Road Sector Programme Support

THE REPUBLIC OF UGANDA

OFFICE OF THE AUDITOR GENERAL

ANNUAL REPORT OF THE AUDITOR GENERAL FOR THE YEAR ENDED 30TH JUNE 2008

VOLUME 5

VALUE FOR MONEY AUDITS

TABLE OF CONTENTS Page LIST OF ABBREVIATIONS ……………….………………………………………………….… iii 1.0 OVERVIEW ………………….…….…………………………………………………….. 1 1.1 Mandate ……………………………………………………………………………………………….…….. 1 1.2 Vision ……………………………………………………………………………………………………….... 2 1.3 Scope of Auditor Generals Work in Relation to VFM Audits …………………………….… 2 1.4 Performance of VFM Unit ……………………………………………………………………………… 4 2.0 NATIONAL AGRICULTURAL AND ADVISORY SERVICES PROGRAMME ….. 7 ADVISORY AND INFORMATION SERVICES COMPONENT 2.1 Background …….………………………………………………………………………………………….. 7 2.2 Findings ………………………………………………………………………………………………….….. 10 2.3 Conclusions …………………………………………………………………………………………….….. 17 2.4 Recommendations ……………………………………………………………………………………..… 19 3.0 DISTRIBUTION OF WATER TO URBAN AREAS BY NATIONAL ……………... 23 WATER AND SEWERAGE CORPORATION 3.1 Introduction …………………………………………………………………………………………….…. 23 3.2 Findings …………………………………………………………………………………………………….. 26 3.3 Conclusions ………………………………………………………………………………………………… 39 3.4 Recommendations …………………………………………………………………………………….…. 40 4.0 IMPLEMENTATION OF NORTHWEST SMALLHOLDER AGRICULTURAL …... 43 DEVELOPMENT PROJECT (NSADP) - MINISTRY OF AGRICULTURE ANIMAL INDUSTRY AND FISHERIES 4.1 Introduction ……………………………………………………………………………………………..…. 43 4.2 Findings ……………………………………………………………………………………………………... 47 4.3 Conclusions ……………………………………………………………………………………………….… 60 4.4 Recommendations ……………………………………………………………………………………….. 61 5.0 PREVENTION AND CONTROL OF LIVESTOCK DISEASES BY THE ………..… 64 DEPARTMENT OF LIVESTOCK HEALTH AND ENTOMOLOGY IN THE MINISTRY OF AGRICULTURE ANIMAL INDUSTRY AND FISHERIES 5.1 Introduction ………………………………………………………………………………………………... 64 5.2 Findings ………………………………………………………………………………………………….…. 69 5.3 Conclusions …………………………………………………………………………………………………. 91 5.4 Recommendations ……………………………………………………………………………………….. 94

6.0 PROVISION OF WATER AND MAINTENANCE OF WATER FACILITIES 98 IN DISTRICT LOCAL GOVERNMENTS BY THE DIRECTORATE OF WATER DEVELOPMENT, MINISTRY OF WATER AND ENVIRONMENT 6.1 Introduction ….……………………………………………………………………………………………. 98 6.2 Findings ………….………………………………………………………………………………………….. 101 6.3 Conclusions …………………………………………………………………………………………….…… 111 6.4 Recommendations ………………………………………………………………………………………… 111 7.0 UGANDA AIDS CONTROL PROJECT ………………………………………………. 114 7.1 Introduction ………………………………………………………………………………………………… 114 7.2 Findings ………………………………………………………………………………………………………. 118 7.3 Conclusions …………………………………………………………………………………………………. 130 7.4 Recommendations ……………………………………………………………………………………….. 131 8.0 MANAGEMENT OF HEALTH PROGRAMMES IN THE HEALTH ……………….. 133 SECTOR MINISTRY OF HEALTH 8.1 Introduction …………………………………………………………………………………………………. 133 8.2 Findings ………………………………………………………………………………………………………. 137 8.3 Conclusions …………………………………………………………………………………………………. 169 8.4 Recommendations ……………………………………………………………………………………….. 172 9.0 UNIVERSAL PRIMARY EDUCATION PROGRAMME ……………………………. 176 9.1 Introduction ………………………………………………………………………………………………… 176 9.2 School Facilities Grant ………………………………………………………………………………….. 182 9.3 Funds Flow and Management of Capitation Grant …………………………………………… 206 9.4 SFG: Technical Appraisal Review …………………………………………………………………… 215 GLOSSARY OF TERMS …………………………………………………………………………. 226

LIST OF ABBREVIATIONS

ACP Animal Check Point ADB African Development Bank. ADF African Development Fund AFROSAI-E African Organization of Supreme Audit Institutions (English speaking) AG Auditor General AHG Animal Holding Ground AHO Animal Husbandry Officer AI Avian Influenza AIDS Acquired Immune Deficiency Syndrome ANC Ante Natal Care/Ante Natal Clinic AQN Audit Question AQS Animal Quarantine Station ARDC Agriculture Research Development Center ARRIS Animal Resources Research Information system ASC Assessment Criteria ASF African Swine Fever AWPB Annual Work Plan and Budget AWPBs Annual Work Plan and Budgets BEMOC Basic Emergency Obstetric Care bn Billion BOU Bank of Uganda BP Blood Pressure CAO Chief Administrative Officer CAOs Chief Administrative Officers CBMS Community Based Maintenance System CBO Community Based Organization CBPP Contagious Bovine Pleuro pneumonia CCPP Contagious Caprine Pleuro pneumonia CDD Control of Diarrhea Diseases CEMOC Comprehensive Emergency Obstetric Care CFO Chief Finance officer CG Capitation Grants

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CHOGM Commonwealth Heads of Governments Meeting CIA Chief Internal Auditor CITES Convention on International Trade in Endangered Species of Wild Fauna and Flora COCTU Coordinating Office for the Control of Trypanosomiasis in Uganda CSO Civil Society Organisation DANIDA Danish International Development Agency. DDHS District Director of Health Services DDP District Development Plan. DDSP District Development Support Programme DE District Entomologist DEO District Education Officer DFID Department for International Development DFIs District Farm Institutes DIM District Implementation Manual. DLG District Local Government. DPCs District Project Coordinators DSC District Service Commission DTACs District Technical Advisory Committees DTB District Tender Board DVO District Veterinary Officer DWD Directorate of Water Development DWO District Water Officer. DWSCG District Water and Sanitation Conditional Grant. EAC East African Community ECF East Coast Fever EMOC Emergency Obstetric Care ESIP Education Strategic Investment Programme EU European Union FAO Food and Agriculture Organization FBO Faith Based Organizations. FB-PNFP Facility Based Private Not for Profit FDS Fiscal Decentralization System FEWs Field Extension Workers FH Fire Hydrant

FITCA Farming in Tsetse Control Areas of East Africa FMD Foot and Mouth Disease FMS Fixed Monitoring Sites FTD Flies per Trap per day FY Financial Year GDP Gross Domestic Product GoU Government of Uganda HBMF Home Based Management of Fever HCs Health Centers HIPC Highly Indebted Poor Countries HIV Human Immunodeficiency Virus HMIS Health Management Information System HPM Hand Pump Mechanic. HSC Health Service Commission HSD Health Sub District HSSP Health Sector Strategic Plan IDA International Development Association IDAMC Internally Delegated Area Management Contract IDP Internally Displaced People IEC Information, Education and Counseling IFMS Integrated Financial Management System IMCI Integrated Management of Childhood Illnesses IMF International Monetary Fund IMR Infant Mortality Rate INTOSAI International Organisation of Supreme Audit Institutions ISO International Standards Organisation IT Information Technology ITNs Insect Treated Nets IWA International Water Association JRM Joint Review Missions LC Local council LCA Local Currency Account LG Local Government LGDP Local Government Development Programme LSD Lumpy Skin Disease

M&E Monitoring and Evaluation MAAIF Ministry of Agriculture Animal Industry and Fisheries MDG Millennium Development Goals MMR Maternal Mortality Rate MOD Ministry of Defence MOE Ministry Of Energy MoES Ministry of Education and Sports MOFA Ministry of Foreign Affairs MoFPED Ministry of Finance, Planning and Economic Development MOGLSD Ministry of Gender, Labour and Social Development. MOH Ministry of Health MOJCA Ministry of Justice and Constitution Affairs MoLG Ministry of Local Government MOPS Ministry Of Public Service MoU Memorandum of Understanding MoWE Ministry of Water and Environment MoWHC Ministry of Works, Housing and Communications MSCL Micro Finance Support Centre Limited NF Non-Functional NAA National Audit Act NAADS National Agricultural Advisory Services NAGRC&DB National Animal Genetic Resource Centre and Data Bank NALIRRI National Animal Livestock Resources Research Institute NARO National Agriculture Research Organisation NCD New Castle Disease NDA National Drug Authority NGO’s Non-Governmental Organisations NHP National Health Policy NLPIP National Livestock Productivity Improvement Project NMS National Medical Stores NPA National Planning Authority NPC National Project Coordinator NPCU National Project Coordination Unit NPSC National Project Steering Committee NRW Non-Revenue Water

NSADP North-West Smallholders Agricultural Development Project NSR National Stock Routes NUSAF Northern Uganda Social Action Fund NWSC National Water and Sewerage Corporations O&M Operation and Maintenance. OAG Office of the Auditor General OIE World Organization for Animal Health OOP Office of the President. OPD Outpatients Department ORT Oral Rehydration Therapy PA Project Accountant PACE Pan African Program for the Control of Epizootics PAF Poverty Action Fund PAP Possible Audit Problem PATTEC Pan African Tsetse and Trypanosomiasis Eradication Campaign PE Project Engineer PEAP Poverty Eradication Action Plan PFAA Public Finance and Accountability Act PHC Public Health Care PMA Plan for Modernization of Agriculture PMTCT Prevention of Mother to Child Transmission PPDA Public Procurement and Disposal of Public Assets PPR Peste des Petits Ruminats PRA Participatory Rural Appraisal PS Permanent Secretary PVI Principal Veterinary Inspector PVO Principal Veterinary Officer QMS Quality Management System RDC Resident District Commissioner RH Reproductive Health RPV Rinderpest Virus RVF Rift Valley Fever RWSS Rural water Supply and Sanitation. SA Special Account SACCOS Savings and Credit Cooperative Societies

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SAI Supreme Audit Institutions SC Statutory Corporations SFG School Facilitation Grant Shs Shillings SMC School Management Committee SMS Subject Matter Specialist SVI Senior Veterinary Inspector SVO Senior Veterinary Officer SWAP Sector Wide Approach TA Technical Advisor TAD Trans-boundary Animal Diseases TBA Traditional Birth Attendant TBD Tick Borne Diseases ToT Training of Trainers TSU Technical Support Unit. UA Unit of Account (ADF) UBOS Uganda Bureau of Statistics UCB Uganda Commercial Bank UCDA Uganda Coffee Development Authority Ug. Shs Uganda Shillings UIA Uganda Investment Authority UMHCP Uganda Minimum Heath Care Package UN United Nations UNBS Uganda National Bureau of Standards UNCS&T Uganda National Council for Science and Technology UNDP United Nations Development Programme UNFA Uganda National Farmers Association UNICEF United Nations International Children’s Emergency Fund UPE Universal Primary Education UPHOLD Uganda Programme for Human and Holistic Development URA Uganda Revenue Authority US $ United States Dollar USAID United States Agency for International Development UVA Uganda Veterinary Association UVB Uganda Veterinary Board

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UVRI Uganda Virus Research Institute UWA Uganda Wildlife Authority VFM Value for Money VO Veterinary Officer WHO World Health Organization WUC Water User Committee. www World wide web

1.0 OVERVIEW

This is Volume 5 of the Auditor General’s annual report to Parliament. It contains summarised reports of nine Value for Money (VFM) audit detailing findings, conclusions and recommendations made for each of the VFM studies. The full reports are available upon request form the Office of the Auditor General.

1.1 MANDATE

The 1995 Constitution of the Republic of Uganda and the National Audit Act, 2008 require the Auditor General to undertake Financial and Value for Money Audits and report to Parliament as set below:

The Constitutional provisions are as follows: -

1.1.1 Article 163 (3) of the Constitution requires the Auditor General to:

(a) Audit and report on the public accounts of Uganda and of all public offices including the courts, the central and local government administrations, universities and public institutions of like nature, and any public corporation or other bodies or organizations established by an Act of Parliament; and

(b) Conduct Financial and value for money audits in respect of any project involving public funds.

1.1.2 Under Article 163 (4) the Auditor General is required to submit to Parliament annually a report of the accounts audited by him or her or under clause (3) of this article.

1.1.3 The National Audit Act, 2008 (NAA)

The NAA, under section 21, gives powers to the Auditor General to carry out Value for Money audits for purposes of establishing economy, efficiency and effectiveness of the operations of any department or ministry, local government councils and any Public organization.

1.2 VISION

The vision of the office of the Auditor General is “To be an Effective and Efficient Supreme Audit Institution (SAI) in promoting public Accountability in the use of Resources in the enhancement of good governance”.

1.2.1 Mission

The mission of the office of the Auditor General is “To audit and report to the Public and there by make an effective contribution in improving public accountability”.

1.2.2 Core Values

The office of the Auditor General is run on three (3) specific core values which motivate and guide staff in their endeavours to achieve the vision and mission of the office. These core values are:- • Integrity • Objectivity and • Professional Competence

1.3 SCOPE OF AUDITOR GENERAL’S WORK IN RELATION TO VFM AUDITS.

1.3.1 The Audit

A VFM audit is an examination which provides an objective and constructive assessment of the extent to which the audited body has used its resources in carrying out its responsibilities with

due regard to economy, efficiency and effectiveness. VFM audits endeavor to evaluate if activities, programmes or projects involving public funds in ministries, departments, local government councils and any public organizations have been managed with respect to those criteria of economy, efficiency and effectiveness and the extent to which they might have not been met. In precise terms economy, efficiency and effectiveness can be defined as follows:-

• Economy- Minimizing the cost of resources used for an activity, having regard to the appropriate quality • Efficiency- The relationship between the outputs, in terms of goods, services and results, and the resources used to produce them • Effectiveness- The extent to which objectives are achieved and the relationship between the intended impact and the actual impact of an activity.

Value for Money audits are conducted in accordance with International Organization of Supreme Audit Institutions (INTOSAI) standards. Those standards require that a performance audit should be planned, conducted and reported on in a manner, which ensures that an audit of high quality is carried out in an economic, efficient and effective way and in a timely manner.

In carrying out such an audit, the auditor takes an in-depth look at the way a particular Ministry, Project or Public Institution has planned the task undertaken and whether good management practices and sound judgment were applied.

A VFM audit attempts to determine if the initial objectives set at the beginning of an undertaking were achieved. As a consequence of that, it is deduced as to whether due regard for efficiency, effectiveness and economy is present and recommendations for improvement are made in those areas where it is felt that deficiencies have occurred.

1.3.2 Reporting Period:

Financial audits refer to a fixed reporting period and attract an annual certificate of “fitness” on those Financial Statements. Value for Money Audits are not necessarily time bound or defined and do not attract a certificate as part of the report. The VFM reports have therefore been tailored to the statutory reporting time frame of the OAG which is 9 months after the financial

year end, being 31st March. This Volume 5 therefore refers to VFM reports which pertain to the period up to 31st March 2009.

1.4 PERFORMANCE OF THE VFM UNIT

1.4.1 Background

VFM auditing was initially introduced in the OAG on a pilot basis in 1998 under the OAG 2000 project which was funded by DFID. Thereafter the Office of the Auditor General (OAG) received further support of US $1,500,000 on a 3 year program spanning from 2005 to 2008. The program was sponsored by the Royal Norwegian Embassy and the African Development Bank (ADB) who financed field operations during audits and training of staff totalling to US $600,000 and US $900,000 respectively. The Government of Uganda elevated the VFM Unit to a programme in the 2008/2009 financial year with funding totalling Ug. Shs.622,000,000. This is expected to increase in 2009/10.

1.4.2 Completed Audits

The experience gained under the initial OAG 2000 project and subsequent training by Consultants from AFROSAI-E, has enabled the office to build capacity in carrying out Value for Money audits as reflected by the cumulative completed audits of the office as listed below:-

i. National Agriculture Advisory Services Programme (NAADS), ii. Distribution of Water to Urban Areas, iii. Implementation of Northwest Smallholders’ Agricultural Development Project (NSADP), iv. Prevention and Control of Livestock Diseases, v. Provision of Water and Maintenance of Water Facilities in District Local Governments, vi. Uganda Aids Control Project, vii. Management of Health Programmes in the Health Sector, viii. Universal Primary Education Programme and ix. Engineering Audit of CHOGM activities1

1 This audit was contracted out and not directly undertaken by staff of OAG. Details of the report are contained in Volume 2 – (Central Government).

1.4.3 VFM Audits under progress

A total of a further twelve (12) VFM audits have been initiated by the VFM unit and are at different stages of execution. They are planned to be completed and a report submitted to Parliament in the following year. They are:-

i. Garbage Collection in Kampala City Council, ii. Rural Roads Maintenance, iii. National Planning Authority, iv. Northern Uganda Social Action Fund (NUSAF), v. Passport production time by the Passport Control Office, vi. Management of Prison Services, vii. Management of Pension, viii. Inspection of Schools, ix. Debt Management, x. Distribution of Relief Items by the Office of the Prime Minister, xi. Regulation and Enforcement of Standards by Uganda National Bureau of Standards (UNBS) and xii. Distribution of drugs by National Medical Stores (NMS).

1.4.4 Training

A total of fifty (50) OAG staff have completed specialist training in conducting VFM audits under a program funded by Development Partners as mentioned in Paragraph 1.4.1. The office has planned to carry out more training of the VFM staff in other areas such as data collection methods and analysis, Training of Trainers (ToT) course and use of the OAG VFM Audit Manual to enhance their performance.

In addition to training, the office plans to carry out stakeholders’ awareness campaigns. The campaigns will target staff of OAG who undertake other types of audits, Members of Parliament, Donors, Councillors of Local Governments, Accounting Officers, media groups, Civic Society and other Government officials.

1.4.5 Future Developments

The VFM Unit is proposing to undertake the following strategic activities to improve its performance:- a) Transforming the VFM unit into a fully fledged Directorate, b) Strengthening the new Directorate by Identifying trained staff to fill the vacant positions, b) Creating an effective training unit, c) Establishing manpower planning procedures, d) Establishing effective quality assurance review mechanisms, e) Moving VFM processes onto an IT Platform.

2.0 NATIONAL AGRICULTURAL AND ADVISORY SERVICES (NAADS) PROGRAMME: ADVISORY AND INFORMATION SERVICES COMPONENT – (ISSUED NOVEMBER 2008)

2.1 BACKGROUND

2.1.1 Introduction

The National Agricultural Advisory Services (NAADS) Programme is a Government project which specifically undertakes new approaches to Agriculture extension delivery conceived under the Plan for Modernization of Agriculture (PMA) to redress shortcomings and incorporate best practice features to make Agriculture extension delivery systems more efficient and effective. It was designed taking in account with Government policies of decentralization, liberalization, privatization, empowerment of the people in decision making for development processes, and increasing public sector coordination and accountability. This study has been undertaken to assess the efficiency and effectiveness of the Agricultural Advisory Services.

2.1.2 Motivation The national economy of Uganda has been growing at an average of 5% per annum for the last decade while the monetary sector has grown by 9%. However Uganda’s population remains largely poor with GDP per capita averaging US$ 330, with up to 40% of the people living in absolute poverty. The rural poor have not benefited from the economic growth and remain outside the monetary economy mainly producing for subsistence.

Food crop production still accounts for at least 65% of agriculture GDP and agriculture continues to be characterized by low productivity despite the Governments response to these challenges in 1997 by way of Poverty Eradication Action Plan (PEAP), whose main goal is to raise small holder farm incomes. Under the PEAP, government directed funds from the debt relief from the donor community under the Highly Indebted Poor Countries (HIPC) initiative estimated at US$ 650 million through a special fund, the Poverty Action Fund (PAF) to social development particularly rural transformation and modernization of agriculture to cover a period of 25 years. The Plan for Modernization of Agriculture (PMA) which falls under PEAP provides a framework for coordinated implementation of agriculture reform from subsistence

farming to commercially oriented production. NAADS is a core programme of PMA and is designed to contribute to the realization of the agricultural sector objectives.

Between July 2001 and June 2006, a total of US$ 107 million was spent on agricultural activities by the NAADS Programme. However agricultural productivity remains low despite the interventions. The low productivity has been attributed to poor advisory and information services, poor technology development and linkages with markets, Lack of quality assurance regulations and technical auditing of services, lack of private sector institutional development and poor programme management and monitoring.

There have been complaints and press reports about poor quality of Advisory services, poor tendering process, lack of monitoring, political interference and lack of quality reports from the districts.

2.1.3 Design of the Study

Scope and Limitations This study focused on the advisory services component of the National Agricultural Advisory Services (NAADS) Programme.

The study covered the period of five years from July 2001 when project activities commenced to June 2006 and eleven districts were stratifically and randomly selected. The selected districts were, Kamuli, Mbale, Nakapiripirit, Hoima, Iganga, Lira, Wakiso, Nakasongola, Arua, Kitgum, and Tororo.

2.1.4 Audit Objective

The audit aims at assessing the factors that have affected the effectiveness of the NAADS advisory services as well as the impact on the intended goals of the programme.

2.1.5 Methodology We used well tested, integrated methodology where we worked closely with the programme staff, and solicited substantial input and observations from farmers and policy makers. The methodology is built on inter-relating records, observations, each necessary for valid studies.

We used observations and interviews to verify records. Records and interviews were used to verify observations and interviews. Each group of people was an important part of the process.

2.1.6 Description of the Audit Area Reducing poverty is an urgent priority for the Government of Uganda with the target of reducing the number of people below the poverty line to fewer than 10% by 2017. The overall framework guiding these intentions is the Poverty Eradication Action Plan (PEAP), whose goal is the social transformation of Uganda through a multi-sectoral approach that includes raising the incomes of small holder farmers. Under PEAP, the Plan for Modernization of agriculture (PMA) provides a framework for coordinated implementation of agricultural sector reforms aimed at the transformation of smallholder agriculture from subsistence farming to commercially oriented production.

One of the core programes under PMA is the National Agricultural Advisory Services (NAADS). NAADS is designed to be a decentralized, farmer owned and private sector- serviced extension system contributing to the realization of the agricultural sector objectives. It was created by an Act of Parliament in 2001 to specifically address constraints of access to agricultural information, knowledge and improved technology among rural poor farmers in the country. The programme began in 6 districts and 24 sub-counties in 2001 but has since expanded to 49 districts and 344 sub counties benefiting about 393,000 farm households directly by 2005/2006 financial year.

NAADS invests in :- • Developing farmer capacity to demand and manage advisory services, • Developing farmer knowledge and skills, • Developing farmer institutions, • Capacity enhancement of the private sector, • Increasing farmer access to technologies especially foundation technologies, • Developing information, communication and marketing systems for farmers and • Participatory planning, monitoring and evaluation of service delivery.

2.1.8 Activities To achieve the above objectives NAADS carries out the following activities: • Provision of advice and information services to farmers, • Supports technology and linkages to farmers, • Monitor and ensure the quality appropriateness and affordability of advisory services, • Support private sector and farmer institutional development, • Provide Program management, monitoring and • Ensure that research and extension needs of farmers are identified and answered by the service providers.

2.1.9 Financing The NAADS programme is funded by the Government of Uganda and seven donors who deposit money in a “basket” These funds are deposited on an account in Bank of Uganda before they are transferred into the consolidated fund. The seven donors are: • The World Bank International Development Agency (IDA), • The European Union (EU), • The Netherlands, • Department for International Development (DFID), • Development Cooperation Ireland (DCI), • The International Fund for Agricultural Development (IFAD) and • DANIDA.

2.2 FINDINGS This chapter presents finding of the study. The findings relate to the following aspects: disbursement of funds, matching funds, identification and prioritization of enterprises, technology development sites, quality of advisory services, reporting, farmer attendance at trainings, monitoring and supervision.

2.2.1 Timeliness of funds flow Funds are disbursed from MOFPED by telegraphic transfer to the General funds account in the districts. Transfer of funds to recipient districts is supposed to be made once every quarter in the first month of the quarter.

However, it was noted that most disbursements to the Districts sampled delayed for up to two months on average. From the district, funds are transferred to sub-county accounts. Clearance and approval are obtained from offices of the CAO and internal auditor. If all these officials are available the process could take 2-3 days, otherwise delays sometimes exceed two weeks.

Poor planning that does not take into consideration administrative bureaucracy within the programme and the Ministry of Finance and Planning have contributed to the delays in disbursement of funds to recipients.

Delayed disbursements have in some instances resulted in planned activities not being implemented in time. For example it was noted that sometimes the funds are received and farmers are trained after the planting time this denies them the opportunity to practice what they have learnt The seeds that are procured after the planting season do not benefit the farmers as they cannot utilize them immediately, and sometimes they end up getting spoilt before the next planting season due to lack of or poor storage facilities. The planting season also occupies the farmers, leaving them with no time to attend trainings hence reducing the attendance at trainings.

2.2.2 Matching funds from Districts/Sub county and farmers The MOU between GOU and the participating partners provide for the various beneficiaries to make contributions of matching funds. Districts are expected to contribute 5%, sub counties 5% and farmers 2% of the budget allocations. The contributions are considered as part and parcel of the annual budgets for implementing LG’s. Failure to comply with the requirements is supposed to lead to suspension of release of funds to the Districts/sub- county in question.

At the time of audit in 2007, the contribution from districts, sub counties and farmers was 20%, 30%, and 50% respectively of what they are supposed to have contributed. Whereas some districts like Arua had contributed 100%, districts like Nakapiripirit had contributed 0%. Substantial portion of funding is provided by the programme but farmer groups and sub counties still find it difficult to make their contributions. The audit also noted that most farmers are small scale, and resource constrained people who are involved in subsistence

farming and depend solely on crops for their livelihood and are unable to save. The programme aims at empowering farmers to improve their livelihood, yet the same farmers are asked to contribute towards the cost.

The audit also noted that farmers are always willing to contribute even though with difficulty if they are expecting technology development, however it also takes long for them to come up with the required funds. The inability of the farmers and sub counties to come up with their contribution in good time is affecting the timely implementation of programme activities.

2.2.3 Identification and prioritization of Enterprises According to NAADS revised implementation guidelines, chapter 3.4 para 3 selection of potentially profitable farming enterprises by farmers through their groups, is the starting point for advisory service provision under NAADS. The underlying hypothesis being that the use of productivity enhancing technologies and appropriate advice in farming activities, whose products have a ready market, will make farming profitable and create opportunities for increased household incomes. Farmers will continue to invest in such technologies if they are profitable, and lead to income generation, and capital accumulation.

The preliminary identification of enterprises is done by farmer groups who propose the enterprises they believe is suitable for them. This is done with the assistance of contracted NGO’s. The 3 prioritized enterprises are then ranked with the others from the other parishes from which the best 3 are selected for the sub county.

However the programme does not provide information on the market availability for the various crops. This has led to farmer groups selecting enterprises which had succeeded in neighbouring areas in the previous seasons. This has also resulted in most farmers in areas that are close to each other growing the same crops, leading to over production of some crops that end up not being bought or whose prices go down because of excess supply.

For example in Arua district in the year 2006 most farmers selected groundnuts without adequate market information. This resulted in overproduction of groundnuts which could not be sold, this discouraged farmers from growing groundnuts, and from the programme

activities as well. All the farmers interviewed agreed that they usually choose their enterprises based on information they get from other farmers within the village and in the surrounding areas.

In addition to selecting enterprises without ready market farmers in some areas tend to select the same enterprises year after year. This results in funds being spent on training in the same enterprises year after year. This leads to waste of funds. Training in same enterprises year after year discourages farmers from attending trainings as they get bored learning the same things every year. Growing crops that have minimal market opportunities is discouraging farmers from participating in programme’s activities and the funds so far invested risk being wasted if the advisory services provided are not practiced. Under NAADS, the transformation of subsistence farming, through market orientation, to commercial agriculture and the management of farming as a business is emphasized.

2.2.4 Technology Development Sites

According to the revised NAADS implementation manual chapter 5.8.1, the TDS belongs to the farmer group participating in the technology development. The farmer group is supposed to form a technology development committee to over see the management of the site. A farmer to have overall responsibility for the day today management of the site is identified and specific terms for his responsibility clearly spelt out.

In all the sites visited the committees were not in place. The day today management of the site is left in the hands of the host farmer. Allocating roles to the farmers is difficult and, and as a result the sites are not maintained. 58%.of the sites visited were bushy and hence were not serve the purpose for which they were established to serving as demonstration gardens. According to the implementation manual para 5.4, demonstrations are supposed to create farmer awareness and demand for a previously unknown technology. With demonstration sites that are not cared for the programme risks failing to meet its objective of creating awareness and demand for “unknown technology”.

2.2.5 Quality of Advisory services, end user satisfaction

The factor aimed at finding out if farmers are happy with the advisory services. It was entirely dependent on the response of the people.

According to the NAADS implementation manual annex 2.5viia service providers should have relevant academic qualifications, relevant expertise to accomplish the TOR and experience of individual expertise in the relevant area. In all the districts the service providers meet the minimum qualifications but in districts like Nakapiripirit the service providers did not have any experience in the areas where they were providing advisory services. The minimum qualification of a service provider is the possession of at least a Diploma in agriculture or agriculture related field.

According to the NAADS act 2001 section 24 (4) the farmers who are the recipients of the services of the service providers shall have a duty to assess the quality of service provided by a service provider while the technical audit of the quality of service provider shall be carried out by the relevant technical department at the sub county and District.

However 68% of the 600 farmers interviewed were not satisfied with the trainings. They claimed the trainers did not have experience in what they were training, that the training take long sometimes lasting about three hours of theoretical work and that, no reference materials were availed to the farmers to refer to later. Only 32% of the farmers interviewed expressed satisfaction with the farmers trainings. Although all the advisory service providers meet the minimum requirements, they are not meeting the user satisfaction in terms of quality. There was no evidence to show that the programme was undertaking any quality analyses.

2.2.6 Reporting

It is requirement of the programme implementation manual annex 2.5 iii Chapter 3 and 5 that service providers write reports which address the terms of reference after the farmer trainings.

However the quality of reports submitted by service providers varied across the districts, with districts like Arua having reports that were clear and addressing all terms of reference, while Nakapiripirit had the worst reports that were not addressing the terms of reference.

The reports did not contain vital information concerning the advisory services and as a result verification of some of the work done was rather difficult. This shows that the sub county and district coordinators were not reading the reports before sanctioning payments to service providers.

This affects future planning as the reports cannot be used to ascertain the extent of coverage and the set backs in the trainings cannot be used in the design of future training. Without clearly written reports, it becomes difficult to assess and establish the output of the advisory services.

2.2.7 Farmer attendance at trainings All farmers in groups that have been registered for a particular training are supposed to attend trainings conducted by private service providers.

We noted that farmer attendance at trainings is on average 37.1%. Farmers interviewed indicated that they miss trainings because, sometimes the trainings conflict with their work schedules. Farmer attendance is lowest when training takes place during the ploughing and planting seasons and highest during field visits. As a matter of fact attendance during field visits is on average 100%. This implies that farmers are more interested in practical training compared to class trainings.

Low farmer attendance means that the programme is losing money paid to train a given number of farmers, and yet only about 37.1% attend. Efficiency aims at minimum resources input with optimum utilization of the service providers in order to achieve value for money. The number of farmers who attend training represents the percentage efficiency, given that the same resources could have been used to train more farmers. The efficiency also confirms the fact that 62.9% of the resources were wasted, since only an efficiency ratio of 37.1% was achieved. The programme also risks failing to achieve its objective of training farmers in modern farming skills.

2.2.8 Monitoring and supervision

The Project implementation manual requires that subject matter specialist and district internal auditors monitor programme activities at least once a quarter. In all the districts visited, monitoring is done quarterly and reports submitted to CAO. However, monitoring by internal auditors is still weak because some internal auditors combine monitoring of programme activities with other district monitoring and combine the reports.

No standard internal audit verification reports have been designed to aid the internal auditors in their work and to help them come up with reports that can be useful for decision making. There is no verifiable indicator to show that monitoring and supervision were carried out. Reports produced are based on their own observations and verbal reports from those who carry out the monitoring and supervision. The monitoring by internal auditors concentrates on financial accountabilities without the review of the actual implementation of activities in the field; internal audit reviews do not add value in ensuring service delivery.

2.2.9 Achievements

2.2.9.1 Farmer groups

The programme took on a pro active stance as regards using farmer groups as service delivery avenues by employing NGO’s to help farmers form farmer groups. We noted that the group approach eased the provision of services and reached out to a big number of farmers. In addition some farmers were selected as group mobilizers to help in the mobilization and follow up on the training to ensure that farmers practice what they are taught and clarify where farmers do not understand.

2.2.9.2 Planning

The programme adopted a bottom up planning approach, where the farmers through their groups within their respective villages prioritized enterprises which were re prioritized at the sub county level and consolidated into sub county work plans and later reviewed and

consolidated into the district work plans. At national level, the programme carries out annual joint planning meetings to guide the implementation of programme activities and after approval; funds are disbursed by MoFPED for programme implementation on a quarterly basis. Discussion with farmers and district leaders revealed that the programme planning process was participatory and informative.

2.2.9.3 Monitoring

The programme has a monitoring plan and strategy to guide the overall monitoring function during programme implementation. The programme also holds annual review meetings in which the annual programme progress is reviewed, implementation gaps identified, solutions generated and up coming issues prioritized.

At the district level teams of subject matter specialists, district and sub county coordinators and internal auditors monitor programme activities quarterly, while farmer monitoring is regularly carried out by local leaders and farmer mobilizers.

2.3 CONCLUSION

2.3.1. Timeliness of funds flow It is evident that the delay in disbursement of funds has greatly affected the implementation of programme activities. Funds are received late thus affecting the training of farmers and management of technology development sites.

2.3.2 Matching funds from Districts/Sub county and farmers Although the programme releases all the funds that it is supposed to disburse, to implementing districts, some districts and sub counties have not been able to meet their obligation under the programme. Some farmers groups have not been enthusiastic about co funding while others just cannot afford. Interestingly, farmers are always willing to co-fund if they are expecting benefits in form of new technology. This suggests that the farmers have not yet appreciated the importance of advisory services.

2.3.3 Identification and prioritization of Enterprises The programme has not empowered farmers to select enterprises that have ready market. So many farmers in areas like Kitgum are involved in growing sorghum which has a very low price and limited uses. The resources used to grow sorghum could have been used to grow higher value crops if the farmers were well informed about the prices and markets for the different crops.

2.3.4 Technology Development sites It is clear that technology sites are not serving the purpose they were intended to serve. The programme has not been adequately monitoring the sites to ensure that they are in good order and to encourage farmers to put them to good use. New ways of dealing with the sites need to be devised.

2.3.5 Quality of Advisory services, end user satisfaction The quality of advisory services in many areas is very low. Very little effort has been put in by the programme to use service providers who can do a good job. Monitoring by the district subject matter specialists takes place once a quarter and sometimes after the training has taken place. Most farmers expressed dissatisfaction with the quality of training. The reports written by service providers just like the quality of service are wanting. Many of them do not show the work done, the strength and weaknesses. This means the reports are not used in improving the implementation of the programme.

The NAADS programme was designed on the premise that government extension staff would be restructured and laid off. They are supposed to have formed the core team to provide private advisory services given their qualifications and experience in extension services. However to to-date the Government has not laid off the staff. This resulted in the programme using the few qualified and experienced service providers to carry out the work. This has left so many districts with qualified but inexperienced service providers resulting in poor quality services hence wide spread complaints from the farmers. This certainly affected the programmes ability to achieve its objective of increasing agricultural productivity. The inexperienced service providers should have been trained in provision of extension services before being deployed and the monitoring teams should have closely followed them up to ensure quality service delivery.

2.3.6 Farmer attendance at trainings The farmer attendance at trainings is very low. The programme has not made efforts to address this problem and yet it greatly affects the programme outcome as it may not be able to achieve its intended objective of modernizing and commercializing agriculture in the country.

2.4 RECOMMENDATIONS

2.4.1 Timeliness: The process of disbursing funds to the implementers needs to be reviewed to avoid any delays and where possible administrative bureaucracy should be relaxed. The Programme should look at the possibility of releasing funds according to seasons rather than quarterly based on the financial year. This would ensure that funds are received just in time for the activities to take place.

According to NAADS management, all NAADS stakeholders have been pressing for programme funds to be released twice based on the agricultural seasons of the country. Some progress has been made in this direction. NAADS secretariat will also issue a circular to all CAO’s in the participating districts to ensure timely release/transfer of programme funds.

2.4.2 Monitoring and Supervision.

The programme should develop checklists for use during monitoring and supervision and the district should develop a performance indicator to show and confirm that monitoring took place. The supervision tool should have a provision for a third party confirmation of the supervision and field visits such as LC I office. This should provide an additional control to deter fictitious field visits. The work of internal auditors should be extended to the review of the actual implementation of activities in the field to clearly assess value for money.

According to management, NAADS is undertaking regional training workshops for district internal auditors, accountants and sub county NAADS coordinators (SNCs) on financial guidelines to address not only this issue but also other financial and accountability issues.

The internal Audit Department at NAADS secretariat has also designed an internal audit report template to be distributed to all districts. The template will guide the district auditors on what to look out for when undertaking quarterly audits. It will also ensure that comprehensive reports are filed with NAADS secretariat to enable management get informed of the operations of the NAADS programme in the district.

NAADS needs to put emphasis on disseminating information through practical and well looked after demonstration gardens that serve as a good examples to the farmers. The programme should also collaborate with Agricultural Research Institutions that can advise on the most recent technologies and how the technology sites can be effectively put to use.

2.4.3 Matching Funds from Districts/Sub-County and Farmers. There is need to ensure that the local Governments budget for programme activities. The districts that are reluctant to co-fund should be penalized. The programme should also come up with a programme of assisting poor and vulnerable farmers who cannot afford to co-fund programme activities. Farmers through their existing farmers groups should be encouraged to form saving and cooperative societies (SACCO’) that can assist them to save and are at hand to provide credit to the farmers when they need funding.

Management has indicated that, NAADS secretariat has introduced the rewards and sanctions strategy that is meant to reward good performing districts while taking sanctions on those not performing. Contributions to the programme are key performance indicator. Management has also resolved that while the 1st and 2nd quarter releases can be made to the districts without conditions, release of 3rd quarter funds will be dependent on districts having met at least three quarters of their contribution.

2.4.4 Identification and prioritisation of Enterprises.

Farmers should be provided with well researched information to guide them in selecting enterprises that have ready market. The programme should also strengthen and consolidate the farmers groups to undertake marketing and processing. The programme should lobby

and link the farmers to other organizations which can set up ware houses and storage facilities for easy bulking.

According to management the programme is involved in a number of efforts together with other agencies to generate, collate and disseminate market information to farmers. The partnership strategy being vigorously promoted is meant to link the NAADS farmers to the market. Under the new NAADS, Agro processing is emphasized as a means of value addition. Reasonable resources have been provided by the programme in this area.

2.4.5 Technology Development Sites.

The programme should come up with lead farmers to house technology development sites and be responsible for their maintenance and the benefits accruing there from. The lead farmers should be people who can explain to other farmers about a new technology. They should also be acceptable to majority of the farmers.

The Secretariat has promised that, through the Districts shall ensure that capacity of farmer groups to plan and identify TDSs and their maximum utilization is built. Service providers shall be held accountable if no knowledge dissemination is undertaken at the TDSs.

2.4.6 Quality of Advisory Services. The programme should make experience a condition for one to provide advisory services. They should also identify good service providers and black list poor performers. The programme should also provide some training in extension services. The programme should also put to use the district extension service staff. The district extension service staff are more qualified and experienced than the private service providers, they can be facilitated to carry out extension services where quality service providers cannot be readily available.

