Can the little available money work for farmers?

Roman author, lawyer, orator and politician, Marcus Tullius Cicero 106 BC - 43 BC, argued that “...the budget must be balanced. The public debt must be reduced; payments to foreign governments must be reduced, if the nation does not want to go bankrupt. People must again learn to work, instead of living on public assistance.”

The quote brings out two important lessons; that a national budget should focus on growing internal capacity to generate local revenues to finance its own budget and thus reduce dependence on aid. Indeed, that we spent $5.3b (sh13 trillion) on importing goods and earned only $4.1b (sh10.04 trillion) from export of goods and services in the last financial year is a trend that we have to reverse as a country.

Secondly, that citizens should not expect government to provide everything, but rather people should work to develop themselves and their country – a budget should not make people dependant on the state. A state is only a regulator and
enabler. Will the 2012/2013 agriculture budget enable the sector to grow and gain competitiveness in the region? Maybe, and this is why and how.

Allocation to the agriculture sector:
A sh150b increment to sector allocation, that is, from sh434.1b last financial year to sh585.3b this financial year is a move in a right direction. Considering the importance of the sector to food and nutrition security, creation of jobs and raw materials, agriculture should even get a bigger share of the pie.

But what should concern farmers and those that are concerned about them is the efficient utilisation of the allocated resources to transform lives of farmers and the country. Therefore, farmer groups and community leaders should develop mechanisms to follow this money.

At the National level, Uganda National Farmers
Federation should coordinate budget implementation monitoring efforts. Farmers must organise to engage and turn the budget in their favour.

Clear targets and outcome indicators should be contained in the budget. For example, the National Agriculture Advisory Services got sh52.9b; will this increase the percentage of farmer households that are visited by an extension worker from the current 14% to at least 30% next financial year? And what will be the percentage of this on real agriculture productivity?

How about the allocation of sh48.9b to the National Agricultural Research Organisation? Will this allocation lead to development of, for example, coffee and banana wilt resistant varieties by next financial year or a report on progress? Or what is the projected figure of farmers that will receive wilt-free planting materials?

The selection of flagship commodities like coffee, tea, maize, beans, fruits, vegetables and fish is good for both export earnings and food and nutrition security – remember beans and maize flour have guaranteed food and nutrition security in most schools for many years. But what is our target tonnage for beans, maize and fish this financial year? Targets will be the only way we can follow and  determine our performance come the reading of our next budget.

The power of leverage and smart budget applications. The budget can also be a powerful stimulator of innovations and investment from the private sector. For example, unlike the last financial year where hoes were prominent – this financial
year, sh500m has been provided for tractors.

Indeed, with increasing scarcity of labour, the cost of opening up arable land for production are increasing at a rate of sh3,500 per piece rate on average – this is a good move. These tractors once used collectively will provide a great relief.

But some interesting options to consider; if we offered a tax holiday incentive to a tractor assembling company and removed all taxes and duties on tractor spare parts, we could have a cartel of interested companies that will provide tractors to farmers and farmer groups across the country at affordable prices. The same would also work for irrigation.

There are companies like Davis and Shirtliff that produce handy and intermediate irrigation equipment; can a tax incentive make their equipment affordable to many farmers? It is indeed viable. How about such companies working with Uganda Industrial Research Institute to spur innovations in intermediate and high end irrigation technologies?

Allocation to Uganda Coffee Development Authority (UCDA ). UCDA has been doing a good job. They scientifically realised that the reason for slumping coffee productivity and plummeting exports was due to coffee wilt, old coffee trees (above 30 years), harvesting of unripe berries and poor post-harvest handling.

UCDA has been on a strong campaign – distributing clean planting materials and doing progressive work on the other challenges. UCDA should have been rewarded with a bigger piece within the agriculture sector budget. I hope they
can mobilise money from other sources to keep the momentum going.

Conclusion
We are reaching a time when the agriculture sector cannot be ignored. Budget numbers alone will not wholly eliminate supply and demand constraints facing the agriculture sector. But rather, integrity in delivery of agriculture services will be the anchor to unlock the sector code.

This is a role we can all undertake in our communities, churches and other spaces. I agree with the point of view that community leaders at the grassroots should get back to work and re-engage the work of monitoring service delivery and mobilizing people to work. By-laws that stop people from consuming alcohol before 11:00am at village trading centres should be enforced.

A mix of enforcement and the market should work as pull factors to transform the rural society. Lipton (2005), argues that there are virtually no examples of mass poverty reduction since the 1700s that did not start with sharp rises in employment and self-employment income due to higher productivity in small scale family farms.

This remains true for Uganda. The writer is a policy analyst and an independent researcher on agriculture