THE REPUBLIC OF UGANDA

REPORT OF THE AUDITOR GENERAL

ON THE FINANCIAL STATEMENTS OF THE MINISTRY OF GENDER,

LABOUR AND SOCIAL DEVELOPMENT FOR THE YEAR

ENDED 30TH JUNE, 2016

OFFICE OF THE AUDITOR GENERAL

UGANDA

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TABLE OF CONTENTS

PAGE

LIST OF ACRONYMS .......................................................................................................... i

REPORT OF THE AUDITOR GENERAL ........................................................................... 1

ON THE FINANCIAL STATEMENTS OF THE MINISTRY OF GENDER, LABOUR AND

SOCIAL DEVELOPMENT FOR THE YEAR ENDED 30TH JUNE 2016 ............................ 1

DETAILED REPORT OF THE AUDITOR GENERAL ON THE FINANCIAL

STATEMENTS .................................................................................................................... 4

1.0 INTRODUCTION ..................................................................................................... 4

2.0 BACKGROUND INFORMATION ............................................................................. 4

3.0 ENTITY FINANCING ............................................................................................... 5

4.0 OBJECTIVES OF THE MINISTRY .......................................................................... 5

5.0 AUDIT OBJECTIVES ............................................................................................... 6

6.0 PROCEDURES PERFORMED .................................................................................. 6

7.0 AUDIT FINDINGS ................................................................................................... 7

Funds not accounted for ....................................................................................... 8

8.0 Detailed Audit Findings ......................................................................................... 8

8.2 Youth Livelihood programme ............................................................................... 9

8.3 Payroll and Pensions Audit ................................................................................. 12

8.4 Funds not accounted for ..................................................................................... 13

8.5 Non-payment of Workman’s compensation within the stipulated time ....... 13

8.6 Staff management ............................................................................................... 14

8.7 Un-renewed workplace registration certificates .............................................. 16

8.8 Non-implementation of provisions under the Occupational Safety and

Health (OSH) Act 9, 2006 ................................................................................... 17

8.9 Review of implementation of Previous Year’s Recommendations ................ 17

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LIST OF ACRONYMS

ESP Expanded Social Protection Programme

ILO International Labour Organisation

MoFPED Ministry of Finance, Planning and Economic Development

MoUs Memoranda of Understanding

MOGLSD Ministry of Gender, Labour and social Development

NTR Non-Tax Revenue

OSH Occupational Safety and Health

PFMA Public Finance Management Act

PS/ST Permanent Secretary/Secretary to the Treasury

SDIP Social Development Investment Plan

SDS Social Development Sector

UGX Uganda Shillings

ULC Uganda Land Commission

UPDF Uganda Peoples Defence Force

USA Uganda Scouts Association

YLP Youth Livelihood Programme

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REPORT OF THE AUDITOR GENERAL

ON THE FINANCIAL STATEMENTS OF THE MINISTRY OF GENDER, LABOUR

AND SOCIAL DEVELOPMENT FOR THE YEAR ENDED 30TH JUNE, 2016

THE RT. HON. SPEAKER OF PARLIAMENT

I have audited the financial statements of the Ministry of Gender, Labour and Social

Development (MoGLSD) for the year ended 30th June, 2016. These financial statements

comprise of the Statement of Financial Position, the Statement of Financial Performance,

and Cash flow Statement together with other accompanying statements, notes and

accounting policies.

Management Responsibility for the Financial Statements

Under Article 164 of the Constitution of the Republic of Uganda, 1995 (as amended) and

Section 45 of the Public Finance Management Act (PFMA), 2015, the Accounting Officer

is accountable to Parliament for the funds and resources of the Ministry of Gender,

Labour and Social Development. The Accounting Officer is also responsible for the

preparation of financial statements in accordance with the requirements of the PFMA,

2015, and the Financial Reporting Guide, 2008, and for such internal control as

management determines is necessary to enable the preparation of financial statements

that are free from material misstatement whether due to fraud or error.

