By John V Sserwaniko
The Finance Ministry (which directly supervises URA) has spoken out confirming our earlier story that the Dorris Akol-led tax body will effective next Financial Year (starting July 2019) be the one directly collecting all tuition fees and other forms of NTR on behalf of all Public Universities.
Responding to questions from Mulengera news, Deputy PS/Secretary to Treasury Patrick Ochailap (who is also the Ag PSST as Keith Muhakanizi gets treatment in Turkey) said the decision would benefit Universities more than URA or even the Finance Ministry itself. Generally speaking, the mandate to collect all government revenue lies with the Finance Ministry which had delegated the duty to the Public Universities to do it on their behalf (just like Local Governments had been delegated).
All this is categorized as Non Tax Revenue (NTR) which, once collected, must ordinarily be passed on to the Consolidated Fund. Ochailap now says with URA’s efficiency and record of excellence when it comes to collecting government revenues, the Finance Ministry is optimistic that Makerere and other Public Universities are going to begin to collect and realize much more revenue than has been happening.
“The problem of Makerere being in perennial revenue deficit and having to be bailed out with top ups by the central government is going to become history. This is so because poor revenue collection, sometimes resulting from corruption, fraud and inefficiency is going to become a thing of the past and this is good for those very institutions. They will become self-reliant through revenue collected from their own tuition and you won’t have powerful individuals defrauding the University anymore,” Ochailap explained adding that the prospect of much more revenue being realized explains why University VCs and Accounting Officers have since welcomed the URA intervention as refreshing and long overdue.
“It’s the best decision we could make because URA represents the very best practice and highest levels of performance in matters regarding government revenue collection. This is the case because they have the most appropriate technological and human resources for such tasks. They have built experience and the expertise over a long time and we are hopeful the problem of Universities having revenue shortfalls and running to finance every now and then is going to be overcome pretty soon.”
Ochailap said the coming on board of URA means Universities now have the opportunity to more meaningfully concentrate on their core mandate which is research and training. This concentration, he said, will benefit students because it will enhance service delivery as resources are saved and concentrated on executing the core mandate.
He said as the supervising ministry, they are proud of the fact URA has over the years made sufficient investments and in the process accumulating the necessary human and technological capabilities. He added over the years many useful lessons and experiences too have been learnt making URA revenue collection IT systems not only extremely transparent (and verifiable) and also the robust.
He added that unlike the Makerere & other Public Universities’ revenue collection systems, the URA one permits frequent timely verification by multiple stakeholders which is a good intervention when it comes to diminishing the possibilities of fraud being committed.
He said gratefully, there is no extra cost that paying students are going to incur as the concerned commercial banks change from being Makerere to becoming URA collection agents.
URA is taking over not only collection of Public Universities’ tuition fees but also the role of collecting revenues from tourists coming to Uganda for recreation in all National Game Parks managed by UWA. Ochailap says the other comforting fact is that taking on this additional responsibility won’t necessitate URA scaling up its operational costs in any very significant way.
Asked about the possibility of Akol-led URA being asked subsequently to take over the duty of collecting school fees for even primary and secondary schools that are government-owned, Ochailap said “whereas it’s not something we have given any serious thought so far, it’s a possibility” that can be considered and the most appropriate decision eventually taken.
OUR EARLIER STORY
Under the headline “M7 Gives Akol More Powers,” the following is how Mulengera news, reported about URA’s intervention into tuition fees collection:
VERBATTIM:
If you thought the end of Commissioner General Dorris Akol’s days at URA were near, just read this.
President Museveni, who is said to be happy with her these days having appreciated the difficulties in targeted revenue collection, has lately decreed that Akol-led URA immediately takes over the collection of government revenue including tuition from University students.
In what treasury sources say is meant to minimize fraud, increase transparency and streamline revenue collection, URA will now be collecting even what entities like KCCA and Public Universities have been collecting.
