State House bought the building that has housed State House operations for decades from Standard Chartered Bank at sh10.3b in April last year.

Nakyobe requested Parliament to write off a sh590m audit query involving soldiers

The State House comptroller, Lucy Nakyobe, has explained how the State House acquired Okello House from its long-term landlord, Alexander Okello.

State House bought the building that has housed State House operations for decades from Standard Chartered Bank at sh10.3b in April last year.

According to Nakyobe, “Okello was duped by some individuals. He wanted money and was told that if he allowed them to use his title, they would help him secure a loan. They paid him $300,000 (sh1.1b) in exchange for the land title”. “They got the money and bought buses (Pioneer Easy Bus) that used to ply Kampala routes and park at Namboole.

They had calculated that they would use the buses to make money and payback, but URA (Uganda Revenue Authority) zeroed in on them demanding some taxes and KCCA (Kampala Capital City Authority) denied them routes.

So, the bank had to sell the building,” she added. Nakyobe, who was appearing before the public accounts committee (PAC) yesterday to answer audit queries from 2018/19, was tasked by the chairperson, Nandala Mafabi, with explaining where State House did not bail out Okello.

“He has been your good landlord and a Ugandan, you could have paid the bank so that he pays you back in turn in due course,” Mafabi said.

However, Nakyobe responded: “Then we would be here responding to a query on why we bailed him out and continue being his tenant.”

“We had put a caveat on Okello House, otherwise the building could have gone a long time ago. One time he got into trouble with South Sudanese but it is the caveat that saved the building so he went to the President and reported that we were barring him from doing business and we were ordered to lift the caveat,” she said.

Nakyobe added: “We had been rescuing him on several occasions. He would go to the President and asked to be paid in advance, but I think this time, he thought it had become an easy way and he sought help elsewhere.”

Parliament last year approved a sh10b supplementary budget to buy the property after Standard Chartered put Okello House up for sale following the owner’s failure to sufficiently service loan obligations to the tune of sh20b.

Okello, under his holding company Moyo Hardware, was also the proprietor of Amamu House, which he has since lost to Barclays Bank.

Nakyobe said State House acquired the building, which is adjacent to State House in Nakasero, through a bid process in which they were given the opportunity to take over at the stated price of sh10b.

Media reports indicate that Okello got the loan to help start Pioneer Easy Bus on the understanding that he becomes the director and his children get a stake in the transport company, but was pushed out.

SH590M QUERY

Meanwhile, Nakyobe also requested Parliament to write off a sh590m audit query in which Uganda People’s Defence Forces soldiers were indicted for stealing the money from the State House cash stores.

The committee learnt that the unidentified officers, who made off with the money in 2011, have since been prosecuted before courts of law.

However, the query continues to appear on the State House financial statements because the money has never been recovered.

She narrated that after breaking into the stores, the soldiers abandoned their guns and uniforms at the cash office.

Nakyobe requested that Parliament writes off the query because those implicated in the loss have since been sentenced to 20 years’ imprisonment.

“They were arrested with cash exhibits of between sh30m and sh50m and charged in the court-martial where they were given 20- year jail sentences.

“They appealed on grounds that it was a harsh punishment, but the query continues to be placed on us. We request that it is written off,” Nakyobe said.

Mafabi agreed with Nakyobe and asked her to write to the Accountant General and the Secretary to the Treasury, requesting for a write-off and bring the request to Parliament for consideration.