March 2022 – Prime Time Communications

Out to Lunch

#OutToLunch Why you don’t necessarily have to withdraw your NSSF 20% savings

#OutToLunch Why you don’t necessarily have to withdraw your NSSF 20% savings By Denis Jjuuko Finally, Ugandans who save their money with the National Social Security Fund (NSSF) can get at least 20% of their savings and interest as long as they are 45 years old and above and have saved for 10 years instead of waiting to access the money at the age of 55. I had argued in these pages that people should qualify for 50% not just 20% but where I come from, they say first get what you can as you bargain for more. Many people who get lumpsum payments usually lose it in a short time either in wrong investments or simply fail to manage the windfall. It may sound weird but many of those who will get the money need to be sensitized to invest it and NSSF should regularly organize such seminars. Of course the hardest people to advise are those who have just received a good sum of money. The main reason people lose money is because they aren’t used to it or they invest in stuff they have no idea of. You will hardly find a business that isn’t profitable on paper — all business plans show profitability at one stage. However, many of the people who qualify to get this money are still somewhere employed and they could go slow in starting businesses. In Uganda, there is an overpromotion of self-employment as the only pathway to untold wealth. This narrative is misleading. There are employed Ugandans whose income is much more than what many business owners will ever make in a lifetime. Most self-employed Ugandans are hustlers — struggling to make ends meet on a daily basis and are usually one illness away from total financial apocalypse. They work longer hours without any holidays. Actually, for them, if they don’t work, they won’t eat. Raising capital is expensive and difficult. Taxes, rent, and the cost of doing business take way the little that they would have saved. Getting customers and contracts is difficult and payments sometimes take time. It may sound glamorous to mention yourself as a CEO, director or self-employed but many times what matters is what one takes home. So if you are 45 and qualify for the 20%, you don’t necessarily need to do anything with this money. You don’t have to withdraw it so that you start a business which you may not even have time to supervise in a week because of your job elsewhere. If you don’t have a business already, it takes on average five years to master it— establishing useful supplier contacts, understanding the customers, clients getting to know you and the tricks involved in running the enterprise. Many of the money used as start up capital in many cases is lost. Businesses in the earlier stages of their establishment largely survive on the founder’s tenacity. That is why many businesses that are started in Uganda don’t celebrate their fifth birthday. I know many people who have lost money by trying to start up side businesses or side hustles as we call them. So the beauty of the 20% midterm access to NSSF money is that you can get it any time as long as you are 45 years old and above and have saved with the fund for 10 years. There is no timeframe when you can access it. So if your idea is to start a business, first “chill” touching the NSSF money. Raise money through other means such as saving a certain percentage of your salary and start the business. Once the business is established and you have learned the intricacies of running it, you can withdraw the NSSF money and invest it in the business. That way you have to an extent firewalled yourself against losing this lumpsum payment. And where you invest it should be more than what NSSF is giving you as interest. Currently, NSSF is giving 12.5% annually as interest. So if you are withdrawing the money to invest it, the business should be able to give you more than 12.5% a year as net profit otherwise it makes no business sense to hustle and earn less than what you would earn from NSSF while doing nothing. The biggest problem with NSSF was inability to withdraw any money until age 55. Now that this is out of the way, NSSF earnings could be your ‘side hustle’ if you are above 45 years old. The writer is a communication and visibility consultant. djjuuko@gmail.com

