Any discussion about URA is not complete without praising Ms. Allen Kagina as one of the best leaders the revenue body has had. She has been described in superlatives. During her official send off, Prof. Vincent Chinedum Anigbogu, Director General Institute for National Development said of her as a rare and exceptional leader and added “I pray to God that we can invent a machine that can manufacture more Kaginas and we send them to the whole of Africa.”
Allen is said to have turned around an institution that was not only hated by Ugandans, but even the employees feared to associate with it. It was known as an axis of corruption and inefficiency.
In 2004, Allen replaced Annebrit Aslund (RIP) who had been at the helm of the tax body from 2001 to 2004. Critics thought Annebrit’s were too big shoes for her. After her tenure lasting a decade, they have been proved wrong, at least going by the accolades, reported statistics and name visibility.
In her ten year reign at URA since 2004, the authority is said to have undergone serious transformation. Using an analogy of the human body, Allen described the URA before 2004 as a walking dead which she managed to transform using the right diagnosis and treatment. And added that today “URA is a centre of excellence and a model for both public and private institutions fast changing into a breeder for next managers and leaders.”
Once described as the ‘wrong room’, the alpha and omega of corruption, inefficiency, tribalism and nepotism, URA had for days in order to pay taxes. It goes without saying that Allen’s tenure was a right timing. Any great thing was surely to be easily noticed.
On a financial perspective, revenue increased by 31.5 per cent from Ugx 1.92 trillion in FY the 2004/05 to Ugx eight trillion in FY 2013/14. Taxes now support 72 percent of Uganda’s budget up from 59 percent in FY 2004/05. This has been achieved through a series of interventions overseen by Allen.
We explore the impact of Allen Kagina’s leadership on the transformation of URA and the extent of luck and government support to her achievements.
Good leaders start with understanding the current situation – the process of taking stock of what is in place –at people, processes/systems, structure and other resources. Once this is done, they ask: who are my stakeholders and what do they expect of the institution. Then they go ahead to ask what should be in place to deliver the expectations of my key stakeholders (of course they make sure they understand all those stakeholders with must influence and interest). Allen identified the executive, media, tax payers, staff and development partners as some of the major stakeholders – with high influence and interest over the affairs of URA. She ensured they are on her side.
To answer the question of “what should be in place given the expectations from our stakeholders”, Allen’s first task was to undertake a study on the best practices of successful private companies in Uganda and across the borders. Globally, bureaucracy is a recipe for corruption and inefficiency. Her first move was to restructure URA by removing over 10 administrative layers from 17 administrative layers to seven. According to Allen, “the process
was necessary to make URA relevant to the changing times. It was time for URA to act as a business. It is unfortunate that some organizations still run on the same structures created 30 years. With changing business environment, such organizations have to remain behind.”
The leaner URA structure that could respond to the changing times was formed. Administrative posts that created unnecessary bureaucracy were removed. As such employees where reduced from over 2000 to 1500. Senior management was equally reduced from about 45 to 30.
The impact of this intervention, according to Allen, show revenue shoot up, implying sometimes organizations carry loads of people who reduce performance.
It is worth noting that restructuring initiatives have failed in some government institutions due to lack of executive support. When one gets a government job, they behave as if they have got a passport to a lifelong livelihood. Once they get that elusive appointment letter, is very difficult to withdraw it, due to unclear government exit procedures. Add the fact that merit plays a small role in getting most government jobs, a new leader finds it very difficult to effect restricting and terminations of non-performers unless with support from above.
This is where the Kagina factor comes in. She knew that to effect key changes like restructuring, the executive, particularly the President had to buy-in for support and ‘protection’ from the mafia. In Uganda’s leadership landscape, it is very difficult, if not impossible to effect key changes without the support of the executive. And by far, KCCA’s top honcho and ‘iron lady’, Jennifer Musisi’s success to date is attributed to her being on the right hand of the executive. Major changes like restructuring come with lots of pain to the affected. There will always be powerful forces to resist it.
Without the support of the President in particular, and the executive in general, it is difficult to remove over 500 people within a period of one year and survive them all.
An efficient board
The role of a board is to provide strategic oversight i.e. guidance to CEO and risk management to ensure going concern and protection of stakeholder interests. When the Board fails on this role, the organization will fails. During her talk on Open Minds forum, Kagina was very appreciative of URA’s board chaired by the experienced former Minister of Finance, Gerald Ssendawula. ‘‘The truth is no one can do the kind of transformation that has taken place at URA singlehandedly. I am privileged to have led a team of competent men and women who deserve the credit, the board, staff and senior management all played their role”, says Allen.
And that “I know of boards that do not give CEO the powers they deserve and when things go wrong, they blame the managers. The URA board, is different, it gave me all powers to run the operations.”
Moving power to the bottom
Bureaucracy is a number one killer of public institutions in Uganda. Something that would be resolved in minutes by one person unnecessarily goes through many people whose contributions are always only a signature.
