LUCAS MUSISI
KAMPALA –During a briefing held on Tuesday, Ramathan Ggoobi, the Permanent Secretary/Secretary to the Treasury of the Ministry of Finance, Planning & Economic Development, delivered a comprehensive overview of the economy, expenditure releases in the first quarter of the Financial Year, and provided guidance to Accounting Officers on executing the Budget for FY 2023/24.
Ggoobi emphasized the importance of implementing fiscal consolidation measures to preserve debt sustainability and support the ongoing post-Covid recovery. The government’s strategy involves optimizing spending in areas that have the greatest impact on the economy. To avoid excessive borrowing, the government is committed to reducing expenditures for activities that do not contribute to the economy’s value or the well-being of Ugandans. Ggoobi highlighted the government’s efforts in exploring innovative financing initiatives, which resulted in substantial savings of over Shs 1.977 trillion in interest costs last year.
To maintain financial prudence, the government will refrain from borrowing at high-interest costs, particularly in the domestic market. Ggoobi urged domestic financing partners to adjust their expectations, emphasizing that the government will only contract domestic debt if it aligns with the financial interests of the taxpayers.
Turning to the approved budget for FY 2023/24, the total budget stands at Shs 52.736 trillion, with allocations distributed across various categories, including wages, non-wage expenditures, government development, external financing for development, debt and treasury operations, arrears, and local revenue.
Ggoobi then provided highlights of the first quarter releases for FY 2023/24. In adherence to the Ministry’s commitment to releasing funds before the 10th day of the first month of the quarter, Ggoobi issued the Quarter One Expenditure limits on July 6th, 2023, ensuring the timely execution of government programs.
For the first quarter (July-September), Shs 4.833 trillion has been released, accounting for 16% of the discretionary budget. The releases encompass various categories, including wages, non-wage expenditures, government development, and arrears.
Ggoobi provided a detailed breakdown of the releases, highlighting key allocations. Notable allocations include wages projected at Shs 1.824 trillion (25% of the wage budget) with a 50% release for Missions Abroad to mitigate currency fluctuations. Additionally, funds have been allocated for pension and gratuity payments, capitation grants for schools, essential medicines and drugs, ongoing projects, universities, road maintenance, and arrears.
In conclusion, Ggoobi emphasized the need to ensure fiscal discipline, controlled borrowing, and macroeconomic stability in executing the Quarter One release. He directed Accounting Officers to prioritize the timely payment of wages, salaries, pensions, and gratuities, and to display payrolls on notice boards. It was also stressed that payment of service providers and clearance of domestic arrears should be prioritized to avoid penalties and further accumulation of arrears. Ggoobi highlighted the importance of obtaining clearance from the Ministry of Public Service before conducting recruitment and ensuring adequate wage provision for promotions and re-deployments. He reiterated the government’s commitment to fiscal discipline, budget credibility, service delivery, and timely project execution, with a stern warning that supplementary expenditures not serving security or industrial policy purposes will not be entertained.
In closing, Ggoobi assured the audience of the Ministry’s commitment to the timely release of funds and encouraged all stakeholders to stay informed through media channels and the Budget.