Draft estimate for the Financial Year of 2015/2016 and how it’s expected to be. It will be a bunch of numbers and I have picked the ones that seem special. The ones that could be questioned and ask yourself why they use so much money on? That tells about how much the government of Uganda planning to use on certain pieces of civil service and ministries that they run. Everybody that wants to look and understand a bigger picture will get a bit more information. But even if this feels like a long piece. Remember the document that was swallowed into this was close to 1200 pages. So that I have written a long piece it’s a reason why and how it became this long. Hope your get some insights and it was worth my time.
Piece by Piece, Government Organization and Ministry:
Office of the President:
The Salaries are the same from 2014/2015 to 2015/2016. No change the same 26,233,125 UGX. The rest of the expenditure is the same except for the secret payment between the financial years and that is the “Classified Expenditure” which goes up sustainably from 2014/2015 when it was 11,069,633 to the next 2015/2016 it becomes 18,069,633. So it means that the Office of the President has one expense that goes to something secret and is up 7,000,000 from last year and the only one(Draft Estimates P: 30). There has even been another classified expenditure that is set for 3,940,034 UGX and this is not for the main Office of the President, but to the specific program of “Monitoring and Evaluation” (Draft Estimates P: 35). Total for the Office of the President is 53,835,847 UGX (Draft Estimate P: 42).
Another “Classified Expenditure” is set for the FY 2015/2016: 36,700,000 UGX (Draft Estimates P: 44). The Total for the Statehouse is 253, 226,426 UGX (Draft Estimate P: 43).
Office of PM:
Total budget for the Office of the Prime Minister is set to be for the FY 2015/2015: 146,581,639 UGX (Draft Estimate P: 82).
“Construction of Pakwach, Kabale, Morulem, Napak Police stations completed; Construction of a staff accommodation block of 4 units at Alebtong completed; Armouries constructed at Ikaffe, Kabalye and Olilim PTS; 10 vehicles procured for PRDP districts; ICT machinery and equipment (communication equipment) procured; Office furniture for Buliisa, Aleptong, Bukwo and Yumbe procured)” (Draft Estimates P: 25). The estimated budget for the UPF is 4bn for the FY 2015/2016.
Gen. Kale Kayihura Salary is from next year 103,200,000 UGX (Draft Estimates P: 24).
Uganda Police Force:
Directorate of Counter Terrorism in FY 2015/2016 is 10.254.176 UGX (Draft Estimate P: 834). Directorate of Interpol & Peace Support Operations in FY 2015/2016 is 4.265.402 UGX (Draft Estimate P: 835). Kampala Metropolitan Police in FY 2015/2016 is 19.606.632 UGX (Draft Estimate P: 837). Specialised Forces Unit in FY 2015/2016 is 129.002.902 UGX (Draft Estimate P: 838). Assistance to Uganda Police – Purchase of Motor Vehicles and Other Transport Equipment – Transport Equipment and Aircrafts in FY 2015/2016 is 36.439.322 UGX (Draft Estimate P: 838)
Grand total for the UPF in FY 2015/2016 is 435.133.848 UGX (Draft Estimate 839).
External Security Organization:
A budget issue that is weird that the ESO in the voting didn’t put any funds for staff training for FY 2015/2016 (Draft Estimate P: 917).
Grand total for FY 2015/2016 is 18.359.204 UGX (Draft Estimate P: 914).
Prison and Correctional Services in the FY 2015/2016 is 136.960.199 UGX (Draft Estimate 840). Murchison Bay Hospital in the FY 2015/2016 is 418.750 UGX (Draft Estimate P: 844). Grand total for the Uganda Prisons in the FY 2015/2016 is 136.960.199 UGX (Draft Estimate P: 848).
Ministry of Defense:
Total Vote for the ministry: 1,460,211,641 UGX (Draft Estimate P: 84). The ones that caught my eyes was first Welfare and Entertainment went from last Budget Year 2014/2015: 27,190,131 and this year 2015/2016: 37,614,465 UGX. Special Meals and Drinks a new post in the ministry and costs: 94,645,610 UGX. Subscriptions we’re 2,699,752 UGX in 2014/2015 and next year 2015/2016 cost 12,099,752 UGX – for those who can see that is nearly up 10,000,000 in one budget year! My favorite post in any ministry: ‘Classified Expenditure’ in 2014/2015 costed 342,252,085 and next budget year 2015/2016 all of a sudden 606,304,585. The difference between the budget years is 264,052,500 UGX. The Classified Expenditure is spilt in two pieces. First one is the UPDF Support and is set for 258,578,085 (Draft Estimate P: 86). The second one is Defense Equipment Project is 342,352,500 UGX (Draft Estimate P: 87). AMISOM operation total is 269,784,415 UGX. Classified Expenditure for AMISOM is 5,374,000 UGX (Draft Estimate P: 88). External Project Financing: Defense Equipment from Russia is estimated for FY 2015/2016: 264,052,500 UGX and to AMISOM is 298.266.10 UGX (Draft Estimate P: 81).
Ministry of Public Service:
Total budget for is set to 21,908,949 UGX (Draft Estimate P: 103).
Ministry of Foreign Affairs:
Total budget is set to 26,605,155 UGX (Draft Estimate P: 117).
East African Community:
Grand total to the EAC in FY 2015/2016 is set to 24.407.661 UGX (Draft Estimate P: 505).
Embassies and consulates:
Mission in New York:
Grand total for FY 2015/2016 is 16.144.072 UGX (Draft Estimate P: 1024).
Mission in London:
Grand total in FY 2015/2016 is 4.711.810 UGX (Draft Estimate P: 1028).
Mission in Ottowa:
Grand total in FY 2015/2016 is 4.948.238 UGX (Draft Estimate P: 1032).
Mission in New Dehli:
Grand total in FY 2015/2016 is 3.455.643 UGX (Draft Estimate P: 1036).
Mission in Cairo:
Grand total in FY 2015/2016 is 1.998.634 UGX (Draft Estimate P: 1040).
Mission in Nairobi:
Grand total in FY 2015/2016 is 4.259.503 UGX (Draft Estimate P: 1044).
Mission in Dar Es Salaam:
Grand total in FY 2015/2016 is 2.742.654 UGX (Draft Estimate P: 1048).
Mission in Abuja:
Grand total in FY 2015/2016 is 1.589.496 UGX (Draft Estimate P: 1052).
Mission in Pretoria:
Grand total in FY 2015/2016 is 2.732.934 UGX (Draft Estimate P: 1055).
Mission in Washington:
Grand total in FY 2015/2016 is 5.853.886 UGX (Draft Estimate P: 1059).
Mission in Adis Ababa:
Grand total in FY 2015/2016 is 2.346.789 UGX (Draft Estimate P: 1063).
Mission in Beijing:
Grand total in FY 2015/2016 is 3.673.069 UGX (Draft Estimate P: 1067).
Mission in Kigali:
Grand total in FY 2015/2016 is 2.112.602 UGX (Draft Estimate P: 1071).
Mission in Geneva:
Grand total in FY 2015/2016 is 5.362.895 UGX (Draft Estimate P: 1075).
Mission in Tokyo:
Grand total in FY 2015/2016 is 3.983.632 UGX (Draft Estimate P: 1079).
Mission in Tripoli:
Grand total in FY 2015/2016 is 1.899.252 UGX (Draft Estimate P: 1083).
Mission in Riyadh:
Grand total in FY 2015/2016 is 1.999.326 UGX (Draft Estimate P 1086).
Mission in Copenhagen:
Grand total in FY 2015/2016 is 3.487.953 UGX (Draft Estimate P: 1090).
Mission in Brussels:
Grand total in FY 2015/2016 is 4.834.260 UGX (Draft Estimate P: 1094).
Mission in Rome:
Grand total in FY 2015/2016 is 4.248.162 UGX (Draft Estimate P: 1098).
Mission in Kinshasa:
Grand total in FY 2015/2016 is 3.309.956 UGX (Draft Estimate P: 1102).
Mission in Khartoum:
Grand total in FY 2015/2016 is 2.264.481 UGX (Draft Estimate P: 1106).
Mission in Paris:
Grand total in FY 2015/2016 is 4.786.408 UGX (Draft Estimate P: 1110).
Mission in Berlin:
Grand total in FY 2015/2016 is 3.775.725 UGX (Draft Estimate P: 1114).
Mission in Tehran:
Grand total in FY 2015/2016 is 2.220.432 UGX (Draft Estimate P: 1118).
Mission in Moscow:
Grand total in FY 2015/2016 is 2.366.211 UGX (Draft Estimate P: 1122).
Mission in Canberra:
Grand total in FY 2015/2016 is 3.060.051 UGX (Draft Estimate P: 126).
Mission in Juba:
Grand total in FY 2015/2016 is 3.410.337 UGX (Draft Estimate P: 1130).
Mission in Abu Dhabi:
Grand total in FY 2015/2016 is 2.407.393 UGX (Draft Estimate P: 1134).
Mission in Bujumbura:
Grand total in FY 2015/2016 is 2.019.694 UGX (Draft Estimate P: 1138).
Consulate in Guangzhou:
Grand total in FY 2015/2016 is 5.135.304 UGX (Draft Estimate P: 1142).
Mission in Ankara:
Grand total in FY 2015/2016 is 2.770.166 UGX (Draft Estimate P: 1146).
Mission in Mogadishu:
Grand total in FY 2015/2016 is 2.770.881 UGX (Draft Estimate P: 1150).
Mission in Kuala Lumpur:
Grand total in FY 2015/2016 is 1.709.952 UGX (Draft Estimate P: 1154).
Mission in Mombasa:
Grand total in FY 2015/2016 is 821.446 UGX (Draft Estimate P: 1158).
Ministry of Justice and Constitutional Affairs:
First is the difference in ‘Legislation and Legal service’ between last year’s FY 2014/2015 2.934.969 UGX and this FY 2015/2016 is 6.519.956 UGX (Draft Estimate P: 118). Total to the Ministry is 57.324.370 UGX (Draft Estimate P: 133).
Ministry of Finance, Planning & Economic Development:
Macroeconomic Policy and Management was had budget for FY 2014/2015: 14.860.620 UGX and become 22.596.043 UGX in the FY 2015/2016 (Draft Estimate P: 135). Capitalisation of Institutions cost in FY 2014/2015 the amount of 65.802.344 UGX and in FY 2015/2016 becoming 266.602.344 UGX. The Belgo-Ugandan Study went from 3.167.890 UGX in FY 2014/2015 and comes to 10.237.890 UGX in FY 2015/2016. Development Budget where the Capitalisation and Belgo Uganda Study is a part of went from 86.650.930 UGX in FY 2014/2015 to 303.365.890 UGX in FY 2015/2016. Presidential Initiatives to Banana Industry was in FY 2014/2015: 2.974.000 UGX and in FY 2015/2016 is now 6.530.000 UGX (Draft Estimate P: 135). Financial Inclusion in Rural Areas (Profira) went from 1.542.229 UGX in FY 2014/2015 to 15.251.632 UGX in FY 2015/2016 (Draft Estimate P: 136). Contribution to Autonomous Institutions from 53.986.033 UGX in FY 2014/2015 to the next year FY 2015/2016 it becomes 278..719.671 UGX (Draft Estimate P: 135). This funds that goes to Contribution to Autonomous Institutions is going to certain institutions in FY 2015/2016. Here is how it’s shared: Uganda Development Bank: 10.000.000, African Development Bank: 4.000.000 UGX, PTA Banks: 4.800.000 UGX, Post Bank: 14.302.344 UGX, Islamic Development Bank 2.000.000 UGX, UN-DCF Symposium: 1.500.000 UGX and Re-Capitalization of BOU: 200.000.000 UGX (Draft Estimate P: 142). Capital Punishment was budgeted FY 2014/2015 to 2.974.000 UGX and in FY 2015/2016 is set to become 6.530.000 UGX this is because Other Structures will cost 4.000.000 UGX and didn’t spend on that last budget year (Draft Estimate P: 158). Uganda Free Zones or Total Program 18 was set to 14.009.556 UGX in FY 2014/2015 to become 17.177.409 UGX in FY 2015/2016 (Draft Estimate P: 159). African Development Fund was there 3.600.110 UGX into subscription in FY 2014/2015. And Outputs funded in FY 2015/2016 is the same 3.600.110 UGX (Draft Estimate P: 160). That same Output was set in FY 2014/2015, but nothing set for the FY 2015/2016, still it’ s put the same amount as last year with the same amount of cost. That doesn’t make sense.
The Grand total the MoFPED in FY 2014/2015 was 281.508.520 UGX and in the new FY 2015/2016 becoming 551.167.383 UGX (Draft Estimate P: 168).
Ministry of Internal Affairs:
Support of the Government Chemist was in FY 2014/2015 was set for 1.301.805 UGX and now in FY 2015/2016 became 3.331.805 UGX. It went up because this year Machinery and Equipment for 1.058.000 UGX compared to last FY (Draft Estimate P: 176).
