Kampala, Uganda | Members of Parliament have accused the Ministry of Finance of fueling corruption and mismanagement after failing to remit funds meant to clear water bill arrears directly to the National Water and Sewerage Corporation (NWSC).
The concerns were raised during a sitting of Parliament’s Budget Committee, where legislators questioned the handling of a supplementary budget intended to settle outstanding water bills owed by government institutions.
Remigio Achia, the Vice Chairperson of the Budget Committee, said Parliament had approved UGX81 billion to clear water arrears, but instead of sending the money directly to NWSC, the Ministry of Finance channeled it through vote holders in Ministries, Departments and Agencies (MDAs). He said this practice created room for misuse.
Achia wondered how funds allocated for water payments could be redirected to other purposes, describing the practice as clear evidence of collusion. He said the committee must establish who authorized such changes and ensure accountability.
He further urged the Finance Committee to investigate the matter thoroughly and establish how public funds meant for utility payments were diverted.
Similarly, Remigio faulted the Ministry of Finance for entrusting MDAs with money meant for water bills, noting that many agencies instead spent the funds on other priorities, leaving NWSC unpaid.
Moses Aleper, the Vice Chairperson of the Finance Committee, assured members that the matter would be pursued with the Treasury. He said the committee would engage the Ministry of Finance to ensure the issue was fully addressed and made public.
Aleper pledged that Parliament would ensure transparency and accountability in the management of funds meant for utility payments.
Achia also asked Herbert Ariko, Chairperson of the Committee on Environment and Natural Resources, to escalate the matter to the Ministry of Finance. He questioned why the government continued to release money to agencies that repeatedly failed to settle their water bills.
He added that the issue should be prioritised during the budget process, especially the outstanding UGX69.4 billion owed to NWSC.
Presenting his committee’s report, Ariko revealed that although Parliament had recommended UGX81 billion to clear water arrears by June 2025, much of the money had not reached the intended agencies.
He further disclosed that between July and December 2025, new arrears had accumulated, raising fears that the debt could soon return to UGX80 billion or even higher.
Ariko called for stronger compliance mechanisms to ensure that funds released for water bills were actually remitted to NWSC.
He also informed the committee that NWSC had planned to raise about UGX600 billion from domestic banks to finance water infrastructure in various towns, each requiring between UGX19 billion and UGX20 billion.
However, he explained that the corporation’s ability to borrow had been weakened by outstanding government arrears amounting to UGX69.94 billion from 40 MDAs as of December 2025.
According to Ariko, the unpaid bills had damaged NWSC’s creditworthiness and limited its access to financing, undermining efforts to expand water infrastructure across the country.
As a result, he said, commercial banks had rejected NWSC’s borrowing plans due to concerns over the corporation’s financial stability.
The revelations were made as Ariko appeared before the Budget Committee to present the report on the 2026/27 National Budget Framework for the water utility.
Lawmakers warned that unless the government reforms the way utility payments are handled, NWSC will continue to struggle financially, slowing down water development projects nationwide.
