MPs on parliament’s Committee on Commissions, Statutory Authorities and State Enterprises (Cosase) have questioned the National Social Security Fund (NSSF) over its investment in the Kampala Marriott Hotel.

They asked whether the fund got good value for savers’ money.

The committee chair, Muwada Nkunyingi, the MP for Kyadondo East, put the question to journalists and NSSF officials during a session at parliament.

“Prove us right or wrong. Tell us about your involvement in the ownership of Marriott hotel,” he said.

The fund’s managing director, Patrick Ayota, appeared with the fund’s lawyer, Isaac Ogwang.

Ayota said NSSF owns a 30% stake in CS Hospitality, the company behind the hotel. Marriott, he said, is only the operator.

He said the fund invested about two years ago, before the hotel was completed.

The disclosure sparked a heated debate among committee members.

Martin Muzaale, the Buzaaya County MP, asked why the fund put Shs180bn into the Marriott when it could have bought its own property for less.

He said the Sheraton Hotel was on sale a few months ago for less than $50m.

Eliab Naturinda, the Ndorwa East MP, accused NSSF of rushing into new projects before fixing problems with old ones, such as the Temangalo land.

Gerald Nangoli, the Elgon North MP, questioned how independent the valuers of the Marriott investment were.

He also asked what would happen if the hotel failed to reach its 60% occupancy target.

Nkunyingi asked what safeguards protect the fund’s 30% shareholding.

Ayota said the fund was attracted by the expected return on investment, and that tourism was becoming a major source of revenue.

He said the project had an initial cost of $200m.

He said the remaining shares belong to the people behind the Capital Shoppers supermarket chain.

According to Ayota, NSSF holds veto powers in the hotel’s management through two of the five seats on the board.

He said investments go through several layers of approval, and that the chief government valuer is involved in every NSSF transaction.

Nkunyingi asked the officials to submit documents on both the Marriott and Serena joint ventures.

Temangalo petitions

Earlier, the committee had hoped to dispose of petitions filed against NSSF.

They came from Temangalo Tea Estate Limited, the family of the late Daniel Ssaku Mugwanya, and AK Mugisha and Company Advocates.

The petitions were presented to the Speaker, Jacob Oboth Oboth.

Nkunyingi said the committee could not reach Temangalo Tea Estate, whose address is in Vancouver, Canada. Its international phone numbers and emails were not working.

The company says it owns the Temangalo land after securing a lease from the Departed Asians Property Custodian Board.

Ogwang told MPs the fund knew of the case, but it had not been finally decided and was still in court.

He said the High Court handled the matter on 27 November 2020, and an appeal followed in the Court of Appeal.

He added that the fund had not met the petitioners in court, but believed the process would deliver justice to both sides.

Ayota confirmed that NSSF knew of the Temangalo Tea Estate suit and its claim to a lease on the property.

George Musisi, the Kira Municipality MP, suggested giving the courts time until the case is settled. He noted that the petitioners had also agreed the matter was before court.

Muzaale agreed, saying the petitioners, in the committee’s presence, had left it to the courts.

He said a court verdict would help deter future claimants.

Gerald Nangoli and Julius Nakiyi also backed leaving the matter to the courts.

Musisi said the committee’s hands were tied while the case was pending.

Nkunyingi asked whether mediation was under way, since the Mugwanya family had shown interest in it.

Naturinda said Rule 75 of parliament’s rules of procedure was being used as a “political shield”.

He accused NSSF of being insincere with Ugandans after learning that talks with businessman Amos Nzeyi were in their final stages.

Fortunate Biara, the Bufumbira North MP, accused NSSF of procurement gaps that put savers’ money at risk.

Geofrey Wokuri, the Bungokho MP, urged the fund to build a positive legacy rather than spend its time settling cases filed against it.

Ayota responded that NSSF owns the Temangalo land.

He said talks with Nzeyi to recover 55 acres were in their final stages, and that joint surveys would soon begin.

He said the negotiations began two days ago and would bring harmony. Once they conclude, he said, the Attorney General will sign the final document.