Parliament is expected to resume on Tuesday to reconsider the Sh72 trillion budget for the 2024/25 financial year.
This is the first time since the passage of the Budget Act and the Public Finance Act of 2015 that Uganda’s parliament has reconvened to consider a budget already approved by the legislatures. MPs have been recalled from recess to re-examine the budget after President Museveni refused to sign the appropriation bill. Museveni reportedly asked the speaker of parliament, Anita Among, to reset the government’s priorities.
The President’s action came as a surprise to lawmakers and the general public. It has also raised some questions because the speaker had earlier indicated, on the day of the budget reading, that the budget consideration process was highly consultative. Sections 5 and 8 of the Public Finance Management Act (PFMA) 2015 and Rule 145 of the Rules of Parliament approved the Budget Framework Document for the financial years 2024/25 and 2028/29 at the end of January 2023.
The House approved the ministerial policy statement for various ministries in mid-April 2024. By mid-May, parliament had also approved the tax and revenue bills needed to operationalize the 2024/25 financial year budget. Among other things, he thanked the Minister of State for Finance, Henry Musasizi, for devoting time and commitment to various committees of parliament.
He also thanked the Permanent Secretary/Treasury Secretary and the Attorney General for their input. He reported that some of the salient issues that emerged from the budget process included the need for continued resource allocation to farm mechanization, agro-industrialization and value addition. Among these, he highlighted the need to align resource allocation with the prevailing government policy of rationalization.
“This should lead to increased efficiency and the elimination of duplication and waste in expenditure. The need for resource efficiency measures to avoid the risk of debt burden,” he said.
But now, the development of events has given rise to lingering questions between the executive and the legislature. As MPs, the government technocrats received the budget presented by Matia Kasaija as approved by the House on May 16. The MPs authorised the executive to spend Sh72.1 trillion for the 2024/25 fiscal year.
The budget would have come into effect from yesterday, July 1, if not for the president’s insistence that parliament reconsider the allocations. On June 7, Museveni, while delivering the state of the nation address, said he had evidence that MPs were manipulating the budget by allocating more money to some ministries and departments so that they could receive a percentage of the money in the form of bribes.
Museveni made good on his threats to “crush the corrupt” when MPs accused of seeking bribes from Human Rights Commission Chairperson Mariam Wangadya were arrested. Some reports indicate that the President was not happy with the MPs for slashing the budget of some of the key government institutions to the tune of Sh75 billion.
Last week, Dr Fred Muhumuza told reporters in Kampala that while parliament has the power to allocate funds to the budget, MPs have sometimes exceeded their mandate.
“We have had the experience very often that parliament has overstepped its powers by starting to cut resources and allocate them. That is not the power of parliament. Parliament is about guidance and allocation of resources,” Muhumuza said.
He said that the power of allocation is in the hands of the executive according to the principle of separation of powers and budgeting.
“The allocation of funds is the responsibility of the executive. So, if Parliament feels that there is too much money, we believe that it should be there and they should send that signal to the executive,” Muhumuza advised.
The Civil Society Budget Advocacy Group (CSBAG) agrees that when considering the budget, parliamentarians should not put their individual or selfish considerations first, but rather the national interest based on available resources. CSBAG Executive Director Julius Mukunda said the decision by parliament to selfishly reallocate budget priorities demonstrates a lack of consideration for the broader needs of society.
“These actions prioritise individual interests over the welfare of the entire population, which is fundamentally wrong. We consider these corrupt practices of reallocating funds to benefit their interests for personal or political purposes to be corrupt budget allocation and budgeting for self-preservation,” Mukunda said.
“National interests must come first when parliament proposes the budget to avoid unnecessary and excessive allocation of resources. On the positive side, we believe that the return of the budget by the president is an opportunity to eliminate unnecessary expenditure from the budget.”
He said the government must improve budget accountability and transparency, and that parliament must prioritise accountability in all budgetary matters. While debating the budget, sections of the public who had been following the budget process expressed fear that an estimated Sh72 trillion budget was unlikely to be implemented as written. They accused both the legislature and the executive of unnecessarily inflating the budget.
Experts like Muhumuza have pointed out that for a budget to be effective, it must be aligned with government priorities and be based on values. Some of the concerns arose at the last minute of the passage of the appropriation bill.
