New Museveni Sacco pledge raises funding queries
What you need to know:
- In the Sunday missive, Mr Museveni noted that the clusters of interest-groups that he singled out would have a district-wide Saccos network, with branches at convenient points preferably at parish level.
The money for a new initiative to bring more groups of citizens to benefit from government through Savings and Credit Cooperative Organisations (Saccos) that President Museveni announced on Sunday is not included in the 2019/20 national Budget, our analysis shows.
State House and Finance ministry officials were yesterday unable to state how much cash would be required to kick-start the process, where the money would be obtained from and which services would be affected in the event of internal budget re-allocations.
Senior presidential spokesperson Don Wanyama, without providing specifics, said the money will be found and what matters is for the prospective associations to register, submit proposals and receive funding.
“The Saccos will be registered and money will be sent to them. Technocrats at Finance and State House are working out modalities,” Mr Wanyama said.
“This [funding to associations] should start this Financial Year. You should not worry about the budget. A budget is an operating framework that can be adjusted,” he added.
Finance minister Matia Kasaija during the budget speech two months ago, only provided an additional Shs40b to Uganda Microfinance Support Centre that eligible Ugandans can borrow at no more than 12 per cent annum to invest in specific enterprises.
In the 12-page letter address, President Museveni named boda boda riders, women entrepreneurs, carpenters, salon and taxi operators and restaurant associations as target groups for the new Saccos financing regime.
“These sector-specific and district-wide Saccos may be better than the katogo (mixed grill) ones that were, moreover, numerous and not covering specific geographic areas,” Mr Museveni wrote, adding: “These myooga (sector-specific) Saccos will cover all the miscellaneous activities that are not agriculture.”
He did not specify whether the planned Saccos will be funded under State House or budgets of line ministries.
READ:
Museveni names associations to get government funding
Mr Museveni’s announcement of new funding proposals that will run alongside the Shs437.2bn annual funding to OWC, Women Fund, Youth Fund
The President pointed out that agriculture will continue to be covered under Operation Wealth Creation (OWC) and Uganda Development Bank (UDB).
Mr Jim Mugunga, the Finance ministry spokesperson, in response to inquiries from this newspaper, yesterday said they had read the President’s message and, as technocrats, they stand ready to implement it pending further guidance.
“We are aware that there are various initiatives already in place to address poverty. Most of the initiatives fall under the [different criteria],” he said, referring to other ongoing government poverty reduction programmes such as OWC that have clarified financial tag.
For example, a total of Shs437b has been allocated in this Financial Year budget for OWC, women, youth, micro-finance and Innovation funds.
“It’s not uncommon for new guidance to come through and, as a ministry, we act as expected. In this particular case, we shall await official communication and policy guidance on the matter,” Mr Mungunga said.
The plan
In the Sunday missive, Mr Museveni noted that the clusters of interest-groups that he singled out would have a district-wide Saccos network, with branches at convenient points preferably at parish level. The statement also recaps the essence of his three-month countrywide tour to popularise wealth creation at the household level through profit-based enterprise selection, commercialising production and avoiding land fragmentation.
