making a law to safeguard children who, by virtue of their age, do not consent to sex. They are not adults. So, if you who go messing around with children, you should pay the price for being reckless and irresponsible. (Applause) I would like to see this provision reflected as “shall” not “may”, to make it mandatory for an examination to be carried out for these defilers.

THE DEPUTY CHAIRPERSON: Is the chairman still insisting on that position?

MR TANNA: Madam Chairperson, like the previous speaker just said, I think we are here to make a good law. If we leave the law porous, it shall be exploited in the future. Secondly, the element where one has to come out voluntarily concerning his or her status is again porous. I think the law is being made so that whoever is infected and is aware of this, and with the premeditation goes ahead to defile with the intention to spread, then the act becomes punitive. Therefore, it is imperative that a mandatory test be taken. If somebody does it unwillingly, then that law would not even apply as he did not know his status before. We are only saying that it is imperative that the test be taken.

THE DEPUTY CHAIRPERSON: Let me put it another way. In case of rape and defilement, the woman is required by law to prove penetration. If the woman has no record of those tests, she cannot prove the case. But you are saying it is okay for the man not to be tested. What you are saying is discriminatory.

Honourable members, we have very important guests in the distinguished Strangers’ Gallery. They are Members of the House of Representatives of Somaliland. They are led by their Speaker and the Second Deputy Speaker. You are welcome. (Applause)

MS SENINDE: I thank you, Madam Chairperson. I am only seeking clarification. We are aware that when somebody’s status is still in the window period it will definitely test negative. Assuming this offender is tested and found negative because he is still in the window period, should we not put a provision that requires the offender to be tested more than once?

MAJ. RWAMIRAMA: Thank you, Madam Chairperson. I tend to agree with hon. Kibanzanga. I think we are glorifying a criminal act. Whether you have HIV or not, it should be presumed that you are putting somebody at risk. The burden of proof that you are not sick is yours; otherwise, the victim should be protected.

MR ODONGA OTTO: I am just making a rejoinder. Concerning this particular amendment by the chairman of the committee, I think this is not the position we had taken in the committee. I do not think the committee can bring an amendment that will shift the burden of proof. To me, that is its implication. In any criminal offence the burden of proof is with the prosecution, to prove all the ingredients of the case. I do not see how we can start shifting the burden from the prosecution to the court. I think the position that the Attorney General is representing was not of our committee.

MR NYOMBI: I think I said exactly what he is saying. A person is presumed innocent until proven guilty. If the test is forced on the suspect prior to going to court, it is likely to be abused. Secondly, it would mean shifting the burden of proof on to the offender.

MR ODONGA OTTO: What was discussed in the committee was that if the burden of testing for AIDS is left to the Police, it will not in any way make the suspect guilty. It is like asking for your name, age, asking you to remove your shoes and sleep at Police cells. That is all done even when you are presumed to be innocent. So, what would be wrong with bringing a provision for HIV status, just like they ask for your age, tribe, or that you remove your shoes and belt? Those are all done even when you are still innocent, before you have been proven guilty.

DR BARYOMUNSI: Madam Chair, to the best of my knowledge, whenever a suspect is arrested, especially in some of these capital offences, he or she is required to be subjected to some examination under Police Form 24 for their demeanour. So, it is at this time that this examination should be conducted. So, it should be mandatory. Thank you.

THE DEPUTY CHAIRPERSON: Members, let us resolve this matter.

MR REMIGIO ACHIA: Madam Chair, thank you very much. We all agree that we have defined the elements of aggravated defilement. We all agree that the offenders need to be tested. However, I want to disagree on one thing, the timing of the test. I want to agree with the chairperson of the committee that the test to prove whether you have HIV or not should not come before the matter goes to court. It is not like in the case of rape, where you have to prove the elements like a scratch, forced penetration and other things there and then. If you have HIV and you are tested after the mandatory one year of remand to prison, it will still be established that you had it before. Thank you.

MR LUKWAGO: The information I want to give to my colleague there is that we are talking about aggravated defilement. We are not talking about general cases of defilement. This other aspect of defilement, which is okay –(Laughter)- Madam Chair, I do not know why – (Interruption)

MS BOONA: Thank you, Madam Chairperson. We have just heard from the learned lawyer, and an informed Member of Parliament, that there are types of rape and defilement that are normal and accepted. From what he has said, he is implying that there is rape that is not serious and not aggravated. Is the honourable member in order to imply that some rape is very acceptable and therefore not serious, and we can discuss that in this august assembly? Is he in order?

THE DEPUTY CHAIRPERSON: Honourable members, rape is a criminal offence. It cannot be okay. You are out of order. Withdraw that part that said it is okay.

MR LUKWAGO: Madam Chairperson, I do accept that there is no aspect of rape which is okay. It was just a slip of the tongue. (Laughter) What I wanted to mean is that we are coming up with different categories of defilement. There is one which is mild and another which is aggravated. I am sorry for the word I used, and I do apologise.

However, the information I was giving to the honourable member is that we are talking about aggravated defilement, whose key elements are very clear. One, there is the element of age and another is infection with HIV. Your serostatus is a key element in this offence, which must be established at the time when the charge is being preferred against you. This is the whole point.

MR REMIGIO ACHIA: Madam Chair, in my conscience I am worried about this element. What we are trying to insert here is the aspect of testing ahead. In other words, we are trying to go against the principle of someone being presumed innocent, in this case of aggravated defilement, and it may be abused. If this law was passed a few months ago, it would have been abused by some people trying to frame others just to get them tested to establish their status- (Interjection)

MR MUGARRA KABAGAMBE: Madam Chairperson, I think time is a very important element in this case. If a matter goes to court and drags on for a year or two and an accused person tests positive, he or she can argue that they acquired the infection much later, say a year after defilement. This is possible because these cases are taking even two to three years in court. So it is very important that one is tested at the time of defilement.

MR RUHINDI: Madam Chair, I have read the mood in the House and I propose that we adjust 5(a) so that it reads, “Where a person is charged with an offence under this section, that person shall undergo a medical examination as to his or her Human Immunodeficiency Virus status.” Accordingly, 4(b) has to adjust, now that HIV is a very serious ingredient of the offence. Let us remove, “the offender has reason to believe” so that it becomes, “where the offender is infected with Human Immune Deficiency Virus.” So, immediately that happens, a test is done and that is it.

MR KABUUSU: Thank you, Madam Chairperson. I want to know from the Attorney General what will happen in a situation where the offender is infected with HIV/AIDS by the victim of aggravated defilement. (Laughter) Sometimes victims are born with HIV/AIDS. I am saying this because I am very knowledgeable in this field. Are we legislating on infecting a person with HIV/AIDS or aggravated defilement? This is my concern.

THE DEPUTY CHAIRPERSON: Honourable member for Kyamuswa, in law we have a maxim known as “volenti non fit injuria”; If you volunteer to take a risk, you shall not be heard to complain. So, if you rape somebody who has got HIV/AIDS, that is your problem.

DR BARYOMUNSI: Madam Chairperson, I just want to inform him that the HIV/AIDS Committee is drafting a comprehensive HIV/AIDS law, which will come to this Parliament for debate. I am sure it will address some of those concerns. I also want to allay the fears of some members. When the medical people test the offender, they do not have to give the results to this person. The results will be for the court to help it make a decision.

THE DEPUTY CHAIRPERSON: Okay, honourable members, I would like to recommit. Are you going to apply for recommital?

MR RUHINDI: There are two more amendments in this section. I suggest that in clause 6 of the same section, as indicated in 3 in the amendments, immediately before the definition of “serial offender” we insert the following definition: “‘Disability’ means a substantial functional limitation of daily life activities caused by physical, mental or sensory impairment and environment barriers resulting in limited participation.”

The justification is to provide a standard definition for disability, which is in line with the definition of the same expression in the Persons With Disability Act of 2006.

THE DEPUTY CHAIRPERSON: Is that all? You could probably complete all of them.

MR RUHINDI: Another amendment concerns the definition of “sexual act”. I propose that we delete that definition in the Bill and insert the following new definition:

“‘Sexual act’ means-

(a) penetration of the vagina, mouth or anus, however slight, of any person by a sexual organ;

(b) the unlawful use of any object…” The difference is that the word “unlawful” was not there in the previous one. We are inserting it to protect the victims. So, it should read, “the unlawful use of any object or organ by a person on another person’s sexual organ.”

As a consequential amendment, we are redefining “sexual organ”. Instead of the word “includes” it should read “means” so that we can have, “a sexual organ means a vagina or penis.”

MR NYOMBI: The committee also recommended that a new sub-section (7) be added to read as follows: “For avoidance of doubt, where both the offender and the victim of attempted defilement or aggravated defilement are below 18 years of age, they shall be regarded as children in need of care and protection and such a case shall be dealt with under Part X of the Children Act.”

MR RUHINDI: Madam Chairperson, I do agree with the substance of the amendment as proposed by the Legal and Parliamentary Affairs Committee. However, we have segmented it in order to distinguish, because there are two parts in the Children Act. One part deals with children below 12 years and the other with children above 12 years. This is because 12 years is the criminal age.

I propose, therefore, that part 1 reads as follows: “In the case of child to child sex, where the offender in the case of any offence under Section 129, is a child under the age of 12 years, the matter shall be dealt with as required by Part V of the Children Act.”

I also propose that part 2 reads: “Where an offence under section 129 is committed by a male child and a female child upon each other when each is not below the age of 12 years of age, each of the offenders shall be dealt with as required by Part X of the Children Act.” That means that they are both tried in a family and children’s court and if found guilty, both are taken to remand homes because they are children who need protection and care.

THE DEPUTY CHAIRPERSON: Honourable Attorney General, I do not know what you are talking about. Are you substituting or that is your proposal?

MR RUHINDI: I am substituting this amendment for what I have proposed, but the substance remains the same.

THE DEPUTY CHAIRPERSON: Is that okay?

HON. MEMBERS: Yes!

MR TUMWESIGYE: I request you to allow me improve on what the Minister suggested regarding paragraph (b), where the offender is infected with HIV. I prefer, for avoidance of doubt, to add the words, “with or without his/her knowledge.” I believe this will encourage people to go out and test for their HIV/AIDS status. Should they get interested, then they are able to know -(Interruption)

THE DEPUTY CHAIRPERSON: But hon. Elioda, we are dealing with criminals. Honourable members, I put the question that Clause 2(b) be amended as proposed by the honourable Minister.