Ministry of Agriculture, Animal & Fisheries:
Agriculture Supplies from the FY 2014/2015 budget for 7.981.942 UGX and for the FY 2015/2016 set to be 43.285.943 UGX (Draft Estimate P: 184). Transport equipment FY 2014/2015 set 2.400.000 UGX and in next year FY 2015/2016 is set to 4.166.500 UGX. Engineering and design studies & Plans for Capital in FY 2015/2016 set for 4.841.848 UGX. Northern Uganda Farmers Livelihood Improvement Project FY 2015/2016 set for 2.121.842 UGX. Farm-Based Bee Reserves Establishment Project started in the FY 2015/2016 to be 300.000 UGX. The Goat Export Project in Sembule District FY 2015/2016 set for 1.200.000 UGX. Livestock Diseases Control Project Phase 2 FY 2015/2016 set to be 7.855.600 UGX (Draft Estimate P: 203-205). Sustainable Fisheries Development Project FY 2015/2016 set to be 1.341.000 UGX (Draft Estimate P: 206). Water for Agriculture Production FY 2015/2016 is 2.588.320 UGX (Draft Estimate P: 209). MAAIF Coordination/U Growth FY 2014/2015 was set 2.417.000 UGX in FY 2015/2016 set to be 27.217.803 UGX (Draft Estimate P: 214). The Project on Irrigation Scheme Development in Central and Eastern Uganda (PISD)-JI in FY 2015/2016 is set to 5.319.848 UGX. National Farmers Leadership Center (NFLC) FY 2015/2016 is set to 800.000 UGX (Draft Estimate P: 215).
Total budget for the Ministry of Agriculture was in the FY 2014/2015: 84.075.417 UGX and FY 2015/2016: 142.530.281 UGX (Draft Estimate P: 217).
National Environment Management Authority:
Grand total for FY 2015/2016 is 9.147.189 UGX (Draft Estimate P: 871).
National Agricultural Research Organization:
NARO Internal Audit budgeted for FY 2015/2016 is 82.500 UGX. National Coffee Research Institute for FY 2015/2016 is 219.156 UGX (Draft Estimate P: 796). National Crops Research gets for FY 2015/2016 is 670.049 UGX (Draft Estimate P: 800). National Fisheries Research gets for FY 2015/2016 is 589.512 UGX. National Forestry Research gets for FY 2015/2016 is 439.458 UGX (Draft Estimate P: 801). National Livestock Research gets for FY 2015/2016 is 311.856 UGX (Draft Estimate P: 802). National Coffee Research Institute gets for FY 2015/2016 is 219.156 UGX (Draft Estimate P: 813).
Grand total for NARO for FY 2015/2016 is 98.983.410 UGX (Draft Estimate P: 817).
National Animal Genetic Resources Centre and Data Bank:
Grand total for FY 2015/2016 is 4.450.000 UGX (Draft Estimate P: 706).
Dairy Development Authority:
Grand total for FY 2015/2016 is 5.044.202 UGX (Draft Estimate P: 650).
Uganda Coffee Development Authority:
Workshops and Seminars for FY 2014/2015 is 988.640 UGX (Draft Estimate P: 920). Medical and Agricultural supplies for FY 2014/2015 is 28.352.628 UGX (Draft Estimate P: 921). Grand total for FY 2014/2015 is 43.792.300 UGX (Draft Estimate P: 919).
Uganda Cotton Development Organization:
Cotton Production Improvement for FY 2015/2016 is 3.911.000 UGX. Grand total for FY 2015/2016 is 7.786.481 UGX (Draft Estimate P: 897).
Ministry of Local Government:
District Administration and Development FY 2014/2015 the GoU is 8.857.525 UGX and External Finance 186.249.482 UGX totally for the FY 2014/2015 was 195.107.007 UGX. On the FY 2015/2016 GoU is 8.275.525 UGX and External Finance 80.987.122 UGX. Totally FY 2015/2016 is now 89.262.647 UGX. The External Finance from last budget year went down totally of 96.986.835 UGX. Which is significant And the total budget cuts is 105.844.360 UGX (Draft Estimate P: 219). Easy see that the External Finance is the reason why the cuts have happen.
Markets and Agriculture Trade Improvement Project is FY 2014/2015 was 31.949.871 UGX. Had External Finance 29.879.482 UGX and GoU 2.070.389 UGX. The next FY 2015/2016 put the GoU funding 1.000.000 UGX and External Finance 2.757.122 UGX and the total budget FY 2015/2016 was set 3.757.122 UGX. Total budget difference from FY 2014/2015 to FY 2015/2016 is 28.192.749 UGX (Draft Estimate P: 224).
Markets and Agricultural Trade Improvements Programme (MATIP 2) for the FY 2014/2015 was given from GoU 8.857.525 UGX + External Finance 186.249.482 UGX. Total for last budget year 195.107.007 UGX. FY 2015/2016 from GoU is 8.275.525 + External Finance 80.987.12. Total is 89.262.647 UGX (Draft Estimate P: 225). Difference between FY 2014/2015 versus 2015/2016 is 105.844.360 UGX in cuts and it’s because of less External Finances from the year before.
Total to Ministry of Local Government:
FY 2014/2015 the GoU 32.091482 UGX + External Finance 191.619.482 the total for the year is 223.710.964 UGX (Draft Estimate P: 232).
FY 2015/2016 the GoU 31.135.358 UGX + Eternal Finance 84.91712 the total for the year is 116.052.449 UGX (Draft Estimate P: 232).
Local Government Finance Commission:
Grand total for FY 2015/2016 is 5.083.375 UGX (Draft Estimate P: 854).
Ministry of Lands, Housing and Urban Development:
Albertine Region Sustainable Development Project for the FY 2015/2016 set for 6.767.783 which is external finance (Draft Estimate P: 234). Competitiveness and Enterprise Development Project [CEDP] last FY 2014/2015 totally GoU funding which was 8.884.098 UGX. In FY 2015/2016 the GoU where 8.814.098 UGX with the Eternal Finance was set to 10.280.000 which is totally of 19.094.098 UGX, the difference between the years is the 10.000.000 in External Finance (Draft Estimate P: 241). Capital Purchases from the Ministry for infrastructure projects is set for 6.767.783 UGX (Draft Estimate P: 246).
Total budget for the ministry was FY 2014/2015 set for 30.214.981 UGX and for FY 2015/2016 is now 41.950.419 UGX (Draft Estimate P: 253).
Ministry of Education and Sports:
Uganda Teacher and School Effectiveness Project for FY 2014/2015 were given 8.061.000 UGX and FY 2015/2016 is set 90.395.134 UGX. And the External Finance for the project in the FY 2015/2016 is 88.355.134 UGX and was in FY 8.061.000 (Draft Estimate P: 255). So there is big difference between the budget years. Emergency Construction of Primary Schools Phase II FY 2015/2016 set for 1.864.900 UGX. Albertine Region Sustainable Development Project was in the budget for FY 2014/2015 we’re 650.000 UGX and in FY 2015/2016 become 12.187.015 UGX. Skills Development Project for FY 2015/2016 is 19.930.030 UGX. Development of PTCs Phase II comes in the FY 2015/2016 is 5.377.824 UGX. Akii Bua Olympic Stadium get in the FY 2015/2016 is 1.000.000 UGX. National High Altitude Training Centre (NHATC) get in the FY 2015/2016 is 5.829.800 UGX (Draft Estimate P: 256).
Total budget for the Ministry was FY 2014/2015 set for 415.057.518 UGX and for FY 2015/2016 is now 400.556.219 UGX (Draft Estimate P: 283).
Education Service Commission:
Grand total for FY 2015/2016 is 5.789.344 UGX (Draft Estimate P: 741).
Grand total for FY 2015/2016 is 21.337.135 UGX (Draft Estimate P: 583).
Grand Total for FY 2015/306 is set 10.148.045 UGX (Draft Estimate P: 715).
Project 1250 Support to Innovation – EV Car Project for FY 2015/2016 is 8.220.610 UGX (Draft Estimate P: 762). Project 1343 SPEDA II cost in FY 2015/2016 is 1.058.000 UGX. Grand Total for FY 2014/2015 is 201.606.596 UGX (Draft Estimate P: 765).
Makerere University Business School:
Grand Total for FY 2015/2016 is 49.652.302 UGX (Draft Estimate P: 777).
Grand total for FY 2015/2016 is 49.652.302 UGX (Draft Estimate P: 774).
Grand total for FY 2015/2016 is 73.828.998 UGX (Draft Estimate P: 783).
Grand total for FY 2015/2016 is 26.718.718 UGX (Draft Estimate P: 864).
Ministry of Health:
A part of ‘Clinical and Public Health’ has located to the Shared National Services get 6.930.000 UGX for FY 2015/2016 (Draft Estimate P: 285).
Total to the Ministry is was FY 2014/2015 set for 581.740.966 UGX and for FY 2015/2016 is now 521.632.572 UGX (Draft Estimate P: 304). External Project Financing for the ministry was for FY 2015/2016 is 444.021.970 UGX (Draft Estimate P: 305).
Mulago Hospital Complex:
Management – Incapacity, death benefits and funeral expence: For FY 2015/2016 is 600.00. Staff training for the FY 2015/2016 is 486.656 UGX (Draft Estimate P: 926).
Grand total for FY 2015/2016 is 53.809.703 (Draft Estimate P: 924).
Grand total for FY 2015/2016 is 9.702.815 UGX (Draft Estimate P: 929).
Arua Referral Hospital:
Grand total for FY 2015/2016 is 5.167.001 UGX (Draft Estimate P: 935).
Fort Portal Referral Hospital:
Grand total for FY 2015/2016 is 5.787.777 UGX (Draft Estimate P: 942).
Gulu Referral Hospital:
Grand total for FY 2015/2016 is 6.095.645 UGX (Draft Estimate P: 949).
Hoima Referral Hospital:
Grand total for FY 2015/2016 is 4.906.560 UGX (Draft Estimate P: 955).
Jinja Referral Hospital:
Grand total for FY 2015/2016 is 5.995.690 UGX (Draft Estimate P: 962).
Kabale Referral Hospital:
Grand total for FY 2015/2016 is 4.477.995 UGX (Draft Estimate P: 969).
Masaka Referral Hospital:
Grand total for FY 2015/2016 is 5.359.433 UGX (Draft Estimate P: 976).
Mbale Referral Hospital:
Grand total for FY 2015/2016 is 6.723.347 UGX (Draft Estimate P: 982).
Soroti Referral Hospital:
Grand total for FY 2015/2016 is 4.869.977 UGX (Draft Estimate P: 988).
Lira Referral Hospital:
Grand total for FY 2015/2016 is 4.344.172 UGX (Draft Estimate P: 996).
Mbarara Referral Hospital:
Grand total for FY 2015/2016 is 6.779.132 UGX (Draft Estimate P: 1002).
Mubende Referral Hospital:
Grand total for FY 2015/2016 is 4.756.488 UGX (Draft Estimate P: 1008).
Moroto Referral Hospital:
Grand total for FY 2015/2016 is 3.214.118 UGX (Draft Estimate P: 1013).
Naguru Referral Hospital:
Grand total for FY 2015/2016 is 5.800.972 UGX (Draft Estimate P: 1019).
Uganda Blood Transfusion Service:
Safe Blood Provision for FY 2015/2016 is 2.517.065 UGX (Draft Estimate P: 878). Regional Blood Banks for FY 2015/2016 is 5.432.786 UGX (Draft Estimate P: 879). Grand total for FY 2015/2016 is 8.414.084 UGX (Draft Estimate P: 876).
Uganda AIDS Commission:
Grand total for FY 2015/2016 is 7.747.968 UGX (Draft Estimate P: 563).
Uganda Cancer Institute:
Grand total for FY 2015/2016 is 17.040.925 UGX (Draft Estimate P: 614). External funding from ADB to UCI which is 3.329.460 (Draft Estimate P: 620).
Uganda Heart Institute:
Grand total FY 2015/2016 is 14.282.367 UGX (Draft Estimate P: 621).
National Medical Stores:
Grand total FY 2015/2016 is 218.614.467 UGX (Draft Estimate P: 626).
Health Service Commission:
Grand total for FY 2015/2016 is 4.169.557 UGX (Draft Estimate P: 753).
Ministry for Trade, Industry and Cooperatives:
Soroti Fruit Factory in the FY 2014/2015 was 4.846.906 UGX and in FY 2015/2016 set to10.482.787 UGX (Draft Estimate P: 306).
Grand Total for the Ministry in FY 2014/2015 was 19.450.781 UGX and in FY 2015/2016 set to 25.594.837 UGX (Draft Estimate P: 322).
Uganda Land Commission:
Grand total for FY 2015/2016 is 15.697.657 UGX (Draft Estimate P: 902).
