June 21, 2013

NGO’s Accuse Maria Kiwanuka of Promoting Inequality

Civil Society Organisations (CSOs) say the 2013/2014 budget if passed in its current form will lead to greater inequality.

Finance Minister Maria Kiwanuka
Finance Minister Maria Kiwanuka

This includes inequalities in gender, social and economic exclusion of majority Ugandans which will culminate to welfare losses, exacerbate food insecurity, environmental degradation and worsening of domestic and foreign debt portfolio.

Paul Onapa, the Deputy Executive Director Development Research and Training (DRT), acknowledges that although investment and infrastructure which government has prioritized is important, there is need to back it up with a similar proportional investment in other sectors.

Onapa expressed his views at the civil society budget dialogue under the theme “Assessing Uganda’s Economic journey towards Socio-economic Transformation.”

The CSOs cite winners in the budget to be the Works and Transport sector with 1769.7 billion and the security whose budget will be increased from 945.1 billion to 1045.9 billion shillings according to the estimates presented to parliament a week ago by Finance Minister Maria Kiwanuka.

Public administration had an increment to 1121.1 from 1044.5 billion shillings, while the Energy and Mineral development is to get 1762.2 billion up from 1481.8 billion shillings.

The losers on the other hand, even though some had minimal increments in their budgets, include Tourism, Trade and Industry with 72.5 billion up from 51.2 billion shillings. ICT and Social development got 15.5 from 15.3 billion shillings while Education was allocated 1,592.5 billion shillings.

Other losers are health which was allocated 930.5 billion shillings, an increment from 852.2 billion shillings it was allocated last year. Water and environment has 382.3 billion shillings up from 354.1 billion and Agriculture gets 403.1 billion shillings.

Minister Kiwanuka during the budget speech announced that Uganda will finance its budget by 81 percent with revenue to be generated from the local taxes.

The CSOs welcomed a few proposed taxes such as on cigarettes, spirits and motor vehicle registration.

However, they oppose the hike on motor cycle registration fees which they argue shall adversely affect the rural population. The 10 percent tax on mobile money, they note, will have a negative effect on the poor and take away their source of protection considering that the service has deepened and widened access to financial services across the country.

Onapa says the challenge they face as civil society is that government does not listen to their suggestions to tax mortgage transactions, churches, mosques and corporate profits.

Other avenues of taxation to be explored would be by expediting the public service pension contributory scheme, tax all legislators’ and executives’ incomes including their allowances and increase tax on rental and capital gains.

Julius Mukunda, the Programme Manager Forum for Women in Democracy criticizes government’s continuous indiscipline especially on the supplementary budget. These mainly focus on unproductive sectors and recurrent expenditure such as entertainment, special meals and photocopying.  Mukunda calls for a stop to retrospective approval of expenditure and ensure that anything that qualifies as supplementary must be unavoidable, unpredictable and absorbable.

The CSOs also call on government to introduce limited non-concessional and domestic borrowing because it constrains service delivery in the private sector. Uganda’s external debt stands at 5.85 billion dollars, while the domestic debt stands at seven trillion shillings with the debt repayment in the financial year 2013/2014 going to increase to over a trillion shillings.

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