Uganda should learn to live within its means

By Muhammed Ssempijja

The budget is around the corner and Ugandans are waiting anxiously for what the honourable Minister of Finance will unfold in her budget speech.

In 2012/13 budgeted government expenditure was sh11,157b. Sh8,368b (75%) was to be funded from domestic sources and the sh2,789b (25%) from donors.

A quick analysis of how the planned funds have come in indicates that on the domestic revenue portion, we are likely to perform fairly well as of end of April 2013. However, on the expected donor component, less than 10% is expected to be realised, according to the 2013/2014 budgetary framework paper.

The reason given by the donors for withdrawing much of the support was the issue of corruption.

Although the donors’ explanation is reasonable, we need to reflect on how the economies of these donor countries are performing.

One needs to be reminded that our major donors are Europeans and Americans, and they are not having anything near a good time in their home countries. Most European countries have been in recession for the past few years and the signs of getting out of it are not clear. The same is happening in the US.

Most donor countries have adopted austerity budgets – reducing expenditure even in critical areas such as education, health and public housing. Due to the severe contraction of the donor economies, acute unemployment has been the obvious result.

It is for this reason that Uganda needs to wake up and accept the reality that the funds expected from donors will not smoothly flow as they used to in good times.

The corruption issues have only given the donors a good excuse for not availing the promised funds.

Uganda’s budgetary solution lies in putting in place systems and processes that will prevent wastage of its meagre resources and maximise the use of the available resources in the most pressing areas such as health and agriculture.

Under the current system, it is clear the mechanisms to prevent public officers from dipping their hands in public funds are not working. Most findings are after the event when the Auditor General or Inspector General of Government bring to light the vice.

The Government should be the role model in teaching its citizens to spend within their means instead of relying on borrowing.

The issue of supplementary budget requests is another clear sign of budget indiscipline, which should stop if Uganda is to move to the next level.

In my view, Uganda has the capacity to sort out its budget issues, but this requires attitude change.

We should learn to deal with corruption, as well as spending within our means by not budgeting for money which we cannot generate.


The writer is the country managing partner of Ernst & Young Certified Public Accountants

muhammed.ssempijja@ug.ey.com