Auditor’s Responsibility

My responsibility as required by Article 163 of the Constitution of the Republic of

Uganda, 1995 (as amended) and Sections 13 and 19 of the National Audit Act, 2008 is

to express an opinion on the financial statements based on my audit. I conducted my

audit in accordance with the International Standards on Auditing. Those standards

require that I comply with ethical requirements and plan and perform the audit to obtain

reasonable assurance about whether the financial statements are free from material

misstatement.

An audit involves performing audit procedures to obtain audit evidence about the

amounts and disclosures in the financial statements as well as evidence supporting

compliance with relevant laws and regulations. The procedures selected depend on the

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Auditor’s judgment, including the assessment of risks of material misstatement of the

financial statements whether due to fraud or error. In making those risk assessments,

the Auditor considers internal controls relevant to the entity’s preparation and fair

presentation of financial statements in order to design audit procedures that are

appropriate in the circumstances, but not for purpose of expressing an opinion on the

effectiveness of the entity’s internal control. An audit also includes evaluating the

appropriateness of accounting policies used and the reasonableness of accounting

estimates made by management, as well as evaluating the overall presentation of the

financial statements.

I believe that the audit evidence I have obtained is sufficient and appropriate to provide

a basis for my opinion.

Part “A” of this report sets out my Opinion on the financial statements. Part “B” which

forms an integral part of this report presents in detail all the significant audit findings

made during the audit which have been brought to the attention of management.

PART "A"

Opinion

In my opinion, the financial statements of the Ministry of Gender, Labour and Social

Development present fairly in all material respects the financial position as at 30th June,

2016 and the financial performance and cash flows for the year then ended in

accordance with Section 51(1) of the PFMA, 2015 and the Financial Reporting Guide,

2008.

Emphasis of Matter

Without qualifying my opinion, I draw your attention to the following matter that is

disclosed in the financial statements under note 24;

Inadequate budget provision for Payables

Although the payables increased from UGX.3,726,312,583 in the previous financial

year 2014/15, to UGX.4,624,339,098, (2015/16) owing to the additions during the

year under review, the Ministry’s approved budget for Payables was only

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UGX.1,004,045,000 for 2016/17 which is not sufficient to cover all payments for the

outstanding payables.

Other Matters

In addition to the matter raised above, I consider it necessary to communicate the

following matters other than those presented or disclosed in the financial statements;

Lack of accounting Framework for Youth Livelihood Program Funds (YLP)

By June 2016, the YLP had been implemented for three years. However, the

program lacked a detailed accounting framework resulting into inconsistent

accountability for the funds by the implementing entities.

Recoverability of Youth Livelihood Program Funds

By the end of the financial year 2015/16, the disbursements to the youth groups had

accumulated to UGX.58,438,923,900 to 8,213, projects. However, audit noted that

only UGX.5,501,217,366 had been repaid out of the UGX.14.2 billion that was due for

repayment by the beneficiaries.

John F.S. Muwanga

AUDITOR GENERAL

15th December, 2016

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PART “B”

DETAILED REPORT OF THE AUDITOR GENERAL ON THE FINANCIAL STATEMENTS

OF THE MINISTRY OF GENDER, LABOUR AND SOCIAL DEVELOPMENT FOR THE

FINANCIAL YEAR ENDED 30TH JUNE 2016

This section outlines the detailed audit findings, management responses, if any, and

recommendations in respect thereof.

1.0 INTRODUCTION

Article 163(3) of the Constitution of the Republic of Uganda, 1995 (as amended)

requires me to audit and report on the public accounts of Uganda and all public

offices including the courts, the central and local government administrations,

universities, and public institutions of the like nature and any public corporation or

other bodies or organizations established by an Act of Parliament. Accordingly, I

carried out the audit of the Ministry to enable me report to Parliament.

2.0 BACKGROUND INFORMATION

The Ministry of Gender Labour and Social Development commonly called the

Ministry of Gender is a Government Ministry with the responsibility of promotion of

employment and productivity, positive cultural values, rights of vulnerable groups

and gender responsive development. The Ministry has one of its major tasks as to

ensure that all Ugandans enjoy better standards of living, especially the

disadvantaged and vulnerable groups.

The Ministry came into being by a constitutional requirement of the 1995

Constitution, Chapters 4 and 16 which mandates government to: “empower

communities to harness their potential through skills development, Labour

productivity and cultural growth.” The constitution advocates for protection and

promotion of fundamental rights of the poor and other vulnerable groups as well as

institutions of traditional or cultural leaders.