(Question put and agreed to.)

Clause 2, as amended, agreed to.

THE DEPUTY CHAIRPERSON: Honourable members, I propose that a new section be added to section 129 as proposed by the Attorney General.

(Question put and agreed to.)

Clause 3

MR RUHINDI: Madam Chairperson, the Legal and Parliamentary Affairs Committee had proposed an adjustment to a definition in respect of clause 3, which we agree with in substance except for the drafting component. So, we are proposing that the definition of “deadly weapon” includes:

“(a)(i) any instrument adapted for shooting, stabbing or cutting and any imitation of such an instrument;

(ii) any substance, which when used for offensive purposes is capable of causing death or grievous harm or is capable of inducing fear in a person that it is likely to cause death or grievous bodily harm.

(b) any substance intended to render the victim of the offence unconscious.”

The justification is to expand the definition of “deadly weapon” to include instruments like hammers or substances such as acids, which though deadly are not designed for shooting, stabbing or cutting. Also substances such as chloroform which may be used to render the victim of the offence of robbery unconscious to enable the offence be executed.

MR LUKWAGO: Madam Chairperson, I do appreciate and welcome this proposed amendment, but I have a slight problem with the aspect in sub-section (ii). It says, “Any substance, which when used for offensive purposes is capable of causing death, grievous harm, or is capable of inducing fear in a person, that it is likely to cause death or grievous harm …” it is this last aspect that I am concerned about. Madam Chairperson, this seems to be quite ambiguous and too subjective.

True, robbery is a serious offence but a person can come with a very simple stick and he uses it to induce fear into me as an individual and can also use it to threaten me with death or bodily harm, yet such a simple stick cannot be categorized as a deadly weapon. My position is that sticking to this will lead us into opening floodgates in this particular area of criminality. Very many people will be convicted of robbery instead of these other cases of assault, trespass to a person, theft and so on. We should restrict it and not leave it so open to cover all those simple aspects. That is my humble submission.

THE DEPUTY CHAIRPERSON: But hon. Shadow Attorney-General, even if you use a small stick but your intention is to create fear and rob, that is your intention. Your intention is to cause fear no matter whether you are using a small stick or not; because why do use it?

MR NYOMBI: We actually dealt with the aspects hon. Lukwago is talking about by proposing an amendment to sub-section (ii) of clause 3 such that instead of saying “be sentenced to death,” those words be substituted with, “liable to suffer death.” Somebody may come with a stick and because of fear you believe he has a deadly weapon too and so he is able to achieve his end. Such a person has robbed. However, the position of the committee is that it should be left to the Judge to determine whether to sentence such a person to death or not. That is why we do recommend that sub-section (ii) be amended by substituting the words, “be sentenced to death,” with, “liable to suffer death,” and hence giving the judge the opportunity to determine whether actually this person should be sentenced to death.

THE DEPUTY CHAIRPERSON: If you are objecting, please give your reason.

MR RUHINDI: I do not object.

THE DEPUTY CHAIRPERSON: Honourable members, I put the question that clause 3 be amended as proposed by the Minister -(Interjection)- no, the Minister has got his own amendments, different from those of the chairperson who said that he has got another sub-section. Isn’t it? Are you creating another sub-section?

MR NYOMBI: It is an amendment. Actually the Minister moved a bit fast. It is an amendment, which we propose to sub-section (ii) of clause 3. We did it in view of the proposed amendment in sub-section (iii). True, if I came here with a toy gun I could commit a robbery but should I suffer death as a result? That is why we did propose under section 2 that the words, “be sentenced to death,” be substituted with, “liable to suffer death,” to allow the judge determine whether if I used a stick to carry out a robbery, I should suffer death.

THE DEPUTY CHAIRPERSON: Okay, I put the question that clause 3 be amended as proposed by the chairperson of the committee.

(Question put and agreed to)

Clause 3, as amended, agreed to.

Clause 4

THE DEPUTY CHAIRPERSON: I put the question that clause 4 do stand part of the Bill.

(Question put and agreed to)

Clause 4, agreed to.

Clause 5

MR RUHINDI: Madam Chairperson, this is more of a consequential amendment, except in a different category. This is in respect of smuggling where a deadly weapon is used. We do agree with the Legal and Parliamentary Affairs Committee on the substance of the amendment except in terms of drafting and we propose that it should read, “In this section, deadly weapon includes:

1. An instrument made or adapted for shooting; stubbing or cutting; and any imitation of such an instrument.

2. Any substance, which when used for offensive purposes, is capable of causing death or grievous harm and is capable of inducing fear in a person or it is likely to cause death or grievous bodily harm; and

3. Any substance intended to render the victim of the offence unconscious.”

The justification is to expand the definition of deadly weapon to include instruments like hammers, or substances such as acid, which though deadly are not designed for shooting, stabbing or cutting, and substances such as chloroform, which may be used to render the victim unconscious to enable the offence to be executed.

THE DEPUTY CHAIRPERSON: Chairperson of the committee; is that okay?

MR NYOMBI: We agree.

THE DEPUTY CHAIRPERSON: Honourable members, I put the question that clause 5 be amended as proposed by the Attorney-General.

(Question put and agreed to)

Clause 5, as amended, agreed to.

Clause 6

MR NYOMBI: The committee recommended that paragraph (b) of section 6 be deleted. Cases that have commenced in courts where they were initially heard should be completed.

THE DEPUTY CHAIRPERSON: Any objection hon. Attorney-General?

MR RUHINDI: No objection, Madam Chairperson.

THE DEPUTY CHAIRPERSON: Honourable members, I put the question that clause 6 be amended as proposed by the Chairperson, Legal and Parliamentary Affairs Committee.

(Question put and agreed to)

Clause 6, as amended, agreed to.

The Title

THE DEPUTY CHAIRPERSON: I put the question that the title do stand part of the Bill.

(Question put and agreed to.)

The Title, agreed to.

MOTION FOR THE HOUSE TO RESUME

4.45

THE MINISTER OF STATE, JUSTICE (Mr Fred Ruhindi): Madam Chairperson, I beg to move that the House do resume and the Committee of the whole House reports thereto.

THE DEPUTY CHAIRPERSON: Honourable members, I put the question that the House do resume and the Committee of the whole reports thereto.

(Question put and agreed to.)

(The House resumed, the Deputy Speaker presiding­.)

REPORT FROM THE COMMITTEE OF THE WHOLE HOUSE

4.46

THE MINISTER OF STATE, JUSTICE (Mr Fred Ruhindi): Madam Speaker, I beg to report that the committee of the whole House has considered the Bill entitled the Penal Code (Amendment) Bill, 2006, and passed it with amendments.

MOTION FOR ADOPTION OF THE REPORT FROM THE COMMITTEE OF THE WHOLE HOUSE

4.46

THE MINISTER OF STATE, JUSTICE (Mr Fred Ruhindi): Madam Speaker, I beg to move that the report from the Committee of the whole House be adopted.

(Question put and agreed to.)

(Report adopted.)

BILLS

THIRD READING

THE PENAL CODE (AMENDMENT) BILL, 2007

4.47

THE MINISTER OF STATE, JUSTICE (Mr Fred Ruhindi): Madam Speaker, I beg to move that the Bill entitled the Penal Code (Amendment) Bill, 2007 be read for the third time and do pass.

(Question put and agreed to.)

A Bill for an Act entitled “The Penal Code (Amendment) Act, 2007”

MS ALASO: Madam Speaker, I need your help just to understand some things. I thought when we passed the title - it was the Penal Code (Amendment) Bill, 2006 and now we are passing it and saying “2007”. I just need to be helped to understand.

MR RUHINDI: I was just trying to paint a clearer picture for the House because normally these are consequential amendments. When the Bill passes and it is being printed as an Act of Parliament, it will reflect a current year, the year in which it is passed. So, it is just a simple thing.

THE DEPUTY SPEAKER: I think we have given it a third reading.

MINISTERIAL STATEMENT

4.49

THE MINISTER OF STATE, INVESTMENT (Prof. Semakula Kiwanuka): Madam Speaker and honourable members, this is a statement, which follows questions raised by hon. John Kawanga and several other honourable members of this House, who needed to be informed of Government’s past involvement in Apparel Tri-Star Limited, as well as the current and future considerations. Although the statement may not exhaust all the various issues, it presents what I consider to be the most salient issues for taking the process from the current law to a viable position not only for Tri-Star but the entire textile industry.

Consequently, the information provided includes the potential of using an integrated textile mill to increase exports, employment, economic growth and poverty reduction. The statement provides information on ownership of the company, commitments by Government and objectives of doing so, past operations, current value of the company and hence status of the investments, value additional activities, payment of creditors and proposed steps for rectifying the situation.

In summary, the government intends to cause a restructuring of the company whereby a core private investor will take up majority shares from the current Tri-Star and at the same time, Government will convert its current credits to equity and if necessary make additional investments to ensure a share capital of 35 percent, which shall later be sold to Ugandans, preferably through the stock exchange.

The potential for the textile industry

It is worth noting that from the beginning, Government interventions in the textile sector, both generally and to individual actors including subsidies to farmers through the price support mechanisms, are primarily aimed at making the sector more viable and able to realise its potential contribution to the economy. The textile industry in Uganda has a great potential to enhance economic growth through increased export revenues, creation of employment and eradication of poverty for millions of people, especially in the Northern, Eastern and Western parts of the country where cotton is widely grown.

In fact, a report by the Committee on Finance, Planning and Economic Development of the Seventh Parliament showed that revamping the textile sector would create an estimated 7.5 million jobs as follows: cotton growing, 3 million; ginning, 1 million; spinning, 500,000; weaving and knitting, 1 million; stitching, 1 million; other packing, transporting, trade, 1 million; and the total, 7.5 million jobs. Madam Speaker, the source of this information is a report of the Committee of Parliament on Finance, Planning and Economic Development.

In addition to exports, there is a big internal demand for textile products of about 210 million square metres of fabrics every year. The importation of second-hand clothes is estimated to cover 81 percent of the local demand, while importation of new fabrics covers 12 percent of the local demand. The balance of 7 percent is met through the domestic production. This clearly shows the great potential of developing the textile sector both as a local and foreign market requirement. Thus, the background of Government’s involvement with Tri-Star is embedded in the desire to promote the textile sector, more specifically by taking strategic advantage of opportunities such as the African Growth and Opportunity Act, also known as AGOA.