According to management, quality of service is of concern to NAADS and a number of strategies are being used to address this. These include: a. Utilization of public extension workers under the New NAADS, b. Utilization of Community Based Facilitatators (CBO) to ensure continuity of service,

c. The New NAADS include strategy to enhance farmer satisfaction through usage of demonstration farmers, lead farmers, model farmers, and Nucleus farmers, d. The subject matter specialists based at the districts should ensure that technical audit is undertaken.

2.4.7 Reporting. The programme should come up with a standard format of writing advisory service progress reports. Well written reports should be availed to the sub county programme coordinator before the service providers are paid and it should strictly be enforced.

According to management, the programme has a component of training service providers. The training has however delayed because of the slow pace of registering service providers, and identification of training needs of service providers. NAADS however, will identify all training needs of the service providers, which certainly includes reporting and include them in the training curriculum. The Programme is also in touch with the faculty of agriculture, Makerere University to make an input in the curriculum.

2.4.8 Farmer Attendance at Trainings. The programme should ensure sure that all trainings are carried out at the time that is acceptable to the farmers. It should also come up with a training manual that emphasizes practical training and less of theoretical classroom teaching. Training should also be carried out when the planting season is just about to start so that farmers can practice what they have learnt and can get clarifications from the service providers when they are still available. There should be provision for follow ups after the trainings by service providers.

Management has promised that, the Programme will ensure that in future, service providers and extension workers make training programmes in consultation with farmers, and agree on timing, venue, topics and other relevant areas of concern for farmers in as far as they are consistent with the terms of reference given to the service providers.

3.0 DISTRIBUTION OF WATER TO URBAN AREAS BY NATIONAL WATER AND SEWERAGE CORPORATION – (ISSUED FEBRUARY 2009)

3.1 INTRODUCTION

3.1.1 Background to the Audit: This Value for Money audit on the Distribution of Water to Urban areas in Uganda by the National Water and Sewerage Corporation (NWSC) has been conducted in accordance with Article 163(3) of the Constitution of the Republic of Uganda. This mandate was amplified under Section 21(1) of the National Audit Act 2008 which requires the Auditor-General to carry out value for money audits for purposes of establishing economy, efficiency and effectiveness in the operations of any department or ministry.

3.1.2 Motivation: The study was motivated by public concern about provision of clean water to the urban population in Uganda as highlighted in media reports and the general public outcry. There is a high concentration of people living in urban areas who do not have access to clean water.

Supply of clean drinking water is estimated to have risen from an average of 54% in 20022 to

70% in 20063 against the national set target of 100% by the year 2000 in urban areas4.

Provision of safe drinking water is one of the millennium development goals adopted by the UN member countries in 2000. The Government of Uganda has made the water sector one of the priority areas of its development strategy (PEAP) because safe and clean water is considered to be a major factor in social economic development. Providing water services to the informal urban poor settlements is a major objective of National Water and Sewerage Corporation (NWSC).

2 NWSC Corporate Plan 2003 - 2006 page x

3 NWSC Corporate Plan 2006 - 2009 page xi

4 National Water Policy 1999 page 15

The population in urban centres is currently growing at a faster rate than water supply in the major towns of Uganda. There has been an outcry from potential water customers who expect water services, while those already connected to the system spend long periods without water despite Government and development partners’ support to the Corporation’s development initiatives in providing water to the population. This audit was conducted to assess the operations of NWSC urban water distribution and provide possible recommendations that will improve the operations of NWSC in addressing the challenges undermining the urban water distribution system.

3.1.3 Description of the Audit Area: The Ministry of Water and Environment is responsible for the planning, management and provision of water and sanitation services in Uganda.

The two key agencies under the Ministry of Water and Environment which are responsible for the implementation of the water sector activities are the National Water and Sewerage Corporation, which is responsible for the Large Urban Centres, and the Directorate of Water Development (DWD) which provides water to small towns and the rural centres.

NWSC is an autonomous public corporation while DWD is a department under the Ministry of Water and Environment.

At the national level, the MoWE is responsible for policy issues and political direction to the water sector in Uganda. The NWSC is mandated to provide water and sanitation services to urban centres.

3.1.4 Statutory Mandate: The National Water and Sewerage Corporation is a public Corporation wholly owned by Government. It was established by Decree No. 34 of 1972 to improve water and sanitation services in the major Urban centres of Uganda.

The NWSC Act, 1995 was enacted to give the corporation more autonomy to provide water services on a commercial and viable basis.

3.1.5 Major Activities: The principal business of the corporation as defined by the NWSC Act, 1995 is to operate and provide water and sewerage services to 19 urban areas of Kampala, Entebbe, Masaka, Mubende, Jinja/Njeru, Lugazi, Mbale, Tororo, Soroti, Lira, Gulu, Arua, Masindi, Hoima, Mbarara, Kabale, Bushenyi/Ishaka, Kasese, Fort-Portal. The major activities include:

• To manage the water resources in ways which are most beneficial to the people of Uganda, • To provide water supply services for domestic, stock, horticultural, industrial, commercial, recreational, environmental and other beneficial uses, • To provide sewerage services in an area in which it may be appointed to do so under the Act or the Water Act, to the extent and standards that may be determined by its corporate plan, any performance contract, and regulations made under the Act or the Water Act and • To develop the water and sewerage systems in urban centres and big national institutions throughout the country.

3.1.6 Financing: National Water and Sewerage Corporation is funded by internally generated revenue, Government of Uganda, and development partners who include the German Government, World Bank, European Union, French Government, Belgian Government and the Austrian Government.

The table below shows the different sources of funding over three years 2004/05 – 2006/07.

NWSC Source of funds 2004/05 to 2006/07: Financial 2004/05 2005/06 2006/07 Year/Source Shs (billion) Shs (billion) Shs (billion) Revenue: Internally Generated 52.44 57.98 69.16 GoU Funds 0.099 - - Donor Funds 1.25 0.56 1.24 Total Income 53.78 58.54 70.40 Source: NWSC Accounts Division

(Allocation of the above funds to different systems like distribution and production could not be easily identified).

3.1.7 Scope: This report covers Three and a half Years from July 2004 to December 2007. The focus of the audit is on water distribution in urban areas of Uganda by the National Water and Sewerage Corporation. The areas were selected to cover the Northern region towns of Arua and Gulu; Central region covering Kampala, Masaka and Mubende; Eastern region covering Soroti, Tororo, Jinja and Mbale; and Western region covering Masindi, Mbarara, Bushenyi and Kasese. Kampala area was selected because the main water plant and the NWSC headquarter are located there. For the other towns, a mixture of non-viable towns (Mubende and Masindi) and those operating fairly well were selected in order to create a balanced opinion.

3.1.8 Methodology: The audit was carried out in accordance with International Organisation of Supreme Audit Institutions (INTOSAI) Auditing Standards and guidelines. Those Standards require that the Performance Audit should be planned, conducted and reported on in a manner, which ensures that an audit of high quality is carried out in an economic, efficient and effective way and in a timely manner. In collecting data from the field, the team carried out interviews, reviewed documents and physical inspection/observation of the facilities.

3.2 FINDINGS

3.2.1 Leakages and bursts: Each area office of NWSC is required to set a minimum standard for addressing leaks and bursts as an operational indicator in accordance with IDAMC of each area ranging from 3 to 8 hours.

We noted that in different area offices, response time for addressing leaks and bursts on mains and service lines is at an average of 2 hours to 50 hours based on available data as shown in the graph below.

Time of Addressing Leaks and Bursts

Target Time 30 Actual Response Time Time (Hours) Time

0 Kasese Mbarara Bushenyi Masaka Mubende Kampala Area Office

Source: OAG analysis

While it takes on average 10 hours or less in areas like Kasese and Bushenyi, in bigger operational areas like Mbarara, Masaka and Kampala it takes on average 20 hours or more to rectify these faults.

The delays are mainly caused by shortage of repair materials like delays caused by the centralized procurement system and Area offices storing materials for addressing simple leakages while materials for major repairs would be requisitioned from headquarters. To mitigate this bottleneck, management of NWSC has now given the autonomy to areas to procure all repair materials under the IDAMC.

Buried valves also take long to excavate and in the process this increases water losses. Besides, locations of the valves are in many cases known to only few staff members. For performance efficiency, management is training area technical staff under the QMS [ISO certification programme], to improve on network operations and maintenance activities.

Water gushes out along Busega round-about FH on 21st January 2008 3:38pm.

These delays translate into huge amounts of water losses especially on the water mains which distribute substantial amounts at high pressure (like the picture above). NRW for all areas stood at an average of 35.6% as at 31st December 2007 while in Kampala area alone,

NRW was at an average of 42.45. This is considered high compared to 20% acceptable for developing countries and the Corporations target of 28.7%.

3.2.2 Rehabilitation of the distribution network: In execution of the routine maintenance/rehabilitation work, it is good practice that NWSC staff are guided by documented policies/procedures.

NWSC also has a policy which requires replacing the distribution network system ranging from 10 to 33 years6.

We noted that there is lack of clear policy/procedures to guide staff Corporation-wide in applying standard procedures to carry out maintenance and rehabilitation work.

5 NWSC Performance Reports

6 NWSC Corporate Plan July 2003 – June 2006 page 40

During the course of the audit however, NWSC management informed us that the manuals are being developed under the QMS (ISO certification for each area) and are in advanced stages of completion.

We also noted that part of the Corporation’s distribution network was installed more than 50 years ago. These systems have exceeded their economic life and are currently too small and inadequate to satisfy the ever increasing urban and peri-urban population in view of the high per capita water use. These assets are not being replaced after expiry of their economic/useful lives as per depreciation policies.

Key aspects of Asset management remain a responsibility of the headquarters. Area offices carry out rehabilitation work only after their budgets are approved by the head office.

The old pipe network receives water from sections of recently improved, new and expanded state of the art facilities with higher pressure.

The current Corporation’s Capital Development initiatives are mainly focusing on the construction and expansion of new water systems. There has been inadequate rehabilitation of the network and as a result there is a growing need for investment in maintenance and repairs which will ultimately require huge investments in future if the current practice persists.

NWSC Capital Development Projects for the period 2006-2009:

Project Name Amount Nature/type (bn Shs) Mukono Water and Sanitation Project 6.4 New Gulu Water and Sewerage Systems 9.0 New Gaba 1 Rehabilitation Project 9.9 Rehabilitation Entebbe Water Supply Project 40.5 New Kampala Sanitation Master plan 1.6 New Kampala Water Supply Network Rehabilitation 7.2 Rehabilitation Project Gaba III Project 31.2 New Kampala Urban Poor Project 0.4 New Kampala Peri-urban Project 4.0 New Kabale Additional Works Project 4.0 New Total 114.2 Source: NWSC Corporate Plan 2006-2009

From the above table, of the Shs 114.2bn earmarked for capital projects in the 3 year period, only Shs 17.1bn (9.9+7.2) was planned for rehabilitation works. Management also indicated that 6% of its operating budget is allocated for repair of assets in addition to annual provisions for depreciation.

The existing old facilities like outdated pipe network and old storage tanks have continued to deteriorate and are a major source of water losses contributing to the problem of overall NRW in the Corporation.

Failure to rehabilitate the old facilities has resulted into interruptions by some customers who experience low pressure since the amount of water received by the customers is determined by the size, age and type of the facility.

3.2.3 Payment/Collection of Water Bills (Arrears): When meter readings are taken by Commercial Division staff, bills are supposed to be generated and sent to customers within 2 weeks of the following month after billing7. In order to direct efforts towards collecting all bills, NWSC set a target collection/Billing ratio including arrears of 100%. Once bills are delivered, Area staff are required to continuously carry out door to door follow-up of payments from customers on a monthly basis.

With regard to, Government ministries and departments, a Memorandum of Understanding (MoU) signed between the Government (represented by the MoFPED) and NWSC to address arrears requires NWSC to furnish MoFPED and the Auditor-General with monthly and quarterly status reports, procurement of appropriate pre-paid metering technology, and take remedial measures for non-compliance.

It was established that collection takes a period of between 1 day to more than 3 years.

The audit also established that NWSC furnished MoFPED with quarterly reports since the signing of the MoU. However the money released was not sufficient to cover outstanding

7 NWSC Commercial Manual paragraph 6.5.1

Government arrears. This is attributed to under-provision for water bills by MoFPED in the annual budgets for the Ministries and the fact that MoFPED releases money quarterly, which releases do not sufficiently take care of actual billing and arrears.

The possibility of using pre-paid meters to reduce arrears by Government departments/Ministries had not been considered by NWSC at the time of audit. Management of NWSC was piloting pre-metering among the small income earning category (urban poor) in Kisenyi I, Kisenyi II and Ndeeba after which pre-paid metering shall be scaled up to include ministries. As a result, arrears for the Ministry category of customers have continued to accumulate from Shs 8.1bn in June 2005 to Shs 15.8bn in December 2007.

For other category of customers, NWSC hired debt collectors during the first half of FY2007/2008 to pursue customers who have failed to pay water bills, to complement efforts within the Corporation of collecting arrears.

In the areas visited, the study revealed that non-payment of the bills from other categories other than ministries was mainly attributed to low willingness to pay by customers.

The Corporation does not encourage the practice of disconnecting customers as a method of collecting/recovering outstanding debts. Follow-up of payment agreements, billing errors and the time taken to address these problems ultimately affect the customers in deciding when to settle water bills, usually after their concerns have been rectified. In the process, revenue is tied thus affecting cash-flow.

Delay in collecting payments has consequently increased the arrears portfolio from Shs 26 billion at 30th June 2005 to Shs 32.6bn as at 31st December, 2007. The status of arrears by different consumers as at 31st December 2007 is shown in the chart below.

NWSC Arrears by Category as at 31st December 2007 (bn Shs)

Embassies 0.02 {0.07%} Domestic 9.99 Ministries {30.61%} Parastatals Institutions Ministries 15.80 {48.4%} Commercial Local Authorities Local Authorities 0.27 {0.83%} Domestic Embassies Commercial 4.76 Parastatals {14.59%} 0.51 {1.56%} Institutions 1.29 {3.94%}

Source: OAG analysis.

Government ministries and domestic customers comprise about 80% representing Shs 26bn of the total Shs 32.6bn arrears. Ministries are bulk consumers and their payments depend on the amount and timing of releases from MoFPED. Domestic consumers on the other hand are many but aggregate amounts billed are substantial and follow-up can be challenging.

Consequently, the Corporation has lost money through writing-off bad debts to the tune of Shs 5bn over the last 3 financial years as shown in the table below.

NWSC Bad Debts Written-off - (2004/05 to 2006/07):

Item/Year 2004/05 2005/06 2006/07 Total (bn Shs) (bn Shs) (bn Shs) (bn Shs) Bad Debts written-off 1.51 1.38 2.13 5.03 Source: NWSC annual reports, 2004/05 to 2006/07.

3.2.4 Connecting new customers: NWSC staff are expected to connect new customers within a period of three days upon payment of a connection fee as specified in the NWSC charter.

We noted however that connecting new customers takes a period ranging from 4 days to 114 days. Details are shown in the graph below.

Average Time Taken to Connect New Customers

120

100

60 Average Time

40 Average TimeAverage

0 Mbarara Kasese Masaka Bushenyi Jinja Mubende Area Offices

Source: OAG Analysis

From the above graph, Areas like Kasese, Bushenyi and Mubende takes less than ten days to connect new customers. This is mainly because the towns are relatively smaller than Mbarara, Masaka and Jinja where the customer applications are relatively more.

The reasons advanced for the delays in connecting new customers through interviews and review of documents were lack of meters, delays in getting connection materials and delay of funds from head-office as well as difficulties in accessing or locating customer premises.

These delays deny the customers timely access to clean water. NWSC on the other hand loses revenue due to delayed new connections.

3.2.5 Stakeholder Coordination: The Water Act requires providers of water and sewerage services to provide their services in consultation with appropriate public authorities and relevant community groups. It is good

practice to involve relevant stakeholders in planning and implementation of service delivery to the urban population.

We noted that there was lack of coordination and understanding between the Corporation and various stakeholders like municipal/urban authorities, telecom companies, road contractors and individuals when laying infrastructure of different projects which require excavation work. Even Development Committees in Local Authorities that used to coordinate infrastructure development [roads, railways, water works, and telecom facilities] are currently non-functional.

This arises partly due to limited sensitization of stakeholders about the location of water infrastructure and access of premises during expansion of the distribution network.

Inadequate coordination is evidenced by delays in connecting new customers because of failure by the Corporation staff to access premises.

Above: A 6 inch pipe on the mains at Wairaka (Jinja-Iganga Road destroyed during road construction). Taken on 14th November, 2007 at 11:35am

The Corporations’ existing facilities have also been damaged by new excavations by other utility and service providers such as when road works, telecom and electricity cabling are taking place. The Corporation ultimately loses a lot of water when water mains are cut resulting into water shortages in urban areas like the example of Wairaka above.

The open points can expose the distribution network to contamination and cross- contamination with changing pressure levels, which ultimately affects the quality of the water.

Besides, the Corporation suffers road reinstatement costs, (shown in the table below) where the new pipe network crosses an existing road. With better coordination however, these costs could be shared with other stakeholders.

Road reinstatement costs for Kampala Area for the period 2004/05 – 2006/07 Financial Year Amount (Million Shs) 2004/05 144.4 2005/06 206.5 2006/07 162.2 Source: NWSC Finance and Accounts Division.

3.2.6 Access to water at fire hydrants: The Water Act requires NWSC to erect fire hydrants and standpipes for supply of water for extinguishing fires in convenient places and at distances that they consider appropriate and in an effective manner. The Act also requires them to provide services efficiently and economically. It is good practice that the department furnishes NWSC with accountability for the water used in extinguishing fires.

We noted that the Corporation has designated various points in different towns and Kampala city where the Police Fire Brigade can obtain water for fire fighting. The water consumed at fire hydrants is given to the police free of charge.

Through interviews, it was established that because of unlimited access, some of the water was being misused by the police, construction companies and private operators who access water from un-metered fire hydrants.

The Corporation has no mechanism in place to monitor the use of water for fire fighting purposes.

Misuse of water was caused by unlimited access to un-metered points by the police fire brigade and other illegal users and private water operators. In Kampala alone, 1751 fire hydrants exist but only 8 of these are metered, making it difficult to control the amount of water used at these locations.

This increases NRW which consequently denies genuine customers water services. The Corporation also loses revenue.

3.2.7 Supply of Water to Consumers: Areas with hilly terrain require the use of booster pumps, re-enforcing the mains and restructuring the pumping and distribution network to improve the distribution of water uphill in order to sustain a 24hour water supply.

NWSC has invested resources in extending infrastructure and pipe network in several areas up to individual homes which occupy a hilly terrain in various urban areas within the country. A number of customers in these areas either do not receive water at their premises or in some instances the pressure is so low that it takes long to receive meaningful quantities/volumes of water to satisfy an individuals’ domestic water requirements.

We noted for example, that in the suburbs of Kampala city like Kawempe, Nansana, Nabbingo-Buddo, Kalinabiri, Kulambiro, Kanyanya, Namugongo, Ntinda and Seeta-Mukono, residents take over 6 hours a day without water against NWSC target of 24hour supply. Consumers in these areas either take long periods without water or water supply is erratic, insufficient and unreliable.

Installation of boosters and bigger pipes for water distribution on the existing network has not been adequate in areas experiencing low pressure to meet the customer expectations.

Because of the inadequacies along the mains and the distribution network, long queues are evident at public standpipes, a clear manifestation of insufficient water supply within urban areas. People resort to use of alternative sources. Water in some of these sources is contaminated and not suitable for human consumption.

The infrastructure put in place in the process of expanding the networks remains underutilized because of the dry pipes besides attracting a lot of criticism and public outcry.

3.2.8 Non-Revenue Water (NRW): The International Water Association (IWA) has set an average of 20% as an acceptable level of NRW for developing countries.

The NWSC Corporate Plans 2003-2006 and 2006-2009 set targets of NRW (shown in the graphs below) as a percentage of water produced. The first graph shows the performance of NRW for all areas while the second graph highlights the performance of Kampala alone.

NWSC Target and Actual NRW for the period 2004/05 - 2007/08 [All Areas]

38 37 36 35 34 NRW Target All Areas 33 NRW Actual All Areas 32 31 Percentage of NRW 30 29 2004/05 2005/06 2006/07 2007/08 Financial Year

Source: [Figures for 2004/05-2006/07 were extracted from Annual reports and those of 2007/08 from Performance reports]

While NWSC achieved the set targets, the actual NRW performance is gradually increasing and by the end of December 2007, it had reached the level of the set standard.

For Kampala Area, the set targets were not being achieved for the period 2006/07 and 2007/08 as shown below.

NWSC Actual Target and Actual NRW for the period 2004/05 - 2007/08 [Kampala Area]

45 40 35 30 tage) 25 NRW Target for Kampala 20 NRW Actual for Kampala 15

NRW (Percen NRW 10 5 0 2004/05 2005/06 2006/07 2007/08 Financial Year

Source: [Figures for 2004/05-2006/07 were extracted from Annual reports and those of 2007/08 from Performance reports]

The amount of water lost through NRW is still high and exceeds IWA acceptable standards for developing countries.

The above losses are mainly caused by leakages and bursts, illegal connections, under- registering meters, water used for fire fighting, old distribution network and overload on service lines. This has resulted into loss of revenue to the Corporation and overall water shortage to consumers.

Positive steps taken to reduce NRW include the creation of an illegal use reduction unit in Kampala and conducting a study which revealed that an average of 20% losses occur due to meter under registration after two year of use.

3.3 CONCLUSIONS

From the audit findings above, the following conclusions were made to highlight opinions observed during the course of the audit.

3.3.1 Technical Aspects: NRW through leaks and bursts reduces the amount of water available for distribution to the final consumer, increases the problem of water scarcity in urban areas and loss of income to the Corporation. The time taken in long queues to collect water reduces the population quality time for productive work. Consumers spend highly as water prices from these alternative sources escalate affecting customers’ spending patterns and payment of water bills. The Corporation facilities are not adequately maintained, which further compounds the problem of leaks and bursts and increases water losses. Stakeholder coordination has been inadequate resulting in disruption of the distribution network, leading to poor service delivery, water losses and water scarcity in urban areas. The ability of NWSC to expand and provide water services to prospective customers is also impaired. Failure to put in place monitoring and accountability mechanisms of water use at fire hydrants increases the problem of NRW and loss of revenue to the Corporation.

3.3.2 Commercial Aspects: NWSC takes long to disconnect customers with overdue water bills. This has greatly increased the level of uncollected debts. While management has put in place possible methods of collecting arrears like direct debits, direct payment at financial institutions and other cash payment incentives, the amount tied in arrears still appears to be quite high compared to the financial needs and set targets of the Corporation. This growth in arrears impairs the ability of the Corporation to effectively expand the distribution network and curb water shortage due to the reduced cash-flow. It may also affect the long term financial sustainability of the company. Billing errors also translate into customer complaints and delayed payments which further increase the accumulation of arrears and bad debts.

Delay in connecting new customers ultimately leads to customer dissatisfaction in NWSC services. These delays may also affect the image of the Corporation.

3.4 RECOMMENDATIONS

After conducting the audit and in light of the findings and conclusions, we wish to make the following recommendations which are aimed at improving the deficiencies observed in the distribution of water in urban areas.

3.4.1 Improvement in Water Distribution (Technical Aspects): A map of all key points like valves should be availed to staff in charge of operations/maintenance to ease their work. Staff should be regularly inducted and trained to acquaint themselves with the locations of valves. Illegal Use Reduction service should be extended to all areas in country. Officers from area offices can be attached to the unit in Kampala to gain essential skills required in fighting illegal water use. Management of NWSC should regularly review the policies on maintenance and replacement of worn out assets and implementation of these policies should be adhered to. Rehabilitation of existing old infrastructure is vital in view of the water losses. The Corporation should balance the needs of undertaking new capital development projects with routine maintenance and rehabilitation of existing infrastructure taking into consideration other factors like the age of the pipe network and other facilities, soil type, pipe diameter and traffic load where the network is laid. Management should also ensure that the process of compiling the manuals is completed for a proper maintenance plan and clear operations procedures. Where appropriate NWSC should request prospective customers to obtain authority from neighbors when applying for new connection. Sensitization of existing and potential customers, local leaders, and landlords is vital in enhancing the distribution network and supply of water to the urban population. Measures aimed at improving stakeholder coordination at planning and implementation of NWSC development projects should be put in place to ensure that the roles of the various players are properly executed and expectations are met. In this regard, NWSC should play a leading role in steering coordination and liaising with urban authorities

and other stakeholders to ensure that a coordinated plan for all developments is discussed and understood by all players to minimize damages to the infrastructure. There should be proper coordination and improved relationship between NWSC and the Fire brigade to identify the location of the fire hydrants and assess their viability. A map of these points should be made and reviewed periodically to establish the appropriateness, adequacy and convenience in order to reduce misuse of water. A mechanism of recognizing private water operators using water at fire hydrants with an option of licensing them should be considered. Designated points for this purpose alone should be identified to enhance monitoring and revenue collection. The social/mandatory obligation of providing water for fire fighting should be streamlined without compromising the Corporation’s mandate of operating as a viable commercial enterprise in an effort to reduce overall NRW. NWSC should also put in place a reporting mechanism to ensure proper accountability of water consumed at fire hydrants. NWSC should develop a comprehensive master plan for both water and Sewerage Systems to enable it execute long-term capital development projects and distribution network. NWSC should prioritise re-enforcing of the mains and restructuring the pumping and distribution capacity of the network to improve on water distribution and curb the effects of low pressure. Enhancing education and incentive programs for customers to use water saving methods is essential in supplementing NWSC efforts of providing water to the urban population.

3.4.2 Improving Revenue Collection (Commercial Aspects): We recommend that the practice of contracting out collection of arrears to debt collectors be regularly reviewed and applied consistently countrywide in line with NWSC mandate, to reduce the high level of arrears. Efforts towards implementing the MoU between Government of Uganda and the Corporation should be strengthened to recover arrears from government ministries and departments. The Corporation should assess the benefit of acquiring pre-paid meters against the costs of bad debt write-off, engaging debt collectors and the time value of money, with a view of mapping a clear strategy to eliminate arrears.

It is also recommended that disconnection of defiant customers be re-enforced to recover arrears. There should be close supervision of commercial/Billing staff to minimize billing errors. Monitoring of set standards should be employed to assess performance.

4.0 IMPLEMENTATION OF NORTHWEST SMALLHOLDER AGRICULTURAL DEVELOPMENT PROJECT (NSADP) - MINISTRY OF AGRICULTURE ANIMAL INDUSTRY AND FISHERIES – (ISSUED MARCH 2009)

4.1 INTRODUCTION

4.1.1 Background Following the civil strife for two decades, many people in Northwestern Uganda went to exile in Congo and other neighboring countries. This resulted in decline of agricultural sector and break down in infrastructure. The region was declared by G.O.U to be lagging behind the national average economic growth indicators as characterized by high poverty levels, food insecurity and low household incomes. The economic growth indicators in the region at the inception of the project (1999/2000) are summarized in the table below:

Indicator North-West Region Uganda Infant mortality per 1000 140 122 Child mortality per 1000 235 203 Maternal mortality per 1000 500 505 Stunted children under 5 years (5%) 50 38.6 Source: Uganda Bureau of Statistics.

It is for this reason that G.O.U with the help of ADB designed NSADP to address the problems of high poverty levels, food insecurity, low household income and low agricultural productivity faced by the people in the region.

Northwest Smallholder Agricultural Development Project (NSADP) is a multi-sector five-year Project in MAAIF jointly funded by the African Development Fund (ADF) and Government of Uganda (GOU). The project started in January 2001 and was expected to end on 31 December 2005.

However, due to delayed implementation, the project life was extended by another three years ending 31 December 2008. The project was designed to train farmers in improved agricultural practices with a view of increasing their agricultural output. The increased agricultural output would give farmers enough food supply for their homes and the surplus sold in markets to generate household income.

The project also envisaged that in order for the farmers to practice improved agricultural methods, there was need to provide farmers with subsidized agricultural loans to enable them buy farm inputs such as hoes, pangas, improved seeds, chemicals and apply appropriate farming technology and meet other agricultural overhead costs.

The project further envisaged that with increased agricultural productivity farmers would need proper access to markets to sell the surplus output. It is from this background that the project also planned to develop the agricultural infrastructure in the region. A number of roads and bridges were selected for construction and rehabilitation to allow easy accessibility to constructed markets by farmers. District farm institutes (DFIs) were also to be constructed and others rehabilitated to help in the training of farmers.

4.1.2 Reasons for the Audit The Government’s efforts towards alleviating the high levels of poverty, low agricultural productivity and food insecurity in the region have yielded low results despite the intervention by the NSADP project. The audit sought to ascertain whether the loan utilization has been efficient in reducing poverty levels, increasing agricultural productivity and food security in the region. The audit also sought to make recommendations that would help management bring about improvements in project implementation.

4.1.3 Mandate Under the loan agreement, between Government of Uganda (GOU) and African Development Bank (ADB), the Ministry of Agriculture, Animal Industry and Fisheries (MAAIF) through NSADP was mandated to implement the project.

4.1.4 Project Activities The project activities can also be categorized under the following project components:

Production Enhancement Component i. Provide improved seeds and seed distribution system, ii. Introduce and operate animal traction teams for hire, iii. Fund 3-months short-term training expert on traction/draught power, iv. Provide effective extension service and training, v. Introduce and implement agro-forestry practices, vi. Training farmers in improved practices and vii. Strengthen capacity of staff at the district.

Rural Infrastructure Component i. Rehabilitate 200 kilometers of priority roads, ii. Routine manual maintenance of 1600 kilometers of community roads, iii. Recurrent maintenance of 1600 kilometers of community roads, iv. Periodic maintenance of 200 kilometers of priority roads, v. Construct and rehabilitate building structures at DFIs and vi. Improve water supply and sanitation in priority markets.

Micro Credit Component i. Establish a micro credit scheme and ii. Promote a micro credit scheme.

4.1.5 Project Funding

The Project is funded by a loan secured from ADB of UA 17,600,000 (US $24.146 million) or Shs.35.012 billion and G.O.U counter funding of UA 2,000,000 (US $2.743 million) or Shs.3.984 billion giving a total project amount of UA 19,600,000 (US $26.889 million) or shs.39.026 billion. At the time of the study a total UA 11,428,098 (US $17.051 million) or Shs.29.764 billion had been released by the Project.

Funds Released By ADB By Currency Categories Years 2001/ 2002/ 2003/ 2004/ 2005/ 2006/ 2007/ Total 2002 2003 2004 2005 2006 2007 2008 Currency: (UA) 378,523 814,869 639,551 481,050 1,760,355 1,980,432 5,373,318 11,428,098 Currency: (US $) 479,869 1,154,742 920,723 718,938 2,526,163 2,964,141 8,286,135 17,050,711 Currency: (UG.SHS)’000 821,175 2,111,578 1,729,388 1,222,103 4,315,505 5,063,642 14,500,736 29,764,127 Source: Compiled by OAG from Projects annual progress reports, cash books, bank statements Audited Financial Statements

4.1.6 Scope

The study was conducted on NSADP which is a project under the Ministry of Agriculture, Animal Industry and Fisheries (MAAIF). The study focused on three major components out of the five which included; Production Enhancement, Rural Infrastructure development and Micro Credit Components which form 69% of the total project funding (Production enhancement 22%, Rural Infrastructure 40% and Micro Credit 7%).

The audit covered five out of the six project districts of Arua, Nebbi, Yumbe, Adjumani and Moyo in Northwestern region of the country for a period covering four financial years of 2003/04, 2004/05, 2005/06 and 2006/07 to December 2007.

The overall audit objective was to assess how the project components of Production Enhancement, Infrastructure development and Micro Credit had been implemented. The specific objectives of the audit were: • To assess whether farmers were adequately trained in accordance with Project plan. • To assess whether farmers were mobilized to access micro credit support as planned in the project. • To assess whether roads, markets, and bridges were constructed and completed on time to benefit farmers as planned in the project. • To make recommendations that will help management bring about improvements in project implementation.

4.1.7 Methods of Data Collection

The audit was conducted in accordance with International Organization of Supreme Audit Institutions (INTOSAI) standards. Those standards require that performance audit should be planned, conducted and reported on in a manner, which ensures that an audit of high quality is carried out in an economic, efficient and effective way and in a timely manner. Data was collected through field observations, interviews and document review.

4.2 FINDINGS

4.2.1 Training Farmers Training of farmers was a major activity under the Production enhancement component of the project. Farmers were trained in multiplication and use of improved seeds, animal traction technology, agro-forestry practices and general improved farming practices.

The trainings were conducted through workshops, demonstration farms and through field visits by Field Extension Workers (FEWs). The Project was successful in the introduction of animal traction and agro-forestry practices and strengthening capacity of district personnel. However, training of farmers did not meet the expected performance level.

According to project monitoring and evaluation manual, Annex 2, Logical Framework, 51,000 farmers were to be reached directly by FEWs through out the project life. Another 20,000 farmers (10,000 women) were to be trained, according to the project implementation manual.

Districts in their annual and quarterly work plans set target numbers of farmers to be trained and directly reached by FEWs. In the period ranging from 2003/4 to 2007/8 December, a total of 31,794 farmers were planned for training and by districts as per table below:-

Planned Farmer’ Training Number of Farmers Planned for Training District 2003/4 2004/5 2005/6 2006/7 2007/8* Total Arua 683 627 111 106 450 1,977 Nebbi 1,754 3,267 1,964 7,768 0* 14,753 Moyo 2,628 392 1,239 290 66 4,615 Yumbe 1,548 264 493 2,704 368 5,377 Adjumani 3,105 563 187 427 790 5,072 Total 9,718 5,113 3,994 11,295 1,674 31,794

Source: Compiled by OAG from District Annual and quarterly Work plans. N.B 2007/08* =For the 1st Quarter only and 0* =No target set.

A review of quarterly and annual work plans, and progress reports revealed that farmers were not trained as planned. Out of 31,794 farmers planned for training only 9,824 were trained by December 2008 representing a performance level of only 31%.

Least performance was noticed in Yumbe district where out of 5,377 farmers planned, 423 were trained (8%). The best performance was registered by Nebbi district where out of 14,753 planned, 6,668 farmers were trained (45%) due to the high numbers of farmers mobilized during training.

The project performed poorly in 2003/04 FY where out of 9,718 farmers planned, 1,481 were trained giving a performance level of 15%. Some improvement in project performance was achieved in 2004/05, 2005/06 FYs (48%) and first quarter of 2007/08 (44%).

From the graph that follows, it is evident that generally all districts did not perform to their expectations. Performance gaps were experienced in all the project years.

Graph Showing number of Farmers Trained per District in Different Years

Source: Compiled by OAG from District Quarterly plans and progressive reports.

The inadequacy in training farmers was attributed to delayed delivery of planting materials by suppliers which hindered a wide involvement of farmers on the ground and fewer field visits conducted by FEWs who were inadequately supervised by district project coordinators as discussed in details below:-

Delivery of Planting Materials The training of farmers was affected by the delays in the delivery of seeds which are used for training by FEWs. Due to delayed seed delivery, limited number of farmers was involved on the exercise.

A review of delivery notes and goods received notes revealed that seeds were not delivered within the expected fourteen days after issuance of the purchase orders. Most delays were noted in 2005/06 FY where all the five districts registered an average delay of 132 days. Shorter delays were noted in 2003/04 FY (25.8), 2004/05 FY (23.6) and the first quarter of 2007/08 FY (18) on average. Moyo, Nebbi and Arua districts registered the longest average delays of 98, 78 and 63 days respectively. Details in table that follows:-

Delays in the Delivery of Seeds (Days) District 2003/4 2004/5 2005/6 2006/7 2007/8 Total Average Arua 21 13 264 5 14 317 63.40 Nebbi 108 32 39 135 76 390 78.00 Moyo 0* 73 337 81 0* 491 98.20 Yumbe 0* 0* 3 70 0* 73 14.60 Adjumani 0* 0* 15 45 0* 60 12.00 Total 129 118 658 336 90 1,331 266.20 Average 25.8 23.6 131.6 67.2 18 266.2 53.24 Source: Compiled by OAG from District procurement records. NB 0* means no information on delivery provided.

During interviews with all five DPCs and five SMSs (Agronomy and Forestry) they all attributed the delays to lack of capacity of the local suppliers to supply seeds forcing them to source supplies from Kampala based suppliers. They further explained that Kampala based suppliers take longer to deliver due to the long distance involved from Kampala and the poor state of the road net work in the region.

It was also observed that beans, maize and sorghum seeds worth Ush.11,580,000 supplied in Arua district were not distributed to farmers due to late delivery. The seeds were planned for distribution to farmers in the rain season of August/September 2007. Seeds were delivered at the end of October 2007 after the rains forcing the DPC to keep them in stores. The DPC stated that the seeds would be distributed to farmers in the next rainy season of March/April 2008 (4 months later) and this delay could affect the germination capability of the seeds.

Extension Field Visits and Supervision

The training of farmers was further affected by fewer field visits conducted by FEWs than planned. Out of 1,819 visits planned, only 419 (23%) were conducted. See table below.

Field Visits Conducted by FEWS

Districts 2003/4 2004/5 2005/6 2006/7 2007/8 Total Planned 158 162 0* 32 50 402 Arua Actual 0 9 0* 30 0 39 Planned 501 0* 19 0* 218 738 Nebbi Actual 266 0* 8 0* 0 274 Planned 0* 91 0* 0* 0* 91 Moyo Actual 0* 29 0* 0* 0* 29 Planned 36 17 218 83 42 396 Yumbe Actual 0 5 30 10 0 45 Planned 54 96 12 30 0* 192 Adjumani Actual 3 0 11 18 0* 32 Planned 749 366 249 145 310 1,819 Total Actual 269 43 49 58 0 419 Source: Compiled by OAG from District quarterly plans and reports NB 0* means no information on visits provided.

It was further noted that FEWs were not regularly supervised by the DPCs and SMSs. Out of 1,908 planned supervisory visits, 529 were conducted representing only 28% of the planned visits. Supervision was poorly carried out in Yumbe (722), Arua (276) and Adjumani (208) as per details in the table that follows.

Supervisory Visits Conducted by DPC and SMS

Districts 2003/4 2004/5 2005/6 2006/7 2007/8 Total Arua Planned 171 174 44 0* 58 447 Actual 46 62 10 0* 53 171 Nebbi Planned 69 0* 12 12 1 94 Actual 39 0* 0* 9 1 49 Moyo Planned 30 37 62 30 0* 159 Actual 0 21 60 0 0* 81 Yumbe Planned 120 131 360 120 90 821 Actual 0 39 10 0 0 49 Adjumani Planned 64 90 30 173 30 387 Actual 22 15 7 105 30 179 Total Planned 454 432 508 335 179 1,908 Actual 107 137 87 114 84 529 Source: District quarterly plans and reports NB 0* means no information on visits provided.

Late delivery of seeds, the fewer extension visits by FEWs and limited supervision of DPCs and SMSs led to the training of fewer farmers in improved agricultural practices than planned by the project.

4.2.2 Infrastructure Development Under the infrastructure development component of the Project, the following activities were supposed to be implemented:- i. Rehabilitation of 200 kilometers of priority roads, ii. Routine manual maintenance of 1600 kilometers of community roads, iii. Recurrent maintenance of 1600 kilometers of community roads, iv. Periodic maintenance of 200 kilometers of priority roads, v. Construction and rehabilitation of building structures at DFIs and vi. Improve water supply and sanitation in priority markets.

The project has successfully managed to periodically maintain 1600 kilometers of selected community roads in the districts. Communities are involved in maintaining the roads and funds are released on a quarterly basis to districts to carry out the activities. However the project registered some set backs in the construction and rehabilitation of 200 kilometers of roads and bridges, the construction and rehabilitation of district farm institutes, markets and provision of water points. Construction works are not on schedule as stated in the project implementation plan. According to project implementation plan, Paragraphs 6.2.4 and 7.2 (i) pages 19- 21, construction of roads, bridges, markets and District Farm Institutes (DFI) were expected to be completed within the first two years of project implementation up to December 2002. The causes of the delay were identified to include the following:-

Production of Technical Designs: It was noted that the technical consultant, did not accomplish the task of designing technical drawings for the construction of roads, bridges, markets and DFIs despite the payment of US $ 180,000 (Ushs.306, 000,000) to the contractor by the project.

