Will Uganda’s 2019/2020 FY Budget achieve Industrialization and shared Prosperity or its just Sloganeering as usual?

Lydiah Namayengo writes;-

At the end of every financial year that starts in July and ends in June of the following fiscal year, the President of Uganda under Chapter 7 of the 1995 Constitution of Uganda (President), Art. 101 says that “President shall at the beginning of each session of Parliament appear to deliver to Parliament an “Address on the State of the Nation” which was done on 6th June 2019 at Serena hotel.

Lydiah Namayengo writes;-

A week following the State of the Nation Address should be the National budget reading where Hon. Matia Kasaijja the Minister of Finance, Planning, and Economic Development was on 13/06/2019 able to do National Budget Speech Reading on behalf of the President under the campaign #KnowYourBudget19 at Serena hotel.

Uganda’s budget theme of FY 2019/2020 is ;- “Industrialization for Job creation and Shared Prosperity”.  This comes at a time when the need to boost industrialization is a t the core of Uganda’s development agenda as derived from the African Union’s Accelerated Industrial Development for Africa (AIDA) Initiative. This being the same theme of the 2018/2019 FY budget, Uganda has established policies like the National Industrial Development Plan 2017, National Export Development Strategy (NEDS), Micro Small and Medium Enterprises Policy 2015 &Buy Uganda Build Uganda to build a modern, competitive and dynamic industrial sector that is fully integrated into the domestic, regional & global  economies to create jobs, increase exports, and address trade deficits that stood at USD  2,434 million in FY 2017/2018.

However, have these policies been implemented to boost an allk inclusive people centred industrial economy? Or it is just sloganeering??!

Uganda’s national budget has been claimed to be a progressive one in resource allocation over the last four years since 2016 elections in this term in power where by we had 20 Trillion in financial year 2016/2017 budget, 2017/2018 budget scooped 22 Trillion, 2018/2019 had 32 trillion and 40.48 Trillion in 2019/2020 financial year’s budget.

But the question is, when we had 20 Trillion budget in 2016 and later rose to a 22 Trillion budget in 2017/2018, how many more industries did we create?  How many people were taken out of poverty? How many more jobs did we create as a country to reduce on unemployment?

It should be noted that although Uganda claims to have made progress towards poverty elimination, with a national target of reducing poverty to 10%by 2017; 21%of Ugandans still live in extreme poverty today even with a budget under the theme Industrialization for job creation and shared prosperity!!

When we had a 22 Trillion budget in 2017/2018, Uganda had 465,000 public service jobs, and after the 2018/2019 budget, Uganda had 470,000 public service jobs only at the end of the financial year?

So is 500 jobs worth the 10 Trillion budget increase from 22 to 32 trillion budget or was it just a mere matter of sloganeering? Was unemployment as one of the major problems facing Ugandans especially young people not considered to be very urgent by government to be quickly prioritised?

A budget is a statement or government’s financial plan that shows the estimated income and expenditure of the given financial year as well as its performance in the previous year.  A budget may be a deficit budget, surplus budget, a balanced budget or a supplementary budget.

A deficit budget is where the estimated expenditure is more than estimated income, while a surplus budget is where u have more estimated income than expenditure while a balanced budget is one where estimated income in a given financial year is equal to estimated expenditure. 

A surplus budget where estimated income is higher than the expenditure is the best budget any country should have every financial year, but unfortunately Uganda’s 2019/2020 FY budget is a balanced budget that expects to spend 40.48 Trillion and also plans to get the same as income though with a projection of 74.5% coming from domestic financing and 25.5% from external financing.

So how will a budget with same income and expenditure lead to industrialization? What if the prices of inputs and products increase, what happens? What if more Ebola, cholera cases and other disasters emerge that were not foreseen, what will happen since the balanced budget does not take care of risks &  eventualities but just works on actuals or as planned since u do not have extra money??!!