The Ministry is comprised of the Social Development Sector (SDS) that promotes

issues of social protection, gender equality, equity, human rights, culture, decent

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work conditions and empowerment for different groups such as women, children,

the unemployed youth, internally displaced persons, the older persons and persons

with disabilities. The Ministry is the lead agency for this sector and is charged with

the development and implementation of the Social Development Investment Plan

(SDIP) with the mandate to empower communities to harness their potential

through cultural growth, skills development and Labour productivity for sustainable

and gender responsive development.

The Ministry’s Vision is to ensure a better standard of living, equity and social

cohesion while its Mission is Promotion of gender equality, social protection and

transformation of communities.

The Ministry is located at Plot 2, Simbamanyo House, George Street, Kampala.

3.0 ENTITY FINANCING

The Ministry of Gender Labour and Social development was financed by Grants from

Central Government to the tune of UGX.62,898,710,946 and generated Non-Tax

Revenue (NTR) of 1,178,187,000.

4.0 OBJECTIVES OF THE MINISTRY

The objectives of the Ministry are to:-

Empower communities to appreciate access, participate in, manage and

demand accountability in public and community based initiatives.

Protect vulnerable persons from deprivation and livelihood risks.

Create an enabling environment for increasing employment opportunities and

productivity for improved livelihoods and social security for all, especially the

poor and vulnerable.

Ensure that issues of inequality and exclusion in access to services across all

sectors and at all levels are addressed; and

Improve performance of Social Development Institutions to coordinate and

implement the Social Development Investment Plan (SDIP) at various levels.

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5.0 AUDIT OBJECTIVES

The audit was carried out in accordance with International Standards on Auditing

and accordingly included a review of the accounting records and agreed procedures

as was considered necessary. In conducting my reviews, special attention was paid

to establish:-

1) Whether the financial statements have been prepared in accordance with

consistently applied accounting Policies and fairly present the revenues and

expenditures for the period and of the financial position as at the end of the

period.

2) Whether all funds were utilized with due attention to economy and efficiency

and only for the purposes for which the funds were provided.

3) Whether goods and services financed have been procured in accordance with

the Government of Uganda Procurement regulations.

4) Whether management put in place sufficient internal controls and the internal

controls operated as intended throughout the year.

5) Whether the management was in compliance with the Government of Uganda

financial regulations.

6) Whether all necessary supporting documents, records and accounts have been

kept in respect of all activities, and are in agreement with the financial

statements presented.

6.0 PROCEDURES PERFORMED

The following audit procedures were undertaken:-

a. Revenue

Obtained schedules of all revenues collected and reconciled the amounts to

the cashbooks and bank statements.

b. Expenditure

The payment vouchers were examined for proper authorization, eligibility and

budgetary provision, accountability and support documentation.

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c. Internal Control system

Reviewed the internal control system and its operations to establish whether

sound controls were applied throughout the period audited.

d. Procurement

Reviewed the procurement of goods and services by the Ministry during the

period under review and reconciled with the approved procurement plan.

e. Fixed Assets Management

Reviewed the use and management of the Ministry’s assets during the period

audited.

f. Financial Statements

Examined on a test basis, evidence supporting the amounts and disclosures

in the financial statements; assessed the accounting principles used and

significant estimates made by management; as well as evaluating the overall

financial statement presentation.

7.0 AUDIT FINDINGS

7.1. Categorization of Findings

The following system of profiling of the audit findings has been adopted to better

prioritise the implementation of audit recommendations:-

o Category Description 1 High Significance Has a significant / material impact, has a high likelihood

of reoccurrence, and in the opinion of the Auditor General, it requires urgent remedial action. It is a matter of high risk or high stakeholder interest.

2 Moderate Significance Has a moderate impact, has a likelihood of reoccurrence, and in the opinion of the Auditor General, it requires remedial action. It is a matter of medium risk or moderate stakeholder interest.

3 Low Significance Has a low impact, has a remote likelihood of reoccurrence, and in the opinion of the Auditor General, may not require much attention, though its remediation may add value to the entity. It is a matter of low risk or low stakeholder interest.