In public service, your power is determined by your signature. Certain things may not move away from the desk unless someone has signed. It is this power that sometimes breeds corruption – after all, your document will not its signed.
‘‘We noticed this problem and had to remove power at the top because it was the source of inefficiency. People where shocked to learn that things would move without the Commissioner General’s signature.’’
Kagina explained that as such, power was given to middle and lower cadres who do the actual URA work and the rest of the managers concentrated on providing oversight, leadership and facilitating the process. This created efficiency at URA.
Conducive working environment
When you visit any URA office today, one gets to see good working environment. “After empowering lower and tactical officers, we went ahead to provide them with conducive office environment – computers, ample office space, Internet, telephone and URA brochures etc. When we did this, we began to see turn around – things were running smoothly”, says Kagina.
Training for staff
It is common for government officials to be transferred from one department or institution to another without equipping them for the next job or task. How do you expect them to perform? After the massive restructuring, the new team needed to be properly trained to deliver the much needed results and benefits the URA enjoys today.
Allen revealed that, to produce the results we needed, we had to undertake a rather expensive training, but which was necessary. URA budget for training increased from Ugx 200m in FY 2004/05 to five billion currently – that’s what it means if you what the best results.
Thanks to this continuous training, when her term expired, the tax body was spoilt for choice. Several commissioners had lined up for the job which went to Doris Akol.
In June 2012, the organization’s in-house information technology and human resource teams built an automated recruitment system to handle the overwhelming applications it receives. According to Kagina, the system has not only increased transparency but also reduced recruitment costs and improved turnaround. It is said the URA has also created strong strategic partnerships with leading local and international training institutions which provide specialized training to the Authority’s top managers. This is a welcome development.
No one is an island. Allen Kagina admits that URA could not stand alone in the desert. She says a lot of reforms undertaken were result of these great relationships – the partners provided a lot of great feedback which helped turnaround the organization that is now a darling of many.
“We began by identifying critical and significant local, regional and international partners that we needed especially on water because tax evaders can be dangerous yet we don’t have fire cover.
URA has so far built close working relationship with Parliamentarian, Judges, Clearing Agents, Accountants and Ministries.
The media was also recognized as key partner: they are the pipe through which public gets the news and all the developments. “In our previous life, URA never gave out information to the media – this kept the public in the dark, yet they have right to know what happens in public institutions.”
We now engage with media at all times. We do monthly press conferences to give an account of what we do. We report on corruption within the organization and this has enabled the public to look deep into the organization. Through monthly conferences, we tell the public which sectors are doing well and why.
The world is now a global village. Everything is being done online or it will soon be. The URA’s old system of sending her staff to client’s premises for 3-4 weeks where the client had to provide paper, room etc was not only a liability to the tax payer but also affected compliance.
Automation was the way out. This resulted into enhanced service delivery leading to drastic reductions in clearing line and compliance, increased availability of URA services through Unified Communications infrastructure (URANet) for both voice and data over a Wide Area Network (WAN) linking 62 operational points and remarkably successful introduction of electronic tax services under e-Tax, e-Payments and ASUCUDA++ which has since been upgraded to ASYCUDA WORLD, the system enables clients to access URA service anywhere in world.
In April 2014, URA launched the authorized economic operator (AEO) and month later the electronic cargo tracking system (ECTC) was launched. The system allows clients to have real time updates on the status of their Cargo as it is transported across the borders.
Engaging tax payers
One of the objectives of rebranding was to make URA customer friendly and become closer to tax payers. The old system where clients had to talk to URA authorities through small holes similar to those of banks was abolished.
Instead, an open space office model was adopted. Here a client relates freely with tax officials including managers. Clients can also transact with URA on 24/7, 365 days basis thanks to online service via URA web portal.
The tax body realized the need to go beyond enforcing tax laws to client management and ensuring fairness and execution of their mandate. They moved out and trained business associations. This improved complacency and surge in revenue collections.
Is URA beacon of leadership?
There is section of Ugandans who think URA could become a breeding ground of great leaders. The changes in Kampala city are visible thanks to the able leadership of Jennifer Musisi, a product of URA.
Some private companies are already looking to URA to recruit competent managers. According to Kagina such moves are okay. ‘‘When private firms start sourcing employees from public institutions, it is an indication that we are moving in the right direction.’’
With rumors that Kagina is likely to be appointed to head the impending Oil and Petroleum Authority, we can only expect better results. As they say, good luck is when preparedness meets opportunity. Allen Kagina prepared for the luck and the resulting success which many people have honored her for.
About the author
Moses Kaketo is the Editor and General Manager for Summit Business Review Magazine, holds a Master’s Degree in Business Administration from Uganda Management Institute, A professional diploma in marketing (CIM) and bachelors degree in Education. He sees business in everything. He loves writing business news, reviews and analyses