Why we must pay attention to budget reading

By Patrick Kiconco Katabaazi 

The period between 1987 and 1990, the President used to read the budget speech by himself.

The budget speech day was memorable because both regular and enlightened people (public servants including teachers and business personalities) would gather around radios to listen earnestly to all budget proposal.

Those days, people would anxiously listen to every word and record firsthand information about proposed taxes and commodity prices for essential items such as sugar, paraffin, and soap among others.

Civil servants would listen in anxious anticipation of salary increment and generally payment plan of arrears that had accumulated arising out of political turbulences preceding 1990s.

There was a turn of events with the drafting of the Constitution of Republic of Uganda, 1995. Under this constitution, planning was fortified in Article 155 (1-6) in which The President is compelled cause to be prepared and laid before Parliament in each financial year, but in any case not later than the 15th day before the commencement of the financial year, the estimates of revenues and expenditure of Government for the next financial year. 

Estimates would have earlier been submitted by the respective heads of any self-accounting department, commission or organization set up under the Constitution.

These must be submitted to the President at least two months before the end of each financial. These processes were also enhanced by the Budget Act, 2001.

With these constitutional reforms, the budget speech would be read by the President (who may delegate that function to the Minister responsible for Finance) on or around 15th of June every year.

On the day of the budget speech that's when the nation would know the kind of tax measures being proposed by government for the subsequent Financial Year commencing every 1st of July.

The difficulty in that process was that Parliament would embark on the process of scrutinizing budget estimates, tax bills, and appropriation bill and ministerial policy statements after the budget speech.

More often than not the final national budget would then be approved by around September or early October of new Financial to be and operationalised retrospectively to cover activities and policies that started July 1.

While the budget speech under that arrangement was still capable of stocking anxiety among the population because of less predictability the general public finance management practices were not streamlined.

The  Uganda Public Finance Management Reform Strategy (2011/12 - 2016/17 and other studies such as  Public Expenditure and Financial Accountability (PEFA) report 2008, and Financial Accountability and Management Programme (FINMAP) Mid-term Review (2010) necessitated  comprehensive Public Finance Management reforms to streamline  planning and utilization of public resources with the aim of improving service delivery.

This resulted into the current  law -'The Public finance management Act 2015 which came into effect on 6th of March,2015.

This has had implications on the budget speech because it is read when the budget estimates and the accompanying   have been passed already by Parliament.

The budget cycle has been shortened from eleven months to nine months in contrast with the Budget Act.

The new law provides that the budget must be approved before the start of the Fiscal Year contrary to what has been the case where the budget was approved by Parliament several months into the Fiscal Year.

This can also help enhance the absorption capacity of accounting entities. The cycle starts with the budget consultations at local government level between October and November ending with the reading of the budget speech in June and commencing of budget implementation by 1st July of a given financial year.

The dilemma brought by these reforms raises fundamental questions? Do we need a budget speech when parliament has already passed the budget? Isn't this a waste of time and resources since it is more of ritual?

Can't we have a budget speech earlier in March-April at the presentation of budget estimates to Parliament as per the requirements of the public finance management Act, 2015?

My personal opinion is that is that budget speech is important because it helps tease out critical information that is often buried in voluminous Budget Frame worker papers and Ministerial policy statements for public consumption.

It would seem to me that the necessity for a budget speech can only be questioned by highly technically competent people who have ability to comprehend budget information. Ordinary citizens find a lot of useful information that they would have otherwise missed.

The events of the budget speech also help to amplify the importance of the day and a lot of information about development strategies besides that which is contained in speech is churned out by both mainstream media and social media.

Therefore the budget speech day is one of the most effective ways through which government shares information on how it intends to deliver on proposed development outcomes.

This is critical because once citizens become aware of plans of government and funds allocated to them, and then can easily hold duty bearers to account which enhances accountability of public funds.

I would encourage citizens to listen in to the budget speech on Wednesday, June 8, 2016 and also look out for information on district budget speech days so that we call all are abreast with what governments intends to do, taxes levied and funds allocated to different public programs.

The writer is an advocate/budget and tax policy adviser