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7.2 Summary of Findings

No Title of Finding Significance

8.1 Inadequate budget provisions for payables High

8.2 Youth Livelihood Programme High

8.3.1 Missing pension files High

8.4 Funds not accounted for Moderate

8.5 Non-payment of Workman’s compensation within the stipulated

time

Moderate

8.6 Staff Management Moderate

8.7 Un-renewed workplace registration certificates Moderate

8.8 Non-implementation of provisions under the OSH Act 9, 2006

8.9 Review of implementation of previous year’s recommendations

8.0 Detailed Audit Findings

8.1 Inadequate budget provision for Payables

The payables increased from UGX.3,726,312,583 in the previous financial year

2014/15 to UGX.4,624,339,098, in 2015/16 owing to the additions during the year

under review. However, the Ministry’s approved budget for domestic arrears

was only UGX.1,004,045,000 for 2016/17which is not sufficient to cover payments

for all domestic arrears for the previous years. Following the PS/ST’s directive vide

circular referenced BPD 86/298/02 dated 10th June, 2016 requiring all accounting

Officers to prioritise payment of domestic arrears in the 1st Quarter of 2016/17,

settlement of huge domestic arrears balances will affect implementation of

activities planned for 2016/17.

The Accounting Officer explained that MoGLSD endeavoured to forecast budgetary

expectations but was constrained by the inconsistencies in quarterly budget

releases, which were not commensurate to the competing actual demands coupled

with the ceiling that was insufficient to cover the entire mandatory and priority

expenditure in a given financial year.

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He added that the bulk of the domestic arrears were composed of Workman’s

compensation of which the Ministry of Finance, Planning and Economic

Development (MoFPED) had approved one (1) billion per annum over the last two

(2) Financial Years - to reduce the obligation.

I advised the Accounting Officer to liaise with the MoFPED and ensure that enough

funds are budgeted for to settle the outstanding liabilities.

8.2 Youth Livelihood programme

8.2.1 Lack of accounting framework

By 30th June 2016, the Youth Livelihood Programme (YLP) had been implemented

for three years. However, there was no proper accounting framework and/or

detailed guidelines for accountability. Consequently the implementing entities under

the programme accounted for funds differently, which is not only recipe for

improper accounting for programme funds but also impedes comparability of

accounting reports across the implementing entities.

Although the Permanent Secretary/Secretary to the Treasury (PS/ST) in letter dated

5th May 2016 had requested the PS - MoGLSD to work with the Accountant General

to develop detailed guidelines, by the time of audit, no guidelines had been

developed.

The Accounting Officer in response stated that some actions had been undertaken,

including developing simplified guidelines/formats which were shared with the

Accountant General for use by the YLP beneficiary groups at the community level. In

addition, the Accountant General had constituted a Technical Working Committee

for formulation of Accounting and Reporting Guidelines for all Government of

Uganda Revolving Funds and the MoGLSD nominated members to the committee

that was expected to work under the leadership of the Accountant General.

I advised the Accounting Officer to continue the engagement with the Accountant

General so as to expedite the process of developing guidelines to streamline the

programme’s accounting processes.

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8.2.2 Recoverability of program funds

Phase I of the YLP programme started in the financial year 2013/2014 with a total

accumulated disbursement of UGX.58,438,923,900 to 8,213 projects by end of

2015/16 financial year. A review of the overall status of the program revealed the

following;

(i) Low rate of recovery

The overall repayment as at 28th October, 2016 stood at UGX.5,501,217,366 (39%)

of the UGX 14.2 billion that was due for repayment by the beneficiaries.

(ii) Non traceable group projects

During inspection, audit also noted that some projects/business managed by some

of the youth groups could not be traced on the ground. This was because some of

the projects were either non-existent, had been disbanded or members had

formed different projects thus presenting challenges of enforcing recoverability.

Consequently UGX.527,308,994 which had been released to these specific groups

may not be recoverable.

(iii) Non compliance with recovery schedules

In addition non-compliance with recovery schedules was noted in the districts of

Kanungu, Gulu and Koboko. A comparison of disbursement date, with first date of

recovery and due date to completion recovery showed that some projects in the

three districts had not paid instalments totalling UGX.290,873,435, as per the

agreed terms.

