Government has been urged to honour its financial obligations to the Bank of Uganda (BoU) in time to avoid penalties.
This is after the Auditor General’s report noted that BoU penalized Government to a tune of Shs4O5.O49Bn for failing to meet its contractual obligations for domestic debt that had matured in the year ended 30th June 2023.
This is contained in the report of the Public Accounts Committee – Central Government on the Auditor General’s Report on Treasury Operations and Consolidated Financial Statement of Government of Uganda for the Year Ended 30th June 2023.
The report was presented to Parliament by Muwanga Kivumbi, the Chairperson PAC, but it’s yet to be debated and adopted.
According to the report, the Auditor General noted that BoU also charged a total of Shs16.657Bn as bank charges in the financial year under review.
“The Accounting Officer explained that the Government had initiated discussions with Bank of Uganda with a view of revising these charges downwards or to institute a cap to reduce their strain on the budget,” the report says, adding that the Committee observed that the root cause of the High Penalty fees charged by BoU is the failure by government to honour its obligations.
“The Committee recommends that Government should honor its obligation with BoU to avoid unnecessary penalties to enable BoU achieve its core mandate of monetary policy and further provide banking services to Government without necessarily pushing the country into unsustainable debt,” the report says.
