Uganda lost huge amounts of money in unregulated mining and falsification of mineral data by groups trying to profiteer from the mineral imports and exports, a report of the Auditor General indicates.
The report, on the Ministry of Energy and Mineral Development Financial Statements for the Financial Year 2015/2016 unearthed irregularities in licensing and issues of mineral import and export permits.
The Ministry of Energy and Mineral Development, oversees the mining sector, including issuing exploration and production licenses and enforcing rules. The Minerals Act 2003 requires the payment of royalties in respect to prospecting and mining.
The Office of the Auditor General says the management assessed royalty and awarded exports for 93 kilograms of gold worth 11.82 billion Shillings. But corroborative reports from the Customs and Excise Department of URA indicated that 5,316 kilos of gold had been exported. The gold exports were valued at close to 700 billion Shillings, according to the Auditor General.
The government according to the report should have collected over 6.98 billion Shillings or 34.9 billion Shillings in royalties using the applicable rate of 1 percent or 5 percent for imported or locally mined gold.
The office of the Auditor General says there seems to have been no action on the offenders by the Ministry of Energy or Directorate of Geological Surveys and Mapping.
The Auditor General’s report also found that some of the mining companies operating in the country were defaulting in payment of annual rental fees and tasked the Ministry of Energy to put in place controls over mineral imports and exports given that minerals are non-renewable resources.