Following the presentation of the National Budget last week, the Certified Public Accountants of Uganda (ICPAU) has Monday held a National Budget Breakfast, analyzing the 2017/2018 GOU Budget, as well as discussing its implications.
One of the biggest observation was that the economy is in a ‘sick’ state “but not yet in intensive care unit (recession).”
According to CPA data presented today at Imperial Royale Hotel, the National Budget reduced by 2.8 per cent from the 2016/17. Of the Shs29tn, only Shs12.99tn (44.8 per cent) is money available for spending and this huge reduction has greatly worried accountants.
“GDP growth went down to 3.9 per cent from 4.8 per cent in 2015/16 that is a decrease of US US $1.8bn. Agriculture is in recession – negative growth both in 2015/16 financial year and again in 2016/17.
Industry and services also performed badly; Industry experienced 3 quarters of negative growth Services experienced one quarter of negative growth.”
Although domestic sources will finance 75.5 per cent of the Budget, the actual money to be raised from tax and non-tax revenue will finance only 51 per cent of the budget. The rest (24.5 per cent) is domestic debt.
“For a 3rd year in row, the budget includes provisions for refinancing maturing domestic debt, to a tune of UGX 5tn (22 per cent of the ‘true’ budget–3 per cent more than 2016/17 budget). With the estimated population of 38 million, each Ugandan shares Shs578,000 of the ‘true’ 2017/18 budget (or Shs763,000 of the 29tn).”
With a total debt of Shs31tn, each Ugandan (including 1 day old babies) is indebted at a tune of Shs815,789.
Reacting to the presentation by Ramathan Ggoobi, an Economist and Lecturer at MUBS, the minister of Finance Matiya Kasaija pleaded with the accountants to join in the in the struggle to achieve the theme for the 2017/18 financial year which is ‘Enhanced Productivity for Inclusive Growth and Job Creation’.
“The theme of this budget is; Enhanced Productivity for Inclusive Growth and Job Creation. So, please join me. We just can’t continue talking. A lot of youths are unemployed….Instead of being an asset, they will become a very big problem for us if we don’t deal with this problem,” said Kasaija.
“During my visit to Kiboga yesterday, I met very many mangoes. Sadly, many will rot due to lack of organization amongst famers. We need to organise farmers. If a tree produces 100 mangoes a year and you gave these farmers 100 seedlings to each, probably 50 seedlings survive to maturity. If a mango goes for Shs1,000 each farmer would be earning Shs5 million in every harvest. Assuming a farmer planted 150 mangoes on three acres, such a farmer would be earning Shs15 million from each harvest,” he added.
Commenting on the Minister’s remarks, Goobi advised Kasaija to pool all resources scattered under Youth Livelihood Fund (Shs67bn), women fund (Shs41bn) and Presidential donations (Shs70bn) into Uganda Development Bank capital.
“When will Uganda get a competition law? Economy without rules!! Can government discipline statutory agencies, authorities and commissions which are ‘semi-independent’ of their mother ministries? The top 4 sectors with the largest budget allocations are headed by women! (Gender emancipation or waning trust in men?)”