Suspended Uganda Airlines board gets golden handshake

Suspended board members of Uganda Airlines (UR, Entebbe/Kampala) have been offered golden handshakes to resign amid investigations into corruption and mismanagement under their tenure, local media report.

In a January 19 letter, company secretary Bisereko Kyomuhendo cited two meetings in October where shareholders had approved a departure package of UGX30 million shillings (USD8,581). In addition, each board member would receive monthly pay-outs for six months of UGX5 million (USD1,429), representing a UGX60 million (USD17,145) golden handshake each. The board members are chairman Pereza Ahabwe (a former Cabinet Minister from 2009 to 2011), Benon Kajuna (a director of transport at the Ministry of Works and Transport), Godfrey Ssemugooma, Catherine Asinde Poran, Charles Hamya, and Rehema Mutazindwa.

The termination of their contracts follows an investigation by State House and the Public Procurement and Disposal of Public Assets Authority (PPDA) – a public spending regulator – which has reportedly resulted in 14 charges of corruption, collusion, and mismanagement against the Board.

The board and top management of the airline, including former Chief Executive Officer Cornwell Muleya, were suspended in May 2021 over performance issues and delays in the start of the airline’s international operations.

This followed an Auditor-General’s report showing the airline had lost UGX15 billion (USD4.1 million) in the Financial Year 2018/2019 and UGX102 billion (USD28.5 million) in FY2019/20, with UGX168 million (USD45,815.42) in interest financing costs. It slammed the airline for incurring expenses that were way beyond the planned costs and its actual revenue. It further underlined that the airline’s business plan was not implemented in accordance with anticipated timelines.