Henry Musasizi, Uganda’s Finance MinisterThe government avoided taking on an additional UGX 270 billion in debt after the Auditor General’s assessment reduced the amount payable to electricity distributor Umeme Limited at the end of its 20-year concession.Parliament had in March 2025 authorized government to borrow up to $190.99 million, about UGX 711 billion, for the Umeme buyout.However, government eventually borrowed $118.39 million, about UGX 440 billion, leaving about $72.6 million (UGX 270 billion) unborrowed – representing a 38% saving on the approved ceiling.A report presented to Parliament by the Ministry of Finance shows that government only borrowed what was verified by the Auditor General, in line with Parliament’s conditions.“Only USD 118,385,603 recommended by the Auditor General as payout to Umeme Limited was borrowed by the Government, and paid to Umeme Limited within the conditions set out in the Parliamentary Resolution,” the report dated August 12, 2026 and signed by Finance Minister Henry Musasizi states.The report, seen by Uganda Radio Network, was submitted to Parliament on Tuesday. It outlines how the financing was mobilized after Parliament approved the borrowing on March 20, 2025.Parliament had directed that government should only pay an amount verified and recommended by the Auditor General before March 31, 2025, and that any unused balance should be cancelled and not form part of public debt.According to the Finance Ministry, the Auditor General’s final special audit report dated March 26, 2025 recommended a payout of $118.39 million.Government subsequently signed a financing agreement with Stanbic Bank Uganda Limited and Standard Bank of South Africa Limited, and on May 29, 2025 drew down €106.81 million, equivalent to the approved $118.39 million, into its euro holding account at Bank of Uganda.Risk Still RemainsWhile government contained its immediate borrowing, the lower payout does not end the financial dispute. Documents show Umeme reserved the right to pursue reconciliation of the final buyout amount, supplementary payments, damages and interest, potentially exposing government to further obligations depending on negotiations or dispute resolution.Under Article 159 of the Constitution, all government borrowing must be authorized by Parliament, with loan terms laid before the House. Article 160 defines public debt to include principal, interest and management costs.By borrowing only the amount recommended by the Auditor General, government prevented an extra UGX 270 billion from being added to the national debt stock.-URNThe post Gov’t Saves UGX270Bn After Audit Slashes Umeme Buyout Bill appeared first on Business Focus.