Gulu district is facing financial challenges due to a significant drop in local revenue following a presidential directive against the sale of forest products, severely impacting its economy.
The District Speaker Phoebe Ayoo highlighted the directive’s adverse effects on the economy, coupled with the detachment of the City from the District, which relied heavily on outlawed forest products. The decline in revenue has notably impacted the council business as mandated by the Local Government Act due to resource constraints.
Gulu District Council approved a budget of Shillings 29 billion for the 2023/2024 financial year, with education receiving the largest allocation of Shillings 13.3 billion, health allocated Shillings 5.7 billion, and administration granted Shillings 3 billion.
However, the District has only managed to collect Shillings 50 million of its proposed local revenue budget, attributing the shortfall to the enforcement of the presidential directive against forest product sales. The District received a supplementary budget allocation of Shillings 2.94 billion, bringing the total budget for the financial year to Shillings 32 billion.
However, approvals for sectoral allocations are pending as the Council has not convened to approve expenditures. Efforts to establish a new revenue base focusing on the cattle economy, particularly milk production, have been outlined. Gulu District boasts 53,000 herds of cattle, with plans to tap into this resource for increased revenue generation.
The merger of District administrative units is under consideration by development partners and the central government to streamline services and enhance efficiency. This move aims to empower local governments for effective decentralization, relieving the burden on the national economy.
Dr. Herbert Mutumba of the Northern Uganda Dairy Development Authority emphasized the significance of milk production, which constitutes 50 percent of the livestock sector’s GDP. The government’s establishment of a milk collection center in Gulu is poised to boost production in the region.
The dairy industry has proven instrumental in the country’s economic growth, with exports rebounding to US$102.6 million in 2021/2022 from US$92.4 million in the previous year, driven by increased production and improved breed adoption.