Parliament’s Budget Committee has recommended that the government reviews and revises the National Budget for the coming financial year 2020/2021 in the wake of COVID-19.
This is one of the committee’s recommendations in its report to Parliament in which it approved the appropriation of Shs 45.493 trillion for the National Budget in the coming financial year 2020/2021.
Out of this, Shs 11.922 trillion is for recurrent expenditure, Shs 18.07 trillion for development expenditure and Shs 15.49 trillion for statutory expenditure. The budget is an increase of 12.36 percent compared to the approved resource envelope for the current budget of Shillings 39.64 trillion budget for the financial year 2019/2020.
According to the sector allocations, the Works and Transport docket takes the lion’s share with an allocation of Shs 5.84 trillion, followed by Security with Shs 4.504 trillion while Shs 4 trillion is budgeted for payment of interest, the Education sector has a budget of Shs 3.624 trillion, while the Health sector budget stands at Shs 2.772 trillion while the agriculture sector budget stands at Shs 1.324 trillion.
The budget is expected to be funded by resources from domestic revenue amounting to Shs 21.7 trillion, domestic borrowing Shs 3.55 trillion and others.
While presenting the report to parliament on Wednesday, the Budget committee Chairperson Amos Lugoloobi noted that during their interaction with officials from the Ministry of Finance, they were informed that various sectors will be affected by the COVID-19 pandemic especially Tourism and Industry which are the major sources of foreign exchange earnings.
Lugoloobi, however, said that his committee observed that some of the budget priorities need more emphasis others may require some readjustment in resources to mitigate the negative effects of the COVID-19 pandemic.
He recommended that the government comes up with an integrated multi-sectoral and multi-stakeholder economic response plan to support businesses, groups of vulnerable people and the overall economy.
“The strategic budget priorities for next year should address the short-term, medium-term and long-term stimulus packages to key priority sectors that are critical for ensuring that the well-being of all Ugandans is at the forefront in resource allocations. Some of the budget interventions earlier planned can be postponed as the economy stabilizes,” said Lugoloobi.
He added that there is a need for more investment in Agriculture and Agro-processing to produce enough food for the population and surplus for sale to earn foreign exchange.
The budget committee also wants the government to establish Silos at the county level for food storage and minimize post-harvest losses as well as address food security.
According to Lugoloobi, manufacturers need affirmative action to maintain production and also maintain the employees. The committee cites the need to avail cheap credit through the Uganda Development Bank (UDB) to help manufacturers in production.
He also recommended that government prioritizes health spending by establishing a hospital in every district with operational ICU units, provide resources for ambulances across the country, recruit, facilitate and maintain qualified medical staff.
However in his minority report on Budget Butambala County MP Muhammad Muwanga Kivumbi noted that with cuts from wasteful expenditure such as travel abroad, workshops, public relations and advertisement, Uganda can save a lot to allow reallocations to key sectors to deal with the effects of the COVID-19 Pandemic.
Kivumbi says that the committee’s selected budget adjustments are inadequate while reallocations are a sign of poor prioritization of scarce resources during and after the fight of COVID.
Kivumbi suggested the suppression of funding towards travels abroad, special meals, classified expenditure, workshops and others to fund critical items in the sectors of health and education.
He, however, recommended that a 20 percent cut is made on the selected items in the financial year 2020/2021 to enable the country raise Shs 376.1 billion to finance critical interventions like the construction of hospitals, development of Intensive Care Units in all districts of Uganda and purchase of ambulances in every district and others.
Kivumbi’s views were supported by various MPs who called for reallocation to cover key sectors that have been underfunded amid the coronavirus pandemic.
Masaka Municipality MP Mathias Mpuuga said there was no doubt that many Ugandans are going to lose jobs as a result of COVID-19 and that there is need to invest in the agriculture sector to ensure that these people are absorbed.
“We want to see more money that is going to keep the economy robust after the Pandemic,” said Mpuuga.
Angelina Osegge, the Soroti Woman MP also suggested the upgrade of all health centres across the country to be able to deal with cases of Coronavirus.