The leadership of car dealership associations in the country early this month lifted the lid on frustrations, hurdles, and bottlenecks surrounding acquisition of digital/electronic number plates.
They surmised that the country sleep walked into the system while the Russian manufacturer, Joint Stock Company Global Security (JSCGS) appears overwhelmed.
While appearing before the Sectoral Committee on Physical Infrastructure on September 2, the leadership of Kampala City Traders Association (KACITA), Federations of Uganda Customs Agents and Freight Forwarders (FUCAFF), and Associated Motor Dealers, that represents motor vehicle importers and bond dealers, raised a litany of concerns that have worsened backlog of cars without number plates and exacerbated systematic corruption as desperate car buyers are cornered to pay kickbacks to get plates swiftly.
The concerns range from disharmony between Uganda Revenue Authority (URA) and customs agents, insufficient training and awareness among custom agents, weak stakeholder engagements, inadequate implementation centers, a lack of a clear policy to integrate customs operations with the new technology, and quadrupling of costs for number plates: Shs714,000, up from Shs137,000, for first time registration for all automobiles.
‘It should be noted that this cost is transferable to the end user which ultimately raises the cost of the unit cost consumed. A transparent breakdown and justification of the costs would be considered and for public interest. The cost should not exceed at least Shs400,000 for a new motor vehicle number plate and Shs150,000 for motorcycles, while the replacement fee should be maintained at Shs50,000 for all categories,’ Mr Abel Mwesigye, the KACITA representative said.
Similarly, officials from Associated Motor Dealers and FUCAFF laid bare a number of challenges plaguing the digital/electronic number plates supply chain, much to the puzzlement of lawmakers. Some lawmakers, sworn in from May 13 to May 15, and received their Shs315m one-off vehicle grant in mid-July, shared their personal experiences about the challenges associated with the electronic number plates.
Digital/electronic number plates technology is part of the Intelligent Transport Monitoring System (ITMS) project implemented by the ministries of Works and Transport, and Security. How the plates exactly work in the absence of robust infrastructure for wireless technology that connects to central monitoring systems remains a mystery.
Veneer of innovation?
Officials have previously explained that digital plates integrate unique identification features, such as embedded microchips and quick response (QR) code or RFID tags- a type of technology used to automatically identify and track objects-that make it easy to track automobiles. These are directly linked to a central database.
While defending and popularising the technology, one of President Museveni’s June 2018 blueprint for curbing high-profile criminality, officials cited additional advantages of easily tracking and recovering stolen automobiles
However, KACITA officials told the Mbarara South Division MP, Mwine Mpaka-led committee that a significant number of motorcycles mounted with the digital plates since early November 2024 have been reported stolen and have not been traced despite efforts by their owners.
‘This raises questions regarding the effectiveness of the system in delivering one of its primary objectives of enhancing security and facilitating identification and recovery of stolen assets,’ Mr Mwesigye added.
The Physical Infrastructure committee in earnest kicked off the electronic/digital number plate scrutiny in late August with summons to officials in the ministries of Works, Security, Internal Affairs and Justice and Constitutional Affairs.
The Security Minister Jim Muhwezi appeared before the committee on August 26 to request for time to allow the responsible agencies to prepare coordinated responses. However, almost a month later, officials are yet to appear before the committee.
The car dealership associations told the committee of a backlog of vehicles without plates, owing to shortages at the manufacturing level. They further explained that for instance, there is a backlog of 200 vehicles pending fitting with the plates and taxes were paid last month, when the plates are available; the system does not follow a sequence; it follows what is available that day going backwards.
Confidential documents seen by Daily Monitor indicate that the government’s coveted ITMS project was not backed by cogent studies to establish ‘optimal benefits.’
An internal memo by the Ministry of Finance for the review of the ITMS feasibility study details that the project implementer, the Russian company, JSCGS, provided a blanket figure of $127m (Shs449b) as the project cost without detailing an affordability assessment nor accompanying financial model showing a breakdown of project and operating costs and the proposed cost recovery mechanism.
‘There is no assessment on the affordability of the project to the Ministry of Security and office of the President, and the impact of the project on the contracting authority’s budget if any,’ the memo reads in part. The assessment report is key ‘for purposes of streamlining and committing resources if needed’ towards project implementation.
The memo dated August 22, 2022, further, details that the Russian company’s feasibility study report-which assesses the potential for success of a proposed project-did not include a risk analysis nor detail particular risks or assign any to specific parties, leaving the government exposed.