Ministry of Works and Transport:
Entebbe Airport Rehabilitation Phase 1 FY 2015/2016 is 252.875.768 UGX (Draft Estimate P: 324). Earth Moving Equipment Japan for FY 2015/2016 is set for 479.281.115 UGX, the GoU has 69.999.740 UGX the rest was 409.281.375 UGX (Draft Estimate P: 325). Transfers to other govt. Units (Capital) – FY 2015/2016 is 261.745.768 UGX, GoU are 8.870.000 UGX and the rest External Finance 252.875.768 UGX. Investmnt (Captial Purchase) – Machinery and equipment: FY 2015/2016 is set for 483.631.055 UGX. GoU is 73.349.680 and External Financing is 409.281.375 UGX (Draft Estimate P: 327). East African Trade and Transportation Facilitation – Construction/Rehabilitation of Railway Infrastructure – Other Structures: FY 2014/2015 we’re 7.000.000 UGX and in FY 2015/2016 is 450.000 UGX (Draft Estimate P: 333). New Ferry to replace Kabalega – Opening South both years FY 2014/2015 and FY 2015/2016 totally for both years 2.000.000 UGX (Draft Estimate P: 334). New Standard Gauge Railway Line the budget for FY 2014/2015 was 5.620.000 UGX and in FY 2015/2016 it’s now 3.500.000 UGX (Draft Estimate P: 335). Capacity Enhancement of KCCA in Management of Traffic in the FY 2015/2016 is 1.970.000 UGX. Entebbe Airport Rehabilitation Phase 1 in the FY 2015/2016 is 252.875.768 UGX (Draft Estimate P: 336). Master Plan on Logistics in Northern Economic Corridor in the FY 2015/2016 is 3.290.000 UGX. Gulu Municipal Council Roads (Preparatory Survey) in the FY 2015/2016 is 1.090.000 UGX (Draft Estimate P: 337). Redevelopment of State House at Entebbe in the FY 2015/2016 is 1.500.000 UGX (Draft Estimate P: 342).
The ministry grand total was FY 2014/2015 is 122.364.181 UGX and in FY 2015/2016 is 837.629.393 UGX (Draft Estimate P: 357).
Uganda National Roads Authority:
Construction of RD Agency HQs budgeted to 10.000.000 UGX is FY 2015/2016. Design Kyenjojo-Hoima-Masindi-Kigumba (238km) was budget in FY 2014/2015 was 65.000.000 UGX and it was FY 2015/2016 is 104.400.000 UGX. Kampala Entebbe Express Highway was set for FY 2014/2015 was 130.000.000 UGX to FY 2015/2016 is 233.140.000 UGX. Kampala Flyover for FY 2015/2016 is 19.630.000 UGX. Construction of 66 Selected Bridges for FY 2015/2016 is 10.871.944 UGX. Upgrading of Muyembe-Nakapiripirit (92 km) for FY 2015/2016 is 22.600.000 UGX. Total Development Budget for the UNRA is for FY 2015/2016 is 1.725.000.114 UGX (Draft Estimate P: 595). Grand total for FY 2015/2016 is 1.761.658.654 UGX (Draft Estimate P: 611).
Financial from External support for some of the Projects of UNRA:
Design for the New Nile Bridge at Jinja is supported from Japan. Design Kyenjojo-Hoima-Masindi-Kigumba (238km), Upgrading Rukungiri-Kihihi-Ishasha/Kanungu Road and Upgrading Mbale-Bubulo-Lwakhakha Road is financed from the African Development Bank. Kampala Flyover is supported from Japan (Draft Estimate P: 613).
Grand total for FY 2015/2016 is 428.101.919 UGX (Draft Estimate P: 634).
Ministry of Energy and Mineral Development:
Kampala-Entebbe Expansion Project was in FY 2014/2015 is 4.920.000 UGX and in FY 2015/2016 is 53.493.000 UGX. Large Hydro power infrastructure FY 2015/2016 is 2.314.840.000 UGX. The Hydro power projects are: Isimba HPP, Karuma Hydroelectricity Power Project, Muzizi Hydro Power Project and Nyagak III Hydro Power Project (Draft Estimate P: 359). Strengthening the Development and Production Phases of Oil and Gas Sector is set for budget FY 2015/2016 are 63.145.000 UGX (Draft Estimate P: 402).
Isimba HPP and Karuma Hydroelectricity Power Project is Financed from China. The Kampala-Entebbe Expansion Project is financed Germany Federation Republic. The Muzizi Hydro Power Project was financed from France. Development and Production Phases of Oil and Gas Sector are financed through Norway (Draft Estimate P: 402).
The ministry grand total was FY 2014/2015 is 1.775.909.953 UGX and in FY 2015/2016 is 2.723.629.310 UGX (Draft Estimate P: 401).
Uganda Industrial Research Institute:
Grand total for FY 2015/2016 is 14.340.221 UGX (Draft Estimate P: 578).
Rural Electrification Agency:
Grand total for FY 2015/2016 is 91.107.608 UGX (Draft Estimate P: 690). Energy for Rural Transformation (ERT) II- Rural Electrification for FY 2015/2016 is 10.944.108 UGX (Draft Estimate P: 693).
Ministry of Gender, Labour and Social Development:
Uganda Women Entrepreneurs Fund (UWEP) funded through the GoU for the FY 2015/2016 is 1.000.000 UGX. Youth Livelihood Programme (YLP) for the budget FY 2015/2016 is set for 33.000.000 UGX (Draft Estimate P: 403). Social Assistance Grant for Empowerment – Sector Institutions and Implementing Partners Supported – SAGE beneficiaries: FY 2015/2016 set to 6.800.746 UGX. Youth Livelihood Programme (YLP) we’re set budget for FY 2015/2016 is 33.000.000 UGX (Draft Estimate P: 418). Sector Institutions and Implementing Partners Supported – o/w transfers to LGs and KCCA for youth projects FY 2015/2016 is set 27.915.180 UGX (Draft Estimate P: 417).
Grand total for the Ministry was for FY 2014/2015 we’re 62.792.359 UGX and in FY 2015/2016 is now 70.398.881 UGX (Draft Estimate P: 420).
Equal Opportunity Commission:
Grand total for FY 2015/2016 is 4.450.000 UGX (Draft Estimate P: 701).
Uganda Human Rights Commission:
Grand total for FY 2015/2016 is 11.700.407 UGX (Draft Estimate P: 559).
Ethics and Integrity:
Grand total for FY 2015/2016 is 5.429.296 UGX (Draft Estimate P: 590).
Ministry of Water and Environment:
Support to RWS Project: FY 2014/2015 was set to 29.997.000 UGX and the next budget year FY 2015/2016 is 45.097.000 UGX. Piped Water in Rural Areas: FY 2015/2016 set to 16.675.333 UGX. Urban Water Supply & Sewerage was set for FY 2014/2015: 409.007 UGX and in FY 2015/2016 it is 3.389.007 UGX. Protection of Lake Victoria-Kampala Sanitation Program is set 39.013.434 UGX in FY 2014/2015 and in FY 2015/2016 is set 70.629.000 UGX. Kampala Water Lake Victoria Water and Sanitation Program were set to be 17.899.244 UGX in FY 2014/2015 and in FY 2015/2016 is set 47.930.965 UGX (Draft Estimate P: 421). Lake Victoria Environment Management Project was set 10.821.000 UGX for FY 2014/2015 and in the FY 2015/2016 is 25.257.000 UGX. Water Management and Development Project is set to 2.718.539 UGX in FY 2014/2015 and now in FY 2015/2016 is 5.617.000 UGX. Uganda National Meteorological Authority (UNMA) budget for 2015/2016 set for 12.661.000 UGX (Draft Estimate P: 422)
Grand total for the ministry is the 340.742.483 UGX in FY 2014/2015 and in FY 2015/2016 is set to be totally 436.164.599 UGX.
National Forestry Authority:
Support to National Forestry Authority – Agricultural Supplies in the FY 2015/2016 is 1.919.085 UGX (Draft Estimate P: 912). Grand total for FY 2015/2016 is 23.264.295 UGX (Draft Estimate P: 908).
Ministry of Information and Communication Technology:
Grand total to the ministry in FY 2015/2016 is set to be 11.215.240 UGX (Draft Estimate P: 496).
National Information Technology Authority:
Project 1014 National Transmission Backbone project: FY 2015/2016 set for 5.050.058 UGX
(Draft Estimate P: 711). Grand total for NITA for FY 2015/2016 is set for 39.200.998 UGX (Draft Estimate P: 714).
Ministry of Tourism, Wildlife and Antiques:
Establishment of Regional Satelite Wildlife Conservation in FY 2015/2016 is set 5.040.000 UGX (Draft Estimate P: 506). Mt. Rwenzori Tourism Infrastructure Development Project (MRTIDP) in FY 2015/2016 is set to 864.027 UGX. Development of Museums and Heritage Sites for Cultural Promotion in FY 2015/2016 is set to 686.000 UGX. Establishment of Lake Victoria Tourism Circuit in FY 2015/2016 is set 300.000 UGX (Draft Estimate P: 513). Development of Source of the Nile in FY 2015/2016 is set to 680.000 UGX (Draft Estimate P: 514). Grand total to the ministry for FY 2015/2016 is 17.837.396 UGX (Draft Estimate P: 517).
Uganda Tourist Board:
Grand total FY 2015/2016 is 11.403.457 UGX (Draft Estimate P: 629). Advertising and PR from FY 2014/2015 was 1.287.601 UGX to FY 2015/2016 is 4.188.280 UGX (Draft Estimate P: 630).
Grand total to FY 2015/2016 in 92.979.388 UGX (Draft Estimate P: 525).
Institutions and Government organization on the Budgets:
Printing, Stationery, Photocopying and Binding in FY 2015/2016 is set to 105.686.649 UGX. Capital Purchases in Machinery and Equipment in FY 2015/2016 is set to 30.000.000 UGX (Draft Estimate P: 528). Management of Election in FY 2015/2016 is set 234.967.009 UGX and in FY 2014/2015 is set 141.688.692 UGX (Draft Estimate P: 530). Grand total to the Electoral Commission for the FY 2015/2016 is set to be 265.580.684 UGX and in FY 2014/2015 it was 150.580.684 UGX (Draft Estimate P: 531).
Inspectorate of Government (IG):
Grand total budget to FY 2015/2016 is set to 37.720.116 UGX (Draft Estimate P: 538).
In the FY 2015/2016 the MPS are budgeted 201.164.917 UGX (Draft Estimate P: 540). Contribution to other Organizations – Gov’t Contribution to EALA- Arusha set for FY 2015/2016 is set 7.257.179 UGX (Draft Estimate P: 542). Administration and Transport Logistics set for 2015/2016 is set 2.905.774 (Draft Estimate P: 551). Grand total to the Parliamentary Commission for the FY 2015/2016 is 301.697.537 UGX (Draft Estimate P: 552).
Law Reform Commission:
Grand total for the FY 2015/2016 is 8.920.536 UGX (Draft Estimate P: 553). The biggest expense from last FY 2014/2015 was 290.405 UGX and in FY 2015/2016 is 1.191.699 UGX (Draft Estimate P: 553-554).
National Planning Authority:
Grand total for FY 2015/2016 is 14.613.907 UGX (Draft Estimate P: 567).
Law Development Center:
Grand total for FY 2015/2016 is 10.110.804 UGX (Draft Estimate P: 572).
Uganda Registration Service Bureau:
Grand total for FY 2015/2016 is 13.715.034 UGX (Draft Estimate P: 638). Up from last FY 2015/2016 on the ‘Rent – (Produced Assets) to private entities’ is 1.702.400 UGX (Draft Estimate P: 639).
National Citizenship and Immigration Control:
Grand total for FY 2015/2016 is 139.589.276 UGX (Draft Estimate P: 643). The biggest post was Capital Punishment – Machinery and equipment which is 76.396.918 UGX in this FY (Draft Estimate P: 644).
Kampala Capital City Authority:
2ND Kampala Institutional and Infrastructure Development Project FY 2015/2016 is 82.151.560 UGX (Draft Estimate P: 661). Urban Road Network Development total for the FY 2015/2016 is 139.204.569 UGX (Draft Estimate P: 661). Education and Social Service for FY 2015/2016 is 36.155.136 UGX (Draft Estimate P: 666). Community Health Management for FY 2015/2016 is 9.718.674 UGX (Draft Estimate P: 674). Sanitation and Environmental Services for FY 2015/206 is 13.578.579 UXG (Draft Estimate P: 675). Gender, Community and Economic Development for FY 2015/2016 is 2.368.822 UGX (Draft Estimate P: 678). Economic Policy Monitoring,Evaluation & Inspection for FY 2015/2016 is 104.749.162 UGX (Draft Estimate P: 681).
Uganda National Examination Board:
Grand total for 2015/2016 is 69.869.913 UGX (Draft Estimate P: 722).
One major reason why the budget was different between years is that 250.000.000 UGX was given to ‘Contribution to Autonomous Institutions’ (CAI) (Draft Estimate P: 728). Grand total between the FY was in 2014/2015 was 1.222.034.703 UGX and in 2015/2016 is 2.088.896.738 UGX. Which is total difference: 866.862.035 UGX, parts of this the CAI (Draft Estimate P: 731).
Programme 05 Directorate of Value for Money and Specialised Audits for FY 2015/2016 is 4.507.922 UGX (Draft Estimate P: 736). Grand total for the Auditor General for FY 2015/2016 is 46.818.861 UGX (Draft Estimate P: 737).