How can u run the country on a balanced budget? This is totally a sign of weakness of the economy and a failed state. Developing countries and economies make surplus budgets and can finance those budgets to over 80% but not making a balanced budget whose source of revenue u are not even sure of as a country that u will manage to raise the resources required!!!! Therefore, isn’t the issue of industrialization not just mere sloganeering??!!!

Industrialization is the degree to which a country’s economy is characterized by mechanized manufacturing processes through increased GNP,consumption per capita & percentage of labor force in industry.

This should therefore be depicted in the resources allocation in the national budget where the industrial and manufacturing sector should be prioritized. 

Unfortunately, the 2019/2020 financial year budget has prioritized the services sector making them drive the economy which later leads to a weak manufacturing sector that makes the economy more vulnerable and resilient. 

For example, the 2019/2020 FY budget allocated 6.4 trillion to works&transport 3.6 Trillion to defense&security, 3.2 Trillion to education, 2.9 Trillion to energy, 2.8 Trillion to Local Government, 2.5 Trillion to health, etc but however allocated 1 Trillion to agriculture, 171 billion to trade& industry, 159 billion to Science &technology &only 123 to ICT!!!

So how can a country that has a budget under the theme: “Industrialization for Job creation &shared Prosperity” make Trade and industry sector one of the least and worst funded in the national Budget?!! So how can u promote industrialization without funding industries & trade, ICT &science and technology yet industries require technology to perform well?!

Over 70% of Uganda’s population depend on agriculture but agriculture in this budget is one of the worst funded sectors?! 

The President during the State of the Nation Address talked about investing more in Operation Wealth Creation products like seedlings for citrus, orange seedlings, cocoa seedlings&  cassava stems.

But u have not outrightly come out to invest in agro processing industries to improve agricultural produce in terms of quality and quantities!! The question is, does Uganda still need agricultural funds to be invested in OWC to buy cassava stems or it needs to invest in establishment of factories and industries to process the products from the farmers and more on mechanization of farming to achieve industrialization!!!

How will Uganda achieve industrialization when we still have 80% of farmers practicing subsistence farming that have never transformed to commercialized farming!??

How can agricultural sector that contributes about 70% of the total share of employment contribute only 27% to GDP (2017/2018) and yet we are talking about industrialization and job creation!??

This poor performance of the agricultural sector which employs majority population explains the low tax revenue performance in n Uganda causing the tax-GDP ratio to hover at about 12 – 14% thus reducing Uganda’s financial capacity to support her development initiatives using her own resources. So how can a country that has a poor tax – GDP ration talk about industrialization without actually investing in job creation ventures?!! Isn’t this sloganeering??

Industrialization for job creation and shared prosperity was still the same theme of the 2018/2019 FY budget but Ugandans did not notice any increased industrialization levels in 2018 since government claims to have 4900 factories compared to the 80 they had in 1986. If we have the factories in place,why are Ugandans becoming more poorer everyday yet the poverty levels were low in 1986?!

So aren’t we still just sloganeering while repeating the same rhetoric and wasting the time for Ugandans?!

This has not only been seen in 2019/2020 budget, but however has been the case for the last 30 years where Uganda’s economic growth looks impressive in figures where Uganda’s GDP recovered from 2.5% in 2016, to 6.4% in 2017, &there after 6.8% in 2018/2019 thereby making an economy equivalent to USD 27.9 billion.

But however, this has been the opposite in reality with a non inclusive paradigm. 

So how can u promise Ugandans industrialization and shared prosperity, yet in real actual sense for the last 30 years and today, the per capita figures, GDP &GNP are not depicted in people’s lives as they are still rotting in unemployment, poverty levels, discrimination, dependency syndrome, high income inequality, and absence of a creative environment for job creation!!!

The President and Minister of Finance talked about Shared Prosperity in the 2019/2020 FY budget, but Uganda currently has 65% of the public service jobs, Ministries, Departments, Agencies, Police, Military etc owned by one tribe from the Western part of Uganda. Don’t Ugandans from the East, Northern Uganda and Central region qualify to have these jobs?!!