‘No value for money assessment has been included,’ the memo reads, further detailing that the company assessment report also did not include solid cost parameters for the entire project duration nor any envisaged future contingent liabilities.
The Office of the President had requested the Finance Ministry on August 16, 2022 to review the Russian company’s project documents.
Behind the scenes
Inexplicably, documents reveal that the digital plates’ feasibility study report was put together by a working group comprising officials from the Ministries of Security, Works, and Finance, Solicitor General’s office, Uganda Police, UPDF and its commercial arm- National Enterprise Corporation (NEC), National Information Technology Authority Uganda (NITA-U), URA, Kampala Capital City Authority (KCCA), and JSCGS.
A feasibility study is a formal evaluation that tests whether a proposed project or business venture is practical, achievable, and worth pursuing before you spend time or money. Ordinarily, the feasibility study report is prepared by prospective investors.
After the working group’s report, Gen Elly Tumwine, then as Minister of Security, in September 2020, recommended implementation of ITMS in a phased manner, covering ‘a restricted number of vehicles and motorcycles to be able to ascertain the detailed project scope in terms of data required per month, man-hours, duration for full commissioning, etc.’
Even then, the Finance ministry memo states that the Russian company in its pitch provided only ‘one option for improving security and tracking vehicles without offering other potential options nor reference on their comparative advantages and disadvantages.’
The Finance memo inferred that the Russian company’s feasibility study and financial model were at best sketchy, and did not indicate explicitly ‘financial commitments and contingent liabilities nor made any disclosures’ and did not clarify ‘on future hand back costs if any.’ Hand back expenses refer to costs that arise at the end of the contract.
The Russian company’s sketchy risk analysis, the ministry noted, did not highlight technology-related risks and transfer, costs and management, mitigation plan nor apportionment of the relevant stakeholders. Also, the feasibility study report did not indicate ‘key performance indicators’ against which the performance of the Russian company would be assessed.
This newspaper reached out to JSCGS for a comment on the matter but got no response. Officials from the Ministry of Work and Transport, which oversees [digital] number plate manufacturing, declined to be drawn into discussions on the matter, and referred to the Ministry of Security regarding the pre-implementation processes.
JSCGS, according to the Finance memo, also erroneously stated in its study report that the subsisting legal framework did not provide a clear process of Motor Vehicle registration, manufacturing of number plates, accountability for issuance, storage, disposal and monitoring of number plates. The company also claimed that the then process at first-time registration, post-registration and number plate printing were not governed by the law.
Conversely, Section three of the Traffic and Road Safety Act, 1998, provided for registration and re-registration of motor vehicles in the country. The Traffic and Road Safety (Vehicle Registration, Licensing and Third-Party Insurance) (Amendment) Regulations, 2012, provided for the process of first-time registration and re-registration, the payable fees, and the specifications for the license plates to be issued.
According to the memo, the company also did not provide a ‘clear data protection plan’ in conformity with the Data Protection Act, 2019, for the considerable data collected from the public motor vehicle owners.
‘It is understood that this (data collection) will be done in the interest of the public and national security, but the proposal should also give a detailed approach for ensuring that individual privacy is protected and the data collected is not used wrongly,’ the memo reads in part.
Regarding the usage of existing government infrastructure, documents reveal that the company did not provide how the traffic system ‘will be integrated with the Closed-Circuit Television (CCTV) network in Uganda and if any modifications or adjustments have to be made to the existing system or otherwise.
Sketchy studies, models!
Following a thorough scrutiny of JSCGS’ feasibility report, co-prepared by the government, the Ministry of Finance wrote back to the Office of the President indicating that ‘without a value for money assessment’ there was no justification for the project, and ‘particularly implementing it as a Public Private Partnership’ (PPP) as the Russian company had initially floated.
‘No detailed financial model has been submitted. The financial model is crucial for purposes of establishing core project assumptions, costings, sensitivities, fiscal commitments and structuring of a repayment plan. In the absence of the model, the financial obligations of the government remain uncertain, and the basis for the estimated project cost cannot be ascertained,’ the Ministry of Finance said in the rejoinder.
The Finance ministry recommended to the Office of the President that JSCGS address the massive gaps identified in their sketchy study and resubmit the report for further assessment to take the project forward.
It is not cleared whether both the Russian company and the Office of the President addressed the concerns identified in the review.