Directorate of Public Prosecution:
Grand total for FY 2015/2016 is 27.934.069 UGX (Draft Estimate P: 748).
Uganda Management Institute:
Grand total for FY 2015/2016 is 22.763.029 UGX (Draft Estimate P: 784).
Uganda Revenue Authority:
Grand total for FY 2015/2016 is 238.534.130 UGX (Draft Estimate P: 788).
Uganda Bureau of Statistics:
Grand total for UBOS in FY 2015/2016 is 65.543.461 UGX (Draft Estimate P: 827).
Public Service Commission:
Grand total for FY 2015/2016 is 4.997.601 UGX (Draft Estimate P: 849).
Judicial Service Commission:
Grand total for FY 2015/2016 is 3.209.142 UGX (Draft Estimate P: 859).
Government Purchases for FY 2015/2016 is 177.704.389 UGX. Grand total for FY 2015/2016 is 183.974.681 UGX (Draft Estimate P: 881).
Public Procurement and Disposal of Public Assets Authority (PPDA):
Grand total for FY 2015/2016 is 10.722.548 UGX (Draft Estimate P: 887).
Uganda National Bureau of Standards:
Grand total for FY 2015/2016 is 20.728.194 UGX (Draft Estimate P: 892).
Annex 2B: Allocation of Additional resources FY 2015/2016
Republic of Uganda – DRAFT ESTIMATES OF REVENUE AND EXPENDITURE (RECURRENT AND DEVELOPMENT) – FY 2015/2016 – VOLUME I: CENTRAL GOVERNMENT VOTES – FOR THE YEAR ENDING ON THE 30TH JUNE 2016
Now I will go through how the IMF is describing the economic situation in Uganda. It will have similarities with the budget of 2015/2016. Seem like the Ministry of Finance in Uganda. The numbers and fiscal standards are exactly the same. Still I think it will good to see and give what the Western Hemisphere and the monetary organ is saying about the economy of Uganda. So that people can see the similarities and also the difference quotes from the situation.
Min Zhu the Deputy Managing Director and Acting Chair in the IMF commented on Uganda in this way:
“The economic policy mix is expected to remain focused on attaining growth and inflation Objectives” (…) “The Bank of Uganda is encouraged to remain firmly focused on the maintenance of price stability” (…) “Enacting regulations to implement the new PFM Act and a charter of fiscal responsibility, and improving cash management are critical remaining reforms. Amending the Bank of Uganda Act and enacting financial institutions legislation are key steps to further enhance central bank independence and strengthen financial resilience”.
The Executive board:
“Uganda’s recent economic performance has been favorable. Real GDP growth is projected at 5¼ percent for FY2014/15 supported by a fiscal stimulus and a recovery in Private Consumption” (…) “Economic policies in FY2014/15 have supported growth and stability objectives. The fiscal deficit is estimated at 4½ percent of GDP, below previous projections, on account of a sharp tax revenue increase” (…) “The outlook is promising. Growth is estimated at 5¾ percent in FY2015/16 and an average 6¼ percent over the medium-term, driven by scaled-up public investment and a rebound in private demand”.
The Executive Board Assessment:
“Directors stressed the need for continued fiscal discipline in the pre-electoral environment, and recommended strengthened communication with the markets” (…) “Directors welcomed the adoption of the Public Financial Management Act, and advised prompt enactment of its regulations”.
Staff report from the 12th June 2015:
“Security concerns following unrest in neighboring countries and terrorist attacks in the region have weighed on Uganda’s spending needs, exports, and remittances. Declining donor support in reaction to concerns about governance and human rights and reduced development partners’ aid budgets have spurred domestic borrowing requirements” (…) “During a period of moderate growth, inflation has come down significantly from its 33 percent peak in 2011; and despite a decline in international reserves and a pickup in public debt, both remain at comfortable levels” (…) “The reduction in the stock of domestic arrears was smaller than targeted reflecting a decision to backload intra-year repayments, but the annual target is expected to be met. Contracting of nonconcessional borrowing (NCB) for hydropower plants (HPPs), roads, and electrification was within the $2.2 billion limit. Most end-March ITs were met” (…) “The approval of the Public Financial Management (PFM) Act in November 2014 was a major milestone, and structural benchmarks on finalizing preparation on its regulations and the Charter of Fiscal Responsibility (CFR) were observed. The Treasury Single Account (TSA) set-up has laid the stage for improved cash management although more time will be needed to eliminate movements of cash and incorporate donor accounts in the system. The submission to parliament of amendments to the Bank of Uganda (BoU) Act was postponed” (…) “the government has started the implementation of an ambitious investment package aimed at narrowing the infrastructure gap, enhancing regional integration, and preparing for oil production”.
“real GDP growth was 4½ percent in FY2013/14, driven by services, trade, construction, and manufacturing—below the estimated potential of about 6 percent” (…) “The nominal exchange rate against the US dollar appreciated by 7 percent in the year through February 2014, and since then depreciated by 20-25 percent” (…) “The real effective exchange rate appreciated by about 4 percent in 2014, mainly reflecting the weakening of Uganda’s main trading partners’ currencies” (…) “Annual core inflation fell to 2.7 percent in December 2014 and rebounded to 4.8 percent in May 2015” (…) “GDP was revised upwards by 17¼ percent in FY2009/10, the base year. The services sector and to a lesser extent the agricultural sector increased their share in GDP, while the share of industry and construction declined” (…) “Short-term benefits of the oil price decline have been less pronounced in Uganda than in other countries in the region. In the past nine months, petrol average pump prices have declined by 10 percent in domestic currency” (…) “Oil investments might be delayed in the context of lower profitability. Moreover, many interrelated investment decisions are dependent on the oil price, including granting production licenses; signing commercial and financial arrangements; developing engineering, procurement and construction plans; and agreeing on transnational infrastructure works” (…) “The current account deficit remained large owing to structurally high trade deficits. Imports of capital goods and petroleum products are increasing, while both coffee and non-coffee exports have stagnated since mid-2013 reflecting depressed food exports to South Sudan” (…) “The monetary policy transmission asymmetry is explained by the banks’ cautious focus on loan recovery and their high operating costs, coupled with some crowding out effects as government’s domestic borrowing requirements increased at that time” (…) “The number of commercial banks has increased from 14 to 25 with a large influx of foreign banks, which currently hold 80 percent of assets” (…) “the BoU kept a tight policy stance, holding the CBR constant at 11 percent from June 2014 to April 2015, and then raising it to 12 percent, on account of global developments and the ongoing and expected exchange rate pass-through. The BoU’s intervention in the foreign exchange market has been focused on its program of announced dollar purchases for reserve build-up, but in the last few months it has been intervening on the sale side to smooth the fast-paced shilling depreciation. This intervention, along with increased infrastructure-related government imports, drove reserves down from $3.2 billion in end-December to $2.9 billion in mid-May (about 4 months of imports)”.
Economic Outlooks and Risks:
“Public investment financing, alongside weaker exports and tourism receipts, will drive the current account deficit up while preserving reserves at 4 months of imports” (…) “Low consumer prices—with average core inflation projected to remain within the PSI consultation inner band at 3½ and 6¼ percent for end FY2014/15 and FY2015/16″ (…) “Slower growth in key trading partners and further spillovers from lower global liquidity could trigger capital outflows, squeezing liquidity and generating currency mismatches for banks and corporations. In the medium term, the complex commercial and legal aspects surrounding FDI in the oil sector could delay the planned investments”.
Supporting Medium-Term Growth:
“The latter has been at the center of the authorities’ economic agenda as infrastructure investments of around $11 billion—including PPPs—are expected over the next ten years” (…) “With recoverable crude oil reserves of 1.7 billion barrels out of potential reserves of 6.5 billion, oil production would start in FY2020/21 under a model that entails a crude export pipeline and a domestic refinery” (…) “Uganda ratified the Monetary Union Protocol, and has been actively participating in work to establish EAC regional institutions and to create a fiscal surveillance process” (…) “the Uganda Revenue Authority (URA) to improve enforcement and compliance, but a sustained increase in the ratio will require incorporating the large informal sector into the tax-paying portion of the economy and ensuring that large taxpayers comply with their obligations” (…) “Sustainable financial deepening will largely rely on making steady progress on financial inclusion, which will in turn depend on actions to boost the bank deposit base; enhance the intermediation role of non-bank financial institutions, including the National Social Security Fund (NSSF); and develop the money and capital markets” (…) “Staff’s debt sustainability analysis, which includes the infrastructure package as a whole, concludes that the public and publicly guaranteed external debt-to-GDP ratio in net present value (NPV) terms would peak at about 25 percent in FY2020/21. Even combined with domestic borrowing plans, total public debt would remain well below the benchmark associated with heightened vulnerabilities” (…) “The tax-to-GDP ratio in Uganda was one of the lowest in the region prior to the GDP rebasing and is definitely the lowest afterward. Over the past ten years the ratio only increased by 0.2 percentage points per year, on average” (…) “Planned improvements include URA’s efforts to assess income from rental properties and identify businesses that are accessing local services but not filing national tax returns. Use of enhanced controls and creation of a single central processing center for all customs clearances should boost customs revenue” (…) “EAC convergence criteria, Uganda has targeted a tax-to-GDP ratio of 25 percent by 2021”(…) “Social protection in Uganda is entrenched in the Constitution, Vision 2040 and the NDP II. Interventions have nonetheless been limited and fragmented—with only 0.4 percent of GDP a year devoted to direct income support and 1.2 percent of GDP to total social protection”.
Maintaining Fiscal restraint while raising Public Investment:
“The overall deficit increased by 2 percent of GDP between FY2011/12 and FY2014/15” (…) “The overall deficit is projected to increase by an additional 2½ percentage points by FY2017/18 fueled by a continued expansion in capital spending (3¾ percentage points) and a small increase in current spending (¼ percentage point), and curtailed by a further improvement in revenues of at least ½ percent of GDP each year” (…) “the supplementary budget used part of the windfall revenue and expenditure savings to cover operational shortfalls at several ministries, and Electoral Commission outlays, among other pressing needs. All in all, the overall fiscal deficit is now projected to reach 4½ percent of GDP (6¾ percent in the program) and issuances of securities in the domestic market should remain within the target” (…) “The FY2015/16 budget will increase the overall fiscal deficit to 7 percent of GDP largely financed by NCB on favorable terms” (…) “The contingency provision was reduced by 0.2 percent of GDP at the time of budget approval to facilitate one-off spending on police activities linked to the election and allowances to parliamentarians, leaving little budget flexibility and requiring prudent execution in the year ahead”.
Protecting the Inflation objective:
“Some challenges remain, including insufficient institutional arrangements to prevent government’s use of deposits in BoU accounts beyond agreed levels, and shortcomings in inflation forecasting capabilities and fiscal-monetary policy coordination” (…) “Given the high share of imported goods in the CPI, import prices play a key role in inflation behavior, with an estimated pass-through factor of 0.4–0.5” (…) “The BoU has taken steps to reduce volatility in overnight market rates by allowing all banks (previously only primary dealers) to access BoU operations”.
Securing a more effective contribution of the Financial Sector to Growth:
“The BoU does not stress test banks’ resilience to lending rate hikes because of insufficient data availability” (…) “High dollarization. 37 percent of deposits and 43 percent of loans are denominated in foreign currency” (…) “banks’ business models, with a large share of assets devoted to investments in Treasury bills, reflect cautious risk taking, as well as curtailed policy predictability given the large swings in interest rates, thus jeopardizing credit growth”.
Building Institution and improving the Business Environment:
“Core fiscal targets: These targets are based on the EAC convergence criteria, and consist of an overall deficit target of 3 percent of GDP by FY2020/21 and an annual debt ceiling of 50 percent of GDP in NPV terms”.
“That fiscal policy decisions will be strictly aligned to the budget is essential to influencing banks’, corporations’, and households’ behavior. Even more critical, however, is that policy implementation adheres to the budget to build a track record of fiscal discipline during pre-electoral periods and preserve the economic objectives”.
Can you believe it and how the inflation numbers together with the borrowing are not totally the same, that is for the reason that the Budget Deficit has been set by the government of Uganda is on the size of the yearly budget instead of the GDP as the IMF they set it there, the number will significant better and also smaller. Still, the Yearly Review which was ‘Value for Money’ told the same, even if the number will be different next year from URA and Ministry of Finance, Planning and Economic Development (MoFPED) will hopefully drop similar numbers next time. Since the numbers for deficit are going up and also the loans because of missing donor money. While waiting for the money from the Oil Development. Still, wait for how the budget year 2015/2016 will go. Peace.
How the Implementation of the IMF Policy Support is going:
Letter from the Ministry of Finance, Planning and Economic Development (MoFPED) to the IMF:
International Monetary Fund – IMF Country Report No. 15/175: STAFF REPORT FOR THE 2015 ARTICLE IV CONSULTATION AND FOURTH REVIEW UNDER THE POLICY SUPPORT INSTRUMENT—PRESS RELEASE; STAFF REPORT; AND STATEMENT BY THE EXECUTIVE DIRECTOR FOR UGANDA (July 2015).
