Britain freezes aid to Uganda over corruption concerns

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November 17, 2012 6:35 AM EST

Britain has suspended all aid to the government of Uganda over new evidence that British taxpayers' money may have been stolen, Development Secretary Justine Greening said on Friday.

Four European countries including Britain had already suspended some aid to Kampala over a growing scandal involving the theft of $13 million (8.1 million pounds) in donor funds meant for the reconstruction of two impoverished regions.

Britain had planned to channel a total of 27 million pounds in aid money through the Ugandan government this financial year. Friday's announcement means Kampala will not receive the remaining 11 million pounds that had been due by the end of March.

"Unless the Government of Uganda can show that UK taxpayers' money is going towards helping the poorest people lift themselves out of poverty, this aid will remain frozen and we will expect repayment and administrative and criminal sanctions," the Department for International Development said in a statement.

Norway, Ireland and Denmark have also suspended aid to Uganda. Britain had already frozen aid specifically to the prime minister's office in August.

Uganda's auditor general has implicated officials from the prime minister's office in embezzlement on a grand scale.

The scandal adds to concerns about corruption under President Yoweri Museveni, whose critics say has created a culture of impunity for cronies who steal public money while remaining loyal to the ruling party.

(Reporting by Estelle Shirbon; Editing by Robin Pomeroy)

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