EU Welcomes Reduction In External Budget Support

Donor communities have welcomed news that Uganda will fund 80 percent of its 2013/2014 budget. Finance Minister Maria Kiwanuka on Thursday announced that the budget is historical this time, as over 80 percent of the resources are internally generated.
EU Head of Delegation Ambassador Roberto Rudolfi
EU Head of Delegation Ambassador Roberto Rudolfi

Donor communities have welcomed news that Uganda will fund 80 percent of its 2013/2014 budget.

Finance Minister Maria Kiwanuka on Thursday announced that the budget is historical this time, as over 80 percent of the resources are internally generated.

Donor funds accounted for about 25 percent of the 2012/2013 financial year budget with the European Union giving Uganda about 300 million US Dollars.

But this time, Kiwanuka said that out of the total resource inflows of 13.16 trillion shillings, at least 10.5 trillion or 81.1% of the budget will be internally financed.  The Uganda Revenue Authority (URA) will collect taxes amounting to 8.48 trillion, while 275 billion shillings will come from Non-Tax Revenues. The other local sources include issuing of Government securities worth 1.04 trillion shillings among others.

Some of the sources for URA include new taxes on gambling, international calls, mobile money, domestic water, wheat flour and hotel accommodation among others.

The total external financing of the Budget, according to Minister Kiwanuka, will amount to 2.6 trillion shillings or 20 percent of the total projections. Budget support comprises of 213 billion while Project aid amounts to 2.44 trillion.

The Head of the European Union Delegation  Roberto Rudolfi said as development partners, they rejoice since they will now be offering only 18 percent of budget support. He hopes that each financial year the donor support could decrease.

The EU was among other development partners that cut aid to Uganda last year after 50 billion shillings was misappropriated by staff at the office of the Prime Minister.

Ambassador Rudolfi notes that even though this led to investigations and disciplinary action taken against the culprits, it was incomplete and not perfect. He insists that progress in fighting corruption must continue to ensure that government is out of debt by the event of stealing money.

Alphons Hennekens, the Netherlands Ambassador, says this is a good sign for Uganda to be able to provide finances that are needed for the development of the country. These include infrastructure such as roads and railway.

Minister Kiwanuka stated in the budget speech that her ministry has fully supported a Private Members’ Bill to seek further advancement to fight against Corruption. This will include other pieces of legislations such as Anti-Money Laundering Bill which is aimed at tracking funds gained from illicit activities and for enhancing global security.

Kiwanuka also called for the expediting of the Public Finance Bill which is still before Parliament to be passed. The Bill explicitly seeks to ensure timely and accurate reporting of Government funds spent and to place individual responsibility on accounting officers for proper management of funds under their control.

In a move to strengthen the fight against corruption, Kiwanuka announced that she has allocated additional funds to the various anti-corruption institutions such as Office of the Auditor General, Criminal Investigation and Intelligence Directorate (CIID) and the Inspectorate of Government.

Others are Directorate of Public Prosecution and Ethics and Integrity to enforce accountability and Accountant General’s Office to facilitate the rollout of the Integrated Financial Management System.

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