The objectives and interests of Government in ATUL

After the United States Government announced AGOA, the government of Uganda was the first to come up with modalities of how best to benefit from the initiative. The initial plans included focusing on export of cotton products, whose value addition would increase export earnings for the country. Given the limited knowledge of Ugandans especially in the detailed requirements for penetrating the American market, Government thought it wise to contact a foreign company. Such a company would bring the much-needed skills contacts ability to meet required international standards and other benefits associated with branding.

Consequently, the Chief Executive Officer of Apparel Tri-Star (ATS) Sri Lanka, Mr Kumar, was invited after a conference that was held in the country on investment opportunities that would be captured through targeting the US market. This company was found to have been operating in the textile apparel sector for quite a long time and had many contacts and customers in Europe and America. Though Uganda was eligible to export to the US market even before AGOA, no exports, particularly in textiles where the country could easily have advantage, had been made up to that time. Eventually ATS Sri-Lanka was invited to Uganda mainly because it had the advantage of being an already established player in the American market.

Due diligence was done on the company to establish competence, leading to the signing of a Memorandum of Understanding between the government of Uganda and ATS Uganda. Thus, on 24 April 2002, the government of Uganda entered into an MOU with Apparel Tri-Star Uganda Limited to enable the exploitation of concessions and benefits granted to Uganda under AGOA.

The ATL pilot project was intended to add value to Ugandan cotton and establish the viability of making and exporting Apparels to the US market. The long-term vision was to enable vertical integration of the textile industry from the planting of cotton to final processing, and increase export revenues. Uganda particularly sought to benefit from the special provision that allowed lesser developed countries to enjoy duty free access for apparels made from fabrics originating anywhere in the world until 30 September 2007. This deadline has been extended to September 2012 by the African Investment Incentive Act of 2006, which was signed by President Bush, on 20 December 2006.

In the MOU, the government was to provide the cost of infrastructure and working capital to cover part of the transport expenses and taxes, all of which became part of the incentive structure for the new company. There were prohibitive transport costs of bringing raw materials from Mombasa to Kampala, and taking the finished product back to Mombasa for shipment. Government was to subsidise the transport because of these additional costs.

The foreign partners were to provide:

(i) Skills transfer; and

(ii) Market access (especially the US market).

The managers brought 73 employees from Sri Lanka who had over 15 years’ experience in manufacturing garments.

More specifically in the MOU, Government agreed to undertake the following obligations, among others:

1. Refurbishment of the building identified to house the training centre, factory and other facilities.

2. Identification of young people to be trained; and provision for their accommodation and upkeep;

3. Facilitate Tri-Star to obtain a loan facility of US $2.5 million of which US $1.5 million was to be made available as capital investment for the importation of machinery, and US $1 million for working capital. Tri-Star was to provide the necessary securities as required by lending institutions.

4. The working capital component included payment for salaries and transport costs. Specifically it was agreed that the government would pay 71.5 percent of the railway transport charges of each container of raw materials and finished goods from Mombasa to Kampala and back to Mombasa, during the first year of operation.

5. Payment of taxes and duties on machinery, equipment, furniture, vehicles and other inputs imported or procured by ATUL.

The Government pledged to avail 6 acres of land at Bugolobi, the former Coffee Marketing Board premises. As such, part of the Coffee Marketing Board complex was converted to suit the factory at approximately Shs 5.8 billion. The assets of the former CMB were disposed of by the Uganda Property Holdings Limited through a public auction and the proceeds were retained by the company. These premises comprised plot 29A to 41A and the adjacent land plots 1-7 known as Kalintunsi Road, which were initially sub-leased from Uganda Properties Holdings Limited for a period of 5 years with effect from 31 December 2004 extendable to 49 years for development of a cotton spinning factory. Only the land leased from Uganda Properties Holdings has a requirement for rent at Shs 20 million per annum.

Ownership of Tri-Star

Apparel Tri-Star Uganda Limited is a private liability company incorporated on 20 April 2002. The shareholders and directors were: Veluppilai Kananathan, Kanitha Kumar Lal Denapura, Ranjithi Silva, Ranjithi Charles Ekanayake, and Shion Chamindha Kumar. The assets of ATUL, which are movable property, were valued at Shs 6.63 billion at the end of 2006.

Government investment in Tri-Star

Over the years, Government has made the following specific investments:

(a) In 2002, Government pledged to facilitate Tri-Star to obtain a loan facility of US $2.5 million at an interest rate of 7 percent per annum with a grace period of one year of which US $1.5 million was to be made available as capital investment for the importation of machinery and US $1 million for working capital.

(b) After commissioning of the factory, the government provided another US $0.5 million for further enhancement of the company’s operations.

(c) Later on, the Bank of Uganda guaranteed funding to the company of US $3.342 million from DFCU Limited, US $0.9 million from DFCU Bank and US $1.758 from Stanbic Bank.

(d) Thus in total, Government has provided US $9.4 million to Tri-Star.

In spite of the difficulties made in this venture, the following gains, among others, have been realised:

i. The company has provided skills and employment to over 3,500 people in the making of garments. These are all part of a team of committed and dedicated workers, which is a contribution to the transformation of society.

ii. The company has demonstrated access to the US apparels market. There is a well-established market network in the United States and a direct link with the reputed departmental stores in the US.

Madam Speaker, I had the opportunity to work as my country’s representative in New York for eight years and I can testify the fact that Tri-Star supplies some of the leading departmental stores in New York. I know that for a fact.

iii. Tri-Star has created demand for the “Made in Uganda” garments -(Interruption)

MR OTTO: Honourable minister, with due respect to the report that I am following keenly, you have just informed us that you served your country for eight years in the US as an ambassador. However, I am well aware that in 2001 you contested against Michael Mabikke in Makindye and got 1 percent of the votes. AGOA started exporting its products in 2002 so what are you saying that you know reputable firms in the US yet you were in the country at the particular time when they started exporting these products?

PROF. KIWANUKA: I was informing this House that Government has made gains out its investment in Tri-Star and I was on point two that it has demonstrated access to the US apparel market. There is today a well-established market network in the US and a direct link with reputed departmental stores.

iii. Tri-Star has created demand for “Made in Uganda” garments in the most difficult USA market. The USA market is highly price sensitive and quality conscious.

iv. Tri-Star has produced pants and shorts with output rising from 537,756 pieces in 2003 to 73,365,528 pieces in 2005. That is an increase of over about 9 percent.

v. Total export sales since the project’s inception is equivalent to US $10.173 million.

vi. There is a state of the art factory establishment with two units using computer guided designs and which is considered to be one of the best factories in Africa.

vii. The current assets at the factory are equivalent to Shs 6.3 billion.

The following are some of the challenges responsible for the poor or unsatisfactory performance:

1. The company made its first exports in December 2002 after which no exports were made in the first ten months of 2003. This was due to the non-availability of pre-shipment finance based on letters of credit received for exports. The business model in the apparels industry is such that based on export letter of credit from the buyer, the company has to establish import letters of credit for purchases of fabric and accessories.

According to banking regulations, commercial banks insist on security to provide pre-shipment finance. Hence until the government was able to facilitate such a security, the company could not obtain any orders till about July 2003. The company continued to incur all the costs especially labour during this non-productive period since it would have been more costly to re-train the people.

2. Due to lack of apparels industrial culture in the country, the learning curve became longer than expected resulting in low productivity and more costs in supervision.

3. Though the government agreed to reimburse 71.5 percent of transport costs, this was not done and resulted in high costs of doing business compared to neighbouring countries with seaports.

4. For reasons beyond management’s control, in 2005 Stanbic Bank unilaterally decided to withdraw the letter of credit (LC) facility of US $1.5 million and an overdraft of US $600,000. The bank cited reputation risk. The company’s reputation had been tarnished by among others press reports on treatment of labour and financial losses. This resulted in the facilities being transferred to DFCU Bank. Though initially DFCU Bank agreed to provide the entire facility, it later changed its position based on exposure to single account and refused to accept facilities of more than US $1.095 million for LC. This happened in the middle of 2005 and it meant that the company was not able to accept more orders.

The company tried to arrange this facility through another bank but the Bank of Uganda was not in favour of dealing with more than one bank. As a consequence the balance of the approved letters of credit facility was not available and the company’s ability to operate viably was further constrained.

5. The Multi Fibre Agreement known as MFA of the WTO expired in January 2005. This resulted into the whole world having quota free access to the USA market. Therefore, after January 2005, the only real benefit for AGOA countries was duty free access compared to other countries especially the Asian ones. The buyers started looking for integrated factories in the AGOA countries to ensure better lead time coupled with duty free access to give them competitive advantage compared to Asian countries where the lower production costs, efficiency and shorter lead times cannot be matched. Uganda could not take advantage of these benefits partly because of lack of an integrated factory.

6. Towards November 2005, the energy problem in Uganda took a nosedive and caused major setbacks on the orders at that time. In spite of the availability of back-up power, it was not possible to operate a full schedule using this type of alternative power. Unlike other industries in the country, not only was Tri-Star unable to pass on the additional production costs to the buyers due to worldwide competition but also could not inform the buyers of the infrastructure issues since this would drive them away for good.

Therefore, management made a strategic decision not to canvass new orders until the power issue is resolved. This resulted in no more sourcing for orders and markets between December 2005 and March 2006. Later on from May 2006, the company was given uninterrupted power supply during day time, which gave them an opportunity to at least operate 60 percent of the installed capacity.

Due to the above reasons, the order situation in 2006 reduced but the potential for Uganda’s exports through AGOA remained very high. By the time it scaled down its activities, Tri-Star had a workforce of almost 1,500 people. Presently about 490 workers or 30 percent are working on textile orders for both Tri-Star and a sister company, Pheonix Logistics. Eventually the company intends to retain all the previous workers under conditions of service that are in accordance with the law.

Madam Speaker, I have the honour to inform this august House that Uganda still has a lot of potential benefits to reap from AGOA in terms of export revenues, creation of employment, promotion of the textile industry, cotton growing in particular and hence poverty reduction. It is, therefore, important that Government continues to engage in this noble task following a clearly defined strategy.

In 2006, Cabinet directed that a legal audit be done on Tri-Star to establish among others the ownership, shareholding status and share capital of UTL, assets, liabilities and finally how the company could be wound up or restructured to protect Government interests.

