Road Fund starts July - Finance minister

By Vision Reporter

A ROAD fund will be established in July, the finance minister has announced. The road fund will cater for the insufficient funding of road maintenance in the country.

By Sylvia Juuko
and Alice Kiingi

A ROAD fund will be established in July, the finance minister has announced.
“People who use roads should pay for them. The current funding for road maintenance has been insufficient, so a road fund will cater for this. It will be financed through road user charges, fuel levy, annual licence fees and international transit fees,” Dr. Ezra Suruma said.

He was unveiling the budget strategy for the next financial year during a public expenditure review workshop at Hotel Africana in Kampala yesterday.

William Okecho, the chairperson of the parliamentary budget committee, expressed concern that charging a fuel levy and road licence fees would amount to double taxation.

“The Government should explore the possibility of scrapping road licence fees in favour of the fuel levy, since the latter will favour an increase in the tax base compared to road license, which is regressive,” he argued.

Suruma stated that the economy was expected to accelerate to 6.3% this financial year, despite the high energy costs, drought and volatile international oil prices.

He said the over-all budget spending for the first three quarters of this financial year (July to March) was in line with expectations, with the budget releases amounting to sh2,306.9b. This represents 100.3% performance.

The minister explained that in the next budget, the Government’s priority areas included investments in energy, information and communication technology, development and maintenance of transport infrastructure.
He added that rural development in northern Uganda, focus on science, technology and industrial development, as well as universal secondary education were also priority areas.

In addition to constructing Bujagali Dam, he said the Karuma hydro-power project should commence as soon as studies were complete.

“The Government cannot afford to return to crises of early 2005 when the economy faced the possibility of a shut-down. The Energy Investment Fund will therefore be supplemented annually to provide enough resources to fund the construction of these dams and also provide the necessary transmissions and distribution systems if the private sector is not able to do so.”

Regarding the Northern Uganda Reconstruction Programme, Suruma said the Government had earmarked sh623b, which will be disbursed over a three-year period.

Donors commended the government’s growth efforts but expressed concern over the limited progress in addressing corruption.

“We are concerned that little progress has been made in addressing corruption. Our perception is that the government’s commitment to zero corruption is yet to be demonstrated. The lack of urgency and funding to take on investigations reinforces our concerns that the corrupt are doing so with impunity,” said Fintan Farrelly, the head of development at the Irish embassy.

Road Fund starts July - Finance minister