In its efforts to avert the situation, NPCU in consultation with ADB, contacted the Ministry of works and transport engineers for technical drawings at an additional cost of

Shs.87,000,000. The technical designs were completed after six years in 2006 and contracts awarded in November 2006 and July 2007.

Heavy Rainfall And Distant Source Of Construction Materials: Interviews with site engineers, DPCs and district engineers/ works supervisors attributed the delay to heavy rainfall which disrupted construction works and transportation of materials. They also expressed concern that most of the construction materials are procured from Kampala which is very distant from construction sites in the districts hence the delay in the delivery of materials.

Lack of Capacity By Some Contractors: The audit however attributes the delay to lack of capacity by some contractors to finance construction works using their own funds. Some contractors have been awarded more than one contract in the districts thereby straining their capacity further.

We noted that although districts some times delayed to process and pay certified works of contractors, all submitted certificates were paid. The contractors were not injecting back the funds into the projects, but instead using it for other purposes.

Limited Supervision: The delay in construction works is also attributed to irregular supervision by NPCU staff who are located in Entebbe contrary to the resolution in one of the aide memoir reports of relocating to the regional headquarters for effective supervision.

We also noted that the supervision by district engineers was not effective. District engineers’ reports could not express pertinent issues concerning the projects because their independence was compromised by the fact that their supervisory allowances were paid by contractors. District engineers may find it difficult to query certificates as this would lead to delayed payment of the contractors and subsequently their allowances.

Partial Compliance to General and Specific Conditions of Contract: The audit also noted that the delay in the completion of projects was caused by lack of enforcement of some compliance clauses in the contracts. The general and specific conditions of contract provided for the payment of liquidated damages by contractors who unnecessarily delayed projects. The NPCU did not enforce the clauses yet some contractors without justification continued to delay the projects. If the contactors were paying fines for the number of days the projects were delaying, such delays would be minimal.

Increasing Fuel Prices: According to management, contractors were also faced with a problem of fuel shortages and escalating prices. This affected their work progress hence the delay in completion of projects as scheduled.

During the review of contract agreements, work certificates and district engineers’ progress reports, it was revealed that construction works further delayed for an average of 245 days (Roads), 208 days (Bridges) and 102 days (DFIs) after the award of contracts and subsequent commencement of works. Contractors failed to complete the works as scheduled in the contract agreements. Details in the table below.

Delayed Completion of Infrastructure Works (Days)

District Roads Bridges Markets DFI

Contracts Days Contracts Days Contracts Days Contract Days s Arua 2 494 1 180 2 NA 1 NA Nebbi 2 472 2 372 2 NA 1 103 Moyo 3 741 3 618 3 NA 1 NA Yumbe 1 247 1 247 2 NA 0 NA Adjumani 1 247 1 247 3 NA 1 100 Total 9 2,201 8 1,664 12 NA 4 203 Average 244.6 208 NA 101.5 Source: Compiled by OAG from District contract documents and Engineers progress reports NB (NA) means inspection carried out before expected completion dates and no delay existed at the time.

Markets During field inspections, out of 17markets, 13 were inspected (76%). It was observed that 12 of the 13 (92%) markets were not completed and were at foundation level. Only one market (Ofua) in Adjumani district was found at ring beam level.

Roads Out of 16 roads in the five districts, 10 (62.5%) were physically inspected. Road inspection revealed that all the 10 roads were not completed. Opening of roads was done but they have become bushy again. Some culverts were poorly installed at some points and at others completely not installed. Road works at Arivu-Jayia-Opia road (Arua) and Obilokongo-Moinya road (Adjumani) were found abandoned by contractors.

Bridges Out of 15 bridges in the five districts, 10 (67%) were visited. In all the 10 bridges inspected, work was on going. Five bridges in Yumbe and Nebbi districts had minor works to be completed. Works at Moinya bridge in Adjumani district was abandoned. The contractor at Airo bridge, Moyo district, was fully paid before work was completed.

Delayed award of contracts was caused by the lack of production of technical designs by the technical consultant who, from explanations of district engineers, lacked capacity to handle the task. There was also laxity by NPCU to avert the problem in time as the decision to use ministry engineers came up late.

4.2.3 Release of Funds According to project implementation procedures, funds are released from the Special Account (SA) to the Local Currency Account (LCA) of the Project and then transferred to the district project accounts at the beginning of the first month of every quarter. During the review of the district cash books, monthly bank statements and accountability returns it was revealed that districts were not regularly receiving funds in accordance with the project procedures governing funds disbursement. There was a general delay in the release of funds to the districts of 55 days on average per quarter. The districts of Arua, Yumbe and Moyo were mostly affected with average quarterly delays of 62, 58 and 57 days respectively. The districts experienced most delays in 2004/05 FY, 2006/07 FY and 2003/04 FY of 77, 65 and 53 days on average per quarter respectively. Shortest delay of 28 days was

noted in the first quarter of 2007/08 FY. Details of the delay are shown in the table that follows.

Average Quarterly Delays in the Release of Funds (Days) District 2003/4 2004/5 2005/6 2006/7 2007/8 Total Average Arua 65 83 61 77 28 314 62 Nebbi 54 83 37 56 28 256 51 Moyo 45 83 60 70 28 285 57 Yumbe 50 72 58 70 28 277 58 Adjumani 54 68 37 56 28 242 48 Total 266 387 252 327 141 1373 275 Project 53 77 50 65 28 275 55 Source: Compiled by OAG from District Cash books and Bank statements.

The interviews with the NPC and the project accountant, however, attributed the delay to also late submission of accountabilities by the districts since funds can not be released to districts before accounting for previous releases.

During a review of accountability returns prepared by districts it was noted that accountabilities were not submitted to NPCU in time. Districts did not account for funds released to them at the end of the quarter as required due to laxity of district coordinators and some times due to delayed implementation of activities. Accountabilities delayed for an average of 33 days per quarter in all the districts in the period under review. Moyo district registered the poorest performance with an average quarterly delay of 61 days.

Worst performance in this area was noted during 2003/04 FY (102 days per Quarter) with Moyo district again contributing highly. Better performance was registered in the first quarter of 2007/08 FY (8 days) where the three districts of Arua, Yumbe and Adjumani took only 4 days on quarterly average to account for the funds. Details are presented in the table below:-

Average Quarterly Delays in Submission of Accountabilities (Days) 2003/4 2004/5 2005/6 2006/7 2007/8 Total Average Arua 2 31 2 0 4 39 8 Nebbi 139 15 13 15 0 182 36 Moyo 221 12 14 31 29 307 61 Yumbe 43 43 0 0 4 90 18 Adjumani 103 22 66 6 4 200 40 Total 508 122 95 52 41 817 163 Average 102 24 19 10 8 163 33

Source: Compiled by OAG from District accountability returns (NB 0* means no information on delivery provided)

The above observation would have been different had all accountability returns been provided for review. Accountability returns for the Shs.840,746,468 were not provided for review due to poor record keeping at both NPCU and district headquarters caused by lack of record keeping skills by the in charge of records, the table below refers.

Missing Quarterly Accountabilities Total 2003/4 2004/5 2005/6 2006/7 2007/8 (Nos) Total (Shs) Arua 1 0 2 2 0 5 391,634,618 Nebbi 0 0 2 1 0 3 226,656,000 Moyo 0 0 0 0 0 - 0 Yumbe 0 0 2 1 0 3 222,455,850 Adjumani 0 0 0 0 0 - 0

Total (Nos) 1 0 6 4 0 11 840,746,468 Source: Compiled by OAG from District Cash books and bank statements (NB (0) Accountabilities seen)

During interviews with all the DPCs and district accounts assistants, it was confirmed that delays in accountabilities is caused by delayed implementation of activities which drag on, sometimes spilling over to the next quarters. They also attributed the delay in the implementation of activities to delayed release of funds by NPCU.

Delayed release of funds has led to insufficient or lack of funds at the disposal of districts for implementation of project activities in accordance with project implementation plans. District

project activities like procurement of seeds and training of farmers were affected by delayed release of funds as discussed in paragraph 3.2 of this report.

4.2.4 Farmers Joining Savings and Credit Cooperative Societies Under the Micro Credit component of the project, the following objectives were implemented by the project:- i. To provide micro-credit support for farm input purchase and off-farm credit. ii. To provide micro-credit support to finance worthwhile marketing activities.

In order to attain the above objectives, NSADP entered into an understanding with Micro Finance Support Centre Limited (MSCL) to manage the component and subsequently released a sum of US $1,038,889 (equivalent of Shs.1, 302,000,000 at the time of disbursement in 2005) for the benefit of Savings and Credit Cooperative Societies (SACCOS).

According to project implementation plan, paragraph 8.0 page 24, farmers are mobilized to register with SACCOS to enable them access agricultural loan facilities for off-farm, marketing and crop production activities.

Priority was focused on project target groups and the most poverty stricken areas. To ensure the achievement of the above, NSADP in its Monitoring and Evaluation manual, Annex 2, the logical framework paragraph 3.0 (C), targeted 10,000 farmers, 6,000 of whom are women to access farm credit.

In addition, 550 marketers and 2,000 house holds dealing in agro-business were targeted. It was noted that the Project failed to reach the target number of beneficiaries as planned and this was attributed to the following factors:

Mobilizing Farmers: The poor mobilization efforts by MSCL is attributed to lack of coordination with districts in the implementation of the micro credit component of the project and lack of follow up mechanism on MSCL activities by NPCU. Interviews carried out with all the five DPCs and SMSs (Marketing Opportunities) revealed that mobilization of farmers in matters of loan accessibility is an activity handled by MSCL

and SACCOS. They further explained that MSCL and SACCOS do not report their activities to the districts, but directly to NPCU.

A review of NPCU records revealed that MSCL had not prepared any report showing its performance contrary to section 5 of the Memorandum of Understanding (MOU) signed between GOU and MSCL dated 12/08/2002. However, management asserted during discussions that MSCL started reporting its performance in 2006 to-date, but the reports provided for review do not indicate the number of farmers given loans by their gender and other categories as specified in the project M&E manual.

During discussions with the regional MSCL branch manager (West Nile region), it was noted that mobilization programmes are aired out on various FM radio stations in the region, but he could not provide evidence to that effect and how often this was done. Copies of returns/reports the Arua MSCL regional office forwards to their headquarters in Kampala did not show evidence of mobilization.

Interviews carried out with managers of all the six registered SACCOS in the five districts visited revealed that mobilization of farmers is a sole responsibility of MSCL and that SACCOS are only visited by MSCL to monitor their loan performance. It is expected, however, that farmers who benefit from the loans pass over the information to others. Ayivu SACCO in Arua district took some initiative to mobilize farmers through a weekly radio programme that ran for six months in 2007. We further noted that the managers of SACCOS do not differentiate their sources of funding and as a result agricultural loans from MSCL are not specifically treated and would go to their clients whether you are a farmer or not. It was also noted that MSCL runs radio mobilization programmes in general terms without focusing on farmers who were/are targeted by the project.

During field inspections, all 8 farmer groups and 7 farmers visited showed ignorance of the existence of such loan facilities under the project with an exception of two farmers from Nebbi district that had received the information from their respective SACCOS and acquired loans to the tune of Shs.3, 450,000. It was further noted that mobilization efforts of MSCL were not reaching the target groups.

High Interest Rates Charged by SACCOS: It was also noted that farmers have failed to access the loans due to the high interest rates charged by SACCOS and other stringent requirements like minimum savings one should hold in a SACCO before qualifying for a loan facility.

Poor Project Design: It was noted during discussion with management, that during project design it was assumed that farmers would automatically join SACCOS and be able to access agricultural loans. In districts where there was limited number of SACCOS farmers could automatically not access loans. Management cited that the loan component of the project performed very well in Nebbi district due to the existence of 3-4 SACCOS at project inception.

4.3 CONCLUSIONS

4.3.1 Training Farmers The project objective of improving farmers’ incomes in the region through increased agricultural production obtained from the application of improved agricultural practices was not achieved due to failure by districts to train the target farmers. The number of farmers trained in the period is far below the targeted figures.

4.3.2 Infrastructure Development The project has not achieved its target of completion of construction works in the second year of project implementation hence farmers have not benefited from the use of infrastructure development to support marketing of their farm produce. Most construction works will not be completed in the near future given the pace of construction.

The overall performance of the project has been affected by poor implementation of the infrastructure component which accounts for Shs.15.49 billion which is 40% of the project funding excluding physical and price contingency of Shs.7.38 billion (19%).

4.3.3 Release of Funds The districts have had a poor culture of accounting for funds released to implement project activities. Submission of accountabilities takes longer than the expected period hence

affecting the disbursement processes. Project activities like training of farmers have not been satisfactorily implemented due to lack of funds as shown by performance gaps in all project disciplines.

4.3.4 Farmers Joining Savings and Credit Cooperative Societies There was inadequate mobilization of farmers to join SACCOS and as a result many project trained farmers have not joined SACCOS hindering them to access agricultural loan facilities. The high interest rates charged by SACCOS have also hindered farmers from accessing loan facilities. Farmers trained by the project do not meet the above conditions and as a result the loan facilities have been extended to other beneficiaries not targeted by the project.

4.4 RECOMMENDATIONS

4.4.1 Training Farmers The project should increase its efforts of training farmers in seed multiplication to build local capacity that will enable sourcing of improved seeds from farmers within the districts. This will reduce further on the time required to deliver seeds from distant suppliers.

The district accounting officers should invoke the provision for penalties specified in the Local Purchase Orders regarding late delivery of goods and services to ensure that suppliers who fail to adhere to terms and conditions of contract are penalised.

Subject matter specialists and district project coordinators should strengthen their supervisory mechanism to ensure that field extension workers carry out their field visits as planned in the quarters.

4.4.2 Infrastructure Development NPCU should increase on its supervisory visits and the project engineer together with other headquarters staff should relocate from Entebbe to Arua project offices as recommended in one of the aide memoir reports by ADB. The above will enable regular supervision and monitoring of the progress of construction works.

It is recommended that district engineers should not be paid by the contractors for supervision work as this undermines their independence in reporting on the progress of construction works.

It is further recommended that payments of US $ 180,000 (Ushs.306,000,000) be recovered since no technical designs were produced by the firm and any payments be halted.

The General and Special conditions of contracts governing performance security and liquidated damages stated in individual contracts should be invoked to ensure that the errant contractors immediately finish the works without further delay.

4.4.3 Release of Funds District project coordinators should speed up the accountability process to ensure that implementing officials account for funds released to them immediately after the completion of a project activity. This will in turn enable NPCU to release funds on time. NPCU should also improve on its record keeping system to allow immediate identification of defaulting districts and ensure that an effective follow up mechanism is put in place.

4.4.4 Farmers Joining Savings and Credit Cooperative Societies It is recommended that the procedures in the implementation of the micro credit component of the project be revisited to involve districts staff who are always in contact with farmers on the ground.

Micro finance Support Center Limited (MSCL) should increase its mobilization activities to bring more farmers on board and these activities should be rigorously supervised and monitored by NPCU.

MSCL should prepare progress reports in accordance with section 5 of the Memorandum of Understanding (MOU) which should consistently be reviewed by NPCU for proper monitoring of the component.

SACCOS should properly brand their loan products to distinguish agricultural loans from others and ensure that funds from MSCL are strictly applied for the intended purpose.

In addition, MSCL and Savings and Credit Cooperative Organizations (SACCOS) should follow the guidelines in the project implementation plan and MOU signed between Government and MSCL which govern loan disbursement and accountability to ensure that farmers access agricultural loan facilities.

5.0 PREVENTION AND CONTROL OF LIVESTOCK DISEASES BY THE DEPARTMENT OF LIVESTOCK HEALTH AND ENTOMOLOGY IN THE MINISTRY OF AGRICULTURE ANIMAL

INDUSTRY AND FISHERIES – (ISSUED MARCH 2009)

5.1 INTRODUCTION This audit report is about the prevention and control of livestock diseases and it is aimed at coming up with recommendations to help the department of Livestock health and Entomology improve the way the major activities in prevention and control of livestock diseases are carried out. This audit was conducted in accordance with Article 163(3) of the Constitution of the Republic of Uganda.8 This mandate is amplified under Section 21(1) of the National Audit Act 20089 which requires the Auditor-General to carry out value for money audits for purposes of establishing economy, efficiency and effectiveness in the operations of any department or ministry.

5.1.1 Background to the study MAAIF is responsible for supporting, promoting, guiding and regulating the production of Livestock, Fisheries and Crops in order to ensure improved quality, quantity of the produce and their products for local consumption, food security and export. This function is carried out by MAAIF in the two Directorates of Crop Resource and Animal Resources and Fisheries. The department of Livestock Health and entomology which is under the Directorate of Animal Resources and Fisheries is charged with preventing, controlling and eradicating where possible, livestock diseases.

5.1.2 Reasons for the audit

The audit was motivated by the public outcry over the increased infection and death of livestock. Furthermore, there have been press reports about pastoralists moving livestock in and out of the country in an uncontrolled manner and occupying land illegally for grazing livestock. These

8 Constitution of the Republic of UGANDA (1995) as amended by Article 165.

reported illegal movements and land occupations have contributed to the increased spread of livestock diseases and livestock deaths because livestock epidemic diseases are frequently spread by the movement of infected animals.

“The movement of animals and their products which do not meet mandatory standards put man and animals at risk of infectious diseases, vectors, pests and or contaminants. Such sub-standard activities whenever they occur put households who depend on animal industry at food security and economic risks.’’10. This has put both animal and man at health and economic risk. Epidemic diseases inhibit export trade opportunities for livestock and livestock products. Beside food security and household incomes, the livestock industry contributes significantly to the economy of Uganda by about 9% of the Gross Domestic Product and about 17 % of the Agricultural Gross Domestic Product. About one third of all farm related households in Uganda are estimated to derive their livelihoods from the animal sub sector11.

A review of exports and imports of livestock products from 2003 to 2007 established that the country has been exporting more livestock products than it imports as shown in Table 1 below,

Imports and Exports of livestock and livestock products in Uganda (2003-2007) Year Exports (Ushs ) Imports (Ushs) 2003 11,492,233,503 6,621,662,621 2004 12,962,449,653 4,833,286,911 2005 15,217,745,316 4,011,878,476 2006 16,153,873,257 5,707,728,587 2007 39,969,438,330 8,368,208,260 Cumulative Totals since 2003 95,795,740,059 29,542,764,855 Source: OAG analysis of data from URA’s Ascuda generated reports

Despite MAAIF’s interventions through government finance and projects such as PACE, FITCA, NLPIP and Creation of Tsetse and Tripanosomiasis free areas, livestock disease trends have not significantly reduced in the past three years. There has been no significant reduction in the

9 National Audit Act 2008 10 Veterinary technical manual for animal movement control in Uganda- First Edition October 2007 11 Veterinary technical manual for animal movement control in Uganda- First Edition October 2007 page 4

occurrence of livestock diseases in districts of Arua, Kotido(CBPP) Kasese,Lira(LSD) and Rakai (FMD) where the livestock diseases such as CBPP,LSD and FMD have occurred every year in the periods under review.

Outbreaks of four major notifiable livestock diseases in the districts.

Recorded livestock disease outbreaks

35 30 25 20 No of affected districts 15 10 5 0 2003 2004 2005 2006 2007

Years FMD CBPP LSD ASF

Source: OAG analysis of diseases from MAAIF’s cartographic maps

This study was conducted to assess the performance of the department in the core activities of prevention and control of livestock diseases and subsequently where possible come up with appropriate recommendations that will help the department improve in addressing problems of livestock disease.

5.1.3 Statutory Mandate The department of livestock health and entomology is part of MAAIF whose mandate, vision and mission are stated below:-

The mandate of MAAIF is “To support, promote and guide the production and processing of crops, livestock, fish and all other agro-related activities in a sustainable manner so as to ensure the best quality for the consumers in the market and increased quantity of agricultural produce and products for domestic consumption, food security and export’’.

5.1.4 Major Activities of the Department

The major activities of the department are; a) Formulating strategies for preventing and controlling animal diseases and disease epidemics. b) Monitoring outbreaks and prevalence of diseases, importation and exportation of animals and their products in and out of the country. Monitoring performance of the entomology division and livestock health activities in the Local Governments (LG’s) to ensure that they are in conformity with national policies, standards, legislation and plans. c) Carrying out surveillance of diseases and obtaining samples from the districts for diagnosis and examination. d) Prompt collection, collation and dissemination of epidemiological data. e) Advising the district authorities and the decision makers on disease control strategies. f) Collaborating with neighboring countries, research and international organizations on disease control. g) Availing and administration of vaccines, advising on importation, distribution and marketing of drugs and chemicals in collaboration with National Drug Authority (NDA) for use on livestock. h) Enforcement of laws and regulations pertaining to prevention of disease spread from animals to humans. i) Carrying out sensitization / awareness campaigns on animal disease control.

5.1.5 Sources of funding

The major funding of the department is from the Government of Uganda (G.O.U). However it is also funded by donors from time to time through various initiatives e.g. FITCA, NLPIP, PACE, Pan African Tsetse and Trypanosomiasis eradication campaign (PATTEC) and Creation of Tsetse and trip free areas. These initiatives are sometimes co-funded by the GOU, with the Memorandum of Understanding specifying the various duties and responsibilities of the parties involved.

Livestock health and entomology funding from 2004/05 to December 2007.

Source of Funding 2004/05 2005/06 2006/07 Jul 07-Dec 07

GOU Recurrent 467,206,005 586,342,764 542,074,387 269,752,455

GOU Development 1,193,671,570 3,045,469,720 5,683,092,514 653,294,000 Donors-NLPIP 626,631,840 430,386,690 436,804,096 698,245,000 -FITCA 85,529,446 129,745,461 210,430,416 338,080,000 -Creation of 44,501,000 44,380,000 Tsetse and trip free area TOTAL FINANCING 2,373,038,861 4,191,944,635 6,916,902,413 2,003,751,455 Source: OAG analysis of financial data from Integrated Financial Management System (IFMS)

NB: 2003/2004 Financial data was not readily available because the IFMS system was not in place then.

5.1.6 Audit scope The audit focused on the management of prevention and control of livestock diseases by the livestock health and entomology department in MAAIF.The study covered 13 selected districts namely, Arua, Lira, Gulu, Tororo, Soroti, Kotido, Nakapiripirit, Nakasongola, Mukono, Rakai, Mbarara, Ntungamo and Kasese which are involved in prevention and control of livestock diseases. It further involved visiting and assessing the operations and controls at the livestock border entry points of Paidha, Vurra, Oraba, Mutukula, Mirama hills, Malaba, and Mpondwe. The team also visited Lake Mburo and Queen Elizabeth National Parks and obtained information from Murchison falls and Kidepo National parks under Uganda Wild Authority (UWA) in order to assess the coordination between UWA and the neighbouring districts on the control and prevention of livestock diseases. The audit covered the period July 2003 to December 2007.

The audit objective was to assess the performance of the department and come up with suitable recommendations based on the findings so that the department may make improvements in prevention and control of livestock diseases.

5.1.7 Audit methodology The audit was conducted in accordance with International Organization of Supreme Audit Institutions (INTOSAI) Performance Auditing Standards. These standards require that

performance audit should be planned, conducted and reported on in a manner which ensures that an audit of high quality is carried out in an economic, efficient and effective way and in a timely manner. Data was collected through conducting interviews, review of documents and physical observations.

5.2 FINDINGS

This chapter presents audit findings. The findings relate to; notable achievements, vaccinations, sensitizations, surveillance, diagnosis, enforcement, coordination collaboration between MAAIF and Key stakeholders and Vector control.

5.2.1 Notable Achievements Some of the achievements of the department of Livestock Health and Entomology include:-

5.2.1 .1 Eradication of Rinderpest

The Pan African Control of Epizootics (PACE) which began in 2001 laid down a suitable foundation for the pathway to freedom from the Rinderpest disease. This programme which emphasized surveillance for early detection and determination of infection resulted in a provisional declaration of freedom from the disease in Uganda in 1999 on a Zonal basis and in 2002 the whole country was provisionally declared free from the Rinderpest disease. MAAIF is commended on this achievement.

The progressive decline in sero-positivity levels from 3.3% in 2003 to 0.0037% in 200612 and fulfillment of all other requirements for freedom from the disease culminated in the submission of a dossier to the OIE requesting for accreditation of Uganda as a country free from Rinderpest disease. In accordance with the provisions of article 2.2.12.2 of the OIE Terrestrial Code, Uganda was officially recognized as a Rinderpest free country by the OIE in 2008.

5.2.1.2 Control of the outbreak of Anthrax in Queen Elizabeth National Park

Anthrax is an infectious, febrile disease caused by bacteria. This disease is often characterized by its sudden onset and rapidly fatal course. In August 2004, incidents of hippos dying in the waters of Kazinga Channel, Lakes George and Edward within Queen Elizabeth National Park (QENP)

12 Pathway of freedom from Rinderpest disease in Uganda.

were reported to UWA. As at 21st October 2004 about 186 hippos had died. There was a risk of infection to humans and livestock in the surrounding areas.13

The outbreak was controlled through a multidisciplinary National Task Force with MAAIF and UWA taking the lead. It also involved the community and private companies. This incident was a confirmation that collaboration between MAAIF and UWA is very important in preventing and controlling livestock diseases.

However the audit also revealed some weaknesses in the activities of prevention and control of livestock diseases as shown below:-

5.2.2 Surveillance

5.2.2.1 Passive Surveillance

Disease surveillance is a major and integral component of all government veterinary services. This is vital for early warning of diseases, planning and monitoring of disease prevention and control programmes, provision of sound animal health advice to farmers. It is particularly important for animal disease emergency preparedness.

In order to accomplish the surveillance function, OIE terrestrial Health code requires countries to make available to other countries, through OIE, whatever information is necessary to minimize the spread of important animal diseases and to assist in achieving better world wide control. MAAIF requires districts to avail monthly epidemiological data not later than the 15th day of the subsequent month. MAAIF set a standard of at least 10 reports submitted annually by every district. These reports should capture all information on livestock disease prevention and control activities like disease outbreaks, vaccinations carried out, vaccine stocks and meat inspections, laboratory activities, veterinary inspection services and animal movements. This information is gathered by the VOs and AHOs at the lower local governments while the DVOs monitor their activities.

13 UWA report on disposal of Hippo carcases from Queen Elizabeth National Park following outbreak of Anthrax in 2004

Epidemiological Reports submitted by Districts from 2003 to 2007

DISTRICTS YEARS 2003 2004 2005 2006 2007 Arua 11 11 8 4 8 Gulu 12 11 12 11 10 Kasese 10 12 12 12 12 Kotido 10 5 0 12 7 Lira 12 12 12 8 9 Mbarara 12 12 12 12 7 ukono 12 10 8 4 6 Nakapiripirit 10 4 3 9 11 Nakasongola 11 12 12 11 11 Ntungamo 10 12 12 10 7 Rakai 12 9 12 9 11 Soroti 12 11 12 11 11 Tororo 11 12 8 10 11 Source: OAG analysis of epidemiological reports from districts Note: *Districts should submit at least 10 reports per annum

The analysis of the epidemiological report submission of the thirteen districts visited showed that all districts submitted at least ten epidemiological reports in 2003. In the period under study (2003-2007), only Gulu, Kasese, Nakasongola and Soroti submitted at least ten epidemiological reports per annum while the districts of Mukono, Nakapiripirit Arua and Kotido failed to submit the required number of reports in three out of the five years. All districts did not submit epidemiological reports by the 15th day of the subsequent month; but did so after two months on average.

We reviewed 50% of the epidemiological reports and noted that, a third of them were incomplete thereby making them inadequate as they lacked some vital information needed for surveillance purposes.

The failure by districts to submit the required number of reports on time per annum was attributed to the failure by MAAIF to identify effective methods of encouraging submission and enforcing this requirement.

Failure to submit fully completed and timely reports was attributed to the failure of the DVOs to effectively monitor and supervise the activities of the VOs and AHOs at the lower local governments so as to ensure that all livestock information is collected. Insufficient transport means also contributed to the late submission.

Non submission of the required number together with the submission of incomplete epidemiological reports resulted in some livestock information from the non compliant districts not being captured. The late submission resulted in information being captured late thereby being ineffective for timely planning.

5.2.2.2 Active Surveillance

When disease outbreaks are suspected in some locations at districts, DVOs are required to carry out purposeful and comprehensive searching for evidence of disease in animal populations or for verification that such populations are free of specific diseases. DVOs make initial assessments of the nature and extent of disease outbreaks. This is done by carrying out simple hematological and microbiological tests from the mini laboratories at the districts.

MAAIF is supposed to be informed of disease outbreaks by the DVOs within 24 hours upon which it dispatches teams to collect samples from the districts for testing at the National Diagnostic Laboratory. MAAIF is then expected to communicate the results of the tests to the affected districts within 3 days (72 hours).

We noted from a review of epidemiological reports and interviews with DVOs that MAAIF took on average four weeks to diagnose diseases from the time of outbreaks to communicate the test results in some cases however MAAIF appears not to have taken action on the reported cases. For example in Ntungamo outbreaks of FMD and LSD were reported in 2006 and 2007 respectively, however, no samples were picked by MAAIF for testing.

Time taken to communicate diagnostic results.

District Disease Date of Time taken to Time taken to Delay in Weeks outbreak collect samples communicate diagnostic results Mbarara FMD April 2007 After one week After one week More than2 weeks Mbarara Bird flu Feb 2007 After one day After two weeks More than2 weeks Kasese FMD May 2007 After one month After one month More than8 weeks Ntungamo LSD Jan/Feb Not taken* N/A 2007 Ntungamo FMD April 2006 Not taken* N/A Source: Epidemiological reports and interviews with DVOs. Samples were not taken from Ntungamo because samples from Mbarara and Kasese confirmed existence of FMD.

Mean while some Districts do not have diagnostic information due to poor record keeping, while others could not have data on the time taken to collect samples and time taken to communicate diagnostic results.

Delays in the time taken to carry out diagnosis at the National Animal Disease and Diagnostic Laboratory was mainly attributed to insufficient reagents and diagnostic equipments and also to inadequate staffing (17 personnel instead of the established number of 34). Late communication of diagnostic results leads to spread of livestock diseases. For instance the FMD out break in Kasese in May 2007 originated from the purchase of sick animals by a farmer from cattle traders in Isingiro district which were later transported to Kasese. This particular incident was attributed to a breakdown in law enforcement.

5.2.3 Cross Border passive Surveillance of Trans Boundary Animal Diseases (TAD)

In collaboration with neighbouring countries, MAAIF is mandated to carry out cross border passive surveillance in border districts. This is necessary for early detection of diseases originating from neighboring countries. This cross border passive surveillance on TADs was intended to cover Rinderpest, FMD, and Rift valley fever, PPR, CBPP, Rabies and African swine fever (ASF).

We noted that the department had been carrying out surveillance mainly on Rinderpest along the Northern and North Eastern border areas adjacent to Kenya and Sudan and other districts along Tanzania, Rwanda and Congo borders. The focus and response to outbreaks of other diseases such as FMD, CBPP, and PPR had been minimal yet these diseases were prevalent in the border districts of Rakai, Arua and Kotido/Nakapiripirit.

The reason for not responding to outbreaks of other diseases apart from Rinderpest in the districts neighboring border areas was mainly due to the project design which focused on only Rinderpest and inadequate funding.

The weaknesses and/or delays in response led to spread of TADs which in effect led to loss of revenue in the affected districts due to the closure of several livestock markets.

5.3 Vaccinations

5.3.1 Routine Strategic Vaccinations

The OIE terrestrial animal health code stipulates the intervals at which animals should be routinely vaccinated for particular OIE listed diseases as a preventive measure.

Intervals for carrying out routine strategic vaccinations No Disease Type No. of Vaccinations 1 Foot and Mouth Disease (FMD) Once a year 2 Rabies Once a year 3 Contagious Bovine Pleuro pneumonia (CBPP) Once a year 4 Contagious Caprine Pleuro pneumonia (CCPP) Once a year 5 Peste des Petits Ruminats (PPR) Once a year 6 Rift Valley Fever (RVF) Once a year 7 New Castle Disease (NCD) Twice a year Source: MAAIF

MAAIF is expected to avail vaccines for routine strategic vaccinations for the notifiable diseases at the said intervals. In all the thirteen districts visited, it was found out that there were no routine strategic vaccinations carried out by MAAIF.

MAAIF did not prioritize routine strategic vaccinations while budgeting and allocating resources, thereby failing to provide vaccines for routine vaccinations. This has resulted in livestock being susceptible to preventable livestock diseases.

5.3.2 Targeted vaccinations

When livestock diseases break out in the districts, the DVOs are required to report to MAAIF within twenty four (24) hours by the quickest means including phone and subsequently by written or fax communication; MAAIF is expected to take samples from the affected areas and carry out diagnosis. Diagnostic test results are then communicated to the affected districts within 72 hours from the time of completing diagnosis implying that vaccinations of livestock ought to commence within a week from the time disease is reported. Vaccines supplied ought to be sufficient to cover the affected areas.

Information obtained from four of the thirteen districts chosen for the study revealed that there were generally marked delays in carrying out targeted vaccinations of affected livestock.

Information from the other nine districts was not available because of poor record keeping. For instance in Rukoni sub County in Ntungamo District, where an outbreak of FMD occurred in April 2006, vaccinations commenced in May 2006, a delay of one month. The vaccines that were received could only cover 40% of the ring vaccinations of the affected areas.

Delays in carrying out targeted vaccinations were caused by delays in taking samples, diagnosing and availing vaccines to affected areas by MAAIF. In instances where insufficient vaccines were availed to affected areas, it was attributed to non availability of vaccines at MAAIF. Delays at the districts were attributed to insufficient logistical support in form of transport and facilitation to personnel to carry out vaccinations.

Delayed targeted vaccinations resulted in the death of some livestock and spread of diseases to unaffected herds.

5.2.4 Laboratory Diagnosis

5.2.4.1 Diagnostic capacity at the National Animal Disease Diagnostic Laboratory.

The national animal disease diagnostics and epidemiology laboratory is expected to have diagnostic capabilities (both technical and logistical) for all notifiable livestock diseases in the country.

The study noted that from 2003 to 2005 the technical and logistical (test kits) capacity at the national laboratory was inadequate. In 2006 and 2007 the situation was strengthened by improving the technical and logistical capacity, however the ability to undertake diagnostic tests of the notifiable diseases like LSD, Rift Valley Fever, Newcastle disease, rabies, CCPP, and infectious Bursal Disease (Gumboro) was still limited due to lack of kits.

Lack of test kits for undertaking diagnostic tests was attributed to lack of prioritization, evidenced in the adequate capacity for diseases. In case of suspected outbreaks of such diseases there will be failure to confirm the disease strain and effectively respond to contain them in time.

5.2.4.2 Diagnostic Capacity at the Districts.

Given the speed at which infectious diseases spread, the key to controlling an outbreak is to detect and diagnise the disease at the earliest possible stage. If a new disease can be recognized while it is still localized and prompt action taken to contain it early, chances of controlling it are markedly enhanced at a low cost with minimum damage to the livestock industry. In order to do this, districts must have capacity to undertake clinical diagnosis of all diseases and to carry out simple haematological and microbiological tests. This can only be possible with the availability of mini laboratories which should have basic minimum laboratory equipment such as centrifuges, fridges, reagents, light microscopes and glass ware (test tubes, beakers, specimen bottles).

Of the 13 districts studied, only Tororo, Rakai, Mbarara and Soroti had functional mini laboratories with all the basic requirements for carrying out tests. Ntungamo district had a laboratory in place which was non functional. It was also established that the districts of Kasese, Arua and Kotido lacked laboratory space, although they had some basic minimum equipment.

Lack of mini laboratories at some districts was attributed to the failure to provide laboratory space (building) by the districts which would then be equipped with the basic mini laboratory equipments by MAAIF.

This resulted in most diagnostic tests (both simple and complex) being referred to the National animal laboratory at MAAIF leading to delays in diagnosis of livestock diseases.

5.2.5 Sensitizations

Sensitizations should be suited to target groups. To achieve this best practice requires that the people targeted should have some input in the development of sensitization materials. For sensitization to achieve the desired results, the language, timing, medium of transmission and the places where sensitizations materials are hanged/ pinned should be appropriate. Sensitization materials should have a local touch and should depict what is suitable to the local settings. Messages in posters ought to be explained to all concerned especially livestock farmers and traders by extension workers (VOs and AHOs) during distribution. Sensitization in addition to other initiatives like vaccinations, and quarantining should always be carried out when there are disease outbreaks.

We noted that MAAIF carried out sensitizations through conducting seminars and workshops involving the DVOs, VOs, AHOs and other district veterinary staff. It was however noted that posters were not hanged in some public places like community centres and abattoirs. Besides the messages in some of the posters was not clear and had not been explained to livestock farmers by the extension workers in all the districts during distribution. It was also established that the pre-testing of sensitization material in the districts was not extensive. In Kasese, sensitization materials were last received in April 2005, yet there were other disease outbreaks reported in May 2007, like the FMD outbreak in Lake Katwe Sub-county at Queen Elizabeth National Park.

Although the VOs of Mbarara, Rakai, Ntungamo and Kasese, stated that they carried out some sensitizations concurrently with the surveillance activities, there were no activity reports to corroborate this information.

Failure by the extension workers to explain the messages in posters was attributed to districts’ failure to prioritize the veterinary and entomological activities thereby allocating inadequate funds for extension services. Failure by MAAIF to develop adequate and appropriate sensitization materials and carryout extensive pre-testing in the districts was attributed to limited funding and conditionalities of the funding organizations who dictated which materials to procure and districts to target.

The weaknesses in sensitizations resulted in limited awareness in the prevention and control of livestock diseases by livestock farmers, cattle traders and local leaders.

5.2.6 Animal movement control

5.2.6.1 Enforcement of Veterinary regulations at Animal Check Points (ACPs) along NSR’s

MAAIF is required to operate Animal Check Points (ACPs) in high animal disease risk areas and along the NSRs. ACPs operated are strategic, mobile or fixed. ACPs are operated in order to inspect animals for health status, verify authenticity of movement permits and guarantee animal welfare standards. Only animals and livestock products inspected and scientifically proven to be disease and contaminant free are permitted to be moved. ACPs are required to have basic

infrastructure like sheds to be used as offices, road barriers, chairs, tables and nearby facilities like AHGs where suspect animals and animal products are withheld for investigation and appropriate action. Such facilities require security, water, feeds, disinfectants and animal health and storage facilities like crushes and dips.

We noted that MAAIF operated fixed ACPs in the districts of Soroti, Kasese, Rakai and Arua and mobile ones in Mukono, Mbarara, Kotido, Arua and Ntungamo. The district of Tororo did not operate ACPs. A part from Mukono, Kasese and Rakai, the rest of the districts neither had AHGs nor AQSs and therefore held impounded livestock in unsuitable places like police stations which lacked adequate water and pasture. The conditions in such places made the authorities to sometimes release impounded livestock before action could be taken against the culprits. We were informed that there was rampant movement of livestock by cattle traders during the night a long the NSRs when the ACPs are not operating.

Absence of ACPs in some districts was attributed to both MAAIF’s and districts’ failure to allocate sufficient funds for operating the ACPs. Lack of animal holding infrastructure was due to failure by districts to avail land with titles to MAAIF to be developed for AHGs and AQSs. Rampant movement of livestock during the night was mainly attributed to obsolete veterinary laws especially those regarding fines for defaulters, which were non deterrent and operation of ACPs only during the day.

5.2.6.2 Animal movement control at Border entry points

MAAIF is supposed to have at least one VO stationed at any border entry point to ensure legal importation and exportation of livestock and livestock products. The border entry points are also required to have nearby AHGs or AQSs for screening animals for pests and diseases before they are allowed into the country. Suspected animals are kept for a period of not less than 14 days for observation and testing.

We noted that only 4 out of 28 border entry points namely Entebbe International Airport, Malaba, Busia and Mutukula had VOs stationed and the rest did not. Of the four that had VOs, only Entebbe International Airport and Mutukula had AQSs.