In light of the challenges of reviving Tri-Star in its current state and the findings of the legal audit, Government considered a number of options including restructuring of the company’s ownership status to allow a core investor known as Libya Africa Portfolio (LAP) Textiles to take up 60 percent of the shares and inject new capital of US $35 to US $40 million in the textile factory; and US $9 million in the operations of the current establishment.

The Government is expected to own 35 percent of the shares through a debt-equity swap arrangement. Minority shares of five percent will be provided to the present shareholders on the basis of money they have personally lent to the company (about US $350,000) and good will, that is, skills transfer and market access.

The new company, LAP, will also engage in the development of an integrated textile mill comprising of spinning, weaving and finishing processes within the existing premises at Bugolobi. A review of the performance of Tri-Star indicated that by running the garment factory through importing fabric from the Far East the margins are very minimal and the project cannot break even hence the need for additional investments to make it a vertically integrated factory.

A feasibility study by the Ministry of Tourism, Trade and Industry has shown that spinning is highly viable in the country and will increase value addition and retention of earnings by the country. The integrated textile factory will present plenty of opportunities for international markets, regional as well as local markets. The table before us shows the expected earnings from exports of yarn alone. The table shows the following:

In the first year, 60 percent plant utilisation would earn US $6.6 million. In the second year, with 80 percent of plant utilisation, one would earn US $8,000,800. In the third year, when 97 percent of plant utilisation is done, the company would earn US $10.865 million. The source is the feasibility study, which was undertaken by the Ministry of Tourism, Trade and Industry.

Establishment of the spinning segment of the chain will, among other, things do the following:

1. Reduce the cost of importing fabric from likely competitors in Asia.

2. Reduce the lead time that is very high in Uganda.

3. Add more value to the locally produced cotton, something that Tri-Star could not do due to lack of anticipated capital.

By adding value in all stages as demonstrated in the table above, the new company will export the following products: the yarn, fabric, garments, bed sheets, underwear, gray fabrics and organic cotton.

Conclusions and the future of the textile sector in Uganda

Madam Speaker and honourable members, I have already indicated reasons why the government is still interested in the continuation of the activities currently being undertaken by Tri-Star. The benefits being referred to here include:

1. Creation of employment.

2. Increasing export revenues.

3. Further stimulation of economic growth and the eradication of poverty especially among the poor farmers in many of the cotton growing areas.

In future the government intends to further streamline the process of promoting the textile sub-sector by presenting a comprehensive industrial policy that clearly specifies the investment promotion incentives, including special incentives for strategic industries such as the textile industry.

The management of Tri-Star still has an advantage of established markets, technical skills of garment manufacturing for export, which can help the new company to augment its knowledge of markets. In the long run, the people of Uganda stand to benefit immensely from an active, vibrant, integrated textile sector that is linked to a large world market –(Laughter)- such as the United States. We should, therefore, look at the lessons learnt from this pilot project and use them to refocus and support future investments in the textile sector.

Before I sit down I would like to inform the honourable members that the Libyan company has been in the country for a month. They have studied the textile industry. They are prepared to bring in capital in the regions of US $35 and US $50 million dollars. These are experienced textile operators. Their local manager is already on the ground and we as a country will benefit by overcoming the major constraint, which was a capital constraint; and the under capitalisation of Tri-Star. I thank you.

5.31

MR JOHN BAPTIST KAWANGA (DP, Masaka Municipality, Masaka): Madam Speaker, I wish to thank the honourable minister for this comprehensive statement. At least for the first time Ugandans now know something about Tri-Star. As regards your statement, honourable minister, I want to ask the following questions:

First, was there any study made by Government before it went into this undertaking and if so, who made it?

Two, in your statement you refer to ownership of this company. This is on page 6. You mentioned the various shareholders and directors, and these now belong to a company called Apparel Tri-Star Uganda Limited. I want to know, is this a private limited liability company registered in Uganda, or a foreign registered company, which is registered as such in Uganda? You mentioned the directors. Will you please tell us what experience each one of them has in the textile industry?

In the same statement you said the assets of Apparel Tri-Star Uganda Limited, which are movable property, were valued at Shs 6.63 billion at the end of 2006. First of all I would want to know, what are those movable properties and who valued them?

In light of that, I would want to know the share capital of this company. You make no reference to the share capital of this company and what they injected into the business. I ask this because while you refer to the moveable property of the company on page 6, when you go to page 8 of your statement you call it the current assets of the factory. I do not want to confuse the factory with the company. I want to be sure, is 6.63 the assets of the factory or of the company?

And finally, on page 11, you talk about Cabinet directing a legal audit of this company, what business does the Uganda Government have in auditing the assets of a private limited company and directing that it should be done, and restructuring it, and whatever you are doing? I think the others can be asked where they are –(Laughter)

5.36

MR NANDALA-MAFABI (FDC, Budadiri County West, Sironko): Thank you very much, Madam Speaker. I would request the Minister of Finance to listen. On 22 February 2007, the Minister of Finance, Dr Ezra Suruma said on the Hansard page 1646, when we asked the question, “Where did you get the authority to lend?” and I said this, “Mr Speaker, the authority as I understand was given by Bank of Uganda, not by the government of Uganda. Other loans, which were given by Uganda Development Bank, do not require a guarantee of Parliament to lend since they are banks.”

Under the Constitution of Uganda, page 125, Article 162 (2) that is about functions of Bank of Uganda: “In performing its functions, the Bank of Uganda shall conform to this Constitution but not to be subject to the direction or control of any person or authority.” The same Constitution under Article 154, that is, withdrawal from the Consolidated Fund, it says: “No moneys shall be withdrawn from any public fund of Uganda other than the Consolidated Fund unless the issue of these moneys has been authorised by law.” Then it goes on to say, “No money shall be withdrawn from the Consolidated Fund unless the withdrawal has been approved by the Auditor General and in the manner prescribed by Parliament.” I am giving you this so that you understand what we are going to discuss.

Madam Speaker and honourable members, recently we read in the papers that Mehta needed us $200 million or Shs 345 billion if they have to leave Mabira. We are asking him, “What investment did he put there?” We are yet to find out whom he paid before we pay. At the same time the Minister of Finance is saying this man should continue in business, and that we need to invest more money. Why should we invest in a loss-making venture? Why should we invest where we have no interest?

Madam Speaker, the Minister has mentioned banks that gave money. I have banks here, which he has not mentioned. We have Uganda Development Bank Limited; its first payment was done on 31 May 2005. Let me read for the Minister to understand. It says:

“Dr A.K.P. Apel, Member Uganda Development Bank; Restructuring Management Team Portfolio, Kampala. Dear Sir;

The funds you have received from the ministry this week are to be allocated as follows: Ms Apparel Tri-Star Uganda Limited is to be given US $1.5 million. The balance to Ms Pheonix Logistics Uganda Limited. The Ministry has no objection to disbursement of these funds for your appraisal.”

They sent US $3.7 billion dollars and if you convert, you know how much that was. Tri-Star had to take US $1.5 million. You do not mention about this, I do not know why!

Madam Speaker, money was also given to Orient Bank. This is signed by the Secretary to the Treasury, Governor Bank of Uganda. Opening letter of credit for US $443,618; I do not see you mentioning this and this were passed through Orient Bank. Given the fact that you are not discussing all the moneys, it looks like there is a problem.

The Committee of Finance, which you mentioned, had a meeting with Bank of Uganda. This is a meeting with the Committee on Finance Planning and Economic Development. This was on 3 December 2003. Bright Rwamirama, I think, was the chairman. They were saying that under the circumstances, Bank of Uganda secured a loan for Apparel Tri-Star to the tune of US $2.1 million in hard currency. This money was passed to Stanbic Bank. In your reading you said Stanbic gave US $1.7 million. If you read page 7, point (c), Stanbic Bank gave US $1.758 million and yet we know you gave US $2.1 million. You have not mentioned the interest, which has accrued. Why did I read Bank of Uganda? I will read you a letter. On 25 February –(Interruption)

THE DEPUTY SPEAKER: By the way honourable, what is that book you are reading?

MR NANDALA-MAFABI: It is a compilation we have made, which I am going to lay here on the Table after this. It is for all of you to consume. On 25 February 2004, this is from the Governor Bank of Uganda, to Apparel Tri-Star Uganda Limited:

“This is to direct you,” and recall what I read for you, “to use the Apex to reinforce and finance Apparel Tri-Star Uganda Limited as follows:

• US $0.5 million as additional letter of credit

• US $0.4 million as additional overdraft facility, within two months; and a sum of US $3,342,000 as long-term finance to meet the expansion requirements.

Signed

Yoweri Museveni

President”

We know that Bank of Uganda is not supposed to be subject to the direction and authority of anybody. Why did I read the Consolidated Fund refinancing of Apex funds, Apex inflows? Colleagues who joined us in the Eighth Parliament, Apex are moneys, which the government of Uganda gets to be used to lend to our local businessmen at a low interest rate. When this money is paid back it is taken to the Consolidated Fund directly. That is why we have Apex 1 up to Apex, we are now going to I think, Apex 5. This money can only leave the Consolidated Fund after the approval of Parliament. Now they are saying, “use the inflows, which have gone to the Consolidated Fund”!

I recall as, yes, I can see you shaking your head you are free – well, I think let me make a point then you will come in –(Interruption)

MR KIVEJINJA KIRUNDA: Thank you hon. Mafabi for giving way. I want to correct one thing. Apex funds definitely come to the Bank of Uganda to be lent to the private sector but they do not go to the Consolidated Fund to be subjected to vote allocation by Parliament.

MR NANDALA-MAFABI: Thank you very much, honourable minister. The Apex fund comes through Bank of Uganda and the people who pay it do so through the Ministry of Finance. The Ministry of Finance pays the money from the Consolidated Fund and all the inflows are supposed to be put back in the Consolidated Fund. I am saying this because this issue arose in the Sixth Parliament and we had to ask for an audit. We have even confirmed all the agreements, and I would ask all the Members to go and read.

I would ask the Chief Whip, who is also my vice and who has these documents, to read them, in order to understand those agreements. There is even a letter here, which says that all the moneys of Apex are from Bank of Uganda. Let me show you the letter so that you understand. You know, Madam Speaker, you will bear with me a bit because we want to put this issue in perspective so that we know how Ugandans have lost out.

Here it is. I want you to listen to this; I will read the most important thing –(Interjection)- you want me to read everything? Okay, I will read it for record purposes.

