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Divisions in Finance over URA money

Museveni to blame

A ministry official also said the entities in question are not divided because they are ideally saying the same thing.  

Muhakanizi and Akol are powerful individuals and one would expect them to speak the same language given their critical role in driving the economy.

Muhakanizi was appointed permanent secretary in May 2013. He has over the years been involved in designing policies that are critical in driving economic growth and social economic transformation.

Akol on the other hand has been CG since 2014. She has recorded mixed performance since her appointment. In 2014/15, she recorded a surplus of Shs139 billion but has since been reporting shortfalls.

In FY2015/16 she reported Shs404bn as shortfall, in FY2016/17, she reported Shs500bn as deficit and in FY2017/18, and the revenue body recorded Shs606bn as deficit.

Akol only reported improved performance after many bad years with Shs300bn as surplus. She might be anxious to maintain a positive run and is frustrated by politically driven targets that undermine her goal.

A significant amount of money that Akol collects goes into paying salaries and allowances for political representatives and meeting costs for politically created administrative units which Muhakanizi is opposed to.

According to the Ministry of Local Government Statistical Abstract of 2018, Uganda has 127 districts, 250 constituencies and 1, 293 Sub-counties/town councils.

Other independent researchers have also expressed dissatisfaction on creation of new administration units because they cannot be funded by the budget.

“Government should uphold the moratorium on creation of new districts,” reads part of a 2019 report compiled by Advocates Coalition for Development and Environment (ACODE) titled: Decentralization in Uganda – Trends, achievements, challenges and proposals for consolidation. The report says that there have been challenges related to inadequate financing and investment in human resources and facilities, weak systems and coordination, conflicting legislations and local leadership incompetence.

Muhumuza faults Muhakanizi for issuing Certificates of Financial Implication to pave way for the creation of new administrative units yet the latter argues there is no money to fund their operations.

“Most of these (administrative units) cannot be financed by the economy anymore,” Muhumuza said.

He said the buck stops with President Yoweri Museveni because he is at the helm of all these things.

Muhumuza said Museveni is in charge of creating the new entities for political reasons but he (Museveni) now needs to tone down his political pursuit to reflect the realities that are binding on government.

He added that pressure is catching up with Museveni and he is starting to realise the restrictions on the budget which has already seen government going for non-concessional debt from banks leaving the real lenders who give cheap money like China.

He says concessional lenders are beginning to rethink about Uganda’s ability to manage the debt.

Going into the 2021 elections, Muhumuza said that the new administration units that were already created gives Museveni political capital even when they have funding challenges.

“We are going to see him (Museveni) slowing down his leg on pushing for their actual implementation after all he has already picked political capital through their creation,” Muhumuza said.

But he has to put MPs and other Councilors in some of those districts which will cost the budget and keep pushing the deficit out, he added.

Finance Committee Chairperson Musaazi attempted to justify the political strategy on creation of new administration units. Speaking about the executive (Museveni) which creates them, Parliament which passes them, and the Ministry of Finance that endorses them using the certificate of financial implication, Musaazi appeared helpless.

“There are things which come to Parliament and you do not reject them because of the political implications,” he said.

He said: “If one comes from a county and it is being made a district, even when you don’t believe in the creation of the district, can you go against the wishes of the people you represent?”

But he added: “some of these administrative structures are a stress to the budget and many are not functioning because of budget constraints.”

He said parliament will now identify budgeting, taxing risks and gaps and recommend what should be done.

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One comment

  1. ejakait engoraton

    Most of the targets that are set for AKOL are over what is realistic and this is deliberate to make her look a failure and therefore make KAGINA’s tenure a phenomenal success.

    She just happens to come from the wrong post code

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