Masaka Cooperative Union sets up credit arm to support members

In December 2019, Masaka Co-operative Union formed a financial cooperative to boost coffee production capacity in the region.

For the last 70 years, Masaka Co-op union has worked with primary societies involved in coffee production in the greater Masaka region that comprises the districts of Lyantonde, Ssembabule, Bukomansimbi, Rakai, Lwengo, Kalungu and Kyotera.

According to Emmanuel Ssenyonga, the General Manager, the union was started in 1951 to combat oppression of indigenous business people involved in the coffee sector by Indians who dominated trade in the lucrative crop.

“The Union was a hedge against the bad practices of buyers. Indians owned the factories at the time, and because Africans knew nothing, our farmers’ coffee was under weighed and they were paid less than their due,” says Ssenyonga.

In the 1980s, Masaka Union started to supply the export market directly and was thus able to provide farmers a better bargain on their coffee and even give them premium pay.

However, Masaka Co-op Union was, like other unions in the country, hard hit by the wars that rocked the country between 1979-85.

Joseph Kavuma, the Union Chairperson says the Masaka Cooperative Union has struggled to recover ever since.

“All union operations were halted. We even retrenched most of our employees and only remained with a skeleton staff of four people because business was no longer running,” Kavuma says.

In addition, the Union was forced to sell most of its enterprises including ranches and coffee factories to clear the outstanding debts.

Worse still, the Union remained without working capital to resume its normal coffee business.

Restoring through a SACCO

It is against this background that the union decided to set up the Masaka Union Co-operative Financial Services Limited (MUCOFI). Launched on December 8, 2019, the financial cooperative will contribute to the Union’s grand goal of reviving and boosting coffee production in the region.

The Union’s Chairperson hopes that, by providing farmers with affordable credit, MUCOFI will deliver them from the clutches of predatory lenders and enable them get a better price for their coffee.

“Our farmers got tired with private buyers because whenever they had a problem, they would sell their coffee during flowering stage. So we set up a financial Centre where farmers could get ‘coffee loans’ a lower interest rate of about 1.5% per month instead of being cheated by private buyers,” Kavuma explained

According to Bukenya Swaleh, MUCOFI’s accountant, the relatively new SACCO already has 456 members, with a turnover of Shs 1.1bn.

“Our capital base is about Shs 1bn and our loan portfolio stands at Shs 654 million,” said Swaleh

The SACCO has total savings of Shs 83m and members’ share capital stands at around Shs 40m.

However General Manager Ssenyonga says the union is slowly getting back to its feet by using the Shs 17.8bn partial compensation the Union received from government to resume coffee buying and export.

“We hope to facilitate more members and build stronger societies. This means more production and increased exports as a result. This is where we are heading to,” says Ssenyonga.

The Union has also embraced value addition and has started producing roasted coffee for local consumption.

“Right now, we have pilot experiments going on. Over the next five years we expect to introduce roasted coffee beans onto the local market so that we can start consuming our own coffee,” he said.

He called upon government to utilize unions and other cooperatives in providing quality inputs to farmers.

“In the early 1990s, the government used to acquire agricultural inputs through Coffee Marketing Boards and send those inputs to the unions in the districts, which would then dispatch them equitably to the farmers,” Ssenyonga recalls.

This system, he believes, gave government a better estimate of the appropriate inputs required by the farmers.

“This is unlike today where farmers’ inputs decisions are taken either by the NAADS Secretariat or Operation Wealth Creation officials (OWC), which results in wrong input and season timings, and poor quality deliveries.”

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MUK don urges government to quickly resolve MUBS staff salary disparity

Dr. Deus Kamunyu Muhwezi, the Chairperson of the Forum for Academic Staff in Public Universities (FASPU) called on government to resolve the outstanding issue of salary disparity for academic staff at Makerere University Business School (MUBS) and align it with the salary scale for existing Public Universities.

In an interview with theCooperator, the FASPU leader revealed that the issue at MUBS is that different categories of staff earn different salaries based on different appointment terms, a practice he says does not cohere with the rules governing staff remuneration in public universities.

“We stand with MUBS staff and the Government must urgently address this matter, beyond which we shall not hesitate as public universities to lay down tools in solidarity with MUBS,” Kamunyu said.

On November 15, 2020, Makerere University Business School Academic Staff Association (MUBASA) committed to an indefinite industrial action by the teaching staff, citing inconsistency in their current salaries with the Government wage bill structure for other public universities.

“The issue is underpayment. As academic staff we expected our salaries to match what the Government gives to staff in other Universities,” said Brian Muyomba, the Chairperson, MUBASA.

He vowed that MUBS’s academic staff will not relent until their expectations are met by the Government.

Varied wage categories

Currently, six wage categories exist for different staff on the MUBS payroll.

620 out of 1,187 staff members were appointed by the MUBS University Council and are under the ministry of Public service salary structure, with a 38.7 bn wage bill per year.

Moreover, 80 staff members under the Integrated Personnel and Payroll System (IPPS) are still earning salary at their previous rank, despite having been promoted. The annual wage bill for this category is 6.5 bn.

The third category includes staff appointed by the Universities Council on permanent terms. 97 in number, they are paid by the University (not Government) with a wage bill of over 3.5 bn annually.

Staff who are paid by MUBS on appointment by the University Council on local contract terms are 46, while those appointed by the University Management under a similar arrangement number 299, with a wage bill of 1.3 bn and 7.7 bn per annum respectively.

The last category consists of 45 Administrative Assistants appointed by MUBS, with a wage bill of over Shs 864m per year.

In a letter dated September 1, 2020, Minister Muruli Mukasa recommended that the Government takes over the wage bill for 843 MUBS staff to match the pay scale for public Universities. He proposed that the government covers a wage deficit of over 4.92 bn that would enable the University meet its wage bill of 58.711 bn required for 2020/21.

“Considering that wage for only 843 staff has been observed to result in extremely low staffing levels of below 30%, the ministry therefore advises the management of MUBS to capture its staffing needs and submit in the recruitment plans for FY 2020/21. Once funds are provided, then these positions should be filled completely,” Muruli said.

Meanwhile, said the MUBS administration partly bears the blame for the current stalemate at the university.

“If there had been progress, maybe lecturers wouldn’t have threatened. This is an injustice that a normal management would appreciate and have it sorted. Much as the Government has resolved to have this ironed out, there are delays on the side of MUBS management,” Kamunyu said.

“We ask MUBS to cooperate with the Government such that this problem can be dealt with before we are all drawn into this course of action,” he added.

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