Fraud in action, ladies and gentleman. If your not reading it – then you should read again! Then you might see what has happen with the buying ICT equipment to the Police and this is wasn’t happening. Wonder where the money went? Will you tell the world mr honorable IGP Gen. Kale Kayihura? We would like to know.
SECOND NATIONAL DEVELOPMENT PLAN 2015/16 – 2019/20 (NDPII):
“A Transformed Ugandan Society from a Peasant to a Modern and Prosperous Country within 30 years”.
This here piece will be the important and special words and numbers from this report that has had a release date the same as budget for financial year 2015/2016. This is important to address to show what the draft of 3rd March 2015 is saying. If the numbers has changed then the government should drop and show the world the updated NDPII. But that hasn’t surfaced anywhere. Therefore I will drop the numbers and quotes I do have. It will be a long piece. But this is a big plan with enormous sums of monies in play. So with that play you got show what the government really want to do. I have already showed the dream-piece or press release earlier this week. So this here will see if that has changed or not. The pages where the quotes are from are not direct pages because the page number is different in an pdf so the empty pages also get counted. Just to explain that.
Basic of the Plan:
“This National Development Plan (NDPII) is the second in a series of six 5-year Plans aimed at achieving Uganda Vision 2040” (…) “The Plan also seeks to leverage opportunities and honour obligations presented by emerging developments at the national, regional (East African Community (EAC), and the Africa Agenda 2063), and global levels (the Post 2015 Development Agenda)” (P: 12). “This Plan prioritizes investment in three key growth opportunities including Agriculture; Tourism; Minerals, Oil and Gas as well as two fundamentals: Infrastructure and Human Capital Development” (P: 13).
“The overall government budget deficit level was unstable over the three years, increasing from an overall balance including grants of 2.5 percent of GDP in 2011/12 to 3.4 percent in 2012/13 and to 5.0 percent in 2013/14” (…) “ (…) “Fiscal Deficit: The overall government budget deficit level was unstable over the three years, increasing from an overall balance including grants of 2.5 percent of GDP in 2011/12 to 3.4 percent in 2012/13 and to 5.0 percent in 2013/14.” (…) “Uganda‘s total debt stock rose from UGX11,234.9 billion in 2010/11 to UGX15,939.1 billion in 2012/13 (close to 30 percent of GDP). External debt in 2012/13 was UGX9,893.3 billion (USD3.761 billion). In 2012/13, the total stock of domestic debt stood at 10.4 percent of GDP and 15.8 percent of GDP for the total stock of External debt” (P. 30)
“The Public Debt-to-GDP ratio is currently (2013/14) at 26.14 percent and is projected to peak at about 42 percent in 2019/20, but will remain below the 2013/14 debt strategy threshold of 50 percent throughout the projection period. The debt is however still highly sensitive to non-concessional borrowing, given the current structure of external debt” (P: 32).
“Commercial Banking and Microfinance: As of April 2014, Uganda had 26 licensed commercial banks, with about 544 branches and 5.5 million accounts. The commercial banks hold about 80 percent of the total assets of the financial system and the NSSF holds almost the remaining 20 percent. Savings are still low despite measures to increase savings in the past which included: NSSF improving its return on savings; starting the financial literacy project; URBRA putting in place a framework to enable the informal sector to participate in formal saving schemes; and having SACCO‘s empowered to mobilize savings. SACCOs and MFIs are still experiencing weaknesses in regard to their sustainability, due to the low mobilization of savings from the public, partly due to the over dependence on Government through the Uganda Micro Finance Support Centre and also the fraudulent activities that are a vice to the people‘s savings” (P: 36). “Uganda‘s capital markets are characterized by under capitalization and limited investment opportunities. The Stock Market remains thin, with only 16 companies listed on the Uganda Securities Exchange (USE). Equity markets are poorly developed and only large and well established firms can realistically raise finance on equity markets” (P: 37).
“Generally, during the NDPI period the paved road stock increased at an average rate of 123km, lower than the targeted increase of 220km per year” (P: 42). “The rail infrastructure has not changed over the last 5 years. The current rail network comprises of long meter-gauge rail lines, running from the east to the west of the country. Its operations are limited to 640 km between Kampala-Malaba, Kampala–Port Bell, Kampala-Nalukolongo and Tororo-Gulu, while the rest of the network is defunct” (P: 42).
“Currently, only 2 percent of water is used for production, with only 1 percent of potential irrigable area, where 15,000Ha out of 3,030,000Ha is under formal irrigation. Access to water for livestock at present is estimated at 48.8 percent. The country is increasingly facing a major challenge of prolonged droughts and unexpected floods due to climatic change and variability and is predicted to be water stressed by 2025” (P: 44).
“Financing Health Services: The trend in allocation of funds to the health sector shows an average increase of 20 percent per annum in absolute terms over the past four years of HSSIP. However, the allocation to health as percentage of the total Government budget has reduced from 9.6 percent in 2003/2004 (AHSPR, 2013/14) to 8.6 percent in 2014/15 of the total Government budget much lower than the Abuja Declaration target of 15 percent. This decline has taken place in the midst of rising health care demand and costs due to high population growth” (P: 48-49).
“Pre-Primary Education: The net enrollment at pre-primary level stands at 10.1percent (EMIS 2013). The provision of pre-primary education continues to be dependent on NGOs, multilateral organizations, and the private sector. This limits access with high disparities between urban and rural areas and among different socio-economical levels” (P: 50).
“Primary Education: The implementation of UPE program since 1997 resulted to increased access from 2.5 million to 8.5 million in 2013. The Pupil/Book ratio has stagnated at an average of 4:1 from 2009 to 2013. The repetition rate reduced from 11.7percent in 2009 to 10.3percent in 2013” (P: 50).
“Secondary Education Sub-sector: The Student/Classroom Ratio (SCR) improved from 68:1 in 2009 to 57:1 in 2013 (EMIS 2013). In 2013, Government owned secondary schools were 1,019 (36 percent), private schools were 1,819 (64 percent). Enrolment in Government secondary schools is 669,225 (49 percent) and it is 693,514 (51 percent) in private schools” (P: 51).
“Higher Education: Total student enrolment in higher education increased by 26percent from 183,985 in 2010 to 232,612 in 2013. Universities continue to enrol the majority (67.3 percent) of post-secondary students (156,747) as of 2013. 60 percent of these are in Public Universities. The private providers cater for the remaining 40 percent” (P: 51).
“Economic development and transformation cannot thrive if citizens and investors have no confidence in the rule of law and the justice system” (…) “Good governance provides a setting for the equitable distribution of benefits from economic growth. The Constitution requires that the State promotes balanced development for all regions of the country, between rural and urban areas. It also requires the State to take special measures to develop Uganda‘s least developed areas and to pay special attention to the problems of the marginalized” (P: 57). “The Government of Uganda has adopted the Zero Tolerance‖ to Corruption Policy (2009). The policy correctly recognizes that fighting corruption requires measures beyond legislation and sanctions against corruption. It also requires restoring public sector ethics and creating behavioural change” (P: 60). “However, international surveys, as well as nationally representative data indicate that corruption in Uganda remains a major problem. The East African Bribery Index (EABI, 2013) found that 82 percent of respondents in Uganda described the current level of corruption as high, while 10 percent perceived it to be medium (Transparency International, 2013)” (P: 61).
Oil and Minerals:
“Uganda is destined to benefit from the opportunities explored along the minerals, oil and gas development value chain by addressing a number of challenges and emerging issues involved in minerals and petroleum development” (…) “The petroleum sub-sector is challenged by: inadequate industry infrastructure to support upstream petroleum activities; excitement and high expectations from the general public; lack of skilled manpower, both in the public and the private sectors; inadequate financing; land acquisition for infrastructure development for oil prospecting; and low institutional preparedness; huge capital requirements and technical expertise needed for projects; inconsistent fuel supply leading to scarcity of petroleum products; and absence of a legal framework and associated technical capacity to regulate and minimize the attendant environmental risks” (P: 71).
“There are over 6,351 registered SACCOS with savings of over UGX 120 billion, total shareholding of over UGX 25 billion and loans of UGX 80 billion. Cooperatives have also been formed in other sectors of the economy. For example, 2 energy cooperatives are managing the distribution of energy, 10 housing cooperatives are at various stages of development” (P: 76).
“The country still faces high levels of illiteracy. According to UNHS 2009/10, 6.9 million Ugandans (5.5 million women & 1 .4 million men) aged 15 years and above are non-literate – unable to read, write and numerate with understanding” (P: 83).
“The financing for local governments has increased from UShs974 billion to over UShs2 trillion today” (…) “In general, LG staffing level is at 56 percent for the districts and 57 percent for the municipal councils – a state that has further constrained service delivery. Rapid urbanization characterized by an increase in urban centers from 28 in 1969 to more than 400 in 2013 (1 City, 22 Municipalities, 174 Town Councils and 207 Town Boards) has been without proper planning and facing declining resources. In addition, governance at LGs characterized by poor coordination between the technical and political leadership especially in newly created districts is hindering service delivery” (…) “This is mainly due to breakdown of social values, peoples‘ expectations of hand-outs from government and CSOs, mistrust of communities towards leaders due to persistent unfulfilled promises” (P: 84-85).
“Regional Commitments: Protocol on the establishment of the East African Community Monetary Union. Particularly; Article 2 (b) attain the macroeconomic convergence criteria in article 6 (2) and maintain the criteria for at least 3 consecutive years. The criteria include:
- a) ceiling on headline inflation of 8 percent
- b) a ceiling on fiscal deficit, including grants, of 3 percent of GDP
- c) a ceiling on Gross Public Debt of 50 percent of GDP in Net Present Value terms; and
- d) a reserve cover of 4.5 months of imports
The indicative convergence criteria are;
- a) a ceiling on core inflation of percent
- b) a ceiling on fiscal deficit, excluding grants, of 6 percent of GDP
- c) A tax to GDP ratio of 25 percent” (P: 103).
Part III: Strategic Direction:
“The strategy highlights the key development outcomes expected under the NDPII, the interventions and resources required to achieve these outcomes. The strategy also provides a motivation for the sources of growth and the expected socio-economic outcomes” (P: 111). “The goal of this Plan is to attain middle income status by 2020” (P: 112). “Fiscal Expansion for Frontloading Infrastructure Investment: In order to realize the necessary public investment, government will harness concessional and semi-concessional financing and other development support facilities that are targeted to accelerate investment in infrastructure and human development, among others. Industrialization: To stimulate growth and employment, the country will promote value addition through agro-processing and mineral beneficiation as well as light manufacturing which have a higher multiplier effect on wealth creation. Fast Tracking Skills Development: In order to plug the current skills gap, government will establish five centers of excellence to rapidly build the necessary skills required in the key priority areas. Export Oriented Growth: Uganda‘s strategic location at the heart of East Africa makes it well placed to exploit the regional market. The region is increasingly becoming a fertile ground for small scale exporters, diversifying the export market and adding value to traditional export commodities. A Quasi-Market Approach: A Quasi-Market approach will be pursued in order to increase efficiency of the public sector and competitiveness of the private sector. With this approach Government will invest in key strategic infrastructure in order to remove the barriers of entry and increase private sector participation in the key growth areas” (P: 114).
“Harnessing the Demographic Dividend: Uganda will implement policies aimed at accelerating a rapid decline in fertility and ensure the resulting surplus labour force is well educated, skilled, healthy and economically engaged in order to reap the demographic dividend. Urbanization: Uganda will implement a tripartite strategic policy aimed at accelerating planned and controlled urbanization, while ensuring the critical link between urbanization and modernization of agriculture where the urbanizing community frees land for commercial agriculture as well as create a market for the increased output and quality of agro products. Strengthening Governance: The key development results cannot be achieved without the necessary enabling environment. Meeting good governance principles which include: constitutional democracy; protection of human rights; rule of law; free and fair political and electoral processes; transparency and accountability. Integrating Key Cross-Cutting Issues into Programmes and Projects: The key cross-cutting issues of; Gender, HIV/AIDS, environment, nutrition, climate change, human rights, social protection, child welfare among others will be mainstreamed in the relevant programmes and projects during the implementation of the Plan” (P: 115).
“For this Plan period, focus is placed on investing in the following agricultural enterprises along the value chain: Cotton, Coffee, Tea, Maize, Rice, Cassava, Beans, Fish, Beef, Milk, Citrus and Bananas. These enterprises were selected for a number of reasons including, high potential for food security (maize, beans, Cassava, Bananas); high contribution to export earnings (e.g. Maize – USD 21 million in 2005; coffee -USD 388 million in FY 2007/08; fish – USD 143 million at its peak; tea – USD 56 million in 2007)” (P: 120). “During NDPII the necessary institutional changes should be made so that a clear strategy for agro-processing can be developed and implemented. This should enable proposals for locating value addition facilities in the proposed zones” (P: 121).
