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TOUGH TIMES: Domestic Arrears Projected To Increase To Shs4.4 Trillion In 2021/22 FY

Uganda’s domestic Arrears in 2021/22 Financial Year is projected to increase to Shs4.4trillion, a development that is likely to hit hard the private sector and affect economic growth.

The revelation was made by Nathan Nandala Mafabi, the Chairperson Parliamentary Public Accounts Committee (PAC)  while presenting the committee report of four consecutive years from 2017 to 2020 financial years to parliament.

According to the report, it was noted that there has been accumulative domestic arrears since 2017-2018 F/Y at 2.6 trillion, 2018/19 at 3.3trillion and  2019/20 at 3.8 trillion.

The increase in domestic arrears was attributed to the delay in releases of funds by Finance Ministry to Ministries, Departments and Agencies (MDAs).

It’s from this that the committee recommended to parliament to hold Finance Ministry and the minister liable of all the under-performance of MDAs causing losses to the government under the disguise of late releases of funds.

PAC also recommended to parliament to bar Finance Ministry from rolling out unspent funds from ministries votes at the end of the year to be part of the next financial year budget.

According to Mafabi, Finance Ministry  has made it a routine to release lump sums of funds towards the end of the financial year making it difficult for Accounting officers to spend the money in a shortest period of time. It is later transferred to the consolidated fund which is later used for the next financial year.

He added that this has also led to delayed procurement, increase in arrears and utility bills , thus affecting service delivery in the country.

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