On the February 7, 2018, the Governor of the Bank of Uganda Prof Emmanuel Mutebile issued an internal memo via which he communicated a number of staff transfers and appointments. By way of the said memo he communicated a number of internal staff transfers as well as promotions. In the same memo, the Governor further communicated the appointment of five staff from outside the Bank to various positions in the Bank.
As a result of the Governor’s communication, complaints were made to the Inspectorate of Government and the Parliamentary Committee on Statutory Authorities and State Enterprises (COSASE). In the complaints it was alleged that the Governor acted in contravention of the laws and policies governing staff recruitment, promotions and transfers in the Bank.
The Governor was accused among others, appointing six new staff from outside the Bank without interviews, newly appointed staff were granted permanent and pensionable terms contrary to probationary policy, two new externally recruited staff, namely, Dr. Twinemanzi Tumubweine [Director of Supervision] and Ms. Kande Sabiiti lacked the minimum academic requirements for entering the bank, the Governor created five new positions that did not exist on approved structure of the Bank and that some appointees lacked job descriptions and one deputy director was demoted to Assistant Director without justification, namely, Ms. Angela Kasirye.
Following the complaints, on February 23, 2018, the Inspectorate of Government wrote to the Governor and requested that he responds to the allegations.
On the March 6, 2018, Mutebile responded to the allegations and wrote to explain that the appointment of new staff from outside the bank was done in accordance with the Bank of Uganda Act and internal recruitment policies of the bank. He further explained that the staff in question were recruited through headhunting subject to the headhunting policy of the Bank as approved by the Human Resource and Remuneration Committee of the Board of Directors on May 11,2016.
The Governor further explained that he had appointed new staff in accordance with Section 28(4) of the Bank of Uganda Act and also in line with authority granted to him by the Board of Directors on 30th May 2012. The Governor claimed that the authority granted by the Board permitted him to take decisions on behalf of the Board in the absence of a fully constituted Board whose term had expired on November 12, 2017.
Due to the increasing bad press coverage of the Bank of Uganda matter, President Yoweri Museveni deemed it necessary to establish a tripartite committee that would bring together the Parliament of Uganda, the Inspectorate of Government and Bank of Uganda, to study the allegations and report back to him in the shortest time possible.
The committee was established comprising of Abdu Katuntu (MP) – Chairperson; Anita Among (MP); Michael Tusiime (MP); Elijah Okupa (MP); Lady Justice Irene Mulygonja Kakooza (IGG); David Makumbi (IG Staff); Justus Kareebi (IG Staff); Sarah Birungi (IG Staff); Judy Obitre-Gama (BOU Board) and Keith Muhakanizi (BOU Board).
During the probe, the Committee established through interviews with senior staff of the bank that on February 7, 2018, the Governor communicated the promotion of 12 staff at the bank. Out of the 12 staff promoted, 9 were elevated from the rank of Senior Principal Banking Officer to the rank of Assistant Director. Two staff were elevated to the rank of Director and one staff was elevated to the position of Executive Director.
The Committee met the Governor on September 19, 2018 and requested him to explain the basis for his decision as communicated in his memo to staff on 7th February 2018. He explained that his actions were founded on a reorganization process which started in July 2017 when he requested the Executive Director Administration (EDA) for a staff transfer and rotation list. The Governor further pointed out that he had given a deadline of August 4, 2017 in the memo but received a response from the EDA on September 6, 2017. In that response he pointed out that the EDA had advised against transfer of Executive Directors to avoid misinterpretation on account of the issues related to eventual closure of Crane Bank.
“The Governor explained that the policy and practice in the Bank on promotion of officers of different ranks has always been through interviews, appraisals or direct promotional appointment by the Governor. He further explained that he had halted an earlier promotional process for Assistant Directors due to complaints from staff. He also explained that his decision was also based on an internal audit review of the process that staff had complained about. He explained that the promotion of the nine affected staff was through direct appointment by the Governor since the previous process had been mishandled. He further pointed out that he used the Succession Management Plan as a basis for making the appointments which needed to be done as quickly as possible to allow Bank operations to continue smoothly,” the committee stated in its report dated February 2019.
Mutebile mistakenly exercised authority;
According to the report, the committee says Governor Mutebile mistakenly exercised delegated authority of the Board to take a very broad far-reaching decision concerning the Bank and that the board resolution upon which he placed reliance to effect his decision be revoked to avoid any possibility of future confusion beyond what has already taken place.
“It is the view of the Committee that contrary to the Governor’s belief that the Board of Directors was not fully constituted so as to justify assumption of delegated responsibility, there was actually a Board of Directors in place. This is because Article 161(2) of the Constitution established the Board of Directors as consisting of the Governor and Deputy Governor as Chairperson and Deputy Chairperson respectively and not more than five other Directors.”
In its recommendations, the committee called for an urgent and comprehensive review of the legal regime governing the Bank of Uganda.
“A review therefore needs to be urgently undertaken and the Bank of Uganda laws brought into harmony with the Constitution along with any other matters necessary for the stability and smooth functioning of the central bank,” the committee suggested.
It also called for possible splitting or separation of the functions of the Governor and the Chairperson of the Board especially with regard to administrative matters as well as a review of Administration Manual to clarify ambiguities surrounding Entry Requirements and Job Descriptions.