(iv) Lack of repayment/recovery schedule

In the districts of Isingiro, Ntungamo, Kisoro and Kabarole no copies of

repayment/recovery schedules were availed. It was not clear how funds were to be

recovered from the beneficiary groups. Consequently audit could not determine

the amounts due for recovery and how much had actually been recovered in the

four districts.

The above gaps in the implementation of the program are likely to affect

achievement of the program’s intended objectives.

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The Accounting Officer explained that there was evidence of improved recovery

from the youth groups and that on average, the Ministry was recovering over

UGX.100 million per week.

He also stated the Ministry had taken measures to sensitize the beneficiaries and

the general public on the Programme and mobilize the beneficiaries for

repayment through stakeholder engagements in various fora

I advised the Accounting Officer to;

Hasten recover of funds from the youth groups as per the agreed terms and

schedules with a view of ensuring sustainability of the revolving fund and

thus the attainment of programme objectives.

Consider partnering other government institutions such as MTAC that are

mandated to incubate businesses and train stakeholders.

Improve on monitoring and supervision and where possible invoke sanctions

on youth groups that are defaulting on repayment.

8.2.3 Lack of memoranda of understanding/financing agreements

Paragraph 4.1(iii) of the programme guidelines requires MoGLSD to sign

Memoranda of Understanding (MoUs) with implementing District Local

Governments (DLGs). In the same vein the districts are required to sign financing

agreements with youth groups that have been approved for funding.

It was however noted that in Ntungamo and Isingiro Districts, some projects which

had received funding of UGX.673,689,519, never signed financing agreements,

contrary to the MOU requirements. Consequently there was a challenge of

enforceability of responsibilities and obligations. This has a bearing on both the

youths’ commitment to their projects and the funds recoverability.

In response, the Accounting Officer explained that he had taken up the matter

with the Accounting Officers of the two Districts, given that the training of groups

and the signing of financing agreements between the local governments and the

beneficiary groups were pre-conditions for disbursement of funds by the District to

the individual youth groups’ accounts.

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I await the outcome of management’s actions on the Accounting Officers of the

two Districts. I also advised him to extend the same to all other districts as similar

challenges may be pertaining there.

8.2.4 Non-compliance with youth interest group composition requirements

It was noted that some youth groups had less than 30% female members, which is

a requirement in paragraph 4.2 of the YLP document, 2013. This was attributed to

inadequate guidance by the technical committees and this may disadvantage the

female youths in as far as development is concerned.

The Accounting Officer explained that overall, 45% of the 107,970 beneficiaries of

YLP were female, surpassing the minimum requirement of 30%, however arising

from errors of omission, a few projects 98 (1.2%) had fallen short of having at least

30% female members.

Management undertook to pay more attention at the review stage to ensure that

gender composition requirements are adhered to at the individual projects level.

I advised the Accounting Officer to ensure that all youth groups comply with the

gender composition requirement, before funding is accessed.

8.3 Payroll and Pensions Audit

8.3.1 Missing pensioner files

A sample of 15 pensioners out of 170 with payments totalling UGX.167,092,542

were randomly selected for verification tests and it was noted that only two had

personal files with original documents while the rest had uncertified photocopies of

documents such as appointment letters, confirmation and computation forms. This

was contrary to paragraph P-d (5) of the Standing Orders, 2010 that requires a

public officer’s personal records to be complete and up to date at any given time,

opened and maintained at the Ministry of Public Service and the Ministry

Department or Local Government where the officer is working.

Audit could neither confirm the authenticity of pension payments effected on

photocopied documents nor rule out payment of non-existing pensioners.

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Management in its response explained that the Ministry was an amalgamation of

previously different ministries, which had metamorphosed overtime, consequently

leading to transit of documents including personal files. By the time of

decentralisation of salaries and pensions, most of the pensioners were already on

the payment system, thus any lapse in payment of emoluments would lead to

anxiety. As a stop gap measure the Ministry had to utilise photocopies of the

relevant documents.