Ambush Budget
Lwemiyaga MP Theodore Sekikuubo, who has been outspoken during the previous debate, attempted to block the Government’s correction to the budget presented by Minister Henry Musasizi. Sekikuubo called it an ambush.
“We are passing a budget in the name of the people of Uganda and a 14 trillion shilling increase by surprise. We are passing this budget by surprise. We have not looked into it,” Sekikuubo said.
Kiira MP Semujju Ibrahim Nganda agreed with Sekikuubo that the government had developed a habit of submitting corrections to the budget at the last minute when the House is convened as a committee of supply. He said that this tendency limits the thorough scrutiny of the proposal by the parliamentary budget committee.
In this regard, Budadiri East MP Nathan Nandala Mafabi wrote a minority report in which he protested, stating that the budget figures were inconsistent.
“The 2024 Appropriation Bill which accompanied the budget (estimates) under Section 13 of the Public Finance Management Act, has different figures. Honourable Musasizi told the budget committee when he appeared that in fact the total budget was now Sh58.3 trillion as contained in the Appropriation Bill,” said Mafabi, who was once acknowledged by the Speaker of Parliament among others as an authority on finance and budget issues.
Mafabi had warned that the executive was not complying with the law.
“The total budget of Sh52.7 trillion was presented to Parliament in the Budget Framework Document. It increased to Sh53.3 trillion in February after the issuance of the second budget call circular. On March 28, the minister tabled an appropriation bill with a total budget of Sh58.3 trillion. He also tabled draft estimates totalling Sh60 trillion. Today, May 16, a correction amounting to Sh13,789.20 trillion was tabled in the House of Parliament, revising the budget to Sh72.130 trillion,” reads part of the minority report.
Mafabi said these amendments prevented ministries from submitting detailed work plans and procurement plans, which in turn obstructed the ability of budget committees to make well-informed financial decisions, contrary to Section 13 of the PFMA. His concerns appear to have been ignored when parliament went ahead and voted in favour of the new Sh72 trillion budget.
On the other hand, Butambala MP Muwanga Kivumbi, a seasoned lawmaker with a financial eye during the appropriations period, questioned the reduction in the budget transfer.
“Since I have been here, this is the first time I have come across a budget report that does not set out a discretionary budget,” said Kivumbi, who previously served as shadow finance minister in the opposition cabinet.
Kivumbi and the opposition have consistently pointed out that sometimes the voices of reason tend to be overshadowed by partisan considerations, even when crucial issues such as the national budget are being discussed. When MPs passed the appropriation bill, Kivumbi protested that it had not been thoroughly debated.
“What is wrong with this institution where I am is that we approved this budget without debate, without you knowing these issues, without some parliamentarians knowing all their implications,” Kivumbi said sadly.
Supplementary budgets
Requests for supplementary budgets were expected to reduce when the Public Finance Management Act was enacted in 2015. However, over the years, such requests have been increasing despite the distortion it has on budgetary discipline. Kivumbi and Ssemujju have been raising concerns about supplementary expenditure.
Last year, Kivumbi obtained permission from Parliament to request the amendment of Section 25 of the Public Finance Management Act 2015. He suggested that all additional expenditure must be approved by Parliament in advance.
Ssemujju presented a minority report and questioned the amount of money allocated in the budget for debt servicing. He also questioned discrepancies in the debt figures provided by the Ministry of Finance and the Auditor General’s Office. According to Ssemujju, the Ministry of Finance reported that public debt stood at Sh86 trillion, while the Auditor General’s figure indicated that the debt stood at Sh97 trillion, well above the acceptable sustainability threshold of 50 percent.
Ssemujju said the public debt stood at 52.7 percent of the country’s Gross Domestic Product (GDP) of Sh184 trillion.
“The biggest task for us as the 11th parliament is to significantly reduce the Sh97 trillion public debt. Parliament must reject any measure that seeks to increase public debt,” Ssemujju argued.
Opposition leader Joel Ssenyonyi and his cabinet rejected the budget day event, saying there was no point in attending and passing the budget when their opposing views had been rejected. The opposition considered the budget unrealistic.
