Audit exposes Shs 1.6bn scam at Uganda Airlines

What the report says

Uganda Airlines’ internal audit has flagged a procurement and contract-management scandal that it says cost the state-owned carrier Shs 1.6 billion in the 2024/2025 financial year. The Observer reports that the findings point to poor planning, weak needs assessment, budget overruns, payments made without purchase orders, and contracts issued without valid documentation.

The audit, authored by internal auditor Ronald Otukol, centers on a branding and communications procurement involving Metropolitan Republic Uganda Ltd and TBH Holding Ltd. According to the report, the airline’s bid process should have produced one best-evaluated bidder, but the work was split between two agencies. It says this deviated from the original terms of reference and contributed to spending that went beyond the approved budget. The report also says the airline has in-house staff who could have handled some of the work, raising questions about why third-party services were outsourced.

The Observer says the report recommends disciplinary action for several officials, including contracts committee chairperson and corporate affairs and PR manager Shakila Rahim Lamar, as well as chief finance officer Allan Kyeyune. It also says Lamar authorized payments without purchase orders and that some transactions continued after the TBH contract had expired. The newspaper reports that the audit found no proof of delivery for several services, which it says leaves the airline exposed to financial and operational risk.

If confirmed and acted on, the findings could sharpen scrutiny of procurement controls at Uganda Airlines and broader public-sector oversight in Uganda.