“The NDPII has prioritized investment in strategic tourism supportive infrastructure (expansion of Entebbe International Airport, construction of Kabale Airport in Hoima, upgrading of strategic airfields, construction and maintenance of strategic tourism roads, as well as, investing in water transport to support tourism activities” (P: 122).
Minerals, Oils and Gas NDPII:
“The pumping of an estimated reserve of 3.5 billion barrels of oil, expected to start by 2017/18, portends great benefits for transport, energy, road infrastructure and public revenue” (…) “In the first year of implementation of the NDPII, a mineral development master plan containing the Country Mining Vision will be developed to implement the African Mining Vision. The Vision will clearly provide the detailed strategic direction and guidance for the mining, oil and gas during the NDP period and beyond” (P: 124-125).
“Standard Gauge Railway System” (…) “A good railway system would effectively link Uganda to other countries within the East African region and to overseas. This is key to exporting, and importing for manufacturing and services at affordable/competitive rates via connections to Djibouti and Mombasa if we are to achieve the Plan targets” (P: 126). “Strategic Roads” (…)“For this Plan period, 1,500KM of gravel roads will be upgraded to tarmac, 700KM of old paved roads will be rehabilitated and 2,500KM of paved roads and 10,000KMs of unpaved roads will be maintenance” (P: 128) (…) “Energy Infrastructure: Government will invest in the necessary infrastructure to facilitate the exploitation of the abundant renewable energy sources including hydropower, geothermal, and nuclear, so as to increase power generation capacity from 825MW in 2012 to 2,500MW in 2020 and prepare for achievement of the required 41,738 Mega Watts by year 2040” (P: 130). “Oil and Gas: The pumping of this oil and gas is expected to start by 2017/18” (…) “The Government will commence construction of a 22-inch diameter, 1,300Km long oil pipeline from Hoima via Lokichar to Lamu in Kenya. This is in addition to the oil refinery that is to be constructed at Kabaale in Hoima to process petroleum and other products for the domestic and international market” (P: 131). ICT: “Over the Plan period, government will prioritize investment in the following ICT infrastructure: extension of the National Backbone Infrastructure (NBI) to cover most of the country so as to increase penetration of communication services; finalise the migration from analogue to digital terrestrial broadcasting” (P: 132). Human Capital Development: “the Plan will focus on providing early childhood survival and full cognitive development. Efforts will be geared at: reducing incidences of morbidity and mortality; scaling up critical nutrition interventions outcomes especially for children below 5-years; and implementation of Early Childhood Development (ECD)” (P: 134). “A skills development programme will be designed and tailored to the Industrial strategy, production zones and urban corridor locations that will be planned during NDPII. Provisions will be made for skills training on location at infrastructure construction sites to give unemployed young Ugandans rather than imported labour the maximum chance of personal development”(P: 135).
“The NDPII assumes that all the interventions outlined in the strategic direction will be implemented during the period 2015/16-2019/20. In particular, it is assumed that the following will be realized during the NDPII period: (i) increasing productivity of all sectors, (ii) pursuing value addition especially for the agro-processing and mineral products, (iii) creating an environment where industrialization can flourish, and; (iv) improving social delivery of services” (P: 139).
“The fiscal strategy of the NDPII is underpinned by the need to maintain macroeconomic stability and a quest to competitively position Uganda to fully benefit from the East African Common Market” (P: 141). ”The focus of addressing the infrastructure deficit while consolidating the gains in human capital development remains a key priority for the NDPII. In summary, being that infrastructure has been prioritized; the fiscal deficit will mainly be driven by the additional resources required for infrastructure and human capital development” (P: 142).
“The overall average spending is expected to be 21.1 percent of GDP with the peak of 22 percent of GDP expected in 2016/17, and consolidation of spending by the end of the Plan period” (P: 142).
“On the revenue outlook, the NDPII envisages that there will be some improvement in domestic revenue mobilization (excluding oil revenues). These gains will arise from minimizing the use of non-standard VAT tax exemptions which have compromised the effectiveness of tax collection. These exemptions are estimated to reduce government revenue by 1 percent of GDP” (P: 144). “Grants under the NDPII period are expected to decline due to a combination of factors including: (i) austerity measures pursued in donor countries (ii) continued positive growth perception of donors about Uganda‘s recent developments and therefore not being eligible for certain grants. As a result grants are expected to decline further to 0.5 percent by the end of 2020” (P: 145).
Monetary Policy Stance and inflation:
“The Bank of Uganda (BOU) has been implementing monetary policy under an Inflation Targeting Lite (ITL) monetary policy framework since July 2011” (…) “BOU will continue to implement a monetary policy framework that will ensure price stability and at the same time conducive in attaining economic growth over the NDPII period. The inflation outlook will be largely dependent on changes in domestic food prices, exchange rate and international commodity prices. Over the NDPII period, the objective is to keep annual inflation low and stable assuming no major shocks to the economy” (…) “The foreign exchange market: The import content of infrastructure investment in Uganda is estimated to be between 67 percent and 80 percent, but over 80 percent of the key infrastructure projects will be financed from external sources” (…) “Domestic liquidity and private sector credit: The impact of public investment on domestic liquidity will be limited due to the high import content of the infrastructure projects. Nonetheless, a higher fiscal deficit and foreign exchange purchases by BOU will create a liquidity injection that must be managed appropriately to maintain low and stable inflation and healthy levels of private sector credit” (…) “Credit rating: There is a risk that higher fiscal deficits over the medium term will reduce confidence in Uganda‘s public finances. This could lead to a downgrading of the country‘s credit rating and raise interest costs” (P: 149-150).
Concessional External loans:
“Concessional loans are defined as external loans contracted with a grant element of more than 35 percent mainly sourced from the bilateral and multilateral donors. Over the years these loans have cushioned Uganda to finance a moderate deficit. In 2014/15, concessional loans were projected to contribute up to 2.3 percent of GDP” (…) “Less than 50 percent of the financing needs will be met through concessional borrowing in 2013/14. Given this background, the NDPII relies on conservative estimates for concessional borrowing. It is expected that over the NDPII period concessional loans will remain a key source of financing in 2015/16 and 2016/17 and decline to 1 percent of GDP in fiscal year 2019/20 as the financing needs also decline” (P: 151-152).
Semi-Concessional External Loans:
“Financing from semi-concessional loans especially for large infrastructure projects including Karuma and Isimba dams and the SGR are expected to total USD 5.3 billion during the period 2015-20” (…) “Under the NDPII Government will continue to source these types of loans given their favorable terms compared to commercial loans” (P: 152).
Non-Concessional External Borrowing
“It is imperative that Government also starts exploring other options especially to finance large infrastructure projects whose economic returns may not be viable in the short run but with enormous social benefits. Uganda is currently rated at B by Fitch and Standard and Poors rating agencies” (P: 152).
“Government started issuing securities for fiscal purposes in the year 2012/13 raising about UGX650bn (1.2 percent of GDP)” (…) “Given these challenges, the NDPII would attempt to limit domestic borrowing to current levels especially as the infrastructure projects get completed. The level of domestic debt would be limited to the range of 1.5-3 percent if domestic debt is to be contained within sustainable levels” (P: 153).
Public Private Partnership:
“Given the scale of investments required under NDPII, there is need to have close cooperation between the public and private sectors in form of public-private sector partnerships (PPP)” (…) “Government has already embarked on promoting and encouraging PPP in various forms for the smooth implementation of NDPII. Legislation towards formulating laws for PPPs is also in advanced stages. The forms that PPPs usually take include joint ventures between the Government and private sector entity/ies where both may contribute financial resources, Build, Operate and Transfer (BOT), Build, Own, Operate and Transfer (BOOT), Build, Own and Operate (BOO) and Concessions” (P: 153).
“Under this financing strategy, all the solvency and liquidity external debt-burden indicators remained well below their policy-dependent thresholds throughout the projection period. The public gross national debt would peak at 42 percent of GDP in 2019/20 while the NPV is expected to peak at about 40 percent of GDP” (P: 154-155).
This must be an eye-opener. It has already been a long article. I could have written my opinion on the matters and the whole NDPII. But I think the quotes speak for themselves. That if these don’t give you any indication on how the Government of Uganda hopes it turns out. They also told in this draft that certain aspects of the NDPI they didn’t succeed so if they don’t do it here. It shouldn’t be like a lightning strike from a clear sky. More like expected, this should be hard to achieve it’s a broad and general plan that has visions of all aspects of society from narrow industrial projects to infrastructure. That gives a lot of power and also a framework which is big. Therefore they need massive funding for this and already seen in other documents and in this that the scale of debt and loans is getting higher while the donor countries are offering less to the state coffers. Meanwhile the economy isn’t sustainably growing. While the Oil and Gas might cover for this that will still to be seen in 2017/2018 when the monies are expecting to recover. In the meanwhile the economy will drive itself on loans and hope for other funding. It’s already up to 40% of all budget concerns which is alarming. It should be, even if progression and analyzes say it can go up to 50% before the debt rate is too high. Even though that makes sense from an economic standpoint it’s still frightening to see the figures on how it has risen. And I wonder does the government have a constructive plan to pay this back to its creditors? Because that doesn’t comply here or anywhere else I have seen which is a little bit frightening. Peace.
This blog here will be focused on the ‘Office of the Auditor General’ who released ‘Annual report of the Auditor General for the Financial Year ended 30th June 2014 – Volume 5 Value for Money Audit’. What you will read is actual quotes from the paper or report. Here you get a vivid picture of how the financial year (FY 2013-2014) was in reality.
I haven’t taken everything from the piece. It would be too long and you might end up bored. Here is what should get your mind boggling and wonder. How could this be this way? Why is it like this? How did it end up like this? What does this tell me about the economic practices in Uganda? And so on. If you start to think like that, then it was worth using my time. Enjoy the quotes from the report. Hope you catch some wisdom.
When it comes to managing Public Debt:
“Public debt is incurred primarily for financing budget deficits, development of domestic financial markets, supporting the country’s Balance of Payment (BOP) position/foreign reserves and monetary policy objectives. In Uganda, public debt is managed by the Ministry of Finance, Planning and Economic Development (MoFPED) in liaison with Bank of Uganda (BoU). Government borrows internally from domestic markets through issuance of Treasury bills and Bonds by the BoU and externally through Bilateral and multilateral borrowings. Currently, over 60% of the public debt is external debt and 40% is domestic debt. GoU borrowing has been rising over the years from USD 5.7 billion in Financial Year (FY) 2011/12 to USD 7 billion in FY 2013/14. The growing National debt, if not properly managed, could revert to unsustainable levels as was the case in the past”.
“Interest rates on domestic debt have overall stabilised in recent years relative to their peak in 2011/12. However, they remain a cause for concern due to their high contribution to overall debt service costs and the relatively high yields which they attract stand in stark contrast to those achieved by comparator nations with similar credit ratings”.
When it comes to roads:
“The Uganda Road Fund invested a total of UGX 914 billion in road maintenance activities during the three years under review (2011/2012, 2012/2013 and 2013/2014),4 with a total of 4,565km of roads maintained. Despite the increasing investment, there are reports and persistent public outcry about the poor state of roads and the deteriorating quality of works being executed. The physical and financial performance reports of designated agencies in FY 2011/12 revealed the following issues: budget indiscipline, poor absorption of road maintenance funds, inaccuracies in reporting, lethargy of Designated Agencies (DAs) in complying with reporting requirements, widely varying unit costs, risk of loss of funds through end of year procedures, and grave underperformance of periodic maintenance works” (…) ”The road maintenance needs in Uganda cannot be met due to limited resources, for example for FY 2011/2012, the total maintenance needs from the agencies was UGX 413.95bn, and the budget provided by the Ministry of Finance, Planning and Economic Development (MoFPED) was UGX 280.95bn, indicating a 32% deficit” (…) “The road maintenance equipment inventory maintained by the URF is incomplete; the inventory is only for 12 (55%) of the municipalities and it is outdated as it was submitted in January 2011”.
When it comes to Gas and Oil:
“Through a review of reports on procurement submitted by the oil companies to PEPD, it was noted that from 2010-2013, the oil companies spent a total of USD 1,171.8 million on purchase of goods and services. Of this, USD 329.9 million was paid to Ugandan service providers, representing 28% of the total spend for all the companies in the period under review” (…) “The Ugandan service providers comprised about 73% of the approved suppliers which implies that the total value of the procurements from them was less than their relative number” (…) “Ugandans employed in the oil and gas sector by the oil companies overall rose from 69% in 2012 to 80% in 2014, absolute numbers of employees decreased from 546 to 432 between 2013 and 2014; in particular, the nationals dropped from 370 to 347 over the same period” (…) “For all the 27 jobs advertised in the newspapers, attracting over 700 local applicants, none was appointed, citing lack of experience in the oil and gas sector. Instead, the recruitment report submitted by the CNOOC to PEPD recommended recruitment of expatriates” (…) “According to the Industrial baseline survey done by the Joint Venture partners (CNOOC, TEP and TUOP), 60% of the workforce required for the next phases will be technicians and craftsmen, which translates to a demand of 7,800 and 1,800 technicians and craftsmen at the peak and plateau phases, respectively, of development and production. With the current total of only 86 UPIK graduates, there is doubt that the projected demand will be met by the time production starts (2018)” (…) “There are still several areas with clear potential for enhancing national content, such as: establishment of a clear regulatory framework, performance targets and indicators for national content; determining the level of state participation; local supplier development; employment and training of Nationals by the oil companies and government; ensuring gender parity and involving host communities”.
