Government blocks sale of its assets in new cities

Saturday May 30 2020

Local government minister Raphael Magezi (2nd

Local government minister Raphael Magezi (2nd left) launches the COVID-19 impact report in Gulu town on Thursday. PHOTO BY TOBBIAS JOLLY OWINY. 


Government has ordered for immediate halting of sale, lease and exchange of land, buildings and other assets of the Local Government in municipalities that have been elevated to cities, and those yet to earn city status.

The order was made by Local Government minister Raphael Magyezi in Gulu Town on Thursday while presiding over the launch of a report on the impact of Covid-19 on Local Government fiscal space and service delivery in Uganda.

Mr Magyezi’s orders followed a suggestion by Mr Majid Batambuze, the chairperson of Urban Authorities Association of Uganda (UAAU) that the new cities should be allowed to take over district assets currently situated within the city areas.

However, Mr Magyezi said several attempts were being made by district and municipality authorities in the proposed cities to maliciously sell off land and buildings since it would be overtaken by the cities.

“I am issuing this directive to halt the sale, lease or exchange of any land, building or assets of the Local Government in any part of Uganda, especially in areas that have become cities. This thing of saying the city will throw you away and the municipality has to quickly do something on the buildings, we shall not allow it,” he said.

He added: “Don’t come to me asking to sell this land or buildings because we need land, we are going to need buildings to operate as cities. Imagine if our predecessors sold this land and buildings, where would we have built these municipalities that have now become cities?”


Mr Magyezi said his ministry is currently consulting with that of Education and Sports on a proposal to see that each of the new cities builds a modern stadium and that will require land and space in possession of the city authorities.

“Some districts and municipalities have already approached the ministry seeking permission to sell or lease properties within areas to be annexed into the new cities.”

For a Local Government entity to sell off or lease any of its assets, it requires permission from the Finance ministry upon consulting with that of Local Government.

UAAU wants the government to allow the new cities to take over assets belonging to districts and municipalities that are found within the new city areas.

“There is poised to be a lot of conflict over properties once these cities begin to operate and the ministry (Local Government) should intervene. The new cities should be allowed to take over these properties because they all belong to the same government,” Mr Batambuze said.

Covid-19 impact report
While issuing the Impact of the COVID-19 on Local Government Fiscal Space and Service Delivery in Uganda report, Dr Jennifer Bukokhe, the deputy Head of Office at the United Nations Capital Development Fund, said the pandemic had grossly impacted on Gocal Governments since March.

“The Covid-19 pandemic has disrupted social and economic structures, especially the Local Government systems of service delivery with significant consequences on health, livelihoods and general economic development,” Dr Bukokhe said.

Based on the modelling of the Local Government fiscal space, the total fiscal gap is projected at Shs15.7 trillion, with district governments being most seriously affected and accounting for 88 per cent of the total loss, she added.

Dr Bukokhe said Local Governments are likely to lose about Shs180 billion in local revenue collections and for the case of urban Local Governments that rely more on own revenues, the total fiscal loss of own revenues is estimated at five to 10 per cent.

The study was designed and conducted by the United Nations Capital Development Fund (UNCDF) and the College of Business and Management Science of Makerere University (COBAMS).

The report recommends that government must urgently create adequate fiscal space for Local Governments to be able to implement emergency response measures, ensure continued delivery of basic services