UGIFT CASH SPLASH, SERVICE CRASH! Probe Reveals Delays, Weak Systems & Staffing GAPS as Billions Flow but Impact Lags
A fresh Auditor General’s report has torn into the performance of Uganda’s flagship decentralisation programme, exposing a troubling mix of strong spending on paper but glaring weaknesses in delivery, planning and execution under the Ministry of Finance Planning and Economic Development.
The audit of the Uganda Intergovernmental Fiscal Transfers Program for the year ending December 2025 reveals a programme that pumped billions into local governments but struggled to translate that cash into timely, effective services for ordinary Ugandans.
At the heart of the findings is a major technological setback that raises questions about planning and procurement oversight. The long-awaited Integrated Health Management Information System, contracted to M/S Netcon Technologies India Private Ltd in 2025, had still not been delivered by the close of the financial year.
Auditors did not mince words, noting that “the system had not been delivered by the close of the financial year,” despite the procurement process having been completed. Even more concerning, the scope of the system was scaled down to just 15 health facilities — a move that effectively sidelines the broader national health system it was meant to serve.
“This did not adequately represent the National Health Service delivery landscape,” the report states, pointing to a worrying disconnect between ambition and execution.
The audit further exposes a blind spot in safeguarding government innovations, revealing that systems acquired under the programme were not copyrighted or patented. This failure opens the door to potential loss of intellectual property and weakens the government’s long-term control over critical digital infrastructure.
Yet in a striking contrast, the programme demonstrated near-perfect spending efficiency. Out of UGX 81.58 billion released for the 2024/2025 financial year, UGX 80.22 billion had been utilised — an impressive absorption rate of 99.5 percent.
But analysts warn this paints only half the picture.
“High absorption does not necessarily mean high impact,” one insider observed, as the report repeatedly highlights gaps between money spent and results achieved.
Funding from the World Bank further underscores the scale and stakes involved. To date, the Bank has disbursed USD 397.897 million, equivalent to UGX 1.44 trillion, representing 80 percent of the programme’s funding. However, USD 102.103 million — about UGX 363.79 billion — remained undisbursed as the programme approached closure in December 2025.
This raises concerns about whether critical interventions were left incomplete as the clock ran out.
Performance tracking also reveals a mixed record. While 50 central government actions under the Service Delivery Improvement Action Matrix were successfully implemented, 13 remained unachieved — a gap that auditors say cannot be ignored.
More troubling is the overall performance in service delivery areas, which averaged just 60.15 percent across sectors including water, education, health, and infrastructure in all 176 local governments.
Within this, human resource management emerged as the weakest link. Recruitment and staffing levels stood at a shocking 20.9 percent, far below the targets of at least 80 percent for heads of departments and full staffing at lower levels.
This staffing crisis is now being blamed for choking service delivery at the grassroots.
“How do you deliver services without people?” a sector analyst questioned, pointing to empty offices and overstretched personnel in districts across the country.
Planning and budgeting for infrastructure projects also came under fire, with technical appraisals scoring just 35.2 percent — a sign that many projects may have been poorly designed from the start.
In education, the picture is equally complex. While school amenities and quality indicators showed strong performance, overall efficiency in education service delivery remained low, suggesting that improvements in infrastructure are not yet translating into better learning outcomes.
Auditors further warned that with the programme closing in December 2025, several outcomes risk being achieved too late to have meaningful impact.
“The current rate of progress indicates that some outcomes may be achieved late in the project cycle, limiting time for sustainability and impact assessment,” the report cautions.
The ongoing review of the program by the World Bank through its Implementation Completion and Results Report (ICR) mission has now placed the programme under even greater scrutiny.
Speaking during recently, World Bank representative Barbara Magezi emphasized the urgency of completing unfinished work.
“Government should reflect on the issues discussed around the closure action plan for UGIFT 1.0. All activities that were started must be completed,” she said.
Her remarks signal growing pressure on Ugandan authorities to not only account for the billions spent but also ensure that unfinished interventions are brought to completion.
The programme, which has been central to strengthening Uganda’s fiscal decentralisation by channeling funds directly to local governments, was designed to improve service delivery in critical sectors such as health, education, and water.
It also aimed to boost accountability by linking funding to performance indicators — a model that now appears to have delivered mixed results.
As Uganda transitions to the next phase, UGIFT 2.0, policymakers face a daunting task: fixing structural weaknesses while preserving the gains made so far.
With the country pushing forward its Public Finance Management Reform Strategy 2025–2030, the stakes could not be higher.
Because as the Auditor General’s findings make painfully clear, spending billions is one thing — but turning that money into real services for citizens is an entirely different battle.
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