Parliament to budget for contingency fund to curb supplementaries

Legislators have committed to budget for a contingency fund in the next budget cycle after it was left out in the Financial Year 2022/2023 budget.

The commitment came on Wednesday, September 21, 2022, during plenary when the Vice-Chairperson of the Budget Committee, Hon. Ignatius Wamakuyu, reported that although the proposed budget of Shs48.1 trillion had included the funds, it was removed at the last moment during the processing of the budget.

Wamakuyu was responding to a question raised in an earlier sitting by the Manjiya County MP and also Chief Opposition Whip, Hon. John Baptist Nambeshe, on contingency funds.

He said the minister proposed to reduce it from Shs223.9 billion to only Shs62.068 billion for debt servicing shortfall but it was later totally removed.

“Given the constrained resource envelope and the statutory obligations to prioritise servicing of public debt, the committee established that it was prudent to provide that debt service shortfall,” he said.

Wamakuyu advised that in the future, the finance ministry should comply with the statutory obligation as per section 26 of the Public Finance Management Act 2015 as amended and allocate money for the contingency fund.

The Butambala County MP, Muhammad Muwanga Kivumbi, who represented the Chief Opposition Whip, said that the contingency fund is a statutory requirement and all budgets need to have a contingency fund.

“During floods we need a contingency fund, and the best way for us to avoid supplementary budgets, we need to consistently provide for a contingency fund,” he said.

He says both the ministry and the budget committee should take responsibility as the ministry did not allocate and the budget committee did not follow.

However, the Deputy Speaker guided that the Budget Committee cannot be faulted, as the whole House approved the budget. He, however, said that the experience should be a learning lesson for the next budget.

“It is an eye-opener, and what I loved about this is that we can police ourselves to ensure that we address such constitutional requirements. So, in the next budget, please let us ensure that we comply with the law,” he said.