The absence of VOs was attributed to shortage of qualified staff. Absence of AQS was due to failure by districts to avail land with titles to MAAIF to develop and equip as AHGs and AQSs.

Lack of VOs at some entry points enabled livestock farmers and cattle traders to move livestock in and out the country through the official border points without permit verifications and mandatory veterinary inspections. Lack of AHGs and or AQSs encouraged the entry of suspected animals into the country without isolating and holding them for a period of more than 14 days for the mandatory observation and testing for diseases.

It is worth noting that from 2003 to 2007 livestock and livestock products worth shs 95billion and shs29 billion were exported and imported respectively through Uganda’s border entry points. Malaba border point handled the bulk of exports with livestock and livestock products valued at shs 54billion during the period, although most of the livestock and livestock products exported were not processed, processed hides and skins accounted for most of the export revenue.

5.2.7 Coordination between MAAIF and the districts

Section 97 of the Local Government Act 1997 states that for the purposes of implementation of national policies and adherence to performance standard by Districts, line ministries shall inspect, monitor and where necessary offer technical advice, support supervision and training in their respective sectors. Section 98 requires a government line ministry to; a) Monitor and co-ordinate government initiatives and policies as they apply to Local Governments. b) Co-ordinate and advise persons and organizations in relation to projects involving direct relations with local governments; and c) Assist in the provision of technical assistance to local governments.

5.2.7.1 Implementation of Livestock activities at Districts It was was revealed from interviews with DVOs during audit that MAAIF did not have effective control over the DVOs with regard to implementation of MAAIF livestock programs and activities at the Districts. The DVOs further asserted that MAAIF does not offer adequate technical assistance, monitoring and supervision of activities carried out in the districts. DVOs cited failure to rehabilitate dip tanks; de-silt valley dams and tanks as examples of MAAIF’s failure to offer technical support. This was evidenced through field visits which confirmed the poor state of

livestock infrastructure. However audit noted that the cause of the poor coordination was attributed to the decentralization policy which placed the DVOs under the domain of the local governments. The DVOs report progress of their activities indirectly to MAAIF through the CAOs.

Poor coordination between the Districts and MAAIF has resulted in delays in vaccinations, diagnoses and disease information flow between the districts and MAAIF. It has further resulted in failure to rehabilitate dip tanks, de-silt valley dams and tanks.

5.2.7.2 Livestock census activities at districts

The greatest greatest concentration of cattle is found in the “cattle corridor” a semi stretch of land in South- Western Uganda through central to north eastern Uganda. Districts are required to provide annual estimates of livestock based on the counties and sub counties to MAAIF to act as a basis for planning, decision making and for making interventions on how to respond to disease outbreaks. It was noted that with the exception of Arua district all the districts did not provide annual estimates of livestock in counties and sub counties. Further more in years where census and annual estimates was carried out there was no consistency in carrying this out every year.

Interviews with the DVOs attributed the absence of annual estimates of livestock data to improper record keeping by livestock farmers, cultural beliefs by some livestock farmers that prohibit livestock from being counted, lack of cooperation because of the fear that the figures obtained will be used for taxation and hence they hide and under declare their livestock numbers, frequent disease outbreaks killing livestock and reducing their numbers, uncontrolled livestock movements, lack of physical (logistics in terms of efficient motorcycles and motor vehicles and funds to carry out annual census estimates and document the data. The absence of livestock data was corroborated with information in the epidemiological reports and data obtained from the districts. Absence of reliable annual livestock estimates has affected the provision of adequate vaccines, chemicals, livestock infrastructure and logistics to effectively manage livestock disease and improve livestock productivity.14

14 A national livestock census was carried out in Uganda in February 2008 results are not yet out.

5.2. 8 Collaboration between MAAIF and key stakeholders

5.2.8.1 NALIRRI This is the sole livestock resources research institute in the country mandated to carry out research on livestock diseases and technologies. It develops technologies for livestock management which are passed on to MAAIF for adoption and implementation. Some of the research programs planned by NALIRRI include vaccine development, disease strain isolation and research into determining the timing of vaccinations.

We noted that NALIRRI does not have the human resource expertise and technical facilities to develop vaccines for livestock disease strains prevalent in Uganda. This was due to limited development of the research institute over the years.

As a result MAAIF has continued to rely on the importation of vaccines and consequently failed to undertake routine strategic and adequate targeted vaccinations.

5.3.8.2 Uganda Wilde life Authority (UWA) Some epizootics attack both livestock and wildlife. Therefore wildlife disease surveillance must not be overlooked due to the vulnerability of adjacent livestock populations. Close cooperation is therefore required between veterinary and wildlife authorities.

In this regard, MAAIF signed a Memorandum of Understanding (MoU) under the PACE project, with UWA in March 2002 to collaborate on the control of and monitoring of Epizootic diseases. MAAIF was to encourage and facilitate involvement of UWA staff in PACE epidemiological surveillance work. All districts were to send summarized monthly disease surveillance reports to MAAIF within seven days of the end of the month, to be consolidated by MAAIF and sent to UWA. Emphasis of this surveillance was to be placed on Rinderpest, Rabies, CBPP and FMD diseases. The study revealed that sero surveillance in wildlife, involving UWA and MAAIF staff was carried out in all the major National Parks and wildlife reserves. However the surveillance of wildlife diseases focused on only Rinderpest.

We noted from the PACE 1st annual report that although MAAIF was expected to submit summarized disease surveillance reports from the districts, to UWA on quarterly basis, this was

not being complied with fully. Out of 627 filled formats expected by end of 2005, only 486 had been received at the epidemiology unit. This was an outturn of 77.5% compared to 72.4% in 2004. Failure by MAAIF to submit quarterly reports to UWA was affected by the delayed installation of the ARRIS (Animal Resources Research Information System) programme at the districts. Under this programme, computers were to be given to the districts to ease collection, collation and dissemination of disease information to MAAIF. However, the implementation of the programme got delayed due to insufficient training of PACE coordinators at the districts. This impacted negatively on MAAF’s ability to submit quarterly reports to UWA.

The failure by MAAIF to submit copies of summarized disease surveillance reports from all districts to UWA on a quarterly basis resulted in un-coordinated prevention and control activities between MAAIF and UWA. Besides focusing only on Rinderpest surveillance, increases the risk of spread of other diseases like Rabies, CBPP and FMD.

5.28.3 East African Community

Diseases do not know boundaries. OIE, WHO and FAO encourage collaboration between countries in order to enjoy benefits that can be derived when countries cooperate in livestock development activities including emergency livestock disease preparedness planning. Countries are expected to devise mechanisms for information sharing, joint research on transboundary diseases, coordinating emergency responses and where necessary implementing joint disease prevention and control programmes.

MAAIF has been collaborating with neighboring countries like Kenya, Tanzania and Rwanda in control of TADs. We noted that meetings were held between MAAIF and the neighbouring countries on a number of initiatives like the prevention and control of Rift Valley Fever, Rinderpest, and Avian Influenza.

A visit to Rakai and Ntungamo districts also confirmed the occurence of consultative meetings, between the leaders of the two districts and the local leaders of Rwanda and Tanzania. These meetings were held so as to control the outbreak of FMD in 2006. It was noted however, that these joint initiatives were carried out mainly when there were outbreaks of diseases.

Limited resources was the reason advanced by both MAAIF and the districts as to why the collaborative initiatives with neighboring countries were only carried out during disease outbreaks and not on a regular basis.

The effect of limited collaboration with neighboring countries has been the failure of MAAIF to obtain adequate reliable information on livestock diseases from neighboring countries thus affecting its timely response to disease out breaks originating from the borders of Uganda and spreading into the country.

5.2.9 Vector Control measures

5.2.9.1 Entomological Monitoring

MAAIF is mandated to carry out entomological monitoring and produce or update vector distribution and prevalence maps annually. Over the period covered by this report there was a bid to control tsetse flies which spread nagana and sleeping sickness.

MAAIF through FITCA project carried out a baseline survey in twelve districts of South Eastern Uganda to establish the levels of tsetse and disease challenge. The target of the project was to reduce the tsetse infestation by 75% in the designated high risk sub counties. 1040 parishes were tsetse surveyed in the district of (Busia, Kayunga, Mayunge, Mukono, Jinja, Iganga, Pallisa, Bugiri, Kamuli, Tororo, Mbale, Soroti). Out of the 1040 parishes 103 were graded high risk, 265 medium risk and 672 low risk.

After a risk analysis of parishes in the above districts which were tsetse surveyed using the flies per trap per day (FTD) as a measure, fixed monitoring sites (FMS) were established which were then followed by the deployment of tsetse traps in the high risk Sub counties. A total of 27,278 insecticide treated tsetse traps were subsequently deployed in 42 sub counties (22,520 pyramidal and 4,758 monoscreen) with an estimated area of 4158 sq km under trap deployment.

Traps originally deployed at start of FITCA selected districts

District No of No of No of No of sub Approximate community pyramidal monoscreen counties area under workers traps traps Under tsetse tsetse control deployed. deployed control (sq Km).

Mukono 18 2,310 0 3 213 Tororo 18 1,491 318 3 175 Source: FITCA Summary Final Report MAAIF

In the 12 districts which were identified as high risk a specific intervention called Farming in tsetse controlled areas (FITCA) project was designed to reduce the tsetse infestation by 75% in the designated high risk sub counties and monitor the tsetse flies in these districts. The FITCA districts were also required to submit monthly entomological monitoring reports to MAAIF

FITCA districts

We selected 3 FITCA districts out of the twelve namely Soroti, Tororo and Mukono for review and it was established that all of them submitted entomological monitoring reports to MAAIF. However we noted that the formats of these reports varied in the district of Soroti despite agreement by MAAIF and the districts to use agreed formats as Tsetse survey format and Entomological monitoring format during the field harmonization meetings.

Non FITCA districts

With the exception of Mbarara, Ntungamo, Lira and Arua, no entomological monitoring for tsetse is carried out in the districts. Only FITCA districts submitted monthly reports to MAAIF on vector and tsetse control activities with no evidence of reports submitted to MAAIF by the other districts. Meanwhile only Ntungamo compiled a report on entomological activities but the report remained at the district. It was also noted that there was lack of uniformity in the information submitted to MAAIF in accordance to the set standards.

The failure by Soroti district to submit harmonized reports on tsetse monitoring was due to failure by MAAIF to effectively supervise and monitor the agreed reporting format.

While for non FITCA districts Failure of entomological monitoring was mainly attributed to lack of staff in most districts and failure by the districts to prioritize entomology as an important activity and the existing system under decentralization were districts were supposed to buy their own logistics for Vector Control with no MAAIF support.

It was noted that MAAIF notified that any district which buys traps will be given insecticide to treat the traps but because of the low priority given by the districts the traps are rarely bought this has led to the resurgence of tsetse fly densities in some sub counties.

Lack of qualitative and timely information on vectors such as tsetse flies affects proper planning and delays interventions by MAAIF to reduce the tsetse infestation in the affected areas and prevention and control of trypanosomiasis in livestock

5.2.9.2 Vector control Measures in FITCA Districts

a) Fixed Monitoring Sites (FMS) and deployment Tsetse traps

A review of FITCA project work plans and annual reports and field visits to the districts of Mukono, Tororo and Soroti established that these vector control measures were successful in reducing the tsetse infestation and control of trypanosomiasis. Except for Soroti district, the tsetse traps deployed in the FMS ie Mukono and Tororo showed that tsetse population had reduced significantly. Mukono last deployed tsetse control traps in 2004 while Tororo had only 42 traps deployed at the time of audit this was attributed to the small district budgets to buy traps for the districts. Active trap deployment under FITCA ended in 2004 and local governments were supposed to carry on however this was observed not to have happened.

Status of FMS in FITCA districts District No Actual No of tsetse Current vector Affected high of no traps deployed control measures risk sub FMS Of In the field Undertaken by the counties. FMS district Soroti 23 30 *1,800 traps Tsetse trapping, Asuret, Kyere, spraying of livestock Kateta and Sensitization of Olio, Pingire and farmers Atiira Mukono 35 35 *No extensive Tsetse trapping, Najja , Ntenjeru deployment of new spraying of livestock and tsetse traps under and Sensitization of Wakisi FITCA since July farmers. 2004, but traps for entomological monitoring from the 35 sites were given. Tororo 33 33 *10 untreated Tsetse trapping, Osukuru, Iyolwa pyramidal traps spraying of livestock, and And 42 treated use of Live bait Rubongi traps treatment with flumethrin for tsetse Flies and ticks. *information obtained through field visits from district entomologists and reports. *The Local governments of the FITCA districts were supposed to expand on the activity of trap deployment and sustain successes by FITCA.. Source: OAG analysis of entomological data from districts and MAAIF

The actual number of FMS in the districts still remained the same as those initially established except for few additions by respective districts at the end of PHASE 1 of FITCA 27,873 traps were deployed in the region with 730 for Mukono,639 for Soroti and 1,491 for Tororo. b) Crush spraying and crushes In FITCA districts of Mukono, Tororo and Soroti cattle spraying associations were formed and these used acaricides of dual nature to spray livestock to control tsetse flies and ticks. It was again noted that because of poor management and lack of cohesion in the spraying associations their numbers had fallen significantly to 54%, 33% and 26% for Soroti ,Mukono and Tororo respectively.

Status of cattle spraying associations in selected FITCA districts District No of No of Percentage of No of crushes established existing active Crush spray Crush spray Crush spraying associations associations associations Soroti 28 15 54% No information availed Mukono 33 10 33% 17 Tororo 28 10 26% 22 Source: FITCA project MAAIF

ii) Vector control in Non FITCA districts

District entomological activities did not exist in Kasese, Kotido,Nakapirpirit, Rakai, Nakasongola, Gulu and Lira., except in Arua, Mbarara and Ntungamo on a limited scale.

Tsetse Traps

We noted that very few districts deployed tsetse traps in sub counties to make any serious impact on trapping of tsetse flies and other nuisance biting flies and most of these traps were not treated. The Majority of the districts did not deploy traps altogether. In Ntungamo the small number of untreated traps deployed in the field was attributed to limited number of traps in the stores, few trap attendants to monitor the traps and theft of traps deployed in the field. The district administration did not provide chemicals to treat traps nor did MAAIF send chemicals.

Non existent district entomological vector activities was attributed to lack of staff (entomologists and entomological assistants) in the districts, lack of prioritization and funding by the districts of entomological activities, and very limited support from MAAIF due to decentralization of vector control to the districts.

DVOs stated that they only carried out an advisory role of telling the livestock farmers to spray livestock using approved and recommended acaricides, the DVOs also encouraged livestock farmers to treat livestock with trypanomicides.

5.2.9.3 Vector control infrastructure i) Cattle dips and dip wash testing DVOs and MAAIF recommend regular dipping of livestock in dip tanks to control ticks and other nuisance biting flies. Dip wash testing for acaricide use by the districts is required once a year to establish the strength of the acaricdes and the results communicated to the DVO and MAAIF

The government function is limited to regulatory functions of inspections, monitoring and diagnosis of TBDs. MAAIF monitors tick resistance in acaricde use and conduct on spot checks on acaricides on the market to ensure that adultered and substandard products are not sold to unsuspecting livestock farmers.

Dip wash testing for acaricides was not being done in all the selected districts except in Rakai and Mbarara where decatix and supona respectively were tested for acaricide strength. Dip wash testing is carried out by companies supplying the acaricides to livestock farmers independently and not by the districts or MAAIF.

Dipping of livestock in dip tanks as a practice to kill off ticks and nuisance flies is no longer undertaken in most districts. The communal dips have either collapsed or are neglected except for private dips. Where livestock farming practice is not communal, livestock farmers owning private farms as in Mbarara, Ntungamo and Kasese spray livestock using bucket pumps to counter the none operational dips. The presence of many non functional dip tanks in the districts was attributed to failure by the districts to rehabilitate and maintain the communal dips. Meanwhile livestock farmers do not have adequate funds to operate private dips opting to use bucket pumps instead as an alternative.

Very few functional community based animal health workers (CBAHW) are available to monitor and maintain dips, private dips are very few except for in Mbarara district with 96 private dips in Kashari County 12 private dips in Rwampara County; The position of dips for the selected districts is shown in the table below;

Status of Communal and Private Dips District Communal dips Private dips Total Total Percentage Functional Non Functional Non Expected Actual % of actual dips functional dips functional Functional Functional Functional dips dips dips dips dips Ntungamo 0 46 3 13 62 3 4.8% Kasese 1 4 1 0 6 2 50% Tororo 0 11 2 8 21 2 9.5% Soroti 2 17 1 7 27 3 11.1% *Kotido 5 5 5 0 *Nakapiripirit 0 8 0 0 8 0 0 Arua 0 11 0 5 16 0 0 Nakasongola 0 0 7 0 7 7 100% Rakai 0 6 10 10 26 10 38.5% *Mukono Source: OAG analysis district data and interviews Note: *Kotido has 2 dips still under construction financed by NUSAF *Nakapiripirit two dips under construction. July 2007 epi report *Mukono all communal dips have broken down the current dips are private

A neglected Cattle Dip in Arapai Soroti district. December 2007

5.2.9.4 Registration and approval of acaricides by MAAIF Under the NDA statute, NDA is mandated to approve, authorize and regulate the type of acaricides to be imported and used in the country. This is done in collaboration with MAAIF through the commissioner and the Director General of National Agricultural Research Organization (NARO) to ensure that only safe and efficacious acaricides are registered.

Approval and registration of acaricides for use takes a long time. So far 19 candidate acaricides have been tested and recommended to MAAIF for use. Of these 6 are registered, 2 in the process of being registration and 9 pending registration.

Acaricides tested and recommended for use by MAAIF Acaricide Year tested Status Delays in registration Bayticol 2% pour -on 2001 Registered None Triatix 2001 Registered ” Ektoban 2001 Not Known ” Ecotic 2002 Registered ” Protaid 2002 Registered ” Cyperthion 2002 Registered ” Alfapor 2002 Registered ” Dominex 2003 In process of registration 5years Butox 2003 In process of registration 5years Delete 2003 Test results withheld due to 5years Non- payment of test fee Deltamethrin 10% EC 2005 Pending registration 3 years Alphacypermethrin 5% EC 2005 Pending registration 3 years Cypermethrin 10% EC 2005 Pending registration 3 years Paratryn 2005 Pending registration 3 years Paratraz 2005 Pending registration 3 years Alfacyp 2006 Pending registration 2 year Tickbuster 2006 Pending registration 2 year Deltatick Dip 2006 Pending registration 2 year Deltatick pour-on 2006 Pending registration 2 year Source: MAAIF

The acaricides Deltamethrin 1 %( Pour on), Deltamethrin 5 %( Dip/spray) and Tsetse tick have also been recommended for use by MAAIF. MAAIF is unable to effectively monitor, regulate and

enforce proper use of acaricides for vector control because the vector control section in MAAIF has only two officers a Principal entomologist and a senior entomologist for the whole country. This technical capacity is grossly inadequate for the whole country.

5.3 CONCLUSIONS

5.3.1 Surveillance

• Non, incomplete and/or late submission of epidemiological reports has impeded MAAIF‘s epidemiological unit from performing its role of providing up to date and timely information to the department and OIE. • Delays in carrying out diagnostic tests and communicating test results to affected districts led to increased risk of spread of livestock diseases due to delays in combating the disease.

5.3.2 Vaccinations • Lack of routine vaccinations of livestock in the country has resulted in loss of livestock through diseases which would otherwise have been prevented. • Delays in taking samples, diagnosing and communicating test results to the affected areas by MAAIF impacted on the timing and availing vaccines and delayed commencement of actual vaccinations. • Inadequate and delayed targeted vaccinations resulted in diseases spreading to surrounding areas there by risking more livestock to get infected. • Well-planned, comprehensive vaccination programmes, supplemented by other disease control measures, can go a long way towards controlling many epidemic livestock diseases.

5.3.3 Laboratory Diagnosis

Control of livestock diseases is extremely difficult and costly if suspected diseases are not quickly diagnosed and appropriate actions taken to either prevent outbreaks or spread. Given the inadequate capacity to diagnose livestock diseases at the districts, there is bound to be delayed confirmation of diseases, strains of causative agents and required vaccinations thereby leading to disease spread and possible loss of livestock.

5.3.4 Sensitisation

The limited pre testing of sensitization materials in the districts and inadequate sensitization materials developed by MAAIF contributed to limited knowledge and awareness of information on prevention and control of livestock diseases..

5.3.5 Animal movement control • Lack of basic infrastructure and AHGs with security, water, feeds, disinfectants and animal health facilities have abetted illegal movement of livestock. • Non availability of VOs in some border entry points coupled with the lack of AHGs and AQSs has made it difficult to isolate, observe and screen livestock for diseases during exports and imports. • Increased cross border trade heightens the risk of introducing livestock diseases.

5.3.6 Coordination between MAAIF and the Districts • Following the decentralization policy of government, MAAIF lost direct control over the Districts Veterinary activities, thereby making veterinary infrastructure that had been built neglected and out of use mainly due to lack of maintenance and no prioritization by the districts. • The poor state of livestock infrastructure (without adequate basic facilities in the districts like cattle dips, abattoirs and inadequate enforcement facilities as such AHGs, AQS and ACP) has greatly affected the extent to which the department has been able to effectively prevent and control livestock diseases. • Absence of accurate, reliable and timely data on livestock activities in the districts impedes effective decision making and planning by MAAIF in responding to livestock disease control • MAAIF’s inadequacy in monitoring and inspecting livestock activities in the districts resulted in delays in carrying out disease prevention and control activities as well as the dilapidation of livestock infrastructure.

5.3.7 Collaboration between MAAIF and key stakeholders

NALIRRI • Research in vaccine developments would go along way in easing the economic burden in vaccine procurements for some vaccines.

UWA • Inadequate surveillance activities between MAAIF and UWA increases the risk of spread of diseases from the game parks/reserves to livestock and vice versa. • Close collaboration between MAAIF and UWA is paramount in order to ensure effective prevention and control of spread of livestock diseases from the National parks to the surrounding communities and vice versa.

East African Community • Collaboration with neighboring countries eases the burden on all countries in the Community and results in harmonized plans and initiatives for prevention and control of animal disease emergencies in the region. • A regional approach to prevention and control of livestock diseases is more likely to succeed and it will reduce the subsequent risks for all countries to a greater extent than if countries acted independently. • A number of activities could be carried out in combination to prevent and control epidemic livestock diseases. The weight to be given to the different activities will be determined by the nature of the disease in question, the epidemiological circumstances and their acceptability and cost.

5.3.8 Vector Control • The existing manpower capacity for entomological monitoring in place at MAAIF is not adequate to address vector control in the Country. In addition the decentralization of entomological activities at the districts has not been effective in vector control.

5.4 RECOMMENDATIONS

We recommend the following to be carried out;

5.4.1 Surveillance i) MAAIF should identify methods of encouraging report submission and enforce the requirement by the districts to submit timely epidemiological reports monthly such that livestock disease information is effectively captured and analysed. ii) MAAIF should also make more effort in guiding and strengthening the DVOs in completing the epidemiological forms in addition to monitoring and supervision of VOs and AHOs at the lower local governments so that timely collection, collation and dispatch of all epidemiological data to districts is carried out. iii) MAAIF should liaise with the Ministry of Public Service so as to address the staff shortage at the department. iv) The department should continue with cross border surveillance which the PACE project had initially targeted.

5.4.2 Vaccinations

Routine strategic vaccinations i) Basing on a risk analysis MAAIF should identify areas prone to disease outbreaks and carry out routine strategic vaccinations. ii) MAAIF should also enter into contracts with vaccine manufactures to keep some vaccine stocks readily available for delivery following disease outbreaks. This arrangement has been used by some countries/ organisations and found to be effective. iii) MAAIF should make funds readily available for emergency procurement of vaccines following disease out breaks.

Targeted vaccinations iv) Emphasis should be put in timely collection of samples, diagnoses and communication of diagnostic test results to affected areas following disease outbreaks so as to ensure timely vaccinations. v) Build Buffer stocks of all types of vaccines to cater for unforeseen outbreaks of livestock diseases to enable adequate coverage during vaccinations. vi) Avail transport facilities to the districts to ease transportation and vaccine delivery to disease affected areas

5.4.3 Laboratory Diagnosis

National animal disease diagnostics laboratory. i) The laboratory should be fully equipped with reagents test kits and equipment to handle multiple disease diagnosis on samples collected during surveillance. ii) Address the staff shortage at the laboratory in order to ensure prompt diagnosis of livestock diseases and communication of test results.

Districts iii) Urge the districts to avail secure land with titles so that MAAIF builds laboratories and equips them adequately to perform basic diagnostic tests. iv) Fully equip the districts with sample collection kits for the common livestock diseases.

5.4.3 Sensitisation i) MAAIF in developing sensitization materials should increase the level of pre-testing to cover more districts and actively involve other stakeholders like local governments in order to ensure that the materials are suited to the local settings of the targeted groups. ii) MAAIF should also ensure that NAADS incorporates livestock health sensitization in the extension services.

5.4.5 Animal movement control i) Districts should be urged to avail land with titles to establish AHGs and AQSs for holding livestock impounded from ACPs and border entry points.

ii) Adequate funding should be availed by MAAIF to the districts to operate ACPs iii) Strengthen support to districts which do not have movement control infrastructure by providing facilities and equipment. iv) MAAIF should strengthen livestock and livestock products movement control systems at the border entry points by stationing VOs at each entry point to ensure legal exportation and importation of livestock. In addition all other illegal cross points should be regulated by all stakeholders with support from MAAIF and the Police. v) MAAIF should identify all the land of veterinary interest in the districts so as to secure land titles and lease offers for subsequent development of AHG and AQS.

5.4.6 Coordination between MAAIF and the districts MAAIF should; i) Strengthen inspection and monitoring of livestock disease initiatives and programs in the districts and improve coordination of livestock activities between MAAIF and the Districts. ii) Sensitize livestock farmers on record keeping of livestock data and empower DVOs to obtain annual estimates of livestock data to enable effective planning by MAAIF in prevention and control of livestock diseases.

5.4.7 Collaboration between MAAIF and Key stakeholders i) MAAIF in collaboration with NALIRRI should ensure that the research agenda at the livestock institute addresses National requirements. The inadequate technical staff and facilities for carrying out research should also be addressed. ii) MAAIF should speed up the training of district personnel meant to implement the IRIS programme so as to enable exchange of epidemiological information between UWA and MAAIF. iii) Following the eradication of Rinderpest, emphasis should forthwith be directed to other diseases as Rabies, FMD, CBPP, CCPP, RVF, LSD, PPR and ASF. iv) Closer collaboration at local and regional level should be encouraged with EAC and extended to other neighboring countries outside the East African Community such as Congo and Sudan.

5.4.8 Vector control

Entomological monitoring i) MAAIF should monitor all districts for entomological activities and come up with standard forms on entomological activities which should be reported upon by the districts. ii) Support the districts by availing them transport logistics as motorcycles for field staff and bicycles for trap attendants. iii) MAAIF should liaise with Districts and ensure that they prioritize veterinary and entomological activities by allocating adequate funds.

Vector control measures i) MAAIF should undertake a comprehensive review of the effectiveness and efficiency of vector control measures and their appropriateness to the local circumstances in the districts and where possible recentralize vector disease control. ii) MAAIF together with NARO and NDA should speed up the testing, approval and registration of acaricides. iii) There is need to strengthen the capacity of Nalirri to undertake acaricide tick resistance testing and confirmation. Vector control infrastructure i) Carry out a comprehensive review of the status of all vector control infrastructure in the districts in order to effectively plan how and where to provide technical and logistical support. ii) Enhance capacity of the entomological technical staff at the districts.

6.0 PROVISION OF WATER AND MAINTENANCE OF WATER FACILITIES IN DISTRICT LOCAL GOVERNMENTS BY THE DIRECTORATE OF WATER DEVELOPMENT, MINISTRY OF WATER AND ENVIRONMENT – (ISSUED MARCH 2009)

6.1 INTRODUCTION

6.1.1 Background to the Audit

This Performance audit on the Provision of Water and Maintenance of water facilities in rural areas by District Local Governments, has been conducted in accordance with Article 163 (3) of the Republic of Uganda, and section 21(1) of the National Audit Act 2008. The audit focused on the management of the Rural Water Supply and Sanitation programme in providing and maintaining water facilities in rural communities and to ascertain whether the programme has been effective in providing safe water to the rural communities.

6.1.2 Reasons for the Audit

Since the implementation of the Rural water supply sanitation programme in 1991, the government of Uganda, has spent a substantial amount of money in this area. For example, during the three (3) financial years from 2004/05 to 2006/07, an amount of 96 billion, was spent by the Ugandan government with support from Development partners, towards the provision of water and sanitation facilities in rural areas.

Despite these efforts, only 57% access to rural water supply was achieved in the year 2005 against the PEAP target of 65%, and 63% instead of 67% in the year 2007.

Improved access to water supply has two potential benefits; improved health and saving in time wasted collecting water. However there is increased concern that valuable time is still being spent by the rural community in walking long distances to collect water, instead of carrying out other productive activities such as farming.

It was also noted that the number of people served by one water source is more than 500 against the required target of 300 people. This audit was conducted to identify the major challenges to the programme and to make recommendations to address the bottlenecks.15

6.1.3 Description of the Audit Area

The Programme was first implemented in 1991, by the Ministry of Water and Environment through the Directorate of Water Development. Funding for the programme is in form Conditional grants from the Government of Uganda with support from Development partners.

The Rural Water and Sanitation programme is one of the services in the PEAP, under taken by the Government of Uganda. It is aimed at reducing poverty levels and increasing the standard of living of people living in rural areas. The target set by the PEAP was to provide sustainable safe water supply and sanitation facilities to 65% of the rural population by the year 2005 with an 80%-90% effective use and functionality of facilities. This was expected to eventually rise to 100% of the rural population by the 2015.

At the districts level, the grant is primarily used for hard and software activities. Hardware activities include, drilling and rehabilitation of deep boreholes, construction of shallow wells, spring protection, piped water schemes, Gravity flow schemes and Valley tanks. On the other hand Software activities include supervision and monitoring, training of water user committees and hand pump mechanics, community mobilization, water quality analysis among others.

6.1.4 Statutory Mandate

The Directorate Water Development operates under the Ministry of Water and Environment; its mandate is derived from the Constitution of Uganda 1995 (as amended), the Local Government Act 2000 and the Water Act 1995. The mandate requires the MWE to manage and develop the water resources of Uganda in an integrated and sustainable manner, in order to provide water of adequate quantity and quality for all social and economic needs for the present and future generations. 16

15 The Rural Water Supply and Sanitation operation Plan

16 The Local Government Act 1997 The water Act 1995

6.1.5 Activities The main activities of the Directorate of Water Development are; • Allocation of funds to various districts according to the work plans submitted, and in consultation with local government finance commission. • Capacity building in local governments through training of staff in various districts.17 • Providing technical support to the local governments through the Technical support units established in various regions.

6.1.6 Financing

The Rural water supply and sanitation programme is financed under the Poverty Alleviation Fund (PAF). The programme is a comprehensive strategy for poverty eradication through implementation of water projects in the rural areas. Funding for this programme is in form of conditional grants released to districts on quarterly basis by the MOFPED. In order to achieve the objective of poverty alleviation Government has injected over 96 billion towards this activity in the last 3 years.

District Water and Sanitation Conditional Grant

Financial Year Amount (shillings) 2004/2005 27,956,307,000 2005/2006 27,646,383,000 2006/2007 40,659,970,917 Total 96,262,660,917

Source: OAG analysis from MoFPED data on release of funds.

6.1.7 Audit scope

This Audit report focuses on provision of water and maintenance of water facilities, by the RWSS programme under Directorate of Water Development in the Ministry of water and Environment.

The RWSS operation Plan –OP5 17 Ministerial Policy statement 2006/07

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The period audited covered 1st July 2004 to 30th June 2007.

Ten (10) out of Eighty two (82) Districts in Uganda were sampled for the Audit. The districts include; Arua and Nebbi in the West Nile region, Gulu and Lira in the Northern Region; Masaka and Luwero in the central region; and Mbarara and Hoima in the western region.

6.1.8 Audit methodology:

The audit was conducted in accordance with International Organization of Supreme Audit Institutions standards. Those standards require that performance audit should be planned, conducted and reported on in a manner, which ensures that an audit of high quality is carried out in an economic, efficient and effective way and in a timely manner.

The following were the data collection methods used. Interviews Document Review and Physical Inspection.

6.2 FINDINGS OF THE AUDIT.

Since its inception in 1991, the Rural Water Supply and Sanitation Programme has made significant achievements in providing rural communities with improved water sources. The rural water coverage has increased from 20% in 1991 to 61% in 2005 and to 63% in 2007. The Programme aims at attaining the national target of 100% rural water coverage by 2015. However challenges still exist that need to be addressed. Below are some of the Challenges.

6.2.1 Disbursement of conditional grants.

The water and sanitation sector guidelines require the release of funds to the District for the quarter to be made by the 5th day of the first month of the quarter. The District water Officers are supposed to submit quarterly reports to the line Ministry by 30th of the month ending the quarter.

We noted that release of the Conditional grants to the districts is not done by the 5th day of the first month of the quarter, but it is done on average 6 weeks after that date.

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The District water offices also submit their quarterly progress reports to the DWD and MoFPED, on average 3 weeks after the end of the quarter.

The delays by DLG’s to meet deadlines of submission of quarterly reports have made it difficult for the Directorate of Water Development and the Ministry of Finance, Planning and Economic Development to make timely review of quarterly progress reports, allocation and release of conditional grants.

This affects the timely implementation of planned activities. In the period under audit on average 68% of planned construction was complete leaving 32% uncompleted, as shown in the analysis below;

Incomplete construction work

Construction of water facilities

300

250

200 Planned 150 Actual 100 the 4th quarter 50

Number of water Facilities in in Facilities water of Number 0 2004/05 2005/06 2006/07

Financial Year

Source: Quarterly Progress Reports

6.2.2 Functionality of Water Facilities.

The National framework for operation and maintenance of Rural water supplies defines a functional water source as a protected water source that is found producing water at the time of spot check. Districts are responsible for ensuring that there is long-term sustainability of water

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facilities constructed, implying that water facilities should be functioning for use by the communities at all times. The National percentage target for functionality is between 80% to 90%.

Our findings indicate that out of the one hundred and forty four (144) water facilities inspected, sixty five(65) water points were non-functional, the overall functionality percentage stood at 55%.

The highest number of non-functionality were found in shallow wells and Bore-Holes. Interviews with local leaders and communities reveal that after breakdowns, facilities are abandoned or remain unrepaired for an average of twelve (12) months. Meanwhile, The Gravity flow schemes inspected were functioning well except in Mbarara and Nebbi where five taps were not functioning. The Districts of Nebbi, Gulu and katakwi had the highest number of non- functional water facilities. Detailed in the table below;

Non- functional water facilities

District No. of water Number of Non- Functionality facilities functional Percentages (%) Visited Water facilities Soroti 20 8 60 Katakwi 25 13 48 Mbarara 13 6 54 Gulu 15 8 47 Lira 15 7 54 Masaka 10 4 60 Hoima 12 5 59 Luwero 13 4 70 Nebbi 11 6 46 Arua 10 4 60 Total 144 65 55

Source: OAG Analysis of field inspections

Audit findings revealed that functionality of water facilities is between 50% - 60% which is below the percentage target of 80% to 90%.

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While the Water and Sanitation Performance Report 2007, indicates the following factors, as affecting functionality of rural water sources; Poor Siting and Quality of Construction Lack of Policy to regulate Shallow well contractors Technology choice not appropriate. Loopholes in Community Based Maintenance System(CBMS) Policy.

Audit findings reveal that Out of the one hundred and forty four (144) water facilities inspected, Sixty five(65) were non-functional, out of which 35% were non functional because communities could not carry out minor repairs, 15% were due to lack of major repairs by District Authorities, 20% due to unavailability of spares while poor quality construction work constituted 30%. (See graph below);

Factors affecting Functionality of Water Sources

Functionality of Water Facilities

30% 35%

20% 15%

N.F due to minor repairs N.F due to major repairs Un availability of pump Spares Poor Quality Construction Work

Source: OAG Analysis of Field Inspections

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6.2.2.1 Water User Committees.

According to the water statute 1995 Section 50 (1), - A set of individuals or Households forms a water user group and collectively plans and manages a water point source in their area. A Water User Group(WUC) comprising of nine members, is expected to collect revenue from persons using the water supply system for the maintenance of the system and the tariffs to be collected under this section are set with the approval of the director.

The water user group or committee formed is expected to meet once a month with members of the community to discuss how to plan for new water sources, mobilize community cash contributions, and report cases of water facility breakdowns to District Authorities.

Interviews conducted at the districts visited revealed that out of the 144 water points visited, 23 water facilities did not have WUCs. And yet at the time of completion and handover of the water source to the communities, WUCs constituting of nine (9) members were supposed to be formed and trained.

Findings also indicate that, out of one hundred and forty four(144) water sources visited, thirteen (13) had all nine (9) members, while one hundred and eight(108) water facilities visited did not have all nine (9) members constituting the water user committee, the water sources had an average of only three(3) members, making it difficult for WUCs to manage water points. Members of water user committees and caretakers for water sources expect payment for their services from the district authorities, absence of the remuneration has hindered WUC members from performing their duties.

Interviews carried out in the communities, indicates that out of one hundred and twenty one(121) WUCs formed ninety five (95) committees do not hold meetings at all, twenty six(26) committees hold meetings once in six(6) months on average to discuss matters regarding, collection of cash contributions when a facility has broken down. However, minutes of the meetings were not available in the districts visited. Lack of sense of ownership has hindered water user communities from holding meetings.

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Findings indicate that out of the one hundred and forty four (144) water sources visited, 80% of the communities did not have evidence of making cash contributions. It was noted that, community members are not committed towards making cash contribution.

Interviews carried out with members of the communities in the districts visited, shows that 75% of the water users were not involved in planning for new water sources in their area, this has led to lack of ownership of facilities by the communities.

Inadequate involvement of community members in planning for new water sources, lack of adequate sensitization and follow up by district officials has led to inactive Water user committees making it difficult for community members to report cases of facility breakdown in case of major repairs or mobilize cash contributions towards minor repairs of water facilities.

Below is a photograph of an abandoned shallow well in one of districts visited.

An abandoned non functional shallow well in Amach sub county Lira district, inspected on 22.11.2007, 2:00 pm. Source: OAG Field inspection

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6.2.2.2 Supervision and Monitoring of Water Facilities.

According to the National framework for operation and maintenance of Rural water supplies, the District water officer has a responsibility of ensuring, long-term sustainability of water facilities constructed and to monitor their performance on operation and maintenance, taking remedial actions to address shortcomings. Supervision is supposed to be on quarterly basis.

Interviews with water user communities and local leaders of areas visited, revealed that supervision and monitoring carried out by the water department staff is not done on quarterly basis. This was confirmed by the supervision and monitoring reports in the ten (10) districts visited, which indicated that four(4) out of ten(10) District water officers carry out supervision and monitoring on average, twice a year(12) months, instead of once a quarter (3) months.

The failure to carry out quarterly supervision and monitoring is attributed to the staffing gaps in District Water Departments.

Inadequate quarterly supervision and monitoring by district water officers has made it difficult for the DLGs to get information on the status of water facilities to enable immediate corrective action, including carrying out major repairs of broken down water facilities.

6.2.2.3 Availability of Hand Pump Spares

The Directorate of water development, initiated a supply chain system in 2004, designed to enable private sector suppliers to be awarded contracts by government to supply hand pumps. In turn these suppliers were to set up outlets through out the country, in order to avail pump spares to rural communities at affordable prices.

Thirty seven (37) hand pumps spares outlets were opened in four regions in the country, by private suppliers to avail hand pump spares to rural communities at subsidized prices.

At the time of audit, we noted that out of 37 out lets opened only four(4) outlets in the regions remained operational, as shown in the table below;

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Pump Spare Out Lets

Region Supplier Out lets Opened Operational up in 2004 Out Lets Eastern Uganda Victoria Pumps Ltd 13 3 Northern Uganda Victoria Pumps Ltd 13 0 Central Uganda Buyaya Technical Services Ltd 4 1

Western Uganda Multiple Industries Ltd 7 0 Total 37 4

Source: OAG Analysis of Field Inspection.