When it comes to the Healthcare:
“The Uganda Health Systems Strengthening Project (UHSSP) is a project administered under the Ministry of Health (MoH)” (…) “UHSSP, is a five year project, which was established in 2010, commenced operations in February 2011 and is due to end on 31st July 2015. The UHSSP project is jointly funded by the Government of Uganda (GoU) and the World Bank to a tune of USD 14.31 million and USD 130 million, respectively” (…) “UHSSP was set up to bridge the existing gap of supply and maintenance of medical equipment in 46 selected health facilities in order to improve the quality of health care delivered to patients. The project has spent USD 24 million (UGX 60.480 billion) on procurement and supply of these medical equipment, yet some of the equipment remains unused in the facilities where it was supplied” (…) “For instance, at the time of audit field visit in September 2014, the project had supplied anesthetics machines to 165 HCIVs at a cost of USD 2,063,085.75, however, all the HCIVs visited were not utilising this equipment because they lacked the technical expertise to effectively utilise the equipment. In a related instance, 2 auto strainers valued at USD 25,345.68, which were issued to Mubende and Moroto Regional Referral Hospitals, are not operational because of lack of qualified staff” (…) “observations conducted during field visits to the seventeen selected beneficiary health facilities, it was noted that some of the equipment supplied, worth Euros 3,954.67 and USD 1,209,879.09, was not being used at all while other equipment was not optimally utilized” (…) “Through field inspections, it was observed that health facilities namely Mwizi had no power supply while others such as: Moyo, Aduku, Aboke Pakwach had unreliable solar power supply, and therefore, were not providing emergency obstetric care services when needed” (…) “that various equipment supplied by the project, worth USD 319,676.35 and Euros 347.24, required additional logistical supplies to be effectively put to use. Such equipment included anesthesia units which required regulators, oxygen cylinders and other reagents while incubator cultures, incubator baby, defribrators, counting chamber, colorimeter required Medias, distilled water, thermometers, tubes and batteries”.
When it comes to handling Public Debt Part 2:
“Uganda benefited from the various Debt relief initiatives like the Heavily Indebted Poor Country (HIPC) Initiative in 1998, the Enhanced HIPC in 2000 and the Multilateral Debt Relief Initiative (MDRI) in 2006. Despite these initiatives, GoU borrowing has been rising over the years from USD 5.7 billion in Financial Year (FY) 2011/12 to USD 7 billion in FY 2013/14. The growing National debt, if not properly managed, could revert to unsustainable levels as was the case in the past” (…) “In the FY 2013/14 Public debt increased to USD 7 billion up from USD 6.4 billion in F/Y 2012/13, reflecting a 9.38% increment in one year alone, the increment was way above the GDP growth of 6.2% in the FY 2013/14. Domestic debt accounted for 9.55% (UGX 1,437 billion) of the National budget, 2014/15 an increase of 1.65% (UGX 397 billion) from 7.9% (UGX 1,040 billion) in financialyear 2013/14. External financing on the other hand increased from UGX 2,660 billion in F/Y 2013/14 to UGX 2,733 billion of the National budget, 2014/15 an increase of UGX 73 billion. As non-concessional borrowing increases, the need for proper debt management becomes even much greater” (…) “On average, 60% of public debt is external loans of which Multilateral loans constitute over 80%. The domestic debt is largely derived from the sale of bonds which constituted an average of about 60% over the period FY2011/12 – 2013/14 “ (…) “In evaluating whether the debt, acquisition process facilitates debt sustainability, the audit mainly focussed on the acquisition of external debt since it constitutes over 60% of the National debt portfolio” (…) “The 2012 corruption scandal involving the Prime Minister’s office resulted in a changed relationship between multilateral lenders to the Ugandan government and a consequent reduction in the amount of aid in the form of direct budget support. Budget support in 2011/12 amounted to 168m USD, but reduced to 24.1m USD in 2013/14. The shortfall has in part been filled through domestic financing” (…) “The lack of coordination between debt and cash management functions contributed to inaccurate forecasting of cash needs. This exacerbated the problem of unplanned cuts to government programmes and led to the needless issuance of short-term debt, with the associated debt service costs” (…) “it was noted that local government authorities still held significant cash balances accrued from non-tax revenues and unutilised balances which were not remitted to the Consolidated Fund regularly, and that some accounts containing cash lay dormant, risking embezzlement” (…) “the current economic conditions characterised by reduced exports and a depreciating Ugandan Shilling against the dollar (30% for the last 4 months) there is a risk of stress which can affect future sustainability. Interest rates on domestic debt remain a cause for concern due to their high contribution to overall debt service costs (78%)”
When it comes to Health Care Part 2:
“Over the past three financial years 2011/12, 2012/13 and 2013/14, there has been an 18% increment in the funding of RRHs from UGX 53.86 billion to UGX 63.56 billion” (…) “Jinja nd Lira RRHs revealed that Jinja RRH which ran a 13-bed Intensive Care unit only used 6 of the beds, leaving 7 beds idle in the unit while Lira RRH had not utilized its 16-bed ICU since FY 2012/13. The Hospital Directors of Jinja and Lira RRHs explained that more nurses wouldhave to be deployed as each bed required at least 2 full time nurses to the unit to ensure full utilisation of the unit without compromising the quality of care. The unit would also require full time doctors and an anaesthesiologist. In Lira RRH, management explained that the ICU had not been commissioned and that its underutilisation was also due to the absence of an oxygen plant” (…) “With the current ICU bed capacity in Uganda of 61 in all public and private hospitals, 23 unutilized ICU beds in Jinja and Lira represents a wasted resource. It is estimated that about 10 critically ill patients were deprived of ICU admission daily and as a result succumbed to their illnesses” (…) “Hospital managers in response attributed this to the lack of bio medical engineers and high costs of repairing the equipment, for instance, according to Jinja RRH, the maintenance of the En-Visor ultra sound machine and the repairs of the Duo-Diagnostic big x-ray machine requires not less than UGX 15 million, and without a medical equipment maintenance fund, it is a challenge to maintain and repair the radiology and imaging machines. Management of Fort Portal RRH attributed the low usage of the x-ray and ultrasound machines to stock-outs of the supplies, such as reagents and films required for the operation of this diagnostic equipment” (…) “The average doctor-patient ratio per year in RRHs was 12440:1 implying one doctor for 34 patients per day while clinician- patient ratio was 10652:1 annually implying one clinician for 29 patients” (…) “For example; Kabale, Fort Portal, Masaka and Mbale Regional Hospitals referred some special cases to Mbarara RRH for services like CT scan, renal dialysis, neurosurgeon, paediatric surgery. In addition, lack of adequate staff has led to referrals to the National Referral Hospital and this has further resulted in the congestion and handling of cases at National Referral Hospital which cases could be handled by the RRHs. The process of referrals is costly and in some cases patients lose their lives in the process of reaching the health facility to which they have been referred”.
When it comes to Management of Sewage in Urban areas:
“Poor sanitation costs Uganda 389 billion shillings annually, equivalent to 1.1% of the national GDP” (…) “Fifty six percent (56%) of the pipes in Kampala were built in the 1940s and 86% of these have been operational for 35 years or more” (…) “National Water and Sewerage Corporation (NWSC)” (…) “NWSC had spent UGX 10.9billion towards sewage management activities in the areas under its jurisdiction over the last three years” (…) “the volume of sewage generated in the different towns and the volume of sewage collected and treated by NWSC, a study conducted by Mott Macdonald on behalf of NWSC in December 2012 estimated that by 2014, a total of 238.9 ML of wastewater would be generated of which, only 8.38ML would be collected and treated. This leaves approximately 230.52 ML of generated sewage uncollected and therefore not treated”.
I hope this was worth your time and also giving you an indication on the matters on the ground. This is just a fragment on the matters and what got told in the report. This just comes as gift to you. Especially to all of you who don’t use time reading the report on your free will or are lucky enough to get the report in your mailbox. Never the less, hope you got enlighten and also got a picture on how the monies is spent in last FY. Peace.
It’s this part of the year again. I had several post on budget allocations and the new Petroleum concerns during the FY 2014/2015. Now it’s the start of the FY 2015/2016. It’s time to look at some of the documents that I have gotten and address them properly. I wonder sometimes why I am lucky and getting them. But since I do get them, I have the power to pin-point and question certain Acts and legislation. I will cut out today the most important and questioning pieces of words and law from the Acts of Supplements No. 2. – 6. March 2015: ACT3- The Public Finance Management Act, 2015. I could have taken with more and asked more are about certain propositions here.
Hope you’ll find this findings interesting:
If you don’t have any questions and wondering what this really means as well for the citizens of Uganda. The way about the ‘Classified Expenditure’, ‘the Petroleum Fund’ and the way the money will be used from the ‘Petroleum Revenue’. If that isn’t a tasty dish for you think about. Then I don’t know what to serve you. This a plate full of heavy beef. If you don’t wonder yourself. You should read it again. And ask yourself. What are they really doing and how can they do this this way, without being really questioned? Peace.
The limitations of the oil and gas industry in Uganda is combined and conformed by this certain institutions:
Parliament, Revenue Authority (URA), Bank of Uganda (BoU), and the National Oil Company (NOC), the Auditor General (OAG) and the Petroleum Authority of Uganda (PAU) and the Petroleum Exploration and Production Department (PEPD) (Magelah, P1, 2014).
The biggest issue for all the institutions in Uganda is the financial and human resources to enforce their mandate on the matter: “At present the house has about 5 full time researchers for about 370 Members of parliament” (…)”Under the PFB for example the minister has powers to change from the goals of the Chatter of Fiscal Responsibility without seeking parliament’s approval, under clause 61 the minister can direct BOU on what to do, the minister appoints the petroleum investment committee and under clause 59 the minister can chose where and in which form investment of petroleum funds should be. The framing of clause 59 is such that the minister’s decision on investment of petroleum funds is final and all institutions must obey it. Under clause 71 the minister keeps the excess funds meant for district” (…)”One such example is BOU which according to article 162 of the Uganda constitution provides that BOU should be independent and not subject to the control or direction of any person” (Magelah, P2, 2014).
Three other main concerns is the basic movement between government agencies: “The end result has been court cases where oil companies are challenging URA for taxing them. It is clear from these cases that the PEPD never consulted URA in granting tax exemptions and his has resulted in the present situation”.
Second concern is: “The NOC was created under the petroleum upstream act, however the act did not provide for funding, accountability and auditing of the NOC”. Where its hard to prove and also see if there are transparency for the agencies and governmental organizations and also see the progress of the companies who drill the oil.
Third concern: “here is also luck of provisions for participation in Extractive Industry Transparency Initiatives (EITI). The National Oil and Gas policy provide for government to participate in the EITI”. It says itself: you can now see how limited the organization in Uganda is on the matter of drilling and oil and gas. Their mandate and little manpower from both the 5 researchers and to support the 370 MPs. So we can now see how this will affect the new industry and how these weak and vague institutions will keep the upkeep for industry as whole.
Magelah, Peter Gwayaka – ‘Institutional Limitations for Uganda’s oil and gas sector Paper presented at workshop on Deepening Transparency and Accountability of Extractive Sector in East Africa’ (17.09.-19.09. 2014)
Here is my discussion on the document that is about the new Public Finance Bill of 2014.
Professor Ezra Suruma wrote a paper called ‘Will Parliament lose influence to the Executive in the budgeting process under the new Public Finance Bill?’ in August of 2014 (Suruma, 2014). Ezra Suruma is a Ugandan economist he works at the Brookings Institute in Washington D.C. where he is a part of the African Growth Initiative of in the institute. Second occupation is senior advisor to Ugandan President on finance and economic planning (Wikipedia, 2014).
Ezra Suruma says about the part of macroeconomic and fiscal policies where he is quoted to say: “The development of fiscal policy and the charter of fiscal responsibility lie solely with the minister. However, in the first session of Parliament, the minister is required to prepare and submit to Parliament the Charter of Fiscal responsibility for approval” (Suruma, 2014, P: 2).
New Zealand government has a splendid way of looking at what Fiscal responsibility:
“Fiscal policy comprises decisions about government spending and taxation. These decisions are made with a view to goals such as the optimal allocation of resources, economic stabilisation and the longer term sustainability of public finances” (New Zealand Government, 2005).
So if there is only transparency for the Minister and not the responsibility for the Parliament to oversee an approval. Then we know that there will be instances where the Ministers doesn’t have to show their progress or work to a broader public. This isn’t what you would call a transparent fiscal policy from the government of Uganda.
“The Minister shall within one month of the commencement of the first session of Parliament, submit to Parliament the Charter of Fiscal Responsibility for approval.”(Suruma, P: 2 2014). Suruma comments that it will only take from 31. December to the 1st of February until reading the budget, something which seems like a little time to prepare and give the opposition time to answer and make switches and tweak the budget of that year to come.
