Museveni asks MPs to support mergers

President Museveni has rallied National Resistance Movement (NRM) Members of Parliament to support the merging and rationalisation of government agencies, saying this will save the government billions of shillings.
According to a statement from State House, Mr Museveni met the NRM Parliamentary Caucus on August 19 at Kololo Ceremonial Grounds where he said only profit-making parastatals should be spared.

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Citing an example of the National Enterprise Corporation (NEC), the commercial arm of the Uganda People’s Defence Force, Mr Museveni said apart from research institutions, and farmers’ institutions, the government is seeking to retain only money-making parastatals.

“If the government wants to have parastatals, have money-making parastatals, so that when you say you have got a board, it is a money-making board; not a money-eating board. Have no board where there is no money making,” he said.

The most recent Auditor General’s report indicated that only 13 out of the 26 public corporation and state enterprises analysed made profits. Some included Uganda Electricity Transmission Company Ltd (UETCL), Uganda Electricity Generation Company Ltd (UEGCL) and National Water and Sewerage Corporation (NWSC) which posted profits of Shs112 billion, Shs91.9 billion and Shs47.8 billion respectively. These, however, were not paying any dividends to the government.

The Public Service ministry in 2018 released plans to realign government ministries, departments and agencies (MDAs) to address challenges of duplication of work, overlaps of mandates, conflicts, and wasteful expenditures, among others.

In February 2021, Cabinet approved a roadmap for rationalisation of government agencies, commissions, authorities and public enterprises.

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Mr Museveni’s impromptu meeting with the legislators comes two months after the House, through a report by an Ad Hoc Committee, raised concern about the impact of the proposed rationalisation of government agencies, urging the ministry to protect employees whose agencies have been affected.
Parliament, where NRM has majority seats, criticised the ministry for reportedly embarking on the mergers without a comprehensive study of the whole government machinery for service delivery, limited consultation on the legal and economic costs involved, and without a business continuity assurance study.

Parliament had given Mr Muruli Mukasa, the Public Service minister, two months to revert with a better plan.
Mr Museveni on Friday, however, made a case for the proposed mergers whose aim the government says is to save the country billions of shillings.

“The total cost savings arising from the rationalisation of 53 government agencies and functions per annum will be Shs649b,” Ms Mary Grace Mugasa, the junior Public Service minister, revealed, adding that the money to be saved includes savings from expenses on wage, facilitation of governing boards and councils, NSSF contributions, non-wage expenses, development expenditure, gratuity and rent.
Ms  Mugasa explained that out of 157 government agencies, which were reviewed in 2018, the government took a decision to retain 88 and merge, mainstream and transfer the functions of 69 agencies.

The first phase of the rationalisation exercise has been concluded with 53 out of the 69 government agencies harmonised while the 16 will be rationalised in phase two of the next financial year.
She argued that some of the agencies were created without clear justification, while others had their mandates overtaken by events.

“There are agencies that naturally should not be affected like Bank of Uganda, Mulago hospital, Micro Finance Support Centre, Uganda Development Bank, [and] Uganda Revenue Authority, [among others],” Mr Paul Omara (Otuuke County) said, adding, “The President is now accelerating because, in his view, the money is not available… This makes economic sense. For instance, UNRA, apart from just doing procurement and then passing money to the contractors, there is no value for money that they add. This can be handled as a department under the ministry of works.”

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Whereas the government indicates that billions of shillings will be saved, Mr Godfrey Wakooli (Butiru County) says emphasis should be placed on where such saving will be.

“I feel this should not stop there, but there should be a follow up on these monies that they are planning to save,” Mr Wakooli said, adding, “During Covid, a lot of money meant for meetings was saved, but we were not told where the money went,”

The lawmaker also demands that a further audit be conducted to put a figure to the money that government would save by collapsing so-called superfluous agencies.

Mr Hamson Obua, the newly appointed government chief whip, indicated that the processes will be undertaken in a phased manner. He also revealed that the Attorney General, Mr Kiryowa Kiwanuka, has since been tasked to embark on a constitutional amendment process to repeal Acts of Parliament that created the said institutions.