Insurgency in northern Uganda, caused outlets that had opened in the districts to close. In the central region challenges were faced in dealing with unreliable Agents and stiff competition from bigger firms. In Western Uganda the initiative was hampered by low demand resulting from construction of GFS systems and protected springs.

Consequently, failure to provide subsidized pump spares in rural areas has led to many water facilities being left un-repaired, since pump spares on the market are very expensive, and the rural communities cannot afford to buy them.

6.2.3 Monitoring and Supervision of Work Under Construction.

According to the District Implementation Manual, the District water officer is responsible for technical Supervision and to ensure the contractor complies with the provisions of the contract. Technical supervision is done as per schedule of contract work. She/he should also review on a monthly basis the contractors status report and carry out critical analysis of construction work.

Inspection of water facilities revealed that out of one hundred and forty (144) water facilities visited 40% of water facilities visited were not adequately supervised during construction, Thirty seven (37) water facilities had cracked platforms, eight (8) had pedestals that were not firmly installed and Thirteen(13) water facilities had dried up after months of producing water.

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Interviews with local leaders and communities, further revealed that during construction, supervision by District water staff is not done per stage of work.

Audit findings also reveal that District water Officers did not have reports regarding technical monitoring and supervision of water facilities under construction. Out of the ten (10) districts visited, only two (2) districts had reports showing critical analysis of construction work under progress.

Verification of the relevant documents revealed that reports by consultants hired to supervise and monitor construction of deep boreholes were available. The districts also had final inspection forms attached to the payment certificate of completion, which describe the water facility after construction but not during construction.

The inadequate monitoring and Supervision of water facilities under construction is attributed to the low staffing levels in the District water departments.

It was also noted that Technical support units established in various regions of the country, carry out capacity building for staff in district water departments. These units according to the Rural Water and Sanitation Operational Plan2002-2007,are supposed to support DLGs fulfill their Water Supply and Sanitation mandate, through capacity building of staff in the water departments and offer technical advice to the water officers where necessary. The TSUs are expected to prepare monthly monitoring reports and submit them to DWD. However a sample of thirty(36) monthly monitoring reports prepared by the units, Indicates that six(6) of the monitoring had issues pertaining to supervision of water facilities under construction, implying that support by TSUs on technical monitoring of facilities under construction is not effective.

The Water and sanitation sector guidelines, requires a fully fledged Water Department in a DLG, comprising 1 DWO with a minimum degree, plus 3 years experience.1 Senior Engineer / Senior water Officer,1 Hygiene education / sanitation officer,1 Assistant DWO mobilization 1 Technical Officer (minimum Diploma in water engineering) in each county and1 Borehole maintenance supervisor.

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Out of the ten districts visited, none of them had the number of staff as required by the Water Sector Guidelines, with a staffing gap of 60% on average.

Due to the staffing gap, staff in the water departments are not effective in meeting their responsibilities. The unfilled vacancies were mainly for District water Officers and water county officers. See table below;

Staffing Position in Water Departments

District Required Actual Vacancies not Percentage(%) number of number of filled of Staffing gap staff staff

Gulu 6 2 4 60 Lira 6 3 3 50 Arua 6 3 3 30 Soroti 6 2 4 60 Katakwi 6 2 4 60 Luwero 6 3 3 50 Masaka 6 3 3 50 Mbarara 6 2 4 60 Hoima 6 3 3 50 Nebbi 6 3 3 50 Total 60 26 34 60

Source: OAG Analysis of Staff List at DWO’s and quarterly progress reports.

Because supervision and monitoring of construction work on water facilities is not adequate, it has resulted to poor quality construction work, leading to water scarcity in rural areas, due to facility break down.

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6.3 CONCLUSIONS

From the audit findings above, the following conclusions have been made to highlight observations made from the audit.

6.3.1 Transfer of funds. Late disbursement of funds, means that annual work plans can not be implemented on time, while planned construction of water facilities are delayed, consequently limiting the facilities in place and water coverage in those periods

6.3.2 Functionality of Water Facilities. Non- functional water facilities, implies that a number of water facilities constructed are not being used by the communities, resulting into inadequate water supply in rural arrears

6.3.3 Monitoring and Supervision

The inadequate monitoring and supervision of facilities under construction, implies non detection of poor quality construction work of water facilities, consequently affecting the ability of a facility to function for a long period of time. Hence, inadequate water supply in rural areas.

6.4 RECOMMENDATIONS

In light of the above findings and conclusions the following recommendations have been made, to sustain and improve upon the achievements of the Rural Water Supply and Sanitation Programme.

6.4.1 Monitoring and Supervision

It is recommended that the Directorate water Development strengthens monitoring and supervision of the implementation of the RWSS Programme. TSUs should increase efforts in carrying out support supervision and monitoring of DLG’s, by providing technical advice on supervision of water facilities under construction.

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The District should ensure that water office departments carry out frequent and effective Supervision and monitoring of water facilities during and after construction. DWOs should produce technical evaluation reports of work in progress. Both district and sub- county officials should be involved in carrying out post construction monitoring. Standard forms or checklists with third party confirmations from WUCs, LC 1 office, or sub county chiefs office should also be developed and used during the supervision and monitoring.

6.4.2 Staffing

District local governments should ensure that vacancies in the water departments are all filled as required by the water sector guidelines and staffing structures set by the District service commissions. This is to ensure effective implementation of activities in the district water departments.

6.4.3 Submission of Quarterly Reports

It is recommended that the Directorate of Water Development through districts institutes measures to ensure that DWO’ s make timely submission of quarterly reports so as to speed up the review of work plans and transfer of funds.

6.4.4 Water User Committees

The Directorate of water Development through district local governments should strengthen the community based maintenance systems in place. Rural communities should be continuously mobilized and sensitized on their responsibilities regarding O&M. frequent Follow up visits should be made to the water user committees that have been formed.

There is need for involvement of community members in the planning and implementation of the water project. DWD through the district local governments should emphasize the need for communities to make an initial capital contribution towards construction of a facility. This would in turn motivate the community to own the facility and makes it easy for them to contribute towards its operation and maintenance.

6.4.5 Hand Pump Spares The MWE/DWD should re-design the supply Chain System to address the weaknesses of phase one of the supply chain. Reliable suppliers/agents should set up outlets through out the country

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and in the relatively peaceful districts in the Northern regions of the country. District Local Governments should also utilize the suppliers in providing spares for rehabilitation of existing facilities so as to increase demand and keep the Agents in business.

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7.0 UGANDA AIDS CONTROL PROJECT (ISSUED OCTOBER 2007)

7.1 INTRODUCTION

7.1.1 Background to the Audit

Reducing the prevalence of HIV/AIDS is a high priority for the Government of Uganda as defined in the National Strategic Framework (NSF) 2000/2001-2005/2006. The leading agency in the fight against HIV/AIDS is the Multi country AIDS Project (MAP).

MAP was designed to support the operationalization of the NSF specifically meant to increase the national response. It implements a set of interventions with funding from the World Bank. The Uganda AIDS Control Project is a Government project, which aims at meeting the goals of the National Strategic Framework for HIV/AIDS. This study was undertaken to assess the effectiveness of the Uganda AIDS Control Project (UACP) in achieving its goals of combating the economic and social erosion by HIV/AIDS.

7.1.2 Motivation

HIV/AIDS is a major public health problem in Uganda. The most affected population is the reproductive age group of 15 – 49 years. Since the 1990s, HIV/AIDS has slowly but progressively attained alarming levels and the pandemic at one point registered an average prevalence rate of 30%. Due to focused interventions the AIDS prevalence rate had reduced to 6% by 2000. This was through a multi-sectoral and multi-disciplinary approach supported by both civic and political commitment. However, since 2000 the AIDS prevalence stagnated at 6% until 2004 when it rose to 7% as shown in the graph below:

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National Prevalence of HIV in Uganda

10 Series1

5 HIV Prevalence (%) 0 1992 1994 1996 1998 2000 2002 2004 2006 Years

Source: MOH

Over the years, HIV/AIDS has eroded and continues to erode not only the human and social economic development but also national productivity. Uganda experiences a 0.8% loss to GDP annually due to death from AIDS. About one million (1,000,000) people are estimated to be living with HIV/AIDS while eight hundred forty thousand (840,000) have died. The cumulative number of orphans due to AIDS in Uganda is about two million (2,000,000). The UACP has been at the centre of mitigating the effects of the pandemic. From July 2001 to September 2005, a total of US$ 48.6 million was spent on HIV/AIDS activities by the Uganda HIV/AIDS Control Project. However, complaints have arisen from the public regarding poor dissemination of information about HIV/AIDS, lack of condoms in most areas, poor facilities for VCT and untrained health workers in VCT in many HCs.

It is alleged that the UACP campaign on prevention and behavioral change has not been effective; many people have not accessed the IEC messages and the facilities for VCT and PMTCT. This value for money audit was conducted to establish the reasons why and to recommend appropriate measures on how improvements can be made.

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7.1.3 Design of the audit

7.1.3.1 Scope This audit was conducted on the activities of UAC with focus on UACP. The study focused on the economy and efficiency with which the agencies utilized the funds that they received and their impact on the timely achievement of reducing prevalence by 25%.

7.1.3.2 Time scope The study covers the period from July 2001 when project activities commenced to June 2006.

7.1.3.3 Geographical scope The study was carried out in (11) districts randomly selected from each of the four regions of Uganda. Districts selected in each region are as follows;

Central Region East Region West Region North Region Mukono Mbale Kabarole Lira Masaka Soroti Hoima Arua Kampala Mbarara Nakapiripirit

7.1.4 Audit Objective The aim of the audit was to assess the economy, efficiency and the effectiveness of the UACP's preventive and behavioral change campaign as well the impact it has had on the reduction of AIDS prevalence. As a result of the audit, recommendations have been made which may be considered to improve on the efficient and effective delivery of service in this area.

7.1.5 Audit methods This audit was carried out in accordance with the INTOSAI auditing standards and guidelines. We are required by the standards to plan the audit and report on the economy and efficiency with which resources are acquired and used, and the effectiveness with which objectives are met.

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The audit methods employed included interviewing various stakeholders, reviewing documents at the project office and at the implementing agencies and physical inspection of facilities at the districts to assess compliance with national guidelines.

7.1.6 Description of the audit objective UACP supports the goals of NSF for HIV/AIDS and is the biggest government project in this area. It is a multi-Disciplinary and Multi-Sectoral project. UACP was a five year project which was commissioned in May 2001 and commenced operations in July 2001.Guided by the multi sectoral and decentralization policies, UACP sought to increase the response to the HIV/AIDS epidemic by supporting line ministries, Faith based organizations (FBOs), Civil society Organizations (CSOs), District local Governments and communities and implementing interventions relevant to their mandates and in line with the objectives.

7.1.7 Statutory Mandate. UAC was established by statute No. 2 of 1992, UACP on the other hand is a project under the UAC. An agreement was signed on 15th February 2001 between the Republic of Uganda and the International Development Association (IDA) for SDR 37.3million equivalent to US $ 47.5million to support HIV/AIDS related activities. UACP is the implementing agency of UAC under this program. The project is part of the Multi country HIV/AIDS program for Africa region.

7.1.8 Activities To achieve the above goals the UACP carries out the following activities • Institutional capacity building • Community mobilization • Appraisal and Approval of community proposals • Training • Program management, monitoring and evaluation

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7.1.9 Financing Total funding for the project for a five year term (July 2001 to June 2006) was US $50 million of which IDA financing was US $ 47.5 Million while GOU counterpart funding was US $ 2.5 Million. As at 30th Sept 2005, arising from an appreciation of SDR against US dollar a cumulative exchange gain of US $ 4.5 Million was realized. The total expenditure on project activities as at 30th September 2005 was $US 48.6M.

7.2 FINDINGS

This chapter presents the audit findings. The findings relate to;

Disbursement of funds, Access to IEC messages, Availability and adequacy of HCT and PMTCT facilities, Compliance with HIV/AIDS national guidelines on facilities, and Sufficiency of trained health workers in HIV/AIDS counseling.

7.2.1 Disbursement of funds

Replenishments to the special account (PMR basis) are expected to be made quarterly based on project management reports that integrate project accounting, procurement, contract management, disbursement and audit with physical progress of project implementation. Replenishments are made under two different arrangements. Those made on the basis of SOE method, are made for specific defined expenditure items and ceilings and are supported by SOE forms as the only supporting documentation. On the other hand, replenishments under the direct payments method are made against withdrawal applications which are accompanied by relevant supporting documents such as copies of the contract, contractor’s invoices and appropriate certifications. Funds are disbursed by the project to the district for both the district initiative and the sub projects which include the CSOs and CHAIs. The districts then disburse to the CSOs and CHAIs as specified in each release.

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7.2.1.1 Disbursements to the Special Account

It was noted that total disbursements to the special account during the period were expected to be US $ 53,062,227.09 comprising of; Initial deposit, Replenishments, Special Commitments and Direct payments. Out of this sum however, withdrawal applications totaling to US$ 5,292,392.96 had not been credited to the special account by 30th June 2006. Besides, there was an unspent balance on the account of US$ 3,276,062.78, implying that a total sum of US$ 8,568,455.74 was not disbursed to the implementers during the project period. This was attributed to delay in disbursing funds to the project which eventually resulted into extending the project term by six months.

7.2.1.2 Disbursement to districts Release of funds by the project to recipient districts is normally done every quarter in the first month of the quarter. However, it was noted that many times most disbursements to the Districts for the District initiative delay by more than 9 months as shown in Table II below.

District No. of Delay in disbursing of funds ( No. of disbursements disbursements Delayed) 1-3 Mths 3-6 Mths 6-9 Mths 9-12 Mths More than 12 months Lira 20 2 5 2 1 1 Hoima 12 3 1 2 2 2 Arua 18 4 3 2 1 2 Mbale 21 5 3 1 2 2 Soroti 15 2 1 1 1 1 Masaka 21 4 3 4 1 2 Mukono 19 2 1 1 3 2 Mbarara 13 2 1 2 1 0 Kabarole 12 3 1 2 1 1 Nakapiripirit 1 1 3 1 1

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The delay is attributed to, among other reasons inadequate monitoring and supervision by the project monitoring unit. The staffing of the project monitoring unit is thin comprising only one internal auditor, who cannot regularly visit the districts and other implementing agencies to ensure that they implement their activities and submit their accounts timely.

The district focal persons in charge of the project operations in the district are usually transferred without the knowledge of the project coordination unit and transfers among the accountants handling project funds in the districts are frequent. Some accountants are transferred soon after training in handling project funds before the project benefits from the training. These factors also contribute to delayed implementation of project activities in the districts.

7.2.1.3 Disbursements to implementing CHAIs

Districts are expected to disburse funds to CHAIs in two equal annual instalments. The first instalment is made in the first quarter of the year and the second instalment is expected to be made in the third quarter but after submission of accountability for at least 30% of the first instalment.

We noted that on average more than 50% of the approved CHAI work plans in the districts were partly funded as a result of delays in disbursement of funds.

We established that the delays in disbursement of funds were caused by the delay in submission of accountabilities by the implementing agencies. CHAIs lack qualified personnel to compile and submit their accounts on time.

According to the DFPs, some CHAIs that were partly funded were unable to utilize the first instalments within the first period of the year and as a result the second release could not be made within that year. This could probably have been caused by inadequate supervision and monitoring of CHAIs by the districts as well as by the project. In districts like Masaka and Mukono, the number of CHAIs was very big which made supervision and monitoring all of them very difficult.

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Delayed disbursements have resulted in planned activities not being implemented on time. Activities, especially those involving sensitization and behavioral change communication targeting students were greatly affected by delayed disbursements. Example in Mukono district, delayed disbursements affected schools sensitization programs. Funds were disbursed after the school terms had closed and when the targeted students had left for holidays. This meant that fresh programs had to be drawn up at an extra cost.

Delay in implementing project activities results into more administrative costs to the project. The UACP was supposed to wind up its activities on 30th June, 2006, however the closure was postponed to December 2006. As a result extra administrative costs were incurred for the extra 6 months by the project. The extra administrative expenses reduce funds available for budgeted activities which in the end are not implemented. The delay in implementing some activities affects the objectives of the project.

7.2.2 IEC materials

The national guidelines on HIV/AIDS prevention require all people between the ages of 15 to 59 to have access to information on prevention. To achieve this, the project is expected to support key activities necessary to lead to an expected behavioral change, and these are:- i) Development and dissemination of a multi-sectoral Behavior Change communication strategy. ii) Production, translation and distribution of HIV/AIDS information flip chart to districts/line ministries/national, CSO/Secondary schools. iii) Community AIDS education through CHAIs.

7.2.2.1 Posters

It was noted that in 80% of the districts, many HCs did not have posters with HIV/AIDS prevention messages in strategic places. Out of the 12 districts visited, only the HCs in Mukono and Mbarara districts had posters strategically placed for clients to see both in English

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and the local languages. Of the HC IIIs and IVs inspected in the remaining districts, only Oli HC III in Arua district had a poster in English which had been financed by the project. There were no posters in the local language, Lugbara. 80% of the HCs did not have any posters.

Examples of posters in English and Luganda at one HC

Effective monitoring by the project implementation would have identified lack of posters in strategic places and directed effort thereto. The project did not make sufficient provision to ensure that posters are availed to all strategic places where people could read them and access the messages.

7.2.2.2 Flip Charts

It was observed that although the districts have translated and produced materials such as flip charts for communicating the IEC messages, 40% of the districts had not distributed these materials to the users. In the districts visited, it was noted that over 60% of them did not have trained community educators to pass the messages across to the people. This is attributed to poor planning. For instance in Mukono district the reason for not distributing flip charts was that distribution costs were not budgeted for, hence funds were not available to finance distribution. As a result, the IEC messages do not reach the intended audience and this has greatly affected the campaigns in the prevention of HIV/AIDS.

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7.2.2.3 Drama shows It was noted that drama shows are used mostly during VCT outreaches. These are organized by the HCs especially at the health sub-district level. The CHAIs that carry out sensitization through plays facilitate during such out reaches. It is therefore expected that districts would provide these groups with IEC materials to assist them to focus the plays on BCC. Statistics, however, show that in all the districts, the highest numbers for VCT were recorded during the out reaches. People’s responses after the shows towards VCT were very positive.

7.2.3 HCT and PMTCT infrastructure

The national guidelines on HIV/AIDS require that all health facilities from HC III to National Referral Hospitals have VCT/HCT and PMTCT facilities. It was noted that out of the 104 HCs inspected, only 47% have HCT facilities. This is quite low, meaning that the people who are sensitized and want to access the facilities to establish their sero status cannot access them. The project has funded a few HCs with facilities such as buildings for counseling and laboratories while the remaining HCs still provide these services in the existing structures.

A building for HCT that was constructed through funding by UACP in Mukono District

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As seen in the Graph below the district with the highest percentage of HCT facilities is Lira with almost 90% and the lowest is Arua with 15%.

HCs with HCT Facilities

100 90 80

70 60 50 40 30 20 10 0

%age HCT services %age HCT services of HCs III & above Lira % of Hoima Arua Soroti Mbale Mukono Mbarara Kabarole Health centers District with HCT

This was due to little coordination between the project management and the district to ensure that the HCs III and IV are equipped with these facilities.

Inadequate HCT services greatly affected the preventional campaigns as these were expected to be the immediate action points following sensitization. People are motivated to protect themselves from infection once they are sure of their sero status.

7.2.3.1 PMTCT Facilities The project’s aim is to provide PMTCT facilities at HCs III and IV that offer maternity services to target mothers who come for ante natal so that they can be counseled, tested and if found positive, PMTCT administered to them to ensure that the un-born child is protected from infection. We noted that about 70% of the HCs did not have PMTCT facilities arising from little coordination between the project management and the districts in ensuring that the HCs III and IV are equipped with the required facilities. At HC, where PMTCT services are not available, infected mothers are not informed of how to avoid transmitting HIV/AIDS to their unborn children. The aim for the requirement for all HC offering maternity services to have PMTCT services is therefore not achieved.

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7.2.3.2 Testing Kits It was noted that some of the HCs that offer these services are plagued by frequent run-out of testing kits. All the HCs visited had experienced an average of one month testing kits stock out. The anomaly is attributed to little coordination between the project management and the district in ensuring that the HCs III and IV are equipped with the required facilities.

7.2.4 Training of health workers in HIV/AIDS The National guidelines on HCT require all health workers to be trained in VCT and PMTCT. HCT providers are expected to have training of at least 2 weeks of classroom instruction and 1 week of practical experience and must regularly update their knowledge. Non medical HCT providers are expected to receive 24 hours of refresher training per year. All HCT providers are required to complete 3 months of supervised practice with endorsement by a counselor supervisor.

HCs that offer maternity services should be able to provide PMTCT services as well, hence should have trained health workers in PMTCT.

7.2.4.1 Health Workers Trained in PMTCT

It was noted that on average only 21% of health workers in HCs III and above in the districts are trained in PMTCT. This implies that 79% of the health workers cannot effectively carry out counseling of mothers that attend PMTCT and assist to prevent the un-born child from being infected by the mother.

As seen in graph III below, the percentage of health workers trained in PMTCT is highest in Mbarara District which is still below 50% and lowest in Arua district which is slightly above 5%.

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Health Workers Trained in PMTCT in District HCs & 60

30 above 20

0 %ge trained of total in HC III HC trained total of in %ge a a le o le %age of m ir n L o oi Arua health H Soroti Mba uko barara bar M M Ka workers District trained in PMTCT

7.2.4.2 Health workers trained in VCT

Evidence from the HCs visited revealed that about 20.2% of health workers in the districts are trained in VCT. As seen from graph IV, Mbarara district had the highest percentage of health workers trained in VCT which is slightly above 40% and Mukono has the lowest which is slightly above 15%. This is contrary to the HIV/AIDS national guidelines that require all health workers to be trained in HIV/AIDS counselling.

45 40 35 30 25 20 15 10 5 0 %age of health %age of trained health workers in HCs III & above Lira Arua Hoima Soroti Mbale Mukono Mbarara Kabarole workers trained in District VCT

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Poor planning and lack of monitoring has resulted in fewer health workers being trained in HIV/AIDS counseling. For example, Shs13.2 Million was used to train 10 health workers from Arua district in counseling and testing. The training was carried out in Gulu although TASO which was providing the trainers had given the district the option of training 20 people at the same cost in Arua which was a much cheaper option but the focal person opted for training only 10 which was an expensive option.

\ It was observed that in instances where training was centralized at the districts, very few people were able to train contrary to training programmes which are organized by the health sub districts. For example, in Mbarara district, the training of health workers in counselling and testing is organized at the sub district level. This is to enable easy identification of training needs and supervision at the HCs.

People avoid untrained health workers from testing them because they believe that they lack the necessary skills to carry out proper counselling. Consequently, this weakness affects the project’s objective of promoting safe sexual living.

7.2.4.3 Supervision of HCT Providers It was noted that there was very minimal supervision of HCT providers contrary to what is required by the National Guide-lines. Health workers who had been trained in VCT and PMTCT but found themselves posted to HCs that did not have VCT and PMTCT services felt under utilized and they expressed fear that the skills they had acquired could easily be lost for lack of practice.

In addition there was no refresher training for the health workers providing HCT services. According to the district health department, this is attributed to the small number of workers that have been trained. As a result, instead of re-training those trained before, they train the ones not yet trained at all. This, they explain is attributed to little funding for training.

7.2.5 Provision of HCT and PMTCT services According to the national guidelines on HIV/AIDS Programs, all HCs, including the private sector offering HIV counselling and Testing must conform to national standards for delivery of services. At a minimum HCT service providers must have personnel, space for confidential counseling and laboratory or materials for conducting HIV testing.

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7.2.5.1 Personnel It was noted that all the HCs providing HCT and PMTCT services had specific personnel particularly in charge of offering these services.

7.2.5.2 Counselling rooms i) It was established that out of the 104 HCs inspected, only 18 (17%) had counseling rooms that complied with national guidelines as shown in the table below.

District No of HCs HCs with % of HCs with HCT No of ideal Inspected HCT counseling rooms Hoima 7 3 42.8 0 Lira 9 8 88.8 1 Arua 26 4 15.3 1 Soroti 15 4 26.6 1 Mbale 9 2 22.2 1 Masaka 8 3 0 Mukono 16 9 56.2 7 Mbarara 8 6 75 6 Kabarole 6 3 50 1 TOTAL 104 42 18

In many HCs, the consultation rooms also serve as counseling rooms while in others, the rooms lack privacy and therefore discourage potential clients.

This has been caused by failure by the implementers in the HIV/AIDS campaign to enforce the standards of counseling rooms.

An example of HC with an appropriate waiting room in the HCT unit

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ii) The HCs have also not been assisted in setting up counseling rooms that comply with the national guidelines. Many HCs have never expanded their facilities to accommodate the rising demand for handling HIV/AIDS related activities. Whereas many HCs were set up to provide the traditional health services, they have not been expanded hence the need to improvise space using the available facilities to accommodate both consultation and counseling services.

The inappropriate rooms hinder service delivery and are bound to discourage people who would be willing to take the HIV/AIDS tests.

A counseling session in an improvised space

7.2.5.3 Laboratories It was noted that all HCs that provide HCT and PMTCT have laboratories for testing. However, in a few cases the laboratory technicians were not always available at the HCS which forces counselors to request clients who accept to return for testing afterwards, after accepting testing following counseling sessions. In some of such cases, the clients never return. Absence of laboratory technicians also results from frequent testing kits stock outs and a small number of people who come for testing.

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It was noted, however, that HCs that provide laboratory services for ART patients were attracting more people even for the HCT services. This was particularly noted in St. Francis Clinic in Mukono district, Mayanja Memorial Hospital in Mbarara district and Virika hospital in Kabarole district.

7.2.6 Submission of Accounts Statements The Project implementation manual requires that accounts Statement be submitted quarterly within one month after the end of the quarter. The CHAIs are required to submit their accounts for at least 50% of the first release before the last release can be processed.

7.2.6.1 It was established that the delay in submitting accountabilities by most of the CHAIS ranges from a few days to many months in many districts surveyed.

7.2.6.2 There is high turnover of accountants in charge of the project in the districts. Besides, sometimes the accounts staff are required to assist with other district accounts duties. Some of the accountants do not know on how to compile the accountabilities. There is little support supervision provided to the CHAI implementers at the district resulting into them failing to submit their accountabilities in time.

7.2.6.3 Delay in submitting accountabilities results in delays in the disbursement of funds to implementing agencies. Consequently planned activities are not implemented in time or not implemented at all.

7.3 CONCLUSIONS

7.3.1 Funds Disbursement The UACP has not provided sufficient guidance and monitoring during project implementation. This is very crucial as the project involves stakeholders from different sectors of the economy. Implementers especially at district and community levels have not been able to meet the requirements of the project. This has mainly been caused by late disbursement of funds to them.

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7.3.2 IEC Materials The project has been able to design a strategy for behavioural change and produced materials to assist implementing the strategy. It has, however not been effectively utilized by the different players in the communities because of poor distribution of the materials produced.

7.3.3 Training of Health workers It is evident that very few health workers have so far been trained in VCT and PMTCT. The project withdrew from PMTCT during the project period. The project has not liaised well with the districts to ensure that the National guide lines on HIV/AIDS prevention are supported.

7.3.4 HCT and PMTCT Facilities The project has been able to equip very few HCs with HCT facilities. Many HCs are struggling to offer these services within the limited available space. Consequently the standards are not met especially in the provision of space for confidential counselling and testing. The personnel available are again responsible for the usual clinical duties sometimes leaving little time for handling HCT services effectively.

7.4 RECOMMENDATIONS

7.4.1 Disbursement of Funds:

The project should speed up the process of disbursing funds to the implementers to avoid delay.

7.4.2 IEC Materials: The project should increase distribution of IEC materials to strategic places. This could save a number of people from contracting HIV/AIDS especially the 30% who do not have access to radios. The project should also train people who will communicate the messages in the IEC materials (which were developed by the project) to the community.

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7.4.3 HCT and PMTCT Infrastructure: All HCs from HC III and HC IV should be provided with HIV/AIDS counseling and Testing facilities such as counseling rooms and laboratory. The project coordination unit should ensure that these health facilities have sufficient testing kits to ensure continuity of providing HCT services.

7.4.4 Training of Health Workets in HIV/AIDS: Proper planning for training of health workers should be carried out and the cheapest possible training should be undertaken. The project coordination unit should monitor and find out the number of health workers who have not undergone training in HIV/AIDS counseling and PMTCT in the participating districts and ensure that district plans incorporate filling the training gaps in the participating HCs and hospitals.

7.4.5 Provision of HCT and PMTCT Services: All HCs providing HIV/AIDS counseling and testing should be advised to provide counseling rooms that allow confidentiality to raise people’s confidence while seeking VCT services.

7.4.6 Submission of Accounts Statements: Project accounts staff should regularly monitor the operations of the district project accounts staff and should write reports thereon. Project accountants in the districts should be equipped with skills necessary to handle project work more efficiently. The project should discourage the districts from transferring the district accounts staff in charge of the projects.

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8.0 MANAGEMENT OF HEALTH PROGRAMMES IN THE HEALTH SECTOR MINISTRY OF HEALTH – (ISSUED DECEMBER 2006)

8.1 INTRODUCTION I have reviewed the management of the health programmes with specific interest to child health and maternal health programmes of MOH which are run by the department of Community Health. The Department of Community Health is responsible for provision of health services to keep the population healthy to enable it to effectively contribute to economic development. This report focuses on the delivery of health services within the child health and maternal health programmes. Provision of services to the general well being of children is conducted in a holistic approach under IMCI which handles the treatment of the major childhood disease symptoms and signs such as fever, cough, difficult breathing, diarrhea and malnutrition. It also handles the assessment of child immunization status and feeding practices of children under 2 years. These diseases accounted for about 70% of all child illness in Uganda (MOH- Annual Health Performance report 2001/2002). The overall goal of IMCI is to reduce morbidity and mortality caused by common childhood illnesses in children under five years of age.

Maternal health interventions on the other hand are run under the general provision of sexual and reproductive health services such as Ante Natal Care, Family planning, Post Natal Care, Post Abortion Care, Essential and Surgical Obstetric Care and life skills development. The interventions are geared at reducing infant and under 5 mortality rates as well as maternal and peri-natal mortality and morbidity.

The primary objective of this audit was to evaluate the economy, efficiency and effectiveness of these programmes using the HSSP performance indicators of; ANC attendance, deliveries in health units, number of users of family planning methods, immunization rates, OPD utilization, GoU budget allocated to health sector, PHC funds released on time to the sector, health expenditure per capita, PHC funds that are expended, districts submitting complete HMIS monthly returns to the MOH in time, HCs without essential drug stocks, accessibility of

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the population to health facilities, children under one year completing immunization doses, proportion of approved posts filled by trained health workers, and malaria fatality rate among children over the age of 5 years.

8.1.1 Background Uganda has been implementing reforms in the health sector since the early 1990’s to reduce mortality and morbidity. These reforms are operationalized through the Health Sector Strategic Plans, focusing on reducing morbidity and mortality from major illnesses under the National Health Policy (NHP). The NHP contains the Minimum Health Care Package (MHCP) to all Ugandan households using the most cost effective interventions.

The burden of disease among maternal, newborn and children is high in Uganda and this is constraining economic development because of the severe impact on the family and society in general. Investment in child health is not only a priority for saving lives but is also critical to advancing other goals related to human welfare, equity and poverty reduction. Almost 90% of all deaths among children under 5 years are attributable to just 6 conditions (acute neonatal conditions, mainly from pre-birth, birth asphyxia and infections, lower respiratory infections mostly pneumonia, diarrhea, measles, malaria and HIV / AIDS). Most of these diseases are preventable through existing interventions that are simple, affordable and effective. These include oral rehydration therapy, antibiotics, anti-malarial drugs and insect treated nets, vitamin A and other micronutrients, promotion of breast-feeding, immunization and skilled care during pregnancy and childbirth.

There is therefore a need to take an integrated view to the reproductive, maternal, newborn and child health as one process from pregnancy through childhood. This is an approach also adopted by the GoU in the PEAP.

8.1.2 Financing The provision of health services is funded by GoU and Development Partners. The majority of the population in Uganda lives below the poverty line with 31.1% (2006), 38.8% (2003) and 44% (2000) of the population living in absolute poverty.

With a population of 27.7 million which is expected to double to 55 million by 2025 and a life expectancy of 46 years (2003), the country faces a challenge of providing quality health

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services given its low level of economic development. This, therefore, means that the majority of the people depend on free medical services provided by Government.

GoU has spent US $ 896.26 million (Ug shs 1640 billion) over the period 2000-2005 implementing the health sector programmes. This translates into health expenditure per capita of US $ 7.28 which is far less than the HSSP I target of US $ 28 and WHO’s Commission for microeconomics and health of US $ 30-40. GoU contribution to this resource envelope was US $ 501.1million (Ug shs 917 billion), (55.9%) and the donor contribution was US $ 395.1 million (Ug shs 723 billion), (44.1%). GoU contribution towards the health sector expenditure has kept on increasing ,but at a reducing rate over the years from 37% in FY 2000/01 to 5% in FY 2004/05. The shortfall is absorbed by the donor counter funding though at a reducing rate.

GOU spent US $ 193.52 million (Ug Shs 354.14 billion) over the 5 year period to finance PHC activities, accounting for 21.6% of the total health sector expenditure of US $ 896.26 million (Ug Shs 1,640.15 billion). Public Expenditure on Health over the HSSP I

Years 2000/01 2001/02 2002/03 2003/04 2004/05 Total GoU Funding (billion Ug Shs) 124.23 169.79 195.96 207.8 219.56 917.34 Donors (billion Ug Shs) 114.77 144.07 141.96 175.27 146.74 722.81 Total Public Health 239 313.86 337.92 383.07 366.3 1,640.15 Expenditure (billion Ug sh) PHC funding (billion Ug sh) 60.89 60.89 66.75 75.88 89.73 354.14 Per Capita expenditure in 10,348.71 13, 128.09 13,653.90 14,969.26 13,843.27 Ug. Shs Per Capita expenditure in US$ 5.9 7.5 7.3 7.7 8.0 GoU expenditure health as % 7.5 8.9 9.4 9.6 9.7 of total government expenditure Budget performance for 82.8 96.2 96 95.4 92.8 GoU(%) Increase on the previous year 37% 15% 6% 5% in GoU allocation Increase on the previous year 25.5% (1.5%) 23.5% (16.3%) in Donor Funding

Source: MOFPED budget framework

8.1.3 Reasons for the Audit The audit was motivated by the realization that despite increasing Government expenditure in the health sector as shown in the previous table, there has been no significant improvement

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particularly community health, “maternal and infant mortality rates” have instead remained high as shown in the table below:

Years 2001 2002 2003 2004 IMR(ADB Report) 88/1000 86/1000 84/1000 83/1000 MMR

8.1.4 Audit Design

Scope The study was conducted in 81 HCs in 14 out of 56 districts. The districts were drawn from all the five major regions. Stratification of the country into regions and judgmental sampling were the methods used in selecting the districts as shown in the table below.

Region Districts Reason for Selection Central Kampala This is the district in which the city is located. It is very urbanized. Mubende This also is not very far away from the audit office. Eastern Katakwi/Amuria This has been affected by insurgency and has IDP camps Busia This is a boarder district with cross-boarder population. Soroti, This is a model district selected by MOH for promotion of maternal and child health. Western Bushenyi This is highly populated district and shares same health conditions with neighboring districts out side the study. Kamwenge This is one of the new districts and has poor health indicators and lacks medical infrastructure. Kabarole This is highly populated district and shares same health conditions with neighboring districts out side the study. Kisoro This is very highly populated and with a unique Landscape (mountainous). Northern Gulu This is highly populated with IDPs Lira This is one of the safe districts in the war zone. Southern Kalangala This is an Island district with unique health conditions and temporary settlements. Rakai This is a district that was highly affected by AIDS scourge. Masaka This is one of the highly populated districts.

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The audit covered five (5) financial years from 1st July 2000 to 30th June 2005. The data collection methods used in carrying out this audit review included interviews with the various stakeholders, review of financial and non-financial reports, observations and physical inspection of the health facilities.

8.1.5 Description of the Audit Object

The health sector comprises government agencies, NGO’s, private and community health providers and various Development Partners. The central authority is MOH, which formulates policies for the sector and oversees the implementation of health programmes. MOH comprises five technical departments namely; National Disease Control, Community Health, Clinical Services, Planning and Quality Assurance. The Department of Community Health is responsible for provision of health services to keep the population healthy so that it effectively contributes to economic development. It comprises five divisions namely:-

• Child Health, • Sexual and Reproductive health, • Environmental Health, • Veterinary Public Health and • Vector born diseases.

This study focuses on maternal and Child Health.

8.2 FINDINGS

8.2.1 Progress

During the period under review, there was remarkable progress in some areas of the health sector against set targets as follows:- • Polio has been eradicated and Uganda was declared polio free in November 2006, • DPT3 Immunization coverage increased from 48% (2001) to 89% (2005) against 85% target, • OPD utilization increased from 0.43 (2001) to 0.9 (2005) against 0.7 target and

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• Dramatic decline in cases of guinea worm from 126,639 cases in 1992 to less than one case in 2006.

8.2.2 Funding

8.2.2.1 Under Funding It was noted that the overall health sector budget performance over the period of 5 years has been at an average of 92.6% with the exception of Busia district which experienced a poor budget performance of 60% in FY2004/05 because MOFPED did not remit funds on time in the FY. This created a funds gap in the district budget thus affecting its ability to implement health activities such as immunization, family planning and the purchase of drugs.

It was also noted that PHC activities in the districts mainly depend on funding by the central Government with less or no contribution from the local governments as a result of the abolition of graduated tax which was among the major sources of local government revenue. Disbursements from only the central government are overwhelmed by the demand for the delivery of health services.

8.2.2.2 Delayed Disbursement MOFPED is required to release funds to districts on a quarterly basis without delay to match the districts’ quarterly plans. It was generally noted that MOFPED delays to release funds at the beginning of every FY. The delay is because MOFPED operates on Vote on Account before the Appropriation Act is passed by Parliament in the first quarter. Therefore, the releases to districts in the 1st and 2nd Quarters of each FY by MOFPED do not match expenditure projections in the Quarters. The poor budget performances in the 1st and 2nd Quarters are later compensated in the 3rd and 4th quarters. For example during FY2003/04 only 59%and 82% of Quarter 1 and 2 funds were released compared to 103% and 111% of Quarter 3 and 4 national wide.

It was observed in Busia and Kampala districts that there was a delay in disbursement of development grants. It was observed in Kamwenge district, that capital development funds released were insufficient leading to non-completion of structures. In the districts of Soroti and

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Katakwi, it was established that funds take between 3 and 7 weeks before they are received by the HSDs due to delayed processing of payments by districts accounts staff. Delays are also caused by health units. For example, in Kabarole district some cheques were found lying in the DDHS office uncollected due to delayed accountabilities from recipient health units.

Delayed disbursement of funds leads to funding deficits during the periods which result into lower performance of the health sector interventions like immunization of children, PMTCT, family planning, Emergency obstetric care, Child nutrition and procurement of logistics such as drugs and medical sundries.

8.2.2.3 Budgeting

MOH has designed guidelines governing the budgeting process at each level of health facilities. These guidelines require full participation of all HC levels from I to IV during budgeting. Area teams have also been deployed to help districts in budgeting techniques. Health sector programmes are activity driven and districts are expected to adhere to strict budget discipline. However, under the Fiscal Decentralization System (FDS), districts are allowed to make re-allocations within programmes up to a 10% limit for under or un funded programmes.

Basing on the budget ceiling for the district, the DDHS in collaboration with the HSDs draw up budget estimates for their respective districts. However, the lower HCs (HC III and HC II) do not participate in the drawing up of these budgets and as a result some of the lower HC activities like security, compound cleaning, building and equipment maintenance are not adequately budgeted for, yet they are essential to delivery of quality health service.

