Rédaction Africa Links 24 with Elizabeth Kamurungi
Published on 2024-01-30 23:00:00
The Parliament decided to approve the Shs52.7 trillion budget for Financial Year 2024/2025, as indicated in the Budget Framework Paper. However, there are concerns about the impact of this budget on service delivery, with warnings that statutory expenditure, such as debt repayments, could eat into funds available for development.
Compared to the current budget, the projected budget for the upcoming year is Shs14 billion lower. The government has set the goal of accelerating economic growth to at least 7 percent, but legislators have raised concerns about a potential mismatch between government pledges and the allocation of resources.
According to the Budget Committee of Parliament report, the total government resources for development projects and service delivery have decreased by Shs3.4 trillion from Shs25.2 trillion in the current financial year to Shs21.7 trillion. The non-discretionary expenditure, which includes salaries and debt repayment, accounts for 59 percent of the budget, amounting to Shs30.9 trillion.
Debt repayment is a significant part of the budget, with Shs17 trillion allocated for this purpose. Additionally, there are allocations for various sectors such as human capital development, governance and security, integrated transport infrastructure and services, among others.
The government is projecting a decrease in support from external partners due to the passing of the anti-homosexuality law, leading to an increase in domestic borrowing by 21 percent. Some sectors, like health, are adversely affected by the decrease in external funding.
To raise money, the Uganda Revenue Authority is expected to collect Shs29.9 trillion in tax and non-tax revenue. The government also plans to obtain funds through domestic borrowing, project support, and local revenue for local governments.
Despite concerns over the accuracy of public debt figures, it is clear that borrowing has become a significant issue for the country, with potential long-term implications. There are also concerns about the government’s failure to address corruption and fiscal indiscipline, leading to unnecessary budgetary shortfalls and increased borrowing.
Overall, the new budget reflects the government’s focus on driving development through various programs and sectors. However, the potential impact of debt and the need to address issues of corruption and fiscal indiscipline remain prominent concerns for the country’s financial health.