I refer to the letter of 25 February 2005, Ref. P.O. 10, from the President, directing the Governor to use Apex inflows to finance Apparel Tri-Star Uganda Limited:

“Mr Apparel Tri-star needs to identify –(Interruption)

THE DEPUTY SPEAKER: But, hon. Nandala, who is writing to whom?

MR NANDALA-MAFABI: No, I am going to quote it, Madam, because they wanted me to –(Interruption)

THE DEPUTY SPEAKER: Who is the addressee?

MR NANDALA-MAFABI: This letter is addressed to Bank of Uganda, and is written by the Director Bank of Uganda, addressing the Governor and telling him about the issue of Apex inflows. I want to confirm this. The most interesting point here is that Bank of Uganda has been instructed by the minister to credit all the Apex inflow they have caused. The Public Finance and Accountability section provides that no money shall be withdrawn from the Consolidated Fund without the authority of the one assigned by the minister and addressed to the Accountant-General. That is why they are saying that the money is not on the Consolidated Fund and that is what I was trying to tell my brother Kirunda Kivejinja, or my grandfather –(Laughter)

We have moved away from privatisation –(Interruption)- Madam Speaker, can you protect me from the Chief Whip?

THE DEPUTY SPEAKER: Apparently she has a point of order.

MRS KABAKUMBA MASIKO: Madam Speaker, is it in order for hon. Nandala to refer to the Third Deputy Prime Minister as a brother and as a grandfather when in this House? I know there is a Mr and Mrs in this House but we are all referred to using the title “honourable”. In this case he is Rt. hon. Third Deputy Prime Minister. Is he in order?

THE DEPUTY SPEAKER: Honourable members, last week we had occasion to touch on this matter and we said that we should refer to each other with decorum and with the official titles. There is no grandfather of yours here. (Laughter)

MR NANDALA-MAFABI: Thank you very much, Madam Speaker, for the wise ruling.

Let us go to the real issues of Tri-Star. We are moving away from state enterprises to privatisation but here we are going back to state ownership. They are saying that Tri-Star had a problem of transport for raw materials from wherever to Uganda and back and were paying 7.15 percent. Meanwhile, you are saying you want to create jobs for 3 million cotton-growing people? Are the people who growing cotton out of Uganda or are they here in Uganda? If the cotton were here, there would be no need to incur the cost of transporting the raw materials. That is one.

Secondly, we put in Shs 5.8 billion, see page 5, in converting the factory to workable space. Now you are telling us that it is worth Shs 6.63 billion yet the money we have put in is, from your own calculation, Shs 9.4 billion? But for us we know it is more than Shs 9.4 billion. Where is our money? Who swallowed it? If what you are saying is that the orders were having letters of credit, we opened the letters of credit and we supplied and redeemed it. Having redeemed it, where did the money go? After all when we sell we get money. So which account did our money go to?

THE DEPUTY SPEAKER: But, Shadow Minister, if you could, wind up.

MR NANDALA-MAFABI: Yes, Madam Speaker, we must understand this. This is a serious issue and in fact, we need a full day for it –(Interruption)

THE DEPUTY SPEAKER: Members are also waiting to speak –(Interruption)

MR NANDALA-MAFABI: Yes, they will do it. Madam Speaker, if we have put in Shs 5.8 billion, which if we are to convert using a simple calculation, is about US $3 million. I am going to use your figure honourable minister and add Shs 9.4 billion, you get $ 12.4 million plus transport costs, taxes exempted, free factory and the experts. And every year, in Ministry of Industry and Trade, we have a budget for AGOA of Shs 1 billion to support Tri Star. You have not mentioned it here. I count about almost $ 20 million. We made a sale of $10.17 million. In your view, is this Economics? Is this positive trading or History? (Laughter)

If that is true, we had a number of companies including Lira Spinning Mill and Nytil. What is your linkage between those companies and this Tri Star where you are saying the market could not be sustained because the factory in Bugolobi was not integrated, because there were those raw materials –(Interruption)

MR ODIT: First of all, the Minister should tell us whether the claim he is making of the three million people who are employed in cotton production is authentic. Lira Spinning Mill, which you have referred to, is also a national scandal. In fact, we also require serious intervention from this Parliament because all the machineries were removed, taken away by the so-called investor and the buildings are just shelves. Honestly, this calls for another serious intervention. Thank you.

MR NANDALA-MAFABI: Thank you my brother Odit. [Members: “Honourable.”] Yes, hon. Odit. Hon. Odit cannot call me to order on that. He knows we are – we can cooperate.

Madam Speaker, when Tri Star – this information is very important for Members - went to DFCU to get money, they asked for audited accounts, because Stanbic had said, “You do not have audited accounts” and DFCU asked, “Where are the audited accounts?” They could not produce them but they wanted the money. Now, how do you get money without audited accounts and a business plan? The question to the Minister of Finance is- here they say, the accounts are not present- How were you assessing the performance of this company without audited accounts? (Applause)

They went and lied to Stanbic that, “Our money which will come in every month will be $800,000. Please give us a credit.” However, for three months, they brought in only $92,000. How did Government guarantee loans with a company, which was lying and saying every month they would bring in $800,000 and in three months they brought in only $92,000? And you continue to guarantee the same company!

I know Members want – this is now the final point. We have a company, which was sold here, namely Nytil, but Nytil has problems. It was sold to a company called Picfare, which eventually became Nytil Picfare. They never paid. Having not paid, they went back and borrowed money from CFC, all of you remember, $ 8.5 million and the government of Uganda paid on their behalf using our assets.

Eventually they formed a company called Southern Rangers, which we sold to them at Shs 1,000 and that is still Nytil under Picfare. You can see how these people who call themselves investors come here and loot us with the help of the Executive while we are seeing- (Laughter)- To confirm this, the MD who was there in Nytil Picfare, is the current MD Kishor in Southern Rangers and a shareholder. You can imagine, they just change names and rob us while we are seeing. They connive with the Executive. Are you going to agree that they connive and take us out again?

The Minister said the ownership is known. Then he is saying the Cabinet has said we get the legal ownership. What ownership did you read for us on page 6 and the one you wanted to carry out the audit for? In fact, Kishor by now should be in prison for theft of $20 million- (Applause).

MS MUGISA: Madam Speaker, actually there is information about Tri Star which can help you with some background. There is a man who came from China around 2003 and was presented to the “powers” that be. It was alleged that the man was from Wall Mart, one of the biggest shopping stores in America. This guy claimed he had spent 17 years working and living in America. After his 17 years, he did not even know English, let alone this conventional English we speak in Uganda and in this Parliament since we are senior six and above. The man could not even speak English, yet he had lived in America for 17 years and that he had brought market for Tri Star. What ever happened to that man, I do not know.

In 2005, they put some stock at Tri Star. Since I live in Bugolobi, I decided to go and see so that I could buy some items. I bought some clothes. They were not very expensive, but you cannot see them now. They are even worse than second hand clothes. They are all worn out. I actually think Tri Star is a very big flop which people should just not support -(Interjections)

That was the information I wanted to give him. At least you have a background. They are so many business clowns running around Uganda claiming they come from Europe. As long as they are white and carry briefcases, we get intimidated -(Laughter)

MR ODUMAN: Madam Speaker, I would like to give my honourable friend some more information on the money that has so far been transferred to Tri Star. In the Minister’s document on page 5, he says that Government agreed to provide working capital. In the memorandum of understanding, which you have seen, there is no mention of working capital provision to Tri Star. Who would not like to do a business where you are provided free working capital?

As a result of that, Government actually transferred Shs 6.1 billion to Tri Star between the period July 2002 and August 2004. That is additional to hon. Nandala’s figure of Shs.20 billion broken down as follows: In July 2002, Government through Uganda Property Holdings Limited (UPHL) transferred Shs.1.3 billion. In October 2002, Government transferred Shs.2.7 billion. In February 2003, Government transferred Shs.1.5 billion and in August 2004, Government transferred Shs.495 million, all totalling to Shs.6.1 billion.

Madam Speaker, what was that money meant for? That money was meant for payment of salaries, electricity, and other things. Additionally, the Memorandum Of Understanding (MOU) also provides that Apparel Tri-Star (ATS) shall rent that property in which they are housed. However, up to date, I am not aware of ATS having paid any coin for rent. They are occupying the premises for free, which is against the MOU.

The market value of the premises is in a range of Shs.15 million per month. If you multiply that by the number of years since 2002, it comes to about Shs.900 million. That is all additional to the figure that hon. Nandala is building.

Lastly, the figure given to us by the Minister as US $.9.4 billion does not include certain monies, which were transferred unilaterally by the Ministry of Finance through Uganda Development Bank (UDB) directly to ATS. On the 31 May 2002, Government instructed the release of Shs.3.7 billion to UDB. The instruction was to apportion it.

This is a letter addressed to UDB and signed by Keith Muhakanizi, the Permanent Secretary and Secretary to the Treasury. It reads, “Dear Sir, the funds you have received from this ministry this week are to be allocated as follows: MS Apparel Tri-Star Uganda is to be given US$ 1.5…” and the other beneficiary was –(Interruption)

MRS WINNIE MASIKO: Really honourable members –(Interjections)- listen to what I have to say, and for people who are not familiar with figures, it may be difficult to follow. What the hon. Member is reading is already given to us by hon. Nandala. As the Shadow Minister of Finance, Hon. Nandala gave us figures from the letter to UDB that he is referring to. I have realised that what hon. Okello is reading are the same figures only that he is reflecting them as if they are additional to what hon. Nandala has said. This does do not give us a clear picture.

The clarification I am seeking is to know whether those figures he is reading are the same as what hon. Nandala read as being a directive by the Secretary to the Treasury UDB to have $ 1.5 million transferred to Tri-Star. That is the clarification I want. It is intended to avoid double counting. Thank you.

MR ODUMAN: Madam Speaker, I am willing to lay this document on Table, so that we take the liberty to look at it though I have read the details of the letter with the date, addressee, author and the reference. Let me lay it on a Table before I read a whole list of transfers from Ministry of Finance to Tri-Star.

Lastly, Madam Speaker, the issue I would like to add –(Interruption)

MR DOMBO: Madam Speaker, I thank you very much. I have been provoked into this clarification especially by the submission by the Government Chief Whip. The statement given by the Minister seems to indicate that because of the high power tariffs, the company was affected in its production schedules and management. Yet according to the information given by the honourable member, Government was meeting the power costs. I fail to reconcile the two. Can the honourable minister clarify when the opportunity comes on how the divergence came about? I thank you very much.

