An inquest into the demolition of the Kasoli Housing Project to create way for the Standard Gauge Railway (SGR) has revealed that the latter disbursed compensation awards to 193 project affected persons.
Members of Parliament on the Committee of Physical Infrastructure are studying a petition by the Kasoli Tenants SACCO Limited, which was presented by Tororo Woman MP, Hon Sarah Opendi.
The project is a government low income housing project implemented by the Ministry of Lands, Housing and Urban Development between 2011 and 2016.
The project that aimed at providing low income slum dwellers with low cost housing, now faces demolition so as to enable works on the SGR to commence.
On Monday, 28 February 2022, lands ministry officials led by State Minister, Hon Persis Namuganza, presented additional information to the committee, on the project.
They include among others, details of a credit facility agreement between dfcu Bank on behalf of the Government and UN Habitat valued at US$ 500,000 in 2010, to fund the project through the bank’s monitoring and evaluation technical assistance.
Also among the documents is a letter by dfcu’s Senior Special Assets Manager Philipa Nanyondo, indicating that of the Shs1.075 billion advanced to the bank for purposes of mortgages in the Kasoli project, Shs952.4 million has been paid back to UN Habitat.
It adds that a principal exposure of Shs289.4 million remains outstanding, to be paid at a rate of two per cent.
“The US$ 500,000 fron UN Habitat was a loan to dfcu on the condition that it tops up with its own equivalent of the sum, and then it pays back to UN Habitat after the project,” said Dave Ayangayanga, Acting Director for Housing at the lands ministry.
“Finally, dfcu was able to pronounce itself on how much, because there was a lot of confusion on the outstanding amount,” added Namuganza.
Irene Gwokyalya, Acting Commissioner, Housing Development and Estates Management at the ministry told MPs that they engaged UN Habitat to shed more light on the funding, but await a response to date.
Among recommendations by the ministry was that the Government, as a priority, mobilises funds amounting to Shs3.186 billion to clear dfcu bank’s outstanding mortgage and prevent from proceeding with a foreclosure process.
The committee chairperson, Hon David Karubanga, urged the minister to set aside dfcu’s interests as fast as possible, so that SGR can complete the rest of the compensation process and take over the land.
“You should put it to the finance minister to secure the finances for dfcu in the next supplementary schedule. We need this issue sorted so that SGR can continue through the normal budgetary process to work with the sitting tenants,” said Karubanga.
The petitioner, Hon Sarah Opendi, commended the ministry for clearing the air on project affected persons compensated by SGR.
She added that officials from SGR had indicated that they had the money to pay compensations but did not know whom to pay.
“Let us pay off dfcu so that the land title can be retrieved and handed over to Standard Gauge Railway. dfcu has been patient with us since the time their advert in October for sale of land lapsed,” Opendi said.
Namuganza confirmed to the committee that SGR has the money for compensation but is still sifting through whom to compensate.
“It was very difficult to decide whom to pay because a lot of interest came in when people heard about the compensation by SGR,” she added.
In a committee sitting early this month, MPs opposed a Shs21.6 billion request from the Ministry to relocate the Kasoli housing project within Tororo district.
The minister, however, said on Monday that the Solicitor General recommended that the whole project be “considered as a project affected person and be continued elsewhere, but should not die.”
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