Experts urge caution as rationalisation beckons

Public sector reform experts are urging caution in the handling of the ongoing processes of rationalisation of government agencies and public expenditure (Rapex). They say this is so as to avoid pitfalls that could undermine the intended goal(s), undo gains made, and possibly plunge the country into legal and fiscal troubles.  

After years of back and forth, the long touted and awaited Rapex saw a step forward on Tuesday when the government tabled multiple Bills to set off the process. House committees are currently working in overdrive after Speaker Anita Among gave a three-day turnaround time and halted all other business. Reports are expected in the House on Tuesday for debate and possible enactment of the Acts.

The ambitious goal to thin public sector administration, and save north of Shs1 trillion—nearly 1.9 percent of the budget—has been on the government’s and by extension President Museveni’s to-do list since the idea was birthed in 2018.

“The high cost of administering the agencies has drained the national Treasury at the expense of effective service delivery. This has overstretched the capacity of government to sustain them.

Government has also established that the generous salary structures of the agencies has created salary disparities between employees of the agencies and public officers in the traditional civil service leading to demotivation of human resources in the mainstream public service,” justification by the government for the rationalisation in the Bills reads in part.

The government, according to plans of 2021, wants to retain 80 of its 157 agencies, have the mandate of 33 reverted to line ministries, and 35 merged into 19 entities.

Key agencies, including the Uganda National Roads Authority (Unra), Coffee Development Authority, National Agricultural Advisory Services, and Equal Opportunities Commission, will be abolished per the Bills tabled. Others are Uganda Wildlife Conservation Education Centre (merged with UWA), Uganda National Meteorological Authority, National Forestry Authority, among others.

Caution is the byword
Dr Brian Sserunjogi, a research fellow at Makerere University’s Economic Policy Research Centre (EPRC), says the move is well intentioned as the government’s fiscal space shrinks. But concerns abound that unless the government’s financial discipline is addressed, the trillion saved may be like collecting water in a basket.

Dr Sserunjogi further urges that reduction of the cost of administration should also extend to the political side.

“It has to be comprehensive. Why should it be only technocratic rationalisation? If you look at the public sector administration, there needs to be a balance between the political and technocratic. The size of Parliament, for example. Government has to strike a delicate balance between the political and technocrats,” he said.

Also top of his concerns is how the rationalisation will affect service delivery.
“If you look at the mainstream public service, and the agencies, where was more efficiency? Is the main public service now heavily incentivised to push service delivery in this country? You have to motivate them,” he told Sunday Monitor. “Some of these were created to address bureaucracy while others were pushed by donors. If part of your Budget is still being financed by donors, and donors want efficiency, have they thought about that?”

Anyone’s call
Prof Ezra Suruma, an economist and former Finance Minister, said rationalisation “needs to be approached more carefully in regard to not compromising institutions that are vital to the wellbeing of Uganda.” He for one noted that “the Coffee Development Authority was put in place to liberalise coffee exports and ensure high quality and to do research. As you can see, coffee exports have gone up. Is there a justification to rationalise it?

He added: “The abolition of the Produce Marketing Board was a disaster for Uganda. All these things, aflatoxins, maize quality were being managed by the Board.”

According to the Bill collapsing the Authority, its functions are to be mainstreamed into the Ministry of Agriculture that will “regulate, promote and oversee the coffee sub-sector; to provide for the ministry responsible for agriculture to regulate all on farm and off-farm activities in the coffee value chain; to provide for a coffee auction system; and for other related matters”.

Mr Julius Mukunda, the executive director of Civil Society Budget Advocacy Group (CSBAG), also worries that the process may be used to do away with critical mandates and responsibilities.
 “Much as we want the mergers, if we mishandle the process, then we will not get the benefits we want. If you rush the process, you may create loopholes that a smart lawyer will go to court and throw the whole thing out,” he said.

There was a push and pull in the House on Tuesday when the Bills were tabled, with a section of legislators concerned that too little time was accorded to the processing of the Bills. Speaker Among insisted consultations with stakeholders will be done.

“This is a government programme and there have been back and forth engagements. As an institution we are busy going about with our mandate until advised otherwise,” Mr Allan Ssempebwa, Unra spokesperson, one of the dissolved agencies, said.

Compensation
There are also fears that government’s position not to compensate workers set to lose their jobs to mergers will foment trouble. More than 2,000 people are expected to lose their jobs. Earlier in the process, the Public Service ministry had sought Shs70 billion to compensate those affected. In a twist of events, however, the Bills show there will be no compensation; only payment of a terminal benefit.

 “People losing work is not good. I read that people being merged are not going to be compensated. Won’t [the] government be sued, fined […] that will add onto arrears,” Dr Sserunjogi said.

Until recently, legal battles by individuals that were afflicted by the divestiture and privatisation of the 1990s have been ongoing.

On Thursday, lawmakers on the Legal and Parliamentary Affairs Committee halted scrutiny into part of the Bills before them. This was after they discovered that the certificate of financial implication issued by the Ministry of Finance did not show how the mergers and abolitions would affect government finances. The lawmakers led by the Kira Municipality’s Ibrahim Ssemujju Nganda reasoned that the certificate of financial implication that had been issued on the bills before the committee fell short of the specifications stated in Section 76 of the Public Finance Management Act [PFMA] 2015. The section demands that the financial gravity be defined.

“You see the framers of this law, even when you are winding down a parastatal, there will be costs. There are people you are compensating, there are domestic arrears to deal with, you simply can’t walk to Parliament and say there will be zero costs and tomorrow you present a budget […] The certificate before us is actually not a certificate under section 76 of the PFMA,” Mr Ssemujju said.

 Asuman Basalirwa, the Bugiri Municipality lawmaker, added: “When you look at what Section 76 is talking about, it even indicates the time, because the cost estimates and revenue after the bill has come into effect. So that in itself must be able to come out which with due respect isn’t indicated here.”

The legal and Parliamentary Affairs Committee is processing the Bills that will, among others, see the Equal Opportunities Commission merge with Uganda Human Rights Commission. Additionally, the Uganda Law Reform Commission is expected to be housed under the Ministry of Justice and Constitutional Affairs.

In defence, the Attorney General Kiryowa attempted to persuade the legislators to carry on the process reasoning that the issue raised had no legal implications, something the committee declined to heed.

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We want to ensure that some institutions that are a duplication can and should be merged, but we need to take into account the unemployment.

It is probably the most serious economic problem we are facing. What we need to be doing is expanding employment and not contra-cting.,’’ Prof Ezra Suruma, former Finance minister