Makerere University sued for diverting UGX 4Bn retirement benefits

Makerere University has been issued with summons to file a defense within 15 days or else court will proceed and deliver judgement

Kampala, Uganda | THE INDEPENDENT | The registered trustees of Makerere University Retirement Benefits Scheme have sued the institution for alleged failure to remit more than four billion shillings to the scheme.

In the suit filed before the Civil Division of High Court in Kampala, the registered trustees contend that by a trust deed dated September 10th 2009, they agreed with Makerere University to remit to the scheme on a monthly basis 15 percent of all the University’s salaries held on trust by the trustees on behalf of the University employees.

According to the evidence before court, each employee was to get his or her own share upon retirement, early termination or to be given to family upon death.

In line with the deed, the records indicate that they were registered as a Trust by the Ministry of Lands, Housing and Urban Development and subsequently licensed by the Uganda Retirement Benefits Authority.

The records further show that as agreed and stipulated in the Trust Deed and the scheme rules, Makerere University has been making monthly contributions equivalent to 15 percent of each employees salary, five percent being deducted from the employee and 10 percent from the University as the employer.

However, the applicant contends that Makerere for the last three months did not remit it’s percentage.

“For the months of March, April and May 2021, the defendant/Makerere University only remitted to the plaintiff 5 percent being the employee contribution and did not remit 10 percent being the employer contribution,” reads the document in part.

On June 15th 2021, the Trustees demanded for the unremitted contributions but say they were shocked when the University Secretary Yusuf Kiranda directed the human resources and bursar to remit to the National Social Security Fund, the unremitted contributions for three months.

According to the University Secretary’s letter seen by URN, during it’s 152nd meeting held on June 11th 2021, the University Council considered the management of statutory social security contributions for the University staff and six observations were made. Key observations include the University’s obligation, unless exempted, “to remit staff social security contributions to the National Social Security Fund-NSSF, as required under the NSSF Act.”

It also noted that management had not yet provided evidence that the University had been exempted from contributing to NSSF”.

According to the University Secretary, “NSSF sued Makerere University over the non remittance of staff social security contributions, and management based on the council’s resolution in engaging NSSF with the view to settle the matter out of court.”

The letter dated June 14th 2021 also shows that the Council resolved that “Management remits the unremitted statutory social security contributions for staff to NSSF.”

But according to the applicant, the decision by Makerere University not to remit 10 percent contributions of the past three months payable to the Registered Trustees is in breach of the Trust Deed and is wrongful.

Through their lawyers of Acardia Advocates,  the registered trustees now want a declaration that the acts of the university in remitting the contributions to NSSF is in breach of the terms of the Trust Deed.

They also want a permanent order restraining the University from remitting the monies to NSSF as well as to be paid costs of the suit.

The Assistant Registrar of the Civil Division Agnes Alum has already issued summons to Makerere University to file a defense within 15 days or else court will proceed and deliver judgement in their absence.

She has also allocated the file to Justice Emmanuel Baguma, the Deputy head of Civil Division who hasn’t yet fixed a date for it’s hearing.

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URN