- The SACCO’s financials are not being managed in adherence to sound accounting principles and standards.
- All deductions that were or are being made in form of retirement benefits should be refunded with interest to the affected personnel.
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The Uganda Police Forces’ Exodus Savings and Credit Cooperative (SACCO) has been directed by parliament to stop mandatory deduction of personnel salaries as savings.
This is after the Committee on Defense and Internal Affairs discovered that the SACCO’s management is violating the Cooperatives Societies Act by denying them the option of voluntary saving. This was contained in the committee’s report on the inquiry into the operations of the Uganda Police Force Exodus SACCO that was presented by the chairperson, Hon. Wilson Kajwengye.
“The committee reiterates that the Registrar of Cooperatives Societies proceeds over the SACCO under Section 2 (2) of the Cooperatives Societies Act and immediately stops mandatory deductions on officers’ salaries and contributions for members’ savings until a comprehensive membership register is compiled on the condition that only willing members are registered,” says Kajwengye.
He adds that the stopped deductions should only apply to savings and not loans, stating that all members with outstanding loan obligations should continue to pay the SACCO.
Kajwengye says that the SACCO’s financials are not being managed in adherence to sound accounting principles and standards.
“It is the committee’s considered opinion that inconsistencies in data compilation is the major cause of discrepancies and unreliable financial positions which has significantly affected the members’ savings,” Kajwengye says.
The committee has also recommended that all deductions that were or are being made in form of retirement benefits should be refunded with interest to the affected personnel, saying that the deductions are contrary to the Pensions Act and urges parliament to direct the Office of Registrar of Cooperatives and Bank of Uganda to institute an independent forensic audit on the Exodus SACCO, as mandated by law.
The Minister of State for Internal Affairs, Gen. David Muhoozi, has justified the mandatory deductions, saying that it is aimed at improving the welfare of the officers, just like is the case with the Army’s SACCO.
“Granted, we had issues at the beginning of management, some of the issues still subsist but I want to urge members that rather than stampede a crash of this SACCO why shouldn’t we, may be, approach with caution and convince people to stay. I could see some sentiments - people saying, get your money and go,” said Muhoozi.
He has agreed with the recommendation to institute a procedure on access of benefits of deceased by their next of kin.
However, Deputy Speaker Thomas Tayebwa, has disagreed with the minister, saying that mandatory deductions of members’ salaries contravenes the law.