Govt reserves billions in public contracts for youth, women and PWDs

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The government has reserved billions of shillings in public contracts for local businesses, women, youth and persons with disabilities under a new procurement framework aimed at boosting domestic industry and creating jobs.

The policy, anchored in the 2021 amendment of the Public Procurement and Disposal of Public Assets (PPDA) Act, Cap 205, positions public procurement as a tool for economic transformation by strengthening local enterprises and promoting inclusive growth.

Launched last week during awareness workshops in Rukungiri District, Rukungiri Municipal Council and Kanungu District, the framework introduces targeted reservation schemes that earmark specific contract categories for special interest groups (SIGs) and Ugandan-owned enterprises, while limiting foreign competition in selected tenders within local governments and ministries, departments and agencies (MDAs).

"Government procurement should not only deliver goods and services but also support local industries, promote inclusive growth, and empower groups that have historically been excluded from economic opportunities," said Johnson Musinguzi, Acting Commissioner for Procurement Inspection and Coordination at the Ministry of Local Government.

Under the new rules, Procuring and Disposing Entities (PDEs) must reserve at least 15 per cent of their annual procurement budgets for enterprises owned by youth, women and persons with disabilities.

Contracts valued at sh30 million and below at the central government level, and sh10 million and below at the local government level, will be exclusively reserved for these groups.

To further ease access, qualifying firms will be exempt from bidding fees and may submit bid-securing declarations instead of bank-backed securities.

"These measures directly address the long-standing financial and bureaucratic barriers that have historically prevented vulnerable groups from competing effectively for government business," Musinguzi said.

To ensure the benefits reach the intended beneficiaries, the framework sets clear ownership criteria.

Women-owned enterprises must be at least 51 per cent owned, controlled and operated by Ugandan women aged 18 and above.

Youth-owned enterprises must be at least 51 per cent owned and led by Ugandans aged between 18 and 30 years, while enterprises owned by persons with disabilities must be controlled by individuals with recognised physical, mental or sensory impairments.

The policy also seeks to protect local firms from being edged out by multinational companies through a new three-tier classification system comprising national providers, resident providers and East African Community providers.

National providers are wholly Ugandan-owned companies, resident providers are entities registered in Uganda but not fully citizen-owned, while East African Community providers are firms or individuals that have operated within the region for at least 10 years.

With public procurement accounting for more than 60 per cent of local government budgets, Musinguzi described it as "one of the Government's most powerful tools for local economic development."

He urged alignment between procurement systems and national industrialisation programmes, including President Yoweri Museveni's industrial hubs initiative, which provides vocational skills to young people.

Community Development Officers have been tasked with registering and sensitising eligible groups, while procurement officers are expected to integrate the reservation schemes into upcoming procurement plans ahead of the next financial year.