Uganda: Health Ministry directed to settle Shs31 billion debt to National Medical Stores (NMS)

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Parliament has directed the Ministry of Health to settle a debt of Shs31.4 billion owed to National Medical Stores (NMS).

This recommendation is contained in the report of the Committee on Commissions, Statutory Authorities and State Enterprises (COSASE) on the report of the Auditor General on the financial statements of NMS for financial year ended 30 June 2022.

Committee Chairperson, Hon. Joel Ssenyonyi who presented the report during on Wednesday, 05 July 2023 said that the Ministry of Health is the biggest debtor to NMS, followed by Centre for Disease Control (CDC) at Shs8.9 billion.
“The Ministry of Health owes money to National Medical Stores, and this affects the ability of NMS to execute its mandate. The accounting officer of the Ministry of Health in conjunction with the Ministry of Finance, Planning & Economic Development should settle all outstanding arrears to NMS within six months from the date of adoption of this report,” Ssenyonyi said.

The report indicated that according to NMS, efforts to have these funds recovered have been futile.

In addition, the report indicated that management reported a provision for doubtful debts to the tune of Shs25.8 billion.
“Included in this is Shs66 million in respect of Uganda AIDS Commission debts for handling fees, which according to management had become irrecoverable due to lack of contract documents,” the report reads in part.

Ssenyonyi said that the accounting officer submitted that the monies related to work done by NMS on behalf of the Ministry of Health, and that some related to relief items for Covid-19 and Ebola.
“Despite various reminders from NMS, the payments had not been made. The debts relating to the Uganda AIDS Commission were incurred back in 2006 and there was no documentation to support their claim,” he added.

The report further indicated that a representative of the Permanent Secretary of the Ministry of Health said that they had constituted a team of senior officers to undertake an examination of the figures and have them included in the statement to the Ministry of Finance.
“The accounting officer should ensure that all transactions of National Medical Stores are backed by proper documentation to avoid challenges while making claims for payment,” he said.

The Shadow Minister of Health, Hon. Timothy Batuwa said the Ministry of Health should be stopped from procuring medicines on behalf of NMS.
“If we do not stop Ministry of Health from procuring on behalf of NMS, we shall continue to face the same problem,” he said.

Kalungu West County Member of Parliament, Hon. Joseph Ssewungu wondered why the Ministry of Health does not pay NMS, despite budgetary allocations made to the health sector.
“We budget for funds and they must go to NMS. Why should Ministry of Health get money from Ministry of Finance and refuse to give NMS to procure drugs. This is painful and we must fight it,” Ssewungu said.

Hon. Faith Nakut (NRM, Napak District) called for intervention from the Inspectorate of Government (IGG) in the debt recovery.
“There must be connivance; somebody is hiding the documents to ensure that NMS does not get this money.  I propose that the IGG takes this up,” she said.

Distributed by APO Group on behalf of Parliament of the Republic of Uganda.