As government accounting officers prepare to discuss the austerity measures proposed by the Covid-19 Task force on Food Security under the coordination of Operation wealth Creation (OWC) housed under the President’s office, economic experts have questioned the methodology that was used to arrive at the budgetary cuts and the proposed suspension of some of the critical-ongoing government development projects.
Economic experts pointed to the fact that some of the Programs which the OWC officials want to suspend like the Uganda Support Uganda Support to Municipal Infrastructure Development (USMID II)are largely donor funded with stringent performance conditions while others have running contracts that could attract penalties in damages worth millions of US dollars if they are terminated mid-term. Some of the Key Ministries’ budgets like ICT and NG which is supposed to coordinate government communication in the fight against Covid -19 and also implement the E-governance programs tailored for E-communication between government ministries , departments and agencies- to ensure good public service and also help in revenue collection (taxes and fees) ,it is proposed that their budgets be cut by well over 70%.
Experts who have studied the OWC document also argue that OW C officials have been selective in their proposals while targeting specific projects and leaving out many others some of which are not even as critical as those which are being proposed for suspension . Some of the indicative figures for cuts and savings do not tally with those indicated in the budget that was passed by parliament before it was read by the Minister of finance , Mr. Matia Kasaija last week.
The controversial proposals which must be approved by parliament according to OWC are meant to save government some UGX5.1 trillion in what is deemed to be “wasteful” expenditure. In the dossier titled the Report on Re- Focusing the GOU budget for the FY 2020/2021 To Mitigate The effects of The COVID-19 Pandemic and Support Food Security As Well as Job and Wealth Creation it is argued that the fact that the country is faced with the grim reality of the negative impacts of COVID19 on the economy, government should adopt austerity measures to eliminate any unnecessary spending and save money to boost the critical sectors of production, such as agriculture with emphasis on ensuring food security, import substitution to reduce on the import bill ; strengthen security and health systems to guarantee health and safety of Ugandans.
OWC proposes that government should deploy the saved resources (UGX5.I Trillion) to support agriculture financing and fund the job/ wealth creation sectors. The job and wealth creation sectors were spelt out in the presidential address to cabinet on 15th April 2020 and include those sectors that focus on food, shelter, clothing, medicines, defense, physical infrastructure, health, education and spiritual needs of Ugandans.
Also ,OWC further proposes that the budgetary savings be employed to support the agro-industrialization which is being implemented under the NDPIII while using the 14 production lines that have been identified by government namely , maize, cassava, banana, beans, Irish potato, sweet potato, millet, sugar cane, cattle (beef), dairy, coffee, tea, cocoa and fish.
What the austerity measures should achieve
According to OWC the proposed interventions should ideally provide a stimulus to establish conditions for existing agribusiness and food industry investors and agroforestry value chain actors not only to improve their options for survival but also to thrive. Emphasis should be placed at value addition for local enterprises expand ,Improve the capacity of Ugandans to support social-economic development, implement vigorously the government’s Import substitution and BuBu policies, and support the country’s export drive.
Ministries and projects that will be most affecetd
Among the Ministries that will be hard hit by the proposals include lands, housing and urban development whose budget it is proposed be cut by 94% followed by water and Environment 74.6%, ICT and National Guidance74.1%, Agriculture 47%, energy and Mineral development 37.6%, KCCA 21.9%, public administration 26.5% and trade and industry 25.1%,Science, technology and Innovation ,21% among others.
Among the proposed government projects that should be suspended include ADB support to UCI, Albertine Region sustainable Development Project, USMID, Competitiveness ad enterprise development, Cotton Production Improvement, Development of Industrial Parks, Government Network project, Development of Museums and Heritage Sites for cultural Promotion, Hoima Oil Refinery Proximity Development Master Plan, Markets and Agricultural Trade Improvements Programme (MATIP 2), National Petroleum Data Repository Infrastructure, Regional Communication Infrastructure and Retooling.
