Ugandans gear up for 2012/13 budget

By John Odyek

Finance minister Maria Kiwanuka is set to present the 2012/13 national budget to Parliament later in the afternoon.

Each financial year, the finance minister performs the duty on behalf of the President. After the presentation of budget speech, the President reacts to it.

 MPs, donors, the private sector and NGO leaders will keenly listen to the budget speech at Serena Kampala Hotel.

This will be the second budget speech Kiwanuka reads as other East African Community finance ministers do the same.

Ramathan Ngobi, Uganda economics lecturer Makerere University Business said people will be keen to hear how the budget will affect them.

 “If the price of sugar, salt, paraffin, petrol, diesel goes up they will be concerned,” he said.  Ngobi expressed concern about the lack of accountability of previous year’s budgets.

Experts said the budget speech has moved away from the ‘midnight tonight’ policies where people were keen to hear on their radios what new taxes and policies would come into effect. Government has moved to create taxes and policies that are more predictable over a long term period.

Government is seeking to build a self- sustaining and export driven economy. Government’s specific macro-economic policies for 2012/13 will be to achieve high rates of economic growth, achieve low and stable rates of inflation and increase domestic revenue mobilization efforts.

The other policies are to maintain a minimum level of international reserves, promote a sustainable and competitive exchange rate. Gross domestic product growth rates are expected to recover to about 5.4% due to the expected strong investment in agriculture production and productivity, power and roads.

 Construction on the Kampala-Entebbe Express Highway and Karuma Hydropower Project are expected to commence in 2012/13 with their budget allocations.

The budget for 2012/13 comes at a time when the economy is facing challenges some local and others global especially with the Eurozone financial crisis. The Eurozone crisis will reduce donor funds to Uganda. External grants are expected to decline from 2.7% of GDP in 2011/12 to 1.8% of GDP in 2012/13.

The priority interventions of the budget strategy for 2012/13 will be in the following areas; maintaining macroeconomic stability, increasing agriculture productivity, encouraging agro-processing and market diversification, appropriate skills development.

The other areas are facilitating the private sectors as the engine of growth, removing infrastructure constraints in transport and energy and improving efficiency of public service delivery.

The national budget is the key instrument through which government implements its policies. The Civil Society Budget Advocacy Group demands that the government should put more money into agriculture, health, roads and education.

They accuse government of not walking the talk when it comes to putting money where its mouth is and even not implementing and accounting for where huge amounts of funds are allocated.

The 2012/13 national budget will focus on an output oriented budgeting as a mechanism to transform the budget process from a ‘spending orientation’ to a ‘result focus’.

“Emphasis is now placed on what Government is going to achieve by spending money, rather than solely on what money is spent on,” Patrick Ocailap, director budget, minister of finance, planning and economic development said.

Ocailap said result oriented budgeting was one of the key reforms in the country’s planning and budgeting processes. “These reforms have not only targeted to improve resource allocation for effective service delivery but also to promote accountability and transparency in the utilisation of public resources,” he said.