Govt defends revised Shs52 trillion budget

A budget intended to correct errors of omission or commission initially made by Finance ministry officials has achieved the exact opposite, with lawmakers querying a Shs1 trillion increase.

The revisions in the budget known in finance parlance as a corrigenda budget saw Shs50.915 trillion  in the FY2023/2024 draft tabled in March shoot up to Shs51.919 trillion.

Mr Henry Musasizi attributed the upward revision to “additional Government of Uganda resources amounting to Shs254 billion to cater [to] treasury operations towards reducing government’s liability with the central bank.”

The junior Finance minister also cited an “increase in external financing of Shs716.671 billion and increase in the non-tax revenue for next financial year (FY) to Shs33.311 billion.”

The House Budget committee heard on Friday that the aforesaid non-tax revenue will be realised from collections to be made by the Uganda Wildlife Authority (UWA) in the next financial year.

Mr Musasizi said the collections were better than initially expected. A section of members on the Budget committee chaired by Mr Patrick Isiagi Opolot, were, however, worried that the government is not cutting its coat according to the cloth.

Mr Musasizi, who listed climate smart agriculture transformation (Shs338 billion), agriculture cluster development (Shs49 billion), GAVI funding (Shs119 billion), and Covid-19 response and emergency preparedness project (Shs285 billion) as beneficiaries of the budgetary adjustments, was quick to allay fears.

“We are starting to see that we have failed to fit the budget for some critical activities,” Mr Musasizi said, adding, “We want to make it clear [that] we shall also look deep into the budget where critical activities are not catered for, we shall see what to do.”

The Budget committee chair was unconvinced, and pointed to the continued failure to ring-fence money for local council elections as a sign of ineptitude.

“There are things that we should not underrate. In our laws, LCIs are very important persons,” Mr Isiagi opined, adding, “The other day they arrested the ministers. To get bail, LCI must be there. So if they arrest you tomorrow when there is no LCI you cannot get bail.”

Mr Musasizi reasoned that the government is “budgeting under difficult circumstances” that have forced it to stick to a pecking order.

Basing on that defence, committee members wondered why Covid-19 was being prioritised when it was no longer a public health emergency. To which the junior Finance minister offered information that the Covid-19 funds captured by the corrigenda budget are part of a grant earmarked to boost the country’s health system resilience.

The government was also faulted for carelessly drawing from the central bank’s reserves.

Mr Musasizi clarified that Bank of Uganda (BoU) merely advances the government money “specifically at the beginning of the financial year when we have not collected revenue to kick-start the activities in July.”

The junior Finance minister, however, revealed that the government holds a “negative Shs3 trillion balance” which it has “committed to settle in the next two [financial] years.”

To offset the aforesaid balance, the government has resolved “to pay about Shs1.2 trillion back to Bank of Uganda.”

Mr Isiagi did not pull any punches. He said: “We are very disappointed with your style of work. Government has wasted a lot of money in training because I am aware [that] you are highly qualified people. You are highly qualified, but you disappoint us.”

expectations

The lawmakers on the Budget committee are expected to retreat to a closed-door session to effect changes in the latest Shs51.9 trillion Budget ahead of a plenary session anticipated to be held on Tuesday. Once the fine print from the closed-door sessions is approved and passed by Parliament, the final budget of FY 2023/2024—slated for presentation to the entire country on June 14 at the Kololo Independence Grounds—will get the green light.