By Nasser Kasozi Akandwanaho
A number of state-owned enterprises and corporations in Uganda are grappling with worsening financial performance, according to the latest Auditor General’s report for the year ending December 2024.
Several key agencies, including Kilembe Mines Limited, Uganda Electricity Distribution Company Limited (UEDCL), Uganda Railways Corporation (URC), and NEC Farm Katonga Limited, have reported significant losses compared to the previous financial year.
NEC Farm Katonga Limited saw its losses surge from Shs70 million in the 2022/23 financial year to a staggering Shs 1.9 billion in 2023/24.
Kilembe Mines Limited’s losses ballooned from Shs2.39 billion to Shs21.35 billion, while UEDCL’s losses rose from Shs2.18 billion to Shs10.92 billion.
Uganda Railways Corporation, which has faced challenges for years, saw its losses climb slightly from Shs35.6 billion to Shs36.34 billion.
These figures are raising concerns about inefficiency, poor management, and an inability to adapt to changing economic conditions.
With these agencies often funded by taxpayer money, the mounting deficits are putting a growing strain on the public purse and raising questions about governance and oversight within these organizations.
However, not all state corporations have been facing bleak financial outcomes. Both Uganda National Oil Company (UNOC) and Uganda Airlines, although still operating at a loss, have made notable strides in reducing their deficits.
Uganda Airlines managed to decrease its losses by 26.5%, from Shs324.9 billion in 2023 to Shs237.85 billion in 2024, reflecting improved revenue generation and cost management.
UNOC’s losses saw a sharp reduction of 78.4%, dropping from Shs17.5 billion to Shs3.78 billion. This highlights the potential for improvement within state enterprises when managed effectively.
Uganda Air Cargo Corporation also showed progress, reducing its losses from Shs10 billion in 2023 to Shs8.21 billion in 2024.
While these figures still represent substantial losses, the trend is encouraging, suggesting that operational adjustments and better financial oversight can result in significant improvements.
On a more positive note, the Auditor General’s report highlighted several public corporations that posted profits in the 2023/24 financial year.
Of the 50 public corporations and state enterprises, 41 are either for-profit or have a commercial orientation, while nine are not-for-profit.
Among the most successful entities were Uganda Electricity Transmission Company Limited (UETCL), Uganda Electricity Generation Company Limited (UEGCL), and Uganda Civil Aviation Authority (UCAA), which reported impressive profits.
UETCL earned Shs82.25 billion, UEGCL earned Shs54.28 billion, and UCAA posted Shs32 billion in profits, demonstrating strong financial management and commercial viability.
The Mandela National Stadium also reported Shs18.66 billion in profits, while various National Enterprise Corporation (NEC) subsidiaries performed well.
NEC Luwero Industries Limited earned Shs10.65 billion, NEC Construction Works and Engineering Limited reported Shs5.46 billion, and NEC AGRO SMC Limited earned Shs4.34 billion.
These figures show that with the right strategies, public corporations across different sectors can turn a profit.
However, the report also raised concerns about National Housing and Construction Company Limited (NHCC), which saw its profits plummet by 90.5%, from Shs34.59 billion the previous year to just Shs3.27 billion.
This sharp decline raises doubts about the future viability of NHCC, especially given its role in Uganda’s housing and infrastructure development.
Meanwhile, Uganda Printing and Publishing Corporation (UPPC), which had previously posted a loss of Shs3.07 billion, managed to turn around its financial situation with a modest profit of Shs1.04 billion for the 2023/24 financial year.
The findings from the Auditor General’s report raise important questions about the governance, management, and efficiency of state-owned enterprises in Uganda.
With several agencies continuing to report heavy losses, there is increasing concern about the lack of effective oversight and accountability within these organizations.
The government, which allocates public funds to these entities, must ensure that management teams are held accountable for their financial performance.
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