Friday June 13 2014

Inefficient implementing agents fail our budgeting performance

By Paul Walugembe

It is one day after the presentation of the 2014/15 National Budget by Finance, Maria Kiwanuka. All the major sectors of the economy, the business community and policy analysts not forgetting the funders of the Budget and the entire country are now eager to see the words and figures in her portfolio.

The Uganda’s economy has gradually grown into more than 10 sectors that is to say; the agricultural sector, the judicial sector, the informal sector, the business sector, the rural sector, minerals and oil sector, information communication technology sector, the energy sector, the education sector and transport. This implies that at least all these sectors, including their agencies, should utilise at least Shs2t of the budget.

The Ugandan budget allocation machinery attracts 100 per cent efficiency and progress every year but the budget gross performance controversially pulls down its performance to less than 50 per cent due to inefficiency and ineffectiveness of the agents of implementation (action machinery), time frame and evaluation.

The agents of implementation; the Government, gets its finances from taxes, fines, grants, donations and fees. The Uganda Revenue Authority (URA) has done its role very well ever since it was established after Parliament enacted a statute; article 153, section 2 in 1991. However, this semi-autonomous agency concentrates on only taxes.

It is soon becoming the Uganda Taxation Authority. The worst bit of the Government cash flow management comes with the fiscal policy. This sector is in a limbo. First, there is a lot of bureaucracy and red tape that delays resources at every stage of production within the Government management operations. It is further accompanied by the theft (corruption) and unrealistic accountability if there is any.

All Agents of Implementation work on a norm of deficit expenditure and theft. The Government has reached a stage where it needs to work towards achieving efficiency and surplus. In terms of time frame; the unimproved information systems, bureaucracy or red tape and untrustworthy agents, are the major fabrics for delays in all Government activities. They further necessitate higher expenditure when some tasks in a given project are done at a time rate.

Also, the agents of implementation’s leaders also make it hard for the citizens at the grass-roots to get the monetary equivalent of their services and/or suppliers. The grass-roots members have less room to appeal for a supplementary budget.

But who evaluates ministries, agencies, local Governments and all the agents of implementation? Within 12 months of Intensive work activities, the Media, the major sectors of the economy are taken-up by the distractions of other events of life. There are no financial reports that are followed by the Budget thus another year is ushered in.

The services of 35 million Ugandans are left into the hands of less than even 0.001 per cent to demand for accurate and genuine accountability. In his book, the Cash Flow Quadrant Robert T. Kiyosaki asserts that: “People are so optimistic that they can forget about a crisis that caused them severe effects within 12 years.” However, Ugandans forget about the causes of our Economic Retardation within a year.

The following are footnotes for efficiency and progress. First, the Planning is a task circle. All the policy and planning units are supposed to draw activities for the next year’s budget a year before otherwise we shall always be caught-up by time. Seventy five per cent of the elements of the next year’s budget should be covered by the Budgeting team in the third quarter of the year before that financial year.

Second, is transparency and accountability; Without genuine and accurate financial reports, the departmental performance reports will have an important element of financial resources performance missing.

Third, is monitoring and evaluation. There is a great need to monitor and assess the public finance and fiscal activities at all levels of implementation. Fourth, is the Role of URA. Despite its semi-autonomous nature, URA is still under the Ministry of Finance, Planning and Economic Development. It should always be advised otherwise whenever it goes astray. It should concentrate on revenue collection not taxes collection.

Paul Walugembe is a Financial Activist and CEO Pearl Paper Co. Ltd (PPC).