Shs 35bn Irregular ‘Passenger Service Fees Missing at Uganda Airlines

Kampala

Uganda Airlines’ top management is once again in the spotlight after a special audit uncovered the irregular collection of USD 9.2 million (Shs 35.2 billion) in service fees from passengers, money that auditors say cannot be traced to the company’s accounts and may have been misappropriated.

The Auditor General’s Special Audit Report on Revenue Management and Aviation Fuel Management for FY 2021/22 to 2023/24 found that despite a formal communication scrapping the USD 30 service fee for walk-in ticket purchases effective July 1, 2023, staff at several airline offices and General Sales Agents (GSAs) continued charging the fee for a full year.

An email dated June 26, 2023, from the Manager of Revenue Management, clearly directed that effective 1st July 2023, the USD 30 service fee for walk-in ticket purchases at airline offices would no longer apply.

Yet, according to the audit, analysis of the detailed sales report for the period 1st July 2023 to 30th June 2024 revealed that service fees totaling USD 9,294,640 were still charged across multiple Uganda Airlines offices and General Sales Agents.

Stations implicated include Kampala, Entebbe, Dar es Salaam, Nairobi, Juba, Kilimanjaro, and Johannesburg.

Most troubling, auditors reported that there was no evidence of these service fee collections being banked, raising concerns about potential misappropriation.

The report went further, exposing governance failures at the airline’s top management.

The audit attributed the scandal to “non-compliance by responsible station staff, likely caused by inadequate supervisory oversight, and a lack of monitoring controls.”

In its response, Uganda Airlines management acknowledged the audit findings but sought to explain them away.

Management also pushed back against the auditor’s recommendation for stronger board involvement.

The missing USD 9.2 million is only the latest in a string of financial and governance concerns at Uganda Airlines, which has also faced allegations of irregular aircraft procurement deals, ticketing conflicts of interest, and fuel supply scams.