U talk about shared prosperity in this budget, but how much money has been allocated for establishment of industries in the Northern region, Eastern region and central region!!? Why should the budget talk about industrialization yet can’t allocate funds for the same!?? Isn’t this just sloganeering??! 

Northern region in Moroto has gold, and Hoima/Kikuube district has oil but how many industries have been established and how many citizens are employed to work in the oil or  gold mines apart from having the sons of the first family and the first tribe travel abroad to study oil, gas &gold courses!? Or even supporting foreign investors take over all opportunities and jobs in those sectors without taxes as agents of the first family and the political party in power?!! 

Uganda’s Oil and Gas sector has the potential in the next 25 years to become a significant oil producer with 200,000 barrels per day there by generating about USD 3 – 3.5 billion annually at peak production (2029-2045). So with the right macro economic management policies and strategies, that high level of production would lead to substantial public revenue that could increase economic growth through public investment in infrastructure, education and other social services. 

But the question is , what policies has government put in place to allow the citizens in the recipient districts to accrue royalties, profits, do business and actively participate in the sector?!! If these policies are not set, then why should we talk about industrialization through job creation and shared prosperity, isn’t it sloganeering??!

During the 2017 Age Limit Amendment to endorse Life Presidency, the President came out very clearly and pronounced gold and oil as his personal items when he said;-

  “You want me to go, I go where? Do u think I can leave my oil &gold that I have just discovered? U are dreaming!!! 

This was a clear indicator that Prosperity is for the few! So, isn’t the theme of industrialization for shared prosperity not just sloganeering??!!

During the 2016 State of the Nation Address after President winning the 2016 general election, he promised that Uganda will be a Middle income country by 2020, so it’s six months to 2020 and the President did not mention about this! Did he just forget this or it was intentional!!

The 2019/2020 budget like the  last three financial year budgets have not prioritized issues that take Ugandans to a middle income country apart from just mentioning about industrialization, so will the middle income status just be a miracle for Ugandans next year?!! Or its the same rhetoric & sloganeering as usual!??

In cases where a country means what it says, the government would have requested for a supplementary budget to boost industrialization for job creation and shared prosperity!

A supplementary budget is the extra additional amount of money that a government department or Ministry may request after approval of the National budget.

But unfortunately, over the last 30 years, supplementary budgets have been requested for either police and military to purchase tear gas, bullets,mambas to fight opposition and keep themselves in power, or for State house to get extra money to bribe youth that support opposition and destroy and threaten every outrightly thinking Ugandan 

as well as supplementary budget to fund the 2021 Presidential national campaigns pretending to be OWC trips in the name of poverty reduction but not for industrialization or manufacturing sectors that benefit the people. So isn’t this sloganeering?

So why can’t we get a supplementary budget for education, health, job creation, skilling and Industrialization, is it a crime to request one for the good of the people??!

The 2019/2020 FY budget talks about key thematic areas including harnessing key growth sectors like agriculture& agro industry, tourism, oil, gas, &minerals but however makes them to be part of the least funded sectors. Isn’t this sloganeering to just talk about industrialization?!

Enhancing private sector growth &development is another key 2019/2020 FY budget thematic area but the budget however has not provided support like the subsidies and tax holidays to the small scale and medium industries & entrepreneurs that have created jobs that government has failed to create!

 Even when it keeps talking about them but instead gives all the subsidies, free land, loans & long term tax holiday to foreign investors like that of construction of Lubowa hospital that was a “cracked government Mafias deal” thereby leaving industrialization for job creation & shared prosperity a dream! So isn’t this just sloganeering??!

Promoting human capital is another key thematic area that u claim the 2019/2020 budget will handle but the reality does not support this. For example 75% of the human capital &Uganda’s population are young people below 35 years that fall under the Ministry of Gender, Labor &Social development that houses them and has been running the Youth Livelihood Program and Youth Capital Venture Fund. 

However, the 2019/2020 budget showed a drastic cut of the Youth Livelihood Program under the Social Development sector to leave just a Revolving & Recovery fund in the Ministry as youth will no longer access YLP funds for job creation but instead created a Youth fund in State House!!

