Parliament Committee Proposes 12 Percent Budget Increase

However, Shadow Finance minister Muwanga said Kivumbi says in his minority report: "For the budget committee to identify a huge funding gap of 6.1 trillion to be added to the already exaggerated Resource Envelope of 49.9 trillion Shillings without identifying the sources of revenue renders this exercise an academic trip of no particular practical import to the budget process.”
Parliament is scheduled to debate the proposed national budget framework paper next week.

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The Budget Committee of parliament has proposed an additional 6.1 trillion to the initial national budget estimate for next financial year, which will bring the figure to 56.1 trillion Shillings. 

The proposed additional funding is contained in the Budget Committee report on the National Budget Framework Paper for the next financial year 2023/2024. The report was presented to parliament on Wednesday by committee Vice Chairperson, Wamakuyu Mudimi.

Last year in December, Finance Minister Matia Kasaija tabled before parliament the proposed national budget for next financial year 2023/2024, projected at 49.98 trillion Shillings, compared to 48.13 trillion for the current financial year 2022/2023, reflecting an increase of 1.85 trillion.

Now according to the Budget Committee report, legislators recommend an additional allocation of 6.12 trillion Shillings to the total national budget to cater for unfunded or underfunded priorities in different government Ministries, Departments and Agencies.

The committee recommends 40.8 billion to the Inspectorate of Government (IG) to complete the construction of its Head Office; 192.64 billion to the Parliamentary Commission for non-wage recurrent shortfall, wage shortfall for MPs and staff, construction of the Chambers, procurement of vehicles and upgrade of the ICT infrastructure; 38.36 billion for Electoral Commission staff wage enhancement, women council elections and recruitments in newly created districts and others.

A total of 180 billion is recommended for the Ministry of Health for wage shortfalls, infrastructural gaps, renovation and equipping hospitals, upgrade of health centers, and blood donation mobilization; 177.3 billion for the Ministry of Education to reinstate budget cuts, recruitment of staff and training examiners; 44.7 billion for Office of the President for among others patriotism activities, procurement of medals for awards, and facilitation for newly recruited presidential ambassadors.

The committee also recommends an additional budget of 5.26 billion allocation to Ministry of Justice and Constitutional Affairs to enhance staff salary and to compensate war debt claimants in Teso, Acholi and Lango sub-regions for the loss of livestock and other properties during the insurgency; 14 billion for Directorate of Public Prosecution DPP's recruitment and promotion of staff; 1.9 billion for National Forestry Authority to re-survey and demarcate forest boundaries and provide tree seedlings.

However, a minority report authored by Shadow Minister for Finance, Muhammad Muwanga Kivumbi dissents with the majority budget committee report on the identified funding gap of 6.1 trillion since the source of funds is not identified.

“Government came up with the Resource Envelope showing the proposed sources of revenue in the Budget Framework Paper. For the budget committee to identify a huge funding gap of 6.1 trillion to be added to the already exaggerated Resource Envelope of 49.9 trillion Shillings without identifying the sources of revenue renders this exercise an academic trip of no particular practical import into the budget process,” said Kivumbi.

//Cue in: “to simply come…//

Cue out:…report is unrealistic.”//

Meanwhile, although the resource envelope for next financial year is proposed to increase by 1.85 trillion according to the Budget framework paper, government says that discretionary resource envelope reduced by 2.53 trillion from 25.4 trillion to 22. 86 trillion due to the projected increase in the interest obligations and obligation to settle Bank of Uganda borrowing.

In regard to aggregate expenditure composition, 32.05 trillion (64.1 percent) of the proposed budget is to cater for recurrent expenditures while only 17.92 trillion (35.9 percent) of total expenditure is to cater for development expenditures. Debt related payments, including domestic arrears represents 37.7 percent of total expenditure projections.

Wamakuyu says that the proposed resource prioritization is very worrying and could indicate that the country’s fiscal operations may not be sustainable in the long run as debt related payments continue to take the largest share of the budget.

The proposed 49.98 trillion national budget will be financed through domestic revenue equivalent to 28.83 trillion, budget support amounting to 2.491 trillion, domestic borrowing 1.585 trillion, external project support worth 8.04 trillion, domestic refinancing of 8.798 trillion, and local revenue for local government (AIA) of 238.5 billion Shillings.

The Budget theme has been maintained as “Full Monetization of the Ugandan Economy through Commercial Agriculture, Industrialization, Expanding and Broadening Services, Digital Transformation and Market Access”.

The government's key priorities for next financial year are starting the construction of the Standard Gauge Railway and finalization of the rehabilitation of the Meter Gauge Railway under the Integrated Transport programme (4.65 trillion); investing in small-scale solar-powered irrigation as well as addressing climate change and food security under Agro Industrialization Programme (1.499 trillion) and others.

The other priorities are constructing power service stations and transmission lines under the Sustainable Energy Development programme (ugx1.2 trillion) and capitalization of Uganda Development Bank -UDB and Uganda Development Corporation- UDC to continue supporting private sector development, recovery and economic transformation under the Private Sector Development (1.798 trillion). 


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