By THE OBSERVER UG
The Ministry of Finance, Planning, and Economic Development (MOFPED) has issued directives to government statutory bodies, urging them to give precedence to their expenditures, notwithstanding the constitutional freedom they possess to allocate funds at their discretion.
This directive follows recent public backlash over the procurement of high-end vehicles for former speakers of parliament, despite ongoing challenges in meeting other government obligations such as salaries, wages, arrears, and various projects.
Ramathan Ggoobi, the Permanent Secretary and Secretary to the Treasury (PSST), emphasized that while the constitution affords these institutions autonomy, they are now expected to align their spending with the government’s priorities. He made these remarks during a presentation on the highlights of the Q3 expenditure releases and an update on the state of the economy.
Ggoobi clarified, “These priorities encompass allocations for statutory votes, including parliament and the judiciary. These bodies receive funding, and as per the law, they determine how to allocate these funds based on their prioritization. Recently, there were discussions about certain vehicles being provided to individuals, leading to the perception that the government is not adhering to its commitment of not purchasing vehicles. However, it’s crucial to note that these vehicles were for statutory institutions, reflecting their budgetary priorities. Nevertheless, we are now advocating for even statutory institutions to align their priorities in accordance with the government’s overarching goals.”
He further stated, “This includes expenditures on areas like foreign and domestic travel—prioritize them. In essence, allocate funds exclusively to critical needs. Postpone those expenses that can be deferred and ensure cost-effectiveness, especially when engaging with private contractors partnering with the government.”
The PSST also emphasized that this approach aims to alleviate the need for supplementary budgets, a source of public discontent over the government’s spending practices amid declining resources. In justifying both the expenditures and the measures taken to manage supplementary budgets, Ggoobi disclosed that he intervened to block requests amounting to Shs 3.5 trillion from various ministries, departments, and agencies.
In December of the previous year, parliament sanctioned a supplementary budget of approximately Shs 3.5 trillion for diverse activities, encompassing the settlement of a Bank of Uganda debt, arrangements for hosting the Non-Aligned Movement (NAM) and G77+China summits, funding for the upcoming national population census, and classified expenditures for the Office of the President, among other allocations.
In response to concerns about the Ministry of Lands, Housing, and Urban Development being granted supplementary land compensation for three cultural institutions, which some believed could be deferred, Ggoobi clarified that certain items fell into four categories that couldn’t be postponed until the next fiscal year. He illustrated his point by highlighting security and classified expenditures, asserting that such matters are not subject to debate.
“Security is non-negotiable. When those responsible for security highlight threats to the country, immediate action is imperative. You can’t delay addressing issues like terrorists burning children in schools just to attend to other matters. I’ve heard debates from some acquaintances questioning whether these situations warrant supplementary budgets, asking, ‘Couldn’t it wait?’ I would like to address those concerns within the context of the four categories I previously outlined. However, this does not imply that we have haphazardly approved supplementary budgets. In my office, I intercepted requests for supplementaries amounting to Shs 3.65 trillion. I provided the internal auditor general with a stack of these requests recently, without even allowing my staff to review them,” stated Ggoobi.
Julius Mukunda, the Chief Executive Officer of the Civil Society Budget Advocacy Group (CSBAG), raised concerns about certain items in the supplementary budget that he believes should not have been included. He questioned, for instance, why the government had to incorporate expenses for two international meetings that had been known about for over two years and could have been adequately planned for.
Mukunda urged the ministry to impose stricter measures on government agencies to plan for major and even periodic events, such as the national census, which he deemed not an emergency warranting a supplementary budget. Nonetheless, he commended the ministry for providing a comprehensive explanation of the reasons behind additional funding requests during the implementation process.
“The detailed explanation about supplementary budgets, especially concerning revoting and parliamentary actions, sometimes leads to these allocations requiring approval levels that necessitate a supplementary budget. However, we need to pose a fundamental question about why some of these activities are not initially included in the budget. For instance, we are aware that the Non-Aligned Movement (NAM) was approved two years ago, and it required a supplementary budget now. Similarly, the Uganda Bureau of Statistics had a plan to conduct a census, so why did it need a supplementary budget? We believe that if the Ministry of Finance could enforce greater discipline on these agencies and strategically guide ministries on budget allocations, it would prevent oversights in critical areas such as population counting. Therefore, we strongly advocate for the Ministry of Finance to reassume a guiding role for these ministries,” remarked Mukunda.
In response, Ggoobi explained that certain projects were too extensive to be accommodated within the confines of the annual budget, necessitating either borrowing or seeking supplementary funds. He emphasized that the government would consistently align spending with available resources, requiring the postponement of some pre-planned projects to prioritize current needs.
The PSST affirmed the government’s commitment to enhancing debt and expenditure management, particularly by augmenting revenue collection and focusing on targeted spending improvements.
“The government is dedicated to fiscal consolidation with three primary objectives: enhancing revenue collection, rationalizing government expenditure, and exercising control over government borrowing,” he declared.
Excluding debt, external financing, and local revenue, a sum of Shs 4.974 trillion was disbursed for the third quarter, spanning from January to the end of March. This brings the cumulative expenditure to Shs 19.921 trillion, constituting 78.9 percent of the planned budget of Shs 25.25 trillion.
However, when factoring in supplementary budgets, the overall figure rises to Shs 29 trillion, projected to be spent. Incorporating debt, external financing, and local revenue, the total disbursement for the third quarter amounts to Shs 14.617 trillion, culminating in a year-to-date total of Shs 45.747 trillion.
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