March 18, 2022

Out to Lunch

#OutToLunch KCCA’s golden opportunity to create a taxi park free city

#OutToLunch KCCA’s golden opportunity to create a taxi park free city By Denis Jjuuko Kampala has two main taxi parks — the old one and the new one. They are just a few metres apart in downtown Kampala. Many taxis start their journeys from there either to Kampala’s expanding suburbs or to upcountry. But there are also many that start their journeys on stages in different parts of Kampala. Others simply keep moving picking passengers along the way. Both taxi parks can actually be a tourist attraction — if anyone can market congestion. Some people who own some plots of land where one of the taxi parks is located are demanding compensation of more than Shs300 billion without which taxis must find another place to park and wait for customers. However, the expansion of Kampala has created some additional small taxi parks in places like Nakawa and Nateete. When taxi parks were first created, they could have made a lot of sense. The two taxi parks sandwiched a bus park. Buses would bring in people from upcountry and the 14 seat taxis would pick them to their final destination in the suburbs. Eventually, those who didn’t want to wait for too long for buses to fill opted for the 14 seat taxis or the 5-seat Peugeot 504 for those going to Masaka. The bus park in Kampala is no longer centralized. There are a few bus parks from different locations still not far from downtown Kampala but not as close they originally were to both the new and old taxi park. Actually, one like Namayuba is a distance from the old taxi park. So do we still need to spend more than Shs300 billion to pay off landlords to have a taxi park in downtown Kampala? There are many options that the Kampala Capital City Authority (KCCA) could do with their Shs300 billion kitty. It could decide to work on roads – replace aging paved roads, expanding others, build new ones or install traffic lights in some. Kampala residents give their land free of charge for KCCA to build roads thereby reducing the cost of building new roads. So with Shs300 billion, KCCA can build a minimum of 120 kilometres of bitumen standard roads in Kampala. I shudder to imagine what Kampala would look like if in one or two years, 120km of roads were constructed. Kampala is such a small city so this would be massive. By just constructing new roads or maintaining others, small and medium enterprises would be set up employing many people. KCCA would make more money in trading licenses and property taxes. The economy would significantly grow. The construction of these roads alone would increase revenues of the contractors but most importantly a good number of people would get jobs. The Uganda Revenue Authority would collect more taxes. Many countries fix infrastructure to create new jobs and grow their economies. But also by actually not having taxi parks in the city and promote the replacement of 14 seat taxis with buses that carry at least 90 people would reduce the congestion in Kampala. Politicians need to stop fearing to replace taxis. Taxi owners can actually afford buses. Many of these owners own a few taxis which if they are sold, they can afford buses. Taxi owners and operators have saccos that have billions of money which they can use to buy buses. The government owns the majority shares in Kiira Motors so they can work with organized taxi associations and transport companies to get buses on favourable terms. The government can easily discount Kiira’s buses so these people can own the buses. Also, imagine if KCCA instead of paying off landlords they went and deposited this money for buses and tasked those who want to get buses to pick them and pay back in a few years with a little interest? They could partner with a bank to manage this buses-for-Kampala-fund. The other alternative for KCCA would be to use this money to create bus lanes in some parts of Kampala. You can easily stop people from driving into Kampala by turning parking lanes on the roads into bus lanes. Many of us would gladly leave our cars somewhere and jump into faster buses to the city. Like we have seen with bus parks that are private, business people can set up taxi parks if they wanted. So let us do the right thing and end the existence of taxi parks in Kampala and solve the congestion in the city. The writer is a communication and visibility consultant. djjuuko@gmail.com