MR ODUMAN: To finalise my submission, Madam Speaker, I refer you to the information on the last paragraph of page 5, of the document presented by hon. Nandala. It says, “The Government pledged to avail 6 acres of land.” The wording of the MOU defers. It says, “That Government pledges to avail for lease, 6 acres of land.”

While the report says the government pledged to avail 6 acres, the MOU says the government pledged to avail land for lease. So, how much money has Government received from the lease of the 6 acres since 2002. Thank you, hon. Speaker.

MR NANDALA-MAFABI: As you can see for yourself, Madam Speaker, Tri-Star is rotten –(Interruption)

THE DEPUTY SPEAKER: Excuse me hon. Member, where are you going? To photocopy?

MR ODUMAN: Yes, Madam Speaker, I need a copy of this.

THE DEPUTY SPEAKER: Okay.

MR NANDALA-MAFABI: Madam Speaker, I want to confirm that what hon. Okello was reading is a true document and I wish honourable; Bright Rwamirama and Ephraim Kamuntu were here, they would have known what we are talking about.

Madam Speaker as we are saying, we have made an investment and the Constitution and the Public Finance Accountability Act says that the Auditor-General will audit all the money we have invested anywhere. We do not have the Auditor-General’s report to show us our investment in Tri-Star because this is our investment. Since they have not even brought the investment here, it looks like somebody has done it deliberately so that it does not come. Much as we are talking about the money, Coffee Marketing Board was a coffee processing plant, but have we put the value on the plant that we destroyed for purpose of Tri-Star?

When they came to destroy Coffee Marketing Board it had been valued and it was going to start making Nescafe or instant coffee. I know and my colleague hon. William Oketcho will bear me witness that they opened on a Monday and closed on a Thursday at 6 O’clock for reasons best known to the people who handled the closure of Coffee Marketing Board. What I want to say here is that Coffee Marketing Board at that time had been valued with the assets in that plant at $100,000,000. Now it has been destroyed for sake of one gentleman called Kananathan who should be in prison.

You are saying they brought consultants but NYTIL, ATM Mbale; Lira Spinning Mill all existed before Kananathan came. Where were those people who used to spin and make clothes before Kananathan came? How can you tell us that you went and brought 73 competent people from Sri-Lanka yet we have our own?

In conclusion, Madam Speaker, I plead with Members that at the end they should arrest the thieves but Kananathan is more than a robber who should have been arrested by now. This is aggravated robbery. Thank you. Madam Speaker, I am laying a document here, which will need a full committee to analyse and understand the theft by the Executive headed by Kananathan.

THE DEPUTY SPEAKER: What is the document? Does it have a title and a date?

MR NANDALA-MAFABI: The title is Tri-Star. It has all the correspondences, the releases of money and the banks that rejected – mention it, Apex funds, it is all here.

THE DEPUTY SPEAKER: Are you the author of the document?

6.16

MR GAUDIOSO TINDAMANYIRE (NRM, Bunyaruguru County, Bushenyi): I thank you, Madam Speaker and I thank the Minister for having had chance to give us this report. Sincerely everybody would concur with me that this report is not a financial report on Tri-Star but maybe a historical report of the company -(Interruption)

THE DEPUTY SPEAKER: I want hon. Oduman to properly lay that document on Table. Name the document, the date, author and then we can continue.

MR ODUMAN: Madam Speaker, this letter is dated 31 May 2002, addressed to AK Apia, Member, Uganda Development Bank and it is authored by the PSST in the names of Chief Muhakanizi. I beg to lay it on the Table.

MR TINDAMANYIRE: Madam Speaker, I would term it possibly as a condolence report on Tri-Star. Tri-Star is a private company as said with shareholders. I want to know when the government started participating and putting in money. When did they restructure their shareholding? We have seen that about $ 9.4 million was injected in the company. How do you inject money in a company that you do not own and where you do not have shares?

I was a banker in Luweero for over 20 years and my duty was to analyse projects and appreciate ownership of companies. I shudder to see that our Government would put money in a company where they have no shareholding. I was a board member of Uganda National Housing Construction and a board member of Uganda Nile Hotel in 1994. This is the company that robbed Uganda and it was registered on 26 October 1994. Government gave Tunisia the company on 27 October 2007 and by then I was acting board chairman. I was locked in Kata’s room in the former Nile Hotel and the same thing went.

Tri-Star was registered on 20 April 2002 and the Memorandum of Understanding was signed on 24th April, four days later. I do not know if it was a weekend. That shows me a correlation of how Government loses money. Madam Speaker, isn’t that connivance?

When you talk of Shs 5.8 billion refurbishing Coffee Marketing Board, it is not added on the $ 9.4 million. When you talk of the current assets – for us in the banks when you bring us books to analyse, before giving you a loan, we would say assets equal to capital plus liability. Now what was the capital of the Tri-Star people and what was the liability? You wonder! In actual fact concerning the money Government injected, where it got the authority from is not reflected. Where did it go? The Minister should be able to tell where it went. In other words, I am trying to ask, where was the company’s actual contribution to the business?

Madam Speaker, an investor by nature of investment is supposed to invest. What did Tri-Star invest?. An investor by nature should be able to invest. When we see people coming in to invest, they should be able to contribute. You are paying 71.5 percent of the transport of raw materials whereas the aim should have been to help our people grow our cotton.

Logically why didn’t we say that actually we wanted to import raw material or a few things here and then export? I want to tell you that the AGOA system was a brainchild of the American Government to help African countries. Kenya as a country has gained over $ 190 million but Uganda– you cannot be proud of having received $ 12 million considering the amount of money we have put there.

When you talk of exports, according to the Minister’s report, they said that they exported up to December 2002 and then for ten months there was no export. Then what was the logic of injecting money? How much has Tri-Star Apparels actually paid UPHL as the people who gave them the factory?

When you look at the financial implication of this company, it is clear that Government has no mandate to even attempt to restructure it, because it is not a Government company. How do you restructure what you do not own? (Applause)- How do you tamper to enter, unless you want us to go by the story of Solomon Vs Solomon? Or you want us to open the veil and see what is in there- (Laughter)

In summary, Madam Speaker- (Interruption)

6.23

MR BIRAAHWA MUKITALE (NRM, Buliisa County, Masindi): Madam Speaker, first of all, I would like to thank my hon. colleague for giving way. In the African culture, it is not good to over mourn the dead. I am wondering why the Minister seems to be having hope in Apparel Tri-Star, which to me is already a dead entity. The Government did its best, gave it life support, tried to re-estate it, but all ended in vain. At this point in time, it is not expected of us to think of anything good from that company.

My information is that, as a country we seem to have over rushed into privatisation. Right now, we seem to be investing for investors; we have to spend on investors. We are imputing a bad motive; you must give partial risk guarantee; you must give free land; and now we must give our own money. We have even lost the virgin girls who came to work in Apparel Tri-Star - (Laughter)- I, therefore, would like to request that we bury Apparel Tri-Star and stop mourning. I thank you so much, Madam Speaker.

MR GODI: Madam Speaker, I want to conclude as follows: The report as presented by the Minister should be completely thrown out -(Applause)- and investigation should be carried out to establish how much money -(Applause)

I love the NRM Government and I adore it. However, I wish the velocity with which it arrests people who are treasonable, is the same with which they rush to arrest financial treasoners of this country it would save our future generation.

As a matter of fact, I would not want to see my sons and daughters and my constituents continue paying taxes just to be given to treasonous investors. I thank you, Madam Speaker.

6.25

MR WILLIAM OKECHO (Independent, West Budama County North, Tororo): Madam Speaker, I think it is important that we kind of conclude this. First of all, Government should not be in the business of running textile industries. I want to say that the issue of Government financing Tri-Star, and so forth was a reversal of the privatisation programme. It was not really what I, as a professional in that area, understood of privatisation.

We are happy that the Minister in charge of Privatisation is here and what I am saying is fundamental. We should not be made to believe that any further injection of money by Government, into the textile sector, will ever revive it; it is not going to be possible.

First, Government has to understand that textiles start with cotton. Cotton production in this country has totally collapsed. All evidence shows that there is no way Government will ever revive cotton production to the level where it will be viable to actually invest in the textile sector. You know very well that the plan to produce one million bales of cotton ever since, even using loans, has not been possible.

Secondly, the illusion that there is a big market here for textiles is really a facade of acceptance, if I may say, because the textile market we have here can only be satisfied by very cheap imports, which we cannot produce locally.

I have been in the textile industry as a manufacturer for over 15 years, and I know that we are not able to match the cost lines which all other textile firms in the world have because of what you know. There is no power and many other things. You also know that there is nothing for the textile sector. So, I really urge the government through the Minister of Finance in charge of Privatisation to forget any further involvement in the textile sector.

The intervention by Libyans that we were talking about is also not going to work. The Libyans will come but we shall never produce textiles at the cost that we want in order to meet this market because the Chinese on the other side will come with cheaper products and kick us out. Therefore, it is not going to be easy for us to revive the textile sector.

So, in summary, I am saying that we should forget all about the textile sector in Uganda. We should not inject good money into bad money. Thank you very much.

6.28

MR PETER NYOMBI (Independent, Nakasongola County, Nakasongola): Madam Speaker, I am proceeding on the assumption that the Attorney-General was not consulted before this deal was concluded -(Applause)- because if the Attorney-General had been consulted this arrangement would not have been made. Or if the Attorney-General was consulted and he advised that way then his office must be strengthened -(Laughter)

Madam Speaker, page 6 of the report says, “Tri-Star is a limited liability company.” I have practiced corporate law for many years. From what I know, I want say that even a recent graduate from Law Development Centre working for Government would not have entered into this arrangement.

The Companies Act regulates the setting up of private companies in Uganda. The first thing that is done is to draw a Memorandum and Articles of Association. The Memorandum and Articles of Association is actually an agreement between shareholders.

MR NYOMBI: On page 6, we are given a list of the shareholders. Nowhere among the shareholders does the government feature and yet when a company makes dividends, the dividends at the end of the day are shared in accordance with shares each shareholder is holding in a company. So, the government has no stake in this agreement; it is not a shareholder.

