The oversight report by Members of Parliament highlights red flags over the utilization of more than 260BN taxpayers money which government pumped into Roko Construction Company, with legislators raising concerns over accountability of the funds.
The concerns follows an incident on Monday when a delegation of some Members of the Shadow Cabinet led by the Leader of the Opposition Joel Ssenyonyi visited the Roko Construction Company Head office but were denied access to the premises.
The report released today highlights the “glaring concerns” about financial transparency by Roko, delayed projects under execution by the company, and governance reforms which legislators say need to be urgently addressed.
Privately owned by Germans; Mann Fransey Koehler (12,000 shares) Fried Helm Erwin Jost (1500) and Kurt Walter Blaetler (1500 shares), Roko Construction Company Ltd has a long history in the undertaking of major infrastructure projects including government buildings, roads, and other key facilities, but has faced financial difficulties in recent years, prompting the Government of Uganda to intervene with bailouts amounting to 263.33BN.
The aspect for the government bailout was to facilitate completion of Government Projects as Roko was involved in several strategic government projects, including: the completion of the Parliament building; Cancer Institute in Mulago; Ministry of Finance building among others. The government’s stake would ensure these projects continue without delay, as a collapse of Roko would led to delayed completion of these projects.
Another aspect was protection of Jobs to prevent massive layoffs and the potential economic ripple effects since Roko claims it employs over 1,800 Ugandans directly, and has indirect business relationships with thousands of others, including subcontractors and suppliers.
According to the report by the LOP, to date, some of the infrastructure projects that were fronted as a reason for approval of the investment have not been completed including the Parliamentary Chambers, IGG House, among others. The LOP further claims that staff of the company regularly reach out to legislators complaining about not receiving salaries for close to four (04) months, raising a concern if Government is aware of the employees’ plight.
“Government construction projects have continued to stall despite the 2022/23 bailout, and this raises a lot of questions. Most notable of these projects is the Parliamentary Chambers, whose target completion date was July 2021, but to date not much progress is seen.” LOP Joel Ssenyonyi states in the report.
“Government ought to appraise Parliament on the latest financial standing of the company. Given that Government approached Parliament with a bail-out request, the house deserves to be given accountability of the bail-out money. Did the financial status of the company improve?” Ssenyonyi queried
with a demand for the Attorney General to lay before Parliament the Share Agreement with Roko providing clarity on it’s current shareholding which he says is unclear.
“It is not known as to whether amendments were made to include GoU investment and how much GoU owns in equity. Government ought to provide an explanation to this effect.” He noted.
Speaking to the press outside Roko Construction Head Office located in Kawempe Tuula zone on Monday 14th October 2024, Ssenyonyi said the objective of the oversight visit was to ascertain whether the rationale of the bailout was being achieved but also to establish if the governance and management challenges of Roko Construction were addressed.
In a letter, the Managing Director, Mark Khoeler said that the Board of Roko had rejected the planned engagement between legislators and the company’s management.