March 14, 2022

Out to Lunch

#OutToLunch Passport office must benchmark the driver’s permit renewal system

#OutToLunch Passport office must benchmark the driver’s permit renewal system By Denis Jjuuko Sometime back, the countries that form the region known as East Africa decided that they needed to take the countries back to having passports that have the region’s name on it. They went ahead and even set a deadline which was extended in Uganda to 4 April 2022. Last week, the responsible body for Uganda, the Ministry of Internal Affairs, issued a statement that after that deadline, you won’t be able to leave the country on the old passport. If you come in with an old one, fine, but you won’t go back without a new one. A new passport costs Shs250,000 and if you want it made faster, you top it up with Shs150,000 to make it Shs400,000 (a sign perhaps of a deliberately slow system). That is not, however, the most bizarre thing about this passport renewal. If you have a valid Ugandan passport and you want the UN-blue colored one, you will have to do the process from zero. Imagine you have a valid passport but you are being asked to prove that you are a Ugandan. How do you prove that you are a Ugandan according to the Ministry of Internal Affairs? You must know the name of your father and mother’s grandparents! For my case, my father’s grandfather even had one name. Before formal education, Christianity and Islam took root in this part of the world, it was not uncommon for a child to be given only one name! But how will Ministry of Internal Affairs prove that the guy I indicate as my father’s grandfather is actually the one and even existed? My great grandfather died long before Uganda was created as we know it. My grandfather on my father’s side died shortly after Uganda had received independence. But by asking me for my parents’ national ID copies and then going on to ask who my relatives are and proving that I speak at least one local language yet I have a valid government of Uganda passport proves that the Ministry of Internal Affairs doesn’t believe in its own documents. My national ID issued by the same ministry is still a valid government of Uganda document. What is so difficult in just checking their database and align it with whatever information they need for the new passport? What is the purpose of the data in the national ID system if it can’t be used to renew passports? In Ghana, your national ID is your passport and you can use it in all International Civil Aviation Organisation (ICAO) compliant countries and 44,000 airports worldwide. I don’t think Ghana did anything special, they must just have applied and ICAO granted the permission. Maybe they added a chip where visas and all these things can be stored. With blockchain technology and other innovations, paper-based passports should be a thing of the past. But what makes a passport so special that the process must be repeated for those renewing? The Ministry of Internal Affairs simply needs to walk — yes, it is a walkable distance from their offices — to Nasser Road. On arrival at the start of Nasser Road, they should ask for Uganda Railways headquarters. They will see a government agency there that is responsible for renewing driving permits. It is called Uganda Driving License System (UDLS). They can do a benchmarking study on how they created a fast system through which Ugandans renew their driver’s licenses. You walk in and in under 30 minutes you are out with your renewed license. What is so difficult for the Ministry of Internal Affairs to create such a system for passport renewal? How difficult is it for the passport office to ask UDLS to give them the same system and procedure to use? They don’t even need to ask anyway. The director responsible for passports simply needs to go and renew their driver’s license and see how things work. Why should they even be a deadline for renewing a passport anyway? Simply renew those that are expiring. By creating deadlines while deploying a very slow system that requires one to know a name of an elder in the village or speak a local language (anyone can learn a local language anyway) and many millennials growing up in Kampala don’t even know their mother’s tongue is 19th century stuff. The writer is a communication and visibility consultant. djjuuko@gmail.com

March 14, 2022

Out to Lunch

#OutToLunch East Africa’s starving population calls for an agricultural paradigm shift

#OutToLunch East Africa’s starving population calls for an agricultural paradigm shift By Denis Jjuuko An eye-popping report in the East African, a regional newspaper caught my attention this week. It claimed that “some 50 million people in East Africa are hungry after two years of failed rains.” It further added that as people were starving, “Tanzanian maize exports are stuck at the border due to red tape. ”Yet there is nothing Africans claim to be good at and what gives them a comparative advantage than agriculture. If agriculture is our thing and we are so good at it, how can 3.5% of the continent’s population in just one region be starving to death due to lack of food because there is no rain? And also, like we saw last week, how can red tape at borders make it difficult for people to get food from a neighbouring country? If you drive through many parts of Uganda, you will see children with every symptom of malnutrition. On some of my travels in the countryside, I sometimes wonder what people actually eat. You can drive for many kilometres without seeing any garden anywhere. If you get off the main roads into the villages, you see a small garden here and there. You would think that if we can’t do agriculture at a commercial scale, at least let every home have a sizeable garden for their household needs. This was the case before. But Africa can’t continue to miserably fail at what they claim to be good at and instead resort to depending on organisations like the World Food Programme. A whole region like East Africa where we sing about political federation all the time can’t be lacking enough food to feed its citizens. East Africa is home to many water sources among which Lake Victoria and River Nile — two of the world’s biggest such water sources in the world. But if you drive a kilometer or two from the banks of River Nile, you see kids who haven’t had a proper meal in days. And in shops, you will see food imported from Egypt grown using the same water from River Nile. One of the reasons given for lack of food on the continent is usually drought due to poor rainfall. But where water is so near people, there aren’t any plans to use irrigation to water the plants in East Africa. Because of changes in the climate, droughts are increasingly going to be the norm rather than the exception. However, East Africa or Sub Saharan Africa for that matter isn’t the only region in the world facing climate changes. How come we can manage to import food from other regions which are also suffering from climate change? In 2019, Sub-Saharan Africa imported food worth a whopping USD43 billion and it is estimated to reach USD100 billion by 2030. This is a worrying trend for a region that looks at itself as an agricultural one that raises fundamental questions. Why can’t we be food exporters instead of importers? How come regions with equally severe weather patterns able to export food to Sub Saharan Africa? What is it that we are doing wrong? We are told that if you do the same thing over and over again with the same results, then there is need to change. One of such things that we need to wean ourselves off is rainfed agriculture and adopt technologies that can make us food secure. More harsh weather resistant food varieties must be developed and adopted by communities. Adoption of modern and affordable irrigation systems is important too. Talking about agriculture in fancy hotels while eating imported wheat flour and vegetables is something African policy makers must cease doing and get to the ground and help their populations adopt modern farming techniques. Villages can be organized in a way that they farm what they are good at using varieties that resistant to weather conditions but also by adopting better irrigation technologies. Post-harvest losses must also be avoided. In many parts of Africa, we can’t even preserve what we grow. In countries like Uganda, you find that during certain seasons, fruits and vegetables are so many that farmers are giving them away for free and yet within a month, there is so much scarcity for the same stuff. What is so difficult in creating a warehouse with enough coolers to keep vegetables for a few more weeks? What is so difficult in starting a tomato paste plant in a region known for growing tomatoes? Instead if you visit our supermarkets, they are full of imported tomato paste from outside Africa. The writer is a communication and visibility consultant. djjuuko@gmail.com