There is given specific powers to the Parliament which is part of ‘Clause 10’ in the new Public Finance bill of 2014 says:
“(1) The Parliament shall analyze the policies and programs that affect the economy and the annual budget and where necessary, make recommendations to the Ministry on alternative approaches to a policy or program. (2) The Parliament shall ensure that public resources are held and utilized in a transparent, accountable, efficient, effective and sustainable manner and in accordance with the Charter of Fiscal Responsibility and the Budget Framework Paper.” (Suruma, P: 2, 2014).
All of this should be in a bill, if you expect the parliament to shine lights on the budget and are main objective for the Fiscal Responsibility. The Parliament should make recommendation to the Ministry to a certain policy and give insights to other visions of what the government need to use sufficient funds and budget enough for the expenses of running the state and its obligations to its people.
This was on the Part II Budget preparation, approval and management on page 3 (Suruma, 2014). Directly from the new law text:
“12. Approval of annual budget by Parliament (Suruma, P:3, 2014).
(1) The Parliament shall, by the 31st of May of each year, consider and approve the annual budget and work plan of Government of the next financial year and the Appropriation Bill and
any other Bills that may be necessary to implement the annual budget (Suruma, P:3, 2014).
(2) Where the President is satisfied that the Appropriation Act in respect of any financial year, will not or has not come into operation by the beginning of any financial year, the President may, in accordance with Article 154 Constitution, by warrant under his or her hand, addressed to the Minister, authorise the issue of monies from the Consolidated Fund for purposes of meeting the expenditure necessary to carry on the services of the Government, until the expiration of four months from the beginning of that financial year, or from the coming into operation of the Appropriation Act, whichever is the earlier” (Suruma, P3-4, 2014).
As Suruma himself commented on page 3.Read directly part 12:2. Do you see what it is really is saying. That it has to be “one third of the budget would be approved by the executive without the approval of Parliament”. The Executive approve one third of the budget without the Parliament. That is lots of money that doesn’t need any transparency, or votes to the public unit, or in the view of more than the executive. Suruma continues on Page 4: “If this is approved it will reduce the power of Parliament from 100% power over appropriation to 67%. The appropriations for 33% or the first 4 months of the year will now shift to the President” (Suruma, P: 4, 2014). As you see that the approved power will be 33% will be delivered directly to the president. They have only 67 %. The Parliament is supposed to have a full discloser and 100 % power of the budget, not a little over 50 %.
Another main change that is being discussed by Suruma on page 4:
“Although the minister may increase the appropriation of a vote by 10%, the amount so increased must come from the Contingency Fund. The Contingency fund has been raised slightly to 3.5% of the budget” (Suruma, P: 4, 2014). So the minister of finance has also gotten more power than before. Just see the percentage of the vote that he has for the Contingency Fund and also the piece of the whole budget.
“28. Investment of balances on the Consolidated Fund.
Any sums standing to the credit of the Consolidated Fund may be
(a) with an approved financial institution at call; (Suruma, P: 4, 2014)
(b) subject to notice not exceeding twelve months; or
(c) in an investment authorized by the law for the investment
of trustee funds and approved by the Minister.
(Suruma, P: 5, 2014).
- Who approves the financial institution to be invested in? There is room for considerable corruption here.
- What is meant by “an investment authorized by the law? Which law?
- The “trustee funds” are not defined in this law’s definitions (interpretations).
- Does authorization by the minister place her at risk?
(Suruma, P: 5, 2014).
This here has already Suruma pointed on big important points and questions that should be visible and addressed. Like which law question is just so cold and still so clear what he means when Suruma ask it. The minister has authorization and also right to choose investment even though it doesn’t say what kind of law that is authorization to the funds he needs to provide investments or what powers he need to give rights to authorize the actions of the ministry.
Suruma is continuing on Part VI accounting and audit:
(5) An Accounting Officer shall be responsible and personally accountable to Parliament for the activities of a vote (clause 43 (5) (Saruma, P: 5, 2014). As Suruma says and is understood that there is technocrats, there is only Parliament is mention in the law from the page 5 is on a previous audits. As it seems there is technocrats who gets the overview over the budget and not the parliament. This has become very natural process in many nations from the USA, Zimbabwe and even Greece. So this is not a problem only for Uganda, but a modern day issue which shouldn’t be left under a rug.
Under Amendments on page 6 (Suruma, P: 6, 2014). The Committee on National Economy Suruma himself even he comments that the power over the Committee is the Executive branch of the Government. This means that the President can control the Committee on National Economy.
“On Parliament Budget Office:
“(1) There shall be a Parliamentary Budget Office within the Parliamentary Services with the Clerk of the Parliament being the Accounting Officer, consisting of full time and part time budget and economic experts as may be required from time to time” (Suruma, P: 8, 2014).
(2) The function of the Parliamentary Budget Office shall be to provide Parliament and its committees with objective and timely analysis to assess economic and budget proposals including analysis of the economic and fiscal planning and reporting documents and annual budget documents, and without prejudice to the generality of the foregoing shall-
(a) Provide budget related information to all committees in relation to their jurisdiction;
(b) Prepare reports on budgetary projections and economic forecasts and make proposals to Committees of Parliament responsible for budgetary matters;
(c) Prepare analyses of specific issues, including financial risks posed by Government policies and activities to guide Parliament;
(d) Consider budget proposals and economic trends and make recommendations to the relevant committee of Parliament with respect to those proposals and trends;
(e) Prepare analytical studies of specific subjects such as fiscal risks posed by government owned or partially owned enterprises and other sources of risk;
(f) Evaluate the government’s explanations of deviations from the fiscal responsibility principles or fiscal objectives and the plans to address such deviations;
(g) Report to the relevant committees of Parliament on any Bill that is submitted to Parliament that has an economic and financial impact, making reference to the Charter of Fiscal Responsibility and its principles and to the financial objectives set out in the relevant Budget Framework Paper;
(h) Generally give advice to Parliament and its committees on the Budget and economy;
(i) Report on any other subjects relating to fiscal policy and performance requested by a committee or initiated by the Parliamentary Budget Office in the interests of assisting Parliament.
(3) The Parliamentary Budget Office shal1 ensure that all reports, studies, evaluations, findings, recommendations and other outputs are presented in a user-friendly form and that all outputs are published in a timely manner unless publication is not in the public interest”
(Suruma, P: 8-9, 2014)
Minister’s Report on Performance:
(1) The Minister shall report at least twice per financial year on Government’s performance against the fiscal objectives in the Charter for Fiscal Responsibility and Annual Budget.
(2) In reporting performance against its fiscal performance, the government shall provide-
(a) Updated macroeconomic and fiscal forecasts with sufficient information to show changes from the forecasts in the last Budget Framework Paper or Annual Budget;
(b) Budget execution compared to the appropriations and other lawful spending authorities.”
(Suruma, P: 9, 2014)
The continuation is of the problem that we’re on page 6. The technocrats have the powers over the budget and not the parliament who will execute the budget on these matters. It is not something new in this matter, it’s kind of normal in our day and age. NPM – New Public Management and those technocrats get their wisdom across instead of the people we elect.
PART VII: PETROLEUM REVENUE MANAGEMENT
The major players in petroleum revenue management are the following:
- The Bank of Uganda plays a leading role as the account holder of the Petroleum Fund and the operational manager of oil revenue investments.
- The Uganda Revenue Authority is the institution empowered to collect and receive the oil revenues and then pass them on to the Bank of Uganda.
- The Minister, the Secretary to the Treasury, the Accountant General and the Auditor General are all central figures with numerous powers in the management of oil revenues.
- Parliament is also a key player in so far as it has the ultimate power to decide how much should be taken from the Petroleum Fund and placed on the Consolidated Fund and how it should be spent (appropriation).
- The Investment Advisory Committee is appointed by the minister of finance and is supposed to advise her (him) on the policies to follow in investing the oil revenues.
- External Investment Managers are the investment banks, brokers, financial advisers etc who will be selected to manage the petroleum investments overseas.
(Suruma, P: 10, 2014)
ISSUES IN OIL REVENUE MANAGEMENT
There ia an old saying that “too many cooks spoil the broth”. There are so many power centres that it is difficult to know how they will interact and not conflict and cause paralysis. Specifically, I wish to make the following observations:
- The powers of the Advisory Investment Committee appear to conflict with those of the Bank of Uganda in deciding what to invest in and with whom. It is difficult to see how the minister will negotiate between these two policy advisory bodies.
- The minister has potentially damaging powers of determining “other qualifying instruments” in which the funds can be invested. This power will make her the subject of “vultures” seeking to woo her to invest with them. The phrase should be removed.
- The Bill allows investment in “derivitives” which I consider unduly risky. I do not think it should be a qualifying instrument. The idea that anyone can determine the relative risk of the underlying instrument vis a vis the derivitive and then determine that they have equal risk is in my opinion not realistic.
- Although the amendments purport to create only one Petroleum Fund and to abolish the “Investment Reserves Account” yet the Bill reverts to the term “Funds” in place of “reserves” and sometimes speaks of investments. At the end of the day it seems certain that there is more than one “Fund”.There may be one “mother fund” but the context of the law suggests that there will be many funds and investments. So the amendment creates more confusion than clarity.
- The idea of an “agreement” between the Minister and the Governor to manage the investments properly seems to add to the confusion. On top of that the minister is to give “directions” to the Bank of Uganda on how to invest. Do not forget that there is also an investment policy arising from the Investment Advisory Committee.
- The number of reports which Bank of Uganda has to give and the frequency, while reassuring, is mind boggling. There are requirements for monthly reports, forecasts, semi-annual reports, annual reports, annual plans, audits, 10 year plans, schedule of investment managers, risk assessment reports, compliance reports etc. Similarly, the minister has to make corresponding reports to Parliament.
I have two concerns:
(a) Can bank of Uganda do all these reports and continue to its other responsibilities such as banks supervision and monetary policy?
(b) Can the Minister or the Parliament possibly absorb all these documents?
- There is confusion in the utilization of oil revenues. On the one hand Parliament is to decide how much to appropriate from the Fund to the Consolidated Account. It is also to decide the appropriations to different votes. Yet the Bill purports to legislate, before hand that the oil money can only go to infrastructure and development projects.So when it comes to access to the government oil funds the direct beneficiaries will be the external investment managers, the external owners of infrastructure companies (the road and power constractors) and the districts of the oil producing areas who will get 7% of the royalties. The rest of us will be indirect beneficiaries – those who drive and those who have access to electricity. The rural populations will wait for a long time.
- Employment is mentioned once in Schedule 2. Pension for the aged or disabled is not mentioned. Health insurance is not mentioned. Credit for businesses and for agriculture is not mentioned. No new banks, no new directions to increase access to more and cheaper credit. Even education does not seem to feature anywhere. Only hardware and external beneficiaries are clearly demarcated.
(Suruma, P: 11, 2014)
As seen on Petroleum Revenue Management you can see that there are many actors in it. For the Bank of Uganda and Uganda Revenue Authority has their part. Then it’s all the different parts of the government which is supposed to follow the industry of the oil revenue. From the Parliament, Treasury Secretary to the Investment Advisory Committee and also the External Investment Managers. With this it proves that it should be transparent with the Oil revenue because it has to go by everything from the National Bank of Uganda, the tax office in URA and all the Governmental institutions and committees. This tells it all.
I think the eight points that Suruma has pointed out I don’t think I need to address since there are so valid on their own. You should think about them yourself! There are just a lot of issues for the government and the parliament together with the other institutions of finance that the government has at its disposals.
The technocrats have a lot of power when it comes to budget and also the financial of fiscal transparency. Public Transparency Bill gives much more power to executive branch or the President. The Parliament will now have around 60 percent of its power instead of a 100 % as it has today. Which is a big step for the government and also with the movement of financial transparency has the same issue as the rest of the world where the technocrats has a lot of power over the planning and executing the budget, and not the Parliament or the Executive branch. Even if the Executive branch is getting more place, even the; “Although the minister may increase the appropriation of a vote by 10%, the amount so increased must come from the Contingency Fund. The Contingency fund has been raised slightly to 3.5% of the budget”. This proves that both the Executive branch, the president and also the Finance Ministry gets more direct power even if the technocrats get a bigger oversight over the budget and the finances of the state.
PS: Want to say thanks to Parliament Watch Uganda! For loading the document online.
New Zealand Government – ‘A Guide to the Public Finance Act’ (August, 2005) Link: http://www.treasury.govt.nz/publications/guidance/publicfinance/pfaguide/guide-pfa.pdf
Suruma, Ezra – ‘Will Parliament lose influence to the Executive in the budgeting process under the new Public Finance Bill?’ (August, 2014) Link: http://www.scribd.com/doc/237400795/Public-Finance-Bill-Paper-14-Aug-2014
Wikipedia – ‘Ezra Suruma’ (02.05.2014) Link: http://en.wikipedia.org/wiki/Ezra_Suruma