Parliament on Thursday approved the national budget for the financial year 2023/24 totaling to Shs52.7 trillion paving way for the Minister of Finance Matia Kasaija to prepare the budget speech slated for June 14, 2023.
The new budget has posted a Shs4.6 trillion increase from the budget of the current financial year which is Shs48.1 trillion. However, by the close of the financial year on June 30, the current budget may have also hit upwards of Shs50 trillion considering the supplementary expenditures requests before Parliament.
Parliament arrived to the Shs52.7 trillion figure after a number of addendums and corrigenda were tabled by the Finance Ministry following the approval of Shs49.9 trillion Budget Framework Paper early February. Such additional information laid before Parliament by the finance ministry is the reason the budget was not passed on Wednesday because Budget Committee Chairperson Patrick Isiagi Opolot said they could not reconcile the figures with information received at short notice.
While moving a motion for the House to consider the estimates of revenue and expenditure for the next financial year, State Minister for Finance (General Duties) said that the budget was prepared in a highly “constrained environment” before revealing that resources were allocated to priorities depending on what is available to government.
Musasizi told Parliament presided over by Speaker Anita Among that the economy is projected to have grown by 5.5 percent by the end of this financial year and the projected economic growth for next financial year is 6 percent.
“I wish to reassure this august House that the economy is on progressive trajectory to achieve at least 6 percent in the period 2023/24 to 2024/25. Therefore, by end of financial 2023/24 Uganda’s GDP is projected to grow to Shs206.4 trillion ($54.99b)” said Musasizi.
Resource envelope
According to the report of the Budget Committee, the resource envelope for the next fiscal year includes; Shs29.6 trillion that is expected to be collected by the Uganda Revenue Authority as domestic revenue; Shs2.7 trillion from external budget support; Shs3.3 trillion from domestic borrowing; Shs8.2 trillion from external support to projects; Shs8.3 trillion in domestic borrowing roll over; 287.1b from local government revenue.
In the expenditures government will spend Shs2.6 trillion on repayment of external debt; Shs6.1 trillion will go to the interest payment on the loans; Shs1.5 trillion for reimbursement of Bank of Uganda; Shs217.5 for recapitalization of the central bank and Shs205.8b to go on payment of domestic arrears.
Where money is going
Much as the Minister of Finance is expected to deliver the national budget figures depending on the appropriations on a programme-based approach, the figures supplied by Parliament were based on the allocations to the different Ministries, Departments and Agencies (MDAs). Such was done with reference to supply for recurrent expenditure which caters for wage and administration, development expenditure, and statutory expenditure.
The central government votes will take Shs12.2 trillion of the recurrent budget and Shs13.2 trillion of the development budget. Local governments that include cities, districts and municipalities will take Shs4.1 trillion in recurrent expenditure and Shs1.1 trillion in development budget. Other areas where the budget will be spent are; referral hospitals with Shs282.2b in recurrent expenditure and Shs24b in development expenditure; and, Missions abroad which will receive recurrent budget of Shs189.6b and development resources of Shs58.3b.
In recurrent budget, as in the case of previous financial years, the Ministry of Defense is taking the lion’s share of the budget with Shs2 trillion; followed by the Ministry of Finance with Shs1.9 trillion; Ministry of Education and Sports, Shs286.2b; Ministry of Gender, Labour and Social Development, Shs202.2b; Ministry of Works and Transport, Shs192.5b; and Ministry of Health, Shs113b among others.
The Ministry of Defense still tops the allocations for development expenditure with a whooping Shs1.8 trillion. Other top recipients of development budget are; Ministry of Health, Shs1.5 trillion; Ministry of Energy, Shs1.3 trillion, Ministry of Water, Shs1.1 trillion, Ministry of Works and Transport, Shs1 trillion; and Ministry of Agriculture, Shs988.1b.
The minority report presented by Butambala County MP Muwanga Kivumbi questioned the reallocation of funds to MDAs that are not involved in service delivery at the expense of other critical priorities like the pay for medical interns and rural electrification.
Kivumbi said that Parliament needed to appropriate Shs80b for the payment of the 1091 medical interns that have not yet been deployed and also Shs100b to finance the rural electrification programme, adding that poles were erected in most parts of the country but have not been connected to the electricity.
“The country is tired of strikes by the medical interns and yet these are people who really serve the commonest people. We must provide money for the interns. The Budget committee has shifted 100b from Rural Electrification. In my humble view, this kind of reallocation should be rejected. I come from a constituency where poles have been erected for many years. We are tired of explaining. And this is going to cost the President in the next election or whoever” Said Kivumbi.
Parliament agreed that the Ministry of Finance should find money to provide to the Ministry of Health for the deployment of the medical interns some of whom have been redundant for over a year. This was after Budget Committee Chairperson, Opolot revealed that only Shs10.8b has been allocated for the medical interns out of the Shs80b needed.
State Minister for Health (General Duties), Anifa Kawooya informed Parliament that her ministry has only been assured by Finance Minister Matia Kasaija that the Shs22b for arrears for medical interns will be release within this month.
“The issue of the interns is very vital. Now as a Ministry we have already prepared and we are ready to deploy 1091 to our 51 sites. The Minister of finance Kasaija committed himself that by the end of this week, he is going to give us this money. As a Ministry we are waiting for this money (Shs80b) and we deploy the interns.” Said Kawooya.
Speaker Among, welcomed the Shs22b that the Ministry of Finance promised to release but insisted that the Shs80b must be found within the budget to ensure that the issue of the medical interns is sorted.
“As we get the arrears, we need what is sufficient for the deployment of the interns for the whole period. Let us get the 22b which is coming this week and we have to budget for what will take the interns for the whole period.” The Speaker guided.
Meanwhile, State Minister for Energy, Okaasai Opolot was not allowed to make a case in support of the minority report on the need to reallocate Shs100b from other MDAs to his ministry to fund the rural electrification programme.
The Speaker insisted that there is Shs500m that was already released to Rural Electrification Agency (REA) before it was disbanded that has not been accounted for and also the low absorption of loans that the House has been approving for the sector.
“Part of the money that you want us to provide to energy is what we have supplied in recurrent expenditure. First clean your house as REA. When REA was removed, it went with Shs500m. I want to ask Ministry of Energy to first bring accountability of the Shs500m that moved REA with. We also need a report on exemptions (of taxes on minerals) before giving you more money” Among insisted.
Meanwhile, at the Committee of Supply, none of the proposals carried in the minority report was considered and the House approved figures provided by the Majority report. The Speaker informed the Ministry of Finance to consider the information in the minority report in the next budget cycle to avoid making more mistakes.
With the House now strict on the issues of quorum while passing Bills, the Speaker announced that there were 188 legislators physically present while nine others participated virtually at the time of passing the Appropriation Bill, 2023 which when assented to by the President will allow expenditure on the Consolidated Fund in the next financial year.
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