March 9, 2022

Out to Lunch

#OutToLunch No African country should be land locked

#OutToLunch No African country should be land locked By Denis Jjuuko There has been at least some good news this side of the world. Uganda’s oil is finally set to get out of the ground following the signing of the Final Investment Decision (FID) agreement in Kampala with partners committing to US$10 billion. Procurement of goods and services can now commence. There is a lot that has been pegged to this industry over the last many years and I hope that it realizes its potential and unlike many Ugandan projects, it is delivered on time. There was also the little issue of Rwanda opening its border with Uganda, which has been closed for at least three years. Many Ugandan businesses trade with Rwanda and the reopening of the border is good for both countries and the region. Although I am not sure what was the real reason for the closure, it is good that people can be able to move from one country to another again.Africa is home to 1.4 billion people, the same population as China but there are so many non-tariff barriers in place that hinder doing business. A spat between leaders of countries affects the entire region. Requirements for visas and work permits for countries that all belong to the African Union is a mockery of the body itself. Many times, Africans fly to other countries outside Africa where visas aren’t required or the process isn’t stringent than doing business with the continent. It is easier for a Ugandan to get a visa to Dubai or Turkey than to South Africa. So Africans take their money away from the continent because of such restrictions. Flying in Africa is one of the most expensive in the world and when you look at the air ticket, the biggest percentage of the cost for the ticket goes to taxes. Why do African countries make it so hard to fly from one part of the continent to another? Is it the mentality that flying is for the rich? I know the numbers of people flying might be low but then again isn’t it an issue of cost? If we make flying affordable, people will be able to fly and conduct business with one another. Kenya and Uganda usually squabble over whose goods are contravening regulations in another country. Quality is usually given as an issue though behind the curtain, the argument always goes back to who is benefiting from these barriers. There is always talk of about some of these African countries being land locked and how that curtails their economic progress. In the case of countries like Uganda, that shouldn’t be the case. Mombasa is just about 1,000km away from the Ugandan border and about 1,400km from Dar es Salam. That distance is so little to make a country like Uganda land locked. Investments in infrastructure and reductions in barriers that stop us from trading with each other would make almost no country in Africa land locked or lack a market in the hinterland. Just last month, procedures at the border in Malaba and Busia created an unimaginable fuel crisis in Uganda which will affect the economy for some time. Fuel prices are still high. Most of the tankers coming to Uganda and the region load the fuel a few kilometres away from the Uganda border. Why should they go through border clearance when they arrive at Malaba? Ugandan authorities can ensure that everything the trucker needs is done at the point of loading the fuel and then simply scan or measure at the border and trucks proceed. And this can be done automatically, so trucks don’t have to stop unless if there is a major reason that authorities should check for. Truckers carrying abnormal loads spend a few days at Malaba or Mutukula waiting for the clearance by the minister of transport before they access Ugandan roads. I believe that the construction of the oil pipeline and the central processing facilities will see a lot of importation of equipment and parts that transporters call abnormal loads and if they are all to be cleared by a minister in Kampala, this will delay the oil projects. The country has banked so much on oil that any delays will affect the delivery of the project. We can remove the barriers and make all countries in Africa trade with each other, access the seas and create meaningful jobs. The writer is a communication and visibility consultant. djjuuko@gmail.com

March 9, 2022