The assumption is that when the economy grows, we shall have more jobs, production, taxable incomes, greater effective demand and markets, as there are more people earning a salary
What went wrong? Why is it that Uganda today just cannot pay its public servants a decent wage after so many years of sustained economic growth averaging about 6 per cent per annum? Why is the government struggling after all the years of peace and security that have created a conducive environment for foreign investors to pour money into the economy and expand the opportunities?
Increasingly, the number of strikes and threats of strikes by public servants because of low pay and poor working conditions is becoming the order of the day. Lately, State Prosecutors and medical doctors have taken the course of industrial action. This, after university lecturers and non-academic staff in some institutions of higher learning dragged their feet back to work after cowing due to threats of the sack if they remained adamant.
Why is it that Uganda today just cannot pay its public servants a decent wage after so many years of sustained economic growth averaging about 6 per cent per annum? Why is the government struggling after all the years of peace and security that have created a conducive environment for foreign investors to pour money into the economy and expand the opportunities?
Why do we seem to be stuck yet bilateral and multilateral donors have been very generous towards Uganda because of its ‘sound macroeconomic policies’ and stability over the years?
The answer to these issues lies in the misguided economic trajectory that Uganda and many other African countries have adopted over the last three decades. There is overwhelming excitement about good economic growth (figures) over everything else.
The assumption is that when the economy grows, we shall have more jobs, production, taxable incomes, greater effective demand and markets, as there are more people earning a salary, etc.
To achieve those figures, we have taken to excessive borrowing, many times pushed by the so-called ‘development partners.’ But borrowing does not come cheap because lenders, even the ‘good Chinese’, are not the legendary mother goose that fends for its young ones. They are into lending for a profit, as a business.
Now Uganda’s external and domestic debt is about $8.7 billion. The National Budget Framework Paper 2016/17 indicated that Uganda will pay interest on debt to the tune of Shs2 trillion up from Shs1.65 trillion in the 2015/16 financial year, which represents a rise of Shs350 billion.
In other words, as loans grow the economy, we in turn pay out a lot in interest and other obligations.
Also consider this: When we are lent money to build roads and bridges, the assumptions are that it will ease farmers and traders to get their produce to the market. But we have not invested as heavily in the farms (farmers) to be assured of produce.
So you end up paying interest for funds acquired to build a road yet people are drying cassava and ground nuts on it. When we borrow to build dams, we hope that the electricity will help increase manufacturing, but we do not address issues such as access to cheap loans for the industrialist to help them to afford increasing their output.
The good hospital we build without diagnostic equipment and well paid health workers cannot help in increasing productivity because they do not keep people in a healthy state to enable them work. Yet we have to repay the loans with interest.
Consequently, we pay interest on the loan, which did not effectively act as a catalyst for greater growth. We have to resort to taxing the people to pay interest and not to finance further growth and development.
We are like the man who instead of painfully relying on his savings, borrows to build a house. He then has to borrow to furnish the house and he is indebted for the rest of his life paying interest. Most of his earnings go back to the lender so he struggles to address issues like his own welfare and up keep.
The public workers in Uganda find themselves in this position. The government will first service the loan with interest. It then factors in what is stolen and wasted. Then it has to ensure that it stays in power by sorting out patronage networks and readying the coercive arms of the State.
That is when the public servants will be thought about.
Heard about the Nyama Nyama revolution?
Deep in the annals of the history of strikes by medical workers in Uganda, there is a very peculiar tale. Some years ago, intern doctors plying their trade in a medical facility run by missionaries somewhere in northern Uganda, one time put down their stethoscopes and surgical blades.
The cause of their discontent was not these lofty issues like low pay, long hours, and lack of equipment and so on. Their demand was that the hospital’s management was being so stingy and inconsiderate; that it was deliberately excluding meat (Nyama) from the toiling doctors’ diet. Some of the naughty interns, who are now mature responsible doctors, called it the ‘Nyama, Nyama’ revolution (possibly after the Maji Maji revolution of 1905-1907.)
Animal protein derived from eating meat is very essential for healthy well-built and energised bodies, so the strike was justified. Now the ring leader of that strike sits high up in the clouds and no longer makes rounds in the wards. The person (yes that one, not the other one) is now close to the people who are even closer to the ones who are ordering, threating and barking at the striking doctors to abandon this “illegal” activity and go back to work immediately!
Mr Sengoba is a commentator on political and social