CSBAG Executive Director, Julius Mukunda making his remarks
MPs has been warned against passing into law the current oil Bills because it will make Parliament powerless with no say on oil resources.
The warning was made by Civil Society Budget Advocacy Group (CSBAG) Executive Director, Julius Mukunda while presenting their views on the Public Finance Management Amendment Bill 2021 before Parliament’s Finance Committee at Sheraton Hotel.
Government is seeking to amend section 57 by inserting a new clause (5) (a) and (b) of the Public Finance Management Act 2015 to allow the Uganda National Oil Company (UNOC) to retain the proceeds from the sale of petroleum applicable petroleum agreements for the purposes of meeting its financial Obligations arising from applicable petroleum agreements in each financial year based on the approved work programs and budgets for the financial year.
However, Mukunda warned that the proposal will weaken the accountability mechanism and state institutions already in place, yet oil is an important resource which should be jealously guarded to ensure that the implementation programs in that regard is in line with the national audited processes.
“This move further seeks to undermine the oversight role and power of the parliament as an independent army of Government charged with the duty of supervising Government parastatals and state enterprises such as Uganda National Oil Company in their planning and expenditure programs,” he explained.
“The purpose for the move highlighted in the proposed section 57(5)(a) is unreasonable as our annual budget process is sufficient to accommodate any emerging financial needs of all Government parastatals, state enterprises and companies like the Uganda National Oil Company,” he added.
He said there are already existing agencies like the Uganda Revenue Authority with clear guidelines on how they can spend money at source to enable them meet their urgent expenditure obligations.
Section 14 of the URA Act allows the Authority to spend money at source with the authorization of the Minister of Finance to enable the Authority meet its obligations without interruptions but the sum spent shouldn’t exceed the amount appropriated by parliament.
Activists want this provision replicated with UNOC instead of having the leeway to spend money without oversight cautioning Parliament and the current provision rejected by the parliament for being unnecessary and attempting to erase benefits of having all bodies in contact with public funds remit the same to the fund.
The activists also asked Parliament to reject the provision that would give both Cabinet and Board of UNOC powers to oversee investment of UNOC without Parliament oversight.
James Kaberuka (Kinkizi West) although acknowledged that UNOC must have flexibility to operate and compete with other business companies, by solving the bureaucracy, to enable the company not lose in the business fraternity, but this isn’t UNOC’s proposal, but is being fronted by someone hiding behind UNOC because it is a business arm of government.
“To say that UNOC which is the business arm of government and you are only to be answerable to cabinet and to the board and not parliament, then the people of Uganda are relegated from the oil operations and that is very bad. It is possible that even the people who believe that this is bad law, can be convinced to be a good law,” he said.
Dickson Kateshumba (Sheema Municipality) said there is need to create a balance to enable UNOC meet its operations but the legislation shouldn’t cater for all operations of UNOC as well as draw a red line when it comes to parliament retaining its oversight.
“There is no doubt that as parliamentarians, we need to set a red line on appropriation because that is our primary role and anything that threatens that role basically touches on the independence of the legislature. We need to look at these laws closely to make sure the appropriation role isn’t watered down,” remarked Kateshumba.
Paul Omara (Otuke County) said there is need to safeguard the important role of parliament which is appropriation.
“UNOC can’t be bigger than Government, if there is anything we can give to UNOC to meet its obligations, it can come under a supplementary. But the idea of removing the mandate of appropriation from Parliament and you give a cash clank to UNOC to receive money is completely unacceptable,” said Omara.
