Civil Society Organizations under their umbrella, the Civil Society Budget Advocacy Group gathered to share perspectives on the National Budget Framework Paper FY 2023/24, which was tabled by the Minister of Finance Planning and Economic Development to Parliament in December 2022.
The presser was held at CSBAG Offices in Ntinda with different stakeholders as they commended and gave recommendations to the National Budget Framework Paper FY 2023/24.
Despite the challenges faced by the country including inflation, CSOs commend Government on the measures taken to revamp the economy that have resulted in growth of private sector credit by 0.4% between November and December 2022, trade balance improvements and retaining the stability of the Uganda Shilling relatively against the dollar during the three months to November 2022 which appreciated by 1.6.
The total FY 2023/24 resource envelope is projected to increase from UGX 48,130.7 billion in FY2022/23 to UGX. 49,988.7 billion in FY2023/24. To note is that the discretionary resource envelope is projected to decrease by UGX 2,533 billion due to an increase in the interest payments to UGX 6,135.5 billion from a UGX 4,691.9 billion, of which UGX 5,227.6 is for domestic interest payments and 907.9 billion is for foreign interest payments and commitment fees.
As of June 2021, the share of public debt stock to the Gross Domestic Product had increased from 46.90 percent (US$ 19.54 billion) to 48.4 percent (US$ 20.99 billion) in June 2022. The is partly driven by Uganda’s focus to borrow on non-concessional terms which ultimately increases the cost of borrowing and high cost of debt servicing and reduces discretionary spending.
“We call upon the Government to cap on borrowing non concessional loans and ensure prudent debt utilization. For example, only financial and economically viable public investments projects should be approved for financing.” The statement read.
The CSO’s also noted that the Community Mobilization and Mindset Change program budget is projected to reduce by 70.6%. This is likely to affect implementation of critical interventions for vulnerable groups. Subvention grants under the Ministry of Gender Labor and Social Development will experience a budget cut of 80%.
In some of their recommendations they called upon the National Trade Sector Advisory Council to be adequately funded to ensure adequate consultations on the ongoing negotiations. Furthermore, Parliament needs to task the Ministry of Trade and Industry to provide timely briefs on the status of trade negotiations to enable effective oversight.
The country has and still grappling with issues like the high inflation of 10.2% above the target of 5% as of December 2022 and increasing public debt projected to reach 53% of the Gross Domestic Product by June 2023.
