Finance blames districts for delays in fund transfers

Mr Nelson Koroo (2nd right), the principal financial analyst at Ministry of Finance, and officials from Uganda Revenue Authority address the media during a regional post-budget dialogue in Gulu City on Tuesday. PHOTO / TOBBIAS JOLLY OWINY. 

What you need to know:

  • Mr Nelson Koroo, the principal financial analyst at the Ministry of Finance, said in an interview on the sidelines of the regional post-budget dialogue in Gulu City on Tuesday, that the local government leaders are to blame for the delays and mess because they are reportedly not following the system protocol.

A senior official at the Ministry of Finance, Planning and Economic Development has blamed the discrepancies in the transfer of funds to local government administration units under the Integrated Financial Management System (IFMS) on the district technocrats.

Mr Nelson Koroo, the principal financial analyst at the Ministry of Finance, said in an interview on the sidelines of the regional post-budget dialogue in Gulu City on Tuesday, that the local government leaders are to blame for the delays and mess because they are reportedly not following the system protocol.

He said a district, municipal or city authority must meet some preconditions, including submission of a warrant of funds to indicate how and where the money will be used.

 “Many local governments transfer and request for this money but they don’t produce warrants and that causes the delays. When these delays come, they start to blame the Ministry of Finance. Without warrants, the Ministry of Finance cannot disburse this money,” Mr Koroo said.

“So, the responsible officers in local governments should take responsibility to do the needful on time. As they transfer, they must prepare the warrants for approval at the same time in the system,” he said.

Recently, the ministry introduced the IFMS, an IT-based budgeting and accounting system that manages spending, payment processing, budgeting and reporting for governments and other entities.

The system has in the past year faced a lot of criticism from local government administration units across the country over delayed remittances of funds to finance development plans.

For example, for the past five months, Gulu City Council has been grappling with a severe shortage of funds to manage waste within the city following delayed remittances of funds by the government under IFMS.

Mr Okwonga, the Gulu City mayor, said they have gone for several months without receiving funding from the Ministry of Finance to fund different activities.

Whereas the collection of the garbage is entirely dependent on local revenue generated, Mr Okwonga said at the moment, the generated revenue takes too long to be remitted back to them under the IFMS system.

 “We have been finding a very big challenge in the management of these wastes because the Ministry of Finance takes a longer period to approve the requests for funds,” Mr Okwonga said.

To manage the delays, Mr Koroo added that the ministry has redesigned the system to allow local government units to receive the funds weekly instead of quarterly. “This money will be disbursed back to local governments every week and, therefore, the responsibility now lies with the respective local governments to also make the necessary procedures and steps for getting this money within one week,” he said.

In March, a section of Gulu City and division councillors petitioned President Museveni over failure by the Finance ministry to remit to the city accounts operational funds for the past six months.

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