According to the Company’s Act, there are two structures in a company that must be in place. The first structure is the structure of shareholders. This is the most important because shareholders are actually the owners of the business. Nowhere among the list of shareholders is Government mentioned.

The second structure is the structure of the Board of Directors. We are not told in this statement whether Government was represented on the Board of Tri-Star. According to the Company’s Act, it is the Board of Directors, which manages the business of a company. Therefore, this was a bad deal right from the beginning.

Still on pages 5,6 and 7, we are told that Government went ahead to inject money into this company, but we are not told upon what security Government kept on pumping money into this business.

On page 5, we are told that Government was to avail land to this company. I am wondering whether the title for that property was transferred to this private company. It will be a problem for Government to reclaim the title if it was transferred.

MR NUWAGABA: Thank you, honourable member, for giving way. The company has a sub-lease and as a result of that it has a Certificate of Title by way of a sub-lease. That interest as you know can be mortgaged or pledged or dealt with.

MR NYOMBI: Madam Speaker, on page 11, we are told that Cabinet directed that a legal audit be done on Tri-Star to establish, among others, ownership, shareholding status, share capital, and assets. This should have been done at the beginning –(Applause)- We are further told that Government is considering restructuring the company. How do you restructure what is not yours? Government is not a shareholder; it does not appear to be represented on the Board, so, how will they restructure a private company? Tri-Star is not a public company; it is a private company. How will the restructuring be done?

Madam Speaker, I want to recommend that these plans of investigating further into this company be dropped because it will lead to a greater loss. Thank you. –(Applause)

MS KAYAGI: Thank you, Madam Speaker. I would like to thank the minister for that statement. The previous life of Tri-Star has been terrible -(Interruption)

MR DOMBO: Madam Speaker, sorry for the interruption. The previous speaker raised fundamental questions about the integrity of the Office of the Attorney-General. The Attorney-General is the lawyer of Government and is the lawyer of Parliament. These are fundamental questions being raised and which must be answered. I am standing to seek clarification. Will the Attorney-General’s office give assurance to this Parliament that actually we are well represented?

THE DEPUTY SPEAKER: Honourable member, the Attorney-General’s participation has not been mentioned in this matter. Unless you are asking about other areas where he should represent us. He has not been mentioned here.

MR NANDALA-MAFABI: Madam Speaker, the Attorney-General is the one who clears all contracts, all memorandums of understanding; in fact he handles any legal issue, which relates to Government. We can only exempt hon. Freddie Ruhindi because he was not there by then. We want to find out who cleared that memorandum of understanding? If it is the Attorney-General’s chambers, well, he might have to get what do.

THE DEPUTY SPEAKER: If they participated, they will explain their level of participation.

MS KAYAGI: Thank you, Madam Speaker. I was saying that the past life of Tri-Star has been terrible. The situation is very alarming. But when we look at the future of Tri-Star as stated by the hon. Minister, it looks like the future is going to be bright, which is not the case.

Why am I saying this? On page 12, the Minister says: “by adding value in all stages of processing, the new company will export the following products.” My major concern is on the last bullet, where he says, “organic cotton” –(Laughter) The hon. Minister knows very well that we passed the spraying of DDT in this country Uganda. With anything organic, you cannot bring DDT near it. Even if it is indoor spraying, crops or cotton will be detected to have DDT in it.

So, I am wondering whether the minister first consulted his colleagues before putting the word “organic” and then the word “cotton” –(Laughter)- among the things that the Minister thinks we are going to export as a country. I would really appeal to him that he cancels the item cotton out of this, or if it stays, then let it be plain but not with the word “organic” because it shall not be considered. I thank you.

6.38

MR ERIAS LUKWAGO (DP, Kampala Central, Kampala): Madam Speaker, a lot has been said. I am trying to convince my conscience on a number of issues, particularly about the statement itself. I do not think even the honourable minister believes any sentence in his own statement. I do not think so, Madam Speaker.

Having said that, just a couple of weeks ago, we condemned COWE as a bunch of thugs. I wonder why the honourable minister would not follow that precedent to condemn this other group of thugs. I am sorry to use that word, Madam Speaker.

Having said that let me go to a few specifics. Hon. Nyombi has alluded to a number of issues concerning the legal status. He has clearly outlined the company law as it stands today. There is one aspect I want to add, Madam Speaker, as regards the relationship we have with Tri-Star. There is no doubt it is a private limited liability company, and there is no doubt we do not have a joint venture agreement. What we have in place is a memorandum of understanding. I do not understand the legal status that memorandum confers in a company. What is that memorandum of understanding?

This is a private liability company and it is one entity while we have the government of Uganda, which is another entity. What brings us together? That memorandum of understanding has no place in corporate law. It would probably have been a joint venture agreement. I stand to be educated on this, hon. Minister.

MR NIWAGABA: On a point of law, a memorandum of understanding by its very nature creates either legal rights or obligations and it is enforceable.

MR GODI: I thank you, Madam Speaker and hon. Member for giving way. The information I want to give is, you have seen in the report that the government wants to come to the aid of Tri-Star by re-establishing it and giving Shs 35 million in a swap arrangement. However, when a company is coming to that stage under the Companies Act, there is what we call winding up a company. The company should have been wound first before the reinstatement comes in.

As it being wound up, there is usually the stage where the company goes into receivership. We want to know when that stage was passed before it comes to officially liquidate that company. Thank you.

MR LUKWAGO: Thank you for that information. Before I take leave of that matter I want to add that we are just cohabiting with Tri-Star. I am tempted to believe, Madam Speaker, that Tri-Star could just be a conduit for laying our hands on public coffers. It might just be a conduit and not a company owned by those people. Why am I saying so? This is the other aspect.

I have been to the company registry several times to at least have access to the Memorandum and Articles of Association of Tri-Star, but my efforts have yielded nothing, Madam Speaker. You cannot formally get the Memorandum Association and Articles of Association of that company. We wonder why? I would suggest, if possible, that the hon. Minister be compelled to lay on table these secret documents that is the Memorandum of Understanding and Articles of Association of this company. Let the Minister lay them on the Table so that we can have an opportunity of scrutinising them.

Finally, Madam Speaker, they talked about Shs 6.6 billion in assets and our injection as it stands now, which is said to be about Shs 17 billion. I am wondering in addition to the questions already raised what the contribution of Tri-Star is? If the capital –(Interruption)

MR BAHATI: Thank you very much, Madam Speaker and thank you hon. Lukwago. The information I wanted to give is that, in the first place as a professional accountant, I do not know if this Parliament should be subjected to figures that are not audited. In accounting we have management and audited figures. If you are discussing internally you can handle the accounts internally and discuss them.

However, if you want figures that are going to be subjected to the scrutiny and discussion of other stakeholders who are outside the company, they must be audited first. We are not sure whether these figures have been cooked up, or even about the value of the assets. So the information I wanted to give the hon. Member holding the Floor is that in reference to these figures, I think you are labouring in vain.

MR BANYENZAKI: Thank you for giving way and thank you, Madam Speaker. The information I want to give the House and specifically my colleague hon. Bahati is that actually all these audited figures you are asking about- in the last Parliament we were in a committee that investigated the Tri-Star saga. We investigated all these issues and got submissions from the chairman or the top boss of Uganda Development Bank. Even people from Bank of Uganda came and testified to these figures. These figures are factual.

In our last Parliament and in that report specifically, we advised Government to pull out of this saga of Tri-Star but they refused. They did not take our recommendation. We undertook an audit on the owners of Tri-Star and found that their names were tainted. We even went as far as undertaking an audit on their companies in Sri Lanka and we found that that company was a sham.

The whole thing was a sham and the report that was presented to this House recommended that Government goes in and takes over ownership of the assets of Tri-Star before the government of Uganda loses the money. Therefore, taking into consideration the fact that this Parliament carried out an investigation and it is within the records of the Parliament of Uganda, we should not dispense the figures that have been given in there.

MR LUKWAGO: I thank you for the information given. Madam Speaker, one thing that is clearly is that we are not looking for concocted figures. At least we know how much has been injected in Tri-Star and that is what we were looking for. We are not looking for concocted figures.

Finally, Madam Speaker, on page 7 about the benefits of Government, No.1 states that: “The company has provided skills and employment to over 3,500 people in the making of garments. These are all part of the team of committed and educated workers, which is a contribution to the transformation of society”.

Madam Speaker, I will take you to page 10, in relation to the same. By the time it scaled down its activities Tri-Star had employed almost 1,500 people. Presently about 490 workers or 30 percent are working on textile orders. Where is the rest of that workforce? Hon. Minister, can you tell us where these people whom we trained at our own expense are?

There is a proposal that Tri-Star be buried. I agree with that proposal only that it should not be buried with our assets. We should recover our money from Tri-Star before it is buried. I thank you very much.

6.49

MR GAUDIOSO TINDAMANYIRE (NRM, Bunyaruguru County, Bushenyi): Madam Speaker, after having heard all sides, I wish to move a motion under Rule 46 of our Rules of Procedure that the debate be closed; the statement be rejected by this House and the affairs of Tri-Star be investigated by a select committee; the report be brought to Parliament and the culprits be held personally responsible -(Applause)- I beg to move.

THE DEPUTY SPEAKER: Is it seconded?

MS BOONA: Thank you very much, Madam Speaker. I would like to add an amendment concerning t the investor from Libya. If he wants to invest in the cotton industry, the Uganda Government need not be committed. He can, like any other investor come and use his capital, knowledge, wisdom and experience. We would be happy if he revamps the cotton industry in this country. Thank you very much, Madam Speaker.

MR KATURAMU: Thank you, Madam Speaker. The consensus seems to be that the country lost on this venture and since it has been alluded to this House that a lease offer was granted, I would like to bring in an amendment that the lease offer be cancelled immediately as we fight to recover the other lost assets. Thank you.

THE DEPUTY SPEAKER: Honourable members, why don’t we pass the resolution and then detail out the steps to be taken in the committee? Isn’t that better?

MR OKOT OGONG: Madam Speaker, this matter is not new. It is as old as the Seventh Parliament. This matter was brought before this Parliament and a select committee was instituted. A report was produced and recommendations that were very pertinent were made. However, all that went to waste. Government never respected the recommendations of this Parliament and continued to release money to this company.

