Monday January 20 2014

New districts piling pressure on meagre resources - Muhakanizi

Secretary to the Treasury Keith Muhakanizi (standing) consults with director budget Ministry of Finance Kenneth Mugambe during the meeting in Kampala last week.

Secretary to the Treasury Keith Muhakanizi (standing) consults with director budget Ministry of Finance Kenneth Mugambe during the meeting in Kampala last week. Looking on is Allen Kagina URA Commissioner General (2ndR) and the Auditor General John Muwanga (L). PHOTO BY STEPHEN OTAGE. 

By Stephen Otage


Uganda is now feeling the impact of uncontrolled population growth and creation of new districts because they do not match the available resources to sustain them, a Ministry of Finance official has said.

As a result, the newly created districts are becoming a burden to the country because they lack economic resources yet they are encouraging rapid urbanisation which is creating rapid population growth that is not backed by resources to support the population.

While addressing a ‘national consultative budget’ conference in Kampala last week, the Secretary to the Treasury, Mr Keith Muhakanizi, warned that Uganda is facing a fundamental problem created by the newly created districts.

He added that the population growth trends over the last three decades have not been impressive calling upon government to devise solutions to deal with the problem.
“The population growth and the budget growth over the last three decades show there is a fundamental problem. We must now start to deal with population growth and I do not know whether this is the reason Parliament banned mini-skirts,” Mr Muhakanizi told the consultative meeting.

Mr Muhakanizi who was responding to questions regarding revenue collection from local governments warned that government should stop creation of more districts because every year, the national recurrent and the development expenditures are shrinking, yet the wage bill continues to grow thereby stagnating salaries of civil servants despite the government ban on recruitment of staff.

“We must stop creating new districts because these are good politically but there is no revenue in them. You must tell the professor of the next elections that this is very serious. I can even lose my job,” he told the conference.

About government projects and supplementary expenditure

At the same event, Mr Muhakanizi cited the Shs450 billion which the Ministry of Finance negotiated towards teachers’ salary increment which he said seems much but is a very minimal increment because every year, there is need to recruit new civil servants yet there are pressing priorities like the national census to determine the rate of population growth as well as the national identity card programme.

Uganda’s population is estimated at 37 million people with 80 per cent of the population below 18 years making the country among those with youngest population in the world. He said all accounting officers should understand their priorities and follow them because government is phasing out supplementary expenditure which has caused the collapse of many companies. “You find that people go and borrow money and by the time banks come to recover the money, they have not yet recovered and they end up closing business,” he said.

Census dilemma
Postponed twice: The country’s census has been postponed twice from August 2012 to August 2013 and is now scheduled for August since resources are now available.
Shs33b spent: Although the census has not taken place, at least Shs33.2 billion is said to have been spent between 2008/2009 and 2012/2013.
Addressing the media in Kampala last year, State Minister for Finance (Planning) Mr Matia Kasaija said the money was used in preparations, saying that the census is an exercise and not a one-day event.