Minister Bahati makes U-turn on Petroleum Fund

Kampala, Uganda | THE INDEPENDENT | The Minister of State for Planning David Bahati says the Petroleum Fund has shillings 70 billion.

This is contrary to what he told the parliamentary finance committee last week that the fund had been depleted.

Appearing before the budget committee on Tuesday, Bahati backtracked, saying that the fund has a balance of 70 billion shillings.

The Petroleum Fund is overseen by Bank of Uganda.

However, the utilization of the Petroleum Fund has been a point of contention from the time it was created.

The Public Finance Management Act 2015 provides that the petroleum revenue shall be used for the financing of infrastructure and development projects of government and not the recurrent expenditure of the government.

However, the Auditor General’s Report for the 2018/2019 financial year notes that there was no explicit mention of the Fund as the source of funds but was rather disguised as medium-term expenditure framework for the financial years 2015/2016 to 2021/2022 and submitted to Parliament.

The Budget committee chairperson, Amos Lugoloobi says that the committee will discuss the issue of the Petroleum Fund after the ministry of finance tables the third National Development Plan in Parliament.

He says that whatever Bahati has presented or is contained in the 2020/2021 National Budget Framework Paper violates the Public Finance Management Act, 2015.

The Act provides that the framework paper must align with the approved National Development Plan III which has not yet been presented and approved by Parliament.

Lugoloobi, however, emphasizes previous recommendations of the Budget Committee regarding the Petroleum Fund.

The Budget Committee recommended among others that the government should put in place a petroleum investment framework as envisaged in the law.

It made the recommendation following reports that government was planning to raid the fund and pick Shs 445.8 billion to finance the 2019/2020 budget shortfall.  The committee report noted that as of end of December 2018, the Fund had Shs 288.7 billion because Shs 200 billion was withdrawn in June 2018 to finance the 2018/2019 budget.

*****

URN