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It is time the Government woke up and reduced the luxurious and wasteful expenditures it is incurring, Civil Society Budget Action Group (CSBAG) executive director Julius Mukunda has said.

“The budget cuts should be carefully done. It should have a criteria. It should affect medicines and wages. The cuts should affect donations, special meals, travel abroad, buying of new cars and furniture. They may cut in areas they are not benefitting from,” Mukunda says.

“Wasteful expenditure is not sustainable. If we keep getting loans and not using them in future we shall be budgeting to service loans. We have shillings 44 trillion in undisbursed loans. Our problem is poor implementation and poor efficiency in the implementation of projects which we need to improve,” Mukunda says.

He proposes that accounting officers who fail to implement projects should be replaced: “We have bright Ugandans who can take over the positions of accounting officers who are failing and incompetent”.

Corti Paul Lakuma, a senior research fellow and head of the macroeconomics department at the Economic Policy Research Centre (EPRC), says there has been budget cuts but the difference this time is it is preannounced. Lakuma adds that with the forewarning is to ensure that accounting officers can better prepare themselves. 

“During the COVID-19 period we had budget cuts of 20% to fund emergencies, adjustments in the budget are necessary if there is no money,” Lakuma said.

Lakuma said there should be wise decisions and context made on the purchase of vehicles. He argued it would not be wise to ban the purchase of new vehicles for judges who have to go to remote areas. Similarly, he said it is not wise to stop the purchase of ambulances.

He noted at the health ministry and health centres you might find good ambulances or vehicles packed because projects have ended.

“We should better negotiate projects so that when they end the vehicles can be used in other areas. Some donors want to see the project vehicles packed,” Lakuma said. 

The remarks were made during a telephone interview with New Vision Online on Tuesday, April 9, 2024.

Budget cuts announced

However, it should be noted that the Government has already announced budget cuts come next financial year.

The Uganda National Roads Authority (UNRA) and the ministries of energy, justice and works sit top on the list of Government’s ministries, departments and agencies (MDAs) whose budgets will be trimmed in the 2024/25 financial year, to a tune of sh2.7 trillion.

In a communique dated April 3, the Ministry of Finance Permanent Secretary and Secretary to the Treasury Ramathan Ggoobi informed accounting officers that the budget for UNRA will be trimmed bysh552.74b. The Ministry of Energy will suffer sh277.42 budget cut, works sh209.17b and justice sh104.54b.

“Due to the increase in debt service costs and reduction in budget support, the discretionary resource reduced by sh2.766 trillion,” said Ggoobi, adding that in order to fit within the resources available, Cabinet approved a downward adjustment of the budgets of MDAs.

The communique further says that additionally, the wage allocation and external financing has increased by sh159b and sh100.39b respectively.

Government has disclosed that it expects up to sh292.60b out of Non-Tax Revenue and URA additional funding, as well as sh124.83b as savings from rationalization of MDAs in the financial year 2024/25.

“The purpose of this letter is to inform you of the revised budget allocations and request you to make the necessary adjustments through the Corrigenda on the Programme Budgeting System (PBS), and submit not later than April 9, 2024.