The government has reduced the buyout amount for electricity distributor UMEME from $190 million to $118 million following a special audit report by the Auditor General.
Parliament adopted the revised figure during a plenary session on Thursday, 27 March 2025, after the report confirmed UMEME’s actual investment. The Minister of State for Finance, Planning, and Economic Development (General Duties), Henry Musasizi, tabled the report.
Deputy Speaker Thomas Tayebwa urged the government to consider the audit findings when finalizing the buyout. “This morning, the Auditor General submitted a special audit report, verifying and confirming the buyout amount of $118 million against the approved $190 million,” he said.
Tayebwa also emphasized the urgency of settling the matter before 31 March 2025 to avoid penalties. “If we do not settle, UMEME will have a blank cheque to determine penalties and interests,” he warned.
On 20 March 2025, Parliament had approved a government loan request of $190 million from Stanbic Bank to finance the buyout, pending verification by the Auditor General.
Geofrey Ekanya (MP, Tororo North County) supported the Deputy Speaker’s position, citing practices in Tanzania, Kenya, and South Africa, where governments act on special audit reports without waiting for parliamentary approval. “Special audit reports have issues of a criminal nature, but this report is also time-bound. We request that the Speaker invokes the necessary rules so that when Parliament takes a decision, it is within our Rules,” he said.
UMEME’s Exit from Uganda
UMEME’s 20-year electricity distribution concession in Uganda, which began in 2005, is set to expire on 31 March 2025. In 2022, the government announced it would not renew the contract, opting instead to transfer electricity distribution to the Uganda Electricity Distribution Company Limited (UEDCL). The decision was part of broader reforms aimed at reducing electricity costs and improving service delivery.
As part of the agreement, the government is required to compensate UMEME for its verified investments made during the concession period. The Auditor General’s special audit was conducted to determine the exact buyout amount before the transition.
With the concession nearing its end, the government has emphasized a smooth handover to UEDCL to avoid disruptions in electricity distribution across the country.