I advised the Accounting Officer to liaise with the Ministry of Public Service to access

certified copies of documents for each pensioner.

8.4 Funds not accounted for

The MoGLSD and the Uganda Scouts Association (USA) hosted the International

Scouts Centenary Jamboree from 18th-28th August 2015 at Kaazi National Campsite,

which brought together 163 member countries. The preparatory activities included

mobilization, coordination & monitoring, installation of a dedicated website,

construction of Kaazi Camping Site, welfare activities, printing medals and

certificates, security and entertainment.

It was noted that payments totalling UGX.54,672,250 for various activities lacked

the requisite accountabilities, contrary to the requirement to have all vouchers

accompanied by supporting documents.

In the absence of the requisite accountability documentation, audit could not

confirm whether the funds were utilized for the intended Jamboree activities.

The Accounting officer indicated that all the accountability was available however on

examination the stated amount remained outstanding.

I advised the Accounting Officer to ensure funds are accounted for or recovered

accordingly.

8.5 Non-payment of Workman’s compensation within the stipulated time

In the year under review, the Ministry had compensation claims totalling to

UGX.536,834,749, which was an addition to the outstanding balance of

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UGX.3,162,461,669 reported in the financial year 2014/15, resulting in a total figure

of UGX.3,699,296,414. Of this amount, only UGX.654,019,838 was settled leaving a

balance of UGX.3,045,276,580.

Long outstanding compensation claims implies that the beneficiary persons were

denied their compensation and this, if not timely handled may result into litigations

and their attendant costs.

Management attributed the non-payment of outstanding claims to inadequate

funding, and added that MoFPED was supporting the Ministry to clear the claims by

providing UGX 1 billion effective FY 2014/15. MoFPED had also made a proposal that

new claims should be budgeted for and handled by responsible institutions where

the accidents occured, which MoGLSD was agreeable to.

I await the outcome of management’s actions undertaken in collaboration with other

government departments in ensuring the settlement of the outstanding claims.

8.6 Staff management

8.6.1 Un implemented provisions in the National Employment Policy

The ministry developed a National Employment Policy for Uganda, April 2011 to

guide all stakeholders on creation and enhancement of the quality and availability of

gainful employment opportunities. A review of the Policy however revealed;

(i) Failure to review the National employment Policy

Paragraph 10 of the National Employment Policy for Uganda, April 2011 provides

for its review after every five (5) years to take into account, the impact,

performance and emerging challenges. However, by the time of audit, the five

year period of the policy had elapsed and yet there was no evidence of the

review. In the circumstances emerging developments especially regarding

externalization of labour may not be adequately catered for. In response, the

Accounting officer explained that arrangements were being made to review the

policy through consultancy.

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(ii) Lack of employment register and computerised employment permits

The Ministry was supposed to issue computerised employment permits in order

to keep track of persons eligible for employment in the country and to maintain

an employment register, in fulfilment of paragraph 7.2 that states that one of

the strategies on labour market information was the strengthening of the

ministry responsible for labour to play its role as the national and regional

depository for labour and employment management information.

I noted that computerised employment permits have not been issued which

makes it impractical for the ministry to account for the work force - both foreign

immigrants and citizens. This hinders proper planning for the workforce.

In response, the Accounting explained that the development of labour market

information and analysis system was on-going and once finalised it would take

care of the registers and permits.

(iii) Lack of Labour Officers at the districts

Paragraph 3.7 of the National Employment Policy, 2011 provide for the

decentralisation of key aspects of labour administration in accordance with the

decentralisation policy by recruiting labour officers at districts to carry out

inspection of workplaces, investigate contract breaches and arbitrate cases of

undesirable working conditions between the workers and employers besides

providing the relevant technical advice.

By the time of audit, only 45 out of the 112 districts had recruited labour

officers. Consequently, the rights of employees may not be protected as far as

working conditions, engagement and disengagement are concerned.

Management attributed the scenario to inadequate funding at the districts.

In response the Accounting Officer explained that the MoGLSD continued to

lliase withLocal Governments, Ministry of Public Service, MoFPED and the

Ministry of Local Government on the essential role of Labour officers at the

district level.

