The National Water and Sewerage Corporation (NWSC) is seeking UGX 650 billion (about USD 176 million) to boost water production and distribution capacity across 50 urban centers nationwide.
The capital intervention will relieve heavy strain on utility networks where average capacity utilization has hit 85 percent.
Under the proposed financial structure, the government will provide UGX 500 billion as a concessionary loan at a 2 percent annual interest rate.
The loan features a two-year grace period and a 20-year repayment window.
NWSC will service the loan entirely from its operational revenues.
The state will provide an additional UGX 150 billion as a direct revenue grant.
The Ministry of Finance will disburse the funds in five annual installments of UGX 130 billion between the 2027/28 and 2031/32 financial years.
The Minister of Water and Environment, Gen. Kahinda Otafiire, endorsed the expansion project during his maiden visit to the NWSC International Resource Centre in Bugolobi.
Gen. Otafiire instructed the utility to pursue long-term infrastructure planning covering at least two decades.
“In Africa we have intelligent people with poor management skills,” Gen. Otafiire said, urging the board to retain and motivate skilled personnel.
He pledged government assistance to establish domestic assembly plants for water meters, pipes, and related inputs to insulate the utility from global supply chain shocks.
Addressing whistle-blower reports, Gen. Otafiire observed that “a moving car will always raise dust” and noted that constructive criticism serves as “a mirror that helps us do better.”
NWSC Managing Director, Dr Silver Mugisha, presented the 50 Towns Water Supply Improvement Project to the minister.
The project allocates UGX 202 billion across 14 towns in the Central region, UGX 178 billion to 14 towns in the Eastern region, UGX 90 billion to eight towns in the Northern region, and UGX 180 billion across 14 towns in the Western and South-Western regions.
Individual town allocations range from UGX 10 billion for smaller centers to UGX 30 billion for major networks like Gomba and Tororo.
The capital works will focus on water extraction plants, electro-mechanical gear, transmission mains, storage reservoirs, and digital quality monitoring systems.
NWSC will execute the works using in-house design and direct engineering supervision.
The corporation will package contracts into technical and regional lots while procuring heavy machinery directly from original manufacturers.
Dr Mugisha disclosed that the utility currently faces an overall investment financing gap of UGX 1.436 trillion.
NWSC operations have expanded from 23 towns in 2013 to 293 towns as of June 30, 2026, serving over 22 million consumers with annual turnover rising to UGX 680 billion.
Dr Mugisha appealed for government support to transition water pumping stations to solar power and establish domestic production of water treatment chemicals.
NWSC Board Chairman, Prof. Henry Alinaitwe, confirmed that internal audit reviews into recent whistle-blower allegations affirmed the financial viability and cost-saving performance of corporate subsidiaries.
Representing the Permanent Secretary, John Mary Vianne Twinomujuni affirmed that the Ministry of Water and Environment will guide the corporation through statutory approval channels to roll out the project smoothly.
