In Summary

Who is responsible? Section 13(1) of the Public Finance Management Act states that “The President shall cause to be prepared and laid before Parliament the proposed annual budget of government for a financial year.” Section 13(2) state that “The proposed annual budget shall be prepared in consultation with the relevant stakeholders.” Therefore, the President has the responsibility of ensuring that budgeted expenditure are representative and reflect the national priorities so as to minimise wasteful expenditure.

On December 7, Daily Monitor reported about the report by the Internal Security Organisation (ISO) to the President on government’s wasteful expenditure. The report echoed recommendation of other bodies on the need to carry out reforms by abolishing and or merging agencies with duplicating functions so as to reduce wasteful expenditure. The money saved should be used to boost civil servants’ salaries.

On June 7, in the aftermath of 2017/2018 Budget reading, Daily Monitor published excerpts of an interview with David Walakira, a civil society budget advocacy group budget policy specialist on his view about the budget. Asked about what he did not like about the Budget, Walakira said: “There is a lot of wasteful expenditure on allowances, workshops and seminars, welfare and entertainment, special meals and drinks, travel abroad, donations and hire of venue (chairs, projectors, etc), which will take Shs1.4 trillion of the Budget.

He added that the total wasteful expenditure is higher than the planned expenditure of Shs1.2 trillion on the priority sectors of agriculture, tourism, trade and industry and social development. It is not the first time for Budget specialists to decry wasteful public spending. There are sufficient records of these analyses and comments highlighting the same for every Budget year. Therefore, the content of the ISO report is neither special nor new. The report tackles the problem at the wrong stage and thus cannot yield the required result.

The government has clear internal controls on Budget spending and any expenditure, which was not initially budgeted for, must be approved by Parliament through a supplementary budget or by the Minister of Finance. If the spending was not in accordance with the Act, it would be considered as fraudulent and the accounting officers would be culpable. The report seems to highlight a case of mismatched priorities rather than fraudulent expenditure, which is solvable only at budgeting stage.

One other challenge that the government needs to address in the budgeting process is the deliberate building of budgetary slacks at different levels. Budgetary slacks take the form of deliberate underestimation of the expected revenue and/or an overestimation the expenditure in order to make it easy to achieve the target. This practice is a cause of wasteful expenditure.

Who is responsible? Section 13(1) of the Public Finance Management Act states that “The President shall cause to be prepared and laid before Parliament the proposed annual budget of government for a financial year.” Section 13(2) state that “The proposed annual budget shall be prepared in consultation with the relevant stakeholders.” Therefore, the President has the responsibility of ensuring that budgeted expenditure are representative and reflect the national priorities so as to minimise wasteful expenditure.

Accordingly, it is at the level of budgeting that the President can seek the services of the relevant technical persons to review and report to him the presence of potential leads on wasteful expenditure.

Henry Rwabuhinga,
[email protected]