Govt asked to re-channel sh200b for entertainment to COVID-19 

COVID-19

KAMPALA - Members of civil society organisations have implored the Government to consider re-channelling sh206b meant for entertainment, welfare and donations by different government ministries, departments and agencies (MDAs) to help in the fight against the novel coronavirus (COVID-19).

Recently, finance minister Matia Kasaija told Parliament that the Government would borrow sh700b from the World Bank to deal with the possible negative impacts of the coronavirus on Uganda.

However, addressing journalists in Kampala Sunday on the impact of COVID-19 on Uganda's economy, civil society organisations (CSOs) under their body Civil society Budget Advocacy Group (CSBAG), said to avoid borrowing, the Government should find money from wasteful expenditure such as entertainment and foreign travel to finance the fight against COVID-19.

"For example, funds equivalent to sh206b expected to be disbursed for welfare, entertainment and donations in the fourth quarter of the current financial year can be reallocated to meet the pressing health needs," Julius Mukunda, the executive director of CSBAG, said.

The CSOs further advised the Government to make use of savings on suspended travel abroad by government officials and workshops to help raise the money needed to facilitate the fight against COVID-19.

CSBAG also urged President Yoweri Museveni to fast-track the rationalisation of MDAs, saying such measures can allow the Government to prioritise allocations to the health sector to combat COVID-19.

"We do not want a situation where health facilities fail to attend to what may be classified as non-urgent healthcare issues such as women's reproductive health and other issues affecting children, persons with disabilities and the elderly," Mukunda said. 

Capital incentives

The CSOs also want the Government to recapitalise Uganda Development Bank with sh300b to help jumpstart small-medium enterprises (SMEs).

They argue that this will safeguard against job losses or collapse of businesses for over 2.5 million people who are employed in this sector. SMEs makeup 70% of Uganda's economy and contribute above 20% of the country's GDP.

In his statement to Parliament recently, Kasaija said COVID-19 would greatly impact on Uganda's economic growth.

The projection for economic growth in the 2019/20 financial year has been revised downwards from 6.0% to between 5.2% and 5.7%, depending on the severity of the COVID-19 impact on Uganda.

The CSOs also want the Government to consider recapitalising the central bank with sh1 trillion to enable it to deal with unscrupulous speculators, provide liquidity to financial institutions, control inflation and exchange rates.

Relatedly, the Centre for Budget and Tax Policy has advised the Government to consider establishing a sh800b income stimulus for informal sector workers, which can be accessed through bodaboda market vendors and traders associations.

Patrick Kataabazi, the executive director of Centre for Budget and Tax Policy, said the Government should set up an economic recovery task force to guide the rolling out of economic recovery programmes.

The task force should have representation from MDAs, private sector and civil society.

The organisation also proposed that the Government reinforce the existing social protection interventions to target all older persons aged 60 and above with direct cash support. They want the grant to older persons to be increased from sh25,000 to sh50,000