However, Mr Matia Kasaija, then as Minister of Finance, on September 9, 2022, wrote to his Ministry of Security (under the Office of the President) counterpart, now the late Gen Eli Tumwine, and the then Attorney General, Mr Kiryowa Kiwanuka, noting that the ITMS project falls short of a PPP undertaking, as previously guided by the President, owing to the concerns raised.
‘In light of the above, it is advised that the Ministry of Security proceeds to implement the project under a classified arrangement as provided under existing legal processes,’ Mr Kasaija wrote.
The Finance Ministry, according to correspondence, had earlier in September guided the Ministry of Security that the ITMS cannot be developed as a PPP, as legally, the procedure would require making all project details and documents ‘public.’
President Museveni first hinted at mounting tracking chips on all boda bodas and vehicles during his address to parliament on security in the country in June 2018 in the wake of the assassination of Arua Municipality MP, Ibrahim Abiriga in June 2018.
The move was part of the President’s 12-point plan, including fingerprinting all guns and installing CCTVs on streets to fight high-level crime in the country and curb high-profile criminality in the country.
Following the President’s pronouncement, documents seen by Daily Monitor indicate that officials from the Ministries of Security and Works, respectively, went to work to procure ‘a tracking solution.’
Later in 2019, JSCGS arrived on the horizon for the venture. The company, according to knowledgeable sources, was introduced to the President, who in turn directed that it work with officials in the ministries of Works and Security. Rather, officials went about frustrating the company on the deal.
The President, according to correspondence, selected a team to conduct due diligence on the company. Consequently, on November 18, 2019, President Museveni wrote to the then Prime Minister Ruhakana Rugunda introducing JSCGS.
‘A Russian company came up with such a solution. They are ready to implement it at their own cost and will recover their money from a fee put on each platform that will be agreed with the government. Some time ago, they seemed to have finished their assessment and they are ready. However, they are being tossed around,’ President Museveni wrote.
He added: ‘Besides, I hear that the Ministry of Works and Transport is trying to get another system. This is a duplication. One system is enough for the country.’
From digital chips to AutoEPS
The President further spelt out four directives: that JSCGS be immediately allowed to start on the project; recover their money from a fee agreed with government-he said if criminals migrate to bicycles, we may add them in future; the project should be implemented as a classified one; and no other government agency be allowed to acquire a parallel system.
‘No more delays. The only alteration to this order will be if the technology doesn’t work. What do you want the technology to do? It should the following: track, electronically, all the vehicles and piki-pikis; and, if anybody tries to tamper with the electronic devices or tries to remove the number plates, the central brain of the system should be alerted, and security should go for him/her,’ Mr Museveni wrote.
Accordingly, a multi-sectoral project management team was established to handhold JSCGS on the project.
While intelligent transport solutions and systems, to improve efficiency and safety, have been applied in nearly all major cities around the world, there is no readily available information on which country has successfully mounted digital tracking chips functioning in real time.
Even with Uganda as a pioneer, some [IT] pundits have variously questioned how the system will work in the absence of extensive and robust internet infrastructure, including a wireless system, on the streets and across highways to enable the trackers sync with the command center/database to track and monitor all automobiles in real time.
Some European Union countries, with such infrastructure, require digital chips mounted on only specific vehicles, such as those transporting hazardous materials, commercial trucks, and public transport.
As for Uganda, to this day, JSCGS’ technology is not properly explained. The company once defended the decision in order not to tip off criminals, including car-jerkers.
There is also no readily available information on where the Russian company has employed the coveted technology before, not even in its home country. A trove of government documents relating to the ITMS is silent on the same.
In June last year, JSCGS and the Ministry of Works were thrust into a storm of rolling out the Automated Express Penalty System (AutoEPS), a novel idea to curb indiscipline on the country’s roads and a modern concept for traffic enforcement.
Days after piloting the system a number of concerns emerged: the unrealistic speed limits, lowered from 50km/hr to 30km/hr in urban areas, against which extortionate fines were enforced; poor signage of where the video surveillance has been installed, and revelations by a parliamentary committee that the Ministry of Works had entered into a dubious revenue-sharing arrangement with the company.
Sources indicated that the company had banked on the hefty fines to bankroll its number plate printing venture, which, since the signing of a Memorandum of Understanding (MoU) in July 2021 with the government, had been set back by liquidity challenges.