Schools given a year to pay debts to UMEME

This figure was revealed in Umeme’s end of year performance report. 

The Managing Director Umeme Limited, Mr. Selestino Babungi, has ominously warned that education institutions, which are just getting back on their feet after a two-year lockdown, will have until the end of 2022 to clear these arrears.

“We shall give them a whole 2022. As they open up, we expect them to settle and pay unpaid bills. We understand they are in a very difficult situation but they must have a repayment plan now that they will be in operation in 2022,” Mr. Selestino Babungi said. 

The payment of these outstanding electricity bills will uneasily accompany the opening of schools across the country in January next year, after two years of being shut courtesy of Covid-19 regulations. 

Educational institutions have already revealed that they languished under the weight of several debts due not being able to generate income when they were closed, even though they still incurred administrative costs and had to repay pre existing loans.  

That Ministry of Education and Sports said that the government is engaging the National water and Sewerage corporation (NWSC), UMEME Limited, Uganda Revenue Authority-URA and a miscellany of other financial institutions to waive the outstanding bills owed to them by educational institutions until the latter are able to generate the kind of income enabling them to pay these debts. 

NWSC, in particular, was asked by the government to waive the non-VAT fees for outstanding bills for schools from March 2020 to the time of re-opening. According to the ministry, NWSC is reportedly looking into the matter. 

Umeme Limited, according to its managing director, has experienced the bumps and shocks that come with the lockdown. 

“We had challenges in 2020 from when Covid was reported and the subsequent lockdowns. In 2020, we had flat growth and there was almost no growth. Electricity demand remained flat with a negligible growth of 0.6 percent,” said Mr. Selestino Babungi. 

In the last 10 months, according to Mr. Babungi, there has been a steady growth in electricity demand especially for industrial use. 

“The overall industrial growth is in the excess of 11 percent. The commercial category, which is a combination of small and medium enterprises, registered growth of 12 percent while domestic use grew at 6.3 percent,” he added.