So how can a budget with a theme about job creation withdraw funds for job creation??!!

How accessible can the funds put in State house for local people be? How will my friends from Nakasongola, Bukomansimbi, Kaabong access state house as young people to get funds if its really for job creation??

Wasn’t this just a move to politicise all youth funding , sabotage young people and keep them more poor such that if u can’t support the NRM, then u can’t receive these funds?!

Wasn’t this not a strategy to fight against opposition and especially done to silence the young people who come up to raise their voices in demand for jobs, services, fairness & inclusiveness or even to bribe all those youth that come out to fight the NRM Regime?!!

How can a budget that thematises promotion of human capital fail to prioritize the civil servants that have always been demanding for a good working environment, fair pay, proper professional working facilities, increasing their salaries fail to prioritize these in a bid to promote so but has kept on making empty promises of salaries or even bribing the leaders of the worker’s councils and trade unions as well as threatening to fire all the health workers, teachers & civil servants that breed the human capital of Uganda?! 

No wonder, there children do not go to our schools and neither are they treated from our local ill equipped health centres, hospitals and schools! So isn’t having that theme sloganeering??

How many drugs manufacturing industries were included in the 2019/2020 FY Budget to promote industrialization? How many school furniture, chalk, books, pens, desks, uniforms manufacturing industries or factories were budgeted for in this budget?! Isn’t this sloganeering?!

A national budget should be a people centred budget and a pro poor budget that focuses on the needs of the poor people as well as having people at the centre. 

But the 2019/2020 budget has instead increased taxes levied on the people than increasing sources of income for the people to promote job creation.!

For example, government has increased Pay As you earn to collect 3.25 trillion, corporate tax – 1.28 Trillion, phone local talk time to 572.09 billion, OTT to 51.27 billion, cement 149.9 billion, mobile money to 246.1 billion & cooking oil to 33.26 billion as well as taxes on agricultural inputs like seeds, fertilisers, how’s, parrafin, soap and other basic things that poor people need and use everyday. This is a total sabotage to  the notion of shared prosperity because it in turn widens the difference between the haves and have nots instead of closing that gap in a bid to reduce income inequality.

Industrialization has claimingly been a key priority & takes an integral part of Uganda’s social &economic development plan the “Vision 2040” which the President declared in 2017 as the year of mass industrialization. 

But while government talks about & knows the importance of industrial policy, there is no out right practical industrial policy established and effective implementation if the industrial interventions & policy. So isn’t this sloganeering??!

I call upon the government of Uganda to relocate the Youth Livelihood Program to the Ministry of Gender, Labor &social development to avoid the biasness and bureaucracy associated with state house.

I cal upon the government of Uganda to establish a sector wide coordinated mechanism for youth programs housed in the other various ministries with a clear financing strategy that enables equity and accessibility by all young people irrespective of their political affiliation.

I call upon the young people to cone out outrightly and demand government of Uganda to prioritise their needs, create a separate vote or budget line in the National Budget to cater for their needs regarding employment, job creation and poverty reduction because the leaders they voted for do not care about them but care about how they continue staying in power.!

I call upon the Ministry of Education and Sports to re-awaken, upscale & track the Skilling Uganda program to empower young people and women with skills in a bid to promote job creation. 

How can a Ministry headed by the first lady with high level intelligence fail to realise that Skilling Uganda offices flopped and closed long time ago?!! Are u people still for us the people or for yourselves!?

Government should reduce the cost of electricity by more than 50% to allow the rural poor afford and use electric power for production to promote job creation.

The National Curriculum Development Centre together with the Ministry of Education and Sports must introduce compulsory teaching of technical training, vocational studies & skilling at all levels of education right from primary to University such that at whatever level a child drops out of school, they can still be job creators.

I call upon the Youth, women and people of Uganda to rise up and demand for accountability from government and Ministries as well as detest the continuous sloganeering from government bug give us real services, establish the industries as well as fulfill their promises as pledged or else #VoteThemOutOfPower!