Government continued to have dealings with Kananathan, whom to me is a fake person, and Kananathan has direct access to the state. How are we going to gain by putting in place today, another select committee? We are going to be ignored. They are going to continue releasing money and the Libyans will continue to get our money from Bank of Uganda. This is a line where people are siphoning the hard-earned money of this country. We should come up with a more serious recommendation of this Parliament. I want to propose –(Applause)

I want to call upon the young people of this nation to cry for our country; our country is bleeding to the bone marrow. We must stand up firm to this country and make a statement to this nation that we must liberate our country from looters -(Applause)- And this Parliament has the opportunity to make a point that we do away with looters.

We are Ugandans and we are not looters. At this Parliament I can see reasonable members. We must unanimously condemn, in the strongest terms, those who released our money to Kananathan. That is the way forward -(Applause)- we must put it today that Kananathan and his people and accomplices, must be brought to book -(Applause)

Our giant factory- this building is about 11 storeys- is now idle. We must recover our factory. Uganda Revenue Authority lacks offices and while they are collecting money, more is being dished out. We must give that office to Uganda Revenue Authority.

Madam Speaker, we are supposed to decide, but I am telling you, as Members of Parliament, we have a role to play. Our role is to defend our country as well as to ensure good governance in our country. There are people who do not believe in law, but as members of Parliament, we must believe in good governance and in development. My people in Dokolo, -(Interjection)

MR DOMBO: Madam Speaker, I want to thank the honourable member for his submission. However, a motion has been moved and it has been seconded. Whereas I agree with the magnitude of the feelings of the members about the haemorrhage that is happening to our resources as depicted in the report of the hon. Minister, I do also agree that in order to enable the Parliament make a substantive decision, we need vital and important information.

Whereas the Seventh Parliament carried out an investigation, there is a lot that happened since that time that is not reflected in this report of the Seventh Parliament. There are also many members of Parliament in this Parliament who were not members of the Seventh Parliament and whose values and additions are very vital to enable us to proceed.

Whereas I agree with that, may I propose, in a simple point of procedure that we proceed to set up a select committee with terms of reference specifically provided by this Parliament? From the contributions of Members, I have already identified members who can really give information to that committee: Members like hon. Nyombi, hon. Okot and other members who are so vigilant and they have information and the technical ability to advise us, so that we make a fundamental conclusion.

Is it not procedurally right to proceed with a motion, which was moved on this Floor, for us to conclude this debate? The question is, isn’t it procedurally right for us to conclude that motion as amended to enable us set up a committee to investigate and report on this matter? I thank you.

MR EKANYA: Thank you very much, Madam Speaker. I beg to move that the question be put on the motion on the Floor

THE DEPUTY SPEAKER: As amended?

MR OKOT OGONG: What I am saying is very simple. That -(Interruption)

THE DEPUTY SPEAKER: But what you are saying does not conflict with what he is saying. What you are adding is that, before setting up the select committee you are condemning the acts, then after that the committee-

MR BANYENZAKI: Madam Speaker, I am amending the motion on the Floor that all proceedings of Government with Tri-star, as of now, be halted until Parliament pronounces itself after that report from the select committee.

MR KIBANZANGA: Thank you very much, Madam Speaker. As hon. Banyenzaki told us, this matter was investigated. What we have heard today is real looting of this estate. Unless we are running an “Enkoni state”, Kananathan and other directors of this company should first be arrested and thereafter, investigations can be carried out when they are behind bars. I have discovered that these investigations by Parliament sometimes are used to cool the tempers; the Executive does not follow sometimes even the recommendations of these reports. If this were not an “Enkoni state”, Kananathan and other directors would have been arrested by tomorrow.

MR ODONGA OTTO: Madam Speaker, I have been listening very keenly and I submit that this Parliament should not attempt to create a select committee because we are just going to add stenography to the Parliamentary archive. We shall bring a report here but we are not the implementing arm.

I had two suggestions, which I would beg MPs to consider. The first is that we commit the office of the Attorney-General to give us a legal status of the affairs of Tri-Star as of now - (Interruption)- That is my suggestion. I can also bring an amendment to the motion. Unless we have sober institutions that we can use, the moment we tie the Attorney-General’s hands to bring us the legal status of the issues surrounding Tri-Star, it may give Parliament a reasonable hand to delve into the issues of Tri-star.

The second suggestion is that the Parliamentary Committee on Legal and Parliamentary Affairs still has all the powers- (Interjection)

MR TANNA: Madam Speaker, I would like to seek your guidance. There is a motion on the Floor. The motion has been seconded and a motion for question has been put on the Floor. Is the honourable member procedurally right to continue to divert the debate?

THE DEPUTY SPEAKER: No. I think there is general consensus that we move as proposed by hon. Tindamanyire.

MR ODONGA OTTO: Madam Speaker, I want also to give my political opinion -(Laughter)- Yeah, it is very important for the record. You see in life the moment you see a witch doctor that claims he can bring back everything that has been stolen, reporting the theft of his phone to the police station, you know you are dealing with a fake witch doctor -(Laughter)-. Because, he should use all the powers that be to get back his mobile phone, other than running to the Police to report the theft of his phone.

I am suggesting that the recommendation made by hon. Banyenzaki can be the only solid decision that Parliament can make, that is, that no one further deals with Kananathan and Tri-star. That can be the only solid recommendation, so that tomorrow if any money is released from the treasury, we can hold people accountable. Otherwise, if we set up a Parliamentary select committee, believe you, after another three months -(Interjection)

MR GODI AKBAR: Thank you for giving way honourable member. Madam Speaker, the information I want to give to the honourable member is that these issues of the select committee will not work. This Parliament is on record. We unanimously agreed the other time that they should open NTV and nothing happened. The Executive sat on it with impunity even after a committee report. Today again we are saying that we should set up a select committee for the issue of Tri-Star. It will die another natural death.

The only thing that I see that is a bit right is that the honourable colleague has put the motion and it has been seconded. Many people are giving amendments. Let us proceed to and we see whether we can set a new precedent -(Interruption)

THE DEPUTY SPEAKER: But you have not changed anything.

MR ODONGA OTTO: Madam Speaker, lastly as I sit down, to me Kananathan and Tri-Star are guilty before we even put any charge on them. We do not even need to waste time with any committee. We want to caution them. If anyone is lured by the Minister of Finance and they go ahead to collect money contrary to these strong warnings from Parliament, we shall hold them responsible for siphoning Ugandan money with their proboscis –(Laughter)

THE DEPUTY SPEAKER: Honourable members, supposing we assigned our other standing or sessional committees with this responsibility so that they can report back if you do not want a select committee. Can we assign it to our committee?

MR KAWANGA: Madam Speaker, this is a very serious matter. I can understand the anger and feelings of everybody but we must move in an organised fashion. We have debated this issue, but then we have to document and be able to present it in a manner, which is presentable to any authority that can look at it. We can only do that by some investigations and later report to this Parliament.

So, either we agree to go into a select committee or choose one of our sessional committees, and give it terms of reference and a timeframe within which to report back. It appears most of the information is available, including the report of the Seventh Parliament. With that we can then come back and take a position, which can be accepted by everybody. Let us agree on a select committee. If we think that is not appropriate, let us go for one of the sessional committees and the matter can be handled that way.

MR MUKITALE: Thank you so much, Madam Speaker. I agree with the submission of hon. Kawanga. But I am only concerned as we try to fight the haemorrhage, which is affecting us by Government supporting investors, are there no other projects where Government is supporting investors? Isn’t it time, Madam Speaker, that we review our privatisation plan and instead of Government supporting investors, Government should own the investment and look for management contracts so that we stop this loss of resources and assets? I need your guidance, Madam Speaker.

THE DEPUTY SPEAKER: That one is a bit complicated if this is a private company. I do not know under what committee we said it. It is not a state enterprise. Honourable members, do we go for a select committee, or do we assign one of our committees in the ordinary course of its business?

MS ALASO: Madam Speaker, my impression from the debate that has been going on is that you need to source a lot of expertise and interest in this matter. I believe that is why the Rules give you the liberty to use your discretionary powers to set up a select committee, which would not get bogged down by usual committee work; they would only focus on this.

Madam Speaker, I had procedural concern. The motion has been on the floor a long time. It has been amended, isn’t it about time we disposed of that motion and then we can look into the terms of reference much later?

7.08

MR KIVEJINJA: I would beg the Members to give me their ears -(Interjection)

MR EKANYA: Madam Speaker, I respect elder, honourable Member of Parliament, hon. Kirunda Kivejinja, whom I met down there for the first time in 1998 when I was campaigning. He told me, “You want to become an MP? Who is your father in the circle of UPC?” I respected him very much from that time on –(Laughter)- Is it in order, Madam Speaker, for this House to listen to hon. Kivejinja, the minister who has defied Parliamentary resolutions twice? Is he in order? – (Applause)

MR DOMBO: Madam Speaker, I want to appeal to my colleagues that when we read the Rules of Procedure let us apply them. I want to move a procedural question –(Interjection)- I beg my members to listen.

The procedural issue I want to raise is that I do not want us to put the Office of the Speaker and the Chair to this Parliament into a controversy if an order is moved where there is a breach of Rules of Procedure or breach of courtesy within the House. If the honourable member feels that hon. Kivejinja should not be heard, let him move a substantive motion so that we put the Office of the Speaker out of the controversy because the Rules are very clear. If he should not be heard, move a point of procedure so that he is not heard and we proceed.

THE DEPUTY SPEAKER: Honourable members, I want to put the question. I put the question that this House adopt the proposed resolution by hon. Godi.

(Question put and agreed to.)

THE DEPUTY SPEAKER: Honourable members, we shall deal with the composition of the committee at the next meeting, and we shall also work on the terms of reference.

Honourable members, just some announcements, we did say that we would inform you about the burial of hon. Dr Bulamu. Today the body will spend the night at his home in Mukono. Those who are not able to travel to Busoga on Saturday could go and visit. Tomorrow, they will have prayers at 10 o’clock in the morning at his home in Mukono. The body will leave for Busoga at 3p.m.

On Saturday there will be prayers at 10 o’clock at Kiyunga Church of Uganda. Burial is expected to be at 2p.m. at Bulike village off the Iganga-Kamuli Road, Kiyunga Primary School. His home in Mukono is next to Seroma High School. It is not too far from the main road. Honourable members, I want to thank you very much. House adjourned to tomorrow at 2 p.m.

(The House rose at 7.12 p.m. and adjourned until Thursday, 19 April 2007 at 2.00 p.m.)