8.2.2.4 Allocation of Funds

There is a systematic and logical formula drawn by MOH for use in allocating funds equitably to both GoU and NGO health units. This formula uses the weighing index that takes into consideration the burden of disease, epidemiological indicators, and intensity factor for averting a loss of life, project funding and hospital coverage. MOFPED disburses funds to districts basing on the advice of MOH.

Districts, however, use different methods of allocating funds to HCs. Each district has its own method of funds allocation basing on the level of the HC, population served, terrain or any

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other method. In Mubende district, the basis of allocations is only known to the DDHS. In Gulu and Lira districts, funds are not released to the HCs but are centrally managed by the DDHS. It was also noted that MOFPED disburses funds to districts and regional hospitals on advice of MOH on the basis of bed capacity as one of the variables. However the actual bed capacities of these hospitals far exceed the official number with some patients sleeping on floors. It was further noted that the district and regional hospital budgets are capped to allow the growth of budgets at lower HCs.

Failure by the Districts to use a systematic and logical formula when allocating funds to lower HCs has led to insufficient funds allocated to these HCs for delivery of quality health services.

8.2.2.5 Funding to NGO HCs

GoU approved a policy of partnership with the private sector where by Government and Development Partners agreed to provide funds to FB-PNFP health facilities. This is intended to subsidize the user fees charged by NGO hospitals to enable a higher number of people to access health services and thus improving on the preventive and promotive aspects of health service delivery.

Under this arrangement, GoU disburses funds to NGO hospitals on a quarterly basis through the districts. Disbursements are made after previous ones have been accounted for. It was noted during the study that although central government significantly funds NGO hospitals/ health facilities, most of them do not offer free health services but instead levy user charges. During FYs 2000/01 to 2004/05, central government spent US $ 40.47 million (Ug Shs74.06 billion) on NGO hospitals and health units which represented 18.5% of the total funds disbursed to districts with the exception of referral hospital as shown below:

YEAR 2000/01 2001/02 2002/03 2003/04 2004/05 TOTAL NGO Funding in (billion 11.59 11.59 16.12 17.04 17.72 74.06 shs) District hospitals +PHC 69.76 69.76 75.39 86.32 99.97 401.2 (billion shs) % of NGO funds 16.6% 16.6% 21.4% 19.7% 17.7% 18.5% Source: MOH- Annual Health Sector performance Reports

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Some of these NGO health units are near government HCs and from interviews with some hospital administrators and DDHS, it was noted that majority of the people prefer government HCs since these provide free health services. It was also noted that accountabilities from these NGO hospitals are not made in time and as a result their subsequent funding is withheld. For example, in Kabarole district, cheques for some of the NGO hospitals had not been dispatched because previous accountability had not been forwarded. In some districts like Mubende district, funds are released to NGO health units without checking the correctness of accountabilities for the previous releases.

NGO hospitals have continued to charge high user fees despite the government subsidy forcing communities to go to government facilities. As a result, the number of patients accessing health services from NGO hospital has remained low due to incapacity of the poor to pay user fees.

8.2.2.6 Diversion of Funds

GoU Treasury Accounting Instructions and the PFAA require the utilization of public funds in a manner that is authorized by Parliament.

It was noted that Kasilo HSDs in Soroti district was allocated US $ 41,967 (Ug shs 76.8 million) for the purchase of drugs in two FYs (2004/05 and 2005/06) but only US $ 22,623 (Ug shs 41.4 million) was paid for drugs leaving an un-utilized balance of US $ 19,344 (Ug shs 35.4 million). Further investigations revealed that only US $ 5,738 (Ug shs 10.5 million) of the unutilized balance was still on the account of the HSD. The balance of US $ 13,607 (Ug shs 24.9 million) could not be explained by management.

In a related development Tirir HSD also in Soroti district diverted US $ 2,186 (Ug shs 4 million) meant for drug procurement to financing administrative expenses contrary to drug expenditure guidelines issued by MOH.

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Non adherence to the Treasury Accounting Instructions and PFAA led to the diversion of funds earmarked for the procurement of drugs and medical sundries for health sector interventions like immunization of children, PMTCT, family planning, EMOC and Child nutrition.

8.2.2.7 Accumulation of Funds at the HSD Accounts

It is a good budgetary practice to ensure that programme activities are carried out in the stipulated period. This calls for the utilization of funds released according to the budget allocations. It was noted, however, that districts and HSDs do not undertake programme activities in accordance with the budgets and leave large unutilized balances on their bank accounts.

Delayed transfer of funds from the districts towards the end of the FY to HCs, under staffing in accounts and other delays while processing payments led to accumulation of account balances. This problem was very acute in FY2000/01 where US $ 1.75 million (Ug shs 3.2 billion) remained unspent on district accounts only to be spent in the following year (Annual Health sector performance report, 2001/02). Failure by the districts to utilize funds in implementation of health programmes may lead to inadequate drugs being procured hence affecting the delivery of health services.

8.2.3 Accountability and Bookkeeping methods It is a good accounting practice for entities in the same sector to have a uniform accounting and book keeping system to enable comparison and reporting on activities for decision making purposes. It is also a requirement under PFAA for every officer to account for public funds entrusted to him and the accountability shall be subjected to independent verification.

It was noted, however, that two different methods of book keeping are used by different districts which impacts negatively on the accountability process. These are centralized and decentralized bookkeeping. In a centralized bookkeeping system, funds are received and spent at the district and accountability made by the district. In the decentralized system on the other hand, funds are received by the district and disbursed to the HSDs which either transmit the

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funds to the lower HCs or spend at the HSD on their behalf. Where HSDs spend on behalf of the lower HCs, accountability will be found at the HSD and where the funds are transmitted to the lower HCs, accountability will be made by the respective HC and submitted to the HSD.

Districts which were centrally maintaining HCs books of accounts had their accountabilities verified by the district internal audit departments regularly whereas accountabilities for those using a decentralized system of book keeping were not subjected to independent verification on a regular basis.

As a result, accounting records in the decentralized system were not up to date because the health workers charged with this responsibility lacked accounting skills. Due to lack of a standard system of accountability and book keeping in all districts, different districts have employed different methods and this may lead to poor accountability and misappropriation of funds which could in turn have a negative effect on health service delivery.

8.2.4 Equipment Effective health care delivery requires a network of functional health facilities that are adequately equipped. Health facilities work as an interface between the health system and the community. The MOH national medical equipment policy provides guidelines on standard equipment expected for each HC II to IV, district and regional referral hospitals. MOH directly specifies the type of equipment to be distributed to specific HCs.

Most of the equipment used in the HCs is procured directly from the suppliers by MOH while others are donated by projects and NGOs depending on their work plans. The equipment is delivered to the districts for further distribution to earmarked HCs. There are circumstances when general equipment is procured by MOH for districts. On receipt of equipment, the DDHS allocates them to HCs according to the HC assessed needs. In addition, MOH has set up regional workshops to service and repair HC equipment to which districts and referral hospitals contribute funds to meet operational costs. Specialized and/or sophisticated equipment are maintained through supplier maintenance contracts.

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8.2.4.1 Recording/tracking of HC equipment

An asset register is designed to provide information about the assets in respect of location, condition, quantity, cost and date of purchase. It was observed that in some HCs asset registers/inventory records are either non-existent or are poorly maintained. Out of 81HCs visited, only 52 (64.2%) had asset registers/inventory records. It was also noted that HCs that maintained asset registers are mostly the higher level centers like the district and regional hospitals. Given the average population of 27,632 HCs, 9,892 HCs on a national level may be lacking assets/inventory records. Lack of assets/inventory registers was due to limited management skills exhibited mainly by lower level administrators who in most cases were pre-occupied with actual delivery of health services. The absence of asset/inventory registers can easily lead to difficulty in identification of equipment gaps thus leading to inadequate planning for the procurement of equipment required in the delivery of quality health services.

8.2.4.2 Maintenance of HC equipment

MOH set up regional maintenance workshops to ensure that health facilities are equipped with well maintained equipment.

It was observed that the condition of equipment at HCs was not satisfactory and maintenance is not regularly done. Equipment like refrigerators, solar systems, microscopes, CD4 count machine and vehicles were found to have broken down. In some districts, the equipment take over a year without servicing and maintenance. In Gulu hospital, it was observed that equipment like sterilizers/boilers, theatre equipment, power generator, beds, trolleys and stretchers are very old and constantly break down.

The reasons for the above are failure by management at HCs to identify and report mechanical problems in time and limited technical skills of personnel at the mechanical workshops. For example, a CD4 count machine at Fort portal regional referral hospital was not working and the staff at the mechanical workshop had failed to repair it due to the limited technical skills.

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It was also discovered that the budget provisions of HSDs in Mubende district do not provide for vehicle maintenance and as a result management is unable to obtain resources to meet these unbudgeted expenses.

Failure by management to maintain equipment leads to constant break down which disrupts health service delivery. For example, treatment of HIV-AIDS patients has become difficult in hospitals where CD4 count machines have broken down. HCs with broken down solar systems are unable to preserve immunization vaccines and this affects their out reach activities. Broken down ambulance vehicles affect the delivery of EMOC services in HCs.

8.2.4.3 Utilization of HC equipment

In order to deliver sufficient health services, MOH constructed theaters at each HC IV and district hospital.

Out of 33 theaters visited, only 28 were found operational. 5 theaters were fully equipped but due to the absence of medical personnel were not operating. Some laboratories were also equipped but not operating due to lack of medical personnel.

Each HSD is given an ambulance vehicle – a double cabin pick-up to handle emergency cases in the HSDs. It was observed that these vehicles are ordinary pick-ups which are not designed as ambulances. As a result management is using them for other duties such as staff transport and administrative work like collecting drugs from suppliers.

It was noted in Bukuku HC IV in Kabarole district that the solar battery charging system in the theatre was used to charge private mobile phones.

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Theatre battery charging system used to charge private phones, Bukuku HC IV, Kabarole district.

Insufficient utilization of equipment has led to inadequate service delivery. Non functional laboratories lead to treatment of diseases without first examining samples from patients. Some theaters are not offering EMOC services to mothers with difficulties in delivery, exposing them and their babies to high risk of maternal and infant mortality.

THEATER EQUIPMENT AT KIGANDA HC IV NOT INSTALLED, MUBENDE DISTRICT

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8.2.4.4 Inadequate and/or missing HC equipment As already mentioned above, MOH is responsible for equipping HC II to IV, district and regional referral hospitals with necessary equipment to enable delivery of health services.

It was generally noted that all the 81 (100%) health facilities visited, lacked equipment of one type or another. The magnitude of shortage of equipment is more acute in lower HCs compared to district and regional hospitals. On the basis of this finding, it is reasonable to conclude that all the 27,632 health facilities in the country lack equipment of one type or another.

Most of the HCs lack laboratory equipment, delivery kits, testing kits, Oxygen cylinders BP machines, drip stands, scanners, examination screens, weighing scales, communication equipments, beds and mattresses. It was also noted that due to poor or lack of communication equipment like radio calls, HC IIIs are not able to communicate with HC IVs and HC IVs can not communicate with district and regional hospitals. It was further noted that due to lack of scan and ultra sound equipment in HC IVs around Kampala district, Mulago national referral hospital was overwhelmed with patients lining up for these services.

Lack of equipment is, apart from limited funding, attributed to the following: • Weaknesses in identifying equipment gaps at HCs to enable proper planning and budgeting by MOH, • Weaknesses in maintenance of equipment that leads to constant equipment break down and • Overwhelming number of patients that has exerted enormous pressure on a few equipment leading to break down

8.2.4.5 Laboratory equipment It was noted that most of the health units lack laboratories and laboratory equipment leading to treatment to be done symptomically. For example, between the years 2002 and 2005, out of a yearly average of 9 million malaria cases treated, 7.5million (83%) were not tested in laboratories as per table below:

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Malaria Treatment (2002-2005) % of Malaria Malaria cases Malaria Malaria cases treated positive treated, but not tests done Diagonised Malaria not slides tested Year tested

2002 1,097,562 555,990 8,008,481 6,910,919 86%

2003 1,566,474 801,784 9,276,944 7,710,470 83%

2004 1,859,780 879,032 10,681,645 8,821,865 83%

2005 1,583,795 842,594 8,188,525 6,604,730 81%

Average 1,526,903 769,850 9,038,899 7,511,996 83% Source: MOH- Health Management Information System (HMIS)

8.2.4.6 Delivery and EMOC equipment There has been a remarkable improvement in the number of babies delivered from health facilities as shown by percentage deliveries of 25% (2002) and 50% (2005). It was, however, noted that fewer deliveries take place in health facilities which may be due to lack of equipment, among other reasons, despite the good ANC attendance. Table below refers.

Annual Deliveries Year 2002 2003 2004 2005 Average NO.of deliveries in HCs 214,083 262,633 303,799 354,856 283,843 Total deliveries* 854,853 835,672 1,012,038 755,533 864,524 % deliveries in HCs 25% 31.4% 40.2% 50% 33% ANC attendance 1,021,530 1,136,652 1,190,148 857,630 1,051,490

Source MOH- Health Management Information System (HMIS) *Total deliveries approximated to 1st year measles immunization

Lack of equipment among other factors has hampered the provision of EMOC services that play an important role in the mitigation of the Maternal Mortality rate which is currently standing at 506/100,000 live births, this is below the targeted 354/100,000 (2005). For

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example, a study carried out by MOH during FY2002/03 revealed that 4% of HC III was offering BEMOC services, 6% of HC IV while 65% of district and regional hospitals were offering CEMOC services. There was a slight improvement in FY2003/04 as 9.5% of HC IVs offered BEMOC and 70% of district and regional hospitals offered CEMOC service.

8.2.5 Drugs

Drugs are an important component of a health system. Availability of drugs is one of the major indicators of quality health delivery. MOH in collaboration with the National Drug Authority, National Medical Stores and Professional Councils provide overall co-ordination and guidance on procurement of pharmaceuticals, other medical supplies, logistics and instructions on their rational use.

We noted that under the decentralization system, actual procurement of drugs in the districts is done using either the credit line method or direct purchases by the districts and HSDs. Under the credit line, a Memorandum of Understanding is signed between GoU and NMS. Funds are allocated to each HC’s account with the NMS by the MOH and drugs delivered to the district by NMS on the basis of drug requisition orders from HCs. There is a standard delivery schedule issued by NMS every year showing the order and delivery date deadlines.

Under the direct purchases method, at least 50% of PHC funds released by central government must be used to purchase drugs. These drugs must be purchased from NMS as a first priority and it is only upon issuance of a certificate of non availability by NMS that the district may purchase from any other supplier.

The method of distribution of the drugs purchased is determined by the method of book keeping used by the districts as explained above. In a centralized system of book keeping, drugs are distributed by the districts to HSDs which later distribute them to HCs under their jurisdiction. In a decentralized system of book keeping, drugs are distributed by the HSDs. The method of drug distribution will also depend on the method of drug procurement. Credit line drugs are distributed by NMS to the districts and then collected by the HSDs for later distribution to HCs. Drugs directly purchased under the 50% PHC funds are distributed by the

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authority responsible for the purchase. If drugs are purchased by HSD, then they will be distributed by HSD and those purchased by the district, are distributed by the district.

Under the new ‘Pull system’ of drug procurement, NMS has a logical accounting system that links all credit lines of health facilities. Orders are supposed to be made within specified ordering schedules and deliveries expected within a period of 2 months from the ordering date.

8.2.5.1 Procurement Procedure

The PFAA requires officers to comply with established procedures/regulations when utilizing public funds. It was noted that under the credit line method, HCs do not have knowledge of how much has been credited on their accounts with NMS. Although MOH informs the districts of how much funds have been budgeted under the credit line in a given FY, districts are not notified of how much credit each HC has been allocated and actual debit by NMS in a given period.

It was again noted that although NMS operates a computerized invoicing and accounts system, drug accounts statements of individual HCs were not regularly given to them, but HCs only receive them on request.

Furthermore, it was noted that NMS does not deliver drugs to HSDs, but to the districts and HSDs take long to collect the drugs from the district stores causing delays. In order to reduce delays on the delivery time by NMS, it was noted that Kampala and Bushenyi districts have resorted to purchasing drugs from other suppliers without waiting to attain certificates of non availability from NMS.

Lack of transparency in the procurement process may lead to misappropriation of funds and drugs. Furthermore failure by NMS to deliver drugs to HCs causes drug shortages at these centers. For example, a number of HCs were found lacking children syrups and family planning supplies.

8.2.5.2 Record Keeping

The PPDA Act requires proper recording of stores procured.

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It was noted that 19 HCs (23.5%) out of 81 HCs visited did not have proper drug records. It was also noted that stock cards and dispensing records are either not kept or are not updated, reconciliations between stock records and physical stock verifications are not carried out. On a national level, the above finding deduces that 6,482 HCs do not have proper drug records. The reasons for not keeping proper stores records include lack of skills and time by health workers to regularly post stores transactions.

When store records are not maintained, it is possible for drug leakages to go un-noticed, it could also lead to delay in the identification of drug stock outs and expired drugs. The resultant effect would be drug shortages that would disrupt health service delivery.

8.2.5.3 Drug Stock Levels; Stock-outs:

Out of 81 HCs visited, 31 (38.3%) lacked essential drugs and sundries required by the medical personnel of the HCs in carrying out their duties; extrapolated to the HC population, this indicates that 10,583 HCs national wide lack essential drugs.

For example at Olwal HC II, Pabbo HC II, Awer HC II in Gulu district, the drug store was virtually empty; and as at the time of the visit in July 2006, Olwal HC II had last received drugs in Jan/Feb 06; Mutukula HC III in Rakai district had not been supplied drugs in the last three months and Kalongo HC III in Mubende district had last received drugs six months ago. The causes of drug shortages is attributed to limited funds, delayed deliveries, overwhelming number of patients, delivery of drugs by NMS which are not ordered for by HCs, bureaucratic procurement procedures and poor stock management skills.

In Kamwenge HC III, Kamwenge district, the officer in charge was forced to discharge patients who were admitted while still in poor condition due to lack of drugs.

Further analysis of data from the HMIS also indicated drug stock outs in a number of HCs. On average out of 27,632 reporting HCs, 1,189 lack the first line drugs for family planning and treatment of malaria.

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Average No. of No. of Chloroquine Cotrimoxazole Measles Depo- ORS sachets Fansidar HCs HCs in tabs tabs vaccine Provera lacking Districts drugs YEAR

2002 436 569 483 302 447 492 455 24,934

2003 1,085 1,986 1,933 486 1,271 1,848 1,435 29,455

2004 1,410 2,501 1,965 576 1,110 2,004 1,594 32,398

2005 1,649 2,469 1,401 348 564 1,199 1,272 23,740

Average 1,145 1,881 1,446 428 848 1,386 1,189 27,632 Source MOH- Health Management Information System (HMIS)

It was also noted that the persistent shortage of reproductive health supplies may lead to the poor performance of RH interventions. The cause of the poor performance is limited budget allocations given to these interventions by districts, HSDs and HCs.

This is further confirmed by the low levels of family planning users and the contraceptive prevalence rate that has stagnated at 23%.

Family planning Users (calendar years) YEAR New users % increase/decrease Revisits % in New users increase/decrease in Revisits 2002 534,113 528,283 2003 522,969 -2% 496,392 -6% 2004 639,809 22% 617,362 24% 2005 358,424 -44% 349,403 -43% Average 513,829 -8% 497,860 -8% Source MOH- Health Management Information System (HMIS)

Drug stock outs have led to poor delivery of health services as patients are asked to purchase their own drugs from private clinics at exorbitant prices and those who can not afford to buy drugs go home untreated. This has also increased the number of referrals to HSDs, district hospitals and regional hospitals.

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8.2.5.4 Expired Drugs MOH has a system of identifying, collecting and disposing expired drugs in line with the NDA guidelines. Expired drugs were noted in 17 Health Units as shown in the table below.

District HC II HC III HC IV District Regional Hospital Hospital Gulu Olwal, - - - Gulu Pabbo Lira - Apala - Lira Soroti - Diana Tirir, - - Memorial, Apapai Gweri Katakwi Akoboi, Toroma, - - - Bisiina Ngariam Bushenyi - Bushenyi - - - Kabarole - - - - Fort-Portal Mubende - Kalongo - Mubende - Total 4 7 2 2 2 Source MOH- Health Management Information System (HMIS)

Poor stock management was also noted at the National Medical Stores, who are the major medical suppliers of health units where 42,555 packs of ARVs valued at an approximate of Ug. Shs 936 million (US $468,000) expired. It was noted that one of the causes of drugs expiring was poor stock management resulting in procurement of large quantities of slow moving drugs like vaccines.

NDA guidelines have not been followed and some expired drugs were still in stores at HCs at the time of the study.

It was further noted that MOH replaced HOMAPAK as a drug for treatment of malaria with COARTEM and as a result some HCs were found with large stocks of HOMAPAK which will expire if not put to use.

Expired drugs do not add value to the delivery of health services and can be misused by unscrupulous persons causing undesirable health conditions to the public.

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HOMAPAK: Malaria Drug, Bot Distributed at KCC Stores

8.2.5.4 Drug Stock Storage Facilities

MOH and NDA guidelines require proper storage of drugs in health facilities in order to protect them from harmful climatic and physical conditions.

It was observed during inspection of HC stores, that 7 HCs out of 81 visited lacked or had improper drug and sundries stores implying that about 2,388 HCs on a national level lack proper drug storage facilities. Some of these stores are not well arranged, dusty, not well ventilated, are very small and lacked shelves. Some HCs do not have stores and instead improvised a section in the dispensing or examination room as a store. It was also noted that the drugs are kept in boxes or piled on top of each other instead of shelves which make dispensing cumbersome. In some cases, expired drugs were not separated from unexpired drugs.

HCs have no proper storage facilities thus making drugs vulnerable to destruction and theft.

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8.2.6 IEC Materials

IEC materials are designed and developed to increase awareness in the prevention and control of diseases, increase public participation and involvement in the delivery of health care and increase demand and utilization of health services. IEC materials are used for dissemination of preventive and curative information. Methods used to disseminate information include posters, leaflets, mass media including press, radio, TV, video and drama shows.

It was noted that MOH develops and designs IEC materials while districts translate the developed IEC materials into local languages of the communities in the district.

IEC materials are procured by MOH and distributed to districts or collected by participants during national workshops. The district health educators are then charged with physical distribution of these materials to HCs.

We noted that the practice of translating IEC materials is to change to involve districts in the development of the IEC materials. In Soroti district, it was noted that some of the posters translated into Ateso in Apapai HSD had spelling mistakes. It was observed that Busia districts has a multi-lingual society, but the IEC materials displayed were not translated in all the local languages in the district. In the districts of Rakai, Kalangala ,Bushenyi, Fortportal, Kamwenge, most of the IEC materials were in English and not in the local languages. Posters are commonly used IEC materials; however, leaflets were noted in Masaka and Bushenyi districts. It was also observed that video tapes and TV monitors are used in Soroti and Katakwi districts. Most of the IEC materials are displayed at the HCs premises; in some cases, posters and leaflets were still lying in stores. On enquiry, we were told that they are not displayed in other public places for fear of destruction and/or removal by some community members.

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IEC Materials just being kept in Office at Ntara HC IV, Kamwenge District

Designing and development of IEC materials at the MOH headquarters does not bring out the intended message properly for the target groups since words and symbols may have different meaning in different local languages. This creates low coverage IEC materials leading to less awareness and participation of the communities in preventing and controlling diseases. For example immunization and family planning campaigns may fail due the failure by IEC materials to disseminate information to the right people in the right places.

8.2.7 HC Buildings

HC buildings are expected to be constructed following standard specifications developed by the health infrastructure development and management department of MOH. These specifications determine how laboratories, theaters, maternity wards and other medical and non medical buildings should be constructed.

Most of the construction of HC facilities is funded by the central government using PHC development and LGDP funds. In some districts, constructions are also done by Development Partners through projects and NGOs. Previously, local governments used to help in the construction of some health facilities but have since stopped citing financial constraint following the abolition of graduated tax which was their major source of local funds. According to the last inventory count taken in FY 2003/04 out of 2,734 heath facilities in the country, GoU owned 1,855 (68%) facilities, an increase of 7.8% over the previous year.

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Maternity Ward at Kyabugimbi HC IV Constructed Using LGDP funds, Bushenyi District.

8.2.7.1 Non-operational completed structures

The objective of constructing medical and non medical buildings at HCs is to facilitate the delivery of health services to the community.

It was noted, however, that 9 HCs had well completed structures that were not being utilized. The reason given for non utilization of structures was lack of medical personnel and equipment.

This has affected the implementation of national health programmes. For example operations can not be carried out on mothers with birth complications at Kibito, Bukuku, Atiak, Busia and Ogur HC IVs. New born babies and mothers share the general wards with other patients thus putting them at risk since they can be infected with diseases.

8.2.7.2 Incomplete Structures

Construction is expected to be carried out as per annual plans of entities and completed within specified time frame.

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It was observed during the study that 16 HCs out of 81 visited had incomplete structures. These structures included maternity wards, doctors’ houses, staff houses, theaters, OPDs. This translates to 5,458 HCs in the country that may be having incomplete structures.

We were informed that this is due to limited funding, shoddy work by contractors and also the fact that districts continue to requisition for funds to construct new facilities without first completing existing ones.

Scrutiny of MOH Annual Sector performance reports attributed the problem of incomplete structures to: • Inadequate funding because unspent budgeted funds are returned at the end of the FY to MOFPED and are not recouped, • Slow and bureaucratic process of tendering construction works at districts and • Inadequate monitoring and supervision of construction works. Incomplete structures are not useful to government in its effort to improve on the provision of health services. New born babies and their mothers lack maternity wards, districts have failed to attract qualified medical personnel due to lack of accommodation among other reasons and many minor medical cases have continued to be referred to district and regional referral hospitals.

8.2.7.3 Unsatisfactory Constructions

As stated above, construction of medical and non medical buildings is expected to be done in accordance with the standard specifications set by MOH under its department of health infrastructure development and management. These specifications are communicated to all districts which supervise these constructions.

It was observed that some of the constructions at the HCs though complete have been poorly constructed and the following defects were noted: • Sagging ceiling, • Big cracks in the walls and • Incomplete ceilings in the theatre allowing free entry of vermin like bats.

Unsatisfactory works can be attributed to inadequate supervision by both the districts and the MOH supervisory units, poor selection of contractors by the districts and laxity of managers at the HCs to report poor works to higher authorities.

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Buildings that have been poorly constructed have not been put to use pending additional works thus leading to wasteful expenditure. Some of these buildings that have been put to use are a security risk to patients and medical staff.

8.2.7.4 Maintenance and security of HC buildings

Buildings should be maintained regularly if they are to be effectively used through out their expected useful life. It is also important to keep these facilities secure from any damage, theft or misuse.

A number of building structures in some of the HCs need to be renovated. Most of the walls require painting; floors are cracked, sewerage systems broken and rooms infested with vermin including bats and rats.

The security of especially lower HCs is compromised as most health centers have no fences around them and security guards. Some of the stores and laboratory rooms are not burglar proofed compromising the security of equipment and drugs.

Buildings have not been maintained due to insufficient budget allocations to carry out renovations, fencing and recruitment of guards at the HCs.

A Placenta Pit Cracking and Water Logged at Bukuku HC IV, Kabarole District

The placenta pit was built at a site with a low water table causing it to be water logged

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A review of the results of the last survey on the medical buildings carried in FY 2003/04 and summarized in the table below indicated that 32.3% and 31.6% of HC III and HC IV respectively require renovation.

National Building Status as at FY 2003/04 HC III Buildings A B C D N Total OPD 266 75 66 1 12 420 Maternity 210 43 37 0 130 420 General Ward 101 30 23 0 266 420 Total 577 148 126 1 408 1260 HC IV Buildings . A B C D N Total OPD 65 18 19 1 0 103 Maternity 59 19 17 0 8 103 General Ward 49 18 14 0 21 102 OP Theatre 87 6 3 0 7 103 Mortuary 17 7 6 0 73 103 Total 277 68 59 1 109 514 KEY: A Good condition only needed routine maintenance C Major renovations B Minor renovations D Recommended for demolition N Buildings not available Source: MOH- Annual Health Sector Performance Report 2003/04

8.2.8 Staffing

8.2.8.1 Staff Training

In-service training plays an essential part in the development of the Human Resource for Health (HRH). A trained and skilled health sector work force contributes to achieving the National Health Policy through the implementation of HSSP. It is important that training is systematically planned and implemented with less disruption of health service delivery.

It was noted that most training programmes organized by MOH are adhoc i.e when there are disease outbreaks or national campaigns. In some districts staff identify their own training needs and solicit for funding privately while in other districts like Rakai, the staff have had training on an annual basis in different fields of specialization. In Kalangala and Gulu districts, there was no evidence of training in the last 5 years.

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Staff training has mainly been on job training, workshops and seminars and a few staff going for long courses in the field of medicine. Health workers commonly train in PMTCT, VCT and immunization courses because these interventions are adequately funded by donors.

It was noted that districts do not properly provide for staff training in their annual budgets by making regular reviews of the manpower requirements to identify training gaps. Training by the MOH is also not properly organized; It is in most cases adhoc and skewed to particular programmes.

Lack of systematic training programmes has resulted in most staff remaining untrained in required medical disciplines and duplication of training efforts which results in wastage of resources. Some health interventions like administration of ARVs, Family planning programmes, child nutrition campaigns have not been implemented in some HCs due to lack of required skills by medical workers.

8.2.8.2 Job Rotation and Transfers

It is a good human resource management practice to transfer and rotate staff regularly in order to improve their performance levels. This is a key requirement in the human resource management policy.

It was noted that districts do not have a policy on transfer and rotation of staff. The current practice is that staff are transferred or rotated when a need is identified in a particular HC and not on a routine basis. Thus, health workers in hard to reach areas are not rotated as was noted in Kabarole district. According to the national medical staff survey carried out in FY2003/04 the staffing levels in the districts countrywide varied from 40% to 265%. This means that some districts attract more health workers than others.

Unclear resource management policies in districts have affected the development of guidelines on staff rotation and transfer. This has in turn led to concentration of staff in urbanized areas

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of districts causing staffing gaps in rural HCs. The delivery of health services in the rural areas is affected more by insufficient staff numbers among other reasons.

8.2.8.3 Staff Appraisal and Supervision

Public service guidelines require confirmed public servants to be individually appraised once a year while those on probation are to be appraised half yearly.

A sample of appraisal forms seen in personnel files for medical staff in the districts of Soroti, Katakwi and Masaka were up to date but those of Gulu, Lira, Busia, Bushenyi, Kamwenge, Kabarole, Kalangala and Mubende districts were not. In some districts, medical staff were last appraised in 2002.

Some supervisors complained that a lot of information is requested in the appraisal forms yet it is not linked to staff performance and that recommendations on some staff are not implemented.

The delay in the regular appraisal of staff was attributed to the fact that staff do not submit their forms in time and that they only do so for promotional interviews.

When staff are not regularly appraised their performance levels can not be ascertained and this may cause staff to relax and fail to meet their targets. The level of staff commitment will determine the level of health service delivery. For example, the efficient and effective extension of out reach services on immunization, family planning, counseling and public health education requires a motivated staff force.

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Patients Waiting for Medical Workers at Rukunyu HC IV, Kamwenge District

The audit team reached Rukunyu HC IV at 10.00 am and there were no medical workers present

8.2.8.4 Staffing Gaps

The availability of qualified health workers and other service providers is very crucial for the attainment of better service delivery to the people. The number of staff to be recruited at each level of HC is determined by the staffing requirements in the HSSP and district ceilings.

Because of the decentralization policy, recruitment, appraisal and deployment of health workers for HCs and district hospitals are carried out by the respective DSC, with the staff ceiling given by MOH. The DSC therefore advertises, shortlists, interviews and selects the suitable medical staff. Recruitment of health workers in Regional and National referral hospitals is done by the HSC.

All 81(100%) HCs and hospitals visited had manpower shortages. The number of staff deployed at the HCs and hospitals is not per recommended staffing guidelines and HSSP norms issued by the MOH stated above. This would also indicate that there is a staffing problem in all the 27,632 health facilities in the country. It was noted that in some HCs, mothers deliver without the help of midwives, laboratories do not function due to lack of lab technicians, nursing assistants dispense drugs, records

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assistants receive patients on arrival and health workers engage in accounting and administration work among others. The HMIS data on ANC and deliveries for the years 2002 to 2005 revealed that out of an average of 1,051,490 mothers who re-attended ANC, only 356,729 (34%) gave birth under skilled care as shown in the table below:

Maternity Figures 2002-2005 Deliveries Deliveries ANC re- Maternity Deliveries Deliveries outside under att Admissions in Units with TBA skilled skilled care YEAR care*

2002 1,021,530 301,283 243,551 86,728 330,279 720,247

2003 1,136,652 348,585 261,086 96,321 357,407 788,067

2004 1,190,148 378,419 287,824 109,735 397,559 811,729

2005 857,630 324,559 271,858 69,812 341,670 533,071

Average 1,051,490 338,212 266,080 90,649 356,729 713,279

Source MOH- Health Management Information System (HMIS) * Mothers who attended ANC but did not give birth at health units or using TBAs.

One of the reasons given by some expectant mothers interviewed for not returning to give birth under skilled care cited lack of midwives and lack of confidence in non functional health facilities.

The problem of limited staff numbers is not only due to lack of funds to recruit staff, but also poor manpower planning, deployment, training, transfer and retention. For example 4 health workers at Kibiito HC IV, Kabarole district were allowed to go on study leave of more than 2 years while Kamwenge district which has only two doctors allowed both of them to go on 2 years study leave.

A review of MOH- Annual health sector reports also revealed that the sector has been experiencing staffing gaps that has hindered service delivery as shown in the table below:

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Minimum staffing norms MOH YEARS 2001/2002 2002/03 2003/04 2004/05* NORM 3,712 9,919 13,232 3,860 ACTUAL 2,867 8,371 11,389 2,453 GAP 845 1,548 1,843 1,407 % of filled posts 77.2% 84.4% 86% 63.5% Source: MOH- Annual Health Sector performance Reports. * Figures only include MOH headquarters and Regional referral Hospitals

8.2.9 Monitoring and Evaluation

8.2.9.1 Monitoring and Supervision:

MOH is expected to carry out monitoring visits in all districts on a quarterly basis in accordance with the national supervision guidelines. It sets up monitoring area teams to visit all the districts. An area of focus is set for these teams and because it is understaffed, it at times seeks assistance from the medical staff at regional hospitals and co-opts medical interns to be part of the teams. The districts also deploy health teams to carry out monitoring of the HSDs and lower HCs every month. Under the referral system, hospitals are expected to carry out support supervision and mentoring visits. National referral hospitals visit Regional referral hospitals which in turn visit General hospitals (District hospitals). District hospitals also visit HC IVs. This arrangement helps to fill the medical skills gaps at the lower levels and allows sharing of experience among the medical staff.

It was noted that monitoring and supervisory visits that are undertaken are much less compared to those required by the guidelines. The few visits that are carried out lacked a wide coverage in terms of HCs visited. It was also noted that the monitoring reports are not always forwarded to the districts but instead the findings and recommendations are discussed generally at Joint Review Mission workshops. Implementation of the recommendations is normally done if it is within the budget and if funds are available. The findings and recommendations of the district monitoring teams on HCs are also discussed at district forum in general terms.

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It was also established that districts which receive funding from UPHOLD project have a support supervision mechanism under the theme “Yellow Star” i.e quality assurance in which Pre-designed forms with standard variables are used to conduct the supervision. Findings are immediately communicated to the HC. For example in Kalangala district, Kyamuswa and Bujjamba HSDs were visited twice in the last 5 years by MOH.

Monitoring and supervision system does not only depend on sufficient funding, but also on effective planning at different political and administrative levels. Also, insufficient staff numbers has overwhelmed the few staff with other health interventions.

Inadequate monitoring and supervision affects the quality health of service delivery. Staff tend to relax if they know that their performance is not constantly monitored and it might be difficult for health sector management to identify areas of weakness for improvement.

8.2.9.2 Performance Evaluation System

MOH has developed a good computerized monitoring and evaluation system- HMIS. This system captures all the variables needed in assessing the performance of the health sector at all levels of implementation and they include:- OPD attendance, maternity attendance, family planning usage, child health care, financial data, support supervision data, drug stock outs. These variables are used in setting performance indicators for measuring the extent to which the set health goals and objectives are met. It is a requirement under the HMIS for all levels of HCs, HSDs and districts to complete HMIS forms every month and submit them to the MOH headquarters. The HMIS is designed to produce monthly and annual reports at every HC level and private hospitals. These reports are consolidated at the district level and forwarded to MOH which consolidates district reports to form national reports. It is from the national report that the national annual performance report is made.

It was noted that the system is not being fully implemented by all the HCs visited. For example the average number of HCs using the system for the last five years was 24,095 out of a total of 27,632. This represented an average of 89% compliance as per table below:

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Number of HCs reporting

HCs in Districts Units reporting % Units reporting YEAR 2002 24,934 20,622 86% 2003 29,455 25,898 89% 2004 32,398 28,589 90% 2005 23,740 21,271 91% 27,632 24,095 89% Average

Source MOH- Health Management Information System (HMIS)

It was further noted that some of the HCs using the system leave out some important information and some of the reports are not submitted in time. Information on number of visits by support supervision teams, planned and actual out reaches, funds budgeted, released and spent and drug shortages was found missing from a sample of the HMIS forms seen.

Most of the HMIS assistants interviewed stated that they lacked sufficient skills to use the system while others complained of inadequate stationery. It was also noted that enforcement of compliance at lower HCs is weak. Some districts manually run the system, making it difficult to enter and summarize data while others with computers lacked competent personnel.

Incomplete and delayed reports do not help management address health challenges in time and this negatively impacts on the quality of health service delivered. For example, health campaigns on immunization, family planning, child nutrition, VCT and PMTCT could be emphasized in areas that show poor performance indicators. This would help in efficient utilization of the much limited resources.

Status of HMIS Reports Submitted by Districts Characteristic 2001/2002 2002/2003 2003/2004 2004/05 Average Completeness 95% 86% 85% 85% 87.75% Timeliness 77% 70% 90% 90% 81.75% Source: MOH- Annual Health Sector performance Reports.

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8.2.10 Accessibility

8.2.10.1 Basis of Location and Coverage of HCS

This is carried out by districts on the basis of guidelines provided by MOH as follows:- HC II per parish, HC III per sub-county, HC IV per constituency, general hospital for every 500,000 people and a regional referral hospital for every 2,000,000 people. MOH also provide that ideally, a HC should be within a radius of 5km of the community it is serving.

After decentralization, the responsibility of allocation of HCs was passed to districts. It was noted that some HCs were not distributed in accordance with the guidelines set by MOH. As a result some HC are located near each other, near established hospitals including NGO hospitals or far away from the large communities as shown in the table below:

District Health Facility Remarks Busia 2 HC IV 2 HC IV in one constituency contrary to MOH guidelines. Kabarole Bukuku HC IV, Karambi HC III All the 3 facilities located near Fort-Portal And Nyabuswa HC II Regional hospital. Mubende Buwekula HC IV Located in the district hospital. Kalongo HC III Located near Kiganda HC IV Soroti Diana Memorial HC III Located near Soroti District hospital and Tirir HC IV

It was also noted that the health workers in some of these HCs have taken advantage of the short distance and keep referring even minor cases to the main hospitals. This may render them less relevant as patients always prefer well established hospitals to lower HCs. There is still a low coverage of HCs compared to the national guidelines as shown below:- • Bushenyi district has 89 parishes out of 170 accessing health services within a radius of 5 km. This represents coverage of 52.35%, • Kabarole district has 45 parishes out of 58 accessing health services giving coverage of 77.5%, • Kamwenge districts has 25 parishes out of 51 accessing health services giving a coverage of 49%,

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• Mubende district has 35 parishes out of 91 accessing health services giving coverage of 35.5%. The poor accessibility to health facilities has caused among other factors the low levels of immunization of babies and mothers. Mothers find it difficult to travel long distances with babies and also the medical workers encounter difficulties when extending out reach services. The level of completion of immunization by mothers and children is on average 19% and 77% respectively. Children are expected to finish their immunization before the age of 1 year, but many still receive it late. For example, between 2002 and 2005, on a yearly average, 101,560 and 209,472 Children received BCG and Measles dosages respectively very late as shown in the table below:

% of % of Measles children TT BCG under BCG 1 - Measles 1 - TT Dose 1 completion under complete Dose 5 1yr 4yrs 4yrs of TT Dose 1yr dosage in Year time

2002 448,599 83,649 19% 1,098,266 135,985 854,853 250,783 78%

2003 456,136 85,403 19% 1,129,474 115,751 835,672 216,177 74%

2004 510,053 99,580 20% 1,284,942 96,950 1,012,038 214,651 79%

2005 416,028 80,947 19% 953,907 57,553 755,533 156,275 79%

Average 457,704 87,395 19% 1,116,647 101,560 864,524 209,472 77% Source: MOH- Annual Health Sector Performance Reports.

