Revised Budget 2015/2016 focusses on Energy and Transport
In the latest revised draft budget, security, energy and the transport sector have been allocated more resources in the 2015/2016 budget. Government has revised the total budget for the next financial year from sh14trillion which had been put in the budget framework paper to sh18.4trillion. According to the new Public Finance Management Act, parliament has only up to Friday this week to complete the process of scrutinising and approving the 2015/2016 budget.
Aware that URA revenue collection target for 2015/2016 is sh11.1trillion, government will be able to fund the next budget by about 60% and the remaining percentage will be from external and domestic borrowing.
Transport increases to sh3.1trillion
According to the paper New Vision obtained from the state minister for finance and controversial anti-gay activist, David Bahati, the works and transport sector will get the biggest portion of the national budget of sh3.1trillion. Tarmacking of the Kaiso-Tonya section of one of the ‘oil roads’ in western Uganda road. In the initial budget framework paper which was released in early March this year, the sector had been allocated sh2.5trillion. In the ending 2014/2015 financial year, it was allocated sh2.3trillion. Whereas Works and Transport has continuously received the lion’s share of the national budget for the last five years, the sector is greatly corruption-infested, which leads to shoddy work done in many projects. It is upon that background that government has resorted to procuring road construction equipment for UNRA and districts to have capacity to construct roads to reduce dependence on private road construction firms which are very expensive to hire.
Energy & Security
The energy and mineral development sector, which had been initially allocated only sh815.5b, has been allocated sh2.7trillion in the revised draft budget. The sector was allocated sh1.8trillion in the 2014/2015 budget. Part of the increased allocation to this sector is meant to cater for the construction of the 600 megawatts Karuma hydro power dam in Kiryandongo district. The security sector budget, which had been put at sh1.1trillion, has been increased to sh1.5trillion. Government indicates that the focus for the 2015/2016 security budget will be to increase vigilance to neutralise security threats through increased capability including acquisition and maintenance of requisite equipment, combat service support, training, improved general welfare and deployments in support of national interests.
Agriculture & Education
The budget for agriculture has also been slightly adjusted from sh473.7b to sh484.6b, which is nearly 3% of the total budget. The sector was allocated sh417b in the current financial year. Considering that agriculture is still the backbone of Uganda’s economy, Parliament and many other stakeholders have on several occasions urged government to increase the sector’s budget. The 2003 Maputo protocol committed African governments to allocate not less than 10% of their national budgets to Agriculture and the 2012 NRM caucus retreat at Kyankwanzi resolved that not less than 7% of the national budget should go to agriculture. The education sector budget has also been slightly adjusted upwards from sh1.9trillion to sh2trillion.
Despite calls from parliament and the civil society, government has continued to allocate the health sector a small portion of about 7% of the national budget. The sector’s budget has been adjusted upwards from sh963.7b initially proposed to sh1.2trillion, the same amount it was allocated in the current financial year In the 2001 April Abuja declaration, African governments committed themselves to allocating not less than 15% of their national budgets to the health sector.
In other allocations, water and environment will get sh520.8b, Justice/Law and Order will get sh906.6b, accountability sh1.1trillion, trade, tourism and industry sh79.3b, lands sh125.9b, social development sh79.9b, ICT sh20.8b, legislature sh301.6b, public sector management sh776.1b, public administration sh716.3b, pensions and gratuity sh331.1b, and sh1.7trillon will be for interest payment on government loans. Going by the new budget timetable arising from the newly passed Public Finance Management Act, parliament has up to May 30, 2015 to scrutinize and approve the budget before commencement of the financial year. Previously, the process would go on up to the end of August after commencement of the financial year which would always delay budget implementation.
Comments on Budget
Commenting on the revised budget, the shadow minister for finance Geoffrey Ekanya said, “That budget is not in conformity with the new law of Public Finance Management Act and the National Development Plan. All the requests for external and internal borrowing should have been approved before determining expenditure. "It is meant to divert money for politics and that is why security which has classified expenditure is getting more. Key sectors like agriculture and health continue to be underfunded.” Apart from energy and transport sectors, other core non-consumptive sectors like agriculture, ICT, tourism, trade and industry which the National Development Plan recommends to be prioritised have continued to get marginal portions of the national budget.
Yumbe woman MP Huda Oleru (NRM) said, “Am so disappointed that government has continued to ignore agriculture yet 80% of Ugandans depend on it. Our shilling continues losing value against the dollar because we are over importing and exporting very less. Can you imagine we even import food products like rice? The sector needs more money for mechanized agriculture, irrigation and fertilizers.” Shadow minister for the youth and Ayivu county MP Bernard Atiku (FDC) said, “I propose that the Office of the Prime Minister, State House, and security should have their budgets reduced by 2% each and the deducted money be allocated to agriculture.”
On giving dismal portions of the budget to agriculture, tourism, trade and industry, the state minister for finance in charge of privatization Aston Kajara said “Agriculture is cross-cutting. If we invest in energy, and infrastructure, it has a direct bearing on agriculture in terms of transportation and value addition on agricultural products. The same applies to trade and industry sector.”