Monday November 29 2010

Why kyeyo, middle class must vote

  Dr Makubuya, Prof. Latigo and EC boss Eng Kiggundu

Dr Makubuya, Prof. Latigo and EC boss Eng Kiggundu 

By Allan Ssekamatte

Two categories of this country’s most productive citizens ought to vote in the February 2011 general elections if we are to have a government that is truly representative of national interests. Millions of Ugandans live in the Diaspora, and yet these men and women will not exercise their constitutional right to vote unless Parliament amends election laws between now and next February.

According to the World Bank Migration And Remittances Fact Book 2011, there are 757,000 Ugandans recorded as working outside their country of birth, remitting $773 million or Shs1.77 trillion annually. This means that ‘Nkuba Kyeyos’, as they are known, are easily one of our most productive group of people, sustaining a big number of households with their direct cash injections.

In all likelihood, the World Bank ignores the hordes of Ugandans who work in virgin markets like Southern Sudan. The corporate/working class, often referred to as the Middle Class, is the second category of productive Ugandans that must step up to the plate to help shape their country’s political, and therefore, economic fortunes. Reasons for failure to capture corporates in Uganda’s political process are the direct opposite of those for Nkuba Kyeyos.

Whereas there is no enabling law for Ugandans in the Diaspora to take part in polls, locally-based corporates deliberately choose to stay away on voting day. Yet these are citizens, approximated at about one third of the electorate, who not only contribute hefty sums of money to the national kitty through Pay As You Earn, Income Tax and Withholding Tax, they are the biggest organisers of domestic savings through their contributions to the National Social Security Fund.

Why wouldn’t people who contribute up to 16 per cent of all domestic taxes contribute to the political process? Ideally, the 450,000 formal sector employees who have accumulated Shs1 trillion in savings with the NSSF, should have a proactive interest in political happenings in this country, but do they? We shall examine this passivity in detail.

Key oversight
It is incomprehensible why such a large number of Ugandans are literally disenfranchised when our East African Community counterparts already have provisions which ensure their foreign-based nationals take part in polls. During last August’s presidential elections in Rwanda, and also in Kenya’s 2007 poll, their nationals who live here took part in their countries’ elections. Why not Uganda?

Electoral Commission spokesperson, Mr Willy Ochola, says the law does not allow foreign-based citizens to vote by proxy. “This is something we in the EC can’t understand. For us, we follow the law and parliamentarians have not sorted this issue out,” he told Uganda Decides.

But the government is adamant no one has raised the need for Ugandans in the Diaspora to vote. Minister of Justice and Constitutional Affairs, Khiddu Makubuya says this issue never came up during discussions on electoral reforms in Parliament.

“We amended the electoral law last year and I never saw this issue raised. Where were you? This is election time, I am afraid I cannot comment on this,” he told Uganda Decides.

However, Leader of the Opposition in Parliament, Prof. Ogenga Latigo says there is a deliberate ploy by government to ensure Nkuba Kyeyos do not vote because the government is very unpopular abroad.

“We as the opposition have made it clear that since Rwanda allows its foreign based citizens to vote and Ugandans in the Diaspora must be given citizenship and the right to vote,” Prof. Latigo says. “The burden of coming out with a law that has big financial implications is with the government. As much as we would desire it, the NRM government thinks it is unpopular and can’t promote this law.”

Voter apathy
Despite paying up to Shs700 billion annually in PAYE alone, Uganda’s middle class is appallingly inert when it comes to advocacy for democracy, accountability and individual rights.

A punishing tax regime means formal sector employees, who are only 4 per cent of the working population, are serious stakeholders in this nation. Unfortunately, this class of people rarely expresses their dissatisfaction about potholes, corruption, child sacrifice, poor social service delivery and other cancers eating away at society.

Their most cardinal sin is, however, committed at election time when none of them offer themselves for leadership positions. You hardly ever hear of any successful private sector managers quitting their jobs to contest for elective office.

Worse still, this class never casts its ballot on election day, preferring the safety of their gated, high wall-fenced homes. The void left by the refusal of competent people to vie for competitive offices has allowed self-seekers, ‘peasants in suits’, known criminals and their ilk to dominate Parliament and regional assemblies.

Failure of the middle class to assert themselves has allowed today’s political players to ignore their interests. But properly organised, this group should be able to press for a scrapping of a retrogressive tax regime that deprives them of their disposable income, leading to a low savings, a poor investment culture and an ever-contracting job creation capacity.

For example, if PAYE were scrapped, the Shs700 billion this class pays, which largely ends up being misappropriated, could do wonders for the economy. For as policy analyst Mr Morrison Rwakakamba correctly argues: “Taxes should not be levied on wages because a wage is a just reward on time, not a profit. We shouldn’t be stuck in inhibitive taxation that limits economic transformation, productivity and consumption.”

Some presidential candidates have suggested that the PAYE threshold be raised from the present Shs130,000 to Shs500,000 and the percentage of taxation lowered from 30 per cent, but Mr Rwakakamba is for the complete scrapping of the tax. “Scrapping PAYE would allow government to collect more revenue, increase productivity, create more jobs, spur economic growth and guarantee Gross Domestic Happiness,” he says.

The Uganda National Chamber of Commerce and Industry secretary general says there is already multiple taxation of a class that also pays Local Service Tax, Energy Tax and Value Added Tax on most consumables.
The middle class also ought to be tying their votes to reforms in the pensions sector. Their savings must cease to be a cash cow for the high and mighty.

Reforms bringing down beneficiaries’ age from 55 (one year older than life expectancy), opening the sector to competition, allowing beneficiaries to use their savings as collateral are genuine campaign issues that can only be addressed if this class of citizens sit up to be noticed.