Sources say subsequently even the collection of school fees in government-owned secondary schools will soon be collected by URA, leaving head teachers powerless and more weakened. URA will also handle all the Uganda Wildlife Authority (UWA) collections effective July 2019.
Just recently, the President (who these days doesn’t like technocrats dragging their feet on directives) prompted Finance Minister Matia Kasaijja and PSST Keith Muhakanizi to convene an urgent meeting at the Finance Ministry board room.
In attendance were all the Vice Chancellors, their respective accounting officers (called University Secretaries) and a powerful delegation from URA. While there Kasaija and Muhakanizi shocked the University officials (who between them control more than Shs1trillion) when they told them there would be no more collecting of any money (NTRs e.g. tuition fees) at their Universities.
They told them government had decided to have URA collect and control all the Non-Tax Revenues (NTRs) for all government entities and the motive was to eliminate fraud and also enable government to establish the accurate figures regarding how much is annually collected.
They were told this was extending even to KCCA and other entities that have been involved in any form of collection of revenue on behalf of government. The Auditor General John Muwanga in his past reports has been very critical of several MDAs for collecting and not remitting NTRs to the consolidated fund.
Public Universities and KCCA had for long been spared that criticism by the AG as they were free to collect tuition fees and use it as per their approved work plans for a given financial year. This had made the VCs and USs powerful and carry massive clout that naturally comes with having direct control over the collection of so much money-it’s actually in billions per University.
During the Finance Ministry meeting, the VCs and their USs tried to put up resistance but Muhakanizi (who seemed well prepared) answered all the questions before Kasaijja finally dismissed the meeting. They were told Finance will as usual avail cash to finance all their planned activities (using both their collections and govt contribution) but Akol-led URA would 100% handle the collection using commercial banks.
She will be controlling the reception and handling of even money coming in form of projects for all the Public Universities. So what now will happen is that commercial banks will continue collecting tuition like before but the students will be paying onto the URA collection account and not that of the University any more. URA will then transfer the money to the treasury account within 24 hours. Then a given accounting officer will electronically go through the finance ministry to access and spend that collected tuition money on the activities planned and approved for that FY.
“Your money will still be available to you as and when you want it but the power to collect is now with URA. It’s us the treasury who had given you that mandate to collect the money on our behalf and we are the same people now transferring that responsibility to URA. Where is the problem? Your money will still be available to you but the power to collect won’t be with you anymore because URA is more suited,” Muhakanizi told the University bosses who immediately abandoned their objections on realizing this was something the top political leadership of Uganda had endorsed.
They were also directed to immediately write to commercial banks announcing closure of all expenditure and operations accounts the Universities have been operating there. And sources say Stanbic bank (inheriting from former UCB) was affected most on this because it has been having a lion’s share on such University accounts. All the commercial banks will only remain with one University account and that’s collection account strictly.
But even then the account names will all change from the respective Universities to now be for URA meaning the banks will be collecting agents for URA and not the respective Universities anymore. Finance Ministry sources say that so eloquent was Muhakanizi in justifying the new policy (taking effect from July 2019) that at the end of his submission, the clearly crest-fallen University bosses just walked out of the Ministry to each return to their respective campuses.
This is similar to what Muhakanizi occasioned years earlier against district local governments and their CAOs. This partly contributed to the collapse of Crane Bank whose proprietor Sudhir Rupalleria had good rapport with these local governments and most of their expenditure/operations accounts were held there until the same was consolidated onto the single treasury account which will remain part of PSST Keith Muhakanizi’s lasting legacy.
Muhakanizi told the VCs he would release all the money required to them as per the approved work plans even if they have collected zero tuition in that quarter and he can recover the money in the subsequent quarter after tuition has been paid. URA says they are more than ready to carry on this new task that will also help boost their efforts to collect their set revenue targets for a given FY. For comments, call, text or whatsapp us on 0703164755.
