What you need to know:
The issue: Salaries
Our view: We urge responsible officials to wake up and smell the coffee. Expedite the creation of a Salary Review Commission and empower it to act judiciously.
Post budget engagements have been a great deal more cautious in the tone they have taken after Finance minister Matia Kasaija delivered his speech on June 14. A unifying strand—at least from the government of Uganda narratives—is the persistence in urging that short-term pain be endured to pave the way for long-term gain.
The breadth of issues to be addressed is of course daunting, especially since the pandemic and Russia-Ukraine war ensured that a terrible hand was inherited. Commodity shocks have consequently sparked inflation, dampening spending.
Yet the central bank’s demand side toolbox—and its snail-paced monetary policy—doesn’t have an immediate cure to the rapidly changing supply pressures. If anything, the tight monetary policy (increasing the central bank rate to 7.5 per cent) will further put a squeeze on spending as the cost of borrowing soars.
All of this makes the risk of fractious paralysis quite real. The government of Uganda and indeed the private sector find themselves facing calls for inflation-linked wage increases. Failure to act appropriately could precipitate a rolling wave of strikes over pay and conditions.
Already, the Uganda National Teachers Union (Unatu) has resoundingly rejected a presidential directive that ongoing industrial action over “discriminatory salary enhancements” be shelved. President Museveni ordered the non-science teachers back to class after they downed their tools thanks to a discrepancy being created between them and scientists on the government payroll.
The deadlock is testament to the government not only inheriting a terrible hand, but proceeding to play it badly. Unatu says that while signing the Collective Bargaining Agreement, as far back as 2018, it made clear that “discriminatory salary enhancements” would not be countenanced. Yet government functionaries—at the prompting of Mr Museveni—still proceeded to create the discrepancies that have proven to be toxic.
To compound matters, you have different arms of government—such as the legislature—that appear to have taken sadistic pleasure in ring-fencing different perks for themselves as others grapple with the soaring cost of living. This chaotic diversity of competing interests would no doubt have been smoothed out had the government of Uganda established a Salary Review Commission as envisaged under the Constitution. It has instead preferred to operate as if it is in the Wild West. Now the proverbial chickens appear to be coming home to roost.
Sadly, in coming months—weeks even—strikes over pay and conditions will become ubiquitous in Uganda. While a finger of blame can rightly be pointed at external factors, things wouldn’t be as fractious as they are had the directing hand of a Salary Review Commission been trusted. Lawmakers would certainly not have carte blanche to do what they recently did. The dichotomy of arts and science teachers would also not be as pronounced as it currently is. We urge responsible officials to wake up and smell the coffee. Expedite the creation of a Salary Review Commission and empower it to act judiciously.