Uganda Airlines Faces Shs 237 Billion Loss, MPs Probe Aircraft Procurement and Operational Failures
Uganda Airlines is under renewed parliamentary scrutiny after the Auditor General’s report for the 2023/2024 financial year revealed the national carrier posted losses amounting to Shs 237 billion.
Appearing before the Parliamentary Committee on Commissions, Statutory Authorities and State Enterprises (COSASE), CEO Jennifer Bamuturaki and her management team defended the performance, attributing the deficit to high operational costs linked to the airline’s older Bombardier aircraft models.
“The largest contributors to our losses this financial year are high fuel costs, depreciation, and crew allowances. These have significantly affected our operational performance,” Bamuturaki explained.
MPs questioned why the airline was still operating outdated models that incur expensive maintenance and fuel bills. COSASE Chairperson Medard Sseggona warned that procuring such aircraft was proving unsustainable.
“There is no production. When there’s no production, it means I won’t have spares. I’ll acquire them at a high cost possibly even used spares and we all know how sensitive that is in the aviation industry,” Sseggona said.
The committee resolved to summon those behind the procurement decision to justify their choice. “Matters of accountability don’t expire when someone leaves office. We need to know the team that participated in the procurement. Chairman, use your powers under Article 90 to summon them,” MP Nathan Itungo urged.
Bamuturaki told MPs that Ephraim Bagenda was CEO at the time, supported by a technical task force. While some of its members have since left the country, others remain in the airline’s service.
MPs also expressed concern over the airline’s inability to pay dividends to its shareholder — the Government of Uganda — for the past two years. “I don’t want to see these zeros again when it comes to dividends,” Sseggona cautioned.
Bamuturaki revealed that 67.5% of the carrier’s operations are now funded through internally generated revenues, but acknowledged the need to broaden income sources. “We are now looking to diversify our revenue streams. At the moment, we rely heavily on passenger and cargo services,” she said.
The airline is further grappling with lawsuits over delayed cargo and lost passenger luggage, which MPs said should be resolved without forcing customers into court. “Why are people losing their baggage? And why should someone go to court to recover a bag? This is a matter that should be resolved well before litigation,” said MP Nkunyingi Muwada.
Despite the Shs 237 billion loss, sources say Uganda Airlines’ debt-to-GDP ratio remains under 50% and is not yet considered a critical economic threat.
