Although the Shs26 trillion Budget for the financial year 2016/17 sounds big, the Minister of Finance designate, Mr Matia Kasaija, says Uganda needs more money than its currently budgeting to finance various government development programmes.
The size of the country’s Budget keeps increasing annually so do the needs of the economy grow, the minister said.
For example, in the financial year 2015/16, the total approved Budget was Shs23.972 trillion of which Shs17.329 billion was allocated for spending by ministries, departments and agencies (MDAs) and Shs6.643 billion for debt repayments plus interest.
For the financial year 2016/17, the size of the Budget has increased to nearly Shs26 trillion.
Mr Kasaija says more money is needed for building the necessary infrastructure to facilitate the country’s economic growth and development and for public servants to deliver high quality public services to the general public.
In an interview with Daily Monitor last week, on whether Uganda’s economy can absorb all the money it is being budgeted for, Mr Kasaija said: “The current size of the Budget is not as big as people may see it because Uganda’s economy needs more money than is currently being budgeted for, for the government to be in position of financing development needs.”
He said the size of Uganda’s economy is expanding and at the same time the population is growing.
Mr Kasaija said the real budget for the financial year 2016/17 is Shs21 trillion and the excess was for debt repayment.
“It is the money we have borrowed (on solidarity basis) which we now roll over in the 2016/17 Budget because we cannot keep going to Parliament asking for funds to pay the debt and interest on it,” he said.
Pressed with the question of low absorption of budgeted funds in MDAs, Mr Kasaija said it is not that the economy cannot absorb the money being budgeted for but the problem is the inefficiencies of the people managing the institutions.
Mr Kasaija said in order to enhance the effectiveness of the Budget and public services delivery, policy interventions will be implemented including; enforcing a Performance Management Framework that clearly links defining Budget allocations to sector outcomes and outputs.
In order to improve effectiveness and efficiency of public service delivery, the rules in place will be followed.
“We are going to strictly monitor and enforce performance contracts, and administer strong sanctions to accounting officers, who fail to adhere to set guidelines, renewal of appointments for permanent secretaries, chief administrative officers will take into account a proven track record of sound implementation of government programmes/projects and after a stringent vetting process, anybody who fails to perform will be asked to leave office,” he said.
Mr Kasaija added: “We are not going to continue having people who don’t implement government programmes in offices.”
The World Bank, Uganda’s major development partner, says undertaking investment requires sound fiscal and monetary policies that are capable of laying the groundwork to maximise growth through effective implementation of development projects.
In this regard, the bank says fiscal policy stance depicts a desire by the government to address the key binding constraints to growth and job creation.
It further says total revenue collection remains low and affects government’s spending on education and health.
However, it states that this challenge may be overcome as the dividends from investments are realised and used to support much faster growth and development, including human capital development.
In recent years, the bank says Uganda’s fiscal policy has not been lucky due to the way public investments are managed.
It adds that endemic delays in implementation, cost overruns and corruption mean that sometimes projects come in twice the original cost.
In an interview with Daily Monitor on Monday at Kampala Serena Hotel, the World Bank country manager, Ms Christina Malmberg Calvo, said Uganda’s economy can absorb Shs26 trillion Budget if the government strengthens the absorption capacity in institutions by effectively implementing projects.
The Buliisa County MP, Mr Stephen Mukitale, who was the chairperson on national economy in the 9th Parliament, said on Monday the Shs26 trillion Budget is good for Uganda to finance government programmes and projects.
“What is needed is strict supervision, monitoring, evaluation and effective implementation of projects for the country development programmes to move forward,” he said.
Source: The Monitor