CSBAG calls for fiscal discipline to ensure judicious use of public resources

Kampala, (UG): The Civil Society Budget Advocacy Group (CSBAG) has called for the enforcement of stringent mechanisms by stakeholders in the public sector if the country is to curb instances of fiscal indiscipline and ensure the judicious use of public resources.

This was revealed at the End of Year comprehensive press statement held on Friday, December 22, at CSBAG offices in Ntinda, Kampala to deliver key insights into Uganda’s economic and public finance management in 2023 Uganda’s economic and public finance management in 2023.

Speaking to journalists at the event, the executive director of CSBAG, Mr Julius Mukunda, highlighted key points on Uganda’s economic recovery and emphasized the substantial reduction in inflation from 14% to 2.4% is greatly attributed to various government strategies implemented throughout the year.

According to Mr Mukunda, the trade dynamics in Uganda witnessed a notable transformation, with a 37.5% reduction in the trade deficit. This positive shift was accompanied by increased export earnings from key commodities such as gold, maize, tobacco, and coffee, reflecting a robust performance in global markets.

Amid the positive economic indicators, Mukunda noted that the Uganda Shilling faced challenges as it weakened against major currencies, and such currency depreciation underscored the impact of heightened demand for the dollar in the international market.

“A positive development unfolded in the realm of credit extensions, particularly within the manufacturing sector. The increase in approved credit signalled promising signs for economic recovery, job creation, and an enhanced capacity for domestic trade,” he noted.

Mr Mukunda also acknowledged the government’s efforts in fiscal consolidation through the ongoing payroll special audit, an initiative which has helped to eliminate irregularities and potential ghost workers, contributing to a more transparent and accountable public finance management system.

He further noted that strides in anti-corruption measures were recognized, including the suspension of providers in public procurement by international financial institutions and actions against 32 companies by the Public Procurement and Disposal of Public Assets Authority (PPDA). These actions demonstrated progress in promoting transparency and accountability in public financial transactions.

“The operationalization of the Citizen Feedback Platform by the Office of the Auditor General garnered commendation from CSBAG. This platform enhances transparency and citizen participation in the audit process, fostering a more inclusive approach to governance,” Mr Mukunda explained.

IFMS Roll out a success

The successful rollout of the Integrated Financial Management System (IFMS) across all 300 Operating Units showcased the government’s commitment to operational efficiency. This technological advancement contributes to streamlined financial processes and improved accountability in public financial management.

A positive step was noted in the government’s allocation increase for gender and equity interventions in the FY 2023/24 budget. This allocation reflected a responsive approach to addressing citizens’ concerns and promoting inclusivity in resource distribution.

Red flag over Shs3.5t budget

CSBAG raised concerns over a UGX 3.5 trillion supplementary budget, citing violations of the Public Finance Management Act. The organization recommended decisive action from Parliament to address these concerns and ensure adherence to financial regulations.

The growing public debt, especially non-concessional debt, emerged as a significant challenge to economic stability and development. Urgent attention was urged to strike a balance between debt servicing and sustainable development, emphasizing the need for prudent financial management.

As Uganda faced a growing fiscal deficit, concerns were raised about the necessity for increased borrowing, potentially exacerbating existing debt challenges. Prudent financial management was underscored as crucial for long-term fiscal sustainability in the country.

CSBAG expressed dismay at fiscal indiscipline and corruption, emphasizing Parliament’s role in curbing such practices to ensure financial integrity and citizens’ well-being. Despite efforts to eliminate domestic arrears, enforcement gaps were identified, hindering economic growth and affecting the private sector.

The CSO therefore called for a reassessment of resource allocations, highlighting examples of wasteful expenditures that, if addressed, could free up resources for critical areas. The government’s rationalization efforts faced obstacles, including political interference, inadequate preparedness, and a lack of political will.

In conclusion, Mr Mukunda emphasized the need for a unified effort, political will, and adherence to prudent public finance management practices to address economic challenges and restore public confidence for a prosperous future.