8.3 CONCLUSIONS

8.3.1 Funding

• Delivery of health services is largely funded by central Government and Development Partners with minimal/nil contribution by local governments. • There are delays in the release of funds at MOFPED and district levels due to delays in notification, under staffing in the accounts departments, delays in processing of payment and late accountabilities.

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• Disbursement of funds is irregular and inadequate installments disrupt the districts and HSD plans designed to achieve HSSP objectives like timely completion of constructions. • Lower HCs do not participate in the budgeting process and this has resulted in some requirements at HCs lacking adequate funding, for example, maintenance of buildings and cleaning of compounds. • Whereas the MOH uses a standard formula when allocating funds to districts, there is no formula used by districts and HSDs to allocate funds to lower health units leading to inequitable allocation and utilization of resources. • The formula used by MOH in allocating funds to district and referral hospitals is unrealistic because hospitals have since surpassed their official bed capacities. • The objective of funding NGO health units to decongest government HCs has not been achieved because of the user fees charged. • Accountabilities of funds released to NGO hospitals are not checked and submitted in time. • Diversion of funds in some HC affects service delivery and increases the acute drug stock outs experienced. • Accumulation of funds on bank accounts pending utilization in some HCs may lead to delay or suffocation of service delivery especially when health activities are not financed and it can also lead to misappropriation of funds.

8.3.2 Equipment

• The absence of asset/inventory registers can easily lead to asset misappropriation and difficulties in verifying and identifying equipment gaps. • Low level of equipment maintenance leads to constant breakdowns which hamper health service delivery. • The level of equipment utilization was found not satisfactory thus affecting health service delivery. • The vehicles given to HSDs as ambulances are not well designed and can therefore, not satisfactorily be used as ambulances. • Delivery of emergency and referral services is affected by poor or lack of communication equipment and ambulances. • Lack of equipment at lower HCs has led to minor cases being referred leading to congestion of patients in district and regional hospitals.

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8.3.3 Drugs

• Lack of information sharing amongst the MOH, districts and HCs concerning drug allocation under the credit line method has led to poor stock management. • Non-compliance with the drug delivery procedure and schedule issued by NMS has led to late delivery of drugs. • Delayed collection of drugs from the districts by HSDs leads to drug shortages. • Reconciliation of drugs procured under the credit line between NMS and districts, HSD and HCs are not prepared to monitor drug utilization and account balances. • Drug stores records in some HCs are not kept and this coupled with limited segregation of duties can lead to drug leakages going unnoticed. • Poor stores management skills lead to inappropriate store records which in turn causes delayed identification of drug stock outs and expired drugs. • HCs lack proper drug storage facilities which results in exposure of drugs to bad weather conditions and theft.

8.3.4 IEC Materials

• The development and design of IEC materials is centralized at the MOH headquarters and may lead to the intended message not getting to the target groups since words and symbols may mean different things when translated in different languages. • There is low coverage of IEC materials leading to less awareness and participation of the communities in preventing and controlling disease. • IEC materials are not developed in all local languages and symbols leading to ineffective delivery of the intended message.

8.3.5 HC Buildings

• Districts have completed health structures that have not been put to use thus denying the communities access to health services. • Districts have incomplete structures which do not add value to health service delivery and continued construction of both new and old structures puts pressure on the already limited funds. • Districts have some poorly constructed structures which will require more funds to put them to effective use.

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8.3.6 Staffing

• Decentralized recruitment of staff leads to staffing gaps and poor deployment of staff and this compromises the delivery of health services. • Districts do not have a clear policy on training and mainly depend on adhoc workshops, conferences and training organized by MOH. • Lack of a clear policy on staff transfer and rotation has led to congestion of health workers in urban areas and acute staffing gaps in rural and remote areas. • Irregular appraisal and supervision of staff has led to less commitment by staff in delivery of health services.

8.3.7 Monitoring and Evaluation

• There is a break down in supervision visits under the referral hospital system. • Monitoring and evaluation is not regularly carried out in accordance with guidelines leading to laxity by districts and HCs in providing quality health service. • The HMIS is not used properly causing delays and lack of sufficient information for decision making.

8.3.8 Accessibility

The distribution of some HCs was not in accordance with national guidelines and this affected the delivery of health services.

8.4 RECOMMENDATION

8.4.1 Funding

• The activity based budgeting system used by MOH should be operationalized at HSD and lower level HCs. • There is need to enforce MOH Standard guidelines on the disbursement and accountability of funds at districts, HSDs and HCs. • Funding to NGO HCs should be limited to those offering free health services. • There is need to enforce adherence to the terms and conditions set in the MOU between GoU and NGO hospitals.

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• MOFPED should be encouraged to disburse funds as and when needed by districts with minimal variations between quarters to enable districts, HSD and HCs implement their health programmes without delay. • There should be a clear and standard method of book keeping in all districts, HSDs and HCs and which should be regularly reviewed.

8.4.2 Equipment

• A system of keeping the inventory and detailed status of equipment should be maintained in all HCs so as to provide information needed for planning, budgeting, procurement and maintenance of equipment. • MOH engineering department in collaboration with the regional workshops should carry out routine checks on the equipment to avoid eventual break-downs. • Procurement contracts of specialized equipment should include a clause for after-sales service. • The vehicles should be re-designed as ambulances to reduce on their misuse.

8.4.3 Drugs

• The credit line method of drug procurement should be made more transparent to allow districts, HCs, politicians and health management committees access information on how much has been allocated and for reconciliation purposes. • If NMS can not meet increasing demands of the HCs, the districts should be allowed to buy drugs from the other approved suppliers without hindrance (certificate of non availability) and MOH should have more pre-qualified companies added on its list. • The system of recording drugs at the HCs should be improved to ensure proper management of stock levels and utilization of drugs. • The drug ordering system should be automated and centrally controlled at the HSDs to reduce ordering time. • MOH should devise a mechanism such that drugs with short shelf life or those about to expire are exchanged for other drugs from other HCs to avoid incidences of some HCs having expired drugs yet others experience stock-outs for the same drugs. • Delivery time of drugs to health facilities should be improved.

8.4.4 IEC Materials

• The districts should be involved in the design and development of IEC materials to

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increase local acceptability. • The provision and continuous distribution of IEC materials for the various maternal and child health programmes in local languages should be encouraged. • IEC materials should also be put in other public places apart from premises at HCs. • There is need to develop IEC materials for all health interventions and not concentrate on a few health programmes.

8.4.5 HC Buildings

• The practice of districts budgeting for new constructions before first completing the older ones should be discouraged. • The districts should require contractors who provide unsatisfactory constructions to compensate them. • District engineers who certify unsatisfactory works should be disciplined. • HCs should be encouraged to include routine maintenance and security of facilities in their budgets. • Regular and effective supervision of construction of health facilities should be encouraged by MOH through its Health Infrastructure Division and the district engineering departments. • There is need to improve on the selection process of contractors at the districts and early development of tender documents for civil works.

8.4.6 Staffing

• There is need for more comprehensive and coordinated human resource planning involving districts, HSDs, HCs and MOH. • The recruitment system of health workers should be centralized i.e recruitment adverts should be for the country and not specific districts. Also, clear policies on transfer and rotation of staff in order to retain staff in hard to reach areas should be developed. • District staff ceilings should be arrived at by the MOH after a thorough staff needs assessment of each district. • Districts should develop clear policies on training of the medical staff and also carry out training needs assessment for its staff. • Staff appraisal forms should be regularly updated to include relevant information and

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recommendations of supervisors should be taken into consideration to aid decision making. • Organizational structures of HSDs should be enriched to accommodate the post of an administrator to relieve doctors from administrative work which hinders them from concentrating on health duties.

8.4.7 Monitoring and Evaluation

• In addition to the discussion of the monitoring reports in general terms at workshops and seminars, each district, HSD and HCs should receive feedback on their respective reports to enable them implement the recommendations specifically applicable to them. • MOH should develop a mechanism to ensure accurate and timely completion of HMIS forms by districts, HSDs and HCs to improve on the quality of reports and decisions made on the basis of HMIS. • Districts, HSDs and HCs should be encouraged to generate reports from the HMIS and use them to improve on their performance. • All information assistants in the districts, HSDs and HCs should be adequately trained to input data and should be provided with the necessary tools to enable them generate accurate and reliable reports. • District administrators and politicians should be encouraged to conduct multi-sectoral monitoring of all government programs. • The referral hospital support supervision system and consultants out reach programme should be re-activated to improve health service delivery at HCs.

8.4.8 Accessibility

• MOH guidelines on distribution of HCs should be followed and districts which do not find it practical, should inform MOH so that where justifiable, authority is given for a deviation to avoid deviations which could lead to over concentration of HCs in particular areas at the expense of others. • Districts and HSDs should plan to increase the number of out-reach activities in maternal and child health programmes like child immunization and family planning to overcome the low coverage in remote and difficult to reach areas.

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9.0 UNIVERSAL PRIMARY EDUCATION PROGRAMME (ISSUED 2005)

9.1 INTRODUCTION

The management of the Capitation Grants (CG) and the School Facilities Grants (SFG), which are the main components of the Universal Primary Education programme have been reviewed by me. This report focuses on the following aspects of the programme:

• Management of the construction and completion of classrooms, latrines and teachers’ houses under the School Facilities Grant. • Funds flow and management of Capitation Grants. The primary objective of this audit was to evaluate the economy, efficiency and effectiveness with which these grants have been utilized.

9.1.1 Background information on the Universal Primary Education Programme

The Government of Uganda (GoU), in a bid to ensure that all children in the country received some basic education, declared free primary education in 1997. Initially the programme was to cover 4 children per family but was later extended to all children of primary school going age. The MoES is charged with the implementation of this policy. GOU extends grants to all government aided schools and until the financial year 2002/03, to some private schools. These grants are; the CG which is used for maintenance and general upkeep of the pupils at school and the SFG which is extended to schools for construction and completion of classrooms, teachers’ houses, latrines and acquisition of furniture. Both grants are conditional and releases are made upon satisfaction of accountability requirements for previous disbursements. By achieving universal primary education, GoU would be fulfilling its mission of eradicating illiteracy while equipping every individual with the basic skills and knowledge with which to exploit the environment for both self and national development.

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9.1.2 Financing

The UPE programme is financed from the Poverty Action Fund (PAF) which is a comprehensive strategy for alleviation of poverty through grass root projects. The UPE, like other PAF activities, is financed by Government of Uganda, HIPC debt relief savings, general aid and specific donor funding. The main donors for the UPE programme are; The Netherlands, Sweden, United Kingdom, Ireland and Belgium. The EU, USAID, IMF, IDA and UNICEF also substantially contribute to the programme.

From its inception until June 2001, over 250 billion Uganda Shillings was spent on this programme as shown in the table below.

Amounts Released in Uganda Shillings for each grant per Financial Year Financial Year Capitation Grants School Facilities Total Amounts Released Grant 1996-1997 14,180,619,449 - 14,180,619,449 1997-1998 26,220,673,559 - 26,220,673,559 1998-1999 31,663,139,112 58,126,966,367 26,463,827,255 1999-2000 38,407,522,000 72,633,496,500 34,225,974,500 2000-2001 46,740,000,000 92,850,176,977 46,110,176,977 TOTAL 157,211,954,120 106,799,978,732 264,011,932,852

UPE RELEASES

50 40 C apitation 30 Grants

SHS. 20 School 10 fa c ilitie s g ra n t 0

AMOUNTS IN BILLION 7 8 9 1 9 9 0 99 -1 96-19 97-19 98 99-2000 00-20 9 9 0 1 1 19 19 2 177 FINANCIAL YEAR

9.1.3 Reasons for the Value for Money Audit

The audit was motivated by public concern about the programme and hence the need to assess whether there has been value for the money spent so far on the UPE programme. As demonstrated from the graph above, the trend of releases has been increasing and by 2000/01 over 69% of the education sector budget was allocated to primary education. Despite this, there have been repeated complaints by stakeholders about the poor quality of classroom constructions and compromised delivery of other educational services under this programme. If these funds are not put to the intended use, there is a risk of failure to achieve the UPE programme objectives.

In addition, under the Education Strategic Investment Programme (ESIP), the year 2003 is a milestone by which UPE will have been achieved and it is therefore timely to conduct this audit to assess whether value for money has been achieved over this 5-year period.

9.1.4 Scope of the Audit

The audit focused on two major aspects of the Universal Primary Education programme, the Capitation Grant (CG) and School Facilities Grant SFG. Our review covered the period July 1997 to June 2001 and focused on 10 of the 56 districts in Uganda. No schools were selected from the Northern Region due to the insecurity in that region at the time of the audit.

School Facilities Grant

Our work was carried out with the objective of determining if; i) The school construction programme had been properly planned at the beginning of the programme by the Ministry of Education and Sports, ii) The design of the schools was acceptable and the drawings produced adequate to attain the objectives of the SFG, iii) The quality of the schools and classrooms built is acceptable and meets the requirement that the facilities will have a useful life of at least 30 years,

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iv) The monitoring of the construction process was carried out properly and in an effective manner, v) The tendering process was followed, vi) The Capitation Grants are efficiently managed.

Approach

Given that the schools and classrooms are the main focus of the SFG, we used the total population of classrooms constructed during the period under review as our sample population. We then used a statistical approach called monetary unit sampling to select a representative sample to audit. Ten districts were chosen at random from the 56 districts. We excluded the northern region due to insecurity in the area at the time of our audit. A computer programme designed to extract samples of this nature was utilized on the data provided by the Ministry and 140 schools were identified to be visited from the 10 districts selected. An added bonus to this sampling method is that it allows us to project the monetary value of the defects of the schools in the sample over the total number of classrooms built nation-wide to arrive at an estimated loss to the national treasury from the deviations from the accepted norms of construction and monitoring.

In those instances where we found other problems outside of our statistical sample, they were also considered but do not form part of the monetary evaluation of the sample.

9.1.5 Districts selected for the sample The table below summarises the data utilised to select the sample and the resulting sample areas

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Data on sample selection

School Facilities Grant Detail Central Region Eastern Western Northern Region Region Region Amount in shillings disbursed in each region 22,317,613,148 28,522,749,900 28,987,846,967 27,622,209,020 Total amount disbursed in the N/A districts selected (see below) 7,527,497,678 7,215,508,754 4,203,970,000 % of districts selected in each 41.67% 18.75% 13.33% 0.00% region SFG Sample 33.7% 25.3% 14.5% - Capitation Grant Amount in shillings disbursed in each region 38,145,762,066 40,712,673,919 40,708,295,006 31,177,912,961 Total amount disbursed in the N/A districts selected (see below) 18,674,106,541 11,693,607,985 4,071,142,081 % of districts selected in each 41.67% 18.75% 13.33% 0.00% region CG Sample 48.95% 28.72% 10.00% 0.00%

Districts selected in each region Central East West Kampala Mukono Katakwi Kisoro Mpigi Tororo Ntungamo Kayunga Iganga Nakasongola

9.1.6 Planning

The initial planning carried out by MoES in arriving at the way the UPE was going to be implemented was not reviewed because during our preliminary review of the programme, we found that the Ministry did not carry out adequate planning. There were no time bound performance indicators established then and there were no benchmark criteria against which their performance could be measured. For example, the MoES set out to achieve a classroom/pupil ratio of 1:55 without indicating by when this should be achieved. Instead medium term moving targets are set.

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9.1.7 Capitation Grant

The objective of the Capitation Grant is to improve equitable access to basic education by providing the resources necessary to run primary schools. Our review was focused on; a) Review of the timeliness of the disbursements of funds to the schools by the Ministry of Education and Sports, b) Review of the funds disbursement procedures put in place by the ministry, c) Monitoring of the disbursements by the Ministry, d) Use of funds by the districts once the funds have been disbursed.

9.1.8 Performance of UPE Programme

Since inception in 1997, the UPE programme has produced the following results in the areas of enrolment, number of primary schools, classrooms constructed and increased number of teachers. Below is the summary of these achievements

Indicator 1996 (Before UPE) 1997 2001 Enrolment 3 Million 5.3 Million 6.9 Million Primary schools 8,500 10,000 12,280 Classrooms No reliable statistics No reliable statistics 66,300 Teachers 81,564 89,247 127,038 Number of children N/A 4 per family All children of school going age entitled to free Education

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9.2 SCHOOL FACILITIES GRANT: MANAGEMENT OF CONSTRUCTION AND COMPLETION OF CLASSROOMS, LATRINES AND TEACHERS’ HOUSES

The SFG started in the 1998/99 financial year and was aimed at reducing pupil classroom ratio by constructing and completing existing classrooms, latrines and teachers’ houses. The target was to offer permanent classrooms to as many primary schools as possible with priority given to those with very high pupil:classroom ratio and those schools and areas that lack permanent structures.

Pupils of Kidibya P.S studying under a tree

Pupils of Kidibya P.S taking end of term examination in a new classroom without furniture

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Targeted and Actual ratios.

Ratio Target Actual

Classroom : Pupil 1 : 55 1:94

Latrine : Pupil 1: 40 1: 170

Teachers’ Houses18 89,209 21,12819

MoES produced general and technical handbooks that contain guidelines for these constructions and these estimate the SFG structures to have a minimum life of 30 years. During the course of this audit, the following issues emerged that need to be addressed by the various UPE implementing agencies;

Delayed completion of construction works

1. Unsatisfactory construction works 2. Conflict of interest 3. Abuse of SFG facilities 4. Inappropriate allocation of facilities to schools

18 Based on MOES statistics for 2001 and 19 Includes 4,734 Houses which were under construction

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5. Too much bureaucracy in commissioning completed structures. 6. Other observations • Wide variation in sizes of classrooms for completion under SFG • Inappropriate basis for allocation of monitoring funds • Non-deduction of Withholding tax

9.2.1 DELAYED COMPLETION OF CLASSROOM CONSTRUCTION

Funds for construction of classrooms in a particular quarter are often released in advance on the basis of a District/municipality work plan that is agreed with and approved by the MoES. Contracts are then awarded and a contract is signed between the SMC and the contractor. All constructions are supposed to be completed within 3 months from the commencement date specified in the contract. The following were noted;

9.2.2 Delay in payment of contractors The agreement between the district and the school community requires that certificates for works completed should be settled within one week of presentation.

It was established that many districts take more than one week to settle certificates and there are extreme cases like Tororo district, which took over 4 months to process some certificates. Furthermore many contracting firms/persons had little financial ability to pre-finance more than one stage of the contract and were therefore dependant on payments of certified works to finance subsequent stages. For such contractors, delays in settlement of certificates resulted in delay in completion.

9.2.3 Delays in award of tenders Some districts receive SFG funds and take up to 3 months before awarding tenders for construction works. This affects the number of classrooms constructed in a given quarter and impacts on the attainment of the overall targeted classroom : pupil ratio.

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9.2.4 Influence peddling The SFG tender agreement requires that payments will only be made for a stage of construction that has been satisfactorily completed and approved by the standard SFG certificate of works issued by the district. In addition retention money is to be paid after the defects period of 6 months. Furthermore, sites are supposed to be completed within 3 months of commencement.

It was established that many contractors obtained certificates for stages not completed and went ahead to get full payments in advance inclusive of retention fees. This irregular practice removes the incentive for the contractors to complete the works in time and as a result many of these sites overran time in some cases by over two years. Examples of such cases are shown in the table below.

Extreme examples of payments for incomplete works in sampled districts.

District School Contractor Contract Amount Status of works on Expected amount inspection completion Paid Date Ntungamo Rwanda P.S Mutunzi C 35,000,000 34,443,825 Roofing incomplete Nov 2001 Ntungamo Bujuzya P.S Mubangizi H Latrine collapsed before Nov 2001 completion & classroom 35,000,000 34,443,825 Finishing not complete Iganga Bulunguli P.S “SMC” 24,760,000 23,522,000 Done up to roofing Aug 2001 Iganga Busuyi (1) P.S Done up to roofing Mar 2000 8,578,000 8,149,100 Iganga Busuyi (2) P.S Done up to roofing Mar 2000 8,578,000 8,149,100 Iganga Bugomba P.S Done up to roofing Mar 2000 8,578,000 8,149,100 Abwanget Kuju Pioneer co. of Partly roofed Mar 2002 Katakwi P.S Amuria 11,708,000 11,708,000 Angatuny P.S Larry Water System not done Nov 2001 Stationers valued at 2,314,242/= Katakwi and several deviations 25,418,000 25,418,000 from Technical. Specs. Odiding P.S Pioneer co. of Partly roofed Dec 2001 Katakwi Amuria 20,616,000 20,616,000 Tororo Kachonga P.S: Ludo Partly plastered Feb 2001 Classrooms Enterprises 17,156,000 17,156,000 Kachonga P.S: Welfare Not delivered after 2 Feb 2001 Furniture Agencies (Ally years Hamya) 2,700,000 2,700,000

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It was also observed that SFG classrooms at Bulunguli P.S had been commissioned by MOES officials as complete yet the walls were not plastered, the window bars were smaller than those recommended and the classrooms neither had a concrete floor nor a blackboard. These classes were in use at the time of inspection. Such gestures compromise the efficiency and effectiveness of SFG contractors.

Conclusion The objective of achieving the targeted classroom: pupil ratio could not be achieved because of these weaknesses.

Recommendations a) District Tender Boards must endeavour to award SFG tenders during the first 2 weeks of the quarter if not, immediately the District receives funds. b) Districts must adhere to the SFG guidelines that require release of funds to SMC within one week from certification of stages completed. c) District administration and leadership must only make payments for stages completed and certified; engineers who certify stages as complete when they are not, exhibit professional dishonesty and appropriate action may be considered by the respective District Service Commissions.

9.2.5 Delayed commissioning of complete structures

On completion of SFG sites, a final certificate is supposed to be issued confirming that a site is ready for use and it is then officially handed over to the district which commissions and hands the classrooms to the school for use.

It was observed that some structures though complete, are not in use because they have not been officially commissioned. For example in Mukono district, over 24 SFG sites were completed by 31st July 2002 but were not in use 4 months after completion because they had not been commissioned. This was also the case at Wera P.S in Katakwi district.

Conclusion Delayed commissioning of SFG structures works against the programme since it delays use of completed facilities and this delays reduction of congestion in classes.

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Recommendation It is recommended that commissioning be done immediately on issue of the completion certificate provided that the structures are proved to be completed.

Latrine at Jinja Misindye delayed by over 6 Months

9.2.6 Unsatisfactory Construction of SFG Structures

Classrooms completed under the SFG programme are expected to have a minimum life of 30 years and conform to the quality and design contained in the technical handbook.

Construction works physically inspected on the sampled schools with the assistance of engineers from the MOWHC20 and engineering assistants from MoES revealed that many of the construction works are not to the standards set in the technical guidelines and can not stand the 30-year test. In extreme cases structures collapsed before they were completed.

1. 20 Ministry of Works, Housing and Communication

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Constructions fully paid for but the facilities were not put to use.

District Schools Construction Status

Ntungamo Nyakariro P.S, Bujuzya P.S Latrines Collapsed before use

Katakwi Obalanga P.S Latrines Collapsed before use

Nakasongola Busone P.S Latrine Condemned

Tororo Mabaale P.S Classroom Condemned before completion

Condition of Classroom sites inspected

District Good Fair Bad Very Bad Kisoro 90% 10% 0% 0% Kayunga 86% 14% 0% 0% Mukono 67% 33% 0% 0% Nakasongola 80% 5% 10% 5% Tororo 64% 36% 0% 0% Ntungamo 54% 46% 0% 0% Katakwi 50% 29% 21% 0% Kampala 36% 36% 0% 27% Mpigi 27% 33% 27% 13% Iganga 11% 44% 44% 0% The districts of Katakwi, Kampala, Mpigi and Iganga had the worst performance in terms of classroom construction

Condition of Latrine sites inspected

District Good Fair Bad Very Bad Tororo 94% 6% 0% 0% Kisoro 70% 20% 0% 10% Mukono 63% 0% 0% 38% Mpigi 64% 9% 0% 27% Kayunga 60% 20% 20% 0% Ntungamo 45% 45% 9% 0% Iganga 33% 0% 33% 33% Nakasongola 25% 31% 25% 19% Katakwi 14% 14% 29% 43% Kampala 17% 33% 17% 33% Iganga, Nakasongola, Katakwi and Kampala ranked worst in terms of latrine constructions

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From the site inspections it was established that there was an estimated overall loss of about 16% (UShs.4.5 billion) in the sampled districts over the 3 year period. If this is extrapolated it translates into a countrywide loss of value of about Ushs.15 billion

These unsatisfactory works are mainly attributed to the following

• Ineffective supervision and monitoring • Commencements of sites before tenders are awarded or before contracts are signed • Payments made to contractors without full certification • Incompetent contractors • Inequitable appropriation of monitoring funds • Use of inferior materials by contractors to achieve savings • Poor technical appraisal of schools for completion

9.2.7 Ineffective supervision and monitoring

SFG guidelines highlight the SMCs, District Technical Supervisors and district political leaders as the principal monitors of the SFG programme. It further states that Shs 400,000 will be availed per SFG site to technical supervisors while the political supervisors will be funded from the multi-sectoral PAF Monitoring and Accountability Grant. The guidelines also give a standardised format for reporting expenditure on district monitoring (Form 9). This form is signed by all the concerned inspectors to attest to their inspection and visit. This is to be submitted upon inspection of each site. For the SMCs a site supervision form was designed and is included in the technical handbook.

It was established that in all cases funds were paid to the various monitoring teams and in many districts Form 9 was attached to payment vouchers as part of the accountability but out of all the sites inspected in sampled districts 45 % had unsatisfactory work.

This is evidence that Form 9 may merely be used as a formality rather than proof of actual monitoring and as a result it appears that many certificates are issued without sites being inspected.

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It was also established that there is insufficient sensitisation of SMCs on what they are supposed to do and how they are supposed to do it and they hardly make use of the technical handbook when undertaking supervision. As a result the benefit of monitoring by SMCs appears not to have been realised.

Conclusion The supervision and monitoring were not effective resulting into unsatisfactory work being certified and approved for payment.

Recommendation • MOES and district authorities must conduct effective monitoring of SFG sites rather than the current accountability oriented supervision. MOES should also monitor the monitors to ensure that they do carry out their work in a professional manner

• SMCs should be sensitised on what they are supposed to do and how they are supposed to do it.

9.2.8 Commencement of sites before tenders are awarded/contracts are signed

The District Tender Board awards SFG tenders to successful contractors and then contracts are signed between the SMC of the beneficiary school and the contractor. Upon signing, the contractor is supposed to commence construction.

It was established that occasionally contractors start constructions before tenders are awarded or before contracts are signed. In such cases the technical supervisors are unaware of such constructions and therefore do not supervise the work done. In some cases it was too late to recommend re-works, as was the case in Kyayi P.S and Kewerimidde P.S in Mpigi district and Nyada P.S and Adepar P.S in Katakwi district.

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Conclusion This irregularity erodes the benefit of stage-by-stage monitoring prescribed for SFG sites and yields unsatisfactory works.

Recommendations It is recommended that no payment should be made in respect of unsupervised work and any commencement of construction before award of tenders or before the contract is signed must not be paid for from public funds.

9.2.9 Payments made without full certification

On completion of each stage of construction, the District Engineer/Supervisor issues a certificate. The, Sub-county Chief and the Head Teacher are required to sign the certificate. In addition, an Engineering Assistant from MoES (who is independent of the district) is supposed to certify all stages of SFG constructions. Payments are supposed to be based on fully signed certificates.

A review of paid certificates revealed that some contractors are paid against certificates that are not fully signed. This practice was common in Tororo Municipality and Katakwi District. Although MoES issued several circulars to districts urging them to restrain from this practice, most of the sampled districts ignored it.

Conclusion In my opinion, certificates that are not signed by all signatories put to doubt the quality of the construction works and reduces the value for money assurance given by these certificates.

Recommendation Since SFG is a conditional grant, it is recommended that MOES establishes a disciplinary mechanism for officials who make payments for works not fully certified.

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9.2.10 Incompetent contractors

The SFG guidelines require SMCs, assisted by the District Engineer to identify, appraise and nominate three qualified contractors to the technical evaluation committee of the District. The committee then evaluates and recommends them to the District Tender Board for consideration and award. The successful contractors are supposed to follow the specifications in the technical handbook.

From works inspected, it was established that many of these contractors were unable to interpret technical specifications. As a result, basic technical omissions and commissions were made such as fixing doors inside out, ramps being built out of proportion, and door hinges for latrines being placed on the wrong side of the frames making their access very difficult.

The selection of incompetent contractors was attributed to disregard by the tender board of technical committee evaluations and the SFG contractor procurement system prescribed by the guidelines.

9.2.11 Disregard of technical evaluations

While S.80 of the Local Government Act allows the District Tender Boards to deviate from recommendations of the technical evaluation committee if their decision does not cause financial loss, many tenders awarded this way often resulted in unsatisfactory works. In Katakwi district this practice resulted into a few contractors dominating although their previous quality of works was poor. Some of these contractors exhibited incompetence and were often defiant in making good the defects as instructed by the engineers.

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Examples in Katakwi District

Recommendations by Status of Reason for works on deviation inspection

SFG technical District Tender evaluation Board School Sub-county committee Nyada P.S Kapelebyong Strong reservations Amuria Farmers commenced V. Poor about Amuria before tender Farmers award Alogook P.S Katawi commenced V. Poor before tender award

Adepar P.S Acowa Strong reservations Amuria Farmers Poor about Amuria Farmers Olekai P.S Asamuk Amuria Farmers Poor

Recommendation The District Tender Board must make use of evaluations done by the SFG technical team and where they differ, satisfactory reasons should be communicated to the SFG evaluation committee.

9.2.12 Contractor Procurement

SFG contracts are supposed to be awarded to local contractors seconded by SMCs as part of the poverty alleviation strategy. Although most tenders were awarded on the basis of this requirement i.e. being village /district based contractors, much of the work done by these firms is unsatisfactory. For example, at Bunangwe P/S in Iganga district the SMC changed contractors after the first one had poorly roofed the classroom. At the time we inspected this site the second contractor claimed to have finished roofing but the roof was evidently not firm and the SMC was still unsatisfied.

In addition, under this system, SMCs are prone to manipulation by contractors. Some contractors tender under several names and end up dominating constructions. For example Mr. Etilu undertakes most of the constructions in Katakwi district using more than 5 different firms.

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This weakness coupled with the inability of SMCs to vet and verify applicants was noted at Angatuny P.S in the same district. It was observed that the SMC nominated 3 contractors to the District Tender Board but subsequently another contractor submitted another set of SMC minutes recommending him as the ‘second’ contractor. It was later established that these minutes were fraudulent with many signatures differing from those of the genuine SMC members and many names included were not SMC members but PTA members. In addition, the minutes were signed by the LCII chairman as the secretary instead of the Head teacher. A review of other documents revealed that a tender was awarded to this contractor for Abota P.S but payments were made to Amuria Farmers which also demonstrates the issue of using pseudo names when in substance it is the same contractor undertaking the works.

Conclusion Although the policy of selecting village/district based contractors has good intentions, strict adherence to it may not necessarily result in value for money being achieved in matters requiring technical competence and expertise and may instead yield many classrooms without due regard to their quality.

Recommendations Given the weaknesses in this policy, it is recommended that MoES considers reviewing the tender award guidelines by uplifting the criteria for selection of contractors from merely being district based to also include minimum competencies.

Management’s Response New guidelines, which address most of the issues related to procurement of SFG contractors and monitoring were issued and became effective January 2003.

9.2.13 Inequitable appropriation of monitoring funds

In order to facilitate monitoring of SFG constructions by the District technical supervisors (District Engineer, DEO, CAO & CIA), Shs 400,000 is provided per site as part of the SFG quarterly releases.

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It was established that in some cases the Engineering department, which is the technical department, is inadequately facilitated. For example, in Iganga, the CFO (Chief Finance officer) who is not part of the monitoring team got the same amount as the Works Supervisor who issues all certificates of works. We also found that 74% of the monitoring funds go to the ineligible supervisors and only 36% is spent on the eligible officials of the district. In some districts, contractors offer transport to the District Engineer to visit their sites. These anomalies are attributed to the absence of guidelines on appropriating monitoring funds to the various supervisors which leaves a lot of discretion to the CAO and DEO as to who gets how much.

Conclusion Value for money is not achieved as a result of ill facilitation of technical monitors. This situation also raises questions on the use of monitoring funds disbursed as part of the SFG and if not addressed, may not only constrain but will also compromise the objectivity of the monitoring teams.

Recommendations • The MoES should come up with guidelines on the appropriation of monitoring funds amongst the various monitoring supervisors. • The MoES must recover the funds paid out to ineligible officials.

Management’s Response The new guidelines specify clearly how the Shs.400,000 per site are distributed amongst the district officials.

9.2.14 Poor appraisal of schools for completion

SFG guidelines require that ‘the District/Municipal engineer will check the site, soil and building conditions especially the safety and the durability of the unfinished buildings to be completed.’ Also the Application form for primary school requires that a building for completion must have foundations made of stone or concrete………….” It was noted however that almost all classrooms for completion neither had concrete nor stone foundations. An extreme case was Mabale P.S. in Tororo District where 19 million (92% of the contract sum) was spent on completion of dangerously weak classrooms

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that were condemned even before completion. This is primarily caused by inappropriate appraisals done prior to completion of the structures and as a result of this many classrooms under the classroom completion grant are not of the quality specified by the technical handbook.

Conclusion Little value for money was obtained from the classroom completion grant because of poor appraisal and as a result most structures under this grant will not last the minimum 30 years. In addition, remedial and maintenance costs are likely to be high.

Recommendation • Engineers, who appraise and certify works as fit for completion when they are not, or that stages are complete when they are not, exhibit professional dishonesty and the District Service Commissions should consider disciplinary action.

• Legal action should be considered by GoU against the culprit engineers for causing financial loss.

Management’s Response The Classroom completion programme was phased out with effect from 2002/2003 for the same reasons given in this report.

9.2.15 Remittance of unused funds to Treasury

MoFPED requires that any unused amounts by 30th June must be remitted back to treasury even when they are committed. In some cases SFG funds are received by districts within June and are expected to use all this money within one month. Because of this, all SFG sites for the 4th Quarter in Ntungamo district and Olekai P.S in Katakwi were started and completed within one month. In my opinion, these rushed constructions may result into weak and substandard structures.

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It was also noted that sites which had not been completed by the close of the financial year had to wait for clearance from MOFPED21 before settlement of unpaid interim certificates. As a result, work stalled for over 4 months as in the case of NTURO P.S. in Kisoro.

Recommendations If MoFPED is to take advantage of the merits of this system, it should release SFG funds for the 4th quarter early enough to allow Districts at least 3 months for construction before the 30th of June or if released late, allow 3 months to enable completion of works. Alternatively funds meant for the 4th quarter may be released as part of the following quarter’s release to avoid the tight deadline of 30th June.

9.2.16 Failure by Districts to evoke the penalty clauses

The SFG contract provides that in case of default by contractors, agreed penalties should be imposed for each day delayed from the agreed completion date. It was observed that apart from Ntungamo, no other district sampled takes strong action against inefficient and incompetent contractors. This encourages laxity and delays in constructions and may be one of the reasons for delayed completion works.

Recommendation District authorities must strictly adhere to and evoke the penalty clauses contained in the contract agreements.

21 Ministry Of Finance Planning and Economic Development

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A teachers’ house, Kitchen and latrine at Kagongi P.S in Ntungamo district

7.2.17 Use of inferior materials / non-adherence to SFG technical specifications

MOES produced the technical handbook to guide contractors and the monitoring teams as SFG constructions are undertaken. It was established that many contractors made unapproved deviations from the technical specifications intended to achieve savings on their part. These deviations compromised the quality and resulted in loss of value in these constructions.

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Examples of significant deviations from technical specifications.

District School Facility Variation from guidelines Tororo Aguruguru P.S Teachers’ house Used plain iron sheets instead of Pre-painted Iron sheets Kisoro Sanuriro P.S Teachers’ house Used plain iron sheets instead of Pre-painted Iron sheets Katakwi Angatuny P.S Teachers’ house Water harvesting system with 10,000 Ltr Tank worth 2,314,242/= was totally omitted Mpigi Kyabagamba P.S New construction of Bricks laid stretcher (140mm thickness) instead of classrooms header to achieve wall thickness of at least 200mm Kampala Shimoni Dem. Sch. Latrines Used 4 stance pit to congest 8 stances Kibuye & Bukoto P.S Kayunga Kidibya & many others New construction of Bricks laid stretcher (140mm thickness) instead of in Galiraya classrooms header to achieve wall thickness of at least 200mm Iganga Butende P.S Classroom 2 bars instead of 4 used in ring beam; 32mm gauge completion iron sheets instead of 28mm Mpigi Most SFG classrooms 70% of the classrooms used 8 – 10mm bars instead 16mm iron bars for window frames Katakwi Most classrooms 95% of the classrooms completed / constructed used completed / constructed 8 – 12mm bars instead of 16mm iron bars for window frames Katakwi Furniture / Desks All desks inspected in Katakwi fell short of these dimensions (1500X300X25mm) Tororo Kachonga Pit Latrines Width is 2ft. instead of 3 ft. Iganga Pit latrines under SFG Parents compelled to dig the pit before allocation of Pit in many schools Latrine construction to school. Instead of contractor.

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An incomplete structure without a ring beam at Jinja Misindye P.S in Mukono District

7.2.15 Conflict of interest

The SFG guidelines specifies ineligible contractors as; “……. non district-based firms, a firm/individual that is associated or has been associated in the past directly or indirectly with the district officials and councillors, a firm/individual that in the opinion of the district engineer lacks the necessary technical competence to complete the works to a satisfactory standard, District councillors, officials and those associated with the SFG programme directly or indirectly at all levels.”

It was established that several contracts were awarded to ineligible contractors and this constituted a conflict of interest. As a result, many of them were either delayed or are sub standard.

The table below sets out examples of potential conflicts of interest.

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Examples of possible conflicts of interest

District School Contractor Relationship Comments Tororo Kachonga P.S Hamya Ally c/o Kachonga Sub-county Desks not delivered after 2 years Welfare agencies councillor to the district 36 desks Tororo Kachonga P.S Ludo Enterprises Area MP Classrooms delayed for over 2 years Tororo Mabaale P.S, Tom Daka C/O Husband to Nagongera Structure condemned at roofing Butaleja sub-county Eseri Contractors Councillor stage but 92% payments made Tororo Manafa P.S in Mazimasa sub county Unsatisfactory work; floor Mazimasa sub- councillor completely peeled county Mukono Jinja Masindye P.S Chairman SMC Done up to wall plate & delayed completion /abandoned for over one month in September 2002 Iganga Bulunguli P.S Hon Kirunda Contract was signed Done up to roofing but fully paid for Kivejinja / SMC between SMC & SMC! and is indicated as commissioned by P.S MOES Iganga Mpiita P.S Hon Kirunda Contract was signed Several omissions & weak structure Kivejinja / SMC between SMC & SMC! Iganga Kizuba P.S Councillor at the time of Site abandoned tender award

7.2.16 Abuse of facilities

The main intention of classroom construction was to reduce the Classroom: pupil ratio. It was however noted that in Katakwi District several completed classrooms are used as teachers’ houses. For example in Alogook Primary School two classrooms were being used for teachers’ accommodation yet there were 265 pupils in the P1 class and the teacher’s movement in the class was inevitably restricted. In addition some pupils were studying under trees. It was also noted that several other schools are taking up this undesirable practice. This practice is primarily a result of laxity in school inspection by District officials.

