Why Tooro, Rwenzori failed to utilise Shs39b

At least eight districts in the two sub-regions of Tooro and Rwenzori failed to utilise a total of Shs39.87 billion from their approved budgets. 

The districts include Kabarole, Kyenjojo, Kamwenge, Kyegwegwa and Kitagwenda in Tooro Sub-region.  Others are Kasese, Bundibugyo and Ntoroko in Rwenzori Sub-region. 

The development is highlighted in the Auditor General’s (AG) report for the concluded Financial Year 2022/2023. This has resulted in the denial of much-needed services for people as some of the intended projects remain incomplete.

The funds were allocated for various projects and salaries. Unfortunately, due to the failure to utilise resources, all unspent money was returned to the Treasury.

Additionally, the report shows a shortfall in the approved budgets of these districts, which further hampered service delivery.

Failure to use the money
The district’s accounting officers Monitor talked to said one contributing factor to the failure to absorb the funds is the late release of the money by the Ministry of Finance.

The officials said the money was released towards the end of the financial year around May and June, which makes it challenging for them to fully utilise it within the given time frame.

The president of the Uganda Local Government Association (ULGA), Mr Richard Rwabuhinga, expressed concern over the impact of returned funds on projects, particularly affecting the construction of schools and health facilities not only in Rwenzori and Tooro sub-regions but also in other districts across the country.
He attributed the delays and incomplete status of many projects to the central government’s delay in releasing the funds and the government’s takeover of the procurement process for hybrid projects (schools and health facilities).

“As ULGA leaders, in July last year, we engaged the Prime Minister, who then took the matter up with the Cabinet to ensure all funds returned to the Treasury are re-voted to each district, and in October, the districts received the money,” he explained.

“This time, there is no reason for the districts to return funds. However, our concern is with the money allocated for wages. We have not been granted permission to recruit staff,” he explained.

The report shows that the unabsorbed funds in the district budgets were meant for crucial expenditures such as salaries, construction of seed schools, upgrades of health facilities, and implementation of micro-irrigation projects.

In Kabarole District, during FY2022/2023, the total approved budget was Shs32.8b, of which Shs32.2b was received. By the end of the financial year, the district had utilised Shs26.96b, leaving Shs5.26b unused.

The report indicates that out of the unutilised funds, Shs5.226b was allocated for various purposes, including agro industrialisation (Shs547.5m), development plan implementation (Shs89.6m), governance and security (Shs333.7m), and human capital development (Shs3.9b), which includes projects like the construction of the Uganda Intergovernmental Fiscal Transfers (UGIFT) projects such as Kichwamba Seed School, upgrading of health facilities, and salaries for secondary and primary school staff.

The district accounting officer explained that despite their efforts to utilise the funds as budgeted, circumstances were beyond their control.

In Ntoroko District, despite an approved budget of Shs27.7b, only Shs26.7b was disbursed, and by the end of the financial year, only Shs20.1b was utilised, leaving Shs6.6b unspent. 

Notably, out of the unspent funds, Shs2.66b was allocated for critical projects such as the construction of two seed schools and wages for Primary Health Care staff, significantly impacting education and health service delivery.

Similarly, in Bundibugyo District, although an approved budget of Shs48.3b was in place, only Shs46.8b was disbursed, resulting in a shortfall of Shs1.4b. 

However, of the funds received, Shs43.34bb was utilised, leaving Shs3.5b unspent. This affected vital projects like the construction of Kyondo Health Centre III and the completion of health centres under UGIFT projects.
The district accounting officer attributed the underutilisation of funds to delays in releasing the money and contractors failing to complete contracted works on time.

In Kamwenge, despite an approved budget of Shs68.4b, only Shs59.5b was allocated, leaving a shortfall of Shs8b. Out of this allocated amount, the district managed to utilise Shs55.4b, leaving Shs4.1b unspent.

The AG’s report highlighted that due to the failure to fully utilise resources, several projects under the Uganda Support to Municipal Infrastructure Development-Additional Financing (USMID-AF), budgeted at Shs1.03b, including construction initiatives, suffered due to delays in the procurement process. Additionally, there was a failure to procure irrigation equipment for farmers, a budgeted expense amounting to Shs740m, and delays in staff recruitment, among other issues.

The accounting officer explained that as a result, planned activities were rolled over to the subsequent FY2023/2024 for implementation.

In Kitagwenda District, despite an approved budget of Shs27.08b, only Shs25.8b was disbursed, indicating a shortfall of Shs1.2b. However, out of the allocated funds, only Shs19.9b was utilised by the district, leaving Shs5.9b unspent. The failure to utilise these funds affected various planned activities, notably Shs935.4m earmarked for micro-irrigation.

In Kyegegwa District, despite an approved budget of Shs56.5b, only Shs46.2b was disbursed, leaving a significant shortfall of Shs10.3b. Out of the Shs46.2b received, Shs43.7b was utilised, leaving Shs2.5b unspent.

In Kyenjojo, despite an approved budget of Shs56.47b, only Shs53.8b was disbursed. This budget shortfall significantly impacted planned activities, particularly in micro-irrigation, where delays in equipment installation occurred, and road maintenance and bridge construction were deferred.

Out of the Shs53.8b released to the district, Shs49.1b was utilised, leaving Shs4.66b unspent. This underutilisation adversely affected the implementation of micro-irrigation projects, which were allocated Shs1.7b but faced delays due to insufficient funds. Similarly, planned projects under human capital development, budgeted at Shs2.7b, such as the construction of the Kigaarare Seed School, were hindered by delayed fund releases, impacting the procurement process.

Furthermore, critical infrastructure projects like the construction of Kasamba Health Centre III were not implemented, negatively affecting health service delivery in the district.

Kasese District had an approved budget of Shs111.12b but Shs97.3b was sent to the district. At the end of the financial year, the district had utilised Shs90.04b while Shs7.35b was not utilised.

Govt allocations- Tooro Sub-region

District    Amount received    Amount returned
Kabarole    Shs32.2b     Shs5.26b 
Kyenjojo    Shs53.8b     Shs4.66b
Kamwenge    Shs59.5b    Shs4.1b
Kyegegwa    Shs46.2b    Shs2.5b
Kitagwenda    Shs25.8b    Shs5.9b
Rwenzori sub-region 
Kasese     Shs97.3b    Shs7.35b 
Bundibugyo    Shs46.8b    Shs3.5b
Ntoroko    Shs26.7b    Shs6.6b