Henry Musasizi, State Minister of Finance- General Duties
Government through the Ministry of Finance, Planning and Economic Development has revealed plans to borrow Shs2.049Trn from local commercial banks to to fund the latest supplementary budget.
The revelation was made by Henry Musasizi, State Minister of Finance- General Duties while appearing before Parliament’s Budget Committee to defend the latest Shs3.819Trn that before Parliament for scrutiny.
Musasizi informed Parliament that the supplementary expenditure schedule will be funded from a combination of suppression within the Government Budget, URA revenue performance, additional borrowing and external financing
“The proposed additional borrowing of Shs2.049Trn to facilitate supplementary expenditure will increase the public debt to GDP ratio as at June 2022 from an earlier projection of 52.7% to 54.0%. however, this projection of 54% could be lower given that some of the additional expenditure provides a stimulus to the economy and will lead to higher GDP growth,” Musasizi said.
The Minister further defended the pending borrowing saying that revenue collection between July to October 2021 amounted to Shs6.036Trn against the target of Shs6.662Trn, thus registering a shortfall of Shs629.09Bn.
Muwanga Kivumbi (Butambala County) lashed out at the poor financial discipline exposed in the supplementary budget citing three entities that are receiving more funding in the supplementary budget, than their initial 2021/2022 national budget.
He cited Ministry of Trade that received in the normal budget Shs100Bn, but the supplementary budget indicates the Ministry will receive Shs173Bn.
Muwanga also pointed out that was Uganda Cancer Institute that received Shs74Bn and in the supplementary, it has a budget of Shs106Bn. Office of Prime Minister got a budget of Shs190Bn and its supplementary is Shs243Bn
“That means this agency is receiving more money than it ever budgeted for. This can’t be conceivable anywhere in the world. Had you operated under the normal budget without pretending to suppress, what would be the impact?” said Muwanga.
However, the Minister defended all the supplementary Budget requests saying all the requests went through the criteria set out by Finance Ministry and all items met the criteria of urgency.
“Every item that is included in this schedule was subjected to this criteria and they all qualify and those that don’t qualify, I have withdrawn them. We receive numerous applications and requests for supplementary expenditure, others become successful others we advise them to budget for next budget,” he said.
However, Wilfred Niwagaba (Ndorwa East) questioned the Ministry of Finance to explain under what legal framework that Finance is implementing budget cuts, after Parliament has carried out its appropriation roles.