Other schools used the new facilities as stores for grain and charcoal among other things.

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Conclusion If this practice goes unchecked, it may frustrate the SFG programme by not improving the Classroom: Pupil ratio in the beneficiary schools as evident from above.

Recommendation • It is recommended that the district officials identify the need for teachers’ accommodation in some schools but in the meantime these classroom should be used for the purpose for which they were meant and the district monitoring team should always ensure that such incidences do not recur since this and other such practices delay the achievement of the desired classroom: pupil ratio. • MoES should sensitise users on maintenance arrangements after hand over of facilities.

7.2.17 Irrational Allocation of SFG facilities to schools

As earlier pointed out the MoES targets to achieve a classroom : pupil ratio of 1:55 and latrine : pupil ratio of 1:40 . It was however established that while most schools have not yet achieved this target, several schools have Latrine: pupil ratio of as low as 1: 25. This may be an indication that the district officials are not aware of these targets when undertaking the appraisal. In one case at Butawuka UMEA P.S in Mpigi district, which had 24 latrines, the 2- stance SFG Latrine was evidently unused and isolated.

It was also noted that schools in Tororo municipality are over built and appear congested with classrooms. The district administration explained that it was because they receive SFG funds and yet MoES takes long to approve opening of sites for new schools.

Conclusion The decision to allocate latrines and classrooms to schools that are not in need is wasteful and it would have been more effective if these facilities were allocated to more needy schools within the respective District.

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Recommendation • The District appraisal team should always take into account the MoES targets when recommending allocation of facilities to schools. • MoES should consider approval of sites identified by Tororo Municipality for construction of new schools to avoid over congestion.

7.2.18 Diversion of SFG funds

Some schools like Nateete Muslim diverted SFG funds to finance other schools activities and some funds were misappropriated by the headmaster without any accountability. This is attributed to ineffective monitoring and laxity by supervisor.

Conclusion:

Such diversions frustrate the SFG programme and offer no value for money

Recommendations Monitoring should be enhanced and where there are diversions to personal/other use, appropriate action should be taken by the District Service Commission.

7.2.19 Irrational allocation of monitoring funds per site

A flat figure of Shs 400,000 is released per SFG site in respect of monitoring and supervision irrespective of the distance covered and conditions endured by the supervisors. As a result supervisors for schools in municipalities, most of which are within walking distance, are allocated the same amount of money per site, as those for schools in districts like Kayunga where some schools are over 100 Km from the District headquarters. Despite the distance, most roads leading to schools in these remote counties are almost impassable and can only be accessed using a four-wheel drive vehicle. Naturally these would require more funds for monitoring than municipalities.

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Recommendation: This uniform allocation does not reflect the span and coverage of supervision and MoES should rationalise the release of monitoring funds to take into account nature and conditions faced by the respective monitors.

9.2.20 Wide Variations in SFG classrooms for Completion

The classrooms recommended for completion must have a minimum of 33.0Sq. metres. During this review it was established that sizes of classrooms varied widely as demonstrated in the table below:

Varied Classroom sizes

School District Dimensions Total Area Minimum class Size 5.5M X 6M 33.0 Sq. Mts. St. Ponsiano Kyamula Kampala 4.9M X 6.0M 29.4 Sq. Mtrs. Ibulanku P.S. Iganga 5.65M X 6.6M 37.29Sq. Mts. Kachonga Tororo 6.63M X 8.76M 58 Sq. Mts. Ddegeya P.S Mpigi 4.5M X 5.9M 26.55 Sq. Mts. Bukoyo Muslim P.S. Iganga 62.9Sq. Mts.

While the minimum area of a classroom for completion was set at 33.0 sq. metres some structures fell far below this size. For example, at Ddegeya P.S rooms were as small as 26.55Sq. meters and St. Ponsian Kyamula classrooms are as small as 29.4Sq. metres. Not withstanding the small size of classrooms, the construction works were very unsatisfactory and value for money was significantly compromised at these sites.

Another observation was in Iganga District where at the same cost per classroom, the work done at Ibulanku P.S. was of poorer quality than Bukoyo Muslim P.S. yet the classrooms in the latter are 25.61 Sq. meters larger.

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Recommendation Funds committed to completion of facilities should take account of the size rather than the flat rate that was used irrespective of size. This way, savings would be realised from the very small structures and channelled to other constructions.

7.2.21 Non-Deduction of Withholding Tax

It is an income tax requirement that districts deduct 4% from all payments above 1 million shillings in respect of goods and services rendered to districts and this includes SFG contractors.

It was established that in Ntungamo district, Kayunga district and at times Kampala district, this tax was not deducted. Through this tax evasion, these districts pay more to contractors than those districts that comply with income tax requirement. This could partly account for the relatively good work in Ntungamo among other reasons.

Conclusion In the absence of guidelines on taxes associated with SFG constructions, all districts are supposed to deduct withholding tax and non-deduction amounts to tax evasion which is illegal.

Recommendation MoES should explicitly guide districts on the 4% withholding tax

SFG: Conclusion

With the current classroom:pupil ratio of 1:94 against the targeted ratio of 1: 55 the MOES is far from achieving its targets in this regard. If the above inefficiencies and inadequacies are not addressed, the MOES objective of providing permanent classrooms with a minimum life of 30 years to as many primary schools as possible will still be unattainable. Furthermore if corrective action is not taken, a lot of money will continue to be wasted under this programme.

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9.3 Funds Flow and Management of Capitation Grants

The Capitation Grant is aimed at improving equitable access to basic education by removing the burden of paying school fees from the parents and enhancing the quality of primary education by providing resources necessary to run primary schools. This grant is supposed to be provided to schools for all the 9 school months. The funds flow processes and the eventual expenditure at schools were examined and it was found that the main threats to better performance in this area are;

1. Delayed disbursement of funds to schools 2. Inflated enrolments 3. Retention and diversion of funds by districts and schools

9.3.1 Delayed Disbursement of Funds to Schools

It was established that most schools receive funds very late and this inevitably disrupts school activities. In some cases schools take up to 3 months before schools receiving funds. This is attributed to either central government that at times delays to make releases to the districts, or delay by districts to disburse funds to the beneficiary schools.

9.3.2 Delays by Central Government The capitation grant guidelines require that, “Releases will be made twice in every quarter: One ninth (1/9th) of the annual budget of UPE grant will be released in the first month of the quarter to cover implementation during the first month when the District is compiling the required reports for submission to MoES. The balance for the quarter will be released in the second month of the quarter”

Despite this guideline, MoFPED delays to release capitation grants to Districts. For instance, the November 2001 release for Iganga district was transferred to the District grants account on 23/1/02, which is a delay of 2 months. Such delays affect planning at the District and also trickle down to disrupt school programmes. It is worth noting that many schools either receive CG towards the end of the school term or long after the school term has ended.

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9.3.3 Delays attributed to Districts

Delays at the districts are two fold; one is where districts take too long to disburse funds to schools. For instance, Iganga District received funds in May 2000 but did not disburse them to schools until 28th August 2000 a delay of 3 months at the district. The second is where districts fail to submit work plans and progress reports as required by the CG guidelines and therefore sanctions are imposed on the respective district.

9.3.3.1 Bureaucratic processing of funds at the Districts:

Although S.5.(3).d of the Planning and Implementation Guidelines (Capitation Grant) requires that Districts should release UPE funds to schools within the first week of receipt from the central government, most of the Districts / municipalities reviewed do not adhere to this requirement and often release funds after several weeks or even months. This has resulted in schools operating on credit and in some cases the few credit suppliers charge them highly for scholastic materials to compensate for the delay in receiving payments.

Extremes delays from sampled Districts District Release for the Date Received Date of Days taken by Delay month of from Central disbursement to District to (Allow Max. Government schools remit funds to 7 days) schools Ntungamo November 2001 12th Dec 2001 22nd Jan 2002 41 34 Tororo April 2002 5th May 2002 20th June 2002 46 39 Katakwi March 2002 20th Mar 2002 22nd April 2002 33 26 Iganga May 2000 18th May 2000 28th August 102 95

9.3.3.2 Delayed submission of work plans and progress reports by districts. It was established that some Districts delay to submit the annual UPE workplans, quarterly and cumulative progress reports and quarterly workplans / budget requests as required by the guidelines. This automatically leads to delay by MoES to place their financial requests to MoFPED. As a result of this, some districts have had releases withheld/delayed. For example by

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10th September 2002 Bundibugyo district had not filed accountability for the 4th quarter 2001/02 (April – June 2002) and its 2nd release of the 1st quarter of 2002/03 was withheld pending satisfactory accountability. Similarly, the Feb 2002 release for Iganga was withheld until March 2002.

Conclusion This, in my opinion, is inefficiency on the part of the districts and could be avoided to hasten the flow of funds from central government to the schools.

Recommendation: • The current policy of putting sanctions on districts eventually affects schools more than the District officials who are inefficient in filing accountability documents. It is therefore recommended that individual accounting officers be sanctioned/held responsible using disciplinary channels instead of imposing sanctions on districts. • Districts should endeavour to submit required returns on time.

9.3.4 Inappropriate funds disbursement processes Whereas there are guidelines on transfer of funds from Central Government to the district, during this audit it was established that there are no guidelines on how districts should transfer funds to beneficiary schools. As a result districts use different methods some of which are so elaborate and delay transfer of funds as demonstrated below.

9.3.5 Mode of transfer of funds to schools Most Districts reviewed use direct bank transfers to school accounts while others like Kampala District and Tororo Municipality issue cheques to schools.

In my opinion the practice of using cheques is not only uneconomical in terms of stationery and bank charges but is also inefficient since it takes schools longer to have these funds available for their use.

9.3.6 Use of distant banks by Schools Capitation grants flow from MoFPED (BOU) then to district UCB bank accounts from which they are transferred to school bank accounts mainly in UCB branches. It was observed that some schools opt to use banks in other districts when there are nearer UCB branches within their area

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of location. This makes the transfer process longer and is uneconomical since it increases transport costs and reduces the amounts available for other administrative activities of the schools. The table below shows examples of schools in Mukono District that use UCB Nkrumah road branch yet they have nearer banks within the district.

Examples of schools using distant banks in Mukono District School Subcounty Bank used Mugomba P/S Ntenjeru UCB Nkrumah Road – Kampala Butera P/S Ntenjeru UCB Nkrumah Road – Kampala St. Posiano Mubanda Ntenjeru UCB Nkrumah Road – Kampala Namasubi Islamic Kyampisi UCB Nkrumah Road – Kampala

Recommendation

• MoES should advise all districts to adopt the good practice of using direct transfers to school bank accounts rather than issue of individual cheques to schools since this is faster and more economical. • Schools should whenever possible use nearer banks. This will lead to faster processing and savings on transport.

9.3.7 Allocations to administrative costs The CG guidelines provide 10% of a school’s CG to meet administration costs which includes imprest, hire of transport, allowances on official travel, electricity, water, telephones, posters, head teacher’s official travel and emergencies (e.g. sickness).

It was noted that there are districts without any UCB branch e.g. Kayunga and Katakwi Districts; all schools receive their capitation grants through UCB Mukono branch and UCB Soroti branch respectively. This inevitably increases transport costs and in some cases the 10% provision meant for administration is inadequate to even cover the transport costs alone. For example, Kiwenda P.S in Kayunga District received Shs.55,000 as CG for the month of June 2002, travel costs alone to UCB Mukono branch is Shs.15,000 to and fro. In comparison there are schools located within say Mukono town council that do not even incur any transport costs.

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Another peculiar case was in Kisoro where each school has 3 signatories to the account and in some cases they are all required to travel to the bank from as far as Nteko P.S in Nyabwishente sub-county to Kisoro town which is about 60Km. They spend over Shs 30,000 in transport alone which is over 15% of the CG release.

Recommendation

MoES / District should address these exceptional cases since they deprive the programme of a lot of money on transport costs and reduce the amounts available for other school activities.

9.3.8 Inadequate/Ineffective monitoring The planning and implementation guidelines require that MoES, MoFPED and MoLG are responsible for the monitoring and evaluation of UPE implementation at the national level while the DEO/MEO, DIS/MIS and the CIA must carry out supervision and monitoring visits to schools to assess compliance with guidelines, value for money and financial accountability.

It was established that monitoring is still lacking and this has resulted into the following situations;

9.3.8.1 Inflated enrolments Districts are supposed to release capitation grants to schools based on the number of pupils at the beginning of the first term. It was established that some schools had inflated enrolments as deduced from two anomalies;

• The first is where the enrolment submitted to the District was far higher than the highest attendance recorded in the registers at the schools • The second anomaly is where releases to schools from the District exceeded the schools’ entitlement given its enrolment.

The table below shows schools that had possible inflated enrolments since the pupil attendance registers and funds received were not in line with the enrolment.

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Possible inflated enrolments

Districts School Pupil Pupil Enrolment at Entitlement Amount Overpaid Enrolment school due as per received from amounts at District enrolment District in 2002 P1-P3 = 857 1,024,635 Feb =1,376,285 Feb : 351,650 Kayunga Wabwoko P.S P4-P7= 610 Mar: 1,376,285 Mar: 351,650 Total: 1,467 Pupils Apr: 1,175,000 Apr: 150,365 468 Highest Attendance= 281,000 Feb = 614,630 Feb: 333,630 303 Mar = 614,630 Mar: 333,630 Kayunga Namatala P.S P1-P3 = 200 Apr = 504,816 Apr: 223,816 P4 – P7 = 103 June = 431,005 June: 150,005 331 No evidence of Nil Feb, Mar & Apr Feb, Mar & Katakwi Odiding P.S pupils = 689,585 April: 685,585

This practice of inflating enrolments and subsequent release of funds to schools in respect of non-existent pupils is wasteful and no value for money is realised.

9.3.9 Retention of UPE funds at the District

S.3.3.vii of the guidelines on policy, roles and responsibilities of stakeholders in the implementation of UPE requires that District authorities should ensure that all the UPE funds reach schools without retaining any at District headquarters. This is amplified by S.5.3(e) of the UPE capitation grant guidelines which require that “ …… no credits will mix up two or more UPE funds releases. No balances should be retained on any UPE release (to be mixed up with the subsequent release) without the express written authority from MoES.” During this review it was established that most of the Districts sampled did not release to schools all funds received from MoFPED. This part retention of releases implies that schools receive less funds than allocated to fund their budgeted activities.

In some months, Tororo and Ntungamo Districts received CGs before disbursing the previous release to schools (Mixing of releases). Management explained that funds received are

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sometimes too little to be disbursed to schools thus the need to wait for another release so that schools receive substantial amounts. This explanation was however not satisfactory because any release however small would enable the schools offset some of their obligations given the fact that schools often take credit for scholastic materials due to delays in receiving funds. The main cause of this anomaly is ineffective monitoring by MOES as this would ensure compliance with guidelines and generate more accurate enrolments.

9.3.10 Diversion of UPE funds by the Districts/Schools

Under S.4.3 of the guidelines on policy, roles and responsibilities of stakeholders, it is the responsibility of the RDC, CAO and head of inspectorate to monitor and ensure proper use of UPE grants.

During the course of this audit, probable cases of diversion and unauthorised reallocation were noted. In Ntungamo District, capitation grants for the month of November 2001 were transferred to the SFG account on 12/12/01 and diverted to SFG activities. These funds were reimbursed to the UPE account in January 2002 and schools took two months before receiving this money. Diversion at school level was noted at Muhanga P.S in Kisoro District where the head-teacher received a block release of four months i.e. March – June 2002 and arrears for July 2001 amounting to Shs 1,992,309. The head-teacher duly made accountability for all the funds. On verification however, it was established that many of the items indicated as purchased were not delivered. On the contrary, items delivered were not part of the budget approved by the finance committee and most receipts in support of these purchases had inflated prices.

These diversions and unauthorised reallocations are mainly attributed to ineffective monitoring by the relevant officials and deprive schools of much needed resources.

9.3.11 Financial Management at schools

S.5.6(a) of the CG guidelines and S.9.7(a) of the SFG guidelines require that each of these grants must have a separate bank account as a precondition for a school to benefit from these

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grants. In most schools visited, a separate account was maintained for SFG while a single account was maintained for handling CG and teachers’ salaries and all other financial transactions. There were a few extremes like Olekai P.S in Katakwi District where a single account was maintained for SFG, CG, Teachers’ salaries and all financial transactions of the school. As a result, funds meant for SFG may be used for capitation grants or other non- SFG activities.

In my opinion, the existence of these anomalies is attributed to inadequate appraisal of schools before they benefit from these grants and the ineffective monitoring by district officials.

9.3.12 Unfacilitated Monitoring

Kampala District decentralised the education office to division level, Division Education Officers were duly appointed by the District and tasked among others with monitoring UPE funds. Part of their work is to verify and certify accountabilities submitted by schools.

During the course of this audit, it was established that these division education officers hardly go to the schools to confirm procurements that would be a basis for certifying accountabilities. They explained that no funds are availed by the District to the divisions for monitoring and any monitoring done is at the initiative of the division from the divisional revenue, which is often limited. In addition Division Education Officers are neither involved in selection of SFG beneficiary schools nor in the monitoring of sites within their divisions.

Conclusion The achievement of UPE objectives is largely dependant on good financial discipline by both schools and Districts. Any diversion or reallocation of UPE funds would directly affect beneficiary schools, which would not be in position to obtain the necessary scholastic materials and facilities in time. Without effective and adequate monitoring, the above anomalies will continue to hamper the UPE programme.

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Recommendations • The Districts and MoES should conduct more effective monitoring of the UPE programme as specified in the planning and implementation guidelines as well as in the guidelines on policies, roles and responsibilities of stakeholders. It should be result oriented rather than the current accountability oriented system. This will enable capture of more accurate enrolment information, control and prevent diversions and unnecessary retentions as well as offer financial management support to districts and schools. • Given their proximity to schools, Division Education Officers in Kampala District are likely to be more effective and economical if facilitated to do the monitoring of CG and SFG sites, which is currently done by the District officials. • Punitive action may be considered against school / district officials who deliberately inflate enrolments since no value for money accrues to stakeholders from funds spent on non- existent pupils. • MoES should offer guidance to districts where shortfalls in release are experienced.

9.3.13 Capitation Grants released to Private schools

On inception of the UPE programme, there was an increase in enrolment in primary schools and in a bid to cope with this enrolment, GOU approved CG support to private schools that accepted to take on pupils under the UPE scheme. This however ceased at the beginning of financial year 2002/03.

During this VFM audit review, it was established that this arrangement was difficult for MoES to administer since the pupils were still required to pay fees and these schools hardly accounted for capitation grants. In addition the UPE component received by these schools was too small and they could afford to disregard this government contribution. As a result some schools in Kampala District left their cheques uncollected until they went stale.

Conclusion:

In my opinion, this scheme was not effective and little value was achieved from this arrangement since it did not guarantee free education for pupils enrolled in these schools.

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Funds would have been more effectively used if they were allocated to the more needy government aided schools.

Recommendation In future MoES should undertake comprehensive appraisal of its partners before committing funds to activities that may not be effective in achieving its intended objectives.

9.4 SCHOOL FACILITATION GRANT: TECHNICAL APPRAISAL REVIEW

9.4.1 Introduction

This section contains findings from review of the SFG general and technical guidelines and the evaluation done on the various sites inspected with the objective of assessing whether; a) The school construction programme had been properly planned at the beginning of the programme by the Ministry of Education and Sports b) The design of the schools was acceptable and the drawings produced adequate to attain the objectives of the SFG c) The quality of the schools and classrooms built was of acceptable quality and met the requirement that the facilities have a useful life of at least 30 years

A technical team undertook this evaluation by reviewing documents/guidelines used for the execution of the works and carrying out physical inspection and on site physical tests of materials used for construction at the 140 randomly selected sample schools in 10 districts.

9.4.2 Methodology

The following methods were used when undertaking this review: a. A general review of the available documentation from the Consultants to ascertain completeness, consistency and compliance to the established standards and by-laws. b. A three–way interaction between the Engineering Assistants from Ministry of Education and Sports, based at the various Districts; the local community at the sites visited and the technical review team.

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c. An in-depth examination and review of the documentation from the different disciplines, namely Architectural, Structural, Electrical and Quantity Surveying to ensure compliance to the set building standards. d. Analysis of the collected information. e. Conclusions and Recommendations based on the findings by the team.

9.4.3 AUDIT FINDINGS

9.4.3.1 Soil and site Investigations a. Documentation Review A review of the drawings indicates that there may not have been thorough investigations prior to producing the designs. This can be observed when one looks at the design for the foundation where a single design is provided for the whole country with the exception of the earthquake prone areas. Whereas districts have different soil types, this appears to have been overlooked at the design stage in which case sample site investigations should have been carried out before coming up with the foundation designs. b. Site Investigation This is an all embracing term covering every aspect of the sites under investigations. The consultant should have collected and recorded all the necessary data needed to help in the design and construction process of the proposed works. c. Soil Investigation The purpose of carrying out soil investigation is to:

• Determine the suitability of the various sites for the proposed project. • Determine the adequate and economic foundation designs. • Determine the difficulties that may arise during the construction process. • Determine the occurrence and / or cause of changes in soil conditions.

9.4.3.2 Observation There is no evidence that the investigations in (b) and (c) above were carried out. The foundations and all other components of the structures are uniformly designed for all places with exception of the earthquake prone areas as can be noted from the Technical Handbooks. The absence of proper structural designs has resulted into the structures developing multiple cracks especially at the windows and other parts of the walls, including the gable ends. In

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several cases, cracks were noted running from the top of the walls to the foundations. The cause of this in some cases is certainly due to differential settlement, which was not properly addressed. This problem is best witnessed in Nakasongola District at Busoona Primary School, which is in a swampy area near the shores of Lake Kyoga. Here the walls for classrooms are excessively cracked and are failing making the classrooms unsafe to be used by pupils. The pit latrines on the same site failed completely. The sides of the excavation collapsed into the pit and the hanging slab and walls are cracked all over and stand condemned.

Another typical structural failure was noted in Kisoro District where the soils are of volcanic origin and lack substantial amount of clay to bind the soil particles together. At Kibugu Primary School two pit latrines failed with pit sides collapsing. In these cases the design should have provided for wider foundations for the classroom blocks and the pit latrines should have been lined with block work from the bottom. Whereas the soil types were ignored for classrooms and the pupils’ latrines, this to some extent was taken into account when designing the teachers’ houses and latrines.

Since this project involves colossal sums of money, The Ministry of Education and Sports should have ensured that the bearing capacities of soils from the various locations are checked. (N.B: Facilities for such tests are available at The Central Materials Laboratory in Kireka under the Ministry of Works, Housing and Communication). This would enhance the quality and safety of the structures.

9.4.3.3 Classroom Designs

a. Earthquake Zones The structures in these areas are designed to have reinforced concrete columns. One peculiar case of vertical cracks was noted at Rubona Primary School in Kisoro District where cracks even run through a purportedly reinforced concrete column. Technically this is not possible and one could not tell exactly whether there was truly reinforcement or not. Such failures can only be clarified by carrying out further detailed investigations.

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b. Floors and Verandas i) Ground Floor slabs. The floor slab was designed with a thickness of 75mm and reinforced with BRC mesh as shown on the drawings. A look at the materials schedule shows that the BRC mesh is not allowed for (not costed), except for earthquake prone areas. The standard thickness of a ground floor slab should be 100mm if it is not reinforced. The 75mm thick unreinforced slab is therefore one of the causes for the rampant cracking of the floors noted. Furthermore, there is inconsistency in the documents and non-compliance with building standards in this respect.

ii) Floor Concrete Secondly, the drawings indicate 5mm thick screed on the floor concrete. This is far thinner than the minimum recommended thickness of 25mm, unless the designer wanted this screed to be done monolithically, which was not specified in the guidelines. This inadequate thickness is also another cause of the excessive cracking and peeling off of floor screed at the schools visited. It should be noted that such final finishing of the floor cannot be done before walling if it is to be done monolithically, since it would be damaged by the end of the construction.

iii) Verandas and Splash Aprons The technical handbook gives two options of constructing the splash apron. One peculiar option requires the use of stone chipping on compacted murram without concrete / screed. Such an apron is not durable and will not last the recommended minimum of 30 years and in addition it does not prevent grass from growing around the building. In our opinion this is not viable and should not be given as an option.

Another irregularity noted was that the guidelines do not require use of hard core at the verandah below the concrete (ref. To drawing PP/MOE – 3A). This is a major cause of cracking of verandas as the concrete slab settles as noted on several classroom blocks inspected.

d) Walls The walls are designed to have height from ground floor level to the top of ring beam of 2.6m and this is also the roof level. This is contrary to the standards, which recommend a roof level height to be at least 3.0 m for classrooms. Such low roof levels have led to poor ventilation and

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darkening of the inside of classrooms. This is worsened by providing a wide verandah recommended by the technical handbook. In some cases contractors misinterpreted the drawings and provided eaves of over 1.2 m wide at the rear of the buildings.

The low roofs also lead to overheating inside the classrooms, since no ceiling is provided. Due to this, some districts like Ntungamo raise the level of the wall plates to a height of 3.2 m. Although this is good, it has cost implications, which have not been catered for by the guidelines. This has forced contractors to do substandard work in other aspects of the construction like poor mortar mixes to compensate for the extra work on the higher walls and this compromises the strength of the walls. This is possibly one of the reasons for the substandard works and such constructions are prone to failure and expose the pupils to risk of injury.

e) Windows Quite a good number of windows are provided and according to the specification they have rebates for future fixing of shutters. In some districts like Kisoro, due to strong winds and rains, shutters had to be introduced immediately to safeguard the roofs from being blown off. However, these windows are designed with no vents on top as part of the window frame or as permanent vents over since immediately above the window frame is a ring beam onto which, the roof is anchored. This certainly cuts off ventilation and it is in violation of Schedule 1 of the Building Regulations. This poor ventilation will later cause dry rotting to the roof timbers especially during periods when the schools are closed for holidays.

f) Roofs According to the drawings, roof trusses are supposed to be at 2000mm centre to centre. This means that a two-classroom block would have 6 trusses while a two-classroom block with an office and store would have 7 trusses. However the schedule of materials makes no distinction between the two types of classroom blocks and indicates 6 trusses for both. Whereas the schedule of materials shows same number of trusses for the two structures, it gives different cost estimates for the trusses. This therefore is an inconsistency in the technical guidelines.

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g) Roof Overhangs Roofs are designed to have roof overhang supports, which are presumably for providing extra lateral support to the roof. Whereas the guidelines require these overhang supports to be bolted to the walls, no details are shown for the bolting and no cost estimate is allowed for and where they have been provided they are merely nailed to the adjacent roof trusses and not bolted. This therefore means that they are not offering the extra support intended and compromise the durability of the roof.

h) Gussets Gussets are mentioned and costed in the schedule of materials but no details of them are shown on the drawings as to how and where they are supposed to be fixed or used.

i) Lightening Protection Unlike for staff houses, the Technical Handbook for classrooms makes no provision for lightening protection and this puts the children’s lives at risk. For instance, at Kawoomya R/C P.S in Mukono District, a classroom block under construction was struck by lightening and as a result the wall had developed multiple cracks. These conductors should be provided even for classrooms.

j) Soft Boards The Technical Handbook provides for only one soft board (pin board) for a two-classroom block without mention of where it is supposed to be fitted. Is it for one of the classrooms? Or outside the classroom? Is it for the whole school? Or is it for the office? If it is supposed to be per classroom then this should be reflected in the costing. k) Cost Estimates and Availability of Materials The sources of local materials like bricks, sand timber, etc are presumed to be readily available at the respective localities, but this is not actually the case. Another fact that was over looked during the design stage was that some locally produced materials are even more expensive than those that are manufactured elsewhere. This is exemplified in a District like Nakasongola where one finds it cheaper to use a solid steel door than one made out of timber.

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l) Choice of Materials It was noted that some districts like Nakasongola are heavily infested by termites, which have devastated vegetation and buildings. In such areas, it is important to substitute wooden windows and doors with metallic ones, since those fixed are already being eaten away. For this reason, some materials recommended in the guidelines cannot be used in some localities, hence the need for use of alternative materials. Although an anti termite projection is provided, this was done only for new constructions and the treatment of termites was not considered for the structures started by the parents and completed under SFG.

m) Accessibility of Sites The SFG guidelines require that sites selected for construction should be easily accessible to vehicular traffic. However, it was noted that quite a good number of schools in the remote and mountainous districts like Kisoro do not even have Community roads for access to the schools. At Kibugu Primary School the team had to walk for at least 10km to and from the school, using footpaths through gardens.

In this place not even a bicycle can be used as a means of transporting materials to the site. This therefore implies that the contractor has to employ labourers to carry the materials over that distance to the site. This turns out to be costly in terms of time and money, yet such allowances are not catered for in the cost estimates and in some cases are much higher than the contingency provided.

n) Title Block A review of the Title block does not give the following responsible signatories; “designed by”, “checked by” and “approved by”. We could therefore not ascertain whether these drawings were checked and approved by competent authorities.

9.4.3.4 Latrines

i. Pit Latrine Drawings. The drawing of a five-stance pit latrine shows a urinal and its outlet. The details for the drain and soak pit are not given nor are their costs included. In many cases the urinals drain in the

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open, which constitutes a health hazard. In other cases the contractors construct the urinal such that it drains into the pit latrine. No wire netting is provided for the inlet pipe into the latrine. This means that the inlet would also serve as an access for houseflies, which are supposed to be eliminated. It was also observed that no urinals are provided on a two-stance latrine and in our opinion this is where it is more needed than where there are five-stances.

ii. Latrine Costing a. Schedule of materials The team established that there was no costed schedule of materials recommended for the pupils’ latrine but instead a fixed sum of Shs 700,000 per stance is allocated irrespective of the region. This in our opinion was a major omission since it left a lot of discretion to the contractors. This to some extent limited the scope of analysis in this area. It is recommended that the technical guidelines be revised to include this schedule. b. Cost Estimates

A close look at the cost estimates for a two-stance pit latrine for the teachers’ house in Zone One is Shs.3,101,306 while, the cost estimate for a 2-stance pit latrine for the pupils costs Shs.1,400,000. If the bills of quantities were derived on the same basis there should be no reason for this wide discrepancy in the total cost estimates for the two types of latrines.

c. Hand Washing Facilities

Whereas the technical handbook for teachers’ houses provided for hand wash facilities during these inspections we did not come across any teachers’ house with the hand wash facilities yet these are provided for and costed.

In addition there was no provision for hand washing facilities for the pupils, yet they are more vulnerable to diseases and need more facilitation to enhance good sanitation.

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d. Costs for Teachers’ latrine The schedule of materials and costs for the teachers’ latrine implies that the estimates are for a 2-stance latrine yet the grand total is for 5-stances. Such inconsistencies mislead users as to whether the costs are for 2 or 5 stances.

e. Drop Hole Cover In order for vent pipes to protect against houseflies, drop holes should be covered. In almost all the schools inspected, the drop holes were not covered allowing houseflies easy access in/out. This is worsened by use of cowls instead of wire netting on the vent pipes since these have big gaps and offer easy access for the houseflies.

f. Vent Pipe Some of the drawings show one vent pipe for a 5-stance latrine block while one drawing provides a vent pipe per stance i.e. 5 pipes for a five-stance latrine. This is a conflict in the drawings and during this inspection we did not come across any latrine that had a vent pipe per stance. Inevitably contractors chose the drawing that would minimise costs and in the absence of any bills of quantities of the pit latrine, we were unable to establish what the drawings intended.

In addition, the cost of the vent pipe is not reflected anywhere and there is no specification at all for it. So at some schools, contractors used very light gauge, which can even be deformed with a hand and some are already damaged.

g. Disabled Facility The details for the disabled facility are not shown on the drawing for teachers’ latrine, yet a cost estimate can be sited in the materials schedule. This is another inconsistency in the documents.

h. Latrine Walkway The section through the latrine shows that there is no hardcore to be placed below the concrete for the walkway. This therefore is one of the causes for the numerous cracks noted on many of the latrines visited, where the concrete slab at the walkways is failing.

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i. Estimation of Materials There is under estimation of some materials. For example the exact length of the fascia board for a two-classroom block is 53.8 m long but the materials schedule gives 50.4m long. This means a full length of a piece of timber was left out. Such omissions lead to shortfalls in the overall costs.

Wrong dimensions are also given for the 5-stance latrine drawing, for the side width where the overall dimension should be 2800 mm, but the drawing shows it as 5600 mm, twice as big. Similarly the length of the front elevation for a teachers’ latrine is given as 6.65m instead of 2.25m. In both these cases costs may have been overestimated.

9.4.3.5 TEACHERS’ HOUSES The staff houses have not yet developed very serious defects as most of those inspected were still under construction. However, the defects similar to those identified on the classroom blocks were noted on the teachers’ house at Agururu P.S in Tororo District, which had developed cracks at the gable ends.

The following were noted that need urgent attention and review. a. Kitchen A look at the spacing of roof trusses indicates that there is one truss along gridline B-B that is in the middle of the chimney. This truss is definitely exposed to the risk of fire and so is the entire kitchen. This can be verified at the teachers’ house at Agururu P.S in Tororo Municipality. b. Rain Water Harvesting Tank The technical handbook gives a detailed drawing of a 10,000-litre water tank. However in the cost estimates the amount given is for a 5,000-litre tank. This is yet another inconsistency in the documentation.

9.4.4 CONCLUSIONS

The above observations represent inconsistencies in the technical guidelines, oversights, omissions and inappropriate designs. All these point to inadequate planning of the programme at inception. As a result of inappropriate designs and compromised quality at implementation many of these structures will not last the expected minimum life of 30 years.

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9.4.4 RECOMMENDATIONS

• It is recommended that MOES reviews the technical guidelines to address the inadequacies noted above and such reviews be carried out, reviewed and checked by competent authorities. This will ensure that some emphasis is put to the quality rather than the numbers of structures constructed under the programme. • There is urgent need to address some defects that render the structures risky for the occupants. For instance the teachers’ house at Amagoro P.S whose lightening conductor passes inside the house. Also there is need to revise the drawings for the timber trusses in the teachers’ kitchens to ensure that none is placed in the chimney. • It is also recommended that training of contractors should be done to enhance better interpretation of guidelines and as well build capacity in line with PAF objectives.

• Contractors who exhibit incompetence and put up substandard structures should be obliged to correct all defects at their own cost and be excluded from any future contracts.

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GLOSSARY OF TERMS: Abattoir/slaughter Means premises used for the slaughter of animals for consumption or house for feeding animals, these premises should be approved by the veterinary administration. Active Means purposeful and comprehensive searching for evidence of Surveillance disease in animal populations or for verification that such populations are free of specific diseases. Active disease surveillance programmes may be of a catch-all nature to detect any significant disease occurrences, targeted against specific high-threat diseases or designed to monitor the progress of individual disease control or eradication campaigns. Animal Means a mammal, bird or bee.

Animal Check Means examination posts or barriers marked with signs bearing letter point “Q” placed on highways also known as National Stock Routes in high animal disease risk areas. The animal check points operated are either fixed or mobile. Animal for Means an animal intended for slaughter within a short time, under the slaughter control of the relevant veterinary authority. Animal Holding Means a place for isolation and quarantine for animals. Ground Animal Quarantine Means a facility under the control of the veterinary authority where station animals are maintained in isolation with no direct or indirect contact with other animals to prevent the transmission of specified pathogen(s) while the animals are undergoing observation for a specified length of time and if appropriate, testing and treatment. Arrears: Means and refers to (NWSC) accounts receivables of more than 30 days. Border post Means any airport, or railway station or road check point open to international trade of commodities, where import veterinary inspection can be performed. Breeding birds Means birds kept for the purpose of producing hatching eggs.

Case Means an individual animal infected by a pathogenic agent, with or without clinical signs. Commissioner Means the commissioner for livestock health and entomology.

Control Means a programme which is approved and managed or supervised programme by the department in MAAIF for the purpose of controlling a vector, pathogen or disease by specific measures applied throughout the country, or within a zone or in Uganda. Crushes Means strongly built stall or cage for holding cattle safely while they are examined, marked, given veterinary treatment or calves are fed. Day old birds Means birds aged not more than seventy two hours after hatching. (poultry)

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Department Means the department of Livestock Health and Entomology in the Ministry of Agriculture Animal Industry and Fisheries. Diagnosis Means the systematic identification and investigation of a disease from its signs and symptoms. Disease Means the clinical and /or pathological manifestation of an infection.

Disease free zones Means a zone in which the absence of the disease under consideration has been demonstrated by the requirements specified in the terrestrial code for free status being met within the zone and its borders, appropriate official veterinary control Is effectively applied for animals and animal products and their transportation. Disinfection Means the application, after thorough cleansing, procedures intended to destroy the infectious or parasitic agents of animal diseases, including zoonosis; this applies to premises, vehicles and different objects which may have been directly or indirectly contaminated. Disinfestations Means the application of procedures intended to eliminate arthropods which may cause disease or are potential vectors of infectious agents of animal diseases including zoonoses. Early detection Means a system under the control of the veterinary services for the system timely detection and identification of animal diseases characteristics of the system include: a) Representative coverage of target animal population by field services. b) Ability to undertake effective disease investigation and reporting c) Access to laboratories capable of diagnosing and differentiating relevant d) a training programme for Veterinarians and Para Veterinarians for detecting and reporting unusual disease occurrences. Epizootic Means a disease that appears in animal populations.

Eradication Means the elimination of a pathogenic agent from a country or zone.

Fire Hydrant: This is a connection that provides access to a water supply for purposes of fighting fires. Incidence Means the number of new cases or outbreaks of a disease that occur in a population at risk in a particular geographical area within a defunct time interval. Infected zone Means a zone in which the absence of the disease under consideration has not been demonstrated by the requirements specified by the terrestrial code or veterinary authorities as being met. Infection Means the presence of the pathogenic agent in the host.

Laboratory Means a properly equipped institution or family staffed by technically competent personnel under the control of a specialist in veterinary diagnostic methods who is responsible for the validity of the results.

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Livestock Is defined by the department as all animals of veterinary interest that have economic value other than Wild life. For the purpose of this audit, Livestock is limited to cattle, goats, sheep, pigs and poultry. Livestock markets Means place designated and approved by authorities. For trade in livestock and livestock products, under the control of a veterinary authority. Monitoring Means the continuous investigation of a given population or subpopulation and its environment, to detect changes in the prevalence of a disease or characteristics of a pathogenic agent. Non-Revenue Means and refers to the ratio between non-billed water to water Water: produced (m3). Notifiable disease Means a disease listed by the commissioner. As soon as it is detected or suspected, it must be brought to the attention of the commissioner in accordance with the Animal Disease Act. Notification Means the procedure by which the commissioner is informed about the occurrence of an outbreak of disease or infection, according to the provision of the Animal Disease Act. Outbreak of Means the occurrence of one or more cases of a disease or an disease or infection in an epidemiological unit. infection Passive Means the routine gathering of information on disease incidents from Surveillance sources such as requests for assistance from farmers, reports from field veterinary officers and livestock officers, submission of diagnostic specimens to laboratories and the results of laboratory investigations. Routine disease reports may also come from other sources such as abattoirs and livestock markets. Prevalence Means the total number of cases or outbreak of disease that are present in a population at risk, in a particular geographical area at one specified time or during a given period. Ring Vaccination Means the rapid creation of an immune belt around an infected area.

Routine Strategic Means a vaccination of a high risk area based on a risk analysis. Vaccinations Suppressed Accounts off-supply. Accounts: Surveillance Means the investigation of a given population or sub-population to detect the presence of pathogenic agent or disease. The frequency and type of surveillance will be determined by the epidemiology of the pathogenic agent or disease and the desired output. Vaccinations Means the successful immunisation of susceptible animals through the administration of a vaccine comprising antigens to the disease to be controlled. Valley Dams Means big open water reservoirs found between valleys.

Zoonosis means any disease or infection which is naturally transmissible from animals to humans.

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