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(iv) Lack of a revolving fund

In the recent past, the labour markets abroad have increasingly continued to

provide employment opportunities for Ugandans. Paragraph 7.8 of the National

Employment Policy for Uganda, April 2011, (under externalisation of labour),

provides for a strategy of establishing a revolving fund to facilitate Ugandans

seeking employment abroad.

However audit noted that the Ministry had not established the required

revolving fund. The Accounting Officer explained that the Revolving Fund as

envisaged by the National Employment Policy shall be taken care of under one

of the components of Promotion of green Jobs and fair Labour Markets .

I advised the Accounting Officer to ensure that;

The National Employment Policy is reviewed to reflect the emerging labour

conditions and challenges, so as to remain relevant to the labour force.

An employment register and computerised employment permits are put in

place to enable proper planning for the workforce.

Relevant stakeholders are engaged to ensure that labour officers are

recruited in all the districts to undertake the envisaged roles more effectively

in the districts.

The revolving fund is actualised, as had been envisaged by the National

Employment Policy.

8.7 Un-renewed workplace registration certificates

Analysis of Register for the registered workplaces revealed that 60 of themhad not

renewed their certificates, contrary to Section 41(3) of the Occupational Safety and

Health (OSH) Act 9, 2006 which requires all work places to possess certificates of

registration that are renewed every three years. This not only contravenes the legal

requirement but also deprives the Ministry of Non-tax revenue.

Management attributed this to inadequate personnel (numbers and skills) and

logistics which hampers enforcement. While International Labour Organisation (ILO)

standard requires inspector to worker ratio of 1:500, Uganda stood at 1:389,286 In

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addition OSH services were never decentralised, but the Ministry had 26 staff to

cover all registration and inspection of over 500,000 workplaces in the country.

I advised the Accounting Officer to enforce compliance with the above provision and

put in place an appropriate mechanism to ensure that the renewals are effected.

The Ministry should consider automation of the process to address the limitation of

manpower.

8.8 Non-implementation of provisions under the Occupational Safety and

Health (OSH) Act 9, 2006

8.8.1 Lack of a Policy and board for Occupational Safety and Health

Review of the strategic plan 2011/12-2015/16 revealed that despite having the OSH

Act, the Ministry lacked a National Policy for Occupational Safety and Health. This

implies that there are no clear procedures and systems to follow in taking decisions

to achieve the intended objectives of Occupational Safety and Health law.

Additionally, whereas Section 10 of the OSH Act 9, 2006 requires establishment of a

board appointed by the Minister, I noted that the Minister had never constituted the

board. Absence of the board potentially leads to supervision challenges and lack of

strategic direction regarding occupational safety and health activities and the

implementation of the Act itself.

In response, the Accounting Officer explained that the development of the policy on

OSH was on-going and is expected to be approved by 31st December 2016.

Subsequently, the board shall be established.

I advised the Accounting Officer to hasten the process of having the policy approved

so as to guide the operationalization of the Act.

8.9 Review of implementation of Previous Year’s Recommendations

A review of the implementation of the previous year’s audit recommendations

revealed status of implementation, as shown in the following table;

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No Observation Status of

Implementation

Management Response

1 Payables Partially

Addressed

Arrears are being settled as when

funding is received. Most of the

payables are due to Workman’s

compensation

2 Under-staffing Partially

addressed

Some positions have been filled

3 Accumulation of

labour disputes at the

Industrial Court

Not Addressed Ministry engaging Ministry of Public

Service and the Public Service

Commission to handle staffing gaps at

the Industrial Court

4 Status of reception

Centre, and remand

Homes

Partially

Addressed

Funding received and more expected

from MoFPED to improve all

institutions under the ministry

5 Payroll management

weaknesses

Partially

Addressed

Funds overpaid have been recovered

by underpaying pensions for the

concerned staff

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Inadequate

monitoring of Youth

Interest Groups

(YIGs) projects under

the YLP.

Partially

Addressed

Monitoring has improved.

7 Non-recovery of

revolving funds

Partially

Addressed

More funds recovered.

8 Potential Loss of

funds

Not Addressed Funds not recovered.

I advised management to implement all the pending recommendations pointed out

in the previous audit report to enhance sound stewardship.